Going Over Niagara In A Barrel! Common Sense vs Opprtunism!

Bret Stephens see obsolescence. (See 1 below.)

Taxes going up by way of a VAT on top of what we already have? "POGO was right: The enemy is us (read Congress.)!" Can't cut spending, that would be unpatriotic. (See 2 below.)

Did the Supreme Court put out any 'affirmative' fires with their latest decision? (See 3 and 3a below.)

Using the same logic of 'affirmative action' does the president of the United States have the right to tell Black Americans they cannot live where they want to or on land that once belonged to Native Americans before they were driven off? During the days of segregation it was highly unlikely a white couple would sell thir home to a black couple but this president takes Israelis back to that time and place on the misbegotten belief acheiving an immoral agreement with Palestinians will appease Muslims and get him re-elected.

By Obama's same twisted logic, Israel should now be driving Israeli Palestinians out of Israel. But, perhaps Netanyahu's obdurateness and events on the ground have forced a change in Obama's tactics and strategy?

Of late, Obama reminds me of someone going over Niagara Falls in a Barrel. Hope he figures out what being president is all about in the next several months. He might read some books about HST! But then, common sense is something you are born with and character and adherence to principles is something you should have learned at an early age. Opportunism is no substitute and playing house can be fun but not with a nation's fate.

As Obama's foreign policy initiatives sink our former adherence to human rights is sinking with them.(See 3b and 3c below.)

When you are a tiny nation political 'ganging up' is a fact of life. Even the French, the paragon of world virtue and leadership, get emboldened. Zarkozy becomes Obama's poodle? (See 4 below.)

Dick



Dick

1)Obama's Obsolete Iran Policy: The audacity of hope gives way to the timidity of realism.
By BRET STEPHENS

President Obama's Iran policy is incoherent and obsolete. Maybe David Axelrod should take note.

On Sunday, Mr. Obama's consigliere was asked about Iran by ABC's George Stephanopoulos and NBC's David Gregory. Mr. Gregory asked whether there "should be consequences" for the regime's violent suppression of peaceful demonstrations. "The consequences, I think, will unfold over time in Iran," answered Mr. Axelrod.

Mr. Stephanopoulos quoted Iranian President Mahmoud Ahmadinejad as saying that "this time, the Iranian nation's reply will be harsh and more decisive to make the West regret its meddlesome stance." Said Mr. Axelrod, "I'm not going to entertain his bloviations that are politically motivated." As for whether the administration wasn't selling short the demonstrators, Mr. Axelrod could only say that "the president's sense of solicitude with those young people has been very, very clear."

Associated Press Mahmoud Ahmadinejad
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Bottom line from Mr. Axelrod, and presumably Mr. Obama, too: "We are going to continue to work through . . . the multilateral group of nations that are engaging Iran, and they have to make a decision, George, whether they want to further isolate themselves in every way from the community of nations, or whether they are going to embrace that."

Translation: People of Iran -- best of luck!

For a president who came into office literally selling the Audacity of Hope -- not just for Americans but for all mankind -- his Iran policy can so far be summed up as the timidity of "realism." That's realism as a theory of international relations that prescribes a foreign policy based on ostensibly rational calculations of the national interest and assumes that other nations act in similarly rational fashion.

On this reasoning, it remains the American interest to reach a negotiated settlement with Tehran over its nuclear program, whether or not Ahmadinejad was fairly elected. Likewise, it is in Tehran's best interests to settle, assuming the benefits for doing so are sufficiently large.

If this view ever had its moment, it was in the months immediately after Mr. Obama's inauguration. The administration came to town thinking that America's problems with Iran were largely self-inflicted -- a combination of "Axis of Evil" and "regime change" rhetoric, an invasion that gave Iran a reasonable motive for wanting to arm itself with nuclear weapons, and an unwillingness to try to settle differences in face-to-face talks.

In other words, Mr. Obama seems to have thought that a considerable part of America's Iran problem was simply an America problem, to be addressed by various forms of conciliation: Mr. Obama's New Year's greetings to "the Islamic Republic of Iran"; the disavowal of regime change as a U.S. objective; the offer of direct talks without preconditions; withdrawal from Iraq; the insistence, following the election, that the U.S. would neither presume to judge the outcome nor otherwise "meddle" in an internal Iranian affair.

What did all this achieve? Iran's nuclear programs are accelerating. It is testing ballistic missiles of increasing range and sophistication. Its support for terrorist groups such as Hamas and Hezbollah is unabated. Ahmadinejad stole an election in broad daylight. Supreme Leader Ali Khamenei blessed the result. British Embassy staff are under siege. A campaign of mass arrests and intimidation is underway and a young woman named Neda Soltan was shot in the heart simply for choosing none of the above.

Oh, and Iran still accuses the U.S. of "meddling."

Now Mr. Obama is promising more of the same, plus the equivalent of a group hug for the demonstrators. Is this supposed to be "realism"?

A more common sense form of realism would reach different conclusions. One is that the "bloviations" of Ahmadinejad are not just politically motivated, but are also expressions of contempt for Mr. Obama. That contempt springs from a keen nose for weakness, honed by the habits of dictatorship and based on an estimate -- so far unrefuted -- of Mr. Obama's mettle.

Second, as long as Tehran can murder its own people, scoff at a U.S. president and flout U.N. resolutions without consequence, it will continue to do so.

Third is that the Achilles Heel of the Iranian regime isn't its "isolation." (What kind of isolation is it when Ahmadinejad's "election" was instantly ratified by Russian President Dimitry Medvedev?) Nor is it its vulnerability to a gasoline embargo, vulnerable though it is. Its real weakness is its own domestic unpopularity, which has at last found expression in a massive opposition movement.

The fourth is that Iran's nuclear programs have now reached the stage where they can only be stopped through military strikes -- probably Israeli -- or an internal political decision to abandon them. The prospect of another Mideast war can't exactly please the administration. So how about trying to achieve the same result by leveraging point No. 3?

Maybe ordinary Iranians welcome Mr. Obama's solicitude. What they need is Mr. Obama's spine. If that means "democracy promotion" and tough talk about "regime change," well, it wouldn't be the first time this president has made his predecessor's policy his own.


2)We'll Need to Raise Taxes Soon: Expect Congress to seriously consider a value-added tax.
By ROGER C. ALTMAN

Only five months after Inauguration Day, the focus of Washington's economic and domestic policy is already shifting. This reflects the emergence of much larger budget deficits than anyone expected. Indeed, federal deficits may average a stunning $1 trillion annually over the next 10 years. This worsened outlook is stirring unease on Main Street and beginning to reorder priorities for President Barack Obama and the Democratic congressional leadership. By 2010, reducing the deficit will become their primary focus.

Why has the deficit outlook changed? Two main reasons: The burst of spending in recent years and the growing likelihood of a weak economic recovery. The latter would mean considerably lower federal revenues, the compiling of more interest on our growing debt, and thus higher deficits. Yes, the President's Council of Economic Advisors is still forecasting a traditional cyclical recovery -- i.e., real growth of 3.2% next year and 4% in 2011. But the latest data suggests that we're on a much slower path. Probably along the lines of the most recent Goldman Sachs and International Monetary Fund forecasts, whose growth rates average about 2% for 2010-2011.

A speedy recovery is highly unlikely given the financial condition of American households, whose spending represents 70% of GDP. Household net worth has fallen more than 20% since its mid-2007 peak. This drop began just when household debt reached 130% of income, a modern record. This lethal combination has forced households to lower their spending to reduce their debt. So far, however, they have just begun to pay it down. This implies subdued spending and weak national growth for some time.

In a March 27 forecast, Goldman Sachs estimated average annual deficits of $940 billion through 2019. If this proves true, deficits would remain above 4% of GDP through the next decade and the national debt would reach a whopping 83% of GDP, a level not seen since World War II. The public is restive over this threat: In a recent Wall Street Journal/NBC News poll, Americans were asked which economic issue facing the country concerned them most. Respondents chose deficit reduction over health care by a ratio of 2 to 1.

Mr. Obama and his economic advisers understand this deficit outlook and undoubtedly view it as unsustainable. They also understand that increasing deficit concerns complicate their efforts toward universal health-insurance legislation, which is clearly a top priority of this administration. According to the Congressional Budget Office, which released its latest forecast June 16, such legislation would mandate more than $1 trillion of new federal spending over 10 years. Winning support for that much new spending -- in the face of record deficits -- will be a challenge.

This explains why the president is stressing the importance of a deficit-neutral bill. In other words, that any new spending be fully offset by a combination of Medicare and Medicaid cuts and new tax revenues. Key Senate leaders have echoed this requirement. Fully financed legislation probably will emerge after a lengthy struggle.

The poor budget outlook may impel the administration to follow up health-care legislation with an effort to fix Social Security. The shortfall in Social Security's trust funds -- which adds to the long-term deficit -- is much smaller than the companion problem in Medicare funding. Public anxiety over deficits may make this fix possible now even though it has been elusive for years. If this could be done, confidence in Washington's capacity to address its debt challenge would rise.

But even with a Social Security fix the medium-term deficit outlook will be poor. Sometime soon, perhaps in 2010, Main Street and financial markets will exert irresistible pressure to reduce the deficit.

The problem is the deficit's sheer size, which goes way beyond potential savings from cuts in discretionary spending or defense. It's entirely possible that Medicare and Social Security will already have been addressed, and thus taken off the table. In short we'll have to raise taxes.

Today, the U.S. ranks next to last among the 28 Organization for Economic Cooperation and Development nations in total federal revenue as a share of GDP. Our federal revenues represent 18% of national output, down from 20% just 10 years ago. That makes the mismatch between our spending and our revenue very large, producing the huge deficits we face.

We all know the recent and bitter history of tax struggles in Washington, let alone Mr. Obama's pledge to exempt those earning less than $250,000 from higher income taxes. This suggests that, possibly next year, Congress will seriously consider a value-added tax (VAT). A bipartisan deficit reduction commission, structured like the one on Social Security headed by Alan Greenspan in 1982, may be necessary to create sufficient support for a VAT or other new taxes.

This challenge may be the toughest one Mr. Obama faces in his first term. Fortunately, the new president is enormously gifted. That's important, because it is no longer a matter of whether tax revenues must increase, but how.

Mr. Altman, founder and chairman of Evercore Partners, was deputy secretary of the Treasury in the first Clinton administration.


3)Firefighter Justice: The Supremes, Sotomayor, and racial jurisprudence

The Supreme Court closed an otherwise unremarkable term on a high note yesterday, rejecting the notion that one kind of racial bias can be remedied by another. On the last day of opinions before the Court is potentially joined by Judge Sonia Sotomayor, the Justices overturned one of her most closely scrutinized cases on workplace discrimination. The effect was to take an important step away from the practice of divvying up jobs by race.

Writing for a 5-4 majority in Ricci v. deStefano, Justice Anthony Kennedy said that the city of New Haven violated civil-rights law when it threw out firefighter promotional exams because more whites than blacks or Hispanics had passed the tests. New Haven claimed it had to junk the tests because certifying the results would lead to an avalanche of lawsuits by black candidates who hadn't passed. In other words, the city claimed it had to intentionally discriminate against white candidates out of fear that the tests unintentionally had a "disparate impact" against minorities.

Associated Press Frank Ricci
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But the Court found no evidence that the tests were flawed or that better alternatives for promotion existed. On the contrary, employment tests are an important tool against the very kind of racial discrimination that civil-rights laws were designed to prevent. "Fear of litigation alone cannot justify an employer's reliance on race to the detriment of individuals who passed the examinations and qualified for promotions," Justice Kennedy wrote. The Supremes created this "disparate impact" reverse discrimination incentive with its 1971 Griggs decision, since codified into law, but at least five Justices are still able to object to this kind of blatant racial injustice.

In the opening of her dissent, Justice Ruth Bader Ginsburg writes that "the white firefighters who scored high on New Haven's promotional exams understandably attract this Court's sympathy." To which Justice Samuel Alito replied in a majority concurring opinion that "'Sympathy' is not what petitioners have a right to demand. What they have a right to demand is evenhanded enforcement of the law -- of Title VII's [of the 1964 Civil Rights Act] prohibition against discrimination based on race. And that is what, until today's decision, has been denied them."

Justice Alito underscores how little attention the firefighters' claim was given by lower courts. In 2006 a federal district court dismissed the case before it went to trial. A three judge panel of the Second Circuit Court of Appeals that included Judge Sotomayor then upheld the lower court's judgment in a one-paragraph statement, and later a terse opinion parroting the district court.

The dismissive treatment of the firefighters' claim drew the censure of fellow Second Circuit Judge Jose Cabranes. A former mentor of Ms. Sotomayor, Mr. Cabranes said the court had "failed to grapple with issues of exceptional importance."

On this question of the Second Circuit's mishandling, the Justices agreed unanimously yesterday. In footnote 10 of her dissent, Justice Ginsburg wrote that while she disagreed with the decision to reverse the lower court ruling, there were questions about how it was decided. Based on the lower court's mistaken focus on intent, she wrote, "ordinarily a remand for fresh consideration would be in order."

Judge Sotomayor's handling of the case deserves to be thoroughly aired during her confirmation hearings, insofar as it reinforces concerns that she is prone to race-conscious jurisprudence. The issue originally came to the fore over the judge's remarks that a "wise Latina" would come to a better conclusion than a white male judge who would lack the proper empathy for certain kinds of defendants.

Ms. Sotomayor's supporters have been at pains to argue that she has ended up on both sides of racial discrimination complaints while on the Second Circuit. But those examining her record can reasonably ask if the disregard she exhibited for a Title VII claim by white firefighters falls into the category of neutrality or its own kind of bias.

Because the Court's ruling was narrowly made on statutory grounds, it dodged the larger claim brought by the firefighters that New Haven violated their constitutional right to equal protection. Yet as Justice Antonin Scalia notes in his concurrence, the disparate impact standards "place a racial thumb on the scales, often requiring employers to evaluate the racial outcomes of their policies, and to make decisions based on (because of) those racial outcomes." Someone should ask Judge Sotomayor if that's her idea of equal protection under the law.

3a) On Race, The Slog Goes On
By George Will

Although New Haven's firefighters deservedly won in the Supreme Court, it is deeply depressing that they won narrowly -- 5-4. The egregious behavior by that city's government, in a context of racial rabble-rousing, did not seem legally suspect to even one of the court's four liberals, whose harmony seemed to reflect result-oriented rather than law-driven reasoning.

The undisputed facts are that in 2003 the city gave promotion exams to 118 firemen, 27 of them black. The tests were prepared by a firm specializing in employment exams and were validated, as federal law requires, by independent experts. When none of the African-Americans did well enough to qualify for the available promotions, a black minister allied with the seven-term mayor warned of a dire "political ramification" if the city promoted from the list of persons (including one Hispanic) that the exams identified as qualified. The city decided that no one would be promoted, calling this a race-neutral outcome because no group was disadvantaged more than any other.

The city's idea of equal treatment -- denying promotions equally to those deemed and those not deemed qualified -- was particularly galling to Frank Ricci, who had prepared for the exams by quitting his second job, buying the more than $1,000 worth of books the city recommended, paying to have them read onto audiotapes -- he is dyslexic -- and taking practice tests and interviews. His efforts earned him the sixth-highest score.

He and others denied promotions for which their exam scores made them eligible sued, charging violations of the Constitution's guarantee of equal protection of the laws and of the 1964 Civil Rights Act. The city argued that if it had made promotions based on the test results, it would have been vulnerable under the 1964 act to being sued for adopting a practice that had a "disparate impact" on minorities. On Monday, the court's conservatives (Anthony Kennedy writing for the majority, joined by John Roberts, Antonin Scalia, Clarence Thomas and Samuel Alito) held:

The rights of Ricci et al. under the 1964 act were violated. The city's fear of a disparate impact litigation was not unfounded, but that did not justify the race-based response to the exam results because New Haven did not have "a strong basis in evidence" to believe it would be held liable. There is such evidence only if the exams "were not job related and consistent with business necessity, or if there existed an equally valid, less discriminatory alternative" that would have served the city's needs but that it refused to adopt.

"All the evidence demonstrates that the city rejected the test results because the higher scoring candidates were white." The city's criticisms of the exam "are blatantly contradicted by the record." And "the city turned a blind eye to evidence supporting the exams' validity" (emphases added).

Ruth Bader Ginsburg, joined in dissent by John Paul Stevens, David Souter and Stephen Breyer, rejected the majority's conclusions root and branch. She cited a federal report from the early 1970s about discrimination in hiring firefighters, disputed even the "business necessity" of the exams' 60/40 written/oral ratio and defended the integrity of New Haven's decision-making -- rejecting Alito's concurrence, which dwelt on the rancid racial politics of the Rev. Boise Kimber. Alito concluded that "no reasonable jury" could find that the city possessed a "substantial basis in evidence to find the tests inadequate."

Scalia, concurring separately, said Monday's ruling "merely postpones the evil day" on which the court must decide "whether, or to what extent," existing disparate-impact law conflicts with the 14th Amendment guarantee of equal protection of the law. Conceding that "the question is not an easy one," Scalia said: The federal government is prohibited from discriminating on the basis of race, so surely "it is also prohibited from enacting laws mandating that third parties" -- e.g., a city government -- "discriminate on the basis of race." Scalia added:

"Would a private employer not be guilty of unlawful discrimination if he refrained from establishing a racial hiring quota but intentionally designed his hiring practices to achieve the same end? Surely he would. Intentional discrimination is still occurring, just one step up the chain."

The nation shall slog on, litigating through a fog of euphemisms and blurry categories (e.g., "race-conscious" actions that somehow are not racial discrimination because they "remedy" discrimination that no one has intended). This is the predictable price of failing to simply insist that government cannot take cognizance of race.


3b)Obama thaw on Israeli settlement construction follows Iran setback, Saudi brush-off

The Obama administration signalled a new mood of compromise on settlement construction just ahead of the key talks in New York between Israel's defense minister Ehud Barak and prime minister's adviser Yitzhak Molcho and US envoy George Mitchell Tuesday, June 30.

While the Israeli delegation was still airborne, the US state department spokesman Ian Kelly said: "We've been working with all the parties to try and come up with... an environment conducive to the resumption of negotiations. I'm not going to prejudge what happens tomorrow."

Asked by reporters if that meant the US administration was ready to compromise and accept a suspension of settlement activity instead of a total halt, Kelly said that some level of flexibility was part of the negotiation process.

"Working our way to our resolution, I'm not going to say we're not going to compromise. Let's just see what happens."

At the White House, spokesman Robert Gibbs said: "I don't want to get ahead of some very important meetings tomorrow between Ehud Barak and George Mitchell, except to say that we're optimistic about making progress."

Political analysts attribute this large crack in US president Barack Obama's unswerving push for a total halt on settlement activity on the West Bank to four new developments:

1. The prospect of direct US-Iranian dialogue on the nuclear issue has vanished into the blue yonder as relations go from bad to worse in the aftermath of Iran's disputed presidential election. A tough US stance against Israel as a bargaining chip with Iran is no longer relevant.

2. Saudi Arabia has made it clear that even if the Netanyahu government surrenders to the US demand for a total halt in settlement activity, Arab concessions will not be forthcoming. There will be no visas for Israeli tourists or permission for Israeli airliners heading east to transit Saudi skies.

The Obama administration had factored Arab reciprocity into its campaign to halt Israel's settlement activity. When it was denied, the White House saw no point in continuing to lean on Israel.

3. More and more former Bush administration officials are challenging the administration's insistent denial of Bush administration understandings with Israel on settlement expansion to accommodate natural growth. These officials emphasize that the understandings exist both orally and in writing.

4. Prime minister Binyamin Netanyahu, backed by government and popular majority, stuck to his guns and resisted Barack Obama's demand to halt settlement activity of any kind.

Monday, June 29, the Washington Post offered three reasons for the White House's decision to ease up on its "absolutist" position:

"First, it has allowed Palestinian and Arab leaders to withhold the steps they were asked for… Second, the administration's objective… is unobtainable… No Israeli government has ever agreed to an unconditional freeze and no coalition could be assembled… to impose one. Finally, the extraction of a freeze from Netanyahu is, as a practical matter unnecessary… both the Palestinian Authority and Arab governments have gone along with previous US-Israeli deals by which construction was to be limited to inside the periphery of settlements near Israel - since everyone knows those areas will be annexed to Israel in a final settlement…"

In view of the US administration's newfound flexibility on the settlement issue, Israeli government circles see the tables turned and the American squeeze deflected to coercing the Palestinian Authority to return to the negotiating table.

Egypt has set July 7 as the deadline for the warring Palestinian factions - Mahmoud Abbas' Fatah and the Islamist Hamas which rules Gaza - to get their act together and achieve a united national front ahead of peace talks with Israel.

Netanyahu, after accepting the two-state principle, pulling Israeli troops out of four Palestinian towns, thinning out West Bank roadblocks and making his point to Washington on the settlement freeze, is ready to invite the opposition Kadima party and its leader, Tzipi Livni, to join a national unity government under his rule.

Foreign minister Avigdor Liebermann and his nationalist Israeli Beitenu party might present an obstacle. Therefore, some political circles in Jerusalem assign the anonymous leak to the media Monday, June 29, which cited French president Nicolas Sarkozy as bluntly advising Netanyahu when they met at the Elysee last week to get rid of Avigdor Lieberman and replace him with Kadima leader Tzipi Livni, as a prod for Lieberman to step aside.

3c) Ideologue-in-Chief
By Caroline B. Glick


While Obama's supporters champion his "realist" policies as a welcome departure from the "cowboy diplomacy" of the Bush years, the fact of the matter is that in country after country, Obama's supposedly pragmatic and non-ideological policy has either already failed — as it has in North Korea — or is in the process of failing

For a brief moment it seemed US President Barack Obama was moved by the recent events in Iran. On Friday, he issued his harshest statement yet on the mullocracy's barbaric clampdown against its brave citizens who dared to demand freedom in the aftermath of June 12's stolen presidential elections.

Speaking of the protesters Obama said, "Their bravery in the face of brutality is a testament to their enduring pursuit of justice. The violence perpetrated against them is outrageous. In spite of the government's efforts to keep the world from bearing witness to that violence, we see it and we condemn it."

While some noted the oddity of Obama's attribution of the protesters' struggle to the "pursuit of justice," rather than the pursuit of freedom - which is what they are actually fighting for — most Iran watchers in Washington and beyond were satisfied with his statement.

Alas, it was a false alarm. On Sunday Obama dispatched his surrogates — presidential adviser David Axelrod and UN Ambassador Susan Rice — to the morning talk shows to make clear that he has not allowed mere events to influence his policies.

After paying lip service to the Iranian dissidents, Rice and Axelrod quickly cut to the chase. The Obama administration does not care about the Iranian people or their struggle with the theocratic totalitarians who repress them. Whether Iran is an Islamic revolutionary state dedicated to the overthrow of the world order or a liberal democracy dedicated to strengthening it, is none of the administration's business.

Obama's emissaries wouldn't even admit that after stealing the election and killing hundreds of its own citizens, the regime is illegitimate. As Rice put it, "Legitimacy obviously is in the eyes of the people. And obviously the government's legitimacy has been called into question by the protests in the streets. But that's not the critical issue in terms of our dealings with Iran."

No, whether an America-hating regime is legitimate or not is completely insignificant to the White House. All the Obama administration wants to do is go back to its plan to appease the mullahs into reaching an agreement about their nuclear aspirations. And for some yet-to-be-explained reason, Obama and his associates believe they can make this regime — which as recently as Friday called for the mass murder of its own citizens, and as recently as Saturday blamed the US for the Iranian people's decision to rise up against the mullahs — reach such an agreement.

IN STAKING out a seemingly hard-nosed, unsentimental position on Iran, Obama and his advisers would have us believe that unlike their predecessors, they are foreign policy "realists." Unlike Jimmy Carter, who supported the America-hating mullahs against the America-supporting shah 30 years ago in the name of his moralistic post-Vietnam War aversion to American exceptionalism, Obama supports the America-hating mullahs against the America-supporting freedom protesters because all he cares about are "real" American interests.

So too, unlike George W. Bush, who openly supported Iran's pro-American democratic dissidents against the mullahs due to his belief that the advance of freedom in Iran and throughout the world promoted US national interests, Obama supports the anti-American mullahs who butcher these dissidents in the streets and abduct and imprison them by the thousands due to his "hard-nosed" belief that doing so will pave the way for a meeting of the minds with their oppressors.

Yet, Obama's policy is anything but realistic. By refusing to support the dissidents, he is not demonstrating that he is a realist. He is showing that he is immune to reality. He is so committed to appeasing the likes of Mahmoud Ahmadinejad and Ali Khamenei that he is incapable of responding to actual events, or even of taking them into account for anything other than fleeting media appearances meant to neutralize his critics.

Rice and Axelrod demonstrated the administration's determination to eschew reality when they proclaimed that Ahmadinejad's "reelection" is immaterial. As they see it, appeasement isn't dead since it is Khamenei — whom they deferentially refer to as "the supreme leader" — who sets Iran's foreign policy.

While Khamenei is inarguably the decision maker on foreign policy, his behavior since June 12has shown that he is no moderate. Indeed, as his post-election Friday "sermon" 10 days ago demonstrated, he is a paranoid, delusional America-bashing tyrant. In that speech he called Americans "morons" and accused them of being the worst human-rights violators in the world, in part because of the Clinton administration's raid on the Branch Davidian compound in Waco, Texas in 1993.

Perhaps what is most significant about Obama's decision to side with anti-American tyrants against pro-American democrats in Iran is that it is utterly consistent with his policies throughout the world. From Latin America to Asia to the Middle East and beyond, after six months of the Obama administration it is clear that in its pursuit of good ties with America's adversaries at the expense of America's allies, it will not allow actual events to influence its "hard-nosed" judgments.

TAKE THE ADMINISTRATION'S response to the Honduran military coup on Sunday. While the term "military coup" has a lousy ring to it, the Honduran military ejected president Manuel Zelaya from office after he ignored a Supreme Court ruling backed by the Honduran Congress which barred him from holding a referendum this week that would have empowered him to endanger democracy.

Taking a page out of his mentor Venezuelan dictator Hugo Chavez's playbook, Zelaya acted in contempt of his country's democratic institutions to move forward with his plan to empower himself to serve another term in office. To push forward with his illegal goal, Zelaya fired the army's chief of staff. And so, in an apparent bid to prevent Honduras from going the way of Daniel Ortega's Nicaragua and becoming yet another anti-American Venezuelan satellite, the military — backed by Congress and the Supreme Court — ejected Zelaya from office.

And how did Obama respond? By seemingly siding with Zelaya against the democratic forces in Honduras who are fighting him. Obama said in a written statement: "I am deeply concerned by reports coming out of Honduras regarding the detention and expulsion of president Mel Zelaya."

His apparent decision to side with an anti-American would-be dictator is unfortunately par for the course. As South and Central America come increasingly under the control of far-left America-hating dictators, as in Iran, Obama and his team have abandoned democratic dissidents in the hope of currying favor with anti-American thugs. As Mary Anastasia O'Grady has documented in The Wall Street Journal, Obama and Secretary of State Hillary Clinton have refused to say a word about democracy promotion in Latin America.

Rather than speak of liberties and freedoms, Clinton and Obama have waxed poetic about social justice and diminishing the gaps between rich and poor. In a recent interview with the El Salvadoran media, Clinton said, "Some might say President Obama is left-of-center. And of course that means we are going to work well with countries that share our commitment to improving and enhancing the human potential."

But not, apparently, enhancing human freedoms.

FROM IRAN to Venezuela to Cuba, from Myanmar to North Korea to China, from Sudan to Afghanistan to Iraq to Russia to Syria to Saudi Arabia, the Obama administration has systematically taken human rights and democracy promotion off America's agenda. In their place, it has advocated "improving America's image," multilateralism and a moral relativism that either sees no distinction between dictators and their victims or deems the distinctions immaterial to the advancement of US interests.

While Obama's supporters champion his "realist" policies as a welcome departure from the "cowboy diplomacy" of the Bush years, the fact of the matter is that in country after country, Obama's supposedly pragmatic and nonideological policy has either already failed — as it has in North Korea — or is in the process of failing. The only place where Obama may soon be able to point to a success is in his policy of coercing Israel to adopt his anti-Semitic demand to bar Jews from building homes in Jerusalem, Judea, and Samaria. According to media reports, Prime Minister Binyamin Netanyahu has authorized Defense Minister Ehud Barak to offer to freeze all settlement construction for three months during his visit to Washington this week.

Of course, in the event that Obama has achieved his immediate goal of forcing Netanyahu to his knees, its accomplishment will hinder rather than advance his wider goal of achieving peace between Israel and its neighbors. Watching Obama strong-arm the US's closest ally in the region, the Palestinians and the neighboring Arab states have become convinced that there is no reason to make peace with the Jews. After all, Obama is demonstrating that he will deliver Israel without their having to so much as wink in the direction of peaceful coexistence.

So if Obama's foreign policy has already failed or is in the process of failing throughout the world, why is he refusing to reassess it? Why, with blood running through the streets of Iran, is he still interested in appeasing the mullahs? Why, with Venezuela threatening to invade Honduras for Zelaya, is he siding with Zelaya against Honduran democrats? Why, with the Palestinians refusing to accept the Jewish people's right to self-determination, is he seeking to expel some 500,000 Jews from their homes in the interest of appeasing the Palestinians? Why, with North Korea threatening to attack the US with ballistic missiles, is he refusing to order the *USS John McCain* to interdict the suspected North Korean missile ship it has been trailing for the past two weeks? Why, when the Sudanese government continues to sponsor the murder of Darfuris, is the administration claiming that the genocide in Darfur has ended? The only reasonable answer to all of these questions is that far from being nonideological, Obama's foreign policy is the most ideologically driven since Carter's tenure in office. If when Obama came into office there was a question about whether he was a foreign policy pragmatist or an ideologue, his behavior in his first six months in office has dispelled all doubt. Obama is moved by a radical, anti-American ideology that motivates him to dismiss the importance of democracy and side with anti-American dictators against US allies.

For his efforts, although he is causing the US to fail to secure its aims as he himself has defined them in arena after arena, he is successfully securing the support of the most radical, extreme leftist factions in American politics.

Like Carter before him, Obama may succeed for a time in evading public scrutiny for his foreign-policy failures because the public will be too concerned with his domestic failures to notice them. But in the end, his slavish devotion to his radical ideological agenda will ensure that his failures reach a critical mass.

And then they will sink him.

JWR contributor Caroline B. Glick is the senior Middle East Fellow at the Center for Security Policy in Washington, DC and the deputy managing editor of The Jerusalem Post. Comment by clicking here.


4) Sarkozy slammed for Lieberman 'remark


Prime Minister Binyamin Netanyahu's spokesman, Nir Hefetz, would not confirm or deny the report that French President Nicolas Sarkozy urged Netanyahu to "get rid of" Foreign Minister Avigdor Lieberman in their meeting in Paris last week. But he told Army Radio Tuesday that "the prime minister doesn't feel he needs advice on his government from outside sources" and "holds Foreign Minister Lieberman in great esteem."

Lieberman's spokesman Tzahi Moshe said the comments, "if true," represented "intolerable" meddling in Israel's internal affairs.

Lieberman has ordered his subordinates not to publicly respond further to the remarks to prevent diplomatic tensions, one senior Israeli official said.

The official spoke on condition of anonymity since the contents were part of private conversations.

Israel Beiteinu No. 2 Uzi Landau came to the defense of his party leader on Tuesday morning, blasting the comments attributed to Sarkozy.

"It's difficult for me to believe that a leader of a friendly country can make such remarks, but were I the prime minister, and such comments were made in my presence, I would bang on the table and protest," he told Army Radio. "That's how a prime minister should conduct himself to preserve his country's honor."

Sarkozy's office wouldn't immediately comment on his discussions with Netanyahu. It is not unusual for the French leader to discuss countries' internal political matters with foreign government leaders.

Another close associate of Lieberman on Monday night blasted the comments reportedly made by Sarkozy.

"If the words attributed to the French president are correct, then the intervention of the president of a respected, democratic state in the affairs of another democratic state is grave and unacceptable," he said. "We expect that - regardless of political affiliation - all political bodies in Israel condemn this callous intervention of a foreign state in our internal affairs."

The Prime Minister's Office denied the Channel 2 report, according to which Sarkozy had told Netanyahu, "You need to get rid of this man...You need to remove him from this position."

Sarkozy had apparently taken issue with some of Lieberman's fringe political stances, the television channel reported, and he said that opposition leader Tzipi Livni was a far better choice for the position of foreign minister. In response, Netanyahu was quoted as telling the French leader that Lieberman "sounds really different" in private conversations.

The French president, undeterred, reportedly retorted that even Jean-Marie Le Pen, the founder and president of France's National Front party, is a nice person in private conversations.

Spend What We Don't Have to Fund What We Can't Afford!

Obama will not do a thing about Iran but he can pressure Netanyahu and continues to do so. By the time Netanyahu negotiates with Abbas he will have little leverage. (See 1 and 1a below.)

Hamas' man behind the scene, Mashaal, rejects Netanyahu's proposals as one would expect. Mashaal knows by remaining opposed to everything Israel seeks the pressure from Obama will mount on Netanyahu to make more concessions. After all, getting a deal signed is politically critical regardless of whether it is good for our former friend. (See 2 and 2a below.)

Karl Rove is a very bright political observer and analyst but I believe he is too optimistic when it comes to Obama's health care initiatives faltering. Democrats love passing laws and dispensing goodies. By spending money we don't have, to fund programs we can't afford places Democrats in the perfect position of raising taxes and expanding government's intrusion into every nook and cranny of life and that is something they lust at doing. (See 3 and 5 below.)

Caroline Glick suggests the divide between Israelis and American Jews, regarding support of Israel, has widened.

Most American Jews are liberal and, unless Israel's very existence is imminently threatened, their loyalty is to their party's president. Furthermore, I suspect most liberal American Jews have become tired of "active" support of Israel which would make them vulnerable to criticism because they have bought into the growing and constant bashing emanating from the press and media elite that Israel is an intransigent occupier and bully. Most American Jews are urbanites, somewhat educated and live in cities where newspapers are predominantly liberal - New York Times, Los Angeles Times, etc..

Most American Jews, being liberal, perhaps feel a greater sense of guilt, sympathy and/or empathy when it comes to minorities and therefore, are not likely to challenge Obama whose heart they want to believe remains in the 'right place.' They delude themselves by citing Obama's Jewish Chief of Staff but ignore Obama's actions, background, associations and speeches.

Most American Jews have never been to Israel. In fact a greater percentage of Congress has been and have come back influenced by their visit and the geography. We live in a vast country and cannot perceive of a nation as small as Israel. Neither is America surrounded by those committed to our extinction. Yes, we are invaded by illegals from Mexico but they come not to destroy our nation but to find work.

Supporting Israel raises the issue of loyalty and that too causes problems among liberal Jews. Another reason for the growing divide is that it is hard to continue supporting the victor against the 'victim' and the Palestinians have done a marvelous job of selling their victimhood to a buying world.

Perhaps, as Glick suggests, a campaign of education will help narrow the exanding gap but I believe the odds favor Obama because he has momentum, is hell bent to force a deal and has demonstrated a willingness to sacrifice principle because 'father knows best.'


Most importantly of all, as Glick points out, most Jews either never embraced Zionism or have forgotten what Zionism sought to do. Therefore, Obama's mischaracterization of his justification of Israel's birth goes right over their heads. If you do not know your history you are not in a strong position to debate an attack on or misrepresentation of it.

And then read the most damning article of all.(See 4 and 4a below.)

The Senate is about to claim a 'partisan' victory by saving us $600 billion and passing a health care bill which will only costs $1 trillion over ten years. No Congressional estimate has ever turned out to be correct or low so you can start by doubling the trillion figure and then, oops we not only did not save $600 billion but also, like in a poker game, got raised $400 billion. But we can afford it because the wealthy are going to foot the bill from their pocket change.

The Baucus bill is short on details, in fact it has none because it is the stuff dreams are made of, but Baucus is delirious over his accomplishments.(See 5 and 5a below.)

As government begins controlling more corporations and their activity it will be interesting to observe whether corporate management, hired by the government, can adapt to the growing spread of pernicious rules and regulations demanded of the private sector. Certainly members of Congress enjoy special privileges unavailable to the governed - even to the extent of health care choices etc.

Take the case of AIG. The government has now converted significant portions of their loans to equity and now control what was once one of the largest publicly traded insurance companies. Government already controls General Motors and through Fannie Mae and Freddie Mac dictates what happens in the mortgage lending market and recently Barney sought to ease restrictions on condo lending.

Being the cynic that I am, I suspect, over time, we will find government management will engage in abusive and illegal activities and that goivernment oversight of their own will turn a blind eye and/or be in cahoots. After all Dodd and others recieved sweetheart interest deals from Countrywide whose head will probably go to jail.

Obama has created the perverse condition whereby government is increasingly in bed with itself and is being entrusted to watch itself. What bureaucrat will blow the whistle on its own? Just in the past few weeks it has come to light that Obama is seeking to fire a Justice Department Inspector General who accused one of Obama's Acorn supporters of law violations. This individual was appointed by GW and it is claimed was overzealous in his complaint against the Obama supporter who received improper Acorn funding that has since been repaid.

Oversight has become a function of an adoring and supporting press and media and you know where that will lead us - nowhere. All administration have instances of corruption and self-dealing. I suspect when history is written this one will exceed anything ever dreamed of because of the trillions that are sloshing around in the hands of and under the control of those who now govern.

Paying off constituents is politics at its finest and think about all that Obama owes to unions, the Far Left, (Greens, Acorns and other assorted nuts)and you should begin to get the picture if you even care. (See 6 and 6a below.)

Have a nice weekend and breathe what is left of the free air because soon you will be paying for every breath you take under Cap and Trade.

Dick


1) Netanyahu folds under US pressure for pulling out of West Bank towns before peace talks

Despite his pledge to keep security considerations uppermost in his dealings with the Palestinians, Israeli prime minister Binyamin Netanyahu is buckling under pressure from the US administration aimed at softening Israel up ahead of Middle East peace talks.

This pressure turned Netanyahu's first official visits to Rome and Paris sour.

He had hoped to outmaneuver the Obama administration's insistence on a total settlement freeze by winning the support of friendly Silvio Berlusconi and Nicolas Sarkozy for a compromise formula, which would be presented as a European-Israel deal.

To achieve this, he promised the Italian and French leaders that Israeli forces would soon be pulled out of West Bank Palestinian towns. But he failed to anticipate that the Obama administration would outflank him and get there first. So his arrival in Rome and Paris was preceded by Italian and French officials parroting the Washington line on a settlement freeze, including East Jerusalem

When he met Berlusconi Monday, June 22, the Israeli prime minister saw that he had already talked to Obama on the phone and promised that the Italian boot would toe the American line.

In Paris, he found the same trap had been laid at the Elysee.

In these circumstances, Netanyahu should never have gone through with his visits to Italy and France. And defense minister Ehud Barak should call off his trip to Washington Monday for the interview with US Middle East envoy George Mitchell which the prime minister postponed. He has little hope of persuading the administration to change its tune or head off the impending clash between his administration and the Obama White House.

Netanyahu's promise to the Italian and French leaders to pull the IDF out of the West Bank cities of Ramallah, Bethlehem, Jericho and Qalqilya, has meanwhile gone on record, for no gain in Rome and/or in Paris. Netanyahu can no longer capitalize on this major concession for a quid pro quo from the Palestinians. The IDF has also been ordered to reduce to the number of checkpoints on the West Bank to 10 active facilities to allow the Palestinians to travel from town to town free of holdups for searches – another concession to US demands.

These concessions are tantamount to the handover of the main West Bank towns to Palestinian security control.

It is the most sweeping redeployment of Israeli security forces since their unilateral withdrawal from the Gaza Strip and northern Samaria four years ago as part of Ariel Sharon's disengagement policy.

To make the gesture palatable to the Israeli public - who have not forgottenthat years of Palestinian suicide bombing attacks from the West Bank were finally stemmed by the IDF presence in terrorist city strongholds - Netanyahu told the army spokesman to announce Thursday, June 25, that the measures were being given a one-week trial run before being finalized.

However, once in place, these measures will be practically impossible to withdraw.

The Obama administration has thus cornered the Netanyahu government into giving away valuable assets to the Palestinians before negotiations have even begun. This diplomatic dexterity has not been displayed in Washington's dealings with Iran.


1a) U.S. praises Israel for easing West Bank restrictions
By Natasha Mozgavaya


In an apparent effort to ease tensions that have been aired publicly through the press, the U.S. State Department on Thursday praised Israel's lifting of restrictions on Palestinian movement in the West Bank.

State Department spokesperson Ian Kelly said the U.S. was appreciative of Israel's "positive steps" in easing Palestinian freedom of movement in the territories.

Relations between Israel and the United States have been strained in recent weeks over Washington's demand that the Netanyahu government declare a total freeze on all settlement construction in the West Bank.

A Paris meeting between Prime Minister Benjamin Netanyahu and U.S. President Barack Obama's envoy to the Middle East, George Mitchell, was canceled earlier this week after it became clear that the two sides would not be able to bridge the gaps on the settlement issue.

Netanyahu announced earlier this week that he would dispatch his defense minister, Ehud Barak, to Washington in an effort to reach a compromise with American officials on the settlements issue.

Israel plans to limit military operations in four Palestinian cities to try to boost a Palestinian security campaign supported by Washington, Israeli and Western security sources said on Thursday.

The move coincided with attempts by Netanyahu to persuade Obama to soften his demand for a total freeze in settlement building in the Israeli-occupied West Bank.

Israeli and Western sources said the Israel Defense Forces would refrain from entering Bethlehem, Ramallah, Jericho and Qalqilya, except in cases where the army believed Palestinian militants were poised to attack Israelis. The move stops short of a full withdrawal from these towns.

The United Nations Office for the Coordination of Humanitarian Affairs (OCHA) announced yesterday that the Israeli authorities had somewhat eased travel restrictions for Palestinians to and from four cities in the West Bank: Jericho, Ramallah, Nablus and Qalqilyah.

However OCHA also said that the Israel Defense Forces claim that there are only 16 manned roadblocks in the West Bank is incorrect. According to OCHA there are 69 manned roadblocks

2) Mashaal rejects idea of demilitarized Palestine as 'pathetic'
By Ali Waked


Exiled Hamas politburo chief responds to Obama, Netanyahu speeches, says Palestinians 'reject Israel's position on the refugees, Jerusalem, and the Jewish state.' Gilad Shalit will only be released as part of 'a serious deal'

Hamas' senior political leader Khaled Mashaal said on Thursday that his organization is willing to cooperate with any international effort to end the occupation but would never accept the notion of a demilitarized Palestinian state.


"The Palestinian people reject the Israeli position on a demilitarized state, on the refugees, on Jerusalem, and on the Jewish state," the exiled Mashaal said in Damascus, referring to Israel's demand any future Palestinian state recognize it as a Jewish nation.

"A demilitarized state is a pathetic state, not a serious national entity. The Palestinians will not accept Jerusalem as a unified city under Jewish control," said Mashaal, adding that the Palestinians were dedicated to returning the refugees to their homes. Recognizing Israel as a Jewish state "would erase the right of return to lands taken in 1948."

Mashaal also spoke of captive Israeli soldier Gilad Shalit. "Netanyahu's only chance to free the soldier is through a serious prisoner exchange agreement," said Mashaal. "So far Israel's stubbornness has derailed the indirect negotiations and most of the other efforts in past years. We will continue to do everything to free the prisoners. Hamas is committed to freeing all 12,000 prisoners."


'Obama's speech – good, but not enough'
Mashaal called US President Barack Obama's demand that Israel freeze all construction in the settlements "positive, but not enough." The Hamas leader said: "The times have changed – Israel can no longer defeat our people and our nations. It has failed in its Nazi war on Gaza just as it failed in Lebanon. This is the result of the resistance, not negotiations that only mask the face of the occupation."


Mashaal addressed Obama directly, saying the Palestinian people "has experienced every form of oppression, suffering and injustice." He expressed his appreciation of the new administration's attitude towards Hamas, calling it a step in the right direction.


Mashaal also called for and end to the blockade imposed on the Hamas-ruled Gaza Strip and its rebuilding.


"President Obama uses new language, but we expect real pressure on the Israelis. There are demands to freeze the settlements, but that is not the price we want, even if it is a necessary step."

Mashaal said the West "is to blame for Israel's extremism."


He urged the warring Palestinian factions to reconcile and unite, he said such a reconciliation has not been reached yet because of the Palestinian Authority's "persecution of the resistance."



Israeli and Palestinian security forces loyal to the PA have boosted cooperation in the West Bank over the course of the past year, and Israel has praised the Palestinian troops' ability to thwart terror attacks and dismantle terror infrastructure, mostly belonging to Islamic Jihad but also Hamas.

2a) Arab hearts & minds

Another day, another massacre in Iraq. Sunni fanatics bombed a Baghdad street market on Thursday, slaughtering 70 Shi'ites. The latest bloodletting comes just as 133,000 US combat forces are to be withdrawn from Iraqi population centers, on Tuesday. The troops will be out of the country altogether in two years.

While world attention has been focused on Iran, Iraqis have continued to kill each other and Americans. In Mosul, the coach of the national karate team was killed; a spate of violence earlier in the week claimed dozens of victims in Baghdad. A truck-bombing in Kirkuk on Saturday took 70 lives. Nor is the situation stable even in Fallujah, pacified at great cost in American lives and treasure.

The Sunnis responsible for recent attacks are mostly locals, not jihadis from abroad, and American intelligence believes that the chances of renewed sectarian warfare are receding. The official US line is that the war in Iraq is winding down and American forces there will be reassigned to Afghanistan.

US DEFENSE Secretary Robert Gates called on a Washington gathering of top military officers from friendly Arab countries to help stabilize Iraq and Afghanistan. He said that Washington's overtures to Iran notwithstanding, America would stick by its Arab allies.

America's dependency on imported petroleum, along with other geostrategic considerations, makes the need for good relations with the Arabs perfectly understandable. Still, isn't the administration curious about why it must work so hard to convince them to do what is in their own interest? After all, were Iraq (with its Shi'ite Arab majority) to fall completely into Iran's (Persian Shi'ite) orbit, this would be a bad thing for the predominantly Sunni Arab states. Likewise, a nuclear-armed Iran would most immediately threaten the Arabs.

On Thursday, Jerusalem Post diplomatic reporter Herb Keinon analyzed the approach Washington has been taking to bolster its credentials with the Arabs. By driving the settlement issue to the forefront, wrote Keinon, President Barack Obama has, paradoxically, made it next to impossible to resume Palestinian-Israeli peace talks.

The Palestinians insist they will not negotiate without a settlement freeze. And the Obama administration seems to have bought the assertion, reiterated at Wednesday's Arab League meeting in Cairo, that if only Jewish life over the Green Line was placed in suspended animation, Palestinian moderates would make a dash for peace.

There are some 550,000 Jews living beyond the Green Line: 300,000 in 120 communities in Judea and Samaria, the rest in metro-Jerusalem. Notwithstanding the shared Israeli and American desire to create a climate conducive to productive negotiations, it makes little sense to many Israelis that the US is demanding a freeze inside the strategic settlement blocs Israel is consensually insistent on retaining, and the extension of that demand to Jewish neighborhoods in post-'67 Jerusalem is still more problematic. Furthermore, all Israeli communities on the Palestinian side of a permanently agreed border would be relocated under the terms of a final status deal.

We suspect the Palestinians do not want to negotiate in good faith - otherwise why did they reject an offer by Ehud Olmert that would have given them the equivalent of 100 percent of the West Bank, plus Israel's agreement to international oversight of Jerusalem's holy basin? And why is Mahmoud Abbas still insisting on Israel agreeing to absorb millions of Palestinian "refugees" - thereby asking us to commit demographic suicide?

In Jordan this week, Saeb Erekat crowed that it was Palestinian negotiating obstinacy that had impelled Olmert's generous offer. The longer we hold out, he said, the better the offers get. In that context, American pressure for a complete Israeli settlement freeze seems likely to deepen Palestinian obduracy, not reduce it.

Fixating on settlements gladdens Arab hearts, no doubt. It will not, however, bring stability to Fallujah or Kabul.

What will? Perhaps a sense of certainty that America will not waver in its determination to lead. Even then, though, Arab collaboration on Iraq, Afghanistan and Iran will still be influenced by factors beyond Washington's control, such as the internecine struggle between Islamists and relative modernizers.

When the Arabs study Washington's handling of Iran's post-election upheaval, or how it's responding to the mullahs' quest for atomic weapons and to North Korea's brinkmanship, will they take heart from Obama's commitment to multilateralism and his dexterous employment of soft power and suasion? Or will they, looking at the results, hedge their bets and disingenuously attribute their vacillation to Jewish settlements on the West Bank?

3) ObamaCare Costs Money--And Personal Freedom
By KARL ROVE


While still good, President Barack Obama's political health is deteriorating, threatened by what he thought would be balm -- his ambitious plan for a government takeover of health care.

Mr. Obama remains slightly more popular than most presidents have been in their opening months. But his job approval rating has drifted down to 60% in the RealClearPolitics.com average. His disapproval numbers have nearly doubled to 33%.

More troubling to Team Obama is the growing gap between the president's approval rating and declining support for major items on his policy agenda. Independents are increasingly joining Republicans in opposition to administration initiatives that range from reviving the economy to closing the terrorist detention facility at Guantanamo.


Things will likely get worse in the coming months as the congressional stage comes to be dominated by health care. A new poll by Resurgent Republic (a nonprofit, right-of-center education organization whose creation I helped spur), reveals some of the president's challenges. By a 60%-to-31% margin, Americans prefer getting their health coverage through private insurance rather than the federal government.

Mr. Obama's record-setting spending binge has also made Americans more sensitive to deficits and higher taxes. Thirty-nine percent said they supported "a health-care plan that raises taxes in order to provide health insurance to all Americans," while 52% preferred "a plan that does not provide health insurance to all Americans but keeps taxes at current levels." By a 58%-to-37% margin, American prefer reforming health care "without raising taxes or increasing the deficit" to government investing "new resources to make sure it is done right."

This is why Senate Finance Committee Chairman Max Baucus blanched when committee staffers priced his -- which is also the Obama administration's -- draft legislation at a cool $1.6 trillion over the next decade.

The federal government will release an update on the deficit in mid-July, which will likely increase the public's fear of deficit spending. The current fiscal year's $1.8 trillion deficit is likely to grow significantly.


There is some good news in the Resurgent Republic poll for Mr. Obama if he can sell his plan as shifting power from "insurance bureaucrats to consumers." Resurgent's poll found that Americans favor that by 57% to 38%.

But to argue, as Mr. Obama does, that a government-run health-care plan can control costs better than a market-based system is a mistake. This argument is belied by Medicare's experience. A study published by the Pacific Research Institute finds that since 1970 Medicare's costs have risen 34% a year faster than the rest of health care.

Mr. Obama's trashing of American health care as "a broken system" that must be brought "into the 21st century" doesn't resonate with most Americans. They are happy about their health care, doctor and hospital. Resurgent's poll found that 83% of Americans are very or somewhat satisfied with the quality of care they and their families receive.

Nearly everyone agrees that some reforms are needed. But it is also vital to protect areas of excellence and innovation. Stanford University professor Scott Atlas points out that from 1998 to 2002 nearly twice as many new drugs were launched in the U.S. as in Europe. According the U.S. Pharmaceutical Industry Report, some 2,900 new drugs are now being researched here. America's five top hospitals conduct more clinical trials than all the hospitals in any other developed country, according to Mr. Atlas. And a McKinsey Co. study reports that 40% of all medical travelers come to the United States for medical treatment.

Transforming health care into a government-run system would be difficult to do under any circumstances. Americans are still wary about big government. Health-care reform also always sounds better in the abstract. Public resistance rises once liberals are forced to release the details of their plans.

Meanwhile, the $787 billion stimulus package has not provided the economic kick Mr. Obama promised. The $410 billion Omnibus spending bill the president signed in March and his $3.5 trillion budget plan for next year are also adding to the river of red ink.

Health-care reform was said to be "inevitable" a few months ago. Today, its prospects are less certain, even to Democrats. The issue may even turn out to be a millstone for the party.

Americans are increasingly concerned about the cost -- in money and personal freedom -- of Mr. Obama's nanny-state initiatives. To strengthen the emerging coalition of independents and Republicans, the GOP must fight Mr. Obama's agenda with reasoned arguments and attractive alternatives. Health care may actually be an issue that helps resurrect the GOP.

Mr. Rove is the former senior adviser and deputy chief of staff to President George W. Bush.

4) Have Israelis and U.S. Jews Parted Company?
By Caroline B. Glick


Have American Jews abandoned Israel in favor of President Obama? This is acentral question in the minds of Israelis today.

In a poll of Israeli Jews conducted in mid-June by the Jerusalem Post, a mere 6 percent of respondents said they view Obama as pro-Israel. In stark contrast, a Gallup tracking poll in early May showed that 79 percent of American Jews support the president.

These numbers seem to tell us that U.S. Jews have indeed parted company with the Jewish state.

No American president has ever been viewed as similarly ill disposed toward Israel by Israelis. With only 6 percent seeing the administration as friendly, it is apparent that distrust of Obama is not a partisan issue in Israel. It spans the spectrum from far left to right, from ultra-Orthodox to ultra-secular. But with his 79-percent approval rating among U.S. Jews, it is clear the American Jewish community is quite sympathetically inclined
toward Obama.

Appearances of course can be deceptive. And it is worth taking a closer look at the numbers to understand what they tell us about American Jewish sentiments regarding Obama and Israel. First, however, we should consider what it is about Obama that makes nearly all Israeli Jews view him as an adversary.

The Jerusalem Post poll showed a massive divergence between Israeli Jews and Obama on the issue of Jewish building beyond the 1949 armistice line. The Obama administration has refused to budge in its hard-line demand that Israel end all Jewish building in north, south, and east Jerusalem as well as in Judea and Samaria.

For its part, the Netanyahu government has refused to bow to this demand. Seventy percent of Israeli Jews support the Netanyahu government's handling of the issue with the Obama administration and 69 percent oppose a freeze on Jewish building.

Beyond Obama's agitation on the issue of Jewish construction, Israelis are dismayed by what they perceive as the generally hostile approach he has adopted in dealing with the Jewish state. This approach was nowhere more in evidence than in his speech to the Islamic world in Cairo on June 4.

It wasn't just Obama's comparison of Palestinian terrorism to the anti-Apartheid movement in South Africa, the American civil rights movement and antebellum slave rebellions that set people off. There was also Obama's inference that Israel owes its legitimacy to the Holocaust.

It is that claim - Obama repeated it during his visit to Buchenwald - which forms the basis of the Islamic narrative against Israel. It argues that Jews are not indigenous to the Middle East, and that the only thing keeping Israel in place is European guilt about Auschwitz. Not only do Israelis of all political stripes reject this as factually false, they recognize it is inherently anti-Semitic because it ignores and negates 3,500 years of Jewish history in the land of Israel.

With Israeli distrust of Obama so apparent, and so easily explained, two questions arise: How has Obama managed to maintain American Jewish support despite his unprecedented unpopularity in Israel? And what is the likelihood that when push comes to shove, American Jews will stand with Israel against the president they so admire?

Obama's great success in maintaining support among American Jews owes much to the fact that most American Jews do not pick up the same messages from Obama's statements as do Israeli Jews. Whereas Israeli Jews recognize that it is morally obscene, strategically suicidal and historically inaccurate to suggest that Israel has no rights to Jerusalem, Judea and Samaria and that Jews have no right to live there, American Jews do not intuitively understand this to be the case. Consequently, while Israeli Jews recognize Obama's calls for a total freeze in Jewish construction in these areas as inherently hostile, most American Jews do not.

Beyond this, for the past 15 years, Holocaust education - more so than Zionist education or Jewish religious education - has become the hallmark of American Jewish identity. As a consequence, American Jews may not see anything objectionable in Obama's inference that Israel owes its existence to the Holocaust.

If the divergence in U.S. Jewish and Israeli attitudes toward Obama is simply a consequence of a lack of American Jewish awareness of the significance of Obama's positions and policies for Israel, then the disparity in views can be easily remedied by a sustained issues awareness campaign by Israel and by American Jewish organizations. For many of Israel's core American Jewish supporters, such a campaign would no doubt go a long way in energizing them to challenge the administration on its positions vis-à-vis Israel.

But there are other factors at work. According to the American Jewish Committee's 2008 survey of American Jews, some 67 percent of American Jews feel close to Israel. These numbers, while high, are not significantly higher than similar support levels among the general U.S. population. (A survey of general American sentiment toward Israel conducted this month by the Israel Project shows that support for Israel has dropped by 20 percent in the past nine months - from 69 to 49 percent. Presumably, Jewish American support for Israel has also experienced a drop.)

More significantly, the AJC survey showed that in the lead-up to the 2008 presidential elections, only three percent of American Jews said a candidate's position on Israel was the most important issue for them. Indeed, according to survey after survey of American Jewish opinion over the past decade, U.S. Jewish support for Israel, while widespread, is not
particularly deep. This sentiment lends to the conclusion that American Jews will not abandon or temper their support for Obama simply because he is perceived as being hostile to Israel.

The picture, then, is a mixed bag. Support for Israel against Obama will likely rise as a consequence of a sustained educational campaign among American Jews about the issues in dispute and their importance for Israel's security and national well-being. But even in that event, it is unclear how dramatic the shift would be. Given the shallowness of U.S. Jewish support for Israel, no doubt many American Jews will not care enough to reassess
their positions on either Israel or Obama.

The one bit of encouraging news in all this is the persistence of support for Israel relative to Palestinians among rank and file Americans. Palestinians are supported by a mere five percent of Americans.

No doubt it is this disparity that is motivating leading Democratic politicians - most recently Senate Majority Leader Harry Reid and Democratic Senator Robert Menendez from New Jersey - to publicly distance themselves from the administration's Mideast policies.

If U.S. Jewish leaders and pro-Israel activists can educate just a fraction of the American Jewish community, and motivate them to stand with Israel in a significant way against administration pressure, this will likely motivate still more lawmakers and politicians from both parties to maintain support for Israel against the administration. Certainly it will help convince Israelis we haven't been abandoned by American Jewry. And that in itself
would be no mean achievement.

Caroline Glick is senior contributing editor at The Jerusalem Post. Her
Jewish Press-exclusive column appears the last week of each month. Her book
"The Shackled Warrior: Israel and the Global Jihad," is available at
Amazon.com.

4a) The 'Rape' of Israel
By Moshe Dann

Two years ago, Haaretz 's chief editor David Landau advised US Sec of State Condoleezza Rice to "rape Israel," to force it into making concessions. Rice tried to follow Landau's suggestion, but her efforts were not matched by her boss, President Bush. Now, that policy seems to be led by President Obama himself.


Assisted by Rahm Emanuel, Hillary Clinton, Dennis Ross, Dan Kurtzer, and others, Pres Obama seems intent on taking Israel down. In addition to the usual left wing Jewish organizations, the Reform Movement's PAC, Americans for Peace Now, a collection of marginal anti-Israel organizations have also lined up for the gang rape.


The analogy is appropriate: A stronger power forces his will upon a weaker victim regardless of what is fair, moral, and without any concern for the trauma he inflicts. The rapist (in this analogy) does what he thinks is good for himself. He wants what he wants.


When rape occurs in a family situation the rapist is often aided and abetted by a family member, often the wife/mother, either to please the rapist, or - in denial - to pretend that it wasn't happening, or carelessness bordering on neglect. That a family member is involved in the rape makes the act even more traumatic, since it involves the ultimate betrayal.


President Obama and his Jewish (and some Israeli) facilitators may believe that what they are doing is for Israel's own good. That might be acceptable if they explained how it works. Would a second Arab Palestinian state run by terrorists enhance Israel's security, promote peace with Israel and in the region, resolve the issues of Jerusalem, and millions of "Palestinian refugees"? Would the Palestinians and Arab states recognize Israel's right to exist as a Jewish state, and acknowledge facts of Jewish and world history? Would the proposed state include Jews with full rights, as Israel includes Arabs with full rights?


Nowhere in Obama's agenda are these questions raised or answered. Nowhere is there a hint of how his plan will be carried out, nor concern for what might happen if things don't go according to his visions. That's understandable, since his policy, like sexual aggression, is single minded.


His Jewish and Israeli enablers, like family members who participate in rapes, no doubt believe that what they are doing is in the name of Love. They might even argue that rape is better than murder, that forcing Israel to surrender and survive, albeit crippled and more vulnerable, is preferable to isolation, attack and invasion.


Raping Israel might be convenient for some, temporarily, even a perverted rescue from more dire consequences that would assuage any feelings of guilt. As long as the victim remains alive and available, however, the rapist will return. There's nothing like conquest to whet the appetite for more.


Finally, the most difficult aspect of rape is when there is compliance, when the victim, because of her fear and desperate need to please and be loved, allows the rape to occur. Many Israeli politicians and pundits believe that Israel's survival depends on American and international good will. They will do anything to achieve it, including denying national interests and integrity. Battered by accusations of causing humiliation, suffering and oppression, "the occupation," they surrender. Hungry for acceptance and temporary security, they acquiesce.


For those whose "wet dream" (as Landau described it to Rice) is the destruction of Jewish homes and communities "in order to advance 'the peace process,' " to reward Arab terrorists with a state of their own, the consummation of rape may satisfy them for a while; it's no consolation for those being violated, nor will it prevent the next savagery.


The author, a former asst professor of History, is a writer and journalist living in Jerusalem.



5) Senators claim $1 trillion health bill in reach
By ERICA WERNER and DAVID ESPO

Senators working to give President Barack Obama a comprehensive health care overhaul said Thursday they had figured out how to pare back the complex legislation to keep costs from crashing through a $1 trillion, 10-year ceiling.

The announcement from Finance Committee Chairman Max Baucus, D-Mont., and other lawmakers amounted to a small, parting gift to Obama on his top domestic priority as Congress prepares to leave town for its week long July 4 recess. It moved Congress a bit closer to a deal on legislation to lower costs and provide coverage to nearly 50 million Americans who lack it.

It also capped two weeks of tough going for health care negotiations on Capitol Hill as price tags as high as $1.6 trillion over 10 years sent senators back to the drawing board and forced deadlines to be repeatedly reset.

"We have options that would enable us to write a $1 trillion bill, fully paid for," Baucus said at a news conference.

Baucus declined to detail how the costs were being cut, but options included difficult sacrifices like potentially delaying an expansion of Medicaid, the federal-state program for the poor.

Others have said the changes made in recent days would lower the cost of government subsidies for those who cannot afford insurance, as well as pare back a planned 10-year series of rate increases for doctors serving Medicare patients.

Aides said the Congressional Budget Office had estimated that the elements under consideration would extend coverage to 97 percent of the population, excluding illegal immigrants.

But even Democrats acknowledged that Thursday's announcement fell fae short of a final deal on legislation to meet Obama's goals.

"There's not a final bill that's agreed to. What there is now is a clear path to having a bill that is paid for," said Sen. Kent Conrad, D-N.D., one of seven Republican and Democratic Finance Committee senators who've been working closely on the deal.

Baucus has dubbed the group "the coalition of the willing." All seven issued a brief, joint statement later Thursday claiming progress, even though some Republicans involved made no secret of their skepticism.

"We have not seen language (of legislation) in any way shape or form," said Sen. Orrin Hatch of Utah. He questioned how costs could be cut before bill language was written, calling it "gimmickry."

The Finance Committee had hoped to pass a bill by now, but given the setbacks of recent weeks Thursday's announcement was seen as progress. Of the five House and Senate panels writing health care bills, Finance is the only one with a real chance of producing a bipartisan bill, something Obama has repeatedly said he wants.

The committee will resume work when lawmakers return to Washington after July 4. On Thursday they discussed whether to give more power to MedPAC, a commission that makes recommendations to Congress on Medicare payment rates, Baucus said.

The House also will continue work on a partisan bill that embraces Democratic priorities, and similar legislation is taking shape in the Senate Health, Education, Labor and Pensions Committee. Health Committee lawmakers Thursday defeated an amendment offered by Sen. John McCain, R-Ariz., that would have allowed cheaper prescription drugs to be imported from Canada.

All the bills envision new requirements for all Americans to have health insurance, and prohibitions against insurance companies denying people care.

Still unsettled are the divisive questions of whether to create a new public plan to compete against private insurers, and what types of requirements employers should face to offer coverage to their workers.

Across from the Capitol on Thursday, hundreds of people, including actress Edie Falco, rallied for a health care overhaul.

Organizing for America, Obama's political operation within the Democratic National Committee, plans thousands of service events around the country Saturday aimed at building support for health care overhaul among a restive public wary of higher costs, lower quality and a giant price tag.

5a) Health Care Faces the 'R' Word
By Michael Kinsley



Even though more and more Americans have no health insurance at all, Americans consider health care to be a right. Not just that: We consider the best possible health care to be a right. Few would find it acceptable for a poor person to die of a medically curable disease for lack of money. Even fewer would find it acceptable that they themselves should die because the system won't spend the money to cure them. This is all in theory, of course. In practice, people die all the time because some effective treatment is too expensive. But whenever an issue gets drawn into the political system and becomes explicit, it becomes harder. That is what health-care reform will do to the question of rationing.

The Obama administration believes that health care can be made cheaper without any reduction in quality. It has evidence to back this up. According to the famous Dartmouth studies, health care costs two or three times as much per person in some places in America as it does in others, with no measurable difference in results. Atul Gawande's deservedly admired recent essay in the New Yorker makes a similar point. So in theory it's easy: Just figure out how the cheap places do it and apply this knowledge to bring down the cost in the pricier places.

But that doesn't mean rationing will be easy to avoid. Statistics on life expectancy or infant mortality are averages. The easiest way to raise your averages -- maybe even the best way, if we're being honest -- is to concentrate on the general level of care and not to squander a lot on long-odds cases. But if the long-odds case is you or a family member, you may well feel differently.

In the debate about how to reform health care, "how" means two different things. One is the industry structure: Should we simply nationalize the whole system or set up a government alternative to operate alongside the private one? Or are there novel market-based alternatives that ought to be tried? Gawande thinks the problem is a culture of medicine that has become too greedy. Others believe that human greed is a given and that either the government or the market will have to do a better job of controlling it. The other "how" is how the actual course of treatment for patients will change. Here there is much less to debate. Cheaper treatment means less treatment: fewer tests, fewer surgeries, fewer drugs.

Less care doesn't necessarily mean worse care. The administration is investing great hopes (and $1.1 billion of stimulus money) in "comparative effectiveness research." Because we don't collect and compare in any systematic way the vast piles of data we have about individual patients and their treatment, we know astonishingly little about which treatments work and which are a waste of money. The administration is touting the figure of 30 percent of all health-care costs as spending that may accomplish nothing.

I suspect that what a billion-plus dollars' worth of research will find is that perhaps 30 percent of what we spend on health care is almost entirely worthless, or just barely better than a much cheaper alternative. Or it might be better and no one knows for sure. Denying someone these treatments or tests is rationing.

Similarly, when fear of malpractice lawsuits leads doctors to practice "defensive medicine" -- a legitimate complaint about current arrangements -- it doesn't mean that they order worthless tests. It means they order tests with only a very long-shot chance of finding something wrong.

Here is a handy-dandy way to determine whether the failure to order some exam or treatment constitutes rationing: If the patient were the president, would he get it? If he'd get it and you wouldn't, it's rationing.

It may seem absurd to worry about whether wealthy or well-insured people get every last test and exotic or speculative treatment when millions of Americans have no health insurance and millions more have gaping holes in their coverage. But the well-insured happen to include virtually all the people making the key decisions about health-care reform -- members of Congress and their staffs, the White House staff, Washington journalists, and so on. These people's fears that they would lose the right to "choose my own doctor" (code for getting treatment with all the bells and whistles) helped kill Hillary Clinton's attempt to reform health care in the early 1990s. Fear of rationing could kill Obamacare for the same reason.

Whether or not this makes sense is a question of taste, not policy.

David Leonhardt of the New York Times recently noted that spending so much on health care squeezes out spending on other things that we might prefer, and that is a form of rationing. On the other hand, the blogger Mickey Kaus argues that it makes perfect sense for a society growing richer (as ours soon will be again, we hope) to spend a growing share of that wealth on improving our health and longevity.

That is what we do as individuals. And what better to spend your money on?

5b)The Dangers of Fannie Mae Health Care: A public plan would have certain advantages. That's precisely the problem
By JOHN E. CALFEE


President Obama and most congressional Democrats say they want to preserve private health insurance. They also want to add a "public plan" to compete with private insurance plans. Their basic argument is that a public plan would offer needed competition, save money through low administrative costs and zero profits, realize greater economies of scale, and be a superior negotiator of the prices of medical services and technology.


The first three arguments are bogus. The fourth argument is only half-bogus -- but the half that isn't reveals a great danger: If a public plan is inserted into private insurance markets, the American health-care system could rapidly evolve into a single-payer system, which would have devastating effects on R&D for new medical technology.

The first argument, that we need a public plan to spur competition, just isn't plausible. Hundreds of health insurance plans already exist, and employer benefit managers can choose among numerous alternatives. There is no lack of firms willing to compete to provide health insurance.

As to the second argument, what is to be saved by avoiding profits? Nonprofit health insurance firms are common, including many of the Blue Cross-Blue Shield plans. Nonprofit status has not proved to be a reliable source of efficiency and cost-saving. The addition of new nonprofit cooperatives and the like -- as a bipartisan group of senators has proposed -- would make little difference, unless the new plans are given the power to set prices and take on extra risk supported by government subsidies.

Would a public plan have lower administrative costs? Well, how often are public enterprises run more efficiently than private ones? Why did practically all economically advanced nations dismantle their public airlines, phone companies, and so on, invariably obtaining lower administrative costs and consumer prices?

As Stanford University health economist Victor Fuchs has pointed out, what "insurance" firms actually sell to large employers -- which account for the single largest segment of the entire health-care market -- is usually administrative services, not actual insurance. (Large companies are not insured; they pay benefits directly.) There is no reason to expect a Medicare-like public plan to match the administrative efficiency of Aetna, Blue Cross-Blue Shield, Cigna, UnitedHealth Group, and WellPoint. Medicare doesn't even try. It outsources most administrative services to the private sector.

Turning to public plans like Medicare and Medicaid for more efficient administration is a fool's errand.

What about economies of scale? Aetna currently serves about 18 million subscribers, UnitedHealth Care serves between 25 million and 30 million, and WellPoint more than 35 million. That is more than is served by the health-care monopoly of Canada (population 33.6 million), and more than the entire health-care systems of most European nations. Once a plan reaches a few million subscribers, there may not be a lot of economies of scale left that can enable public plans to provide lower prices.

Finally, there is the crucial task of negotiating prices for doctors, hospitals, clinics, drugs, devices and thousands of other items essential to modern health care. Here, there are really two arguments for a public plan. The first is about bargaining skill and the firm size, basic ingredients in any negotiating environment.

There is no reason to think the administrators of a public plan will possess skills superior to those honed by private plan personnel during years of negotiations under the pressure of competition. Nor is there any reason to think that mere size would help.

True enough, relatively small European nations routinely obtain better drug prices than are achieved by mammoth American pharmacy benefit managers such as Express Scripts (50 million patients) and Medco (60 million patients), each of whose numbers exceed the entire citizenry of all but the largest European nations. Even sparsely populated New Zealand (population four million) gets better prices than the giant drug-price negotiators in the American private market.

Their success is due to what economists call "monopsony power." Monopsony occurs when a single buyer negotiates prices with several competing sellers (as opposed to monopoly, where there are many buyers but one seller).

Thus, if you want to sell your branded drug in New Zealand, your prices are negotiated with PharMac, a branch of the government. Much the same is true when selling to Canada, Germany, the Netherlands, and essentially the entire developed world save the United States. The negotiating power of these government entities results from monopsony, not superior skill.

For example, the various sellers of cholesterol drugs (Lipitor, Crestor, and so on) have to compete with one another while they all face a single government negotiator. If one seller balks at government prices, it leaves competitors to pick up more sales. The same is true for most other drug classes and most medical devices. This uneven battle ensures that negotiated prices will be well below those in a competitive market.

But here is where the huge risks of creating a "public plan" to compete with private insurance firms come into focus. Foremost among these risks are the effects of monopsony power in the purchase of medical technology.

The U.S. is unique because it alone is the source of half of world-wide profits that provide the payoff for the complex, lengthy, and expensive process of developing new treatments. When other nations construct their health-care systems, they ignore the impact of their pricing policies on R&D incentives. As the dominant R&D funding wellhead, we do not have that option.

Competitive markets have generated the prices and the profits necessary to induce a steady flow of medical innovation in this country. A public plan option would tend to dismantle that system. The people in charge will not know how to set reimbursement levels to motivate reasonable R&D efforts, and there is no reason to expect them to try. In public plans, the tried-and-true method is to push the prices of suppliers down until something gives -- too few doctors willing to take on Medicare patients, for example -- and then to ease up. That is a destructive approach to medical technology R&D.

Who knows what drugs will not be developed if reimbursement levels for a new multiple-sclerosis treatment are too measly? In virtually every advanced economy but our own, pricing authorities simply make sure prices are high enough so that existing drugs continue to be made available. We can expect a public plan here to do the same. The inevitable result is to drastically under-incentivize R&D.

This problem would not matter if a public plan remained small -- but it would likely grow into a monster. Monopsony negotiating power will generate lower prices, so many consumers will switch to a public plan. Employers eager to offload health-care costs will also dump unwilling employees into the public plan. That is the basis for the Lewin Group's much-cited prediction that a public plan would come to dominate any market in which it is allowed to compete.

Bargaining power, however, is far from the only potential source of below-market prices for public plans. In the home mortgage market, the public plans -- known as Fannie Mae and Freddie Mac -- were for years viewed by investors as less risky because they would be bailed out by the federal government if they took on too much risk. That translated into lower prices (the interest rates paid by borrowers), which eventually translated into extraordinary and unseemly growth, culminating in bankruptcy and a federal bailout.

The lesson for health insurance is clear. All insurance plans -- especially in health-care markets -- have to take on risk. Prudent planning, including the maintenance of reasonable financial reserves, is necessary. That increases costs. It would be all too easy for a public plan to gain a competitive advantage by taking on extra risk while keeping prices low because everyone would expect the federal government to take care of financial surprises down the road.

In sum, a public plan would possess formidable and perhaps overwhelming competitive advantages -- generated not by efficiency but by the artificial advantages of "public" status. This would have two disastrous consequences. The first will be to cause most Americans now covered by private insurance to move to public insurance -- one step away from single-payer health care. The second will be to undermine incentives to develop more of the immensely valuable medical technology that is central to all of health care.

Mr. Calfee is a resident scholar at the American Enterprise Institute.

6) AIG's Deal: Fed Gets Stakes, Debt Is Cut

Tuesday's Annual Meeting for the Insurer Will Be the First One Under Uncle Sam's Thumb.

American International Group Inc.'s annual meeting on Tuesday will be the first with the U.S. government as the controlling shareholder, but almost certainly not the last.

Many financial firms that took bailout money paid back billions this month. Yet even with the deal announced Thursday to give the Federal Reserve Bank of New York stakes valued at $25billion in two of AIG's foreign life-insurance units -- a move that will reduce AIG's tab -- it remains unclear when or whether taxpayers will be made whole.

Washington is exerting broad influence over AIG as it tries to lay the groundwork ...


6a) When did the lowbrows take over the culture?
By James Lewis

I've been trying to grasp for a truth that is so obvious that all of us know it. But it's not a polite truth, so we don't talk about it. Yet I think it's important to say it out loud, because it is a truth that haunts our national discourse.


As a nation we are under the thumb of idiots. Not just indoctrinated, or wrong-thinking, or power-hungry, or manipulative, or even malevolent people. No, I mean real lowbrows, people who constantly fall for really stupid ideas. Neanderthals. (Look at the Governor of California just running the state budget into the ground. See what I mean? That's not just incompetence. It takes special stupidity, almost a deliberate, willful absence of real thinking.)


The Federal EPA is about to officially declare carbon dioxide to be a pollutant. That's not just false and unscientific; it's not just an excuse for taxing everything in sight, including breathing. It's not merely wrong. It's idiotic. It marks a low point in our national conversation. Scientists or engineers with a grain of sense shouldn't be taking the EPA seriously for a second. Forget the "climate experts," with their grossly inadequate computer models. Normally intelligent people should boggle at the EPA. They are bizarre. Only the truly ignorant could fall for this level of ignorance. Or those who just can't think.


Or look at Obama's unbelievable spending spree. No sane and sensible taxpayer could possibly believe that spending trillions and trillions of dollars on blue-sky fantasies makes any sense at all; the only reason Americans aren't in open rebellion yet is that half of them can't believe it's happening, and the other half are idiots. We haven't seen the effect (yet) on our pocketbooks. There's food in the stores still, and housing has gotten cheaper. But let Obama's budget affect our wallets directly and just watch the voters explode with rage.


The Democrats in Congress are trying desperately to put the brakes on Obama's egomaniacal ambitions because they can see themselves going over the edge in 2010. In a self-respecting, intelligent culture, the Obama budget would be dead on arrival. It's an insult to our national intelligence. (His foreign policy is more of the same.)


Or look at the global warming farce, still hotly pursued by the political classes in Europe and this country, although the Australians seem to be coming to their senses. China now has more millionaires than the UK, because they use all their resources, like coal, to fire their industrial plants. They will never sacrifice a single luxury car to the cap and trade fraud. Neither will India. China and India have been under the thumb of egomaniacal socialists (in the case of India) and communists (in the case of China). They've been there, done that, seen the suffering.


No wonder those Chinese college students fell all over themselves with laughter when Timothy Geithner assured them that Obama would never spend the United States into debt. What an idiot! They laughed because Geithner's stupidity or mendacity was too obvious for words.


That's how we should all react to the miserable frauds who are now in national office. You have to dull your senses with drugs or endless propaganda to fall for it. I've sometimes wondered how many people must have killed off their critical thinking with alcohol and drugs. I know a walking few drug casualties myself, people who just burned out their brains. I'm sure they voted for Obama.


Or maybe there's such a thing as learned stupidity. How else can so many people be so idiotic? Our national IQ has dropped to about 75: Several standard deviations below normal.


Well, we have now voted in a President for the lowbrows. Yes, Obama himself is smart enough; even smart enough to say a few years ago that he didn't feel ready for the presidency. Well, now we can see why he said that. But legions of idiots voted for a man who was plainly unqualified, even by his own estimation, and surrounded by a bunch of malignant sociopaths like Wright and Ayers and all the rest. How could he possibly win? Well, Obama cynically appealed to the idiots -- the young, the stupid, the naive, the silly, the rock idol worshippers, and probably the drug-addled masses, all the lowbrows in the land.


That includes the idiot savants of academia. Academics have a very narrow band of intelligence, something that satirists since Aristophanes have noticed and poked fun at. The first philosopher in Western history was Thales of Elea; Thales featured in Greek folklore as a man who walked around at night gazing at the stars only to fall into a ditch. That's probably a folksy giggle at the absent-minded professor who is constantly bumping into walls. But there's a big element of truth in it. Academics can be incredibly ignorant and dumb outside of their small areas of expertise. Professors and media scribblers generally lack human smarts. They are sure suckers for all the con artists of the day.


Obama is a smooth-talking hustler who has specialized in charming academic liberals, like a smart graduate student who needs to impress his teachers with every word. They just dote on him, like a proud parent smiling on a favorite child. He's their dream, a black man who sounds so smart.


In his press conferences he hypnotizes all the ink-stained wretches of the media. It's a sight to behold. The man swats a fly and the suck-ups of the media go ga-ga with applause, and go back and write articles about it. That's not just a reflection on their (lack of) character and judgment. It's not just their childish immaturity. It's a reflection on their brains, or rather, on all that empty space between their ears. Our media stars are just not very bright. They're idiots. That single fact explains a lot. (And yes, they are also corrupt, easily seduced, haunted by deadlines, decadent in their values, and very prone to mob thinking. But if they had any brains it might be harder to manipulate them like this. The White House just pulls their strings and they dance.)


Obama's 22 White House czars. That's really stupid. As well as a violation of the Constitution. But it's a Chinese laugh line. It's so obviously wrong and power-mad that it's not worth debating.


Legalizing drugs. That's really stupid.


Obama's power-grab over the medical sector of the economy? It's profoundly stupid. We can insure all the uninsured people in the country for a tiny fraction of all that money. We just need to fix the tire on our national car, and this guy tries to sell us a brand-new O-mobile, it can practically fly off the lot, all on credit, long-term payments, no money down. It's gonna be free! So what if you have to mortgage your wife and children? Even if we already have two national lemons in our garage, Medicare and Medicaid, which nobody likes. Now Obee is trying to sell us on a really, really expensive dream mobile that will fix our problems forever, plus it'll be cheaper than what we have now!


Can you believe it?


That sales pitch only works for idiots.


The rise to power and fame of the real lowbrows explains a lot. It even points to an answer of sorts. Because we've all been intimidated by the Cult of Nice not to contradict anybody who comes out with a really stupid, destructive idea. We can no longer call a really stupid idea what it is. I know that I censor myself all the time. We have been taught to keep our mouths shut when a word in time might make a real difference. We have allowed the national conversation to be dumbed down.


Here's my resolution for July Fourth: From now on I'm going to call idiocy idiotic. Not nastily, but as clearly as I can. It is high time for normal, intelligent common sense to become acceptable again. I'm happy to have a respectful argument with anyone who disagrees with me. But I'm going to start saying the magic words:


That's really dumb! That's really ignorant! You haven't thought about that much, have you? Have you ever considered another side of that batty idea?


I promise to be nice.


But honest.


Pass the word.


If we all start doing it we can change the world.