Socialism is Killing Social Security!

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

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

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

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

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

A few reasons why this is so:

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

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

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

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

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

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

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

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


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

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

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


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

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


Dick

1) When Reality Sets In
By Ruben Navarrette

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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




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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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




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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

They were also critical of the existing process.

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

Staff writer Neil Irwin contributed to this report.

5) A Small Man
By John Podhoretz

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

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

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

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

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

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

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

Guilt and Stupidity - A formidable Combination!

Sent to me by my Louisville daughter who took us to visit the West End School I wrote about several memos ago. In many cases the only solution is to get children away from their dysfunctional 'home' environment. (See 1 below.)

Desparate people can be driven to desparate action.

Norman Podhoretz is someone whose views I have admired for years and generally agree with so I cannot wait for his 12th book to be published - "Why Are Jews Liberal?"
My own view is guilt, stupidity, FDR and their connection to Europe. (See 2 below.)

More advice for Obama regarding what Netanyahu should ask him. Cal Thomas, understands clearly what the problem is - Iran, and its surrogates - Hezballah and Hamas - are bent on Israel's destruction and now possibly have an ally in Obama. (See 3 below.)

Walker is correct - it does not take a rocket scientist to sell sensible Conservatism but it does take a willingness on the part of Conservatives not to intrude their divisive narrow views on matters irrelevant to broader national concerns that are critical, ie. deficits, terrorism, a government out of control both operationally and costwise and growing restrictions, incursions and disruptions as government strangles Capitalism etc..

Abortion is the most glaring "Achilles Heel" issue. I am a Conservative, but I also believe a woman has a right to do with her body what she so chooses. I am opposed to the federal government paying for abortions just as I am were the government to pay for tattoos. I also oppose affirmative action and welfare (except in the rarest of occasions) but am more than agreeable to paying for vocational training for those voluntarily willing to improve their job skills and so it goes (See 4 below.)

Was Panetta's visit to learn of Israel's legitimate concerns or to issue a warning to Netanyahu to cool it? Probably both!

Obama pulled support for torture photo releases yesterday. Maybe Obama is beginning to understand the difference between campaigning for and being president. (See 4a below.)

For someone so committed to naive views it will take a lot of persuading but Obama is intelligent enough to understand should he choose to eat some crow. Certainly Obama has established a visible record of reversing himself because few basic principles seem to form his character.

I also have said repeatedly Israel and the Saudis are more closely in agreement regarding Iran than either are with Obama's misguided thinking.

One thing for sure, Obama is willing to play hard ball, be ruthless to get what he wants and does not like being crossed. Even a little thing like The Constitution will not deter him - ask Chrysler bondholders etc. (See 5, 5a, 5b and 5c below.)

It is understandable why Jordan's King presses for a two state solution, even if unworkable:


a) Most of Jordan is populated by Palestinians.

b) Jordan is threatened by any outbreak of war or instability in the West Bank. (See 6 below.)

A Kuwait Professor expresses Arab fear of U.S. betrayal. (See 7 below.)

Stop and think, government is expanding employment while the rest of the nation's work force is shrinking and you cannot export government jobs - they remain here. Therefore, Democrats keep buying votes with your tax dollars. (See 8 and 8a below.)


Like I have repeatedly written, get government involved in health care drug development and it will solve Social Security underfunding. Why? Because we will die sooner as life expectancy declines. (See 9 below.)

Murtha is correct - we need more airports with flights exclusively to Disney East. Earmarks are political equivalents of waterboarding.

The EU's fine against Intel is the economic equivalent of waterboarding. Price discounts, which lower consumer costs, are a dangerous sales strategy. It is the same argument unions make against WalMart - lowering consumer costs is an unhealthy endeavor and must be stopped at all costs! (See 10 and 10a below.)
Dick


1) What Public Boarding Schools Teach Us
By Steven Gray

Soon after starting his job as superintendent of the Memphis, Tenn., public schools in 2008, Kriner Cash ordered an assessment of his new district's 104,000 students. The findings were grim: nearly a third had been held back at least one academic year. The high school graduation rate had fallen to 67%. One in five dropped out. But what most concerned him was that the number of students considered "highly mobile," meaning they had moved at least once during the school year, had ballooned to 34,000, partly because of the home-foreclosure crisis. At least 1,500 students were homeless--probably more. "I had a whole array of students who were angry, depressed, not getting the rest they needed," Cash says. It led him to ponder an unusual proposition: What if the best way to help kids in impoverished urban neighborhoods is to get them out?

Cash is now calling for Memphis to create a residential school for 300 to 400 kids whose parents are in financial distress, with a live-in faculty rivaling those of élite New England prep schools. His proposal is at the forefront of a broader national trend: from New Jersey to Wisconsin to California, school districts and private investors are developing similar projects. Supporters hope that U.S. Education Secretary Arne Duncan, who pushed for public boarding schools as CEO of Chicago's school system, will give the programs even greater traction.

Public boarding schools are hardly a new concept. Institutions in Indiana and Pennsylvania took in the children of dead Civil War veterans, and Louisiana and Illinois offered residential programs for gifted students in the 1980s. But publicly financing boarding schools for inner-city kids is a very different proposition. It was revolutionary in the late 1990s, when two consultants quit their jobs and began raising money to open the SEED School, a charter school in gritty Southeast Washington.

If Cash's dream becomes a reality, it will probably look a lot like SEED, which stands for Schools for Educational Evolution and Development. Its 320 students--seventh- to 12th-graders--live on campus five days a week. They are expected to adhere to a strict dress code and keep their room tidy. There are computers in the dorms' common areas, and each student in grades 10 and above is given a desktop computer. At 11:30 every night, it's lights out. "Principals often say, 'If I could just extend my day a little longer, I could do so much,'" says SEED's head of school, Charles Adams. "Here, there's the gift of time. So there's no excuse."

In his plan for Memphis, Cash wants even more time. Perhaps the most provocative aspect of his proposal is to focus on students in grades 3 through 5. Homelessness is growing sharply among kids at that critical age, when much of their educational foundation is set, Cash says. His aim: to thwart illiteracy and clear other learning roadblocks early, so the problem "won't migrate into middle and high school." Students will remain on campus year-round. "I don't see that there's anything better in the summertime in their neighborhoods," he notes. The school would cost up to $50,000 a day to operate--three times the cost of a traditional day school with more than twice as many students. "It sounds very exciting, but the devil is in the details," says Ellen Bassuk, president of the National Center on Family Homelessness in Newton, Mass. "What's it like to separate a third- or fifth-grader from their parents?"

It may help to consider the experience of SEED student Mansur Muhammad, 17. When he arrived seven years ago, the first few weeks were tough. He'd often call his mother and write his dad. Friendships he had in his old neighborhood frayed. But Muhammad, now an honor-roll senior who hopes to become his family's first college graduate, hasn't looked back. He maintains a 3.2 GPA and reshelves books in the school's library for $160 every couple of days, when he's not in his room listening to rap or classical music and writing poetry. Inspired by a teacher, Muhammad is working on a book. "It was a long road for me to get here," he says, "and I have a long way to go.


2)How Obama's America Might Threaten Israel: Determined fecklessness on Iran could lead to nuclear war.
By NORMAN PODHORETZ

Is there a threat to Israel from the United States under Barack Obama? The question itself seems perverse. For in spite of the hostility to Israel in certain American quarters, this country has more often than not been the beleaguered Jewish state's only friend in the face of threats coming from others. Nor has the young Obama administration been any less fervent than its last two predecessors in declaring an undying commitment to the security and survival of Israel.

.
Nevertheless, during the 2008 presidential campaign, friends of Israel (a category that, speculations to the contrary notwithstanding, still includes a large majority of the American Jewish community) had ample reason for anxiety over Mr. Obama. The main reason was his attitude toward Iran. After all, Iran under its current president, Mahmoud Ahmadinejad, was vowing almost on a daily basis to "wipe Israel off the map" and was drawing closer and closer to acquiring the nuclear weapons and the ballistic missiles that would give the ruling mullocracy the means to do so. And yet Mr. Obama seemed to think that the best way to head off the very real possibility this posed of another holocaust was by entering into talks with Iran "without preconditions." Otherwise, except for campaign promises, his record was bereft of any definitive indication of his views on the war the Arab/Muslim world has been waging against the Jewish state from the day of its founding more than 60 years ago.

Still—lest we forget—Mr. Obama did have a history of involvement with associates whose enmity toward Israel was unmistakable. There was, most notoriously, his longtime pastor, the Rev. Jeremiah Wright. In addition to honoring the blatantly anti-Semitic Louis Farrakhan, Mr. Wright was on record as believing that Israel had joined with South Africa in developing an "ethnic bomb" designed to kill blacks and Arabs but not whites; he had accused Israel of committing "genocide" against the Palestinians; and he had participated in a campaign to get American companies to "divest" from Israel. None of this, however, nor all of it together, had elicited so much as a peep of protest from Mr. Obama, never mind provoking him into leaving Mr. Wright's congregation. He remained a member for 20 years, during which time Mr. Wright officiated at his marriage and baptized his children.

Then there was Rashid Khalidi, holder of a professorship at Columbia named after his idol, the late Edward Said. As befitted a reverential disciple of the leading propagandist for Palestinian terrorism, and himself a defender of suicide bombing, Mr. Khalidi regularly denounced Israel as a "racist" state in the process of creating an "apartheid system." Nevertheless, Mr. Obama had befriended him, had publicly acknowledged being influenced by him, and, as a member of the board of a charitable foundation, had also helped to support him financially. And there was also one of Mr. Obama's chief advisers on national security and a co-chairman of his campaign, Gen. Merrill McPeak, who subscribed to the canard that American policy in the Middle East was dictated by Jews in the interests not of the United States but of Israel. Others said to be advising Mr. Obama included a number who were no more notable than Gen. McPeak for their friendliness toward Israel: Zbigniew Brzezinski, Robert Malley, Susan Rice and Samantha Power.

True, as the campaign proceeded, Mr. Obama either distanced himself from or repudiated the ideas of such associates. Yet he got around to doing so only when the political exigencies of his candidacy left him no prudential alternative.

Not surprisingly, a fair number of Jews who had never voted for a Republican in their lives were disturbed enough to tell pollsters that they had serious doubts about supporting Mr. Obama. Faced with this horrific prospect, Mr. Obama's Jewish backers mounted a vigorous effort of reassurance. No fewer than 300 rabbis issued a statement declaring that his "deep and abiding spiritual faith" derived from "the teachings of the Hebrew Prophets." Several well-known champions of Israel also wrote articles explaining on rather convoluted grounds why they were backing Mr. Obama. There was, for example, Alan Dershowitz of the Harvard Law School: "The election of Barack Obama—a liberal supporter of Israel—will enhance Israel's position among wavering liberals." And Martin Peretz of The New Republic: "Israel's conflict with the Arabs . . . is mostly about history, and Obama is a student of history." And Martin Indyk of the Brookings Institution: "I believe Obama passes the kishke [gut] test."

The small community of politically conservative Jews did what it could to counter this campaign, but to no avail. In the event, Mr. Obama received 78% of the Jewish vote. This was a staggering 35 points higher than the pro-Obama white vote in general (43%), and it was even 11 points higher than the Hispanic vote (67%). Only with blacks, who gave him 95% of their vote, did Mr. Obama do better than with Jews. The results were just as dramatic when broken down by religion as by race and ethnicity: Protestants gave 45% of their vote to Obama (33 points less than Jews), and Catholics gave him 54% (24 points less than Jews).

But if the forecasts of a Jewish defection from Mr. Obama were all wrong, the prediction of his Jewish opponents that he would be less friendly toward Israel than George W. Bush has turned out to be more accurate than any "kishke test." Mr. Bush's friendliness manifested itself in various ways. One of the most important was his backing for the measures Israel had been taking to defend itself against suicide bombing—the building of a wall and the institution of checkpoints that would make it harder for suicide bombers to get through from the West Bank and into Israel proper. These measures were denounced almost everywhere as oppressive in themselves and as a species of apartheid, while the accompanying assassinations of the leaders who recruited, trained and supplied the suicide bombers were routinely condemned as acts of murder. But Mr. Bush—that is, the Bush who emerged after 9/11—would have none of this. So far as he was concerned, suicide bombing was a form of terrorism and therefore evil by definition. Israel had an absolute right to defend itself against this great evil, and in fighting it, the Israelis were struggling against the same enemy that had declared war on us on 9/11.

A similar logic guided Mr. Bush's view of the Israeli incursion into Lebanon in 2006 and of its attack on Gaza in 2008. Since, contrary to the confident assurances of their opponents, the wall, the checkpoints and the targeted assassinations had all but eliminated suicide bombing, the terrorists were now resorting to a different tactic. From its redoubt in Lebanon, Hezbollah rained rockets into the north of Israel, and from its base in Gaza, Hamas fired them into the south. In each of these cases, when the Israelis finally responded, they were furiously accused by most of the world of using "disproportionate" force that allegedly resulted in the wholesale "slaughter" of innocent civilians. But Mr. Bush would have none of these egregious defamations either. Both in 2006 and 2008, he again affirmed Israel's right to defend itself against terrorist assault, and he worked to fend off efforts by the U.N. to stop the Israelis before they could finish the job they had set out to do.

To be sure, Barack Obama (while still president-elect) said about the then impending Israeli incursion into Gaza, that "if somebody was sending rockets into my house where my two daughters sleep at night, I would do everything in my power to stop that and I would expect Israelis to do the same thing."

This sounded very much like Mr. Bush. But whereas an altogether new conception of how to make peace between Israel and the Palestinians undergirded Mr. Bush's support for the tactics Israel had been using to defend itself against terrorist attack, there was nothing in Mr. Obama's record or in his past statements or in his history to suggest that he shared, or even was aware of, this conception.

George W. Bush was the first American president to come out openly in favor of a Palestinian state. But he also decided to attach a codicil that was even more novel. "Today," he declared on June 24, 2002:

Palestinian authorities are encouraging, not opposing, terrorism. This is unacceptable. And the United States will not support the establishment of a Palestinian state until its leaders engage in a sustained fight against the terrorists and dismantle their infrastructure.
To this he added the requirement that they elect "new leaders, not compromised by terror," which amounted to an implicit demand that Yasser Arafat be replaced.

Of course, Mr. Bush also challenged Israel "to take concrete steps to support the emergence of a viable, credible Palestinian state." Yet he most emphatically did not follow the usual practice of blaming Israel for the persistence of the war against it. Instead, in an entirely unprecedented move, he placed the onus on the Palestinian leaders and the Arab states backing them up. By saying up front that "there is simply no way to achieve . . . peace until all parties fight terror," he was blaming the absence of peace on the Arab states and the "Palestinian authorities" (who were "encouraging, not opposing, terrorism"), and he was exonerating the Israelis (who were being "victimized by terrorists," not supporting them).

Nor was this all. Two years later, in an addendum to his codicil, Mr. Bush said that "as part of a final peace settlement, Israel must have secure and recognized borders," and that these must include "already existing major Israeli population centers." To put it plainly, the United States rejected the almost universally accepted idea that a precondition for the establishment of a Palestinian state was the forcible removal of every last Jew from the West Bank. In all other contexts, this is known as ethnic cleansing and regarded as a great crime. But in this context alone, and by a process of reasoning that has always escaped me, it has been magically transmuted into the exercise of a sacred human right. Not, however, to Mr. Bush.

Now, on a number of issues—most notably Iraq—Mr. Obama as president has surprised many people by in effect signing on to Mr. Bush's policies (while claiming to be reversing them). Yet even though he will certainly follow Mr. Bush in pushing for the establishment of a Palestinian state, it would be nothing less than astounding if he were also to accept the conditions prescribed by the Bush codicil and its addendum. For neither Mr. Obama himself nor those of his appointees who will be involved in the "peace process"—his secretary of state, Hillary Clinton; his special envoy to the Middle East, George Mitchell; his national security adviser, Gen. James Jones; and his ambassador to the U.N., Susan Rice, although she made the right noises at her confirmation hearing—have ever so much as suggested that it is the Palestinians and not the Israelis who are blocking the way to the holy grail of a two-state solution. On the contrary, Mr. Obama and his team are all great worshipers at the shrine of "evenhandedness," which has long served as a deceptive euphemism for pressuring Israel to make unilateral concessions to Palestinian demands.

No wonder, then, that the Obama administration is already reverting to the old pre-Bush assumptions that have repeatedly been discredited in practice: that Israeli "intransigence" is the main obstacle to ending the conflict with the Palestinians, that "restarting" the "peace process" therefore requires putting the onus back on Israel, and that this in turn necessitates forcing Israel back to the 1967 borders. In other words, Jerusalem must be redivided and the major centers of Jewish population in the West Bank that Bush had promised would remain part of Israel must also be evacuated and the West Bank as a whole be made Judenrein.

Indeed, during Hillary Clinton's first trip as secretary of state to Israel, she went evenhandedly out of her way to castigate the Israelis over the issue of Arab housing in Jerusalem while making a great show of the $900 million the U.S. has pledged to Gaza.

It is too early to tell whether the return to this approach will go so far as to substantiate the fear expressed by the former U.N. ambassador John R. Bolton, who foresees "pressure on Israel to acknowledge the legitimacy of [Hamas and Hezbollah], and to negotiate with them as equals (albeit perhaps under some artful camouflage)." But it is not too early to tell that nothing will come of a reversion to the pre-Bush assumptions. Nothing will come of it with the Israelis because they—even most of the doves among them—have learned that withdrawing from previously occupied territories means the creation of bases from which terrorists will rain rockets on Israeli towns. Thus, when in 2000 they withdrew from the security zone they had established in southern Lebanon, Hezbollah moved in, and then their withdrawal from Gaza in 2005 resulted in a takeover by Hamas—eventuating in both cases not in peace or even improved prospects for peace but in war and more war. Furthermore, the withdrawal from Gaza, entailing as it did the dragging of some 8,000 Jews out of their homes, was so painful a national trauma that doing the same to more than 30 times that many Jews living in the West Bank has become unthinkable.

Nor will anything come of the old approach with the Palestinians. The writ, such as it is, of Mahmoud Abbas as president of the Palestinian Authority extends only to the West Bank, not to Gaza, so that even if he were to reach an agreement with Israel, he lacks the power to deliver on it.

But a deeper reason may be at work here as well. When people quote Abba Eban's famous quip that the Palestinians never miss an opportunity to miss an opportunity, the opportunity they have in mind is the achievement of statehood. And it is true that on at least three occasions when they could have had peace and a state of their own for the asking—in 1947, under the U.N. partition plan; in 2000, under the extremely generous terms proposed jointly by Israel under Ehud Barak and the United States under Bill Clinton; and in 2005, after the Israeli withdrawal from Gaza—the Palestinians rejected statehood and chose war instead.

May it not be, then, that they failed to seize these "opportunities" because they have never really wanted a state of their own?

Giora Eiland, a retired general and the former head of Israel's National Security Council, argues that this is indeed the case. He writes:

The Palestinian ethos is based on values such as justice, victimization, revenge, and above all, the "right of return." . . . It's true that the Palestinians want to do away with the occupation, but it's wrong to assume that this translates into a desire for an independent state. They would prefer the solution of "no state at all"—that is, the State of Israel will cease to exist and the area between the Mediterranean Sea and the Jordan River will be divided among Jordan, Syria, and Egypt.
Adding to the plausibility of this theory is the most recent polling data showing that a large majority of Palestinians would reject the two-state solution even after "the settlement of all issues in dispute," and would be unwilling to accept a state of their own even with its capital in East Jerusalem and an unlimited "right of return."

But whether or not Mr. Eiland is right—and I for one think that he is, at least about the "no-state" solution—the futility under current conditions of negotiations between Israel and the Palestinians is so obvious that even devout American "peace processers" like Aaron David Miller and Martin Indyk acknowledge it. Hence (along with certain high-placed Israelis) they now advocate shifting to the "Syrian track." But nothing will come of this either. Even under the delusion that, in exchange for the Golan Heights, Syria would be ready to give up the dream of wiping Israel off the map that it shares with its closest ally Iran, it is hard to see how the Israelis would be willing to do unto the 20,000 Jews living there what they did to the 8,000 who lived in Gaza.

When I say that nothing will come of renewed American pressure on Israel to accept the demands that are the precondition of a deal with the Palestinians or the Syrians, I mean that nothing will come of it on the ground. It is, however, likely to result in the same souring of relations that developed in the 1990s when George H.W. Bush was in the White House and Yitzhak Shamir was prime minister of Israel, and that then carried over to their successors, Bill Clinton and Benjamin Netanyahu. Unpleasant as this would be, it does not rise to the level of a threat.

But what surely does rise to the level of a threat is American policy toward Iran. In making the ridiculous boast during his presidential campaign that he could talk Iran into giving up its quest for nuclear weapons (and the missiles to deliver them), Mr. Obama was careful to add that the military option remained available in case all else failed. But everyone, and especially the Iranians and the Israelis, had to know that this was pro forma, and that if elected Mr. Obama would pursue the same carrot-and-stick approach of the Europeans who had been negotiating with Iran for the past five years. He would do this in spite of the fact that the only accomplishment of the European diplomatic dance had been to buy the Iranians more time; in spite of the fact that they had spurned the carrots they were offered and defied the sanctions put in place by the Security Council; and in spite of the fact that the Russians and the Chinese—who had prevented stronger sanctions from being adopted—were still determined to veto measures like a blockade or a cutoff of gasoline imports that could conceivably do the trick.

How much time do we have? Secretary of Defense Robert Gates at first said that Iran was still five years or more away from the bomb. This estimate relied on the CIA, in which Mr. Gates worked for more than 25 years, including a stint (1991-93) as its director. But the CIA does not exactly have a brilliant record of tracking nuclear proliferation. It was wrong in 2007 about Iran's suspension of its nuclear program; wrong in 2003 about Syria's nuclear program; wrong in 2002 about Saddam Hussein's possession of weapons of mass destruction; and wrong in exactly the opposite direction before the First Gulf War in 1991, at whose end U.N. inspectors discovered that the Iraqi nuclear program was far more advanced than the American intelligence community had thought. By contrast, an increasing number of experts (possibly—to judge by hints he has thrown out—the current chairman of the Joint Chiefs of Staff, Adm. Michael Mullen, among them) agree with the head of Israeli military intelligence, who warns that the Iranians have already "crossed the nuclear threshold." Perhaps this is why, in an interview with the Financial Times, Mr. Gates has now backed away from his complacent five-year estimate ("How much more time [we have] I don't know. It is a year, two years, three years"). Admit it or not, then, the awesome choice of bombing Iran or letting Iran get the bomb is hard upon us.

Although it is certain that Mr. Obama has removed American military action from the table, it is difficult to tell whether he still thinks that he can talk Iran into giving up its nuclear program. On the one hand, his secretary of state reportedly admits that this is "very doubtful," but on the other hand she invites the Iranians to a conference on Afghanistan, then Mr. Obama himself sends a videotaped message proclaiming his "respect" for the brutal and tyrannical regime in Tehran, and finally it is announced that the U.S. will now join the Europeans, the Russians and the Chinese in the farcical negotiations with Iran we had previously shunned. Naturally the mullahs, seizing this gift of an opportunity to buy yet more time for reaching their nuclear goal, welcome the renewal of "constructive dialogue."

Yet to Mr. Obama's offer of a "new day" in the relations between us, the Ayatollah Ali Khamenei, the supreme leader of that regime, responds in a speech heaping scorn on the United States to the accompaniment of an audience chanting "Death to America." And far from having leaped at Mr. Obama's old offer of direct talks without preconditions, the Iranians have rebuffed it and insisted on a few preconditions of their own, beginning with an apology for all the "atrocities" we have committed against them and a promise of "deep and fundamental" change in our policy.

In order to avoid this humiliation, Mr. Obama (we learn from the New York Times) has chosen the slightly lesser humiliation of "seeking an understanding with Syria." The idea here, according to the Times, is that through the Syrians, "the United States could increase the pressure on Iran to respond to its offer of direct talks." And to compound the double foolishness of expecting the Syrians to lend us a helping hand with Iran and the Iranians to join with us against the Taliban in Afghanistan, Obama expects that "such an understanding [with Syria] would also give Arab states and moderate Palestinians the political cover to negotiate with Israel. That, in turn, could increase the burden on Hamas, the Islamic militant group that controls Gaza, to relax its hostile stance toward Israel."

Well, compared to this concatenation of wishful delusions, the prophet Isaiah's vision of the end of days when the lion will lie down with the lamb is a piece of hardheaded realism.

The upshot is that, barring military action by Israel (or a miracle), Iran will get the bomb, and sooner rather than later. What then? For some time now, many pundits with the ear of the Obama administration have finally recognized that neither carrots nor sticks nor any combination of the two can work. But instead of going on to support military action, they have fallen back on the position that we can "live with" a nuclear Iran. In line with the doctrine of Mutual Assured Destruction, they soothingly tell us, the mullahs can be deterred by the fear of retaliation much as the far more heavily armed Soviets and Chinese were deterred during the cold war. They also say that Ahmadinejad—who in his fanaticism admittedly sounds as though he can hardly wait to use nuclear weapons against Israel—neither runs the regime nor speaks for it.

What they forget to mention, however, is that Ahmadinejad could never have issued his threats without permission from the Ayatollah Khamenei, who does run the regime, and who has himself described Israel as a "cancerous tumor" that must and will be excised. Besides, even Ahmadinejad's predecessor as president and the current speaker of the Assembly of Experts, the Ayatollah Hashemi Rafsanjani, known far and wide as a "moderate," has declared that his country would not be deterred by the fear of retaliation:

If the day comes when the world of Islam is duly equipped with the arms Israel has in its possession . . . application of an atomic bomb would not leave anything in Israel, but the same thing would just produce damages in the Muslim world.
If this is the position of even a reputed Iranian moderate, how could Israel depend upon MAD to keep the mullahs from launching a first strike? Much anxiety has been voiced over the nuclear arms race that would be triggered throughout the region if Iran were to get the bomb, but in all truth we would be lucky if there were enough time for such a race to develop. For consider: if the Iranians were to get the bomb, the Israelis would be presented with an almost irresistible incentive to beat them to the punch with a pre-emptive strike—and so, understanding this, would Tehran. Either way, a nuclear exchange would become, if not inevitable, terrifyingly likely, and God alone knows how far the destruction would then spread.

Measured against this horrendous possibility, even the worst imaginable consequences of taking military action before the mullahs get the bomb would amount to chump change. But to say it again, with American military action ruled out, the only hope is that such action—which could at the very least head off the otherwise virtually certain prospect of a nuclear war—will be taken by Israel.

Forget about the Palestinian and Syrian "tracks": If there is a threat to Israel coming from Mr. Obama, it is that, having eschewed the use of force by the United States, he will follow through on his vice president's declaration that the Israelis would be "ill advised" to attack the Iranian nuclear sites and will prevent them from doing the job themselves.

Mr. Podhoretz's 12th book, "Why Are Jews Liberals?," will be published by Doubleday in the fall.

3) Heard That (Middle East) Song Before
By Cal Thomas

Prime Minister Benjamin Netanyahu visits Washington next week and if anyone wants an appropriate song to characterize the buildup to his meeting with President Obama it should be the old Sammy Cahn-Jule Styne number "I've Heard That Song Before," which goes, "It seems to me I've heard that song before; it's from an old familiar score; I know it well, that melody."


This time there is a twist. King Abdullah of Jordan, in an interview this week with the Times of London, raised the stakes by predicting war if the Palestinian side doesn't see real progress toward its own state.


Abdullah said a 57-state, not a two-state solution, is what's needed, which means all Arab and Muslim states, as part of any deal, would need to recognize Israel. Good luck with that.


Last week in London I spoke with Liam Fox, a conservative Member of Parliament and "shadow defense secretary." Fox told me, "There is a belief in some quarters that if only you can resolve the problems between Israel and Palestine, all the other problems in the Middle East, in a domino-like fashion, will fall into place. That is absolute nonsense."


Indeed, it is.


Fox said on a recent visit to Iran that Iranian politicians told him they realize they lack an air force to fight back if they are attacked by Israel, so they would use Hezbollah and Hamas. "They are part of our defense policy against Israel," Fox quoted them as saying, "Hamas is not part of the Palestinian problem. Hamas is the foreign-policy wing of Iran in Israel."


If words mean anything, consider these from the Hamas Charter: "The Islamic Resistance Movement believes that the land of Palestine is an Islamic Waqf consecrated for future Muslim generations until Judgment Day. It, or any part of it, should not be squandered: it, or any part of it, should not be given up. ... There is no solution for the Palestinian question except through Jihad. Initiatives, proposals and international conferences are all a waste of time and vain endeavors."


Hezbollah has its own charter. It says in part: "Our primary assumption in our fight against Israel states that the Zionist entity is aggressive from its inception, and built on lands wrested from their owners, at the expense of the rights of the Muslim people. Therefore our struggle will end only when this entity is obliterated. We recognize no treaty with it, no cease-fire, and no peace agreements, whether separate or consolidated."


Anyone see any wiggle room there? Have the actions of these two radical Islamic organizations, and their many cousins, demonstrated that they don't mean what they say?


As I have previously — and repeatedly — noted, the pressure from the United States ought not to be on Israel, which has mostly lived up to every agreement — from Oslo, to Madrid, to Wye River. U.S. pressure should be directed at those bent on Israel's destruction. Israel's enemies lost land through military action aimed at destroying Israel. They are winning it back through diplomacy, pressure and terrorist acts carried out by their proxies, Hamas and Hezbollah. Israel's enemies have used this newly acquired land to launch attacks.


Gaza is the latest example. Israel unilaterally ceded Gaza to the Palestinians, which has been used as a terrorist base for firing missiles at civilians inside Israel. Why would anyone think that additional concessions, including an autonomous Palestinian state, would deter Islamic extremists from fulfilling the mandates of their charters?


For people who regard any presence by Jews on "Muslim land" as a religious and personal affront and negotiations with "infidels" (that would be we American "crusaders" and the "Zionist entity") as against the will of their god, why should they be expected to compromise on a matter of doctrinal "truth"?


The Palestinians will deserve a state when they and their Arab-Muslim supporters prove by their actions and a reconsideration of their religious doctrines that they are prepared to allow Israel to exist in peace and have no intention of flooding a Palestinian state with "refugees" who might very well be used to finish the job so many of them wish Hitler had completed.


The question Netanyahu should ask President Obama is whether the United States wants to sustain the first democracy in the Middle East or whether it wishes to create another terrorist state?



Cal Thomas is co-author with Bob Beckel, a liberal Democratic Party strategist, of "Common Ground: How to Stop the Partisan War That is Destroying America".

4) Still the Biggest Missing Story in Politics
By Bruce Walker

In August of last year I wrote an article, "The Biggest Missing Story in Politics," which reviewed the single most important datum in the last thirteen Battleground Polls over a period stretching from early 2002 to late 2008. The critical fact, completely ignored by almost everyone, was that in answering Question D3, which asked the respondent what he considered his ideology to be, sixty percent of the American people described themselves as "conservative" or "very conservative."

In every single Battleground Poll, conservatives vastly outnumbered not only liberals, but moderates and undecided respondents combined. The Battleground Poll itself is a bipartisan poll, combining the resources of the Tarrance Group and Lake Research Partners. Unlike many polls driven by newspapers, networks, or other agenda driven organizations, this poll is one of the few which has no ideological agenda or partisan bias.


The last Battleground Poll, which came out after my article, no longer revealed the answer to Question D3. Did that mean that America, suddenly, stopped being an overwhelmingly conservative nation and had been seduced by Obama into being moderate or Leftist? No. The Tarrance Group did reveal the ideological breakdown of Americans, although in a different way than in the thirteen prior Battleground Polls.

Those earlier polls had asked people to describe themselves as "very conservative," "somewhat conservative," "moderate," "don't know," "somewhat liberal," or "very liberal." Those who chose "very conservative" or "somewhat conservative" were as low in some of the thirteen polls as 58% of the nation and as high in other polls as 63% of the nation, and the average of the polls was a rock solid 60%, year in and year out.


The Tarrance Group chose to look at ideology differently in its post-election poll. Respondents were asked to refine their definition of "conservative." So instead of being asked about the intensity of their ideology (i.e. "very conservative" versus "somewhat conservative"), the Battleground Poll changed the question.

Two questions replace the old Question D3. Now Americans were asked on social issues if they were "very conservative," "somewhat conservative," "moderate," "somewhat liberal" or "very liberal" as well as on fiscal issues if they were "very conservative," "somewhat conservative," "moderate," "somewhat liberal," or "very liberal." The Tarrance Group also provided data on the answers to this question within political parties.


The responses illuminated some aspects of the prior polls, but the over all result was the same: Americans, overwhelmingly, are conservative. There were some differences between social conservatives and fiscal conservatives. Twenty-six percent of Americans call themselves "very conservative" on fiscal issues and forty-three percent consider themselves "somewhat conservative" on fiscal issues. One percent of America is moderate on fiscal issues -- that vital "center" of American politics! -- and three percent "don't know." Twenty-two percent of Americans are "somewhat liberal" on fiscal issues, and a piddling five percent of Americans are "very liberal" on fiscal issues. When the mushy "moderate" and "don't know" respondents are excluded, fiscal conservatives outnumber fiscal liberals by seventy-four percent to twenty-six percent.


Social conservatives are the clear majority of America too, although the numbers are not quite as overwhelming. Thirty-four percent of America, more than one person in three, is "very conservative" on social issues and nineteen percent are "somewhat conservative" on social issues. One percent is moderate on social issues - again, that vital "center" of American politics! - and seven percent "don't know." Twenty percent are "somewhat liberal" on social issues and nineteen percent are "very liberal" on social issues. When the mushy "don't know" and moderates are taken out, social conservatives outnumber social liberals fifty-nine percent to forty-one percent.


Tarrance also helps explain what Sarah Palin and Rush Limbaugh are so popular with Republicans. Seventy-four percent of Republicans are both social and fiscal conservatives. Ninety-one percent of Republicans are fiscal conservative. And seventy-seven percent of Republicans are social conservatives. Any effort to change the Republican brand ought to begin with that dramatic fact.


What about Obama's own political party, the Democrats? Only forty-two percent of Democrats are both social liberals and fiscal liberals. Perhaps more amazing, twenty-three percent of Democrats, almost one in four, describe themselves as both social conservative and fiscal conservative. Forty-seven percent of Democrats describe themselves as fiscal conservatives, and thirty-four percent of Democrats describe themselves as social conservatives. Fifty-eight percent of Democrats consider themselves either a fiscal conservative or a social conservative or both.


These results, more detailed and more informative than past responses to Question D3 in previous Battleground Polls, do not alter the profoundly conservative character of the American electorate at all. A social conservative, who was perceived as a social conservative running against a social liberal, would win an easy majority of the American people in any election. A fiscal conservative, who was perceived as a fiscal conservative running against a fiscal liberal, would win a landslide greater than any in the history of these two political parties. A candidate perceive as both a social conservative and a fiscal conservative would win one quarter of the Democrat Party vote, if the Democrat was perceived as a liberal, and sweep the nation easily.


In fact, if a Democrat ran for his party's nomination as a conservative - and if the other candidates for the nomination were perceived as liberals - he ought to be able to compete for the fifty-eight percent of Democrats who were social conservatives, fiscal conservatives, or both. The biggest story in American politics has been answered again, with the data even more detailed and refined. The answer is the same - just the same - America is still, in every way and from every vantage, a conservative nation.


Bruce Walker is the author of two books: Sinisterism: Secular Religion of the Lie, and his recently published book, The Swastika against the Cross: The Nazi War on Christianity.

4a)Obama's Photo Epiphany: Why make it harder for the U.S. to defend itself?


President Obama yesterday put American soldiers and national security ahead of political braying from his campaign allies on the left. What a pleasant reversal.

The White House said it will now seek to block the release of photographs collected as part of military probes into accusations of prisoner abuse in Afghanistan and Iraq. The Pentagon had agreed last month to release the images by May 28, acceding to an American Civil Liberties Union request under the Freedom of Information Act.

"The President strongly believes that the release of these photos, particularly at this time, would only serve the purpose of inflaming the theaters of war, jeopardizing U.S. forces, and making our job more difficult in places like Iraq and Afghanistan," a White House official said, echoing arguments made on these pages. So the Administration will renew its legal appeals, including all the way to the Supreme Court if need be.

Mr. Obama thus took the advice of Defense Secretary Robert Gates and his leading generals that the photos would complicate their efforts to win over Muslim allies for America's antiterror mission. Release of the photos would also serve no public interest since they were collected as evidence in cases that have been investigated, and adjudicated when appropriate. Our guess is that Mr. Obama's political advisers also wanted to distance him from the decision to release the photos -- the better to shield him from any nasty fallout. Now the fault will lie with the ACLU.

Mr. Obama's change of heart was quickly denounced as akin to the "stonewalling tactics and opaque policies of the Bush administration" (the ACLU) and for "reneging on its legal obligation to release the torture photos" (Amnesty International). The President is learning, albeit slowly, that secrecy has its uses in wartime, and that the real goal of his allies on the left is to make it harder for the U.S. to defend itself.


5) CIA chief visits Israel, mixed Washington assessments on Iran


Director of the US Central Intelligence Agency Leon Panetta visited Israel two weeks ago to explore Israel's intentions with regard to a raid on Iran's nuclear facilities and its alignment with Egypt and Saudi Arabia for this shared objective.

On the one hand, Panetta showed Israeli leaders a new US report which estimates first, that Iran lacks adequate military resources to shield its nuclear sites from attack and, second, would pull its punches in responding to an Israeli strike. On the other, Washington fears linking up with Egypt and Saudi Arabia, Israel would be free to send its warplanes against Iran through the skies of its two Arab partners, without deferring to the United States.

This report was also presented by defense secretary Robert Gates on May 5-6 to Egyptian president Hosni Mubarak in Cairo and Saudi King Abdullah in Riyadh.

None of the three Middle East leaders took the report seriously because -

1. They could not make out if it was meant to encourage or deter an Israeli attack? Surely, the best time to strike would be before Iran acquires adequate defenses for its nuclear sites. Is that what the Obama administration is after?

2. Israel does not believe Iran would emulate Iraq's Saddam Hussein who refrained from hitting back after Israel demolished his nuclear reactor in 1981. Iran's rulers are committed to massive retaliation or else face a degree of popular contempt that would test the regime's survival.

Panetta and Gates alike returned home convinced that Israel, Egypt and Saudi Arabia and other Gulf emirates are far more fearful of a nuclear-armed Iran than of clashing with the Obama administration over its policy of engaging Iran.

This understanding prompted a policy review in Washington, which is still on going.

One outward symptom of a possible reversal was the sudden announcement on May 8 that President Obama had decided to again address the Muslim world from Egypt on June 4, ten days after Mubarak visits Washington. On the same day, he also renewed sanctions against Syria, which, after weeks of diplomatic pursuit, he accused of sponsoring terror and seeking weapons of mass destruction.

Washington's dawning appreciation that the rise of a nuclear-armed, terror-sponsoring Iran is the burning preoccupation of Middle East rulers, leaving the Palestinian issue for another day, will certainly make Israeli prime minister Binyamin Netanyahu's talks in the White House next Monday, May 18, a lot smoother. The clash which otherwise would have been unavoidable may now be averted.

5a) Obama warns Netanyahu: Don't surprise me with Iran strike
By Aluf Benn


U.S. President Barack Obama has sent a message to Prime Minister Benjamin Netanyahu demanding that Israel not surprise the U.S. with an Israeli military operation against Iran. The message was conveyed by a senior American official who met in Israel with Netanyahu, ministers and other senior officials. Earlier, Netanyahu's envoy visited Washington and met with National Security Adviser James Jones and with Secretary of State Hillary Clinton, and discussed the dialogue Obama has initiated with Tehran.

The message from the American envoy to the prime minister reveals U.S. concern that Israel could lose patience and act against Iran. It is important to the Americans that they not be caught off guard and find themselves facing facts on the ground at the last minute.

Obama did not wait for his White House meeting with Netanyahu, scheduled for next Monday, to deliver his message, but rather sent it ahead of time with his envoy.


It may be assumed that Obama is disturbed by the positions Netanyahu expressed before his election vis-a-vis Tehran - for example, Netanyahu's statement that "If elected I pledge that Iran will not attain nuclear arms, and that includes whatever is necessary for this statement to be carried out." After taking office, on Holocaust Memorial Day Netanyahu said: "We will not allow Holocaust-deniers to carry out another holocaust."

Netanyahu and Defense Minister Ehud Barak do not oppose American dialogue with Tehran, but they believe it should be conducted within a limited window of time, making it clear to Iran that if it does not stop its nuclear program, severe sanctions will be imposed and other alternatives will be considered.

The American concern that Israel will attack Iran came up as early as last year, while president George W. Bush was still in office. As first reported in Haaretz, former prime minister Ehud Olmert and Barak made a number of requests from Bush during the latter's visit to Jerusalem, which were interpreted as preparations for an aerial attack on Iran's nuclear facilities.

Following the Bush visit to Jerusalem, about a year ago the previous administration sent two senior envoys, the chairman of the Joint Chiefs of Staff Adm. Mike Mullen, and the former U.S. national intelligence chief Mike McConnell to demand that Israel not attack Iran.

The previous administration also gave the message greater weight through Mullen's public statement that an Israeli attack on Iran would endanger the entire region. Since that statement, Mullen has met a number of times with his Israeli counterpart, Israel Defense Forces Chief of Staff Gabi Ashkenazi.

5b) IAF practicing MIG-29/F-16 dogfights

Israel Air Force test pilots are flying MIG 29 jets and conducting dogfights
against the IAF's F-16 fighters, Channel 2 revealed Wednesday evening.
The MIG 29, developed by the soviets in the 1970s, is one of the best
fighter jets used by eastern and Arab countries, as well as by Syria and
Iran. It was developed to counter American-made jets such the F-16 or
F/A-18.

The jets were loaned to Israel by an unnamed foreign country. The experiment
is meant to prepare IAF pilots for missions where they might have to fight a
foreign air-force.

"We tested them - we trained the IAF pilots against them," an unnamed IAF
official said.

The IAF employs ten test pilots. The training of each costs about a million
dollars, but the experience gleaned from the test pilots, the unnamed
official said, "is priceless."

"You fly in places and in certain conditions in a way never attempted
before," an unidentified test pilot said. "Once, a piece of the jet's body
broke during an experiment but the crew managed to land it safely."
A test jet is just like a regular one, except for special sensors which
cover literally every aspect of its mechanical and electronic systems and
can be monitored from the ground for assessment.

An additional experiment conducted recently by the air force involved
loading an F-16 with weapons to its utmost capacity, or "flight in a heavy
formation," as the test pilot labeled it. The experiment was meant to
measure the pilot's safety and the fighter's capability when it was carrying
the maximum amount of armaments.

A jet so armed might be used in a long-distance sortie. The pilots
interviewed would not name which foreign countries might be the targets of
such sorties, but it was clear the main target of such an ambitious mission
would be Iran's nuclear installations.

5c)Obama the rookie:US president’s disastrous Middle Eastern policy will not stop Iran
By Mordechai Kedar

Thirty years ago, at the end of 1978 and beginning of 1979, US President Jimmy Carter’s blind approach and his obsessive concern for human rights everywhere, and particularly in the Shah-ruled Iran, prompted Khomeini’s rise and brought Khomeinism to power. Carter did not permit the Shah to handle the protests against him, that is, to disperse them with gunfire. The result was the ayatollah takeover of Iran and the murder of thousands of Shah supporters. Everything the world suffered, is suffering, and will suffer because of Iran is the direct result of the short-sightedness of an American president who understood nothing in the ways of the Middle East.

The enduring problem of American politicians is that they view the world via their own cultural lenses and think that “if only we engage in dialogue with the others” they will be “like us,” “just like everyone else,” and “will become nice”; if only we give them jobs and comply with their “just” demands (the right of return, our capital which never had Palestinian significance, unwillingness to recognize our state, etc.) they will go to work in the morning and return in the evening to play with their children and fish.



Obama is currently making the same mistakes Carter did. He naively thinks that through dialogue with the ayatollahs he will achieve what the Europeans have failed to achieve for many years. He refuses to read what many researchers, politicians, and statesmen worldwide write, and refuses to listen to all those concerned by Iran – Arabs, Israelis, and Europeans – who have no doubt that the ayatollahs intend to first take over the Middle East, and later possibly take over the entire world, should they be given the chance.



Only a blind person would not see the manner in which Iran, even before it has turned nuclear, quickly changes the face of the Middle East. Iran’s long arms are already tightly grasping Lebanon, Iraq, and Gaza, and are also decisively and powerfully directed at other states such as Egypt, Morocco, Jordan, Oman, Bahrain, and Saudi Arabia.



Only a deaf person would not hear the cries of distress emerging from the Arab world (irrespective of Israel and its concerns,) as its leaders see the Persians, their historically hated rivals, rattling their sabres en route to paying back the Bedouins of the desert, uncultured barbarians in their view, for ruining, in the seventh century, the Persian nation, which was educated, progressive and modern at the time.



Only a blind person would fail to see the preparations undertaken by Iran’s Shiite leaders en route to taking their revenge on the Sunnis for 1,350 years of oppression, persecution, and assassinations undertaken by the Sunnis against the Shiite opposition any time and any place they could do it.



Israel’s disappearance to make no difference

Obama thinks that if only Israel will be reduced to the size appropriate for it, that is, the 1949 borders (the “Auschwitz borders” in the words of Abba Eban, a peace-loving dove,) the Arab and Muslim world will sit around the bonfire with the Americas and sing. Some members of his team believe that Israel is the source of the problems in the Arab and Islamic world, and that if only peace will prevail between Israel and the Palestinians, the problems of Iraq, Afghanistan, Sudan, Lebanon, the Shiites, the Sunnis, al-Qaeda, and the Islamic Brotherhood will be resolved at once.




I hereby offer Obama and his people very important information: Even if Israel decides to evaporate, disappear, and wipe itself off the map, all the other problems will continue to kill, just as was the case when Israel existed.



Only an American president who decided to engineer the Arab and Islamic world in line with American standards can fall and make others fall into the trap of historical mistakes that Carter and Bush fell into, each in their own time and style. As a result of their errors, thousands of people in the region were massacred, killed, and wounded.



The American president conducts himself vis-à-vis the Arab and Islamic world like a rookie trying to command an armored division. Obama is rushing forwarded on an imaginary horse, and the people of the region can only hope that his terrible mistakes will not cost the lives of additional thousands.



The gravest matter of all is that some Israelis played a significant role in shaping Obama’s mistakes, and the blood of their brethren, other Israelis, will be the price we shall pay for the actions of those who sold Obama their imaginations, along with several foolish ideas that undermined our security and our self-confidence.



Dr. Mordechai Kedar is a lecturer at Bar-Ilan University’s department of Arabic.

5c) Why the push for nukes?
By AVIGDOR HASELKORN

The closer Iran gets to the bomb and the clearer it becomes that the international community is unable or unwilling to stop it, the more frequent the argument is made that Iran's acquisition of nuclear weapons may prove uneventful. There is no evidence to suggest Iran will behave in any but a responsible manner and accede to the unwritten rules of strategic deterrence, it is said.

Iran's foreign policy has traditionally been marked by caution. Its apparent opting for a turnkey nuclear posture instead of rushing headlong to build a bomb in itself indicates as much. Despite the bloodcurdling declarations emanating these days from Teheran, the Iranians are keenly aware that by acquiring nuclear armaments they will automatically become the target of their enemies' nuclear weapons.

On the face of it these seems like valid points. But a closer examination of recent history suggests that when it comes to strategic deterrence, Iran's record is much murkier. First, Iran has continuously demonstrated that it was not deterred by various warnings and sanctions, and instead continued to pursue its nuclear weapons program.

Even the 2007 CIA National Intelligence Estimate (NIE) which claimed Iran suspended its nuclear program in 2003, because of "increasing international scrutiny and pressure," in effect qualified its judgment to only one aspect of the Iranian program: the construction of nuclear warheads. And, the NIE expressed only "moderate" confidence that the suspension has not been lifted already.

WHILE MUAMMAR GADDAFI of Libya was so unnerved by the US invasion of Iraq that he agreed to dismantle his country's entire weapons of mass destruction program, Iran continues to discount stern and increasingly overt warnings. As recently as 2007, in a display widely seen as sending a strong signal to Teheran, Israel launched an air strike that reportedly destroyed a Syrian nuclear reactor under construction. Yet Iran remained undeterred.

Similarly in 2006, during the Second Lebanon War, Teheran could not have known what would be Israel's response to Hizbullah firing thousands of rockets, many of which were produced and delivered by Iran, at its cities. For example, Israel could have chosen to launch a full-scale invasion of Lebanon to destroy Hizbullah's rocket arsenal or even opt to confront Iran itself in retaliation.

But Teheran never told its Lebanese proxies to stop the firing. Instead, its supreme leader Ayatollah Ali Khameini declared that "resistance" is the only way to confront, what he called " the wild wolf of Zionism and the aggression by the Great Satan [the US]." Given that arming Hizbullah with a vast rocket stockpile was for Iran vital to deterring Israel from launching a preemptive strike against its nuclear sites, its readiness to jeopardize this asset to uphold its ideological vehemence is remarkable as it is worrying.

After the war Iran's conduct not only revalidated how central was Hizbullah's arsenal to its own nuclear aspirations, but should have redoubled the disquiet about its readiness to forgo it for the sake of a "sideshow." Iran (and Syria) worked tirelessly to restock Hizbullah's rocket stores despite UN Security Council Resolution 1701. Worse yet, Teheran endeavored to upgrade the weapons supplied to Hizbullah both in terms of range and accuracy. Today Hizbullah increasingly fields rockets which could be used for counterforce missions and thus potentially perform as first strike weapons not just the inaccurate counter-city (or second-strike) rockets it possessed in 2006.

IRAN'S UNDETERRABILITY is also evident by its actions in Iraq. For example, Gen. David Petraeus, then the top US military commander in Iraq, said in October 2007: "They [the Iranians] are responsible for providing the weapons, the training, the funding and in some cases the direction for operations that have indeed killed US soldiers. There is no question about the connection between Iran and these [attacks]."

While some may argue Iran was cleverly establishing itself in Iraq ahead of a US pullout, the question arises as to Iran's cost-benefit calculations. Were these provocations considered so vital as to risk providing the Bush administration the pretext for attacking its Natanz uranium-enrichment facility in retaliation, for instance?

In fact, Iran is pressing ahead with its nuclear plans even though the geopolitical circumstances, which may have been seen as justifying them once, have radically transformed in its favor. It is entirely reasonable to ask where on earth is the threat to Iran today that allegedly requires bolstering its deterrence? The main danger - Iraq under Saddam - dissolved in 2003. The US military presence in Iraq, it is now clear, was never a springboard for "aggression" against the mullahs, and in fact has been used by the Iranians as a virtual hostage to deter any "adventurism" against its nuclear buildup.

Indeed, with the change of administrations in the US and the deep economic crisis there, the likelihood of a military undertaking against Iran, if ever there was one, has virtually evaporated. Russia is a major economic partner, including as a supplier of nuclear technology as well as of conventional arms, and Israel is only a threat if Teheran continues the nuclear race or possibly if it comes under another major attack by Iran's proxy in Lebanon.

Taken together, there are sufficient grounds to conclude that the argument about a durable nuclear balance emerging in the Middle East is based on a best-case scenario when it comes to Iran. Even if it once was, boosting its strategic deterrence no longer seems to be Iran's motive for acquiring nuclear arms, nor does its record of conflict involvement leave much doubt about its undeterrability. Both aspects in fact provide a compelling argument to use all available means to stop Iran from acquiring nuclear weapons. To argue otherwise is rooted in impotence not coherence.

The writer is the author of The Continuing Storm: Iraq, Poisonous Weapons and Deterrence (Yale University Press, 1999).

6) Abdullah urges PM to commit to 2-state solution immediately


Prime Minister Binyamin Netanyahu made an unannounced, lightning visit to Aqaba on Thursday where Jordan's King Abdullah II urged him to commit to the establishment of a Palestinian state.

Abdullah pressed the prime minister to "immediately declare his commitment to a two-state solution, acceptance of the Arab peace initiative and to take necessary steps to move forward toward a solution," according to a royal palace statement. It did not give Netanyahu's response.

The Arab peace initiative would offer Israel relations with the 23 Arab League members in exchange for its withdrawal from land it conquered in the 1967 Six Day War, a just solution for Palestinian refugees and the establishment of a Palestinian state with east Jerusalem as its capital.

Abdullah said there "is consensus in the international community that there is no alternative to the two-state solution."

Netanyahu's brief visit comes ahead of the prime minister's trip to the US on Saturday night and his meeting with US President Barack Obama on Monday.

Abdullah, who met Obama last month, was the first regional leader to meet the new US president.

During a visit to Berlin earlier this month, Abdullah said Israel, Syria, Lebanon and other Arab nations should sit down together to try to resolve the Middle East conflict under a new "combined approach," which he said was currently under discussion with the US.

Speaking to NBC's "Meet the Press" at the end of April, Jordan's king urged Obama to take a more forceful role in the peace process between Israelis and Palestinians, warning of a new Mideast war if there is no significant progress in the next 18 months.

Abdullah and other regional leaders are seeking to lay the groundwork for restarting Israel-Arab peace efforts. Abdullah's lobbying has been in step with the Obama administration's efforts to link progress on Israel-Arab peacemaking to progress on curbing Iran's nuclear ambitions.

Netanyahu, however, argues that the threat from Iran and its regional proxies - Hizbullah and Hamas- must be confronted first, before any progress can be made in peacemaking.

On Monday, he met Egyptian President Hosni Mubarak in Sharm e-Sheikh and said Israel expected Egyptian "help in the struggle against extremists and terrorists who threaten peace." He also said he hoped for an immediate renewal of negotiations with the Palestinians.

Palestinian Authority President Mahmoud Abbas has said he would not meet with Netanyahu until he agrees to pursue Palestinian independence and freeze construction in West Bank settlements. On Thursday, Abbas met with Syrian President Bashar Assad in Damascus to discuss Abdullah's new Mideast peace push and inter-Palestinian reconciliation. Abbas did not meet Hamas-leader Khaled Mashaal or any other of the group's senior officials on his visit to the Syrian capital.

Abdullah traveled to Damascus earlier this week to promote his ideas to Assad.

Although Thursday's trip to Jordan was not formally publicized ahead of time, government sources said some two weeks ago that Netanyahu and Abdullah might meet prior to the former's trip to the US.

Meanwhile, before Netanyahu heads out to Washington, National Security Council head Uzi Arad, the prime minister's senior adviser Ron Dermer and Attorney Yitzhak Molcho, his personal go-between with the Obama administration, were set to fly to the US.

The three were expected to meet US National Security Council official Dan Shapiro to prepare for Netanyahu's meeting with Obama.

Also Thursday, Israel Radio quoted a senior Jerusalem source as saying that Israel had assured the US that it was not planning any "surprises" on the Iranian issue by making any moves that weren't coordinated with Washington.

7) Kuwait University Professor: 'A U.S.-Iran Deal... Will Most Likely Be at [the Arabs'] Expense'

In an op-ed titled "U.S.-Iran Relations Worry Arabs," Dr Abdullah Al Shayji, professor of international relations and head of the American Studies Unit at KuwaitUniversity, discussed the Arabs' fears of "another betrayal by the Americans." The following is the op-ed, as published May 10, 2009 in the English-language daily Gulf News.

The Arabs "Fear Another Betrayal by the Americans if the Iranian Price is Right"

"U.S. officials have reassured Gulf and other Arab officials that America's opening up to Iran won't be at the expense of the Arabs because of the historical and strategic ties between the U.S. and its Arab partners and allies in the region.

"The latest assurance came from U.S. Defense Secretary Robert Gates during his visits to Egypt and Saudi Arabia. He downplayed the thawing of relations with and the cozying up to Tehran, which is keeping Arabs on edge. They fear another betrayal by the Americans if the Iranian price is right.

"'There's probably some concern in the region that may draw on an exaggerated sense of what's possible. And I just think it's important to reassure our friends and allies in the region that while we're willing to reach out to the Iranians, as the president said, with an open hand, I think everybody in the administration, from the president on down, is pretty realistic and will be pretty tough-minded if we still encounter a closed fist,' Gates said. He went on to lament Iran's 'closed fist.'

"Gates highlighted the opening up to Iran 'for the purpose of improving security throughout the region.' In order to reassure those of us in the Arab world, Gates made it clear that 'building diplomacy with Iran will not be at the expense of our long-term relationship with Saudi Arabia and other Gulf states that have been our partners and friends for decades.'

"But these reassurances, ironically, seem to strengthen our sense of insecurity and confirm our fears about the prospect of a grand bargain between the two rivals if the price is right - and if the Israelis endorse it, after ensuring that Iran's nuclear program is discussed."


"The Obama Administration Needs Iran to Play a Constructive Role in the Arab-Israeli Peace Process - And To Rein In Its Proxies in Lebanon and Gaza"

"This dialogue could be more direct and gather steam after the Iranian presidential elections on June 12. What is alarming for us in the region is the publication, a few days ago, of an intelligence report by the U.S. Senate Foreign Relations Committee. The report cites Iran's nuclear progress, and says faulty intelligence was responsible for underestimating Iran's progress towards designing a nuclear warhead before Tehran halted its program in 2003. The report suggests that the U.S. engagement with Iran must convince Tehran to halt its nuclear program and accept tough international controls.

"But what alarms the Arabs are the current geo-strategic realities, which Iran uses for its own advantage and employs to serve its interests and project its power. This is made possible as a result of U.S. miscalculations and through Tehran's proxies in the region.

"Iran realizes that the U.S. is seeking 'responsible withdrawal from Iraq.' Iran is following the deteriorating security situation in Afghanistan, and is alarmed at the reemergence of the Taliban. Iran is worried at the situation in Pakistan as the U.S. seeks to stabilize that nuclear state, which has become a major security challenge for the Obama administration.

"The Obama administration is increasingly engaged in what Richard Hass calls the 'war of choice' - that is, the war in Afghanistan, the major frontline in the 'war on terror.'

"In addition to this, the Obama administration needs Iran to play a constructive role in the Arab-Israeli peace process, and to rein in its proxies in Lebanon and Gaza. All of these regional problems give Iran a strong card to play in its confrontation with the Americans."


"A U.S.-Iran Deal... Will Most Likely Be At Our Expense... We Will Have Only Ourselves to Blame"

"Gates said in December that the U.S. was not seeking 'regime change' but 'behavioral change' in Iran. This line was echoed last week by Senator John Kerry, chairman of the Foreign Relations Committee, who stated that 'we [Americans] are not for regime change [in Iran]. Our effort must be reciprocated by the other side. Just as we abandon calls for regime change in Tehran and recognize a legitimate Iranian role in the region, Iran's leaders must moderate their behavior and that of their proxies, Hezbollah and Hamas.'

"This is exactly what worries the Arabs in the region. What does Kerry mean when he bluntly says he 'recognizes a legitimate Iranian role in the region?' Why would Iran cave in and acquiesce, and be cooperative and accommodating, if the price was not right? The U.S. has already given Iran the ultimate assurance - that there will be 'no regime change.'

"The Americans have to put themselves in the Arabs' shoes and see their dilemma. The siege mentality that has set in does not emanate from speculations but from the situation that is unfolding before our eyes.

"When the Americans deny something, it is likely to be true. So, should the Arabs in general and the Gulf states in particular be concerned by the ongoing open fist-closed fist monologue, which could evolve into a productive dialogue when the interests of Washington and Tehran intersect? Or are concerns about the possibility of a 'grand bargain' between the U.S. and the Iranians unfounded, as Gates and U.S. Secretary of State Hillary Clinton contend?

"If a U.S.-Iran deal comes through, it will most likely be at our expense. If we do not wake up and get our act together, we will be in for a rude awakening. Then we will have only ourselves to blame."

8).Unions vs. Taxpayers: Organized labor has become by far the most powerful political force in government.
By STEVE MALANGA

Across the private sector, workers are swallowing hard as their employers freeze salaries, cancel bonuses, and institute longer work days. America's employees can see for themselves how steeply business has fallen off, which is why many are accepting cost-saving measures with equanimity -- especially compared to workers in France, where riots and plant takeovers have become regular news.

But then there is the U.S. public sector, where the mood seems very European these days. In New Jersey, which faces a $3.3 billion budget deficit, angry state workers have demonstrated in Trenton and taken Gov. Jon Corzine to court over his plan to require unpaid furloughs for public employees. In New York, public-sector unions have hit the airwaves with caustic ads denouncing Gov. David Paterson's promise to lay off state workers if they continue refusing to forgo wage hikes as part of an effort to close a $17.7 billion deficit. In Los Angeles County, where the schools face a budget deficit of nearly $600 million, school employees have balked at a salary freeze and vowed to oppose any layoffs that the board of education says it will have to pursue if workers don't agree to concessions.

Call it a tale of two economies. Private-sector workers -- unionized and nonunion alike -- can largely see that without compromises they may be forced to join unemployment lines. Not so in the public sector.

Government unions used their influence this winter in Washington to ensure that a healthy chunk of the federal stimulus package was sent to states and cities to preserve public jobs. Now they are fighting tenacious and largely successful local battles to safeguard salaries and benefits. Their gains, of course, can only come at the expense of taxpayers, which is one reason why states and cities are approving tens of billions of dollars in tax increases.

It's not as if we haven't seen this coming. When the movement among public-sector workers to unionize began gathering momentum in the 1950s, some critics, including private-sector labor leaders such as George Meany, observed that government is a monopoly not subject to the discipline of the marketplace. Allowing these workers -- many already protected by civil-service law -- to organize and bargain collectively might ultimately give them the power to hold politicians and taxpayers hostage.

It wasn't long before such fears were realized. By the mid-1960s, dozens of cities across America were wracked by teachers' strikes that closed school systems. Groups like New York City's transit workers walked off the job in 1966, bringing business in Gotham to a near halt. The United Federation of Teachers led an illegal strike which closed down New York City schools in 1968.

Widespread ire against strikes by public workers produced legislation in many states outlawing them. That prompted government workers to retreat from the picket lines into the halls of government. In Washington, they organized political action committees, set up sophisticated lobbying efforts, and used their muscle to help elect sympathetic public officials.

Today, public-sector unions sit atop lists of organizations that devote the most money to lobbying and campaign contributions.

In Pennsylvania, a local think tank, the Commonwealth Foundation, counted the resources of the state's teachers union a few years ago. It had 11 regional offices, 275 employees and $66 million in annual dues. In Connecticut, representatives of the teachers union camped outside the legislators' doors in 2005 to keep tabs on school reformers who were calling on these officials to expand school choice.

And in California, unions spent more than $50 million in 2005 to defeat a series of ballot proposals that would have capped growth in the state's budget. Now the state's teachers union is putting its clout behind a ballot initiative, to be voted on next week, that would restore more than $9 billion in educational spending cut from the state's budget.

The results of such efforts are evident in the rich rewards that public-sector employees now enjoy. A study in 2005 by the nonpartisan Employee Benefit Research Institute estimated that the average public-sector worker earned 46% more in salary and benefits than comparable private-sector workers. The gap has only continued to grow. For example, state and local worker pay and benefits rose 3.1% in the last year, compared to 1.9% in the private sector, according to the Bureau of Labor Statistics (BLS).

But the real power of the public sector is showing through in this economic crisis. Some five million private-sector workers have lost their jobs in the last year alone, and their unemployment rate is above 9% according to the BLS. By contrast, public-sector employment has grown in virtually every month of the recession, and the jobless rate for government workers is a mere 2.8%. For anyone who thinks such low unemployment numbers are good news, remember that the bulging public sector must be paid for with revenues that most governments don't currently have. This is one reason for a spate of state and local tax increases, such as $5 billion in tax increases New York state passed in April, and $12 billion in tax increases California's legislature agreed to in February that will only become law if voters pass a series of ballot initiatives next week.

The next lesson we are likely to learn is that voter revolts against new taxes are no longer effective because of the might that these public- sector groups now wield. The tax-cut uprising of the late 1970s began in California with Proposition 13 capping property taxes. It then spread to more than a dozen states before it became a national movement that helped elect Ronald Reagan. The next tax revolt, during the recession of the early 1990s, helped sink officials like New Jersey Gov. James Florio and produced ballot propositions in places like Colorado that capped spending or made tax increases more difficult.

Now powerful and savvy, public unions have moved effectively to quash antitax movements. In New Jersey, public unions derailed a taxpayer revolt in 2005 by using their legislative clout to water down a bill that would have created a state constitutional convention to enact property-tax reform. Meanwhile, under pressure from unions, state legislatures in places like Florida have been tightening rules and requirements for passing voter initiatives and referenda -- blunting a favorite tool of antitax groups.

In states like Iowa where public unionization rates are still low government workers have had to accept concessions. But allies of the unions in Washington are working to rectify that situation with union-friendly legislation like the card check bill, which will make organizing much easier.

In the private sector such efforts will still be subject to the demands of the marketplace. Employers who are too generous with pay and benefits will be punished. In the public sector, however, more union members means more voters. And more voters means more dollars for political campaigns to elect sympathetic politicians who will enact higher taxes to foot the bill for the upward arc of government spending on workers. That will be the pattern for the indefinite future unless taxpayers find a way to roll back the enormous power public workers have acquired.

Mr. Malanga is a senior fellow at the Manhattan Institute.

8a) Meet Craig Becker, labor's secret weapon

Arlen Specter's party switch has renewed the debate over the legislative prospects for "card check," which would effectively eliminate secret ballots in union organizing elections. But Big Labor might not even need card check if Craig Becker has his way.

Mr. Becker is one of two recent National Labor Relations Board appointments by President Obama. The five-member NLRB supervises union elections, investigates labor practices and, most important, issues rulings that interpret the National Labor Relations Act. Mr. Becker, who is currently the associate general counsel at Andy Stern's Service Employees International Union, is all for giving unions more power over companies in elections. Only he's not sure he needs to wait for Congress.

Current law on organizing provides advantages and restrictions for both sides. Employers are required to provide union reps with a list of employees and their addresses. Union organizers can visit employees at home, but companies cannot. Organizers can also make promises to employees (such as obtaining raises), which employers cannot. Companies can argue their position at a work site up to 24 hours before an election, but they are barred from coercing employees. Both sides get a seat at the table during NLRB hearings about the scope of an election or complaints about how it was conducted.

Mr. Becker has other ideas. In a 1993 Minnesota Law Review article, written when he was a UCLA professor, he explained that traditional notions of democracy should not apply in union elections. He wrote that employers should be barred from attending NLRB hearings about elections, and from challenging election results even amid evidence of union misconduct. He believes elections should be removed from work sites and held on "neutral grounds," or via mail ballots. Employers should also be barred from "placing observers at the polls to challenge ballots."

More extraordinary, Mr. Becker advocated a new "body of campaign rules" that would severely limit the ability of employers to argue against unionization. He argued that any meeting a company holds that involves a "captive audience" ought to be grounds for overturning an election. If a company wants to distribute leaflets that oppose the union, for example, Mr. Becker said it must allow union access to its private property to do the same.

Mr. Becker isn't clear about which of these rules can be implemented by NLRB fiat, and which would require an act of Congress, but his mindset is clear enough. He's willing to push NLRB discretion as far as possible to tilt today's labor rules in favor of easier unionization.

Union leaders argue that they need these rule changes because they are at a disadvantage during elections. But a new report from the Bureau of National Affairs shows unions winning 67% of private ballot representation elections conducted by the NLRB in 2008, the highest rate since BNA began analyzing data in 1984. Meanwhile, 95% of all elections are conducted within 56 days of a union petition filing, with a median of 38 days. This suggests that the real union problem is that most workers don't want a union election in the first place. Employees are well aware of what has happened to the steel, auto and other heavily unionized industries.

Mr. Becker has a confirmation hearing coming up, and Senators should ask him to explain why someone who wants to rig the rules to favor unionization should sit on a panel that is supposed to enforce fairness in union elections.

9)Health-Care Reform and the 'Innovation Test: Government-run insurance plans have curtailed access to new medicines.
By JOHN C. LECHLEITER

Two dramas are underway in health care. The first is set in laboratories and clinics, and it is a hopeful story of how innovation may continue to improve human health. The other drama is set in Washington conference rooms and corporate boardrooms, and it concerns the reform of health-care access, financing and regulation. As a scientist who leads what I call "the last unmerged large pharmaceutical company" (more on that in a moment), I am the rare player who moves between these two stages -- and I do so with growing concern.

I've spent three decades working in or near biopharmaceutical research and development. During that time, I've witnessed breakthroughs as diverse as biosynthetic human insulin, bone-forming agents for treating osteoporosis, new cancer therapies, and a first-ever treatment for severe sepsis go from glimmers of intuition to everyday medical tools.

Inventions such as these -- and my list includes only the partial output of the company I work for -- have transformed the most basic expectations of human life in the last century. Today, the average life expectancy at birth in the U.S. is 78; when my mother was born in 1928 it was 57. (She's still in great health, by the way.)

Even in the last two decades of the 20th century, new medicines accounted for 40% of the increase in life expectancy in more than 50 countries, according to a recent study by Columbia University economist Frank Lichtenberg. In other words, for every year that life expectancy has increased, five months can be attributed to the availability of new medicines.

The progress so evident in this first drama is poised to continue and even accelerate in the years ahead. Genomics, systems biology and other basic-research streams of new knowledge are bringing forward clues about the origins of disease -- and giving drug developers fresh insights to apply to an amazing array of new targets.

Today, a record 861 new medicines and vaccines are in human trials or awaiting regulatory approval in the fight against cancer, along with more than 300 for heart disease and stroke, another 300 for mental illnesses -- including Alzheimer's disease -- and 90 for HIV/AIDS.

U.S.-based private industry is the heart and soul of this innovation drama, investing $58 billion in research and development for new medicines in 2007 alone. Virtually no discovery reaches the point of regulatory approval if it is not shepherded through clinical development by a large biotech or pharmaceutical company. This means companies too often maligned as "Big Pharma" are in fact the only entities with the right combination of expertise, infrastructure and financing to pull this off.

Yet in today's policy-reform drama -- if early clues from Washington are a guide -- the requirements of innovation may be written out of the script. Already in defensive mode, several large pharmaceutical companies are restaging the old merger play -- continuing to narrow the ranks of firms with the full-scale capacity to innovate. Meanwhile, skittish investors have retreated, leaving nearly half of all publicly traded biotech companies with less than a year of cash on hand. These trends amount to show-stoppers if they continue.

Biomedical innovation is not incompatible with the health-care reform goals of universal access, quality improvement and cost control. On the contrary, without new, more effective medicines -- along with new devices and diagnostic tools, and better treatments and surgical techniques -- it will be impossible for larger numbers of Americans to obtain better health care at a manageable cost.

So it is vital to all of us that we insist that reform proposals pass the "innovation test." Providing insurance to millions of Americans through a government-run plan would fail the test. Similar efforts around the world have led to rationing of health care and created hurdles between patients and the most advanced treatments. On the other hand, innovation would remain reasonably secure if universal access were achieved through tax credits and government subsidies that allow patients to choose from a variety of private health-financing options.

Curtailing health-care costs by allowing the federal government to dictate prices for branded medicines also would fail the test. Price controls and rebate requirements tend to be arbitrary and make it much harder for innovators to attract and recoup investments. For their part, private insurers and patients tend to control costs by insisting on value -- forcing companies to demonstrate how the effectiveness or broader savings generated by their product justifies its price. That approach maintains the incentives for innovation and is yet another reason not to crowd out the free market.

Proposed laws that could weaken the enforcement of patents on biotechnology products flunk the innovation test as well. Some in Congress want to leave the creators of new biotech medicines with only small periods of time in which to retain exclusive use of research-and-development and manufacturing-process data for these products. This might speed the arrival of copied versions of some medicines, but it would kill critical incentives to discover and develop them in the first place.

In contrast, the "Pathways to Biosimilars Act" now before Congress gets the mix right. It does this by giving innovators the time needed to recoup their research investments while defining a clear framework for legal copying of biotech products down the road. It strikes the right balance between innovation and competition.

Our legislators in Washington still have the power to keep innovation in the health-care reform script. Not doing so would be a true American tragedy.

Mr. Lechleiter is chairman and CEO of Eli Lilly & Co.

10) Earmark Nation:The Founders never imagined spending such vast sums.
By DANIEL HENNINGER

In the year of our nation, 2005, "earmark," a term of trade known only to political technicians, became a household word. The Bridge to Nowhere, a mere outlay of $320 million in that year's $2.5 trillion federal budget, led to the decline and fall of the Republican Party. In 2006, a disgusted American electorate threw Republicans from office, and transferred House control to the Democrats.

AP Rep. John Murtha.
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When earlier this week President Obama signed a $410 billion spending bill to keep the government running through the fall, every account of the event noted the 800-pound contradiction in the room. Mr. Obama had campaigned against earmarks, even saying he would cut them back to levels before 1994, the start of the Gingrich-GOP interregnum. Now here was Obama as president signing a bill soaked in earmarks.

In the course of explaining his way through this contradiction, Mr. Obama dropped a hard truth of modern American politics: "Individual members of Congress understand their districts best, and they should have the ability to respond to the needs of their communities."

This is the Murtha earmark defense. Rep. John Murtha, Democrat from Johnstown, Pa., is the current holder of what we might call the Ted Stevens Trophy, a rotating award for whichever Member of Congress the press is vilifying most for earmark abuse. Mr. Murtha's stock defense of the budget loot he has earmarked and shipped to Johnstown is that if he didn't do it, bureaucrats who know nothing about the real America would decide where to spend the money. That's what President Obama just said. Murtha himself calls the $787 billion stimulus package the Obama earmarks bill.

Pork-barrel spending's not just limited to a few corrupt politicians anymore. Daniel Henninger explains. (May 14)
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Mocking this presumed hypocrisy is good sport, but the Murtha example deserves a closer look. You just might find that you are staring at a Pogo problem: We have met the enemy, and he is us.

Consider: In March, Pittsburgh Post-Gazette reporter Dennis Roddy went to Johnstown and discovered the rationale its citizens had built around what Mr. Murtha does.

Briefly, this steel town was dying in the 1970s. The city fathers decided their future lay with John Murtha's seniority, and over the years his earmarks, in the billions, created companies that use the locals' skills, such as welding, to produce armor plating or Humvees. Johnstown became a mini-defense industry.

PodcastListen to Daniel Henninger's Wonder Land column, now available in audio format.
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Mr. Murtha says without apology: "Johnstown would have been like Detroit is today. We would have been a ghost town."

Along with this salvation, however, came such excesses as the John Murtha Airport, which has gotten $150 million of federal funds. It has three flights daily to and from one city -- Washington, D.C.

To this, the Johnstown locals likely would say, So what? That's probably what locals in congressional districts everywhere say about their earmarks.

About all this, John Murtha has said something to ponder: "If I'm corrupt, it's because I take care of my district."

When we speak of public corruption, we normally mean an official has been convicted of breaking a law. The bad pols did it. We are at the point, though, where it is hard to say that the corruptions of government are only about the politicians.

Murtha may be right. We are all earmarkers now.

Here's another way of putting it: The U.S. budget is now history's biggest mountain of swag; it is uncountable goodie bags filled with tax revenue. Mr. Obama's swag mountain, the fiscal year 2010 "budget," is $3.59 trillion high (25% of total GDP of about $14 trillion). His $800 billion stimulus bill was another pile of public cash. We the people have concluded that if we don't use the Honorable John or Nancy or Ted in Congress to get our piece of it, someone else will get it.

For the longest time, we were able to believe that these corruptions were the inevitable but petty price of politics. But I agree with John Murtha. It isn't petty anymore. It isn't just about amusing "pet projects." The whole system has become an earmark. The politicians have been shaping the system so that more and more people have to buy in to the earmark philosophy -- we pay, they decide -- or get left out.

Barack Obama isn't a reformer. He's the president of Earmark Nation. We are about to enact the Obama federal health-insurance entitlement, which on top of all the other entitlements and their limitless liabilities will require pulling trillions of dollars more into the federal budget. Whatever nominal public good this is supposed to achieve, it means that they, these 535 pols, most of them gerrymandered for life, will decide in perpetuity the details of how to dole it out.

When this experiment called the United States began some 200 years ago, neither the "liberals" nor "conservatives" of that time imagined their successors would have such vast sway over the nation's income, or that U.S. politics would be mostly factions begging and fighting to have fragments of it disbursed back to them. The phrase "pay to play" would have disgusted them.

"If I'm corrupt, it's because I take care of my district."

John Murtha of Johnstown is the canary in the mine shaft. In politics, the canaries don't die. They adapt and learn to live with the toxic fumes of public spending on scales beyond morality or understanding. We are just about there.

10a)Target: Intel, and Competition: Team Obama adopts the European model on antitrust

The world is returning to the 1970s on most economic policies, so why not antitrust too? Judging by events this week, antitrust enforcement in the U.S. and Europe is in for a major comeback, whether or not consumers benefit.

Yesterday in Brussels, the EuropeaACAn Commission imposed a record antitrust fine of $1.45 billion on Intel for the heinous crime of discounting computer chips in its fierce and long-running competition with AMD. Meanwhile on Monday, President Obama's new antitrust chief, Christine Varney, issued a radical revision of the Department of Justice's own antitrust enforcement standards. Ms. Varney's ambition seems to be nothing less than bringing Europe's corporatist approach to competition policy to the U.S. To succeed, she will have to flout or overturn decades of Supreme Court precedent on the limits of U.S. antitrust law.

But Ms. Varney can be sure of a friendly ear in Brussels, which has never let go of the idea that competition is best when there isn't much of it. The Commission's attitude is on full display in the fining of Intel for allegedly abusing its dominant position in the market for computer processors. For years, Intel and AMD have been essentially the only game in town for computer CPUs. The Commission's complaint amounts to little more than a whinge that Intel won more of this business than the Commission would prefer.

This is couched in dark-sounding talk about Intel paying computer makers not to buy AMD chips. But remember there is only so much demand and there are only two major market players. So any order won by Intel by offering a discount or a rebate is, by definition, an order lost by AMD. And yet the Commission bizarrely claims that "millions of Europeans" have been harmed by this price war.

Intel has been able to sell enough chips cheaply enough to maintain an overall market share that has hovered between 75% and 80% for years. And those lower prices help drive down the price of a computer, which is good for consumers. A less competitive market for chips, or one in which Intel is barred from offering discounts to its biggest customers, would mean higher consumer prices. The Commission also suggests that Intel may have sold some chips below its cost, but Intel denies this and claims it can prove it if the Commission would deign to consider its evidence.

The Commission is, as ever, more focused on preserving competitor welfare above consumer welfare, and Ms. Varney at Justice seems to be promoting a similar approach. The American left likes to advertise itself as pro-consumer. But the curious reality about the left's view of antitrust in both Europe and America is that it is often used to assist big business by dampening competition. This corporatist notion seems to be that companies should compete, so long as no one really loses. Ms. Varney paid lip service to the dangers of protecting competitors when she criticized the National Industrial Recovery Act, ushered in by FDR during the Great Depression. That odious piece of industrial policy blessed price collusion between big firms in exchange for a commitment to keep people employed and share some of the collusive profits with labor.

But in her speech, Ms. Varney tries to cast this anticompetitive act as a form of deregulation. In fact, the NIRA was regulation of the worst sort, protecting competitors from competitive harm in the name of some greater good. True deregulation aims at greater competition, while European (and Rooseveltian) corporatism dampens it. This historical obfuscation allows Ms. Varney to argue that it would be good for competition to adopt something like Europe's "abuse of dominant position" standard in place of the consumer-harm test that currently prevails in the U.S.

Europe's Intel case makes the importance of these different tests very clear. By any reasonable application of a consumer-harm test, the antitrust claim that Intel is driving down prices -- and so making computers less expensive -- would be laughed out of U.S. court. The only harm here is to a competitor that can't match Intel's prices. And even at that, AMD isn't exactly going out of business. At times its market share for consumer desktop CPUs has been as high as 50%, and at its most successful the upper bound has been determined as much by AMD's own manufacturing capacity as by Intel's behavior.

When she announced the judgment against Intel Wednesday, European Competition Commissioner Neelie Kroes praised Ms. Varney's new approach to antitrust. And no wonder. Regulators love company, and European regulators in particular love it when their American counterparts help them hamstring the most efficient U.S. companies. Why President Obama should want to punish U.S. multinationals is harder to figure since his political success hangs on economic recovery and a revival in business profits and hiring. But perhaps we should conclude that this is merely one more example of the ways in which this Administration is seeking to remake American capitalism in the image of Continental Europe.