speck of dust

The real reason Spitzer was exposed

Hope and Change scam

Obama's Mercenary Position

Jeremy Scahill

http://www.thenation.com/doc/20080317/scahill


Obama campaign and Senate staffers characterize this as an inherited problem with no good alternatives. "We are in a situation where, because of bad planning and a series of disastrous policy choices by the Bush Administration, we're forced to rely on private security contractors," says the senior adviser. "What we're focused on at the moment is getting the legal architecture in place that will hold these guys accountable to the same standard that [applies to] enlisted US military personnel."

In Iraq right now, the number of private contractors is basically equal to the number of US troops. While Obama advisers say they plan to "have a serious look" at the role of contractors in Iraq, one adviser seemed to indicate that unarmed contractors would continue to operate at significant levels. "These contractors are not only providing private security functions like Blackwater. They're rebuilding schools, they are serving food, they're doing logistics, they're driving trucks, and the important question is, If you take those 100,000-plus contractors out of Iraq, what do you replace them with? Inevitably the answer is, You replace them with US military."

But, the senior adviser notes, "ideally we would have diplomatic security personnel, US government personnel, not subcontracted but US Bureau of Diplomatic Security agents providing security to all our ambassadors."

CONTINUED BELOW
Says another Obama adviser, "If we could start this whole war from the beginning, what would we have done versus what can we do now, now that we're in the middle of it? In an ideal world, we would not have these contractors, but that's not the world we operate in right now."

The State Department has only an estimated 1,450 diplomatic security agents worldwide who are actual government employees, and only thirty-six are deployed in Iraq. In contrast, Blackwater has nearly 1,000 operatives in Iraq alone, not to mention the hundreds more working for DynCorp and Triple Canopy. Moreover, the State Department says it could take years to identify prospective new agents, vet them, train them and deploy them. In short, this would be no small undertaking by a President Obama. As Ambassador Ryan Crocker said in late 2007, "There is simply no way at all that the State Department's Bureau of Diplomatic Security could ever have enough full-time personnel to staff the security function in Iraq. There is no alternative except through contracts."

Making diplomatic security a military operation would pose serious challenges as well. As the New York Times reported late last year, "the military does not have the trained personnel to take over the job." Even if the military trained a specialized force for executive protection and bodyguarding in Iraq, this arrangement would mean more US military convoys traveling inside Iraq, potentially placing them in deadly conflict with Iraqi civilians on a regular basis.

The private security industry knows well that it has become a central part of US policy in Iraq and Afghanistan. Extricating the firms from this position would require a major and aggressive undertaking with significant Congressional support, which is by no means guaranteed. In fact, Blackwater appears to see a silver lining in the prospect of US forces being withdrawn or reduced in Iraq. Joseph Schmitz, chief operating officer of Blackwater's parent company, The Prince Group, said, "There is a scenario where we could as a government, the United States, could pull back the military footprint, and there would then be more of a need for private contractors to go in." The Obama senior adviser called Schmitz's comment "an unfortunate characterization."

Illinois Democrat Jan Schakowsky, one of Congress's sharpest critics of the war contracting system, says of Schmitz's remark, "That's why some of us have been really careful about not just talking about a troop withdrawal but a contractor withdrawal as well." Obama, she says, should make it impossible for Schmitz and others "to think that Barack Obama would be creating new opportunities for Blackwater after our troops are withdrawn." The clearest way for him to do that would be to endorse legislation banning the use of Blackwater and other mercenary firms in Iraq. In November Schakowsky and Vermont Senator Bernie Sanders introduced the Stop Outsourcing Security (SOS) Act, which mandates that US personnel undertake all diplomatic security in Iraq within six months of enactment. The bill has twenty-three co-sponsors in the House and one--Sanders--in the Senate. Sanders said he'd "love" it if Obama and Clinton signed on. "If either of them came on board, we'd certainly see more Democratic support," says Sanders. Will Obama do that before November? "The answer is no, in all candor," says the senior Obama adviser. "Obviously it's a dynamic situation, and he'll continue to analyze it."

Schakowsky is pressing Obama to support the bill and says that if he becomes President she will urge him to "cancel" any remaining Blackwater contract in Iraq: "There's plenty of justification to say this company is trouble, and there's no point in continuing our contract with them."

The senior adviser said, "Senator Obama is concerned that Blackwater remains in Iraq, and he's concerned that they remain in Iraq and other countries totally unaccountable to US law and totally unaccountable to the law in the country in which they are operating." Which raises the question: If he's so concerned, why not throw his support behind a ban on the use of these forces in Iraq?



about
Jeremy Scahill

Jeremy Scahill, a Puffin Foundation Writing Fellow at The Nation Institute, is the author of the bestselling Blackwater: The Rise of the World's Most Powerful Mercenary Army, published by Nation Books. He is an award-winning investigative journalist and correspondent for the national radio and TV program Democracy Now!.

Chelsea

http://www.waynemadsenreport.com/articles/20080208_2

February 8-10, 2008 -- Chelsea Clinton takes higher profile in mother's campaign

During the Clinton presidency, first daughter Chelsea Clinton was the subject of repeated ugly attacks from the Republican attack machine, including Rush Limbaugh, John McCain, and National Review contributing editor John Derbyshire.

However, now that Chelsea Clinton, who is almost 28, has taken a leading part in her mother's presidential campaign, Chelsea Clinton's employment record is becoming an issue in the campaign.

Chelsea, who lives in the Manhattan west side chic neighborhood of Chelsea, worked for the management efficiency consulting firm McKinsey & Co. from 2003 to 2006, reportedly for a six-figure salary. McKinsey has been one of the worst nightmares for progressives and the labor movement around the world and throughout the United States.

Known as "the Firm," McKinsey maintains offices in North and South America, Asia, Africa, the Middle East, Europe, and Australia. McKinsey's clients are traditionally a well-kept secret.

McKinsey's past executives include US ambassador to Germany Richard Burt, also an adviser to the Carlyle Group and the founder of Diligence LLC, a company that profited handsomely from the Iraq occupation. Its past employees include Michael Hague, the head of the British Conservative Party from 1997 to 2001; and Bobby Jindal, the Republican Governor of Louisiana;

However, McKinsey's propensity to offer its clients streamlining recommendations has often resulted in massive lay-offs and the cutting of important activities, some of which are related to safety. The company places primary emphasis on shareholder value over customer service. With the bent towards outsourcing, this prioritization of profits over everything else has met with disaster by some companies. When McKinsey urged British Railtrack, formed after the state-owned British Rail was privatized, to maximize profits for shareholders by reducing investments in infrastructure, the firm cut back its rail improvement. The result was deadly train crashes at Southall in 1997, Ladbroke Grove in 1999, and Hatfield in 2000.

McKinsey was also hired by British Prime Minister Tony Blair to reorganize the Cabinet Office. The Financial Times quoted a senior civil servant who criticized the hiring of McKinsey. The officials said McKinsey are "people who come in and use PowerPoint to state the bleeding obvious."

McKinsey has also been criticized for recommending the auto insurance industry reject medical claims involving soft tissue injuries. The firm's work for the British National Health Service has also resulted in charges that critical care elements are being eliminated under the British health care system. Observers are concerned that a Hillary Clinton presidency will feature her daughter's old pals at McKinsey wielding cost cutting axes in crafting a health care program for the United States.

In 2006, Chelsea left McKinsey to take a job with Marc Lasry's Avenue Capital Group, a $12 billion hedge fund. Lasry, a financial donor to the Democrats and the Clintons, was a founder of Amroc, a "distressed stock broker." Amroc's partner included Keystone, Inc., an investment firm linked to the Robert M. Bass Group. Robert M. Bass is the billionaire son of Texas oil tycoon, Perry Richardson Bass. Robert M. Bass is a long time contributor to George W. Bush's political campaigns. His brother Ed was a Yale classmate of Bush and remains a close friend. Robert Bass is founder of Aerion Corp., a Pentagon contractor.

There was a time when Chelsea Clinton was off-limits in the political scheme of things. However, with recent revelations concerning her father's dodgy business deals with Kazakhstan dictator Nursultan Nazarbayev, Kazakhstan uranium mining deals for Clinton big mining Canadian pal Frank Giustra, and Bill Clinton's dubious Sustainable Growth Initiative, Chelsea's own dubious relationships with New York's most powerful hedge funds and Bush political allies raise further questions about all three Clintons' "ties that bind."

Immigration commentary

Immigrants Come Here Because Globalization Took Their Jobs Back There By Jim Hightower

Posted on February 7, 2008 by dandelionsalad

Dandelion Salad

By Jim Hightower
AlterNet.org
Hightower Lowdown
February 7, 2008

Seal-the-border hysteria is everywhere. Instead of blaming immigrants for America’s problems, let’s look at executives on both sides of the border.
The wailing in our country about the “invasion of immigrants” has been long and loud. As one complainant put it, “Few of their children in the country learn English …The signs in our streets have inscriptions in both languages … Unless the stream of the importation could be turned they will soon so outnumber us that all the advantages we have will not be able to preserve our language, and even our government will become precarious.”

That’s not some diatribe from one of today’s Republican presidential candidates. It’s the anxious cry of none other than Ben Franklin, deploring the wave of Germans pouring into the colony of Pennsylvania in the 1750s. Thus, anti-immigrant eruptions are older than the United States itself, and they’ve flared up periodically throughout our history, targeting the Irish, French, Italians, Chinese, and others. Even George W’s current project to wall off our border is not a new bit of nuttiness — around the time of the nation’s founding, John Jay, who later became the first chief justice of the Supreme Court, proposed “a wall of brass around the country for the exclusion of Catholics.”

Luckily for the development and enrichment of our country, these past public frenzies ultimately failed to exclude the teeming masses, and those uproars now appear through the telescope of time to have been some combination of ridiculous panic, political demagoguery and xenophobic ugliness. Still, this does not mean that the public’s anxiety and simmering anger about today’s massive influx of Mexicans coming illegally across our 2,000-mile shared border is illegitimate. However, most of what the politicians and pundits are saying about it is illegitimate.

Wedge issue

There is way too much xenophobia, racism and demagoguery at play around illegal immigration, but such crude sentiments are not what is bringing this problem to a national political boil. Polls show — as do conversations at any Chat & Chew Cafe in the country — that there is a deep and genuine alarm about the issue among the nonxenophobic, nonracist American majority. In particular, workaday families are fearful about what an endless flow of low-wage workers portends for their economic future, and they’re not getting good answers from Republicans, Democrats, corporate leaders or the media.

For the GOP candidates in this year’s presidential run, the contest is coming down to who can be the most nativist knucklehead. They accuse each other of not wanting to punish immigrant children enough, of not being absolutists on “English-only” proposals, of having coddled illegal entrants in the past with amnesty proposals and sanctuaries, and of not being hawkish enough on sealing off and militarizing the border.

The leader of the anti-immigrant Republican pack is Tom Tancredo, a Colorado congress-critter who based his ill-fated presidential campaign on immigrant bashing. This goober is so nasty he’d scare small children. His website screeched that immigrants are “pushing drugs, raping kids, destroying lives,” and his campaign slogan is a sledgehammer demand: “Deport those who don’t belong. Make sure they never come back.” As for illegal immigrants, Tom thinks that the term “illegal” is too soft, preferring to demonize immigrants as “aliens.” Tancredo doesn’t merely rant, he foams at the mouth, maniacally warning about waves of Mexican terrorists who are “coming to kill me and you and your children.” Accused of trying to turn America into a gated community, he exulted, “You bet!”

At least he’s taken a position, even if it’s un-American and loopy. Democratic leaders, on the other hand, have mostly tried to do a squishy shuffle, wanting to beef up law enforcement against illegal immigrants while also mouthing soothing words about the good work ethic of our friends south of the border and offering a bureaucratic rigmarole to allow some of the younger ones to gain permanent residency in our country. Worse, such corporate Democrats as Rep. Rahm Emanuel urge the party’s candidates either to adopt the Republican’s punitive message or simply to try ducking the issue.

Which brings us to the wall, both figuratively and literally. The fact that we are resorting to the construction of an enormous fence between two friendly nations admits to an abject failure by policy makers, who are so bereft of ideas, honesty, courage and morality that all they can do is to try walling off the problem.

We’ve had experience here in Texas with the futility of tall border fences. Molly Ivins reported a beer-induced incident that took place in 1983. Walling off Mexico had been proposed back then by the Reaganauts, and a test fence had been built way down in the Big Bend outpost of Terlingua. This little town also happened to be the site of a renowned chili cookoff that Molly helped judge, and it attracted a big crowd of impish, beer-drinking chiliheads.

There stood the barrier, 17 feet tall and topped with barbwire. It didn’t take many beers before the first-ever “Terlingua Memorial Over, Under, or Through the Mexican Fence Climbing Contest” was cooked up. Winning time: 30 seconds.

Yet here come the border sealers again. Bush & Co. (including Democrats who have allowed the funding) is putting up an initial $1.2 billion to start building this version of the wall, which is projected to cost up to $60 billion over the next 25 years to build and maintain. It’s a monster wall — two or three 40-foot-high rows of reinforced fencing that take a swath of land 150 feet wide and stretch for 700 miles.

The Mexican government and people are insulted and appalled by the wall; ranchers, mayors and families living on either side of the border hate it; environmentalists are aghast at its destructive impact on the ecology of the area. Still, it’s being built. Indeed, a 2005 federal act contained a little-noticed section authorizing Bush’s Homeland Security czar to suspend any laws that stand in the way of building the wall. Current czar Michael Chertoff has already used this unprecedented authority to waive 19 statutes, including the Endangered Species, Clean Water and National Historic Preservation Acts.

All this for something that will not work. As Gov. Janet Napolitano of Arizona put it, “Show me a 50-foot wall and I’ll show you a 51-foot ladder.” People have literally been dying to cross into the United States, and it’s not possible to build a wall tall enough to stop them. They will keep coming.

Why?

The question that policy makers have not faced honestly is this one: Why do these immigrants come? The answer is not that they are pulled by our jobs and government benefits, but that they are pushed by the abject poverty that their families face in Mexico. That might seem like a mere semantic difference, but it’s huge if you’re trying to develop a policy to stop the human flood across our border.

Although you never hear it mentioned in debates on the issue, you might start with this reality: Most Mexican people really would prefer to live in their own country. Can we all say, duh? Pedro Martin, who has seen most of the young men and women in his small village depart for El Norte, put it this way: “Up north, even though they pay more, you’re not necessarily living as well. You feel out of place. Here you can walk around the whole town, and it’s comfortable. Life is easier.”

Their family, language, culture, identity and happiness is Mexican — yet sheer economic survival requires so many of them to abandon the place they love.

Again, why? Because in the last 15 years, Mexico’s longstanding system of sustaining its huge population of poor citizens (including small self-sufficient farms, jobs in state-owned industries and subsidies for such essentials as tortillas) has been scuttled at the insistence of U.S. banks, corporations, government officials and “free market” ideologues. In the name of “modernizing” the Mexican economy, such giants as Citigroup, Wal-Mart, Tyson Foods and GE — in cahoots with the plutocrats and oligarchs of Mexico — have laid waste to that country’s grass-roots economy, destroying the already-meager livelihoods of millions.

The 1994 imposition of NAFTA was particularly devastating. Just as Bill Clinton and the corporate elites did here, Mexico’s ruling elites touted NAFTA as a magic elixir that would generate growth, create jobs, raise wages and eliminate the surge of Mexican migrants into the United States. They were horribly wrong:

• Economic growth in Mexico has been anemic since ‘94, and the benefits of any growth have gone overwhelmingly to the wealthiest families.
• Since NAFTA, Mexico has created less than a third of the millions of decent jobs it needs.
• Average factory wages in Mexico have dropped by more than 5 percent under NAFTA.
• Unemployment has jumped, and unskilled workers are paid only $5 a day.
• U.S. agribusiness corporations have more than doubled their shipment of subsidized crops into Mexico, busting the price that indigenous farmers got for their production and displacing some 2 million peasant farmers from their land.
• Huge agribusiness operations, many owned by U.S. investors, now control Mexican agricultural production and pay farmworkers under $2 an hour.
• Since NAFTA passed, there has been a flood of business bankruptcies and takeovers in Mexico as predatory U.S. chains have moved in. U.S. corporations now control 40 percent of the country’s formal jobs, with Wal-Mart reigning as the No. 1 employer.
• Nineteen million more Mexicans live in poverty today than when NAFTA was passed.

So, here’s the deal: Thanks to Mexico’s newly corporatized economy, wage earners there get poverty pay of $5 a day (about $1,600 a year), while a few hundred miles north, they might draw that much in an hour. What would you do?

The wrong debate

In our national imbroglio over Mexican immigration (yes, some illegal migrants come from elsewhere, but more than three-fourths are from Mexico), our “leaders” have set us up to look down at impoverished working people forced to leave their homeland and risk death in order to help their families escape poverty.

Instead of coming down on them, why not start looking up — up at the executive suites on both sides of the border. Up is where the power is. The moneyed elites in those suites are the profiteering few who have rigged all of our trade and labor policies to knock down workers, farmers and small businesses, not merely in Mexico but in our country as well.

In the United States, the middle class feels imperiled because … well, because it is imperiled. Politicians, economists and the richly paid pundits keep telling us that the American economy is robust and that people’s financial pessimism and anxieties are irrational. At the kitchen table level, however, folks know the difference between chicken salad and chicken manure. Yes, these are boom times for the luxury class, but the middle class is imploding. In a recent letter to the editor, a working stiff in California put it this way:

“We’ve replaced steaks with corn flakes; we can’t afford to get sick; our kids can’t afford health insurance; we hope that our 10-year-old van keeps running because we can’t afford a new one; our kids can’t buy a home because housing prices are exorbitant; our purchasing power continually regresses; and worst of all, the poverty and near-poverty classes are growing.”

It’s this economic fragility that anti-immigrant forces play on. But even if there were no illegal workers in our country — none — the fragility would remain, for poor Mexican laborers are not the ones who:

• Downsized and offshored our middle-class jobs.
• Perverted our bankruptcy laws to let corporations abrogate their union contracts.
• Stopped enforcement of America’s wage and hour laws.
• Perverted the National Labor Relations Board into an anti-worker tool for corporations.
• Illegally reclassified millions of employees as “independent contractors,” leaving them with no benefits or labor rights.
• Subverted the right of workers to organize.
• Turned a blind eye to the re-emergence in America of sweatshops and child labor in everything from the clothing industry to Wal-Mart.
• Made good healthcare a luxury item.
• Let rich campaign donors take over both political parties.
• Passed by hook and crook a continuing series of global-trade scams to enrich the few and knock down the many.

Powerless immigrants didn’t do these things to us. The richest, most-powerful, best-connected corporate interests did them. Judy Ancel, director of the Institute for Labor Studies at the University of Missouri, offers this example of Iowa Beef Processors (IBP), the largest meatpacker in the United States, now owned by the multibillion-dollar conglomerate Tyson Foods:

Until the late 1970s, meatpacking was a high-wage industry, with highly skilled workers in charge. Factories were in union cities, union contracts provided good wages and benefits, and unions set professional standards for everything from worker training to safety conditions. Then IBP’s executives transformed this beneficial model into today’s profiteering system. The factories moved to nonunion cities and rural areas, and lower-skilled workers were hired to do repetitive cuts on speeded-up assembly lines. With Reagan as president, meat-industry lobbyists were able to emasculate labor laws, and unions lost their influence over the workplace, which became much less rewarding and more dangerous. IBP began intensive recruiting of Mexican workers (legal or not) to do what had become very nasty work. In only 20 years, meatpacking wages dropped by roughly half, the union was ousted, and the rate of workplace injury became one of the highest of any industry (more than a fourth of meatpacking workers now suffer “accidents”).

The fix

Immigration reform cannot be separated from labor and trade reform. We can’t fix the former without dealing with the other two. We must stop the exploitative NAFTAfication of such aspiring economies as Mexico and instead develop genuine grass-roots investment policies that give people there an ability to remain in their homeland. Then we must enforce our own labor laws — from wage and hour rules to the NLRB — so as to empower American workers to enforce their own rights.

Eliminating the need to migrate from Mexico and rebuilding the middle-class ladder, here is an “immigration policy” that will work. But it requires us to go right at the corporate kleptocracy that now owns Washington and controls the debate.

We must challenge Democrats, especially, to broaden the debate and to recognize that they must choose sides — to be for workers or for more trade imperialism. Right now, the Democratic leadership is siding with imperialism and exacerbating the economic causes of Latino migration. For example, just last month, Speaker Nancy Pelosi engineered a vote to extend NAFTA to Peru, a corporate favor that could be called the Tom-Rahm Bipartisan Axis of Immigration Stupidity, for it drew enthusiastic support from both Tom Tancredo and Rahm Emanuel.

America’s immigration problem is not down on the border, it’s in Washington and on Wall Street.
From “The Hightower Lowdown,” edited by Jim Hightower and Phillip Frazer, January 2008. Jim Hightower is a national radio commentator, writer, public speaker and author of the new book Swim Against the Current: Even a Dead Fish Can Go With the Flow. (Wiley, March 2008)

Mitt's farewell

leon endorses Barack

Bush spending plan for Fortress USA

Bush Unveils $3.1 Trillion Spending Plan
Feb 4 01:24 PM US/Eastern
By MARTIN CRUTSINGER
AP Economics Writer


WASHINGTON (AP) - President Bush sent the nation's first-ever $3 trillion budget proposal to Congress on Monday, contending that the spending blueprint will fulfill his chief responsibility to keep America safe.

The $3.1 trillion proposed budget projects sizable increases in national security but forces the rest of government to pinch pennies. It seeks $196 billion in savings over five years in the government's giant health care programs—Medicare and Medicaid.

But even with those restraints, the budget projects the deficits will soar to near-record levels of $410 billion this year and $407 billion in 2009, driven higher in part by efforts to revive the sagging economy with a $145 billion stimulus package.

Bush called the document, which protects his signature tax cuts, "a good, solid budget" But Democrats, and even a top Republican, attacked the plan for using budgetary gimmicks to claim the budget can return to balance in 2012, three years after Bush leaves office.

Democrats called Bush's final spending plan a continuation of this administration's failed policies which wiped out a projected 10-year surplus of $5.6 trillion and replaced it with a record buildup in debt.

"Today's budget bears all the hallmarks of the Bush legacy—it leads to more deficits, more debt, more tax cuts, more cutbacks in critical services," said House Budget Committee Chairman John Spratt, D-S.C.

For his last budget, Bush, as a money-saving measure, stopped the practice of providing 3,000 paper copies of the budget to members of Congress and the media, instead posting the entire document online at http://www.budget.gov. Democrats joked that Bush cut back on the printed copies because he ran out of red ink.

"This budget is fiscally irresponsible and highly deceptive, hiding the costs of the war in Iraq while increasing the skyrocketing debt,' said Senate Majority Leader Harry Reid, D-Nev.

"The president proposes more of the same failed policies he has embraced throughout his time in office—more deficit-financed war spending, more deficit-financed tax cuts tilted to benefit the wealthiest and more borrowing from foreign nations like China and Japan," said Senate Budget Committee Chairman Kent Conrad, D-N.D.

Bush defended his record, saying it supported a strong defense and, if his policies are followed, will produce a budget surplus of $48 billion in 2012.

"Two key principles guided the development of my budget—keeping America safe and ensuring our continued prosperity," Bush said in his budget message to Congress.

Reviewing the budget with his Cabinet, Bush said it would keep the economy growing and protect the U.S. militarily. He called it "innovative" because it was dispatched to Congress electronically.

Bush's final full budget is for the 2009 fiscal year, which begins on Oct. 1. It proposes spending $3.1 trillion, up 6 percent from projected spending of $2.9 trillion in the current budget year.

Part of the deficit increase this year and next reflects the cost of a $145 billion stimulus package of tax refunds for individuals and tax cuts for business investment that Bush is urging Congress to pass quickly to try to combat a threatened recession.

White House budget director Jim Nussle, briefing reporters on the spending plan, said that the quick bipartisan agreement reached on the stimulus package in the House showed what could happen when Democrats wanted to work with the White House to get things done. The stimulus plan has yet to clear the Senate.

Democrats said the forecast of a budget surplus in 2012 was based on flawed math that only included $70 billion for the wars in Iraq and Afghanistan in 2009 and no money after that. It also failed to include any provisions after this year for keeping the alternative minimum tax, originally aimed at the wealthy, from ensnaring millions of middle-class taxpayers. The Congressional Budget Office estimates that fixing the AMT in 2012 would cost $118 billion, more than double the surplus Bush is projecting for that year.

White House press secretary Dana Perino told reporters that the war effort in 2009 would "certainly" cost more than the $70 billion included in the budget.

Even some Republicans faulted Bush's budget sleight of hand to project a balanced budget in 2012.

"They've obviously played an inordinate number of games to try to make it look better," Sen. Judd Gregg, the top Republican on the Budget Committee, said in an interview with The Associated Press.

"Let's face it. This budget is done with the understanding that nobody's going to be taking a long, hard look at it," said Gregg, R- N.H.

Bush's spending blueprint sets the stage for what will probably be epic battles in the president's last year in office, as both parties seek to gain advantages with voters heading into the November elections. Some have suggested that Democrats, unable to override Bush's expected vetoes, might choose to keep the government operating with a stopgap funding bill in hopes that a Democrat more amenable to their priorities will be elected in November.

The 6 percent overall increase in spending for 2009 reflects a continued surge in spending on the government's huge benefit programs for the elderly—Social Security and Medicare, even with the projected five-year savings of $196 billion over five years. Those savings are achieved by freezing payments to hospitals and other health care providers. A much-smaller effort by Bush in this area last year went nowhere in Congress.

While Bush projects that total security funding in the areas of the budget controlled by annual appropriations will go up by 8.2 percent, he projects only a 0.3 percent increase in discretionary spending for the rest of government.

To achieve such a small boost, Bush would hold hundreds of programs well below what is needed to keep up with inflation. He also seeks to eliminate or sharply slash 151 programs he considers unnecessary.

Nussle said that Congress had agreed to eliminate 29 of 141 programs Bush targeted last year, which he said was a good start.

This year, the largest number of program terminations—47—are in education including elimination of programs to encourage arts in schools, bring low-income students on trips to Washington and provide mental health services.


Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Rove Passes Up Commencement Speech at Choate After the Students Object

By THOMAS KAPLAN

Published: January 29, 2008

WALLINGFORD, Conn. — When 17-year-old Alessio Manti heard that Karl Rove, the former chief political adviser to President Bush, would be delivering the commencement address this spring to his class at Choate Rosemary Hall — the elite boarding school that produced such liberal giants as John F. Kennedy and Adlai Stevenson — he was shocked.

“I thought it was a joke,” Mr. Manti said. “Commencement is not the place for him.”

He was not alone. Although Mr. Rove played a major role in helping President Bush capture two terms in the White House, he could not gain the support of the senior class here. With students threatening to walk out on graduation, the school announced on Monday that Mr. Rove would not speak at commencement.

Instead, he has accepted an invitation to speak on campus next month, said the school’s headmaster, Edward J. Shanahan. “He was more than understanding,” Dr. Shanahan wrote in an e-mail message to students. “He was gracious and generous in his thinking about you and ‘your day.’ ”

In a telephone interview on Monday, Dr. Shanahan emphasized that he never rescinded Mr. Rove’s invitation and would not have done so even if Mr. Rove were not willing to reschedule. Dr. Shanahan will take Mr. Rove’s place at graduation.

The change caps a monthlong saga at Choate, where Mr. Rove was not the first choice as commencement speaker. School officials turned to him after trying to book Senator John W. Warner, Republican of Virginia.

At a meeting last week, a clear majority of the graduating class of about 230 said it opposed Mr. Rove’s invitation, students who were at the meeting said.

In an editorial titled “Rove in ’08: We Think Not,” the campus newspaper, The News, urged the school to withdraw the invitation.

“Faculty members approached me and said, ‘We really need you to do something,’ ” the editor of the paper, Elliott August, said in an interview. “People around our community were really heated about this.”

Scores of students banded together on the social networking Web site Facebook to protest Mr. Rove’s appearance. On Choate’s 450-acre campus, dotted with Georgian-style dormitories, students whispered about walking out on graduation, turning their chairs around when Mr. Rove took the podium or wearing T-shirts with a message protesting the speech.

“I myself thought of not going,” said Jack Fallon, 18, a senior from Santa Rosa, Calif.

Other students said they were ready to explore other options, like bringing the comedian Stephen Colbert to campus to speak at an alternative commencement.

Politics at Choate have been known to trend decidedly blue. In a mock election in 2004, Senator John Kerry was the favorite of students over President Bush by 22 percentage points. Among the faculty, Mr. Kerry got 86 percent of the vote.

“It wasn’t really about that he was a Republican,” said Jillian Ruben, the president of the Choate Young Democrats, said of Mr. Rove. “It was that I feel that he goes against all the things that Choate has spent the last four years teaching me.”

Until Monday, it appeared that the school was not prepared to replace Mr. Rove. In the Sunday editions of The Hartford Courant, Dr. Shanahan wrote an article for the op-ed page titled “Rove Deserves to Be Heard.”

“It is my hope that, even amid the swarm of controversy that surrounds him, Mr. Rove will identify for our students a perspective that will encourage them to engage politics more, and to put their shoulders to the wheels of leadership our country so desperately needs,” the headmaster wrote.

But on Monday, Dr. Shanahan said that after meeting with students last week and reading e-mail messages from them, it was clear that students “wanted to have an opportunity to engage him about his public life and not just hear him give them a parting message.”

Students were also worried that the graduation might be interrupted by outsiders, he said. Dr. Shanahan said he relayed their concerns to Mr. Rove over the weekend and asked, “What about coming up here at another time?”

“He said, ‘Sure,’ ” Dr. Shanahan said.

In a statement released by the school, Mr. Rove said he was looking forward to visiting Choate next month.

“I would not want 12 minutes of remarks to be used as an excuse by a small group to mar what should be a wonderful day of celebration for the members of the 2008 graduating class and their families,” he said.

Mr. Rove was one of President Bush’s longest-serving and closest aides — and also one of the most controversial — when he left the White House in August. Students said that among their issues with Mr. Rove were his aggressive campaign tactics.

Mr. Manti, one of the students organizing opposition to Mr. Rove, said on Monday that he was “extremely appreciative” that the school changed course.

But not everyone felt that way.

“No one really gave him a chance,” said Christophe Lirola, 17, a senior who is a member of the Choate Young Republicans.

But he found solace in what he called disappointing news.

“I do think it says a lot about Karl Rove,” he concluded, “the fact that he’s still willing to come to campus.”

720 million dollar question

end of the world

Why the Debt Crisis Is Now the Greatest Threat to the American Republic

Going Bankrupt

Why the Debt Crisis Is Now the Greatest Threat to the American Republic

By Chalmers Johnson

The military adventurers of the Bush administration have much in common with the corporate leaders of the defunct energy company Enron. Both groups of men thought that they were the "smartest guys in the room," the title of Alex Gibney's prize-winning film on what went wrong at Enron. The neoconservatives in the White House and the Pentagon outsmarted themselves. They failed even to address the problem of how to finance their schemes of imperialist wars and global domination.

As a result, going into 2008, the United States finds itself in the anomalous position of being unable to pay for its own elevated living standards or its wasteful, overly large military establishment. Its government no longer even attempts to reduce the ruinous expenses of maintaining huge standing armies, replacing the equipment that seven years of wars have destroyed or worn out, or preparing for a war in outer space against unknown adversaries. Instead, the Bush administration puts off these costs for future generations to pay -- or repudiate. This utter fiscal irresponsibility has been disguised through many manipulative financial schemes (such as causing poorer countries to lend us unprecedented sums of money), but the time of reckoning is fast approaching.

There are three broad aspects to our debt crisis. First, in the current fiscal year (2008) we are spending insane amounts of money on "defense" projects that bear no relationship to the national security of the United States. Simultaneously, we are keeping the income tax burdens on the richest segments of the American population at strikingly low levels.

Second, we continue to believe that we can compensate for the accelerating erosion of our manufacturing base and our loss of jobs to foreign countries through massive military expenditures -- so-called "military Keynesianism," which I discuss in detail in my book Nemesis: The Last Days of the American Republic. By military Keynesianism, I mean the mistaken belief that public policies focused on frequent wars, huge expenditures on weapons and munitions, and large standing armies can indefinitely sustain a wealthy capitalist economy. The opposite is actually true.

Third, in our devotion to militarism (despite our limited resources), we are failing to invest in our social infrastructure and other requirements for the long-term health of our country. These are what economists call "opportunity costs," things not done because we spent our money on something else. Our public education system has deteriorated alarmingly. We have failed to provide health care to all our citizens and neglected our responsibilities as the world's number one polluter. Most important, we have lost our competitiveness as a manufacturer for civilian needs -- an infinitely more efficient use of scarce resources than arms manufacturing. Let me discuss each of these.

The Current Fiscal Disaster

It is virtually impossible to overstate the profligacy of what our government spends on the military. The Department of Defense's planned expenditures for fiscal year 2008 are larger than all other nations' military budgets combined. The supplementary budget to pay for the current wars in Iraq and Afghanistan, not part of the official defense budget, is itself larger than the combined military budgets of Russia and China. Defense-related spending for fiscal 2008 will exceed $1 trillion for the first time in history. The United States has become the largest single salesman of arms and munitions to other nations on Earth. Leaving out of account President Bush's two on-going wars, defense spending has doubled since the mid-1990s. The defense budget for fiscal 2008 is the largest since World War II.

Before we try to break down and analyze this gargantuan sum, there is one important caveat. Figures on defense spending are notoriously unreliable. The numbers released by the Congressional Reference Service and the Congressional Budget Office do not agree with each other. Robert Higgs, senior fellow for political economy at the Independent Institute, says: "A well-founded rule of thumb is to take the Pentagon's (always well publicized) basic budget total and double it." Even a cursory reading of newspaper articles about the Department of Defense will turn up major differences in statistics about its expenses. Some 30-40% of the defense budget is "black," meaning that these sections contain hidden expenditures for classified projects. There is no possible way to know what they include or whether their total amounts are accurate.

There are many reasons for this budgetary sleight-of-hand -- including a desire for secrecy on the part of the president, the secretary of defense, and the military-industrial complex -- but the chief one is that members of Congress, who profit enormously from defense jobs and pork-barrel projects in their districts, have a political interest in supporting the Department of Defense. In 1996, in an attempt to bring accounting standards within the executive branch somewhat closer to those of the civilian economy, Congress passed the Federal Financial Management Improvement Act. It required all federal agencies to hire outside auditors to review their books and release the results to the public. Neither the Department of Defense, nor the Department of Homeland Security has ever complied. Congress has complained, but not penalized either department for ignoring the law. The result is that all numbers released by the Pentagon should be regarded as suspect.

In discussing the fiscal 2008 defense budget, as released to the press on February 7, 2007, I have been guided by two experienced and reliable analysts: William D. Hartung of the New America Foundation's Arms and Security Initiative and Fred Kaplan, defense correspondent for Slate.org. They agree that the Department of Defense requested $481.4 billion for salaries, operations (except in Iraq and Afghanistan), and equipment. They also agree on a figure of $141.7 billion for the "supplemental" budget to fight the "global war on terrorism" -- that is, the two on-going wars that the general public may think are actually covered by the basic Pentagon budget. The Department of Defense also asked for an extra $93.4 billion to pay for hitherto unmentioned war costs in the remainder of 2007 and, most creatively, an additional "allowance" (a new term in defense budget documents) of $50 billion to be charged to fiscal year 2009. This comes to a total spending request by the Department of Defense of $766.5 billion.

But there is much more. In an attempt to disguise the true size of the American military empire, the government has long hidden major military-related expenditures in departments other than Defense. For example, $23.4 billion for the Department of Energy goes toward developing and maintaining nuclear warheads; and $25.3 billion in the Department of State budget is spent on foreign military assistance (primarily for Israel, Saudi Arabia, Bahrain, Kuwait, Oman, Qatar, the United Arab Republic, Egypt, and Pakistan). Another $1.03 billion outside the official Department of Defense budget is now needed for recruitment and reenlistment incentives for the overstretched U.S. military itself, up from a mere $174 million in 2003, the year the war in Iraq began. The Department of Veterans Affairs currently gets at least $75.7 billion, 50% of which goes for the long-term care of the grievously injured among the at least 28,870 soldiers so far wounded in Iraq and another 1,708 in Afghanistan. The amount is universally derided as inadequate. Another $46.4 billion goes to the Department of Homeland Security.

Missing as well from this compilation is $1.9 billion to the Department of Justice for the paramilitary activities of the FBI; $38.5 billion to the Department of the Treasury for the Military Retirement Fund; $7.6 billion for the military-related activities of the National Aeronautics and Space Administration; and well over $200 billion in interest for past debt-financed defense outlays. This brings U.S. spending for its military establishment during the current fiscal year (2008), conservatively calculated, to at least $1.1 trillion.

Military Keynesianism

Such expenditures are not only morally obscene, they are fiscally unsustainable. Many neoconservatives and poorly informed patriotic Americans believe that, even though our defense budget is huge, we can afford it because we are the richest country on Earth. Unfortunately, that statement is no longer true. The world's richest political entity, according to the CIA's "World Factbook," is the European Union. The EU's 2006 GDP (gross domestic product -- all goods and services produced domestically) was estimated to be slightly larger than that of the U.S. However, China's 2006 GDP was only slightly smaller than that of the U.S., and Japan was the world's fourth richest nation.

A more telling comparison that reveals just how much worse we're doing can be found among the "current accounts" of various nations. The current account measures the net trade surplus or deficit of a country plus cross-border payments of interest, royalties, dividends, capital gains, foreign aid, and other income. For example, in order for Japan to manufacture anything, it must import all required raw materials. Even after this incredible expense is met, it still has an $88 billion per year trade surplus with the United States and enjoys the world's second highest current account balance. (China is number one.) The United States, by contrast, is number 163 -- dead last on the list, worse than countries like Australia and the United Kingdom that also have large trade deficits. Its 2006 current account deficit was $811.5 billion; second worst was Spain at $106.4 billion. This is what is unsustainable.

It's not just that our tastes for foreign goods, including imported oil, vastly exceed our ability to pay for them. We are financing them through massive borrowing. On November 7, 2007, the U.S. Treasury announced that the national debt had breached $9 trillion for the first time ever. This was just five weeks after Congress raised the so-called debt ceiling to $9.815 trillion. If you begin in 1789, at the moment the Constitution became the supreme law of the land, the debt accumulated by the federal government did not top $1 trillion until 1981. When George Bush became president in January 2001, it stood at approximately $5.7 trillion. Since then, it has increased by 45%. This huge debt can be largely explained by our defense expenditures in comparison with the rest of the world.

The world's top 10 military spenders and the approximate amounts each country currently budgets for its military establishment are:

1. United States (FY08 budget), $623 billion

2. China (2004), $65 billion

3. Russia, $50 billion

4. France (2005), $45 billion

5. Japan (2007), $41.75 billion


6. Germany (2003), $35.1 billion

7. Italy (2003), $28.2 billion

8. South Korea (2003), $21.1 billion

9. India (2005 est.), $19 billion

10. Saudi Arabia (2005 est.), $18 billion

World total military expenditures (2004 est.), $1,100 billion

World total (minus the United States), $500 billion

Our excessive military expenditures did not occur over just a few short years or simply because of the Bush administration's policies. They have been going on for a very long time in accordance with a superficially plausible ideology and have now become entrenched in our democratic political system where they are starting to wreak havoc. This ideology I call "military Keynesianism" -- the determination to maintain a permanent war economy and to treat military output as an ordinary economic product, even though it makes no contribution to either production or consumption.

This ideology goes back to the first years of the Cold War. During the late 1940s, the U.S. was haunted by economic anxieties. The Great Depression of the 1930s had been overcome only by the war production boom of World War II. With peace and demobilization, there was a pervasive fear that the Depression would return. During 1949, alarmed by the Soviet Union's detonation of an atomic bomb, the looming communist victory in the Chinese civil war, a domestic recession, and the lowering of the Iron Curtain around the USSR's European satellites, the U.S. sought to draft basic strategy for the emerging cold war. The result was the militaristic National Security Council Report 68 (NSC-68) drafted under the supervision of Paul Nitze, then head of the Policy Planning Staff in the State Department. Dated April 14, 1950, and signed by President Harry S. Truman on September 30, 1950, it laid out the basic public economic policies that the United States pursues to the present day.

In its conclusions, NSC-68 asserted: "One of the most significant lessons of our World War II experience was that the American economy, when it operates at a level approaching full efficiency, can provide enormous resources for purposes other than civilian consumption while simultaneously providing a high standard of living."

With this understanding, American strategists began to build up a massive munitions industry, both to counter the military might of the Soviet Union (which they consistently overstated) and also to maintain full employment as well as ward off a possible return of the Depression. The result was that, under Pentagon leadership, entire new industries were created to manufacture large aircraft, nuclear-powered submarines, nuclear warheads, intercontinental ballistic missiles, and surveillance and communications satellites. This led to what President Eisenhower warned against in his farewell address of February 6, 1961: "The conjunction of an immense military establishment and a large arms industry is new in the American experience" -- that is, the military-industrial complex.

By 1990, the value of the weapons, equipment, and factories devoted to the Department of Defense was 83% of the value of all plants and equipment in American manufacturing. From 1947 to 1990, the combined U.S. military budgets amounted to $8.7 trillion. Even though the Soviet Union no longer exists, U.S. reliance on military Keynesianism has, if anything, ratcheted up, thanks to the massive vested interests that have become entrenched around the military establishment. Over time, a commitment to both guns and butter has proven an unstable configuration. Military industries crowd out the civilian economy and lead to severe economic weaknesses. Devotion to military Keynesianism is, in fact, a form of slow economic suicide.

On May 1, 2007, the Center for Economic and Policy Research of Washington, D.C., released a study prepared by the global forecasting company Global Insight on the long-term economic impact of increased military spending. Guided by economist Dean Baker, this research showed that, after an initial demand stimulus, by about the sixth year the effect of increased military spending turns negative. Needless to say, the U.S. economy has had to cope with growing defense spending for more than 60 years. He found that, after 10 years of higher defense spending, there would be 464,000 fewer jobs than in a baseline scenario that involved lower defense spending.

Baker concluded:

.."It is often believed that wars and military spending increases are good for the economy. In fact, most economic models show that military spending diverts resources from productive uses, such as consumption and investment, and ultimately slows economic growth and reduces employment."..

These are only some of the many deleterious effects of military Keynesianism.

Hollowing Out the American Economy

It was believed that the U.S. could afford both a massive military establishment and a high standard of living, and that it needed both to maintain full employment. But it did not work out that way. By the 1960s, it was becoming apparent that turning over the nation's largest manufacturing enterprises to the Department of Defense and producing goods without any investment or consumption value was starting to crowd out civilian economic activities. The historian Thomas E. Woods, Jr., observes that, during the 1950s and 1960s, between one-third and two-thirds of all American research talent was siphoned off into the military sector. It is, of course, impossible to know what innovations never appeared as a result of this diversion of resources and brainpower into the service of the military, but it was during the 1960s that we first began to notice Japan was outpacing us in the design and quality of a range of consumer goods, including household electronics and automobiles.

Nuclear weapons furnish a striking illustration of these anomalies. Between the 1940s and 1996, the United States spent at least $5.8 trillion on the development, testing, and construction of nuclear bombs. By 1967, the peak year of its nuclear stockpile, the United States possessed some 32,500 deliverable atomic and hydrogen bombs, none of which, thankfully, was ever used. They perfectly illustrate the Keynesian principle that the government can provide make-work jobs to keep people employed. Nuclear weapons were not just America's secret weapon, but also its secret economic weapon. As of 2006, we still had 9,960 of them. There is today no sane use for them, while the trillions spent on them could have been used to solve the problems of social security and health care, quality education and access to higher education for all, not to speak of the retention of highly skilled jobs within the American economy.

The pioneer in analyzing what has been lost as a result of military Keynesianism was the late Seymour Melman (1917-2004), a professor of industrial engineering and operations research at Columbia University. His 1970 book, Pentagon Capitalism: The Political Economy of War, was a prescient analysis of the unintended consequences of the American preoccupation with its armed forces and their weaponry since the onset of the Cold War. Melman wrote (pp. 2-3):

.."From 1946 to 1969, the United States government spent over $1,000 billion on the military, more than half of this under the Kennedy and Johnson administrations -- the period during which the [Pentagon-dominated] state management was established as a formal institution. This sum of staggering size (try to visualize a billion of something) does not express the cost of the military establishment to the nation as a whole. The true cost is measured by what has been foregone, by the accumulated deterioration in many facets of life by the inability to alleviate human wretchedness of long duration."..

In an important exegesis on Melman's relevance to the current American economic situation, Thomas Woods writes:

.."According to the U.S. Department of Defense, during the four decades from 1947 through 1987 it used (in 1982 dollars) $7.62 trillion in capital resources. In 1985, the Department of Commerce estimated the value of the nation's plant and equipment, and infrastructure, at just over $7.29 trillion. In other words, the amount spent over that period could have doubled the American capital stock or modernized and replaced its existing stock."..

The fact that we did not modernize or replace our capital assets is one of the main reasons why, by the turn of the twenty-first century, our manufacturing base had all but evaporated. Machine tools -- an industry on which Melman was an authority -- are a particularly important symptom. In November 1968, a five-year inventory disclosed (p. 186) "that 64 percent of the metalworking machine tools used in U.S. industry were ten years old or older. The age of this industrial equipment (drills, lathes, etc.) marks the United States' machine tool stock as the oldest among all major industrial nations, and it marks the continuation of a deterioration process that began with the end of the Second World War. This deterioration at the base of the industrial system certifies to the continuous debilitating and depleting effect that the military use of capital and research and development talent has had on American industry."

Nothing has been done in the period since 1968 to reverse these trends and it shows today in our massive imports of equipment -- from medical machines like proton accelerators for radiological therapy (made primarily in Belgium, Germany, and Japan) to cars and trucks.

Our short tenure as the world's "lone superpower" has come to an end. As Harvard economics professor Benjamin Friedman has written:

.."Again and again it has always been the world's leading lending country that has been the premier country in terms of political influence, diplomatic influence, and cultural influence. It's no accident that we took over the role from the British at the same time that we took over� the job of being the world's leading lending country. Today we are no longer the world's leading lending country. In fact we are now the world's biggest debtor country, and we are continuing to wield influence on the basis of military prowess alone."..

Some of the damage done can never be rectified. There are, however, some steps that this country urgently needs to take. These include reversing Bush's 2001 and 2003 tax cuts for the wealthy, beginning to liquidate our global empire of over 800 military bases, cutting from the defense budget all projects that bear no relationship to the national security of the United States, and ceasing to use the defense budget as a Keynesian jobs program. If we do these things we have a chance of squeaking by. If we don't, we face probable national insolvency and a long depression.

Chalmers Johnson is the author of Nemesis: The Last Days of the American Republic, just published in paperback. It is the final volume of his Blowback Trilogy, which also includes Blowback (2000) and The Sorrows of Empire (2004).

[Note: For those interested, click here to view a clip from a new film, "Chalmers Johnson on American Hegemony," in Cinema Libre Studios' Speaking Freely series in which he discusses "military Keynesianism" and imperial bankruptcy. For sources on global military spending, please see: (1) Global Security Organization, "World Wide Military Expenditures" as well as Glenn Greenwald, "The bipartisan consensus on U.S. military spending"; (2) Stockholm International Peace Research Institute, "Report: China biggest Asian military spender."]..

Spitzer State of State Press Release 1/16/08

GOVERNOR SPITZER DELIVERS FIRST STATE OF UPSTATE ADDRESS
$1 Billion Upstate Revitalization Fund to Provide Infusion of Investment to Upstate Regions

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Governor Eliot Spitzer today delivered the first State of Upstate address at Buffalo State College. In his remarks, he laid out his vision for addressing the unique economic challenges facing Upstate New York by promoting an agenda to advance economic growth, investment and opportunity. The Governor called on all New Yorkers to recognize the need to reverse Upstate's decline if the entire state is to prosper and remain globally competitive.

The Governor detailed plans for a $1 billion Upstate Revitalization Fund, the centerpiece of this year's Upstate revitalization efforts. The fund represents a massive and strategic infusion of economic development capital, including more dollars to improve infrastructure, expand regionally-specific "City-by-City" economic development plans, establish a housing and community renewal fund, stimulate the agribusiness industry, achieve universal broadband access, improve parks, and expand international marketing. The fund will help solidify New York as the best place to live, work, raise a family and run a business

"We are One New York, and we rise and fall together," said Governor Spitzer. "When part of our State is struggling, it affects all of us. As families leave the State, our families and communities suffer. The truth is that we will never grow again; we will never prosper again; we will never become a beacon of hope and opportunity again if part of our state is thriving and another part is falling behind. So we must come together and channel all of the passion, energy and determination that is within us toward one goal: restoring growth and prosperity to Upstate New York."

The governor also articulated an agenda to improve the state's economy by investing in higher education, to draw business to our state. The administration plans to strengthen the State University of New York system by creating a $4 billion endowment, hiring 2,000 new professors, and establishing an Innovation Fund for cutting-edge applied research. A key element of the administration's Upstate revitalization plan will be improving links between SUNY campuses and local employers to promote job growth - a model that has worked successfully in many areas of the state.

The Governor delivered his State of Upstate speech a week after his annual State of the State address in which he set out a blueprint for the state to embrace economic growth by investing in education from pre-kindergarten through college, lowering taxes and energy costs, controlling runaway healthcare spending, and creating communities that are more livable. The state faces a projected $4.3 billion deficit, but even in the face of economic uncertainty the Governor has said it is important, now, more than ever, to invest to stimulate long-term growth.

Last year, the administration began to combat what the Governor called "the perfect storm of unaffordability" by reducing workers compensation rates an average of 20 percent, lowering corporate tax rates, and relieving local property taxes by providing rebates to middle-class New Yorkers - the homeowners who need it most. Building on the foundation of growth the administration laid last year, Governor Spitzer spoke of the need to continue to make Upstate more competitive by lowering the cost of doing business, and retooling the State government to zero in on Upstate's unique economic challenges. Governor Spitzer also reviewed last year's progress on the "City by City" tour, which broke gridlock on regionally and locally specific projects to build the infrastructure for economic growth.

"If we summon the will to work together to achieve the reforms and make the investments I will lay out today—we can overcome this storm and return growth and prosperity to Upstate New York," said Governor Spitzer. "We can make Upstate open for business; we can attract young people and keep them here; and we can truly become the best place in the world to live, work, raise a family and start a business."

The $1 billion Upstate Revitalization Fund includes:

• $350 million Regional Blueprint Fund

Designed to address infrastructure needs of communities across the state, the $350 million Regional Blueprint fund will provide capital for the construction and enhancement of development-ready sites and industrial parks; provide small business loans for machinery, equipment, real estate, and other needs; and fund programs, tools and facilities needed to link idea creation and job creation.

To incorporate local input, Regional Blueprint Meetings were convened in every Upstate region last year. These meetings featured top local economic development consultants and business leaders, who know their economies best, but whose views were rarely engaged in the past.

Part of the Regional Blueprint Fund will be a $10 million Venture Capital Fund—a pilot program to provide seed capital for small companies that have the potential to expand into major employers. Funds will provide an aggressive marketing campaign to encourage Canadian companies to relocate and include an international marketing office within Upstate ESDC.

• New Round of City by City Plans

Last year, Governor Spitzer implemented a "City by City" strategy to tailor economic development investments to fit local needs in order to jumpstart local economies. The $1 billion Fund will include dollars for a new round of City by City plans that will reach beyond our large cities and jump-start key projects in our smaller cities, which play such a central role in our economic future.

• Housing Opportunity Fund

$100 million dollars is slated for Upstate housing and community development. Each Upstate community has a different housing need, whether it's affordable housing, market-rate housing, housing for young professionals, supportive housing for people with disabilities, or housing rehabilitation.

• Upstate Agribusiness Fund

Governor Spitzer pledged to infuse $50 million into the agricultural sector, which forms the bedrock of so many local economies throughout Upstate. Investments will support access to markets, new and expanded food processing centers, and development of alternative fuels. Governor Spitzer announced he will hire New York's first Director of Agriculture Development.

• Universal Broadband Access

Currently only 25 percent of New Yorkers in rural areas have access to affordable, high-speed Internet. The Governor proposed tripling the state's investment in high-speed, affordable broadband access across New York to $15 million. This will move New York State closer to the day when we can close the digital divide and offer everyone in rural areas access to the high speed, affordable broadband Internet they need to compete in the Innovation Economy.

• Transportation

Governor Spitzer also vowed to continue to invest in traditional infrastructure—namely roads, bridges and highways. As such, the Upstate Revitalization Fund will include $100 million to support critical maintenance of the Upstate network of State and local bridges.

• Parks

Governor Spitzer pledged $80 million investment to restore New York's state parks. Parks are undeniably a major asset when it comes to attracting business and creating livable communities. As the centerpiece of our restoration, we will return the Niagara Reservation State Park in Niagara Falls to its former glory.

Beyond the $1 Billion Upstate Revitalization Fund, Governor Spitzer also proposed several initiatives that will further benefit the Upstate region, which included:

• Creation of a bipartisan Commission – vested with Moreland Act investigatory powers – to make recommendations for addressing the root causes of high costs, providing additional middle-class tax relief, and developing a cap on annual increases in local school property taxes;
• Extend long-term and reform the Power for Jobs and Energy Cost Savings Benefit programs in order lower Upstate’s energy costs;
• Increase local aid by $50 million to the most distressed cities and towns through the Aid and Incentives to Municipalities program;
• Build new Crime Analysis Centers in Buffalo, Rochester, Syracuse and Albany, which will include a comprehensive array of world-class crime fighting tools; and
• Create a “Doctors Across New York” plan to address the desperate need for doctors in many of New York’s inner cities and rural areas.
• Protecting the environment by pushing to pass the Great Lakes Compact, so we can join a multi-state effort to regulate water levels and maintain a strong, sustainable Great Lakes ecosystem and economy.

The full text of the speech will be available at http://www.ny.gov/governor/keydocs/keydocs-speeches.html.

A copy of the attached 2007 Jobs Figures can be found here: HTML, PDF

The $100,000 Pyramid

Army Times
http://www.armytimes.com/news/2008/01/mili...harity_080117w/


Lawmakers:
Vets charity must be accountable

By Karen Jowers - Staff writer
Posted : Thursday Jan 17, 2008 21:33:24 EST

Retired Army Gen. Tommy Franks was paid $100,000 — out of donations made to wounded veterans — for allowing his name to be used on fundraising appeals by a charity that has come under increasing scrutiny for the way it handles its money.

Lawmakers questioned the ethics of the Coalition to Salute America’s Heroes Foundation not only for using donors’ money to pay Franks, but for failing to disclose to potential donors who received the mail solicitations that Franks was paid for his endorsement.

Rep. Henry Waxman, chairman of the House Committee on Oversight and Government Reform, said Franks has now disassociated himself from the Coalition and asked that his name not be used in connection with the solicitations.

Franks’ endorsement helped the charity raise “millions of dollars more” than it otherwise could have, said Roger Chapin, president of Help Hospitalized Veterans Inc., and the Coalition to Salute America’s Heroes Foundation. At a Jan. 17 hearing, Chapin said he is also paying retired Air Force Brig. Gen. Arthur (Chip) Diehl III $5,000 a month for similar assistance.

Rep. Chris Cannon, R-Utah, noted that other lawmakers had implied that Franks and Diehl had sold their integrity by working with Chapin.

“Absolutely not — it’s an insult!” replied Chapin.

A spokesman for Franks, the former chief of U.S. Central Command in the early stages of the wars in Afghanistan and Iraq, said the general did support the Coalition in 2004 and 2005.

Franks “made several speeches for the organization because he supports the idea of taking care of our disabled veterans,” said retired Army Col. Michael Hayes, Franks’ chief of staff, in an e-mail response to questions.

“He also permitted the use of his name in direct mailings for about a year,” Hayes said. “He ended his support … in late 2005 when he learned the percentage of money raised that was going to the troops was less than 85 percent, a figure which was then, and remains today, his criteria for supporting charitable organizations.”

The payment to Franks is just one facet of lawmakers’ concerns about the finances of Chapin’s groups and others like it. Congress is exploring whether legislation is needed to provide more protections for donors and the people they are supposedly donating to.

“I don’t begrudge people getting money,” said Rep. Eleanor Holmes Norton, D-D.C. “It’s all about disclosure.”

The three-hour hearing was charged with heated exchanges about Chapin’s operations and the disclosure of costs to donors.

Lawmakers pushed Chapin and two executives of fundraising companies on the question of whether solicitations should disclose information about the percentage of donations that a group spends on fundraising.

“If we disclose, we’d be out of business,” Chapin said.

“Your words are wonderful, because if the public knew, they wouldn’t donate,” said Rep. Christopher Shays, R-Conn.

Chapin acknowledged that his organization has used inflated numbers in its mailings when describing what percentage of donations actually helps veterans.

While some mailings have stated that 92 percent or even 100 percent of donations have gone to veterans, the real figure is closer to 25 percent, according to a congressional study.

An analysis of Chapin’s financial documents by the committee’s staff showed that his organizations took in more than $168 million in donations from 2004 to 2006. They spent $125 million on fundraising, overhead and administrative costs, and the rest — only about 26 percent of the total — on veterans.

“I’ve tried everything under the sun to reduce fundraising costs,” Chapin said, including a variety of advertising.

“What about reducing your salary?” asked Rep. Elijah Cummings, D-Md.

According to the committee’s analysis, Chapin and his wife received $1.5 million in salary from 2004 to 2006 and also were reimbursed more than $340,000 for meals, hotels, entertainment and other costs.

Chapin said his salary is in the lower half of salaries of charity executives, while his performance is in the upper half. Committee staff members contest that figure, noting that his salary actually falls within the median range of for-profit executive compensation.

Among other things, the committee questioned why Help Hospitalized Veterans has authorized a payment of $17,000 for a country club membership on behalf of one of the company’s officers. “I think it’s appropriate,” Chapin said. “The board is not paid, they volunteer.”

In 2006, Help Hospitalized Veterans also bought a $444,600 condo in Northern Virginia that is used by the Chapins. Chapin said they were spending so much time in the area for organization business that it seemed more convenient to buy the property. Some of the wounded veterans at the heart of the controversy remain convinced of the value of Chapin’s organizations.

“I’m very disappointed in them for attacking Roger,” said Navy Construction Mechanic 1st Class Peter Reid, wounded in Iraq in 2004 and now partially paralyzed with a brain injury and the loss of an eye, who attended the hearing.

Reid’s wife, Michele, said the Coalition helped them find the right government agencies to get their earned benefits and arranged to fly them to an annual Florida conference that educates severely wounded combat vets and families about resources and strategies for dealing with their altered life circumstances.

“If it weren’t for [the Coalition], we’d be homeless, under a bridge,” said Reid, who is on the temporary disability retirement rolls. “I’m just like any other man — I want to provide for my family. The Coalition showed me I could do that.”

FKN News 1-19-07

Rick Nash Goal of the year?

Senator Obama Reagan?

Rivals Slam Obama Over Reagan Praise

Jan 19 02:45 AM US/Eastern By NEDRA PICKLER Associated Press Writer	Write a Comment

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RENO, Nev. (AP) - John Edwards and Hillary Rodham Clinton criticized Barack Obama's praise of the Republican Party and Ronald Reagan—an anathema for many Democrats, particularly union members considered crucial to winning Nevada's Democratic caucuses Saturday. Obama responded by suggesting Clinton would be a "president whose plans change with the politics of the moment" as part of one of his most direct critiques of the New York senator yet. The intensity reflects what polls suggest could be a tight contest Saturday as Nevada plays its most prominent role ever in a presidential nominating campaign. Nevada was granted a coveted spot right after Iowa and New Hampshire in an attempt to bring more racial and geographic diversity into the selection. The novelty means there isn't a reliable way to determine who is likely to turn out at caucuses across the state. In addition, nine caucuses are to be held in casinos for the first time to allow shift workers to participate on a busy holiday weekend—making the result even more unpredictable. Obama got a boost when he won the endorsement of the Culinary Workers Union that represents 60,000 housekeepers, bartenders, waiters and other employees on the Las Vegas Strip. Then a judge dismissed an attempt to eliminate the casino caucus sites. But Clinton still holds an edge in most polls. Edwards, his chances for the presidency diminished by losses to Obama in Iowa and Clinton in New Hampshire, did not run television ads in the state and did not plan to stay in Nevada to wait for results. His schedule Friday had him leaving to campaign in Oklahoma, Missouri and Georgia, among the more than 20 states that vote on Super Tuesday, Feb. 5. Edwards questioned Obama's commitment to labor in his final appeal to Nevada voters—a rally with about 100 of his precinct captains in Las Vegas. "Ronald Reagan, the man who busted unions, the man who did everything in his power to destroy the organized labor movement, the man who created a tax structure that favored the richest Americans against middle class and working families, ... we know that Ronald Reagan is not an example of change for a presidential candidate running in the Democratic Party," Edwards said. Reagan also "was destructive to the environment by removing a lot of the regulation that existed," Edwards added in a later telephone interview with The Associated Press. "I would never use Ronald Reagan as an example of change." Obama told the Reno Gazette-Journal editorial board Monday that "Reagan changed the trajectory of America in a way that Richard Nixon did not and in a way that Bill Clinton did not. He put us on a fundamentally different path because the country was ready for it," Obama said. "I think it's fair to say that the Republicans were the party of ideas for a pretty long chunk of time there over the last 10 to 15 years in the sense that they were challenging conventional wisdom," Obama told the newspaper. On Friday in Las Vegas, Clinton responded, "That's not the way I remember the last ten to fifteen years." She said she didn't consider it a better idea to privatize Social Security, eliminate the minimum wage, undercut health benefits, shut down the government or drive the country into debt. "I think we know what needs to be done in America. And I think we're ready to do it. I'm ready to lead on day one." Obama questioned her claim while campaigning at the University of Nevada Reno. "Senator Clinton has said she is ready to lead from day one, but it's important on day one to get it right, whether you're talking about war or you're talking about economic proposals." Obama said Clinton recently joined his call for a tax rebate. When she initially announced her economic stimulus plan last week, she said she would consider a tax rebate in the future if the economy worsened. "This is a larger point that has to be made," he said. "It is easy to be for policies that help working families when it's popular on the campaign trail, but the American people don't want a president whose plans change with the politics of the moment." Two Obama supporters said they received automated phone calls Friday evening in which the senator was described as supporting a Republican agenda. Gregory Martin, a financial adviser in Reno, said the caller, who had a woman's voice, said she was calling to bring to his attention recent comments Obama had made "in support of the Republican Party and Bush's vision for America." The call also said Obama was in favor of storing nuclear waste at Yucca Mountain and was identified as coming from "friends of Hillary Clinton," Martin said. Amber Erlich, an Obama volunteer from Phoenix, received a similar recorded call at the home of another volunteer in Pioche, Nev., she said. The caller, also a woman, said Obama wants to dump waste at Yucca Mountain and had called the Republican Party "the party of ideas," Erlich said. The Clinton campaign did not immediately respond to request for comment. Clinton aides said earlier there were reports of voter intimidation and confusion among Culinary Union members who support Clinton. Some union members thought the union's endorsement of Obama meant they wouldn't be allowed to caucus for Clinton, while others feared retaliation if they chose to caucus for Clinton, the aides said. "I'm afraid some people may feel that they can't come or they shouldn't come or can't support the candidate of their choice," Clinton herself said during a campaign appearance in Elko. "We know there are some unions in the south who are telling people who to caucus for and if they're not going to caucus for who they choose, don't come at all. I don't think that's right." ___ Associated Press writers Kathleen Hennessey and Beth Fouhy in Las Vegas, and Evan Berland in South Carolina contributed to this report.