Free Internet Press Newsletter - Saturday September 27 2008 - (813)

Saturday September 27 2008 edition
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Obama, McCain Square Off On Iraq And Economy 2008-09-27 03:49:57 Sen. Barack Obama sharply criticized Sen. John McCain's judgment on the war in Iraq, repeatedly telling his presidential rival "you were wrong" to rush the nation into battle, directly challenging the Republican nominee on foreign policy as the two met in their first debate of the general-election season. McCain aggressively pushed back, accusing Obama of failing to understand that a new approach employed by Gen. David H. Petraeus in Iraq would lead to victory and mocking him as naive for his willingness to meet with some of the world's most brutal leaders. With 40 days remaining before Election Day and the U.S. economy teetering, the two clashed on taxes, energy policy, Russian aggression in Georgia and the threat posed by Iran. Neither made a serious mistake in an encounter that capped one of the most chaotic weeks of the campaign, nor was either able to claim a decisive victory. The debate itself almost did not happen. McCain's dramatic midweek announcement that he was suspending his campaign to focus on the nation's financial crisis left the face-off in limbo as both candidates rushed back to Washington on Thursday and plunged themselves into the acrimonious negotiations over a $700 billion economic bailout. On Friday, McCain reversed his pledge to stay in Washington until those negotiations concluded. And once on stage at the University of Mississippi,it was the exchanges about how to keep the United States safe that put the starkest differences between the two men on display. Read The Full Story U.S. Public Isn't Buying Wall Street Bailout 2008-09-26 15:13:33 As congressional leaders struggled to craft a bailout plan for the nation's troubled financial system Thursday, angry protesters mobbed Wall Street, telephones rang off the hook in House and Senate offices and a group of prominent economists sent off e-mail blasts critiquing the proposal. Numerous opinion polls taken this week came to wildly varying conclusions about the level of support among Americans for the Bush administration's $700-billion plan. But the increasingly loud roar coming from all corners of the nation shows that the idea of a bailout has touched a particularly sensitive nerve among the public. A spokesman for Sen. Dianne Feinstein (D-Calif.) said her five offices had doubled staffing to deal with the constantly ringing phones. Through late Thursday, Feinstein's offices had received a total of 39,180 e-mails, calls and letters on the bailout, with the overwhelming majority of constituents against it. The spokesman said the volume was as great as during the immigration debate and at key points during the war in Iraq. U.S. Rep. Linda T. Sanchez (D-Lakewood, California) was also hearing it from her district, which includes parts of the city of Los Angeles and unincorporated L.A. County. "My constituents are telling me loud and clear that they aren't convinced," she said in a statement. Typical of the tone of such contacts, Sanchez's office said, was a missive from a constituent in Whittier: "The bailout legislation is being rammed through Congress in a matter of days. This is an illegal power grab by the White House and their richest friends on Wall Street." Read The Full Story Somali Pirates Seize Ukraine Ship Carrying Tanks, Weapons 2008-09-26 15:13:11 Somalia's notorious pirates have staged perhaps their most brazen attack yet, seizing a Ukrainian ship in the Indian Ocean full of arms bound for Kenya’s military, including dozens of battle tanks, maritime and diplomatic officials said Friday. Somalia’s 1,880-mile coastline is infested with pirates, and they have been striking with increasing impunity, grabbing everything from private sailing yachts to oil tankers. They then usually demand millions of dollars in ransom for the ships and their crews. This time the pirates may have gotten more than they bargained for. Unloading the tanks is likely to be well beyond the capacity of the pirates, said experts. Meanwhile, an American naval vessel was Friday in hot pursuit to intercept the ship and the Russian Navy said it was not far behind. The Ukrainian ship was seized Thursday evening about 200 miles off the coast of Somalia. According to Andrew Mwangura, the program coordinator of the Seafarers’ Assistance Program in Kenya, the ship was carrying around 30 T-72 battle tanks, which were to be offloaded in Mombasa, Kenya. Read The Full Story German Police Arrest Terror Suspects 2008-09-26 15:12:36 The arrest of two terror suspects at the Cologne-Bonn airport and a nationwide search for two other suspected militants rattled Germany on Friday. German police boarded a Dutch airliner at 6:55 a.m., shortly before it was to take off, and seized two men, identified as a 23-year-old Somali and a 24-year-old German born in Somalia. Officials said that the men were unarmed, but that documents explaining they were ready to fight and die for jihad had been found. The men had been under surveillance for some time, according to a German security official, speaking on condition of anonymity because he was not authorized to discuss the case. Their travel plans had them going to Uganda via Amsterdam, said the official. The extent of any threat posed by the two men was far from certain Friday, but theirs were the second set of terrorism-related arrests in barely more than a week, as German officials tasked with preventing a terrorist attack on their country say they see signs of heightened activity among radical Islamists. Even more troubling, officials here said, were two suspects not yet in custody. Read The Full Story Evangelist Alamo Faces Charges In Child Sex Investigation 2008-09-26 15:12:12 Evangelist and convicted tax evader Tony Alamo will be extradited to Arkansas from Arizona after his arrest on charges he took minors across state lines for sexual purposes. Alamo appeared briefly in U.S. District Court Friday and waived his right to fight extradition. U.S. marshals say they will transport him as soon as possible, although exactly when isn't known. The one-time rock promoter and street preacher was arrested by the FBI while leaving a Flagstaff hotel Thursday on charges of violating the Mann Act, usually used in interstate prostitution cases. Read The Full Story Bush's Bailout Meeting Ends in Disarray; McCain Gets Blame 2008-09-26 02:25:48 Congressional negotiators’ carefully-crafted agreement on a $700 billion rescue plan threatened to unravel Thursday as lawmakers at an often tense White House meeting clashed over details. As Republican presidential nominee John McCain looked on, House Republican Leader John Boehner raised concerns that the plan would be too costly to taxpayers, and offered an alternative plan. Democrats were mad. "What this looked like to me was a rescue plan for John McCain," said Senate Banking Committee Chairman Christopher Dodd of the Republican objections. His reference was to McCain's eleventh-hour intervention in the negotiations, when he declared he was suspending his campaign and postponing Friday night's debate with Democrat Barack Obama to help negotiate a bailout plan. Democrats think that Republicans were backing away from a compromise many of them agreed to earlier Thursday - without McCain's involvement - in order to give McCain time to play a role and perhaps appear as a rescuer. Read The Full Story Commentary: Crash 2008-09-26 02:25:20 Intellpuke: This commentary was written by Timothy Egan and appeared in the New York Times edition for Wednesday, Sept. 24, 2008. The big guy with the crew cut and a hand that lost three fingers to a meat grinder looked out at the most powerful men in global capitalism Tuesday, and asked a pointed question: “I’m a dirt farmer,” said Senator Jon Tester, the Montana Democrat who still lives on his family homestead. “Why do we have one week to determine that $700 billion has to be appropriated or this country’s financial system goes down the pipes?” Good question, one that Treasury Secretary Henry M. Paulson and Federal Reserve Chairman Ben Bernanke have yet to adequately answer. If they seemed flummoxed, perhaps it’s because they still can’t explain what will be accomplished by nearly nationalizing the banking system and giving the treasury secretary more power than a king. Another question - since we now own a big part of the world’s largest insurance company, A.I.G., does that mean I can save a load of money on my car insurance? - might be easier to answer. This bailout, in present form, is toast. Now, with John McCain offering to suspend his campaign and delay Friday’s debate, it looks like the drainage of years past is pulling him down. He wants to back out of facing Barack Obama at the height of the campaign. Why not change the topic, from foreign affairs to the economy? Some have already tried to protect the true villains of the crash of 2008. Witness Neil Cavuto of Fox News, he of the sycophantic questions to Enron executives and other thieves just before they were exposed, blaming the mortgage crisis on banks lending to “minorities and risky folks,” as he said last week. There is certainly a food chain of greed, from the lowliest house-flipper in the Southern California exurbs to the Hamptons hedge fund manager. We all put reason in a box and buried it for a time; but before $700 billion is committed to a secretary whose decisions “may not be reviewed by any court of law or any administrative agency,” as the original draft of the bailout states, it’s worth remembering where the biggest heist took place, and how Wall Street dragged down the rest of the country once before. You could hear the echoes of history in Tester’s question, riding the fierce urgency of now at a time when the Great Depression and all its gloomy atmospherics are in the air again. Read The Full Story Washington Mutual Sold In Biggest U.S. Bank Failure 2008-09-26 02:24:35 Federal regulators Thursday night seized the massive, troubled mortgage lender Washington Mutual in the largest bank failure in U.S. history, then immediately sold much of the company to J.P. MorganChase for $1.9 billion in a deal that will create the largest bank in the country. The historic two-step was orchestrated by Sheila Bair, chairman of the Federal Deposit Insurance Corporation (FDIC), on terms that preserve Washington Mutual's deposits and avoid what could have been a huge drain on the insurance fund that protects deposits up to $100,000. The fall of Washington Mutual, which was the country's largest savings and loans, expands once again the vast burned-over district at the heart of the financial industry. The federal government has seized mortgage-financiers Fannie Mae and Freddie Mac and insurance giant American International Group. The five largest independent investment banks are closed or have changed their business model. Most of the largest mortgage companies are closed or sold. This is the first time, however, that a large bank funded mostly by deposits has failed during the current crisis. The sale furthers the consolidation of the U.S. financial industry, which is increasingly dominated by a few colossal banks with more than $1 trillion in assets, offering a vast range of services. J.P. Morgan will become the largest, surpassing Bank of America. Read The Full Story Prosecutor: Sen. Stevens Knowingly Hid Gifts 2008-09-26 02:23:59 A Justice Department prosecutor told a jury Thursday that U.S. Sen. Ted Stevens, who has represented Alaska in  the Senate for 40 years, engaged in “a scheme to conceal from the public” a variety of gifts and home renovation services he received. In her opening statement of what is expected to be a nearly month-long trial, the prosecutor, Brenda Morris, said  Stevens knowingly did not list on Senate disclosure forms goods and services totaling $250,000 that he received from an Alaska contractor, Bill Allen. Stevens, 84, the longest-serving Republican in the Senate’s history, has pleaded not guilty to seven felony counts of filing false statements. Morris listed several items she said Stevens had received in recent years, including a sled dog and a massage chair, but at the heart of the case, she noted, was the makeover of the Stevens family home in Girdwood, Alaska. She said Allen, a freewheeling oil services contractor and onetime friend of Stevens, paid for most of the renovations, which included a new first floor built after jacking up the house, along with two new decks, a garage, lighting and a built-in gas grill. In his opening statement, Stevens’ lawyer, Brendan Sullivan, told the jury that the senator did not “intentionally violate the law” and was misled by Allen about the exact costs. Sullivan also offered a new and striking assertion: that Stevens had not been familiar with the details of the project and could not have knowingly concealed the costs, because Stevens’ wife of 28 years, Catherine Stevens, had the principal responsibility to look after the details of the renovation. Read The Full Story	Congress Plows Ahead Drafting The Bailout Bill 2008-09-27 03:49:45 Talks over the Bush administration's plan to stabilize the U.S. financial system lurched forward Friday, as rebellious Republicans returned to the negotiating table and congressional aides began the tortuous work of drafting a bill to execute one of the biggest interventions into the private market in modern history. One day after they nearly derailed the plan, House Republicans agreed to send their second-ranking leader to negotiate with Democrats and Senate Republicans. Lawmakers canceled plans to adjourn Friday for the November election and instead prepared to work through the weekend on the proposal, which would authorize the Treasury Department to spend up to $700 billion to take bad assets off the books of faltering financial institutions. Democrats said they hoped to announce an agreement late Sunday before Asian financial markets open, with a House vote on the measure possible by Monday. A Senate vote would follow later in the week. "Great progress is being made. We will not leave until legislation is passed that will be signed by the president," said House Speaker Nancy Pelosi (D-California). Added Rep. Barney Frank (D-Massachusetts), an architect of the legislation: "I am convinced that by Sunday we will have an agreement people will understand." Read The Full Story McCain Decides To Participate In Debate 2008-09-26 15:13:22 Senator John McCain's campaign said Friday morning that he will attend Friday night’s debate with Senator Barack Obama at the University of Mississippi, reversing his earlier call to postpone the debate so he could participate in the Congressional negotiations over the $700 billion bailout plan for financial firms. Moments after Senator McCain ended several of days of suspense and announced that he would participate in the debate after all, the doors of his campaign plane were opened and the steps were down, as Obama’s 757 idled nearby on the runway at Ronald Reagan National Airport outside Washington, according to a pool report. Both planes were set to arrive in Memphis on Friday afternoon. Senator Obama finished a round of telephone calls with Congressional leaders and Treasury Secretary Henry M. Paulson, Jr., before leaving Washington to prepare for the first presidential debate of the general election. He arrived in Memphis about 12:30 p.m. CDT, and was set to make his way to Mississippi for a walk-through of the debate hall. “My strong sense is that the best thing that I can do, rather than to inject presidential politics into some delicate negotiations, is to go down to Mississippi and explain to the American people what is going on and my vision for leading the country over the next four years,” Obama told reporters aboard his plane. “I’m looking forward to the debate and look forward after the debate to coming back to Washington and hopefully getting a package done.” Obama said he was encouraged by the Congressional negotiations underway on the government’s bailout package of the nation’s financial institutions, and “optimistic” at the prospects for a deal. Read The Full Story Russia Loans Venezuela $1 Billion For Military 2008-09-26 15:12:49 Russia stepped up efforts to project its increased might on the world stage on Friday, welcoming Venezuela's President Hugo Chavez  by signing a $1 billion military loan to Venezuela and announcing wide-ranging plans to modernize its nuclear deterrence. The Russian Navy also dispatched a warship to the Indian Ocean to try to intercept a Ukrainian vessel carrying 30 battle tanks that was seized by pirates, as the United States also sent a warship in hot pursuit. (Intellpuke: You can read a separate article on seized Ukranian vessel elsewhere on today's Free Internet Press mainpage.) After a military exercise in the southern city of Orenburg, near the border with Kazakhstan, the Russian president, Dmitri A. Medvedevdeclared that by 2020 Russia would construct new types of warships, including nuclear submarines carrying cruise missiles, and an unspecified space defense system. "A guaranteed nuclear deterrent system for various military and political circumstances must be provided by 2020," said Medvedev, in comments reported by Reuters. "Large-scale construction of new types of warships is planned, primarily of nuclear submarines armed with cruise missiles, and multi-purpose submarines," he was quoted as saying. “A system of air and space defense will be created.” Read The Full Story Palin Accepted $25,000 In Gifts From Mining Interests, Others 2008-09-26 15:12:26 Alaska Gov. Sarah Palin, who has made a crackdown on gift-giving to state officials a centerpiece of her ethics reform agenda, has accepted gifts valued at $25,367 from industry executives, municipalities and a cultural center whose board includes officials from some of the largest mining interests in the state, a review of state records shows. The 41 gifts Palin accepted during her 20 months as governor include honorific tributes, expensive artwork and free travel for a family member. They also include more than $2,500 in personal items from Calista, a large Alaska native corporation with a variety of pending state regulatory and budgetary issues, and a gold-nugget pin valued at $1,200 from the city of Nome, which lobbies on municipal, local and capital budget matters, documents show. About a quarter of the entities bestowing gifts on the governor are represented by one of Alaska's most influential mining lobbyists, who said in an interview that she was not involved in the tributes. The lobbyist, Wendy Chamberlain, has a relationship with the governor's family through the friendship of their teenage daughters. On forms disclosing the gifts, Palin, who is the Republican vice presidential nominee, routinely checked "no" when asked whether she was in a position to "take official action that may affect the person who gave me the gift," and a spokeswoman for Sen. John McCain's presidential campaign said the gifts had no undue influence on her. Read The Full Story White House Meeting Fails To Yield Bailout Bill 2008-09-26 02:25:59 A renegade bloc of Republicans moved to reshape a massive bailout of the U.S. financial system Thursday, surprising and angering Bush administration and congressional leaders who hours earlier announced agreement on the "fundamentals" of a deal. At the White House meeting that included President Bush, top lawmakers and both presidential candidates, House  Minority Leader John A. Boehner (R-Ohio) floated a new plan for addressing the crisis that has hobbled global markets. Democrats accused Boehner of acting on behalf of Republican presidential candidate Sen. John McCain (Arizona)  in trying to disrupt a developing consensus. The new proposal also displeased White House officials, including Treasury Secretary Henry M. Paulson, Jr., who chased after Democrats leaving the meeting and - half-jokingly - dropped to one knee and pleaded with them not to "blow up" the $700 billion deal, according to people present at the meeting. Before the meeting broke up, President Bush had issued a stark warning about the impact on the nation's economy if the measure did not pass. "If money isn't loosened up, this sucker could go down," said Bush, according to one person in the room. Under the alternative Republican plan, the government would set up an expanded insurance system, financed by the banks, that would rescue individual home mortgages. The government would not have to buy up the toxic mortgage-backed assets that are weighing down financial institutions. Read The Full Story Carbon Building Up In Atmosphere Faster Than Dire Predictions 2008-09-26 02:25:34 The rise in global carbon dioxide emissions last year outpaced international researchers' most dire projections, according to figures being released today, as human-generated greenhouse gases continued to build up in the atmosphere despite international agreements and national policies aimed at curbing climate change. In 2007, carbon released from burning fossil fuels and producing cement increased 2.9 percent over that released in 2006, to a total of 8.47 gigatons, or billions of metric tons, according to the Australia-based Global Carbon Project, an international consortium of scientists that tracks emissions. This output is at the very high end of scenarios outlined by the Intergovernmental Panel on Climate Change (IPCC) and could translate into a global temperature rise of more than 11 degrees Fahrenheit by the end of the century, according to the panel's estimates. "In a sense, it's a reality check," said Corinne Le Quéré, a professor at the School of Environmental Sciences at the University of East Anglia and a researcher with the British Antarctic Survey. "This is an extremely large number. The emissions are increasing at a rate that's faster than what the IPCC has used." The new statistics also underscore the growing contribution to the world's "carbon budget" from rapidly industrializing countries such as China, India and Brazil. Developing nations have roughly doubled their carbon output in less than two decades and now account for slightly more than half of total emissions, according to the new figures, up from about a third in 1990. By contrast, total carbon emissions from industrialized nations are only slightly higher than in 1990. Read The Full Story Editorial: What About The Rest Of Us? 2008-09-26 02:25:10 Intellpuke: This editorial appeared in the New York Times edition for Thursday, Sept. 25, 2008. Lawmakers were still wrangling Thursday night about the Bush administration’s $700 billion bailout of the financial system. Political theater was mainly responsible for the delay, but it will be worth the wait if lawmakers take the time to make sure that the plan includes real relief for homeowners and not only for Wall Street. The problems in the financial system have their roots in the housing bust, as do the problems of America’s homeowners. Millions face foreclosure, and millions more are watching their equity being wiped out as foreclosures provoke price declines. The problems became even more evident Thursday night with the federal seizure and sale of Washington Mutual to JPMorgan Chase. It’s unacceptable that lawmakers have yet to come out squarely in favor of bold homeowner relief in the bailout bill. Treasury Secretary Henry Paulson, the biggest advocate of bailing out Wall Street, is also a big roadblock to helping hard-pressed borrowers. He wants to keep relying on the mortgage industry to voluntarily rework troubled loans, even though that approach has failed to stem the foreclosure tide - and does a disservice to the taxpayers whose money he would put at risk in the bailout. Read The Full Story Economists Question Basis Of Paulson's Plan 2008-09-26 02:24:21 The Bush administration's pitch for a sweeping bailout of the financial system has centered on two simple premises: that the economy could suffer a crippling downturn if action is not taken very quickly and that this action should consist of the government buying troubled mortgage securities from banks and other institutions. Yet many of the nation's top economists disagree with one or both of those ideas, even as many top political leaders have swung behind them. Wall Street economists have mostly endorsed Treasury Secretary Henry M. Paulson, Jr.'s plan, or a variation thereof. Almost 200 academic economists - who aren't paid by the institutions that could directly benefit from the plan but who also may not have recent practical experience in the markets - have signed a petition organized by a University of Chicago professor objecting to the plan on the grounds that it could create perverse incentives, that it is too vague and that its long-run effects are unclear. Sen. Richard C. Shelby (Alabama), ranking Republican on the Budget Committee, brandished that letter Thursday afternoon as he explained his opposition to the bailout outside a bipartisan summit at the White House. The petition did not advocate any specific plan, including that offered yesterday by House Republicans. Economists tend to agree that the nation's economy is at serious risk as the flow of credit threatens to freeze. Just Thursday, the interest rate at which banks lend to each other rose steeply, as it has every day this week, suggesting that lenders are hoarding cash. History shows that when this happens, a broad economic crisis can follow, for instance, the Great Depression and Japan's decade-long recession in the 1990s. Read The Full Story Palin To Return Donations From Tainted Politicians 2008-09-26 02:23:28 Republican vice presidential nominee Sarah Palin said late Thursday she would donate to charity more than $1,000 in campaign contributions from two Alaska politicians who were implicated in a sprawling public corruption scandal. She's also handing back another $1,000 from the wife of one of the men. The announcement from a spokesman for the campaign of Republican nominee John McCain came hours after the Associated Press reported Palin had accepted the checks during her successful 2006 run for Alaska governor in the weeks after the FBI raided the offices of the lawmakers. The ensuing scandal became a rallying point for candidate Palin, who was swept into office after promising voters she would rid Alaska's capital of dirty politics. ''Of course, Governor Palin has made a career of holding herself to the highest standards of ethics. As soon as the governor learned of the donations today, she immediately decided to donate them to charity,'' said the spokesman, Taylor Griffin. Griffin said he did not know which charity would receive the money from Palin's old campaign fund, but expected the return to take place as early as Friday. Read The Full Story
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