Fire Hydrant of Freedom

Dear Marc F.,

Thanks to the action of tens of thousands of National Association for Gun Rights’ members, New Jersey gun owner Brian Aitken was able to spend Christmas 2010 with his family.

But for a long time this story looked like it would have a grim ending...

Mr. Aitken was convicted and sentenced to seven years in prison in New Jersey for never actually committing a crime.

After moving from Colorado, Aitken was careful to follow every absurd gun law in New Jersey to a “T”.

His efforts were in vain as he was promptly imprisoned for violating those same laws after a judge threw out most of the evidence proving Aitken’s innocence.

In prompt response, I launched a series of e-mails asking National Association for Gun Rights members to sign a petition demanding Governor Christie pardon and release Mr. Aitken.

National Association for Gun Rights’ members answered the call and unleashed an avalanche of real political pressure.

Volunteers on the ground in New Jersey personally delivered more than 25,000 petitions to Governor Christie’s office.

As Senator Everett Dirkson once said "when I feel the heat, I see the light."

And pro-gun Americans lit the fire that forced a spotlight of attention on Governor Chris Christie of New Jersey.

 

It's tough for any politician not to notice that many signatures.

And the Monday after delivery, Mr. Aitken's sentence was fully commuted and he was released from prison to spend the holidays with his family.

You read that correctly: Governor Christie felt the pressure of Second Amendment supporters like you and freed Brian Aitken from prison.

That's the kind of fight you can expect as a member of the National Association for Gun Rights.

Unfortunately, it wasn't a full pardon, and that's why I am keeping my eye on New Jersey.

Governor Christie shows all the signs of a man who could attempt to secure the Republican nomination for a White House run, and you and I must get him on the record as saying that the gun laws in places like New Jersey are a slap in the face to its citizens.

Simply commuting the sentence of an innocent man isn't enough by itself.

Political insiders are keenly aware of how much the votes of Second Amendment supporters can make a difference in a national election.

But people like Governor Christie have spent their political careers in places like New Jersey where they've tried to play both sides of the fence.

He needs to be aware of the fact that the rest of this country will not tolerate offenses to our Constitutional liberties.

Nor will they allow Gestapo-style kangaroo courts where law-abiding citizens go to prison with stiffer sentences than drug dealers and rapists for exercising their basic freedoms.

Members and activists from the National Association for Gun Rights are driving this point home by holding Governor Christie's feet to the fire with petitions from across the country.

He now has to contend with the simple fact that, in less than a week, you and other members of the National Association for Gun Rights were able to blast out 25,000 petition signatures as well as print them and deliver them directly to his office.

Applying political pressure does make a difference, especially when the pressure is crate after crate of petitions dumped on a governor's desk.

And Mr. Aitken spent his Christmas with his family instead of behind bars.

If you want to get involved in the next battle for the Second Amendment, stay connected and look for alerts from the National Association for Gun Rights.

Yours in Freedom,

 
Dudley Brown
Executive Director
National Association for Gun Rights

P.S. Click here to help the National Association for Gun Rights continue to fight for people like Brian Aitken by making a donation.

A fortuitous combination of ravenous bacteria, ocean currents and local topography helped to rapidly purge the Gulf of Mexico of much of the oil and gas released in the Deepwater Horizon disaster of 2010, researchers reported on Monday.

After spewing oil and gas for nearly three months, the BP PLC well was finally capped in mid-July 2010. Some 200,000 tons of methane gas and about 4.4 million barrels of petroleum spilled into the ocean. Given the enormity of the spill, many scientists predicted that a significant amount of the resulting chemical pollutants would likely persist in the region's waterways for years.

According to a new federally funded study published Monday by the National Academy of Sciences, those scientists were wrong. By the end of September 2010, the vast underwater plume of methane, plus other gases, had all but disappeared. By the end of October, a significant amount of the underwater offshore oil—a complex substance made from thousands of compounds—had vanished as well.

"There was a lot of doomsday talk," said microbiologist David Valentine of the University of California at Santa Barbara and co-author of the study, published in Proceedings of the National Academy of Sciences. But it turns out "that the ocean harbors organisms that can handle a certain amount of input" in the form of oil and gas pollutants, he said.

A year ago, Dr. Valentine and other scientists published a paper describing how naturally occurring bacteria had apparently devoured much of the toxic chemicals released in the BP spill. That federally funded study, published in the journal Science, triggered disbelief among other researchers who questioned whether microbes could gobble up that much gas and oil so quickly.

Dr. Valentine and his colleagues have now used a computer model to explain just how that scenario might have played out. "The skepticism was certainly one of the contributing factors that spurred us to go and do this [new] study," he said.

It was an intricate challenge. The first step was to estimate the flow rate of the various hydrocarbons from the well over the 87 days that the spill continued. The researchers identified 26 classes of such chemicals; they then had to figure out which of these chemicals stayed in the deep plume that remained more than 1,000 meters underwater, and which ones rose up to the surface. For example, in the plume, certain chemicals dissolved completely in the water, including the methane gas, while some of the oil droplets were atomized and remained suspended in the water. A lot of the surface oil evaporated or washed up on Gulf shorelines.

Next, the scientists set about identifying the main species of oil-and-gas-eating bacteria that lived in the deep Gulf. They identified 52 main species of such microbes. The scientists also estimated how quickly the bacteria consumed oil and gas, and how much the bacteria colonies grew.

The final step was to model the complex movement of the water in the Gulf to determine where the oil and gas—and the bacteria—got transported. Igor Mezic, a colleague of Dr. Valentine's and also a co-author, had published a study in 2011 predicting where the BP oil slick had spread. That analysis included data from the U.S. Navy's model of the Gulf's ocean currents and observations of the water's movements immediately after the spill and for several months after it ended.

The UC Santa Barbara researchers decided to marry their two computer models—the one about the spill-eating bacteria with the one that captured the movement of water. When they ran the joint model, they found that it helped to explain the puzzle of the rapidly vanishing oil spill.

The model showed that the topography in the Gulf had played a vital role. Since the gulf is bounded on three sides by land—north, east and west—the water currents don't flow in a single direction as in river. Instead, the water sloshes around, back and forth, as if it were trapped in a washing machine.

An initial population of bacteria encountered the spill near the BP well, its population grew, and then it was swept away by the ocean currents. But when the water circled back—that washing-machine effect—it was already loaded with these hungry bacteria, which immediately went on the attack again, mopping up another round of hydrocarbons. These repeated forays over the BP well, by the ever-growing bacterial populations, sped up the rate at which the methane and offshore oil got devoured.

Dr. Valentine suggested that oil companies ought to ascertain the currents, water motion and native microbial community in the water before embarking on any major offshore drilling project. "Then, if there is an event, we'd be many steps ahead of understanding where the oil may go and what the environment's response may be," he said.

The research was funded by the National Science Foundation, the Department of Energy and the Office of Naval Research.

Write to Gautam Naik at gautam.naik@wsj.com

Andrew:

GM is our point man for this and at the moment he is on the road for a week or two so this will need to wait until his return.

Thank you,
Marc

Nonsense Arguments About Jobs To view this article, Click Here
Brian S. Wesbury - Chief Economist
Robert Stein, CFA - Senior Economist
Date: 1/9/2012
The better the employment reports get, the more ridiculous the assertions from those who deny the improvement.
Take Friday’s report, which was the best since the economic recovery started. Private payrolls rose 212,000, while the number of hours per worker and earnings per hour went up as well. As a result, total workers’ earnings are more than keeping pace with inflation. Even the unemployment rate went down again and is now at 8.5%, almost a full point below where it was a year ago.
 
These numbers are pretty good. Nonetheless, anyone who stated the obvious, and pointed out the good news, was berated by media and especially in the blogosphere. Our observation is that most of these arguments against optimism are driven by politics and border on the ridiculous.
 
One claim is the numbers are being manipulated by the government to help President Obama…if President Bush was in office, unemployment would be 12%.
 
But if the numbers are being manipulated, they’re doing a pretty poor job. Why not claim a higher growth rate for civilian employment – which usually happens anyhow in normal recoveries – which would let them show some combination of a lower unemployment rate or higher labor force participation rate? And why would they usually have to revise up their payroll numbers after the initial report each month? Wouldn’t they want the good news out as soon as possible? Of course, we point this out knowing full well that the conspiracy crowd already thinks we are part of the conspiracy.
 
Another argument is that the “real” unemployment rate is 15.2%, not 8.5%.  This is a reference to the Labor Department’s U-6 rate, which includes discouraged workers, marginally attached workers, and those working part-time who say they want full-time jobs.  But as we have explained many times before, since its inception in 1994, the “real” unemployment rate (U-6) is always, in both good times and bad, higher than the regular unemployment rate – by between 65-85%.  Right now it’s 79% higher.  In other words, the so called real unemployment rate tells us nothing we wouldn’t otherwise know by just looking at the regular unemployment rate.
 
Others are saying the unemployment rate is down only because people are leaving the labor force. This has resonated lately, because the labor force has contracted by 170,000 in the last two months. But those monthly numbers are volatile and the jobless rate is down 0.9 points from a year ago, during a period when the labor force expanded 780,000, or 0.5%.
 
One recent claim is that a “real” recovery would have 250,000 jobs per month. This is a made up number which means nothing other than “we aren’t there yet.” We all want more growth, not less. But, just because the number of new jobs has not reached a non-scientifically based threshold means nothing.   Let’s not make up reasons to be disappointed when the numbers are getting a little bit better every month.
 
Some pessimists notice that this past month, a job category for couriers & messengers was up 42,000, so that shows some problems when these jobs disappear next month. But the same temporary pop in couriers & messengers happened last December and job creation accelerated this year. Moreover, don’t let that one category deflect attention from the fact that every major category of jobs increased in December, from construction and manufacturing to retail and leisure.
 
We get it. The job market isn’t perfect. We wish we were back at 5% unemployment right now and there are plenty of reasons to point fingers and argue that things should, and could, be better. We do that plenty. But using each monthly employment report as a pretext to put forward spurious  arguments and vent about our national state of affairs, which we all knew about in the days before each report as well, suggests an attempt to politicize the economic data. And as we all know, facts and politics don’t always mix very well.

I'm with ya Doug in my amazement at how divorced "the story" is from reality.

Attorney General Eric Holder is on a legal roll against the 50 states, and 2012 will be the year the courts rule on some of his federal power plays. The first big test comes today when the Supreme Court hears oral arguments in Mr. Holder's challenge to Texas's Congressional redistricting plan. This could be educational.

The 2010 Census gave Texas four new Congressional seats, for a total of 36, and the Republicans who dominate state politics drew up the new lines in a way that maintained the current 10 minority districts and added a new Hispanic "opportunity district," which is one with at least 50% Hispanic population.

Under Section 5 of the 1965 Voting Rights Act, Texas is one of nine states that must have changes in its election laws cleared by a federal court or the Justice Department. Texas opted for the former, and while "preclearance" for the changes was pending in federal court in Washington, a panel of judges in Texas designed an interim electoral map that skewed more favorable to Democrats. Republicans cried foul, and the Supreme Court blocked the map until it rules on the case.

Enter Mr. Holder's Justice Department, which insists that Texas must add more minority-dominated districts to take account of a growing Hispanic population. Civil-rights groups like the NAACP claim that at least three of the four new districts should be minority districts.

That kind of raw proportional representation has already been shot down by the Supreme Court. In 1996's Abrams v. Johnson, the Court ruled that similar claims that a Georgia redistricting had diluted minority voting strength didn't hold water. In the opinion, by Justice Anthony Kennedy, the High Court wrote that when a court is tasked with drawing judicial lines, it "should be guided by the legislative policies underlying the existing plan."

In Texas, the federal district court's intervention goes beyond merely looking at minority representation. Instead of deferring to the maps drawn by lawmakers or making specifically tailored adjustments, the court changed the boundaries of all 36 Congressional districts despite no legal finding of wrongdoing by the legislature's map-makers.

Drawing majority-minority districts was once relatively straightforward, but social and racial progress has made that both less necessary and less realistic. There are fewer inner-city barrios that allow lawmakers to identify geographically and ethnically coherent political districts. The Hispanics who have swelled Texas's population live all over Dallas County, for example. Trying to string them together to achieve an artificial version of racial proportionality devalues the racial integration that has been made in the past four decades.

The Supreme Court will decide what rules the courts should follow, and what deference they owe to the legislature. While the three-judge panel in San Antonio will eventually look into whether the legislature's map violated the Voting Rights Act, that factually intensive analysis hasn't happened yet. In the meantime, the judges should have sought a minimally invasive solution.

Congress has routinely renewed the Voting Right Act, but the racial gerrymanders the law encourages have arguably increased racial polarization while reducing minority influence. In Texas, Democrats hope that more majority-minority districts will elect more Democrats, but this may not enhance minority political clout.

Texas is a largely Republican state and more Hispanics have been elected statewide as Republicans than as Democrats in recent years, including former state supreme court Justice Alberto Gonzales and current Justices Eva Guzman and David Medina. Mr. Holder's preference for a map like the one drawn by the Texas court to stock districts with black or Hispanic voters may help elect another Democratic Congressman or two, but they will have little power if the GOP keeps its U.S. House majority.

As Justice Clarence Thomas noted in his classic dissent in 1994's Holder v. Hall, "few devices could be better designed to exacerbate racial tensions than the consciously segregated districting system currently being constructed in the name of the Voting Rights Act. . . . Our drive to segregate political districts by race can only serve to deepen racial divisions by destroying any need for voters or candidates to build bridges between racial groups or to form voting coalitions."

Redistricting has always been a political process, and unless a court finds a violation of law it owes deference to the elected state legislature. The Justice Department's position is a federal intrusion to elect more Democrats, not improve racial harmony.

By ROBERT BARRO
Until recently, the euro seemed destined to encompass all of Europe. No longer. None of the remaining outsider European countries seems likely to embrace the common currency. Seven Eastern European countries that recently joined the European Union (Bulgaria, Czech Republic, Hungary, Latvia, Lithuania, Poland and Romania) have announced their intention to revisit their obligations to adopt the euro.

Two non-euro members of the EU, the United Kingdom and Denmark, have explicit opt-out provisions from the common currency, and popular opinion has recently turned strongly against euro membership. In Sweden, which lacks a formal "opt-out" provision (but has cleverly refused to fulfill one of the requirements for membership), a November poll on whether to join the euro was overwhelmingly negative—80% no, 11% yes.

In light of the political response to the ongoing fiscal and currency crisis—which is leaning strongly toward a centralized political entity that will likely be even more unpopular than the common currency—I suggest that it would be better to reverse course and eliminate the euro.

When the United Kingdom debated whether to join the path to a single currency in the mid-1990s, my view was that the benefits of euro membership—enhancements for international trade in goods and services and financial transactions—were offset by required participation in its poor social, regulatory and fiscal policies. Still, I thought the U.K. should join if it could get just the common currency.

Now I think that the option of a monetary union without the rest of the baggage is an impossible dream. The single money is inevitably linked to a common central bank with lender-of-last-resort powers. This setup creates important features of fiscal union, showing up recently as bailouts in Greece, Portugal, Ireland, Italy and Spain.

The political reaction at each step of the ongoing crisis has been to strengthen this union—bailout money from the EU and the International Monetary Fund, fiscal involvement by the European Central Bank, and more EU influence on each government's fiscal policies. A common currency loaded on top of a free-trade zone is leading toward a centralized political entity.

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 .Despite some scale benefits from having larger countries, the cost of forcing heterogeneous populations with disparate histories, languages and cultures into a single nation could be prohibitively high.

One legitimate counterexample is to point to the United States. It has prospered with fiscal union, despite the continuing potential for federal bailouts of state governments (such as through explicit rescue programs or the kinds of transfers contained in the stimulus package of 2009-10).

The main saving grace is that, except for Vermont, the states have long histories of balanced-budget requirements. However, with the growing unfunded programs for pensions and health care for state government workers, the balanced-budget requirements have become less meaningful. Structural fiscal problems in the U.S. federal system may eventually become as serious as those in Europe.

The EU specifies with great detail how candidate countries can qualify for euro membership, but it offers no recipe for exit or expulsion. A natural possibility would be to start by throwing out the least qualified members, based on lack of fiscal discipline or other economic criteria. Greece is an obvious candidate—it has been increasingly out of control fiscally since the 1970s. But instead of expulsion, the EU reaction has been to provide a sufficient bailout to deter the country from leaving.

A better plan is to start from the top. Germany could create a parallel currency—a new D-Mark, pegged at 1.0 to the euro. The German government would guarantee that holders of German government bonds could convert euro securities to new-D-mark instruments on a one-to-one basis up to some designated date, perhaps two years in the future. Private German contracts expressed in euros would switch to new-D-mark claims over the same period. The transition would likely feature a period in which the euro and new D-mark circulate as parallel currencies.

Other countries could follow a path toward reintroduction of their own currencies over a two-year period. For example, Italy could have a new lira at 1.0 to the euro. If all the euro-zone countries followed this course, the vanishing of the euro currency in 2014 would come to resemble the disappearance of the 11 separate European moneys in 2001.

A key issue for the transition is to avoid sharp reductions in values of government bonds for Italy and other weak members of the euro zone. After all, the issue that has prompted ever-growing official intervention in recent months has been actual and potential losses of value of government bonds of Greece, Italy and so on. Governments and financial markets worry that these depreciations would lead to bank failures and financial crises in France, Germany and elsewhere.

Worries about values of government bonds are rational because it is unclear whether—even with assistance from the center—Italy and other weak members will be able and willing to meet their long-term euro obligations. A new (or restored) system of national currencies would be more credible, because Italy should be able and willing to meet its obligations denominated in new liras. This credibility underlay the pre-1999 system in which the bonds of Italy and other euro-zone countries were denominated in their own currencies. The old system was imperfect—notably in allowing some countries to have occasionally high inflation—but it's become clear that it was better than the current setup.

My prediction is that an announcement of the new system would raise the value of German bonds, because Germany has strong individual credibility and would no longer have to care for its weak neighbors. Even Italian and other weak-country bonds are likely to rise in value because concerns about individual credibility would be offset by the improved functioning of the overall system.

The euro was a noble experiment, but it has failed. Instead of wasting more money on expanding the system's scope and developing ever larger rescue funds, it would be better for the EU and others to think about how best to revert to a system of individual currencies.

Mr. Barro is an economics professor at Harvard University and a senior fellow of Stanford University's Hoover Institution.

Rick Santorum has social conservatives to thank for his strong showing in Iowa, but his ability to win the GOP nomination and defeat President Obama will hang on his economic message. So it's a good moment to sort the good from the bad in the former Pennsylvania Senator's current agenda and Congressional record.

The good news is that Mr. Santorum is focused on spurring faster economic growth, which is the prerequisite for income gains for all Americans, especially the poor. It's a political mistake to focus on income inequality, because Democrats will always outbid Republicans on wealth redistribution. The only way to trump the politics of envy is with the politics of growth.

***
On that score, Mr. Santorum joins most of the other Republicans who are proposing tax reforms that reduce rates in return for closing loopholes. He proposes a return to the Reagan-era top rate of 28%, and a second rate of 10% for middle-income Americans. He also wants a 12% capital-gains tax, down from 15% today, and half the 23.8% rate that Mr. Obama has promised in 2013.

This beats Mr. Romney, who refuses to propose a cut in individual tax rates lest he be accused of favoring the rich. Mr. Santorum doesn't dodge the class-war argument, which Mr. Obama won't let the GOP nominee dodge in any event. Mr. Santorum was especially effective in Saturday night's debate in making the case that Republicans shouldn't stoop to the Democratic rhetoric of pitting "the middle class" against other Americans.

On the other hand, Jon Huntsman's tax reform is superior because it proposes a lower top rate of 23%, which he'd make possible by stripping out nearly all current deductions. Newt Gingrich proposes a voluntary plan with a 15% top rate. Mr. Santorum wants to eliminate deductions for business and the wealthy, but he'd retain some of the costliest deductions, including those for mortgage interest, charities, health care and retirement savings. A President might have to give away these deductions to get a reform through Congress, but Mr. Santorum has conceded them before the bargaining begins.

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Republican presidential candidate Rick Santorum
.Most disappointing is the Pennsylvanian's proposal to triple the tax credit for children (from $1,000 today), which is a hobby horse of the Christian right. This is social policy masquerading as economics. Unlike a cut in marginal tax rates, a larger tax credit does little for growth because it doesn't change incentives to save, work or invest. It merely rewards taxpayers who have children over those who don't.

Mr. Santorum is essentially agreeing with liberals who think the tax code should be used to pursue social and political goals. Yet a major goal of tax reform is to make the tax code less of a political free-for-all. The best tax code is one that raises the revenue the government needs with the least amount of economic harm and misallocation of resources.

A similar tax favoritism affects Mr. Santorum's proposal to cut the corporate tax rate in half (to 17.5%) for most companies but make it zero for manufacturers. Mr. Santorum recently defended this form of industrial policy by saying that Wal-Mart (his example) didn't warrant a zero rate because it didn't send jobs overseas.

So any company that threatens to move jobs overseas should get a lower rate than a company that keeps jobs in the U.S.? Watch Mr. Obama have fun with that one. A better economic strategy would be to confer the lowest possible tax rate on all U.S. corporations, including the 89% of economic activity in America that isn't manufacturing.

This rhetoric is of a piece with Mr. Santorum's votes on trade, which reveal a protectionist streak. He voted against Nafta and called Pennsylvania a "loser state" under the deal that has done much to lift and integrate the economies of the U.S., Canada and Mexico. He has supported steel tariffs and the 27.5% tariff on China for currency manipulation, which could spark a trade war. The hope is that a President Santorum would represent the economic interests of the nation, not just Pennsylvania, and his platform does call for the ratification of five new trade deals.

On spending, Mr. Santorum had a generally respectable record in his 16 years in Congress. Mr. Romney and others have been hitting him for supporting earmarks, but until the last couple of years you could count on one hand the number of Senators who didn't.

Mr. Santorum was among the architects of the historic Contract with America budget in 1995 (when Newt Gingrich was House Speaker) that helped slow government spending and achieve a balanced budget. He has been especially brave in speaking about the need to reform Social Security, even while representing a state that has the second oldest population after Florida. His vote for George W. Bush's prescription drug bill was a mistake, but then Mr. Gingrich also supported it and RomneyCare in Massachusetts is far worse.

The Santorum platform calls for reducing federal nondefense discretionary spending to 2008 levels through across the board agency cuts, eliminating agriculture and energy subsidies, as well as funding for Planned Parenthood, ObamaCare implementation, and United Nations activities "that undermine America's interests."

He would also join most of the other GOP candidates in sending food stamps, housing payments and Medicaid to the states in the form of a block grant. This is how welfare was reformed, despite wails that it would lead to a "race to the bottom" and hurt the poor. Instead it has been the most successful social-policy reform of the last 30 years.

Overall, we'd score Mr. Santorum's economic agenda as bolder than Mr. Romney's, if not as ambitious as those of Messrs. Huntsman and Gingrich. Judging by this weekend's debates, his elevation to a serious contender has improved the quality of the GOP's economic debate. If Mr. Santorum is going to trump Mr. Romney's money and organization, his best opening is to become the candidate of economic growth.

FDA changing course on antibiotics in livestock
The debate over the drug use in food animals continues as federal regulators tackle the issues of drug-resistance and shorter supplies.
J. Adams, Special to the Los Angeles Times
January 9, 2012

Only 20% of the antibiotics sold in the U.S. are given to people who are sick with bacterial infections, such as ear and urinary tract infections and pneumonia. Most of the penicillin, tetracycline and other antibiotic drugs used in this country are given to livestock that are perfectly healthy.
Farmers have been putting these medicines in animal feed since the 1950s. They say the drugs help protect herds from infectious diseases and help animals grow faster.
But for at least 40 years, the U.S. Food and Drug Administration has been concerned that the widespread practice may be fueling the growth of human pathogens that are no longer vulnerable to doctors' front-line drugs.
In the last few weeks, the U.S. Food and Drug Administration has made two rulings addressing the use of antibiotics in animals that will end up as food on our dinner tables:
• On Dec. 22, the FDA pulled the plug on procedures, begun in 1977, that might have ended the practice of feeding penicillin and tetracycline to livestock.
• On Jan. 4, the agency issued an order that prohibits certain uses, including preventive uses, of another class of antibiotics also used to treat pneumonia and other infections in people.
The two moves may seem contradictory. But the FDA asserts that both decisions were made in the interest of preserving antibiotics that are medically important for humans.
Some public health advocates agree that the latest moves indicate a new willingness by the government to tackle the longstanding issue.
In finally dropping its long-stalled plans to limit the use of penicillin and tetracycline in farm animals, the FDA signaled that it intends "to regulate more than just a few drugs," said Laura Rogers, who directs the Pew Charitable Trusts' campaign on human health and industrial farming. Seen in that light, last week's ruling limiting the use of cephalosporin antibiotics in agriculture "is the first step toward a broader regulatory approach," she said. (The Pew campaign opposes routine use of antibiotics in food animals.)
The science behind antibiotic resistance is a classic story of survival of the fittest. Antibiotics target key life functions in bacteria, killing them or preventing them from multiplying. But individual bugs that survive a drug's assault will grow and multiply, potentially creating a whole population of drug-resistant bacteria.
Resistance to antibiotics is a growing public health problem across the globe. People infected with resistant pathogens tend to get more severely ill and are harder to treat. Antibiotic resistance adds an estimated $20 billion to healthcare costs in the U.S. each year, including longer hospital stays and the need for more expensive drugs, according to the Centers for Disease Control and Prevention.
However, it's not clear how much the use of antibiotics in cattle, pigs, chickens and other animals contributes to problems in people.
Those who oppose the practice of putting antibiotics in animals' food or water point to studies that have found livestock-associated strains of bugs such as salmonella and Staphylococcus aureus in humans.
Decades ago, the FDA commissioned Seattle's public health department to study salmonella and campylobacter found on meat and in people sick with enteritis. In a 1984 report, researchers found that illness-inducing campylobacter was similar to that found on poultry products. In addition, about 30% of bacteria from both sources were resistant to tetracycline.
Eating contaminated meat isn't the only way people can become colonized with antibiotic-resistant bacteria. Those who work with farm animals are also at risk. For instance, a Chinese study published in 2010 found antibiotic-resistant Escherichia coli in animals and farmworkers. The year before, researchers in Iowa reported that they found a livestock-associated strain of antibiotic-resistant staphylococcus in pig farm workers.
The World Health Organization, the American Medical Assn. and other major health groups have denounced the practice of feeding human antibiotics to animals. The mere threat that agricultural use could cripple drugs for people is reason enough to take action, they say.
Advocates of the practice refer to scientific reviews that discount the risk to human health. A 2004 paper in the Journal of Antimicrobial Chemotherapy argued that cross-contamination between farm animals and people is a two-way street, with most antibiotic-resistant disease stemming from human use of these drugs. In any event, the authors wrote, illness from bacteria on meat can be prevented with proper cooking — even if the bacteria are resistant to drugs.
Blanket regulations limiting how the drugs are used on animals would remove valuable tools from the veterinarian's medical bag, according to the American Veterinary Medical Assn. Using the drugs prophylactically allows farmers and ranchers to prevent or control disease outbreaks, especially when animals are kept in close quarters. If drugs are only given to animals after they are visibly ill, disease can spread quickly and risk the lives of an entire herd or flock.
There's little dispute that livestock animals carry antibiotic-resistant organisms. But there's all sorts of barriers that prevent those bugs from infecting humans, said Dr. Liz Wagstrom, chief veterinarian for the National Pork Producers Council. They'd have to contaminate the meat at slaughter, survive cooking and be ingested in a large enough dose to make someone ill.
In ending its long-stalled initiative to reconsider penicillin's and tetracycline's use in agriculture, the FDA said the "notices of opportunity for a hearing" issued in 1997 were so old that they were essentially useless. Though there was evidence back then that the practice fuels antibiotic resistance, new data would have to be taken into account for such a decision to be made today.
At a minimum, any effort to move forward at this point would have to consider other classes of antibiotics that have become popular since the 1970s and include a rationale for which ones should be targeted, according to the agency.
The FDA's move may have been prompted by a lawsuit filed by advocacy groups including the Natural Resources Defense Council and the Food Animal Concerns Trust. Convinced that feeding antibiotics to animals is a major public health problem, they were trying to force the FDA to move forward with its plans — not abandon them altogether.
"It's the FDA's overcautious attitude," said Steven Roach, public health program director for FACT. "If anything we have more evidence now than we did in 1977. And they had enough evidence to proceed back then."
The drugs that were affected by the FDA's decision are among the oldest around. Tetracycline tops the list of most popular antibiotics, with more than 4 million kilograms used in food animals per year, according to 2009 data collected by the FDA. Penicillin comes in fourth, with about 610,000 kilograms of the drug used each year. (Both figures include drugs used on healthy animals as well as to treat those that are sick.)
Both drugs still are widely used by pork producers but in very specific ways, Wagstrom says. For instance, penicillin (usually in combination with other antibiotics) is fed to weanling pigs because it stimulates growth at this early stage in life.
How antibiotics promote growth is not entirely understood. The drugs may affect gut bacteria in a way that permits food nutrients to be better absorbed, or they may suppress low-level disease, according to Dr. H. Morgan Scott, a professor at Kansas State University's College of Veterinary Medicine in Manhattan, Kan. "If they're growing faster, some people would argue they must be healthier."
The FDA has made other moves to restrict antibiotic use in animals. In 2003, the agency began requiring drug companies to do a risk assessment of drugs given to animals as part of the overall approval process. However, those rules don't apply to older drugs like penicillin, Roach said.
The FDA is also developing guidelines for the "judicious use" of antibiotics in livestock. These guidelines, first made public in July 2010, are still in draft form. The agency hasn't set a timeline to finalize them, although it's considered a priority, according to FDA spokeswoman Stephanie Yao.
But those guidelines will only be voluntary, which is why watchdog groups tried to force the FDA to move forward with the decades-old rules about penicillin and tetracycline, Roach said.
The lawsuit brought by the NRDC, FACT and others to force the FDA to take regulatory action against antibiotics in animal feed is ongoing.
Meanwhile, Rep. Louise Slaughter (D-N.Y.) has introduced legislation to restrict the use of medically important antibiotics in agriculture. The Preservation of Antibiotics for Medical Treatment Act would require the FDA to re-review approvals for drugs currently allowed in animal feed. Slaughter re-introduced the bill last March.

For bandwidth issues IIRC see some of the older posts in the SCH Internet technology thread.

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.smaller Larger  'We have a stake not just in the stability of nations, but in the self-determination of individuals." That was President Obama at the State Department last May, rolling out his own version of the freedom agenda for the Muslim world. So why has the Administration been virtually silent when it comes to one of the most notorious and long-running abuses of power taking place in the Muslim world today—this one in our good friend and ally, Malaysia?

The abuses in question concern Malaysian opposition leader Anwar Ibrahim, who on Monday faces a verdict—and potentially years of jail time—on dubious sodomy charges. Mr. Anwar first went through this charade as a deputy prime minister in the late 1990s, when he fell out with then-Prime Minister Mahathir Mohamad during the Asian financial crisis, was savagely beaten by police and ultimately sentenced to prison on sodomy and corruption charges.

Mr. Anwar spent six years in prison. In 2004 the sodomy charges were overturned by the country's highest court—a year after Mr. Mahathir had left office. Yet Mr. Anwar was again served with sodomy charges four years later, after the ruling UMNO party had lost its two-thirds majority and the opposition seemed close to assembling a parliamentary majority.

The current case is even flimsier than the last one. It is based mainly on the word of one accuser who, as it so happened, had met with then-deputy prime minister, now Prime Minister, Najib Razak days before the alleged incident. Doctors at two hospitals could find no evidence of rape in the aftermath of the alleged incident. Nonetheless, political observers anticipate a guilty verdict.

This is happening in the context of growing discontent among Malaysians with UMNO's ruling order, and Mr. Najib's ambivalent attempts at political reform. But if that's reminiscent of the unhappiness that presaged the Arab Spring, so too is the don't-rock-the-boat attitude of the Obama Administration.

Malaysia is supposedly a moderate Muslim country and a useful regional counterweight to China, and the President was full of praise for Mr. Najib's "great leadership" when they last met in November. As for Mr. Anwar, the State Department has publicly offered no more than boilerplate about his case. Perhaps quiet diplomacy is now at work on Mr. Anwar's behalf, but that kind of diplomacy is fine only as long as it produces results.

In the meantime, Malaysian democracy could benefit from a sign that the U.S. is not indifferent to Mr. Anwar's legal ordeal or to the political system that has allowed it to continue. U.S. interests could benefit as well. "Failure to speak to the broader aspirations of ordinary people will only feed the suspicion that has festered for years that the United States pursues our own interests at their expense," said Mr. Obama in May. Mr. Anwar's case gives the President a chance to show that he meant what he said.

By FERGUS CULLEN
New Hampshire primary voters like to pretend they don't pay attention to what happens in Iowa. Nonsense. New Hampshire voters react to the Iowa caucus results, confirming or correcting them as needed. South Carolinians will do the same in turn.

And thank goodness. It's easy to disparage the way we nominate presidential candidates and the role the early states play, but it's like what Winston Churchill said of democracy as a whole: We have the worst nominating system imaginable, except for all the others.

The process works. Some of the candidates may get away with fooling some of the voters and some of the media for some of the time, but not for long. They have to come out from behind the 30-second ads and look voters in the eye. Along the trail from Des Moines to Manchester to Charleston, candidates are vetted, frauds are exposed, and the resulting nominee emerges stronger, a more accurate reflection of the voters' mood and will. Isn't that the whole point of the nominating process?

Campaigns in the early states are changing. This cycle has seen fewer town hall meetings and less retail campaigning than in the past. Candidates have found it easier, cheaper and safer to try to limit their campaigning to debates, cable-TV appearances with friendly hosts, and Facebook.

Who can blame them? Herman Cain, Michele Bachmann and Rick Perry all shot up in the polls while almost entirely avoiding shaking hands with New Hampshire voters.

But shunning the people soon caught up with them. Legend had it that Mr. Perry was a great retail campaigner; if so, precious few New Hampshire voters witnessed that skill in person. I estimate that fewer than 2,500 Granite Staters saw Mr. Perry in person this entire campaign. Newt Gingrich has been seen by just a few more, which is part of why he's fading.

The rapid rise and fall of candidates this primary season has made it difficult to distinguish the presidential campaign from a reality TV show. But wasn't C-SPAN's "Road to the White House" series, in which a cameraman and a boom mic follow a candidate around without a script, the original reality TV show?

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Presidential hopeful Rick Santorum (left) on Thursday at Tilt'n Diner in Tilton, N.H.
.The truth is that campaigns are always changing and evolving. In 1964, Henry Cabot Lodge topped Barry Goldwater and Nelson Rockefeller to win the New Hampshire primary through a write-in campaign fueled by a couple of then-unprecedented statewide mailings. In 1980, videotape of Ronald Reagan taking charge of a debate in Nashua by thundering, "I'm paying for this microphone!" went viral without the benefit of YouTube or popular cable television. Pat Buchanan didn't need his primitive website or email to win the 1996 primary.

What hasn't changed is that the early states in the nominating process serve a national purpose by reducing the presidential race to a human scale. Candidates still have to interact with the people they seek to lead, and ordinary citizens still have opportunities to take the measure of candidates in person.

To be sure, it's a tradition more honored in the breach than the observance. The mythological primary character does exist—the flinty Yankee wearing a plaid shirt who rises at a town hall meeting to ask a candidate a tough, well-informed question—but only a small minority of voters attend events with candidates, and fewer still assess multiple candidates in person. Almost all questions at town hall meetings fall into standard, predictable categories, tailor-made for prepared two-minute answers from the candidates. Most New Hampshire primary voters get most of their information the same way voters in other states do: through their televisions.

The point is that voters can meet candidates if they want to, and it's critically important that our nominating process retain that. Early state old hands advise presidential candidates to run as though they are running for governor, and the most successful candidates do. Lesser known candidates with smaller war chests find a level playing field in the early states and an equal opportunity to earn support. Rick Santorum's success in Iowa and Jon Huntsman's foothold in New Hampshire are based on having done more events in those respective states than anyone else. Not every candidate will go home happy with the outcome, but none can depart the race feeling that they didn't get their shot. In the early states, it's still true that anyone can run for president.

Those states, and New Hampshire in particular, remain the petting zoo of presidential politics where voters can see, touch and smell the animals. Everything later is the circus, with voters sitting as spectators in the stands, watching the jumbotron. It's a process that has served the nation well.

Mr. Cullen is a former chairman of the New Hampshire Republican Party and editorial page columnist for the New Hampshire Union Leader.

By MACKUBIN THOMAS OWENS
The president has now outlined a strategy to guide the substantial cuts to the defense budget that will occur over the next decade. Those cuts are significant: at least $487 billion over the next decade, and twice that amount if the automatic spending reduction triggered by the failure of the deficit reduction super committee to reach an agreement goes into effect.

The new strategy envisions a regional focus on the Asia-Pacific and a shift from a two-war capability to a "win-spoil" plan that maintains the capability to fight and win one regional war while spoiling the military aspirations of another adversary in a different theater. The Army will be reduced to 490,000 troops from 570,000 and the Marines to 175,000 from 202,000 over the next few years while air and naval assets will be maintained in order to optimize operations in Asia-Pacific, primarily a maritime theater.

Critics argue that the budget cuts undermine the ability of the United States to defend itself. That's not altogether true. The cuts are necessary for economic reasons and the U.S. will still spend a great deal of money on defense. The real danger is that the administration's new strategy to guide the cuts undermines strategic flexibility, leading the country down a dangerous path it has traversed before: a primary reliance on a single military capability or a focus on a single region.

The administration's focus on Asia-Pacific and reduction of ground forces in favor of air and naval forces are both manifestations of what the late political scientist Samuel P. Huntington called "strategic monism," the domination of defense policy by a single strategic concept or regional focus. This approach presupposes an ability to predict and control the actions of possible enemies, discounting the commonsense view that the world is dynamic and characterized by uncertainty. Instead it seeks to impose a single vision on the U.S. defense establishment. If this vision is correct, things will be fine. If not, the U.S. may lack the ability to respond adequately to an unexpected event.

There is an old saying that "any war plan that depends on the cooperation of the enemy is likely to fail." This is the fatal flaw of strategic monism. The record reveals that defense planners have not been particularly successful in predicting the future. The U.S. has suffered a significant strategic surprise once a decade since 1940: Pearl Harbor, the North Korean invasion of South Korea, the Soviet H-bomb test, the Soviet reaction to the Arab-Israeli War of 1973, the fall of the Shah of Iran, the collapse of the Soviet Union and, most recently, 9/11.

The risks of the administration's new strategy are illustrated by the "New Look" strategy pursued by the Eisenhower administration of the 1950s. Its focus on long-range strategic air power resulted in strategic inflexibility: The U.S. largely lacked the ability to respond to threats at the lower end of the spectrum of conflict. Realizing this, our adversaries responded by moving away from conventional confrontation toward insurgencies and "peoples' wars." This deficiency led to the replacement of the New Look by the strategy of Flexible Response in the 1960s.

Ironically, after the Gulf War of 1991, some defense analysts resurrected the idea that a nearly exclusive reliance on air power could solve the defense dilemmas the U.S. faced. The wars in Iraq and Afghanistan disabused us of this notion.

The administration's new strategy stands in contrast to "strategic pluralism," an approach that calls for a wide variety of military forces and weapons to meet a diversity of potential threats. Given the geopolitical position of the U.S. requiring that it plan to respond to threats around the globe, strategic pluralism seems more appropriate.

This more balanced approach presupposes an uncertain security environment. Despite our desires, there is much in this world that we do not and cannot know in advance, and threats to our interests are not necessarily predictable.

For instance, an assumption underlying the reduction of ground forces is the expectation that the U.S. will not be undertaking expensive, troop-intensive counterinsurgency campaigns such as those waged in Afghanistan and Iraq. Force planners made a similar assumption after Vietnam. The assumption was wrong then and most likely is wrong now.

A more balanced approach would hedge against uncertainty by maintaining a force capable of responding across the entire spectrum of conflict, building on the existing capabilities of a variety of forces—air, space, naval, land and cyber—to meet challenges to U.S. interests that may arise across the globe.

At the same time, retaining multiple capabilities complicates planning by potential adversaries. The smaller the number of options a force structure can generate, the easier it is for an enemy to develop a low-cost counter. That is what our enemies have done in the past, and it is what they will do in the future, especially if we make it easy for them.

Mr. Owens is professor of national security affairs at the Naval War College, editor of Orbis, the quarterly journal of the Foreign Policy Research Institute, and author of "US Civil-Military Relations After 9/11: Renegotiating the Civil-Military Bargain" (Continuum, 2011).

WASHINGTON — A nearly two-month lull in American drone strikes in Pakistan has helped embolden Al Qaeda and several Pakistani militant factions to regroup, increase attacks against Pakistani security forces and threaten intensified strikes against allied forces in Afghanistan, American and Pakistani officials say.
The insurgents are increasingly taking advantage of tensions raised by an American airstrike in November that killed two dozen Pakistani soldiers in two border outposts, plunging relations between the countries to new depths. The Central Intelligence Agency, hoping to avoid making matters worse while Pakistan completes a wide-ranging review of its security relationship with the United States, has not conducted a drone strike since mid-November.
Diplomats and intelligence analysts say the pause in C.I.A. missile strikes — the longest in Pakistan in more than three years — is offering for now greater freedom of movement to an insurgency that had been splintered by in-fighting and battered by American drone attacks in recent months. Several feuding factions said last week that they were patching up their differences, at least temporarily, to improve their image after a series of kidnappings and, by some accounts, to focus on fighting Americans in Afghanistan.
Other militant groups continue attacking Pakistani forces. Just last week, Taliban insurgents killed 15 security soldiers who had been kidnapped in retaliation for the death of a militant commander.
The spike in violence in the tribal areas — up nearly 10 percent in 2011 from the previous year, according to a new independent report — comes amid reports of negotiations between Pakistan’s government and some local Taliban factions, although the military denies that such talks are taking place.
A logistics operative with the Haqqani terrorist group, which uses sanctuaries in Pakistan to carry out attacks on allied troops in Afghanistan, said militants could still hear drones flying surveillance missions, day and night. “There are still drones, but there is no fear anymore,” he said in a telephone interview. The logistics operative said fighters now felt safer to roam more freely.
Over all, drone strikes in Pakistan dropped to 64 last year, compared with 117 strikes in 2010, according to The Long War Journal, a Web site that monitors the attacks. Analysts attribute the decrease to a dwindling number of senior Qaeda leaders and a pause in strikes last year after the arrest in January of Raymond Davis, a C.I.A. security contractor who killed two Pakistanis; the Navy Seal raid in May that killed Osama bin Laden; and the American airstrike on Nov. 26.
Pakistan ordered drone operations at its Shamsi air base closed after that airstrike, but C.I.A. drones flying from bases in Afghanistan continue to fly surveillance missions over the tribal areas. The drones would be cleared to fire on a senior militant leader if there was credible intelligence and minimal risk to civilians, American officials said. But for now, the Predator and Reaper drones are holding their fire, the longest pause in Pakistan since July 2008.
“It makes sense that a lull in U.S. operations, coupled with ineffective Pakistani efforts, might lead the terrorists to become complacent and try to regroup,” one American official said. “We know that Al Qaeda’s leaders were constantly taking the U.S. counterterrorism operations into account, spending considerable time planning their movements and protecting their communications to try to stay alive.”
C. Christine Fair, an assistant professor of political science at Georgetown University who just returned from a month in Pakistan, put it more bluntly: “They’re taking advantage of the respite. It allows them to operate more freely.”
Several administration officials said Saturday that any lull in drone strikes did not signal a weakening of the country’s counterterrorism efforts, suggesting that strikes could resume soon. “Without commenting on specific counterterrorism operations, Al Qaeda is severely weakened, having suffered major losses in recent years,” said George Little, a Defense Department spokesman. “But even a diminished group of terrorists can pose danger, and thus our resolve to defeat them is as strong as ever.”
Analysts say the hiatus coincides with and probably has accelerated a flurry of insurgent activity and new strategies.
In the past week, leaflets distributed in North Waziristan announced that the Afghan Taliban and Al Qaeda had urged several Pakistani militant groups to set aside their differences and some commanders have reportedly asked their fighters to focus on striking American-led allied forces in Afghanistan.
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The Pakistani groups include the Pakistani Taliban, an umbrella group led by Hakimullah Mehsud that has mounted attacks against the Pakistani state since the group was formed in 2007. The new council also includes the Haqqani network and factions led by Maulvi Nazir of South Waziristan and Hafiz Gul Bahadur of North Waziristan, which already target NATO soldiers and have tacit peace agreements with the Pakistani military.
In telephone interviews, some Pakistani militants said the purpose of the agreement was to settle internal differences among rival factions and improve the image of the Taliban, which has been tarnished because of the increasing use of kidnapping and the rise in civilian killings.
Other analysts say that the Afghan Taliban are also feeling the pinch of American-led night raids and other operations across the border. They said the Taliban needed the militants in Pakistan’s tribal region to focus more on helping to launch a final offensive in Afghanistan, in hopes of gaining leverage before any peace talks and the ultimate withdrawal of most American forces from Afghanistan by 2014.
One of the main drivers of the accord was Sirajuddin Haqqani, the leader of the Haqqani network, prompting some Pakistani analysts to reason that the Pakistani Army had also prodded the creation of the council, or shura, to maintain its leverage in any peace negotiations. Last summer Adm. Mike Mullen, who was then chairman of the Joint Chiefs of Staff, called the Haqqanis “a veritable arm” of Pakistan’s main military spy agency.
“No agreement is ever permanent in frontier politics, and it’s all very complicated,” said one American government official with decades of experience in Pakistan and its tribal areas.
Stuck in a stalemate in the lawless borderlands with this array of militants are 150,000 Pakistani troops. A recent report by an Islamabad-based research organization, the Pak Institute for Peace Studies, said that militant-based violence had declined by 24 percent in the last two years. But it also concluded that terrorist attacks in the Federally Administered Tribal Areas, or FATA, and Khyber-Pakhtunkhwa Province increased 8 percent in 2011 from the year before.
“The security situation remained volatile as militants dislodged from their strongholds constantly managed to relocate to other parts of the FATA,” the report said.
In a sign of the shifting insurgent tactics, the number of suicide bombings in the country declined to 39 through November, compared with a high of 81 in all of 2009, according to the Pakistani military.
The number of attacks from homemade bombs, however, increased to 1,036 through November, compared with 877 for all of 2009. More than 3,500 Pakistani soldiers and police officers have been killed since 2002.
One senior Pakistani Army officer with experience in the tribal areas said that insurgents had devised increasingly diabolical triggers and fuses for bombs.
Unlike Americans, Pakistani soldiers still drive in pickups or carriers with little protection. “The effects are devastating,” said the officer, who spoke on the condition of anonymity. “Vehicles are basically vaporized.”
“The Pakistani Army is overstretched, and that’s clearly had an impact on morale,” said Maleeha Lodhi, a former Pakistani ambassador to the United States. “But we have to maintain the pressure on the militants.”

WASHINGTON — The federal agency in charge of deportations is conducting a far-reaching training course to push immigration enforcement officers and prosecutors nationwide to focus their efforts on removing immigrants convicted of crimes.
The training course is the clearest sign yet that administration officials want to transform the way immigration officers work, asking them to make nuanced decisions to speed deportations of high-risk offenders while halting those of illegal immigrants with clean records and strong ties to the country. The policy is President Obama’s most ambitious immigration initiative before the November elections, senior administration officials said.
But in a new sign of the deep dissension over immigration, the union representing some 7,000 deportation officers of the agency, Immigration and Customs Enforcement, known as ICE, has so far not allowed its members to participate in the training. Without the formal assent of the union, the administration’s strategy could be significantly slowed for months in labor negotiations.
Chris Crane, the president of the union, the National ICE Council, has fiercely criticized the strategy, saying it amounts to orders from ICE officials for agents not to enforce the law. In Congressional testimony, Mr. Crane accused the administration of tailoring its enforcement practices to win support from immigrant communities for Mr. Obama’s re-election.
“Law enforcement and public safety have taken a back seat to attempts to satisfy immigrant advocacy groups,” Mr. Crane told a House Judiciary subcommittee in October.
Department of Homeland Security officials say the training seminar, although only half a day, is central to bringing all ICE officers on board for an effort that they say will significantly raise the numbers of convicted criminals among deportees and is expected to lead in coming months to unprecedented suspensions of deportations of tens of thousands of illegal immigrants.
Virtually all ICE commanding officers and prosecutors have gone through the training course and are working on the new strategy, Homeland Security Department officials said. But because of the silence from the ICE Council, a local of the American Federation of Government Employees, the officials will miss their Jan. 13 goal for completing the nationwide training blitz, which began in November.
Mr. Crane has channeled his criticisms primarily through Republican leaders in Congress, working with Representative Lamar Smith of Texas, the chairman of the House Judiciary Committee. Calling the administration’s plan “backdoor amnesty,” Mr. Smith said last week that evidence Mr. Crane presented to the committee showed that directives from ICE officials for agents to use discretion in enforcement decisions had “undermined the agency’s credibility and mission.”
The National ICE Council faces a deadline late this month to say whether it will demand negotiations over the training, the officials said. Mr. Crane did not respond to repeated e-mail requests over several months for comment.
On another side, the administration is facing intense pressure from Latino leaders and immigrant organizations to begin halting deportations.
The cornerstone of the policy is a June 17 memorandum by John Morton, the director of ICE, in which he laid out a list of no fewer than 31 factors that ICE officers should weigh when deciding whether to proceed with a deportation. Peter S. Vincent, ICE’s top lawyer, added further guidelines on Nov. 17.
With slide shows and chalk talks on a dozen hypothetical immigration cases, the training seminar challenges officers to decide which foreigners should be deported, using prosecutorial discretion to make more complex decisions than they have in decades. It instructs agents to focus on the worst offenders, including criminal convicts, gang members and foreigners who came back after being expelled. Other groups of immigrants — elderly people, children, military veterans, college students and parents of young citizens — are low priorities who can be allowed to stay, even if they are here illegally. A New York Times reporter sat through an abbreviated version of the seminar.

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Homeland Security Secretary Janet Napolitano said the policy was based on existing statutes and was intended to make good use of strained resources. With each deportation costing at least $23,000, she said, immigration agencies have money for 400,000 removals each year, a goal that the Obama administration has met in each of the past three years. But an estimated 11 million immigrants live here illegally.
The training asks ICE agents what they should do, for example, with a young illegal immigrant turned over to the agency after being arrested by a state trooper for driving without a license. She has been living in this country since 1993 and has an infant son, an American citizen because he was born here. But she lied to ICE officers, failing to tell them she had a conviction for shoplifting in 1995.
Answer: She is not a threatening criminal and may still be nursing her American baby. Officers should close her deportation case.
How about the migrant who has been living here since he crossed the Southwest border illegally in 1996? He failed to appear for a crucial immigration court hearing back then. But he has no criminal record, and he coaches soccer at the school where his twin daughters, both citizens, are enrolled.
Answer: This case, too, should be closed.
Then there is the man from an Asian Pacific island, a legal resident of the United States since 1984 who even served two distinguished combat tours in Iraq. But he left the military and is now finishing a six-year prison sentence for a federal sex-trafficking felony.
Answer: Despite his service, because of his grave sex offense he loses his resident status and will be sent by ICE to his birth country.
Cases against illegal immigrants who win favorable prosecutorial discretion will be closed but not canceled, so ICE can easily reopen them. Mr. Morton said the immigrants would remain in “legal limbo,” not gaining any legal immigration status.
Mr. Crane told Congress that the Morton directives presented enforcement agents with “a roller coaster of arrest authority that has changed from month to month, week to week and at times from day to day.” He said some agents were afraid to make any arrests.
It is not clear how deeply the union’s resistance reaches into ICE ranks. ICE officials say many field agents have been drawn to the professional appeal of the high-profile anticrime operations against foreign street gangs, drug dealers and sex offenders that the agency is conducting ever more frequently.
“Our folks understand that we have limited resources and we have to focus more than ever on our priorities,” said Chris Shanahan, the ICE field office director who oversees deportation operations in New York City, where all supervisors have had the training.
“What I see from my officers,” Mr. Shanahan said, “is that they understand that criminal aliens and national security threats should be taken into custody and removed before a single mother, a pregnant woman or someone with small United States citizen children.”

WSJ
By AUSTAN GOOLSBEE

   - FWIW, this is the editorial page publishing an opposing view and these are the slanted underpinnings for a partisan stump speech written by an insider and co-conspirator.  He is highly credentialed but this is not a serious academic economic analysis.

MARC:  Exactly so.



"Each candidate decried the rise of government spending and wants to cut taxes."

    - FALSE and its a theme here.  It's the tax RATES that they want to cut, not cut revenues.  A professor of economics at the Univ. of Chicago knows the difference.  Shame on him.

MARC:  I agree with the point, but this meme runs deep.   As the rather good Wesbury piece I posted yesterday points out, the payroll tax holiday will not produce much economic effect because it is MARGINAL tax rates that matter.  Under Boener’s leadership in the House, the Reps have already folded on this subject so if we are keeping score, the Reps are poorly positioned at the moment to make Doug’s point.



"Again and again they noted that spending under President Obama rose to 25% of the economy in 2009, the highest in decades and well over the 20%-21% norm of the last 30 years." ( - TRUE!)

"To hear the GOP candidates tell it, this fact explains the deficit, explains America's long-run fiscal problem, and explains why new taxes cannot be tolerated. Congressional Republicans have the same outlook. The deficit is up thanks to government spending, so we must cut spending right now in every form."

    - FALSE,  Everyone of them knows that the under-performance of the private economy is the central problem.  Resources taken from the private economy for the public sector are just one of the causes of that under-performance.  Taxes and especially overly burdensome regulations comprise most of the rest.

"Yet the long-run fiscal problem facing the country—which is real—has almost nothing to do with the reasons that the deficit is currently large or that spending is abnormally high. They are high for the same reason taxes are abnormally low: because of the economic downturn. We should debate the real issues, not try to pretend the recession never happened."

    - FALSE!  What Republican is pretending the recession never happened?  Prof. Goolsbee, OTOH, pretends that the economic stagnation is like weather; this recession is like a rain certain to be followed by sunshine just by waiting or doing more of the same.  This recession/stagnation was and is a GOVERNMENT CAUSED DOWNTURN and as a top adviser, former chief economic adviser, he was right there at the table where they failed to identify either the correct cause or solution to the mess.

MARC:  I suspect that if the Dems were to point out that tax revenues as a % of GDP are several percentage points below usual, even for during a recession, and that much of the deficit is due to this factor and but for this the deficit numbers would be well within normal ranges, the Reps would be sore pressed to give a snappy coherent answer.  With the exception of Ron Paul the Reps have conceded Keynesian logic that some deficit spending is necessary during a recession.

"The Congressional Budget Office forecast a $1.2 trillion deficit before the Obama administration even came into office."

    - DECEPTIVE to say the least.  Yes the pundits and voters will look at the calendar days of the Obama Occupy the White House movement but everyone who was alive and paying attention knows that domestic power in Washington DC changed hands in the Nov 2006 election.  The CBO forecast he sites is from the Pelosi-Reid-Obama-Hillary-Biden 'non-partisan' CBO scoring the budget passed by the Pelosi-Reid-Obama-Hillary-Biden congress signed by Bush 'before the Obama administration even came into office'.   The downturn was under THEIR watch as well, including SEN. Obama always supporting or voting with the majority, and the emergency measures coming into the 2008 election and during the transition period were made in 100% consultation and agreement with the incoming Obama administration. 

MARC:  I’m not sure that this answers the point as perceived by most voters— many/most of them tend to say “Obama inherited a really bad situation.”

“Spin that some other way if you would like, but the investors and employers in the economy were wide awake heading into the tax rate increases and the host of new programs and regulations impending beyond their worst nightmare of imagination when the asset selloff began and when the collapse of housing and employment ensued.

MARC:   THIS is a VITAL point and it is a HUGE failing of the Reps that it is not part of the narrative. 

"The stimulus added only around $250 billion a year, and more than one-third of that came from tax cuts, especially the tax credit in the stimulus bill's "Making Work Pay" provision."

    - This is 4 years later! "ONLY" a quarter trillion/yr. is a TRILLION in 4 years and it wasn't a stimulus if it didn't stimulate and it doesn't count the QEx, nationalization of autos and host of other excesses.  If you didn't know that then, surely you know that now as the chief outgoing economic adviser.  And not all tax cuts are created equal.  Some stimulate economic activity and others give up revenues without improving incentives whatsoever.  Some are targeted to constituent voting groups and some apply to all, especially those inclined to hire and produce.  Guess which types the Obama administration working the first 2 years with a 100% Dem congress chose??

MARC:  Again we see the weakness of participating in non-marginal rate tax cuts and the weakness of Bush and the Reps failing to make his cuts permanent in the name of “fiscal responsibility” thereby conceding the Dem meme that rate cuts equal revenue cuts.   Also, have the Reps effectively put out their number of what Baraq has spent?  NO!!!  Quickly now, can anyone here (and we are all well above average—“No brag, just fact”) give me the total of Baraq’s stimulus spending?

"Most of the increase in the deficit during a downturn doesn't come from new policies in Washington. The deficit rises because both spending and taxes automatically adjust when the economy struggles. Unemployment insurance payments rise and more people qualify for Medicaid and food stamps. Incomes fall so people pay less taxes."

    - A theoretically truth, but FALSE in this case.  Spending sold as "emergency" and "temporary" in fact became the new benchmark used by same author and the administration and its allies to assail any reduction from emergency levels an act of war against the 99% and the weakest among us in particular.  Proof: After all the budget hysterics and pretend "cuts" of the past year under bitterly divided government, spending was up another 5% for the year.  What part of that spending was emergency?  None of it.  It was the why-waste-a-crisis crowd intentionally transforming American dependency on government.  BTW, we aren't in a recession (and the downturn did come from new government policies).  We are in the new American economy operating exactly as it should be under the disincentives scheme designed by Prof. Goolsbee et al and legislated and signed by the side he is defending.

MARC:  Again we see the evil Orwellian effects of baseline budgeting in clouding clear thinking!!!  Until the Reps (and  the Tea Party too!!!) find a way to get this point across, I fear we are doomed.  That said, the challenge of crisply answering Goolsbee’s Keynesian logic here remains.

"It's completely normal that spending rises during big downturns. The government's share of the economy jumped significantly during the big recessions in the 1970s and '80s. As the economy grows back to health, the government share of the economy will fall (and many analysts forecast just that for the coming year)."

    - WHY should the economy grow back to health.  Doing more and more of the same and expecting a different result is WHAT?? (definition of insanity?)

MARC:  The argument Baraq will make is that things were really bad so they’re taking longer than usual to turn around but now we are, as Doug notes, out of recession and things are headed in the right direction, albeit slower than we would like.   How do we crisply answer this in a fifty words or less sound bite?

"The same dynamic applies to tax revenues. You would think that—using the same logic they apply to the rise of government spending—the GOP candidates would be trumpeting the last three years as one of the greatest tax cutting periods of the century."

    - BLATANTLY FALSE!!  If anyone would believe this drivel then I would put it with falsely shouting fire in a crowded theater - perhaps not protected speech.  Do they need that level of LIE to run on their record?  Once again, a fully educated economist intentionally confuses tax rates with tax revenues for political deception purposes.  The frontrunners are NOT trying to lower government revenues.  Maybe Ron Paul would lower revenues AND balance the budget, but that blows the Professor's first premise that he (blindly) can't see any daylight between any of them.

"The nonpartisan Tax Policy Center's data predict that in 2011 taxes will have fallen more as a share of national income than during almost any other comparable period in U.S. history (including under Ronald Reagan) and may hit their lowest level since World War II: 14.4% of GDP, compared with the more than 18% average of the last 30 years. Individual income taxes may hit their lowest level as a share of income since 1950 and corporate income taxes the lowest since 1936.

The deficit shot up in basically equal measure from taxes falling and spending rising. Spending rose to 25% of GDP from 20.5% in the recession and soon it will fall back down. Taxes fell to 14.5% of GDP from 18.5% and will also return to more normal levels."

    - Again, he implies a bad economy was happenstance rather than admit it was a government policies caused event.  We avoided large downturns for almost a quarter century by keeping mostly in place the Reagan pro-growth agenda, even with reform in the late 80s, smaller increases under HW Bush and the early Clinton years.  But this economy IS the new normal.  What changed?  He doesn't say here but if pressed I'm sure he would say Bush's fault.

MARC:  Here Goolsbee makes the assertion that concerns me the most.  Revenues as a % of GDP in fact ARE down a lot, far more than usual in a recession if I am not mistaken.  Superficially it will sound plausible for Obama to say in a debate?  What is our sound bit answer to this???

"The true fiscal challenge is 10, 20 and 30 years down the road. An aging population and rising health-care costs mean that spending will rise again and imply a larger size of government than we have ever had but with all the growth coming from entitlements—while projected federal revenues as a percentage of GDP after the rate cuts of the 2000s will likely remain below even historic levels of 18%."

    - FALSE.  The true challenge is get off the slow growth or no-growth trajectory of the current policies and to minimize the amount of debt we accumulate during this wasted 4-8 years of 'transformation' BEFORE the worsening demographics fully set in.

MARC:  With the exception of the final clause this is quite TRUE.  Entitlements and Rising Health Care costs ARE the true challenge-- and the fact of it is that the Reps have avoided talking about how to bring down entitlement spending.  Quick, someone name me Rep proposals other than that by Paul Ryan or the joint plan by Ryan and Dem ____ (about which I have posted here).   Why are none of the candidates, including my man Newt, using the Ryan plan as a talking point?

"To hear the Republican candidates, you would think our problems were about discretionary spending running wild."

    - FALSE.  Does anyone remember the sensation of 9-9-9? That was all about unleashing economic growth running wild.  Or Pawlenty's plan highly acclaimed by Prof Taylor of Stanford, or Rick Perry's plan endorsed by Steve Forbes, or Gingrich's plan - all about regenerating economic growth and innovation, or Huntsman's or even Romney's Plan.  The centerpiece of NONE of them is slashing spending or starving seniors, our single most prosperous demographic group.

... Iowa showed us a series of candidates trying to outdo one another with condemnation for the short-term rise in spending while simultaneously proposing tax policies that would add trillions to the long-term deficit.

    - FALSE and when will we truly be rid of the proven false doctrine of static scoring?!?!  Growth at this point in the Reagan recovery was close to 8% and revenues in the 1980s DOUBLED! Good riddance to you and your team.

MARC:  The key word in Goolsbee’s assertion here is “discretionary” and he is right, the Reps are, as I asserted a moment ago, talking as if discretionary spending is the issue—with Ron Paul being the exception.  Only he is talking about eliminating entire departments.  Perry can’t even remember his three, and Romney and Newt want to keep the Dept. of Education and others of that ilk.

Mr. Goolsbee, a professor of economics at the University of Chicago's Booth School of Business, was chairman of President Obama's Council of Economic Advisers from 2010 to 2011.

    - Can you imagine investing your family's life savings in sending your kid to one of the top schools in the country and finding out this is the level of analysis being taught?  Did the professor writing about FISCAL challenges really not know that REGULATIONS are a tax on the economy or simply run out of space?  Did he not know or just wish to not say that under his watch 77,000 pages of new regulations were issued?  Did he not know that Obamacare impending is a tax on our economic growth and perhaps the final nail in the coffin of new hiring?  Did he forget to notice the differences between these candidates and his policies prohibited energy development and blocked pipelines that are taxes on our growth?  Did he not know that the perpetual cloud of expiring Bush-Obama tax rate cuts is a huge tax on our economy that yields all the destruction and no new revenues and same for the Harry Reid surcharge proposal on millionaires, the 24 new taxes in  Obamacare: http://www.atr.org/comprehensive-list-tax-hikes-obamacare-a5758.  Republican are proposing plenty of remedies starting with canceling his new programs and reversing most of their new regulations, the question is whether anyone is listening and whether people would really prefer just more of the same policies, but expecting a different result.

MARC:  Are we happy with how the Rep candidates are communicating this message?

All The Emperors Are Naked - by Brian S. Wesbury
 
 
Hyperbole Alert!  Washington’s latest legislation – the one extending the payroll tax cut – may be the worst piece of legislation ever passed.

I told you to get ready for hyperbole.

It clearly isn’t the most damaging piece of legislation ever passed.  There are many others that were worse.  But, this one little piece of legislation is the epitome of political nonsense.

It’s not that Democrats and Republicans can’t work together.  It’s because they are working together.  Getting something done is a religion in DC.  The House passed this bill by unanimous consent.  Not one (1) single member objected.

Many Republicans supported the bill because they thought they would lose votes in upcoming elections if they didn’t support something.  Leading journalists told them so.  Democrats got their payroll tax cut and extended unemployment benefits.  They will call this “stimulus” and take credit for a growing economy.

But the bill, when looked at from an economic point of view makes absolutely no sense.  Each of its five parts exposes a problem with Washington.  Let’s look at them one by one.

The Payroll Tax Cut

So many people have been erased from the income tax rolls that cutting income tax rates does nothing for them.  This leaves payroll taxes as the only populist tool for politicians.

But, a 2% cut in Social Security tax rates does not boost economic output because it is not a cut in the top marginal tax rates.  This means the government must make up any revenue loss by cutting spending (which it never does), borrowing more or raising taxes on someone else.  But, taking money from one group to give to another is a zero sum game, at best. 

In the year since the 2% tax cut was initiated in January 2011, and with the Fed super easy, consumption increased at an annual rate of 4.3% – unchanged from the 4.2% growth rate for all of 2010, the year prior to the cut.  The tax cut did nothing.  Only marginal tax rate cuts will increase growth.

Unemployment Benefits Extension

This is the one that always trips up politicians because no one wants to be on record against it.  Yet, it is clear that two-year unemployment benefits have done little to create jobs.  This is a European-style, Keynesian pump-primer.  It has never worked in Europe, and it won’t work in the US.  The reason unemployment is so high these days is because government is so big.  The US needs to cut spending, not increase it.

Increased Fees on Fannie Mae and Freddie Mac

Every bill Congress passes is supposed to be “paid for” by offsetting cuts in spending, or tax hikes. This explains the two month extensions.  It’s cheaper to fund than a full year.

But even two month cuts need to be paid for, so Congress levied more fees on Fannie Mae and Freddie Mac.  So what do fees on mortgage providers have to do with social security tax cuts?  The answer is: nothing.

Social Security tax cuts should be paid for by cutting future social security benefits.  If Congress was honest about this, Americans would probably not support a tax cut today for lower benefits tomorrow.  It would be called eating our seed-corn.  Unfortunately, we already ate it (we spend every dime Social Security brings in).  So this tax cut just makes our already underfunded plan even more underfunded.  Congress avoids this by putting more fees on home ownership. 

But raising fees on Fannie and Freddie makes no sense.  These companies are already losing money.  Congress is not going to put these funds into escrow to pay for future losses…it is going to spend the money today.  Future taxpayers will still be on the hook for losses.  The fees also perpetuate the myth that Congress knows how to price mortgages by setting fees at the perfect level.  They should be closing down Fannie and Freddie, not making them a bigger part of government.

The “Doc Fix” 

Back in 1997, Congress passed a balanced budget act that was supposed to control spending, partly by holding back the growth rate of Medicare spending.  Medicare payments to doctors were supposed to be held down by a formula.  In the first few years, these reductions were small, but Congress avoided them anyway and by passing a “doc fix” every year, kept kicking the can down the road.

So, today, in order to comply with these cuts (which have never been allowed to happen), doctor reimbursements need to fall by a whopping 27.4%.  If this were to happen, doctors who treat Medicare patients would be up in arms.  No Congress-person wants that – it’s not good for business.

So, Congress used this bill to push off these cuts again.  It also “kicked the can” on eleven other items as well.  Along with the “doc fix,” Congress also made sure cuts to ambulance and mental health add-ons, bone mass measurement, outpatient treatments, and other varied items, did not happen.

This behavior, which everyone in Washington knows happens every year, is about to go into hyper-drive.  President Obama promised roughly $500 billion of future Medicare cuts would help pay for Obamacare.  These future cuts are based on formulas very similar in design to the 1997 bill.  So, why would anyone believe Congress won’t do the same thing all over again?  When faced with the choice of cutting spending or making a constituent mad…Congress always chooses the constituents…and not the ones who pay for it all.

But it gets even worse.  Every year, the Congressional Budget Office (CBO) assumes that Congress will follow through on its 1997 agreement when it scores the budget.  So, the deficit forecast for the next decade assumes a cut in doctor reimbursements that everyone knows won’t happen.  When the budget deficit rises more than expected, everyone in Washington expresses amazement, regret and surprise and then blames it on the private sector and the rich for not paying enough taxes.  Is this a messed up system or what?

The Keystone Pipeline

Republicans used this bill to force President Obama to make a decision within 60 days on the Keystone Pipeline extension.  This project would have already been put in place if private businesses, and private money, were the only deciding factors.  But, politicians in the US are subsidizing unprofitable solar and wind power, while holding-up and penalizing traditional, privately-funded, carbon-based fuel sources.  From an economic point of view the pipeline is a no-brainer, making this the only economically sane part of this bill.  But, it still highlights the broken nature of Washington.

The Worst Bill in History

Any business that ran this way would be out of business.  Government, because it has so much control and power, can avoid the inevitable for a little longer.  But eventually the game comes to an end.  And that’s exactly what is happening in Europe right now.  The Welfare State has come to its logical conclusion – bankruptcy.

Spain, for example, just admitted its deficit is 8.5% of GDP, not the 6% that it was publicizing.  So, it is proposing a package of tax hikes and spending cuts equal to 1.5% of GDP.  This will leave the deficit at 7% of GDP, even though it had promised under new rules to get it down to 4.5%.

Governments seem unwilling to deal with issues that are relatively straight-forward.  It’s not hard to understand.  Spending needs to be paid for by taxes, but taxes undermine the incentives to produce and invest and push business to other countries.  Eventually government spends so much that the economy cannot support it (no matter how much tax rates rise) and bond buyers go on strike.  Many European countries have reached that point.

The United States is not there yet.  However, it is slowly and surely approaching that day if nothing changes.  Politics as usual is not working.  It produces inane bills like the one described above.  Every piece of the bill just passed points to a government that has run out of any self control.

Somehow it is easier to keep spending…and Congress acts like no one will ever figure it out.  It links Social Security tax cuts to mortgage fees, it ignores rules that it previously agreed to and promised to follow through on, it stimulates an economy that does not need to be stimulated.  It continues programs that don’t work.  And the entire time it is doing this it keeps telling us that without government everything would fall apart.

It’s a broken system and the only common theme that runs through it is a considerable effort to get re-elected.  It is becoming more clear by the day, that all the Emperors are naked…there are no more clothes.

The good news is that the electorate is waking up, the European Welfare State is failing and history suggests the US will find a way to correct its course before it’s too late.

Click here for a printable PDF.
 

Very interesting; good follow up to what I posted!

I gather there are two debates this weekend , , ,

http://money.cnn.com/2012/01/05/smallbusiness/doctors_broke/index.htm?hpt=hp_t3&hpt=hp_c1

Non-farm payrolls increased 200,000 in December To view this article, Click Here
Brian S. Wesbury - Chief Economist
Robert Stein, CFA - Senior Economist
Date: 1/6/2012
Non-farm payrolls increased 200,000 in December and were up 192,000 including revisions to October/November.  The consensus expected a gain of 155,000.
Private sector payrolls increased 212,000 in December.  Revisions to October/November subtracted 3,000, bringing the net gain to 209,000.  December gains were led by couriers/messengers (+42,000), retail (+28,000), health care & social work (+29,000), restaurants/bars (+24,000), and manufacturing (+23,000). The largest decline was for temps (-8,000).
The unemployment rate dropped to 8.5% from 8.7% in November.
 
Average weekly earnings – cash earnings, excluding benefits – rose 0.2% in December and are up 2.1% versus a year ago.
 
Implications:  This is the best employment report since the start of the recovery.  The labor market still has a long way to go before it gets back to normal, but the pace of improvement has clearly accelerated.  Private payrolls increased 212,000 in December (209,000 including revisions to prior months).  Every major category of private payrolls increased in December.  Perhaps even more important was an increase in the average workweek to 34.4 hours from 34.3.  That might not seem like a lot, but it translates into 320,000 jobs.  In other words, had employers kept the workweek unchanged, they would have needed to hire more than 500,000 workers for the month instead of just 212,000.  This is an important signal of more job gains to come.  In 2011, nonfarm payrolls were up an average of 137,000 per month.  We anticipate an increase around 180,000 for 2012.  Some pessimists say a “birth/death” model is artificially inflating payroll gains, but December’s birth/death adjustment was -11,000, the first negative adjustment for any December in the last nine years.  The other big headline for today is that the unemployment rate ticked down to 8.5% in December, the lowest since March 2009 and almost a full percentage point lower than a year ago.  The December drop was due to a solid 176,000 increase in civilian employment.  Although the November jobless rate was revised to 8.7% from 8.6%, that change is deceiving.  Unrounded, November’s jobless rate was revised to 8.65% from 8.64%, so there was no significant change.  The bottom line is that hours worked in the private sector are up 2.4% in the past year, while average hourly earnings are up 2.1%.  This translates into a 4.5% gain in cash earnings (excluding fringe benefits, like health insurance).  We all wish it were faster, but incomes are outpacing inflation.  The pessimists banking on a weak economy in 2012 ought to re-check their assumptions.

IIRC that was the reason his original staff left him for , , , Rick Perry.

At present, the four players are Mitt, Newt, Santorum, and Ron Paul. 

Mitt:  Too tepid, too timid, to used to being bullied by Democrats;

Santorum:  While I am comfortable around social conservatism, I think many independents will find RS concerning on these issues and Baraq will whip his folks into a frenzy over them.  He certainly seems to be a big government conservative.  And, no way can he beat Baraq;

RP: As previously discussed-- absolutely great on economics, spending, taxes, freedom, the Fed, but devastating on foreign affairs.  The left will join him in cutting the military, then hang him out to dry over entitlements;

Newt:  Flawed as he may be, for his great strengths I go with Newt.  He needs the money now or else he will be too badly wounded by the time South Carolina arrives and by default we will have Romney.

Made another donation to Newt today.

I'm thinking Romney or Santorum would have a hard time answering this in debate-- how about each of us?
==================
WSJ
By AUSTAN GOOLSBEE
The Iowa caucuses presented the full range of views of the Republican hopefuls. When it came to fiscal strategy, however, there was almost no daylight among them. Each candidate decried the rise of government spending and wants to cut taxes.

Again and again they noted that spending under President Obama rose to 25% of the economy in 2009, the highest in decades and well over the 20%-21% norm of the last 30 years.

To hear the GOP candidates tell it, this fact explains the deficit, explains America's long-run fiscal problem, and explains why new taxes cannot be tolerated. Congressional Republicans have the same outlook. The deficit is up thanks to government spending, so we must cut spending right now in every form.

Yet the long-run fiscal problem facing the country—which is real—has almost nothing to do with the reasons that the deficit is currently large or that spending is abnormally high. They are high for the same reason taxes are abnormally low: because of the economic downturn. We should debate the real issues, not try to pretend the recession never happened.

The Congressional Budget Office forecast a $1.2 trillion deficit before the Obama administration even came into office. The stimulus added only around $250 billion a year, and more than one-third of that came from tax cuts, especially the tax credit in the stimulus bill's "Making Work Pay" provision.

Most of the increase in the deficit during a downturn doesn't come from new policies in Washington. The deficit rises because both spending and taxes automatically adjust when the economy struggles. Unemployment insurance payments rise and more people qualify for Medicaid and food stamps. Incomes fall so people pay less taxes.

It's completely normal that spending rises during big downturns. The government's share of the economy jumped significantly during the big recessions in the 1970s and '80s. As the economy grows back to health, the government share of the economy will fall (and many analysts forecast just that for the coming year).

The same dynamic applies to tax revenues. You would think that—using the same logic they apply to the rise of government spending—the GOP candidates would be trumpeting the last three years as one of the greatest tax cutting periods of the century.

The nonpartisan Tax Policy Center's data predict that in 2011 taxes will have fallen more as a share of national income than during almost any other comparable period in U.S. history (including under Ronald Reagan) and may hit their lowest level since World War II: 14.4% of GDP, compared with the more than 18% average of the last 30 years. Individual income taxes may hit their lowest level as a share of income since 1950 and corporate income taxes the lowest since 1936.

The deficit shot up in basically equal measure from taxes falling and spending rising. Spending rose to 25% of GDP from 20.5% in the recession and soon it will fall back down. Taxes fell to 14.5% of GDP from 18.5% and will also return to more normal levels.

The true fiscal challenge is 10, 20 and 30 years down the road. An aging population and rising health-care costs mean that spending will rise again and imply a larger size of government than we have ever had but with all the growth coming from entitlements—while projected federal revenues as a percentage of GDP after the rate cuts of the 2000s will likely remain below even historic levels of 18%.

To hear the Republican candidates, you would think our problems were about discretionary spending running wild. Yet, if you take out the aging of the population and health-care cost increases, government spending is going to shrink over the next decade. A cap on government spending at past levels and a balanced-budget constitutional amendment would force huge cuts to Social Security and Medicare.

So let's talk about the trade-off between new revenues versus cuts to entitlements. We have known about that issue for decades. We also know it would be much easier to address if the economy were growing again.

The election should lay out each candidate's fiscal grand bargain and growth strategy. Let us compare them. They matter. This could make up the heart of a historically important presidential contest. Instead, Iowa showed us a series of candidates trying to outdo one another with condemnation for the short-term rise in spending while simultaneously proposing tax policies that would add trillions to the long-term deficit.

Mr. Goolsbee, a professor of economics at the University of Chicago's Booth School of Business, was chairman of President Obama's Council of Economic Advisers from 2010 to 2011.

President Obama yesterday put in a rare appearance at the Pentagon, flanked by the four service chiefs and his Secretary of Defense. Saying that now is the time to cash in a peace dividend, he unveiled plans for a significantly slimmed-down military. This dance was choreographed to convey strength. Everything else about it showed how domestic entitlements are beginning to squeeze the U.S. military.

This self-inflicted attack on defense comes at a strange time. True, the U.S. cut deeply after World War II, Korea, Vietnam and the Cold War—and in each case came to regret it soon enough when new threats emerged. But peace doesn't characterize our time. Mr. Obama yesterday wielded his familiar line that "the tide of war is receding," which will please his antiwar base but will come as news to the Marines in Afghanistan or the Navy ships patrolling the tense Strait of Hormuz.

The Pentagon shouldn't be immune to fiscal scrutiny, yet this Administration has targeted defense from its earliest days and has kept on squeezing. The White House last year settled with Congress on $450 billion in military budget cuts through 2021, on top of the $350 billion in weapons programs killed earlier. Defense spending next year will fall 1% in nominal terms. The Pentagon also faces another $500 billion in possible cuts starting next January under "sequestration," unless Congress steps in first.

Taken altogether, the budget could shrink by over 30% in the next decade. The Administration projects outlays at 2.7% of GDP in 2021, down from 4.5% last year (which included the cost of Iraq and Afghanistan). That would put U.S. outlays at 1940 levels—a bad year. As recently as 1986, a better year, the U.S. spent 6.2% of GDP on defense with no detrimental economic impact.

What's different now? The growing entitlement state. The Administration is making a political choice and sparing Social Security, Medicare and Medicaid, which are set to hit nearly 11% of GDP by 2020. And that's before $2.6 trillion for ObamaCare, which will surely cost more.

Enlarge Image

CloseAssociated Press
 
President Barack Obama speaks at the Pentagon.
.These entitlements are already crowding out spending on defense and thus reducing America's global standing, following the tragic path that Europe has taken. The difference is that Europe had the U.S. military in reserve. Who will backstop America?

We're told that Defense Secretary Leon Panetta, who came into office last summer, says he doesn't want to go down in history as the man who "hollowed out" America's military. But the security trade-offs foisted on him by the White House will leave the military a less formidable, ready and dominant force in a still very dangerous world.

Part of the problem is that military personnel costs are exploding on pace to exceed the entire defense budget by 2030, according to Andrew Krepinevich of the Center for Strategic and Budgetary Assessments. It's hard to make the political and moral case to reduce benefits for veterans and soldiers, but here's where Mr. Panetta could show mettle on Capitol Hill, especially by reforming military health care. The bulk of any defense budget is better spent on equipment, training and research.

Specific cuts will be spelled out in detail in the next Pentagon budget. The Navy, Air Force and Marines are flying old planes and waiting on the next generation F-35 Joint Strike Fighter jet, which comes with stealth technology. Previous Pentagon chief Bob Gates justified ending F-22 purchases by pointing to the F-35. But now the F-35 will likely be further trimmed and delayed.

After a decade of war, all the services need to replace worn-down equipment. U.S. nuclear submarines, missiles and bombers purchased during the Reagan buildup are reaching the end of their service lives. They need to be replaced, but they probably won't be soon.

Mr. Panetta and the Chairman of the Joint Chiefs, General Martin Dempsey, tried gamely yesterday to dress up these cuts not as a drawdown but as a "strategic shift." The Pentagon will spend less on the infantry to nation-build—now so unpopular—and will switch instead to defend the Pacific and new threats from cyberwarfare and in space.

But where are the resources to match the ambitions, such as new ships to patrol the Pacific? The planned reduction in troop strength is an "acceptable risk" (in General Dempsey's words) since this Administration doesn't plan to fight ground wars or pursue any Afghan-style "stabilization" missions. Too bad Commanders-in-Chief don't get to choose history's next surprise.

The real message to the world is that the Administration wants to scale back U.S. leadership. This was part of the rationale behind the White House's reluctance to take the initiative in the Middle East last year, as well as the attempts to mollify Iran's mullahs and Russia's Vladimir Putin. Now the Administration plans to draw down troops and America's profile in Africa, Latin America and Europe. The Navy can easily match Iran's threats in the Persian Gulf now, but what about in 10 years?

President Obama ended his remarks yesterday by quoting Dwight Eisenhower on "the need to maintain balance in and among national programs." The line comes from his 1961 Farewell Address, better known as the "military-industrial complex" speech. Mr. Obama's new defense posture brings to mind another Eisenhower line, offered two years earlier: "Weakness in arms often invites aggression."