Nobody used that language when the entire coastal establishment called George Bush and “idiot” on every TV program and in every newspaper every day. But when lawmakers lobbying for health care reform during the August recess were met by disgruntled crowds, the Democratic National Committee called it the act of "desperate Republicans” and their well-funded allies organizing “angry mobs" to "destroy President Obama." House Speaker Nancy Pelosi called those attending the "Town Halls" Nazis, saying they were "carrying swastikas and symbols like that." The official MSNBC State News Network spoke of “hooligans and extremist” at the events, even though no SS officers were sighted.

ABROAD: Locked into its worst recession in post-war history, Japan, the world’s second largest economy, remains paralyzed by its domestic politics. As the LDP carries on with business as usual, the opposition is now in disarray, raising the prospect of the chance for much-needed change to slip away once again.

Bu Dennis Mullin

Japan's political world was recently rocked by the twin resignations of the opposition Democratic Party of Japan's leader, Ichiro Ozawa, and his top lieutenant, Yukio Hatoyama. Mr. Ozawa has spent the last 15 years forming a succession of parties in a quest to dethrone the Liberal Democratic Party from its position atop Japanese politics -- a spot it has held for the past half-century.

SCANDAL: Just when it looked like he would achieve his goal, a fundraising scandal involving his top aide has apparently brought him down. Whether his foibles will doom his party's chances to reshape Japan's political map remains to be seen.

Michael Auslin of the American Enterprise Institute, in a new analysis, notes that Japan's political system has been in flux for the better part of the last decade and a half, in no small part due to Ozawa. The LDP received an electoral boost during the 2001-2006 administration of the popular Junichiro Koizumi, who as recently as this month topped a public opinion poll that asked who should become Japan's next prime minister. Since Mr. Koizumi stepped down, the LDP has hemorrhaged support, with two prime ministers in a row resigning due to political paralysis and scandal.

LOW SUPPORT: Current Prime Minister Taro Aso saw his public support plummet to less than 20 percent until Ozawa's scandal hit in March. Since then, Aso's numbers have inched up (yet are still under 30 percent), while Ozawa's have dropped. Ozawa resigned in the name of "party unity" and to boost the chances that the DPJ will win a majority later this year in Japan's powerful lower house of parliament.

If this happens, the DPJ would control both houses and gain the premiership. Political pundits claim Ozawa's resignation is just what the DPJ needs to put a fresh face at the top of its ticket and appeal to voters tired of the same old clubby politics. Yet Japan's political future may not be decided so simply, for several reasons.

First, no one is sure how Japan's voters will react to Ozawa's resignation over the medium-term. They may be more likely to view the DPJ as little more than a clone of the LDP, with the same corruption problems, lack of stable leadership and inability to focus on the real issues of concern to the public, such as health, education and economic opportunity.

FEW DIFFERENCES: Indeed, one of the DPJ's main problems is that it was founded and largely populated by ex-LDP members, and many Japanese voters see it as little different from the ruling party. Ozawa labored in recent years to change that impression, largely through an aggressive platform of support for working families, shrinking the income gap, and talking about greater independence from the United States. That platform helped the DPJ take control of the upper house of parliament in July 2007, thus bringing about a period of political paralysis in Japan.

Secondly, the DPJ itself is riven with factions, largely between the older guard represented by Messrs. Ozawa and Hatoyama, young turks like Seiji Maehara and Akihisa Nagashima and former members of Japan's Socialist Party. While ex-DPJ head Katsuya Okada is considered a front-runner to replace Ozawa, party members locked out of the ruling circle until now could also challenge for the leadership.

UP FOR GRABS: Moreover, without Ozawa at the helm, the party's platform may be up for grabs, potentially diluting its message to voters. The DPJ also has had trouble in the past fielding candidates in all precincts, and its current woes may make it difficult to attract fresh talent.

No one, however, should think that Ozawa's resignation is the break for which the ruling LDP has been waiting. The LDP has been on the defensive for the past two years and shows no signs of finding new leadership or policies that appeal to the average voter. Aso has a hold on power within his party largely because no one else is interested in captaining a ship so obviously taking on water.

Few analysts believe the LDP can maintain its two-thirds majority in parliament in elections this year. It will either slip into the minority or maintain a bare majority that will be flummoxed by the stonewalling tactics the DPJ has used effectively since 2007.

LUKEWARM: It may yet turn out that the thought of a new DPJ leadership is enough to drive a majority of voters over to the opposition. However, Japan's electorate might also become lukewarm to both parties and vote to largely keep the system as it is. That would be the worst possible outcome, for it would mean continued policy paralysis in the world's second-largest economy and an endless focus on winning the next election.

Auslin concludes that Japan, which is in the midst of its worst recession in postwar history, desperately needs aggressive action to stabilize its economy. It also needs to reassure its partners, especially the U.S., that it will remain engaged in regional and global issues, carry through commitments to support military realignment with the U.S., and play a role in global economic recovery. If the new leader of the DPJ can do that, then his party very well might win a victory that puts Japan on a new road.

GLOBAL ECONOMY: The conventional wisdom that America is finished is coming under question as we noted recently. Part of that has to do with signs that the recession is easing, and part lies in concerns that others may be in even worse shape. Now many other economists are joining the contrarian chorus.

By Dennis Mullin

As the world economy gradually returns to something approaching normality after the catastrophe triggered by the Lehmans bankruptcy on Sept. 15 last year, the prognosis for the long-term have centered on the collapse of America as Venezuela’s Hugo Chavez likes to crow, to the emergence of China as the primary superpower, as People’s Daily trumpets.

MODELS: As ecomonic models are never good at predicting turning points in cycles, to assess the long-term political and ideological impact, it makes more sense to consider two scenarios. In the first, which has dominated thinking throughout the crisis, the deflationary forces of the credit crunch prevail and the world sinks into a recession lasting many years, with unemployment soaring to levels last seen in the 1930s.

In that case, this crisis really will mark the end of U.S. dominance, not only as a global power, but also as an economic model and source of political inspiration. But rather than shifting the mantle of global leadership to China or maybe Europe -- if we take seriously the triumphalist rhetoric of President Sarkozy after the London G20 summit about the “death of the Anglo-Saxon model” -- a prolonged recession would usher in chaos.

ALTERNATIVES: China is far too poor, too technologically backward and too inward-looking to be a credible economic leader and its social arrangements are hardly a model for the democratic world. As for Europe, it would suffer even more institutional damage than the U.S. from a prolonged depression, as it did in the 1930s. In short, the widely predicted depression would lead to what some investors describe as the “Mad Max World”: a state of global anarchy in which the only assets worth owning would be farmland and oil wells - and the guns and ammunition to protect them.

London Times columnist Anatole Kaletsky, notes that the alternative possibility is that monetary and fiscal stimulus succeed and the world returns to normal growth and moderate unemployment within a year or so. To judge by much commentary, this benign outcome is unlikely. But on Wall Street and in much of Asia it is becoming the mainstream assumption, he says.

UPHEAVALS: The benign scenario should be the focus of all policy discussions for two reasons, he says. First, because economic theory tells us that fiscal and monetary reflation will succeed and hints of success are starting to show. Second, if the world is about to collapse into anarchy and nothing can be done, there is no benefit in predicting it. If, on the other hand, the end of the world can be averted, acting on this assumption, will make recovery more likely. But big upheavals may lie ahead.

The financial crisis has profoundly changed US politics. It has convinced voters of the need for government, and of leaders who believe in government. With the election of an administration dedicated to competent government, things have improved, as voters have noticed, he continues. Thus U.S. and European ideology have moved closer together. Many Bush Administration foreign, social and environmental policies have been reversed, sending the signal that Americans no longer live on a different planet from the rest of the world. As a result, America has become more attractive as a political model throughout the democratic world.

STRONGER: Less obviously, the U.S. economic model, far from being discredited, may be strengthened by this crisis. If the U.S. returns to growth much faster than Europe and Japan, the crisis will reaffirm the resilience of Anglo-Saxon capitalism, provided that it is not confused with totally deregulated market fundamentalism.

Moreover, the crisis may strengthen the U.S. economy structurally by promoting President Obama's agenda of clean energy and healthcare reform. Developing new energy sources will play to America's advantage in technology, while correctly-managed healthcare reform could reduce the cost burden that has crushed many U.S. industries.

For Europe, the crisis has exacerbated three distinct problems that Kaletsky notes. First, global deleveraging is having a bigger impact on Germany than on the U.S. or Britain. Second, Eastern Europe faces a catastrophic financial crisis, like the one in Thailand and Indonesia 12 years ago. Third, the euro has been transformed into a source of vulnerability rather than strength because Europe's sovereign borrowers can no longer print their own money, making them prone to default in the same way as state and local governments in the U.S.

PERFECT STORM: He goes on: The result of this perfect storm is that Europe will probably become more inward-looking. The question of more or less Europe will have to be debated anew, as maintaining the status quo may not be compatible with the survival of the euro or the new financial regulations now widely demanded.

In Central Europe the painful consequences of the harsh economic reforms imposed by Germany, the European Commission or the IMF in exchange for financial support will probably strengthen the influence of Russia, which handled its own financial crisis surprisingly well.

Turning to Asia and China, does this crisis mark the moment of transition from U.S. to Chinese dominance? Probably not. For Japan even more than Germany, the crisis has been a total disaster and the concept of export-led growth has been discredited.

China's leaders understand the dangers of excessive dependence on exports and are trying to shift emphasis to domestic growth. But this will slow productivity growth and economic development and it is not clear if China's authoritarian politics can adapt to a society emphasizing consumption rather than production.

DOLLAR’S ROLE: Finally, what of the dollar's status as a reserve currency? Those who argue that U.S. budget deficits and monetary expansion will destroy its international status must point to another currency underpinned by stronger fiscal and monetary foundations. At present, there is no such currency, except possibly the Chinese yuan, which is already artificially grossly over-valued cannot be legally owned by foreigners.

Those who argued that the dollar would collapse because of the global crisis forgot that to sell one currency it is necessary to buy another. The currency game is not a beauty contest but an ugly contest, in which investors must choose the currency that is least ugly.
In some ways this is true of global geopolitics.

The crisis may have revealed grave flaws in the U.S. economic and political models. But the weaknesses in other countries have become even more obvious. The logical conclusion is that President Obama's post-crisis America will be more powerful and influential than it was under President Bush, Kaletsky concludes.
  -- Read More >

Japan's political world was recently rocked by the twin resignations of the opposition Democratic Party of Japan's leader, Ichiro Ozawa, and his top lieutenant, Yukio Hatoyama. Mr. Ozawa has spent the last 15 years forming a succession of parties in a quest to dethrone the Liberal Democratic Party from its position atop Japanese politics -- a spot it has held for the past half-century.

SCANDAL: Just when it looked like he would achieve his goal, a fundraising scandal involving his top aide has apparently brought him down. Whether his foibles will doom his party's chances to reshape Japan's political map remains to be seen.

Michael Auslin of the American Enterprise Institute, in a new analysis, notes that Japan's political system has been in flux for the better part of the last decade and a half, in no small part due to Ozawa. The LDP received an electoral boost during the 2001-2006 administration of the popular Junichiro Koizumi, who as recently as this month topped a public opinion poll that asked who should become Japan's next prime minister. Since Mr. Koizumi stepped down, the LDP has hemorrhaged support, with two prime ministers in a row resigning due to political paralysis and scandal.

LOW SUPPORT: Current Prime Minister Taro Aso saw his public support plummet to less than 20 percent until Ozawa's scandal hit in March. Since then, Aso's numbers have inched up (yet are still under 30 percent), while Ozawa's have dropped. Ozawa resigned in the name of "party unity" and to boost the chances that the DPJ will win a majority later this year in Japan's powerful lower house of parliament.

If this happens, the DPJ would control both houses and gain the premiership. Political pundits claim Ozawa's resignation is just what the DPJ needs to put a fresh face at the top of its ticket and appeal to voters tired of the same old clubby politics. Yet Japan's political future may not be decided so simply, for several reasons.

First, no one is sure how Japan's voters will react to Ozawa's resignation over the medium-term. They may be more likely to view the DPJ as little more than a clone of the LDP, with the same corruption problems, lack of stable leadership and inability to focus on the real issues of concern to the public, such as health, education and economic opportunity.

FEW DIFFERENCES: Indeed, one of the DPJ's main problems is that it was founded and largely populated by ex-LDP members, and many Japanese voters see it as little different from the ruling party. Ozawa labored in recent years to change that impression, largely through an aggressive platform of support for working families, shrinking the income gap, and talking about greater independence from the United States. That platform helped the DPJ take control of the upper house of parliament in July 2007, thus bringing about a period of political paralysis in Japan.

Secondly, the DPJ itself is riven with factions, largely between the older guard represented by Messrs. Ozawa and Hatoyama, young turks like Seiji Maehara and Akihisa Nagashima and former members of Japan's Socialist Party. While ex-DPJ head Katsuya Okada is considered a front-runner to replace Ozawa, party members locked out of the ruling circle until now could also challenge for the leadership.

UP FOR GRABS: Moreover, without Ozawa at the helm, the party's platform may be up for grabs, potentially diluting its message to voters. The DPJ also has had trouble in the past fielding candidates in all precincts, and its current woes may make it difficult to attract fresh talent.

No one, however, should think that Ozawa's resignation is the break for which the ruling LDP has been waiting. The LDP has been on the defensive for the past two years and shows no signs of finding new leadership or policies that appeal to the average voter. Aso has a hold on power within his party largely because no one else is interested in captaining a ship so obviously taking on water.

Few analysts believe the LDP can maintain its two-thirds majority in parliament in elections this year. It will either slip into the minority or maintain a bare majority that will be flummoxed by the stonewalling tactics the DPJ has used effectively since 2007.

LUKEWARM: It may yet turn out that the thought of a new DPJ leadership is enough to drive a majority of voters over to the opposition. However, Japan's electorate might also become lukewarm to both parties and vote to largely keep the system as it is. That would be the worst possible outcome, for it would mean continued policy paralysis in the world's second-largest economy and an endless focus on winning the next election.

Auslin concludes that Japan, which is in the midst of its worst recession in postwar history, desperately needs aggressive action to stabilize its economy. It also needs to reassure its partners, especially the U.S., that it will remain engaged in regional and global issues, carry through commitments to support military realignment with the U.S., and play a role in global economic recovery. If the new leader of the DPJ can do that, then his party very well might win a victory that puts Japan on a new road.
  -- Read More >

GEOPOLITICS: The landmark election of a child of immigrants from Indonesia and Kenya to the Presidency is sign enough of the changes that are taking place in the world. The globalization of the plant is continuing apace, financial crises and modern- day piracy aside, and as a result, the role of America as the world’s sole superpower will wane.   -- Read More >

GEOPOLITICS: The landmark election of a child of immigrants from Indonesia and Kenya to the Presidency is sign enough of the changes that are taking place in the world. The globalization of the plant is continuing apace, financial crises and modern- day piracy aside, and as a result, the role of America as the world’s sole superpower will wane.


By Dennis Mullin

American economic and political clout will decline over the next two decades and the world will be more dangerous, with food and water scarce and advanced weapons plentiful, a new National Intelligence Council analysis "Global Trends 2025" says.



The outlook is intended to inform U.S. President-elect Obama of factors that will influence global events. It is based on a year-long global survey of experts and trends by U.S. intelligence analysts.



GREAT RISKS: The U.S. dollar's role as the world's major currency would weaken to become a "first among equals," the report said, and "The next 20 years of transition to a new system are fraught with risks." The assessment was more pessimistic about U.S. influence and the potential for conflict than the last outlook for 2020.



Thomas Fingar, chairman of the intelligence council and deputy national director of intelligence said harmful outcomes were not inevitable. "It is not beyond the mind of human beings, or political systems, (or) in some cases (the) working of market mechanisms to address and alleviate if not solve these problems," Fingar told reporters. "If that happens, we could have a better world in 2025."



China and India, following a "state capitalism" economic model, are likely to join the U.S. atop a multi-polar world and compete for influence, the report said.

Russia's potential is less certain, depending on its energy wealth and internal investment. But Iran, Turkey and Indonesia are also seen gaining power.



POTENTIAL FOR CONFLICT: A world with multiple power centers has historically been less stable than one with a single or two rival superpowers, and there is a growing potential for conflict, the report said. Global warming will be felt, and water, food and energy constraints may fuel conflict over resources.



"Strategic rivalries are most likely to revolve around trade, investments and technological innovation and acquisition, but we cannot rule out a 19th century-like scenario of arms races, territorial expansion and military rivalries," the report said. "Types of conflict we have not seen for a while -- such as over resources -- could reemerge," it said.



Global wealth is seen shifting from the developed West to the energy-rich Gulf States and Russia, and to Asia, the rising center of manufacturing and some service industries.

Global rich-poor disparities will grow, leaving Africa vulnerable to increased instability. A reordering of the world financial system is also happening faster than the report's authors envisioned, Fingar said.



MAJOR SHIFTS: The recent Group of 20 summit of advanced and major developing countries in Washington showed work had begun, he said. A shift away from an oil-based energy system will be underway or complete by 2025. Better renewable technologies such as solar and wind power offer the best opportunity for a quick and low-cost transition, the report said.



There is a greater, but still small, risk of nuclear attack, based on spreading technologies and the weakening of international nonproliferation systems. If Iran were to acquire nuclear weapons, Fingar said, that could set off an arms race in the Middle East, which is considered in the report as an "arc of instability." The risk that militant groups will use biological weapons is greater than the risk of nuclear terrorism, the report said.





TERRORISM: The appeal of terrorism could decline over the next two decades, particularly if Middle Eastern countries provide productive education and opportunities for their young people, the report said. With a growing population, the pool of potential terrorism recruits is likely to be larger, and access to dangerous weapons will rise. But al-Qaeda could decay "sooner than people think,” it adds, citing the group's growing unpopularity in the Muslim world. "The prospect that al-Qaeda will be among the small number of groups able to transcend the generational timeline is not high, given its harsh ideology, unachievable objectives and inability to become a mass movement," it says.



On other observations: The EU is meanwhile predicted to become a "hobbled giant," unable to turn its economic power into diplomatic or military muscle. "Strategic rivalries are most likely to revolve into types of conflict we have not seen for a while. Such conflicts and resource shortages could lead to the collapse of governments in Africa and South Asia, and the rise of organized crime in Eastern and Central Europe, it adds.

  -- Read More >

THE PRESIDENCY: The race is over and the big question is: Now What? Will President Obama be a practical task-master that can pull the nation together, or will he be an ideologue that ignites the 2012 race tomorrow? The answer will become clear soon, as the nation’s problems must be addressed with dispatch.   -- Read More >

THE PRESIDENCY: The race is over and the big question is: Now What? Will President Obama be a practical task-master that can pull the nation together, or will he be an ideologue that ignites the 2012 race tomorrow? The answer will become clear soon, as the nation’s problems must be addressed with dispatch.
  -- Read More >

HISTORIC WIN: Obama sweeps to his expected historic victory, but the Democrats fall short of the overwhelming mandate for radical change they had hoped for. During the honeymoon period, key appointments will be watched carefully for signals of whether or not the President-elect he will ignore, or run to the political center.

The national election Tuesday was not only historic for the election of the first African-American president in the nation's history but also for how little the avalanche of Democratic votes changed the political alignment in Congress.

The first Democratic Electoral College landslide (349-163) in decades did not result in a tight race for control of Congress. When Franklin D. Roosevelt won his second term for president in 1936, the defeated Republican candidate, Gov. Alf Landon of Kansas, won only two states, Maine and Vermont, and Democrats controlled both houses of Congress by wide margins. Ronald Reagan won every state but one in 1984.

But Obama's win was nothing like that. He may have opened the door to enactment of the long-deferred liberal agenda with his 52-16 percent win (about what the polls had predicted), but he neither received a broad mandate from the public nor the large congressional majorities needed for the overwhelming mandate for radical change the pundits had predicted..

SMALLER GAINS: The Democrats fell far short of the 60-vote filibuster-proof Senate that they were seeking and also failed to get rid of a key Senate target, Republican leader Mitch McConnell of Kentucky. They gained five seats in the Senate (with some still being counted) and 19 in the House, fewer than their planned gains of 10 and 50 seats respectively and short of the filibuster-proof numbers they had hoped for.

Republicans, though discouraged by the election's outcome which they blame largely on the financial crisis on Wall Street which came when the candidates were tied, still believe Obama will be in a tough spot. He must move to enact his ultra-liberal agenda, particularly to meet the demands of minorities and organized labor, while maintaining his popular majority, which he considers to be centrist.

The signs that he will initially run to the center came in the first appointments he has been considering. Word that Obama has offered the White House chief of staff job to Rep. Rahm Emanuel, D-Ill., point in that direction. Emanuel, is a sharp-tongued, sharp-elbowed, keenly intelligent veteran of the Clinton White House who is said to have ambitions to be Speaker of the House. But he also was a strong supporter of Clinton’s “triangulation” strategy of ruling from the center while seeking Republican support.

EXPERIENCE: Emanuel’s experience and the hard, cold realities of the financial crisis have also given an indication that Obama will be careful not to rock too many boats right out of the gate. John Podesta, a former White House chief of staff under President Clinton, and a known pragmatist and political conciliatory, has been leading quiet conversations about key positions, especially those relating to the economy, another indication that Obama will be tying to build a moderate, experienced team.

MARKETS: The markets had expected the outcome, and largely treated the election as a non-event in Wednesday's trading, with the Dow closing down steeply again. "It's virtually all technical, psychological, and very little to do with politics," said Jack A. Ablin, chief investment officer at Harris Private Bank. "Everyone was buying the rumor yesterday and selling the news today.”

The market had not only anticipated an Obama victory, but a much greater Democratic sweep, so cooler heads appear to have prevailed,” Harris says. “Everything pretty much occurred as expected, so most investors are focusing on the Labor Department's October employment report Friday and other broader indicators.”

The next step is to look forward at what sectors of the economy are likely to prosper under Democrats. Traditionally the markets have fared about the same as a result of which party holds power, but the economic emphasis is always different.

The key markets sectors being watched are alternative energy, healthcare, defense and finance. A snapshot of analysts' views on what some individual stocks might do:

b>ENERGY: Many in the sector see an increase in government support coming for alternative technologies. Shares of solar energy companies, beaten down by credit worries and the drop in crude oil prices, have surged in anticipation of a policy focus. Suntech Power Holdings, JS Solar Holdings, First Solar Inc, and SunPower Corp are all up by more than 50 percent in the past week. Shares of Denmark's Vestas, the world's No. 1 wind turbine maker are up by nearly two-thirds in that time.

Experts also see natural gas for electricity generation and industry as key to the energy plans. A drive for more hybrid cars would benefit Energy Conversion Devices Inc, which patented the nickel metal hydride storage technology used in hybrid electric vehicles. Other possible winners are Swiss company Landis+Gyr, which received $1.1 billion in new financing in June and had been looking at floating shares. California-based Silver Spring Networks, which just got $75 million in venture capital funding, and Pittsburgh-based BPL Global are also seen beneficiaries.

DEFENSE: U.S. defense contractors thrive as well during Democratic administrations, if not better, than in Republican ones, and the likely election of Obama as president offers no hint of being an exception. Likely beneficiaries include companies with long-term contracts building fighters, bombers, warships and missiles -- the bread and butter for Lockheed Martin, Northrop Grumman and other big contractors.

Likely losers in the event of an Obama win are companies with lucrative contracts supplying U.S. forces in Iraq, such as bullet-maker Alliant Techsystems, armor plate maker Ceradyne, or large contractors making fighting vehicles such as General Dynamics Corp and BAE Systems Plc.

Boeing looks like a winner, given Democrats' staunch support for the company in its effort to win a controversial $35 billion refueling tanker contract, which will be put up for grabs again next year.

HEALTH CARE: It may be tempting for investors in pharmaceutical and biotech stocks to rush for the exits if a Democratic administration takes over the White House, but drugmakers are about to prove once again why they are a safe haven.

Major decisions on how to cope with the credit crisis are likely to dominate U.S. government thinking in the New Year, bumping down healthcare reform on the priority list for the new president and members of Congress. That spells relative stability for drug stocks, which is attractive to investors seeking safety after a terrible October for the stock market, one of the worst months on record.

Additionally, there are other stocks likely to benefit, including stem cell companies. Obama has voted to overturn current limits on federal funding for stem cell research. That has pushed up the shares of Geron Corp 33 percent over the past week. Shares of Aastrom Biosciences Inc and StemCells Inc have doubled.

TELCOMS: The Democratic win may clear the way for changes to Internet policy sought by Google that would bar Internet providers from discriminating against some Web content. The "net neutrality" issue pits Internet service providers (ISPs) like Comcast and AT&T against content companies like Google and Microsoft.

FINANCE: Democrats are certain to try to help bank customers more, particularly as they try to deal with an economic downturn. Banks may face pressure to renegotiate mortgages to help borrowers avoid foreclosure, and to curb or lower fees on credit cards. That could drive down margins at a time many lenders are scrambling for deposits by offering high yields. Some banks are not waiting for Washington to act before taking steps they say will help struggling borrowers.

JPMorgan Chase, for example, last week announced plans to modify up to $70 billion of mortgages, including from the former units of Washington Mutual that it acquired in September. Bank of America, which bought mortgage lending giant Countrywide Financial Corp in July, adopted a similar program under pressure from regulators.

UNKNOWNS: What lies ahead from Wall Street to Main Street is a great unknown. Seldom if ever, has anyone been elected President, which so many people know so very little about. Obama won a campaign loaded with platitudes and short of specifics. His promises of change and unity never went beyond that – promises and words.

What he will actually do in office remains very much of a mystery, and Obama could turn out just as easily to be a Ronald Reagan or a Jimmy Carter are the extremes, or a Bill Clinton in the mediocre center.

Realclearpolitics.com says: “The Democrats have a mandate to take the country in a new direction. Less obvious is the scope and shape of this new direction. Expanded Democratic majorities give President-elect Obama both the muscle and the latitude to enact a wide variety of legislation that will help flesh out some of the vague aspects of Obama's call for change that carried him to victory.”

“Over the course of the two year campaign, Obama captured the imagination of the American people with his soaring rhetoric of hope and his calls for bipartisan unity. Now, he'll need to use every ounce of his considerable political skill to help guide the country through the host of challenges America currently faces.”
  -- Read More >

HISTORIC WIN: Obama sweeps to his expected historic victory, but the Democrats fall short of the overwhelming mandate for radical change they had hoped for. During the honeymoon period, key appointments will be watched carefully for signals of whether or not the President-elect he will ignore, or run to the political center.  -- Read More >

ZERO HOUR: Finally the end is near. In two days American will have a new President. The polls show an overwhelming Obama win, with the nation veering, perhaps radically, toward the left.   -- Read More >

ZERO HOUR: Finally the end is near. In two days American will have a new President. The polls show an overwhelming Obama win, with the US veering, perhaps radically, toward the left.   -- Read More >

i>   -- Read More >

The Stock markets, while vacillating a great deal and, despite yesterday’s nearly 900 point Dow spike, have been losing a torrent of value for three straight weeks now. When Bush signed the rescue bill Oct. 3, the New York Stock Exchange (NYSE) Composite Index was valued at $14.3 trillion, closing at 7,088 points. The Composite Index, unlike the Dow Jones Index, is a look at how all stocks in the market are faring.
  -- Read More >

FINAL LAP: In the campaign’s waning days Obama holds on to his strong lead, but the polling numbers are still close. He’s outspending McCain by the millions, and the Wall Street upheaval has hurt upset hopes. But it isn’t over until it’s over; picking the cabinet; a backlash.
Little has changed as the campaign nears its end. Obama keeps out-spending and out-polling McCain, especially in key battleground states needed to win the Electoral College. We are now in the period of the “ground game,” or how campaigns refer to getting out the polls by encouraging people to vote. Obama needs a big turnout to win convincingly, and McCain must get the Republicans to vote heavily to pull off an upset.   -- Read More >

FINAL LAP: In the campaign’s waning days Obama holds on to his strong lead, but the polling numbers are still close. He’s outspending McCain by the millions, and the Wall Street upheaval has hurt upset hopes. But it isn’t over until it’s over; picking the cabinet; a backlash.
  -- Read More >

WALL STREET CORRECTS: Wall Street ended a tumultuous plunge with big rallies. The blue chips advanced of 4.8%, the best weekly gain since March 2003. Investors were cheered by signs of easing credit markets. On Oct. 20, the Dow closed up 413.21 continuing the optimistic trend; Bernanke; cyclical view; short sellers help.
  -- Read More >

WALL STREET CORRECTS:

Wall Street ended a tumultuous plunge with big rallies. The blue chips advanced of 4.8%, the best weekly gain since March 2003. Investors were cheered by signs of easing credit markets. On Oct. 20, the Dow closed up 413.21 continuing the optimistic trend; Bernanke; cyclical view; short sellers help.<   -- Read More >

ASIA AND THE MELTDOWN: Amid the worldwide downturn, falling export demand will rattle many Asian countries and direct foreign investment is likely to dry up. But most of the “Asian Tigers” are resilient enough to survive the current problems, although it is the most severe threat faced since the 1997-98 Asian Crisis brought the region to near-collapse.   -- Read More >

ASIA AND THE MELTDOWN: Amid the worldwide downturn, falling export demand will rattle many Asian countries and direct foreign investment is likely to dry up. But most of the “Asian Tigers” are resilient enough to survive the current problems, although it is the most severe threat faced since the 1997-98 Asian Crisis brought the region to near-collapse.<   -- Read More >

CAMPAIGN 2008: The pundits have announced that it is over. The Messiah has arrived and McCain cannot win under any circumstances. But despite the economic upheavals the Dow scores it biggest gain ever, and the race remains remarkable statistically close under the circumstances. The deal has not yet been completely closed

CAMPAIGN 2008: The pundits have announced that it is over. The Messiah has arrived and McCain cannot win under any circumstances. But despite the economic upheavals the Dow scores it biggest gain ever, and the race remains remarkable statistically close under the circumstances. The deal has not yet been completely closed.

DEFENSE New Fronts are Opening that could put the Continental U.S. at Risk. Behind them are a Resurgent Nationalist Russia and a KGB with no Ideological Litmus Test on its Friends and Allies.  -- Read More >

DEFENSE New Fronts are Opening that could put the Continental U.S. at Risk. Behind them are a Resurgent Nationalist Russia and a KGB with no Ideological Litmus Test on its Friends and Allies.

WORLD MARKETS Attention Turns to the Second Largest Economy China Is it Immune to the Global Upheaval? On Closer Inspection, Beijing Faces Some Extremely Serious Structural Problems that put it at Great Risk.   -- Read More >

WORLD MARKETS Attention Turns to the Second Largest Economy; China. Is it Immune to the Global Upheaval? On Closer Inspection, Beijing Faces Some Extremely Serious Structural Problems that put it at Great Risk.

CAMPAIGN 2008, The Wall Street Crisis Goes Global and Deals a Body Blow to McCain’s Prospects. But he is Sill Holding his Own in the Polls, and the “Undecided” Numbers Remain High.
  -- Read More >

CAMPAIGN 2008, The Wall Street Crisis Goes Global and Deals a Body Blow to McCain’s Prospects. But he is Sill Holding his Own in the Polls, and the “Undecided” Numbers Remain High.

DEFENSE, New Systems Are Altering the Way the Pentagon Does Business. Drawing on Commercial Advances, it Moves UAVs to Non-aviators and Even to Autopilot

DEFENSE, New Systems Are Altering the Way the Pentagon Does Business. Drawing on Commercial Advances, it Moves UAVs to Non-aviators and Even to Autopilot   -- Read More >

TECHNOLOGY: The Private Sector Takes a Big Step Forward in Space with a Successful Launch. It May Replace NASA in Key Roles and Major Profits Await.

TECHNOLOGY: The Private Sector Takes a Big Step Forward in Space with a Successful Launch. It May Replace NASA in Key Roles and Major Profits Await.

CAMPAIGN 2008 Obama Holds a Narrow Lead Amid an Unpredictable Political Landscape and Economic Uncertainty. There is a Huge Disconnect in the System; Can Congress or a Community Organizer Fix Wall Street? Europe Takes a Hit   -- Read More >

CAMPAIGN 2008 Obama Holds a Narrow Lead Amid an Unpredictable Political Landscape and Economic Uncertainty. There is a Huge Disconnect in the System; Can Congress or a Community Organizer Fix Wall Street? Europe Takes a Hit. By Dennis Mullin   -- Read More >

THE MARKETS, Even as Lawmakers Dither and Rome Burns, the U.S. Economy Does Remain Fundamentally Sound, and the Feds Could Actually Make a Profit on a Bailout.

THE MARKETS, Even as Lawmakers Dither and Rome Burns, the U.S. Economy Does Remain Fundamentally Sound, and the Feds Could Actually Make a Profit on a Bailout.   -- Read More >

DEFENSE: Obama Wants to Shift the Focus to Afghanistan, But that Conflict May Make the Combat in Iraq Look Easy by Comparison, and Carries Huge Risks   -- Read More >

DEFENSE: Obama Wants to Shift the Focus to Afghanistan, But that Conflict May Make the Combat in Iraq Look Easy by Comparison, and Carries Huge Risks   -- Read More >

CONGRESS: Biden Says Paying Taxes is Patriotic, so he Should ask Fellow Lawmakers for Contributions; It’s Now the Hundreds of Millions Club, and Spends Only Your Cash.   -- Read More >

CONGRESS: Biden Says Paying Taxes is Patriotic, so he Should ask Fellow Lawmakers for Contributions; It’s Now the Hundreds of Millions Club, and Spends Only Your Cash.  -- Read More >

WALL STREET: The Stakes are Enormous, as Bernanke and Paulson Try to Halt the Credit Crunch Bleeding; Will Confidence-Building Measure Be Enough?   -- Read More >

WALL STREET: The Stakes are Enormous, as Bernanke and Paulson Try to Halt the Credit Crunch Bleeding; Will Confidence-Building Measure Be Enough?  -- Read More >

CHAIRMAN’S REPORT: Under the Radar, the IAEA says Rogue Pakistani Scientists Are Still Selling Nuclear Weapons Technology on the Open Market

CHAIRMAN’S REPORT: Under the Radar, the IAEA says Rogue Pakistani Scientists Are Still Selling Nuclear Weapons Technology on the Open Market

ABROAD: Israel Bailed out of Georgia in a Flash, as it’s Interests Lie More with Keeping Russia out of the Mideast than Placating an Increasingly less Important U.S.   -- Read More >

ABROAD: Israel Bailed out of Georgia in a Flash, as it’s Interests Lie More with Keeping Russia out of the Mideast than Placating an Increasingly less Important U.S.
  -- Read More >

CAMPAIGN 2008: The Wall Street Crisis is the Latest Wildcard in the Race, Which Remains a Virtual Tie. Offering Solutions Provides Risks for Both Candidates

By Dennis Mullin




The one thing that is certain about Presidential campaigns is that nothing is certain. This week the John McCain post-convention, post-Palin bounce has settled down. There has been not surge in any direction and with a two-point lead the race with Barak Obama remains in a statistical dead heat.



The arguments continue over experience, dirty campaigning, etc. etc. The first interview of the controversial Republican VP candidate Sarah Palin only indicated that she is unclear of what the Bush Doctrine is – although so is the entire rest of the country and many would argue the President himself isn’t quite sure.



But the crisis on Wall Street is getting everyone’s attention and could have a major impact on how the election plays out. Banking instability could upend the final 50 days of the campaign, with both candidates forced to confront a calamity that has gotten only glancing attention during the first 20 months of the race.

RED FLAGS: Warming signs about the nation’s economic infrastructure have been popping up at least since the collapse in March of the investment bank Bear Stearns. But neither McCain nor Obama has talked in detail about the potential consequences for voters and the government.



Until now, the crisis seemed like just another confusing Wall Street story. That all ended with the fast-moving events of Sunday, which the New York Times has called “one of the most extraordinary days in Wall Street’s history.” A CNBC special report on Sunday night called it “a complete realignment of Wall Street.”



Former Federal Reserve chief Alan Greenspan said Sunday the U.S. is mired in a "once-in-a century" financial crisis which he called “by far” the worse he had seen in his career.

"There's no question that this is in the process of outstripping anything I've seen, and it still is not resolved and it still has a way to go," Greenspan said. "And indeed, it will continue to be a corrosive force until the price of homes in the U.S. stabilizes.”



Greenspan said, "This will induce a series of events around the globe which will stabilize the system," but he added that there was still a “less than 50 percent” chance that the U.S. could escape a recession as a result.

ONCE IN A CENTURY: "I can’t believe we could have a once-in-a-century type of financial crisis without a significant impact on the real economy globally, and I think that indeed is what is in the process of occurring." The former Federal Reserve chairman also predicted that the financial crisis would see the failure of more major financial institutions, even as embattled Wall Street investment giant Lehman Brothers scrambled to find a buyer.



"In and of itself, that does not need to be a problem,” he continued. “It depends on how it is handled and how the liquidations take place. And indeed we shouldn't try to protect every single institution.” Secretary Henry Paulson said that consultations internationally and coordinated actions would stabilize the capital markets.



But how the credit crisis will affect the campaign remains a major wildcard, as neither McCain nor Obama can be blamed for it, nor can responsibility be avoided by the administration or Congress which also plays a major role in market regulation.

IMPACT: In one analysis, Politico sees these effects of the Wall Street crisis on the campaign. 1.) The candidates had hoped to put off their detailed prescriptions until they were in office, unrolling an economic agenda in conjunction with an address to the new Congress. Now, there's no way to duck it.



But at a time when the economy is the top issue on voters’ minds, one of the candidates could wind up winning the neck-and-neck election by talking clearly and convincingly about the fallout and what should be done.



This is the financial equivalent of Russia invading Georgia -- an unexpected event that calls for leadership and direction. This is an opportunity for both candidates to go beyond their (comments on) administration action and show how they would stabilize the system on a more lasting basis.



2.) The new crisis crowds the candidates’ agendas in the stretch run, keeping them from talking about the issues that they had planned to focus on. But the candidates are creatively trying to meld the disaster into their existing messages.

REFORM MESSAGES: McCain aides say he plans to use the news to underscore the reform message that he began hammering at the Republican National Convention. “This is bad news for the country and yet another sign that we need to reform Wall Street,” a senior McCain official said. “The only way we can do that is by reforming Washington first. We will show McCain and Palin as the ticket which will take action on the economy and make sure the taxpayers aren't stuck with the bill.”



Obama aides say he will hammer the message that the market upheaval shows that the country can’t afford four more years of policies aligned with those of the current administration. His running mate, Sen. Joe Biden (D-Del.), is planning major speeches on the subject and will try to get heavy coverage on this theme.



3.) Just like the markets, however, each candidate faces an enormous downside risk: Troubled times could make voters less likely to take a chance on Obama, with his shorter time in Washington. McCain could pay the price for the economic disruption on a Republican's watch, or if he looks like he doesn’t have the energy and creativity to reassure a worried nation.



4.) They will also be more constrained when they get to Washington, with analysts estimating that the government takeover of mortgage giants Fannie Mae and Freddie Mac is likely to cost the Treasury $100 billion to $300 billion. Treasury Secretary Paulson “spent the cookie jar” with the takeover, a McCain adviser said.



Paulson said Monday: “What is going on in New York has nothing to do with politics. These problems did not develop on my watch. International Institutions and Congress now have to work their way through appropriate regulatory reforms. The American financial system is resilient and strong and will absorb these changes. The markets are responding with maturity and calm, and we should all be proud of that.”



That may sound good, but it is tough to run for President in this environment. You certainly cannot advocate the status quo. But at the same token, this may not be the time to be promising sweeping changes to the system either. Just when everyone thought this campaign topped them all for novelty, there are more surprises – and there is still potential for many more to come.
  -- Read More >

CAMPAIGN 2008: The Wall Street Crisis is the Latest Wildcard in the Race, Which Remains a Virtual Tie. Offering Solutions Provides Risks for Both Candidates

ABROAD Russia is back in the Caribbean with Warships and Cash. In a tit-for-tat over Georgia it may Rekindle Cold War Tensions courting Nicaragua and Venezuela as well

ABROAD Russia is back in the Caribbean with Warships and Cash. In a tit-for-tat over Georgia it may Rekindle Cold War Tensions courting Nicaragua and Venezuela as well   -- Read More >

DEFENSE Behind the Success of the Surge in Iraq were Special Operations Teams designed to go after Terrorists; they have scored one Success after Another

DEFENSE Behind the Success of the Surge in Iraq were Special Operations Teams designed to go after Terrorists; they have scored one Success after Another

CAMPAIGN 2008 UPDATE

At mid-week, the McCain polling advantage is holding, with major shifts in women and independent voters in his direction. The press still doesn’t understand that it is hurting its favorite son. Even the money race is going the Republican’s way.

CAMPAIGN 2008 UPDATE

At mid-week, the McCain polling advantage is holding, with major shifts in women and independent voters in his direction. The press still doesn’t understand that it is hurting its favorite son. Even the money race is going the Republican’s way.

CAMPAIGN 2008 The Media Served up a Softball, and Republicans Hit it Out of the Park. Polls Show a 17-Point Swing in McCain’s Favor, as Odds Improve that He May Beat the “Community Organizer” in Eight Short Weeks.

ABROAD An Update on the Arab-Israeli Conflict Carries Some Surprises, About Lebanon, Venezuela and Problems Within the Israeli Army Itself

ABROAD An Update on the Arab-Israeli Conflict Carries Some Surprises, About Lebanon, Venezuela and Problems Within the Israeli Army Itself

CHAIRMAN’S REPORT Speaker Pilosi Ignited the Latest Abortion Furor and the Catholic Church is Not Amused; Is She Politicizing the Debate Anew?

POLITICAL SCENE: Change is the Codeword for the Campaign, But Who Will Really Bring It? Some See an FDR Type “Audacity of Hype”

POLITICAL SCENE: Change is the Codeword for the Campaign, But Who Will Really Bring It? Some See an FDR Type “Audacity of Hype”   -- Read More >

CAMPAIGN 2008, McCain Drops a Bombshell With his VP Selection; Will a 44-Year-Old woman Help of Hurt? Polls Show He Trumped Obama’s Convention

DEFENSE Extended UAV Flight Has Become the Rage as a New Record is Broken, and Others Seek to Expand the Horizons Vastly with New Technology

CAMPAIGN 2008, McCain Drops a Bombshell With his VP Selection; Will a 44-Year-Old woman Help of Hurt? Polls Show He Trumped Obama’s Convention   -- Read More >

CHAIRMAN ‘S REPORT A Mile High Convention; Reporters Won’t Listen to Their Own Interviewee; Rock Stars Could Hurt the Candidate; New Yorkers Warned on Booze

CAMPAIGN 2008 , The Convention Comes With the Race Still Tied; Watching Expectations; Biden Choice Has Little Impact; National Security Debate

DEFENSEThe War in Georgia Highlights the Kremlin’s Need for a New Military Doctrine, as it Seeks to build a Modern Armed Forces for a Post Cold-War World

DEFENSEThe War in Georgia Highlights the Kremlin’s Need for a New Military Doctrine, as it Seeks to build a Modern Armed Forces for a Post Cold-War World

CAMPAIGN 2008 With Conventions Looming the Real Contest Begins, and Democrats Could Provide Some Clinton Drama; The Race is a Dead Heat; The VP Picks

ABROAD: The Russian-Georgia War Holds Many Dangers, as the Repercussions of the Demise of the Soviet Union Linger Years After the Fact   -- Read More >

TRADEThe Demise of the Doha Round Won’t Spell Disaster for World Commerce, as Systems Take Place in Individual Nations That Bolster Trade Globally

TRADE The Demise of the Doha Round Won’t Spell Disaster for World Commerce, as Systems Take Place in Individual Nations That Bolster Trade Globally

CHAIRMAN’S REPORT, On the Olympic Watch, Everyone is Following Weather and the Terrorists Open Their Promised Fatal, anti-Government Attacks

REALITY CHECK

By Dennis Mullin

CONGRESS A Full Switch by Democrats, Including Obama, on Off-Shore Drilling Shows the Issue has Real traction for McCain and the Republicans

DEFENSE: The Pentagon and CIA Call Them “Black Holes,” or the Key Places Terrorists and Fugitives Can Hide Around the World, with Near Impunit   -- Read More >

CONGRESSA Full Switch by Democrats, Including Obama, on Off-Shore Drilling Shows the Issue has Real traction for McCain and the Republicans,/b>

CAMPAIGN 2008:More of the Same From the Press, But The Latest Poll Actually Shows McCain Ahead for the First Time, And Leading With Independents

CAMPAIGN 2008:More of the Same From the Press, But The Latest Poll Actually Shows McCain Ahead for the First Time, And Leading With Independents

CHAIRMAN’S REPORT : A Billion of Anything Goes a Long Way, But Also Leads to Incredible Waste When Put in the Hands of Big Government

DEFENSE: Top Officers are Looking at IRS as a New Field of Great Importance to Provide Real-Time Intelligence to Forces Engaged in Active Combat   -- Read More >

TECHNOLOGY:Is the U.S. Losing its Lead in Science and High-Tech? That is the Conventional Wisdom, but New Numbers Say it is Not the Case

CONGRESSBailout Funds for the Banks are Put Into Place, to the Distress of Many

CHAIRMAN’S REPORT Eurosclorosis Turns Into Euronuerosis as Intellectuals Seek Enlightenment; America too Seeks a Revitalization

ABROAD:Some Mideast Peace Deals May be on the Horizon in the Third Quarter, But Many Details Still Have to Fall into Place

CAMPAIGN UPDATE: Is the Press Reaction Backfiring in this, the First Virtual Election?

CAMPAIGN UPDATE: Is the Press Reaction
Backfiring in this, the First Virtual Election?

TODAY’S FEATURE

REALITY CHECK

CAMPAIGN 2008 , Barack’s Coronation Trip Draws Predictable, Effusive, Media Praise; Both Candidates Gear up for Expensive, Nationwide Voting Drives

CAMPAIGN 2008 , Barack’s Coronation Trip Draws Predictable, Effusive, Media Praise

UNPRECEDENTED: Besides owning the press, Obama's fund-raising machine has been scoring unprecedented success. His campaign will need every penny of its $300 million goal to bankroll a 50-state election campaign with a massive army of volunteers.



The Obama campaign already has by far the largest full-time paid staff in presidential campaign history, and unlike McCain's, continues to grow by the day. The Obama campaign is paying close attention to polls in more than a dozen states that show Obama has a chance of winning over for the Democrats in November.



To accomplish that, Obama is assembling what would be the largest field operation in the history of American politics. Advertising and campaign communications will be important and debate performances will be critical, but the Obama campaign is investing heavily in the importance of organizing voters and getting them to the polls on Nov. 4.



It's a major departure from the 2004 Democratic game plan, in which the ground organization was split and sometimes duplicated between the Sen. John Kerry, Democratic Party operation and a group called America Coming Together, financed by wealthy liberal activists and labor unions. ACT spent about $80 million and had 300 employees and 1,400 paid canvassers working in 17 key states.

SOPHISTICATED: In their nomination fight, the Obama and Clinton campaigns have built sophisticated state-by-state organizations. The Obama campaign has employed three different organizing models over the course of the campaign, and in May, about 30 of the top state and field directors met to map a strategy for the general election.



They came up with a neighborhood and volunteer-based plan that incorporates elements of the Republican model under Karl Rove and Ken Mehlman for Bush's 2004 reelection campaign. The GOP used commercial marketing data with volunteers organizing Bush supporters around the "virtual precinct" of their own social networks.



"This allows us to increase the volume of voters we're talking to and have it be done with people who live in their community," one veteran Democratic operative says. The level of organization is a first on the Democratic side. The Obama model, particularly in its use of the Internet as an organizing tool, is a significant upgrade.



"People tend to believe information delivered by people they know and who live in their neighborhood more than an ad they see on television or what some third party from out of their state is telling them," says one operative. "It can really change the electoral map."



Many states won four years ago by President Bush, in many cases by huge margins are now seen in play. Obama's effort could nudge states such as Virginia, Indiana, and North Dakota into the Democratic column and produce a surprising Electoral College boost.

TOSSUP STATES: McCain so far is running a more traditional campaign, targeting perennial tossup states such as Florida and Ohio, sending smaller staffs to those states than Obama, but spending more on television ads. His campaign manager, Rick Davis, said recently that his staff will eventually increase to about 450. By earlier this month, it had opened 11 regional offices in key states and another 84 offices across the country.



"It is an incredible amount of progress for a campaign that ended the primaries with no money, little infrastructure, and no formal organization outside the early primary states," says a McCain staffer. "By putting emphasis on our regional operations we have built a campaign that will be nimble when it counts and close to the ground where grass-roots activity will drive our message and efforts."



Obama, meanwhile, is already running uncontested television advertising in seven of the historically Republican states and is sending in large paid staffs. Between the Obama staff and the Democratic Party staff there will be several thousand paid operatives on the ground deployed across the country.



Reports filed with the Federal Election Commission show that in May the Obama campaign had a payroll of about 900, not counting nearly 500 part-time workers who were paid stipends. As of May 31, the Obama staff was well over twice the size of the Bush reelection campaign staff in 2004 and nearly three times the size of McCain's.

Through the end of May, the Obama campaign had spent $35.7 million on salaries and benefits, triple the $11.9 million spent by the McCain campaign, according to tabulations by the Center for Responsive Politics, a nonpartisan research group.

EXPENSIVE: Obama's labor-intensive strategy will become increasingly expensive, though the campaign took a large step toward its goal by raising $52 million in June after wrapping up the Democratic nomination. But it will probably have to exceed that figure every month until November to hit its target, and the Democratic National Committee, which announced that it took in $22.4 million last month, faces a similar task to reach a goal of $180 million by the election.



The Republican Party and McCain campaign hope to raise a combined $400 million to be competitive in the fall. That includes $84.1 million in public funding McCain says he will accept after his formal nomination on Sept. 4. Despite assertions in the past that he would also take public funding, Obama will become the first presidential candidate to refuse the public grant since the advent of federal financing in 1976.



Obama's campaign is optimistic it can reach its targets because it achieved ambitious goals in its bitter upset over Hillary Clinton to win the nomination. Underlying the optimism is faith in the premise of the Obama candidacy that many Americans are angry, anxious, and engaged as never before in the political process because they want change. And there is increased confidence that they fawning press will make the process easier.
  -- Read More >

DEFENSE: China’s Army Raised Some Eyebrows By Showing up At Refugee Relief Camps Short on Gear; Building a Modern Army Costs a lot and Takes Time

ABROAD Missiles or no Missiles, Iran is a Mess, With an Economy on the Rocks

DEFENSE: China’s Army Raised Some Eyebrows By Showing up At Refugee Relief Camps Short on Gear; Building a Modern Army Costs a lot and Takes Time

By Dennis Mullin

CAMPAIGN 2008 Polls now Show a Dead Heat in the Presidential Race, Something the Media is Loath to Admit. They Also Show McCain’s Age a Concern

TODAY’ FEATURE: Is the World Going to Hell in a Hand Basket? Big Change is Coming; But Outlook isn’t All Gloom

REALITY CHECK: OFFSHORE DRILLING, PEAKING
DEMAND, DRIVING OIL DEBATE

  -- Read More >

CAMPAIGN 2008, The Democratic Race is Gratefully Over. Obama’s First Presidential Decision Will be Picking His Running Mate, and The Process has Changed
CONGRESS, Lawmakers Don’t Fare Well on the Big Stage; a Setback on Environmental Legislation
CLIMATE CHANGE, The G-8 Meeting in Japan Could Find That the Cost of Really Doing Something About It is Enormous
TECHNOLOGY, Is America Losing the Space Race? China Is Coming on Strong and Plans to Beat the U.S. Back to the Moon. Its Program has Civilian and Military Goals
ABROAD, Terrorists Are Finding it Harder and Harder to Operate Around the World. The Ten Countries Osama bin Laden and his Gang Don’t Want to Be Assigned to
DEFENSE, Troops on the Ground Are Now Getting High-Resolution Video From Aircraft on Hand-Carried Devices that Significantly Increase Combat Effectiveness
CHAIRMAN’S REPORT, Who is safe? It is More Dangerous to Live in South Africa Than Fight in Iraq; for Women, the Army is Safer than Being in College
TODAY’S FEATURE, Are Our Politicians Becoming Irrelevant? (Watch for Carlos Campbell’s Report from the Olympics in Beijing)
*AmericaWeek*

CAMPAIGN 2008

The race for the Oval Office is now down to two – finally. Over the weekend Hillary Clinton officially suspended her campaign and announced her support for Barak Obama. But the endless and bitter Democratic primary has opened fault lines within the party and exposed Obama to criticism that Republican John McCain will now attempt to exploit.

Nobody is certain how the race issue will play out, or if white American males, who have been totally ignored by the pollsters so far, are ready to cast their vote for a black man who many claim is questionable on defense issues. Obama’s national experience is limited to two years in the Senate, and he has associated himself with some pretty less-than-strong Patriotic elements, some Republicans charge.

The newly anointed Obama will now turn to his first major decision as the presumptive nominee, and that is the selection of a vice presidential running mate. The furor is whether selecting Hillary will strengthen him among Democratic elements or hurt him as a candidate who ran on change, then reversed himself to carry the Clinton baggage.

Some 36 million Americans took part in selecting the Democratic nominee for president, and half voted for Clinton. And yet, only one person chooses the nominee for vice president, a potentially crucial choice in a system that often produces one-term leaders.

Analyst Michael Barone notes that, theoretically, the choice of vice president could go to the party's national convention, as some Hillary supporters are now suggesting. That happened to Adlai Stevenson in 1956. There was a floor fight between John F. Kennedy, Albert Gore Sr., and (the ultimate winner) Estes Kefauver for the second spot.

But ever since 1972, in reality, the presidential nominee has been in absolute control of a majority of votes at the conventions. Delegates expect direction from their preferred Commander in Chief, and a second round of mini-primaries and caucuses to choose the vice presidential nominee becomes too tedious to work. Hence, it is the nominee’s decision

TIMING: Before the Democrats nominated Walter Mondale in 1984, vice presidents were usually picked at the last minute at the conventions. In 1976 Gerald Ford selected Bob Dole in the wee hours of the morning, and Jimmy Carter selected Mondale during convention week. In 1980 Ronald Reagan picked George H. W. Bush only after some hours of negotiation by Gerald Ford for a "co-presidency."

Mondale wanted to do it differently. When he was vice president, Jimmy Carter had delegated important government responsibilities to him, had given him an office in the West Wing and held regularly scheduled meetings with him. It was the first time the VP had real responsibility and was a change from previous practice.

In the three months Harry Truman was vice president, he meet with President Franklin Roosevelt exactly once. When he was summoned to the White House on April 12, 1945, he did not even know that Roosevelt was in Washington. Richard Nixon was never once invited to the President's private quarters in the eight years he was Eisenhower’s No. 2.

Lyndon Johnson was treated more respectfully by JFK, but not by some of his staffers. Johnson repeatedly humiliated Hubert Humphrey. Richard Nixon assigned Spiro Agnew a role as speech giver and nothing else, and the VP even ended up getting indicted.

FEMALE FACTOR:

CLIMATE CHANGE

TECHNOLOGY

ABROAD

DEFENSE

CHAIRMAN’S REPORT

TODAY’S FEATURE

Election 2008: Are Our Politicians Becoming Irrelevant? By Dennis Mullin

Many Americans are beginning to wish, were it possible, that this election could simply be canceled. It is already stultifyingly endless, and we won’t even choose a President for another six months. The real campaign hasn’t even started yet. That’s bad news for the candidates in 2008, who clearly don’t understand that they cannot count on business as usual and may become irrelevant by the time they seek re-election. They are the politically functional equivalent of the old IBM in a world looking to discover its new political version of Bill Gates and Microsoft.



SHOUTING MATCH: The unseemly Democratic shouting match, which rehashes the same issues day after day after day, puts the ultimate shouter Chris Matthews to shame. McCain is wondering around somewhere, and the idiots on TV are providing 24X7 coverage of exactly the same thing over and over. It’s feeling like Ground Hog Day.



Everybody is promising billions for this and billions for that, which we all know isn’t available and won’t be spent. The Democratic Congress just keeps spending money hand over fist with Republican support, proving that it won’t make a difference who wins the Presidency or which party can steal the most.



The whole thing is a reality show for people who have wanted to be a politician all of their lives, either because they aren’t qualified to hold a real job or just want to say they accomplished their goal. This time we even have one who implies she is entitled to the Oval Office because her husband once partied there.



HYSTERIA: The campaign has also become a classic case of politically correct demographic hysteria. The professors who invented the 6,000 categories on the race form (which does not include mixed race) must be thrilled to hear that X percentage of the white, female, non-cooking, smokers over 42 with 11.4 years of elementary education voted differently from the Hispanic, male, smoker with a mustache, and a high school diploma who prefers baseball over soccer, according to the latest exit polls.

FARM FAT: The Democrat-controlled Congress has poured on the fat. It approved a $307 billion farm bill on May 14, by a vote of 318 to 106. The Senate endorsed this boondoggle with near-full Republican support. The legislation gives $3.8 billion in farming disaster assistance to those who already have received $5.2 billion in direct payments for their "historical planting average," even if they have stopped farming.

While typical GIs in Iraq and Afghanistan dodge bullets for just $41,591 annually, couples with yearly incomes up to $1.5 million still can receive agricultural subsidies. Democrats consider these wealthy growers rich enough to sustain tax hikes, yet poor enough to receive farm welfare.

Meanwhile, dim-witted ethanol assistance survives, excessive sugar supports expand, and those who cultivate lentils, chickpeas, salmon, and even racehorses join the dole. Greedy politicians use taxpayers' money to buy the votes of equally greedy farmers, even as they chastise other nations in trade talks for exactly the same thing.

“An upcoming wave of new workers in our society will never work for an established company if they can help it. To them, having a traditional job is one of the biggest career failures they can imagine,” he says.



“There has never been a nation in which the dominant paradigm is entrepreneurship. Not just self-employment or sole proprietorship, but serial company-building, entire careers built on perpetual change, independence and the endless pursuit of the next opportunity.”



NEW EPOCH: “Without noticing it, we have once again discovered, and are racing to settle a new frontier. Not land, not innovation, but ourselves and control over our own lives and careers. Each step in the development of American society has been towards an ever-greater level of independence, freedom and personal liberty. And as the rest of the world catches up, we've already moved on to the next epoch in the national story.”



“But liberty exacts its own demands. Entrepreneurial America is likely to become even more innovative than today. And that innovation is likely to spread across society, not just as products and inventions, but new ways of living and new types of organizations.”



“The economy will be much more volatile and competitive. In the continuous fervor to create new institutions, it will become increasingly difficult to sustain old ones. New political parties, new social groupings, thousands of new manias and movements and millions of new companies will pop up over the next few decades. Large firms that don't combine permanence with perpetual change will be swept away,” he concludes.



IMMIGRANTS: A new study by the Manhattan Institute also indicates that these shifts will easily incorporate new arrivals. It says of the latest extraordinarily large burst in immigration, that the new arrivals bear much resemblance to the Italian, Greek, and Polish immigrants of 1910. These immigrants are quite distinct from the native-born population because they speak English relatively poorly and tend to occupy lower rungs on the socio-economic ladder.



Yet the immigrants of a century ago, and many groups of immigrants today, make quick progress as they spend more time here -- advancing economically, and becoming naturalized citizens. “In addition, their children are in most ways nearly indistinguishable from native-born children.”



That indicates that while academia and politicians keep striving to define America as distinct Bantustans that must be catered to and showered with entitlements, the opposite may be the case. Interestingly, the most quickly and successfully assimilated immigrants are from Vietnam and Cuba, and those fleeing totalitarianism. Thus the new technological and entrepreneurial landscape will create new voters who value self-reliance and fiscal responsibility over social paternalism, and government intervention.



That’s bad news for the candidates in 2008, who clearly don’t understand that they cannot count on business as usual and may become irrelevant by the time they seek re-election. They are the politically functional equivalent of the old IBM in a world looking to discover its new political version of Bill Gates and Microsoft.
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Following the February 3 Serbian elections, it is inevitable that the Albanian Muslim Administration of the Serbian province of Kosovo will unilaterally declare independence. Despite Serb protests, the United States stands ready to recognize this declaration and the fallout could be enormous. However noble their intentions, the military intervention in the Balkans in the late 1990s by the Clinton Administration and the European Union has resulted in creating a potentially militant Islamic presence pointed directly for the heart of Europe. What is alarming is that the international community at large is unaware or uninterested in what is happening in this critically strategic area.   -- Read More >

Balkan Terrorists at work in the U.S.? The recent "Fort Dix Six"( a Turk, a Jordanian, and four ethnic Albanians), most long-time residents of the U.S.(three are illegal), may well have an ominous nexus to Balkan Islamist terrorism. Accordingly, we are reposting here a Publisher's Memo originally appearing in ContinentalDivide.us February, 2006.