Amy Goodman
The Spokesman-Review

“Extraordinary rendition” is White House-speak for kidnapping. Just ask Maher Arar. He’s a Canadian citizen who was “rendered” by the U.S. to Syria, where he was tortured for almost a year. Just this week, the Second U.S. Circuit Court of Appeals, in New York City, dismissed Arar’s case against the government officials (including FBI Director Robert Mueller, former Homeland Security Secretary Tom Ridge and former Attorney General John Ashcroft) who allegedly conspired to have him kidnapped and tortured.

Arar is safe now, recovering in Canada with his family. But the decision sends a signal to the Obama administration that there will be no judicial intervention to halt the cruel excesses of the Bush-era “Global War on Terror,” including extraordinary rendition, torture and the use of the “state secrets privilege” to hide these crimes.

Arar’s life-altering odyssey is one of the best-known and best-investigated of those victimized by U.S. extraordinary rendition. After vacationing with his family in Tunisia, Arar attempted to fly home to Canada. On Sept. 26, 2002, while changing planes at JFK Airport, Arar was pulled aside for questioning. He was fingerprinted and searched by the FBI and the New York Police Department. He asked for a lawyer and was told he had no rights.

He was then taken to another location and subjected to two days of aggressive interrogations, with no access to phone, food or a lawyer. He was asked about his membership with various terrorist groups, about Osama bin Laden, Iraq, Palestine and more. Shackled, he was moved to a maximum-security federal detention center in Brooklyn, strip-searched and threatened with deportation to Syria.

Arar was born in Syria and told his captors that if he returned there, he would be tortured. As Arar’s lawyers would later argue, however, that is exactly what they hoped would happen. Arar was eventually allowed a call – he got through to his mother-in-law, who got him a lawyer – and a visit from a Canadian Consulate official.

For nearly two weeks, the U.S. authorities held the Syria threat over his head. Still, he denied any involvement with terrorism. So in the middle of the night, over a weekend, without normal immigration proceedings – without anyone telling his lawyer or the Canadian Consulate – he was dragged in chains to a private jet contracted by the CIA and flown to Jordan, where he was handed over to the Syrians.

For 10 months and 10 days, Maher was held in a dark, damp, cold cell, measuring 6 feet by 3 feet by 7 feet high, the size of a grave. He was beaten repeatedly with a thick electrical cable all over his body, punched, made to listen to the torture of others, denied food and threatened with electrical shock and an array of more horrors. To stop the torture, he falsely confessed to attending terrorist training in Afghanistan. Then, after nearly a year, he was abruptly released to Canada, 40 pounds lighter and emotionally destroyed.

The Canadian government, under conservative Prime Minister Stephen Harper, investigated, found its own culpability in relaying unreliable information to the FBI and settled with Arar, giving him an apology and $10 million. The U.S. government, on the other hand, has offered no apology and has kept Arar on a terrorist watch list. He is not allowed to enter the U.S. Two years ago, he had to testify before Congress via video conference.

He said: “These past few years have been a nightmare for me. Since my return to Canada, my physical pain has slowly healed, but the cognitive and psychological scars from my ordeal remain with me on a daily basis. I still have nightmares and recurring flashbacks. I am not the same person that I was. I also hope to convey how fragile our human rights have become and how easily they can be taken from us by the same governments that have sworn to protect them.”

Given the excesses of the Bush administration and Barack Obama’s promise of change, it has surprised many that these policies are continuing and that Congress and the courts have not closed this chapter of U.S. history. President Obama has never once condemned extraordinary rendition.

Arar’s lawyer, Maria LaHood, of the Center for Constitutional Rights, calls the court decision against Arar “an outrage.” In his dissent, Judge Guido Calabresi wrote, “I believe that when the history of this distinguished court is written, today’s majority decision will be viewed with dismay.” Given the torture that Arar suffered, his own response was remarkably measured: “If anything, this decision is a loss to all Americans and to the rule of law.”

Amy Goodman hosts a daily international TV and radio news hour called “Democracy Now!” that airs on more than 800 stations in North America. Denis Moynihan contributed research to this column.

By DAVID M. HALBFINGER and IAN URBINA

Republicans swept contests for governor in New Jersey and Virginia on Tuesday as voters went to the polls filled with economic uncertainty, dealing President Obama a setback and building momentum for a Republican comeback attempt in next year’s midterm Congressional elections.

But in a closely watched Congressional race in upstate New York, a Democrat who received a late push from the White House triumphed over a conservative candidate who attracted national backers ranging from Rush Limbaugh to Sarah Palin, the former Alaska governor.

In New Jersey, a former federal prosecutor, Christopher J. Christie, became the first Republican to win statewide in 12 years by vowing to attack the state’s fiscal problems with the same aggressiveness he used to lock up corrupt politicians.

He overcame a huge Democratic voter advantage and a relentless barrage of negative commercials to defeat Jon S. Corzine, an unpopular incumbent who outspent him by more than two to one and drew heavily on political help from the White House, including three visits to the state from President Obama.

“We are in a crisis; the times are extraordinarily difficult, but I stand here tonight full of hope for the future,” said Mr. Christie, 47, who will become New Jersey’s 55th governor. “Tomorrow begins the task of fixing a broken state.”

Mr. Corzine, 62, who entered politics a decade ago after a career at Goldman Sachs, conceded at 10:55 p.m. “It has been quite a journey,” he said. “There’s a bright future ahead for New Jersey if we stay focused on people’s lives, and I’m telling you, I’m going to do that for the rest of my life.”

With 98 percent of precincts reporting, Mr. Christie had 49 percent of the vote, Mr. Corzine 44 percent.

In Virginia, where Mr. Obama was the first Democratic presidential nominee to carry the state since 1964, Robert F. McDonnell, a Republican and former state attorney general, rolled to victory over R. Creigh Deeds, a veteran state senator.

With 99 percent of precincts reporting, Mr. McDonnell had 59 percent and Mr. Deeds 41 percent. Mr. McDonnell’s victory, along with Republican victories in the races for attorney general and lieutenant governor, ended eight years of Democratic control in Richmond.

In New York’s 23rd Congressional District, Douglas L. Hoffman, a little known accountant running on the Conservative Party line, conceded after midnight to his Democratic rival, Bill Owens, after driving a moderate Republican from the race.

The three races marked the first major elections since the country plunged into the worst recession in decades, and basic economic issues — job losses, foreclosures, taxes — were front and center.

In Virginia, Mr. McDonnell, avoided divisive social issues, concentrating instead on his plans to create jobs, improve the economy and fix the state’s transportation problems.

In New Jersey, Mr. Christie held Mr. Corzine, a onetime Goldman Sachs chief executive, accountable for rising unemployment, persistent budget deficits, and his failure to gain control over skyrocketing property taxes, the nation’s highest. Voters embraced Mr. Christie even though he offered little detail about how he would fix the state’s chronic financial problems and instead appealed to voters hungry for change.

Voters in both states remained strongly supportive of President Obama, exit polls conducted by Edison Research showed, though they said that was not a factor in their decisions. But independent voters, who in New Jersey favored the president in 2008 and in Virginia split between Mr. Obama and John McCain, delivered strong margins for both Mr. Christie and Mr. McDonnell, the surveys showed.

In New Jersey, a sprawling corruption case begun by Mr. Christie, which culminated in July with the arrests of dozens of politicians and others, appeared to have taken its toll on the Democratic get-out-the-vote machinery. In Hudson County, a party bastion where a number of Democratic officials were charged, only 39 percent of registered voters cast their ballots, county officials said.

The races in New Jersey, Virginia and New York attracted intense interest because they provided the first test of President Obama’s ability to transfer the excitement he unleashed last year to other Democratic candidates.

The White House, to varying degrees, became involved in all three races, worried that defeats would undermine the public’s perceptions of the president’s political clout and his ability to pass major legislation.

With polls of the Virginia race showing Mr. Deeds falling further behind, the White House refrained from an all-out effort on his behalf, though Mr. Obama campaigned with Mr. Deeds twice.

In New York, however, the president’s aides played a pivotal role in helping Mr. Owens over the weekend, engineering a surprise endorsement from the moderate Republican who had abandoned the race under pressure from conservatives.

And in New Jersey, the White House took a firm hand in guiding Mr. Corzine’s re-election campaign, culminating in rallies featuring the president campaigning with the governor in Newark and Camden on Sunday.

The victor in Virginia, Mr. McDonnell, 55, is a social and fiscal conservative, but ran on a more moderate platform that appealed to voters in the suburbs in Fairfax County, where he was raised. By contrast, Mr. Deeds, 51, had a difficult time introducing himself to densely populated Northern Virginia.

Mr. Deeds sought to portray Mr. McDonnell as a radical conservative by publicizing his 20-year-old master’s thesis, which criticized working women and single mothers. But polls showed voters found Mr. Deeds’s commercials too negative.

The New York race emerged in the national spotlight after President Obama appointed the district’s long-serving congressman, John M. McHugh, a Republican, as secretary of the Army. Almost immediately after local Republican leaders chose Dede Scozzafava, a supporter of gay rights and abortion rights who embraced the federal stimulus package, she came under attack by conservatives as heretical.

Leading conservative voices lined up behind Mr. Hoffman, of Lake Placid, and opponents of same-sex marriage and abortion flooded the district with volunteers from across the country.

In the final days of the campaign, Ms. Scozzafava stunned her party by withdrawing from the race and then backing Mr. Owens. Vice President Joseph R. Biden Jr. traveled to Watertown on Monday to rally Democrats and disgruntled Republicans, but the event drew only about 200 people.

In New Jersey, Mr. Christie attacked Mr. Corzine’s economic leadership, saying he had driven jobs and residents from the state. The governor countered that Mr. Christie offered no viable plan for digging New Jersey out of its enormous financial hole.

Christopher J. Daggett, a former state and federal environmental official, made a splash with a plan to cut property taxes and a strong debate performance, but was hobbled by weak fund-raising. After reaching 20 percent in one public-opinion poll, he failed to break out of the double digits.

New Jersey was a deep-blue state, and Mr. Obama’s election boosted Democratic registration, giving the party a 700,000-vote advantage. Mr. Corzine assailed Mr. Christie, who was named United States attorney by President George W. Bush in 2001, as a philosophical clone of Mr. Bush.

The White House, viewing New Jersey as its best hope for victory, poured resources into the race. The president’s pollster overhauled the campaign’s message, White House aides reviewed Corzine commercials and attended strategy sessions, and cabinet officials lined up to appear at Mr. Corzine’s side.

But Mr. Corzine’s abiding unpopularity — his highest approval rating followed his 2007 car accident and was chalked up to pity — suggested that even “Obama surge” voters who voted for the first time last year could not tilt the outcome in the governor’s favor.

No issue loomed larger in New Jersey than the economy, which Mr. Corzine assured residents in January ranked as his No. 1, 2 and 3 priorities. But Mr. Christie never wavered from a simple strategy: making the vote a referendum on Mr. Corzine and highlighting how his supposed Wall Street financial skills had been a bust for the state.

David Kocieniewski and Nate Schweber contributed reporting.

By DAVID W. CHEN and MICHAEL BARBARO

Mayor Michael R. Bloomberg pulled out a narrow re-election victory on Tuesday, as voters angry over his maneuver to undo the city’s term limits law and his extravagant campaign spending provided an unexpected lift to his vastly underfinanced challenger, William C. Thompson Jr.

Unofficial returns showed Mr. Bloomberg with 51 percent and Mr. Thompson with 46 percent. The result will make Mr. Bloomberg only the fourth three-term mayor in the last century.

“Conventional wisdom says historically third terms haven’t been too successful,” the mayor told supporters at the Sheraton New York Hotel in Midtown Manhattan around midnight after a tense night of watching returns. “But we’ve spent the last eight years defying conventional wisdom.”

Still, the margin seemed to startle Mr. Bloomberg’s aides and the city’s political establishment, which had predicted a blowout. Published polls in the days leading up to the election suggested that the mayor would win by as many as 18 percentage points; four years ago, he cruised to re-election with a 20 percent margin.

The billionaire mayor had poured $90 million of his own fortune into the race, a sum without equal in the history of municipal politics that gave him a 14-to-1 advantage in campaign spending.

But the turnout appeared to be on track to be among the lowest in modern New York history as the mayor’s vaunted campaign machinery failed to deliver the surge of supporters his aides had predicted.

“Everybody was shocked,” a Bloomberg aide said.

Mr. Bloomberg had based his third-term campaign largely on the argument that the city has been better run since he ushered in an era of corporate efficiency and nonpartisan leadership at City Hall. He also pointed to his accomplishments in education, crime reduction and public health.

But voters from Park Slope in Brooklyn to Morrisania in the Bronx seemed torn.

While they praised his competence and intelligence, many were put off by what they saw as Mr. Bloomberg’s heavy-handed move to rewrite the law that would have limited him to two consecutive terms, saying it was obviously self-serving. The mayor had previously opposed any undoing of term limits, which voters had approved twice.

“The main reason I didn’t vote for Bloomberg was the term limits,” said Katherine Krase, a 34-year-old professor, voting at her local school in Park Slope.

At the same school, Gerni Oster, 34, said: “I think that Mayor Bloomberg is too egotistical and arrogant for me to vote for at this point.”

Exit polls indicated that 45 percent of voters said that Mr. Bloomberg’s handling of term limits was a factor in their decision not to vote for him, and roughly the same number said the mayor’s spending on the race was an important factor. Nearly 7 of 10 approved of his job performance.

Bill de Blasio and John C. Liu, both Democrats, were elected public advocate and comptroller, respectively.

The results in the mayor’s race are likely to be personally bruising to Mr. Bloomberg, a man of no small ego who told the public last fall that his financial acumen made him uniquely qualified to pull the city out of a deep economic funk.

Already, Democrats seemed emboldened by the outcome.

“We learned tonight that people do not forget easily,” said Representative Anthony D. Weiner, the Queens Democrat who considered, but then decided against, challenging the mayor. “A lot of people, whether they said it to pollsters or not, were offended by the term limits fight.”

And, addressing a crowd at the New York Hilton in Midtown, Mr. Thompson sounded like a man who was planning another campaign.

“The work we started during this campaign doesn’t end tonight, in fact, it’s just beginning,” he said.

Even those who backed the mayor seemed to do so reluctantly.

Stav Brinbaum, 37, a Web producer from Prospect Heights, Brooklyn, described his own vote for the mayor as “unfortunate.”

“I feel he bought himself the election,” Mr. Brinbaum said, and “ran a smear campaign against a nonexistent opponent.” But, he added, “He’s doing a really good job.”

“If there were somebody stronger running against him, I would have happily voted for them,” said Paul Ranson, 56, a designer also from Prospect Heights. “But there’s not, so I unhappily voted for Bloomberg.”

Mr. Bloomberg’s campaign managers prided themselves on the their communications strategy, which flooded mailboxes, e-mail inboxes and television screens.

But for some on the receiving end, it was just too much. Ken Ficara, 40, a Web developer from the same neighborhood, remained undecided until the day before the election, when he received six automated telephone calls from the Bloomberg campaign.

He updated his Facebook page, writing: “Mike, the more you call me, the less likely I am to vote for you.”

Still, according to exit polls, Mr. Bloomberg tapped into his historic sources of strength: Staten Island and Queens backed him by comfortable margins, as did Jews, white Catholics and those earning more than $200,000.

Mr. Thompson did best in the Bronx, and ran even with Mr. Bloomberg among voters aged 18 to 29.

Though he drew 46 percent of the vote, residents expressed striking unfamiliarity with him, even after a yearlong campaign.

The son a prominent judge, and a product of the Brooklyn Democratic machine, Mr. Thompson seemed to run a conventional municipal campaign designed for a previous decade, and rarely radiated political hunger. Those who backed the mayor pointed to the qualities that first won them over eight years ago, as he moved from the financial services empire he founded, Bloomberg L.P., to elective office: independence from campaign donors and a no-nonsense management style.

“I thing he’s doing a good job,” Luke Geissbuhler, 39, a cinematographer in Prospect Heights in Brooklyn, said. “It gives me great comfort that he’s less prone to be corrupt by way of his wealth.”

A little more than a year ago, the mayoral field was crowded with ambitious Democrats from City Hall to Congress. But once Mr. Bloomberg engineered the bid to overturn term limits, only Mr. Thompson remained, and for that act of political grit, he earned admiration, though not much public support, from the Democratic establishment.

Yet Mr. Thompson struggled to raise money, pulling in less than $6 million, and failed to communicate his central critique of the mayor: That Mr. Bloomberg had circumvented the will of the voters, who twice approved term limits, and ignored the welfare of working-class New Yorkers, favoring his wealthy friends and developers.

But Mr. Bloomberg was often more adept at framing the debate. He put Mr. Thompson on the defensive early on, challenging his record at the Board of Education and at the comptroller’s office. But what some voters seemed to really remember from the campaign was his spending; the mayor poured some $15,000 an hour into the race in the final months.

“The Yankees buy pennants and we buy mayoralties,” said Mr. Ficara, the Web developer from Prospect Heights.

Reporting was contributed by Flora Fair, Joel Stonington, Mathew R. Warren and Karen Zraick.

Researchers study three decades worth of data
by Lindsey Tanner
Associated Press

CHICAGO – Nearly half of all U.S. children and 90 percent of black youngsters will be on food stamps at some point during childhood, and fallout from the current recession could push those numbers even higher, researchers say.

The estimate comes from an analysis of 30 years of national data, and it bolsters other recent evidence on the pervasiveness of youngsters at economic risk. It suggests that almost everyone knows a family who has received food stamps, or will in the future, said lead author Mark Rank, a sociologist at Washington University in St. Louis.

“Your neighbor may be using some of these programs, but it’s not the kind of thing people want to talk about,” Rank said.

The analysis was released Monday in the November issue of Archives of Pediatrics and Adolescent Medicine. The authors say it’s a medical issue pediatricians need to be aware of because children on food stamps are at risk for malnutrition and other ills linked with poverty.

“This is a real danger sign that we as a society need to do a lot more to protect children,” Rank said.

Food stamps are a Department of Agriculture program for low-income individuals and families, covering most foods although not prepared hot foods or alcohol. For a family of four to be eligible, their annual take-home pay can’t exceed about $22,000.

According to a USDA report released last month, 28.4 million Americans received food stamps in an average month in 2008, and about half were younger than age 18. The average monthly benefit per household totaled $222.

Rank and Cornell University sociologist Thomas Hirschl studied data from a nationally representative survey of 4,800 American households interviewed annually from 1968 through 1997 by the University of Michigan. About 18,000 adults and children were involved.

Overall, about 49 percent of all children were on food stamps at some point by the age of 20, the analysis found. That includes 90 percent of black children and 37 percent of whites. The analysis didn’t include other ethnic groups.

The time span included typical economic ups and downs, including the early 1980s recession. That means similar portions of children now and in the future will live in families receiving food stamps, although ongoing economic turmoil may increase the numbers, Rank said.

An editorial in the medical journal agreed.

“The current recession is likely to generate for children in the United States the greatest level of material deprivation that we will see in our professional lifetimes,” Stanford pediatrician Dr. Paul Wise wrote.

Wise said the Archives study estimate is believable.

“I find it terribly sad, but not surprising,” Wise said.

James Weill, president of Food Research and Action Center, a Washington-based advocacy group, said the analysis underscores that “there are just very large numbers of people who rely on this program for a month, six months, a year.”

“What I hope comes out of this study is an understanding that food stamp beneficiaries aren’t them – they’re us,” Weill said.

The analysis is in line with other recent research suggesting that more than 40 percent of U.S. children will live in poverty or near-poverty by age 17; and that half will live at some point in a single-parent family. Also, other researchers have estimated that slightly more than half of adults will use food stamps at some point by age 65.

by Cal Thomas
The Spokesman-Review

“Don’t it always seem to go

Till it’s gone” – Joni Mitchell, “Big Yellow Taxi”

Some conservatives are prematurely salivating over President Obama’s declining poll numbers. According to a recent Gallup daily tracking poll, “the nine-point drop in the most recent quarter is the largest Gallup has ever measured for an elected president between the second and third quarters of his term, dating back to 1953.” That may comfort some Obama opponents, but three years is a long time until the next presidential election, so conservatives and Republicans (not always the same) had better think of a long-range strategy if they want to save the country from the long-term consequences of what many call “socialism.”

Matthew Spalding, of the Heritage Foundation, offers one component of that strategy in his new book, “We Still Hold These Truths: Rediscovering Our Principles, Reclaiming Our Future.” Spalding believes, “America is unique in that universal principles of liberty are the foundation of its particular system of government and its political culture.” He lists them and explains their history: liberty, private property, consent of the governed, equality, natural rights, religious freedom, rule of law, constitutionalism.

Middle-age and older Americans recall that these subjects were part of their high school and college curricula. Younger Americans may be less familiar with them, as the public schools no longer seem to emphasize what once held us together, preferring to teach “diversity” instead.

Six years ago, Sen. Lamar Alexander, a Tennessee Republican, introduced a bill to require a greater emphasis on American history and civics in public school classrooms. Alexander quoted federal Judge Aleta Trauger, who spoke at a swearing-in ceremony for 77 new citizens in Nashville: “We are Americans because we also share certain fundamental beliefs. We are bound together by the unique set of principles set forth in documents that created and continue to define this nation. We find our heritage and inspiration in the profound words of the Declaration of Independence: ‘All people are created equal and endowed with unalienable right to life, liberty and the pursuit of happiness.’ We pledge allegiance to the Republic as one nation under God, indivisible, with liberty and justice for all. But the greatest expression of our national identity is the Constitution of the United States, which established the responsibilities and rights that go with citizenship.”

All true in the past, but what if today’s schools no longer teach those principles and the Constitution is not supreme? What then?

Last week in New York City, the Children’s Scholarship Fund held a dinner in honor of Eva Moskowitz, who runs the Success Charter Network, which operates four charter schools serving about 1,500 students in Harlem. One of the speakers was Jaime Martinez, an eighth-grader who was rescued, along with his sister, Ashley, from a failing public school where he says he experienced bullying and fighting. Jaime’s grades are up at his Catholic private school; he sings in a choir and takes ballroom dancing lessons. (See his remarks at www.scholarshipfund.org.)

Children’s Scholarship Fund President Darla Romfo wants the education conversation to go “beyond arguments about vouchers, charter schools, and test scores into the newer territory of empowering parents and children with real information about how to choose schools and demand excellence, with the ultimate aim of expanding good options for every child.”

It is this objective that should be embraced by those wishing to “reclaim America,” not only for ourselves, but also for future generations.

If conservatives and Republicans support an exodus from public schools as a strategic goal, they will strike at the heart of liberalism, while simultaneously liberating minorities trapped in failed government schools. To free them and teach them about America and its promise of hope will produce everything they are looking for but can’t find in politics. It will also pay political dividends as children and their parents see which party and persuasion cares about them enough to bring real change to their lives.

It’s either this approach, with results, or continuing to put faith in politicians, who have proved themselves unworthy of such faith. If parents fail to act, they won’t know what they had till it’s gone.

Cal Thomas is a columnist for Tribune Media Services.

David G. Savage / Los Angeles Times September 10, 2009

WASHINGTON – The Supreme Court’s conservative bloc sounded poised Wednesday to strike down on free speech grounds a 100-year-old ban against corporations spending large amounts of money to elect or defeat congressional and presidential candidates.

If the justices were to issue such a ruling in the next few months, it could reshape American politics, beginning with the congressional campaign in 2010. Big companies and industries – and possibly unions as well – could fund campaign ads to support or defeat members of Congress.

Since 1907, federal law has prohibited corporations from giving money to candidates. And since 1947, corporations and unions have been barred from spending money on their own to urge voters to elect or defeat federal candidates. Corporate executives, as individuals, can contribute money to a corporate political action committee or PAC, but these amounts are relatively modest compared to the funds available to the corporate treasury.
At least 24 states have similar bans on corporate spending in state races.
All those spending limits have come under growing legal attack from conservatives and libertarians who say the government should not be allowed to set limits on campaign spending and electioneering, even when corporate or union money is in play.

Three justices – Antonin Scalia, Anthony Kennedy and Clarence Thomas – have already said they would overrule past decisions that had upheld federal and state restrictions on corporate election spending. Chief Justice John Roberts and Justice Samuel Alito also have said they favor free speech over the campaign funding limits. But they have not yet said whether they would go along and give corporations a free speech right to spend on campaign ads.

That was the issue before the court Wednesday. It was a rare re-argument in a seemingly narrow case of a small nonprofit group called Citizens United. It had produced a video called “Hillary: The Movie,” which was designed to undercut Hillary Rodham Clinton’s 2008 campaign for the presidency. However, it got tied up in a legal battle with the Federal Election Commission.

Because Citizens United is incorporated and received a small amount of corporate money, the group and its movie came under FEC regulation. Any amount of corporate money can trigger regulatory action under the election laws.
In March, the justices debated whether the law should apply to a nonprofit group that produced a campaign-related video. But rather than decide that narrow question, the justices said in June they would focus instead on whether to say that all corporations, like individuals, have a right to spend freely to elect or defeat candidates.

Washington lawyer Ted Olson, the former solicitor general under President George W. Bush, pressed the justices to rule broadly. “Corporations are persons entitled to protection under the First Amendment,” said Olson, who represented Citizens United.

Sens. John McCain, R-Ariz., and Russell Feingold, D-Wis., co-sponsors of the 2002 campaign funding law, were in the courtroom and listened intently to the 90-minute argument. The ruling could strike down part of the McCain-Feingold Act that restricted corporate and union-funded election ads in the months before the election.

The court will meet behind closed doors later this week to vote on the case. A decision could come within a few months.

By THOM SHANKER and MARK LANDLER

BRATISLAVA, Slovakia — Defense ministers from NATO on Friday endorsed the ambitious counterinsurgency strategy for Afghanistan proposed by Gen. Stanley A. McChrystal, giving new impetus to his recommendation to pour more troops into the eight-year-old war.

General McChrystal, the senior American and allied commander in Afghanistan, made an unannounced appearance here on Friday to brief the defense ministers on his strategic review of a war in which the American-led campaign has lost momentum to a tenacious Taliban insurgency.

“What we did today was to discuss General McChrystal’s overall assessment, his overall approach, and I have noted a broad support from all ministers of this overall counterinsurgency approach,” said NATO’s secretary general, Anders Fogh Rasmussen.

The acceptance by NATO defense ministers of General McChrystal’s approach did not include a decision on new troops, and it was not clear that their judgment would translate into increased willingness by their governments, many of which have been seeking to reduce their military presence in Afghanistan, to contribute further forces to the war.

But it was another in a series of judgments that success there could not be achieved by a narrower effort that did not increase troop levels in Afghanistan substantially and focused more on capturing and killing terrorists linked to Al Qaeda — a counterterrorism strategy identified with Vice President Joseph R. Biden Jr.

The NATO briefing, though held privately, thrusts General McChrystal back into the debate over what President Obama should do about Afghanistan — a role that has raised tensions between the general and the White House in the past, and even drawn a rebuke from his boss, Defense Secretary Robert M. Gates.

NATO’s support got no official reaction from the White House. But an administration official noted that an endorsement by defense ministers was not the same as an endorsement by the alliance’s political leadership. Other officials were emphatic that Mr. Obama would not be stampeded in his deliberations and suggested that the NATO statement should not be taken as evidence that the White House had made a decision about how to proceed.

“In no way, shape or form are the president’s options constrained,” said Richard C. Holbrooke, the administration’s special representative for Afghanistan and Pakistan, speaking to reporters at the State Department.

General McChrystal’s review calls for adopting a full-scale counterinsurgency strategy that would protect population centers and accelerate training of Afghan Army and police units — both of which would require significant numbers of fresh troops. NATO diplomats noted that it was difficult to see how an acceptance of this broad strategy could be viewed as anything but an endorsement of the need to increase both military and civilian contributions.

Mr. Gates, who has kept his views about additional troops close to his vest and has discouraged his commanders from lobbying too publicly for their positions, declined to be drawn out on this assessment.

“For this meeting, I am here mainly in listening mode,” Mr. Gates said in Bratislava after the NATO briefing, although he noted that “many allies spoke positively about General McChrystal’s assessment.”

Mr. Gates said the administration’s decision on Afghanistan was still two or three weeks away, and he cautioned that it was “vastly premature” to draw conclusions now about whether the president would deploy more troops. He said that allied defense ministers had not voiced concerns about the administration’s decision-making process.

Although NATO will not meet until next month to decide whether to commit more resources to Afghanistan, Mr. Gates did reveal that he had received indications that some allies were prepared to increase their contributions of civilian experts or troops, or both.

Britain and other NATO members have had their own fractious political debates over troop levels. A retired top general in Britain recently said that the government of Prime Minister Gordon Brown had rebuffed his requests for more troops, a charge Mr. Brown denied.

Separate from his strategic review, General McChrystal has submitted a request for forces, which is now working its way through both the American and NATO chains of command.

The options submitted by General McChrystal range to a maximum of 85,000 more troops, although his leading option calls for increasing forces by about 40,000, according to officials familiar with the proposal.

The pressure for more troops was a theme throughout the day at the NATO meeting, as other senior international representatives told defense ministers of the need to increase their commitments in order to succeed in Afghanistan.

The United Nations special representative for Afghanistan, Kai Eide, who also flew to the Slovakian capital to meet the ministers, stressed that “additional international troops are required.” He also told the allies, “This cannot be a U.S.-only enterprise.”

Mr. Eide acknowledged that it might be difficult to rally public support for force contributions while allegations of election fraud continued to taint the government of President Hamid Karzai.

Senior American military officers have already endorsed General McChrystal’s overall strategy, including Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, and Gen. David H. Petraeus, the American commander in the Middle East.

Senior NATO officials made clear that additional commitments should go beyond combat forces to include trainers for the Afghan Army and police force, as well as civilians to help rebuild the economy and restore confidence in the government.

“What we need is a much broader strategy, which stabilizes the whole of Afghan society, and this is the essence in the recommendations presented by General McChrystal,” said Mr. Rasmussen, the NATO secretary general. “This won’t happen just because of a good plan. It will also need resources — people and money.”

General McChrystal was not scheduled to make any public comments here. The general’s reticence was not unexpected, as some administration officials have criticized his recent statements as an attempt to press the White House to act.

The general and his aides have denied they were playing politics. General McChrystal said in a recent interview that success required a unified, government-wide strategy.

NATO officials assessing the potential for allied troop contributions said that delicate negotiations were under way, and that NATO capitals were watching the Obama administration for signals even while they sent signals of their own.

Thom Shanker reported from Bratislava, and Mark Landler from Washington.

by Charles Krauthammer
The Spokesman-Review

Rahm Emanuel once sent a dead fish to a live pollster.

Now he’s put a horse’s head in Roger Ailes’ bed.

Not very subtle. And not very smart. Ailes doesn’t scare easily.

The White House has declared war on Fox News. White House communications director Anita Dunn said that Fox is “opinion journalism masquerading as news.” Patting rival networks on the head for their authenticity (read: docility), senior adviser David Axelrod declared Fox “not really a news station.” And Chief of Staff Emanuel told (warned?) the other networks not to “be led (by) and following Fox.”

Meaning? If Fox runs a story critical of the administration – from exposing White House czar Van Jones as a loony Sept. 11 “truther” to exhaustively examining the mathematical chicanery and hidden loopholes in proposed health care legislation – the other news organizations should think twice before following the lead.

The signal to corporations is equally clear: You might have dealings with a federal behemoth that not only disburses more than $3 trillion every year but is extending its reach ever deeper into private industry – finance, autos, soon health care and energy. Think twice before you run an ad on Fox.

At first, there was little reaction from other media. Then on Thursday, the administration tried to make them complicit in an actual boycott of Fox. The Treasury Department made available Ken Feinberg, the executive pay czar, for interviews with the White House “pool” news organizations – except Fox. The other networks admirably refused, saying they would not interview Feinberg unless Fox was permitted to as well. The administration backed down.

This was an important defeat because there’s a principle at stake here. While government can and should debate and criticize opposition voices, the current White House goes beyond that. It wants to delegitimize any significant dissent. The objective is no secret. White House aides openly told Politico that they’re engaged in a deliberate campaign to marginalize and ostracize recalcitrants, from Fox to health insurers to the U.S. Chamber of Commerce.

There’s nothing illegal about such search-and-destroy tactics. Nor unconstitutional. But our politics are defined not just by limits of legality or constitutionality. We have norms, Madisonian norms.

Madison argued that the safety of a great republic, its defense against tyranny, requires the contest between factions or interests. His insight was to understand “the greater security afforded by a greater variety of parties.” They would help guarantee liberty by checking and balancing and restraining each other – and an otherwise imperious government.

Factions (political parties, interest groups etc. . . ) should compete, but also recognize the legitimacy of other factions and, indeed, their necessity for a vigorous self-regulating democracy. Seeking to deliberately undermine, delegitimize and destroy is not Madisonian. It is Nixonian.

But didn’t Teddy Roosevelt try to destroy the trusts? Of course, but what he took down was monopoly power that was extinguishing smaller independent competing interests. Fox News is no monopoly. It is a singular minority in a sea of liberal media. ABC, NBC, CBS, PBS, NPR, CNN, MSNBC vs. Fox. The lineup is so unbalanced as to be comical – and that doesn’t even include the other commanding heights of the culture that are firmly, flagrantly liberal: Hollywood, the foundations, the universities, the elite newspapers.

Fox and its viewers (numbering more than CNN’s and MSNBC’s combined) need no defense. Defend Fox compared to whom? To CNN – which recently unleashed its fact-checkers on a “Saturday Night Live” skit mildly critical of President Barack Obama, but did no checking of a grotesquely racist remark CNN falsely attributed to Rush Limbaugh?

Defend Fox from whom? Fox’s flagship 6 o’clock evening news out of Washington (hosted by Bret Baier, formerly by Brit Hume) is, to my mind, the best hour of news on television. (Definitive evidence: My mother watches it even on the odd night when I’m not on.) Defend Fox from the likes of Anita Dunn? She’s been attacked for extolling Mao’s political philosophy in a speech at a high school graduation.

But the critics miss the surpassing stupidity of her larger point: She was invoking Mao as support and authority for her impassioned plea for individuality and trusting one’s own choices. Mao as champion of individuality? Mao, the greatest imposer of mass uniformity in modern history, creator of a slave society of a near-billion worker bees wearing Mao suits and waving the Little Red Book?

The White House communications director cannot be trusted to address high schoolers without uttering inanities. She and her cohorts are now to instruct the country on truth and objectivity?

Charles Krauthammer is a columnist for the Washington Post Writers Group. His e-mail address is letters@charleskrauthammer.com.

By CARL HULSE

WASHINGTON — Representative Earl Blumenauer should be experiencing the most fulfilling days of his more than 35 years in public service.

The liberal Democrat from Portland, Ore. — known for his bowties, his Trek bicycle and a pragmatic brand of progressivism — embraced Barack Obama’s presidential candidacy early in 2008 and campaigned hard alongside him, steadily gaining confidence that the young senator from Illinois was the ideal liberal remedy to eight years of conservative dominance.

Now political reality has set in, testing Mr. Blumenauer’s faith that Mr. Obama’s election and big Democratic majorities in Congress would yield quick advances in the progressive agenda.

Instead of forging ahead, Mr. Blumenauer, 61, finds himself fighting to retain one of the touchstones for liberals this year, a public insurance option in the health care overhaul, and is watching his hopes of curbing global warming grow cold in the Senate. Mr. Blumenauer, a seven-term congressman, is bracing for a tough vote on sending more troops to Afghanistan while he frets about the detention facility at Guantánamo Bay remaining open.

“It has been a hard landing for a lot of the people that I represent,” Mr. Blumenauer, referring to his largely liberal constituency, said as he assessed the first months of the Obama administration.

As health care legislation moves to the floor with other major issues close behind, the question for Mr. Blumenauer and those who share his ideology will be whether they relent on some of their core beliefs to support less satisfying compromises, despite being in what, on the surface, is a commanding political position.

“It is still something that I am struggling with,” he said.

Mr. Blumenauer is just one example of what might be called the Frustrated Left, a substantial caucus of Congressional Democrats who dreamed that Mr. Obama would usher in a new era of liberal problem-solving only to see Congress and the new administration collide with the old problems of partisanship, internal disagreement and the challenge of mustering 60 votes to get just about anything done in the Senate.

While Congressional leaders try to appease moderate and conservative Democrats who can provide the crucial votes for passage, more liberal Democrats from safer districts sometimes simmer, feeling that they are being taken for granted while it is assumed they will get on board when the time comes.

On health care, Democrats are growing more optimistic that they can find a compromise approach to creating a government-run insurer to compete with the private sector — an issue that as much as any other has split the party’s liberals and moderates — even as progressive voices outside of Congress insist that there be no compromise.

“The fact is that Earl Blumenauer could stop a bill going through that does not have a public option in it,” said Jane Hamsher, founder of the progressive blog firedoglake.com. “Is it his loyalty to the party, partisan politics over principle? We are going to get to see that.”

Mr. Blumenauer strongly favors a public option and in late July was one of more than 60 Democrats who signed a letter to the leadership saying that, essentially, they would not back a final bill without an acceptable public plan. But on health care — as on other domestic issues, global warming and foreign policy — he must weigh whether it makes more sense to take what he can get as opposed to standing firm and perhaps seeing the overall effort collapse.

“It would be very hard for me to do,” Mr. Blumenauer said of voting for a final health care overhaul without a public plan. “But if it gets to the point where the choice is doing some things that will make a significant difference without a public option or letting the whole thing die, that too would be hard.”

Mr. Blumenauer got on board early with Mr. Obama after concluding that he offered the chance for a more decisive change in course than Hillary Rodham Clinton could provide. He first met Mr. Obama at the 2004 Democratic convention in Boston and endorsed him in late January 2008.

“There was something going on here, this guy has got some real capacity being able to, I think, connect, communicate,” remembered Mr. Blumenauer.

Mr. Obama won Oregon and Mr. Blumenauer’s district going away, setting sky-high expectations among his followers in the Pacific Northwest.

Mr. Blumenauer, a member of the tax-writing and climate change committees with a devotion to trying to improve the livability of American cities, said he did not think Mr. Obama had shifted his ideological stance since his election and did not blame the president for the problems slowing the liberal agenda. He said he saw a combination of factors — the troubled economy, the sheer scope of the nation’s problems and an unexpected level of Republican opposition — as the culprits.

“The combination of the economic shock and frankly the political upset and outrage has changed the landscape,” Mr. Blumenauer said. “The Barack Obama that I campaigned with is pretty much the same guy. But it is an environment that is unprecedented and would press anyone’s skills.”

Back home, Mr. Blumenauer said his constituents had shown patience with the pace of things, partly, he suggested, because they were so disenchanted with the Bush administration.

Activists and pollsters in Oregon said that they agreed but that the patience of Mr. Blumenauer’s liberal base was not unlimited.

“I think people realize you can’t do everything precisely all at once,” said Steve Novick, a Democratic advocate in Portland who lost a Senate bid in 2008.

Senator Ron Wyden, whose move to the Senate opened up the House seat for Mr. Blumenauer in 1996, said Oregon residents grasped the complexity of the problems facing the country. “Look at what is coming at us: Iraq, Afghanistan, Iran,” he said. “There is a sense that there is going to be a lot of heavy lifting, but people want to stay at it until it happens.”

Even with his frustrations, Mr. Blumenauer said that having a Democratic administration had paid tangible benefits. The secretaries of the housing and transportation departments have visited Portland, and he recently hosted Lisa P. Jackson, the administrator of the Environmental Protection Agency, in his office. “They want to be a partner on the cleanup rather than ignoring it,” he said, referring to environmental cleanup projects in his state.

And though some of his preferred legislative approaches might be stalled or fall victim to compromise, Mr. Blumenauer said he believed that Mr. Obama and the Democratic majorities in Congress would ultimately be successful in advancing a liberal agenda on the major issues.

“We are going to be working on climate, on health care, on the economy for every minute of the next two Congresses and beyond,” he said. “Will the public be patient enough? Will the political process hold together?

“This is not going to be easy,” he said, “but I think we are seeing a process that makes me actually optimistic, even though it is not exactly like I would have liked.”

By ROBERT PEAR and DAVID M. HERSZENHORN

WASHINGTON — After months of relentless courting and suspense, Senator Olympia J. Snowe, Republican of Maine, cast her vote with Democrats on Tuesday as the Senate Finance Committee approved legislation to remake the health care system and provide coverage to millions of the uninsured.

With Ms. Snowe’s support, the committee backed the $829 billion measure on a vote of 14 to 9, with all the other Republicans opposed.

“Is this bill all that I would want?” Ms. Snowe said. “Far from it. Is it all that it can be? No. But when history calls, history calls. And I happen to think that the consequences of inaction dictate the urgency of Congress to take every opportunity to demonstrate its capacity to solve the monumental issues of our time.”

Ms. Snowe’s remarks silenced the packed committee room, riveted colleagues and thrilled the White House. President Obama had sought her vote, hoping that she would break with Republican leaders and provide at least a veneer of bipartisanship to the bill, which he has declared his top domestic priority.

Mr. Obama, speaking in the Rose Garden, described the committee’s action as “a critical milestone” and declared, “We are now closer than ever before to passing health reform.” But he added: “Now is not the time to pat ourselves on the back. Now is not the time to offer ourselves congratulations. Now is the time to dig in and work even harder to get this done.”

With its vote Tuesday, the Finance Committee became the fifth — and final — Congressional panel to approve a sweeping health care bill. The action will now move to the floors of the House and the Senate, where the health care measures still face significant hurdles.

Aside from Ms. Snowe, no Republicans in Congress have publicly endorsed the bills in their current form. And Republican leaders are strongly opposed, saying the bills cost too much, raise taxes, cut Medicare and dangerously expand federal power.

Pressure from lobbyists is sure to grow in the coming weeks. And many more lawmakers will get involved in what promise to be impassioned and highly politicized debates in the Senate and the House.

After the Finance Committee vote, the chief architect of the bill, Senator Max Baucus, Democrat of Montana and chairman of the committee, declared: “It’s clear that health care reform will pass this year. Our action today provides terrific momentum.”

Senator Charles E. Grassley of Iowa, the senior Republican on the Finance Committee, said the bill put the nation on “a slippery slope toward more and more government control of health care.”

Ms. Snowe helped write the Finance Committee bill, in months of bipartisan negotiations, but had not committed to vote for it. She said Tuesday that she shared many of her Republican colleagues’ reservations about the legislation, and pointedly warned Democrats that they could lose her support later in the legislative process.

“My vote today is my vote today,” she said. “It doesn’t forecast what my vote will be tomorrow.” And she observed, “There are many, many miles to go in this legislative journey.”

Ms. Snowe gave no clue how she would vote in the first few hours of committee deliberations Tuesday and she did not alert the White House to her plans.

While colleagues spoke, she kept her head buried in papers, fidgeted and spoke occasionally with aides. When Mr. Baucus stepped over to speak to her, a small army of photographers snapped pictures, with cameras clicking like a chorus of chirping crickets.

The Congressional Budget Office said the bill would cost $829 billion over 10 years. The costs include $345 billion for the expansion of Medicaid and $461 billion for subsidies to help lower-income people buy insurance.

The budget office said the costs would be completely offset by new fees and taxes and by cutbacks in Medicare, so federal budget deficits in the next 10 years would be $81 billion lower than now projected.

But Douglas W. Elmendorf, director of the Congressional Budget Office, said his agency had not estimated the impact of the bill on overall national health spending, public and private, and could not say whether it would “bend the cost curve,” as Mr. Obama and lawmakers want.

Likewise, Mr. Elmendorf said he did not know for sure how the bill would affect premiums.

Several senators said they would fight for changes on the Senate floor.

Liberal Democrats, like Senator John D. Rockefeller IV of West Virginia, said they would push for a public insurance plan. Senators Ron Wyden of Oregon and Robert Menendez of New Jersey, both Democrats, said they would seek changes to make insurance more affordable to middle-income families. And Senator John Kerry of Massachusetts said he wanted to require employers to provide insurance to their employees.

The bill does not include such an employer mandate. But employers with more than 50 workers would have to reimburse the government for some or all of the cost of federal subsidies provided to employees who buy insurance on their own.

Ms. Snowe said she liked the Finance Committee bill because it would prohibit insurance companies from discriminating against people on account of health status or sex and would create a network of insurance exchanges where individuals, families and small businesses could shop for coverage, with subsidies from the federal government.

At the same time, Ms. Snowe said she shared Republican “concerns about vast governmental bureaucracies and governmental intrusions.” That, she said, is why she had opposed amendments to create a government insurance plan and would continue to do so.

Ms. Snowe said she was open to a compromise under which a public plan could be “triggered” in states where people could not otherwise find affordable insurance. She said her “paramount concern” was that insurance might be too expensive for some people, even with government subsidies.

The Congressional Budget Office said the Finance Committee bill would provide coverage to 29 million people, but still leave 25 million uninsured in 2019. Of those left uncovered, about a third would be illegal immigrants.

David Stout contributed reporting.

Point by point arguments on proposed community bill of rights
by Jonathan Brunt / jonathanb@spokesman.com, (509) 459-5442

Proposition 4 is the most debated and argued, hated and loved, vilified and oversimplified question on November’s ballot.

Supporters say the Community Bill of Rights – Proposition 4 on ballots that will be mailed later this week to voters in the city of Spokane – is an attempt to empower citizens to improve the environment, ensure housing and basic preventive health care, give neighborhoods a say in development projects and create an economy that has good jobs.

Opponents say the proposed amendments to the City Charter were written in a way to ensure constant lawsuits that will more likely halt progress on the goals listed in the proposition and will drive businesses and jobs from the city of Spokane to Spokane Valley or elsewhere.

Below is the wording from each of the nine rights in the Community Bill of Rights and statements from a debate at The Spokesman-Review this week:

Kai Huschke, the campaign manager for Envision Spokane, the group that successfully placed the proposal on the ballot.

Kate McCaslin, a former Spokane County commissioner, representing Jobs & Opportunities Benefiting Spokane, a group formed to oppose the measure.

Right 1

Residents have the right to a locally based economy to ensure local job creation and enhance local business opportunities. The right shall include the right to have local monies reinvested locally by lending institutions, and the right to equal access to capital, credit, contracts, incentives, and services for businesses owned by Spokane residents.

Supporters

The first amendment is about keeping money earned in Spokane in Spokane, Huschke said. That means requiring banks to use money from residents and businesses within city limits only on investments within the city of Spokane.

“If we are going to have a vibrant economy, we have to enhance our local economy,” Huschke said. “In order to do that, we have to make sure that we are treating our local businesses as best we can.”

Opponents

McCaslin said working for a locally based economy is positive, but not through a banking regulation that would create vast accounting headaches and likely lawsuits for lending institutions.

“This basically says people could sue the bank if they felt like those moneys were going outside Spokane,” McCaslin said, adding that banks might simply move outside city limits. “That will cost us jobs.”

Right 2

Residents have the right to affordable preventive health care. For residents otherwise unable to access such care, the City shall guarantee such access by coordinating with area health care providers to create affordable fee-for-service programs within 18 months following adoption of this Charter provision.

Supporters

Huschke said the city’s only duty under this provision is to convene a group of health care providers and to make a good-faith attempt to create the program.

“There is no cost to the city, plain and simple,” he said.

That’s because any administrative costs that might be created if health care providers successfully create a fee-for-service plan would be paid for by the fees, he said. Because most people who are uninsured have a source of income, fees could be charged to cover costs, he said.

“It was very, very critical to the people who formulated this that we didn’t build it such that there would be a cost to taxpayers,” Huschke said.

Opponents

McCaslin argues that the provision could easily be interpreted to mean that the city’s on the hook to provide preventive health care – whether or not the group of health care providers successfully creates the program.

And if a program is created, she said, there’s too much ambiguity about what’s required.

“Maybe what’s affordable to me is way different than what’s affordable to my neighbor, which is way different than is affordable to the neighbor down the street.”

She questioned who would pay for fees charged to patients who couldn’t afford them.

Right 3

Residents have the right to affordable housing, the right to a safely maintained dwelling, and the right to be free from housing discrimination. The City shall ensure the availability of low-income housing stock sufficient to meet the needs of the low-income housing community. People and families may only be denied renting or buying of a dwelling for non-discriminatory reasons and may only be evicted from their residence for non-discriminatory causes.

Supporters

Huschke said the provision could be met by the creation of regulations or incentives so that future housing developments include a certain percentage of low-income housing.

“It’s not about building houses; it’s about making sure that the stock of development is sufficient for the low-income community,” he said.

Opponents

McCaslin said if regulations or incentives fail to create enough low-income housing, the city could be forced into financing construction because it says the city “shall ensure the availability” of housing.

“These words are very specific,” she said. “The city could be on the hook for a lot of money.”

Right 4

Residents have the right to access affordable and renewable energy sources.

Supporters

“This would give residents the ability to actually generate their own energy if need be as well as to make sure that energy access stays affordable and renewable for the citizens of Spokane,” Huschke said. “If we’re going to play our part on a community level we need to have the ability to access renewable energy sources.”

Opponents

McCaslin said the rule likely would result in endless lawsuits.

“I just think that this is so open to interpretation that we are going to spend years and years and years trying to figure out what it means at great cost,” McCaslin said.

Right 5

Ecosystems, including but not limited to, all groundwater systems, surface water systems and aquifers, have the right to exist and flourish. River systems have the right to flow and have water quality necessary to provide habitat for native plants and animals, and to provide clean drinking water. Aquifers have the right to sustainable recharge, flow and water quality.

Supporters

Huschke said current environmental laws are “not giving us the level of protections we need.”

He noted studies that indicate that summertime flow of the Spokane River has fallen significantly in the past century – a development that puts strain on fish populations.

“This ups greater protections both from the pollution standpoint and from the flow standpoint,” he said.

As current law stands, a person concerned about an environmental problem often needs to have a financial interest in order to file a lawsuit, Huschke said.

This provision would do away with that requirement and make it possible for anyone to bring a suit.

Opponents

McCaslin said great improvements to the river and environment have occurred with current regulations and by “people working together.”

“We will all admit there are major issues that we need to address with our river and keep moving forward, but this is not the way to do and, in fact, could bring all of those efforts to a standstill,” McCaslin said.

McCaslin questioned the ability, as defined in the Ninth Amendment, allowing “anyone” to file a challenge.

“It really opens up the potential for vast amounts of litigation because you really don’t have to prove any standing, you just have to be a human to bring a lawsuit.”

Right 6

A neighborhood council may veto a land development project if requested to veto that project by a number of neighborhood registered voters equal to or greater than 15 percent of the total number of votes cast at the last preceding general municipal election within that neighborhood.  … A neighborhood council shall veto a land development project if requested to veto that project by a number of neighborhood registered voters greater than 50 percent of the total number of votes cast at the last preceding general municipal election within that neighborhood.  …

Supporters

Huschke noted that the city already has funded creation of some neighborhood plans, which become part of the city’s comprehensive plan – the city’s long-term growth guide. Continuing those efforts simply puts the city on a path of following through on promises officials made several years ago to craft development plans based on neighborhood input, supporters say.

Some neighborhood leaders have argued that developers’ vast resources and campaign contributions to City Council members unfairly tilt the process in their favor even if rules and zoning don’t favor their proposals. In development controversies in Spokane County, opponents have noted that even when neighbors successfully sued Spokane County for inappropriately approving development, the contested projects were vested under state law and were allowed to move forward even when deemed to have been illegally approved.

“Right now we don’t have the ability to actually uphold our plans on a neighborhood level. This is actually about empowering the residents to be able to do so,” Huschke said. “Until we as residents have the ability to actually call that into question through a legal manner we won’t have the ability to protect the integrity of our neighborhoods as we should.”

Opponents

McCaslin said if a law is approved requiring neighborhood planning, the cost to provide those services will pull from some other city priorities.

Most of the city’s funding for neighborhood plans thus far was paid for with surpluses experienced by the city before the recent recession.

“The point is that in a year like this, it could mean a decision between funding a police officer or a planning staff member,” McCaslin said.

McCaslin said provisions empowering neighborhood councils to veto a development project take away authority from leaders chosen by secret ballot in certified elections.

“We depend upon people who are formally elected through a process that we can trust,” McCaslin said. “It’s not just who shows up at a meeting one night and happens to get elected.”

She noted that the proposal is based on the number of voters who participated in the most recent city election. If turnout was closer to 30 percent, it would only take about 200 signatures in a neighborhood with 4,000 registered voters to give the neighborhood council veto power.

Opponents note that once a neighborhood council would veto a project it’s dead because there’s no provision to reverse course even if a majority of residents in the neighborhood sign a petition in support of the development.

Right 7

Workers have the right to be paid the prevailing wage on all private construction projects exceeding $2 million in construction costs (as annually adjusted for inflation), and all public and publicly subsidized construction projects, within the City of Spokane. Workers have the right to work as apprentices on all private construction projects exceeding $2 million in construction costs (as annually adjusted for inflation), and all public and publicly subsidized construction projects, through programs approved under the Washington State Apprenticeship Training Program, and each contractor and subcontractor building those projects shall be required to use apprentices for a minimum of 15 percent of the total hours worked on each project.

Supporters

Huschke said the rules are about “pay equity” and giving people opportunities to learn skills. They also would result in a better work force, one that is “more loyal, one that has less injuries,” he said.

“If you don’t give them opportunities to actually access jobs … in an apprentice program, you’re actually losing jobs because you don’t have the skill sets we need,” Huschke said.

Opponents

McCaslin said the rules will raise the cost of private construction, perhaps by 20 percent or more. That means, she said, jobs will be lost because some projects won’t move forward, at least not in the city of Spokane.

“I’ll tell you where they’re going to go and it’s not going to be in the city. Jobs will be lost. Property taxes in the future will be lost, and it will end up to be a great detriment to the city.”

Right 8

Workers have the right to employer neutrality when unionizing, and the right to be free from captive audience meetings, or other mandatory, non-work-related meetings, in the workplace.

Supporters

Union leaders have argued that federal law is slanted against unionization because of intimidation from employers, sometimes at “captive-audience” meetings where managers dissuade creation of a labor group.

Huschke said this rule would create an equal playing field.

“It doesn’t mean that employers can’t give their opinion, but they can’t block people from discussing the possibility of unionizing,” he said.

He added that employers could still hold meetings as long as employees aren’t punished for not attending.

“This is about having a freedom of choice,” he said.

Opponents

McCaslin argues that workers’ unionizing rights already are protected under federal law. Envision Spokane’s proposal, she said, would strip employer rights from the process.

“Employers would no longer have that option of talking about why their employees may not want to consider a union, and that is just unfair,” she said. “This alone will cost hundreds, if not thousands of jobs, in the city of Spokane as employers say, ‘You know what? I put everything at risk to have my small business. I do not think it is fair that I should not be able to talk to my employees about these issues,’ and they will simply leave.”

Right 9

All rights recognized by the Community Bill of Rights are fundamental, inalienable and self-executing. The City of Spokane, or any person, neighborhood, or neighborhood council aggrieved by a violation of their rights, or any person seeking to enforce the rights of ecosystems, may enforce these rights. Enforcement actions shall be filed as civil actions in a court of competent jurisdiction, against any person, government or entity violating these rights, and sufficient legal and equitable relief shall be awarded to remedy the violation, including restoration of a damaged ecosystem. In any action to enforce any Charter right, the court may allow the prevailing plaintiff a reasonable attorney’s fee and expert fees. Corporations and other business entities shall not be deemed to possess any legal rights, privileges, powers or protections which would enable those entities to avoid the enforcement of these rights, or which would enable them to nullify these rights.  …

Supporters

Huschke said, in part, the amendment aims to prevent corporations from overpowering the rights of citizens through power and wealth.

He agreed that rights could mean some businesses would leave the city, but those likely would be big-box stores that pay low wages, he said. Locally owned establishments would replace what leaves.

“If you want to continue to bring outside businesses to settle in here, yeah, those jobs are going to be gone, but they’re going to be replaced by a lot better jobs,” he said.

Opponents

McCaslin said it’s easy to vilify big corporations, but small businesses make up the bulk of the local economy and they too would be challenged by the rules and be just as likely to flee Spokane.

“If a community has a regulation that strips you of your rights, why would you ever be here?” she said. “It really undermines our business climate here, our ability to recruit business and frankly our ability to keep businesses here.”

October 10, 2009

By STEVEN ERLANGER and SHERYL GAY STOLBERG

PARIS — The choice of Barack Obama on Friday as the recipient of the 2009 Nobel Peace Prize, less than nine months into his eventful presidency, was an unexpected honor that elicited praise and puzzlement around the globe.

Normally the prize has been presented, even controversially, for accomplishment. This prize, to a 48-year-old freshman president, for “extraordinary efforts to strengthen international diplomacy and cooperation between peoples,” seemed a kind of prayer and encouragement by the Nobel committee for future endeavor and more consensual American leadership.

But the prize quickly loomed as a potential political liability — perhaps more burden than glory — for Mr. Obama. Republicans contended that he had won more for his star power and oratorical skills than for his actual achievements, and even some Democrats privately questioned whether he deserved it.

The Nobel committee’s embrace of Mr. Obama was viewed as a rejection of the unpopular tenure, in Europe especially, of his predecessor, George W. Bush.

But the committee, based in Norway, stressed that it made its decision based on Mr. Obama’s actual efforts toward nuclear disarmament as well as American engagement with the world relying more on diplomacy and dialogue.

“The question we have to ask is who has done the most in the previous year to enhance peace in the world,” the Nobel committee chairman, Thorbjorn Jagland, said in Oslo after the announcement. “And who has done more than Barack Obama?”

Still, Mr. Obama, who was described as “very surprised” when he received the news, said he himself was not quite convinced, adding that the award “deeply humbled” him.

“To be honest,” the president said in the Rose Garden, “I do not feel that I deserve to be in the company of so many of the transformative figures who have been honored by this prize, men and women who’ve inspired me and inspired the entire world through their courageous pursuit of peace.”

He said, though, that he would “accept this award as a call to action, a call for all nations to confront the challenges of the 21st century.” Mr. Obama plans to travel to Oslo to accept the award on Dec. 10. He will donate the prize money of $1.4 million to charity, the White House said.

Mr. Obama, only the third sitting American president to win the award, is suddenly put in the company of world leaders like Mikhail S. Gorbachev, who won for helping end the cold war, and Nelson Mandela, who sought an end to apartheid.

But less prominent figures have also won the award.

The reaction inside the administration was one of restraint, perhaps reflecting the awkwardness of winning a major prize amid a worldwide debate about whether it was deserved.

Republicans in Washington, reacting in disbelief, sought to portray Mr. Obama as unworthy. In an official statement, Michael Steele, chairman of the Republican National Committee, said, “The real question Americans are asking is, ‘What has President Obama actually accomplished?’ “

But there was much praise as well, even if Mr. Obama’s allies worried that the prize might be a liability and even if much of the praise came from Europe, giving ammunition to conservatives who say Mr. Obama cares too much about opinion there.

President Nicolas Sarkozy of France said the award marked “America’s return to the hearts of the world’s peoples,” while Chancellor Angela Merkel of Germany said it was an “incentive to the president and to us all” to do more for peace.

“In a short time he has been able to set a new tone throughout the world and to create a readiness for dialogue,” she said.

For a world that at times felt pushed around by a more unilateralist Bush administration, the prize for Mr. Obama seemed wrapped in gratitude for his willingness to listen and negotiate, as well as for his positions on climate change and nuclear disarmament.

Last year’s laureate, former President Martti Ahtisaari of Finland, saw the award as an endorsement of Mr. Obama’s goal of achieving Middle East peace.

“Of course, this puts pressure on Obama,” he said. “The world expects that he will also achieve something.”

The prize, announced as official Washington — including the president — was asleep, caught the White House off guard.

The first word of it came in the form of an e-mail message to the White House staff from the White House Situation Room, which monitors events worldwide around the clock, at 5:09 a.m. It carried the subject line “item of interest.”

Shortly before 6 a.m., the White House press secretary, Robert Gibbs, telephoned Mr. Obama, awakening him to share the news.

“There has been no discussion, nothing at all,” said the White House chief of staff, Rahm Emanuel.

The award comes at a time of considerable challenges for the president, with few sweeping achievements so far.

On the domestic front, he is pressing Congress to overhaul the nation’s health care system. In foreign affairs, he is wrestling with his advisers over how to chart a new course in Afghanistan and has been working, with little movement, to restart peace talks between Israelis and Palestinians.

The Rose Garden appearance was an example of Mr. Obama’s heavy workload; it was squeezed into a day that already included his regular intelligence and economic briefings, a private meeting with a senator, lunch with the vice president, a major speech outlining plans for a new consumer protection agency and a strategy session on Afghanistan with his national security team.

Announcing the award, the Nobel committee cited Mr. Obama “for his extraordinary efforts to strengthen international diplomacy and cooperation between peoples” and said that he had “created a new climate in international politics.”

In a four-paragraph statement, it praised Mr. Obama for his tone, his preference for negotiation and multilateral diplomacy and his vision of a cooperative world of shared values, shorn of nuclear weapons.

“Only very rarely has a person to the same extent as Obama captured the world’s attention and given its people hope for a better future,” the committee said. “His diplomacy is founded in the concept that those who are to lead the world must do so on the basis of values and attitudes that are shared by the majority of the world’s population.”

The other sitting American presidents to be given the award were Theodore Roosevelt in 1906, for negotiating an end to a war between Russia and Japan, and Woodrow Wilson in 1919, for the Treaty of Versailles.

Former President Jimmy Carter won in 2002 for his efforts over decades to spread peace and development. Mr. Carter called the award to Mr. Obama “a bold statement of international support for his vision and commitment.”

Former Vice President Al Gore won in 2007, sharing the prize with the Intergovernmental Panel on Climate Change, for his work on climate change. Mr. Gore called Mr. Obama’s award “well deserved” on Friday.

Mr. Obama has generated considerable goodwill overseas, with polls showing him hugely popular, and he has made a series of speeches with arching ambition. He has vowed to pursue a world without nuclear weapons; reached out to the Muslim world, delivering a major speech in Cairo in June; and sought to restart peace talks between Israel and the Palestinians, at the expense of offending some of his Jewish supporters.

But he has had to devote a great deal of his time to the economic crisis and other domestic issues, and many of his policy efforts are only beginning.

In addition to the challenges in Afghanistan and Pakistan, the situation in Iraq is extremely fragile; North Korea has staged missile tests; Iran continues to enrich uranium in defiance of United Nations Security Council resolutions, though it recently agreed to restart nuclear talks; Israel has resisted a settlement freeze; and Saudi Arabia has refused to make new gestures toward the Israelis.

Ahmed Youssef, a Hamas spokesman, congratulated Mr. Obama but said the prize was based only on good intentions. Muhammad al-Sharif, a politically independent Gazan, was incredulous. “Has Israel stopped building the settlements?” he asked. “Has Obama achieved a Palestinian state yet?”

The Nobel committee did not tell Mr. Obama in advance of the announcement, said its chairman, Mr. Jagland. “Waking up a president in the middle of the night,” he said, “this isn’t really something you do.”

Steven Erlanger reported from Paris, and Sheryl Gay Stolberg from Washington. Reporting was contributed by Walter Gibbs from Oslo, Alan Cowell from London, Nicholas Kulish from Berlin, Isabel Kershner from Jerusalem, and Taghreed El-Khodary from Gaza.

by Charles Krauthammer

The genius of democracy is the rotation of power, which forces the opposition to be serious – particularly about things like war, about which until Jan. 20 of this year Democrats were decidedly unserious.

When the Iraq war (which a majority of Senate Democrats voted for) ran into trouble and casualties began to mount, Democrats followed the shifting winds of public opinion and turned decidedly anti-war. But needing political cover because of their post-Vietnam reputation for weakness on national defense, they adopted Afghanistan as their pet war.

“I was part of the 2004 Kerry campaign, which elevated the idea of Afghanistan as ‘the right war’ to conventional Democratic wisdom,” wrote Democratic consultant Bob Shrum shortly after President Obama was elected.

“This was accurate as criticism of the Bush administration, but it was also reflexive and perhaps by now even misleading as policy.”

Which is a clever way to say that championing victory in Afghanistan was a contrived and disingenuous policy in which Democrats never seriously believed, a convenient two-by-four with which to bash George Bush over Iraq – while still appearing warlike enough to fend off the soft-on-defense stereotype.

Brilliantly crafted and perfectly cynical, the “Iraq war bad, Afghan war good” posture worked. Democrats first won Congress, then the White House. But now, unfortunately, they must govern. No more games. No more pretense.

So what does their commander in chief do now with the war he once declared had to be won but had been almost criminally under-resourced by Bush?

Perhaps provide the resources to win it?

You would think so. And that’s exactly what Obama’s handpicked commander requested on Aug. 30 – a surge of 30,000 to 40,000 troops to stabilize a downward spiral and save Afghanistan the way a similar surge saved Iraq.

That was more than five weeks ago. Still no response. Obama agonizes publicly as the world watches. Why? Because, explains national security adviser James Jones, you don’t commit troops before you decide on a strategy.

No strategy? On March 27, flanked by his secretaries of defense and state, the president said this: “Today I’m announcing a comprehensive new strategy for Afghanistan and Pakistan.” He then outlined a civilian-military counterinsurgency campaign to defeat the Taliban in Afghanistan.

And to emphasize his seriousness, the president made clear that he had not arrived casually at this decision. The new strategy, he declared, “marks the conclusion of a careful policy review.”

Conclusion, mind you. Not the beginning. Not a process. The conclusion of an extensive review, the president assured the nation, that included consultation with military commanders and diplomats, with the governments of Afghanistan and Pakistan, with our NATO allies and members of Congress.

The general in charge was then relieved and replaced with Obama’s own choice, Stanley McChrystal. And it’s McChrystal who submitted the request for the 40,000 troops, a request upon which the commander in chief promptly gagged.

The White House began leaking an alternate strategy, apparently proposed (invented?) by Vice President Joe Biden, for achieving immaculate victory with arm’s-length use of cruise missiles, Predator drones and special ops.

The irony is that no one knows more about this kind of warfare than Gen. McChrystal. He was in charge of exactly this kind of “counterterrorism” in Iraq for nearly five years, killing thousands of bad guys in hugely successful under-the-radar operations.

When the world’s expert on this type of counterterrorism warfare recommends precisely the opposite strategy – “counterinsurgency,” meaning a heavy-footprint, population-protecting troop surge – you have the most convincing of cases against counterterrorism by the man who most knows its potential and its limits. And McChrystal was emphatic in his recommendation: To go any other way than counterinsurgency would lose the war.

Yet his commander in chief, young Hamlet, frets, demurs, agonizes. His domestic advisers, led by Rahm Emanuel, tell him if he goes for victory, he’ll become LBJ, the domestic visionary destroyed by a foreign war. His vice president holds out the chimera of painless counterterrorism success.

Against Emanuel and Biden stand David Petraeus, the world’s foremost expert on counterinsurgency (he saved Iraq with it), and Stanley McChrystal, the world’s foremost expert on counterterrorism. Whose recommendation on how to fight would you rely on?

Less than two months ago – Aug. 17 in front of an audience of veterans – the president declared Afghanistan to be “a war of necessity.” Does anything he says remain operative beyond the fading of the audience applause?

Charles Krauthammer is a columnist for the Washington Post Writers Group. His e-mail address is letters@charleskrauthammer.com.

Inside the Supremes’ new term.

Published Sep 24, 2009 From the magazine issue dated Oct 5, 2009

Next week the Supreme Court will begin its 2009 term, secure in the knowledge that it remains completely misunderstood by the American public. A Gallup poll conducted in September showed the court’s current approval rating—61 percent—to be higher than it’s been in a decade. (Last year that number was 50 percent.) This fall, 50 percent of Americans believe the court is not too liberal or too conservative; that’s up from 43 percent last year. The number of Americans who believe the court is too conservative has dropped from 30 to 19 percent.

All this public admiration for the court’s moderation came the same week the court was hearing a campaign-finance-reform case that may dismantle a longstanding system of campaign-finance restrictions. The issue in Citizens United v. Federal Elections Commission is not limited to the constitutionality of the McCain-Feingold campaign-finance-reform law. The reason court watchers got so worked up about this case is that it squarely tests Chief Justice John Roberts’s stated commitments to preserving precedent, deferring to the elected branches, and issuing narrow rulings instead of sweeping ones. Oral arguments revealed that the court’s five conservatives feel nothing but contempt for campaign-finance regulations that demonize corporations, restrict core political speech, and—to quote the chief justice—”put our First Amendment rights in the hands of FEC bureaucrats.”

But that’s where the public confusion kicks in. In last term’s cases on voting rights, reverse discrimination, and a school strip search, the court opted for narrow, case-specific rulings rather than the sweeping ones foreshadowed by dramatic oral arguments. All this hardly means the 2008 term was a triumph for liberals at the high court. On balance, the term continued a clear trend in which big business always prevails, environmentalists are always buried, female and elderly workers go unprotected, death-row inmates get the needle, and criminal defendants are shown the door. So how to explain these new poll numbers showing that 49 percent of Republicans believe the Roberts Court is too liberal and 59 percent of Democrats believe the court is “about right”?

In part, the numbers reflect a focus on the wrong data; we continue to believe in the court we see on TV. Thus, the highly charged confirmation hearings of Justice Sonia Sotomayor this summer contributed to the idea that the court was swinging leftward, even though it’s clear that her substitution for Justice David Souter will do nothing to alter the balance of the court (indeed, she is generally expected to move the court to the right in some areas of criminal law). Similarly, the refusal of the court to go all the way in the big-banner civil-rights cases last year leads to the broad perception that the court is quite liberal.

To be sure, progressives who claim that the court’s eventual ruling in September’s campaign-finance fracas will conclusively reveal the heart of darkness that lurks inside the Roberts Court are also overstating their case. It’s true that the Roberts Court is a fundamentally conservative creature and will remain that way for the foreseeable future. But as we learned yet again last term, it’s also a court that is deeply aware of, even responsive to, public opinion. This is a court willing to reverse the Warren revolution with a tablespoon instead of a wrecking ball, and that may be too nuanced an approach to be captured in public-opinion polls.

The term that opens next week promises to provide another fistful of cases that will slowly deepen our understanding of the Roberts Court. Among them: yet another challenge to a cross on government property (raising questions about who has standing to be offended by religious symbols); a dispute over the constitutionality of a federal statute criminalizing depictions of animal cruelty; questions about whether juveniles may be sentenced to life without parole; another hot eminent-domain case; and maybe even a quarrel over whether the name “Washington Redskins” is offensive. If the tea leaves are correct, we may also see another confirmation hearing next summer.

As a generation raised on a constant diet of reality television and the inevitable “big reveal,” we will continue to look to the high drama of oral argument and the staged fireworks of judicial-confirmation hearings for our views about the Supreme Court. What really happens at the high court in the coming years will continue to occur by the tablespoon—even if we are too busy with imagined wrecking balls to see it.

October 4, 2009

By ROBERT PEAR and DAVID M. HERSZENHORN

WASHINGTON — With the Senate Finance Committee set to approve its health care bill this week, Democrats are tantalizingly close to bringing legislation that would make sweeping changes in the nation’s health care system to the floor of both houses of Congress.

Party leaders still face immense political and policy challenges as they combine rival proposals — two bills in the Senate and three in the House. But the broad contours of the legislation are in place: millions of uninsured Americans would get subsidized health benefits, and the government would move to slow the growth of health spending.

Senior Democrats said they were increasingly confident that a bill would pass this year. “I am Scandinavian, and we don’t like to overstate anything,” said Senator Kent Conrad, Democrat of North Dakota and an architect of the Finance Committee bill. “But I have a solid feeling about the direction of events.”

President Obama, in his weekly address on Saturday, noted Friday’s dismal unemployment numbers and said the health care overhaul would bolster small businesses and create jobs.

Mr. Obama called the overhaul “a critical step in rebuilding our economy” and said he was working with his economic advisers “to explore additional options to promote job creation.”

Step by difficult step, the legislative process is lurching forward. Proponents say they see some momentum — more than they saw in Congress 15 years ago, when President Bill Clinton’s plan for universal health coverage collapsed.

As Senate Democrats try to secure the 60 votes needed to overcome a possible Republican filibuster, intricate details and big hurdles stand in their way. Republicans have said they will fight the legislation at every turn.

The policy challenges are also daunting. In the space of one year, the Democrats are trying to restructure one-sixth of the economy, writing a bill that will affect almost every American, every business and every doctor and hospital in the country.

Three House committees approved health care bills in July, as did the Senate health panel. After hearing from constituents in August — some furious, some pleading for change — many Democrats returned to the Capitol determined to plow ahead. They were also emboldened by Mr. Obama’s speech to Congress on Sept. 9 that cast the legislation as a moral and political imperative.

The Finance Committee is expected to approve its bill this week, after receiving cost estimates from the Congressional Budget Office. And while the panel made numerous changes over seven days of public debate, the core components of its more centrist proposal, developed in months of bipartisan talks, are still intact.

After the committee votes, a new, potentially more perilous phase will begin as party leaders put together the final proposals they will take to the floor of the Senate and the House.

These are some of the huge issues that remain:

¶The major House and Senate bills would require most Americans to carry insurance. This individual mandate could touch off an angry public reaction, especially if the penalties for violations are taxes collected by the Internal Revenue Service. Many lawmakers want to minimize the penalties.

¶Whether the government should require employers to provide health benefits to their employees, or pay a penalty, is still an open question. Liberal Democrats say yes. Moderate Democrats are unsure. Republicans are generally opposed.

¶Lawmakers have not decided how to pay for the legislation, expected to cost about $900 billion over 10 years, though they insist that it will not add to the deficit. The House has proposed a surtax on high-income people, while the Senate proposed an excise tax on high-cost insurance plans.

¶Democrats are divided over whether to create a government insurance company to compete with private insurers. The more liberal House will probably not pass a health care bill without such a public insurance option, while the Senate appears unlikely to pass one with it.

¶Lawmakers are looking for ways to provide more generous subsidies to help low- and middle-income people buy insurance. Many Democrats and some Republicans, like Senator Olympia J. Snowe of Maine, insist that insurance must be affordable if people are required to buy it.

¶While Congressional leaders say they want to curb the explosive growth of health costs, it is unclear whether the final bill will make a serious effort to do so. Every proposal meets resistance from health care providers who fear a loss of income, even as they stand to gain millions of paying customers if nearly everyone has insurance.

Mr. Conrad said that even some Republicans seemed to recognize the likelihood that Congress would pass major health care legislation this year. “I thought there was an air of resignation that settled over our colleagues on the other side of the aisle,” he said.

But Senator Lamar Alexander of Tennessee, the No. 3 Republican in the Senate, predicted that opposition would grow. “It would be very difficult for a bill like the Finance Committee bill to pass the Senate,” he said. “There is nothing inevitable about such a bill. There is nothing predictable about the Senate floor.”

Republicans are not waiting for the finished product and have unleashed a barrage of criticism. In addition to expanding government and raising taxes, they say, the Democratic plans will hurt older Americans by cutting Medicare, intrude on personal freedom by forcing people to buy insurance and impose new costs on states by expanding Medicaid.

Democrats said that once the Finance Committee acts this week, they will be closer than ever to carrying out a major overhaul of the health care system — a goal that has eluded presidents and Congress for more than a half-century.

October 3, 2009

By JULIET MACUR

COPENHAGEN — When Rio de Janeiro was elected host city for the 2016 Olympic Games on Friday, the room where its bid team gathered turned into a boisterous party with members in uniform navy or moss green blazers hugging, dancing, crying and waving Brazilian flags. The bid leader, Carlos Arthur Nuzman, yelled, “We did it! We did it!”

Rio and Chicago had gone into the day considered the favorites, ahead of Tokyo and Madrid. But by the time Rio was chosen by the International Olympic Committee to become the first South American city to host the Olympics, the Chicago delegation and its star-studded supporters were nowhere in sight.

They had already left the building.

Despite the support of President Obama, who flew in specifically to address the I.O.C. voters, Chicago finished last, out of the running in the first round of voting, with a paltry 18 of a total 94 votes. Tokyo received 22, with Rio getting 26 and Madrid 28. In each round, until one city gains a majority, the low vote-getter is eliminated. After Chicago was tossed aside, nearly all of its votes went straight to Rio in the second round. In the third, after Tokyo was eliminated, Rio won handily, 66-32.

The chance to bring the Olympics to a continent that had never hosted the Games worked in Rio’s favor. During its presentation, the bid team showed a graphic of the world and marked all the places that have held an Olympics. South America was glaringly bare.

“There was absolutely no flaw in the bid,” the I.O.C. president, Jacques Rogge, said.

Chicago officials had worked nearly four years and spent nearly $50 million to bring the Summer Olympics to the United States for the first time since the 1996 Atlanta Games. There were many possible explanations for Chicago’s spectacular failure, but little consensus.

Some pointed to the regional bloc voting in the treacherous first round. Others said some voters, assuming Chicago was a lock to advance because of the presence of Mr. Obama and his wife, Michelle, might have taken their early votes elsewhere. Many also blamed the rocky relationship between the United States Olympic Committee and the I.O.C.

Others said there was no explaining it.

“Everybody was shocked at that result,” said Rene Fasel, an I.O.C. member from Switzerland, regarding Chicago’s first-round ouster. “Everybody expected Chicago and Rio, everybody. It was really strange, and I feel really sorry. If it would have been Chicago and Rio in the end, it would have been much closer.”

Anita DeFrantz, one of two I.O.C. members from the United States, said she could not believe how the vote unfolded, particularly after the Obamas’ visit. “I hate the fact that these elegant people were here and then our country got treated that way,” she said.

Beyond showing an apparent indifference to the United States’ star power, the I.O.C. vote was interpreted as a repudiation of the U.S.O.C., which has been in upheaval over the past year and has struggled to gain a favorable standing within the I.O.C.

“It was a defeat for the U.S.O.C., not for Chicago,” said Denis Oswald, an I.O.C. member from Switzerland.

Mr. Oswald said that 10 to 15 fellow I.O.C. members had approached him recently wanting to discuss issues related to the U.S.O.C. He said that changes in U.S.O.C. leadership “has not helped,” either, and that it was clear that the Chicago bid and the U.S.O.C. were not united. Stephanie Streeter, the acting chief executive of the U.S.O.C., and Larry Probst, the committee’s chairman, have taken their posts in the last year and have run into problems with the I.O.C., most notably over their stalled plan for an Olympic television network and their share of the Games’ network and corporate sponsorship contracts.

“The United States, within the Olympic movement, hasn’t engaged as well as we could have for a long time,” said Robert Ctvrtlik, the U.S.O.C. vice president for international relations. “There’s a lot of politics going on. This isn’t just on the merits. I don’t think it’s anti-American. Maybe we still don’t have the horsepower to do some of the politicking within the movement.”

For the first time, a United States president met with the I.O.C. on behalf of an American bid — which U.S.O.C. officials called the country’s strongest bid ever — but that was not enough. This followed New York City’s failed bid for the 2012 Summer Games, a second-round exit after winning only 19 votes.

“All we know is that the first round is always the most dangerous and obviously we didn’t have a large region of support,” Chicago’s bid leader, Patrick G. Ryan, said. “We wanted to bring home the victory and we didn’t. It wasn’t our day.”

On his flight back to Washington on Friday, Mr. Obama said he was disappointed about Chicago’s finish.

“I have no doubt that it was the strongest bid possible and I’m proud that I was able to come in and help make that case in person,” Mr. Obama said after arriving back in Washington.

In Rio, officials declared a holiday for city and state employees. While tens of thousands of people had begun the celebration on the city’s Copacabana beach, where people dressed in shorts and bikinis jumped to samba music, the scene was different earlier in Chicago.

All over the city, people responded to the city’s elimination with astonished silence, blank looks and questions. The word there had been that Chicago would survive at least until a late round of voting, if not win. Planned celebrations at schools, parks and restaurants ended abruptly Friday morning.

“It’s sad,” said Marshall Burt, a lawyer, as he stood in Daley Plaza, in the heart of Chicago’s Loop, where thousands had gathered for what they expected to be a victory rally. “But I think probably the world is still not real keen on America.” He added later, “Chicago may still have the image of gangsters and corruption.”

The I.O.C. member Kevan Gosper, of Australia, said the few votes cast for Chicago could have been an accident. “There might have been an effort on the part of the Asian group to protect Tokyo in the first round,” he said.

Richard W. Pound, an I.O.C. member from Canada, said that Chicago might have been eliminated early on purpose. “I think there were a lot of people saying, if we don’t get it, we’ll support you, but we’ve got to stop Chicago,” he said. “That’s sport politics, not anything else. It’s election management. The Europeans and the Asians are much better at this than we are.”

Some members of the Olympic movement in the United States said they were bracing for this moment.

Skip Gilbert, the chief executive of USA Triathlon and the chairman of the National Governing Bodies Association, said he planned to meet with other executives at national governing bodies to decide what to do next. One option would be to recommend a change in leadership, he said.

“I think it comes down to when you have a leadership that has no real connection to the Olympic movement before they walk into their roles, what would you expect that they’re going to be able to do in terms of being leaders of an Olympic movement?” he said. “Unfortunately it seems like — and the vote kind of confirms it — that we were doomed to fail from the beginning.”

Still, Chicago planned for victory. The bid team reserved a hall in downtown here, where they had planned to celebrate with about 500 supporters. When the team arrived, the crowd began singing “The Star-Spangled Banner,” said Michael Plant, a U.S.O.C. board member here as part of Chicago’s delegation.

Geography, though, was Rio’s strongest point. It helped the city overcome concerns about security in the Brazilian city. There were also concerns that the country would be overextended because it is hosting the 2014 World Cup.

It helped Rio that the I.O.C. has a history of trying to effect change with its choices for bid cities. The committee awarded the 2008 Summer Games to Beijing, hoping to help open China to the world. In 1981, it gave the 1988 Summer Games to Seoul to help usher in a civilian government.

By choosing Rio, it could help the country develop faster and could bring an entire continent of people closer to the Olympic movement.

“Today is the most emotional day in my life, the most exciting day of my life,” President Luiz Inácio Lula da Silva of Brazil said. “I’ve never felt more pride in Brazil. Now, we are going to show the world we can be a great country. We aren’t the United States, but we are getting there, and we will get there.”

Monica Davey contributed reporting from Chicago; Alexei Barrionuevo from Rio de Janeiro; and Richard Sandomir, Katie Thomas and Lynn Zinser from New York.

October 3, 2009

By PETER S. GOODMAN

After several months in which the American economy flashed tentative signs of improvement, a sobering report on the national job market released on Friday amplified worries that a lengthy period of lean times lay ahead.

The economy shed 263,000 jobs in September, and the unemployment rate edged up to 9.8 percent from 9.7 percent in August, according to the Labor Department’s monthly snapshot of the employment picture.

Though the job market worsened, the pace of deterioration remained markedly slower than during the early months of the year, when roughly 700,000 jobs a month were disappearing. That improvement seems consistent with the widespread belief that the recession has given way to economic growth. Yet the report also buttressed fears that economic expansion would be weak and hesitant, with scarce paychecks and economic anxiety remaining prominent features of American life well into next year.

“This is a weak report,” said Stuart G. Hoffman, chief economist at the PNC Financial Services Group in Pittsburgh. “The rate of job loss has tapered off, but we still haven’t reached the point where businesses are willing to hire.”

The Labor Department also made a preliminary revision in its survey of private employers that indicated the job market shrank even more during the recession. The department disclosed that in March this year the economy held 824,000 fewer jobs than previously reported, making an already bleak picture worse.

The endurance of hard times seems likely to increase pressure on the Obama administration and Congress to consider another dose of spending aimed at stimulating the economy, even as the government grapples with deficits projected by some economists to exceed $10 trillion over the next decade.

Despite a $787 billion stimulus package adopted early this year and aimed in part at shoring up state and local coffers, government jobs slipped by 53,000 in September.

“That’s the budget crunch hitting,” said Dean Baker, co-director of the Center for Economic and Policy Research in Washington. “We’re still losing jobs at a very rapid pace. We’re still looking at an economy with a lot of weakness.”

For millions of unemployed people, the latest data merely confirms something they have come to understand intimately, through the discouraging process of seeking work.

“There’s nothing out there,” said Jerry Lamirande, a technology systems engineer in Amarillo, Tex., who has been without a job since April 2008.

During the technology boom of the late 1990s, Mr. Lamirande, 62, worked for I.B.M., where he drew a salary of about $130,000. After a layoff seven years ago, he has earned about $70,000 a year as a technology consultant working on contract.

Since the spring, he and his wife have lived on her modest salary as a public school teacher and on hardship withdrawals from his retirement account. He has searched nationwide for his next contract, willing to relocate.

“I’ve got to go where the opportunities are,” he said. “The problem is, there aren’t many opportunities.”

The latest jobs report lent credence to that contention. The unemployment rate continued to inch toward double digits, a level last seen in June 1983. The so-called underemployment rate (which includes people whose hours have been cut, and those working part-time for lack of full-time positions, along with the jobless) reached 17 percent, the highest level since the government began tracking it in 1994.

More jobs were lost last month, at 263,000, than were lost in August, as the Labor Department revised the August decline to 201,000 jobs from the 216,000 it initially reported.

Health care remained a rare bright spot, adding 19,000 jobs in September, but construction jobs slipped by 64,000, manufacturing declined by 51,000 and retail lost 39,000 jobs.

Most economists assume the economy expanded at an annual pace of about three percent from July through September. But debate focuses on the vigor and staying power of the recovery.

Optimists anticipate a robust bounce-back from what now stands as the longest recession since the Great Depression. But most economists expect a sustained slog through high rates of joblessness.

The economic improvement in recent months largely stems from businesses cutting inventories at a slower pace. As some companies begin to rebuild stocks, the impact could wash through the economy for a few more months, adding jobs and moderating the overall decline.

Then the underlying weakness of the economy will probably reassert itself, say experts. After years of borrowing against homes and cashing in stock to spend in excess of their incomes, many Americans are tapped out. Austerity and saving have replaced spending and investment in many households, constraining the economy.

As many Americans transition from living on home equity loans to sustaining themselves on paychecks, weekly pay continues to effectively shrink: Over the last year, average hourly earnings for rank-and-file workers — some 80 percent of the labor force — have increased by 2.5 percent. But average weekly earnings have expanded by only 0.7 percent, less than the increase in the cost of living, because employers have slashed working hours.

In September, the average workweek edged down by one-tenth of an hour, to 33 hours.

For those out of work, the job market looks harsher now than at any point in the recession. The number of people who have been jobless for more than six months increased in September by 450,000, reaching 5.4 million.

“We have a truly massive crisis of long-term unemployment,” said Christine L. Owens, executive director of the National Employment Law Project in a statement, adding that nearly 400,000 jobless people had exhausted their unemployment benefits by the end of September. “Today’s employment report is a marching order for Congress to pass unemployment benefit extensions to all states, quickly.”

The first signs of improvement are likely to be seen among temporary workers, say experts, as companies now hunkering down in the face of uncertain prospects take tentative steps to expand.

But temporary help services lost 1,700 jobs in September.

“Companies are extremely cautious,” said Roy G. Krause, chief executive of Spherion, a recruiting and staffing company based in Fort Lauderdale, Fla.

All of which translates into continued apprehension in many households.

“It’s terrifying,” said Stephanie Wheeler, 56, of Elizabeth, N.J., who has drained her savings to $800 in the year since she lost her job at a data-processing company, rendering her ability to pay the rent on her apartment uncertain.

“I’ve been here for eight years,” she said. “I don’t know what’s going to happen. I’m petrified of being set out on the street.”

Jack Healy contributed reporting.

If Congress fails to act, agency plans to proceed
Jim Tankersley / Tribune Washington bureau

Tags: climate change Environmental Protection Agency global warming

WASHINGTON – The Environmental Protection Agency on Wednesday unveiled a detailed proposal for using the government’s regulatory powers to curb greenhouse gas emissions – reassuring foreign allies on the U.S. commitment to fight climate change and warning Congress that the administration will act on its own if lawmakers fail to address the issue.

The proposed regulations would apply to large-scale industrial sources of heat-trapping gases, including power plants, factories and refineries, but not to smaller sources, such as new schools, as some critics of the EPA action had feared.

The rules would force new – or substantially modified – industrial emitters to employ “best available control technologies and energy efficiency measures” to minimize greenhouse-gas emissions, a tougher standard than the one applied to many emitters now.

The EPA action, along with the formal unveiling of proposed legislation in the Senate, stoked optimism among environmentalists and others who have voiced concern that the chances for agreement at a global warming conference in Copenhagen could be reduced if leaders of other countries concluded the U.S. was not prepared to take the kinds of steps it has urged other developed nations to take.

“We are not going to continue with business as usual while we wait for Congress to act,” EPA Administrator Lisa P. Jackson told a climate conference in Los Angeles. She said the proposal “allows us to do what the Clean Air Act does best – reduce emissions for better health, drive technology innovation for a better economy, and protect the environment for a better future – all without placing an undue burden on the businesses that make up the better part of our economy.”

EPA officials unveiled the proposal as international climate negotiators gathered in Bangkok to prepare for global warming treaty talks in Copenhagen in December.

The EPA rules would mimic how the agency forces power plants and factories to install “scrubbers” and other means of limiting many types of air pollutants.

But it’s unclear exactly how that would apply in the case of greenhouse gases, which scientists blame for climate change. Researchers are still studying and have yet to deploy a commercial-scale method to capture and store carbon emissions from coal plants, for example.

The EPA proposal, which must now move through a lengthy process of comments and reviews, is likely to encounter legal challenges.

Hearing could test reach of Second Amendment
Robert Barnes / Washington Post

Tags: gun rights u.s. supreme court

Associated Press The Supreme Court sits for a group photograph Tuesday ahead of the new session. The justices are: Samuel Alito Jr., Ruth Bader Ginsburg, Stephen Breyer, Sonia Sotomayor, Anthony M. Kennedy, John Paul Stevens, Chief Justice John G. Roberts, Antonin Scalia and Clarence Thomas.

WASHINGTON – The Supreme Court set up a historic decision on gun control Wednesday, saying it will rule whether restrictive state and local laws violate the Second Amendment right to gun ownership that it recognized last year.

The landmark 2008 decision to strike down the District of Columbia’s ban on handgun possession was the first time the court had said the amendment grants an individual right to own a gun for self-defense. But the 5-to-4 opinion in District of Columbia v. Heller did not address the question of whether the Second Amendment extends beyond the federal government and federal enclaves such as Washington, D.C.

Most court observers think that the five justices who recognized the individual right will also find that the Second Amendment applies to state and local governments, a move that could spark challenges of state and local laws governing gun registration, how and when the weapons can be carried, and storage requirements.

The court will hear a challenge of handgun laws in Chicago and the neighboring village of Oak Park, Ill. It was filed by Alexandria, Va. attorney Alan Gura, who successfully argued the Heller case. He said the Chicago ban is “identical” to the one found unconstitutional in the District.

The announcement came as the court prepared for its new term, which will officially begin on Monday. Justices sifted through more than 2,000 petitions accumulated through the summer and selected 10 to hear.

Also on the list was an examination of an anti-terrorism statute, widely used by federal prosecutors, that bans material support to groups that the State Department designates as terrorism organizations.

Solicitor General Elena Kagan told the court that the law is a “vital part of the nation’s effort to fight international terrorism,” but a lower court said some of the statute was unconstitutionally vague.

The decision to accept the Chicago gun case was a natural progression from the decision in Heller, which split the court on ideological grounds. The liberal justices said the Second Amendment guaranteed only a collective right for gun ownership to maintain militias.

If the amendment is extended, the next question will be about the kind of restrictions allowed. The Heller opinion by Justice Antonin Scalia said some requirements would be constitutional, but it was not specific.

Gura hopes for a “definitive ruling” on Chicago’s restrictions, and said he thinks that at a minimum the court would strike the same kind of handgun ban it found objectionable in Washington.

But gun-control advocates played down the importance of the case, saying few states or municipalities had such restrictive laws. Only a handful of states do not protect gun ownership in their constitutions, and 33 filed a brief advocating that the court find that the Second Amendment applies to them.

“Even if the court were to hold the Second Amendment applicable to states and localities, such a ruling is unlikely to change the crucial holding by the Supreme Court in Heller that a wide range of reasonable gun laws are presumptively constitutional, and that the Second Amendment right is narrowly limited to guns in the home for self-defense,” said Paul Helmke, president of the Brady Campaign to Prevent Gun Violence.

The method by which the court might apply the Second Amendment is what interests constitutional scholars. The Bill of Rights originally was thought to be a restriction on the federal government, a perception furthered by a 19th Century court ruling that differentiated between state and federal rights.

Since then, the court has gradually applied most of the 10 amendments to the states in a process called “incorporation,” but not the Second Amendment.

Gura is supported by liberal and conservative scholars who say the issue should be taken care of by the post-Civil War 14th Amendment, which says a state may not “abridge the privileges and immunities” of citizens nor deprive liberty “without due process of law.”

Clark Neily, a senior lawyer at the conservative Institute for Justice, said in a statement: “This case is about more than guns – it is about whether the Supreme Court should interpret the Constitution as the powerful protection of liberty it was intended to be. His organization sees the “privileges and immunities” clause as a protector of “economic liberty” and “armed self-defense.”

Liberal scholars such as Doug Kendall of the Constitutional Accountability Center consider the clause an “explicit protection for substantive liberty that would reinforce the constitutional underpinnings of Roe v. Wade and the court’s ruling protecting sexual autonomy for gays and lesbians.”

Justice Sonia Sotomayor was part of a panel on the U.S. Court of Appeals for the 2nd Circuit that said in an unrelated case that only the Supreme Court could decide whether the Second Amendment applies beyond the federal confines. Because the court accepted the case from the U.S. Court of Appeals for the 7th Circuit, she is free to participate.

The case is McDonald v. Chicago. The earliest it would be argued is Jan. 11.

Talks will address new nuclear facility

by David S. Broder

David Broder is a columnist for the Washington Post. His e-mail address is davidbroder@washpost.com.

My mother wanted to die, but the doctors wouldn’t let her. At least that’s the way it seemed to me as I stood by her bed in an intensive-care unit at a hospital in Hilton Head, S.C., five years ago. My mother was 79, a longtime smoker who was dying of emphysema. She knew that her quality of life was increasingly tethered to an oxygen tank, that she was losing her ability to get about, and that she was slowly drowning. The doctors at her bedside were recommending various tests and procedures to keep her alive, but my mother, with a certain firmness I recognized, said no. She seemed puzzled and a bit frustrated that she had to be so insistent on her own demise.

The hospital at my mother’s assisted-living facility was sustained by Medicare, which pays by the procedure. I don’t think the doctors were trying to be greedy by pushing more treatments on my mother. That’s just the way the system works. The doctors were responding to the expectations of almost all patients. As a doctor friend of mine puts it, “Americans want the best, they want the latest, and they want it now.” We expect doctors to make heroic efforts—especially to save our lives and the lives of our loved ones.

Compared with other Western countries, the United States has more health care—but, generally speaking, not better health care. There is no way we can get control of costs, which have grown by nearly 50 percent in the past decade, without finding a way to stop overtreating patients. In his address to Congress, President Obama spoke airily about reducing inefficiency, but he slid past the hard choices that will have to be made to stop health care from devouring ever-larger slices of the economy and tax dollar. A significant portion of the savings will have to come from the money we spend on seniors at the end of life because, as Willie Sutton explained about why he robbed banks, that’s where the money is.

As President Obama said, most of the uncontrolled growth in federal spending and the deficit comes from Medicare; nothing else comes close. Almost a third of the money spent by Medicare—about $66.8 billion a year—goes to chronically ill patients in the last two years of life. This might seem obvious—of course the costs come at the end, when patients are the sickest. But that can’t explain what researchers at Dartmouth have discovered: Medicare spends twice as much on similar patients in some parts of the country as in others. The average cost of a Medicare patient in Miami is $16,351; the average in Honolulu is $5,311. In the Bronx, N.Y., it’s $12,543. In Fargo, N.D., $5,738. The average Medicare patient undergoing end-of-life treatment spends 21.9 days in a Manhattan hospital. In Mason City, Iowa, he or she spends only 6.1 days.

Maybe it’s unsurprising that treatment in rural towns costs less than in big cities, with all their high prices, varied populations, and urban woes. But there are also significant disparities in towns that are otherwise very similar. How do you explain the fact, for instance, that in Boulder, Colo., the average cost of Medicare treatment is $9,103, whereas an hour away in Fort Collins, Colo., the cost is $6,448?

The answer, the Dartmouth researchers found, is that in some places doctors are just more likely to order more tests and procedures. More specialists are involved. There is very little reason for them not to order more tests and treatments. By training and inclination, doctors want to do all they can to cure ailments. And since Medicare pays by procedure, test, and hospital stay—though less and less each year as the cost squeeze tightens—there is an incentive to do more and more. To make a good living, doctors must see more patients, and order more tests.

All this treatment does not necessarily buy better care. In fact, the Dartmouth studies have found worse outcomes in many states and cities where there is more health care. Why? Because just going into the hospital has risks—of infection, or error, or other unforeseen complications. Some studies estimate that Americans are overtreated by roughly 30 percent. “It’s not about rationing care—that’s always the bogeyman people use to block reform,” says Dr. Elliott Fisher, a professor at Dartmouth Medical School. “The real problem is unnecessary and unwanted care.”

But how do you decide which treatments to cut out? How do you choose between the necessary and the unnecessary? There has been talk among experts and lawmakers of giving more power to a panel of government experts to decide—Britain has one, called the National Institute for Health and Clinical Excellence (known by the somewhat ironic acronym NICE). But no one wants the horror stories of denied care and long waits that are said to plague state-run national health-care systems. (The criticism is unfair: patients wait longer to see primary-care physicians in the United States than in Britain.) After the summer of angry town halls, no politician is going to get anywhere near something that could be called a “death panel.”

There’s no question that reining in the lawyers would help cut costs. Fearing medical-malpractice suits, doctors engage in defensive medicine, ordering procedures that may not be strictly necessary—but why take the risk? According to various studies, defensive medicine adds perhaps 2 percent to the overall bill—a not-insignificant number when more than $2 trillion is at stake. A number of states have managed to institute some kind of so-called tort reform, limiting the size of damage awards by juries in medical-malpractice cases. But the trial lawyers—big donors to the Democratic Party—have stopped Congress from even considering reforms. That’s why it was significant that President Obama even raised the subject in his speech last week, even if he was vague about just what he’d do. (Best idea: create medical courts run by experts to rule on malpractice claims, with no punitive damages.)

But the biggest cost booster is the way doctors are paid under most insurance systems, including Medicare. It’s called fee-for-service, and it means just that. So why not just put doctors on salary? Some medical groups that do, like the Mayo Clinic, have reduced costs while producing better results. Unfortunately, putting doctors on salary requires that they work for someone, and most American physicians are self-employed or work in small group practices. The alternative—paying them a flat rate for each patient they care for—turned out to be at least a partial bust. HMOs that paid doctors a flat fee in the 1990s faced a backlash as patients bridled at long waits and denied service.

Ever-rising health-care spending now consumes about 17 percent of the economy (versus about 10 percent in Europe). At the current rate of increase, it will devour a fifth of GDP by 2018. We cannot afford to sustain a productive economy with so much money going to health care. Over time, economic reality may force us to adopt a national health-care system like Britain’s or Canada’s. But before that day arrives, there are steps we can take to reduce costs without totally turning the system inside out.

One place to start is to consider the psychological aspect of health care. Most people are at least minor hypochondriacs (I know I am). They use doctors to make themselves feel better, even if the doctor is not doing much to physically heal what ails them. (In ancient times, doctors often made people sicker with quack cures like bleeding.) The desire to see a physician is often pronounced in assisted-living facilities. Old people, far from their families in our mobile, atomized society, depend on their doctors for care and reassurance. I noticed that in my mother’s retirement home, the talk in the dining room was often about illness; people built their day around doctor’s visits, partly, it seemed to me, to combat loneliness.

Physicians at Massachusetts General Hospital are experimenting with innovative approaches to care for their most ill patients without necessarily sending them to the doctor. Three years ago, Massachusetts enacted universal care—just as Congress and the Obama administration are attempting to do now. The state quickly found it could not afford to meet everyone’s health-care demands, so it’s scrambling for solutions. The Mass General program assigned nurses to the hospital’s 2,600 sickest—and costliest—Medicare patients. These nurses provide basic care, making sure the patients take their medications and so forth, and act as gatekeepers—they decide if a visit to the doctor is really necessary. It’s not a perfect system—people will still demand to see their doctors when it’s unnecessary—but the Mass General program cut costs by 5 percent while providing the elderly what they want and need most: caring human contact.

Other initiatives ensure that the elderly get counseling about end-of-life issues. Although demagogued as a “death panel,” a program in Wisconsin to get patients to talk to their doctors about how they want to deal with death was actually a resounding success. A study by the Archives of Internal Medicine shows that such conversations between doctors and patients can decrease costs by about 35 percent—while improving the quality of life at the end. Patients should be encouraged to draft living wills to make their end-of-life desires known. Unfortunately, such paper can be useless if there is a family member at the bedside demanding heroic measures. “A lot of the time guilt is playing a role,” says Dr. David Torchiana, a surgeon and CEO of the Massachusetts General Physicians Organization. Doctors can feel guilty, too—about overtreating patients. Torchiana recalls his unease over operating to treat a severe heart infection in a woman with two forms of metastatic cancer who was already comatose. The family insisted.

Studies show that about 70 percent of people want to die at home—but that about half die in hospitals. There has been an important increase in hospice or palliative care—keeping patients with incurable diseases as comfortable as possible while they live out the remainder of their lives. Hospice services are generally intended for the terminally ill in the last six months of life, but as a practical matter, many people receive hospice care for only a few weeks.

Our medical system does everything it can to encourage hope. And American health care has been near miraculous—the envy of the world—in its capacity to develop new lifesaving and life-enhancing treatments. But death can be delayed only so long, and sometimes the wait is grim and degrading. The hospice ideal recognized that for many people, quiet and dignity—and loving care and good painkillers—are really what’s called for.

That’s what my mother wanted. After convincing the doctors that she meant it—that she really was ready to die—she was transferred from the ICU to a hospice, where, five days later, she passed away. In the ICU, as they removed all the monitors and pulled out all the tubes and wires, she made a fluttery motion with her hands. She seemed to be signaling goodbye to all that—I’m free to go in peace.

With Pat Wingert, Suzanne Smalley, and Claudia Kalb in Washington

WASHINGTON — The new plan that President Obama laid out for a missile shield against Iran on Thursday turns Ronald Reagan’s vision of a Star Wars system on its head: Rather than focusing first on protecting the continental United States, it shifts the immediate effort to defending Europe and the Middle East.

It is a long way from the impermeable shield that President Reagan described in glowing terms in 1983, an announcement that turned into a diplomatic triumph even while it was a technological flop. Ever since, missile defense has always been more about international politics than about new military technology.

In the last years of the cold war, it helped nudge the Soviets toward agreements that sharply reduced nuclear arsenals, a process that Mr. Obama hopes to revive at the end of the year. In the George W. Bush years, it was about expanding NATO and, under the cover of building antimissile bases to protect against North Korean attack, a subtle warning to China that its power in the Pacific would not go unchecked.

Now, in the age of Obama, the vision has descended from the stars to sea level. A president who was still in college during Reagan’s famous missile defense speech has turned a scaled-back version of the technology, which would first be based on ships, to a new mission: Convincing Israel and the Arab world that Washington is moving quickly to counter Iran’s influence, even as it opens direct negotiations with Tehran for the first time in 30 years.

For Mr. Obama, it is a step fraught with some risk. Within hours of his announcement, charges were flying that in his first major confrontation with the Russians, he had backed down, giving in to Moscow’s opposition to the Bush plan to place missile defenses in Poland and the Czech Republic.

“The politics of this was driving him in the other direction, against appearing to back down,” said William Perry, who served as defense secretary in the Clinton administration. “But he went with where the technology is today — and where the threat is today.”

During last year’s presidential campaign, missile defense was tricky territory for Mr. Obama. His liberal base was allergic to the very words. Mr. Obama, eager to show that he was neither a neophyte nor soft on defense, talked about embracing those technologies that were “proven and cost-effective.”

Nine months into his presidency, Mr. Obama has begun to describe what that means. He is not abandoning the two antimissile bases built on American soil in the Bush years, one in Alaska and one in California. But his aides — led by the one veteran of the cold war in his cabinet, Defense Secretary Robert M. Gates — argued Thursday that Iran and North Korea were taking far longer to develop intercontinental missiles than many feared a decade ago.

The urgency, they argued, lies in addressing a more imminent threat: Iran’s short- and medium-range missiles.

First among those weapons is the Shahab III, the missile that can reach Israel and parts of Europe. It is also the missile that American, Israeli and European intelligence services have charged that Iran hopes to fit with a nuclear warhead. Iran denies that but has refused to answer questions from international inspectors about documents that appear to link the missile program to its nuclear efforts.

That standoff has fed the conviction inside the White House that the Iranian threat needs to be countered. But officials argued Thursday that the faster, and surer, way to accomplish that goal was to scrap Mr. Bush’s plan, which would have based antimissile batteries too far from Iran to be useful against short- and medium-range missiles, and put them closer to Tehran.

“One of the realities of life is the enemy gets a vote,” said Gen. James E. Cartwright, vice chairman of the Joint Chiefs of Staff.

But Mr. Obama’s critics argue that while Iran is rightly a major focus of missile defense, it is not the only one, and that in dismantling the Bush plan, the new president is undercutting American allies.

“I fear the administration’s decision will do just that,” Senator John McCain, Mr. Obama’s Republican rival in last year’s presidential election, said Thursday, adding that the decision came “at a time when Eastern European nations are increasingly wary of renewed Russian adventurism.”

But Mr. Obama is betting that over time he can assuage bruised feelings in Europe. And he is betting that his credibility will rise in the Middle East, where he can now argue that the American missile shield will defend both Israel and the Arab states, notably Saudi Arabia and Egypt. There are signs that all of them may be interested in nuclear capabilities of their own — especially if they believe that the United States will not stand up to Iran.

But Mr. Obama may also be vulnerable to charges that he could be leaving parts of the continental United States defenseless if Iran makes bigger strides with long-range missiles. His critics point to Iran’s launching of a satellite into space in February. The craft orbited the Earth for nearly three months, passing repeatedly over the United States.

“Iran has already demonstrated it has the capability to develop long-range missiles,” said Robert Joseph, one of the architects of Mr. Bush’s missile defense strategy, who was highly critical of Mr. Obama’s decision. “They have both the capability and intention to move forward.”

The Obama administration counters that Iran has no long-range rockets and that the threat has been slower to develop than expected.

Twenty-six years after Mr. Reagan’s famous speech, the most visible element of his strategy is a system of missile interceptors that sprawl across the wilds of Alaska and a sister base in California. The system’s “kill vehicles” are meant to zoom into space and destroy enemy warheads — presumably a single North Korean launching — by force of impact. Military and private experts say the West Coast interceptors could also smash an Iranian warhead, unless it was headed toward the East Coast of the United States. That is why the Bush administration wanted to erect additional interceptors in Poland. To advocates of the classic vision of missile defense, it is unconscionable to leave the East Coast unprotected.

But critics of the interceptor system say its flight tests have repeatedly fallen short, and call its supposed protection a mirage.

Now comes the next debate: Whether the Obama plan is any more technologically feasible than past efforts.

So Mr. Obama faces the same challenge as Mr. Reagan: Winning the argument that his version of missile defense is workable — or at least workable enough to be a potent political weapon.

For years, death-penalty opponents and supporters have been working their way toward a moment in which each side would rethink things. They were seeking a case in which a clearly innocent defendant was wrongly put to death. In a 2005 Supreme Court case that actually had nothing to do with the execution of innocents, Justices David Souter and Antonin Scalia tangled over the possibility that such a creature even existed. Souter fretted that “the period starting in 1989 has seen repeated exonerations of convicts under death sentences, in numbers never imagined before the development of DNA tests.” To which Scalia retorted: “The dissent makes much of the newfound capacity of DNA testing to establish innocence. But in every case of an executed defendant of which I am aware, that technology has confirmed guilt.” Scalia went on to blast “sanctimonious” death-penalty opponents and a 1987 study on innocent exonerations whose “obsolescence began at the moment of publication,” then concluded that there was not “a single case—not one—in which it is clear that a person was executed for a crime he did not commit.”

This suggested that if anyone found such a case, the Scalias of the world would rethink matters. As of today, the Innocence Project, a national organization dedicated to exonerating the wrongfully convicted through DNA testing, claims there have been 241 postconviction DNA exonerations, of which 17 were former death-row inmates spared execution. The gap between their facts and Scalia’s widens every year. And now we may have found that case of an innocent put to death: Cameron Todd Willingham, executed by the state of Texas in 2004 for allegedly setting a 1991 house fire that killed his three young daughters.

David Grann, who wrote a remarkable piece about the case in last week’s New Yorker, sifted through the evidence against Willingham to reveal that the entire prosecution was a train wreck. And at every step in his appeal, Willingham’s claims of innocence were met with the response that he’d already had more than enough due process for a baby killer.

But you needn’t take Grann’s word for it. In 2004 Gerald Hurst, an acclaimed scientist and fire investigator, conducted an independent investigation of the evidence in the Willingham case and came away with little doubt that it was an accidental fire—likely caused by a space heater or bad wiring. Hurst found no evidence of arson, and wrote a report to try to stay the execution. According to documents obtained by the Innocence Project, it appears nobody at the state Board of Pardons and Paroles or the Texas governor’s office even took note of Hurst’s conclusions. Just before Willingham was executed, he told the Associated Press, “[T]he most distressing thing is the state of Texas will kill an innocent man and doesn’t care they’re making a mistake.”

Since Willingham’s death, two other independent inquiries found no evidence of arson. In 2007 the state of Texas commissioned another renowned arson expert, Craig Beyler, to examine the Willingham evidence. Beyler’s report, issued two weeks ago, concluded that investigators had no scientific basis for claiming the fire was arson.

One might think that all this would give a boost to death-penalty opponents, who have long contended that conclusive proof of an innocent murdered by the state would fundamentally change the debate. But that was before the goalposts began to shift this summer. In June, by a 5–4 margin, the Supreme Court ruled that a prisoner did not have a constitutional right to demand DNA testing of evidence in police files, even at his own expense. “A criminal defendant proved guilty after a fair trial does not have the same liberty interests as a free man,” wrote Chief Justice John Roberts. And two months later, Justices Scalia and Clarence Thomas went even further when the Supreme Court ordered a new hearing in Troy Davis’s murder case, after seven of nine eyewitnesses recanted their testimony. Justice Scalia, dissenting from that order, wrote for himself and Thomas, “[T]his court has never held that the Constitution forbids the execution of a convicted defendant who has had a full and fair trial but is later able to convince a habeas court that he is ‘actually’ innocent.”

As a constitutional matter, Scalia’s assertion is not wrong. The court has never found a constitutional right for the actually innocent to be free from execution. When the court flirted with the question in 1993, a majority ruled against the accused, but Chief Justice William Rehnquist left open the possibility that it may be unconstitutional to execute someone with a “truly persuasive demonstration” of innocence. Now, in Scalia’s America, the Cameron Todd Willingham whose very existence was once in doubt is legally irrelevant. We may execute a man for an accidental house fire, while the Constitution itself stands silently by.

Lithwick also writes for slate.com.

Dr. Robert Golden is a urologist in Spokane.

Government program endorsed, not required

WASHINGTON – President Barack Obama on Wednesday laid out a series of compromises he’s willing to make to get a health care overhaul through a nervous Congress this year, including diluting his vision for a new public insurance program and embracing ideas floated by Republicans.

In an address to a joint session of Congress, Obama tried to seize control of the Democratic Party’s highest domestic priority after months of party disarray and raucous public debate across the country. The president said that he’d require all individuals to have health insurance and would provide tax credits to people and small businesses that couldn’t afford it.

“Well, the time for bickering is over. The time for games has passed. Now is the season for action,” Obama said.

At one point, a South Carolina Republican congressman shouted, “You lie” when Obama characterized reports that he’d insure illegal immigrants as false.

On perhaps the most controversial single plank in his program, Obama endorsed creating a “public option” government program to compete against private insurers, but he didn’t insist that it be included.

Instead, he left room for alternatives that liberal Democrats in Congress are resisting. Those include creating nonprofit health care cooperatives; a “trigger” mechanism for a public option to kick in later if private insurers fail to meet benchmarks of coverage; or perhaps simply tightening regulations on private insurers.

He pledged that any “public option” wouldn’t weaken coverage for those in Medicare or insured through their employers. He promised them “more security and stability.”

In turn, Obama made it clear that he intends to work with congressional Democrats to push some health care plan through Congress this year – on a bare partisan majority if necessary.

“I am not the first president to take up this cause, but I am determined to be the last,” Obama said in remarks that he hoped would breathe new life into Democrats’ push to expand coverage to many of the roughly 46 million in the U.S. who now lack health insurance.

“We are the only advanced democracy on Earth, the only nation, that allows such hardships for millions of people,” he said. “Now is the season for action.”

Such an expansion is a goal that’s eluded presidents since Harry Truman, and, most recently, Bill Clinton 15 years ago.

Obama said that his plan would cost about $900 billion over a decade. He said it could be paid for mostly by eliminating “waste and abuse” from the existing health care system, but he wasn’t specific. In addition, he’d charge insurance companies “a fee for their most expensive policies” to fund his plan. Beyond that, he failed to specify how his proposals would slow rising health costs.

Three House of Representatives committees have written legislation that would create a public option, raise taxes on the wealthy to help pay for the plan and mandate coverage for most people. The House is expected to combine three pending Democratic bills into one piece of legislation and attempt to pass it this month.

The Senate outlook is cloudier and likely to take longer. Even if both chambers pass versions of the legislation, they’re all but certain to differ, requiring a House-Senate conference to draft a compromise version that each house then must pass. How that will happen or what final terms it may contain aren’t clear.

Fleshing out a framework that he’s been advocating for months now, Obama called for creating a government health insurance exchange, or marketplace, to take effect by 2013. Through it many Americans could obtain lower-cost private coverage – or possibly coverage through some variation of a public plan if Congress creates one.

Until the exchange would take effect, Obama would borrow from a plan that his 2008 Republican rival, Arizona Sen. John McCain, proposed last year – to provide catastrophic coverage for those with pre-existing conditions.

In another olive branch to Republicans, Obama indicated that he’d support some “demonstration projects” to try setting experimental limits on medical malpractice lawsuits – long a Republican goal that Democrats typically oppose.

Obama also called for new regulations on private insurers to protect patients. He told Americans that any plan he signs will:

•Ban insurance companies from denying coverage because of pre-existing conditions.

•Prevent insurers from dropping or watering down coverage during illness.

•End arbitrary annual or lifetime coverage caps.

•Limit out-of-pocket expenses.

•Require insurers to cover routine checkups, mammograms and colonoscopies.

Cal Thomas is a columnist for Tribune Media Services.

Insurance companies would face benchmarks

Charles Krauthammer

Charles Krauthammer is a columnist for the Washington Post Writers Group. His e-mail address is letters@charleskrauthammer.com.

AUSTIN, Tex. — Even as evidence mounts that the Great Recession has finally released its chokehold on the American economy, experts worry that the recovery may be weak, stymied by consumers’ reluctance to spend.

Given that consumer spending has in recent years accounted for 70 percent of the nation’s economic activity, a marginal shrinking could significantly depress demand for goods and services, discouraging businesses from hiring more workers.

Millions of Americans spent years tapping credit cards, stock portfolios and once-rising home values to spend in excess of their incomes and now lack the wherewithal to carry on. Those who still have the means feel pressure to conserve, fearful about layoffs, the stock market and real estate prices.

“We’re at an inflection point with respect to the American consumer,” said Mark Zandi, chief economist at Moody’s Economy .com, who correctly forecast a dip in spending heading into the recession, and who provided data supporting sustained weakness.

“Lower-income households can’t borrow, and higher-income households no longer feel wealthy,” Mr. Zandi added. “There’s still a lot of debt out there. It throws a pall over the potential for a strong recovery. The economy is going to struggle.”

In recent weeks, spending has risen slightly because of exuberant car buying, fueled by the cash-for-clunkers program. On Friday, the Commerce Department said spending rose 0.2 percent in July from the previous month. But most economists see this activity as short-lived, pointing out that incomes did not rise. Some suggest the recession has endured so long and spread pain so broadly that it has seeped into the culture, downgrading expectations, clouding assumptions about the future and eroding the impulse to buy.

The Great Depression imbued American life with an enduring spirit of thrift. The current recession has perhaps proven wrenching enough to alter consumer tastes, putting value in vogue.

“It’s simply less fun pulling up to the stoplight in a Hummer than it used to be,” said Robert Barbera, chief economist at the research and trading firm ITG. “It’s a change in norms.”

Here in Austin, a laid-back city on the banks of the Colorado River, change is palpable.

A decade ago, Heather Nelson gained a lucrative job in telecommunications and celebrated by buying a new Ford sport utility vehicle with leather seats and an expensive stereo system. Today, Ms. Nelson, 38, again has designs on a new vehicle, but this time she plans to buy a Toyota Prius, the fuel-efficient hybrid.

In December, Ms. Nelson was laid off from her six-figure job as a patent attorney at a local software firm. Self-assured, she exudes confidence she will land another high-paying position.

But even if her spending power is restored, Ms. Nelson says her inclination to buy has been permanently diminished. Through nine months of joblessness, she has learned to forgo the impulse buys that used to provide momentary pleasure — $4 lattes at Starbucks, lip gloss, mints. She has found she can survive without the pedicures and chocolate martinis that once filled regular evenings at the spa. Before punishing heat and drought turned much of central Texas brown, she subsisted primarily on vegetables harvested from her plot at a community garden, where only one oasis of flowers remains.

Once intent on buying a home, Ms. Nelson now feels security in remaining a renter, steering clear of the shark-infested waters of the mortgage industry.

“I’m having to shift my dreams to accommodate the new realities,” she said. “Now, I have more of a bunker mentality. If you get hit hard enough, it lasts. This impact is going to last.”

For years, Americans have tapped stock portfolios and borrowed against homes to fill wardrobes with clothes, garages with cars and living rooms with furniture and electronics. But stock markets have proven volatile. Home values are sharply lower. Banks remain reluctant to lend in the aftermath of a global financial crisis.

Households must increasingly depend upon paychecks to finance spending, a reality that seems likely to curb consumption: Unemployment stands at 9.4 percent and is expected to climb higher. Working hours have been slashed even for those with jobs.

Economists subscribe to a so-called wealth effect: as households amass wealth, they tend to expand their spending over the following year, typically by 3 to 5 percent of the increase.

Between 2003 and 2007 — prime years of the housing boom — the net worth of an American household expanded to about $540,000, from about $400,000, according to an analysis of federal data by Moody’s Economy.com.

Now, the wealth effect is working in reverse: by the first three months of this year, household net worth had dropped to $421,000.

“Not only have people lost money, but they don’t expect as much appreciation in the money they have, and that should affect consumption,” said Andrew Tilton, an economist at Goldman Sachs. “This is a cultural shift going on. People will save more.”

As recently as the middle of 2007, Americans saved less than 2 percent of their income, according to the Bureau of Economic Analysis. In recent months, the rate has exceeded 4 percent.

Austin has fared better than most cities during the recession. Increased government payrolls enabled by the state’s energy wealth have largely compensated for layoffs in construction and technology. Local unemployment reached 7.1 percent in June — well below the national average. Housing prices have mostly held. Yet even people with high incomes appear reluctant to spend.

“The only time you do a lot of business is when you throw a sale,” said Pat Bennett, a salesman at a Macy’s in north Austin. “You see very little impulse buying. They come in saying, ‘I need a pair of underwear,’ and they get it and leave. You don’t really see them saying, ‘Oh, I love the way that shirt looks, and I’m just going to get it.’ ”

Mr. Bennett attributes frugality to a general uneasiness about the future.

“Our parents had the Depression,” Mr. Bennett said. “This is like a mini-shock for the baby boomers after the go-go years.”

At a mall devoted to home furnishings, many storefronts were vacant, and survivors were draped in the banners of desperation: “Inventory Clearance,” “50% Off,” “It’s All On Sale.”

But at the Natural Gardener — a lush assemblage of demonstration plots that sells seeds, plants and tools for organic gardening — business has never been better.

Sales of vegetable plants swelled fivefold in March over past years. The company added a public address system and bleachers to accommodate hordes showing up for vegetable-growing classes.

Part of the embrace of gardening stems from concerns about the environment and food safety, says the company’s president, John Dromgoole. Momentum also reflects desire to save on food costs.

“People are very interested in shoring up against losing their jobs,” he said.

Abdullah alleges ‘widespread rigging’ in election

Fed boss says U.S. economy should start growing again soon

Bernanke

JACKSON, Wyo. – Federal Reserve Chairman Ben Bernanke on Friday offered his most optimistic outlook since the financial crisis struck, saying the economy is on the verge of growing again.

Speaking at an annual Fed conference, Bernanke acknowledged no missteps by the central bank in managing the worst crisis since the Great Depression. But he conceded that consumers and businesses are still having trouble getting loans, even though the financial system is gradually stabilizing.

Economic activity in both the U.S. and around the world seems to be leveling out, and the economy is likely to start growing again soon, Bernanke said.

Bernanke’s hopeful remarks on the economy contributed to a rally on Wall Street. The Dow Jones industrial average surged about 155 points, or 1.7 percent, and broader stock averages also gained sharply.

Despite his upbeat tone, Bernanke cautioned that the recovery is likely to be “relatively slow at first.”

Unemployment, now at 9.4 percent, is widely expected to hit double digits later this year and to remain high for many months.

The financial markets have stabilized, and some businesses and consumers have found it easier to get loans. Still, the banking system has yet to return to normal, Bernanke said.

Financial institutions face further losses on soured investments. And many businesses and households still can’t get the credit they need to fuel the economy, he said.

“Although we have avoided the worst, difficult challenges still lie ahead,” Bernanke told the gathering of fellow bankers, academics and economists. “We must work together to build on the gains already made to secure a sustained economic recovery.”

Reviewing the past year’s crisis, Bernanke outlined the many emergency measures the Fed and other regulators took to help ward off a global financial meltdown. He declined to acknowledge critics’ arguments that regulators failed to detect signs of the crisis before it occurred – or that Wall Street bailouts sent a message that big companies that make reckless bets would be rescued with taxpayer money.

A $700 billion taxpayer-funded bailout program to prop up financial institutions incensed many Americans. So did the repeated bailouts of AIG, which paid hefty bonuses to employees who worked in the division that brought down the firm.

Some analysts said Bernanke appeared to be angling to keep his job for another term.

“The lack of any mea culpa suggests the Fed chairman wants to be reappointed,” said Richard Yamarone, economist at Argus Research. “When you go on an interview, you never speak of your shortcomings.”

President Barack Obama will have to decide in coming months whether to reappoint or replace Bernanke, whose term expires early next year.

The bulk of Bernanke’s speech chronicled the extraordinary events of the past year.

Financial markets took a dizzying plunge starting in September and into October, nearly shutting down the flow of credit. The crisis felled storied Wall Street firms. The government took over mortgage giants Fannie Mae and Freddie Mac, as well as insurance titan American International Group Inc.

Lehman Brothers failed. It filed for bankruptcy on Sept. 15, the largest in corporate history, roiling markets worldwide.

The Fed swooped in with unprecedented emergency lending programs to fight the crisis. It eventually slashed a key bank lending rate to a record low near zero. And Congress enacted programs to stimulate the economy, including a $787 billion package of tax cuts and increased government spending.

“Without these speedy and forceful actions, last October’s panic would likely have continued to intensify, more major firms would have failed and the entire global financial system would have been at serious risk,” Bernanke said.

Unlike in the 1930s, Washington policymakers this time acted aggressively and quickly to contain the crisis, said Bernanke, a scholar of the Great Depression.

“As severe as the economic impact has been, however, the outcome could have been decidedly worse,” he said.

Global cooperation in battling the crisis was crucial, with central banks slashing interest rates and the U.S. and other governments delivering fiscal stimulus, he said.

WASHINGTON — House and Senate leaders on Wednesday struck a deal on a $789 billion economic stimulus bill after little more than 24 hours of rapid-fire negotiations with the Obama administration, clearing the way for final Congressional action later this week.

The package of spending increases and tax relief, intended to spur an economic recovery and create jobs by putting money back in the pockets of consumers and companies, ended up smaller than either the House or Senate had proposed.

Many Democrats would have preferred a larger bill, but agreed to pare back, including cuts to favored education and health programs, to win three crucial Republican votes in the Senate.

“Legislation is the art of compromise, consensus building, and that’s what we did,” the Senate majority leader, Harry Reid of Nevada, said in announcing the accord.

The House was poised for a final vote as early as Friday, with the Senate to follow, clearing the way for President Obama to sign the bill by Monday. The White House is considering a prime-time bill signing ceremony, and on Wednesday asked the television networks if they would air the event.

In a statement, the president thanked Congress for agreeing to a measure that he said would save or create 3.6 million jobs.

“I’m grateful,” Mr. Obama said, “for moving it along with the urgency that this moment demands.”

The deal reflected a calculated gamble by Mr. Obama in the first weeks of his term. To win Republican votes, the final stimulus package is considerably leaner than what many economists say is now needed to jolt the economy, given its grave condition.

But it is unclear if Mr. Obama will be able to claim credit for bringing change to Washington by winning bipartisan support for his first major piece of legislation. Not a single House Republican voted for the bill when it came to the floor two weeks ago, and despite many compromises in the Senate, only three Republicans came on board.

The final bill includes $507 billion in spending programs and $282 billion in tax relief, including a scaled-back version of Mr. Obama’s middle-class tax cut proposal, which would give credits of up to $400 for individuals and $800 for families within certain income limits. It will also provide a one-time payment of $250 to recipients of Social Security and government disability support.

House Democrats, angry over some cuts, particularly for school construction, initially balked at the deal and delayed a final meeting on Wednesday between House and Senate negotiators.

Democratic officials said Speaker Nancy Pelosi felt that Mr. Reid went too far by announcing a deal before it was vetted by her office and discussed by House members in an emergency caucus meeting, setting off the last-minute flare-up.

Ms. Pelosi said at a news conference that the delay helped House Democrats win some final concessions, including an agreement to let states use some money in a fiscal stabilization fund for school renovations. “There is no question that one of our overriding priorities in the House was a very strong commitment to school construction,” she said. “That’s still in the bill.”

But they soon relented and the meeting got under way in a packed Lyndon B. Johnson Room on the Senate side of the Capitol.

Despite the show of pique, for Democrats the stimulus bill is the most prominent display yet that they now fully control Washington. Their ability to push the package forward represented a turnabout from years of losing battles under President George W. Bush. For Republicans, it underscored the limits of their diminished ranks.

Even trimmed to $789 billion, the recovery measure will be the most expansive unleashing of the government’s fiscal firepower in the face of a recession since World War II.

And yet it seemed almost trifling compared with the $2.5 trillion rescue plan for the financial system — a combination of loans to banks and incentives to bring private capital into the banking system — announced on Tuesday by Treasury Secretary Timothy F. Geithner.

Although the final legislative language was not immediately available, lawmakers said the bill contained more than $150 billion in public works projects for transportation, energy and technology, and $87 billion to help states meet rising Medicaid costs.

Despite intense lobbying by governors around the country, the final deal slashed $25 billion from a proposed state fiscal stabilization fund, eliminated a $16 billion line item for school construction and sharply curtailed spending to provide health insurance for the unemployed.

In driving down the total cost — from $838 billion for the Senate stimulus bill and $820 billion for the House-passed measure — lawmakers also reduced the Senate’s proposed tax incentives for buyers of homes and cars, which hold big public appeal.

The final agreement retained a $70 billion tax break to spare millions of middle-income Americans from paying the alternative minimum tax in 2009. Some Democrats decried the provision as a costly addition that would not lift the economy and that Congress would have approved, regardless of the recession.

After huddling in Ms. Pelosi’s office on Tuesday until nearly midnight, top White House officials and Congressional leaders had all but ironed out the differences between the House and Senate versions of the stimulus by noon on Wednesday.

Even before the last touches were put to the bill, some angry Democrats said that Mr. Obama and Congressional leaders had been too quick to give up on Democratic priorities. “I am not happy with it,” said Senator Tom Harkin, Democrat of Iowa. “You are not looking at a happy camper. I mean they took a lot of stuff out of education. They took it out of health, school construction and they put it more into tax issues.”

Mr. Harkin said he was particularly frustrated by the money being spent on fixing the alternative minimum tax. “It’s about 9 percent of the whole bill,” he said, “Why is it in there? It has nothing to do with stimulus. It has nothing to do with recovery.”

But even as Congressional leaders and top White House officials went through the package with a carving knife, it was clear that the three Republicans who agreed to support the bill in the Senate wielded extraordinary power, and along with conservative Democrats, had put a firm stamp on the stimulus package.

For instance, negotiators opted to keep many of the Senate’s reduced spending provisions, but they were careful to maintain an additional $6.5 billion for medical research that was inserted at the insistence of Senator Arlen Specter, Republican of Pennsylvania, who is a cancer survivor. He was one of the three Republican supporters of the recovery package.

“I think it is an important component of putting America back on its feet,” Mr. Specter said, though he added that it was still a difficult vote “in view of the large deficit and national debt.”

The Senate bill came together only after a bipartisan group of centrist senators, led by Susan Collins, Republican of Maine, and Ben Nelson, Democrat of Nebraska, reached a deal to trim the cost of the package to $838 billion from more than $920 billion.

“These aren’t easy times, obviously for America,” said Senator Olympia J. Snowe, Republican of Maine, who was also a member of that group. “Given the gravity of the circumstances economically, I thought it was important to be part of a process that could yield a consensus-based solution.”

But the majority of Republicans continued to criticize the stimulus measure on Wednesday as a bloated and ill-designed spending bonanza by Democrats on favored projects that would not help lift the economy out of recession but would permanently expand the federal government and plunge future generations of Americans deep into debt.

“Yesterday the Senate cast one of the most expensive votes in history,” said the Republican leader, Senator Mitch McConnell of Kentucky. “Americans are wondering how we’re going to pay for all this.”

Indeed, the formal House-Senate conference meeting, usually an elaborate parliamentary ritual with reams of legislative paperwork strewn across cluttered conference tables, instead served mostly as a live, televised forum for some of the most powerful Democrats and Republicans in Congress to trade barbs.

Senator Charles E. Grassley, Republican of Iowa, complained that despite Mr. Obama’s call for bipartisan cooperation, Republicans had largely been shut out. “We didn’t have a chance to negotiate,” Mr. Grassley said.

Robert Pear, Kate Phillips and Jeff Zeleny contributed reporting.

Unclear which party will get first chance to form government

Israel’s foreign minister and Kadima Party leader Tzipi Livni reacts during an election night rally in Tel Aviv on Tuesday.

No clear winner

Israel voters cast their ballots for the 120-seat parliament Tuesday. Nearly complete results show the leading parties will be:

Kadima: 28 seats

Likud: 27 seats

Yisrael Beitenu: 16 seats

Labor: 13 seats

JERUSALEM – Israeli voters on Tuesday delivered a split decision in national elections, sparking competing claims by backers of opposition leader Benjamin Netanyahu and Foreign Minister Tzipi Livni over who will be the next prime minister.

Voters appeared to give Livni’s Kadima Party, which favors negotiations with the Palestinians, a slight and unexpected edge over Netanyahu’s Likud, which has been critical of peace talks, according to nearly complete returns and exit polls.

But the overall shift in Israel’s parliament, the Knesset, was sharply to the right. That could make it difficult for Livni to build the coalition she would need to govern, particularly if she intends to pursue U.S.-backed talks aimed at creating a Palestinian state.

Both candidates claimed victory, and the political jockeying was expected to intensify in the coming days. It will fall to President Shimon Peres to decide who gets first crack at forming a government – a tricky task in Israel’s fractious political culture. Traditionally, the president chooses the party that receives the most seats in the 120-member Israeli parliament, but he is not obligated to do so. Peres will now consult with all the parties to determine who has the best chance of creating a stable government.

The question of who will lead Israel could linger for weeks or more at a time when the nation faces threats from Hamas in Gaza, Hezbollah in Lebanon and an Iranian government with nuclear ambitions.

Netanyahu, prime minister during the late 1990s, delivered a victory speech just after midnight in which he told cheering supporters in Tel Aviv that “the people of Israel have spoken clearly and sharply. The national camp, headed by the Likud, has won a clear victory.”

Netanyahu signaled he intended to lead a coalition of parties that, like his own, take a hawkish stance toward Iran and believe that the creation of a Palestinian state would present a threat to Israeli security.

Livni, who would be Israel’s first female prime minister since Golda Meir led the country more than three decades ago, served as lead negotiator during last year’s unsuccessful negotiations with the Palestinians. Livni has favored continued efforts toward reaching a deal.

“Today the nation chose Kadima,” an energetic Livni declared to a crowd of backers, who serenaded her with chants of “the next prime minister.”

Livni said she would attempt to form a national unity government that includes parties across the political spectrum.

With votes from more than 90 percent of polling stations counted, Kadima had won an estimated 28 seats in the 120-member Israeli parliament. Netanyahu’s Likud garnered 27. Ultra-nationalist leader Avigdor Lieberman was projected to place third, with 16 seats. Defense Minister Ehud Barak, head of the center-left Labor Party that once dominated Israeli politics, was forecast to drop to fourth at 13 seats.

WASHINGTON — The White House plan to rescue the nation’s financial system, announced on Tuesday by Timothy F. Geithner, the Treasury secretary, is far bigger than anyone predicted and envisions a far greater government role in markets and banks than at any time since the 1930s.

Administration officials committed to flood the financial system with as much as $2.5 trillion — $350 billion of that coming from the bailout fund and the rest from private investors and the Federal Reserve, making use of its ability to print money.

Mindful of previous financial crises at home and abroad that became protracted because governments moved too slowly, Mr. Geithner pointedly criticized the Bush administration for not acting boldly and quickly enough.

But the initial assessment of the plan from the markets, lawmakers and economists was brutally negative, in large part because they expected more details.

Basic questions about how the various parts of the program would work, especially those involving the unsellable mortgages that banks are holding and preventing home foreclosures, were left for another day. Some Wall Street experts criticized the plan for relying too heavily on the same vague solutions proposed by the Bush administration.

The stock market, propped up for weeks on the expectation that Washington would finally deliver a comprehensive rescue plan, dipped almost as soon as Mr. Geithner began speaking in the morning. The Dow Jones industrial average fell 382 points, or 4.6 percent, by the time the market closed. Yields on Treasury bills dropped, indicating a flight from stocks to the safety of government bonds. Asian markets slipped more narrowly.

While traveling in Fort Myers, Fla., President Obama welcomed the news that the Senate voted 61-37 to approve its $838 billion economic stimulus bill Tuesday, but dismissed the market reaction to his bank rescue plan.

“Wall Street, I think, is hoping for an easy out on this thing and there is no easy out,” Mr. Obama said in an interview with ABC News.

Many of the vital details of the program remain unsettled and are the subject of an intense behind-the-scenes debate.

The president himself had built up expectations that the plan would get ahead of the crisis — and not lurch from pillar to post as the Bush administration did last year, often in partnership with the New York Federal Reserve under its then-president, Mr. Geithner.

A central piece of the plan — and the one item that investors most craved information about — would create one or more so-called bad banks that would rely on taxpayer and private money to purchase and hold banks’ bad assets. But the administration provided the least amount of details about this part of the plan.

Another centerpiece of the plan would stretch the last $350 billion that the Treasury has for the bailout by relying on the Federal Reserve’s ability to create money, in effect, out of thin air. The Fed’s money will enable the government to become involved in the management of markets and banks in ways not seen since the Great Depression.

In the credit markets, for instance, the administration and the Fed are proposing to expand a lending program that would spend as much as $1 trillion to make up for the $1.2 trillion decline between 2006 and last year in the issuance of securities backed primarily by consumer loans.

The plan’s third major component would give banks new helpings of capital with which to lend. Banks that receive new government assistance will have to cut the salaries and perks of their executives and sharply limit dividends and corporate acquisitions.

They will also have to make public more information about their lending practices. A Treasury fact sheet said that banks would have to state monthly how many new loans they make, but stopped short of ordering banks to issue new loans or requiring them to account in detail for the federal money.

Mr. Obama, in the ABC News interview, suggested that banks would be required to reveal more about their mortgage holdings.

“Essentially what you’ve got are a set of banks that have not been as transparent as we need to be in terms of what their books look like. And we’re going to have to hold out the Band-Aid a little bit and go ahead and just be clear about some of the losses that have been made because until we do that, we’re not going to be able to attract private capital into the marketplace.”

The day was the first big test of Mr. Geithner as Treasury secretary, who has one of the toughest sells in America: convincing lawmakers and taxpayers that they should again bail out the very banks whose mistakes contributed to the loss of more than three million jobs and caused acute financial pain.

It was clear during the hours he spent before the cameras and lawmakers that he was well-spoken and thoughtful. But his career until now had played out behind the scenes as a civil servant and a central banker. He occasionally lapsed into financial jargon and struggled to connect to a broader public audience.

As the day wore on, Mr. Geithner faced growing skepticism from Democratic and Republican lawmakers, many of them channeling deep voter disgust with the way the government has handled the bailout over the last nine months.

Even Democrats who are supportive of the administration said that it had failed to provide more information about how it would be spending the remaining money in the bailout program.

“We need more details from Treasury on how exactly it plans to remove bad assets while protecting the taxpayer,” said Senator John Kerry, the Massachusetts Democrat who is a senior member of the Senate Finance Committee. “We have zombie banks that are weighed down because their liabilities exceed their assets. Without a precise mechanism for addressing toxic assets, it will be difficult to increase lending.”

The pessimism seemed to indicate that Mr. Geithner missed the mark with one of his shorter-term goals — to quickly instill confidence that the Obama administration has a coherent approach to the banking crisis and that the transparency and oversight of the new program will differ markedly from the Bush administration’s management of the first $350 billion that Congress authorized last year for the Troubled Asset Relief Program, or TARP.

“The spectacle of huge amounts of taxpayer money being provided to the same institutions that helped cause the crisis, with limited transparency and oversight, added to the public distrust,” the Treasury secretary said, in a clear swipe at the Bush administration.

“We will have to try things we’ve never tried before. We will make mistakes. We will go through periods in which things get worse and progress is uneven or interrupted,” Mr. Geithner said.

Representative Barney Frank, the Massachusetts Democrat who heads the House Financial Services Committee, criticized the Obama administration for not putting out more details and said it should commit more than $50 billion to avert home foreclosures.

“The secretary said the administration would present details of their foreclosure reduction plan in a few weeks, which is too much time,” Mr. Frank said.

Appearing on Tuesday afternoon before the Senate banking committee, Mr. Geithner vowed to move quickly to provide more details. But Republicans were skeptical.

“Is there a concrete plan here?” Richard Shelby of Alabama, the senior Republican on the committee, asked Mr. Geithner point blank, after noting that Mr. Geithner had been part of the leadership involved in last year’s bailout efforts. “What is different about the process that you are offering here to devise your plan such that we should have confidence that it is well thought out?”

There was also withering criticism from Wall Street. Ethan Harris, co-head of United States economics research at Barclays Capital, said the program was “shock and uh.” He said the Treasury made a “tactical mistake” by building up expectations about a plan before it had much to announce.

“What’s striking is that these are not new issues that they are facing,” Mr. Harris said. “These are the same issues that the Treasury faced last fall — how do we price the assets? The fact that it’s so been so difficult to figure out the answer may tell you something about whether it’s worth doing or not.”

Mr. Harris warned that setting up a so-called bad bank would be very expensive, as Mr. Geithner himself acknowledged when he set the goal of creating a fund that would reach $1 trillion. Frank Pallotta, a former managing director at Morgan Stanley and a veteran mortgage trader, said the gap was so wide between what banks were valuing their assets and what investors were willing to pay that the government would attract investors to buy only if it provided a subsidy of one form or another.

“Right now, the banks aren’t selling anything,” said Mr. Pallotta, now a consultant to both buyers and sellers of distressed mortgages. “You have Chase thinking that its assets are worth 75 cents on the dollar, and Joe Hedge Fund who thinks they are only worth 45 or 25. There is a huge gap, and the government has to find out if there is some middle point where they can get in.”

Mr. Pallotta said he did not fault the Treasury for failing to offer specifics yet, but he said it could not delay for long. “If we don’t hear in the next 30 days about how this thing will flesh out, then I would be upset.”

Jeff Zeleny contributed reporting from Fort Myers, Fla.

WASHINGTON — Senate Democrats reached an agreement with Republican moderates on Friday to pare a huge economic recovery measure, clearing the way for approval of a package that President Obama said was urgently needed in light of mounting job losses.

The deal, announced on the Senate floor, was a result of two days of tense negotiations and political theater. Mr. Obama dispatched his chief of staff to Capitol Hill to help conclude the talks and reassure senators in his own party, and he called three key Republicans to applaud them for their patriotism.

Earlier, when it looked as if a vote might take place Friday night, officials said, a government plane was dispatched to Florida to bring back Senator Edward M. Kennedy, a Massachusetts Democrat who has brain cancer.

The fine print was not immediately available, and the numbers were shifting. But in essence, the Democratic leadership and two centrist Republicans announced they had struck a deal on about $110 billion in cuts to the roughly $900 billion legislation — a deal expected to provide at least the 60 votes needed to send the bill out of the Senate and into negotiations with the House, which has passed its own version.

The pact, which is expected to be approved in the next few days, was concluded just hours after the Labor Department announced that 598,000 jobs were lost in January. The contraction in jobs is already steeper than in any other recession since at least the early 1980s. And economists warn that several more shoes are about to drop, a message that added urgency to the Senate deliberations.

As the negotiations were under way, lawmakers said it was time to stop quibbling about the exact parameters of the legislation — which mixes safety-net spending, tax cuts and a huge infusion of dollars into federal programs — and to begin work toward a final agreement that could be sent to Mr. Obama next week.

“Our country can’t wait another day for another approach,” said Senator Ben Nelson, a Nebraska Democrat who is a leader of the bipartisan coalition that worked out the agreement.

The details were negotiated at an afternoon meeting in the office of the Senate majority leader, Harry Reid of Nevada, involving Mr. Reid, other top Democrats and two Republicans, Susan Collins of Maine and Arlen Specter of Pennsylvania. After they came to terms, the senators brought in the White House chief of staff, Rahm Emanuel, for assurance that the deal was acceptable to the administration. Mr. Emanuel signaled it was.

“With today’s unemployment numbers reaching more than 3.6 million workers,” Mr. Emanuel said after the session, “delay and failure were not an option.”

Mr. Obama called Ms. Collins and Mr. Specter, as well as Senator Olympia J. Snowe of Maine, another Republican expected to support the deal, to acknowledge they were acting against pressure from their party and, one official said, to thank them for their patriotism in helping advance the bill at a critical time.

Earlier in the day, Mr. Obama urged Congress to act expeditiously. “It is inexcusable and irresponsible for any of us to get bogged down in distraction, delay or politics as usual while millions of Americans are being put out of work,” said Mr. Obama, who has recently shown less patience for Republican resistance to the bill.

Most Senate Republicans remained opposed to the measure, criticizing it as a case study in excessive spending that would do little to lift the economy. Some conservatives indicated Friday night that they would push for time to study the new legislation before any final vote.

“We want to stimulate the economy, not mortgage the future of our children and grandchildren by the kind of fiscally profligate spending embodied in this legislation,” said Senator John McCain of Arizona, the defeated Republican presidential nominee, who has emerged as a chief opponent of the proposal.

Republicans were clearly irritated at the outcome and faulted those involved in working out the bargain. “When you say this was the best we could do, I disagree with you,” Senator Lindsey Graham of South Carolina said on the floor. “This not remotely close to what we could have done if we had sat down in a true bipartisan fashion and found a better way.”

The Senate’s proposed cuts took aim at an array of popular spending programs that critics said should not be part of a fiscal recovery bill, even if they represent laudable policy goals, because they would not deliver a quick enough jolt to the economy.

Even Mr. Obama’s signature tax cut for middle-class Americans was scaled back as part of the deal. Under the new plan, tax credits of up to $500 for individuals and $1,000 for couples would begin to phase out at lower income levels than first proposed, saving the government $2 billion.

The biggest cut, roughly $40 billion in aid to states, was likely to spur a fierce fight in negotiations with the House over the final bill. Many states, hit hard by the recession, face wrenching cuts in services and layoffs of public employees as they struggle to comply with laws requiring them to balance their budgets.

When debate began this week, the price tag on the Senate version of the stimulus bill was roughly $884 billion, but it grew to more than $900 billion as senators added provisions including tax breaks totaling $30 billion for purchases of homes and cars.

Lawmakers said that by poring over the 736-page bill they had excised about $110 billion, bringing the total cost to about $780 billion — $40 billion less than the stimulus bill approved by the House last week. Because of consumer tax breaks and spending for health research that had been added in the Senate, the new total for the measure could be about $820 billion. But even the senators behind the compromise were uncertain of the number.

In addition to the large cut in state aid, the Senate agreement would cut nearly $20 billion proposed for school construction; $8 billion to refurbish federal buildings and make them more energy efficient; $1 billion for the early childhood program Head Start; and $2 billion from a plan to expand broadband data networks in rural and underserved areas.

The administration had initially hoped that it could win the support of as many as 80 senators, but that goal disappeared after House Republicans voted unanimously against the measure. As questions were raised about the total spending, getting even three or four Republican senators to sign on became difficult.

Ms. Collins said she believed the changes had significantly improved the measure. Mr. Specter said that while he still had reservations, he had come to accept Mr. Obama’s push to enact the economic plan by mid-February. “I believe we do have to act,” Mr. Specter said, “and under the circumstances this is the best we can do.”

But several other Republicans who had taken part in the talks said they could not support the compromise.

“Unfortunately, there was too much in the Democratic counterproposal that was not stimulative,” said Senator George V. Voinovich of Ohio, “and that did not provide the jump-start our economy so desperately needs.”

The Senate Republican leader, Mitch McConnell of Kentucky, said most Republicans remained unconvinced that the package would reinvigorate the economy.

“You have to balance the likelihood of success versus the crushing debt that we’re levying on the backs of our children, our grandchildren and, yes, their children,” Mr. McConnell said.

Mr. Reid urged Republicans to get behind the plan. “This is a critical day for this new Congress and our country,” he said. “Faced with this grave and growing economic crisis, Republicans must decide today whether they will join the president and Congressional Democrats on that road to recovery.”

HHS Pick Built Connections Over Decades

By Ceci Connolly
Washington Post Staff Writer
Tuesday, February 3, 2009

As he battles this week to save his nomination to be secretary of health and human services, one thing is certain: No one in Washington has a better-positioned network of allies in the Obama administration than Thomas A. Daschle.

Over three decades on Capitol Hill, including 10 years as the Senate Democratic leader, Daschle has nurtured one of the largest, most experienced talent pools in the city. His charges guided Barack Obama from his first days in the Senate, through the presidential race and into the White House. Daschle’s tentacles, moreover, stretch far beyond the agency Obama picked him to lead, reaching across the entire administration from the upper echelons of the White House to mid-level departmental positions to Obama’s kitchen cabinet.

The network is being tapped this week as Daschle and his allies scramble to explain why he did not pay more than $100,000 in back taxes, primarily for the use of a car and driver for three years. After a 75-minute closed-door meeting yesterday with the Senate Finance Committee, he emerged ashen-faced and apologetic. His confirmation vote has been postponed until at least the middle of next week.

Republicans remained noncommittal yesterday, weighing the costs and benefits of perhaps killing the nomination of a former colleague and close personal friend of the president. Democrats rose to Daschle’s defense, including, most notably, the man who would be without much of his top staff were it not for Daschle.

Asked yesterday morning whether he stands by Daschle, Obama said firmly: “Absolutely.”

If he weathers the tax controversy, Daschle is likely to be one of the best-connected Cabinet secretaries in the administration, if not history.

At least a dozen Daschle alumni are stepping into the highest positions of the federal government. Already, Obama and Vice President Biden have tapped Daschle veterans to manage their staffs, guide foreign policy and craft public relations strategy. In addition to the new HHS chief of staff, the chiefs of staff to Biden, the National Security Council and Treasury Secretary Timothy F. Geithner all worked for Daschle. His allies oversaw Obama’s transition team — including vetting Daschle himself — and one serves as the president’s personal lawyer.

“This is notable for the breadth and scope and number,” said Chris Jennings, who was the Clinton administration point man on health care and knows the challenges of navigating the White House bureaucracy.

As news broke over the weekend that Daschle had made several tax errors, many of those former colleagues and aides helped mount a defense, praising his integrity on talk shows, in news releases and in whispered asides. Not a single lawmaker has called for him to withdraw.

But the real potency of the network will come if Daschle is confirmed, said Ross K. Baker, a political scientist at Rutgers University. With such well-placed, trusted advisers, he would be in a position to promote his priorities and shape policy well beyond the contours of his department.

“The fact that he has eyes and ears in the White House, rather than way down in the HHS bureaucracy, is really an advantage,” Baker said. He likened Daschle’s sphere of influence to the broad power that Henry Kissinger held as secretary of state in the Nixon administration.

“Geography is determinant of influence,” he said. “To have people proximate to the president is a real advantage.”

Like Daschle, Secretary of State Hillary Rodham Clinton can lay claim to an impressive network of insiders, developed during her husband’s eight years in the Oval Office and her eight in the Senate. Many have worked for Daschle as well. But the Clinton coalition has become fractured and she carries the lingering scars of a contentious fight with Obama in the Democratic presidential primaries.

By contrast, Daschle and Obama share an uncommon bond, forged during the 2004 campaign. Many — including aides to Daschle — had expected him to seek the White House. But the South Dakotan lost a nasty reelection fight, and the young Illinois legislator burst onto the national scene and into the U.S. Senate.

“Tom was the first guy to go with Obama” in the pre-presidential campaign season, said Frederick H. Graefe, a Washington lobbyist and one of Daschle’s oldest friends. “He told him, ‘Run now, don’t wait, don’t make the mistake I made. I’ll give you everybody I have — the campaign team, the personal staff, leadership staff, fundraising lists — lock, stock and barrel.’ ”

“It was a ready-made team,” Graefe added.

As a Senate leader with authority over not just his personal staff but several policy and campaign committees as well, Daschle employed more than 100 people at any given time. From 1994 to 2005, even more than the Clinton White House, “the University of Daschle” was the place to learn the inner workings of governing, Baker said.

More than half a dozen Daschle veterans hold high-ranking White House positions, most notably Pete Rouse, who was his chief of staff and is now senior adviser to the president, and Phil Schiliro, Obama’s legislative liaison.

Daschle-ites are also taking positions at the Agriculture Department and the Democratic National Committee. Some of his closest allies are among Obama’s most trusted outside advisers, a select group whose influence comes not from a title but from a personal bond. They include John D. Podesta, the Center for American Progress president who masterminded Obama’s transition; lawyer Robert Bauer; and political consultant Anita Dunn.

“The spokes of the wheel all lead to Pete Rouse,” said Dunn, who has deep ties to both men. “When Pete went to work for Barack, what Barack got — and I don’t think he realized it — was the only network in Democratic circles that from both a policy and political perspective came close to the Clinton network.”

Rouse got his start in Washington in the early 1970s when he and Daschle were young aides to then-Sen. James Abourezk (D-S.D.). In 1986, he began an 18-year stint with Daschle.

When Daschle lost in 2004, he encouraged his team to sign on with Obama. Rouse agreed and eventually recruited many of Obama’s top aides, including Schiliro and the husband-and-wife team Dan Pfeiffer and Sarah Feinberg.

If confirmed, Daschle will be “HHS secretary plus,” said Dunn, referring to the additional role as head of the new White House Office of Health Reform, which has a small but well-situated office in the basement of the West Wing.

If Daschle were working at HHS headquarters, his “embeds,” as Dunn calls them, could provide “an extraordinary level of information and access that most Cabinet secretaries don’t have.”

“It’s a matter of him not having to go in and forge relationships,” she said. “Daschle gets to deal directly with people he knows and is comfortable with.”

If as HHS secretary he wanted to tweak health tax policy, his longtime chief of staff, Mark Childress, would need only pick up the phone and call former colleague Mark Patterson, Geithner’s chief of staff. If there were an international health issue to resolve, Childress could contact Daschle alums Mark Lippert at the NSC and Denis McDonough on the White House staff.

And if Daschle needed assistance from Biden, he could turn to Ron Klain, the vice president’s chief of staff, who oversaw the Senate Democratic Leadership Committee for Daschle in 1995. Biden was making calls on Daschle’s behalf yesterday.

The Daschle hires that Obama has made are the “cream of the crop” of the Democratic establishment, Jennings said.

“People outside the Daschle orbit recognize his friendship with and influence with President Obama,” he said. “It’s the cumulative perceptions of his respect and influence within the administration and his former staff. Whether it’s an accurate perception or not, perception is reality in Washington.”

Staff writers Paul Kane and Joe Stephens and research editor Alice Crites contributed to this report.

UPDATE

Daschle Ends Bid for Post; Obama Concedes Mistake

WASHINGTON — Tom Daschle withdrew his nomination as secretary of health and human services on Tuesday after weathering four days of scrutiny over unpaid taxes, prompting President Obama to concede having “screwed up” in undermining his own ethical standards by pushing the appointment.

“I’ve got to own up to my mistake, which is that ultimately it’s important for this administration to send a message that there aren’t two sets of rules,” Mr. Obama said in an interview with NBC News. “You know, one for prominent people and one for ordinary folks who have to pay their taxes.”

Mr. Daschle, a closer confidant to Mr. Obama than any other cabinet nominee, had offered to step down over the weekend, but officials close to both men said Mr. Obama had urged him to fight for confirmation.

Mr. Daschle went to Capitol Hill on Monday to keep his confirmation on track, but by Tuesday morning, with the pressure showing no signs of easing, he told the president that he believed he had become a distraction and too wounded to be effective.

It was the rockiest day yet for the new White House. Two hours before Mr. Daschle withdrew, Mr. Obama’s nominee to be the chief White House performance officer, Nancy Killefer, pulled her name from consideration because of unpaid payroll taxes for a household employee.

The developments distracted attention from Mr. Obama’s effort to push his economic stimulus plan through the Senate and complicated the initiative that Mr. Daschle was to have led, his plan for overhauling the health care system.

The nominees’ tax problems also gave Republicans a new argument against Mr. Obama and his party as the economic debate proceeds: that Democrats are cavalier about taxing other people because they do not abide by the tax laws themselves.

In evening interviews on broadcast and cable television networks, Mr. Obama said he took responsibility for the errors. “And so I’m frustrated with myself, with our team,” he told NBC, “but ultimately my job is to get this thing back on track because what we need to focus on is a deteriorating economy and getting people back to work.”

He added, “I’m here on television saying I screwed up and that’s part of the era of responsibility.”

Mr. Daschle delivered the news in a call on Tuesday morning to Mr. Obama, who was in his study, just off the Oval Office. He also stepped down from his position as White House heath czar, a job with a West Wing office.

Mr. Daschle said Monday that his failure to pay $128,000 in taxes for the use of a friend’s chauffer and car service was “completely inadvertent.”

Declining an interview request on Tuesday afternoon, Mr. Daschle said in a brief statement distributed by the White House that he would not have been able to lead an overhaul of the nation’s health care system “with the full faith of the Congress and the American people.”

“I am not that leader,” Mr. Daschle said, “and will not be a distraction.”

The withdrawals by the two advisers represent the highest-level political casualties of the young administration and raised fresh questions about the vetting procedures for officials already selected and scores of positions that remain open.

Senate Republicans signaled their intention to step up scrutiny of all appointees. Treasury Secretary Timothy F. Geithner was confirmed last week after apologizing and weathering weeks of criticism for late payment of $34,000 in income taxes.

Both Mr. Daschle and Ms. Killefer pulled out on their own accord, officials said, after their tax returns were scrutinized by the Senate Finance Committee. On the campaign trail, Mr. Obama often expressed frustration to aides about the practice of cutting loose advisers at the first sign of political trouble.

“They both decided and recognized that their nominations would distract from the important goals and the critical agenda that the president put forward,” Robert Gibbs, the White House press secretary, said Tuesday.

Asked repeatedly whether the White House had quietly urged Mr. Daschle to step aside to quell the controversy, Mr. Gibbs said, “He did not get a signal.”

Among the people mentioned as possible candidates for the job of health secretary are Gov. Kathleen Sebelius of Kansas, a former state insurance commissioner; former Gov. John A. Kitzhaber of Oregon, a doctor; and Gov. Jennifer M. Granholm of Michigan. All are Democrats.

In the Senate, Democrats were caught by surprise by Mr. Daschle’s decision, particularly after his appearance at the Finance Committee on Monday, as well as several indications that he could win confirmation.

But Republicans were intensifying their criticism of his tax failings, and Senator Harry Reid of Nevada, the majority leader, said Mr. Daschle told him in a phone call on Tuesday morning that he believed the nomination was getting too much attention.

Senator Richard J. Durbin of Illinois, the No. 2 Democrat in the Senate, said Mr. Daschle, the former Senate majority leader, had done “the honorable thing to spare his family, the president and his colleagues in the Senate from a tough political battle that would lie ahead.”

Mr. Durbin added, “I think he would have prevailed in the end, but it would have taken a while, and there would have been some suffering.”

The day had been scripted by advisers to turn the page on the tax controversy and refocus on the economy. In a rare move, television anchors for five broadcast and cable networks had been invited to interview Mr. Obama about the urgency of passing the economic recovery plan, a decision that magnified the troubles at the White House by giving them increased prominence on the evening news.

He delivered almost precisely the same mea culpa to each of the anchors as they cycled through the Oval Office.

Hours earlier, as his advisers huddled in the West Wing to shape a strategy for responding to the dizzying turn of events, Mr. Obama and his wife, Michelle, made an unscheduled stop at a public school not far away.

“We were just tired of being in the White House,” Mr. Obama told second graders at Capital City Public Charter School.

Senator John Kerry, Democrat of Massachusetts, who sits on the Finance Committee, said he believed Mr. Daschle should not have withdrawn his name.

“I believe that when the smoke clears and the frenzy has ended, no one will believe that this unwitting mistake should have erased 30 years of selfless public service and remarkable legislative skill and expertise on health care,” Mr. Kerry said.

In the case of Ms. Killefer, administration officials said she had failed to pay more than a year’s worth of unemployment taxes on household help.

The District of Columbia filed a $946.69 tax lien on her home in 2005 for failure to pay the tax. That was disclosed to the Senate Finance Committee, but officials said her tax records were being further scrutinized.

“I recognize that your agenda and the duties facing your chief performance officer are urgent,” Ms. Killefer wrote in a letter to Mr. Obama on Tuesday.

“I have also come to realize in the current environment that my personal tax issue of D.C. unemployment tax could be used to create exactly the kind of distraction and delay those duties must avoid.”

Ms. Killefer, head of the Washington office of the consulting firm McKinsey & Company, was named to the new position on Jan. 7. In the announcement, Mr. Obama said she would help “restore the American people’s confidence in their government.”

He said at the time that her role would be to scour the budget for wasteful or inefficient spending.

Robert Pear and Carl Hulse contributing reporting.

BAGHDAD — Iraqis across the country voted Saturday in provincial elections that will help shape their future, but regardless of the outcome it is clear that the Americans are already drifting offstage — and that most Iraqis are ready to see them go.

The signs of mutual disengagement are everywhere. In the days leading up to the elections, it was possible to drive safely from near the Turkish border in the north to Baghdad and on south to Basra, just a few miles from the Persian Gulf — without seeing an American convoy. In the Green Zone — once host to the American occupation government, and now the seat of the Iraqi government — the primary PX is set to close, and the Americans have retreated to their vast, garrisoned new embassy compound. Iraqi soldiers now handle all Green Zone checkpoints.

American helicopters and drones may be in the sky, but Iraqi boots are on the ground. The Americans are already worried about securing the road to Kuwait because soon they will have to start hauling out much of the infrastructure they have built on bases across Iraq.

The end of an era comes not in a single moment, but looking back it has become evident that the mood has changed, power has shifted, the world is not the same.

In the United States, many Americans view the war as already over, even though more than 140,000 American soldiers remain on Iraqi soil.

President Obama has made it plain that Iraq is not his war; he wants to focus on Afghanistan. In an economic crisis, there is simply not enough money for the country to keep spending hundreds of millions of dollars a day in Iraq.

Any arguments that remain in Washington about the shape and timing of the troop withdrawal this year seem almost moot here, given how much Iraqis want to show they can govern on their own and how much Americans want to hand over responsibility to the Iraqis so they can meet withdrawal deadlines.

This is not to suggest that the war is over. In two provinces, Nineveh and Diyala, counterinsurgency operations are still under way, and the military is tracking signs of activity by Sunni extremist groups in the troubled areas surrounding Baghdad. For now, the rest of the country is mostly calm. The provincial elections will test political stability: whether Iraqis can begin to resolve still festering sectarian and ethnic tensions through the ballot box. The formal process of disengagement started in earnest in November, when the Iraqi Parliament approved a new security agreement with the Americans that sealed the date of departure, by the end of 2011, and almost immediately changed the balance of power.

The outlook of Iraqi citizens has changed as well. They are more confident that their problems are their own, and that the Americans cannot fix them and often have only made matters worse.

“The American military presence brought nothing to our streets but destruction and chaos,” said Omar al-Dulaimi, 57, a government employee who lives near the Um al-Khoura mosque, one of the largest Sunni places of worship in the capital. “We had nothing from them but tension and confusion. It’s much better for us and for them if they stay in their bases now.”

That resentment of the American presence boiled over in 2007 after Blackwater Security guards opened fire on Iraqi civilians in Nisour Square, killing 17 of them and wounding more than 30. That episode, which was widely publicized in Iraq and abroad, crystallized Iraqi loathing and resentment of what they saw as Americans’ casual disregard for Iraqi lives — and their own powerlessness to hold the Americans to account.

Such anger helped embolden Iraqis to drive a tough bargain on the security agreement, which cemented their sense that they were, at last, seizing control of their own destiny. The Iraqi resolve surprised the Americans, who in the end were forced to accept a hard deadline for departure, give up immunity for contractors like Blackwater and give Iraqis explicit authority over all military operations in the country.

Now, for both sides there is the feeling that something has changed and that whatever happens next, Iraq will not return to the way it was.

“We’re going through transition in Iraq at the same time we’re going through transition in our forces here,” said Gen. Ray Odierno, the commanding general for Iraq. “They will elect new provincial governments. I believe 75 percent to 80 percent of the provincial governments will change, and oh, by the way, we’ll begin to reduce our troops’ size.”

The shifts are subtle, often unspoken. The American military role now has less to do with protecting Iraqis and more with giving them the psychological reassurance that they can handle what comes their way. The Americans no longer tell the Iraqis what to do, and the Iraqis, especially Iraqi Army officers, no longer look to the Americans for approval. At least that is the case in areas where the fighting has stopped; less so in areas like Mosul where American military might is still required to keep violence at bay.

When General Odierno stopped to inspect a polling center in rural Medaen, south of Baghdad, on Wednesday, his conversation with the Iraqi Army general who oversees the area was respectful, a little formal: two military men exchanging information. It was not exactly a conversation between equals; each knew that the other was from a different world, each knew the Americans have superior arms and training, and each offered the other his observations.

“I see less Sunni-Shia issues than I do a lot of other issues here,” General Odierno said.

Gen. Qassim al-Maliki nodded. “We have a lot of Shia voting this time,” he said. “We didn’t have a lot in the last election,” he said.

As the American military slowly steps back, the diplomats and the civilians are emerging from the wings. Certainly, this is far from a normal diplomatic relationship. Iraqis entering any area close to the Americans are still subject to multiple humiliating searches and interminable waits. American diplomats cannot yet leave the embassy; they live like virtual prisoners, every movement beyond its gates an armed undertaking. But it is possible for Americans and Iraqis to talk about issues other than sheer survival.

Iraqis, too, are beginning to explore a different kind of relationship, one that no longer looks to the Americans only for protection. Prime Minister Nuri Kamal al-Maliki has agreed to finance a substantial scholarship program to send Iraqis to the United States and British Commonwealth countries for study, in an effort to create a better educated professional class. Still, the American era in Iraq is nowhere near a final act. If this were an opera, it would be just past midway in the libretto. While both sides are disconnecting, neither can let go entirely.

The Iraqis need the Americans not just to dampen terrorist activities within the country but to protect them from predatory neighbors. Syria and Iran have interfered here since the invasion, and while the Iraqis are often uncomfortable with how the Americans have reined in these powers, they are reluctant to stop them because they fear their neighbors more.

When American forces pursued insurgents over the Iraqi border into Syria in late October, it was an international incident. Iraq was embarrassed in front of the Arab world. Such incidents are likely to recur and could become much more fraught.

For the United States, Iraq remains a strategic prize close to the Middle East flash points of Israel, Lebanon and Syria as well as Iran and the oil-rich Persian Gulf countries. It is not by chance that the Central Intelligence Agency has its largest station in the world in Baghdad.

It is inescapable that the United States exerts more influence here than in any other oil-producing country — and will be intent on continuing to do so. Iraq will be eager to demonstrate its independence; the United States will have to rely on levers other than a huge and continuing military presence. This promises considerable tension as each side redefines its relationship.

The elections on Saturday were a step toward a peaceful approach to settling disagreements among factions about the shape of the country. If new governments are seated from north to south and east to west, the United States and Iraq can begin the next act in earnest.

If all goes well, “The United States will not need big troops here,” said Jawad al-Bolani, the interior minister, a secular Shiite. “The Americans need to look at something besides security. Iraq needs America to start a new chapter.”

Riyadh Mohammed contributed reporting from Baghdad.

WASHINGTON — Without a single Republican vote, President Obama won House approval on Wednesday for an $819 billion economic recovery plan as Congressional Democrats sought to temper their own differences over the enormous package of tax cuts and spending.

As a piece of legislation, the two-year package is among the biggest in history, reflecting a broad view in Congress that urgent fiscal help is needed for an economy in crisis, at a time when the Federal Reserve has already cut interest rates almost to zero.

But the size and substance of the stimulus package remain in dispute, as House Republicans argued that it tilted heavily toward new spending instead of tax cuts.

All but 11 Democrats voted for the plan, and 177 Republicans voted against it. The 244-to-188 vote came a day after Mr. Obama traveled to Capitol Hill to seek Republican backing, if not for the package then on other issues to come.

Mr. Obama, in a statement hailing the House passage of the plan, did not take note of the partisan divide but signaled that he expected changes to be made in the Senate that might attract support.

“I hope that we can continue to strengthen this plan before it gets to my desk,” he said. “But what we can’t do is drag our feet or allow the same partisan differences to get in our way. We must move swiftly and boldly to put Americans back to work, and that is exactly what this plan begins to do.”

Mr. Obama followed the House vote with a cocktail party at the White House for the Congressional leaders of both parties, from the House and the Senate. The House Republicans, including the minority leader, Representative John A. Boehner of Ohio, were fresh from their votes against the recovery package.

The failure to win Republican support in the House seemed to echo the early months of the last Democratic administration, when President Bill Clinton in 1993 had to rely solely on Democrats to win passage of a deficit-reduction bill that was a signature element of his presidency.

Mr. Obama’s chief of staff, Rahm Emanuel, had met Tuesday night at the White House with 11 moderate House Republicans, none of whom ended up supporting the bill. “The most important number here for this recovery plan is how many jobs it produces, not how many votes it gets,” Mr. Emanuel said.

As Senate Democrats prepare to bring their version of the package to the floor on Monday, House Democrats and the administration indicated they would ultimately accept a provision in the emerging Senate package that would adjust the alternative minimum tax to hold down many middle-class Americans’ income taxes for 2009. The provision was not in the House legislation.

Its cost would drive the overall package’s tally to nearly $900 billion. That would exceed the roughly $850 billion limit that Mr. Obama has set for Congress, House Democratic leadership aides said, and leave no room for other proposals that senators of both parties are poised to seek during Senate debate next week.

While the House and Senate measures are similar, they are most likely to differ in ways that could snarl negotiations between Democrats from the two chambers, and delay getting a measure to the president. In particular, House and Senate Democrats are split over how to divide $87 billion in relief to the states for Medicaid, with senators favoring a formula more beneficial to less-populous states.

Democrats’ own differences aside, they also are under pressure from the White House to be open to proposals from Senate Republicans who might support the final legislation if their interests are accommodated, and which might draw a few Republican supporters on a final vote next month in the House.

The provision on the alternative minimum tax, for example, was a priority for Senator Charles E. Grassley, Republican of Iowa, who added it Tuesday in the Finance Committee’s work on the legislation.

Democrats’ goal is to have the stimulus package, which is roughly two-thirds new spending and one-third tax cuts, to Mr. Obama’s desk for his signature by Feb. 13, before Congress breaks for Presidents’ Day.

“He said he wanted action, bold and swift, and that is exactly what we’re doing today,” Speaker Nancy Pelosi, Democrat of California, said as debate began.

Democrats voluntarily dropped from the package several provisions that Republicans had singled out for derision in recent days, including money to restore the Jefferson Memorial and for family planning programs. But the day’s debate contrasted with the president’s conciliatory gestures.

Representative Virginia Foxx, Republican of North Carolina, said that former President George Bush’s signature tax cuts in 2001 had created years of growth but that the nation’s problems started when Democrats regained majorities in Congress in the 2006 elections.

Representative Steny H. Hoyer, Democrat of Maryland and the majority leader, said that “the economics that got us into this mess” were the Republicans’ policies for the six years that Republicans controlled both the White House and Congress, through 2006.

The House voted down several Republican proposals, including a substitute package made up entirely of tax cuts for individuals and businesses. Republicans did not say how much their package would cost, although Mr. Boehner said it would be far less than the Democratic plan. That tax-cut-only approach was defeated on a mostly party-line vote of 266 to 170; two Democrats joined all but nine moderate Republicans in voting for the Republican plan.

By another near-party-line vote, 270 to 159, the House rejected a Republican plan to delete a number of spending programs, including several representing top campaign promises of Mr. Obama, and to add instead $36 billion for highway construction, more than doubling the $30 billion in the bill, and $24 billion for Army Corps of Engineers projects.

After the final vote, Representative Eric Cantor of Virginia, the second-ranking House Republican, called the Democratic package “a spending bill beyond anyone’s imagination.”

Some Democrats seemed surprised that no Republicans voted for the measure.

“Not one person felt his or her district needed to have any of this assistance?” Representative Rosa DeLauro, Democrat of Connecticut, asked of the Republicans. “That can’t be.”

Brad Woodhouse, president of the union-supported, pro-Democratic group Americans United for Change, e-mailed a statement condemning the Republicans’ opposition under the subject line “Political Suicide.”

That $355 billion in spending isn’t about the economy.

The stimulus bill currently steaming through Congress looks like a legislative freight train, but given last week’s analysis by the Congressional Budget Office, it is more accurate to think of it as a time machine. That may be the only way to explain how spending on public works in 2011 and beyond will help the economy today.

According to Congressional Budget Office estimates, a mere $26 billion of the House stimulus bill’s $355 billion in new spending would actually be spent in the current fiscal year, and just $110 billion would be spent by the end of 2010. This is highly embarrassing given that Congress’s justification for passing this bill so urgently is to help the economy right now, if not sooner.

And the red Congressional faces must be very red indeed, because CBO’s analysis has since vanished into thin air after having been posted early last week on the Appropriations Committee Web site. Officially, the committee says this is because the estimates have been superseded as the legislation has moved through committee. No doubt.

AP

David Obey.

In addition to suppressing the CBO analysis, Democrats have derided it. Appropriations Chairman David Obey (D., Wis.) called it “off the wall,” never mind that CBO is now run by Democrats. Mr. Obey also suggested that it would be a mistake to debate the stimulus “until the cows come home.” We’d settle for a month or two, so at least the voters can inspect the various Congressional cattle they’re buying with that $355 billion.

The stimulus bill is also a time machine in the sense that it’s based on an old, and largely discredited, economic theory. As Harvard economist Robert Barro pointed out on these pages last Thursday, the “stimulus” claim is based on something called the Keynesian “multiplier,” which is that each $1 of spending the government “injects” into the economy yields 1.5 times that in greater output. There’s little evidence to support this theory, but you have to admire its beauty because it assumes the government can create wealth out of thin air. If it were true, the government should spend $10 trillion and we’d all live in paradise.

The problem is that the money for this spending boom has to come from somewhere, which means it is removed from the private sector as higher taxes or borrowing. For every $1 the government “injects,” it must take $1 away from someone else — either in taxes or by issuing a bond. In either case this leaves $1 less available for private investment or consumption. Mr. Barro wrote about this way back in 1974 in his classic article, “Are Government Bonds Net Wealth?”, in the Journal of Political Economy. Larry Summers and Paul Krugman must have missed it.

The government spending will be a net stimulus only if its $1 goes to more productive purposes than those to which private investors would have put that same $1. There are some ways we may want the government to spend money — on national defense, say — but that doesn’t mean it’s a stimulus.

A similar analysis applies to the tax cuts that are part of President Obama’s proposal. In contrast to the spending, at least the tax cuts will take effect immediately. But the problem is that Mr. Obama wants them to be temporary, which means taxpayers realize they will see no permanent increase in their after-tax incomes. Not being fools, Americans may either save or spend the money but they aren’t likely to change their behavior in ways that will spur growth. For Exhibit A, consider the failure of last February’s tax rebate stimulus, which was a bipartisan production of George W. Bush and Mr. Summers, who is now advising Mr. Obama.

To be genuinely stimulating, tax cuts need to be immediate, permanent and on the “margin,” meaning that they apply to the next dollar of income that an individual or business earns. This was the principle behind the Kennedy tax cuts of 1964, as well as the Reagan tax cuts of 1981, which finally took full effect on January 1, 1983.

If the Obama Democrats can’t abide this because it’s a “tax cut for the rich,” as an alternative they could slash the corporate tax to spur business incentives. The revenue cost of eliminating the corporate tax wouldn’t be any more than their proposed $355 billion in new spending, and we guarantee its “multiplier” effects on growth would be far greater. Research by Mr. Obama’s own White House chief economist, Christina Romer, has shown that every $1 in tax cuts can increase output by as much as $3.

As for all of that new spending, CBO will release an updated analysis this week. And we anticipate that the budget analysts will in the interim have discovered that much more of that $355 billion will somehow find its way to “shovel-ready” projects that the Obama Administration can start building before the crocuses bloom. But in the real world, the CBO’s first estimate is likely to prove closer to the truth.

The spending portion of the stimulus, in short, isn’t really about the economy. It’s about promoting long-time Democratic policy goals, such as subsidizing health care for the middle class and promoting alternative energy. The “stimulus” is merely the mother of all political excuses to pack as much of this spending agenda as possible into a single bill when Mr. Obama is at his political zenith.

Apart from the inevitable waste, the Democrats are taking a big political gamble here. Congress and Mr. Obama are promoting this stimulus as the key to economic revival. Americans who know nothing about multipliers or neo-Keynesians expect it to work. The Federal Reserve is pushing trillions of dollars of monetary stimulus into the economy, and perhaps that along with a better bank rescue strategy will make the difference. But if spring and then summer arrive, and the economy is still in recession, Americans are going to start asking what they bought for that $355 billion.

CARACAS, Venezuela — President Hugo Chávez, buffeted by falling oil prices that threaten to damage his efforts to establish a Socialist-inspired state, is quietly courting Western oil companies once again.

Until recently, Mr. Chávez had pushed foreign oil companies here into a corner by nationalizing their oil fields, raiding their offices with tax authorities and imposing a series of royalties increases.

But faced with the plunge in prices and a decline in domestic production, senior officials have begun soliciting bids from some of the largest Western oil companies in recent weeks — including Chevron, Royal Dutch/Shell and Total of France — promising them access to some of the world’s largest petroleum reserves, according to energy executives and industry consultants here.

Their willingness to even consider investing in Venezuela reflects the scarcity of projects open to foreign companies in other top oil nations, particularly in the Middle East.

But the shift also shows how the global financial crisis is hampering Mr. Chávez’s ideological agenda and demanding his pragmatic side. At stake are no less than Venezuela’s economic stability and the sustainability of his rule. With oil prices so low, the longstanding problems plaguing Petróleos de Venezuela, the national oil company that helps keep the country afloat, have become much harder to ignore.

Embracing the Western companies may be the only way to shore up Petróleos de Venezuela and the raft of social welfare programs, like health care and higher education for the poor, that have been made possible by oil proceeds and have helped bolster his popular support.

“If re-engaging with foreign oil companies is necessary to his political survival, then Chávez will do it,” said Roger Tissot, an authority on Venezuela’s oil industry at Gas Energy, a Brazilian consulting company focusing on Latin America. “He is a military man who understands losing a battle to win the war.”

While the new oil projects would not be completed for years, Mr. Chávez is already looking beyond the end of his current term in 2012 by putting forward a referendum, expected as early as next month, that would let him run for indefinite re-election.

In recent years, Mr. Chávez has preferred partnerships with national oil companies from countries like Iran, China and Belarus. But these ventures failed to reverse Venezuela’s declining oil output. State-controlled oil companies from other nations have also been invited to bid this time, but the large private companies are seen as having an advantage, given their expertise in building complex projects in Venezuela and elsewhere in years past.

The bidding process was first conceived last year when oil prices were higher but Petróleos de Venezuela’s production decline was getting impossible to overlook. Still, the process is moving into high gear only this month, with the authorities here expected to start reviewing the companies’ bidding plans on new areas of the Orinoco Belt, an area in southern Venezuela with an estimated 235 billion barrels of recoverable oil. Altogether, more than $20 billion in investment could be required to assemble devilishly complex projects capable of producing a combined 1.2 million barrels of oil a day.

Mr. Chávez’s olive branch to Western oil companies comes after he nationalized their oil fields in 2007. Two companies, Exxon Mobil and ConocoPhillips, left Venezuela and are still waging legal battles over lost projects.

But Venezuela may have little choice but to form new ventures with foreign oil companies. Nationalizations in other sectors, like agriculture and steel manufacturing, are fueling capital flight, leaving Venezuela reliant on oil for about 93 percent of its export revenue in 2008, up from 69 percent in 1998 when Mr. Chávez was first elected.

In the past year, with higher oil prices paving the way, Mr. Chávez also vastly expanded Petróleos de Venezuela’s power, inextricably linking it to his political program. He directed the oil company to build roads, import and distribute food, build docks and shipyards and set up a light-bulb factory. He even expanded it into areas like milk production, soybean farming and the training of athletes after a weak performance at the Beijing Olympics.

One of the oil company’s ventures sells subsidized food and extols Mr. Chávez’s leadership at its stores across Venezuela. At one frenzied store in eastern Caracas, posters hung from the ceiling last Saturday showing Mr. Chávez arm in arm with children beneath the heading, “fortifying agrarian socialism.”

Petróleos de Venezuela has also carried out nationalizations in other industries, absorbing companies like Electricidad de Caracas, the utility serving this city of five million. Top executives like Eulogio del Pino, the Stanford-educated vice president for exploration and production, spent much of 2008 negotiating unfinished deals like the takeover of a cement company.

But all the while, Petróleos de Venezuela has faced its own difficulties. It claimed it produced about 3.3 million barrels a day throughout most of 2008. But other sources, like OPEC, of which Venezuela is a member, place the figure closer to 2.3 million and show a fall of about 100,000 barrels a day from a year earlier. When Mr. Chávez rose to power a decade ago, Venezuela was producing about 3.4 million barrels a day.

Rafael Ramírez, the energy minister and president of Petróleos de Venezuela, did not respond to requests for an interview. But energy executives here with contacts within Petróleos de Venezuela said Mr. Ramírez, a confidant of Mr. Chávez, has been waging a struggle within the company to refocus operations toward producing more oil.

After weathering the turmoil of recent years, Western oil companies here are loath to speak publicly about their plans. “We don’t elaborate on bidding processes beyond the fact that we evaluate every opportunity and our decisions will be based on economics and other factors,” said Scott Walker, a spokesman for Chevron.

But energy executives here speak with restrained optimism. Nineteen companies paid $2 million each last month for data on areas open for exploration, twice what such data costs elsewhere.

Oil companies say they recognize the risk of investing in Venezuela, given the country’s abrupt shifts in the past. But they focus on the long-term potential of its petroleum reserves. Venezuela poses little risk in the search for oil since geologists have known for years where it lies in the Orinoco Belt.

Venezuela also differs from top oil nations like Saudi Arabia and Mexico, where national oil companies have monopolies. Petróleos de Venezuela let private companies remain as minority partners after the nationalizations, despite Mr. Chávez’s often aggressive anticapitalist stance.

Moreover, foreign oil services companies like Halliburton, which has done business in Venezuela for 70 years, have even expanded their activities in the country as Petróleos de Venezuela grew more dependent on contractors to help extract oil from aging wells.

Still, doubts persist over the chances that the new bids, which are set to conclude in June, will ultimately result in finished oil projects. Risks of operating here were underscored again last week when Venezuela ordered new production cuts along with other OPEC members, impacting ventures with private partners.

Under the current bidding rules, the onus for financing the new projects lies with the foreign companies, even though Petróleos de Venezuela would maintain control. Banks might balk at such a prospect. Distrust also lingers in dealing with Petróleos de Venezuela.

“An agreement on a piece of paper means nothing in Venezuela because of the way Chávez abruptly changes the rules of the game,” said a Venezuelan oil executive who has had dealings with oil companies from China, Russia and other countries.

“In 10 years, not one major oil project has been built in Venezuela,” said the oilman, who asked not to be identified for fear of retribution. “Chávez has left his so-called strategic partners out to dry, like the Chinese, who have been given the same treatment as Exxon.”

But the severity of the drop in oil prices may ultimately dictate the terms on which Venezuela re-engages with foreign oil companies.

“Chávez is celebrating the demise of capitalism as this international crisis unfolds,” said Pedro Mario Burelli, a former board member of Petróleos de Venezuela. “But the irony is that capitalism actually fed his system in times of plenty,” he said. “That is something Chávez will discover the hard way.”

María Eugenia Díaz and Thom Walker contributed reporting

María Eugenia Díaz and Thom Walker contributed reporting.

WASHINGTON — President Bush deflected a secret request by Israel last year for specialized bunker-busting bombs it wanted for an attack on Iran’s main nuclear complex and told the Israelis that he had authorized new covert action intended to sabotage Iran’s suspected effort to develop nuclear weapons, according to senior American and foreign officials.

White House officials never conclusively determined whether Israel had decided to go ahead with the strike before the United States protested, or whether Prime Minister Ehud Olmert of Israel was trying to goad the White House into more decisive action before Mr. Bush left office. But the Bush administration was particularly alarmed by an Israeli request to fly over Iraq to reach Iran’s major nuclear complex at Natanz, where the country’s only known uranium enrichment plant is located.

The White House denied that request outright, American officials said, and the Israelis backed off their plans, at least temporarily. But the tense exchanges also prompted the White House to step up intelligence-sharing with Israel and brief Israeli officials on new American efforts to subtly sabotage Iran’s nuclear infrastructure, a major covert program that Mr. Bush is about to hand off to President-elect Barack Obama.

This account of the expanded American covert program and the Bush administration’s efforts to dissuade Israel from an aerial attack on Iran emerged in interviews over the past 15 months with current and former American officials, outside experts, international nuclear inspectors and European and Israeli officials. None would speak on the record because of the great secrecy surrounding the intelligence developed on Iran.

Several details of the covert effort have been omitted from this account, at the request of senior United States intelligence and administration officials, to avoid harming continuing operations.

The interviews also suggest that while Mr. Bush was extensively briefed on options for an overt American attack on Iran’s facilities, he never instructed the Pentagon to move beyond contingency planning, even during the final year of his presidency, contrary to what some critics have suggested.

The interviews also indicate that Mr. Bush was convinced by top administration officials, led by Defense Secretary Robert M. Gates, that any overt attack on Iran would probably prove ineffective, lead to the expulsion of international inspectors and drive Iran’s nuclear effort further out of view. Mr. Bush and his aides also discussed the possibility that an airstrike could ignite a broad Middle East war in which America’s 140,000 troops in Iraq would inevitably become involved.

Instead, Mr. Bush embraced more intensive covert operations actions aimed at Iran, the interviews show, having concluded that the sanctions imposed by the United States and its allies were failing to slow the uranium enrichment efforts. Those covert operations, and the question of whether Israel will settle for something less than a conventional attack on Iran, pose immediate and wrenching decisions for Mr. Obama.

The covert American program, started in early 2008, includes renewed American efforts to penetrate Iran’s nuclear supply chain abroad, along with new efforts, some of them experimental, to undermine electrical systems, computer systems and other networks on which Iran relies. It is aimed at delaying the day that Iran can produce the weapons-grade fuel and designs it needs to produce a workable nuclear weapon.

Knowledge of the program has been closely held, yet inside the Bush administration some officials are skeptical about its chances of success, arguing that past efforts to undermine Iran’s nuclear program have been detected by the Iranians and have only delayed, not derailed, their drive to unlock the secrets of uranium enrichment.

Late last year, international inspectors estimated that Iran had 3,800 centrifuges spinning, but American intelligence officials now estimate that the figure is 4,000 to 5,000, enough to produce about one weapon’s worth of uranium every eight months or so.

While declining to be specific, one American official dismissed the latest covert operations against Iran as “science experiments.” One senior intelligence official argued that as Mr. Bush prepared to leave office, the Iranians were already so close to achieving a weapons capacity that they were unlikely to be stopped.

Others disagreed, making the point that the Israelis would not have been dissuaded from conducting an attack if they believed that the American effort was unlikely to prove effective.

Since his election on Nov. 4, Mr. Obama has been extensively briefed on the American actions in Iran, though his transition aides have refused to comment on the issue.

Early in his presidency, Mr. Obama must decide whether the covert actions begun by Mr. Bush are worth the risks of disrupting what he has pledged will be a more active diplomatic effort to engage with Iran.

Either course could carry risks for Mr. Obama. An inherited intelligence or military mission that went wrong could backfire, as happened to President Kennedy with the Bay of Pigs operation in Cuba. But a decision to pull back on operations aimed at Iran could leave Mr. Obama vulnerable to charges that he is allowing Iran to speed ahead toward a nuclear capacity, one that could change the contours of power in the Middle East.

An Intelligence Conflict

Israel’s effort to obtain the weapons, refueling capacity and permission to fly over Iraq for an attack on Iran grew out of its disbelief and anger at an American intelligence assessment completed in late 2007 that concluded that Iran had effectively suspended its development of nuclear weapons four years earlier.

That conclusion also stunned Mr. Bush’s national security team — and Mr. Bush himself, who was deeply suspicious of the conclusion, according to officials who discussed it with him.

The assessment, a National Intelligence Estimate, was based on a trove of Iranian reports obtained by penetrating Iran’s computer networks.

Those reports indicated that Iranian engineers had been ordered to halt development of a nuclear warhead in 2003, even while they continued to speed ahead in enriching uranium, the most difficult obstacle to building a weapon.

The “key judgments” of the National Intelligence Estimate, which were publicly released, emphasized the suspension of the weapons work.

The public version made only glancing reference to evidence described at great length in the 140-page classified version of the assessment: the suspicion that Iran had 10 or 15 other nuclear-related facilities, never opened to international inspectors, where enrichment activity, weapons work or the manufacturing of centrifuges might be taking place.

The Israelis responded angrily and rebutted the American report, providing American intelligence officials and Adm. Mike Mullen, the chairman of the Joint Chiefs of Staff, with evidence that they said indicated that the Iranians were still working on a weapon.

While the Americans were not convinced that the Iranian weapons development was continuing, the Israelis were not the only ones highly critical of the United States report. Secretary Gates, a former director of the Central Intelligence Agency, said the report had presented the evidence poorly, underemphasizing the importance of Iran’s enrichment activity and overemphasizing the suspension of a weapons-design effort that could easily be turned back on.

In an interview, Mr. Gates said that in his whole career he had never seen “an N.I.E. that had such an impact on U.S. diplomacy,” because “people figured, well, the military option is now off the table.”

Prime Minister Olmert came to the same conclusion. He had previously expected, according to several Americans and Israeli officials, that Mr. Bush would deal with Iran’s nuclear program before he left office. “Now,” said one American official who bore the brunt of Israel’s reaction, “they didn’t believe he would.”

Attack Planning

Early in 2008, the Israeli government signaled that it might be preparing to take matters into its own hands. In a series of meetings, Israeli officials asked Washington for a new generation of powerful bunker-busters, far more capable of blowing up a deep underground plant than anything in Israel’s arsenal of conventional weapons. They asked for refueling equipment that would allow their aircraft to reach Iran and return to Israel. And they asked for the right to fly over Iraq.

Mr. Bush deflected the first two requests, pushing the issue off, but “we said ‘hell no’ to the overflights,” one of his top aides said. At the White House and the Pentagon, there was widespread concern that a political uproar in Iraq about the use of its American-controlled airspace could result in the expulsion of American forces from the country.

The Israeli ambassador to the United States, Sallai Meridor, declined several requests over the past four weeks to be interviewed about Israel’s efforts to obtain the weapons from Washington, saying through aides that he was too busy.

Last June, the Israelis conducted an exercise over the Mediterranean Sea that appeared to be a dry run for an attack on the enrichment plant at Natanz. When the exercise was analyzed at the Pentagon, officials concluded that the distances flown almost exactly equaled the distance between Israel and the Iranian nuclear site.

“This really spooked a lot of people,” one White House official said. White House officials discussed the possibility that the Israelis would fly over Iraq without American permission. In that case, would the American military be ordered to shoot them down? If the United States did not interfere to stop an Israeli attack, would the Bush administration be accused of being complicit in it?

Admiral Mullen, traveling to Israel in early July on a previously scheduled trip, questioned Israeli officials about their intentions. His Israeli counterpart, Lt. Gen. Gabi Ashkenazi, argued that an aerial attack could set Iran’s program back by two or three years, according to officials familiar with the exchange. The American estimates at the time were far more conservative.

Yet by the time Admiral Mullen made his visit, Israeli officials appear to have concluded that without American help, they were not yet capable of hitting the site effectively enough to strike a decisive blow against the Iranian program.

The United States did give Israel one item on its shopping list: high-powered radar, called the X-Band, to detect any Iranian missile launchings. It was the only element in the Israeli request that could be used solely for defense, not offense.

Mr. Gates’s spokesman, Geoff Morrell, said last week that Mr. Gates — whom Mr. Obama is retaining as defense secretary — believed that “a potential strike on the Iranian facilities is not something that we or anyone else should be pursuing at this time.”

A New Covert Push

Throughout 2008, the Bush administration insisted that it had a plan to deal with the Iranians: applying overwhelming financial pressure that would persuade Tehran to abandon its nuclear program, as foreign enterprises like the French company Total pulled out of Iranian oil projects, European banks cut financing, and trade credits were squeezed.

But the Iranians were making uranium faster than the sanctions were making progress. As Mr. Bush realized that the sanctions he had pressed for were inadequate and his military options untenable, he turned to the C.I.A. His hope, several people involved in the program said, was to create some leverage against the Iranians, by setting back their nuclear program while sanctions continued and, more recently, oil prices dropped precipitously.

There were two specific objectives: to slow progress at Natanz and other known and suspected nuclear facilities, and keep the pressure on a little-known Iranian professor named Mohsen Fakrizadeh, a scientist described in classified portions of American intelligence reports as deeply involved in an effort to design a nuclear warhead for Iran.

Past American-led efforts aimed at Natanz had yielded little result. Several years ago, foreign intelligence services tinkered with individual power units that Iran bought in Turkey to drive its centrifuges, the floor-to-ceiling silvery tubes that spin at the speed of sound, enriching uranium for use in power stations or, with additional enrichment, nuclear weapons.

A number of centrifuges blew up, prompting public declarations of sabotage by Iranian officials. An engineer in Switzerland, who worked with the Pakistani nuclear black-marketeer Abdul Qadeer Khan, had been “turned” by American intelligence officials and helped them slip faulty technology into parts bought by the Iranians.

What Mr. Bush authorized, and informed a narrow group of Congressional leaders about, was a far broader effort, aimed at the entire industrial infrastructure that supports the Iranian nuclear program. Some of the efforts focused on ways to destabilize the centrifuges. The details are closely held, for obvious reasons, by American officials. One official, however, said, “It was not until the last year that they got really imaginative about what one could do to screw up the system.”

Then, he cautioned, “none of these are game-changers,” meaning that the efforts would not necessarily cripple the Iranian program. Others in the administration strongly disagree.

In the end, success or failure may come down to how much pressure can be brought to bear on Mr. Fakrizadeh, whom the 2007 National Intelligence Estimate identifies, in its classified sections, as the manager of Project 110 and Project 111. According to a presentation by the chief inspector of the International Atomic Energy Agency, those were the names for two Iranian efforts that appeared to be dedicated to designing a warhead and making it work with an Iranian missile. Iranian officials say the projects are a fiction, made up by the United States.

While the international agency readily concedes that the evidence about the two projects remains murky, one of the documents it briefly displayed at a meeting of the agency’s member countries in Vienna last year, from Mr. Fakrizadeh’s projects, showed the chronology of a missile launching, ending with a warhead exploding about 650 yards above ground — approximately the altitude from which the bomb dropped on Hiroshima was detonated.

The exact status of Mr. Fakrizadeh’s projects today is unclear. While the National Intelligence Estimate reported that activity on Projects 110 and 111 had been halted, the fear among intelligence agencies is that if the weapons design projects are turned back on, will they know?

David E. Sanger is the chief Washington correspondent for The New York Times. Reporting for this article was developed in the course of research for “The Inheritance: The World Obama Confronts and the Challenges to American Power,” to be published Tuesday by Harmony Books.

GOP Asked to Help Design Bill; $300 Billion in Tax Cuts Sought

By Paul Kane, Lori Montgomery and Shailagh Murray
Washington Post Staff Writers
Tuesday, January 6, 2009; A01

President-elect Barack Obama arrived on Capitol Hill yesterday and immediately set to work reassuring skeptical Republicans about his massive economic stimulus package — part of a campaign that earned him praise for seeking their input but questions from those averse to hundreds of billions of dollars in new spending.

Pitching a plan that is expected to include $300 billion in tax cuts, Obama pledged to consult Republican leaders, who until yesterday had been left out of negotiations between the president-elect’s advisers and congressional Democratic staff.

“The monopoly on good ideas does not belong to a single party. If it’s a good idea, we will consider it,” Obama told House and Senate leaders at an hour-long closed-door meeting, according to one attendee.

Obama, making his pitch two weeks before taking office, won generally favorable reviews from GOP leaders, particularly because of his decision to increase the tax-cut ratio to 40 percent of the overall package.

Senate Minority Leader Mitch McConnell (R-Ky.) and House Minority Leader John A. Boehner (R-Ohio) told reporters they were convinced that Obama was sincere in his invitation to let Republicans help craft the nearly $800 billion package to create jobs and lift the nation out of recession. But they also expressed concerns about the size of the package, as well as particular elements under discussion between Obama and Democratic lawmakers.

“I remain concerned about wasteful spending that might be attached to the tax relief. Simply put, we should not bury future generations under mountains of debt,” Boehner said.

Boehner suggested the legislation would likely be signed into law by mid-February, but the president-elect said yesterday that he would like the House and Senate to present him with a bill by the end of January or beginning of February.

“The economy is very sick,” Obama said. “The situation is getting worse. . . . We have to act and act now to break the momentum of this recession.”

As described by his advisers, Obama is proposing a package of tax cuts to benefit families and businesses. Like the overall spending proposal, the tax cuts would be designed to put cash in people’s pockets over the next two years and kick-start the economy.

Working families would be eligible for a tax credit worth up to $1,000. Individuals would be eligible for a $500 credit.

Businesses would get an extension of expired tax breaks from the 2008 stimulus package signed by President Bush, including a “bonus depreciation” break that allows businesses to write off more of their purchases more quickly and an increase in small-business expensing limits. Businesses could apply current losses to taxes paid back as far as five years ago, reaping an immediate cash windfall. And they would receive a $3,000 tax credit for every job they create or preserve.

Key details of the stimulus proposal remain unresolved. For instance, upper-income individuals would not be eligible for the income tax credit, but the income threshold for phasing out the benefit has not been set. Obama officials said it would likely be about $200,000 a year, the range set during the campaign.

Obama officials said they tried to keep the package ideologically neutral, rejecting an option supported by many progressives to make people who are not working eligible for a “refundable” tax credit. And they passed up conservative provisions such as estate tax relief and capital gains tax cuts that disproportionately benefit wealthier individuals.

After a lunchtime session with his economic advisers, Obama rejected suggestions that the tax cuts were designed to win over GOP votes. “The notion that me wanting to include relief for working families in this plan is somehow a political ploy, when this was a centerpiece of my plan for the last two years doesn’t make too much sense,” he told reporters.

Some prominent Republicans expressed reservations about the tax proposals’ specifics. Jon Kyl (Ariz.), a member of the Senate Republican leadership team, said he hadn’t studied the list of proposed cuts, but that he favored reducing corporate and capital gains taxes, and providing more generous small-business incentives. And, he said, “These changes should be permanent, rather than just temporary.”

Sen. Charles E. Grassley (Iowa), the senior Republican on the tax-writing Senate Finance Committee, said he would prefer a tax package that is “inclusive rather than exclusive” and that offers relief to “as many as taxpayers as possible.” One option, according to a senior Grassley aide, would be to include a $75 billion provision to prevent the alternative minimum tax from applying to millions of additional families.

It is also not clear that tax cuts are the most effective way to win GOP votes. Two key Republican moderates in the Senate — Susan Collins and Olympia J. Snowe, both of Maine — have not focused on tax breaks as the best solution to the economic crisis.

In a letter to Obama last month, Collins outlined her stimulus priorities as transportation construction projects, energy-efficiency investments and a temporary increase in Medicaid assistance to states. In conversations with Obama and his Treasury secretary-designate Timothy F. Geithner, Snowe has urged the inclusion of unemployment assistance, mortgage relief for strapped homeowners and programs to ease the credit crunch facing small businesses.

“With more than 10.3 million people currently out of work, Congress must swiftly enact economic recovery legislation that will create jobs, assist the unemployed and reduce the devastating rate of home foreclosures,” Snowe said.

Obama bounced across the Capitol yesterday to take part in three meetings, beginning with a one-on-one meeting with House Speaker Nancy Pelosi (D-Calif.) in the morning and a sit-down in the early afternoon with Senate Majority Leader Harry M. Reid (D-Nev.). The final meeting was with the bipartisan leadership from both chambers.

Democrats described the atmosphere as markedly different than the confrontational tone of recent battles with the Bush White House, in part because the new administration is run by former senators.

“They understand the Senate, they understand the Capitol. It wasn’t as if someone new was coming to town,” Sen. Richard J. Durbin (D-Ill.), the majority whip and close Obama ally, said afterward.

Some Republicans, while saying they were pleased by Obama’s attempt to open dialogue, questioned whether the spending side of the plan would be transparent enough. Rahm Emanuel, Obama’s chief of staff, pledged to put details of the spending plan online, including the creation of a monitoring system for the progress on some of the projects, according to one attendee.

Some independent analysts joined GOP aides in questioning Obama’s tax credit for job creation, saying it’s unclear how such a provision would be crafted.

“When somebody lays off 10,000 people but hires back 1,000, should they get a tax credit? That doesn’t really seem fair,” said Leonard Burman, a director of the Tax Policy Center, a joint project of the Urban Institute and the Brookings Institution. “The problem with these things is defining what qualifies.”

Meanwhile, some Republicans and moderate Democrats are pushing Obama to commit to addressing the nation’s long-term budget problems even as his stimulus package pushes the government deeper into debt. With congressional budget analysts expected to announce later this week that this year’s deficit is likely to soar well over $1 trillion, a commitment to reducing future deficits is critical, said Sen. Kent Conrad (D-N.D.), chairman of the Senate Budget Committee.

“At some point here, you have to pivot and face up to these long-term problems,” said Conrad, who along with Sen. Judd Gregg (R-N.H.) is proposing a commission to re-examine the expensive entitlement programs Social Security, Medicare and Medicaid.

BY BARRY RUBIN

Monday, January 5th 2009, 4:00 AM

The war in Gaza is the first chapter of a new era in the Middle East. The Arab-Israeli conflict is far from the region’s dominant dispute. The Arab-Islamist conflict now overwhelms it – by a large margin.

Increasingly, Arab regimes know Hamas isn’t their friend and, though they won’t say so publicly, don’t see Israel as an enemy. No wonder: Israel is politically stable and economically prosperous. It doesn’t threaten to take over their countries, overthrow their regimes and stand them in front of a firing squad.

Radical Islamism, Iran-style, does.

That’s right. Arab nations’ prime 21st century enemy is Iran and its allies: Syria, Hezbollah, Hamas and Iraqi terrorists. After destroying their own countries, they want to do the same to everyone else.

Up on the Lebanese border, where I just visited, things are quiet. Hezbollah talks big about its 2006 “victory” but knows how hard Israel hit it then. It’s not looking for trouble with the Jewish state now.

At the same time, Egypt condemns Hamas and urges Israel to smash the radical Islamist group. Lebanese friends tell me they fear that unless Israel and the West stop the Islamists, their country will be taken over in this new year.

The editor of the important Arabic newspaper Al-Sharq al-Awsat, himself a Saudi, warns that Iran and Hamas – effectively at war with Egypt and Saudi Arabia – are the real threat to Arab security.

And the meeting of Arab states last week, instead of producing a condemnation of Israel or America, did nothing.

What was the 2006 Israel-Hezbollah war’s big lesson? That unless Israel wins a clear victory, Islamists will be more aggressive. It’s the same thing the U.S. surge in Iraq demonstrates: pulling punches on terrorists doesn’t make them love you or be peaceable.

Of course, the Israel-Palestinian conflict is far from over: It will probably continue for decades. But that’s precisely the point. It’s an Israel-Palestinian battle, smaller and less strategically significant than this other half-century-long conflict, which involves the whole region.

This is also a conflict among Palestinians. The Palestinian Authority, which rules the West Bank, is still full of radicals but has worked recently to stop terrorist attacks against Israel and to create a stable society. The PA can’t and won’t make full peace with Israel, but the two sides do cooperate in reducing violence.

In contrast, Hamas wants permanent war on Israel, constant terrorism, and openly preaches genocide.

This is what the Obama administration must understand. The Arab-Israeli conflict is relatively unimportant today in regional terms. It is overwhelmed by a dangerous mix of other nations and issues: Iran, Iraq, Afghanistan, Pakistan, Lebanon (on the verge of an Iran-Syria takeover), Islamism, terrorism and oil.

Barack Obama must understand that Iran and radical Islamists are out to destroy U.S. interests in the Middle East, expand their own influence and escalate anti-Americanism to murderous proportions around the globe.

Moderate Arabs – and the nations in which they have the most influence – live in constant fear of that happening. America can allay those fears – if it follows a policy mixing intelligence and toughness.

Rather than obsessing over the Arab-Israeli conflict, as many want Obama to do, job one for the new administration in the Mideast should be uniting America’s Arab friends alongside Israel against their common enemies: the fanatical Islamists.

A broad moderate Arab coalition, strengthened to resist the likes of Iran, Hezbollah and Hamas, will not only put the region on far more solid footing. It will help the Israeli-Palestinian mess take care of itself.

Barry Rubin is director of the Global Research in International Affairs Center (GLORIA) and editor of the Middle East Review of International Affairs (MERIA) Journal. He is author of “The Long War for Freedom: The Arab Struggle for Democracy in the Middle East.”

January 5, 2009
Op-Ed Columnist

By PAUL KRUGMAN

“If we don’t act swiftly and boldly,” declared President-elect Barack Obama in his latest weekly address, “we could see a much deeper economic downturn that could lead to double-digit unemployment.” If you ask me, he was understating the case.

The fact is that recent economic numbers have been terrifying, not just in the United States but around the world. Manufacturing, in particular, is plunging everywhere. Banks aren’t lending; businesses and consumers aren’t spending. Let’s not mince words: This looks an awful lot like the beginning of a second Great Depression.

So will we “act swiftly and boldly” enough to stop that from happening? We’ll soon find out.

We weren’t supposed to find ourselves in this situation. For many years most economists believed that preventing another Great Depression would be easy. In 2003, Robert Lucas of the University of Chicago, in his presidential address to the American Economic Association, declared that the “central problem of depression-prevention has been solved, for all practical purposes, and has in fact been solved for many decades.”

Milton Friedman, in particular, persuaded many economists that the Federal Reserve could have stopped the Depression in its tracks simply by providing banks with more liquidity, which would have prevented a sharp fall in the money supply. Ben Bernanke, the Federal Reserve chairman, famously apologized to Friedman on his institution’s behalf: “You’re right. We did it. We’re very sorry. But thanks to you, we won’t do it again.”

It turns out, however, that preventing depressions isn’t that easy after all. Under Mr. Bernanke’s leadership, the Fed has been supplying liquidity like an engine crew trying to put out a five-alarm fire, and the money supply has been rising rapidly. Yet credit remains scarce, and the economy is still in free fall.

Friedman’s claim that monetary policy could have prevented the Great Depression was an attempt to refute the analysis of John Maynard Keynes, who argued that monetary policy is ineffective under depression conditions and that fiscal policy — large-scale deficit spending by the government — is needed to fight mass unemployment. The failure of monetary policy in the current crisis shows that Keynes had it right the first time. And Keynesian thinking lies behind Mr. Obama’s plans to rescue the economy.

But these plans may turn out to be a hard sell.

News reports say that Democrats hope to pass an economic plan with broad bipartisan support. Good luck with that.

In reality, the political posturing has already started, with Republican leaders setting up roadblocks to stimulus legislation while posing as the champions of careful Congressional deliberation — which is pretty rich considering their party’s behavior over the past eight years.

More broadly, after decades of declaring that government is the problem, not the solution, not to mention reviling both Keynesian economics and the New Deal, most Republicans aren’t going to accept the need for a big-spending, F.D.R.-type solution to the economic crisis.

The biggest problem facing the Obama plan, however, is likely to be the demand of many politicians for proof that the benefits of the proposed public spending justify its costs — a burden of proof never imposed on proposals for tax cuts.

This is a problem with which Keynes was familiar: giving money away, he pointed out, tends to be met with fewer objections than plans for public investment “which, because they are not wholly wasteful, tend to be judged on strict ‘business’ principles.” What gets lost in such discussions is the key argument for economic stimulus — namely, that under current conditions, a surge in public spending would employ Americans who would otherwise be unemployed and money that would otherwise be sitting idle, and put both to work producing something useful.

All of this leaves me concerned about the prospects for the Obama plan. I’m sure that Congress will pass a stimulus plan, but I worry that the plan may be delayed and/or downsized. And Mr. Obama is right: We really do need swift, bold action.

Here’s my nightmare scenario: It takes Congress months to pass a stimulus plan, and the legislation that actually emerges is too cautious. As a result, the economy plunges for most of 2009, and when the plan finally starts to kick in, it’s only enough to slow the descent, not stop it. Meanwhile, deflation is setting in, while businesses and consumers start to base their spending plans on the expectation of a permanently depressed economy — well, you can see where this is going.

So this is our moment of truth. Will we in fact do what’s necessary to prevent Great Depression II?

By Saeed Shah and Jonathan S. Landay / McClatchy

DECEMBER 27, 2008, 12:14 P.M. ET

NASHVILLE — Although the number of uninsured and the cost of coverage have ballooned under his watch, President Bush leaves office with a health care legacy in bricks and mortar: he has doubled federal financing for community health centers, enabling the creation or expansion of 1,297 clinics in medically underserved areas.

For those in poor urban neighborhoods and isolated rural areas, including Indian reservations, the clinics are often the only dependable providers of basic services like prenatal care, childhood immunizations, asthma treatments, cancer screenings and tests for sexually transmitted diseases.

As a crucial component of the health safety net, they are lauded as a cost-effective alternative to hospital emergency rooms, where the uninsured and underinsured often seek care.

Despite the clinics’ unprecedented growth, wide swaths of the country remain without access to affordable primary care. The recession has only magnified the need as hundreds of thousands of Americans have lost their employer-sponsored health insurance along with their jobs.

In response, Democrats on Capitol Hill are proposing even more significant increases, making the centers a likely feature of any health care deal struck by Congress and the Obama administration.

In Nashville, United Neighborhood Health Services, a 32-year-old community health center, has seen its federal financing rise to $4.2 million, from $1.8 million in 2001. That has allowed the organization to add eight clinics to its base of six, and to increase its pool of patients to nearly 25,000 from 10,000.

Still, says Mary Bufwack, the center’s chief executive, the clinics satisfy only a third of the demand in Nashville’s pockets of urban poverty and immigrant need.

One of the group’s recent grants helped open the Southside Family Clinic, which moved last year from a pair of public housing apartments to a gleaming new building on a once derelict corner.

As she completed a breathing treatment one recent afternoon, Willie Mai Ridley, a 68-year-old beautician, said she would have sought care for her bronchitis in a hospital emergency room were it not for the new clinic. Instead, she took a short drive, waited 15 minutes without an appointment and left without paying a dime; the clinic would bill her later for her Medicare co-payment of $18.88.

Ms. Ridley said she appreciated both the dignity and the affordability of her care. “This place is really very, very important to me,” she said, “because you can go and feel like you’re being treated like a person and get the same medical care you would get somewhere else and have to pay $200 to $300.”

As governor of Texas, Mr. Bush came to admire the missionary zeal and cost-efficiency of the not-for-profit community health centers, which qualify for federal operating grants by being located in designated underserved areas and treating patients regardless of their ability to pay. He pledged support for the program while campaigning for president in 2000 on a platform of “compassionate conservatism.”

In Mr. Bush’s first year in office, he proposed to open or expand 1,200 clinics over five years (mission accomplished) and to double the number of patients served (the increase has ended up closer to 60 percent). With the health centers now serving more than 16 million patients at 7,354 sites, the expansion has been the largest since the program’s origins in President Lyndon B. Johnson’s war on poverty, federal officials said.

“They’re an integral part of a health care system because they provide care for the low-income, for the newly arrived, and they take the pressure off of our hospital emergency rooms,” Mr. Bush said last year while touring a clinic in Omaha.

With federal encouragement, the centers have made a major push this decade to expand dental and mental health services, open on-site pharmacies, extend hours to nights and weekends and accommodate recent immigrants — legal and otherwise — by employing bilingual staff. More than a third of patients are now Hispanic, according to the National Association of Community Health Centers.

The centers now serve one of every three people who live in poverty and one of every eight without insurance. But a study released in August by the Government Accountability Office found that 43 percent of the country’s medically underserved areas lack a health center site. The National Association of Community Health Centers and the American Academy of Family Physicians estimated last year that 56 million people were “medically disenfranchised” because they lived in areas with inadequate primary care.

President-elect Barack Obama has said little about how the centers may fit into his plans to remake American health care. But he was a sponsor of a Senate bill in August that would quadruple federal spending on the program — to $8 billion from $2.1 billion — and increase incentives for medical students to choose primary care. His wife, Michelle, worked closely with health centers in Chicago as vice president for community and external relations at the University of Chicago Medical Center.

And Mr. Obama’s choice to become secretary of health and human services, former Senator Tom Daschle of South Dakota, argues in his recent book on health care that financing should be increased, describing the health centers as “a godsend.”

The federal program, which was first championed in Congress by Senator Edward M. Kennedy, Democrat of Massachusetts, has earned considerable bipartisan support. Leading advocates, like Senator Bernie Sanders, independent of Vermont, and Representative James E. Clyburn, Democrat of South Carolina, the House majority whip, argue that any success Mr. Obama has in reducing the number of uninsured will be meaningless if the newly insured cannot find medical homes. In Massachusetts, health centers have seen increased demand since the state began mandating health coverage two years ago.

At $8 billion, the Senate measure may be considered a relative bargain compared with the more than $100 billion needed for Mr. Obama’s proposal to subsidize coverage for the uninsured. If his plan runs into fiscal obstacles, a vast expansion of community health centers may again serve as a stopgap while universal coverage waits for flusher times.

Recent job losses, meanwhile, are stoking demand for the clinics’ services, often from first-time users. The United Neighborhood Health Services clinics in Nashville have seen a 35 percent increase in patients this year, with much of the growth from the newly jobless.

“I’m seeing a lot of professionals that no longer have their insurance or they’re laid off from their jobs,” said Dr. Marshelya D. Wilson, a physician at the center’s Cayce clinic. “So they come here and get their health care.”

Studies have generally shown that the health centers — which must be governed by patient-dominated boards — are effective at reducing racial and ethnic disparities in medical treatment and save substantial sums by keeping patients out of hospitals. Their trade association estimates that they save the health care system $17.6 billion a year, and that an equivalent amount could be saved if avoidable emergency room visits were diverted to clinics. Some centers, including here in Nashville, have brokered agreements with hospitals to do exactly that.

Many centers are finding that federal support is not keeping pace with the growing cost of treating the uninsured. Government grants now account for 19 percent of community health center revenues, compared with 22 percent in 2001, according to the Health Resources and Services Administration, which oversees the program. The largest revenue sources are public insurance plans like Medicaid, Medicare and the State Children’s Health Insurance Program, making the centers vulnerable to government belt-tightening.

The centers are known for their efficiency. Though United Neighborhood Health Services has more than doubled in size this decade, Ms. Bufwack, its chief executive, manages to run five neighborhood clinics, five school clinics, a homeless clinic, two mobile clinics and a rural clinic, with 24,391 patients, on a budget of $8.1 million. Starting pay for her doctors is $120,000. Patients are charged on an income-based sliding scale, and the uninsured are expected to pay at least $20 for an office visit. One clinic is housed in a double-wide trailer.

Because of a nationwide shortage of primary care physicians, the clinics rely on federal programs like the National Health Service Corps that entice medical students with grants and loan write-offs in exchange for agreements to practice as generalists in underserved areas. Of the 16 doctors working for United Neighborhood, seven are current or former participants.

Dr. LaTonya D. Knott, 37, who treated Ms. Ridley for her bronchitis, is among them. Born to a 15-year-old mother in south Nashville, she herself had been a regular childhood patient at one of the center’s clinics. After graduating as her high school’s valedictorian, she went to college on scholarships and then to medical school on government grants, with an obligation to serve for two years.

She said she now felt a responsibility to be a role model. “I do a whole lot of social work,” she said, noting that it was not uncommon for children to drop by the clinic for help with homework, or for a peanut butter sandwich. “It’s not just that we provide the medical care. I’m trying to provide you with a future.”

Despite such commitment, national staffing shortages have reinforced concerns about the quality of care at health centers, notably the management of chronic diseases. This year, the government started collecting data at the centers on performance measures like cervical cancer screening and diabetes control.

“The question is not just, ‘Are you going to have more community health centers?’ ” said Dr. H. Jack Geiger, founder of the health centers movement and a professor emeritus at the City University of New York. “It’s, ‘Are you going to have adequate services?’ ”

A deeper frustration for health centers concerns their difficulty in securing follow-up appointments with specialists for patients who are uninsured or have Medicaid. All too often, said Ms. Bufwack, medical care ends at the clinic door, reinforcing the need to expand both primary care and health insurance coverage.

“That’s when our doctors feel they’re practicing third world medicine,” she said. “You will die if you have cancer or a heart condition or bad asthma or horrible diabetes. If you need a specialist and specialty tests and specialty meds and specialty surgery, those things are totally out of your reach.”

Current wisdom has it that if there had been a few less hanging chads in Florida in November 2000, the world would be a different place.

Al Gore would have won the presidency, the Iraq war wouldn’t have happened, and several hundred thousand people who perished in that war would be alive today. That conclusion is based on the generally unchallenged belief that Iraq is George W. Bush’s war: that he and a cabal of like-minded right-wingers conceived and executed the invasion for their own ideological motives. Or, as Frank Harvey, a research professor of international relations at Dalhousie University, puts it: “A few powerful ideologues exploited public fears (and international goodwill) in the aftermath of 9/11 to amplify Iraq’s WMD threat as a primary justification for an unnecessary, preventive invasion.”

That view, notes Harvey, “has emerged as the dominant narrative for explaining the U.S. attack. It represents the prevailing consensus running through dozens of the most popular books on the Bush administration, and hundreds of frequently cited (and widely circulated) scholarly articles, media reports and blog entries on the invasion. In fact, casual observers engaged in a cursory review of the literature will find the same thesis repeated (and usually defended) by prominent scholars, journalists and Washington ‘insiders’ on the left and right of the political spectrum.”

Harvey believes the conclusion is dead wrong. In a new paper for the Canadian Defense and Foreign Affairs Institute, he deconstructs the thesis and finds it “overlooks almost all of the relevant historical facts.” More than that, he asks a simple question: Had he been elected, would Al Gore have taken the same path as George Bush? He concludes, overwhelmingly, that he would have. (more…)

December 22, 2008

By Ed Gillespie

As the year draws to an end and President Bush enters his final month in office, there is much commentary about the Administration’s record over the past eight years. Unsurprisingly, many of these stories assail and distort the President’s record and recycle myths and unfounded allegations that have been leveled for the better part of his two terms. Historical accuracy requires a response to the litany of attacks leveled against President Bush, and while there’s not enough space to respond to all of them, here are five of the most egregious:

Myth 1: The last eight years were awful for most Americans economically and President Bush’s deregulatory policies caused the current financial crisis.

Reality:

President Bush’s time in office is ending as it began, with our economy under stress. The recession President Bush inherited as he entered office ran through the attacks of September 11, 2001, but during the recovery that followed, and due in no small part to the tax relief President Bush worked with Congress to provide, this country experienced its longest run of uninterrupted job growth – 52 straight months, with 8.3 million jobs created.

This reflected six consecutive years of economic growth from the Fourth Quarter of 2001 until the Fourth Quarter of 2007. From 2000 to 2007, real GDP grew by more than 17 percent, a remarkable gain of nearly 2.1 trillion dollars. This growth was driven in part by increased labor productivity gains that have averaged 2.5 percent annually since 2001, a rate that exceeds the averages of the 1970s, ’80s, and ’90s. In the same period, real after-tax income per capita increased by more than 11 percent, and there was a 4.7 percent increase in the number of new businesses formed. The current economic challenges, which the President and his Administration have responded to aggressively, threaten to reverse some of these gains – but the gains cannot be denied.

As for the current crisis, the President and his economic team have taken unprecedented actions to stabilize the financial sector and avert a collapse. While there are a number of causes of the housing and credit crises that are at the root of our current economic troubles, deregulation by the Bush Administration is simply not one of them. In fact, one of the circumstances that contributed to the crisis was the failure of the government sponsored enterprises (GSEs) Fannie Mae and Freddie Mac, which President Bush long tried to subject to greater regulation. In April 2001, three months after taking office, the President warned in his first budget that the size of the two GSEs were a “potential problem” that “could cause strong repercussions in financial markets, affecting Federally insured entities and economic activity.” In 2003, the Administration began calling for a new GSE regulator, and over the next five years, the Administration continued to call for GSE reform only to be accused by Democrats in Congress of creating artificial fears and advocating for ill-advised proposals. By the time Congress finally acted in 2008 to provide the oversight the President requested, it was too late to prevent systemic consequences. Had the Administration’s initial reform proposals been adopted, some of today’s turmoil in our financial markets may have been averted.

Myth 2: President Bush’s tax cuts only benefitted the wealthy and were paid for by sacrificing investments in health care and education.

Reality:

There are not 116 million “wealthy Americans,” but that’s how many taxpayers benefited from the President’s tax relief. The across-the-board tax cuts provided tax relief to every American who pays income taxes, created a new bottom 10 percent bracket rate, doubled the child tax credit to $1,000, and actually increased the share of the Federal income tax burden paid by the top 10 percent of individual earners from 67 percent in 2000 to 70 percent in 2005. Furthermore, this Administration removed 13 million low-income earners from the income tax rolls completely.

The economic growth spurred by tax relief also spurred growth in Federal tax receipts. In fact, the Federal Treasury realized the largest three-year increase of revenue in 26 years, and tax receipts grew more than $542 billion between 2000 and 2007. And yes, much of that money went to investments in health care and education.

President Bush provided more than 40 million Americans with better access to prescription drugs by creating the market-based Medicare Prescription Drug Benefit. And it is one of the rare government programs that actually costs less than expected. Projected overall program spending between 2004 and 2013 is approximately $240 billion lower, nearly 38 percent, than originally estimated, thanks to the market-oriented principles included at President Bush’s insistence.

Despite the heated rhetoric over children’s health insurance (S-CHIP) legislation last year, estimates from a 2007 Federal survey show that the number of uninsured children under the age of 18 actually declined by 800,000 from 2001 to 2007. From 2007 to 2008, the number of people covered by affordable and portable Health Savings Account-eligible plans increased 35 percent. Additionally, since President Bush took office, more than 1,200 community health centers have opened or expanded nationwide, which has helped provide treatment to nearly 17 million people.

Federal spending on education has increased nearly 40 percent under President Bush. Additionally, Pell Grant funding nearly doubled during the Administration, which is expected to help more than 5.5 million students attend college in the 2008-09 school year, 1.2 million more students than were assisted by Pell Grants in the 2001-02 school year. This financial aid assistance also helps account for the fact that 66 percent of high school graduates from the class of 2006 enrolled in colleges, compared to 63 percent in 2000.

Perhaps more importantly, the President’s No Child Left Behind Act has delivered tangible results to students. Since the law was enacted, fourth-grade students have achieved their highest reading and math scores on record, eighth-grade students have achieved their highest math scores on record, and African-American and Hispanic students have posted all-time high scores in a number of categories, narrowing the gap between minority students and white students.

Myth 3: The President’s “go it alone” foreign policy ruined America’s standing in the world.

Reality:

Rarely can one see revisionist history occurring in the present, but this charge is nothing short of that. The United States acted with a multilateral coalition of partner nations to remove Saddam Hussein from power in Iraq after he failed to comply with the will of the international community, including numerous United Nations Security Council Resolutions. To ignore this fact is not only a distortion of history, but it is also an insult to the service members of our coalition partners who sacrificed their lives to contribute to the success we are now witnessing in Iraq. And in Afghanistan, approximately forty countries are currently deployed with American forces, including every one of our NATO allies.

The President also created a worldwide coalition of more than 90 nations to combat terrorist networks by sharing information, drying up their financing, and bringing their leaders to justice. To date, we have captured or killed hundreds of al-Qaeda leaders and operatives with the help of partner nations. Furthermore, the Administration established the Proliferation Security Initiative, which now includes more than 90 nations, and other multilateral coalitions to stop the proliferation of weapons of mass destruction.

The President successfully pushed for expanding NATO membership, generated international pressure on Iran to stop it from developing nuclear weapons, and organized the Six-Party Talks, which have resulted in North Korea committing to give up its nuclear weapons and abandon its nuclear programs. Verifying North Korea’s commitment will be a challenge, but at the most recent Six-Party Talks meeting, there was strong consensus among the five parties that North Korea must submit to a comprehensive verification regime that accords with international standards.

U.S. ties in Asia have been strengthened over the past eight years, and the Administration has built strong relationships with China, Japan, and South Korea, among others. We have signed an historic civilian nuclear power agreement with India, reflecting a fundamental change in our relationship. Pro-American leaders have been elected in Germany, France, and Italy. Eastern European countries such as Georgia, Ukraine, and Kosovo treasure their relationships with the United States, and no president has done more to improve health and security in the nations of Africa. We have also strengthened cooperation with Latin America, including initiatives with Brazil on biofuels and with Mexico and Central America on fighting organized crime. Finally, when the President took office, America had trade agreements in force with only three countries, versus 14 today – with three additional agreements approved by Congress but not yet in force and agreements with three countries that are awaiting Congressional approval.

Myth 4: The war in Iraq caused us to “take our eye off the ball” in Afghanistan and with al Qaeda.

Reality:

Iraq and Afghanistan are two fronts in the same war, and while the success of the surge in Iraq has been visible, we have also had a quiet surge in Afghanistan. The U.S. has continuously and aggressively fought side-by-side with Afghans and our allies to defeat the Taliban and al Qaeda in Afghanistan. The United States has provided nearly $32 billion for security, political, and economic development assistance and the international community has provided more than $55 billion to Afghanistan since 2001.

An additional U.S. Marine battalion deployed to Afghanistan in November and they will be followed by an Army combat brigade of about 3,400 troops in early 2009. U.S. forces now total approximately 31,000, and are joined by nearly as many coalition troops. The United States and our allies are working with Afghanistan to help it nearly double the size of the Afghan National Army over the next five years, from 79,000 now trained to 134,000 in 2014.

We have also deployed Provincial Reconstruction Teams to ensure security gains are followed by real improvements in daily life, and we have helped local communities strengthen their economies and create jobs, deliver basic services, improve governance and fight corruption, and build or repair key infrastructure such as roads, bridges, hospitals, and schools. More than six million children, approximately two million of them girls, are now in Afghan schools, compared to fewer than one million in 2001.

In this Global War on Terror, we do not have the luxury to fight on one battlefront at a time. To defeat the terrorists, we must fight them overseas so we don’t have to fight them here at home. Since 9/11, we have successfully captured or killed dozens of al-Qaeda’s senior leadership and hundreds of al-Qaeda operatives in two dozen countries, removed al-Qaeda’s safe-haven in Afghanistan and crippled al-Qaeda in Iraq, and disrupted numerous al Qaeda terrorist plots against the U.S., including a 2006 plot to blow up passenger planes traveling from London.

Myth 5: This Administration has been bad for the environment and ignored the problem of global warming.

Reality:

Given the liberal media’s failure to acknowledge this Administration’s true record on alternative energy, conservation, and climate change, it’s not surprising this charge has stuck. But here are some irrefutable data points: From 2001 to 2007, air pollution decreased by 12 percent, and fine particulate matter pollution is down 17 percent since 2001. Ethanol production quadrupled from 1.6 billion gallons in 2000 to 6.5 billion gallons in 2007, wind energy production has increased by more than 400 percent, and solar energy capacity has doubled. In 2007, solar installations increased more than 32 percent and the U.S. produced 96 percent more biodiesel (490 million gallons) than in 2006. The Administration also provided nearly $18 billion to research, develop, and promote alternative and more efficient energy technologies such as biofuels, solar, wind, clean coal, nuclear, and hydrogen.

This Administration has improved and protected the health of more than 27 million acres of Federal forest and grasslands, protected, restored, and improved more than three million acres of wetlands, and established the Papahānaumokuākea Marine National Monument, the world’s largest fully protected marine conservation area (nearly 140,000 square miles).

Much of the misperception about the President’s environmental record is born out of the President’s withdrawing the United States from the Kyoto Protocol, which did not include the effective participation of major developing countries such as India and China. Instead, the President worked to address climate change by launching the Major Economies Process, which convened the leaders of the world’s major economies, both developed and developing, to work on ways to further reduce greenhouse gas emissions and improve energy security without harming our economies or giving any nation a free ride. Finally, the President set the country on course to stop the growth of greenhouse gas emissions below projected levels by 2025 and invested more than $44 billion in climate change-related programs.

Some other items that are infrequently mentioned about the real record of the Bush Administration but are worth noting: Teenage drug use has declined 25 percent; in 2007, the violent crime rate was 43 percent lower than the rate in 1998; between 2005 and 2007, the chronically homeless population decreased approximately 30 percent; funding for veterans’ medical care has increased more than 115 percent; and as of 2005, the most recent abortion rate is at its lowest since 1974.

And one last fact: Our homeland has not suffered another terrorist attack since September 11, 2001. That, too, is part of the real Bush record.

More on RCP: Gas Prices Shouldn’t Set Our Energy Policy

Page Printed from: http://www.realclearpolitics.com/articles/2008/12/myths_and_facts_about_the_real.html at December 22, 2008 – 04:44:29 AM

By James V. Grimaldi and Philip Rucker
Washington Post Staff Writers
Friday, December 19, 2008; A01

Former president Bill Clinton’s disclosure yesterday that foreign governments and state-sponsored agencies have donated between $75 million and $165 million to his foundation highlighted a series of potential conflicts that Hillary Rodham Clinton could face should she become secretary of state.

The kingdom of Saudi Arabia made one of the largest contributions, between $10 million and $25 million, as did the Australian government’s overseas aid program and a Dominican Republic agency that fights AIDS. The William J. Clinton Foundation also raised more than $1 million each from the governments of Brunei, Kuwait, Oman and Qatar.

The former president had resisted releasing the list of donors during his wife’s presidential campaign, but he agreed to do so when it became a possible issue as President-elect Barack Obama was considering whether to make her part of his Cabinet.

The list — containing more than 200,000 donor names — shows the extent to which Bill Clinton relied on foreign governments, especially those of Middle Eastern oil states, to establish his foundation over the past decade. In many cases, those governments have national interests that have routinely come before the State Department and other U.S. government agencies.

Obama transition officials believe Clinton’s disclosure “goes above and beyond in preventing conflicts,” spokesman Tommy Vietor said. “Past donations to the Clinton Foundation have no connection to Senator Clinton’s prospective tenure as secretary of state. Going forward, all donors will be disclosed on an annual basis, and new donations from foreign governments will be scrutinized by government ethics officers.”

The release of the Clinton donors shows for the first time the scope of his international fundraising and charitable efforts since leaving the White House in 2001. Norway and the national charitable lottery of the Netherlands gave more than $5 million, for example, and the Swedish lottery also donated. The Jamaican and Italian governments each contributed more than $50,000.

“It is going to be complex to disassociate the specialized interests of the foundation of Bill Clinton from certain foreign interests that are represented by the U.S. government,” said James Thurber of American University’s Center for Congressional and Presidential Studies. “But I think they can do it. I don’t think it is a major issue yet, but you never know, when it comes to Bill Clinton, what might come out.”

Since it was established in 1997, the Clinton Foundation has raised more than $500 million, which has financed construction of Clinton’s presidential library in Little Rock as well as charitable programs in global health, poverty, climate change and education. The donations have gone to an estimated 150 countries and provided medication to some 1.4 million people living with AIDS, according to foundation staff. In partnership with former president George H.W. Bush, the foundation also raised millions of dollars for recovery efforts along the Gulf Coast after Hurricane Katrina.

The list released yesterday includes some controversial figures and companies. Affiliates of the Korean conglomerate Hanwha — Hanwha L&C, Hanwha Engineering and Construction, and Hanwha Stores — donated about $1 million after Clinton traveled to Seoul in 2003 and appeared with Hanwha Group Chairman Kim Seung-youn. Kim has been charged and jailed in Korea on public corruption allegations.

Another donation followed Clinton’s trip to Kazakhstan in 2005 on the private jet of Frank Giustra, a financier of mining ventures. On the trip, Clinton praised Kazakhstan’s authoritarian president, and Giustra later entered into agreements to invest in uranium projects controlled by Kazakhstan’s government. Giustra donated $10 million to $25 million, and the Clinton Giustra Sustainable Growth Initiative gave between $1 million and $5 million.

A donation of more than $25,000 came from Andre Agapov, a Russian mining company owner who allegedly worked with the Russian secret police for President Boris Yeltsin.

Other contributors include Friends of Saudi Arabia and the Dubai Foundation, as well as Saudi businessman Nasser Al-Rashid, each giving more than $1 million. Haim Saban, the Egyptian-born media tycoon who funds many Israeli initiatives, gave more than $5 million.

Among the top donors were foundations created by Microsoft founder Bill Gates and his wife, Melinda Gates, and Scottish retail-clothing executive Tom Hunter. Also on the list of the biggest contributors, giving between $10 million and $25 million each, are real estate and Hollywood mogul Stephen L. Bing, New York billionaire B. Thomas Golisano, Gateway computer co-founder Theodore W. Waitt and Chicago media executive Fred Eychaner. Black Entertainment Television founder Robert L. Johnson gave more than $1 million.

Billionaire financier and political supporter George Soros and his Open Society Institute each gave major donations, while the Arkansas-based foundations linked to retail giant Wal-Mart each gave at least $1 million.

The list also includes gifts from companies damaged in the current economic meltdown, such as Lehman Brothers, Citigroup, Freddie Mac and General Motors.

Entertainment figures on the list include producer Steven Spielberg, actors Cameron Diaz and the late Paul Newman, and singers Barbra Streisand and Carly Simon. New York Yankees owner George Steinbrenner and Formula One driver Michael Schumacher also donated.

“I want to personally express my deepest appreciation to our many contributors, who remain steadfast partners in our work to impact the lives of so many around the world in measurable and meaningful ways,” Bill Clinton said in a statement. “We have just begun — and it is an honor and privilege to be on this journey alongside each and every person who is committed to our foundation’s ongoing charitable mission.”

The foundation did not release the exact amounts or dates for donations, but it did include donors who gave very small amounts, going beyond the normal requirements for federal campaign disclosures. The donors were classified by amount of their gifts, within ranges.

Clinton released more detail than that promised by President Bush, who has said he does not plan to release names of donors, or George H.W. Bush, who also received contributions of at least $1 million from Oman, Saudi Arabia and the United Arab Emirates. The elder Bush also collected more than $50,000 from Japan, Hong Kong and Thailand.

Former president Jimmy Carter’s center, which was a model for Clinton’s, releases the names of $1 million-plus donors, and they include foreign governments as well.

Research editor Alice Crites, database editor Sarah Cohen, and staff writers Matthew Mosk, Dan Morgan, Steven Mufson, Derek Kravitz and Mary Pat Flaherty contributed to this report.

This article is by David E. Sanger, Bill Vlasic and Micheline Maynard.

WASHINGTON — The White House raised for the first time on Thursday the prospect of forcing General Motors and Chrysler into a managed bankruptcy as a solution to save the companies from financial collapse.

The White House announced early on Friday that President Bush would make a statement at 9 a.m. Eastern time about efforts to negotiate a bailout for the domestic auto industry.

On Thursday, his spokeswoman, Dana Perino, confirmed growing speculation within legal circles that the president and Treasury Secretary Henry M. Paulson Jr. were considering the step.

“There’s an orderly way to do bankruptcies that provides for more of a soft landing,” Ms. Perino said. “I think that’s what we would be talking about. That would be one of the options.”

A senior administration official, however, later described that option as a last resort, to be used only if an agreement for a voluntary overhaul of the industry could not be reached.

These officials said the preferred solution would be to force a restructuring of the industry outside of bankruptcy court, extracting concessions that would make the companies more cost-competitive with foreign automakers.

In return, the Treasury would tap the financial rescue fund, called the Troubled Asset Relief Program, to make loans to the companies.

After a week of talks between the automakers and the Treasury Department over the terms of a possible bailout, Ms. Perino on Thursday said, “we’re very close.”

President Bush, speaking on Thursday at the American Enterprise Institute, an organization dedicated to free market principles, said that he had determined that the economy was too fragile to allow G.M. and Chrysler to fail. The companies have warned that will happen if they do not receive financial aid soon.

In his speech Thursday, Mr. Bush made clear that he wanted to avoid a “disorderly bankruptcy” because of “what it would do to the psychology of the markets.” But he also said he was “worried about putting good money after bad,” and suggested he would only approve a plan that allowed the auto companies to “become