Monday, June 18, 2012

Quick Hits - June 18, 2012

Breaking News - Former Major League pitching star, Roger Clemens, was found not guilty of perjury and all other charges related to prosecutors allegation that he lied about steroid use.

Today, we assess and see the effects of the major elections in Egypt, Greece, and France that took place over this past weekend.

EGYPT - the Egyptian elections featured what appeared to be a surprisingly low turnout over the 2 day Presidential run-off election between the Muslim Brotherhood candidate and a candidate who was the former Prime Minister in the regime of President Mubarak.  Both candidates have claimed victory in the election, but final results from tallying the votes is not expected to be available until Thursday.  Early info and expectations appear to reflect a win by the Muslim Brotherhood candidate.

If this is the case, what does this mean for Egypt?  If we recall, late last week Egypt's highest court ordered Parliament dissolved because of problems with the process that elected a strong Muslim / jihadist majority in Parliament.  Over the weekend, the Egyptian military, which is the current Egyptian government, issued a constitutional decree that weakened the role of the President and makes the armed forces effectively unaccountable to an elected President.

The military leadership today worked to downplay this announcement, indicating that they would still turn over the reins of the government to the newly elected President before the end of this month, as promised.  But this could also be the case of the military deciding to hold onto power to prevent the Muslim Brotherhood from gaining greater sway over Egypt.

Continuing with the 'official' US policy of the Obama Administration of supporting the Muslim Brotherhood in Egypt, the US State Department 'sharpened its criticism of Egypt's ruling military council'.  This prompts the question that if the Egyptian military has serious concerns with the Muslim Brotherhood possibly taking over the country, shouldn't we have similar concerns given the past history of the Muslim Brotherhood?

Oh, that's right - last year according to Director of National Intelligence, James Clapper, the Muslim Brotherhood is a 'largely secular' group that just happens to support the establishment of Shari'a law and the use of jihad to spread Islam.

Highlighting the regional impact of this election, the AP is reporting that tensions and violence are increasing along the Sinai border with Israel....
Militants crossed from Egypt's turbulent Sinai Peninsula into southern Israel on Monday and opened fire on civilians building a border security fence, defense officials said. One of the Israeli workers was killed, and two assailants died in a gunbattle with Israeli troops responding to the attack.

No group claimed responsibility for the attack, which underscored the growing lawlessness in the Sinai desert since longtime Egyptian President Hosni Mubarak was toppled by a popular uprising last year.

Military spokeswoman Lt. Col Avital Leibovich said the assailants have not been identified but acknowledged that defense officials suspected Palestinian militants in the Hamas-run Gaza Strip, which also borders the Sinai desert in that same area, might have been involved.
The current Greek election is done, but the Eurocrisis is far from done.

As noted in yesterday's QH, the New Democrat Party won the majority of votes cast and with the 50 bonus seats in Parliament that the winner gets, has 129 seats.  This is short of the 151 seats needed for a clean majority.  So, it falls to the leadership of the New Democrat Party to form a coalition government with the other parties within 3 days.  If the New Democrat Party is unable to form a coalition government, it falls to the hard left anti-austerity Syriza party to try to form a coalition.

The early assumption was that the New Democrat Party and Pasok would form a coalition - comprising of 162 seats in the Parliament.  This was turned on its ear last night when the leader of Pasok wanted the 2nd place party, Syriza, to be part of the coalition.  The challenge is that while the New Democrat Party and Pasok support the austerity and other terms of the current bailout, Syriza strongly opposes those terms and has demanded that the bailout deal be re-negotiated.

One option is for both the New Democrat Party and Pasok to join with Syriza to demand that Germany and the troika of the EU, ECB, and IMF accept a revision of Greece's bailout obligations - perhaps adding 2 years to the compliance time.  This many entice Syriza to join a coalition that would comprise the three largest vote getting parties.

However, since Syriza did gain substantially in support between the May 6 and June 17 election, it may be that the party leader, Alex Tsipras would prefer to remain outside the coalition government to be able to snipe at the government and seek to capitalize on the next election (within 2 months if a government cannot be formed now) to propel his party to the top vote getting position.

Europe is now watching these internal issues being fought out within Greek politics.  While there was initial relief with the victory of the New Democrats Party over Syriza, the markets and EU leadership is now waiting to see which shoe drops next....
Although the Samaras victory has been met with huge relief across EU capitals, the New Democracy leader is viewed warily by European policy-makers because of his past record as a populist tub-thumper against the bailout conditions. Senior sources in Brussels said there was a good chance the likely prime minister would show up in Brussels to take part in a meeting of eurozone finance ministers which will grapple with the Greek fallout and how to reinforce the Greek rescue.

The Pasok leader and former prime minister and finance minister, Evangelos Venizelos, is also not seen as fully trustworthy.
On top of the concerns over all involved in trying to form a new Greek government, the other shoe is the fact that Greece is expected to ask for a THIRD bailout to prevent it's insolvency as soon as a new government is formed. This would come just 4 months after Greece received its second bailout - and ramps up pressure on Germany and the troika to either grant the bailout or see Greece collapse out of the Eurozone.

With all of this posturing, what is clear is the answer of Germany to the main questions. Nein! [No] NO to a third bailout; no to revising the existing austerity requirements of the second bailout; and that Germany fully expects the quick formation of a new and stable Greek government that will honor its obligations to the troika.

Spain didn't have new elections, but the country's troubles are increasing as the yields for Spanish bonds surged higher again today - reaching an all-time high of 7.17% and increasing fears that Spain will need a sovereign bailout on top of the $126 billion it just received for its troubled banks.

Greece, Portugal, and Ireland were forced to seek sovereign debt bailouts when their government bond yields breached the 7% level.  The challenge with Spain is that its economy is 6 times the size of Greece's and the EU lacks sufficient rescue funds for Spain.  Oh, and Italy, it's bond yields are also increasing - yet still short of that 7% level.  If Italy joins the nations needing a bailout....

Also as noted yesterday, France elected a strong socialist majority to the French parliament to help enact the tax and spend entitlement state / Keynesian / Socialism vision of President Francois Hollande.

One person who is likely to be strongly supporting Francois Hollande is one of Barack Obama's former Harvard Law professors, Roberto Ungo.  

One of President Obama's former Harvard professors is calling for the president's defeat in November, releasing a scathing video in which he accuses the president of abandoning America's workers while pushing a policy of "food stamps."
The video by Brazilian scholar and politician Roberto Unger serves as an indictment of both parties. But in it, Unger says Obama must be defeated in order for the Democratic Party to restore itself "as the vehicle for the progressive alternative in the country."

Obama, he said, has not advanced that cause.

"President Obama must be defeated in the coming election. He has failed to advance the progressive cause in the United States," he said in the eight-minute video, titled "Beyond Obama” posted on You Tube…
I suspect that many in the President's hard left progressive base are feeling the same - and this is reflected in the less than expected campaign fundraising support and enthusiasm for the President.

But the President also didn't get a lot of love from the G-20 during today's meetings in Mexico.  One of the key pillars of the President's 2008 'Hope and Change' campaign was to reverse the 'dislike' that much of the world had towards the United States that occurred during the Bush Administration.  But is this the change that the President had in mind as the EU President lays the full blame of the Eurocrisis on the US and American capitalism...
The opening day of the G20 summit was threatening to deteriorate into a fractious row between eurozone countries and other non-European members of the G20, notably the US, as EU commission president José Manuel Barroso insisted the origins of the eurozone crisis lay in the unorthodox policies of American capitalism.

As Europe's leaders came under intense pressure to act decisively to cure the euro's ills, and a campaign gathered pace to relax some of the austerity programmes laying waste to countries burdened with unsustainable debt levels, Barroso insisted that Europe had not come to the G20 summit in Mexico to receive lessons on how to handle the economy.

When asked by a Canadian journalist "why should North Americans risk their assets to help Europe?" he replied: "Frankly, we are not here to receive lessons in terms of democracy or in terms of how to handle the economy.

"By the way this crisis was not originated in Europe … seeing as you mention North America, this crisis originated in North America and much of our financial sector was contaminated by, how can I put it, unorthodox practices, from some sectors of the financial market."
It's pretty hard to not find examples of the feckless mainstream media's bias if one spends time reading through some of the main elements of the MSM.  One of these comes from the Associated Press which was reporting on the terrorist bombings yesterday on three Christian churches in northern Nigeria.  As I mentioned in my report on the bombings, this predominately Muslim part of Nigeria has seen a number of bombings against Christian churches and churchgoers by the radical Islamist terrorist organization Boko Haram.  But in it's reports, it takes the AP 9 paragraphs before it mentions that Islamist terrorists were responsible for the bombings.
A radical Islamist sect on Monday claimed responsibility for Sunday's suicide attacks at two churches in the city of Zaria and another in the city of Kaduna that left 21 people dead, according to an initial count.

The reprisals highlight festering religious tensions in Nigeria, a nation of more than 160 million people. The attacks occurred in the religious flashpoint state of Kaduna that sits at the border between the country's predominantly Muslim north and its mainly Christian south. A history of attacks and counterattacks between the two communities means that authorities are often cautious about releasing death figures.

... Authorities fear that a breakdown of the deaths will trigger revenge killings. Most of the victims killed in church on Sunday are presumed to be Christian and most of those killed in reprisal attacks are presumed to be Muslim, raising concerns that a distinction between initial and reprisal deaths will be interpreted as a Christian and Muslim breakdown.

... The group known as Boko Haram said in an email that it was responsible for the attacks.

By the way, 'REPRISALS'? I would like to see from the 'journalist' who wrote this for the AP to provide with confirmed (academically acceptable) citations of the cases where Christian's in this region are using violence including bombs and machine guns to promote the establishment of a Christian theocracy in northern Nigeria. It's not happening, but to this pinhead, it's all about moral equivalency to marginalize and diminish the odious actions of Boko Haram.

It's interesting when historians fail to learn from history - or are so blinded by their political ideology that they refuse to see the lessons from history which discredits their political ideology. Here's an example of one of these historians...the very liberal Doris Kearns Goodwin...courtesy of

On Sunday's NBC Meet the Press, liberal historian Doris Kearns Goodwin pleaded with President Obama to tell voters: "'I am doubling down on what I did.' He didn't do enough on the stimulus. He didn't do enough investing in the future. The things he believes in, he has to say we need more of it. And that's our future."

Four consecutive years of deficits greater than $1.2 trillion. Adding $5 trillion to the national debt in 38 months. A $850 stimulus package that was supposed to keep unemployment from exceeding 8%- and Kearns Goodwin says he should have done more? Too bad she hasn't learned from France, Greece, Spain, etc....

Historian Niall Ferguson has a completely different take, writing in the Telegraph that "Young people should welcome austerity measures because it means huge government debts are less likely to blight their futures." He goes on to say...
"The last corporation to publish financial statements this misleading was Enron," he wrote.
"These mind-boggling numbers represent nothing less than a vast claim by the generation currently retired or about to retire on their children and grandchildren, who are obligated by current law to find the money in the future, by submitting either to substantial increases in taxation or to drastic cuts in other forms of public expenditure," he said.

He argues one of the ways out of the current economic “mess” would be for “a heroic effort of leadership” to persuade all generations to “vote for a more responsible fiscal policy.”

He suggests countries pass bills forcing their governments to balance the books and reign in "baby-boomers' profligacy", and says that voters are willing to "scapegoat" politicians and financiers but are unwilling to accept they borrowed too far.

If they fail, he warns, Western democracies “are going to carry on in their current feckless fashion until, one after another, they follow Greece and the other Mediterranean economies into the fiscal death spiral that begins with a loss of credibility, continues with a rise in borrowing costs, and ends as governments are forced to impose spending cuts and higher taxes at the worst possible moment."

Historian Victor Davis Hanson has an excellent essay this week as he looks at 'The Scandal of Our Age' - the leaking of classified information from within the Obama Administration...
“Classified” is now a postmodern idea, as we see from Ignatius. I think the damage-control procedure will go like this: although we, the public, could not read what the New York Times and Washington Post people read, these “classified” sources were still not really classified. You see, the president decides from moment to moment what is legally classified, what not. When given to a reporter to ensure the public knows that an Achilles rather than a Paris is our commander in chief, the documents in a nanosecond became declassified. In other words, once these leaks go into print, then immediately postfacto all such information was declassified all along: stupid us, we just never asked to read it or talk with these folks who had.

If — a big if — and when either Congress or the media goes after the damage that was done to U.S. interests, expect that almost every subpoenaed source imaginable is now “classified” — as in “How dare you ask for classified information that might endanger the national security just to find out how and why we released ‘declassified’ information that did no harm at all.”

Reader, forget politics. Just digest the nature, theme, the timing, and the damage of these disclosures. Do that and most of you will conclude they are offenses to the security of the United States — or, in the words of Barack Obama on another matter, “unpatriotic.”

Another excellent writer for PJ Media, and longtime blogger, Richard Fernandez of The Belmont Club, has not only a thought provoking essay today, but introduces the reader to a very interesting book about the Coming of the Next American Republic. This reflects how government has grown far from the principles of the founding fathers...
The catastrophe happened, DeLong says, because the Founders forgot that factions could cooperate as well as compete through log-rolling as well as a host of other mechanisms. The interest groups had become despite their differences, what Leo Linbeck has called the Party of Incumbency and more broadly what Angelo de Codevilla termed the “court party” or the New American Ruling Class. They realized it was in their common interest to cooperate in order to put themselves collectively in charge of literally everything. DeLong writes:

The number of federal government agencies is countless, literally. The official list at contains 479 distinct departments and agencies, but no standard exists for classifying parents and subunits and sub-subunits and so on. In the Government Manual’s index of agencies that appear in Code of Federal Regulations, the Department of Agriculture alone lists thirty-two distinct regulation-issuing subunits. Clearly, hundreds of federal agencies have the power to issue regulations having the force of law. States and municipalities echo the federal structure, with California alone listing over 500 agencies that employ more than 350,000 people. Add in all the states and cities and the number of rule-making entities mounts into the thousands.

Along the way the special interest coalitions progressively discredited the Old Republic idea that factions were a bad thing. That is now a quaint idea superseded by the notion that there is nothing special interest lobbying cannot solve. A compliant media has convinced the public that to every problem there is an agency and a rule for every purpose under heaven.

The media has learned to craft “compassion trap” stories in which heart-rending problems can be fixed by yet another government bureaucracy whose creation only the cruel could refuse to fund. What DeLong calls “a powerful bootleggers-and-Baptists coalition” has written the narrative of modern times. Together they have created a “ratchet” and the wheel winds only one way.

In consequence, learning how to manipulate the system became the key modern skill. As DeLong notes that any damn fool can learn to make a million dollars, but only someone who understands Washington can get you into the real big time. “Many venture capitalists can make money by shrewdness, but there is only one Al Gore; by adding him to your team, you can collect half a billion dollars in government subsidies for an electric vehicle.”

[Emphasis is mine]

Wrapping up on the history theme of today's QH, here's a list of one historians list of the Top 10 Battles of All Time:

10. Vienna - Austria-Ottoman Wars, 1529
9. Waterloo - Napoleonic Wars, 1815
8. Huai-Hai - Chinese Civil War, 1948
7. Atomic Bombing of Japan - World War II, 1945
6. Cajamarca - Spanish Conquest of Peru, 1532
5. Antietam - American Civil War, 1862
4. Leipzig - Napoleonic Wars, 1813
3. Stalingrad - World War II, 1945
2. Hastings - Norman Conquest of England, 1066
1. Yorktown - American Revolution, 1781

It's an interesting list. I have a few quibbles with the list. For example, I do not think Leipzig is deserving of a top 10 position, and while Yorktown is a top 10, it's not number one. Stalingrad was the turning point of the fight between Germany and the USSR in World War II, but I think some of these battles not list may be slightly more important. My list of missing battles that could be easily considered in the Top 10 listing....

Battle of Tours (aka Battle of Poitiers), 732
Battle of Lepanto, 1571
Battle of Marathon, 490BC
Battle of Salamis, 480BC
Battle of Britain, 1940

On This Day in History

1778 - British forces abandon Philadelphia - after nearly 9 months of occupation, 15,000 British troops evacuate the city, cross New Jersey, and return to New York City.

1812 - President James Madison signs the declaration of war against Britain into law, beginning the War of 1812.

1815 - Napoleon Bonaparte is defeated by an international army commanded by the Duke of Wellington at the Battle of Waterloo - ending his effort to re-establish his European empire. His army shattered, Napoleon would abdicate on June 22 and surrender to the British on July 15.

1942 - Sir Paul McCartney is born.

1966 - General William Westmoreland, the senior US military commander in Vietnam requests from the Joint Chiefs of Staff an additional 111,000 combat troops for 1967 – bringing the total to over 540,000 men. President Johnson granted the request. By 1969, the numbers of US troops in South Vietnam would peak at 543,500.

1972 - A BEA Trident jetliner en route to Brussels crashes after takeoff from London's Heathrow Airport, killing all 118 passengers and crew on board. The cause of the crash remains a mystery.

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