Thursday, May 26, 2016

Thursday, May 26, Night Wall Street Roundup: Wall St. Hits 'Pause' After Two-Day Surge

By Noel Randewich
May 26, 2016

Wall Street treaded water on Thursday following two days of strong gains as advancing utilities offset declines in materials, banks and other cyclical industries.

Investors this week have grown more comfortable with expectations the Federal Reserve could raise interest rates as soon as June, with many taking the view that such a hike would reflect improvement in the country's economy.

After gaining 2 percent over the previous two sessions, the S&P 500 traded flat, with a 1.1 percent dip in the materials index .SPLRCM partly offset by a 1.06 percent rise in utilities .SPLRCU.

"People are taking their foot off the gas after making a bunch of money, and now they're waiting for the next data point," said Phil Blancato, chief executive of Ladenburg Thalmann Asset Management in New York.

In line with other policymakers who have spoken in recent days, Fed Governor Jerome Powell said a rate hike may come "fairly soon" if data confirms the U.S. economy is continuing to grow and labor markets are still tightening.

Data showed that while orders for U.S. durable goods surged in April, business spending plans continued to show signs of weakness, suggesting the manufacturing rout was far from over.

Trading near 16.5 times expected earnings, the S&P 500 appears fairly priced, said Michael Mussio, managing director with FBB Capital Partners. "We’re not expecting any significant increase in earnings for the S&P 500 this year compared to last year," he said.

The Dow Jones industrial average .DJI dipped 23.22 points, or 0.13 percent, to end at 17,828.29 points and the S&P 500 .SPX edged down 0.44 points, or 0.02 percent, to 2,090.1.

The Nasdaq Composite .IXIC added 6.88 points, or 0.14 percent, to 4,901.77.

Muted volume suggested that some investors had already checked out ahead of an upcoming long weekend, with U.S. stock markets closed on Monday for the Memorial Day holiday.

Just 5.8 billion shares changed hands on U.S. exchanges, well below the 7.2 billion daily average for the past 20 trading days, according to Thomson Reuters data.

Apple (AAPL.O) shares rose 0.79 percent, providing the largest boost to the S&P 500, while Citigroup (C.N) fell 1.77 percent, weighing most on the index. Discount retailers Dollar General (DG.N) rose over 4 percent and Dollar Tree (DLTR.O) rallied nearly 13 percent, both hitting record highs after reporting better-than-expected quarterly profits.

Abercrombie & Fitch (ANF.N) shares slumped 15.67 percent after the retailer posted its 13th straight quarter of sales declines.

Costco Wholesale (COST.O) rose 3.58 percent a day after posting quarterly earnings.

In extended trade, GameStop (GME.N) tumbled 7 percent after the videogame retailer reported a decline in quarterly revenue.

Advancing issues outnumbered declining ones on the NYSE by 1,552 to 1,449, while on the Nasdaq, 1,507 issues fell and 1,269 advanced.

The S&P 500 posted 22 new 52-week highs and 1 new low; the Nasdaq recorded 55 new highs and 26 new lows.

Article Link to Reuters:

Oil Dips After Hitting $50/Barrel As Glut Worries Resurface

By Barani Krishnan
May 26, 2016

Oil prices hit $50 a barrel on Thursday for the first time in seven months, then bounced below that level and settled lower on the day as investors worried robust price gains could encourage more output and add to the global glut.

Wildfires in Canada's oil sands, unrest in the Nigerian and Libyan energy sectors, and a near economic meltdown in OPEC member Venezuela have knocked out nearly 4 million barrels per day in immediate production, sparking a buying frenzy in crude futures.

Brent and U.S. crude's West Texas Intermediate (WTI) futures have risen nearly 90 percent from 12-year lows hit this winter. They have recouped about half of what they lost since mid-2014 when both traded at above $100 a barrel.

A climb above $50 per barrel could spur producers, particularly U.S. shale drillers, to revive scrapped operations, which could bloat supplies and trigger a new selloff, analysts said.

"We are viewing current risk/reward ratios as unfavorable toward new longs at current levels," said Jim Ritterbusch of Chicago-based oil markets consultancy Ritterbusch & Associates, who cites a potential drop of Brent to $47.50.

Brent LCOc1 surged as high as $50.51, its highest since early November, then retreated and settled down 15 cents at $49.59 a barrel.

WTI CLc1 fell 8 cents to settle at $49.48, after reaching $50.21, its highest since early October.

U.S. crude for the balance of 2016 CLBALst remained above $50 while the calendar strip for 2017 CLYstc1 was above $51.

"I am maintaining my oil view at neutral with a short term bias to the upside," said Dominick Chirichella, senior partner at the Energy Management Institute in New York. "The global surplus still exists and there is still a possibility that oil prices could retrace further."

But he conceded that crude was trading "more and more in sync with the forward looking or perception view with the overall bearish fundamentals mostly priced into the market as production issues offset any short term negativity".

Adding to outage concerns, a source at Chevron Corp (CVX.N) said the producer's activities in Nigeria had been "grounded" by a militant attack, worsening a situation that had already restricted hundreds of thousands of barrels from reaching the market.

Investors will watch next month's meeting of the Organization of the Petroleum Exporting Countries (OPEC) for signs of an output hike.

"The bigger risk is that following the meeting, (the) Saudis will increase production to meet rising summer domestic demand, to preserve market share in its oil wars with Iran and Iraq," David Hufton, head of PVM Oil brokers, said.

Article Link to Reuters:

U.S. Sees First Case Of Bacteria Resistant To All Antibiotics

By Ransdell Pierson
May 26, 2016

U.S. health officials on Thursday reported the first case in the country of a patient with an infection resistant to all known antibiotics, and expressed grave concern that the superbug could pose serious danger for routine infections if it spreads.

"We risk being in a post-antibiotic world," said Thomas Frieden, director of the U.S. Centers for Disease Control and Prevention, referring to the urinary tract infection of a 49-year-old Pennsylvania woman who had not traveled within the prior five months.

Frieden, speaking at a National Press Club luncheon in Washington, D.C., said the infection was not controlled even by colistin, an antibiotic that is reserved for use against "nightmare bacteria."

The infection was reported Thursday in a study appearing in Antimicrobial Agents and Chemotherapy, a publication of the American Society for Microbiology. It said the superbug itself had first been infected with a tiny piece of DNA called a plasmid, which passed along a gene called mcr-1 that confers resistance to colistin.

"(This) heralds the emergence of truly pan-drug resistant bacteria," said the study, which was conducted by the Walter Reed National Military Medical Center. "To the best of our knowledge, this is the first report of mcr-1 in the USA."

The study said continued surveillance to determine the true frequency of the gene in the United States is critical.

Article Link to Reuters:

Trump Takes Aim At U.S. Environmental Regulations To Boost Oil Sector

By Valerie Volcovici and Emily Stephenson
May 26, 2016

Donald Trump, the presumptive Republican presidential nominee, promised on Thursday to roll back some of America's most ambitious environmental policies if elected, actions that he said would revive the ailing U.S. oil and coal industries and bolster national security.

Trump said he would pull the United States out of the U.N. global climate accord, approve the Keystone XL oil pipeline from Canada and rescind measures by President Barack Obama to cut U.S. emissions and expand protections for U.S. waterways.

"Any regulation that's outdated, unnecessary, bad for workers or contrary to the national interest will be scrapped and scrapped completely," Trump said at the Williston Basin Petroleum Conference in Bismarck, the capital of oil-rich North Dakota. It was Trump's first speech detailing the energy policies he would advance from the White House.

"We're going to do all this while taking proper regard for rational environmental concerns," he said.

The comments painted a stark contrast between the New York billionaire and his Democratic rivals for the White House, Hillary Clinton and Bernie Sanders, both of whom advocate a sharp turn away from fossil fuels and toward renewable energy technologies to combat climate change.

The comments also drew quick criticism from environmental advocates, who called his proposals "frightening."

"Trump’s energy policies would accelerate climate change, protect corporate polluters who profit from poisoning our air and water, and block the transition to clean energy that is necessary to strengthen our economy and protect our climate and health," said Tom Steyer, a billionaire environmental activist.

But industry executives cheered the stance.

"It’s simple. If Trump wins, oil field workers will be happy. If Clinton wins, oil workers will be unhappy," said Derrick Alexander, an operations manager at oilfield services firm Integrated Productions Services, which has laid off 2,000 workers in recent months.

Cancel Paris

Trump said slashing regulation would help the United States achieve energy independence and reduce America's reliance on Middle Eastern producers. "Imagine a world in which oil cartels will no longer use energy as a weapon," he said.

Until Thursday, Trump had been short on details of his energy policy. He has said he believes global warming is a hoax, that his administration would bring a revival to the ailing U.S. coal industry, and that he supports hydraulic fracturing - an environmentally controversial drilling technique that has triggered a boom in U.S. production.

Earlier this month, he told Reuters in an interview that he would renegotiate "at a minimum" the U.N. global climate accord agreed by 195 countries in Paris last December, saying he viewed the deal as bad for U.S. business.

He took that a step further in North Dakota. "We're going to cancel the Paris climate agreement," he told the crowd of roughly 7,700.

He also promised he would invite Canadian pipeline company TransCanada to reapply to build the Keystone XL pipeline into the United States, reversing a decision by Obama to block the project over environmental concerns.

"I want it built, but I want a piece of the profits," Trump said. "That's how we're going to make our country rich again."

Trump's campaign has tapped U.S. Representative Kevin Cramer of North Dakota, an ardent drilling advocate and climate change skeptic, as his top energy policy adviser.

Cramer said he had suggested that Trump slash regulation, reform the federal tax code and examine the role of OPEC producers to help make the domestic energy industry more competitive.

Article Link to Reuters:

Democratic Unity Will Be Harder In 2016 Than In 2008

But there are three powerful reasons to believe it will happen anyway.

By Brian Beutler
The New Republic
May 26, 2016

If you divide the world of liberal politics into two groups of people—those prone to panic and those who are sanguine about the coming election—you’ll hear two different stories about the state of the Democratic primary.

Former Harry Reid aide Jim Manley spoke for the former group when he told CNN, “I am increasingly concerned that even if Senator [Bernie] Sanders would come around and support a [Hillary] Clinton nomination that things become so polarized that not all of the supporters would agree to do so. I am afraid he has made this internal debate so polarized that even if he comes around, far too many of his supporters would just be so disgusted with the process that they won’t come out in the numbers needed.”

The Washington Post’s Greg Sargent, in contrast, thinks the panickers should stop panicking, because this is all normal for a late-stage Democratic primary, and Clinton’s actually doing fairly well. “According to this one metric, at least, the percentage of Clinton’s supporters in 2008 who seemed prepared to bolt was marginally larger than the percentage of Sanders supporters who now say the same,” Sargent notes. “Meanwhile, in today’s poll, Clinton is viewed favorably by 62 percent of Democrats. But in April of 2008, Barack Obama was viewed favorably by only 57 percent of Democrats—again, worse.”

These two groups interpret narrowing general election polls along similar lines. Nervous liberals see Clinton in a precarious position thanks to Sanders’s refusal to drop out and endorse her; unflappable liberals believe the polls will narrow quickly once the Democratic race is officially decided, again citing the 2008 election as a historical precedent.

For the time being, I align myself with the latter set, but would caution both that the path to party unity will be less straightforward this year than it was in 2008. Three differences in particular will make the process trickier now than it was before, offset by three forces that will help bridge the party divide.

Here are the three main sources of contention:

1. Ideology

The 2008 primary was far more acrimonious than this year’s primary has been, which is odd in hindsight because Clinton and Obama were running on nearly identical domestic policy platforms. That is not the case this year. Sanders’s economic agenda is more ambitious than Clinton’s: more closely aligned with progressive ideals; less preemptively constrained by political pragmatism. Compounding this particular difference, Democrats in 2008 nominated the candidate who had been opposed to the Iraq War from the outset, and who best represented the foreign policy sensibilities of the Democratic base. This year, the situation is reversed. Few Clinton supporters found Obama’s foreign policy instincts difficult to swallow, whereas Sanders supporters will be asked to support a candidate whose foreign policy judgment they do not trust. Unity will require more substantive concessions from Clinton than Obama ever had to make, and for Sanders supporters to make peace with a relatively incremental agenda.

2. Leadership 

Obama and Clinton made somewhat different cases for their own candidacies. Obama ran (incorrectly, it turns out) as a uniquely gifted uniter, who could heal partisan wounds. Clinton ran as a worker and a fighter who could notch progressive victories through her mastery of politics. The difference seems significant, until you compare it to today’s primary where Clinton is making a very similar pitch, and Sanders is promising a political revolution powerful enough to drive big money and corruption out of politics and bring social democracy to America. If that appeals to you then the presidency Clinton promises—one that would represent many of the ills Sanders has run against—will sound horribly uninspiring by contrast.

3. Change 

In 2008, liberals were reeling from eight humiliating years of Republican rule, and the country at large was desperate for real change. For Democrats who saw Obama as a deeply disappointing second choice, he was still far preferable to four or eight more years of indignity.

Fortunately, Democrats will benefit from three countervailing pressures.

1. Identity 

As an African American and a female respectively, both Obama and Clinton promised historic presidencies. To some extent this may have made Democratic unity in 2008 easier than it would have been if, say, Obama were white. Likewise, if Sanders had defeated Clinton this year, liberals excited by the prospect of electing the country’s first female president would have been sorely disappointed. But Clinton is going to win the Democratic primary, and as the only candidate capable of breaking the male-dominated mold of the presidency, her victory will provide a distinct appeal to many Democratic voters who supported Sanders for ideological reasons.

2. Barack Obama 

Most Clinton voters say they would happily vote for Sanders, and most Sanders voters say they would happily vote for Clinton. But what Democratic voters really want is to be able to vote for Obama again. He is far and away the most popular Democrat in America; recent opinion polls show him clearing 50 percent approval ratings, and 10 points above water. He will be Clinton’s most vocal and effective surrogate. And his signature accomplishments will be on the line.

3. Donald Trump 

Even if Obama’s approval ratings mask a certain degree of Democratic Party fatigue in the broader electorate, there’s no denying that the country is less hungry for change now than it was eight years ago. To overcome that, Republicans were going to need to nominate an Obama of their own—someone capable of flirting with 60 percent favorability, the way candidate Obama did. Instead, they nominated Trump, who is poised to be the most despised major party nominee of all time. If the thought of another term or two in the political wilderness was enough to convince PUMAs to fall in line for Obama, the thought of a Trump presidency will bring most hardened Sanders voters back home to Clinton.

Article Link to The New Republic:

How Clinton Can Demolish Trump

By Ramesh Ponnuru
The Bloomberg View
May 26, 2016

Each party is on track to nominate the only candidate who could possibly lose the election to the other. In the latest Washington Post-ABC poll, a sizable majority of Americans considered Donald Trump unqualified to be president. But Hillary Clinton is so unpopular that they still preferred Trump to her.

Anxious Democrats are wondering just how they should take him down. There are many possible lines of attack -- but many of them come with drawbacks.

It might be tempting, for example, to portray Trump as a misogynist. But some liberals worry that doing so will compound Clinton’s deficit among men. Democratic strategist David Axelrod suggests that Clinton stay away from this criticism because it’s unnecessary: “I think the behavior that would drive women to react negatively to him is pretty evident, and you don’t need to make that the focus of your campaign.”

Clinton could attack Trump instead as a con man and a fraud. But the message may not be effective coming from her. Most voters don’t think she’s honest either, and think she too is looking out primarily for herself. Besides, she doesn’t need to gain support from people who are being fooled by Trump; she needs to win over people who dislike him but dislike her too.

Trump’s business record might not end up being as much of a liability for him as Mitt Romney’s was in 2012. Democrats said that he had made a fortune by laying people off. While this was not exactly true, Romney never offered a simple explanation of the basis of his business to most Americans. Trump has: He builds things -- creating jobs in the process --and then slaps his name on it. The creditors and customers he has stiffed might tell you the truth is more complicated than that, but it puts him in a good initial position.

Democrats will be strongly tempted to attack Trump as a far-right extremist. He has taken positions that lend themselves to this criticism: He said women should be punished for abortions, has a tax plan that would slash taxes for rich people, and now opposes a ban on assault weapons. Attacking him this way would help Clinton win over supporters of Bernie Sanders. It’s a kind of campaign Democrats are familiar with running and to which Clinton would be able to bring real passion. (People may doubt her authenticity, but they know her hatred of what she labeled “the vast right-wing conspiracy” is genuine.)

But Trump is obviously not a conventional conservative, and wears all of his positions lightly. So a conventional left vs. right campaign might not clinch the case for Clinton.

Her most powerful message against Trump might be a non-ideological one: His lack of knowledge, seriousness and impulse control make him too dangerous to put in the presidency.

That strategy would have room for many specific criticisms of him that fit within the overall message of his unfitness. Instead of presenting his $11 trillion tax cut as a typical right-wing scheme, for example, she could tie it together with his speculation about defaulting on the debt and suggest that he is far more reckless than normal conservatives. (His encouragement of other countries to get nuclear weapons also illustrates this point.) And she would have to outsource some potential attacks to others. Calling Trump a “fascist,” for example, would make her rather than him look wild-eyed.

Clinton would be presenting herself as the candidate of safety. This strategy has its dangers, too. One is that people will decide, as Trump campaign manager Paul Manafort says, that he “can fill the chair.” Another is that Clinton would also become the candidate of the status quo at a time most Americans are dissatisfied with it. But this might be a risk worth taking. Henry Olsen, a conservative election analyst at the Ethics and Public Policy Center, says: “She needs to be the candidate for the person who is not irretrievably committed to blowing up the system. And I don’t think there’s a majority of those people.” The fact that the incumbent president has a 51 percent approval rating in the same Washington Post-ABC poll that has Trump slightly ahead suggests that Olsen is right.

Americans already think she is qualified to be president and he isn’t. The path should thus be open for her to get them to follow the implications of that thought. “I really think this is a race about temperament,” says Axelrod. “If I were a strategist on the other side of him, that would be the thing that I would work hard.”

My guess is that Clinton and her advisers will reach the same conclusion, and make Trump’s unfitness for the presidency the central message of her campaign. Her real meaning will not be explicitly spelled out, but will be unmistakable nonetheless: You may not like either of us, but you should fear him.

Article Link to The Bloomberg View:

Koch Group Launches Ground War — Against GOP Lawmaker

By Jonathan Swan
The Hill
May 26, 2016

RALEIGH, N.C. — The Koch-backed group Americans for Prosperity is pulling out all the stops to end Rep. Renee Ellmers’ career in Washington.

The group founded by billionaire brothers Charles and David Koch has dozens of field workers descending on the lawmaker’s district in the Raleigh suburbs, all of whom are working to brand the three-time incumbent as a fake conservative who has too often voted for legislation reaffirming Washington’s crony capitalism.

“This is someone who claimed to be a conservative leader,” said AFP's president, Tim Phillips, explaining the decision to single out Ellmers among so many other House Republicans who have voted for the same bills.

“And when you looked at her record on government spending and cronyism ... it's just not true.”

This is the first time the Koch network has ever opposed a sitting Republican lawmaker facing a primary fight.

The final straw was Ellmers' support for the Export-Import Bank, the ultimate example of crony capitalism in many conservatives' eyes, because it provides government-backed loans to large corporations.

If successful, the AFP campaign against Ellmers will become a cautionary tale for other congressional Republicans who don’t vote in line with the Koch network's agenda.

Ellmers is frustrated about the Koch campaign, and her chief of staff, Al Lytton, defended his boss's voting record in emails to The Hill on Thursday.

Lytton said Ellmers' vote for the 2013 budget deal, which won criticism from the right, was crucial to fund the military. Her vote for the Export-Import Bank saved thousands of jobs in her district, Lytton said. He also defended subsidizing green energy as supporting an “all of the above” energy policy.

“Perhaps AFP regrets Rep. Ellmers winning because she isn’t beholden to them — or any other Washington special interest groups like AFP,” Lytton said.

“Rep. Ellmers has and will always vote in the best interest of her district — she will not vote to please Washington or to pacify the Washington special interest groups."

AFP is launching a six-figure digital ad and direct mail campaign against Ellmers. But the real damage may be from the group’s ground game.

On Wednesday, The Hill spent a day with AFP as its North Carolina grassroots army visited the homes of likely Republican primary voters in Ellmers' newly redrawn second district ahead of the June 7 primary.

More than 2,000 doors were knocked on that day, according to state director Donald Bryson.

A vanload of conservative women in their 50s and 60s drove around the Raleigh suburbs, alighting at homes targeted by the Kochs’ voter targeting application. They were supported by younger staff, but they too are trained and permanently employed by AFP.

The grassroots army has another advantage: Its members know the neighborhoods and, in some cases, have already spoken to the people they're canvassing.

AFP is stationed full time in North Carolina — and 34 other states — year-round. This permanent presence makes the Koch army particularly dangerous for their political opponents during elections. AFP has a microscopic knowledge of congressional districts that only an annual budget of some $100 million can buy.

By election day, AFP will have made direct contact with nearly every Republican in Ellmers's district expected to vote in the primary against Rep. George Holding (R-N.C.) and two-time Senate candidate Greg Brannon.

It's hard to judge how much trouble Ellmers is in on June 7, and no good polling has been released for the 2nd district primary.

The Hill witnessed more than a dozen AFP doorstep conversations on Wednesday, and only one likely Republican primary voter said they would vote for Ellmers.

Most expressed a negative view of the incumbent congresswoman, which may be a result of compounded efforts by AFP and other conservative groups like the Club for Growth to brand Ellmers as a Washington crony.

Phillips, who is one of the most influential operatives in conservative politics and a top lieutenant of the Kochs, has no illusions about how difficult it will be to unseat Ellmers.

“North Carolina is one of our core states,” Phillips told The Hill on Wednesday. “We have a cold, clear-eyed view of how difficult it is to defeat an incumbent. It almost never happens. ... But we just thought it was important to take the stand here.”

Article Link to The Hill:

Elizabeth Warren Is Good At Her Job

By Francis Wilkinson
The Bloomberg View
May 26, 2016

Elizabeth Warren has a rare talent for distilling political messages. In 2011, as she was running for the Senate seat that she won the next year, the former Harvard law professor delivered the kind of concise, pointed rationale for public investment -- and the taxation to support it -- that the White House had been striving to master for the previous three years.

Speaking inside a supporter’s home, her remarks captured on a crude video that has since been viewed more than a million times, Warren addressed a prosperous, albeit entirely make-believe, business owner who was presumably questioning his tax burden:

"You moved your goods to market on roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police forces and fire forces that the rest of us paid for.

Now, look, you built a factory and it turned into something terrific, or a great idea. God bless -- keep a big hunk of it. But part of the underlying social contract is you take a hunk of that and pay forward for the next kid who comes along."

In his speech accepting the 2012 Democratic presidential nomination, Barack Obama reprised Warren’s theme, and with good reason. As colloquial political philosophy goes, Warren’s address made as good a case for the liberal social contract as you're likely to hear.

Warren didn’t run for president in 2016. If she had, there's a strong chance she would have eclipsed Bernie Sanders as the champion of the left, while also rallying the party agnostics who don’t much like Hillary Clinton but don’t want to damage her, either. Warren might have secured the nomination by now.

Warren balked. Yet she’s clearly determined to play a role in the campaign. She’s been using her rhetorical skills to bait Donald Trump, engaging in the sort of taunting, schoolyard Twitter war at which Trump excels. (Credit where it’s due.)

Tuesday, Warren went further. As Greg Sargent noted in the Washington Post, she began assembling the building blocks of a sustained character assault on Trump. In sync with the Clinton campaign, she seized on a 2006 Trump quote in which he expressed optimism that the housing market would crash so that he could profit from it. But Warren made more of it. It was an example, Warren said, of a “small, insecure money-grubber” who is ever eager to make a quick buck off the misery of others. Then she cited Trump comparing paying taxes with "throwing money down the drain."

As Sargent pointed out, she used this as evidence of Trump reneging on the social contract, an act made more contemptible due to Trump’s inherited wealth and advantages. In effect, Warren carried forward her argument of 2011.

Warren’s talents will be used this year. The only question is how. There are three ways the Massachusetts lawmaker might prove pivotal.

-- First, as Clinton’s vice presidential nominee. As a liberal woman from the northeast, Warren wouldn’t balance the ticket -- but that may be a plus. Clinton is a struggling candidate with shaky support. Warren wouldn’t complement her so much as fortify her, serving as a fire-breathing 60-something Louise to Clinton’s less dynamic Thelma. We’ve had two men on a ticket more than a few times. A Warren nomination would be a double-barreled announcement of change.

-- Second, as Clinton’s Bern whisperer. Bernie Sanders supporters are a natural constituency for Warren, and it’s easy to imagine Warren serving as a bridge for them to trudge the unhappy last mile from Sanders to Clinton. Sanders no doubt intends to deliver his voters himself, with strings attached. Warren is there in case his ego gets entangled during the transfer.

-- Third, as Clinton’s premier attack surrogate. Warren has already formulated a crisper, more penetrating attack on Trump than Clinton has voiced. In the coming months, she’ll refine both the argument against him, and her delivery. She’s good at this. Meanwhile, she keeps drawing fire from Trump, who is incapable of ignoring her.

Of course, if Clinton were to do the unconventional and choose Warren as her running mate, Warren could fulfill all three of those roles. But one way or another, it looks like we’ll be hearing a lot from Warren on the campaign trail.

Article Link to The Bloomberg View:

Obama In Vietnam: Long On Weapons, Short On Human Rights

Vietnamese hoping he'd bring change were disappointed

By Gary Sands
The National Interest
May 25, 2016

United States President Barack Obama waved goodbye to Vietnam today, following meetings in Hanoi and Ho Chi Minh City with Vietnam’s new leadership, young entrepreneurs, and civil rights activists. Despite waiting until now to visit Vietnam for the first time, he leaves behind an enduring legacy of goodwill, as thousands of Vietnamese flocked to line the streets throughout his three-day visit in hope of catching a glimpse of the widely-popular U.S. president.

On Monday, Obama also hoped to leave behind any of the remnants of animosity between the two former enemies of the Vietnam War—by announcing a complete lifting of an embargo on lethal weapons sales to Vietnam. The Vietnamese have been clamoring for advanced weaponry from the United States since the normalization of relations in 1995, and Washington partially eased the embargo toward the end of 2014 to allow for the sale of some defensive maritime equipment to Vietnam.

Last year, Vietnam was the eighth-largest purchaser of arms in the world and over the last five years arms imports are up 699 percent. Hanoi currently buys a significant amount of military equipment from Russia, including Kilo-class submarines and corvettes, although they seek to buy more advanced equipment from other nations, such as the United States, in keeping with a diversified “no military alliance” foreign policy. U.S. defense contractors are salivating over sales, most likely the P-3 surveillance planes, helicopters and missiles Hanoi needs to beef up its naval forces and coastal defenses.

The full lifting of the embargo fits neatly into Obama's strategic "pivot" toward the Asia-Pacific region, and may help to boost Hanoi’s defenses against an encroaching China. Yet given Vietnam’s past record on human rights and recent domestic turmoil, at a joint press conference held on Monday, Obama felt it necessary to include a proviso, “As with all our defense partners, sales will need to still meet strict requirements, including those related to human rights.”

Thousands of protesters have gathered in Hanoi and Ho Chi Minh City on three successive Sundays this month to vent their anger at the government over their response to the death of one hundred tons of fish in the central provinces in April. The protesters widely believe a $10.6 billion coastal steel plant in Ha Tinh province, owned by a unit of Taiwan's Formosa Plastics, is to blame for discharging untreated waste into the ocean.

The first protest on May 1, International Workers Day, was allowed to attract hundreds of demonstrators, although under heavy surveillance by police forces, regular army, paramilitaries, rural militia forces and "neighborhood guardians." On the second Sunday, security officials cracked down on demonstrators using tear gas to disperse the protesters and reportedly beating around three hundred people. Others were reportedly arrested and later freed after questioning.

The third Sunday protest this month saw Vietnamese authorities taking a more proactive, authoritarian line toward the protesters, issuing an eleven-minute warning on several state-run television channels to shun calls by "reactionary forces" to join protests, and questioning their motives. Vietnam Television (VTV) also disclosed names and images of well-known dissidents and bloggers, and accused overseas groups such as the Viet Tan (Vietnam Reform) of funding the protesters, saying, "Their intention to abuse and disturb was revealed when many subjects called for using knives and petrol bombs to attack the functional forces and to overthrow the authorities."

Following the warning by VTV, security measures were tightened in Hanoi and Ho Chi Minh City, allowing nothing more than small groups to assemble and demonstrate. In Ho Chi Minh City, some protesters were hoarded onto buses and driven far from the protest areas. Access to information on Facebook was also curtailed, after organizers used the social-media platform in a call to rally at certain venues around Ho Chi Minh City.

International human-rights organizations such as Human Rights Watch and the United Nations Human Rights Office for South-East Asia (OHCHR)have all expressed concern over the government's recent heavy-handedness toward political opponents and recent restrictions on freedom of expression and freedom of association and assembly. Those rights are embedded in article 25 of Vietnam’s 2013 Constitution: “The citizen shall enjoy the right to freedom of opinion and speech, freedom of the press, to access to information, to assemble, form associations and hold demonstrations.”

While there is no question some of the demonstrators would like to see the government removed from office, many others are seeking accountability for the environmental disaster and looking for responsible action taken in future to prevent similar disasters. A preliminary investigation found no links to Formosa's steel plant, and blame was deflected toward a possible "red tide" (when algae blooms and produces toxins), yet the Vietnamese citizenry are not buying into those answers. Newly elected prime minister Nguyen Xuan Phuc has promised a thorough investigation including outside experts from the United States, Germany and Israel, vowing "We will not shield anyone found causing the pollution."

While Obama may be loved by many Vietnamese, his lifting of the arms embargo—without imposing any apparent conditions precedent on improving human rights—only served to dishearten those citizen activists clamoring for freedom of speech, freedom of assembly and accountability for Vietnam’s largest environmental disaster. Obama did mention in his remarks, “there continue to be areas where our two governments disagree, including on democracy and human rights” and he did meet with several activists, although several were turned away or placed under house arrest at the last minute. On his first visit to Vietnam, many Vietnamese hoped Obama could bring meaningful change on human rights, but on the last legs of his farewell tour, it seemed there was little Obama could do but express his regrets over the missing activists.

Article Link to the National Interest:

The Democrats' Wasserman Schultz Problem

Removing the DNC chairwoman might not be worth the headache.

By Gabriel Debenedetti and Daniel Strauss
May 26, 2016

Debbie Wasserman Schultz isn’t going anywhere.

Not yet, anyway.

Months of Democratic frustration with the leader of the national party burst into clear view this week, leading to widespread speculation on Capitol Hill Wednesday about whether she will be able to finish out her term as Democratic National Committee chairwoman.

The debate over her future, however, overlooked one important element: the reality that replacing a party chair would be a complicated — and almost certainly messy — affair, one that the party is eager to avoid as it tries to heal its wounds after a bruising primary battle between Sanders and Hillary Clinton.

“I don’t know why we’re spending so much time on the chair of the Democratic National Committee, I don’t know what the point is,” said House Minority Leader Nancy Pelosi, making the case that replacing the chairwoman, whom she supports, would be far more complicated than many appreciate. “I was, for a long time — 20 years — a member of the Democratic National Committee. We thought we had some influence as to who would be the chairman of the party. [But] we know it’s up to the nominee. I think this is not helpful in terms of unifying the party."

Any short-term move to install a new committee chief would likely need to involve the hand of President Barack Obama, the de facto party leader who has demonstrated zero intention of stepping into the latest round of frustration with Wasserman Schultz over her stewardship of the Clinton-Sanders primary.

The simplest way to install a new chair before there is a formal nominee would be a mandate from the White House, which has had tense relations with Wasserman Schultz in the past. But with Obama abroad, an aide to Vice President Joe Biden told The Hill — the first to report on a possible move to oust her before the Democratic convention in July — that he supports her, a move that was read within the DNC as a signal of the president’s backing.

On Wednesday, few congressional Democrats were willing to throw Wasserman Schultz under the bus on the record — and many were eager to change the conversation altogether, careful to avoid exacerbating the image of party strife.

New York's Chuck Schumer, a Clinton ally who is expected to ascend to the Senate Democratic leader role next year, declined to comment and said he wouldn’t be “mixing it up” on the issue. Patty Murray of Washington, the highest ranking woman in the Senate, said she’s “focused” on her own job when asked about the DNC. Senate Minority Leader Harry Reid of Nevada joined his fellow Clinton backers in sidestepping the matter, insisting “that’s not up to me” whether Wasserman Schultz should stay on.

“From my perspective, I just think the real harmony doesn’t come with Debbie Wasserman Schultz, it happens between Bernie and Hillary,” added Montana’s Jon Tester, who leads the Senate Democratic campaign arm. “It’s a DNC thing. I just really don’t pay attention to what she does, to be honest with you."

That kind of studied silence from Senate leaders, including some who are close to Clinton’s team, comes after a year of behind-the-scenes grumbling from various corners of the party over Wasserman Schultz’s oversight of the race. The frustrations were initially voiced by Sanders and then-candidate Martin O’Malley, who bristled over the party’s decision to schedule just six debates before the Clinton and Sanders camps came to an agreement to add more. More recently, Sanders supporters watched with dismay as the Vermont senator fought the chairwoman to gain more representation for his allies on the convention committees.

Publicly, the Clinton campaign continues to offer its measured support, even if many Clinton backers have been privately playing the “who replaces Debbie” parlor game for months with the expectation of a new chair falling into place at some point before the next president is inaugurated.

Clinton's press secretary Brian Fallon on Wednesday evening noted that the calls to replace the chairwoman had come from Sanders, not Clinton, but he stopped short of outright supporting her.

“From our viewpoint, Debbie Wasserman Schultz is a very dedicated leader for our party. There is nobody more committed to her, nobody more committed than her, to making sure that Donald Trump is not the president in 2016 in November when we have the general election,” he said on CNN. “You've heard Bernie Sanders suggest that he would seek to remove her. We have not said that.”

Sanders has recently amped up his ire against Wasserman Schultz herself after months of railing against the establishment writ large. Over the weekend he endorsed and raised money for her congressional primary opponent, just days after she spoke out against Sanders' response to Nevada's chaotic Democratic convention earlier this month.

But his supporters declined Wednesday to fan the flames against Wasserman Schultz, who has served in her role since 2011, or to call outright for her departure.

“I don’t see it happening,” said Minnesota Rep. Keith Ellison, one of Sanders’ first Washington endorsers who nonetheless called Wasserman Schultz a friend, of an impending move. “At the end of the primary cycle there’s always a little combustion. It’s fine, it’s part of the Democratic process. I’m not sensing any great doom impending."

Arizona Rep. Raul Grijalva, a Sanders supporter who co-chairs the House Progressive Caucus with Ellison, would only voice the standard criticism of the chairwoman — that she had put her finger on the scale for Clinton.

“It’s not her job to pick winners and losers. It’s her job to make sure the organization is tight and it supports Democrats, and the issue of the presidential race stays out of it,” said Grijalva. “That wasn’t the case. Everybody knows that. And people say the national party and the state party structures — which is dependent on the DNC — were not pro-Hillary. They’re not telling the truth."

Jane Sanders, the candidate’s wife, who serves as a top advisor on his campaign, met privately with Reid Wednesday morning in his office but declined to detail their conversation. When asked about Wasserman Schultz, she was blunt about her husband’s feelings: “I think he has said anything that we need to say."

Several congressional Democrats privately conceded they have heard talk about replacing Wasserman Schultz as a potential step for pulling Democrats together at some point down the road once Clinton officially clinches the nomination. If that scenario were to play out quickly, the party would avoid the kind of discord that might result from her playing a leading role at July’s convention in Philadelphia, where some Sanders supporters have already secured permits to demonstrate outside the convention hall.

But even partisans dissatisfied with the chairwoman’s role in the primary election acknowledged that it was never expected to be her role to unify the Sanders and Clinton camps, and they noted that she ultimately ceded ground on both the debate schedule and the makeup of the convention platform committee.

To try and remove her in the run-up to the convention would complicate an already delicate balancing act, especially since the chairwoman would be loath to go down without a bloody public fight, not least because she is facing a well-funded primary challenger who might find advantage in the furor. Some Democrats pointed to her response several years ago to speculation that she might be removed, when she lined up backers to suggest an ouster would be an anti-woman, anti-Semitic move.

And absent a change of heart in the White House, a maneuver to replace the chair would require a vote of the DNC membership, which likely could not come for at least another month — a significant disruption of party proceedings ahead of the convention as Clinton and Sanders work toward a detente.

The prospect of such unwelcome drama at such a crucial time makes any concrete steps toward unseating her “neither productive nor realistic,” in the words of Virginia Sen. Tim Kaine, a close Clinton ally and potential running mate who was Wasserman Schultz’s predecessor at the DNC.

“I just think that sort of thing, two or three or four weeks before a national convention, would just be intolerable,” added Don Fowler, the DNC chair under Bill Clinton from 1995 to 1997.

Article Link to Politico:

The Democrats' Wasserman Schultz Problem

The Racist Side Of Bernie Supporters

More proof that “progressive” isn’t a synonym for “tolerant.”

By Keli Goff
The Daily Beast
May 26, 2016

For decades, one narrative has dominated American politics: That while white liberal Democrats may not be perfect, they are far more trustworthy and far less scary when it comes to race than conservative Republicans.

The backers of Bernie Sanders’ never-ending Kamikaze campaign remind us of an older truth: that there are good people and terrible people in both parties and that Republicans do not have a monopoly on intolerance.

Donald Trump has without question run one of the most racially and ethnically divisive presidential campaigns in recent memory. So much so that as former Senator Bob Bennett lay dying, he asked his loved ones if there were any Muslims in the hospital. His reason? So that he could go up and apologize to each one of them for Donald Trump.

Did I mention Bob Bennett was a conservative Republican? He’s far from the only high profile conservative to come out swinging against Trump. Jeb Bush denounced Trump’s infamous Cinco de Mayo tweet in which he professed his love for Hispanics while eating a taco bowl, comparing it to eating a watermelon and saying ‘I love African Americans.’” Going a step farther, Bush said he will not vote for Trump in November. His brother and father, the two most recent former Republican presidents, have declined to endorse the party’s presumed 2016 nominee. Even more telling, they, along with the two most recent GOP nominees for president, Sen. John McCain and former governor Mitt Romney will not be attending this year’s Republican National Convention.

While a number of conservative Trump critics have attempted to diplomatically convey their problems with his rhetoric, and ultimately his candidacy, Republican senator Lindsey Graham has been refreshingly blunt: “He’s a race-baiting, xenophobic, religious bigot.”

While high-profile Republicans step forward to denounce one of their own and to argue that minorities should be treated with courtesy and respect, plenty of white progressives seem intent on putting us in our place, so to speak, and keeping us there. Though much of the media coverage of so-called “Bernie Bros” —overzealous, predominantly white, young and male Sanders supporters—has focused on their treatment of female journalists online, their lack of respect for racial and ethnic minorities who deign to challenge Sanders has been perhaps more chilling.

The Washington Post noted that at one point #MississippiBerning became a hashtag used by Sanders supporters on social media—a witty and clever turn of phrase unless of course you are a Black American who hears the words Mississippi Burning and immediately thinks of church bombings and lynchings.

Black writers and activists who have had the temerity to challenge Sanders’ record have been targeted by his supporters in ways that go against not just civility but even decency. I should know. I’m one of them. For having the gall to share my perspective, buoyed by polling data, that self-described socialists are pretty much unelectable to the American presidency, his supporters attempted to harass me offline. (Emphasis on “attempted.”)

Let me explain what I mean by “harass.”

While thankfully, I have someone who works for me and wades through much of my mail and social media so I can spend as much time as possible writing (and maintaining my sanity and sense of humor), for more than a week Sanders supporters flooded my accounts with nonstop accusations—one more over the top than the next. I am “a disgrace,” “a liar,” a secret paid Hillary Clinton “mole” or “shill.” Apparently it is beyond the realm of possibility that I, as a free-thinking individual with access to polling data and a fairly vigorous intellect of my own may not consider their chosen candidate a strong one. Simply not possible. After all, as one white Sanders supporter informed me: “You need to be better informed on the needs of Black people.” Thanks for the tip!

But there were a couple of messages that made their way to me that were particularly troubling. One Sanders supporter pleaded on Facebook for others to stop attacking me and try to “inform me” (Again this denotes I couldn’t possibly be educated because I don’t agree with them, but at least he sounded civil). To which another replied, “She chooses to ignore the issues and work for her own personal interest. If that is the case than to me everything is allowed as long as it’s not physical violence.”

Consider that statement for a moment.

He’s certainly right from a legal perspective, but what about from a moral and ethical one? By his rationale, if David Duke encouraged other white nationalists to send endless messages—filled with insults and taunts (but not facts)—but none of them physically threatened me, should I feel safe?

So when news broke that a prominent white, male liberal blogger known for his appreciation of Sanders and disdain for Hillary Clinton had called Neera Tanden, one of the most prominent women of color in progressive politics a “scumbag” I was not surprised.

And when I learned Sanders supporters had sent death threats to a female Democratic Party official because they were outraged at what occurred at the Nevada state convention, I was not surprised. And when Bernie Sanders declined to denounce such behavior vigorously, I was also not surprised.

Just as Donald Trump’s supporters would not demonstrate thuggish behavior, such as assaulting protesters, without getting signals from their leader that it’s acceptable, the same is true of Sanders’ supporters.

One difference is that Republicans haven’t spent decades selling themselves as the saviors of Black Americans or any Americans of color, frankly. The fact that a sizable number of prominent Republicans are willing to lose this election in the name of racial and religious tolerance is actually a jarring contrast to the increasing number of Sanders voters who argue they are willing to forfeit an election to a man many of them consider a racist and xenophobe, one who they know will harm minorities, rather than ever vote for his opponent, a woman they don’t like but who is not Donald Trump.

I have a feeling that whatever the outcome of this election, more minorities have come to realize over the course of this primary season that the word “progressive” is not synonymous with “tolerant.” But perhaps the biggest lesson is that there is no such thing as a specific political party or political label that can save us.

We have to save ourselves, and going forward maybe the best way to do that is to diversify more of our political power among the decent people in American politics—regardless of their party label.

Article Link to The Daily Beast:

China’s Love Boats In Disputed South China Sea

As President Obama offers support to Vietnam and Japan against China’s aggressive claims, Beijing puts on a kinder face with tourist trips.

By Brendon Hong
The Daily Beast
May 26, 2016

HONG KONG — This week, President Barack Obama was in Vietnam, where he made the case for stronger economic and security ties between his host and America. It was a welcome message, arriving at a time when China’s ballooning military and stubborn diplomatic rhetoric is causing unease even among former allies and intimate trade partners. The president is now in Japan for a G7 summit, where the same anxieties abound.

Meanwhile, in the South China Sea, the focal point for much of this unease, Chinese cruise ships are helping Beijing stake its claim on disputed islands.

“I love my country! I love Xisha!” Those are the words that Chinese tourists shout as they surround a flag pole on one of the uninhabited Paracel Islands, known to the Chinese as Xisha, the first stop on the cruise.

The second sight is a slab of concrete on a second island, indicating that visitors are standing in a “military forbidden zone.” Selfies by the inscription are encouraged. A lunch of grilled tropical fish is served by some of the 78 people who live there. They are paid 45 renminbi, or just under $7.00, each day by the Chinese government to remain on the islet. The stay of each “resident” lasts six to nine months.

The final stop is Silver Island, which is home to some 10 people and several construction sites. The Chinese government is building residential and office buildings on the island, and has designated the activity as something to be enjoyed by tour groups. The lesson is that the South China Sea is not only meant for the Chinese military, but also civilians.

The four-day South China Sea cruise, which started quietly in 2013, is operated by a Chinese state-run shipping company based on tropical Hainan Island. Patriots shell out anywhere between $500 and $3,600 for the privilege to travel through disputed waters, but only after they pass a screening test to measure their political leanings.

DIY adventurers are not welcome: this month, when a private sailboat left Hainan Island to visit the Paracel Islands without official approval, those involved were fined ¥29,000 ($4,400), and the vessel was impounded for 30 days. The punishment was a measure to control who is permitted to visit the islets. In particular, foreigners are not welcome.

China claims sovereignty over widely scattered atolls and reefs in the South China Sea, including the Paracel and Spratly Islands, based on a self-declared demarcation called the nine-dash line. Malaysia, Brunei, Vietnam, and the Philippines all claim some parts within the area.

To strengthen its own territorial claims, Beijing has embarked on a series of land reclamation projects, transforming reefs into landmasses that now have runways and radar facilities. The Great Wall of Sand, as some call it, has strained relations between China and its Southeast Asian neighbors.

Last year, as global defense spending dipped, military budgets in Asia saw a solid increase, mainly fueled by Chinese developments.

The Philippines increased its defense budget by 10 percent in 2015, and will soon be supplied with military equipment from Japan. Tokyo is also in a tug-of-war with Beijing over the East China Sea island chain known as Diaoyu to the Chinese and Senkaku to the Japanese.

Vietnam has recently purchased six fast-attack submarines from Russia. During a news conference in Hanoi, President Obama announced the U.S. will lift an arms embargo on Vietnam that has been in place since 1984.

The action may be in the South China Sea, but observers of East Asian geopolitics also have an eye on The Hague.

Last October, the Permanent Court of Arbitration (PCA) began hearing arguments of Philippines v. China, a case brought to the PCA concerning the legality of China’s territorial claims in the South China Sea. The Philippines maintains that the nine-dotted line violates the United Nations Convention on the Law of the Sea (UNCLOS), which defines nations’ rights and responsibilities regarding ocean waters. Though the Philippines claims the Spratly Islands based on proximity, they submitted the case with the underlying argument that even if Beijing’s claims to South China Sea islands were legitimate, the nine-dash line still exceeds China’s rights under UNCLOS.

China refused to participate in the hearings, and has stated that the dispute should be settled by negotiations between the two nations involved, not by legal experts in The Hague. This week, the Chinese consulate in Vancouver commissioned a newspaper ad in Canada’s Globe and Mail that stated the case “violates international law.”

The PCA is expected to announce a decision at the end of this month. Will that end the dispute? No. Neither nation will retract the claim of any territory, and diplomatic spats will continue. Any settlement, if it can be carried to term, will not be born in a courtroom.

Beijing is wary of Washington’s intense interest in the region’s developments. The U.S. navy periodically conducts freedom of navigation operations near disputed islands, much to the chagrin of Chinese admirals. The results are frequently predictable—fighter jets are scrambled, and the Chinese navy dispatches part of its fleet to follow their American counterparts. However, last week saw an escalated development. Two Chinese jets intercepted a U.S. military reconnaissance aircraft. The Pentagon called it an “unsafe” action.

The South China Sea sees $5 trillion of maritime trade each year, and is crucial to the economic health of East and Southeast Asian nations. Chinese President Xi Jinping considers the South China Sea as part of China’s “Maritime Silk Road,” a planned route that links ports in China with those along the east coast of Africa via the South China Sea, the Strait of Malacca, and the Indian Ocean. In particular, the Chinese navy will have access to China’s first overseas installation, which is currently under construction in Djibouti.

The PCA may be attempting to settle a row between two nations, but in point of fact the dispute is between China and everyone else.

In particular, representatives from five Asian nations—Vietnam, Thailand, Indonesia, Malaysia, and Japan—have been watching the hearings closely. Beijing’s attempts to plant fake islands and forced construction sites in the South China Sea have convinced no one of its territorial claims. With the increasing likelihood that China will set up an “air defense identification zone” over at least some portion of the South China Sea, just as it had done over areas contested by Japan in the East China Sea, the slow creep of militarization in a key economic corridor seems unstoppable.

And all the while the Xisha love boats will continue their cruises.

Article Link to The Daily Beast:

The State Department's Hidden Hillary Donors

Clinton’s super-donors poured millions into the State Department. Why was the government so reluctant to release the names of these high-rollers and socialites?

By Shane Harris and Jackie Kucinich 
The Daily Beast
May 26, 2016

Hillary Clinton may have suspended her political career temporarily when she became Secretary of State. But the Clinton fundraising machine was in full swing and raising millions of dollars for the State Department under her watch, an analysis by The Daily Beast has found.

More than a dozen donors to Clinton’s non-profit foundation and her various political campaigns poured money into an endowment she launched into 2010 to pay for the upkeep of the Diplomatic Reception Rooms. The 42 sumptuous salons at State Department headquarters in Washington, decorated with 18th and 19th century American furnishings, are used to welcome foreign dignitaries, conduct diplomatic meetings and swearing-in ceremonies, and host official dinners.

By the following year, the campaign had raised more than $20 million to permanently fund restoration and maintenance for the rooms and their collections of rare American artwork, thanks largely to reliable Clinton donors.

Nearly half of the 37 people and organizations who donated to the State Department campaign, known as Patrons of Diplomacy, also gave money to the Clinton Foundation, according to State Department and foundation records. Of the eleven people who served as co-chairs for the campaign, agreeing to contribute their own money or to help raise funds from others, six also gave to the Clinton Foundation, a global charity started by former President Bill Clinton.

Until this week the State Department seemed inclined to keep the names of these patrons private. When The Daily Beast initially asked to see the donor list, a department spokesperson said that it was already the subject of a Freedom of Information Act lawsuit by the Republican National Committee, and therefore couldn’t yet be released. (The RNC has filed six lawsuits against the State Department related to Clinton’s tenure, focused on potential conflicts of interest with her and her aides’ work for the foundation, as well as her use of a private email server for official business.)

But if the State Department wanted to keep the donors from public scrutiny, it’s not clear why their names are inscribed on a wall, located on a terrace off one of the reception rooms, with a sweeping view of the National Mall.

Only when The Daily Beast pointed out that an article in a 2012 issue of an internal State Department magazine mentions the donor wall was a reporter allowed to see it.

Having a name etched in stone was one of several donor perks, according to a glossy 22-page brochure that describes the important restoration and maintenance work that private contributions have funded over the years. Taxpayer funds may not be used for the reception rooms, which are open to the public and house a museum-quality collection of furniture, paintings, and documents.

“By becoming a Patron of Diplomacy, you are supporting the ongoing business of American diplomacy and investing in our nation’s future. Gifts to the campaign are tax deductible,” the brochure states.

Donors also receive “invitations to campaign events and ongoing activities,” as well as recognition on a Web site that has apparently been awaiting an update for the better part of four years. The Daily Beast was able to find an archived section of the Web site that contains the names of hundreds of donors who have given over the years, most of them before Clinton took office.

The Daily Beast found no evidence that donors to Patrons of Diplomacy had been offered favors or special access to the State Department, beyond what’s spelled out in the brochure. And there’s nothing nefarious about the raising of private funds to pay for public works. Indeed, private donors have been pitching in to support the rooms since 1961.

“The State Department and the Clinton Foundation are separate entities, and we can only speak to our programs and policies,” department spokesperson Mark Toner told The Daily Beast. “All donations to the Patrons of Diplomacy initiative were reviewed by the Department in accordance with applicable rules and regulations.”

But the overlap between the campaign and donors to the Clinton Foundation, as well as Clinton’s political campaigns, may be problematic for the Democratic presidential frontrunner. Along with her husband, Clinton has faced repeated criticism over the years that the foundation serves as a conduit for influencing official decision-making.

In addition to suing for the names of the donors, the RNC has also demanded information that its staff thinks could indicate some quid-pro-quo between donors and those seeking to get on Clinton’s good side. That information includes solicitations to the patrons campaign, invitations to the Diplomatic Reception Rooms, and visitor logs for Clinton’s “formal quarters” and personal office at State Department headquarters.

“The overlap between donors to the Clinton Foundation and this project raise more questions about influence buying at the Clinton State Department,” Raj Shah, the deputy communications director for the RNC, told The Daily Beast. “It’s becoming clearer by the day that reason Hillary Clinton set up her email server was to conceal unseemly conflicts of interest that were prevalent during her tenure. Now we see that evidence of these conflicts are literally carved in stone.”

Regardless of the RNC’s allegations, it’s clear that even when Clinton is not on the campaign trail, her family’s money-raising machine follows her. Clinton’s fundraising prowess dwarfed previous efforts at the State Department. Tax returns for a non-profit organization that has managed funds for the reception rooms since the 1980s show that, on average, it had about $4.8 million in assets on hand in the four years before Clinton took office. The fund was also losing money. Clinton and her friends and donors raised four times the fund’s assets, for a grand total of $20.3 million.

Clinton also personally pitched donors in a promotional video about the reception rooms and the patrons campaign.

“These rooms are completely paid for and furnished by private donations,” she noted. “The Patrons of Diplomacy is our effort to reach out and include people today who wish to make a contribution to keep these rooms going, to make sure that they remain as beautiful, historically significant, as they are right now.”

“The Diplomatic Reception Rooms enable the Secretary of State and other senior U.S. Government officials to receive distinguished foreign visitors with a touch of our nation’s history,” State Department spokesperson Mark Toner told The Daily Beast in a written statement. “In October 2011, the campaign was successfully completed…thereby ensuring that the Diplomatic Rooms and their Collection will continue to provide an extraordinary venue for American diplomacy for generations to come‎.”

Neither the Clinton Foundation nor the Clinton campaign responded to requests for comment.

State Department spokesman John Kirby also said that the department is currently processing the RNC’s request for the donor names and related information. But there has been a surge in requests under the Freedom of Information Act in recent years, with approximately 22,000 last year alone, he said. The department processes those requests “in an entirely nonpartisan manner,” Kirby added.

The patrons are collectively responsible for at least $33 million in contributions to the Clinton Foundation, according to publicly available records. Many gave donations in the five and six-figures, with a handful of seven-and eight-figure donors responsible for the lion’s share of the total. Those donors include some of the biggest Clinton fundraisers around, who’ve been supporting her and her husband’s political careers for years.

The Indiana philanthropist Bren Simon was deemed a “Grand Patron” of the patrons campaign, having contributed $1 million or more. She was also named a co-chair of the overall fundraising effort. Simon has also given between $1 million and $5 million to the Clinton Foundation, records show. Her philanthropic foundation, which shares the name of her late husband, the shopping mall magnate Melvin Simon, also gave the foundation between $250,000 and $500,000. And Bren Simon has personally donated the maximum amount under law to Clinton’s 2016 presidential campaign, as well as to her 2008 run and her earlier campaign for the U.S. Senate.

Several of the patrons donors are among the most devout of the Clinton network over the past few decades. At least three, Fred Eychaner, Virginia Governor Terry McAuliffe, and Dan Abraham, were among 63 people who gave $10,000—the maximum—to Bill Clinton’s legal defense fund, which was set up to pay his legal bills amid the various scandals that dogged his presidency, as well as his impeachment.

(McAuliffe’s own fundraising is now the subject of scrutiny. The FBI is investigating the onetime Clinton Foundation board member for potentially taking illegal campaign contributions, it was reported this week. Investigators are reportedly scrutinizing donations to McAuliffe’s gubernatorial campaign by Chinese billionaire Wang Wenliang, who also gave $2 million to the Clinton Foundation through his company, Rilin Enterprises. McAuliffe formerly served on the foundation’s board.)

At least 18 patrons also gave to Clinton’s various political campaigns ranging from her Senate campaign in 2000 to her current bid for president.

Eychaner, a reclusive media entrepreneur and so-called “Hillblazer,” has raised at least $100,000 in contributions to Clinton’s presidential campaign. She personally thanked him for serving as a co-chair for Patrons of Diplomacy in her remarks at a 2011 reception to celebrate the 50th anniversary of the Diplomatic Reception Rooms.

Eychaner is a rarity among Clinton donors, being one of only seven people who has given $25 million or more to the Clinton Foundation. A 2015 analysis by Politico found confusion over whether Eychaner had personally given the money or donated through his own foundation, Alphawood. But Eychaner’s prominent donor status isn’t in doubt. In the 2016 election cycle, he has personally given just over $4 million to Democratic outside spending groups, including political action committees, according to data compiled by the Center for Responsive Politics. Eychaner gave $2 million to Priorities USA Action, the main super PAC backing Clinton for president.

Henry Laufer and his wife, Marsha, whose names are also on the patrons wall, held a fundraiser for Clinton’s presidential run this past April in their south Florida home. And in February, Laufer, a vice president at Renaissance Technologies, donated $500,000 to pro-Clinton Super PAC Correct the Record.

And Ewa and Dan Abraham, a longtime donor for both Bill and Hillary Clinton, underwrote an endowment to care for the terrace at the State Department where the Patrons of Diplomacy memorial wall hangs.

The patrons campaign also drew on the ranks of Washington’s moneyed society, including those who have a long history of giving to cultural and artistic causes.

One of the co-chairs, philanthropist Adrienne Arsht, is a fixture among Washington’s social scene and a major benefactor of the performing arts. She gave $500,000 to the patrons campaign, qualifying her for “Major Philanthropist” statuts. She also hired a Miami marketing firm with which she does business, Republica, to create that glossy brochure brochure, which was used to pitch other donors.

Arsht, who made her money in Florida banking, also has given the maximum amount allowed to Clinton’s presidential campaign. But she has mostly spent her millions on the city of Miami’s Center for the Performing Arts, the largest in Florida, which bears her name, as well as on major donations to New York’s Lincoln Center and the Metropolitan Opera. Last Saturday, Arsht attended the annual gala for the Washington National Opera, striding confidently in a floor-length blue beaded gown through the hall of the Organization of American States, as members of the city’s arts and philanthropy establishment greeted one of their own.

Arsht is also a preeminent figure in the rarified world of money and society that Clinton herself knows well as a longtime, on-again-off-again resident of the District of Columbia. And the two have socialized together. In July 2012, Clinton attended a small dinner that Arsht hosted at her Washington home for Adm. James Stavridis, the then-commander of U.S. European Command and NATO’s Supreme Allied Commander, and Stavridis’ wife, according to a copy of Clinton’s schedule that was released along with some of the emails she kept on a private server in her New York home.

Another bastion of the Washington philanthropic establishment, David Rubenstein, was also a co-chair of the patrons campaign and gave at least $1 million. (He has given modestly to the Clinton Foundation, between $5,000 and $10,000, records show.) Rubenstein’s passion—some might say mission—is the preservation of American historyand priceless treasures. He personally ponied up half the cost to repair the Washington Monument after it was damaged and closed following a 2012 earthquake, about $7.5 million. And Rubenstein, one of Washington’s few billionaires, lent the State Department a rare 1823 copy of the Declaration of Independence to display in the Diplomatic Reception Rooms. (He has also given an original copy of the Magna Carta that he bought for $21 million to the National Archives, which has a Rubenstein gallery.)

The Daily Beast reached out to several of the top donors to the patrons campaign, including the co-chairs. Rubenstein, the only person to respond, told The Daily Beast that he had been approached to give to the Patrons of Diplomacy campaign, but he didn’t recall by whom.

“There is a long standing program to raise funds to outfit the public rooms at State,” Rubenstein said, noting that the effort first got underway in the early 1960s, when what are now the grand reception rooms were drab, modernist affairs with low ceilings and harsh lighting.

The wife of Secretary of State Christian Herter, who served in the Eisenhower administration from 1959 to 1961, reportedly wept when she first saw the rooms, believing the United States would be humiliated to host heads of state and foreign dignitaries in such a garish venue.

“It looked like a gangster’s molls headquarters on the Twentieth Century-Fox lot,” State Department curator Clement Conger, who is widely credited as the guiding force behind the original plan to remodel the rooms and the subsequent upkeep, told the Christian Science Monitor in 1985. “It was done in completely modern furniture, covered in purple, red, and turquoise, with red at the windows.”

The fundraising campaign that Clinton started, which was overseen by her then chief of protocol, Capricia Marshall, now a close Clinton aide, raised Conger’s efforts to a new level and may ensure that the rooms have a reliable source of funds for years to come. Of the $20.3 million raised, $18 million will be used for preservation and the remainder will pay for efforts to “educate people worldwide about the rooms,” which are open for public tours, according to an article in the State Department’s internal magazine.

But Republicans’ suspicions about Clinton’s fundraising efforts are unlikely to be allayed by the work she did to ensure the rooms’ future. And it’s doubtful that her friends and reliable donors would have given so generously were Clinton not running the State Department.

Article Link to The Daily Beast:

How The West Was Lost

By Carl Bildt
Project Syndicate
May 26, 2016

BRUSSELS – Recent political discourse on both sides of the Atlantic has raised a disturbing question that is becoming increasingly difficult to dismiss: Are the United States and Europe turning away from the policies of openness that have historically driven their economic success?

In the US, Donald Trump, the presumptive Republican nominee for president, is waging verbal war against virtually every trade agreement his country has ever struck. He has threatened to tear up the highly successful North American Free Trade Agreement and pledged to block any attempt to move forward with the recently concluded Trans-Pacific Partnership (TPP).

Should Trump’s views become part of the Republican Party’s platform, the shift will redraw the political landscape regarding free trade. After all, the Republicans have traditionally been the standard-bearers of free trade in the US – in contrast to the Democratic Party, which has had to contend with skeptical voices from the trade unions that make up part of its constituency.

Meanwhile, Trump’s likely opponent in the general election, Hillary Clinton, seems to have folded the flag and adopted at least part of the anti-trade tirades of Trump and her left-wing primary opponent, Bernie Sanders. Suddenly, she has turned against the TPP agreement, despite having supported it previously. She is opposing US President Barack Obama’s tentative plan to have it ratified by Congress immediately after the November election.

This behavior is without precedent. Never before have the leading contenders for the US presidency fueled fears that free trade will undermine America’s prosperity. Whichever candidate prevails in November, the consequences are likely to be serious.

In Europe, the situation is only marginally better. Austria’s entire political spectrum has come out firmly against the proposed Transatlantic Trade and Investment Partnership (TTIP) between the US and the European Union. And public opinion seems to be undergoing a similar shift in Germany, a country that owes its affluence to its success in global markets. Even in the Netherlands, which used to have free trade in its DNA (and would hardly exist without it), vocal campaigners are threatening to hold a referendum to reject any trans-Atlantic trade deal.

Given the history of the West, these are perplexing developments. Europe’s rise began when its ships started to explore the world for new markets and opportunities. This underpinned not only rising wealth, but also innovation. To open up markets, after all, is also to open up minds.

Similarly, in the decades since the end of World War II, the security of the West has been built first and foremost on the economic success of the US, Western Europe, and Japan – success that was driven by integration, trade, and innovation. According to nearly every indicator one can think of, the remarkable growth in trade during the past quarter-century has given mankind some of its best decades ever.

That is why it’s impossible to imagine achieving ambitious global development goals without placing free trade and globalization at the center of the strategy. If the West, losing faith in itself, turns away from the very practices that made it successful, where does that leave poor and developing countries?

Fortunately, all is not yet lost. But rescuing the West’s trade agenda will require exceptional leadership and perseverance. This will be a decisive year. The trade agreements involving the US, Asia, and Europe are important not just in terms of traditional goods, but also in terms of the free flow of data. While trade in physical goods is showing signs of stagnation, data flows have increased by a factor of 45 during the last decade.i

If Obama can ensure the ratification of the TPP and bring the TTIP negotiations to a conclusion, he will have laid the groundwork for future progress. If he falls short on either task – or, catastrophically, fails on both – the world will face a far more uncertain future.

Political leaders who still believe in the West must dedicate themselves to the defense of free trade and the construction of an ever more open world. They must do everything they can to prevent the introduction of protectionist measures and the erection of barriers to globalization.

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Thursday, May 26, Morning Global Market Roundup: Oil Prices Top $50, Asian Shares Struggle As China Sags

By Hideyuki Sano
May 26, 2016

Brent crude oil rose above $50 a barrel for the first time in nearly seven months on Thursday but Asian shares struggled to gain traction, with worries about U.S. interest rates and China's slowing economy keeping investors on the sidelines.

While energy stocks outperformed, a slump in mainland China stocks to 2-1/2 month lows dampened any broader interest in riskier assets in Asia, offsetting overnight gains on Wall Street.

"The market environment is not bad overall. Oil prices are rising, which would benefit oil producing countries. But Asia may be hurt by concerns about the Chinese economy," said Shuji Shirota, associate director at HSBC in Tokyo.

"The market's focus is returning to the Fed, given rising expectations that they could hike rates much earlier than expected. That is weighing on many emerging markets as well," he said.

European shares are expected to fall slightly, with financial spreadbetters seeing Britain's FTSE 100 and Germany's DAX to open down 0.2 percent.

Japan's Nikkei rose just 0.1 percent while MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.2 percent, struggling to extend its rebound from Tuesday's 12-week low. It had gained 1.2 percent on Wednesday.

Shanghai shares fell more than 1 percent at one point, with sentiment frail after a series of disappointing economic data earlier this month and fears that policymakers may be taking a more cautious stance on further stimulus as debt levels grow.

Share prices rallied globally overnight, led by European banks, which benefit from a decision by euro zone finance ministers to unlock new funds for Greece and to give it a firm offer of debt relief.

On Wall Street, U.S. S&P 500 Index rose around 0.7 percent to 2,091, its highest in almost a month and near its six-month intraday high of 2,111.

Energy stocks outperformed on the back of a continued recovery in oil prices, which hit seven-month highs after the U.S. government reported a larger-than-expected drop in crude inventories. [O/R]

Global benchmark Brent futures rose 34 cents or about 0.6 percent to as high as $50.14 per barrel, the highest level since early November. U.S. West Texas Intermediate (WTI) hit $49.93, a seven-month high.

"Geopolitical issues in West Africa and the Middle East, supply outages, increased demand and maybe a touch of a weaker dollar have all helped push prices higher," said Jonathan Barratt, chief investment officer at Sydney's Ayers Alliance.

"I don't think the rally will last because prices will reach a level that will bring U.S. shale oil output back into the market," he added.

The rally in U.S. and European shares came even as investors readied themselves for monetary tightening by the U.S. Federal Reserve as early as next month.

The yield on two-year U.S. notes rose to a 10-week high of 0.938 percent on Wednesday as investors priced in the likelihood of the Fed raising its federal funds target rate to 0.50-0.75 percent from the current 0.25-0.50 percent in coming months.

It last stood at 0.903 percent, almost a quarter percentage point above this month's low of 0.686 percent.

Market players are awaiting comments by Fed Chair Janet Yellen at a Harvard University event on Friday, though many also say her speech scheduled for June 6 - after new U.S. payrolls data comes out - would be even more crucial.

Recent comments by Fed policymakers have put a possible rate hike this summer firmly on the table for discussion, but U.S. interest rate futures <0> are still pricing in only about one-third chance of a rate hike in June and about a 60 percent likelihood by July.

The prospects of higher U.S. interest rates undermined the attraction of gold, which fell to a seven-week low of $1,217.90 per ounce though it came back up a tad in Asia to trade at $1,228.

In the currencies, sterling rose to $1.4706, near its four-month peak of $1.4770 hit earlier this month, as several bookmakers widened the odds on a British "Brexit" from the European Union after opinion polls showing the "in" camp leading. [GBP/]

The dollar was generally supported by U.S. rate hike expectations, while the euro stood at $.1151, having hit a 10-week low of $1.1129 overnight.

But it saw a 0.5 percent loss against the yen to 109.64 yen in an erratic move.

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