Thursday, September 15, 2016

Europe Reaches For Reset

With leaders gripped by fear of losing elections, Donald Tusk’s hopes of a ‘pivotal’ summit risk being disappointed.


By David M. Herszenhorn
Politico EU
September 15, 2016

As EU leaders survey the state of Europe from a hilltop castle in Bratislava on Friday, they won’t like what they see: a splintering Continent, beset by populism.

Brussels hopes this summit will change the narrative, but merely gathering 27 presidents and prime ministers under one roof may turn out to be its biggest achievement — and even then, Britain’s absence will illustrate the depth of discord.

The Brexit vote in June created an urgent need for solidarity against a Euroskeptic barrage, but the political imperatives of individual leaders facing reelection fights seem increasingly at odds with the “ever closer union” envisioned in the Treaty of Rome.

Donald Tusk, the European Council president, hopes to restore confidence by rallying leaders behind a tightly focused agenda: to manage the migration crisis by strengthening border controls, enhancing cooperation on internal and external security, and to take steps — somewhat less clear — to prop up the sluggish economy.

In his State of the Union speech on Wednesday, European Commission President Jean-Claude Juncker said he had never seen Europe’s leaders so fractured, or so inwardly focused, which underscores how difficult it will be to achieve even limited goals in coming weeks and months.

“Never before have I seen such little common ground between our member states, so few areas where they agree to work together,” he said. “Never before have I seen national governments so weakened by the forces of populism and paralyzed by the risk of defeat in the next elections.”

“For the first time in decades, senior European leaders have actually envisioned publicly the possibility of the disintegration and collapse of the European Union” — Michael Leigh, senior fellow at the German Marshall Fund

The absence of the U.K. and its new prime minister, Theresa May, imposes limitations on the summit: nothing that is said or done will be legally binding, making it little more than a high-level public relations exercise.

In Brussels, officials worked aggressively to set modest expectations, portraying it as the start of a post-Brexit reassessment and noting that more concrete steps will be taken at regular summits in Brussels in October and December, including a review of relations with Russia, and culminating next year in Italy at a celebration of the 60th anniversary of the Treaty of Rome.

“We just had one of our member states who decided to leave, we cannot just pretend that this was nothing and get on with it,” said one EU official involved in the summit planning.

Possible Collapse

“For the first time in decades, senior European leaders have actually envisioned publicly the possibility of the disintegration and collapse of the European Union,” said Michael Leigh, a senior fellow at the German Marshall Fund and a former director-general for enlargement at the European Commission.

“People are asking the question: Will the European Union survive for the next decade?” added Leigh. “The fact that the 27 should get together following the Brexit referendum and express a common determination to reinforce the European Union is in itself positive.”

If the bar is set that low, Tusk seems certain to succeed, though he has higher aspirations, laid out in a “Dear colleague” letter this week that amounts to a four-and-a-half-page call to action.

The Council’s Polish president exhorted national leaders to recognize Brexit as evidence of broader doubts among citizens, and he urged them to make Bratislava a pivot point.

“People in Europe want to know if the political elites are capable of restoring control over events and processes which overwhelm, disorientate, and sometimes terrify them,” Tusk wrote.

The two most important messages, according to the EU official involved in the planning, are that the remaining 27 members “intend to stay in the EU and make it a success,” and that they need to address people’s feeling of insecurity. However, officials said they were bracing for inevitable disagreement and that Friday’s meeting was unlikely to produce a blueprint for addressing these challenges.

Don’t Rock The Boat

Preventing open squabbling among the leaders in Slovakia is another challenge, against the backdrop of old tensions within Europe — between West and East, North and South, Right and Left — repeatedly erupting on a broad spectrum of issues, including migrants, fiscal policy and military cooperation.

On some issues, clear factions have emerged. Greek Prime Minister Alexis Tsipras convened the so-called Club-Med group of Southern tier nations in Athens, where some leaders lashed out at the austerity policies championed by Germany and other Central and Northern countries.

On other issues, the disagreements have been more emotional: Luxembourg’s foreign affairs minister, Jean Asselborn, said in an interview published Tuesday that Hungary should be expelled from the EU for treating migrants almost like “wild animals.”

Even Tusk, criss-crossing Europe to meet leaders ahead of Friday’s meeting, gave in to the temptation to vent on a stopover in his native Poland, where he rebuked critics of the EU during a meeting with Prime Minister Beata Szydło.

Szydło, clearly aiming her remarks at a domestic audience, said she had conveyed pointed demands for sweeping reforms of the EU, echoing recent talk in Poland and Hungary about a heavy rewrite of the Treaty of Rome as it celebrates its 60th anniversary next year.

Tusk hit back with remarks that underscored his fears about lack of cohesion among EU leaders, saying he had encouraged the Polish government “to treat Europe as something that’s worth being taken care of, not attack and question.”

“It’s important that Poland doesn’t join those who want to rock the EU boat. We need an EU that is stable, strong and as united as possible,” he said.

Playing For Time

“In Tusk’s eyes, the purpose of the meeting is to bring back stability and hope to the Union shaken by many crises,” a senior EU official said.

His biggest challenge, however, is the political context: some of Europe’s most prominent figures risk losing their jobs in coming elections, including in France and Germany. Those in the strongest position, like Hungary’s Viktor Orbán, are often sharply critically of the EU.

Through one lens, the precariousness of the European Union could be viewed as synonymous with the predicament of German Chancellor Angela Merkel, who has struggled to balance her instinct to lead with an emphasis on Western values, against a backlash from voters at home, where her conservative party just took a drubbing in regional elections.

“In a way we are all playing for time, which is not very good under the present circumstances” — Veteran EU diplomat

According to one veteran EU diplomat, leaders are just “looking at the next electoral deadline, whether it is elections in Germany or France or Italy and the rest. Everybody sits at the table and the only thing he or she has in mind is ‘What can I get from here to prove to my public opinion that I am the best, that I am doing what they are asking me to do.’”

“In a way,” the diplomat added, “it is the general problem of the European Union these last few years. The problem is how to reconcile your own views and the general interest.”

The gains by the far-right Alternative for Germany party are just one example of the challenges traditional parties are facing from insurgent political factions on the Right and Left. Propelled by anti-establishment fervor, they have the luxury of campaigning against politics-as-usual without having ever borne the responsibility of governing.

“I don’t think you have today in any of the member states any serious politician who believes he or she could win an election by saying what we need is more Europe,” said Michael Leigh.

Outside Brussels, there was a similar sense that the main purpose of the Bratislava gathering would be to lift morale and begin a longer process of reflection and collaboration, according to senior European diplomats in Berlin and other capitals, even as some leaders viewed Tusk’s letter as excessively bleak.

Germany in particular has been working in recent days to open new lines of communication including between states where there had been little previous engagement outside formal settings.

And some German officials viewed the effort to prepare for Bratislava, including meetings with the French to develop a joint proposal on enhanced European military cooperation, as perhaps even more useful than Friday’s heavily stage-crafted meeting, the diplomats said.

Tusk, reflecting a view shared by Merkel, has said the short-term answer should be modest but concrete deliverables to show voters the EU adds value, such as stepping up security along Bulgaria’s border with Turkey, and imposing new, coordinated traveler screening programs to identify and intercept potential terrorists.

But it is far from clear those steps will be sufficient to change public opinion. And many of the forces battering Europe seem largely beyond the control of political leaders and institutions.

And some officials said there was a risk that the Bratislava summit would meet the low expectations set by Brussels, and ultimately not prove a turning point.

“I am not expecting that Bratislava will be a sort of dividing line,” the veteran EU diplomat said. “For the moment, Germany has decided not to rush into anything. So essentially it will be a sort of standstill. In a way we are all playing for time, which is not very good under the present circumstances.”


Article Link To Politico EU:

George Will: Putin’s Post-Factual Politics

Our would-be presidents would do well to remember the sinister roots of Putin’s regime.


By George Will
The National Review
September 14, 2016

“In the walls of the cubicle there were three orifices...Similar slits existed in thousands or tens of thousands throughout the building...For some reason they were nicknamed memory holes.” -- George Orwell, 1984

Documents inconvenient to the regime went into the Ministry of Truth’s slits and down to “enormous furnaces.” Modern tyrannies depend on state control of national memories — retroactive truths established by government fiat. Which is why Russia’s Supreme Court recently upheld the conviction of a blogger for violating Article 354.1 of Russia’s criminal code.

This May 2014 provision criminalizes the “Rehabilitation of Nazism.” The blogger’s crime was to write: “The communists and Germany jointly invaded Poland, sparking off the Second World War.” The secret protocols of the Molotov-Ribbentrop Pact have gone down one of Vladimir Putin’s memory holes.

The pact was signed August 23, 1939. On September 1, Germany invaded Poland. Sixteen days later, the Soviet Union invaded from the east. Poland was carved up in accordance with the secret protocols, and about six months later Soviet occupiers were conducting the Katyn Forest Massacre of 25,700 Polish military officers, officials, priests, and intellectuals.

Although in 2009 Putin denounced the pact as “collusion to solve one’s problems at others’ expense,” in 2015 he defended it as Stalin’s means of buying time to prepare for the Nazi onslaught. This fable is refuted by, among other facts, this: Stalin did not prepare. When Germany’s ambassador in Moscow informed Foreign Minister Vyacheslav Molotov that their nations were now at war, a stunned Molotov asked, “What have we done to deserve this?”

The Russian Supreme Court’s Orwellian ruling was that the blogger denied facts established by the Nuremberg war-crimes tribunal. It convicted leading Nazis of waging aggressive war against, among others, Poland, but, in an act of victors’ justice, made no judgment against the Soviet regime, representatives of which sat on the tribunal. This accommodation to postwar political reality was necessary to enable the tribunal to function, which was necessary for civilizing vengeance. The tribunal ignored, but did not deny, the patent fact of Soviet aggression.

The Russian court’s ruling is a window into the sinister continuity of Putin’s Russia and the Soviet system that incubated him. So, if the former secretary of state who aspires to the American presidency has time to read a book before January 20, she should make it The New Tsar: The Rise and Reign of Vladimir Putin by Steven Lee Myers of the New York Times. It is a study of the volatile nostalgia of a man seething with resentments acquired as a KGB operative — a “devoted officer of a dying empire” — during the Soviet Union’s final years. It is a pointillist portrait painted with telling details that should cause sobriety to supplant dreams of happy policy “resets” with Russia:

As a senior security official in post-Soviet Russia, Putin kept on his desk a bronze statue of “Iron Felix” Dzerzhinsky, founder of the Soviet secret police and terror apparatus. At Putin’s May 7, 2000, presidential inauguration, a choir sang a composition “written in 1836 to celebrate a soldier’s death in the war against Poland and rewritten in Soviet times . . . to remove the homage to the tsar. For Putin, the choir sang the Soviet verses.” There was the 2006 assassination in Moscow, on Putin’s 54th birthday, of the troublesome journalist Anna Politkovskaya. (Asked about the frequent deaths of anti-Putin journalists, Donald Trump breezily said, “I think our country does plenty of killing.”) And the 2006 poisoning in London of Putin’s antagonist Alexander Litvinenko using radioactive polonium-210.

Domestically, Putin’s “managed democracy” is Stalinism leavened by kleptomania, as in the looting of the energy giant Yukos. In foreign policy, Putin’s Russia is unambiguously and unapologetically revanchist. The Soviet Union was likened to a burglar creeping down a hotel corridor until he finds an unlocked door. Putin, who found Crimea unlocked (when he honeymooned there in 1983, it seemed “a magical, sacred place to him,” writes Myers), is pushing on the door of what remains of Ukraine.

The Democratic presidential nominee fundamentally misread Putin’s thugocracy, and her opponent admires the thug because “at least he’s a leader.” As the Russian blogger’s fate demonstrates, Putin practices what Orwell wrote: “‘Who controls the past,’ ran the Party slogan, ‘controls the future: who controls the present controls the past.’”

Back in the day, some analysts prophesied a “convergence” between the Soviet Union and the United States, two industrial societies becoming more alike. In our day, there is indeed a growing similarity: In both places, post-factual politics are normal.


Article Link To The National Review:

Why Kerry’s Syria Cease-Fire Is Already Failing

By Benny Avni
The New York Post
September 15, 2016

Another one of Secretary of State John Kerry’s “Hail Mary” diplomatic deal is well on its way to collapsing, this time in Syria.

A seven-day cease-fire was supposed to start Monday across Syria, under an agreement signed last week by Kerry and his Russian counterpart, Sergei Lavrov. Multiparty talks to end the war were to follow.

But fire is yet to cease, though attacks have diminished in parts of the country. The lull in the half-decade-old civil war wasn’t enough, however, to launch the main task of the week.

The United Nations was to start delivering humanitarian aid to civilians in long-besieged towns, like Aleppo. And “We made everything ready,” UN Secretary-General Ban Ki-moon told reporters Wednesday. But aid convoys hadn’t yet moved because, as one UN source told me. “We’re still waiting for necessary approval from all sides.”

Neither the Russian-backed Syrian government (which is imposing the Aleppo siege) nor its opponents will guarantee aid workers’ safety while they deliver food, medicine and shelter to besieged women, children and the elderly. Those Syrians are yet to benefit from last week’s amicable Kerry-Lavrov handshake.

Even Kerry himself, reportedly, was skeptical the deal would work. But he signed it anyway because, well, you got to do something, right?

And while the first stage is off to an iffy start, the deal will get even wobblier next week. That’s when America and Russia are scheduled to start sharing intelligence on the fight against ISIS & Co. It’s a crucial part of the Kerry-Lavrov deal — and one the Pentagon strongly opposes.

The New York Times reports that Defense Secretary Ash Carter is unenthusiastic about handing the Kremlin details about the anti-regime rebels America supports. After all, Syrian President Bashar al-Assad and his Russian patrons have never been that interested in fighting ISIS. Assad, in fact, is complicit in its growth.

Instead, the Russians and Assad’s other allies (mainly Iran and Hezbollah) are most interested in squashing any legitimate alternative to the Damascus butcher, including the groups America has tried to cultivate since the war began.

But like Kerry, President Obama is wedded to an old diplomatic cliché: “There’s no military solution” to the Syrian war. So the president backed Kerry over the Pentagon’s protest, and a diplomatic deal that deepens the Russian-Iranian stronghold on Syria was signed.

Except that, in reality, there’s no diplomatic solution for Syria. At least not at this stage.

As long as Assad remains in power, drawing the ire of the country’s Sunni majority, the fighting will go on. As Obama and Kerry used to say (before they capitulated to Moscow), Assad long ago lost legitimacy as Syria’s ruler.

Yet Assad won’t leave as long as major powers on the ground back him. Meanwhile, everyone insists Syria must remain a unified country.

Unless outsiders come up with a viable partition plan or, less drastically, a proposal to create a loose confederation among Syria’s factions, they’ll keep fighting each other, and their backers will egg them on. Just look at Iranian Foreign Minister Javad Zarif’s op-ed in Wednesday’s New York Times, calling to “rid the world” of Saudi-backed extremism. (What did the pot call the kettle?)

Since 2011, when the Syrian civil war erupted, Obama has essentially acted as if it’s not our problem. In came Russian President Vladimir Putin, who’s turning Syria into a Russian Mediterranean outpost.

Putin’s goals there are blatantly at odds with ours — indeed, one of his chief objectives is to stick it to America.

If America indeed has no skin in the Syrian game, as Obama seems to believe, we should steer clear of peacemaking there. As Russia learned in the 1990s, if you aren’t a real world power, you can’t play one on TV. And you can’t dictate peaceful solutions to a war from the sidelines.

In fact, we do have an interest in today’s most consequential Mideast contest. So the next president will have to walk away from Kerry’s futile deal-making, and listen to the hawks advocating a more muscular approach in Syria. There’s plenty of space between a large ground-force invasion and outsourcing the Syrian war to Putin.

This week, Obama chided Donald Trump, suggesting he’d do Putin’s bidding around the globe. Too bad John Kerry, in Syria at least, is already doing exactly that.


Article Link To The New York Post:

Why It’s Impossible For Democrats To Win The House

In 2010, Republicans successfully redrew district lines to rig House elections in their favor. One leading redistricting expert says the problem is even worse than we think.


The Daily Beast
September 15, 2016

Even if Hillary Clinton pulls off an electoral landslide, and even if the Democrats flip the Senate, Republicans are likely to hold onto the House, where they hold a 247-188 majority.

In large part that’s because the House districts were gerrymandered in 2010 by Republican-controlled state legislatures, part of the brilliantly effective campaign known as REDMAP. This fact, not ‘gridlock’ or ‘partisanship,’ is why the 114th Congress has accomplished so little (and can’t even pass emergency funding to fight Zika). The House is rigged.

Gerrymandering has been going on since the beginning of the republic – the word itself dates to a 1812 redistricting effort by Massachusetts Governor Elbridge Gerry, which included districts so convoluted that one looked like a salamander.

But 2010 was different.

First, in the wake of their 2008 electoral losses, Republican activists poured unprecedented amounts of money into the 2010 state legislative elections, particularly in blue or swing states, particularly at the tail end of the election cycle. They made huge gains in Pennsylvania, Ohio, Florida, Michigan, Wisconsin, and North Carolina.

Why focus on the states? Because 2010 was a census year, and in most states, state legislatures draw the boundaries of congressional districts. The strategy worked: in 2011, Republicans redrew four times as many districts as Democrats did.

Next, the same group of activists used the new technologies of Big Data to analyze voting patterns and design districts to “pack or crack” Democrats – either crowding them into a few districts, or diluting them across several.

Nathaniel Persily, a Stanford University professor who has served as a court-appointed nonpartisan redistricting effort expert in four different states, told the Daily Beast that “the 2010 redistricting process couldn’t have come at worse time for Democrats,” Persily told the Daily Beast. “That year was the Tea Party election, sweeping Republicans into control of state legislatures. They were in the driver’s seat to draw lines, so they took advantage of it.”

Salon’s David Daley, author of Ratf*cked: The True Story Behind The Secret Plan To Steal America's Democracy, called it “Moneyball applied to politics.”

The results were astounding.

In 2012, for example, Democrats running for House seats got 1.3 million more votes than Republicans – but the minority-elected Republicans maintained a 234-201 majority in the House. In Ohio, where President Obama won the election, Republicans outnumbered Democrats in the congressional delegation by 12 to 4. In Pennsylvania, another Obama-voting state, the margin was 13 to 5.

And in 2014, Republicans got 52% of House votes, but 57% of House seats.

Ironically, thanks to REDMAP, the House of Representatives is designed to be unrepresentative. At least until 2020, it is engineered to elect Republicans.

Persily, however, said the problem runs deeper than just gerrymandering.

First, he said, population patterns play an equally important role. “The elephant in the room is that Democrats aren’t efficiently dispersed in the population as Republicans, because Democrats are concentrated in cities. So even if you had compact districts, you’d end up having a Republican bias.”

No matter how much attention is spent on congressional redistricting, those population patterns aren’t likely to change any time soon.

Second, there’s no obvious way to draw districts because of the Voting Rights Act. Suppose a state simply drew a grid, for example. This might sound appealing, but it would also have the effect of diluting minority populations into majority-white districts. That would violate the VRA.

On the other hand, Persily said, that’s exactly what Republicans did in 2010. “There have been lots of challenges brought by Democrats and civil rights groups alleging that Republicans used race to pack African Americans and Latinos into inefficient districts.” Challenges have prevailed in Alabama, North Carolina, and Virginia.

“It’s the Goldilocks Principle of redistricting,” Persily explained. “You have to take race into account, but not too much.”

Was 2010 really worse than other gerrymandering efforts, though?

“The tools are different,” Persily said, “but the motivations remain the same.” Persily pointed out that Democrats gerrymandered extensively in 2000, but now “the technology is more sophisticated, the data much more granular than historically.”

Moreover, recent elections have been closer than in the past. “Remember, for a hundred years, the South was so solidly Democratic that it didn’t matter what the gerrymanders did… Now, the House could swing one way or the other, so a thumb on the scale can make a difference.”

Is the House hopeless, then? Is there nothing that proponents of fair elections can do, except wait until 2020, when the Democrats will try to be as conniving as the Republicans were in 2010?

There have been some encouraging developments.

First, there are cases in the pipeline now arguing that highly partisan gerrymandering is, itself, unconstitutional. (Ironically, one of these involves a gerrymander by Democrats, in Maryland.) The Supreme Court has thus far split on the issue – in one case, they announced six different standards of review – but Persily pointed out that an additional left-leaning justice could bring about consensus.

“These are big constitutional issues – and all of this could change,” he said. “Partisan gerrymandering, race and redistricting, voter rights and voter ID, campaign finance – all of these hinge on one vote.”

Second, independent redistricting commissions got a big boost earlier this year when the Supreme Court upheld Arizona’s commission, despite explicit language that the “legislature” is to draw districts. That case, plus the success of independent commissions in California, offers another way forward.

Third, as the situation becomes more and more egregious, audacious reform proposals such as “cumulative voting” – in which larger districts vote for multiple representatives, allowing more proportional representation – may begin to be seriously considered. And there are various proposals for changing the principles of redistricting to prohibit partisan considerations, for example, or favor compact districts.

Finally, the Republican gerrymander may collapse under its own weight. The “crack” part of “pack and crack” has scattered minority voters into majority-white districts. But this year, some of those white-elected Republicans may be vulnerable, thanks to Donald Trump. In other districts, REDMAP has made elections so safe for Republicans that it’s empowered the Freedom Caucus, the Tea Party, and other hard-right groups to take down establishment candidates.

In other words, Republicans may have gotten more than they bargained for.

Yet despite all of these developments, Persily remained pessimistic. “Whatever reform is proposed, it’s full employment for lawyers: what does compactness mean, what about the Voting Rights Act…. The fact is, courts have become permanent players in the redistricting process.”

If nothing changes, the 115th Congress is likely to look a lot like the 114th: even if the Democrats take the Senate, nothing President Clinton proposes will likely make much headway in the House. That won’t be because of gridlock, or “the system” in general. It will be because of a deliberate Republican strategy. It will be because the House has been rigged.

Even if Hillary Clinton pulls off an electoral landslide, and even if the Democrats flip the Senate, Republicans are likely to hold onto the House, where they hold a 247-188 majority.


Article Link To The Daily Beast:

Bill Clinton Is No Longer The Closer

Democrats say the former president is not the campaign surrogate he used to be.


By Annie Karni
Politico
September 15, 2016

Bill Clinton’s chief of staff, Tina Flournoy, was home working Sunday evening when Huma Abedin called with an urgent request: Could the former president drop his upcoming meetings in Washington, and take over for his pneumonia-felled wife on the campaign trail.

The answer was, of course, yes: The former president filled in at three fundraisers in California on Tuesday and at a rally in northern Las Vegas on Wednesday. While his wife rested in Chappaqua, New York, he tried to make her case that the country has “to vote for the only person with a credible economic plan.”

In the eyes of his most stalwart defenders, the last-minute sub was an example of the age-old Clinton two-for-one: “He can do something as a surrogate no Trump supporter can do: explain why she’s qualified for the job,” said former Clinton spokesman Matt McKenna. “If Gov. [Chris] Christie lives to be 1,000 years old, he’ll never know what it’s like to be president.”

But with eight weeks to go and Hillary Clinton’s lead slipping, some of her allies have begun to question how much the campaign should lean on him and how bright his legacy star power still is.

“We need to hear directly from the candidate at this point in the election,” a longtime Clinton ally and Democratic National Committee member, said. “It’s nice to have him, but the only real surrogate who works at this point is President Obama.”

Indeed, Democratic operatives cast Clinton’s husband as a second-tier stand-in for the candidate — of less value than President Barack Obama and first lady Michelle Obama. He still has a 53 percent approval rating, according to a recent poll, and can speak to broad swaths of the electorate. But in some of the swing states where campaign operatives are putting in asks for big-name Democrats to visit, Bill Clinton comes in about even with Joe Biden and Tim Kaine, followed by Elizabeth Warren and Bernie Sanders, Democratic operatives say. He’s seen as a highly effective rainmaker with donors, but less useful than the reigning leaders of the party at rallies and among voters.

The value of the Obamas as surrogates also rises because they are scarce commodities on the campaign trail. Bill Clinton, by contrast, is an easier get, with a weaker case to make: He has traveled to more than 40 states and territories, and headlined more than 400 public events for his wife this year.

“When you see Bill Clinton, the first thing you think of is not Hillary, it’s not tomorrow — it’s the former president and yesterday,” said the DNC member. “He can go and raise money, but in terms of what she is going to do as president — she needs to be making that case. I’m voting for Hillary. I’m not voting for Bill.”

Bill Clinton carried 32 states, plus the District of Columbia, in 1992 and again in 1996 — and he still loves campaigning. But there is a growing distance between Clinton’s presidency and the electorate, and unlike eight years ago, he’s no longer the last Democrat to sit in the Oval Office. The last time he ran for office was 20 years ago, which means anyone younger than 38 never even cast a vote for him.

And that can be frustrating to the longtime Democratic closer.

After her 2008 loss, the Clintons decided to make the former president a workhorse, not a show horse this time around, toiling in the background of the Hillary show. This cycle, “he’s toned down his speeches, he’s toned down his political insight, he sticks to the talking points — he does everything he can not to make news,” said Garry Mauro, a longtime friend of the Clintons and current Texas state director.

But this backseat role has not always been comfortable for a hands-on political animal. The former president, according to an ally familiar with his thinking, has become increasingly “frustrated with the fact that the campaign is based on analytics, with not enough attention to message” as the polls tighten.

And he seems more energized when the spotlight is on him. During the Clinton-Kaine bus tour following the Democratic National Convention in July, for instance, the former president struggled to keep his eyes open as he sat silently next to Anne Holton, to the side of a podium at the K’NEX Brands toy manufacturing company in Hatfield, Pennsylvania.

Wednesday’s rally at the College of Southern Nevada’s Cheyenne campus was Bill Clinton’s shot at driving a message with all cameras focused on him. “We need to live together, we need to protect women’s rights, labor rights, LGBT rights,” he said, pacing behind the “Stronger Together” podium that had been prepared for his wife. “We need to get over all these crazy divisions — that’s Hillary’s vision, that’s what ‘Stronger Together’ means.”

He looked energetic on stage for 40 minutes, hitting the talking points about his wife’s plans to encourage long-term investment and install solar panels to combat climate change, and whacking her opponent.

But he also waxed nostalgic, reminding the crowd of the “surplus budget” he left for his successor in 2000, and how he worked with former Sen. Tom Harkin to “change the Medicaid law so that a person with a disability could go to work and not lose his Medicaid.”

There also were signs of the physical setbacks that are part and parcel of his own advancing age. When a woman called out with a question while he was speaking on stage, Clinton, 70, responded, “I’m hard of hearing, so I’ll never be able to hear what you said.” He also didn’t escape the appearance without any missteps, downgrading his wife’s ailment from pneumonia to a more workaday flu: “It’s a crazy time we live in. You know, when people think there’s something unusual about getting the flu. Last time I checked, millions of people were getting it every year.”

With Hillary Clinton set to return to the campaign trail Thursday, Democrats said they hope Bill Clinton subbing in for his wife is viewed more as a human moment than a long-term political strategy: simply an example of a supportive spouse doing his part.

And even if hearing from a former president is not the same as getting a real sense of the current candidate, he is still a celebrity who can draw a crowd.

Paparazzi shooting Sofia Vergara shopping at Saks Fifth Avenue in Beverly Hills Tuesday afternoon ditched the television star and scrambled to Alfred Coffee & Kitchen, after hearing that Clinton was on the premises, ordering a decaf Americano.

“Bill Clinton? I’m out,” said paparazzo Vladimir Labissiere, who biked over to capture an image of the former leader of the free world pressing the flesh and talking coffee production in Haiti. “This was the best shot of the day.”


Article Link To Politico;

Bill Clinton Is No Longer The Closer

Les Déplorables

Hillary Clinton names the five phobias of Donald Trump’s political supporters.


By Daniel Henninger
The Wall Street Journal
September 15, 2016

Hillary Clinton’s comment that half of Donald Trump’s supporters are “racist, sexist, homophobic, xenophobic, Islamophobic”—a heck of a lot of phobia for anyone to lug around all day—puts back in play what will be seen as one of the 2016 campaign’s defining forces: the revolt of the politically incorrect.

They may not live at the level of Victor Hugo’s “Les Misérables,” but it was only a matter of time before les déplorables—our own writhing mass of unheard Americans—rebelled against the intellectual elites’ ancien régime of political correctness.

It remains to be seen what effect Hillary’s five phobias will have on the race, which tightened even before these remarks and Pneumonia-gate. The two events produced one of Mrs. Clinton’s worst weeks in opposite ways.

As with the irrepressible email server, Mrs. Clinton’s handling of her infirmity—“I feel great,” the pneumonia-infected candidate said while hugging a little girl—deepened the hole of distrust she lives in. At the same time, her dismissal, at Barbra Streisand’s LGBT fundraiser, of uncounted millions of Americans as deplorables had the ring of genuine belief.

Perhaps sensing that public knowledge of what she really thinks could be a political liability, Mrs. Clinton went on to describe “people who feel that the government has let them down, the economy has let them down, nobody cares about them . . . and they’re just desperate for change.”

She is of course describing the people in Charles Murray’s recent and compelling book on cultural disintegration among the working class, “Coming Apart: The State of White America, 1960-2010.” This is indeed the bedrock of the broader Trump base.

Mrs. Clinton is right that they feel the system has let them down. There is a legitimate argument over exactly when the rising digital economy started transferring income away from blue-collar workers and toward the “creative class” of Google and Facebook employees, no few of whom are smug progressives who think the landmass seen from business class between San Francisco and New York is pocked with deplorable, phobic Americans. Naturally, they’ll vote for the status quo, which is Hillary.

But in the eight years available to Barack Obama to do something about what rankles the lower-middle class—white, black or brown—the non-employed and underemployed grew. A lot of them will vote for Donald Trump because they want a radical mid-course correction. Which Mrs. Clinton isn’t and never will be.

This is not the Democratic Party of Bill Clinton. The progressive Democrats, a wholly public-sector party, have disconnected from the realities of the private economy, which exists as a mysterious revenue-producing abstraction. Hillary’s comments suggest they now see much of the population has a cultural and social abstraction.

To repeat: “racist, sexist, homophobic, xenophobic, Islamophobic.”

Those are all potent words. Or once were. The racism of the Jim Crow era was ugly, physically cruel and murderous. Today, progressives output these words as reflexively as a burp. What’s more, the left enjoys calling people Islamophobic or homophobic. It’s bullying without personal risk.

Donald Trump’s appeal, in part, is that he cracks back at progressive cultural condescension in utterly crude terms. Nativists exist, and the sky is still blue. But the overwhelming majority of these people aren’t phobic about a modernizing America. They’re fed up with the relentless, moral superciliousness of Hillary, the Obamas, progressive pundits and 19-year-old campus activists.

Evangelicals at last week’s Values Voter Summit said they’d look past Mr. Trump’s personal résumé. This is the reason. It’s not about him.

The moral clarity that drove the original civil-rights movement or the women’s movement has degenerated into a confused moral narcissism. One wonders if even some of the people in Mrs. Clinton’s Streisandian audience didn’t feel discomfort at the ease with which the presidential candidate slapped isms and phobias on so many people.

Presidential politics has become hyper-focused on individual personalities because the media rubs them in our face nonstop. It is a mistake, though, to blame Hillary alone for that derisive remark. It’s not just her. Hillary Clinton is the logical result of the Democratic Party’s new, progressive algorithm—a set of strict social rules that drives politics and the culture to one point of view. A Clinton victory would enable and entrench the forces her comment represents.

Her supporters say it’s Donald Trump’s rhetoric that is “divisive.” Just so. But it’s rich to hear them claim that their words and politics are “inclusive.” So is the town dump. They have chopped American society into so many offendable identities that only a Yale freshman can name them all.

If the Democrats lose behind Hillary Clinton, it will be in part because America’s les déplorables decided enough of this is enough.


Article Link To The Wall Street Journal:

The Child-Care Bidding War

Clinton and Trump compete to make day care more expensive.


By Review & Outlook
The Wall Street Journal
September 15, 2016

Most days the presidential campaign turns on insults, not white papers, but there will be policy consequences. One example is child care, with both candidates offering multiple subsidies for raising kids. This will end up raising prices and it won’t address the real reason parents feel squeezed: a decade of slow or no economic growth.

Donald Trump on Tuesday proposed a tax deduction that would let families write off the average cost of child care for up to four children, among other ideas. Hillary Clinton has already promised to limit care expenses to 10% of income; raises for caretakers; universal pre-K; an increase in the $1,000 per child tax credit; a new program for student parents, and more.

This is a reaction to the public’s sense that day-care prices are skyrocketing. Mrs. Clinton says the cost has increased 25% over the past decade, and Ivanka Trump seems to agree. Groups that favor government intervention like Child Care Aware of America roll out eyebrow-raising averages: In Massachusetts the annual cost for infant care tops $16,000, and nearly $15,000 in New York.

Yet averages are inflated by affluent parents who pay a premium for care that includes French immersion or yoga sessions. A report last year from Chris Herbst at Arizona State University found that prices “have been essentially flat for at least a decade,” and spending for low-income families hasn’t budged. The typical family’s child-care spending has risen 14% since 1990—much more modest than Mrs. Clinton and left-wing outfits claim.

Mr. Trump deserves credit for noting that regulation drives up the cost of care. States set minimums on square feet per child; licensing requirements; ratios for staff-to-children; group sizes. Zoning laws prevent care centers in convenient places such as residential neighborhoods. Regulation also limits options like informal care at grandma’s house or families who share nannies.

These rules are supposedly for the child’s well-being, but a 2015 paper from George Mason’s Mercatus Center notes the weak connection between most mandates and better care. Ratios and rules could certainly be loosened for four-year-olds, who require less intensive care than infants. Yet most barriers are local and state rules, not measures Mr. Trump could eliminate as President.

Mr. Trump first floated his child-care deduction over the summer, and it tanked: Deductions don’t matter for the 45% of households with no income-tax liability. The campaign is now capping the benefit at individuals earning $250,000 and $500,000 for couples, which would still subsidize families who don’t need government help. The write-off would also go to stay-at-home moms.

Here’s the dirty detail: Mr. Trump proposed an up to $1,200 child-care tax rebate for low-income families that would be delivered by expanding the earned-income tax credit. But the credit would inevitably phase out as income increases and disappears at $31,200. The result would be a higher inframarginal tax cliff—when people are discouraged from earning more income because they lose more in benefits than they can gain in wages. This disincentive to advancement is already steep.

Mr. Trump also proposes savings accounts for child care to add to the tax-free destinations for retirement, health care, college and more. This new benefit, worth up to $2,000 a year, would make tax reform more difficult. The government would also match parental contributions at 50% up to $1,000 a year for low-income families. That’s a wonky way of unveiling a new $500 transfer payment.

Then there’s six weeks of paid maternity leave that Mr. Trump says he would guarantee through unemployment insurance. He claims he’ll pay for this by cleaning out fraudulent payments, though this is his funding mechanism for every proposal. Mr. Trump will nonetheless lose the family bidding war with Mrs. Clinton, who wants 12 weeks of paid leave for new mothers and fathers.

Mrs. Clinton raises the Trump offer in every regard, from more Head Start funding to salary support for day-care workers. And if you think care is expensive now, wait until Mrs. Clinton wades in. She likes to say that child care can be more expensive than college tuition, which is false. The irony is that her day-care blowout would recreate what has made college notoriously expensive—large subsidies for the provider and buyer. Day-care centers and pre-Ks could raise prices, confident that government will cover the increase.

This subsidy race is politically lamentable. Republicans are focusing on redistributing income rather than growing it, which should be their best argument this year. They are also conceding that the federal government should pick favorites in the tax code, which hurts the GOP’s credibility for nixing handouts for, say, Elon Musk. And none of this will cure what really feeds parental anxiety, which is the meager income gains in the Obama economy.


Article Link To The Wall Street Journal:

The Robots Aren't Here Yet

By Mihir Sharma
The Bloomberg View
September 15, 2016

One of the most striking ways in which Narendra Modi’s government has changed the policy narrative in India is to make manufacturing central to its ambitions. This is an overdue recognition of the fact that India -- whose workforce is overwhelmingly poor and underemployed, and growing at the rate of a million people every month -- needs to create mass factory jobs if it's to prosper.

Yet a growing chorus of voices has begun attacking this emphasis on manufacturing, arguing that the government shouldn’t waste political capital and energy on the reforms needed to build up the sector. According to these pessimists, the politics are too hard and the economics -- at a time when global trade is slowing and robots are supplanting workers everywhere -- don’t make sense.

At best, this criticism is irrelevant -- an argument imported from the developed world, where stoking fears about the future of manufacturing has become a small but thriving industry. At worst, it's dangerous.

Take the concerns about the state of world trade. China ramped up its export-oriented manufacturing push at the beginning of this century, after its accession to the World Trade Organization; fortuitously, between 2000 and 2007, world trade doubled. India faces a much bleaker climate. The Baltic Dry index is pushing historic lows, and demand in major Western markets is anemic. Overcapacity in China means that new entrants to the sector now face stiff competition.

These arguments should indeed scare existing players and exporters (including some in parts of China) who are struggling with rising wages. But India is an underemployed nation that claims an infinitesimal proportion of world trade, especially when compared to its size and potential. It contributes barely 1.5 percent of world exports. China’s share is pushing 14 percent.

Like every other low-wage economy throughout history, India should be conspiring to steal someone else’s share of the export pie, not worrying whether there's enough to go around. This is what Vietnam and Bangladesh, for example, are busy doing. India, too, needs to focus on doubling its share of world trade in a few years -- regardless of how fast or slow that trade is growing.

Then there are the worries about the future of manufacturing. Many of them are legitimate, of course. But to hear some in the West tell it, you’d think that the robots are a few months away from stealing every single manufacturing job on the planet. In fact, even pessimistic projections assume that it will take several decades for that to happen -- and the wages of Indian workers are low enough that theirs should be among the last jobs that are automated. And, even if these Employment Terminators eventually make every single factory job irrelevant, the skills young Indians gain now are what will keep them productive in the future.

It is absurd to imagine that a technological revolution still decades away from completion could be a persuasive argument against creating an Indian manufacturing sector today. All across India's northern states, a generation of young people -- overwhelmingly young men, thanks to Indian parents' bias against girls -- need jobs now, a million a month by some estimates. If they get them, they will make India rich before they age out of the workforce. If they don't -- well, a millions-strong army of angry and disconnected young men is the stuff of nightmares.

The idea that services can fill the gap is wishful thinking. Low-skill services don't provide steady employment and the security that gives rise to entrepreneurship and education -- and eventually, a modern middle class. Meanwhile, high-skill services don't fit the profile of India's badly educated labor force. So far the country's services export sector has created barely a million jobs in total.

What make the anti-manufacturing movement in India most puzzling are the policy reforms it argues against. What's required for "Make in India" to succeed? The government needs to ensure that the Indian labor force is flexible and skilled enough to learn quickly on the job. It needs to make it easier for entrepreneurs to get land and credit to set up factories, and for small businesses to scale up. It needs to help plug Indian markets into one another other and into global markets. It needs to put quality infrastructure -- whether physical or digital or regulatory --– into place to help factories access global supply chains efficiently.

These same reforms would be needed even if the manufacturing pessimists were right in every essential; they're the same reforms required for India to succeed in any post-manufacturing, digital-first world. The skeptics have pulled off the amazing feat of being wrong even if they're right.

There are certainly many grounds on which to criticize the Modi government. Too many reforms are being put on the back burner, or have been poorly implemented. But let’s not criticize its priorities. It’s got those exactly right.


Article Link To The Bloomberg View:

Germany Discovers Some Home Truths About Brexit

Berlin is starting to admit that it needs Britain more than Merkel first let on.


By Gunnar Beck
The Wall Street Journal
September 15, 2016

Germany seems to be softening its stance on Brexit, and not a moment too soon.

“Given Britain’s size, significance, and its long membership of the European Union, there will probably be a special status which only bears limited comparison to that of countries that have never belonged to the European Union,” Michael Roth, Germany’s minister of European affairs, said last month. Mr. Roth’s comments mark a departure from Chancellor Angela Merkel’s declaration, made shortly after the Brexit referendum in June, that Britain would receive no special treatment, nor would it be allowed to “cherry pick” benefits such as full access to the single market.

The change in tone was probably inevitable. Mrs. Merkel’s initial response was a negotiating tactic that stalled when new British Prime Minister Theresa May refused to trigger formal exit negotiations immediately. Mrs. Merkel apparently hoped that the lack of any Brexit plan might lead the British government to call a second referendum or an early election.

Instead, the passage of time is revealing how weak Germany’s and the EU’s negotiating position actually is. Politically, Mrs. Merkel is committed to “ever closer” integration within the EU and wants to transform Germany into a “moral superpower.” But these goals, which have manifested partly in a willingness to bail out bankrupt eurozone member states and partly in controversial policies, such as welcoming more than 1.5 million migrants over the past 18 months, carry spiraling economic and social costs that German voters might not be prepared to bear.

So Mrs. Merkel has sought to disguise the true costs of European union by shifting the book value of Germany’s total euro rescue loans and guarantee exposure to the Bundesbank, the European Central Bank and the European Stability Mechanism. But this strategy has turned those three institutions into “bad banks” holding nonperforming assets such as Greek sovereign debt. With taxpayers on the hook in the event of losses at those institutions, Berlin can’t afford many more financial shocks.

Meanwhile, Germany has stood by while, for the sake of holding the euro together, the ECB has pursued policies that hurt Germans. German savers lost interest income worth €125 billion ($140 billion) between 2011 and 2015 as a result of the ECB’s ultra-low rates and quantitative easing, according to a study from Germany’s Postbank. And the open door to migrants will cost €50 billion in 2016 and 2017 alone and nearly €400 billion over the next 20 years, assuming optimistically that most of these refugees eventually find work. If integration fails or many more refugees arrive, the costs will be significantly higher.

Due to continuing euro crisis measures and the increasing costs of its refugee policy, Germany’s economy and public finances are likely to weaken while German unemployment should start rising again beginning next year. With economic growth chronically sputtering, Berlin (and the EU overall) will have to depend on trade-induced moderate growth to minimize the future costs of these various policies to taxpayers.

Trade with the U.K. will be a crucial component. Nine EU member states send at least 5% of their total exports to Britain, and in Germany that percentage is around 7.5. Germany’s trade surplus with the U.K. was €51 billion in 2015, around 20.5% of Germany’s entire trade surplus.

Yet even these figures understate Germany’s economic dependence on Britain. Around 36% of Germany’s total exports in 2015 went to countries within the eurozone. However, under the so-called Target2 payments system operated by the ECB, Germany’s balance-of-payments surplus with the eurozone is financed not by the transfer of foreign-currency reserves, gold or other near-liquid assets, but by an open-ended overdraft facility granted by the Bundesbank.

Under this peculiar system, the exporter is paid not by the importing country but by Germany’s central bank, which itself never receives payment. Rather, a credit note is issued by the importing country’s central bank, which it has no obligation ever to pay.

The Bundesbank’s Target2 balance stood at more than €660 billion as of July. If Germany’s eurozone exports were paid for in the same way as its other exports, it would be a much richer country.

That Germany is moderately prosperous at all under this system is owed in large measure to its trade surplus with partners outside the eurozone. This surplus is paid for in the traditional way, by transferring actual money to Germany. Germany and other export-driven eurozone economies thus depend on trade with Britain as a key partner outside the dysfunctional eurozone much more than is commonly realized.

ECB President Mario Draghi is well aware of the EU’s fragility. According to ECB and Italian political sources, he has assured investment banks, including Goldman Sachs, that Germany won’t do anything to put trade relations at risk. Mr. Draghi has also reportedly expressed confidence that French and European Commission resistance to concessions to Britain could be overcome and that, in return, Mrs. Merkel would be open to French demands for a eurozone finance ministry after the 2017 German election, as well as new bail-out facilities for Italy’s moribund banks. According to Wells Fargo, Italian banks are currently sitting on €350 billion in nonperforming loans.

If the British government plays its hand well, it will be able to choose its terms of renegotiation with the EU. By postponing the official start of withdrawal negotiation until 2017, Mrs. May has made a promising start.


Article Link To The Wall Street Journal:

Welcoming The Next 10,000 Syrian Refugees

By Editorial Board
The Bloomberg View
September 15, 2016

After a late-summer surge, the Obama administration has met its goal of admitting 10,000 Syrian refugees in 2016. The Republican House Freedom Caucus considers that 10,000 too many, preferring to stop resettling Syrians until the administration can “assure no terrorists or individuals with radical sympathies or views will be admitted.”

Such fears are largely misplaced. Few, if any, classes of travelers to the U.S. face greater scrutiny. Nevertheless, the process for admitting refugees from Syria can be tightened. And at least as important, the process of integrating them into American life can be improved.

To see how, it’s worth revisiting who these newcomers are and how they have made it here. Three-quarters have come via the United Nations High Commissioner for Refugees, which selected them from among the most vulnerable people languishing in refugee camps. Indeed, four-fifths of this year’s arrivals have been women and children; nearly half are under 18. That said, the possibility remains that some of the rest might be Islamic State recruits such as those who have blended into the refugee masses flowing toward Europe.

But consider the months-long gauntlet they would have had to run -- including face-to-face interviews with officers from the Department of Homeland Security, medical exams, screening through intelligence databases, and case referrals back in Washington. A terrorist leader looking to infiltrate operatives into the U.S. could no doubt find easier ways.

No screening process is foolproof, of course -- especially, as FBI Director James Comey has pointed out, when you’re dealing with people fleeing a war zone. Homeland Security needs more Arabic speakers to conduct interviews, and once refugees have arrived in the U.S., law enforcement and intelligence agencies could look harder for signs of radicalization and other trouble. The possibility that some newcomers might do harm exists among all immigrant groups, after all.

It’s also essential that the U.S. ensure that all the newcomers are successfully integrated, especially with the nation increasingly polarized by their arrival. For starters, the State Department needs to step up its efforts to ensure that local stakeholders are consulted on resettlement targets.

The U.S. planned to resettle 85,000 refugees from around the world this fiscal year, up from 70,000 the previous year; Secretary of State John Kerry just announced that next year, the U.S. proposes to admit 110,000. But funding for refugee assistance hasn’t kept up, in part because it’s based on past admissions. Considering the traumas Syrians have experienced, especially the children, more support is needed for mental health care and remedial education. Both the State Department and the Department of Health and Human Services should begin collecting comprehensive data about which strategies and programs work best.

The benefits of such efforts flow both ways: Refugees go to the considerable strain of moving to the U.S. because they seek opportunities to work hard and improve their lives. Thus, they can be a boon to their new communities -- creating jobs, stabilizing shrinking school districts, revitalizing blighted neighborhoods, and helping communities thrive.

On the other hand, consider the costs of denying entry to any more Syrian refugees. It would feed Islamic State’s narrative that the U.S. is anti-Muslim, and weaken America’s global leadership. Set next to the nearly half-million Syrian refugees the United Nations says need to be resettled over the next three years, 10,000 is a pretty modest figure. Set against the more than 3 million refugees the U.S. has admitted since 1975, it seems very small indeed.


Article Link To The Bloomberg View:

Aligned With Russia In Syria, Pentagon Awkwardly Treads On New Terrain

By Phil Stewart and Yeganeh Torbati
Reuters
September 15, 2016

For Pentagon officers who cut their teeth during the Cold War, the prospect of U.S. battlefield cooperation with Russia in Syria is not only uncomfortable. It's also unprecedented.

Against that background, the reactions of U.S. military officials range from caution to outright skepticism over a Geneva-based "joint integration center" that may soon bring together American and Russian militaries to discuss shared targets for the first time since World War Two.

"There are challenges with this. There is a trust deficit with the Russians," acknowledged General Joseph Votel, head of the U.S. military's Central Command, even as he voiced support for the initiative at a forum on Wednesday.

U.S. officials past and present voiced concerns about the initiative, underscoring the Pentagon's long-public criticism about the way Russia had been waging war in support of Syrian President Bashar al-Assad and over Moscow's 2014 annexation of Crimea from Ukraine.

Evelyn Farkas, a former deputy assistant secretary of defense who specialized in Russia, warned of dangers ahead.

"Conducting joint operations with the Russian military is fraught with political, military and potentially legal risk," Farkas told Reuters.

Under the deal, the United States and Russia are aiming for reduced violence over seven consecutive days before they move to the next stage of coordinating military strikes against Nusra Front and Islamic State militants, which are not party to the truce. If the truce holds, coordination could even start on Monday.

At that point, Russia and the United States could, in theory, gradually begin using the joint integration center to share targeting information.

Officials stress the Geneva-based JIC would not be similar to JOCs, the joint operation centers typical in war zones, like Iraq, replete with classified computer systems and giant television screens that show live feeds from armed drones carrying out strikes.

U.S. intelligence officials also have voiced concerns about sharing precise information on the positions of U.S.-backed rebel forces, given that Russia has targeted them in the past.

"The Russians aren't using precision-guided munitions in Syria, which gives them a perfect excuse to say, 'Sorry, we weren't aiming at your guys'," said one U.S. official, speaking on the condition of anonymity.

Civilian Casualties

Working with Russia on targeting could risk linking Washington to any Russian misconduct.

Other U.S. officials publicly sought to play down those concerns this week, with one Obama administration official saying: "While we may share information on that threat, Russia remains fully responsible for the conduct of its operations."

There also is a legal hurdle. U.S. officials say Defense Secretary Ash Carter would need to issue a waiver to a U.S. law that puts strict limitations on U.S. military cooperation with Russia.

Carter, a fierce critic of Moscow, was skeptical of military coordination with Russia during internal Obama administration discussions. He has publicly backed the agreement and said on Wednesday the ceasefire, if implemented, would ease suffering.

"We in the Defense Department will play whatever role we have (in the process) with our accustomed excellence," he said.

Advocates for the initiative say the international community has run out of good choices in Syria's war, in which more than 400,000 people have died and more than 11 million people have been displaced.

"This whole war is the search for the least bad options," sad Anthony Cordesman at the Center for Strategic and International Studies in Washington.

Retired Admiral James Stavridis, a former supreme commander of NATO, supported the effort, even though he was not optimistic.

"The odds are low of this working out, given competing if not opposing (agendas). But it is worth a try given the dire humanitarian situation," Stavridis told Reuters.


Article Link To Reuters:

Asia Stocks Waver As Policy Uncertainty, Weaker Oil Sap Confidence

By Shinichi Saoshiro
Reuters
September 15, 2016

Asian stocks wavered on Thursday as investors grappled with the apparently diminishing ability of major central banks to stimulate growth, while a tumble in crude oil prices added to the risk-averse mood.

Spreadbetters saw sentiment remaining somber in the European session, forecasting a lower open for Britain's FTSE .FTSE, Germany's DAX .GDAXI and France's CAC .FCHI.

While expectations over a Federal Reserve rate hike at next week's meeting have faded, investors are bracing for a tightening before year-end.

Perceived limits to the extensive monetary easings led by major central banks such as the European Central Bank and the Bank of Japan have also soured broader risk sentiment, driving global debt yields to multi-month highs earlier this week.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS edged down 0.1 percent.

Singapore .STI lost 0.4 percent but Hong Kong's Hang Seng .HSI rose 0.6 percent in thin trade. Mainland China markets were closed for holidays.

Japan's Nikkei .N225 slid more than 1 percent to a three-week low.

"Worries that the BOJ is struggling to come up with effective policy are making investors risk averse," said Yoshinori Shigemi, global market strategist at JPMorgan Asset Management in Tokyo.

The Fed and the BOJ both hold two-day policy meetings that end next Wednesday, with the BOJ due to comprehensively review its policies.

The BOJ has resorted to a range of unconventional policy steps such as negative interest rates, which some now see as becoming the centerpiece of future monetary easing.

Sources say board members may debate next week whether to cut rates more deeply and make changes to its massive asset-buying program.

The soggy Asian session followed an uninspiring performance overnight on Wall Street where the Dow .DJI lost 0.2 percent and the S&P 500 .SPX shed 0.1 percent, with uncertainty over future interest rate hikes and lower energy shares weighing. [.N]

The Bank of England will be a focus on Thursday. The central bank is seen standing pat after easing policy last month, amid signs it overestimated the initial shock to Britain's economy from June's Brexit vote.

"Having just increased stimulus in August, the BoE won't be eager to add bond purchases or cut interest rates again," wrote Kathy Lien, managing director of FX Strategy at BK Asset Management.

"Recent data shows how their efforts have paid off so while the BoE will leave the door open to additional stimulus, they should note the improvements in the economy and signal to the market that they are in wait-and-see mode."

Sterling added to modest gains made overnight and was last up 0.1 percent at $1.3256GBP=D4.

Elsewhere, the dollar slipped 0.1 percent to 102.345 yen JPY= as the risk off mood benefited the safe-haven Japanese currency. The greenback had briefly risen above 103.00 the previous day on speculation the BOJ would increase stimulus next week.

The euro was steady at $1.1245 EUR=.

Brent crude LCOc1 limped up 0.6 percent to $46.11 a barrel after dropping 2.6 percent on Wednesday when data showing large weekly builds in U.S. petroleum products offset a surprise draw in crude stockpiles.

The 10-year U.S. Treasury note yield US10YT=RR stood at 1.706 percent after sliding overnight to as low as 1.682 percent.

The rise in the 10-year yield slowed as bond market weakness, which had sent it to a three-month high of 1.752 percent earlier this week, ebbed slightly.

Long-dated bonds have underperformed for much of the past month along with a steepening yield curve in Japanese government bonds. The BOJ is studying options to steepen the yield curve to help prompt new lending by banks that have been hurt by low long-term rates.

Japan's 10-year government bond JP10YTN=JBTC fell a basis point to minus 0.030 percent after rising close to positive territory earlier in the week.


Article Link To Reuters:

Bayer Clinches Monsanto With Improved $66 Billion Bid

By Greg Roumeliotis and Ludwig Burger
Reuters
September 15, 2016

German drug and crop chemical maker Bayer clinched a $66 billion takeover of U.S. seeds company Monsanto on Wednesday, ending months of wrangling with a third sweetened offer that marks the largest all-cash deal on record.

The $128-a-share deal, up from Bayer's previous offer of $127.50 a share, has emerged as the signature deal in a consolidation race that has roiled the agribusiness sector in recent years, due to shifting weather patterns, intense competition in grain exports and a souring global farm economy.

"Bayer’s competitors are merging, so not doing this deal would mean having a competitive disadvantage," said fund manager Markus Manns of Union Investment, one of Bayer’s top 12 investors.

Grain prices are hovering near their lowest levels in years amid a global supply glut, and farm incomes have plunged.

But the proposed merger will likely face an intense and lengthy regulatory process in the United States, Canada, Brazil, the European Union and elsewhere. Hugh Grant, Monsanto's chief executive, said Wednesday the companies will need to file in about 30 jurisdictions for the merger.

Competition authorities are likely to scrutinize the tie-up closely, and some of Bayer's own shareholders have been highly critical of a takeover that they say risks overpaying and neglecting the company's pharmaceutical business.

If the deal closes, it will create a company commanding more than a quarter of the combined world market for seeds and pesticides in the fast-consolidating farm supplies industry.

What the newly-formed company would be named is unclear.

Grant said on Wednesday's media conference call that the future of the Monsanto brand has not yet been discussed, but the world's largest seed company is "flexible" about the name going forward.

The transaction includes a $2-billion break-up fee that Bayer will pay to Monsanto should it fail to get regulatory clearance. Bayer expects the deal to close by the end of 2017.

The details confirm what a source close to the matter told Reuters earlier.

Baader Helevea Equity Research analyst Jacob Thrane, with a "sell" rating on Bayer, said the German company was paying 16.1 times Monsanto's forecast core earnings for 2017, more than the 15.5 times ChemChina agreed to pay for Swiss crop chemicals firm Syngenta last year. He also said there was uncertainty over what the combined company would look like as regulators might demand asset sales.

Bernstein Research analysts said on Tuesday they saw only a 50 percent chance of the deal winning regulatory clearance, although they cited a survey among investors that put the likelihood at 70 percent on average.

"We believe political push-back to this deal, ranging from farmer dissatisfaction with all their suppliers consolidating in the face of low farm net incomes to dissatisfaction with Monsanto leaving the United States, could provide significant delays and complications," they wrote in a research note.

Bayer said it was offering a 44-percent premium to Monsanto's share price on May 9, the day before it made its first written proposal.

It plans to raise $19 billion to help fund the deal by issuing convertible bonds and new shares to its existing shareholders, and said banks had also committed to providing $57 billion of bridge financing.

Bayer shares rose 0.3 percent to 93.55 euros. Monsanto's were up 0.6 percent at $106.76.

Bayer's move to combine its crop chemicals business, the world's second-largest after Syngenta AG, with Monsanto's industry-leading seeds business, is the latest in a series of major agrochemicals tie-ups.

The German company is aiming to create a one-stop shop for seeds, crop chemicals and computer-aided services to farmers. That was also the idea behind Monsanto's swoop on Syngenta last year, which the Swiss company fended off, only to agree later to a takeover by China's state-owned ChemChina. U.S. chemicals giants Dow Chemical and DuPont plan to merge and later spin off their respective seeds and crop chemicals operations into a major agribusiness.

And on Tuesday, Canadian fertilizer producers Potash Corp of Saskatchewan Inc and Agrium Inc agreed to combine to navigate a severe industry slump, but the new company's potential pricing power may attract tough regulatory scrutiny. The Bayer-Monsanto deal will be the largest ever involving a German buyer, beating Daimler's tie-up with Chrysler in 1998, which valued the U.S. carmaker at more than $40 billion. It will also be the largest all-cash transaction on record, ahead of brewer InBev's $60.4 billion offer for Anheuser-Busch in 2008.

Bayer said it expected the deal to boost its core earnings per share in the first full year following completion, and by a double-digit percentage in the third year.

Bayer and Monsanto were in talks to sound out ways to combine their businesses as early as March, which culminated in Bayer's initial $122 per-share takeover proposal in May.

Antitrust experts have said regulators will likely demand the sale of some soybeans, cotton and canola seed assets.

Bayer said BofA Merrill Lynch, Credit Suisse, Goldman Sachs, HSBC and JP Morgan had committed to providing the bridge financing.

BofA Merrill Lynch and Credit Suisse are acting as lead financial advisers to Bayer, with Rothschild as an additional adviser. Bayer's legal advisers are Sullivan & Cromwell LLP and Allen & Overy LLP.

Morgan Stanley and Ducera Partners are acting as financial advisers to Monsanto, with Wachtell, Lipton, Rosen & Katz its legal adviser.


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Apple Says Initial Quantities Of iPhone 7 Plus Sold Out

By Julia Love 
Reuters
September 15, 2016

Initial quantities of the iPhone 7 Plus have sold out globally as Apple Inc prepares to roll out its new gadget in stores, the company said Wednesday.

Initial supplies of the larger size of Apple's new phone have been exhausted in all shades, and the smaller iPhone 7 has also been sold out in the new jet black color, the company said. The gadgets will arrive in stores on Friday.

"We sincerely appreciate our customers' patience as we work hard to get the new iPhone into the hands of everyone who wants one as quickly as possible," Apple spokeswoman Trudy Muller said in a statement.

Apple launched the new phones at a San Francisco event earlier this month. The gadgets feature improved cameras and eliminate the traditional headphone jack in favor of new technology.

Breaking with tradition, the company will not release first-weekend sales of the iPhone 7 and 7 Plus, saying the figure is more a reflection of supply than demand.


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Americans Blame Washington Gridlock For Slow Economic Growth

By Scott Malone
Reuters
September 15, 2016

Americans blame political gridlock in Washington for the country's declining economic competitiveness and hold both Democrats and Republicans responsible, a Harvard Business School study released on Wednesday found.

The study noted that U.S. gross domestic product grew at a rate of about 2 percent since 2000, well below the 3 to 4 percent average in the prior half-century. It said a range of factors including a complicated corporate tax code, tangled immigration system and aging roads contribute to the slow growth.

The study contends that factors including a growing wealth gap, declines in productivity growth and a rise in the number of working-age people neither employed nor seeking jobs show that the U.S. economy is becoming less competitive.

A majority of the school's alumni surveyed said they believed the U.S. political system was hurting the economy. That view crossed party lines, with 82 percent of Republicans, 74 percent of independents and 56 percent of Democrats agreeing.

"Only a minority of members of either party felt that their own party was acting in a way that supported economic growth," said Jan Rivkin, a professor at Harvard Business School and co-author of the report.

The survey did not ask whether respondents preferred Republican presidential candidate Donald Trump or Democratic candidate Hillary Clinton.

Some respondents worry that neither candidate for the White House could overcome gridlock in Washington, Rivkin said, adding "Anyone elected into the current system would face pressure toward paralysis."

A concurrent survey of the general public found smaller, but still significant, numbers blaming the political system for a languishing U.S. economy.

Some 49 percent of Republicans, 38 percent of independents and 26 percent of Democrats at large said politics were hurting growth.

The study contends partisan gridlock is preventing the federal government from tackling structural problems facing the U.S. economy, and suggested steps to address that gridlock. Among them: Changing rules that allow lawmakers to "gerrymander" districts to ensure one party's dominance; reforming campaign finance; setting term limits in the House and Senate, and eliminating party control of the federal legislative process.

The study comes a day after the Census Bureau reported median household income surged 5.2 percent last year to $56,500, its highest since 2007.

The surveys included responses from 4,807 alumni of Harvard Business School from May 3 through June 6 and 1,048 members of the general public polled June 10-26. The public survey had a margin of error of 3.3 percentage points, margin of error does not apply to the alumni survey as it was not a random sample.


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Oil Moves Higher With Global Glut Worries In The Background

By Jenny W. Hsu
MarketWatch
September 15, 2016

Crude prices headed higher in early Asia trade Thursday buoyed by bargain-hunting, but the recent strong build in U.S. oil product inventories and planned resumption of oil exports by Libya and Nigeria are likely to limit the rise.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in October CLV6, +0.32% traded at $43.72 a barrel, up $0.5, or 0.3%, in the Globex electronic session. November Brent crude LCOX6, +0.59% on London’s ICE Futures exchange rose $0.30, or 0.7%, to $46.15 a barrel.

Overnight, oil prices dropped about 3% after the U.S. Energy Information Administration data showed total supplies of crude oil and refined products grew by six million barrels in the week ended Sept. 9 to 1.4 billion barrels, near the record high reached a few weeks ago.

“That was a pretty negative report,” said Bob Yawger, director of the futures division at Mizuho Securities USA Inc.

Oil prices have wavered between $40 and $50 a barrel for months on continued uncertainty about how long the global glut of crude is set to persist. Production from the Organization of the Petroleum Exporting Countries remains high and inventories in the U.S. and elsewhere are near record levels.

Adding to the bearishness is the expected return of exports by Libya and Nigeria, whose oil sales were stifled in recent months due to a string of attacks by insurgent groups. An increase in exports by these two countries would be a major oil-market development ahead of talks in Algeria at the end of this month among OPEC members to cap output.

On Wednesday, officials in Tripoli announced they plan to load the first crude-oil cargo in nearly two years from a major port, Ras Lanuf.

“Our updated base case scenario has overall OPEC production steady at 33.3 million barrels a day, but without assuming a recovery in Libya and Nigeria that could put another million barrels per day on the market in the months ahead,” said Tim Evans, a Citi Futures analyst in a note.

“We’re not sure other producers are prepared to offset that much of an increase.”

Nymex reformulated gasoline blendstock for October RBV6, +0.87% — the benchmark gasoline contract — rose 88 points to $1.3703 a gallon, while October diesel traded at $1.3900, 83 points higher.

ICE gasoil for October changed hands at $407.50 a metric ton, down $1.50 from Wednesday’s settlement.


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