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Dave Skibowski,  IMNTBHO ! ! !
When Irish Eyes Are Voting
By John Mauldin
February 26, 2011
When Irish eyes are smiling,
Sure, 'tis like the morn in Spring.
In the lilt of Irish laughter
You can hear the angels sing.
When Irish hearts are happy,
All the world seems bright and gay.
And when Irish eyes are smiling,
Sure, they steal your heart away.
   Just when I’ve begun saying it’s safe to get back in the water, we get some shark sightings. They are a still a long ways off, but we need to keep our eyes on the deep waters and stay close to shore. This week we will look at a variety of data points and see what conclusions we can come to.
When Irish Eyes Are Voting
   Most of the world is focused on the Middle East and Libya, and rightly so. We will look at that in a minute. (Sidebar: the White House spelled the country “Lybia” in a recent tweet. Can you imagine what the liberal media would have done to poor Dan Quail if that tweet was from him? Just saying.) And I agree the Middle East is important. But my eyes are focused on what I think is the far more important event of the day, and that is the election going on in Ireland.
   I have written about Ireland before, but we need to once again focus on what are not smiling Irish eyes. Ireland was once the envy of Europe, with one of the highest growth rates in the world. It was not long ago that Ireland could borrow money at lower rates than Germany. Now rates are 6% and likely to rise with the new government. Let’s look at a few data points from a brilliantly written article by Michael Lewis, who ranks as one of my favorite writers. When he writes, I read it just for the education on what great writing should look like, as well as for the always fascinating information. The article is at http://www.vanityfair.com/business/features/2011/03/michael-lewis-ireland-201103 .
   (I am often asked about how you can become a financial writer by young people who are starting out. I have just two suggestions. Write a lot and then write some more. Writing is no different than the piano or guitar. It takes a lot of practice, and then more practice. You don’t start playing concerts on day one, and your writing won’t be worth much either, but you will get better. Second, study the great writers and learn from them. Try to copy the styles of the guys you like for practice. Take the best and make it your own style. Lewis is one of the best.)
   • Housing prices in Dublin had risen by 500% since 1994. Rents for homes were often 1% of the price of the home. A $1-million-dollar home went for $833 a month. That is a very clear bubble.
   • Irish home prices implied an economic growth rate that would leave Ireland, in 25 years, three times as rich as the United States.
   • In 1997 the Irish banks were funded entirely by Irish deposits. By 2005 they were getting most of their money from abroad. The small German savers who ultimately supplied the Irish banks with deposits to re-lend in Ireland could take their money back with the click of a computer mouse. Since 2000, lending to construction and real estate had risen from 8 percent of Irish bank lending (the European norm) to 28 percent. One hundred billion euros—or basically the sum total of all Irish public bank deposits—had been handed over to Irish property developers and speculators. By 2007, Irish banks were lending 40 percent more to property developers than they had to the entire Irish population seven years earlier.
   • As the scope of the Irish losses has grown clearer, private investors have been less and less willing to leave even overnight deposits in Irish banks and are completely uninterested in buying longer-term bonds. The European Central Bank has quietly filled the void: one of the most closely watched numbers in Europe has been the amount the ECB has loaned to the Irish banks. In late 2007, when the markets were still suspending disbelief, the banks borrowed 6.5 billion euros. By December of 2008 the number had jumped to 45 billion. As Burton spoke to [Lewis], the number was still rising from a new high of 86 billion. That is, the Irish banks have borrowed 86 billion euros from the European Central Bank to repay private creditors. In September 2010 the last big chunk of money the Irish banks owed the bondholders, 26 billion euros, came due. Once the bondholders were paid off in full, a window of opportunity for the Irish government closed. A default of the banks now would be a default not to private investors but a bill presented directly to European governments.
   • A political investigative blog called Guido Fawkes somehow obtained a list of the Anglo Irish foreign bondholders: German banks, French banks, German investment funds, Goldman Sachs. (Yes! Even the Irish did their bit for Goldman.)
   • [And this is the kicker!] “Googling things, Kelly learned that more than a fifth of the Irish workforce was employed building houses. The Irish construction industry had swollen to become nearly a quarter of the country’s G.D.P.—compared with less than 10 percent in a normal economy—and Ireland was building half as many new houses a year as the United Kingdom, which had almost 15 times as many people to house.” [That makes the US housing bubble look small by comparison.]
   • And just for fun: “A few months after the spell was broken, the short-term parking-lot attendants at Dublin Airport noticed that their daily take had fallen. The lot appeared full; they couldn’t understand it. Then they noticed the cars never changed. They phoned the Dublin police, who in turn traced the cars to Polish construction workers, who had bought them with money borrowed from Irish banks. The migrant workers had ditched the cars and gone home. Rumor has it that a few months later the Bank of Ireland sent three collectors to Poland to see what they could get back, but they had no luck. The Poles were untraceable: but for their cars in the short-term parking lot, they might never have existed.”
   Now, let’s turn to that repository of all things leftist, the UK Guardian, as they write about today’s elections.

An Extra “15 Million” Homes
   “Though the campaign has shed disappointingly little light on realistic options ahead, the financial numbers are scary. After 2000 the early Celtic Tiger years became a property-led speculative bubble, made worse by weak planning laws and 300,000 too many new homes. The crash saw GDP collapse by 11%, unemployment triple to 13.3% and government debt quadruple to 95%, which will rise to 125% by 2014 on IMF estimates.”
   Let’s think about that for a moment and compare it to the US. We built somewhere between 2 and 3 million too many homes in our bubble, depending on whom you ask. Total Irish population (including Northern Ireland) is 6 million people. If the US had built the same number of excess homes, there would have been 15 million of them! And the banks just kept lending!
    Irish taxpayers are being asked to pay French, German, and British bond banks and the ECB, which bought that debt. It is 30% of their GDP, along with the rest of the debt. At 6% interest, that means it will take 10% of their national income just to pay the interest. It guarantees that Ireland will be in a poverty cycle for decades. The ECB and the IMF seem to think the solution for too much debt is more debt. And in order to pay the ECB, the Irish must take on an austerity program that guarantees even worse recessions and higher unemployment.
   The government that agreed to take on the bank debts is going to be voted out in spectacular fashion today. Whether one party can win or has to form a coalition government is not yet clear, but the mandate is to renegotiate the Irish debt. Both the ECB and the Germans have said that is not possible, that deals have been made. But asking Irish voters, you don’t get the sense they feel the same obligation.
   Even the venerable Martin Wolf of the Financial Times agrees. Writing last week:
     “So what might a new government seek to do? Its degrees of freedom are, alas, limited. Even excluding recapitalisation of the banks, the primary fiscal deficit (before interest payments) was close to 10 per cent of GDP last year. Und er the IMF programme, this is to be turned into a surplus of 1.5 per cent of GDP by 2015. Given the lack of access to private markets, the deficit would have to be eliminated even more quickly without the official assistance. Again, the debt overhang would be huge, under any plausible assumptions. Ireland is doomed to fiscal stringency for decades, given its poor growth prospects, at least in comparison with its Tiger years.
   “Apart from the Armageddon of a sovereign default, two partial escapes exist. The more trivial would be a reduction in the rate of interest on Ireland’s borrowing: a 1 per cent reduction in the rate of interest would save the state 0.4 per cent of GDP a year. That would be a small help, at least. A more valuable possibility would be a writedown of existing subordinated and senior bank debt, which currently amounts to €21.4bn (14 per cent of GDP).
   “The ECB and the other members of the European Union have vetoed this idea, fearful of contagion. Indeed, the assistance package was partly to prevent just such an outcome. Yet the idea that taxpayers should bail out senior creditors of massively insolvent banks at such risk to the solvency of their state is both unfair and unreasonable. If the rest of the EU is determined to protect senior creditors, it should surely share in the cost of doing so. Why should the taxpayers of the borrowing country pay all? The new Irish government should make this point firmly.” (http://www.ft.com/cms/s/0/436234b8-3ebb-11e0-834e-00144feabdc0.html#ixzz1F1aZpM1L)
   There are a significant number of Irish voters who wonder why they should pay any of it. Not the majority (yet), but enough. This is the Maginot Line for the ECB. If they renegotiate with Ireland, then Greece will be at the door in a heartbeat. Ditto for Portugal.
   As one story I read about Ireland said, “Parties we go to now are going away parties as people, especially young people, leave for other countries with better opportunities.” The mood of the country will grow more dour.    Look at this chart. Notice how well Iceland did after it simply repudiated its debt. It wasn’t easy, and inflation is brutal, but they are better off than if they had taken on a debt burden that would have made them indentured servants to British taxpayers for decades. The ECB, the IMF, and the rest of the EU is asking Ireland to willingly fall into a lengthy depression. Wwalking away from the debt, or restructuring it, be any worse

   What if the opening negotiating line started was, “We will repay the principle, but no interest, and the timeline has to be stretched out over 25 years?” And nonpayments for five years. Oh, and we have about 300,000 houses you can have as our first payment.
   Yes, the Irish would be frozen out of the bond market. It would result in an even more serious recession. But they could actually grow their way out of it over time. A lot faster than if they were trying to pay off the debt at 6-7% interest. And remember that Argentina, for God’s sake, got money just a few years after defaulting – twice, if I remember right! If Ireland got back on a sound footing, they could once again find acceptance in the bond market.
   I know, that sounds radical. But give it a few years of austerity and see what the next elections bring. Irish debt will default, not because the Irish don’t have hearts of gold or don’t want to not pay their debts, but because they are under such a burden they can’t. And eventually enough voters will realize that. It may not be next month, or even next year, but it will come. You can only ask so much of a people. Defaulting on sovereign debt is only unthinkable in elite European Union circles. And asking German voters to pay for those defaults? Care to run on THAT platform?
   This has the potential to really roil the debt markets, not to mention the interbank markets. The US is doing ok, except that job creation has been slow. A European debt crisis could throw a wrench into the world gears.
   And that is the heart of the problem. The Irish really do want to do the right thing. The Greeks, not so much. Portugal? Spain?
   The leadership of the EU is living in denial if they think that more debt is the answer to too much debt. It is all well and good for the Germans to tell everyone to cut back (and they should) but to do so means that the countries go into recession and have even less money to pay their debt burdens. They get into a debt spiral and the only way out is restructuring, which is default by a nice name.
   Somewhere, sometime, this is all going to end in tears. The EU will be better off restructuring the debt, letting insolvent banks go the way of all flesh, or financing them and letting the euro drop like a stone, which will only make their exporting companies more competitive (not good for the US and China, but we don’t get to vote in the EU). Or they can break up. I think the former is better than the latter, but that’s just me.
   The world went crazy with debt. The US, Japan (where I fly to in less than 12 hours), much of Europe, and Great Britain. And now we have to deal with it. Acting like adults would be best, and recognizing that some countries just can’t assume their banking debts is just being realistic. A lot of people made bad choices and now those choices are coming home.
   It is all so very sad. People are hurting. I read the blogs in Ireland and it brings tears to me Irish eyes (or the large part of me that is of Irish heritage).
   There are no easy answers. No easy button. The only button we have is the reset button, for the Blue Screen of Death. That means pulling the plug and starting over. This time with realistic debt levels and bond markets.
Some Thoughts on the Middle East
   Let me offer a different, and perhaps cynical, view of what’s happening in the Middle East. First, the army was in control in Tunisia and Egypt, and still is. Some things will change, and hopefully the false, crony capitalism will be one of the things to go; but I don’t think we will see sweeping changes for some time. Libya is 2% of the world’s oil supply. Other than that, they are like Greece. They are not that big a player. Gaddafi is on his way out. His bank accounts are being frozen. He will end up in Venezuela or some equally wonderful place. Couldn’t happen to a nicer bad guy. The new leadership will most likely be the army, and it will get the oil turned back on as soon as possible. (See the trend here?)
   By the way, the idea that Saudi Arabia can make up for Libyan oil is a little fanciful. Libyan oil is light sweet crude, and it takes three barrels of Saudi oil to make as much diesel as Libyan oil. Oil could get very volatile and move up strongly if Gaddafi hangs on too long. $4 gas is not out of the question here in the US if he doesn’t leave soon; but at the end of the day, not too much will change in Libya.
   The key place to watch is Bahrain. Now THAT is an issue. It is a strategic country with the US 5th fleet based there, and it has a large Shiite population that could ally with Iran. There is no real way of knowing what will happen there, and that is something I have my Google notes set to watch, along with talking from time to time with George Friedman of Stratfor. Nice to have friends with inside information. But even he is not sure tonight.
   Saudi Arabia? Pay attention, but so far it looks like the changes are still in the future. One day it will change, but it doesn’t appear imminent (although anything can happen).
   The one thing that I hope changes? Maybe the Iran street will force some change. I am on record saying that one day Iran will be our new best friend. The population is young and getting younger. They’re on the Internet. They see what the world is like and they want it. Maybe not this year or next, but it will happen.
   (Quick sidebar: My friend Barry Habib pointed out an interesting trend: the first day of the month has been a big up day for the markets. And I think we could have a solid job number on Friday.)
Tokyo, London, Oregon, and Dallas
   It is time to hit the send button, as I have to get up in a few hours to catch an early flight to Tokyo, where I will only be for 48 hours. It will be interesting to see how my body does with the jet lag, so soon after Bangkok. I am just now back to normal.
   I return on Tuesday and have to be ready to speak on Thursday. Reservations are now open for the second "America: Boom or Bankruptcy?" event, on March 3rd at the Dallas Lincoln Centre Hotel, from 10:30 am to 2:00 pm. It is called “Fed Friday.” I spoke last year, and it was lots of fun. The 2010 event sold out. David Walker will be on the program with me. You can register at www.fedfriday.com
   I will also be providing the keynote address for the West Coast-based investment advisory firm of Arnerich Massena at their 2011 Investment Symposium, on April 11-12, in Newberg, OR. Contact Bonnie Chirrick at 503-239-0475.
   My friends from Copenhagen JGAM are coming to Dallas for a 2-day event April 14-15. My partners at Altegris and CMG and I will speak Thursday and Friday. JGAM has also invited Martin Barnes of BCA and Charles Rheinhard of Morgan Stanley to give presentations about the economy. Seats are limited, because attendees are invited to my house that night for a Texas BBQ dinner. If interested please contact Thomas Fischer at info@jgam.com for availability, by Friday, March 11.
   Never have I been so busy. I am actually looking forward to getting on a long plane flight and catching up on my reading. And getting to have dinner with Chris Wood of Greed & Fear fame is something I have always wanted to do. I told Chris I wanted bodyguards there after my speech. Telling the Japanese that they are a bug in search of a windshield might not be popular. And by the way, if some writer uses that line (and you know who you are), at least have the courtesy to quote me by name. I don’t come up with that many good lines.
   I see a three-week working vacation in Tuscany this June, a few days in Kiev with friends, and then Geneva in late June. I can’t wait. I will be working on my next book. Life is fun. And let me say what a pleasure it is to be able to let Tiffani do the really hard work while Dad just goofs off reading and writing, with a little travel thrown in. Big things are happening. And if you haven’t visited the new website, please do so. www.johnmauldin.com – and give me some feedback. I do read it!
   Have a good week! Sayonara for now!
Your trying to figure out how to stay on US time analyst,
   John Mauldin John@FrontlineThoughts.com
Copyright 2011 John Mauldin. All Rights Reserved.

Public Employees Should Not Have The Privilege Of Collective Bargaining

     There is a definite conflict the of interest when government employees elect the politicians who will set the rules for the negotiation of their contracts. Employees having that power is somewhat akin to holding a gun to your employer’s head while asking them for a raise. No public employee should ever have an opportunity for collective bargaining. Even FDR and George Meany agreed with that premise.
     Working for a public agency is entirely different than working for private industry. A private company can always go bankrupt or close up and go out of business. Government agencies cannot. Public employees have virtually guaranteed lifetime employment not afforded anywhere in the private sector. Having, this extreme power over their employers has resulted in the wide disparity in wages and benefits between the total income of public employees and comparably educated private employees; at times exceeding a fifty percent premium. We need to end unions ability to negotiate wage and benefit packages and never allow them back. Instead, total benefit packages and any increases thereof should be established as a percentage of private sector remuneration for comparable duties.

IMNTBHO
Dave Skibowski

"One Who Submits To God"


I submit the following essay. It is by Hank LaBate, a friend and a fellow member of the Traverse Bay Area 912 Project.  I believe it fairly & unbiasedly presents the Muslim Religion as it truly exists today - without the rhetoric of radicals on either side.  I pray to God, the one God in whom Jews, Christians and Muslims all believe, that you will take away a better understanding of one of the three largest Monotheistic religions of the world.

IMNTBHO, Dave Skibowski

Muslim (one who submits to God)

Hank LaBate

• Genesis and the story of Abraham and his 2 sons Isaac and Ishamael
• Ishmael from Sarah's hand maiden (servant)
• Isaac from Abraham's barren .wife Sarah as God promised
• From Isaac the Jewish and Christian nations
• From Ishmael the Arab nations
   The schism (split) relates first to who was the "only" son put on the alter of sacrifice by Abraham, and continues with the Muslim rejection of the Son of God in Christian and Jewish theology (Messiah and Ezra).

When Ishmael Comes Home

by Kevin Coval

   Coval, a Chicago Jewish poet, writes, in the voice of Ishmael, of images as what happens when the two brothers meet to put their father in the earth. These are the last few lines:
. . . together we will dig this grave brother
lay the bones of a man I never knew
cover earth over him, say Kaddish
we will mourn together my brother
did he tell you my name, that I look like you
love you, dreamed to have a brother
at night sleeping curled under my lineage
    my Lord is Allah, is Yahweh, is what saved you
atop the mount and damned me to wander, but
I am strong, brother, do not weep cuz the patriarch
Is gone, death is rebirth is time to build new temples
Tell stores of our father, sing his praises, mend his curses
Stand over his memory and decide where to move from here
   Isaac, I have returned
My shoes are off in your home
My open palm extends to you Salaam, Shalom, in peace
Brother, will you take my hand

Influence of Religious works (books)

Muslim                                               Hebrew
-----------------------------------------------------------------------------------
KORAN (Quran) (610 - 632 AD) - - - - -TANAKH (canon of the Hebrew Bible) (200 BC)
                                                     Includes: the Torah(5 books of Moses)
                                                                  Nevi'um (12 Prophets)
                                                                  Ketuvim (11 books of writings)
Hadith (rules, words and deeds) & - - -Talmud (Jewish law, study, customs, etc.)
Sunnah (living habits of Muhammad)
Sufi Mystics - - - - - - - - - - - - - - -Kaballah (inspired by Song of Solomon or
Inspired by Masnavi - Persian Poems)                 Song or Songs and the Sufi)
History of Muslim Religion
• Muhammad born in 570 AD in Mecca, a trading stop on a secondary trade route.
• Muhammad died in 632 AD
     o Orphaned at age 1
     o Raised by grandfather and powerful uncle who was head of Quarish tribe
     o Married a rich 40 year old widow at age 25
     o Became a man of leisure with time to spare
     o Spent much time in the desert and caves in deep contemplation
     o Was visited by the Angel Gabriel who implored him to convert his           tribesman to the one true God and stop worship of other gods and idols
     o In 610 he began to proselytize his monotheism (one God)
     o His Quarish clansmen rejected him and threatened to kill him (saved by his uncle) as they did to many of his followers.
     o In 622 his uncle died and he quickly left Mecca for the safety of Medina o He warred with his clansmen and finally triumphed in his return to Mecca in 630 AD
     o Had 6 children; 2 sons who died early in life and 4 daughters
     o Two of his daughters were married to the third and fourth Caliphs (Mohammad's successors).
     o Both the Caliphs were assassinated and thus split the Sunni and Shite major sects in the mid-600's.
     o (Most of the schism (splits) in the Muslim religion have to do with who is in charge, i.e., blood line or politics.)
   The Muslim religion and Islam (which includes the religion and the culture of the rules and laws of the Hadith/Sunnah and Shariah law (devised by the first and second Caliphs) spread west to the Atlantic across north Africa and the Iberian peninsula and east to Asia minor very quickly in the first hundred years after Muhammad's death. More often than not, military threat and conquest rather than religious conversions were the cause of the spread of Islam.
Islam Today (peace through submission to God)
1. Approximately 1.5+ billion Muslims in the world; mostly in the Middle East, Indonesia and North Africa. (200 million in 1900, 550 million in 1970).
2. Examples of Hadith/Sunnah -Clerics interpretation of Muhammad's words in the Koran and recording of his or his companions actions and responses include the following: Revelation, Belief, Knowledge, Ablutions (washing of the body), Rubbing hands and feet with dust, prayers, Virtues of the prayer Hall, times of prayers, Call to Prayers (Adhaan), Characteristics of Prayer, Friday Prayer, The Two Festivals, Invoking Allah for Rain, Eclipses, prostration during recital of Quran, Prayer at Night, Funerals, Obligatory Charity Tax, Pilgrimage (Hajji), Penalty of Hunting while on pilgrimage, and there are many more.
Shari'ah (path) Law-
   Shari'ah is considered God's Law, distinct from all human codes of law. It is God's indispensable link between Himself and His people (ummah); the manifestation of His divine will for Muslims and for those non-Muslim minorities (or majorities) under the domination of the Muslim community, (pious point of view) It is derived from the Koran and Hadith/Sunnah and, all too often, includes some disgusting tribal traditions that include "honor killings" that predate the Muslim religion. In countries that have secular and Shari'ah law, Shari'ah is limited to familial issues (marriage, divorce, inheritance, etc.). Interesting, a NY Times November 2008, article, entitled: Britain Grapples With Role for Islamic Justice, discussed the country allowing sharia law in governing marriage, divorce, and inheritance to make legally binding decisions if both parties agree. The new system is noted to be in line with separate mediation allowed for Anglican and Jewish communities in England. (You can find the article on-line at: http://www.nytimes.com/2008/ll/19/world/europe/19shariah.html? r=l&pagewanted=l). "There is no reason why principles of sharia law, or any other religious code, should not be the basis for mediation," Britain's top judge, Lord Nicholas Phillips, said in a July 2008 speech (PDF). Supporters of this initiative, such as the archbishop of Canterbury, Rowan Williams, argue that it would help maintain social cohesion (BBC) in European societies increasingly divided by religion. However, some research suggests the process to be discriminatory toward women (BBC). Other analysts suggest the system has led to grey areas. Britain's Muslims come from all over the world, Ishtiaq Ahmed, a spokesperson for the Council for Mosques in England, told the BBC, noting that this makes it hard to discern at times "where the rulings of the sharia finish and long-held cultural practices start." Sharia has recently become a topic of political concern in the United States. The state of Oklahoma passed a ballot measure in November 2010 to ban the use of sharia law in court cases, which supporters are calling "a preemptive strike against Islamic law" (ABCNews). Several opponents of new mosques being built around the United States, including one near Ground Zero, have cited fear of the spread of sharia as a reason for opposition. And about a third of Americans in an August 2010, Newsweek poll suspect U.S. President Barack Obama sympathizes with Islamist goals to impose sharia.
   There are three categories of punishment derived from the Koran and Hadiths:
a. Hadd are those that are directly addressed in the Koran (most horrific punishment including stoning, flogging and amputation). Include unlawful sexual intercourse, false accusation of sexual intercourse, wine drinking, theft and highway robbery,
b. Judge discretion,
c. Tit-for-Tat (blood money payment).
   Those that seek to eliminate or at least modify these controversial (Hadd punishment) practices cite the religious tenet of tajdid. The concept is one of renewal, where Islamic society must be reformed constantly to keep it in its purest form. "With the passage of time and changing circumstances since traditional classical jurisprudence was founded, people's problems have changed and conversely, there must be new thought to address these changes and events," says Dr. Abdul Fatah Idris, head of the comparative jurisprudence department at AI-Azhar University in Cairo. Though many scholars share this line of thought, there are those who consider the purest form of Islam to be the one practiced in the seventh century.
Government under God countries - Saudi Arabia, Kuwait, Bahrain, Yemen, the United Arab Emirates allow alcohol), Pakistan, Egypt, Iran, and Iraq, (in some countries Non-Muslims are not expected to obey shariah and in most countries, they are the jurisdiction of special committees and adjunct courts under the control of the government.)
Secular countries - Azerbaijan, Tajikistan, Chad, Somalia, Senegal and Turkey. Turkish Prime Minister Recep Tayyip Erdogan, told Newsweek, "Turkey has achieved what people said could never be achieved-a balance between Islam, democracy, secularism and modernity." Secular Muslim countries are a minority, however, and the popularity of Islamist political parties are narrowing the gap between religion and state.
4. HAJJ - Yearly pilgrimage to Mecca which commemorates trials of Abraham and family. Muhammad said proper Hajj will return person as newly born and sinless.
5. IHRAM - Spiritual state of purity during Hajj requiring no sex, quarrelling violence or wearing two piece unsewn clothes.
6. KA'BA - Stone cube shaped building, said to have been built by Abraham and Ishmael but contained idols of 26 gods before Muhammad returned and smashed them in 630 AD. It was the site of pagan pilgrimage much before the Muslims.
7. Five Pillars of Islam (believed by both Sunni and Shi'a)
     a. Shahabad - Profession of Faith
     b. Salah - ritual prayer, 5 times a day facing Mecca (Ka'ba)
     c. Zakah - alms tax
     d. Sawm - fasting during Ramadan
     e. Hajj
   In addition, the Shi'a believe in the following 3 additional Pillars along with the previous 5 Pillars:
     f. Jihad important to Sunni but not a Pillar to struggle in the way of God or to struggle to improve self or society. Jihad is directed against devil's inducements, aspects of one own self, or against visible enemy. Four categories of Jihad are: self-persecution, jihad of tongue, jihad of hand, and jihad of sword.
     g. Amr-Bil-Ma'Ruf- enjoing to do good.
     h. Nahi-Anil-Munkar=exhortation to desist from evil.
Sects of Islam
1. SUNNI-80%-believe in electing leaders-Caliphs
2.  4 major schools of law
     a. Hanifites-most liberal-Turks/ldians/central sians(Usbecks/Kirgs-       Kazaks/Pakistanis/Bangaladeshis
     b. Malikites-traditionalist-Kuwaite/UAE/Bahraiann/Sudan/uper     Egypt/Lybia/Tunesia/Algeria/Morocco/west africa/Spain
    c. Shafite.-believe hadith on level of Qur'an-Palastine/Jordan/Syria/Lebanon/lraq/Kurds in Iran/east africa/lndonesia
    d. Hanablite-most fundamental & fanatic-accept Wahhabi & Islamic brotherhood, want religious Islamic governments not secular Arabic states-Saudi Arabia/Afghanistan/Pakistan
    • Salafi,Wahhabi and Ahle Hadith are sometimes used interchangeably
    • Wahhabi also called particular orientation within Salafismfancestors fundamentalism- 1st three generations-follow strict Qur'an & Hadith interpretations law Alhari school of Aqeedah (believe only what is written w/no interpellation)). Wahhabi is considered derogatory and they prefer 'Unitarians' (Muwahiddun).
    • Wahabbi primary doctrine is Tawhid, or uniqueness of unity of God
2. SHIITES(SHI'A) 10-20%-(PARTY OF ALI-cousin/SON IN LAW of Mohammad)-bloodline of succession-12. Imams are infallible-death of 12th Imam (Husayn) is like Christ death-Shiite law practiced in Iran/Lebanon/Syria/Palestine.
    a. One major school of law-Ja'fari
    b. 8 sub sects
        • Kharijites(Seceders)-extreme fundamentalists-assassinated Ali-Qur'an interpreted literally-no interpretation
        • Murjiites(Postponers)-among Muslims, only polytheist go to hell
        • Hashimites and the Abbasids-Jordan-descendants of al-Abbas uncle of Muhammad & Ali. Kept throne from Shiites,
        • Meccans & al-Mansour-believe at end of history religious leader of Islam name will be exact name of prophet- Muhammad Iban Abd Allah
        • Zaydis-most like Sunni. Don't believe in return of hidden Imam- Imam must be chosen from Ali's line based on ability/learning- oppose Sufi mystics- Yemen
        • Assassins of Almamut-smoke hashish before going on suicide missions-tried to kill Sunni Caliphs & followers
        • Druze-secretive Muslims-civil wars with Christians in Lebanon
        • Nusavris(Alawites)-Syria (500.000) -They celebrate Christian holy days.
3. IBADISM-<1%, distinct from Sunni and Shi'ia. One of oldest sects. Very conservative but very tolerant- agree with some of the Sunni Caliphs and Hadith-Oman/Libya/Algeria/east Africa(Zanzibar)/Tunisia
3 Groups of Islam Philosophy
    1. MU'TAZILA-uphold philosophy of reason
    2. PREDESTINATION-(IF ALLA WILLS-)
    3. SUFIS-Mystics who focus on loving and experiencing God directly. Similar to Jewish Kabbalah and said by some to have inspired them.
Muslims Come in 4 Social Types
    1. Fanatics -ritualistic and usually poorly educated
    2. Religious & Educated - can discuss with open mind
    3. Nominal - all levels of society and have traditional knowledge of religion/open to gospel of Christ
    4. Mixed Marriage - able to consider other religions, i.e., Christianity
   The point is that there are many different forms of the Muslim religion and only a few sub sects want to kill all the Jews and Christians. Each sub sect follows different Hadiths/Shariah and is more or less accepting of the world's other religions, Muslim, as a religion, is not monolithic. It is my belief that the Koran's reference to infidels was not directed toward Jews and Christians but toward Mohammad's own clansman who were polytheists. The Koran says that Mohammad, at Medina, directed his followers to "go to the Christian lands and wait for me to call for you. They will take care of you until I call" and the Koran says "respect the people of the Book" (Torah)?
   Regrettably, I fear that there are a great many "radicalized" Muslims that have been taught hateful Hadiths. They are not all bomb throwers but they are supportive of bomb throwers. They number in the 100's of millions. I believe that the attempt to turn this very large ship full of say 400 million radicalized Muslims very, very slowly to the right by injecting the politics of personal freedom into the middle east in two strategic countries; Iraq and Afghanistan, was the best chance we have of quelling this hatred for the world by the radical Muslims. I pray that it will work. Jews, Christians and Muslims are all cousins linked through Abraham. We believe in our one true God and none of us are infidels in the meaning of Mohammad. Remember that his clansmen were trying to kill him after his Uncle in Mecca died.

Time context is important

Poem About September llc By Rooshna Kidwai

Tragedy struck the country on the llth of September

Terror grasped our hearts on a day that all will remember

Shock combined with anger, pain combined with fear

As we intently watched the news and brushed away the tears

Planes explode into buildings, causing them to collapse

Maybe a scene from a movie, or just a nightmare, perhaps?

But that's just wishful thinking, we knew it was very real

Because the families of the victims wait for the pain to heal

The question continued to echo, only the answer did we lack

Who were the monsters who committed this deadly terrorist attack?

Now we know their identities: Muslims by their names

And because of these cowards, all Muslims were defamed

This isn't what Islam teaches; I'm a Muslim so I should know

What the terrorists did was wrong, and Hell is where they will go

Us Muslims did nothing wrong, but still you persist to despise

A group of innocent people, who now fear to step outside

We won't ask you to forgive us for something we didn't do

But please respect us like your own, because we are just like you

Let's hold our hands with peace, and lets join our hearts with love

Pray for the victims who died in the blue sky up above

Too high above for us to know how these people felt

The victims in the buildings and the horror with which they dealt

Imagine the pain of their families, who lie at home in wait

For someone to come inform them of their beloved's fate

We called it the United States, but it wasn't until now

That we were a country united under a single vow

Dear God, Together we stand and together we pray

For all who lost their lives on that sorrowful day

And protect all the Muslims from anyone who expresses malice

And doesn't know the difference between a Muslim and a terrorist

GOD BLESS AMERICA

© 2001 Rooshna Kidwai. AH rights reserved to the author. Reprinted here by permission.

Henry LaBate biography

I am a graduate of Clark, NJ regional high school, class of 1959. I attended Rutgers University for one year prior to joining the US Navy. I spent 20 years in the US Navy, qualifying in submarines and serving on nuclear and diesel fast attack and World War ll diesel submarines as well as Fleet Ballistic Missile submarines. I also served on Admiral Rickover’s staff at Nuclear Reactors code 08 in the Naval Sea Systems Command in Washington, D.C. The US Navy sent me to the University of New Mexico where I graduated with a degree in Electrical engineering in 1967. I received graduate level Nuclear Power education from the US Navy and attended George Washington University for MBA studies.

I have been employed by various consulting firms in Washington D.C., including Booz Allen & Hamilton and have been employed by RCA, General Electric, Martin Marietta and Lockheed Martin (same job but our division was sold/acquired) for the past 25 years as a test engineering manager for Aegis (computer controlled combat systems) Cruisers and Destroyers. I headed a project to install the Aegis system on Japanese ships for 15 years and traveled and lived in Japan extensively. I am semi-retired and consult part time for Lockheed Martin.

My wife Diane and I reside in Long Lake, Traverse City, Michigan and Bayville, New Jersey. We are members of the Traverse Bay 912 Project. We are avid sailors and RVers.

Aviation Security Threats and Realities

With the uproar about airline security raging, you may ask, "Are we really doing the right thing"? Read the following, and make up your own mind . . .
Dave Skibowski

November 23, 2010
By Scott Stewart

   Over the past few weeks, aviation security — specifically, enhanced passenger-screening procedures — has become a big issue in the media. The discussion of the topic has become even more fervent as we enter Thanksgiving weekend, which is historically one of the busiest travel periods of the year. As this discussion has progressed, we have been asked repeatedly by readers and members of the press for our opinion on the matter.
   We have answered such requests from readers, and we have done a number of media interviews, but we’ve resisted writing a fresh analysis on aviation security because, as an organization, our objective is to lead the media rather than follow the media regarding a particular topic. We want our readers to be aware of things before they become pressing public issues, and when it comes to aviation-security threats and the issues involved with passenger screening, we believe we have accomplished this. Many of the things now being discussed in the media are things we’ve written about for years.
   When we were discussing this topic internally and debating whether to write about it, we decided that since we have added so many new readers over the past few years, it might be of interest to our expanding readership to put together an analysis that reviews the material we’ve published and that helps to place the current discussion into the proper context. We hope our longtime readers will excuse the repetition.
   We believe that this review will help establish that there is a legitimate threat to aviation, that there are significant challenges in trying to secure aircraft from every conceivable threat, and that the response of aviation security authorities to threats has often been slow and reactive rather than thoughtful and proactive.
   Threats
   Commercial aviation has been threatened by terrorism for decades now. From the first hijackings and bombings in the late 1960s to last month’s attempt against the UPS and FedEx cargo aircraft, the threat has remained constant. As we have discussed for many years, jihadists have long had a fixation with attacking aircraft. When security measures were put in place to protect against Bojinka-style attacks in the 1990s — attacks that involved modular explosive devices smuggled onto planes and left aboard — the jihadists adapted and conducted 9/11-style attacks. When security measures were put in place to counter 9/11-style attacks, the jihadists quickly responded by going to onboard suicide attacks with explosive devices concealed in shoes. When that tactic was discovered and shoes began to be screened, they switched to devices containing camouflaged liquid explosives. When that plot failed and security measures were altered to restrict the quantity of liquids that people could take aboard aircraft, we saw the jihadists alter the paradigm once more and attempt the underwear-bomb attack last Christmas.
   In a special edition of Inspire magazine released last weekend, al Qaeda in the Arabian Peninsula (AQAP) noted that, due to the increased passenger screening implemented after the Christmas Day 2009 attempt, the group’s operational planners decided to employ explosive devices sent via air cargo (we have written specifically about the vulnerability of air cargo to terrorist attacks).
   Finally, it is also important to understand that the threat does not emanate just from jihadists like al Qaeda and its regional franchises. Over the past several decades, aircraft have been attacked by a number of different actors, including North Korean intelligence officers, Sikh, Palestinian and Hezbollah militants and mentally disturbed individuals like the Unabomber, among others.
   Realities
   While understanding that the threat is very real, it is also critical to recognize that there is no such thing as absolute, foolproof security. This applies to ground-based facilities as well as aircraft. If security procedures and checks have not been able to keep contraband out of high-security prisons, it is unreasonable to expect them to be able to keep unauthorized items off aircraft, where (thankfully) security checks of crew and passengers are far less invasive than they are for prisoners. As long as people, luggage and cargo are allowed aboard aircraft, and as long as people on the ground crew and the flight crew have access to aircraft, aircraft will remain vulnerable to a number of internal and external threats.
   This reality is accented by the sheer number of passengers that must be screened and number of aircraft that must be secured. According to figures supplied by the Transportation Security Administration (TSA), in 2006, the last year for which numbers are available, the agency screened 708,400,522 passengers on domestic flights and international flights coming into the United States. This averages out to over 1.9 million passengers per day.
   Another reality is that, as mentioned above, jihadists and other people who seek to attack aircraft have proven to be quite resourceful and adaptive. They carefully study security measures, identify vulnerabilities and then seek to exploit them. Indeed, last September, when we analyzed the innovative designs of the explosive devices employed by AQAP, we called attention to the threat they posed to aviation more than three months before the Christmas 2009 bombing attempt. As we look at the issue again, it is not hard to see, as we pointed out then, how their innovative efforts to camouflage explosives in everyday items and hide them inside suicide operatives’ bodies will continue and how these efforts will be intended to exploit vulnerabilities in current screening systems.
   As we wrote in September 2009, getting a completed explosive device or its components by security and onto an aircraft is a significant challenge, but it is possible for a resourceful bombmaker to devise ways to overcome that challenge. The latest issue of Inspire magazine demonstrated how AQAP has done some very detailed research to identify screening vulnerabilities. As the group noted in the magazine: “The British government said that if a toner weighs more than 500 grams it won’t be allowed on board a plane. Who is the genius who came up with this suggestion? Do you think that we have nothing to send but printers?”
   AQAP also noted in the magazine that it is working to identify innocuous substances like toner ink that, when X-rayed, will appear similar to explosive compounds like PETN, since such innocuous substances will be ignored by screeners. With many countries now banning cargo from Yemen, it will be harder to send those other items in cargo from Sanaa, but the group has shown itself to be flexible, with the underwear-bomb operative beginning his trip to Detroit out of Nigeria rather than Yemen. In the special edition of Inspire, AQAP also specifically threatened to work with allies to launch future attacks from other locations.
   Drug couriers have been transporting narcotics hidden inside their bodies aboard aircraft for decades, and prisoners frequently hide drugs, weapons and even cell phones inside body cavities. It is therefore only a matter of time before this same tactic is used to smuggle plastic explosives or even an entire non-metallic explosive device onto an aircraft — something that would allow an attacker to bypass metal detectors and backscatter X-ray inspection and pass through external pat-downs.
   Look for the Bomber, Not Just the Bomb
   This ability to camouflage explosives in a variety of different ways, or hide them inside the bodies of suicide operatives, means that the most significant weakness of any suicide-attack plan is the operative assigned to conduct the attack. Even in a plot to attack 10 or 12 aircraft, a group would need to manufacture only about 12 pounds of high explosives — about what is required for a single, small suicide device and far less than is required for a vehicle-borne improvised explosive device. Because of this, the operatives are more of a limiting factor than the explosives themselves; it is far more difficult to find and train 10 or 12 suicide bombers than it is to produce 10 or 12 devices.
   A successful attack requires operatives who are not only dedicated enough to initiate a suicide device without getting cold feet; they must also possess the nerve to calmly proceed through airport security checkpoints without alerting officers that they are up to something sinister. This set of tradecraft skills is referred to as demeanor, and while remaining calm under pressure and behaving normally may sound simple in theory, practicing good demeanor under the extreme pressure of a suicide operation is very difficult. Demeanor has proved to be the Achilles’ heel of several terror plots, and it is not something that militant groups have spent a great deal of time teaching their operatives. Because of this, it is frequently easier to spot demeanor mistakes than it is to find well-hidden explosives. Such demeanor mistakes can also be accentuated, or even induced, by contact with security personnel in the form of interviews, or even by unexpected changes in security protocols that alter the security environment a potential attacker is anticipating and has planned for.
   There has been much discussion of profiling, but the difficulty of creating a reliable and accurate physical profile of a jihadist, and the adaptability and ingenuity of the jihadist planners, means that any attempt at profiling based only on race, ethnicity or religion is doomed to fail. In fact, profiling can prove counterproductive to good security by blinding people to real threats. They will dismiss potential malefactors who do not fit the specific profile they have been provided.
   In an environment where the potential threat is hard to identify, it is doubly important to profile individuals based on their behavior rather than their ethnicity or nationality — what we refer to as focusing on the “how” instead of the “who.” Instead of relying on physical profiles, which allow attack planners to select operatives who do not match the profiles being selected for more intensive screening, security personnel should be encouraged to exercise their intelligence, intuition and common sense. A Caucasian U.S. citizen who shows up at the U.S. Embassy in Nairobi or Dhaka claiming to have lost his passport may be far more dangerous than some random Pakistani or Yemeni citizen, even though the American does not appear to fit the profile for requiring extra security checks.
   However, when we begin to consider traits such as intelligence, intuition and common sense, one of the other realities that must be faced with aviation security is that, quite simply, it is not an area where the airlines or governments have allocated the funding required to hire the best personnel. Airport screeners make far less than FBI special agents or CIA case officers and receive just a fraction of the training. Before 9/11, most airports in the United States relied on contract security guards to conduct screening duties. After 9/11, many of these same officers went from working for companies like Wackenhut to being TSA employees. There was no real effort made to increase the quality of screening personnel by offering much higher salaries to recruit a higher caliber of candidate.
   There is frequent mention of the need to make U.S. airport security more like that employed in Israel. Aside from the constitutional and cultural factors that would prevent American airport screeners from ever treating Muslim travelers the way they are treated by El Al, another huge difference is simply the amount of money spent on salaries and training for screeners and other security personnel. El Al is also aided by the fact that it has a very small fleet of aircraft that fly only a small number of passengers to a handful of destinations.
   Additionally, airport screening duty is simply not glamorous work. Officers are required to work long shifts conducting monotonous checks and are in near constant contact with a traveling public that can at times become quite surly when screeners follow policies established by bureaucrats at much higher pay grades. Granted, there are TSA officers who abuse their authority and do not exhibit good interpersonal skills, but anyone who travels regularly has also witnessed fellow travelers acting like idiots.
   While it is impossible to keep all contraband off aircraft, efforts to improve technical methods and procedures to locate weapons and IED components must continue. However, these efforts must not only be reacting to past attacks and attempts but should also be looking forward to thwart future attacks that involve a shift in the terrorist paradigm. At the same time, the often-overlooked human elements of airport security, including situational awareness, observation and intuition, need to be emphasized now more than ever. It is those soft skills that hold the real key to looking for the bomber and not just the bomb.
  
"Aviation Security Threats and Realities is republished with permission of STRATFOR."
http://www.stratfor.com/weekly/20101123_aviation_security_threats_and_realities

With Certainty

It is only certain that uncertainty rules . . .

It really doesn't make a whole lot of difference if we are in the first part of a double dip recession or close to the bottom of a single dip; the US economic recovery will be very, VERY slow compared to what the country has been used to after past recessions.

   The recovery won't really get under way until the real estate market gets back on track. Today, the estimate is that we have more than a year’s supply of homes on the market. That is, a year's supply of what used to be a year's supply in the good (read, "of course the beanstalk grows to the moon, stupid") old days. In today's market it is two or three times that amount. Then there is the shadow inventory (those are the houses that the banks will wind up owning when this all shakes out, and which they will then dump on the market.) that will be, at least, another 12 months added. So you see, in real terms it may be 4, 5, 6 or even seven years before things get back to some semblance of "normal" in the residential real estate market. Oh yes, we are just now beginning to feel the slump in the commercial real estate market. That bit of bad news has yet to be figured into the sound bites of the Political Wonks.
   The American Consumer is not as stupid as most political and financial pundits are. Those of us who live in the real world, that is East of Riverside, CA, and west of the Hudson River, excluding that part of the heartland which lies inside "Beltway"; have a much better understanding where the economy is, and where it is going than those inside the Beltway, on Wall Street, or the nuts of the West.
   Consumers have become Savers and are saving all they can, at least those who have a job are. Job or no job, there are few who are spending on anything which isn't necessary, so retail sales aren't going to pull us out of the doldrums. Small businesses, the major creators of jobs, aren't going to do anything that uses cash because they don't know what "money grabbing/money costing" Sisyphean Load Washington will pile on their backs next.
   Maybe the Tea Partiers and their associated groups will get Washington's attention and stop the ridiculous taxing and spending spree before it is too late. The only certainties are these:
   · Unless things turn around, the U.S. will be relegated to Third World Status by the time my Grandson graduates from collage and has to go to India or China to find a job.
   · Until entrepreneurs are free to carry on business without fear of retribution from Washington, we will continue with 10% plus unemployment.
   · Without reducing the exponentially increasing size and cost of government, that’s all governments, Federal, State and Local, to somewhere under 5 % of GDP, we will continue to be a debtor nation.
   Maybe it wouldn’t be so bad. I wonder how Mexico would treat US illegals streaming into their country looking for a job?

IMNTBHO
Dave Skibowski

HIGH TAXES AND POORLY EDUCATED WORKERS DRIVE BUSINESSES OFF SHORE . . .

Sending Jobs Overseas, and Corporate Tax Breaks
From: FactCheck.org

Q: What kind of tax breaks does the U.S. give to oil companies and to corporations that send jobs overseas?

When Democratic presidential candidates talk about tax breaks for corporations that ship our jobs overseas and tax breaks and subsidies for oil companies, what are they referring to and are they accurate?

A: Companies with overseas subsidiaries can keep their income untaxed by the IRS if they don't transfer that revenue back to the U.S. Oil and gas companies received tax breaks and subsidies from a 2005 energy bill, but the bill led to a net tax increase for them.
It’s true that Sens. Hillary Clinton and Barack Obama have associated the transfer of U.S. jobs overseas with tax breaks, or loopholes, for companies that practice off-shoring:


Obama, Nov. 3, 2007: When I am president, I will end the tax giveaways to companies that ship our jobs overseas, and I will put the money in the pockets of working Americans, and seniors, and homeowners who deserve a break.
Clinton, Nov. 19, 2007: And we are going to finally close the tax loopholes and stop giving tax breaks to companies that ship jobs overseas. Enough with outsourcing American jobs using taxpayer dollars.

Both candidates are referring to a feature of the U.S. tax code that allows domestic companies to defer taxes on “unrepatriated income.” In other words, revenue that companies earn through their overseas subsidiaries goes untaxed by the IRS as long as it stays off the company’s U.S. books.

But economists, including left-leaning ones, do not agree that eliminating this provision will bring an end to off-shoring. And here’s why: In the U.S., companies are taxed 35 percent on earnings of $10 million to $15 million or on all earnings over $18.3 million. That’s one of the highest corporate tax rates in the world, making an overseas move somewhat attractive to companies that wish to avoid the U.S. tax rate. But that's not the leading reason companies send jobs overseas. According to a 2005 report by the Government Accountability Office, global technological advancement, increased openness of countries such as China and India, the higher education level of foreign workers in technological fields, and the reduced cost per foreign worker are all contributing factors to off-shoring.

We first addressed this popular theme in 2004, when we reported on a John Kerry campaign ad in which he blamed President George W. Bush for providing tax incentives to companies “outsourcing” jobs overseas. At the time we found that such tax breaks, which do exist, pre-dated the Bush administration and that even Democratic-leaning economists did not support the idea that changing the corporate tax code would end the movement of jobs overseas.

Three years later, in Dec. 2007, we reported on an ad launched by a labor group in support of John Edwards. The ad implied that corporate tax breaks were responsible for the shipment of jobs overseas from an Iowa Maytag plant. We found that the jobs were actually sent to Ohio and that, again, eliminating such tax breaks would not go far in stanching the flow of jobs overseas.

Oil Company Tax Breaks?
Both leading Democratic candidates have referred to tax breaks to oil companies:

Clinton, July 23, 2007: First of all, I have proposed a strategic energy fund that I would fund by taking away the tax break for the oil companies, which have gotten much greater under Bush and Cheney.
Obama, June 22, 2007: In the face of furious lobbying, Congress brushed aside incentives for the production of more renewable fuels in favor of more tax breaks for the oil and gas companies.


Both candidates are referring to H.R. 6, the 2005 energy bill that contained $14.3 billion in subsidies for energy companies. However, as we’ve reported numerous times, a vast majority of those subsidies (all but $2.8 billion) were for nuclear power, energy-efficient cars and buildings, and renewable fuels research. In addition, according to the nonpartisan Congressional Research Service, the tax changes in the 2005 energy bill produced a net tax increase for the oil and gas companies, as we’ve reported time and time and time again. They did get some breaks, but they had more taken away.


Emi Kolawole


Sources
Remarks of Senator Barack Obama: A Change We Can Believe In. 3 Nov. 2007. Obama for America. 26 Feb. 2008.
Policy Address on America's Economic Challenges. 19 Nov. 2007. Hillary Clinton for President. 26 Feb. 2008.
Remarks of Senator Barack Obama: Taking Our Government Back. 22 Jun. 2007. Obama for America. 26 Feb. 2008.
Democratic Presidential Debate. 23 Jul. 2007. CNN Transcripts.
Congressional Research Service. "Oil and Gas Tax Subsidies: Current Status and Analysis." Washington: GPO, 2007.
U.S. Government Accountability Office. "Offshoring of Services: An Overview of the Issues," Nov. 2005.

Copyright © 2003 - 2009, Annenberg Public Policy Center of the University of Pennsylvania

Elections and Obama's Foreign Policy Choices

They may be few, but he has choices.


September 14, 2010
0856 GMT

From:  Stratfor Golobal Intelligence http://www.stratfor.com/
By George Friedman

   We are now nine weeks away from the midterm elections in the United States. Much can happen in nine weeks, but if the current polls are to be believed, U.S. President Barack Obama is about to suffer a substantial political reversal. While we normally do not concern ourselves with domestic political affairs in the United States, when the only global power is undergoing substantial political uncertainty, that inevitably affects its behavior and therefore the dynamics of the international system. Thus, we have to address it, at least from the standpoint of U.S. foreign policy. While these things may not matter much in the long run, they certainly are significant in the short run.
   To begin thinking about this, we must bear three things in mind. First, while Obama won a major victory in the Electoral College, he did not come anywhere near a landslide in the popular vote. About 48 percent of the voters selected someone else. In spite of the Democrats’ strength in Congress and the inevitable bump in popularity Obama received after he was elected, his personal political strength was not overwhelming. Over the past year, poll numbers indicating support for his presidency have deteriorated to the low 40 percent range, numbers from which it is difficult, but not impossible, to govern.
   Second, he entered the presidency off balance. His early focus in the campaign was to argue that the war in Iraq was the wrong war to fight but that the war in Afghanistan was the right one. This positioned him as a powerful critic of George W. Bush without positioning him as an anti-war candidate. Politically shrewd, he came into office with an improving Iraq situation, a deteriorating Afghanistan situation and a commitment to fighting the latter war. But Obama did not expect the global financial crisis. When it hit full blast in September 2008, he had no campaign strategy to deal with it and was saved by the fact that John McCain was as much at a loss as he was. The Obama presidency has therefore been that of a moderately popular president struggling between campaign promises and strategic realities as well as a massive economic crisis to which he crafted solutions that were a mixture of the New Deal and what the Bush administration had already done. It was a tough time to be president.
   Third, while in office, Obama tilted his focus away from the foreign affairs plank he ran on to one of domestic politics. In doing so, he shifted from the area where the president is institutionally strong to the place where the president is institutionally weak. The Constitution and American tradition give the president tremendous power in foreign policy, generally untrammeled by other institutions. Domestic politics do not provide such leeway. A Congress divided into two houses, a Supreme Court and the states limit the president dramatically. The founders did not want it to be easy to pass domestic legislation, and tradition hasn’t changed that. Obama can propose, but he cannot impose.
   Therefore, the United States has a president who won a modest victory in the popular vote but whose campaign posture and the reality under which he took office have diverged substantially. He has been drawn, whether by inclination or necessity, to the portion of his presidency where he is weakest and most likely to face resistance and defeat. And the weaker he gets politically the less likely he is to get domestic legislation passed, and the defeats will increase his weakness.
   He does not, at the moment, have a great deal of public support to draw on, and the level of vituperation from the extremes has reached the level it was with George W. Bush. Where Bush was accused by the extreme left of going into Iraq to increase profits for Halliburton and the oil companies, Obama is being accused by the extreme right of trying to create a socialist state. Add to this other assorted nonsense, such as the notion that Bush engineered 9/11 or that Obama is a secret Muslim, and you get the first whiff of a failed presidency. This is not because of the prospect of midterm reversals — that has happened any number of times. It is because Obama, like Bush, was off balance from the beginning.
   If Obama suffers a significant defeat in Congress in the November elections, he will not be able to move his domestic agenda. Indeed, Obama doesn’t have to lose either house to be rendered weak. The structure of Congress is such that powerful majorities are needed to get anything done. Even small majorities can paralyze a presidency.
   Under these circumstances, he would have two choices. The first is to go into opposition. Presidents go into opposition when they lose support in Congress. They run campaigns against Congress for blocking their agenda and blame Congress for any failures.Essentially, this was Bill Clinton’s strategy after his reversals in 1994, and it worked in 1996. It is a risky strategy, obviously. The other option is to shift from the weak part of the presidency to the strong part, foreign policy, where a president can generally act decisively without congressional backing. If Congress does resist, it can be painted as playing politics with national security. Since Vietnam, this has been a strategy Republican presidents have used, painting Democratic Congresses as weak on national security.
   There is a problem in Obama choosing the second strategy. For Republicans, this strategy plays to their core constituency, for whom national security is a significant issue. It also is an effective tool to reach into the center. The same isn’t true for the Democrats. Obama’s Afghanistan policy has already alienated the Democratic left wing, and the core of the Democratic Party is primarily interested in economic and social issues. The problem for Obama is that focusing on foreign policy at the expense of economic and