Early Bird summary
Wednesday’s Early Bird leads with a story from USA Today reporting that U.S. combat deaths in Iraq have flattened at the lowest level since the war began six years ago Thursday, and the Navy has not lost a member to combat in more than a year.Three Marines have been killed in combat since August, and none since December, records show. The Air Force hasn't had a combat death since April, and the Navy since February 2008.
The Washington Times reports that militants struck twice within 24 hours and destroyed Afghan-bound heavy military vehicles and supplies.The attacks on NATO's supply route followed a respite of several months and appeared to catch authorities by surprise.The spokesman of the North West Frontier Province (NWFP) Ministry of Information declined to comment on the incidents. The inspector general of police in the province, Malik Naveed, recently had claimed to have successfully prevented attacks on NATO supplies after hundreds of such assaults in 2008.
The Jim Lehrer News Hour conducted an interview with U.S. Army Gen. David McKiernan, the top American and NATO commander in Afghanistan on Sunday. A transcript of the interview may be read at this link.
President Obama and his national security advisers are considering expanding the American covert war in Pakistan far beyond the unruly tribal areas to strike at a different center of Taliban power in Baluchistan, where top Taliban leaders are orchestrating attacks into southern Afghanistan, according to the New York Times.According to senior administration officials, two of the high-level reports on Pakistan and Afghanistan that have been forwarded to the White House in recent weeks have called for broadening the target area to include a major insurgent sanctuary in and around the city of Quetta.
The Philadelphia Inquirer reports that Russia's defense minister yesterday accused the United States of beefing up its military presence near Russian borders and poaching for mineral wealth there, signaling that Moscow could take a tough stance in talks with the Obama administration.Anatoly Serdyukov's statement - made alongside President Dmitry A. Medvedev at a meeting of the military's top brass - reflected entrenched Russian suspicions despite President Obama's desire to improve relations with Moscow.
Meanwhile, the Washington Post reports that Russian President Dmitry Medvedev vowed Tuesday to press ahead with an ambitious overhaul of Russia's armed forces despite the nation's economic problems and vocal opposition from within the military. Medvedev promised weapons upgrades but also endorsed organizational changes that will cut the officer corps by more than half, or as many as 200,000 positions.The plan, first disclosed in October, envisions the most dramatic transformation of the Russian military since World War II, abandoning a structure designed to mobilize large numbers of new troops to fight a major war and replacing it with a leaner, standing army that can respond more quickly to local conflicts. Thousands of combat units staffed now only with officers would be eliminated, and the military's four-level command structure would be trimmed to a three-tier hierarchy.
A military appeals court Tuesday upheld the dismissal of war crimes charges against Marine Lt. Col. Jeffrey Chessani, the highest-ranking Marine charged in the 2005 killing of 24 civilians in Haditha, Iraq, according to the San Diego Tribune.The court agreed with a military judge at Camp Pendleton who ruled in June that there was the appearance of "unlawful command influence" in the matter because a Marine lawyer who investigated the case had sat in on meetings where it was discussed with the general who later decided to charge Chessani and seven other Marines.The Marine Corps can appeal Tuesday's ruling to a higher military court or to the U.S. Supreme Court. A spokesman for the Marine Corps Forces Central Command said no decision had been made.
Reuters reports that Iran is increasing its activity in Latin America and the Caribbean, including actions aimed at supporting the Lebanese militant group Hezbollah, a top U.S. military commander said on Tuesday.Navy Admiral James Stavridis, who oversees U.S. military interests in the region as head of U.S. Southern Command, also said Hezbollah was linked to drug-trafficking in Colombia.Media summary
1. Leading newspaper headlines: The Washington Post, Los Angeles Times, and New York Times lead with the continuing outrage over the bonuses paid by American International Group last week. (Slate Magazine)
2. Pakistan rejects U.S. strike report: Pakistan's foreign ministry has dismissed a newspaper report suggesting the US is considering expanding military operations in Pakistan. (BBC)
3. Egypt seeks softer U.S. Hamas line: Egypt's intelligence chief is visiting Washington in what officials say is a push for a more flexible US stance on Hamas, to aid Palestinian unity talks. (BBC)
Leading newspaper headlines
The Washington Post, Los Angeles Times, and New York Times lead with the continuing outrage over the bonuses paid by American International Group last week. This controversy isn't going anywhere anytime soon, and new details seem to come out daily that only help to further fuel the fire. New York Attorney General Andrew Cuomo revealed yesterday that the $165 million in bonuses went to 418 AIG employees, including $33.6 million handed out to 52 people who have left the company. A total of 73 AIG employees received bonuses of $1 million or more, including 11 who are no longer working at the insurance giant. Trying to calm the uproar that has broken out among lawmakers and the public, Treasury Secretary Timothy Geithner said he would deduct the cost of the bonuses from the pending $30 billion cash infusion to the insurance giant that would bring the total amount of taxpayer money that AIG has received to around $200 billion.
The Wall Street Journal leads its world-wide newsbox with Russian President Dmitry Medvedev striking "a Cold War tone" as he pledged to go ahead with rearmament plans in response to what he said were NATO's plans to expand close to Russia's border. The comments were made a few weeks before Medvedev is scheduled to meet with President Obama for the first time and were widely seen as a negotiating tactic. USA Today leads with word that Transportation Security Administration officers will be stepping up efforts to screen randomly selected passengers before they board a plane. The TSA has already been carrying out this double-screening at airport gates, but passengers can expect to see more of their fellow fliers pulled aside while boarding, particularly in what are described as riskier flights.
Leading Democrats tried to "get out in front of the mounting public furor," as the NYT puts it, over AIG by proposing a variety of measures that would use the tax code to punish those who refuse to voluntarily give back their bonuses. At least three separate bills have been introduced in the House that would impose a tax rate of anywhere from 95 percent to 100 percent on the AIG bonuses. For example, one of these bills, introduced by Democratic Rep. Gary Peters of Michigan, would impose a 60 percent surtax on top of the normal 35 percent income tax on bonuses over a certain amount paid by any company in which the government holds at least a 79 percent equity stake. "AIG is the only company in that category," explains the LAT.
The Senate is also drafting similar legislation, and one proposal by the chairman of the Senate Finance Committee would impose large excise taxes on bonuses awarded by not only AIG, but any company that receives bailout funds. The NYT, however, points out that this may be an imperfect solution because some of the AIG employees who received the money are foreigners living abroad and so wouldn't have to pay U.S. taxes regardless. Republicans were less enthusiastic about endorsing these tax proposals and warned they could run into some legal issues. Whether such a move would be legal is unclear. One expert tells the LAT that "Congress can tax anything they damn well please," but others said that directly singling out AIG executives could raise constitutional issues.
Republicans didn't issue any proposals to get the bonus money back but loudly questioned what these payments say about oversight of the companies that have received taxpayer cash and made it clear they would reject any more bailout requests. "No more bailouts," House Minority Whip Eric Cantor said. "The American people have had it. They want this Congress to get back to fiscal discipline and restraint and the belief that the freedom to succeed includes the freedom to fail."
A group of prominent Democratic senators wrote to AIG Chief Executive Edward Liddy urging that the bonuses be repaid. You can bet that the issue will be brought up again today when Liddy testifies before a House subcommittee. The WP reports that Liddy is expected to send out a letter to AIG employees asking them to return the bonus payments.
In preparation for his congressional hearing, Liddy, who was appointed head of AIG by the Bush administration in September and receives an annual salary of $1, writes an op-ed piece in the WP today. Liddy says that he "would never have approved the retention contracts" and assures readers that making the payments "was distasteful." Liddy also insists AIG has every intention to return all the taxpayer money to the government and is "making progress" toward that goal. The most important lesson that must be learned from the AIG debacle is that the government must put in place "safeguards against the systemic consequences of failures of large, interconnected financial institutions." As long as the American people are patient and the government continues to support the company's efforts, "we can resolve AIG's challenges and help its businesses contribute to a global economic recovery."
Just because Liddy agreed to come out of retirement for an unenviable $1-a-year job doesn't mean he's above criticism. The WP's Steven Pearlstein writes that Liddy could have come up with several different ways to renegotiate the contracts before last week's deadline, but so far all Liddy "seems to have served up is a litany of complaints about what a bad hand he was dealt." At the very least, Liddy could have been more transparent about the company's situation with the taxpayers. "Instead, [Liddy] has not only left us wondering whose side he's really on, but also, because of the bonus backlash, he has managed to put the entire financial rescue effort in political jeopardy." Liddy isn't the "only one on Wall Street who can't quite grasp the idea that extraordinary times require a different way of doing things." Wall Street executives still act as if it's their duty to maximize personal profits, even if it's the taxpayers who will be footing the bill.
In its daily front-page chart, USAT reveals that only 26 percent of Americans think people on Wall Street are "as honest and moral as other people." In 2006, that number was 41 percent.
Just in case there isn't enough outrage over the AIG bailout, the WSJ goes high with word that some of the taxpayer money that went to AIG could be used to pay hedge funds that made bets against the U.S. housing market. Basically that means that while the U.S. government is devoting billions to try to lift the housing market, it is also "putting up cash that could be used to pay off investors who bet housing prices would tumble and many mortgage holders would default," explains the WSJ. Although the transactions were perfectly legal, they do illustrate how "AIG strayed from its core business" and was heavily involved in financial speculation. An investment consultant says that, in essence, taxpayers now have to pay AIG's "gambling debts."
The WP takes a look at how several financial firms are looking on at the outrage over AIG's bonuses and are suggesting they want to stay as far away from it as possible. If enough financial firms are actually serious about this, it could eventually threaten the government's efforts to persuade private investors to get involved in its numerous economic recovery programs. "Am I afraid of the populist outrage? Yes," said the chief executive of a private-equity firm that is considering participating in the government's efforts to thaw the frozen credit markets. Some say they'll wait to see how early participants fare before jumping in.
The NYT off-leads word that the Obama administration is weighing whether it should extend the reach of the missile strikes being carried out by CIA-operated drones into areas beyond the lawless tribal regions of Pakistan. Some officials want to expand the covert war in Pakistan to include the area in and around the city of Quetta, which the paper describes as "a major insurgent sanctuary." There are fears that extending the strikes would increase tensions with Pakistan's government, which often complains the ongoing strikes violate the country's sovereignty. But some officials say that extending the reach of the drones is imperative because many Taliban and al-Qaida leaders have fled the tribal regions, and the Pakistani military seems unable or unwilling to stop the spreading insurgency.
The NYT's Thomas Friedman writes that the "the anger level in the country is reaching a Bonfire of the Vanities, get-out-the-pitchforks danger level." There are several reasons why this is dangerous, but mostly because it "could overwhelm the still really difficult but critically important things we must do in the next few weeks to defuse this financial crisis." If there's any hope to fix the financial system, it's likely that Obama will need to request the extra $750 billion it has already warned Congress about in order to get the toxic assets out of banks' balance sheets. "The only person with the clout to sell something this big is President Obama." Sure, everyone will have to pitch in, but ultimately Obama will be the one who has to "persuade people that this is the least unfair and most effective solution," writes Friedman. "It will be his first big leadership test."
To top of document
Pakistan rejects US strike report
Pakistan is critical of the US drone attacks
Pakistan's foreign ministry has dismissed a newspaper report suggesting the US is considering expanding military operations in Pakistan.
The New York Times quotes unnamed officials as saying that two reports sent to the White House have called for air strikes in Balochistan province.
To date, US strikes have been confined to tribal areas on the Afghan border.
Pakistan is critical of the tactic, saying civilians are often killed and it fuels anti-American sentiment.
There have been at least six drone attacks on Pakistani territory since Barack Obama became US president in January.
'Counter-productive'
"We have seen the report. It appears to be speculative and we cannot comment on speculations," the AFP news agency quotes foreign ministry spokesman Abdul Basit as saying.
Foreign Minister Shah Mehmood Qureshi told reporters the Pakistani government had told the Americans that drone attacks were "counter-productive".
"They have some positive aspects as well but they cause destabilisation in Pakistan. We have told the Americans that they should arrive at a policy after considering both costs and benefits of these attacks," he said.
Mr Qureshi recently visited the US to participate in talks aimed at devising a new US policy towards Afghanistan and Pakistan.
The New York Times reports that President Obama and his national security advisers are considering expanding the "American covert war in Pakistan far beyond the unruly tribal areas".
The report suggests plans to strike the Taleban in Balochistan, "where top Taleban leaders are orchestrating attacks into southern Afghanistan".
The newspaper, quoting unnamed senior administration officials, says two high-level reports on Pakistan and Afghanistan forwarded to the White House in recent weeks have "called for broadening the target area to include a major insurgent sanctuary in and around the city of Quetta".
There have been several missile strikes in Pakistan's tribal districts bordering Afghanistan since August last year and the attacks are believed to have been carried out by US drones, although this has never been formally acknowledged by the US authorities.
Pakistan's government has strongly criticised the attacks, which have led to an increase in anti-American feeling in the country.
To top of document
Egypt seeks softer US Hamas line
Mr Suleiman was in Sudan this week but went to Washington unannounced
Egypt's intelligence chief is visiting Washington in what officials say is a push for a more flexible US stance on Hamas, to aid Palestinian unity talks.
The US, EU and UN will not deal with the militant rulers of Gaza unless they reject violence and recognise Israel.
Talks in Cairo to end the rift between Hamas and the Palestinian Authority have faltered over the issue.
The division between the factions is also a major barrier to reconstruction in Gaza after Israel's offensive.
Cairo's influential head of intelligence, Omar Suleiman, is the chief mediator in the talks aimed at forging a Palestinian national unity government.
The US has said it will only deal with a national unity government that includes Hamas if it accepts the conditions.
An unnamed US official told AFP news agency that Mr Suleiman had met US Middle East envoy George Mitchell on Tuesday and might meet Secretary of State Hillary Clinton on Wednesday.
Egyptian and Palestinian officials told AP news agency that Egypt is suggesting the US would accept a commitment from Hamas to "respect" existing Palestinian agreements with Israel, rather than "commit" to them.
The international community wants Hamas to accept existing Palestinian agreements with Israel, such as the Olso accords, in which the Palestine Liberation Organisation (PLO) recognised the right of the state of Israel to exist and renounced violence.
Hamas's charter calls for the destruction of Israel, although the group has also offered a long-term truce if Israel withdraws to its pre-5 June 1967 borders.
Egyptian Foreign Minister Ahmed Abul Gheit is currently in Brussels for talks with officials including European Union foreign policy chief Javier Solana.
Israel and the international community want reconstruction money to be funnelled through the PA.
Israel also wants the PA involved in any agreement to open the crossings into Gaza, which Israel has kept closed to all but basic aid since Hamas consolidated its control of Gaza by force in 2007.
The division between Hamas and PA President Mahmoud Abbas's Fatah faction is deep, including many other issues such as reform of the Palestinian security services and the PLO, and the timing of fresh Palestinian elections.
A previous unity agreement fell apart after Israel and its international backers refused to deal with Hamas.
Inter-factional fighting in Gaza came to a head in the summer of 2007 when Hamas fighters ousted the pro-Fatah security forces and overthrew PA control.
As well as continued tension, both sides have been accused of conducting politically motivated arrests and the torture of rival faction members.
Egypt revived the call for Palestinian reconciliation talks in November.
However, Hamas withdrew from the talks, complaining that Fatah continued to arrest Hamas members in the West Bank.
A fresh push for reconciliation was launched after Israel's three-week military offensive in Gaza, which ended on 18 January.
To top of document
Wednesday’s Early Bird leads with a story from USA Today reporting that U.S. combat deaths in Iraq have flattened at the lowest level since the war began six years ago Thursday, and the Navy has not lost a member to combat in more than a year.Three Marines have been killed in combat since August, and none since December, records show. The Air Force hasn't had a combat death since April, and the Navy since February 2008.
The Washington Times reports that militants struck twice within 24 hours and destroyed Afghan-bound heavy military vehicles and supplies.The attacks on NATO's supply route followed a respite of several months and appeared to catch authorities by surprise.The spokesman of the North West Frontier Province (NWFP) Ministry of Information declined to comment on the incidents. The inspector general of police in the province, Malik Naveed, recently had claimed to have successfully prevented attacks on NATO supplies after hundreds of such assaults in 2008.
The Jim Lehrer News Hour conducted an interview with U.S. Army Gen. David McKiernan, the top American and NATO commander in Afghanistan on Sunday. A transcript of the interview may be read at this link.
President Obama and his national security advisers are considering expanding the American covert war in Pakistan far beyond the unruly tribal areas to strike at a different center of Taliban power in Baluchistan, where top Taliban leaders are orchestrating attacks into southern Afghanistan, according to the New York Times.According to senior administration officials, two of the high-level reports on Pakistan and Afghanistan that have been forwarded to the White House in recent weeks have called for broadening the target area to include a major insurgent sanctuary in and around the city of Quetta.
The Philadelphia Inquirer reports that Russia's defense minister yesterday accused the United States of beefing up its military presence near Russian borders and poaching for mineral wealth there, signaling that Moscow could take a tough stance in talks with the Obama administration.Anatoly Serdyukov's statement - made alongside President Dmitry A. Medvedev at a meeting of the military's top brass - reflected entrenched Russian suspicions despite President Obama's desire to improve relations with Moscow.
Meanwhile, the Washington Post reports that Russian President Dmitry Medvedev vowed Tuesday to press ahead with an ambitious overhaul of Russia's armed forces despite the nation's economic problems and vocal opposition from within the military. Medvedev promised weapons upgrades but also endorsed organizational changes that will cut the officer corps by more than half, or as many as 200,000 positions.The plan, first disclosed in October, envisions the most dramatic transformation of the Russian military since World War II, abandoning a structure designed to mobilize large numbers of new troops to fight a major war and replacing it with a leaner, standing army that can respond more quickly to local conflicts. Thousands of combat units staffed now only with officers would be eliminated, and the military's four-level command structure would be trimmed to a three-tier hierarchy.
A military appeals court Tuesday upheld the dismissal of war crimes charges against Marine Lt. Col. Jeffrey Chessani, the highest-ranking Marine charged in the 2005 killing of 24 civilians in Haditha, Iraq, according to the San Diego Tribune.The court agreed with a military judge at Camp Pendleton who ruled in June that there was the appearance of "unlawful command influence" in the matter because a Marine lawyer who investigated the case had sat in on meetings where it was discussed with the general who later decided to charge Chessani and seven other Marines.The Marine Corps can appeal Tuesday's ruling to a higher military court or to the U.S. Supreme Court. A spokesman for the Marine Corps Forces Central Command said no decision had been made.
Reuters reports that Iran is increasing its activity in Latin America and the Caribbean, including actions aimed at supporting the Lebanese militant group Hezbollah, a top U.S. military commander said on Tuesday.Navy Admiral James Stavridis, who oversees U.S. military interests in the region as head of U.S. Southern Command, also said Hezbollah was linked to drug-trafficking in Colombia.Media summary
1. Leading newspaper headlines: The Washington Post, Los Angeles Times, and New York Times lead with the continuing outrage over the bonuses paid by American International Group last week. (Slate Magazine)
2. Pakistan rejects U.S. strike report: Pakistan's foreign ministry has dismissed a newspaper report suggesting the US is considering expanding military operations in Pakistan. (BBC)
3. Egypt seeks softer U.S. Hamas line: Egypt's intelligence chief is visiting Washington in what officials say is a push for a more flexible US stance on Hamas, to aid Palestinian unity talks. (BBC)
Leading newspaper headlines
The Washington Post, Los Angeles Times, and New York Times lead with the continuing outrage over the bonuses paid by American International Group last week. This controversy isn't going anywhere anytime soon, and new details seem to come out daily that only help to further fuel the fire. New York Attorney General Andrew Cuomo revealed yesterday that the $165 million in bonuses went to 418 AIG employees, including $33.6 million handed out to 52 people who have left the company. A total of 73 AIG employees received bonuses of $1 million or more, including 11 who are no longer working at the insurance giant. Trying to calm the uproar that has broken out among lawmakers and the public, Treasury Secretary Timothy Geithner said he would deduct the cost of the bonuses from the pending $30 billion cash infusion to the insurance giant that would bring the total amount of taxpayer money that AIG has received to around $200 billion.
The Wall Street Journal leads its world-wide newsbox with Russian President Dmitry Medvedev striking "a Cold War tone" as he pledged to go ahead with rearmament plans in response to what he said were NATO's plans to expand close to Russia's border. The comments were made a few weeks before Medvedev is scheduled to meet with President Obama for the first time and were widely seen as a negotiating tactic. USA Today leads with word that Transportation Security Administration officers will be stepping up efforts to screen randomly selected passengers before they board a plane. The TSA has already been carrying out this double-screening at airport gates, but passengers can expect to see more of their fellow fliers pulled aside while boarding, particularly in what are described as riskier flights.
Leading Democrats tried to "get out in front of the mounting public furor," as the NYT puts it, over AIG by proposing a variety of measures that would use the tax code to punish those who refuse to voluntarily give back their bonuses. At least three separate bills have been introduced in the House that would impose a tax rate of anywhere from 95 percent to 100 percent on the AIG bonuses. For example, one of these bills, introduced by Democratic Rep. Gary Peters of Michigan, would impose a 60 percent surtax on top of the normal 35 percent income tax on bonuses over a certain amount paid by any company in which the government holds at least a 79 percent equity stake. "AIG is the only company in that category," explains the LAT.
The Senate is also drafting similar legislation, and one proposal by the chairman of the Senate Finance Committee would impose large excise taxes on bonuses awarded by not only AIG, but any company that receives bailout funds. The NYT, however, points out that this may be an imperfect solution because some of the AIG employees who received the money are foreigners living abroad and so wouldn't have to pay U.S. taxes regardless. Republicans were less enthusiastic about endorsing these tax proposals and warned they could run into some legal issues. Whether such a move would be legal is unclear. One expert tells the LAT that "Congress can tax anything they damn well please," but others said that directly singling out AIG executives could raise constitutional issues.
Republicans didn't issue any proposals to get the bonus money back but loudly questioned what these payments say about oversight of the companies that have received taxpayer cash and made it clear they would reject any more bailout requests. "No more bailouts," House Minority Whip Eric Cantor said. "The American people have had it. They want this Congress to get back to fiscal discipline and restraint and the belief that the freedom to succeed includes the freedom to fail."
A group of prominent Democratic senators wrote to AIG Chief Executive Edward Liddy urging that the bonuses be repaid. You can bet that the issue will be brought up again today when Liddy testifies before a House subcommittee. The WP reports that Liddy is expected to send out a letter to AIG employees asking them to return the bonus payments.
In preparation for his congressional hearing, Liddy, who was appointed head of AIG by the Bush administration in September and receives an annual salary of $1, writes an op-ed piece in the WP today. Liddy says that he "would never have approved the retention contracts" and assures readers that making the payments "was distasteful." Liddy also insists AIG has every intention to return all the taxpayer money to the government and is "making progress" toward that goal. The most important lesson that must be learned from the AIG debacle is that the government must put in place "safeguards against the systemic consequences of failures of large, interconnected financial institutions." As long as the American people are patient and the government continues to support the company's efforts, "we can resolve AIG's challenges and help its businesses contribute to a global economic recovery."
Just because Liddy agreed to come out of retirement for an unenviable $1-a-year job doesn't mean he's above criticism. The WP's Steven Pearlstein writes that Liddy could have come up with several different ways to renegotiate the contracts before last week's deadline, but so far all Liddy "seems to have served up is a litany of complaints about what a bad hand he was dealt." At the very least, Liddy could have been more transparent about the company's situation with the taxpayers. "Instead, [Liddy] has not only left us wondering whose side he's really on, but also, because of the bonus backlash, he has managed to put the entire financial rescue effort in political jeopardy." Liddy isn't the "only one on Wall Street who can't quite grasp the idea that extraordinary times require a different way of doing things." Wall Street executives still act as if it's their duty to maximize personal profits, even if it's the taxpayers who will be footing the bill.
In its daily front-page chart, USAT reveals that only 26 percent of Americans think people on Wall Street are "as honest and moral as other people." In 2006, that number was 41 percent.
Just in case there isn't enough outrage over the AIG bailout, the WSJ goes high with word that some of the taxpayer money that went to AIG could be used to pay hedge funds that made bets against the U.S. housing market. Basically that means that while the U.S. government is devoting billions to try to lift the housing market, it is also "putting up cash that could be used to pay off investors who bet housing prices would tumble and many mortgage holders would default," explains the WSJ. Although the transactions were perfectly legal, they do illustrate how "AIG strayed from its core business" and was heavily involved in financial speculation. An investment consultant says that, in essence, taxpayers now have to pay AIG's "gambling debts."
The WP takes a look at how several financial firms are looking on at the outrage over AIG's bonuses and are suggesting they want to stay as far away from it as possible. If enough financial firms are actually serious about this, it could eventually threaten the government's efforts to persuade private investors to get involved in its numerous economic recovery programs. "Am I afraid of the populist outrage? Yes," said the chief executive of a private-equity firm that is considering participating in the government's efforts to thaw the frozen credit markets. Some say they'll wait to see how early participants fare before jumping in.
The NYT off-leads word that the Obama administration is weighing whether it should extend the reach of the missile strikes being carried out by CIA-operated drones into areas beyond the lawless tribal regions of Pakistan. Some officials want to expand the covert war in Pakistan to include the area in and around the city of Quetta, which the paper describes as "a major insurgent sanctuary." There are fears that extending the strikes would increase tensions with Pakistan's government, which often complains the ongoing strikes violate the country's sovereignty. But some officials say that extending the reach of the drones is imperative because many Taliban and al-Qaida leaders have fled the tribal regions, and the Pakistani military seems unable or unwilling to stop the spreading insurgency.
The NYT's Thomas Friedman writes that the "the anger level in the country is reaching a Bonfire of the Vanities, get-out-the-pitchforks danger level." There are several reasons why this is dangerous, but mostly because it "could overwhelm the still really difficult but critically important things we must do in the next few weeks to defuse this financial crisis." If there's any hope to fix the financial system, it's likely that Obama will need to request the extra $750 billion it has already warned Congress about in order to get the toxic assets out of banks' balance sheets. "The only person with the clout to sell something this big is President Obama." Sure, everyone will have to pitch in, but ultimately Obama will be the one who has to "persuade people that this is the least unfair and most effective solution," writes Friedman. "It will be his first big leadership test."
To top of document
Pakistan rejects US strike report
Pakistan is critical of the US drone attacks
Pakistan's foreign ministry has dismissed a newspaper report suggesting the US is considering expanding military operations in Pakistan.
The New York Times quotes unnamed officials as saying that two reports sent to the White House have called for air strikes in Balochistan province.
To date, US strikes have been confined to tribal areas on the Afghan border.
Pakistan is critical of the tactic, saying civilians are often killed and it fuels anti-American sentiment.
There have been at least six drone attacks on Pakistani territory since Barack Obama became US president in January.
'Counter-productive'
"We have seen the report. It appears to be speculative and we cannot comment on speculations," the AFP news agency quotes foreign ministry spokesman Abdul Basit as saying.
Foreign Minister Shah Mehmood Qureshi told reporters the Pakistani government had told the Americans that drone attacks were "counter-productive".
"They have some positive aspects as well but they cause destabilisation in Pakistan. We have told the Americans that they should arrive at a policy after considering both costs and benefits of these attacks," he said.
Mr Qureshi recently visited the US to participate in talks aimed at devising a new US policy towards Afghanistan and Pakistan.
The New York Times reports that President Obama and his national security advisers are considering expanding the "American covert war in Pakistan far beyond the unruly tribal areas".
The report suggests plans to strike the Taleban in Balochistan, "where top Taleban leaders are orchestrating attacks into southern Afghanistan".
The newspaper, quoting unnamed senior administration officials, says two high-level reports on Pakistan and Afghanistan forwarded to the White House in recent weeks have "called for broadening the target area to include a major insurgent sanctuary in and around the city of Quetta".
There have been several missile strikes in Pakistan's tribal districts bordering Afghanistan since August last year and the attacks are believed to have been carried out by US drones, although this has never been formally acknowledged by the US authorities.
Pakistan's government has strongly criticised the attacks, which have led to an increase in anti-American feeling in the country.
To top of document
Egypt seeks softer US Hamas line
Mr Suleiman was in Sudan this week but went to Washington unannounced
Egypt's intelligence chief is visiting Washington in what officials say is a push for a more flexible US stance on Hamas, to aid Palestinian unity talks.
The US, EU and UN will not deal with the militant rulers of Gaza unless they reject violence and recognise Israel.
Talks in Cairo to end the rift between Hamas and the Palestinian Authority have faltered over the issue.
The division between the factions is also a major barrier to reconstruction in Gaza after Israel's offensive.
Cairo's influential head of intelligence, Omar Suleiman, is the chief mediator in the talks aimed at forging a Palestinian national unity government.
The US has said it will only deal with a national unity government that includes Hamas if it accepts the conditions.
An unnamed US official told AFP news agency that Mr Suleiman had met US Middle East envoy George Mitchell on Tuesday and might meet Secretary of State Hillary Clinton on Wednesday.
Egyptian and Palestinian officials told AP news agency that Egypt is suggesting the US would accept a commitment from Hamas to "respect" existing Palestinian agreements with Israel, rather than "commit" to them.
The international community wants Hamas to accept existing Palestinian agreements with Israel, such as the Olso accords, in which the Palestine Liberation Organisation (PLO) recognised the right of the state of Israel to exist and renounced violence.
Hamas's charter calls for the destruction of Israel, although the group has also offered a long-term truce if Israel withdraws to its pre-5 June 1967 borders.
Egyptian Foreign Minister Ahmed Abul Gheit is currently in Brussels for talks with officials including European Union foreign policy chief Javier Solana.
Israel and the international community want reconstruction money to be funnelled through the PA.
Israel also wants the PA involved in any agreement to open the crossings into Gaza, which Israel has kept closed to all but basic aid since Hamas consolidated its control of Gaza by force in 2007.
The division between Hamas and PA President Mahmoud Abbas's Fatah faction is deep, including many other issues such as reform of the Palestinian security services and the PLO, and the timing of fresh Palestinian elections.
A previous unity agreement fell apart after Israel and its international backers refused to deal with Hamas.
Inter-factional fighting in Gaza came to a head in the summer of 2007 when Hamas fighters ousted the pro-Fatah security forces and overthrew PA control.
As well as continued tension, both sides have been accused of conducting politically motivated arrests and the torture of rival faction members.
Egypt revived the call for Palestinian reconciliation talks in November.
However, Hamas withdrew from the talks, complaining that Fatah continued to arrest Hamas members in the West Bank.
A fresh push for reconciliation was launched after Israel's three-week military offensive in Gaza, which ended on 18 January.
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