Subway Founder: Subway Would Not Exist If Started Today Due to Government Regulations

President and founder of Subway Fred Deluca described some of the challenges payroll tax increases and Obamacare have presented small business franchisee owners Wednesday on CNBC.

Deluca said the number one issue facing Subway franchisee owners is how Obamacare will impact their expenses, noting any increase in costs will be passed along to the consumer through higher prices.

Additionally, when asked about the modern business climate for young entrepreneurs, the Subway founder stated “Subway would not exist” if he started it today due to onerous government regulations:

SIMON HOBBS: It’s 13 years since you wrote the book “Start Small, Finish Big” which was about grass roots entrepreneurship. Do you think the environment for those chasing the American dream by setting up their own business has gotten worse or better in those 13 years?

FRED DELUCA: It’s continuously gotten worse, because there’s more and more regulations. It’s tougher for people to get into business. Especially a small business. I tell you, if I started Subway today, Subway would not exist, because I had an easy time of it in the ’60s when I started. I just see a continuous increase in regulation.
Freebeacon

Death by a thousand paper cuts

Woodward at war

Bob Woodward called a senior White House official last week to tell him that in a piece in that weekend’s Washington Post, he was going to question President Barack Obama’s account of how sequestration came about - and got a major-league brushback. The Obama aide “yelled at me for about a half hour,” Woodward told us in an hour-long interview yesterday around the Georgetown dining room table where so many generations of Washington’s powerful have spilled their secrets.

Digging into one of his famous folders, Woodward said the tirade was followed by a page-long email from the aide, one of the four or five administration officials most closely involved in the fiscal negotiations with the Hill. “I apologize for raising my voice in our conversation today,” the official typed. “You’re focusing on a few specific trees that give a very wrong impression of the forest. But perhaps we will just not see eye to eye here. … I think you will regret staking out that claim.”

Woodward repeated the last sentence, making clear he saw it as a veiled threat. “ ‘You’ll regret.’ Come on,” he said. “I think if Obama himself saw the way they’re dealing with some of this, he would say, ‘Whoa, we don’t tell any reporter ‘you’re going to regret challenging us.’ ”

(WATCH: Bob Woodward blasts President Obama ‘madness’)

“They have to be willing to live in the world where they’re challenged,” Woodward continued in his calm, instantly recognizable voice. “I’ve tangled with lots of these people. But suppose there’s a young reporter who’s only had a couple of years — or 10 years’ — experience and the White House is sending him an email saying, ‘You’re going to regret this.’ You know, tremble, tremble. I don’t think it’s the way to operate.”

A White House official said: "Of course no threat was intended. As Mr. Woodward noted, the email from the aide was sent to apologize for voices being raised in their previous conversation. The note suggested that Mr. Woodward would regret the observation."

Woodward — first in “The Price of Politics,” his bestseller on the failed quest for a grand budget bargain, and later with his opinion piece in The Post — makes plain that sequestration was an idea crafted by the White House. Obama personally approved the plan and later signed it into law. Woodward was right, several congressional officials involved in the talks told us.

(Also on POLITICO: Right cheers Bob Woodward ‘fact check’)

And that contention has made Woodward, once Public Enemy Number One to a generation of Republicans, the unlikely darling of the right wing. Conservatives suddenly swoon over him, with his stepped-up appearances on Fox News and starring role in GOP press releases. And while White House officials are certainly within their rights to yell at any journalist, including Bob Woodward, this very public battle with a Washington legend has become a major distraction at a pivotal moment for the president.

The feud also feeds a larger narrative because, like many others, Woodward thinks this is a very thin-skinned White House that does not like being challenged on the facts. He said that explains the senior aide’s in-your-face email. “I think when they get their rear end in a crack here, they become defensive,” he said. “This could be a huge issue if the economy takes a hit. And people are going to go back and say exactly what happened and who did it and so forth.”

The Woodward reporting has caused the White House spin machine to sputter at a crucial time. The president was running around the country, campaign-style, warning that Republicans were at fault for the massive cuts set to hit Friday. What Obama never says: it was his own staff that proposed sequestration, and the tax hikes he now proposes – aimed at replacing half of the cuts — were never part of that very specific plan.

(PHOTOS: What they’re saying about sequestration)

The White House instead has, with great success, fudged the facts. The administration has convinced a majority of the country that Republicans are more to blame by emphasizing that Republicans voted for the plan. Which they did — after Obama conceived it.

The truth is that Obama and Republicans supported it because everyone believed it was a such a stupid idea that the grown-ups in Washington would never actually let it happen. They thought Obama and Congress would come up with a grand bargain on spending, entitlement cuts and tax increases, instead of allowing the sequestration ax to fall. They were wrong.

So the blame game is full swing – and Woodward is smack in the middle of it. The Obama White House is out to discredit him. Behind the scenes, Obama allies are spreading word that the Woodward book broadly — and his reporting on sequestration specifically — are misleading because Republicans, especially House Majority Leader Eric Cantor of Virginia, were so clearly among the chief sources.

It is no secret on Capitol Hill that Cantor and his staff cooperated extensively with Woodward. It is fairly obvious as you breeze through the opening chapters of the book. But we have talked with many Democrats and Republicans who cooperated with the book. And all of them say that while they might dispute some of the broader analytical points Woodward makes, the play-by-play is basically spot on.

Watching and now having interviewed Woodward, it is easy to see why White House officials get worked about him. He clearly is skeptical of Obama’s approach to the job. “I’m not sure he fully understands the power he has,” Woodward said. “He sees that the power is the public megaphone going around to these campaign-like events, which is real, but the audience he needs to deal with is on this issue of the sequester and these budget issues is John Boehner and Mitch McConnell and Harry Reid and Nancy Pelosi.”

Woodward also said that based on his reporting for the book, Obama deserves more of the blame for scuttling the grand bargain of 2011 that would have put sequestration to rest long ago. “He changed the deal and it blew up,” Woodward said. “I mean, you look at the facts, and even by the White House accounts by his aides, he was making a last-minute change.”

Woodward thinks there is still a grand bargain to be had between Obama and Boehner, with tax reform as a huge component. “Sit down and work through this,” he said. “I can see exactly how you come up with a deal that would dispose of lots of things.” Woodward, who helped bring down one presidency and has written instant history on every one since, added: “Color me a little baffled. I don’t understand this White House. Do you?”
Politico

Could Hugo Chávez already be dead?

Guillermo Cochez, until recently Panama’s ambassador to the Organization of American States, has been giving interviews to a variety of media outlets saying that Venezuelan president Hugo Chávez is dead.

Chávez went to Cuba in December for cancer surgery and was flown back to Venezuela in the middle of the night on February 18. Information about his health has been largely limited to statements from the Venezuelan authorities, and Cochez claims in this interview with CNN Chile that the Venezuelan leader has in fact been brain-dead since December 30 or 31 (video in Spanish, at 0:54).


He was flown back to Venezuela, Cochez claims, because the Cuban authorities didn’t want him to be disconnected from life-support while in the country. In an interview with La Estrella (Spanish), a Panamanian newspaper, Cochez says that the president’s life-support was switched off four days ago on the orders of his daughters. He would not reveal his sources, but claimed that they are at senior levels in the government, not the opposition.

Cochez, who was dismissed from his post in January after criticizing the OAS for failing to be tougher on Venezuela, has made such claims before. In early January, he told La Estrella that Chávez’s condition was worse than the authorities were admitting. But there is at least one reason to doubt his latest claim.

In the above video, at around 1:30, Cochez says that a photo of Chávez flanked by his daughters, which was released to the press earlier this month, is misleading. “This is a person who had already lost 80 or 90 pounds [and yet] he was very plump, full of vitality… his daughters’ faces don’t correspond to reality, one of them has undergone plastic surgery.” In other words, Cochez seems to be suggesting, the picture was staged long before it was supposedly taken.
QZ

BOB WOODWARD: A 'Very Senior' White House Person Warned Me I'd 'Regret' What I'm Doing

Bob Woodward said this evening on CNN that a "very senior person" at the White House warned him in an email that he would "regret doing this," the same day he has continued to slam President Barack Obama over the looming forced cuts known as the sequester.

CNN host Wolf Blitzer said that the network invited a White House official to debate Woodward on-air, but the White House declined.

"It makes me very uncomfortable to have the White House telling reporters, 'You're going to regret doing something that you believe in,'" Woodward said.

"I think they're confused," Woodward said of the White House's pushback on his reporting.

Earlier today on MSNBC's "Morning Joe," Woodward ripped into Obama in what has become an ongoing feud between the veteran Washington Post journalist and the White House. Woodward said Obama was showing a "kind of madness I haven't seen in a long time" for a decision not to deploy an aircraft carrier to the Persian Gulf because of budget concerns.

The Defense Department said in early February that it would not deploy the U.S.S. Harry Truman to the Persian Gulf, citing budget concerns relating to the looming cuts known as the sequester.

"Can you imagine Ronald Reagan sitting there and saying, 'Oh, by the way, I can't do this because of some budget document?'" Woodward said on MSNBC.

"Or George W. Bush saying, 'You know, I'm not going to invade Iraq because I can't get the aircraft carriers I need?'" Or even Bill Clinton saying, 'You know, I'm not going to attack Saddam Hussein's intelligence headquarters,' ... because of some budget document?"

Last weekend, Woodward called out Obama for what he said was "moving the goal posts" on the sequester by requesting that revenue be part of a deal to avert it.
BusinessInsider

Democrats complain about presence of debt clock on Capitol Hill [VIDEO]

Some members of Congress apparently don’t like to be reminded about how much debt the country continues to rack up. During a House Financial Services Committee hearing Tuesday on the budget, two Democrats complained after House Financial Services Committee chairman Jeb Hensarling instructed that two monitors in the hearing room display a real-time running national debt clock. California Rep. Maxine Waters and Minnesota Rep. Keith Ellison both issued complaints about the displays, according to video of the hearing. “Clearly it is a political prop designed to message ideologically,” Ellison said. Waters asked that the debt clock not be on display whenever Democrats spoke, Hensarling said during the hearing. “At the request of the ranking member, the national debt clock will not be put on the screens during Democratic time,” said Hensarling, a Texas Republican. DailyCaller

Father wants school dress code changed after son asked to remove Marines T-shirt

An Illinois father wants a school district to reconsider its dress code after his son was asked to remove a U.S. Marines T-shirt or be suspended, FoxNews.com has learned.

Daniel McIntyre, 44, of Genoa, told FoxNews.com that his 14-year-old son, Michael, was asked to remove the T-shirt by eighth-grade teacher Karen Deverell during reading class at Genoa-Kingston Middle School on Monday. Deverell, citing the school’s dress code, said the garment’s interlocking rifles was problematic and had to be removed from sight, McIntyre said.

“My son is very proud of the Marines, and, in fact, of all the services,” McIntyre said. “So he wears it with pride. There are two rifles crossed underneath the word ‘Marines’ on the shirt, but to me that should be overlooked. It’s more about the Marines instead of the rifles.”


McIntyre said his son was initially threatened with suspension before complying with Deverell’s request to turn it inside out. He has worn the T-shirt to school many times before without incident, McIntyre said.

“He was upset, he couldn’t understand it,” he continued. “He couldn’t understand why a teacher would make him do that.”

Brett McPherson, the school’s principal, referred questions to Genoa-Kingston Superintendent Joe Burgess, who reiterated that the shirt is not in violation of the district’s dress policy.

“We’ve been accused of a lot of things, but our middle school is well-known for its support of the armed forces,” Burgess told FoxNews.com. “That’s why this is so disheartening to all of us.”

Deverell did not inform school officials of the incident, Burgess said, adding that McPherson would have quickly determined the shirt to be a non-issue if consulted.

“Nobody took the next step of asking the principal or making them aware of it,” Burgess said. “The teacher is obviously allowed to question anything they feel might be a violation of dress code, but again, had an administrator been allowed to respond, this could have been taken care of yesterday.”

Students within the district are expected to wear clothing in a “neat, clean and well-fitting manner,” according to a copy of the policy, which was obtained by FoxNews.com. While addressing “violent behavior,” gang symbols and other inappropriate images, it does not explicitly ban images of guns and other weapons.

“Student dress (including accessories) may not advertise, promote, or picture alcoholic beverages, illegal drugs, drug paraphernalia, violent behavior, or other inappropriate images,” it reads. “Student dress (including accessories) may not display lewd, vulgar or obscene or offensive language or symbols, including gang symbols.”

Hats, bandannas and sunglasses are also banned inside the building. Students who violate the dress code will be asked to wear their gym uniform, it reads.

District officials, meanwhile, said its students are dutiful patriots who support U.S. troops as much as they can.

“The students and staff regularly write letters of support to the troops, and hold patriotic ceremonies for Veterans Day and Patriots' Day,” a statement obtained by FoxNews.com reads. “We very much support the armed forces and were disheartened to learn of this matter through the media. The administration and school handbook agree that this shirt is not a violation of the dress code. We also take school safety very earnestly and it needs to be recognized that is a topic that we also take very seriously and support our students and staff in providing a safe environment to learn, teach and work in on a daily basis.”

McIntyre said he believes the incident is likely an overreaction to recent mass shootings, particularly to the Dec. 14, 2012, massacre at Sandy Hook Elementary School in which 20 students and six staffers were killed after Adam Lanza killed his mother at their Connecticut home.

“I backed him up and he knows that,” McIntyre said of his son. “This is not right. This policy that they have in place can obviously be loosely interpreted, so they need to change it.”
FoxNews

Father wants school dress code changed after son asked to remove Marines T-shirt

An Illinois father wants a school district to reconsider its dress code after his son was asked to remove a U.S. Marines T-shirt or be suspended, FoxNews.com has learned.

Daniel McIntyre, 44, of Genoa, told FoxNews.com that his 14-year-old son, Michael, was asked to remove the T-shirt by eighth-grade teacher Karen Deverell during reading class at Genoa-Kingston Middle School on Monday. Deverell, citing the school’s dress code, said the garment’s interlocking rifles was problematic and had to be removed from sight, McIntyre said.

“My son is very proud of the Marines, and, in fact, of all the services,” McIntyre said. “So he wears it with pride. There are two rifles crossed underneath the word ‘Marines’ on the shirt, but to me that should be overlooked. It’s more about the Marines instead of the rifles.”


McIntyre said his son was initially threatened with suspension before complying with Deverell’s request to turn it inside out. He has worn the T-shirt to school many times before without incident, McIntyre said.

“He was upset, he couldn’t understand it,” he continued. “He couldn’t understand why a teacher would make him do that.”

Brett McPherson, the school’s principal, referred questions to Genoa-Kingston Superintendent Joe Burgess, who reiterated that the shirt is not in violation of the district’s dress policy.

“We’ve been accused of a lot of things, but our middle school is well-known for its support of the armed forces,” Burgess told FoxNews.com. “That’s why this is so disheartening to all of us.”

Deverell did not inform school officials of the incident, Burgess said, adding that McPherson would have quickly determined the shirt to be a non-issue if consulted.

“Nobody took the next step of asking the principal or making them aware of it,” Burgess said. “The teacher is obviously allowed to question anything they feel might be a violation of dress code, but again, had an administrator been allowed to respond, this could have been taken care of yesterday.”

Students within the district are expected to wear clothing in a “neat, clean and well-fitting manner,” according to a copy of the policy, which was obtained by FoxNews.com. While addressing “violent behavior,” gang symbols and other inappropriate images, it does not explicitly ban images of guns and other weapons.

“Student dress (including accessories) may not advertise, promote, or picture alcoholic beverages, illegal drugs, drug paraphernalia, violent behavior, or other inappropriate images,” it reads. “Student dress (including accessories) may not display lewd, vulgar or obscene or offensive language or symbols, including gang symbols.”

Hats, bandannas and sunglasses are also banned inside the building. Students who violate the dress code will be asked to wear their gym uniform, it reads.

District officials, meanwhile, said its students are dutiful patriots who support U.S. troops as much as they can.

“The students and staff regularly write letters of support to the troops, and hold patriotic ceremonies for Veterans Day and Patriots' Day,” a statement obtained by FoxNews.com reads. “We very much support the armed forces and were disheartened to learn of this matter through the media. The administration and school handbook agree that this shirt is not a violation of the dress code. We also take school safety very earnestly and it needs to be recognized that is a topic that we also take very seriously and support our students and staff in providing a safe environment to learn, teach and work in on a daily basis.”

McIntyre said he believes the incident is likely an overreaction to recent mass shootings, particularly to the Dec. 14, 2012, massacre at Sandy Hook Elementary School in which 20 students and six staffers were killed after Adam Lanza killed his mother at their Connecticut home.

“I backed him up and he knows that,” McIntyre said of his son. “This is not right. This policy that they have in place can obviously be loosely interpreted, so they need to change it.”
FoxNews

Father wants school dress code changed after son asked to remove Marines T-shirt

An Illinois father wants a school district to reconsider its dress code after his son was asked to remove a U.S. Marines T-shirt or be suspended, FoxNews.com has learned.

Daniel McIntyre, 44, of Genoa, told FoxNews.com that his 14-year-old son, Michael, was asked to remove the T-shirt by eighth-grade teacher Karen Deverell during reading class at Genoa-Kingston Middle School on Monday. Deverell, citing the school’s dress code, said the garment’s interlocking rifles was problematic and had to be removed from sight, McIntyre said.

“My son is very proud of the Marines, and, in fact, of all the services,” McIntyre said. “So he wears it with pride. There are two rifles crossed underneath the word ‘Marines’ on the shirt, but to me that should be overlooked. It’s more about the Marines instead of the rifles.”


McIntyre said his son was initially threatened with suspension before complying with Deverell’s request to turn it inside out. He has worn the T-shirt to school many times before without incident, McIntyre said.

“He was upset, he couldn’t understand it,” he continued. “He couldn’t understand why a teacher would make him do that.”

Brett McPherson, the school’s principal, referred questions to Genoa-Kingston Superintendent Joe Burgess, who reiterated that the shirt is not in violation of the district’s dress policy.

“We’ve been accused of a lot of things, but our middle school is well-known for its support of the armed forces,” Burgess told FoxNews.com. “That’s why this is so disheartening to all of us.”

Deverell did not inform school officials of the incident, Burgess said, adding that McPherson would have quickly determined the shirt to be a non-issue if consulted.

“Nobody took the next step of asking the principal or making them aware of it,” Burgess said. “The teacher is obviously allowed to question anything they feel might be a violation of dress code, but again, had an administrator been allowed to respond, this could have been taken care of yesterday.”

Students within the district are expected to wear clothing in a “neat, clean and well-fitting manner,” according to a copy of the policy, which was obtained by FoxNews.com. While addressing “violent behavior,” gang symbols and other inappropriate images, it does not explicitly ban images of guns and other weapons.

“Student dress (including accessories) may not advertise, promote, or picture alcoholic beverages, illegal drugs, drug paraphernalia, violent behavior, or other inappropriate images,” it reads. “Student dress (including accessories) may not display lewd, vulgar or obscene or offensive language or symbols, including gang symbols.”

Hats, bandannas and sunglasses are also banned inside the building. Students who violate the dress code will be asked to wear their gym uniform, it reads.

District officials, meanwhile, said its students are dutiful patriots who support U.S. troops as much as they can.

“The students and staff regularly write letters of support to the troops, and hold patriotic ceremonies for Veterans Day and Patriots' Day,” a statement obtained by FoxNews.com reads. “We very much support the armed forces and were disheartened to learn of this matter through the media. The administration and school handbook agree that this shirt is not a violation of the dress code. We also take school safety very earnestly and it needs to be recognized that is a topic that we also take very seriously and support our students and staff in providing a safe environment to learn, teach and work in on a daily basis.”

McIntyre said he believes the incident is likely an overreaction to recent mass shootings, particularly to the Dec. 14, 2012, massacre at Sandy Hook Elementary School in which 20 students and six staffers were killed after Adam Lanza killed his mother at their Connecticut home.

“I backed him up and he knows that,” McIntyre said of his son. “This is not right. This policy that they have in place can obviously be loosely interpreted, so they need to change it.”
FoxNews

‘Obama to tell Netanyahu US gearing up for Iran strike’

When he visits Israel next month, US President Barack Obama will tell Prime Minister Benjamin Netanyahu that a “window of opportunity” for a military strike on Iran will open in June, according to an Israeli TV report Monday evening.

Obama will come bearing the message that if diplomatic efforts and sanctions don’t bear fruit, Israel should “sit tight” and let Washington take the stage, even if that means remaining on the sidelines during a US military operation, Channel 10 reported. Netanyahu will be asked to refrain from any military action and keep a low profile, avoiding even the mention of a strike, the report said, citing unnamed officials.

In London Monday, Secretary of State John Kerry said an Iran with nuclear weapons was “simply unacceptable” and warned the time limit for a diplomatic solution was running out.

“As we have repeatedly made clear, the window for a diplomatic solution simply cannot remain open forever,” said Kerry, on his first international tour as America’s top diplomat. “But it is open today. It is open now and there is still time, but there is only time if Iran makes the decision to come to the table and to negotiate in good faith.

“We are prepared to negotiate in good faith, in mutual respect, in an effort to avoid whatever terrible consequences could follow failure, and so the choice really is in the hands of the Iranians. And we hope they will make the right choice,” Kerry added.

A fresh round of high-level diplomatic talks were set to begin Tuesday in Kazakhstan — the first since last June’s meeting in Moscow failed to convince Iran to stop enriching uranium to a level close to that used for nuclear warheads.

Two weeks ago, Netanyahu said he was looking forward to Obama’s visit and insisted that he enjoyed a positive relationship with the American president, despite reports to the contrary.

“We worked together closely, closer than how it may look. We worked together on security, diplomacy and intelligence,” he said, warning that Iran’s nuclear weapons program “continues unabated” and that “they’ll soon have enough material to produce a nuclear bomb.”

Netanyahu said earlier this month that he and Obama had agreed on three key areas of consultation during the presidential visit — thwarting Iran’s nuclear drive, grappling with the instability in Syria and the risks of WMD there falling into rogue hands, and the Israeli-Palestinian conflict.
Times of Israel This week should make it clear to anyone as to when O is lying, whenever he opens his mouth

Video: DHS-Funded Drone Spies On Private Gun Sale

The promotional video for a surveillance drone now being purchased by law enforcement bodies across the country with the aid of DHS funding shows a UAV spying on a private gun sale, falsely depicting the scenario as a criminal activity.

It is important to emphasize that private firearms sales without background checks are not illegal under current law in the United States, although gun control advocates are feverishly trying to change that with new legislation. The government claims that 40 per cent of all gun sales are conducted without background checks.

The clip is part of promo material for the Shadowhawk drone, a 50lb mini helicopter that can be fitted with an XREP taser with the ability to fire four barbed electrodes that can be shot to a distance of 100 feet, delivering “neuromuscular incapacitation” to the victim. The drone can travel at a top speed of 70MPH and can operate for 3.5 hours over land and sea. The drone, which is manufactured by Vanguard Defense Industries, can also be armed with 12-gauge shotguns and grenade launchers.

The company’s website notes that drones fitted with weapons are currently, “Not available to law enforcement,” although drone industry lobbyists are pushing for that to be changed.

The footage shows two men driving to meet clandestinely in a remote area, before they exit their vehicles and proceed to conduct a transaction for a handgun and a semi-automatic rifle, before driving off at high speed.

During the commentary over the clip, which features dramatic music, role players run the license plates of both vehicles before describing the transaction as the spy drone hovers above.

Throughout the clip, the private sale of firearms is demonized by clearly being associated with illegal and clandestine activity, despite the fact that it is completely lawful to sell firearms privately with no paperwork or background checks, including at gun shows.

After being used against Somali pirates and insurgents in Afghanistan, the Department of Homeland Security approved the drone for use on domestic soil in 2011, prompting the Sheriff’s Office of Montgomery County, Texas to purchase one for a cool $500,000 dollars, aided by a $250,000 DHS grant.

The fact that Homeland Security is approving and funding drones that are being sold on the basis that they can spy on gun owners is somewhat disturbing given that the federal agency has committed to purchasing around 2 billion rounds of ammunition over the course of the last year alone, which many see as a sign of preparations for civil unrest. The DHS also bought 7,000 fully automatic assault rifles last year, labeling them “personal defense weapons”.

As we reported last week, a DHS contractor had to apologize after producing shooting targets that depicted American gun owners, pregnant women and children as “non-traditional threats,” prompting outage.

Watch a news report about the Montgomery County Sheriff’s Office purchase of the Shadowhawk drone below.
Infowars

Why Should Taxpayers Give Big Banks $83 Billion a Year?

On television, in interviews and in meetings with investors, executives of the biggest U.S. banks --notably JPMorgan Chase & Co. Chief Executive Jamie Dimon -- make the case that size is a competitive advantage. It helps them lower costs and vie for customers on an international scale. Limiting it, they warn, would impair profitability and weaken the country’s position in global finance.

So what if we told you that, by our calculations, the largest U.S. banks aren’t really profitable at all? What if the billions of dollars they allegedly earn for their shareholders were almost entirely a gift from U.S. taxpayers?


Granted, it’s a hard concept to swallow. It’s also crucial to understanding why the big banks present such a threat to the global economy.

Let’s start with a bit of background. Banks have a powerful incentive to get big and unwieldy. The larger they are, the more disastrous their failure would be and the more certain they can be of a government bailout in an emergency. The result is an implicit subsidy: The banks that are potentially the most dangerous can borrow at lower rates, because creditors perceive them as too big to fail.

Lately, economists have tried to pin down exactly how much the subsidy lowers big banks’ borrowing costs. In one relatively thorough effort, two researchers -- Kenichi Ueda of theInternational Monetary Fund and Beatrice Weder di Mauro of the University of Mainz -- put the number at about 0.8 percentage point. The discount applies to all their liabilities, including bonds and customer deposits.

Big Difference

Small as it might sound, 0.8 percentage point makes a big difference. Multiplied by the total liabilities of the 10 largest U.S. banks by assets, it amounts to a taxpayer subsidy of $83 billion a year. To put the figure in perspective, it’s tantamount to the government giving the banks about 3 cents of every tax dollar collected.

The top five banks -- JPMorgan, Bank of America Corp., Citigroup Inc., Wells Fargo & Co. and Goldman Sachs Group Inc. - - account for $64 billion of the total subsidy, an amount roughly equal to their typical annual profits (see tables for data on individual banks). In other words, the banks occupying the commanding heights of the U.S. financial industry -- with almost $9 trillion in assets, more than half the size of theU.S. economy -- would just about break even in the absence of corporate welfare. In large part, the profits they report are essentially transfers from taxpayers to their shareholders.

Neither bank executives nor shareholders have much incentive to change the situation. On the contrary, the financial industry spends hundreds of millions of dollars every election cycle on campaign donations and lobbying, much of which is aimed at maintaining the subsidy. The result is a bloated financial sector and recurring credit gluts. Left unchecked, the superbanks could ultimately require bailouts that exceed the government’s resources. Picture a meltdown in which the Treasury is helpless to step in as it did in 2008 and 2009.

Regulators can change the game by paring down the subsidy. One option is to make banks fund their activities with more equity from shareholders, a measure that would make them less likely to need bailouts (we recommend $1 of equity for each $5 of assets, far more than the 1-to-33 ratio that new global rules require). Another idea is to shock creditors out of complacency by making some of them take losses when banks run into trouble. A third is to prevent banks from using the subsidy to finance speculative trading, the aim of the Volcker rule in the U.S. and financial ring-fencing in the U.K.

Once shareholders fully recognized how poorly the biggest banks perform without government support, they would be motivated to demand better. This could entail anything from cutting pay packages to breaking down financial juggernauts into more manageable units. The market discipline might not please executives, but it would certainly be an improvement over paying banks to put us in danger.
Bloomberg

O wills it!

NRA Uses Justice Memo to Accuse Obama on Guns

The National Rifle Association is using a Justice Department memo it obtained to argue in ads that the Obama administration believes its gun control plans won't work unless the government seizes firearms and requires national gun registration — ideas the White House has not proposed and does not support.

The NRA's assertion and its obtaining of the memo in the first place underscore the no-holds-barred battle under way as Washington's fight over gun restrictions heats up.

The memo, under the name of one of the Justice Department's leading crime researchers, critiques the effectiveness of gun control proposals, including some of President Barack Obama's. A Justice Department official called the memo an unfinished review of gun violence research and said it does not represent administration policy.

The memo says requiring background checks for more gun purchases could help, but also could lead to more illicit weapons sales. It says banning assault weapons and high capacity ammunition magazines produced in the future but exempting those already owned by the public, as Obama has proposed, would have limited impact because people now own so many of those items.

It also says that even total elimination of assault weapons would have little overall effect on gun killings because assault weapons account for a limited proportion of those crimes.

The nine-page document says the success of universal background checks would depend in part on "requiring gun registration," and says gun buybacks would not be effective "unless massive and coupled with a ban."

The administration has not proposed gun registration, buybacks or banning all firearms. But gun registration and ownership curbs are hot-button issues for the NRA and other gun-rights groups, which strenuously oppose the ideas.

Whether to require record-keeping for private gun sales is holding up a congressional compromise on legislation to expand background checks, now required only for transactions by federally licensed dealers, according to people familiar with bipartisan Senate talks who spoke on condition of anonymity because the talks are private.

Justice Department and White House officials declined to provide much information about the memo or answer questions about it on the record.

The memo has the look of a preliminary document and calls itself "a cursory summary" and assessment of gun curb initiatives. The administration has not release it officially.

But the NRA has posted the memo on one of its websites and cites it in advertising aimed at whipping up opposition to Obama's efforts to contain gun violence. The ad says the paper shows that the administration "believes that a gun ban will not work without mandatory gun confiscation" and thinks universal background checks "won't work without requiring national gun registration" — ideas the president has not proposed or expressed support for.

"Still think President Obama's proposals sound reasonable?" Chris W. Cox, the NRA's chief Washington lobbyist, says in the ad.

Last month, White House spokesman Jay Carney said none of Obama's proposals "would take away a gun from a single law-abiding American." Other administration officials have said their plans would not result in gun seizures or a national gun registry.

A Justice Department official who would only discuss the issue on condition of anonymity said the NRA ad misrepresents Obama's gun proposals and that the administration has never backed a gun registry or gun confiscation.

While the memo's analysis of gun curb proposals presents no new findings, it is unusual for a federal agency document to surface that raises questions about a president's plans during debate on a high-profile issue such as restricting firearms.

Obama wants to ban assault weapons and ammunition magazines exceeding 10 rounds that are produced in the future. He wants universal background checks for nearly all gun purchases. Today, checks are only mandatory on sales by federally licensed gun dealers, not transactions at gun shows or other private sales.

His plan also includes tougher federal laws against gun trafficking and straw purchases, which occur when a person legally buys a firearm but sells it to a criminal or someone else barred from owning a weapon.

Interest in the gun issue has intensified since the December shootings in Newtown, Conn., that killed 20 first-graders and six staffers at an elementary school. The Democratic-led Senate Judiciary Committee plans to write legislation addressing some of Obama's proposals in the next week or two.

The NRA's Cox declined to say how his organization obtained the memo.

He said the commercial is running online in 15 states, including many Republican-leaning states where Democrats will defend Senate seats next year, such as Alaska, Arkansas, Louisiana, Montana, North Carolina, South Dakota and West Virginia. There are also ads in papers in five states.

The memo was written under the name of Greg Ridgeway, acting director of the National Institute of Justice, the Justice Department's research arm. It is dated Jan. 4, nearly two weeks before Obama announced his plan for restricting guns, and Ridgeway's first day as acting chief.

Justice Department officials said Ridgeway was not granting interviews. He came to the institute last July from the RAND Corporation, a nonprofit research institution where he studied criminal justice issues, and has a Ph.D. in statistics.

The memo says straw purchases and gun thefts are the largest sources of firearms used in crimes, and that such transactions "would most likely become larger if background checks at gun shows and private sellers were addressed."

Gun control supporters said the NRA ad and the Justice memo don't mention that the current federal background check system blocked gun sales to 2.1 million criminals and others barred from owning guns between 1994, when the checks began, and 2010. Also ignored is that Obama has proposed cracking down on straw purchases to prevent a growth in illegal transactions, they said.

Advocates of restricting guns also said the memo omitted mention of several studies that affirm the effectiveness of firearms curbs. These include a 2010 police group analysis showing more than one-third of police departments found increased criminal use of assault weapons and high-capacity magazines since the 2004 expiration of the ban on those items.

"It doesn't appear to be a serious discussion of gun violence prevention policy, never mind an expression of administration policy," said Joshua Horwitz, executive director of the Coalition to Stop Gun Violence.

The memo says that out of 11,000 annual gun homicides, an average of 35 deaths yearly are from mass shootings, defined as those with four or more victims.

"Policies that address the larger firearm homicide issue will have a far greater impact even if they do not address the particular issues of mass shootings," it says.

It says there were an estimated 1.5 million assault weapons before the 10-year ban on those firearms began in 1994, so their sheer number would weaken a new ban exempting existing weapons. Such guns accounted for just 2 percent to 8 percent of crimes before the 1994 ban, so eliminating assault weapons "would not have a large impact on gun homicides," the memo said.

Recent data on the assault weapons ban impact is scarce because since the 1990s, Congress has blocked most federal research on the effect that firearms have on public health. As part of the gun restrictions Obama proposed last month, he ordered federal scientific agencies to research gun violence.
Yahoo

‘Israel’s strike on Syria last month killed top Iranian general’

Hassan Shateri, the Iranian general whose killing was reported last week, was actually slain last month in an alleged IAF airstrike that was said to have targeted a weapons convoy heading from Syria to the Lebanese group Hezbollah, Britain’s Sunday Times reported.

Iran was quick last week to blame “mercenaries and supporters” of Israel for Shateri’s death, although it made no indication that he had been killed in the January airstrike. Tehran “will take revenge on Israel for the killing of a Quds Force general in Syria,” said Ali Shirazi, liaison for Supreme Leader Ayatollah Ali Khamenei to the Revolutionary Guards’ elite Quds Force.

Shateri was a high-ranking member of the Quds Force, which is tasked with international operations, and was instrumental in Iran-Hezbollah relations, overseeing the reconstruction of Hezbollah’s armaments in the wake of the 2006 Second Lebanon War, Sunday’s report said.

For Israel, he was long a “prime target,” according to an Israeli security figure quoted by The Times.

The report described how, despite the tight security surrounding Shateri, Israeli agents spotted him in Damascus and trailed him as he boarded the convoy headed for Lebanon, after which the airstrike option was utilized.

According to Israeli and Western defense officials quoted by the foreign press at the time, the convoy was delivering Russian-made SA-17 anti-aircraft missiles that, in Hezbollah’s hands, would be considered game-changing in that they would disrupt Israel’s ability to carry out reconnaissance flights over Lebanon.

But according to Sunday’s report, even the specter of advanced surface-to-air weaponry in the hands of Israel’s sworn enemy would not be sufficient, without further cause, to merit a risky strike deep in Syrian territory.

A senior Israeli source was quoted as saying that Shateri was the real target of the strike and that “a weapons convoy to Lebanon is not on its own a good enough reason for Israel to risk its pilots in an attack through a heavily protected air defense zone.”

Bracing for Iranian relation, Israel has been operating on high security alert, especially internationally, since the January strike, the report said.

Iran condemned the alleged Israeli airstrike at the time, with a top official saying that Israel would regret its “latest aggression” on Syria and calling on the entire Muslim world to defend the Syrian people.

“Just as it regretted its aggressions after the 33-day, 22-day and eight-day wars, today the Zionist entity will regret the aggression it launched against Syria,” said Saeed Jalil, the secretary of Iran’s Supreme National Security Council, evoking past wars between Israel and Hezbollah and the Palestinian Hamas group.

Israel has not officially acknowledged having carried out an airstrike in Syria, although Defense Minister Ehud Barak alluded to Israeli involvement, saying, “What happened in Syria… that’s proof that when we say something we mean it.”
Times of Israel

The Bill of Rights for dummies, with emphasis on the 3rd Amendment

Report: Obama's Secret North Korea Talks Failed; Hagel Approach Ineffective

The Obama administration conducted two secret diplomatic missions to North Korea in 2012, according to reports in the South Korean press that were confirmed by the Los Angeles Times. The talks failed to dissuade the regime of Kim Jong Un to abandon that country’s aggressive nuclear weapons program. President Barack Obama suggested such talks in 2007, as did Secretary of Defense nominee Chuck Hagel that same year.

On Feb. 12, in what looks increasingly like a direct and personal rebuke to Obama, the North Korean regime conducted an underground nuclear test on the same day that the president was to give his State of the Union address. In two previous State of the Union addresses, President Obama had touted progress in isolating North Korea (2010), and had called on the regime to keep “its commitment to abandon nuclear weapons” (2011).

In a 2007 speech to the libertarian Cato Institute, Hagel had said that North Korea was “moving in the right direction” because of increased willingness by the U.S. to engage in diplomacy. He offered a similar diplomatic prescription for making progress in dealing with the Iranian regime, the dictatorship of Bashar Assad in Syria, and the Palestinian terrorist group Hamas, suggesting talks would produce better result than confrontation.

However, the Assad regime is now killing thousands of civilians in a civil war, the Hamas organization rejects talks with Israel over anything except Israel’s destruction, and Iran refused the Obama administration’s offer of direct talks earlier this month. The failure of President Obama’s diplomatic overtures to North Korea--which may date back to 2011, according to reports the Times could not confirm--are only the most dramatic example.

The secret talks with North Korea occurred in April and August 2012, according to the Times, and congress has not yet been notified about the new talks or their substance. The last prior official attempt at diplomacy with North Korea was in 2009, in the early months of the Obama administration, when the U.S. attempted to restart the six-party talks from which North Korea had withdrawn over UN condemnation of its satellite tests.

For all its flawed optimism about the prospects for democracy in the Arab Middle East--which is now swiftly unraveling everywhere it has begun--the guiding philosophy of the Bush administration’s approach to rogue regimes was correct in one key respect: that societies that are not free are incapable of making peace, because continued war and confrontation are essential to the regimes in maintaining their continued grip on power.

As Natan Sharansky wrote in The Case for Democracy--widely considered a critical book in guiding George W. Bush’s thinking--rogue regimes may sign peace deals if such agreements are in their short-term best interests, but “a genuine and lasting peace can only be made with democracies.” Until then, he advises, an national security policy that presents rogue states with tough, negative political or military consequences is best.

Former UN Ambassador John Bolton--like Hagel, the subject of an intense confirmation fight in 2005--recently published an op-ed in the Wall Street Journal suggesting that the U.S. respond to North Korea’s nuclear test by pressuring China to support reunification of the Korean peninsula--a peaceful form of regime change. “A reunification strategy should have been pressed decades ago, but better late than never,” Bolton wrote.
Breitbart

Bloomberg's ban prohibits 2-liter soda with your pizza and some nightclub mixers

Take a big gulp, New York: Hizzoner is about to give you a pop.

Nanny Bloomberg unleashes his ban on large sodas on March 12 — and there are some nasty surprises lurking for hardworking families.

Say goodbye to that 2-liter bottle of Coke with your pizza delivery, pitchers of soft drinks at your kid’s birthday party and some bottle-service mixers at your favorite nightclub.

They’d violate Mayor Bloomberg’s new rules, which prohibit eateries from serving or selling sugary drinks in containers larger than 16 ounces.

Bloomberg’s soda smackdown follows his attacks on salt, sugar, trans fat, smoking and even baby formula.


NANNY MIKE'S CAN'T-DO ATTITUDE

The city Health Department last week began sending brochures to businesses that would be affected by the latest ban, including restaurants, bars and any “food service” establishment subject to letter grades.

And merchants were shocked to see the broad sweep of the new rules.

“It’s not fair. If you’re gonna tell me what to do, it’s no good,” said Steve DiMaggio of Caruso’s in Cobble Hill, Brooklyn. “It’s gonna cost a lot more.”

And consumers, especially families, will soon see how the rules will affect their wallets — forcing them to pay higher unit prices for smaller bottles.

Typically, a pizzeria charges $3 for a 2-liter bottle of Coke. But under the ban, customers would have to buy six 12-ounce cans at a total cost of $7.50 to get an equivalent amount of soda.

“I really feel bad for the customers,” said Lupe Balbuena of World Pie in Carroll Gardens, Brooklyn.

Domino’s on First Avenue and 74th Street on the Upper East Side is doing away with its most popular drink sizes: the 20-ounce and 2-liter bottles.

“We’re getting in 16-ounce bottles — and that’s all we’re going to sell,” a worker said.

He said the smaller bottles will generate more revenue for the restaurant but cost consumers more.

It will also trash more plastic into the environment.

Deliveryman Philippe Daniba said he had brought countless 2-liter bottles of soda to customers over his 19 years at the restaurant. The ban, he said, “doesn’t make sense.”

Industry-group officials agreed.

“It’s ludicrous,” said Robert Bookman, a lawyer for the New York City Hospitality Alliance. “It’s a sealed bottle of soda you can buy in the supermarket. Why can’t they deliver what you can get in the supermarket?”

Families will get pinched at kid-friendly party places, which will have to chuck their plastic pitchers because most hold 60 ounces — even though such containers are clearly intended for more than one person.

Changes will be made at the Frames bowling alley in Times Square, where 26-ounce pitchers are served at kids’ parties, said manager Ayman Kamel.

“We’re going to try to get creative,” he said, noting drinks with 100 percent juice are exempt from the ban.

“We’re figuring out a way to have freshly squeezed juice for the birthday parties. We might have to raise the price about a dollar or so.”

Dallas BBQ at 1265 Third Ave. will retire its 60-ounce pitchers and 20-ounce glasses, manager Daisy Reyes said.

“We have to buy new glasses,” she said. “We’re in the process.”

And if you’re looking for a night of bottle service at a Manhattan hot spot, be warned: Spending $300 on a bottle of vodka no longer entitles you to a full complement of mixers.


The carafes in which mixers are typically served hold 32 ounces, and the most common mixers — sodas, cranberry juice and tonic water — will be limited. Only water and 100 percent juice will be unlimited.

“Oh, my God. Seriously?” said Lamia Sunti, owner of the swanky West Village club Le Souk Harem. “It’s not like one person is going to be drinking the whole carafe. It’s silly.”

The rules are hard to unravel.

Alcoholic drinks and diet sodas are not subject to the ban, nor are fruit smoothies if they don’t have added sweetener, or coffee drinks and milkshakes if made with 50 percent milk.

But what about drinks with small amounts of added sugar? Vendors must determine if the beverages have more than 3.125 calories per ounce.

But they should double-check their math: Violations cost $200 each.
NYPost

FBI probe of defense tech allegedly leaked from NASA stonewalled, sources say

A four-year FBI investigation into the transfer of classified weapons technology to China and other countries from NASA’s Ames Research Center is being stonewalled by government officials, sources tell FoxNews.com.

Documents obtained by FoxNews.com, which summarize these and other allegations and were given to congressional sources last week by a whistle-blower, described how a “secret grand jury” was to be convened in February 2011 to hear testimony from informants in the case, including a senior NASA engineer. But federal prosecutor Gary Fry was removed from the case, which was then transferred from one office in the Northern District of California to another where, according to the documents, “this case now appears to be stalled.”

“The information is staggering,” the whistle-blower told FoxNews.com.

A Justice Department spokesman on Thursday told FoxNews.com it “does not comment on grand jury proceedings,” as a matter of longstanding policy. Fry, reached for comment late Thursday, also would not confirm or deny the claim


The claims originate with several past and current NASA employees concerned with the systemic leak of highly sensitive information relating to missile defense systems, as well as what they call a troubled investigation into the leak.

The documents claim the FBI has been working with other agencies since 2009 on an investigation into foreign nationals working at Ames. This follows allegations by two Republican lawmakers earlier this month that the U.S. attorney’s office in the Northern California district was ultimately denied by the Justice Department when it tried to proceed with indictments.

Melinda Haag, the U.S. attorney for the Northern District of California, denied claims her office was blocked in trying to proceed with the case.

“I am aware of allegations our office sought authority from DOJ in Washington, D.C. to bring charges in a particular matter and that our request was denied,” she said in a written statement. “Those allegations are untrue. No such request was made and no such denial was received.”

Yet two members of Congress, Reps. Frank Wolf, R-Va., and Lamar Smith, R-Texas, said in a statement to FoxNews.com that Haag’s denial “conflicts with information we have received from federal law enforcement sources,” and added “we hope that the DOJ Inspector General will take our request seriously.” The lawmakers had requested, via letter, an IG investigation.

Rob Storch, a spokesman for the DOJ inspector general’s office, confirmed to FoxNews.com the office received the letter from Wolf and Smith. “We’re evaluating (the letter),” he said.

Located in the heart of Silicon Valley, the Ames Research Center has been a center of high tech innovation for more than 60 years. As the space agency’s mission has changed over the years since it was built, NASA has turned it into a commercial research facility, leasing out space to a number of companies including rocket firm SpaceX and tech giant Google, which leases 42 acres there through a holding company called Planetary Ventures.

The accusations stem from a reported violation of the International Traffic in Arms Regulation (ITAR), which governs the export of defense weaponry. In 2006, Ames adapted specialized rocket engines -- originally developed for the Pentagon missile defense “Kinetic Kill Vehicle” program -- for a moon lander prototype that ultimately became NASA’s Lunar Atmosphere and Dust Environment Explorer (LADEE). The robotic moon orbiter is set to launch on Aug. 12, 2013.

Information on guidance and terrain-mapping systems from the Tomahawk cruise missile and a radar from the F-35 were also shared, according to one report in Aviation Week.

"When I mentioned the tech that was compromised to the Armed Services Committee, their jaws just dropped," a congressional source told FoxNews.com.

The sources allege that Ames Center Director Simon P. “Pete” Worden and Will Marshall, a British citizen, shared that moon lander project - and the missile defense technology – with individuals from foreign countries including China, South Korea and Saudi Arabia.

“Will Marshall in particular had demonstrated far too great an interest in locating U.S. spy satellites, giving interviews to Chinese and American newspapers on curtailing U.S. space security,” reads a document that was purportedly given to the FBI. Marshall could not be reached for comment by FoxNews.com.

The document claims foreign nationals, under the direction of Worden, were since 2006 brought in to work on space flight projects, without the proper export control licenses. Further, the document claims they were planning to share technology with the Chinese and other countries through the International Space University.

The document also charges the Department of Homeland Security “intercepted” Marshall at the San Francisco airport, and “confiscated” his NASA-issued computer, suggesting it contained sensitive information.

“Foreign nationals had access to technology and even brought foreign visitors in to see it. Three left the country and talked about the technology,” congressional sources told FoxNews.com. “The case was referred to the U.S. attorney – it’s a clear violation of ITAR.”

A NASA engineer was subpoenaed to testify before a secret grand jury in February 2011 in San Jose, according to the documents. But the attorney assigned to the case – Gary Fry -- was removed at the last minute, before the case was transferred to another office within Haag’s district. Fry still works out of the San Jose office.

NASA headquarters deferred questions to the Department of Justice. The Justice Department headquarters also declined to comment to FoxNews.com.

But Worden told FoxNews.com the accusations are “rubbish.”

“I take very seriously our responsibility to safeguard sensitive information. I say this unambiguously — I have not, would not, and could not impede a law enforcement investigation. To the best of my knowledge I am not the subject of a current investigation,” he said in a statement.

On Feb. 8, Reps. Wolf and Smith sent letters to the Justice Department inspector general and the director of the FBI regarding the allegedly illegal movement of this crucial technology. Wolf chairs the House Appropriations Commerce, Justice, Science and Related Agencies subcommittee. Smith heads the House Science, Space and Technology Committee.

The letters allege the FBI had uncovered the ITAR violations, and the U.S. attorney was prepared to issue indictments. But it says the case has been stalled for more than a year, agents in the case were reassigned, and the statute of limitations on the violations is already beginning to expire.

“It is our understanding that this illegal technology transfer may have involved classified Defense Department weapons system technology to foreign countries, including China, potentially with the tacit or direct approval of the center’s leadership,” the letters read.

Sen. Charles Grassley, R-Iowa, also wrote to NASA as early as April 2012 asking about allegations that Worden “allowed foreign nationals” to access Ames – along with “NASA secrets and cutting edge technology” in violation of ITAR.
FoxNews


Like gunwalking but with missies

U.S. sends troops to Niger for drone missions

WASHINGTON — About 100 U.S. troops have deployed to the West African country of Niger to help establish a drone base for surveillance missions, in the latest step by the United States to aid French forces battling Islamic militants in neighboring Mali.

In a letter to Congress on Friday, President Obama said the deployment would "provide support for intelligence collection and will also facilitate intelligence sharing with French forces conducting operations in Mali, and with other partners in the region."

The last 40 American troops in the deployment arrived in Niger on Feb. 20 with the consent of the government, Obama said.

A senior U.S. officer described the troops as a security unit that will protect crews flying and maintaining U.S. Air Force drones now operating from an airfield near the capital, Niamey. The force includes drone pilots, intelligence liaison officers and aircraft maintenance personnel, the officer said.

"We're basing drones there to help the French, and this deployment is the security element," the officer said.

He spoke on the condition of anonymity because he was not authorized to discuss details of the operation publicly.

French forces have been battling to push Islamic militants out of northern Mali in recent weeks in an effort to oust insurgents who seized local control after the civilian government collapsed last year.

Predator drones are already flying over Mali to assist French troops, who intervened in January and have driven back militants and Tuareg rebels, who had taken over three major cities and were threatening Mali's capital, Bamako.

The drones flying from Niger will be unarmed surveillance aircraft tracking suspected militants operating in the remote parts of northern Mali. The aircraft could also be used over other countries in the region, the officer said.

The Obama administration has not yet decided to establish a permanent drone base in Niger, the senior officer said. For the moment, the operation is considered a temporary mission to assist the French.

But some senior officers in the Pentagon's Africa Command, which oversees military operations on the continent, favor a permanent base to develop a better picture of the militant threat in West Africa, the officer said.

Among the groups the U.S. is worried about is Boko Haram, an Islamist extremist group in neighboring Nigeria.

Currently, the only permanent base in Africa from which drones operate is in Djibouti, thousands of miles to the east.

In addition to the militants in Mali — some with loose ties to Al Qaeda groups — extremists have taken refuge in the largely ungoverned desert areas of southern Libya and Algeria.

If the Obama administration decides to authorize a permanent base in Niger, it would probably be in Agadez, near northern Mali, the officer said, confirming a report in the New York Times.

Some senior military commanders, in arguing for a permanent base, say the militant threat in the region is growing and could eventually threaten the U.S. and its allies unless more aggressive action is taken.

But some Obama administration officials are skeptical about getting more deeply involved in the region, saying there is no strong evidence that militants there want to target the United States.

Some officials also argue against getting involved in a low-level military operation just as direct U.S. involvement in the war in Afghanistan is nearing an end.

The Obama administration has helped the French operation in Mali with intelligence, transportation for French troops and air refueling of French fighters. But the White House has kept the U.S. role limited.

The U.S. buildup in Niger, though still small in numbers, has unfolded quickly. Last month, the U.S. and Niger signed an agreement outlining legal protections for American troops operating there.

The U.S. also has been operating surveillance drones across the region, including over a natural gas complex last month in eastern Algeria, where militants took hundreds of people prisoner during a four-day siege that killed 37 hostages.
LATimes

Bombs away

SHOCK REPORT — Veterans Receive Letters From VA Prohibiting Ownership or Purchase of Firearms

This must be Barack Obama’s way of thanking our veterans for serving. US veterans are receiving letters from the government informing them that they are disabled and not allowed to own, purchase or possess a firearm. If the veteran does decide to purchase a firearm he will by fined, imprisoned or both.
This comes on page 2 of the VA letter.
Gateway Pundit

13,753 Gov’t Requests for Google E-Mail Data in 2012, Most Without a Warrant

(CNSNews.com) - American government agencies – state, local, and federal -- made a record 13,753 requests to read emails or gather other information sent through Google’s Gmail and other services in 2012, more than half without warrants, according to statistics released by Google.

The total number of users about whom government agencies wanted information also set a record at 31,072, up from 23,300 in 2011, the first year Google began reporting the data. The discrepancy comes because government agencies request information on multiple users or accounts at the same time.

Most of these 13,753 requests, 6,542 of 8,438 in the latter half of 2012 alone, were done without a search warrant, Google data show. Google did not make available any detailed data prior to June 2012, nor did it make available which requests came from the federal government and which came from state or local law enforcement agencies, when asked by CNSNews.com.

Google spokesman Chris Gaither said the company only started tracking which type of legal authority – subpoena, court order, or search warrant – was used in the latter half of 2012. Google issues biannual reports on the requests for user data it receives from government agencies from around the world, including ones in the U.S.

Google announced in June 2012 that it had 425 million active Gmail subscribers, making it the largest e-mail provider in the world. It also provides users the ability to store documents via its Google Drive service, phone service via Google Voice, YouTube, personal blogs via Blogger, as well as email hosting services for corporate clients through Gmail.

Google keep records of all email and other communication sent through its e-mail, telephone, YouTube, and other services, storing the information on cloud servers – a move that allows government agencies, local, state, and federal, to access some information without a warrant.

Federal law allows government agencies to access Google’s archived email and other data, including chat logs, YouTube user information, voice messages, and blogger information without obtaining a search warrant or establishing probable cause, and Google says that it complies with the vast majority of government requests for data.

From July-December 2012 Google provided user information in 88 percent of cases. From January to June 2012, it provided information in 90 percent of cases. Those figures were down from 2011 when it provided user information in 93 percent of cases.

The government can access data, including the content of emails sent or received through Gmail, because Google keeps records of all communications sent over its various services and stores the information on cloud servers, lowering the legal threshold government agencies need to access some of the data, including the name, Internet address, and telephone number of Gmail, YouTube, and other Google users.

The federal law that allows this is known as the Electronic Communications Privacy Act (ECPA) which says that opened email stored remotely – not on a computer’s hard drive – can be accessed without a warrant.

If the government wants to read the content of an email accessed through Gmail, hear a voicemail message sent over Google’s telephone service Google Voice, or read other private content, it must still obtain a search warrant under federal law.

However, information not sent in the body of an email or recorded in a voice message can be obtained by a simple subpoena – which does not require a government agency to show probable cause. Such information includes the name of an e-mail account holder, the IP address used when signing into and out of Gmail including dates and times, and other information you gave to Google when you created Gmail or other Google account.

Other types of information require a court order from a judge, such as the IP address of a particular email, email addresses of those you correspond with, and the web sites a person has visited.

A search warrant is required to read the content of an email stored on Google’s servers, as well access as internet search histories, YouTube videos, photos, and other documents.

Because all types of requests usually come through some kind of criminal investigation, Google does not notify users when the government demands to read their emails or access their account information. However, Google says that in cases where it is legally allowed to inform users, it tries to do so.

“We notify users about legal demands when appropriate, unless prohibited by law or court order,” Google says on its transparency website.

“We can't notify you if, for example, your account has been closed, or if we're legally prohibited from doing so. We sometimes fight to give users notice of a data request by seeking to lift gag orders or unseal search warrants.”

Google says it requires government agencies make a formal, written claim under ECPA before it will release any user data.

“The government needs legal process—such as a subpoena, court order or search warrant—to force Google to disclose user information. Exceptions can be made in certain emergency cases, though even then the government can't force Google to disclose.”
CNSNews

Firearms Companies Restricting Sales To GOVERNMENT Agencies In Areas That Restrict Gun Rights

A growing number of firearm and firearm-related companies have stated they will no longer sell items to states, counties, cities and municipalities that restrict their citizens' rights to own them.

According to The Police Loophole, 34 companies have joined in publicly stating that governments who seek to restrict 2^nd Amendment rights will themselves be restricted from purchasing the items they seek to limit or ban.

Extreme Firepower Inc., located in Inwood, WV has had a longstanding policy that states:

"The Federal Government and several states have enacted gun control laws that restrict the public from owning and possessing certain types of firearms...If a product that we manufacture is not legal for a private citizen to own in a jurisdiction, we will not sell that product to a law-enforcement agency in that jurisdiction."

York Arms, located in Buxton, ME released a statement following new legislation in New York:

"Based on the recent legislation in New York, we are prohibited from selling rifles and receivers to residents of New York. We have chosen to extend that prohibition to all governmental agencies associated with or located within New York."

Quality Arms, located in Rigby, ID writes on their website, "elected officials have their own agenda to circumnavigate the truth and destroy the constitution of the United States."

The site states: "Quality Arms Idaho will not supply and firearm or product, manufactured by us, or any other company nor will we warranty, repair, alter, or modify and firearm owned by any State, County or Municipality who infringes on the right of its citizens to bear arms under the 2^nd Amendment."

Bravo Company USA states:

"The people at Bravo Company USA and BCM support responsible private individuals having access to the same tools of civilian Law Enforcement to affect the same ends...As such Bravo Company's policy is that law enforcement officials and departments will be restricted to the same type of products available to responsible private individuals of that same city or state."

To view the full list click here.
CNSNews


We need to support these responsible companies and boycott all the rest that aren't.

Revealed: al-Qaeda's 22 tips for dodging drones

Read the list in full here

The document includes advice such as "hide under thick trees" (believed to be bin Laden's contribution), and instructions for setting up a "fake gathering" using dolls to "mislead the enemy".

Found by the Associated Press in a building in Timbuktu, the ancient city occupied by Islamists last year, the document is believed to have been abandoned as extremists fled a French military intervention last month. It is a Xeroxed copy of a tipsheet authored by a Yemeni extremist that has been published on some jihadi forums, but that has made little appearance in English.

The list reflects how al-Qaeda in the Islamic Maghbreb anticipated a military intervention that would make use of drones, as the war on terror shifts from the ground to the air.

The document also shows the coordination between al-Qaeda chapters, which security experts have called a source of increasing concern.

"This new document... shows we are no longer dealing with an isolated local problem, but with an enemy which is reaching across continents to share advice," said Bruce Riedel, a 30-year veteran of the CIA, now the director of the Intelligence Project at the Brookings Institute.
While some of the tips are outdated or far-fetched, taken together, they suggest the Islamists in Mali are responding to the threat of drones with sound, common-sense advice that may help them to melt into the desert in between attacks, leaving barely a trace.
"These are not dumb techniques. It shows that they are acting pretty astutely," said Col Cedric Leighton, a 26-year-veteran of the United States Air Force, who helped set up the Predator drone program, which later tracked Osama bin Laden in Afghanistan.
"What it does is, it buys them a little bit more time - and in this conflict, time is key. And they will use it to move away from an area, from a bombing raid, and do it very quickly," he said.
The success of some of the tips will depend on the circumstances and the model of drones used, Col Leighton said. For example, from the air, where perceptions of depth become obfuscated, an imagery sensor would interpret a mat stretched over the top of a car as one lying on the ground, concealing the vehicle.
New models of drones, such as the Harfung used by the French or the MQ-9 "Reaper," sometimes have infrared sensors that can pick up the heat signature of a car whose engine has just been shut off. However, even an infrared sensor would have trouble detecting a car left under a mat tent overnight, so that its temperature is the same as on the surrounding ground, Col Leighton said.
Unarmed drones are already being used by the French in Mali to collect intelligence on al-Qaeda groups, and US officials have said plans are underway to establish a new drone base in northwestern Africa.
The US recently signed a "status of forces agreement" with Niger, one of the nations bordering Mali, suggesting the drone base may be situated there and would be primarily used to gather intelligence to help the French.
The author of the tipsheet found in Timbuktu is Abdallah bin Muhammad, the nom de guerre for a senior commander of al-Qaeda in the Arabian Peninsula, the Yemen-based branch of the terror network.
The document was first published in Arabic on an extremist website on June 2, 2011, a month after bin Laden's death, according to Mathieu Guidere, a professor at the University of Toulouse.
Prof Guidere runs a database of statements by extremist groups, including al-Qaeda in the Islamic Maghreb, and he reviewed and authenticated the document found by the AP.
The tipsheet is still little known, if at all, in English, though it has been republished at least three times in Arabic on other jihadist forums after drone strikes took out US-born cleric Anwar al-Awlaki in Yemen in September 2011 and al-Qaeda second-in-command Abu Yahya al-Libi in Pakistan in June 2012.
It was most recently issued two weeks ago on another extremist website after plans for the possible US drone base in Niger began surfacing, Prof Guidere said.
"This document supports the fact that they knew there are secret US bases for drones, and were preparing themselves," he said. "They were thinking about this issue for a long time."
The idea of hiding under trees to avoid drones, which is tip No 10, appears to be coming from the highest levels of the terror network. In a letter written by bin Laden and first published by the US Center for Combating Terrorism, the terror mastermind instructs his followers to deliver a message to Abdelmalek Droukdel, the head of al-Qaeda in the Islamic Maghreb, whose fighters have been active in Mali for at least a decade.
"I want the brothers in the Islamic Maghreb to know that planting trees helps the mujahedeen and gives them cover," bin Laden writes in the missive. "Trees will give the mujahedeen the freedom to move around especially if the enemy sends spying aircrafts to the area."
Hiding under trees is exactly what the al-Qaeda fighters did in Mali, according to residents in Diabaly, the last town they took before the French stemmed their advance last month. Just after French warplanes incinerated rebel cars that had been left outside, the fighters began to commandeer houses with large mango trees and park their four-by-fours in the shade of their rubbery leaves.
Hamidou Sissouma, a schoolteacher, said the Islamists chose his house because of its generous trees, and rammed their trucks through his earthen wall to drive right into his courtyard. Another resident showed the gash the occupiers had made in his mango tree by parking their pickup too close to the trunk.
In Timbuktu also, fighters hid their cars under trees, and disembarked from them in a hurry when they were being chased, in accordance with tip No 13.
Moustapha al-Housseini, an appliance repairman, was outside his shop fixing a client's broken radio on the day the aerial bombardments began. He said he heard the sound of the planes and saw the Islamists at almost the same moment. Abou Zeid, the senior al-Qaeda emir in the region, rushed to jam his car under a pair of tamarind trees outside the store.
"He and his men got out of the car and dove under the awning," said Mr al-Housseini. "As for what I did? Me and my employees? We also ran. As fast as we could."
Along with the grass mats, the al-Qaeda men in Mali made creative use of another natural resource to hide their cars: Mud.
Asse Ag Imahalit, a gardener at a building in Timbuktu, said he was at first puzzled to see that the fighters sleeping inside the compound sent for large bags of sugar every day. Then, he said, he observed them mixing the sugar with dirt, adding water and using the sticky mixture to "paint" their cars. Residents said the cars of the al-Qaeda fighters are permanently covered in mud.
The drone tipsheet, discovered in the regional tax department occupied by Abou Zeid, shows how familiar al-Qaeda has become with drone attacks, which have allowed the US to take out senior leaders in the terrorist group without a messy ground battle. The preface and epilogue of the tipsheet make it clear that al-Qaeda well realizes the advantages of drones: They are relatively cheap in terms of money and lives, alleviating "the pressure of American public opinion."
Ironically, the first drone attack on an al-Qaeda figure in 2002 took out the head of the branch in Yemen - the same branch that authoured the document found in Mali, according to Riedel. Drones began to be used in Iraq in 2006 and in Pakistan in 2007, but it wasn't until 2009 that they became a hallmark of the war on terror, he said.
"Since we do not want to put boots on the ground in places like Mali, they are certain to be the way of the future," he said. "They are already the future."
Telegraph

US ready to strike back against China cyberattacks

WASHINGTON (AP) -- As public evidence mounts that the Chinese military is responsible for stealing massive amounts of U.S. government data and corporate trade secrets, the Obama administration is eyeing fines and other trade actions it may take against Beijing or any other country guilty of cyberespionage.

According to officials familiar with the plans, the White House will lay out a new report Wednesday that suggests initial, more-aggressive steps the U.S. would take in response to what top authorities say has been an unrelenting campaign of cyberstealing linked to the Chinese government. The officials spoke on condition of anonymity because they were not authorized to speak publicly about the threatened action.

The White House plans come after a Virginia-based cybersecurity firm released a torrent of details Monday that tied a secret Chinese military unit in Shanghai to years of cyberattacks against U.S. companies. After analyzing breaches that compromised more than 140 companies, Mandiant has concluded that they can be linked to the People's Liberation Army's Unit 61398.

Military experts believe the unit is part of the People's Liberation Army's cyber-command, which is under the direct authority of the General Staff Department, China's version of the Joint Chiefs of Staff. As such, its activities would be likely to be authorized at the highest levels of China's military.

The release of Mandiant's report, complete with details on three of the alleged hackers and photographs of one of the military unit's buildings in Shanghai, makes public what U.S. authorities have said less publicly for years. But it also increases the pressure on the U.S. to take more forceful action against the Chinese for what experts say has been years of systematic espionage.

"If the Chinese government flew planes into our airspace, our planes would escort them away. If it happened two, three or four times, the president would be on the phone and there would be threats of retaliation," said former FBI executive assistant director Shawn Henry. "This is happening thousands of times a day. There needs to be some definition of where the red line is and what the repercussions would be."

Henry, now president of the security firm CrowdStrike, said that rather than tell companies to increase their cybersecurity the government needs to focus more on how to deter the hackers and the nations that are backing them.

James Lewis, a cybersecurity expert at the Center for Strategic and International Studies, said that in the past year the White House has been taking a serious look at responding to China, adding that "this will be the year they will put more pressure on, even while realizing it will be hard for the Chinese to change. There's not an on-off switch."

The Chinese government, meanwhile, has denied involvement in the cyber-attacks tracked by Mandiant. Instead, the Foreign Ministry said that China, too, is a victim of hacking, some of it traced to the U.S. Foreign Ministry spokesman Hong Lei cited a report by an agency under the Ministry of Information Technology and Industry that said in 2012 alone that foreign hackers used viruses and other malicious software to seize control of 1,400 computers in China and 38,000 websites.

"Among the above attacks, those from the U.S. numbered the most," Hong said at a daily media briefing, lodging the most specific allegations the Chinese government has made about foreign hacking.

Cybersecurity experts say U.S. authorities do not conduct similar attacks or steal data from Chinese companies, but acknowledge that intelligence agencies routinely spy on other countries.

China is clearly a target of interest, said Lewis, noting that the U.S. would be interested in Beijing's military policies, such as any plans for action against Taiwan or Japan.

In its report, Mandiant said it traced the hacking back to a neighborhood in the outskirts of Shanghai that includes a white 12-story office building run by the PLA's Unit 61398.

Mandiant said there are only two viable conclusions about the involvement of the Chinese military in the cyberattacks: Either Unit 61398 is responsible for the persistent attacks or they are being done by a secret organization of Chinese speakers with direct access to the Shanghai telecommunications infrastructure who are engaged in a multi-year espionage campaign being run right outside the military unit's gates.

"In a state that rigorously monitors Internet use, it is highly unlikely that the Chinese government is unaware of an attack group that operates from the Pudong New Area of Shanghai," the Mandiant report said, concluding that the only way the group could function is with the "full knowledge and cooperation" of the Beijing government.

The unit "has systematically stolen hundreds of terabytes of data from at least 141 organizations," Mandiant wrote. A terabyte is 1,000 gigabytes. The most popular version of the new iPhone 5, for example, has 16 gigabytes of space, while the more expensive iPads have as much as 64 gigabytes of space. The U.S. Library of Congress' 2006-2010 Twitter archive of about 170 billion tweets totals 133.2 terabytes.

"At some point we do have to call the Chinese out on this," said Michael Chertoff, Homeland Security secretary under President George W. Bush and now chairman of the Chertoff Group, a global security firm. "Simply rolling over and averting our eyes, I don't think is a long-term strategy."

Richard Bejtlich, the chief security officer at Mandiant, said the company decided to make its report public in part to help send a message to both the Chinese and U.S. governments.

"At the government level, I see this as a tool that they can use to have discussions with the Chinese, with allies, with others who are concerned about this problem and have an open dialogue without having to worry about sensitivities around disclosing classified information," Bejtlich said. "This problem is overclassified."

He said the release of an unclassified report that provides detailed evidence will allow authorities to have an open discussion about what to do.

Mandiant's report is filled with high-tech details and juicy nuggets that led to its conclusion, including the code names of some of the hackers, like Ugly Gorilla, Dota and SuperHard, and that Dota appears to be a fan of Harry Potter because references to the book and movie character appear as answers to his computer security questions.

The White House would not comment on the report expected Wednesday.

"We have repeatedly raised our concerns at the highest levels about cybertheft with senior Chinese officials, including in the military, and we will continue to do so," said Caitlin Hayden, spokeswoman for the National Security Council. "The United States and China are among the world's largest cyber actors, and it is vital that we continue a sustained, meaningful dialogue and work together to develop an understanding of acceptable behavior in cyberspace."

Sen. Dianne Feinstein, D-Calif., chairman of the Senate Intelligence Committee, said the report reinforces the need for international agreements that prohibit cybercrimes and have a workable enforcement mechanism.
AP

O is going to give them a good scolding