Grim days for capitalism as winds of change sweep Wall Street
NEW YORK: Almost exactly a year ago, Tom Wolfe, author of "The Bonfire of the Vanities," was wandering the floor of the New York Stock Exchange. Dressed in his trademark white suit, he darted around traders and whisked past trading booths, shaking hands and waving, just before the market was about to open.
It was a sunny, ebullient morning. The Dow Jones industrial average stood at 13,337. Deals were zipping across the ticker: Barneys, the luxury retailer, was sold that morning to an investment arm of the Dubai government. Investment bankers were getting ready to work a half-day Friday, then drive out to the Hamptons.
But the real excitement - the reason, traders whispered, that Wolfe must be in attendance - was that Blackstone Group, the big private equity firm, was minutes away from going public, the largest initial public offering in the United States since 2002. (At the time, Wolfe told The New York Observer that a friend was giving him a tour.)
Just then, a CNBC reporter pulled Wolfe aside to ask him what he made of all the hubbub. Wolfe paused for a moment to contemplate his answer.
And then, with a wry smile, he delivered a prophetic declaration: "We may be witnessing the end of capitalism as we know it."
Here we are a year later, and while it may not be the end of capitalism, it looks as if Wolfe got it a lot closer than, say, the investors who plowed money into Blackstone.
Capitalism today - at least as Wall Street defines it - is a very different, and worse, business. And it is only going to get tougher from here.
Sherman McCoy, Wolfe's bond-trading protagonist - who always bemoans he is "hemorrhaging money!" - would probably be selling his 12-room apartment on Park Avenue right about now.
Or, as Wolfe told me during an interview Monday, "he would be eating his heart out wanting to run a hedge fund, but he's not smart enough!"
Wolfe said he was mesmerized by what had happened to Wall Street in the past year. "Nobody understands where the actual value is - and they don't care anymore," he exclaimed.
Of course, Wolfe's 1980s Wall Street - of privileged WASPs (and Jewish Anglophiles), the sons of Harvard and Stanford and Princeton braying for money on the bond market - is pretty much gone now. It was replaced, in part, by the world of private equity and hedge funds, by bankers who think proprietary trading is more important than servicing clients.
And now that world is crumbling, too.
Blackstone's stock has gone nowhere but down since it went public, dropping nearly 50 percent from its high the day it started trading. But that is the least of it.
The once mighty Wall Street investment banks have been brought to their knees, sending out pink slips to more than 83,000 employees worldwide, racking up billions of dollars in losses as a result of their foolish forays into subprime mortgages. Bear Stearns all but went out of business before being "saved." Some hedge funds have gone belly-up.
Those lords of private equity, many of which were preparing to follow Blackstone into the public markets, have been put on semipermanent hiatus. (Kohlberg Kravis Roberts refuses to withdraw its initial public offering filing, almost a year after submitting it, with no immediate hope in sight.) Their deal-making has all but stopped.
As Wolfe nicely put it, "It sounds like even the firms that aren't in trouble are in trouble."
And yet, there has been a perverse, and misguided, optimism that somehow the situation will improve in the second half of 2008.
How? Sure, the big banks may take fewer write-downs - but there is no way of knowing that. The news a few days ago that the big bond insurers were being downgraded will create new havoc - and losses - for holders of toxic subprime debt.
Indeed, the bigger issue is what kind of business is going to generate any return for its investors. When you can't lend or trade - and you can't invest with the leverage that juiced returns to support seven- and eight-figure bonuses - how exactly are you going to make money?
"It has always interested me that the word 'credit' comes from the word 'credere,' which means 'to believe,"' Wolfe said. "It only works if people believe in it." He's right, of course: one reason the credit markets have tumbled is that people don't believe anymore.
Foreign investors seemed to have too much faith last autumn, pouring money into firms like Citigroup. But their stocks just kept falling, so much so that no sovereign wealth fund came to the rescue of Lehman Brothers in its hour of need this month.
In truth, Wall Street is in for a radical makeover.
Fewer people, lower margins, lower risk, lower compensation - and ultimately, fewer talented people. It is likely to change the culture of an industry that for nearly a century has been the money center of the world.
"There would be a lot of firms leaving New York if it wasn't for lunch," Wolfe said with a laugh, noting that bankers still like being fawned over by captains and waiters who speak in "movie French."
Wall Street will have to downsize. Citigroup is cutting 10 percent of its work force this week, and even the wonder boys over at Goldman Sachs are cutting 10 percent. And that may not be enough.
In 1973, Wall Street shrank by 15 percent amid a severe economic downturn. The bloodletting continued into the next year, when 12 percent of the work force was booted out the door.
That pinstriped massacre was caused by a stalling economy, amid skyrocketing oil prices, rising inflation and a faltering bond market - very similar to the problems that the economy is facing today.
Stir in a bit of globalization, and the world becomes more challenging.
"I think that what's going to come back to bite us is globalization," Wolfe said. "It's never been tested. It's like a Ponzi scheme in which we are the Ponzi, and everyone else makes money except us."
Still, Wolfe remains cautiously optimistic. "This country is so rich," he said. "I don't see people cutting down much in New York City."
When I asked Wolfe about his comment on the floor of the stock exchange, he said, "I didn't realize anyone would take me seriously." He says he has since made up an explanation of why he thought it could be the end of capitalism.
Citing Joseph Schumpeter, the economist, Wolfe said, "Stocks and bonds are what he called evaporated property. People completely lose touch of the underlying assets. It's all paper - these esoteric devices. So it has become evaporated property squared. I call it evaporated property cubed."
Then he cautioned, "Of course, I'm not an economist."
Maybe that's why he's gotten it so right.
http://www.iht.com/articles/2008/06/24/business/sorkin.php
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After the rains, Australian farmers dare to hope
NARRABRI, Australia: Powerful lights eerily illuminate pitch-black paddocks as farmers sow newly rain-blessed soil with one of Australia's biggest wheat crops.
Rigs as big as houses sow seeds in one of the most fertile parts of Australia's eastern grain belts. Farmers are praying they will beat a seven-year drought to fill silos with grain in a year of high prices.
"It's a nervous optimism," said one farmer Phil Christie near Narrabri, about 500 kilometers, or 300 miles, northwest of Sydney.
Eastern Australia has been hit hardest by the country's worst drought in 100 years, but good rain has fallen recently to allow long-delayed planting to begin. Now farmers are working round the clock to plant, with satellites steering tractors night and day.
"We really need this crop. We've had no crop for two or three years. If this one fails it will take a lot of people down," Christie said. "Everyone's borrowed to the hilt to put this crop in."
Nearby, Australia's biggest wheat farmer, Ron Greentree, is sowing 80,000 hectares, or almost 200,000 acres, with wheat. Greentree hopes to produce more than 200,000 tons of wheat, or 1 percent of Australia's total.
He smiles buoyantly beneath his battered bush hat as he stands in newly seeded fields, the crumbling moist, black earth marching in straight planting lines to the distant horizon.
"It looks pretty good," he said. But there is still a long way to go until the crops are ready for harvest toward the end of the year, and September spring rains will be crucial.
"There's been a few false starts in the last few years," he said.
Last year, farmers lost millions of dollars when they planted large areas with wheat after good rains only to then lose their crops and their investments when drought set in again.
The government, however, is optimistic. Even after a 9 percent cut in its forecast of Australia's 2008-'09 wheat crop on June 17, the government is still forecasting a big crop of 23.68 million tons, up by more than 80 percent on last year's drought-affected crop.
An Australian crop of this size, together with forecast big European crops, will be enough to pull world wheat prices back from recent highs, brokers believe.
"A better rainfall situation in Australia might start to see the markets work their way lower," Garry Booth of MF Global said.
Driven by shortages and strong demand, world wheat prices have been on a roller coaster for a year. They soared by more than 150 percent between mid-2007 and March 2008 after crop failures in Australia and elsewhere, then fell by more than 40 percent by the end of May this year as crop prospects improved, then gained more than 20 percent after crop-damaging floods in the United States and dry weather during the Australia planting season.
Even in a calmer market, agriculture is now a hot industry for growers such as Greentree, as corn and rice prices have also soared.
"It has all turned around probably in this last six months," Greentree said. "People are starting to realize that it is a very important industry, not only for the economy of Australia but also for society around the world."
Agriculture in Australia had been seen by governments and academics in the past 10 or 15 years as a sunset industry, he said. Now wheat is as important as steel.
Wheat prices may have doubled in the past year, but so have oil prices and other farm costs. Prices of energy-intensive fertilizer alone have risen to 1,500 Australian dollars, or $1,497, a ton from 600 and it costs about 2,000 dollars worth of fuel to run a tractor for 12 hours hauling a seeding rig.
Farmers say it now costs 500 dollars a hectare to plant and grow wheat, up from the old benchmark of 250 dollars.
Banks have so far supported the struggling farmers through two years of failed crops and losses, but there could be foreclosures after a couple of good seasons, Christie fears. Banks could not foreclose up until now because nobody had money to buy the failed farms.
Greentree, who spent 100 million dollars this year to nearly double the size of his landholdings to 100,000 hectares, is also hit hard by fuel prices.
"It's blown our budget to smithereens," he said.
Greentree is waiting for technology to provide the answer to high costs and changing weather systems.
George Sevil, Narrabri's mayor, believes that the recent rains will rescue many farms from bankruptcy.
"Whoever timed it did a good job," he said. "This will get everyone back on their feet."
http://www.iht.com/articles/2008/06/24/business/farm.php
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Investors in China seek out fast food
HONG KONG: With the stock market debut this month of the hot-pot restaurant chain Little Sheep, brokers are promoting a new theme for investors hungry for a slice of China's consumer boom: home-grown fast food.
Chinese appetite for on-the-go burgers, fried chicken, pizza and noodles is expected to make fast food a $66 billion industry in China by 2009, up from $51.7 billion last year, according to the research firm Euromonitor.
The Chinese chains Little Sheep, Café de Coral and Fairwood, as well as Ajisen of Japan and the international behemoths KFC, Pizza Hut, McDonald's and Burger King, are all catering to growing demand for fast food.
But food prices in China, the world's fastest-growing major economy, are soaring, and experts say a lack of pricing power is squeezing firms in a crowded market, where scale is the key to long term success and profitability.
Food costs account for around a quarter of fast-food chains' expenses, analysts say. Adding pressure is an extremely fragmented market where the five largest Chinese companies account for just 3 percent of the market.
http://www.iht.com/articles/2008/06/24/business/food.php
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Argentine farmers end road blockade
ROSARIO, Argentina: Country roads and highways swelled with trucks bearing grains and gasoline during the weekend as Argentina's farmers cleared the highways after lifting their fourth strike in three months.
While hope sprang eternal here in Santa Fe Province that food rationing and gasoline shortages would finally ease, the latest chapter in the political drama began playing out in Buenos Aires, where the embattled president, Cristina Fernández de Kirchner, met with farm leaders late Monday.
Congress was expected to begin a thorny debate this week on an export tax, which touched off the farmers' revolt more than three months ago. In a long-awaited concession, Kirchner, her popularity plummeting in opinion polls, agreed last week to let Congress approve or reject the system of sliding taxes that she imposed on farmers in March.
Yet even if Congress can resolve the export tax dispute, the conflict has already struck a deep blow to Argentina's economy, to its international reputation as a major food supplier and to the psyche of its 40 million people.
"In just 100 days this has become like another country," said Cristian Zaráte, a farmer in Armstrong, a town about an hour from Rosario, Santa Fe's capital. "Whatever happens now, the damage has already been done."
http://www.iht.com/articles/2008/06/24/america/argentina.php
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OPINION
KOREAN BEEF IMPORTS
Stop the madness
Michael Hansen is a senior scientist at Consumers Union.
The Korean beef market, once the third-largest importer of American beef, has shut its doors to the United States. Why? Because Koreans are worried about eating meat tainted with mad cow disease, which can be fatal to humans.
Although the two countries reached an agreement last week restricting U.S. beef exports to younger cattle, protesters have vowed to keep rallying against President Lee Myung Bak's efforts to reopen the market. A public survey published Tuesday suggested that most South Koreans still oppose the new import plan.
American beef producers could easily allay their fears by subjecting every cow at slaughter to the so-called rapid test, which costs about $20 per carcass and screens for this brain-wasting disease in a few hours rather than days. But the U.S. Department of Agriculture won't allow that.
In 2004, Creekstone Farms in Arkansas City, Kansas, wanted to test the cattle it slaughters to comply with the wishes of its Korean and Japanese customers. But the department ruled that the rapid test could only be used as part of its own mad cow surveillance program, which randomly checks about 1 in 1,000 dead and slaughtered cattle in the United States every year. The sale of the kits to private companies is prohibited under an obscure 1913 law that allows the department to prohibit veterinary products that it considers "worthless."
Creekstone sued the government in 2006, arguing in court that the Agriculture Department could not deem worthless a test that it used in its own surveillance program. The court agreed, but the department appealed. A decision is expected soon.
It is hard to understand why the Agriculture Department wants to stand in the way. Yes, the test has limitations: It can miss a case of mad cow disease, also called bovine spongiform encephalopathy, in the very early stages of incubation. But it can catch the disease in later stages, before animals show symptoms. Between 2001 and 2006, the European Union used the test to turn up 1,117 cases of mad cow disease in seemingly healthy cattle approved for slaughter.
Ideally, the Agriculture Department would follow the rules set up in Europe and Japan that require every cow over a certain age to be tested before being slaughtered. At the very least the department should not prevent private companies from testing.
Companies that use the rapid test should also be allowed to label their meat as having been "tested for mad cow" for American consumers who would like this extra level of protection. A Consumers Union national survey done in January 2004 found that 71 percent of adults who eat beef would pay more to support testing, and of those, 95 percent were willing to spend 10 cents more per pound for tested meat.
In the Creekstone case, the Agriculture Department argued that the tests should be prohibited because if one company started using them, consumer demand would drive all companies to use them, and that would add to the price of beef. But would that be such a bad thing? Isn't this how the laws of supply and demand are supposed to work?
Most Americans, like Koreans, understand that testing for mad cow could save lives - and they'd like to have that option.
http://www.iht.com/articles/2008/06/24/opinion/edhansen.php
Carbon Trust launches carbon emission certification
LONDON: Carbon Trust launched a scheme to recognise carbon emission reductions on Tuesday, saying consumers and businesses both benefit from clear information on steps taken to tackle climate change.
The government-funded body has initially awarded the badge to twelve organisations, including a number of government departments as well as Thames Water, hardware firm B&Q and supermarket chain Wm Morrisons .
Applicants were tested on whether they accurately measured past and current emissions and reduced them over three years.
They will also need to prove "they have got the management infrastructure embedded within the organisation to show they will continue on that trajectory," spokesman Henry Garthwaite said.
He said the Trust expects to sign up hundreds of organisations in the next 12 to 18 months
http://www.iht.com/articles/reuters/2008/06/23/business/OUKBS-UK-CARBON-TRUST.php
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Senegal urged to clean toxic Dakar area after deaths
GENEVA: The World Health Organisation urged Senegal on Tuesday to decontaminate an area of Dakar where nearly 1,000 residents remain exposed to high concentrations of brain-damaging lead after 18 children died.
International health and environmental experts carried out an investigation last week in the NGagne Diaw quarter of Thiaroye sur Mer, an area used for recycling lead batteries.
"Many children are showing evidence of neurological damage. Environmental investigations have found very high concentrations of lead both outside and inside people's homes," the WHO said in a statement.
Some 950 people in the poor area are "continuously exposed through ingestion and inhalation of lead-contaminated dust," it said. "Thorough decontamination of the affected area of NGagne Diaw, including the insides of homes, is a high priority."
At least 31 children require treatment for lead poisoning, but only a proportion of the population has been examined, said Joanna Tempowski, a scientist in the WHO's environmental health emergencies division.
http://www.iht.com/articles/reuters/2008/06/24/africa/OUKWD-UK-SENEGAL-HEALTH.php
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Tired Milan plans a green, young future
MILAN: Optimists might call it Milan's Eiffel Tower moment.
The Universal Expo, which gave Paris its landmark in 1889, is due in Milan in 2015, bringing investment to pep up a sluggish economy as it turns Silvio Berlusconi's buttoned-down hometown into one of Europe's largest building sites.
For many Milanese, it's long overdue: Italy's fashion and business capital is aging and has long suffered from an image as a gritty city of smog, traffic and grey asphalt pavements.
Hosting the five-yearly Expo is a high-stakes game that can make or damage a city's reputation, and coffers.
Besides Paris, whose skyline earned a global profile with the straddle-footed monument erected for its Exposition Universelle, Seville got an economic boost with Expo in 1992 and Lisbon transformed a derelict industrial site for the 1998 Expo.
REJUVENATION
"This is an important turning-point that we've been waiting to carry out, including through investment in Expo 2015," said Carlo Masseroli, Milan's urban development chief, adding that Milan is ripe for rejuvenation.
Only one in four Milanese were aged 30 and under in 2006, down from almost a third in 1991, a fall due to a lower birth rate and higher rents that pushed younger couples beyond city limits.
Ranking in the bottom third of European cities for green space per resident, Milan also plans to add 11 million square meters of parks and other green spaces.
Not all the building is directly related to the Expo, due to draw around 30 million visitors. Javier Monclus, an architecture professor at Polytechnic University in Barcelona, said Milan's plans are in line with those of other host cities in stressing infrastructure and more green space.
"Everybody thinks of expos ... as a tool for urban transformation, so the strategy is one more instrument for changing the city," said Monclus, who has studied the impact of expositions on cities.
The architectural changes will be Milan's most dramatic since the 1950s, when architect Gio Ponti's sleek Pirelli building took its place as the city's sole skyscraper. At 216 meters (713 feet), it remains Italy's tallest building.
Planned construction includes CityLife -- three striking towers on the site of a former fairground: a twisting column, a skyscraper with drooping upper floors, and a tower taller than the Pirelli building.
Some critics, including Berlusconi, have said the CityLife project by architects Daniel Libeskind, Zaha Hadid and Arata Isozaki is not in keeping with Milan's discreet style of hiding wealth behind heavy doors and barred windows.
But many Milanese see the plan as a needed boost to Italy's industrial heartland and a way to enliven a featureless cityscape.
A 2007 survey of business executives by real estate consultancy Cushman and Wakefield put Milan in 12th place among 33 European cities as a place to locate a business, in part because it is near the centre of the continent.
http://www.iht.com/articles/reuters/2008/06/24/europe/OUKWD-UK-ITALY-EXPO.php
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OPINION
Some doubts upon entering a new carboniferous era
Verlyn Klinkenborg is a member of the New York Times editorial board.
Has any phrase in the English language ever spread more quickly than "carbon footprint"? There are contenders - "hanging chad," for instance - but they don't reflect the potential revolution in consciousness that carbon footprint suggests. After all, carbon footprint captures something we've never really had a simple phrase for before: the measurable totality of your environmental impact, or, to put it more simply, what your way of life actually costs the planet. "Carbon footprint" is to your physical being what "soul" is to your spiritual being.
In some ways carbon footprint is not an especially good metaphor.
The carbon in question - the carbon dioxide that contributes to global warming - is a gas and far too diffuse to resemble an actual footprint. Still, the phrase sounds conscientious. You feel as though you're reducing global warming by saying it.
Which is why advertisers are saying it everywhere. For example, the New York Metropolitan Transportation Authority now has an advertising campaign, called Ecolution, which congratulates subway riders for doing their part to reduce their carbon footprint by riding the subway. That campaign is a good idea; it helps remind us of the consequences of our actions. And yet it implies, oddly, that you were suddenly faced this morning with the choice between taking the No. 1 train from 86th Street, as usual, or driving in from the suburbs where you do not live in a car you do not own.
Companies of every description have taken up the phrase. Wal-Mart announced last fall that it would ask its suppliers to assess and lower their carbon footprints, one way that Wal-Mart is trying to green itself. BP, the much-fined petroleum giant, has a carbon footprint calculator on its Web site, as well as a link to its conservative thinking on climate change. Consumers who wish to buy voluntary carbon offsets to compensate for the size of their personal carbon footprints are beginning to be able to do so close to home. Why not buy local carbon offsets at the farmers' market along with your locally grown produce?
http://www.iht.com/articles/2008/06/24/opinion/edverlyn.php
Life on the fringes of U.S. suburbia becomes untenable with rising gas costs
ELIZABETH, Colorado: Suddenly, the economics of American suburban life are under assault as skyrocketing energy prices inflate the costs of reaching, heating and cooling homes on the outer edges of metropolitan areas.
Just off Singing Hills Road, in one of hundreds of two-story homes dotting a former cattle ranch beyond the southern fringes of Denver, Phil Boyle and his family openly wonder if they will have to move close to town to get some relief.
They still revel in the space and quiet that has drawn a steady exodus from U.S. cities toward places like this for more than half a century. Their living room ceiling soars two stories high. A swing-set sways in the breeze in their backyard. Their wrap-around porch looks out over the flat scrub of the high plains to the snow-capped peaks of the Rocky Mountains.
But life on the distant fringes of suburbia is beginning to feel untenable. Boyle and his wife must drive nearly an hour to their jobs in the high-tech corridor of southern Denver. With gasoline at more than $4 a gallon, Boyle recently paid $121 to fill his pickup truck with diesel. The price of propane to heat their spacious house has more than doubled in recent years.
Though Boyle finds city life unappealing, it's now up for reconsideration.
http://www.iht.com/articles/2008/06/24/business/exurbs.php
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Oil near $138 as Iran denies rumoured attack
LONDON: Oil rose for a third straight session on Tuesday to more than $138 a barrel, boosted by a rumoured attack on Iran's nuclear facilities, which was denied.
"This is just a rumour. No attack against Iran's nuclear facilities has taken place," a senior Iranian nuclear official said.
U.S. crude for August delivery was up $1.17 at $137.91 a barrel by 1?34 p.m., after settling up $1.38 on Monday. It hit a record high of $139.89 on June 16.
London Brent crude was up $1.23 at $137.14 a barrel.
Tension over Iran's nuclear programme has played a big part in oil's rise to record levels near $140 a barrel.
http://www.iht.com/articles/reuters/2008/06/24/business/OUKBS-UK-MARKETS-OIL-1.php
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GM offers deals to cut overstock
DETROIT: The General Motors Corporation said on Monday that it would offer six-year, no-interest loans on slow-selling models for the rest of June as it closes out a dismal second quarter.
In addition, GM said that it would further reduce production of pickup trucks and sport utility vehicles because inventories of those vehicles remain high.
It was the second time this month that GM has revealed plans to build fewer pickups and SUV's, and it came only a few days after its rival, the Ford Motor Company, made a similar announcement. Both automakers are simultaneously increasing production of their most fuel-efficient cars and crossover vehicles, which are running low at some dealers.
The no-interest loan sale, which begins Tuesday and ends June 30, is GM's latest effort to jump-start sales at dealers whose showrooms have been emptier this month than at any time in recent memory. Among the models excluded from the sale are the Chevrolet Aveo, Cobalt and Malibu, three smaller cars that have been selling well as consumers react to $4-a-gallon gasoline by trading in big gas-guzzlers.
"Hopefully it will spark some traffic and some momentum," GM's vice president for North American sales and marketing, Mark LaNeve, said.
http://www.iht.com/articles/2008/06/24/business/24auto.php
Cher Ian Walthew,
Notre dossier d'été de "L'Express" sur l'Auvergne, où figurera en bonne place la fourme des Hautes Chaumes, est en bonne voie.
Tous les dossiers de cette série commencent par un texte écrit par un écrivain étranger donnant sa vision de la région de France où il vit. Seriez-vous d'accord pour écrire un court texte sur l'Auvergne, les raisons qui font que vous avez choisi d'y vivre, les Auvergnats, leurs qualités et leurs défauts,( et la fourme, la maternité d'Ambert, votre question à Brice Hortefeux, etc)? Ce texte d'une longueur de 5000 signes peut être rédigé en anglais, et sera traduit par nos soins.
Je serais heureux et honoré que vous acceptiez.
Dites-moi...
Jean-Paul Guilloteau ( le photographe) et moi-même gardons un merveilleux souvenir de notre montée à l'estive.
Très cordialement.
François Dufay rédacteur en chef du service "Livres"
"L'Express"
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Israeli guard kills himself at Sarkozy farewell
TEL AVIV: An Israeli guard on the perimeter of a farewell airport ceremony for French President Nicolas Sarkozy shot himself dead on Tuesday, causing a security stir but not endangering the visiting leader, police said.
"This was in no way an assassination attempt," police spokesman Micky Rosenfeld said. "A border policeman ... committed suicide during the farewell ceremony."
Bodyguards hustled Sarkozy and his wife, Carla Bruni-Sarkozy, into their plane at Tel Aviv's Ben-Gurion Airport after the shot was heard. Other security men whisked Israeli Prime Minister Ehud Olmert toward his car.
Olmert and Israeli President Shimon Peres, who was also at the scene, returned to the aircraft to bid the Sarkozys a final goodbye after it was established that the incident was over and posed no threat. The plane then departed.
According to Rosenfeld, the guard who shot himself was a paramilitary policeman and had been assigned to a security patrol at the airport.
Israel Radio said the guard was stationed 100 metres to 200 metres (yards) away from Sarkozy's plane. Two women soldiers who witnessed the shooting were treated for shock, the radio said.
http://www.iht.com/articles/reuters/2008/06/24/europe/OUKWD-UK-FRANCE-ISRAEL-SHOT.php
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Israeli policeman kills self at Sarkozy ceremony
BEN-GURION AIRPORT, Israel: An Israeli police officer fatally shot himself in the head at an airport farewell ceremony Tuesday for French President Nicolas Sarkozy, prompting bodyguards to whisk the visiting leader and Israeli Prime Minister Ehud Olmert to safety, officials said.
A military band was playing at the time of the shooting, and the dignitaries apparently didn't hear anything. Dark-suited security men quickly ushered Sarkozy and his wife, Carla Bruni-Sarkozy, up the stairs of his plane at Ben-Gurion Airport outside Tel Aviv.
Security guards, their guns drawn, also rushed Olmert and Israeli President Shimon Peres toward their cars. The incident was over within minutes, and Olmert then boarded the plane to tell Sarkozy what happened, witnesses said.
The policeman, who was on a roof about 100 yards from Sarkozy's plane, fell to the ground after shooting himself, and his sheet-covered body lay on the tarmac afterward.
Police spokesman Micky Rosenfeld denied reports that there had been an assassination attempt on Sarkozy, and other police officials said the leaders were never in danger.
"We are currently investigating the circumstances to see whether it was suicide or if he accidentally discharged his weapon," said area police commander Nissim Mor. "His mission was to secure an area to prevent people from reaching the ceremony."
A French presidential spokesman who was on another scheduled flight out of Tel Aviv said he knew nothing about the incident.
Sarkozy was ending a three-day visit. Earlier Tuesday, in the West Bank town of Bethlehem, Sarkozy said Israel's separation barrier in the West Bank would not guarantee its security forever, renewing his call for Israelis and Palestinians to make peace and share the holy city of Jerusalem.
Sarkozy spoke at a news conference alongside Palestinian President Mahmoud Abbas, following his only meeting with Palestinian leaders during his visit, which was aimed primarily at cementing the improved relations between France and Israel after years of frosty ties.
Nevertheless, the French president was unusually frank in his comments critical of Israeli policies.
On Monday, he told the Israeli parliament that there could be no Mideast peace unless Israel halted its West Bank settlement construction and divided Jerusalem. On Tuesday, he focused on the separation barrier that Israel says it has built to keep suicide bombers out. Palestinians denounce the barrier as a land grab.
"You can't protect yourself with a wall, but with politics," Sarkozy said. "What will give Israel security ... is making a democratic Palestinian state."
Israeli government spokesman David Baker said Sarkozy was "a great friend of Israel," adding that "great friends don't always see eye to eye on every issue."
Sarkozy also repeated his call to share Jerusalem, the eastern part of which Palestinians claim as the capital of their future state.
Sarkozy, whose maternal grandfather was a Greek Jew, devoted most of his trip to meetings with Israeli leaders. He also met the parents of an Israeli soldier held by Palestinian militants in Gaza. The young man, Gilad Schalit, also holds French citizenship.
Throughout the visit, he called himself a "friend of Israel" and showered praise on the Jewish state.
"On behalf of France, we would like to declare our true love to Israel — we love you!" Sarkozy said at a meeting with businessmen.
http://www.iht.com/articles/ap/2008/06/24/news/Israel-Sarkozy.php
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NABLUS, West Bank: Israeli forces killed two Palestinians, including an Islamic Jihad commander, in the West Bank city of Nablus on Tuesday in the first fatal raid since a ceasefire took hold in the Gaza Strip last week.
Islamic Jihad threatened to launch attacks inside Israel to avenge the death of Tarek Juma Abu Ghali, whom the militant group described as one of its most senior commanders in the northern West Bank.
A second Palestinian, affiliated with the Islamist militant group Hamas, was also killed in the overnight raid, Palestinian security sources said.
The killings, which were confirmed by the Israeli army, could test the fragile ceasefire that took effect last Thursday between Israel and militants in the Hamas-controlled Gaza Strip.
"Calm in Gaza does not mean that we will sit in our seats waiting to be slaughtered one by one," Islamic Jihad said in a statement. "This crime will not pass without punishment and the coming days will be a witness to that."
Hamas, which claimed responsibility for a shooting attack that injured three Israeli hikers near a West Bank settlement on Friday, also called on Palestinian groups in the West Bank to retaliate for the killings, saying they had a right to do so because the ceasefire deal was limited to the Gaza Strip.
Western-backed Palestinian Prime Minister Salam Fayyad departed from his prepared remarks at a security conference in Berlin to condemn the Nablus raid.
"This is the kind of activity that has to stop, and has to stop promptly, if we are going to be able to succeed," Fayyad said. "Our own political credibility will continue to be at stake as long as those kinds of incursions continue."
The Berlin conference is meant to bolster Palestinian police forces so they can assume greater security responsibilities in the Israeli-occupied West Bank.
Officials on both sides doubt the truce in the Gaza Strip will last.
The army on Tuesday confirmed that Palestinians fired a mortar shell into Israel from Gaza overnight in the first reported violation by militants of the ceasefire.
No one was hurt by the mortar shell and there was no immediate claim of responsibility.
Hamas official Sami Abu Zuhri said his group was not aware of the incident and remained committed to the truce.
An Israeli army spokesman said the Islamic Jihad commander killed in Nablus had directed "terrorist squads" and was involved in making explosive devices.
Nablus Governor Jamal Muheisen called the Israeli raid in the city an "unjustified crime" but said he did not believe it would threaten the Gaza truce.
Under the ceasefire deal, brokered by Egypt, Hamas agreed to prevent other militant groups in the Gaza Strip, including Islamic Jihad, from launching cross-border attacks.
Israel also agreed to halt fighting in the Gaza Strip and to gradually relax its economic blockade on the enclave.
Security forces loyal to Palestinian President Mahmoud Abbas deployed in Nablus late last year as part of a Western-backed law-and-order campaign. But Palestinian officials say frequent Israeli raids into the city have undermined that effort.
http://www.iht.com/articles/reuters/2008/06/24/africa/OUKWD-UK-PALESTINIANS-ISRAEL-VIOLENCE.php
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3 rockets from Gaza breach truce
JERUSALEM: Three rockets fired from Gaza on Tuesday struck the Israeli border town of Sderot and its environs, causing no injuries but constituting the first serious breach of a five-day-old truce mediated by Egypt between Israel and Hamas, the Islamic organization that controls Gaza.
The crack in the calm came on the eve of a looming political crisis in Israel: Barring last-minute maneuvers and backroom deals, a preliminary reading of a bill for the dissolution of the Israeli Parliament scheduled for Wednesday was expected to gain a majority of votes in the legislature, threatening a break-up of the country's governing coalition.
Mark Regev, a spokesman for Prime Minister Ehud Olmert, said the rocket fire from Gaza was "a grave violation of the calm" that came into effect last Thursday, but he did not comment on whether Israel would react.
Islamic Jihad, a small extremist group, claimed responsibility for the attack and said it was an answer to an Israeli military raid in the West Bank city of Nablus at dawn Tuesday in which a senior Islamic Jihad operative and another Palestinian man were killed.
Palestinian officials identified the two men killed as Tareq Abu Ghali, 24, and Iyad Khanfar, 21, a university student.
An Israeli Army spokesman said that Abu Ghali had been involved in terrorism and that he was "killed in an exchange of fire."
The man killed with him was armed, the spokesman said.
Under pressure from Hamas, Islamic Jihad had agreed to abide by the temporary truce, which was meant to apply only to Gaza, but had balked at the idea of not responding to Israeli military actions in the West Bank.
Previous cease-fire understandings in Gaza have fallen apart over the inability of Palestinian leaders to contain smaller groups. Hamas has been in full control of Gaza for the past year and Israel has said it will hold Hamas responsible for fully enforcing the calm.
A single mortar shell was also fired from Gaza late Monday night and landed on the Israeli side of the border fence.
The rocket attack occurred hours after Olmert met President Hosni Mubarak of Egypt in the Red Sea resort of Sharm el Sheik to discuss next steps in the tenuous truce and the renewal of efforts to resolve the case of Gilad Shalit, an Israeli corporal who has been held captive by Hamas in Gaza for two years.
At the same time, there has been an apparent hitch in what was supposed to be an imminent prisoner exchange between Israel and the Lebanese militant group Hezbollah.
Israel seemed to be preparing to declare that two of its soldiers held by the group since July 2006 are presumed to be dead - a conclusion that could theoretically reduce the price that Israel is willing to pay for their return.
The two soldiers, Ehud Goldwasser and Eldad Regev, were badly wounded during their capture in an ambush across the Israeli border by Hezbollah, which set off a month-long war.
Hezbollah has offered no proof that they are still alive
Olmert said Tuesday that the indirect negotiations with Hezbollah were continuing but would take more time.
The emotional issue of the captured and missing soldiers has stirred public outrage in Israel, along with a sense of government bungling and indecision.
Against the backdrop of a high-profile corruption investigation of Olmert, the Labor Party, led by Defense Minister Ehud Barak, said it intended to back the preliminary vote Wednesday for the dissolution of Parliament. Initiated by the opposition, the bill is a first step toward early elections.
Labor is a crucial junior partner to Olmert's Kadima Party in the governing coalition, but Barak called in late May for Olmert to step down from his post pending the outcome of the police investigation.
In a counterstrike, however, Olmert has said he will not tolerate ministers in his government working toward its demise. An aide to the prime minister said Tuesday that Olmert was "very determined" to fire any ministers "who vote to shorten the life of the government."
Without Labor, Olmert would be left in charge of a minority government whose days would almost certainly be numbered.
Another coalition partner, the ultra-Orthodox Shas, also threatened to back the dissolution bill unless Olmert agreed to a significant raise in child allowances, a demand the prime minister refused to meet by Tuesday.
The political turmoil has compounded public cynicism about the government's decisions and motivations.
Alex Fishman, the military affairs correspondent of the mass-circulation daily newspaper Yediot Aharonot, described the politicians' conduct on the prospective deal with Hezbollah as "shameless."
"The elections have driven these people mad," he wrote in the newspaper Tuesday. "Nothing in this story about the captives and the MIAs is true anymore," he said, referring to soldiers missing in action.
http://www.iht.com/articles/2008/06/24/mideast/mideast.php
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OPINION
ISRAEL AND THE PALESTINIANS
Occupation by bureaucracy
Saree Makdisi is professor of English literature at the University of California, Los Angeles and author of "Palestine Inside Out: An Everyday Occupation."
A cease-fire went into effect in Gaza last week, offering some respite from the violence that has killed hundreds of Palestinians and five Israelis in recent months. It will do nothing, however, to address the underlying cause of the Israeli-Palestinian conflict.
Intermittent spectacular violence may draw the world's attention to the occupied Palestinian territories, but our obsession with violence actually distracts us from the real nature of Israel's occupation, which is its smothering bureaucratic control of everyday Palestinian life.
This is an occupation ultimately enforced by tanks and bombs, and through the omnipresent threat, if not application, of violence. But its primary instruments are application forms, residency permits, population registries and title deeds. On its own, no cease-fire will relieve the beleaguered Palestinians.
Gaza is virtually cut off from the outside world by Israeli power. Elsewhere, in the West Bank and East Jerusalem, the ongoing Israeli occupation comprehensively infuses all the normally banal activities of Palestinians' everyday lives: applying for permission to access one's own land; applying for what Israel regards as the privilege - rather than the right - of living with one's spouse and children; applying for permission to drive one's car; to dig a well; to visit relatives in the next town; to visit Jerusalem; to go to work; to school; to university; to hospital. There is hardly any dimension of everyday life in Palestine that is not minutely managed by Israeli military or bureaucratic personnel.
Partly, this occupation of everyday life enables the Israelis to maintain their vigilant control over the Palestinian population. But it also serves the purpose of slowly, gradually removing Palestinians from their land, forcing them to make way for Jewish settlers.
http://www.iht.com/articles/2008/06/24/opinion/edmakdisi.php
Quarter of Ethiopia AIDS patients have stopped drugs
ADDIS ABABA: Over a quarter of Ethiopia's HIV/AIDS patients on drugs are not taking their medicine because of logistical problems but also due to religious beliefs, the head of a treatment body said on Tuesday.
Over 40,000 of Ethiopia's 156,360 HIV/AIDS patients on the life-prolonging medication have discontinued treatment "due to problems of transportation to hospitals," said Dr Ygeremu Abebe, the director of the Clinton Foundation in Ethiopia.
Some however stopped taking the anti-retroviral medicine on the prompting of religious leaders who encouraged them to take "holy water" instead, he said.
"Lack of awareness of serious health problem for patients who discontinue treatment could also be considered a reason," Ygeremu told a workshop on the disease.
Some 20 percent of 7,000 children with the illness have also stopped medication, he said.
http://www.iht.com/articles/reuters/2008/06/24/africa/OUKWD-UK-ETHIOPIA-AIDS.php
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U.S. criticized over funds for Haiti
An array of rights groups has strongly criticized the U.S. government for withholding money meant to provide clean drinking water to Haiti, charging that the action is meant to be leverage for political change in the country.
In a report made public Monday, the activists call the delay of $54 million in international loans to the Haitian government "one of the most egregious examples of malfeasance by the United States in recent years."
The loans from the Inter-American Development Bank were intended to revamp the water and sanitation systems in Les Cayes and Port-de-Paix. In Haiti, close to 70 percent of the population lacks regular and direct access to potable water, experts said. The lack of clean water contributes to intestinal parasites and amoebic dysentery.
The development bank, over which the U.S. Treasury Department holds significant influence, approved the loans in 1998.
The water projects have yet to be started, the report says, "largely the result of aggressive attempts by the U.S. government to block the disbursement of these loans."
http://www.iht.com/articles/2008/06/24/america/haiti.php
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U.S. envoy to Albania linked to cover-up of Afghan arms deal
WASHINGTON: A U.S. ambassador helped cover up the illegal Chinese origins of ammunition the Pentagon bought to supply Afghan security forces, according to testimony gathered by congressional investigators.
A military attaché has told the investigators that the U.S. ambassador to Albania endorsed a plan by the Albanian defense minister to hide several boxes of Chinese ammunition from a visiting reporter.
The ammunition was being repackaged to disguise its origins and shipped from Albania to Afghanistan by AEY, a Miami Beach arms-dealing company.
The ambassador, John Withers 2nd, met with the defense minister, Fatmir Mediu, hours before a reporter for The New York Times was to visit the American contractor's operations in Tirana, the Albanian capital, according to the testimony. The Pentagon bought the ammunition to supply Afghan security forces, although U.S. law prohibits trading in Chinese arms.
The attaché, Major Larry Harrison 2nd of the army, was one of the aides attending the late-night meeting on Nov. 19, 2007. He told House investigators that Mediu asked Withers for help, saying he was concerned that the reporter would reveal that he had been accused of profiting from selling weapons.
http://www.iht.com/articles/2008/06/24/europe/arms.php
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Report sees illegal hiring practices at U.S. Justice Dept.
WASHINGTON: Justice Department officials over the past six years illegally used "political or ideological" factors to hire new lawyers into an elite recruitment program, tapping law school graduates with conservative credentials over those with liberal-sounding résumés, says a report released Tuesday.
The blistering report, prepared by the Justice Department's inspector general, is the first in what will be a series of investigations growing out of the scandal last year over the firings of nine United States attorneys. It appeared to confirm for the first time in an official examination many of the allegations from critics who charged that the Justice Department had become overly politicized during the administration of President George W. Bush.
"Many qualified candidates" were rejected for the department's honors program because of what was perceived as a liberal bias, the report says. Those practices, the report concludes, "constituted misconduct and also violated the department's policies and civil service law that prohibit discrimination in hiring based on political or ideological affiliations."
The shift began in 2002, when advisers to then-Attorney General John Ashcroft restructured the honors program in response to what some officials saw as a liberal tilt in recruiting young lawyers from elite law schools like Harvard and Yale. While the recruitment was once controlled largely by career officials in each section who reviewed applications, political officials in the department began to assume more control, rejecting candidates with liberal or Democratic affiliations "at a significantly higher rate" than those with Republican or conservative credentials, the report says.
The shift appeared to accelerate in 2006, under then-Attorney General Alberto Gonzales, with two aides on the screening committee - Michael Elston and Esther Slater McDonald - singled out for particular criticism. The blocking of applicants with liberal credentials appeared to be a particular problem in the Justice Department's civil rights division, which has seen an exodus of career employees in recent years as the department has pursued a more conservative agenda in deciding what types of cases to bring.
http://www.iht.com/articles/2008/06/24/america/justice.php
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Court voids finding on Guantánamo detainee
In the first civilian judicial review of the government's evidence for holding any of the Guantánamo Bay detainees, a federal appeals court has ordered that one of them be released or given a new military hearing.
The ruling, made known Monday in a notice from the United States Court of Appeals for the District of Columbia Circuit, overturned a Pentagon tribunal's decision in the case of one of 17 Guantánamo detainees who are ethnic Uighurs, a Muslim minority from western China.
The imprisonment of the 17 Uighurs (pronounced WEE-goors) has drawn wide attention because of their claim that although they were in Afghanistan when the United States invaded in 2001, they were never enemies of this country and were mistakenly swept into Guantánamo.
The court's decision was a new setback for the Bush administration, which has suffered a string of judicial defeats on Guantánamo policy, most recently in a Supreme Court ruling on June 12 that dealt with a separate issue of detainee rights. The Uighur case was argued long before that ruling by the justices.
The one-paragraph notice from the appeals court said a three-judge panel had found in favor of Huzaifa Parhat, a former fruit peddler who made his way from western China to a Uighur camp in Afghanistan.
"The court directed the government to release or to transfer Parhat, or to expeditiously hold a new tribunal," the notice said. It said the court had found "invalid" the military's decision that he was an enemy combatant.
http://www.iht.com/articles/2008/06/24/america/24combatant.php
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Government report criticizes how Bush measures progress in Iraq
Beyond the declines in overall violence in Iraq, several crucial measures the Bush administration uses to demonstrate economic, political and security progress are either incorrect or far more mixed than the administration has acknowledged, according to a report by the Government Accountability Office.
Over all, the report released Monday says, the American plan for a stable Iraq lacks a strategic framework that meshes with the administration's goals, is falling out of touch with the conditions on the ground and contains serious flaws in its operational guidelines.
Newly declassified data in the report on countrywide attacks in May show that increases in violence during March and April that were touched off by an Iraqi government assault on militias in Basra have given way to a calmer period. Numbers of daily attacks have been comparable to those earlier in the year, representing about a 70 percent decline since June 2007, the data show.
While those figures confirm the assessments by U.S. military commanders that many of the security improvements that first became apparent last autumn are still holding, a number of the figures that have been used to show broader progress in Iraq are either misleading or simply incorrect, the report says.
Administration figures, the report says, broadly overstate gains in some categories, including the readiness of the Iraqi Army, electricity production and how much money Iraq is spending on its reconstruction.
And the security gains themselves rest in large part not on broad-scale advances in political and social reconciliation and a functioning Iraqi government, but on a few specific advances that remain fragile, the report says.
The relatively calm period rests mostly on the U.S. troop increase, a shaky cease-fire declared by militias loyal to the Shiite cleric Moktada al-Sadr, and a U.S.-led program to pay former insurgents to help keep the peace, the report says.
"Clearly there are substantial changes in the security situation on the ground," said Nathan Freier, a retired U.S. Army officer who served in Iraq in 2005 and 2007 and is a senior fellow in the international security program at the Center for Strategic and International Studies in Washington.
The administration prefers to focus on those improvements, Freier said. But the accountability office report, which Freier read Monday, and his own observations in Iraq contain a different message, he said: "Iraq remains a mixed bag and will continue to do so in perpetuity, to be quite honest."
Letters from the Treasury Department, the State Department and the Pentagon attached to the report all disagreed with many of its central findings.
http://www.iht.com/articles/2008/06/24/mideast/benchmarks.php
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10 killed in Sadr City bombing
BAGHDAD: An explosion apparently caused by a bomb in a district council building in the Sadr City neighborhood of Baghdad killed two American soldiers, at least six Iraqis and two civilians working for the U.S. military on Tuesday, the American command said.
Iraqi council members who were at the scene of the attack described the civilians as American.
The U.S. military said a suspect in the apparent bombing had been detained.
Sadr City is the most populous Shiite district of the Iraqi capital and a stronghold of the Mahdi army, the militia loyal to the anti-American cleric Moktada al-Sadr.
The explosion occurred around 9:30 a.m. as four council officials were gathering in a room for a meeting with five Americans to discuss the election of senior local council members, said a spokesman for the Iraqi group.
A third American soldier was wounded in the attack, the military said.
http://www.iht.com/articles/2008/06/24/mideast/iraq.php
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Baghdad's minibus taxis bridge sectarian divide
BAGHDAD: Baghdad's minibus taxi drivers are returning to once deadly routes as security in the Iraqi capital improves, allowing them once again to drive between Sunni and Shi'ite areas and link divided communities.
As Iraq drifted towards civil war in 2006 and early 2007, many areas in Baghdad became sectarian no-go zones. Minibus taxi drivers found themselves on the front-line, targeted by militias who wanted to entrench divisions through fear.
"The criminals tried to separate and isolate areas ... but they could not do it," said Abu Ala, who drives a minibus taxi between the Sunni Arab town of Taji, near the capital, to Kadhimiya, a Shi'ite area of northern Baghdad.
At the height of the violence, minibus taxi operators risked being stopped at fake checkpoints where death squads abducted drivers or passengers from the wrong side of the sectarian divide. Some turned up dead days later. Many are still missing.
"The militants focused on fighting the drivers just to separate the districts of Baghdad. But they absolutely failed," said another driver Nazar Abdul-Karim.
http://www.iht.com/articles/reuters/2008/06/24/africa/OUKWD-UK-IRAQ-TAXIS.php
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Poll shows broad religious tolerance among Americans
Although a majority of Americans say religion is very important to them, nearly three-quarters of them say they believe that many faiths besides their own can lead to salvation, according to a survey by the Pew Forum on Religion and Public Life.
The report, the U.S. Religious Landscape Survey, reveals a broad trend toward tolerance and an ability among many Americans to hold beliefs that might contradict the doctrines of their professed faiths.
For example, 70 percent of Americans affiliated with a religion or denomination said they agreed that "many religions can lead to eternal life," including majorities among Protestants and Catholics.
Among evangelical Christians, 57 percent agreed with the statement, and among Catholics, 79 percent did.
Among minority faiths, more than 80 percent of Jews, Hindus and Buddhists agreed with the statement, and more than half of Muslims did.
http://www.iht.com/articles/2008/06/24/america/religion.php
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Obama campaign accuses McCain aide of exploiting terror fears
WASHINGTON: An adviser to Barack Obama accused the campaign of John McCain on Tuesday of injecting "the politics of fear" into the presidential race by suggesting that a pre-election terrorist attack on the United States would give the Republican senator a "big advantage."
McCain immediately rejected the remark made by his chief strategist, Charles Black, in an interview with Forbes magazine. Black himself said he deeply regretted the comment.
Forbes magazine also quoted Black as saying that the assassination last year of the Pakistani opposition leader Benazir Bhutto had been an "unfortunate event," but one that underscored the importance of McCain's security background.
"His knowledge and ability to talk about it re-emphasized that this is the guy who's ready to be commander-in-chief; and it helped us," Black said. As to a new terrorist attack, "Certainly it would be a big advantage to him."
The Obama campaign seized on Black's statement - a clear political faux pas, even if some analysts believe it may be true - to issue a sharp warning to the McCain camp against stoking fears of terrorism for electoral gain, something many Democrats have bitterly complained about for years.
http://www.iht.com/articles/2008/06/24/america/campaign.php
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COLUMNIST
Brooks: Look at that surge
Let's go back and consider how the world looked in the winter of 2006-2007.
Iraq was in free fall, with horrific massacres and ethnic cleansing that sent a steady stream of bad news across the world media.
The American public delivered a stunning electoral judgment against the Iraq war, the Republican Party and President George W. Bush.
Expert and elite opinion swung behind the Baker-Hamilton report, which called for handing more of the problems off to the Iraqi military and wooing Iran and Syria.
Republicans on Capitol Hill were quietly contemptuous of the president while Democrats were loudly so. Barack Obama called for a U.S. withdrawal starting in the spring of 2007, while Senator Harry Reid offered legislation calling for a complete U.S. pullback by March 2008.
The arguments floating around the op-ed pages and seminar rooms were overwhelmingly against the idea of a surge - a mere 20,000 additional troops would not make a difference; the U.S. presence provoked violence, rather than diminishing it.
The more the United States did, the less the Iraqis would step up to do. Iraq was in the middle of a civil war, and it was insanity to put American troops in the middle of it.
When Bush consulted his own generals, the story was much the same. Almost every top general, including Abizaid, Schoomaker and Casey, were against the surge. Secretary of State Condoleezza Rice was against it, according to recent reports. Iraqi Prime Minister Nuri Kamal al-Maliki called for a smaller U.S. presence, not a bigger one.
In these circumstances, it's amazing that Bush decided on the surge. And looking back, one thing is clear: Every personal trait that led Bush to make a hash of the first years of the war led him to make a successful decision when it came to this crucial call.
Bush is a stubborn man. Well, without that stubbornness, that unwillingness to accept defeat on his watch, he never would have bucked the opposition to the surge.
Bush is an outrageously self-confident man. Well, without that self-confidence he never would have overruled his generals.
In fact, when it comes to Iraq, Bush was at his worst when he was humbly deferring to the generals and at his best when he was arrogantly overruling them.
During that period in 2006 and 2007, Bush stiffed the brass and sided with a band of dissidents: Military officers like David Petraeus and Raymond Odierno, senators like John McCain and Lindsey Graham, and outside strategists like Fred Kagan of the American Enterprise Institute and Jack Keane, a retired general.
Bush is also a secretive man who listens too much to Dick Cheney. Well, the uncomfortable fact is that Cheney played an essential role in promoting the surge. Many of the people who are dubbed bad guys actually got this one right.
The additional fact is that Bush, who made such bad calls early in the war, made a courageous and astute decision in 2006.
More than a year on, the surge has produced large, if tenuous, gains. Violence is down sharply. Daily life has improved. Iraqi security forces have been given time to become a more effective fighting force. The Iraqi government is showing signs of strength and even glimmers of impartiality. Iraq has moved from being a failed state to - as Vali Nasr of the Council on Foreign Relations has put it - merely a fragile one.
The whole episode is a reminder that history is a complicated thing. The traits that lead to disaster in certain circumstances are the very ones that come in handy in others. The people who seem so smart at some moments seem incredibly foolish in others.
The cocksure war supporters learned this humbling lesson during the dark days of 2006. And now the cocksure surge opponents, drunk on their own vindication, will get to enjoy their season of humility.
They have already gone through the stages of intellectual denial.
First, they simply disbelieved that the surge and the Petraeus strategy was doing any good. Then they accused people who noticed progress in Iraq of duplicity and derangement. Then they acknowledged military, but not political, progress. Lately they have skipped over to the argument that Iraq is progressing so well that the U.S. forces can quickly come home.
But before long, the more honest among the surge opponents will concede that Bush, that supposed dolt, actually got one right. Some brave souls might even concede that if the United States had withdrawn in the depths of the chaos, the world would be in worse shape today.
Life is complicated. The reason we have democracy is that no one side is right all the time. The only people who are dangerous are those who can't admit, even to themselves, that obvious fact.
http://www.iht.com/articles/2008/06/24/opinion/edbrooks.php
Think air travel is stressful? Just wait until the autumn
I am not in the business of dispensing advice, but here is some nevertheless:
It's summer. Air travel is bad. It's getting even worse and won't improve anytime soon. And there is absolutely nothing you or I can do about it. So chill.
Last week, I was on a flight to Newark, New Jersey, from Houston that landed around 9 p.m., about 45 minutes late, and then sat for nearly a half-hour while the crew tried to round up somebody to operate the jetway so that the door could be opened and people could get off. In the aisle, some passengers were crying because they had now missed connections, including international flights.
"Make sure they give you a hotel voucher," I said, trying to be helpful, to a woman near me whose connecting flight to Bangor, Maine, the last that night, had already departed. "The least they can do is buy you a night in Newark."
She glared at me silently through damp eyes.
http://www.iht.com/articles/2008/06/24/business/road.php
Leadership void seen in Pakistan
ISLAMABAD, Pakistan: Pakistan is in a leaderless drift four months after elections, according to Western diplomats and military officials, Pakistani politicians and Afghan officials who are increasingly worried that no one is really in charge.
The sense of drift is the subject of almost every columnist in the English-language press in Pakistan, and anxiety over the lack of leadership and the weakness of the civilian government now infuses conversations with analysts, diplomats and Pakistani government officials.
The problem is most acute, they say, when it comes to dealing with militants in the tribal areas that have become home to the Taliban and Al Qaeda.
Although the political parties and the military all seek a breather from the suicide bombings and nascent insurgency that have roiled Pakistan in recent years, there are fundamental disagreements over the problem of militancy that they have not begun to address, Pakistani politicians and Western diplomats say.
The confusion is allowing the militants to consolidate their sanctuaries while spreading their tentacles all along the border area, military officials and diplomats warn. It has also complicated policy for the Bush administration, which leaned heavily on one man, President Pervez Musharraf, to streamline its antiterrorism efforts in Pakistan.
http://www.iht.com/articles/2008/06/24/asia/24pstan.php
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Air strikes kill 14 Taliban in Afghan east
KHOST, Afghanistan: Afghan police backed by NATO air strikes killed 14 Taliban insurgents after the militants attacked a small town in eastern Afghanistan, the Interior Ministry said on Tuesday.
The Taliban have overrun a number of isolated small towns in the last two years, briefly taking control of local government buildings and forcing thinly spread Afghan and international troops to mobilise forces to chase them out.
Taliban insurgents attacked a police headquarters in the district of Sayed Karam in Paktia province overnight. Police returned fire and international troops launched air strikes.
"This incident which lasted until morning and resulted in bombing by international forces killed 14 insurgents and wounded four more with support from national police," the Interior Ministry said in a statement.
The insurgents were from Pakistan, Chechnya and Uzbekistan, it said. The militants fled the scene in a vehicle.
http://www.iht.com/articles/reuters/2008/06/24/asia/OUKWD-UK-AFGHAN-VIOLENCE.php
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Pakistani Taliban said pulling out of captured town
PESHAWAR, Pakistan: Pakistani Taliban militants began withdrawing from a northwestern town on Tuesday after capturing it the previous day in a bloody clash with rivals, a government and a security official said.
Militants loyal to notorious Taliban commander Baitullah Mehsud seized the town of Jandola, on the main road into the South Waziristan ethnic Pashtun tribal region on the Afghan border.
At least 12 people, most of them members of the pro-government Bitani tribe, were killed. The militants also captured 13 of their rivals, a government official said.
The fighting follows government attempts to end violence by Mehsud through talks despite concerns from the United States, which says negotiations and peace deals give militants a free hand to plot attacks.
"The situation has improved. There has been no untoward incident today and they're moving out," Barkatullah Marwat, the top government officer in the region, told Reuters.
http://www.iht.com/articles/reuters/2008/06/24/asia/OUKWD-UK-PAKISTAN-VIOLENCE.php
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Germany intends to increase its troops in Afghanistan
BERLIN: Under pressure from NATO, Germany announced Tuesday that it would increase the number of troops available for duty in Afghanistan by almost one-third to 4,500, but would continue to keep the bulk of its forces away from the more violent southern provinces.
Defense Minister Franz Josef Jung said the government wanted to increase the number of troops it can send to Afghanistan by 1,000, after a parliamentary mandate limiting the deployment to 3,500 expires in October. The increase will require the approval of the lower house of Parliament, the Bundestag.
Germany has resisted calls from several of its NATO allies to send its soldiers to the south of the country, where some contingents from the total force of 60,000 - more than half of them American - are facing stubborn resistance from resurgent Taliban fighters.
"Our area of responsibility remains the Regional Command North," Jung said Tuesday at a news conference. The new mandate would allow about 40 communications specialists to operate in the south. According to the German Defense Ministry, it would also triple the training support for the Afghan Army.
"When you speak to officers in the field, they tell you they'd rather have one soldier with no strings attached, or what are called caveats, than five soldiers with caveats," said Tomas Valasek, a defense expert at the Center for European Reform, a research institute in London.
http://www.iht.com/articles/2008/06/24/europe/germany.php
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Pakistan court bars Sharif from election
ISLAMABAD, Pakistan: A high court on Monday barred the leader of the junior partner in the government, Nawaz Sharif, from running for Parliament in a by-election later this week, a decision that is bound to intensify the hostilities within the fractious ruling coalition.
Sharif, who was twice prime minister and is now the most popular politician in the nation, according to some opinion polls, has differed with the leader of the coalition, Asif Ali Zardari, over the reinstatement of judges fired last November during emergency rule.
The ruling against Sharif by the High Court in Lahore was made by three judges appointed by President Pervez Musharraf after he declared the emergency rule.
The three judges are among those who Sharif contends were illegally appointed. He has made a major public issue about the independence of the judiciary since the government took office in late February, and called for the reinstatement of judges fired by Musharraf, and the dismissal of those he had appointed.
In contrast, Zardari, the widower of Benazir Bhutto, the opposition leader who was assassinated in December, has said that he believes that the judges appointed to the Supreme Court and four High Courts by Musharraf should be allowed to stay.
http://www.iht.com/articles/2008/06/24/asia/24sharif.php
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Sharif party sees Musharraf behind poll bar
ISLAMABAD: The party of former Pakistani prime minister Nawaz Sharif on Tuesday blamed President Pervez Musharraf for Sharif's disqualification from a by-election for a National Assembly seat.
Sharif, the prime minister that army chief at the time Musharraf ousted in a 1999 coup, had been expected to return to parliament in a by-election this week, but on Monday a high court in the eastern city of Lahore barred him from running.
The disqualification compounds political uncertainty that has helped undermine confidence in Pakistani stocks, but the main index rose more than 4 percent on Tuesday after authorities acted to slow a fall in a market that touched its lowest level in more than 15 months the previous day.
Party spokesman Ahsan Iqbal said Sharif had been disqualified at Musharraf's behest and it underlined the importance of restoring judges Musharraf dismissed last year and of getting rid of a president critics regard as unconstitutional.
"It's the same script, written by General Musharraf," Iqbal said. "This will give new impetus to the movement for the restoration of an independent judiciary and the removal of General Musharraf."
http://www.iht.com/articles/reuters/2008/06/24/asia/OUKWD-UK-PAKISTAN-SHARIF.php
In separate attacks before dawn, gunmen killed six men, including a father and son, and dumped the bodies of two other victims in the trunk of an abandoned car, police said.
"They came for the father and the son tried to protect him and it cost him his life," a police spokesman said.
It was the fourth day in a new wave of gruesome shootings in the city bordering El Paso, Texas, that saw gunmen kill 17 people on Sunday alone.
Tuesday's murders take the death toll to over 500 people in Ciudad Juarez since the start of the year, making it the most deadly city in Mexico's drug war, despite a large deployment of well-armed troops and federal police.
ALL PHOTOGRAPHS COPYRIGHT IAN WALTHEW 2008
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