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US: Republicans set 2012 budget battle with Obama

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© Reuters/Kevin Lamarque
House Budget Committee Chairman Paul Ryan (R-WI) unveils the House Republican budget blueprint in the Capitol in Washington April 5, 2011.
Republicans in the House of Representatives united on Friday behind a 2012 budget plan slashing trillions of dollars in government spending while cutting taxes -- two achievements conservatives say are necessary ingredients for a deal to raise the U.S. debt limit.

The vote effectively serves as the Republicans' opening gambit in what are likely to be contentious negotiations with President Barack Obama and his Democrats over debt and deficits in the coming months. The Congress must decide within weeks on raising the $14.3 trillion debt ceiling.

By a vote of 235-193, the House passed the plan written by House Budget Committee Chairman Paul Ryan for the 2012 fiscal year beginning October 1.

Democrats rejected the measure, which proposes slashing spending by nearly $6 trillion over a decade and reducing benefits for the elderly and poor. All but four Republicans supported it.

There is almost no chance of the Senate approving the measure in its current form.

The White House swiftly condemned the measure but said it was committed to working with Republicans to bring down record deficits that all sides acknowledged imperil the country's economic future.

Bad Guys

Emails expose BP's attempts to control research into impact of Gulf oil spill

 <em>Deepwater Horizon</em> BP oil spill: A clean-up worker picks up blobs of oil in absorbent snare
© Gerald Herbert/AP
A clean-up operation on Queen Bess Island, June 2010. BP pledged a $500m fund for independent research into the consequences of the Gulf of Mexico oil disaster.

Documents obtained under the Freedom of Information Act show BP officials discussing how to influence the work of scientists

BP officials tried to take control of a $500m fund pledged by the oil company for independent research into the consequences of the Gulf of Mexico oil disaster, it has emerged.

Documents obtained under the Freedom of Information Act show BP officials openly discussing how to influence the work of scientists supported by the fund, which was created by the oil company in May last year.

Russell Putt, a BP environmental expert, wrote in an email to colleagues on 24 June 2010: "Can we 'direct' GRI [Gulf of Mexico Research Initiative] funding to a specific study (as we now see the governor's offices trying to do)? What influence do we have over the vessels/equipment driving the studies vs the questions?".

Family

Scientists warn that drugs of the future will be designed specifically to control the human mind

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© Erin Jonasson
Coming soon ... a pill to enhance moral behaviour.
It may sound like something out of a science fiction plot, but Oxford researchers say that modern conventional medicine is gradually developing ways to change the moral states of humans through pharmaceutical drugs, and thus control the way people think and act in various life situations. These new drugs will literally have the ability to disrupt an individual's personal morality, and instead reprogram that person to believe and do whatever the drug designer has created that drug to do.

"Science has ignored the question of moral improvement so far, but it is now becoming a big debate," said Dr. Guy Kahane from the Oxford Centre for Neuroethics in the UK. "There is already a growing body of research you can describe in these terms. Studies show that certain drugs affect the ways people respond to moral dilemmas by increasing their sense of empathy, group affiliation and by reducing aggression."

USA

False pretense for war in Libya?

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© Getty Images
Evidence is now in that President Barack Obama grossly exaggerated the humanitarian threat to justify military action in Libya. The president claimed that intervention was necessary to prevent a "bloodbath'' in Benghazi, Libya's second-largest city and last rebel stronghold.

But Human Rights Watch has released data on Misurata, the next-biggest city in Libya and scene of protracted fighting, revealing that Moammar Khadafy is not deliberately massacring civilians but rather narrowly targeting the armed rebels who fight against his government.

Misurata's population is roughly 400,000. In nearly two months of war, only 257 people - including combatants - have died there. Of the 949 wounded, only 22 - less than 3 percent - are women. If Khadafy were indiscriminately targeting civilians, women would comprise about half the casualties.

Star of David

Italian Free Gaza Movement activist abducted and murdered by "Islamist militants"

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© AP
Italian activist Vittorio Utmpio Arrigoni holds his passport during a protest against the Israeli siege on Gaza, in Gaza City, in this August 29, 2008 file photo.
Two suspects have reportedly been arrested in the alleged kidnapping and subsequent murder of Vittorio Arrigoni, an activist in the International Solidarity Movement; Arrigoni was hanged in an Islamist militant's home.

The body of an Italian pro-Palestinian activist was found hanging in the home of a Palestinian militant in the Gaza Strip early Friday, hours after he was reportedly kidnapped.

Hamas officials reported that the body of Vittorio Arrigoni, 36, was discovered in the home of a member of the Monotheism and Holy War group that claimed responsibility for the abduction in a video released Thursday.

Bad Guys

9 Things The Rich Don't Want You To Know About Taxes

Puppet Masters
© berkleyillustration.etsy.com

For three decades we have conducted a massive economic experiment, testing a theory known as supply-side economics. The theory goes like this: Lower tax rates will encourage more investment, which in turn will mean more jobs and greater prosperity - so much so that tax revenues will go up, despite lower rates. The late Milton Friedman, the libertarian economist who wanted to shut down public parks because he considered them socialism, promoted this strategy. Ronald Reagan embraced Friedman's ideas and made them into policy when he was elected president in 1980.

For the past decade, we have doubled down on this theory of supply-side economics with the tax cuts sponsored by President George W. Bush in 2001 and 2003, which President Obama has agreed to continue for two years.

You would think that whether this grand experiment worked would be settled after three decades. You would think the practitioners of the dismal science of economics would look at their demand curves and the data on incomes and taxes and pronounce a verdict, the way Galileo and Copernicus did when they showed that geocentrism was a fantasy because Earth revolves around the sun (known as heliocentrism). But economics is not like that. It is not like physics with its laws and arithmetic with its absolute values.

Tax policy is something the framers left to politics. And in politics, the facts often matter less than who has the biggest bullhorn.

Rocket

911 Survivor Won't Back Down

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© Unknown
Perhaps the most compelling direct testimony regarding the harrowing events of Sept. 11, 2001 comes from survivor and former Army Spec. April Gallop, who - with her two-month-old child, Elisha, in tow - arrived at the Pentagon just minutes before a powerful explosion rocked the building that Tuesday morning. Ms. Gallop spoke out on her experience at conferences where this AFP writer heard her story - which has never wavered.

Ms. Gallop wants justice. So, in coordination with the Center for 911 Justice, she filed a federal lawsuit and is staying the course, whatever the odds. The defendants are former Vice President Dick Cheney, former Defense Secretary Donald Rumsfeld, and Gen. Richard Myers (USAF, retired), former acting Joint Chiefs of Staff chairman.

Heart - Black

The Real Housewives of Wall Street: Why is the Federal Reserve forking over $220 million in bailout money to the wives of two Morgan Stanley bigwigs?

Christy Mack ,Susan Karches
© Victor Juhazz
America has two national budgets, one official, one unofficial. The official budget is public record and hotly debated: Money comes in as taxes and goes out as jet fighters, DEA agents, wheat subsidies and Medicare, plus pensions and bennies for that great untamed socialist menace called a unionized public-sector workforce that Republicans are always complaining about. According to popular legend, we're broke and in so much debt that 40 years from now our granddaughters will still be hooking on weekends to pay the medical bills of this year's retirees from the IRS, the SEC and the Department of Energy.

Why Isn't Wall Street in Jail?

Most Americans know about that budget. What they don't know is that there is another budget of roughly equal heft, traditionally maintained in complete secrecy. After the financial crash of 2008, it grew to monstrous dimensions, as the government attempted to unfreeze the credit markets by handing out trillions to banks and hedge funds. And thanks to a whole galaxy of obscure, acronym-laden bailout programs, it eventually rivaled the "official" budget in size - a huge roaring river of cash flowing out of the Federal Reserve to destinations neither chosen by the president nor reviewed by Congress, but instead handed out by fiat by unelected Fed officials using a seemingly nonsensical and apparently unknowable methodology.

Eagle

US: Congress voting Thursday on budget-cutting plan

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© The Associated Press / J. Scott Applewhite
House Budget Committee Chairman Rep. Paul Ryan, R-Wis., at podium, declares that he was 'disappointed' in President Obama's speech on a federal spending plan, Wednesday, April 13, 2011, during a news conference on Capitol Hill in Washington. From left are: House Ways and Means Committee Chairman Rep. Dave Camp, R-Mich., Ryan, Republican Conference Chairman Rep. Jeb Hensarling, R-Texas, and House Majority Leader Eric Cantor of Va.
The House and Senate are ready to vote on legislation cutting almost $40 billion from the budget for the current year, but President Barack Obama and his GOP rivals are both eager to move on to multiyear fiscal plans that cut trillions instead of billions.

Lawmakers were to vote Thursday on a long-overdue spending measure funding the day-to-day budgets of federal agencies through September. Later in the day, Republicans dominating the House will launch debate on a 2012-and-beyond plan that promises to cut the long-term budget blueprint Obama laid out in February by more than $6 trillion.

Obama countered Wednesday with a new call to increase taxes on wealthier people and impose quicker cuts to Medicare, launching a roiling debate in Congress and the 2012 presidential campaign to come.

Obama fired a broadside at the long-term GOP plan, which calls for transforming the Medicare health program for the aged into a voucher-like system for people under the age of 55 and imposing stringent cuts on Medicaid, which provides health care to the poor and disabled, including people in nursing homes.

More immediate, however, is the 2011 spending measure. It combines more than $38 billion in cuts to domestic accounts with changes to benefit programs, like children's health care, that Congress' own economists say are illusory.

Obama said Wednesday that spending cuts and higher taxes alike must be part of any deficit-reduction plan, including an end to Bush-era tax cuts for the wealthy. He proposed an unspecified "debt failsafe" that would go into effect if Congress did not make sure the national debt would be falling by 2014 relative to the size of the overall economy.

USA

US: Pentagon warns on big defense cuts

Robert Gates
© Reuters
U.S. Secretary of Defense Robert M. Gates walks out of the Pentagon for an honor cordon ceremony in Washington
The United States may have to scrap some military missions and trim troop levels if President Barack Obama sticks with his goal of saving $400 billion on security spending over a 10-year period, the Pentagon said on Wednesday.

Arms makers' shares sold off after Obama made a speech on the budget deficit in which he called, in effect, for holding growth in the Pentagon's core budget, excluding war costs, below inflation through 2023, starting in fiscal 2013.

The squeeze on the Pentagon's budget, which has roughly doubled since 2001, is part of a larger drive to cut the budget deficit by $4 trillion over the 10-year period.

Standard & Poor's aerospace and defense index declined 0.9 percent on Wednesday, underperforming the S & P 500 index, which closed up .02 percent. Lockheed Martin Corp, the Pentagon's No. 1 supplier by sales, dropped 2.6 percent to close at $80.37 on the New York Stock Exchange.

"It's not just a math exercise which is 'cut $400 billion'," said Geoff Morrell, the Pentagon press secretary. "It's 'let's review our roles and our missions and see what we can forgo, or pare down, in this age of fiscal constraint, where we are all collectively trying to work with the deficit problem.'"

Analysts said a selloff of arms makers' shares was an overreaction.