Tuesday, September 30, 2008

Mark-To-Market / It’s Time To Gore Sarbanes-Oxley Now

Former House Speaker Newt Gingrich is a senior fellow at the American Enterprise Institute (AEI). [Fox News interview YouTube video links at post end] Image Credit: episcopalifem.wordpress.com

Mark-To-Market / It’s Time To Gore Sarbanes-Oxley Now

In the wake of the ENRON Corporation accounting fiasco, congress rushed in with the passage of the Sarbanes-Oxley Act of 2002 to show that they were paying attention to the outrage seen in the voting public to lying from corporate executives.

Definition from Wikipedia:

The Sarbanes-Oxley Act of 2002 (Pub.L. 107-204, 116 Stat. 745, enacted 2002-07-30), also known as the Public Company Accounting Reform and Investor Protection Act of 2002, enacted on July 30, 2002 was put forward by Congress in response to a number of major corporate and accounting scandals including those affecting Enron, Tyco International, Adelphia, Peregrine Systems and WorldCom. Named after sponsors Senator Paul Sarbanes (D-MD) and Representative Michael G. Oxley (R-OH), the Act was approved by the House by a vote of 334-90 and by the Senate 99-0. President George W. Bush signed it into law, stating it included "the most far-reaching reforms of American business practices since the time of Franklin D. Roosevelt."

Tucked into this bill was an accounting practice that is known by the term “Mark-To-Market”. “Mark-To-Market” was designed to have assets of a corporation be valued on a market valuation basis. Simply put … the assets of a corporation would be valued not on the time and intrinsic value of the assets held, but on the confidence level of those assets as shown in the stock market price of the company marked at a particular point in time.

Several recognized leaders have begun to ask the Bush Administration to act against this practice and change it so that the value of corporate assets would be calculated based upon an average taken over a three month period backwards from the time the assessment is required when businesses are applying for swing loans upon which a company takes advantage of an opportunity to expand (leveraging assets).

Newt Gingrich, Donald Trump, and Steven Forbes are three of the recognized names calling for this free market change upon which about 70% of our economy’s liquidity crisis can be solved. By making the Executive Order TODAY to suspend the “Mark-To-Market” accounting practice of corporate valuation mandated by the Sarbanes-Oxley Act, corporations would be able to show assets valued at a more realistic rate thus banks would have the confidence to lend them money and our economy would gain some liquidity without taxpayer money.

This excerpted and edited from Forbes Magazine -

Suspend Mark-To-Market Now!

Newt Gingrich 09.29.08, 6:05 PM ET

Today, Congress voted against passing the bailout package for Wall Street. The stock market reacted immediately, falling almost 800 points. It is clear that something needs to be done, and in the coming days, a new package must be constructed that has the support of the American people that both deals with the liquidity crisis and sets the stage for long-term economic growth.
Today the Treasury secretary released the following statement: "I and my colleagues at the Fed and the SEC continue to address the market challenges we are facing on a daily basis. I am committed to continuing to work with my fellow regulators to use all the tools available to protect our financial system and our economy."

While Congress and the White House consider next steps, the Treasury and its fellow regulators should follow their own counsel and take without delay the one regulatory action within their discretion that can help immediately to calm markets and dramatically reduce the taxpayer risk in any necessary government intervention: suspend mark-to-market.

Chief economist Brian S. Wesbury and his colleague Bob Stein at First Trust Portfolios of Chicago estimate the impact of the "mark-to-market" accounting rule on the current crisis as follows:

"It is true that the root of this crisis is bad mortgage loans, but probably 70% of the real crisis that we face today is caused by mark-to-market accounting in an illiquid market. What's most fascinating is that the Treasury is selling its plan as a way to put a bottom in mortgage pool prices, tipping its hat to the problem of mark-to-market accounting without acknowledging it. It is a real shame that there is so little discussion of this reality." (Emphasis added.)
"Mark-to-Market" Accounting and the Origins of the Financial Crisis: Mark-to-market accounting (also known as "fair value" accounting) means that companies must value the assets on their balance sheets based on the latest market indicators of the price that those assets could be sold for immediately. Under such a rule, declining housing prices don't just reduce the value of defaulting mortgages. They reduce the value of all mortgages and all mortgage-related securities because the housing collateral protecting them is worth less.

Moreover, when a company in financial distress begins fire sales of its assets to raise capital to meet regulatory requirements, the market-bottom prices it sells out for become the new standard for the valuation of all similar securities held by other companies under mark-to-market. This has begun a downward death spiral for financial companies large and small.

More foreclosures and home auctions continue to depress housing prices, further reducing the value of all mortgage-related securities. As capital values decline, firms must scramble to maintain the capital required by regulation. When they try to sell assets to raise that capital, the market values of those assets are driven down further. Under mark-to-market, the company must then mark down the value of all of its assets even more.

The credit agencies see declining capital margins, so they downgrade the company's credit ratings. That makes borrowing to meet capital requirements more difficult. Declining capital and credit ratings cause the company's stock prices to decline.

Panic sets in, and no one wants to buy mortgage-related securities, which drives their value under mark-to-market regulations down toward zero. Balance sheets under mark-to-market suddenly start to show insolvency. This downward spiral shuts down lending to these companies, so they lose all liquidity (cash on hand) needed to keep company operations going. Stockholders--realizing that they will be wiped out if the companies go into bankruptcy or get taken over by the government--start panic selling, even when they know the underlying business of the company is fine.

The end result for the company is stock prices driven toward zero and bankruptcy or government takeover. The criminal liabilities imposed under Sarbanes-Oxley have driven accountants to stricter and stricter accounting evaluations and interpretations and have prevented leading executives from resisting them.
Reform or Bust: Because existing rules requiring mark-to-market accounting are causing such turmoil on Wall Street, mark-to-market accounting should be suspended immediately so as to relieve the stress on banks and corporations. In the interim, we can use the economic value approach based on a discounted cash flow analysis of anticipated-income streams, as we did for decades before the new mark-to-market began to take hold. We can take the time to evaluate mark-to-market all over again. Perhaps a three-year rolling average to determine mark-to-market prices would be a workable permanent system.
For companies like Bear Stearns, Lehman Brothers (nyse: LEH - news - people ) and American International Group (nyse: AIG - news - people ), suspending mark-to-market rules will come too late. But for the remaining vulnerable banks and corporations, doing away with the current mark-to-market accounting rules will safeguard against destructive pricing volatility, needless bankruptcies, job loss and huge taxpayer bailouts.

Suspending Mark-to-Market Only the First Step to Economic Recovery: In the wake of today's vote, suspending mark-to-market is an extremely important first step to take, but it is only a first step.
Congress should look at the impact of the Irish 12% corporate income tax on attracting investment and jobs to Ireland and consider a dramatic cut in the U.S. corporate income tax (the highest in the world when combined with state taxes) as a step toward attracting high-value productive and desirable jobs back to the United States.

The Congress should look at the Chinese and Singapore growth patterns and match them by zeroing out the capital gains tax to induce massive flows of private capital to rebuild the market and minimize the need for a taxpayer-funded bailout.

The Congress should repeal Sarbanes-Oxley, which failed to warn of every single bankruptcy but provides a $3-million-a-year accounting and regulatory expense for every small company wishing to go public.

This is the kind of pro-growth, pro-entrepreneur program that would accelerate the American recovery and lead to the next economic period of real growth.
Reference Here>>

It’s time to gore Sarbanes-Oxley now!

Newt Gingrich lays out the problem and the solutions to this liquidity crisis in three parts - in order HERE, HERE, and HERE.

Saturday, September 27, 2008

Just The Facts, Ma’am! – 2008 Debate #1

Image Credit: NPR

Just The Facts, Ma’am! – 2008 Debate #1

In this day and age of twenty-four hour, seven day a week communications, one would think that what politicians say while campaigning would be 100% accurate.

In the first time that the candidates from our two major political parties stood side-by-side, Senator’s Barack Obama and John McCain delivered answers in a debate format that allowed for responses beyond snippets from a typical stump speech. When answers to questions involve responses from a person’s memory, inaccuracies in the facts can … and will occur.

The Annenberg Public Policy Center of the University of Pennsylvania has a website designed specifically to sweep the floor and scrub down the answers from both gentleman to define the facts behind the statements these candidates make.

Image Credit: NPR

This excerpted and edited from Fact Check dot Org –

FactChecking Debate No. 1
Facts muddled in Mississippi McCain-Obama meeting
September 27, 2008 - University of Mississippi at Oxford


McCain and Obama contradicted each other repeatedly during their first debate, and each volunteered some factual misstatements as well.

The first of three scheduled debates between Republican Sen. John McCain and Democratic Sen. Barack Obama took place Sept. 26 on the campus of the University of Mississippi at Oxford. It was sponsored by the Commission on Presidential Debates. It was carried live on national television networks and was moderated by Jim Lehrer, executive editor and anchor of the PBS "NewsHour" program. We noted these factual misstatements:
Did Kissinger Back Obama?

McCain attacked Obama for his declaration that he would meet with leaders of Iran and other hostile nations "without preconditions." To do so with Iran, McCain said, "isn't just naive; it's dangerous." Obama countered by saying former Secretary of State Henry Kissinger – a McCain adviser – agreed with him:

Obama: Senator McCain mentioned Henry Kissinger, who's one of his advisers, who, along with five recent secretaries of state, just said that we should meet with Iran – guess what – without precondition. This is one of your own advisers.

McCain rejected Obama's claim:

McCain: By the way, my friend, Dr. Kissinger, who's been my friend for 35 years, would be interested to hear this conversation and Senator Obama's depiction of his -- of his positions on the issue. I've known him for 35 years.Obama: We will take a look.McCain: And I guarantee you he would not -- he would not say that presidential top level.Obama: Nobody's talking about that.
So who's right? Kissinger did in fact say a few days earlier at a forum of former secretaries of state that he favors very high-level talks with Iran – without conditions:

Kissinger Sept. 20: Well, I am in favor of negotiating with Iran. And one utility of negotiation is to put before Iran our vision of a Middle East, of a stable Middle East, and our notion on nuclear proliferation at a high enough level so that they have to study it. And, therefore, I actually have preferred doing it at the secretary of state level so that we -- we know we're dealing with authentic...CNN's Frank Sesno: Put at a very high level right out of the box?Kissinger: Initially, yes.But I do not believe that we can make conditions for the opening of negotiations.

Later, McCain's running mate, Sarah Palin, was asked about this by CBS News anchor Katie Couric, and Palin said, "I’ve never heard Henry Kissinger say, ‘Yeah, I’ll meet with these leaders without preconditions being met.'" Afterward Couric
said, "We confirmed Henry Kissinger’s position following our interview."After the McCain-Obama debate, however, Kissinger issued a statement saying he doesn't favor a presidential meeting:

Kissinger: Senator McCain is right. I would not recommend the next President of the United States engage in talks with Iran at the Presidential level. My views on this issue are entirely compatible with the views of my friend Senator John McCain.
Image Credit: NPR

Other responses handled in the above detailed manner are summarized as follows:

Obama denied voting for a bill that called for increased taxes on “people” making as little as $42,000 a year, as McCain accused him of doing. McCain was right, though only for single taxpayers. A married couple would have had to make $83,000 to be affected by the vote, and anyway no such increase is in Obama’s tax plan.

McCain and Obama contradicted each other on what Joint Chiefs of Staff Chairman Admiral Mike Mullen said about troop withdrawals. Mullen said a time line for withdrawal could be “very dangerous” but was not talking specifically about “Obama’s plan,” as McCain maintained.

McCain tripped up on one of his signature issues – special appropriation “earmarks.” He said they had “tripled in the last five years,” when in fact they have decreased sharply.

Obama claimed Iraq “has” a $79 billion surplus. It once was projected to be as high as that. It’s now down to less than $60 billion.

McCain repeated his overstated claim that the U.S. pays $700 billion a year for oil to hostile nations. Imports are running at about $536 billion this year, and a third of it comes from Canada, Mexico and the U.K.

Obama said 95 percent of “the American people” would see a tax cut under his proposal. The actual figure is 81 percent of households.

Obama mischaracterized an aspect of McCain’s health care plan, saying “employers” would be taxed on the value of health benefits provided to workers. Employers wouldn’t, but the workers would. McCain also would grant workers up to a $5,000 tax credit per family to cover health insurance.
Reference Here>>

Friday, September 26, 2008

Of Howdy-Doody and WAMU

Now children of all ages can join Howdy, Buffalo Bob, Clarabelle and the lovable Doodyville characters in a good family atmosphere, the way it used to be. You will agree ... GREAT CHILDREN'S PROGRAMMING IS ETERNAL. You and your family will love that old fashioned feeling of fun and love that Howdy Doody will bring into your home. Image Credit: Doodyville

Of Howdy-Doody and WAMU

Just WHO does late night television entertainer and talkshow host David Letterman think he is … after all, he is just the Howdy Doody of the evening television airwaves who helps most people promote books, movies, and events as we all try to get some sleep at the end of a long day.

This week, Senator John McCain, the Republican Party nominee running to be the next President of the United States and leader of the free world decided to suspend his activities campaigning so that he could direct his attention on his duties as a senior Senator and presumptive head of the Republican Party on the pending liquidity crisis looming over the housing mortgage industry.

This excerpted and edited from the Associated Press –

Letterman unloads on McCain for not showing up

NEW YORK (AP) - September 25, 2008

"Late Show" host David Letterman treated John McCain's decision to cancel an appearance on his talk show more like a stupid human trick than the act of a statesman.
"This doesn't smell right," Letterman said. "This is not the way a tested hero behaves. Somebody's putting something in his Metamucil."

McCain spokeswoman Nicole Wallace said Thursday that the campaign "felt this wasn't a night for comedy."

"We deeply regret offending Mr. Letterman, but our candidate's priority at this moment is to focus on this crisis," Wallace said on NBC's "Today" show.
Letterman later asked: "Are we suspending it because there's an economic crisis or because the poll numbers are sliding?"
McCain told the CBS show that he was immediately flying back to Washington, Letterman told his audience. Then Letterman showed a TV feed of McCain being made-up for an appearance on news anchor Katie Couric's "CBS Evening News."

"Doesn't seem to be racing to the airport, does he?" Letterman said. "This just gets uglier and uglier."

As McCain spoke to Couric, Letterman shouted at the feed: "Hey, John, I've got a question. Do you need a ride to the airport?"

Letterman later said: "We're told now that the senator has concluded his interview with Katie Couric and he's now on Rachael Ray's show making veal piccata. ... What are you going to do?"
Reference Here>>

Last night, we were greeted with the news that Washington Mutual (WAMU), one of the largest banks that participated in the Fannie Mae/Freddie Mac social engineering concept which got its start in 1995 during the Clinton administration, FAILED.

President Bill Clinton wanted to try and achieve a potential 70% home ownership by the citizens of our country. He felt that in order to allow people who could not come up with the standard 20% down payment - which was the custom - the federal government could stand behind a looser, eaiser set of qualifying rules with its money (taxpayer money … read that OUR money) and help more people into home ownership.

WAMU commercial where a potential customer shouts "Whoo hoo!" as she imagines herself blistering along in a dragster on the Bonneville saltflats in an illustration as to how fast one could set up an account. Presumably, this also what happened when people applied for a home loan ... the real parachute to slow the dragster down came from JP Morgan. (Ctrl-Click to see video) Image Credit: AdFreakyFan

This Excerpted and edited from the Guardian (UK) –

America's largest banking failure sees JP Morgan pick up Washington Mutual

Julia Kollewe, guardian.co.uk, Friday September 26 2008 11:23 BST

The escalating crisis in the global financial system has claimed its biggest victim yet with the collapse last night of the US savings and loan group, Washington Mutual.

In America's largest-ever banking failure, Federal regulators seized the group's assets in the early hours of this morning and sold them to JP Morgan Chase for $1.9bn (£1.03bn).

Founded in Seattle in 1889 and known as WaMu, the group is the nation's biggest savings and loans company - the US equivalent to a British building society. The deal will make JP Morgan the largest bank in the US, ahead of Bank of America.
The face of the global financial industry has changed dramatically in the past fortnight. The US government has taken over mortgage finance giants Fannie Mac and Freddie Mac and bailed out the insurer American International Group for $85bn. Lehman Brothers filed for bankruptcy, and Merrill Lynch has been sold to Bank of America. In Britain, Lloyds TSB has agreed the takeover of the troubled mortgage lender HBOS.
The move came as the Bush administration's $700bn bailout plan for the financial sector ran into trouble. The package could have helped WaMu, but regulators decided that waiting any longer "was not a responsible decision to make," Bair said.
WaMu has seen its share price virtually wiped out after it made thousands of mortgage loans that its borrowers cannot repay, saddling it with billions of dollars in bad debts. The company has posted losses for the last three quarters, including a loss of $3.3bn for the most recent quarter, ending in June. It put itself up for sale last week but could not attract any bidders.
JP Morgan's chief executive Jamie Dimon said he was undeterred by WaMu's financial problems. "We're getting franchises of this company for a long period of time," he said. The bank will gain long-desired presence on the west Coast as WaMu's branches are concentrated in California.

In March, WaMu rejected an offer of $8 a share from JP Morgan. The company's then-chief executive was subsequently fired.
Reference Here>>

To make a long story short … WAMU, as many other banks had done, granted loans on houses with little or no collateral by people who had no ability or intention to pay and were now left being responsible for assets that were worth at least 40% less value than they had used to secure additional operating capital. Hence, the liquidity (money) dried up and the operations had to be sold to another organization … the bank FAILED to continue operations.

What John McCain did was to stop the endless promotion of his run for the highest office in the land so that he could do his job as Senator to help negotiate and focus on the interest of taxpayers.

What Howdy Doody-David Letterman did was to whine and throw a hissy fit because John McCain canceled a campaign stop-over to appear on Mr. Doody’s neighborhood due to the fact he really had better, more important things to do.

With his efforts to forge an agreement between both political parties … and to protect taxpayer interests, maybe a few less banks will succumb to the lack of cash in the housing and mortgage banking system which has its additional ripple effects on business in general.

Maybe Howdy Doody should just go to his corner of the peanut gallery and shut his pie hole on the subject … Barack (present!) Obama may not be ready for primetime but John McCain, in this time of our country’s leadership activity, does not need to be taking any “Howdy Doody Time.”

We, at MAXINE, graduated from watching “Howdy Doody Time” a long time ago – Whoo hoo!

Wednesday, September 17, 2008

Virgin Overload In Yemen

Image Credit: Telegraph (UK)

Virgin Overload In Yemen

Today, we were all met with the news that the United States Embassy in Yemen was attacked with a bomb blast. Sixteen total victims were taken out by the blast … six of the sixteen victims were the terrorist themselves.

A half a dozen members of the Islamic Jihad in Yemen terrorist group wore police uniforms to try to get through the embassy's perimeter security during a morning shift change.

The embassy itself was not damaged because the bomb went off some distance away at a perimeter checkpoint.

Image Credit: Telegraph (UK)

So, at 72 “Virgins” per terrorist, the pay-off for these fools ends up being 432 rewards for accomplishing little else than killing ten innocent people.

One wishes, sometimes, that these folks would short circuit the process and just find a van, fill it with six members of the Islamic Jihad in Yemen (or any other random Islamic Jihadist group), drive it out into the desert, and blow it up there.

The ending of terrorist lives, so that they could reach their reward, would be carried out in a cheaper by the half-dozen process, and no one else would have to suffer … that is except the 432 Virgins that are supposed to greet these people!

This excerpted and edited from the Telegraph -

US embassy blast: 10 die in car bomb attack in Yemen
Islamist militants attacked the heavily-guarded US embassy in Yemen with a car bomb and rockets, killing at least ten people.
By Tim Butcher, Middle East Correspondent - Last Updated: 12:54PM BST 17 Sep 2008

The car exploded some distance from the embassy in Sanaa, the Yemeni capital, at a checkpoint manned by security personnel, before gunmen in another car started firing.
Four civilians and six members of the police died in the attack, a spokesman for the Yemeni security forces said. The six attackers - one wearing an explosives belt, also died. There were no casualties among US diplomatic staff.

Trevor Mason, a British eye-witness who lives in an apartment block close to the US embassy compound, said the attack began around 8.30 am local time.

"We heard the sounds of a heavy gun battle going on,'' he said.

"I looked out my window, and we saw the first explosion going off -- a massive fireball very close to the US embassy.

"The gun battle went on for a further 10 to 15 minutes, followed by two further loud explosions.
Three days ago it issued a warning it was preparing to attack targets in Yemen including the British and US embassies.

The Yemeni regime's close links to the West - allowing US soldiers to train its security forces - has prompted numerous recriminatory attacks from the militant groups that enjoy strong support from the country's deeply conservative, tribal population.

Osama bin Laden was born in Saudi Arabia, but his father was born in Yemen and the bin Laden clan still has deep roots in the country's arid, lawless hinterland.

The British embassy was attacked with grenades so many times in the 1990s it was moved to a more secure location on a hillside overlooking Sanaa after the 2003 invasion of Iraq.
Reference Here>>

Sunday, September 14, 2008

CBS’s Fall Movie Preview Slants Largely Left

THE MOVIES: Fall Movies - The fall film season is upon us, the time that many moviegoers eagerly anticipate, when the studios release many of their best films, films they think may be contenders come Oscar time. With Los Angeles Times Film Critic Kenneth Turan as our guide, we look at some of the new films coming soon to a multiplex near you. Image Credit: Saatchi & Saatchi

CBS’s Fall Movie Preview Slants Largely Left

We, at MAXINE, were watching CBS Sunday Morning at about 7:37 AM PT and a review of the new fall films was put together and played with what seemed to be an obvious perspective slant.

We do know it is not just us, people have complained over, and over again that when Hollywood produces a film about military conflicts and/or current political situations, only one side of complex issues is portrayed. That one side, or point of view, is almost always from the political American Left/Progressive/Socialist/Group Rights to the rejection of traditionally American Right/Conservative/Self-Reliant/Individual Rights based perspective.

Therein lays our observation, and it has to do with the knowledge of one film that was blatantly omitted from the presentation.

"American Carol" is being advertised as unabashedly based in making fun of the political Left in our country through a tale told about a mythical situation that centers around Michael Moore.

Moore, who we are familiar with from movies titled Bowling For Columbine, Fahrenheit 911, SICKO, is a filmmaker who uses a documentarian style to illustrate a point of view he holds about any subject he chooses to highlight. The biggest problem with Michael Moore’s style of filmmaking is that it really isn’t either a documentary, or an issue exploring political tome themed film … it bases itself somewhere in the middle, ending up in the end with just his point of view … which is politically American Left/Progressive/Socialist/Group Rights.

"American Carol" punches large holes of situation-comedy into circumstances the film character of Michael Moore finds himself involved in … through parody from the politically American Right/Conservative/Self-Reliant/Individual Rights based perspective.

CBS Sunday Morning, in it’s presentation, highlighted three of the fall season’s politically themed movies and showed clips of the films, all of which were from an overtly critical viewpoint that stands clearly on the Left. Oliver Stone’s “W.” about a pre-presidential George Bush, "Frost/Nixon" which gives a focus on the interviews that British interviewer, David Frost did with the disgraced President Nixon after he resigned President, and Sean Penn in “Milk” showing Harvey Milk’s life and struggle as a gay rights activist before he was assassinated by one of his fellow city councilmen.

Out of the 23 films previewed (however briefly), why wasn't there room for a movie from a different point of view than these three obviously are?

How about removing any of these other culturally questionable movies while they are at it … and make room for a political comedy from the other side?

Kenneth Turan - The red carpet may be rolled up and every starlet in town may be wearily kicking off her Manolos, but the premiere isn’t really over until Los Angeles Times film critic Kenneth Turan serves judgment with breakfast. Even the most mindless summer blockbuster is treated to an inspired, intellectually discerning review by Turan, also a regular commentator for NPR’s “Morning Edition.” … well, duhhhhhh! Image Credit: MovieMaker

This Excerpted and edited from CBS –

The Fall Movies Are Coming
And ... Action! Critic Kenneth Turan Previews Hollywood's Oscar Bait And Box Office Hopefuls

CBS - Sept. 14, 2008

The new movie season has arrived. We'll be bringing you a variety of coming attractions in weeks ahead. To begin, Jerry Bowen with a look at fall movies...

Big names … epic sagas … even a tall tale or two. If you really love the movies, then this is your time of year.

The very best time of year, says Los Angeles Times film critic Kenneth Turan:

"You have to be optimistic in the fall," Turan said. "The fall is the season when the studios put all their quality eggs into that basket. So, if you're not optimistic in the fall, you're gonna have a terrible time the rest of the year!"

If its spy craft you crave, there's "Body of Lies," with Leonardo DiCaprio and Russell Crowe from director Ridley Scott.

"He's really turned into one of the great craftsmen, I think, of modern movies," Turan said. "He always does something interesting."
"Titanic" stars DiCaprio and Kate Winslet reunite in "Revolutionary Road," suffering together in suburbia.
And what of this pair? Oscar-winners Meryl Streep and Phillip Seymour Hoffman are nun and priest in the film "Doubt" about accusations of clergy sexual abuse.

"I'm really looking forward to seeing how they interact with each other," Turan said. "These are two of our best actors, with really strong material. It could really ignite."
In a year when the longest-running and most riveting political drama has been the still-evolving presidential campaign, it seems appropriate to have a choice of political dramas at the box office, a trio of films to remind us that truth … or what passes for truth … is always stranger than fiction.

Director Oliver Stone bids farewell to President Bush with "W," Stone's version of how the 43rd president made it into office. Josh Brolin stars.

"You know, this could be anything," Turan said. "It certainly won't be boring. That's the one thing you'll say: 'I don't think it's gonna bore anybody.'"

"Frost/Nixon" is based on the real televised interviews David Frost conducted with the disgraced ex-president.

And Sean Penn stars in "Milk," the story of gay politician Harvey Milk who was murdered by a fellow San Francisco supervisor, a performance with Oscar buzz.

"The strength of the film is gonna be in the performances, and especially Sean Penn's," said Turan. "And whenever he gets really into a part, you want to watch."
World War II is back in a big way. Daniel Craig leads the Jewish underground against German troops in "Defiance."

"Miracle at St. Anna" is director Spike Lee's story of African American soldiers caught behind the lines in Italy.

And in the epic "Australia," Nicole Kidman and Hugh Jackman fall in love as war with the Japanese looms.

In an odd way, says critic Turan, Americans find comfort in WWII movies:

"We are in such a quandary now about our place in the world. And I think we have a real nostalgia for the days when it was crystal-clear who the good guys were, the bad guys were, what we should be doing. And also, when we clearly won."
So if it's movies you like … this is your time of year.
Reference Here>>

Turan observes that in an odd way we all find comfort from WWII movies – then he goes on to impugn the history we have all lived through here in the War On Terror.

Hey Kenneth (from the LA Times), haven’t you noticed that our country has not had a follow-on attack to the Islamic Terrorist attacks on September 11, 2001? That the surge of troops in Iraq has worked to turn the security quotient of this brand new democratic country (three nationwide votes with over 70% participation of 25 million citizens) which includes the recent turnover of one of the formally most violent provinces back to security Iraqi authorities?

What!? There is nothing to dramatize here that would allow Americans to take comfort and know that we do know our place in the world?

If it is largely slanted reporting you want … this (CBS) is only one of about six network channel offerings out of seven available on broadcast and cable/satellite to ones television set.

Thanks for the constant reminder, CBS and Kenneth Turan, to all of us here at MAXINE.

Thursday, September 11, 2008

9-11 Tribute: The Price Of Freedom

An Iraq Veteran (Joe Cook) has a personal message for Barack Obama.
(Ctrl-Click to launch YouTube video)

Here at Carter's Second Term, we believe this is the best way to recognize this anniversary of the day Islamic terrorist, in an attempt to reduce the freedoms we enjoy in this country, hijacked passenger jet airplanes, full of innocent people intending on getting to their destination city, and intentionally flew them into the two World Trade Center buildings, the Pentagon, and into the ground in an open field in Pennsylvania (one intended for the White House in Washington D.C. but foiled and retaken by passengers).

Over 3,000 innocent souls were taken that day and our effort to right the wrongs that were created by this act perpetrated on September 11, 2001 are embodied in this video about the price of freedom by Iraqi theater veteran Joe Cook.

Tuesday, September 09, 2008

Post Palin Prognosis For Political Pop-Star Barack Obama

The presidential race, recently, seems to be all about Alaska Governor Sarah Palin -- but how long this period lasts depends in part on how Barack Obama confronts a phenomenon that can only be described as Obama-like. Image Credit: Associated Press

Post Palin Prognosis For Political Pop-Star Barack Obama

It’s only been a little over a week and a half since the announcement of the running mate for the Republican Party Presidential ticket and about one week since she was able to introduce herself to those who are engaged deeply in our democratic political process.

The impact this is having and the increase in enthusiasm it has generated in having an executive branch headed by Senator John McCain is completely unexpected. Crowds that greeted John McCain and Alaska Governor Sara Palin were almost ten times the size expected for each of the last four stump speech gatherings. The largest gathering was held in a hanger in Colorado Springs, Colorado with a crowd estimated at approaching 20,000 people (only 1,500 were scheduled to arrive).

For Republicans, who have felt that their agenda was going to be diluted by a “maverick” choice of a known friend of Mr. McCain’s were caught off guard when John picked a maverick and proven governmental reformist in Sarah.

While this pick and her acceptance is a good thing for Republicans, the swing in the polls can not be fully explained through one strong choice for Vice-President.

Barack Obama has a large and detailed part to play in the near 20 percentage point swing over the last couple of weeks in some key demographics. With just under sixty day left in a campaign season that has already lasted, well, for Democrats, almost eight years ... the Republicans may be on the verge of winning it all.

"We need to carry Colorado. We need to win!" he told a roaring crowd that spilled out of a hangar at the Colorado Jet Center, on the west side of the Colorado Springs Airport. /// The Colorado Springs Police Department declined to provide an estimate of the crowd size, but a campaign spokesman, Tom Kise, said 13,000 had gone through security checks. Image Credit: Rocky Mountain News

This excerpted and edited from Asia Times -

How Obama lost the election
By Spengler, Asia Times - Sep 3, 2008

DENVER - Senator Barack Obama's acceptance speech last week seemed vastly different from the stands of this city's Invesco Stadium than it did to the 40 million who saw it on television. Melancholy hung like thick smog over the reserved seats where I sat with Democratic Party staffers. The crowd, of course, cheered mechanically at the tag lines, flourished placards, and even rose for the obligatory wave around the stadium. But its mood was sour. The air carried the acrid smell of defeat, and the crowd took shallow breaths. Even the appearance of R&B great Stevie Wonder failed to get the blood pumping.

The speech itself dragged on for three-quarters of an hour. As David S Broder wrote in the Washington Post:

"[Obama's] recital of a long list of domestic promises could have been delivered by any Democratic nominee from Walter Mondale to John Kerry. There was no theme music to the speech and really no phrase or sentence that is likely to linger in the memory of any listener. The thing I never expected did in fact occur: Al Gore, the famously wooden former vice president, gave a more lively and convincing speech than Obama did."

On television, Obama's spectacle might have looked like The Ten Commandments, but inside the stadium it felt like Night of the Living Dead.
The Democrats were watching the brightest and most articulate presidential candidate they have fielded since John F Kennedy snatch defeat from the jaws of victory. And this was before John McCain, in a maneuver worthy of Admiral Chester Nimitz at the Battle of Midway, turned tables on the Democrats' strategy with the choice of Alaska governor Sarah Palin as his running mate.
Obama will spend the rest of his life wondering why he rejected the obvious road to victory, that is, choosing Hillary Clinton as his vice presidential nominee.
McCain's choice of vice presidential candidate made obvious after the fact what the party professionals felt in their fingertips at the stadium extravaganza yesterday: rejecting Clinton in favor of the colorless, unpopular, tangle-tongued Washington perennial Joe Biden was a statement of weakness. McCain's selection was a statement of strength. America's voters will forgive many things in a politician, including sexual misconduct, but they will not forgive weakness.

That is why McCain will win in November, and by a landslide, barring some unforeseen event. Obama is the most talented and persuasive politician of his generation, the intellectual superior of all his competitors, but a fatally insecure personality. American voters are not intellectual, but they are shrewd, like animals. They can smell insecurity, and the convention stank of it.
Biden, who won 3% of the popular vote in the Democratic presidential primary in his home state of Delaware, and 1% or less in every other contest he entered, is ballot-box poison. Obama evidently chose him to assuage critics who point to his lack of foreign policy credentials. That was a deadly error, for by appearing to concede the critics' claim that he knows little about foreign policy, Obama raised questions about whether he is qualified to be president in the first place.
Why didn't Obama choose Hillary? The most credible explanation came from veteran columnist Robert Novak May 10, who reports that Michelle Obama vetoed Hillary's candidacy. "The Democratic front-runner's wife did not comment on other rival candidates for the party's nomination, but she has been sniping at Clinton since last summer. According to Obama sources, those public utterances do not reveal the extent of her hostility," Novak wrote. If that is true, then Obama succumbed to the character weakness I described in a February 26 profile of (Obama's women reveal his secret). His peculiar dependency on an assertive and often rancorous spouse, I argued, made him vulnerable, and predicted that Obama "will destroy himself before he destroys the country".
Given Obama's defensive, even wimpy selection of a running-mate, McCain's choice was obvious. He picked the available candidate most like himself: a maverick with impeccable reform credentials, a risk-seeking commercial fisherwoman and huntress married to a marathon snowmobile racer who carries a steelworkers union card. The Democratic order of battle was to tie McCain to the Bush administration and attack McCain by attacking Bush. With Palin on the ticket, McCain has re-emerged as the maverick he really is.
The young Alaskan governor, to be sure, hasn't any business running for vice president of the United States with her thin resume. McCain and his people know this perfectly well, and that is precisely why they put her on the ticket. If Palin is unqualified to be vice president, all the less so is Obama qualified to be president.
Obama, who styled himself an agent of change, took his image for granted, and attempted to ensure himself victory by doing the cautious thing. He is trapped in a losing position, and there is nothing he can do to get out of it.

Obama, in short, is long on brains and short on guts.
Obama could have allied with the old guard, through an Obama-Clinton ticket, or he could have rejected the old guard by choosing the closest thing the Democrats had to a Sarah Palin. But fear paralyzed him, and he did neither.

In my February 26 profile, I called Obama "the political equivalent of a sociopath", without any derogatory intent.
No country's politics depends more openly on friendships than America's, yet Obama has not a single real friend, for he rose so fast that all his acquaintances become rungs on the ladder of his ascent. One human relationship crowds the others out of his life, his marriage to Michelle, a strong, assertive and very angry woman.

If Novak's report is accurate, then Michelle's anger will have lost the election for Obama, as Achilles' anger nearly killed the Greek cause in the Trojan War. But the responsibility rests not with Michelle, but with Obama. Obama's failure of nerve at the cusp of his success is consistent with my profile of the candidate, in which I predicted that he would self-destruct. It's happening faster than I expected. As I wrote last February:

It is conceivable that Barack Obama, if elected, will destroy himself before he destroys the country. Hatred is a toxic diet even for someone with as strong a stomach as Obama ... Both Obama and the American public should be very careful of what they wish for. As the horrible example of Obama's father shows, there is nothing worse for an embittered outsider manipulating the system from within than to achieve his goals.
By all rights, the Democrats should win this election.

They will lose, I predict, because of the flawed character of their candidate.
Reference Here>>

This afternoon, Barack Obama gave a hint into his flawed character when he decided to obliquely refer to the Governor from the state of Alaska Sarah Palin at one of his increasingly, lightly attended hand-picked town hall style media events, as a pig.


Monday, September 08, 2008

Obama - No Conflicts? … So, No Military … “that’s the ticket”

Barack Obama struggling to answer a question that was asked by a viewer (who wrote in) of ABC News, 'This Week' on the Sunday interview show (Ctrl-Click to launch video). Image Credit: ABC News website

Obama - No Conflicts? … So, No Military … “that’s the ticket”

The neat thing about listening to Barack Obama speak when he is off-prompter (where a speech is written out for him to read directly from an image projected on to a reflective glass surface), is that it is really easy to tell when he is unprepared to respond to a particular issue or question that is asked – just listen.

He, the junior Senator from Illinois, is usually very smooth in his speaking style – clear, succinct, and directly to the point – especially on subjects he is well versed on and/or he is reading from a Teleprompter. When Barack has to answer a question he hasn’t thought about … and has to come up with an answer that he thinks will “sell” his “everyman” image, he puts a lot of unnecessary I’s, and’s, and ah’s which usually NEVER make it into a transcript of the answer that he gives.

On the Sunday political interview program aired on ABC-TV, ‘This Week’ with George Stephanopoulos, a question came up that illustrates the point quite clearly. The answer is so labored that it almost causes one to think back on the comedy sketch routinely played by Jon Lovitz where he floats an obvious bogus answer to a question posed --- and then mutters to himself, “Ahhh, that’s the ticket!”

This found at ABC News -

Obama’s Full ‘This Week’ Interview
Presidential hopeful chats with George Stephanopoulos in an exclusive interview.


Watch FULL Video Here>>
-01:25 from the end

George Stephanopoulos asks, “One of our viewers wrote in, you talk about “Service”, and asks - Brenda Gottfried Bryant - Murietta, Georgia, “Did you ever consider joining our armed services to protect and serve our country, and if not, why?”

“You know, I actually did,” Obama said. “I had to sign up for Selective Service when I graduated from high school. And I was growing up in Hawaii. And I had - (ah) - friends who, whose parents were in the military. There are a lot of Army, (ah) military bases there.

“And (ah) I actually always thought (ah) of the military as (ah) some ennobling (ah) and, and, you know, honorable option. But keep in mind that I (ah) graduated in 1979. (ah) The Vietnam War had come to an end. (ah) We weren't engaged (ah) in an active (ah) (ah) military conflict at that point. (ah) And so, it's not an option that I ever decided to pursue.”

Barack Obama continues to answer on talking points that he has previously thought about and he resumes a smoother delivery in his answer.

We, at MAXINE, wish we could get a dollar for every (ah) that Barack Obama utters on answers to questions that are genuinely out of the socialist/progressive character template that Obama holds.

Just on this last exchange alone, we would get enough money ($13.00) to catch a fish taco lunch at the local Islands café, and have enough left over for a couple of beers!

Add the unecessary "And's" that mostly begin the sentences ($5.00), and one could invite a friend.

Ahhhh, that's the ticket!

Wednesday, September 03, 2008

Obama's Ethereal Experience Vs. Palin's Reality Of Accomplishment

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Obama's Ethereal Experience Vs. Palin's Reality Of Accomplishment

This election cycle for President of the United States is really fun and is beginning to feel like a ride in a “Bumble Ball” (if riding in a Bumble Ball were possible).

Take the recent media reaction to Senator John McCain’s pick for Vice-President of Alaska Governor Sarah Palin – WOW.

All of the pundits on radio and television (especially cable news television) seem to be making arguments for or against the wisdom of any potential candidacy based upon past “Experience” while the real measure of anyone’s experience actually lies in the value of their “Accomplishment”.

Even Barack Obama doesn’t get it … when confronted with Sarah Palin’s years of experience in chief executive decision making office positions (on the city council as Mayor of a city and then as Governor of the State of Alaska) he sites as a comparison his function as the leader of the Barack Obama campaign for President of the United States.

This excerpted from CNN and the Anderson Cooper 360 show –

Anderson Cooper interviewed Barack Obama Monday

From CNN Political Producer Ed Hornick - September 1, 2008 - Posted: 07:10 PM ET

Barack Obama defended his experience in dealing with natural disasters, such as Hurricane Katrina, and took a swipe at newly minted GOP vice presidential candidate Sarah Palin.

In an interview on CNN's Anderson Cooper 360 Monday night, Obama was asked about whether his experience in the U.S. Senate dealing with weather-related situations compares to Palin’s executive experience running the state of Alaska and as the small town mayor of Wasilla, Alaska.

(YouTube type video of AC360 interview of Barack Obama by Anderson Cooper - Ctrl-Click photo to launch)

“My understanding is that Gov. Palin’s town, Wassilla, has I think 50 employees. We've got 2500 in this campaign. I think their budget is maybe 12 million dollars a year – we have a budget of about three times that just for the month,” Obama responded.

Our ability to manage large systems and to execute I think has been made clear over the past couple of years and certainly in terms of the legislation I’ve passed in the past couple of years, post-Katrina.”

Reference Here>>

What is truly striking about the response and position that Barack Obama stakes out in his response to Anderson Cooper’s query is the depth of the ignorance that he has about the value of accomplishment in decision making a city manager and/or Mayor has in the lives of the people who actually live in a city or town … let alone a State – ANY State.

Banner graphic from the city of Wasilla website

Let’s examine for a minute the online Budget for 2005 published by and for the city of Wasilla, Alaska (Wasilla – for the Sarmatian god of the same name, see Wasilla (god)) – the city that Sarah Palin served for a period of two terms on the Wasilla, Alaska, city council from 1992 to 1996, then won two terms as mayor of Wasilla from 1996 to 2002.

The city hall of Wasilla ... the one that pundit James Carville describes as looking like a "bait shop" in Louisiana. Image Credit: City of Wasilla website

It is not the amount of money that is managed, it is the 256 pages of description, on where the money comes from and how it is used to the betterment of the community this organization is formed to serve, that concerns itself with the issue of accomplishment.

So, where does the money come from and what community does the campaign for President of the United States does the Barack Obama for President organization serve?

Is there any infrastructure upon which people are able to fly an airplane, drive to the city for goods and services, get help in an accident, report a crime, prosecute a criminal, get married, get an education, and have the trash picked up long after decisions are made on how to use the municipalities collected tax money?

A political campaign organization asks for money to be donated so it can be spent on activities promoting the candidate, Barack Obama, himself.

The money is spent on cardboard signs, printed paper with gum/glue on the back so that the paper could be affixed to a car or telephone pole, video production services so that YouTube and Television ads can be made and promotional time can be bought to play them, leased jet airplanes so that the candidate and his staff can be flown anywhere/anytime foe events where the candidate can be heard and seen by people at a gathering … and more.

All of the investment of donated money and the effort it pays for is designed so that the candidate, Barack Obama, can put himself in a place where he can make decisions for the betterment of the community he wants to serve – a place he has never been before as a community organizer in Chicago, a senator in the state government of Illinois, and finally as the junior Senator for the state of Illinois in the United States Senate.

Sarah Palin has been in a place where her decisions resulted into accomplishment for the better part of 10 years in a city community environment and for the state community for two and a half years as she chaired the Alaska Oil and Gas Conservation Commission from 2003 to 2004 while also serving as Ethics Supervisor of the commission, and as the governor of Alaska, becoming the first woman and youngest person to hold the office.

Barack Obama really does not know what he doesn’t know and to prove this fact here are a couple of facts about the state of Alaska that Barack Obama would not and could not compare his political campaign to.

Alaska is a fairly large state economically, for example; the state ranks as #6 in Gross Domestic Product Per Capita on the list of all 50 states (behind Delaware, Connecticut, New York, Massachusetts, New Jersey, and ahead of California in #7 – Illinois by comparison ranks #17)

This excerpted from Wikipedia (pretty easy to find) –

Shortly after becoming governor, Palin canceled a contract for the construction of an 11-mile (18 km) gravel road outside Juneau to a mine. This reversed a decision made in the closing days of the Murkowski administration.[70] She also followed through on a campaign promise to sell the Westwind II jet purchased (on a state government credit account, against the wishes of the Legislature) by the Murkowski administration for $2.7 million in 2005. In August 2007, the jet was sold on eBay for $2.1 million.[71]

In June 2007, Palin signed into law a $6.6 billion operating budget—the largest in Alaska's history.
[72] At the same time, she used her veto power to make the second-largest cuts of the construction budget in state history. The $237 million in cuts represented over 300 local projects, and reduced the construction budget to nearly $1.6 billion.[73]

In 2007, the Alaska Creamery Board recommended closing Matanuska Maid Dairy, an unprofitable state-owned business. Palin objected, citing concern for dairy farmers and a recent infusion of $600,000 in state money. Palin subsequently replaced the entire membership of the Board of Agriculture and Conservation.
[74] The new board reversed the decision to close the dairy. Later in 2007, the unprofitable business was put up for sale. No offers met the minimum bid of $3.35 million,[75][76] and the dairy was closed. In August 2008, the Anchorage plant was purchased for $1.5 million, the new minimum bid. The purchaser plans to convert it into heated storage units.[77]
Reference Here>>

So again, let’s look at the off-the-cuff comment and comparison by Barack Obama while he was interviewed by Anderson Cooper on CNN –

“My understanding is that Gov. Palin’s town, Wassilla, has I think 50 employees. We've got 2500 in this campaign. I think their budget is maybe 12 million dollars a year – we have a budget of about three times that just for the month,” Obama responded.

As Governor of Alaska for the last year, Sarah Palin ran the going concern that operated on an approved budget of 6.6 billion dollars, was the commander-and-chief Alaska’s National Guard, is aware on a daily basis the politics of Russia and Canada where the State of Alaska shares a border with both countries and the state and municipal government employ a total of 8,500 people to carry out the people’s business.

It is an insult to begin to compare the ethereal nature of experience to the reality of accomplishment an executive position in government begets.

What is even more odd is that the junior Senator from Illinois, who is running for the top executive governmental position in the United States, takes the time to compare himself in background and experience with the competitive choice for the back-up position for the same top executive governmental position.

I guess Sarah Palin said it best in her speech at the RNC Convention in St. Paul, MN when described what the job of a small town mayor was like --- "Before I became governor of the great state of Alaska, I was mayor of my hometown.

And since our opponents in this presidential election seem to look down on that experience, let me explain to them what the job involves.

I guess a small-town mayor is sort of like a "community organizer," except that you have actual responsibilities.

I might add that in small towns, we don't quite know what to make of a candidate who lavishes praise on working people when they are listening, and then talks about how bitterly they cling to their religion and guns when those people aren't listening.

We tend to prefer candidates who don't talk about us one way in Scranton and another way in San Francisco."

The person at the top of the ticket choose right for the good of the country and with the choice of Sara Palin as his running mate, John McCain had this to say in his speech that closed the RNC Convention:

"Let me offer an advance warning to the old, big spending, do nothing, me first, country second Washington crowd: change is coming."

The Democrats are scared folks; they are scared that Barack Obama’s and Joe Biden's “experience” does not stack up to Senator John McCain’s and Governor Sarah Palin’s accomplishments and with good reason.

Monday, September 01, 2008

The New Soviet Russia - Five Principles!

Russian President Dmitry Medvedev lays out the five principles. Image Credit: Image Credit: Voices From Russia - Barbara-Marie Drezhlo (“Vara”)

The New Soviet Russia - Five Principles!

This new position of Russia shows its adherence to the SOVIET principals that made the governance of this country … as President Ronald Reagan put it – “The Evil Empire”.

What the new leadership is trying to do is to re-establish its dominance in the region, strengthen its strategic access to energy and build its military so that it can realize its agenda through force.

The beauty of the positioning is that it will be able to pursue its objectives without a cost of its standing in the world community.

The first evidence of this is its takeover of parts of the sovereign democratic nation of Georgia. (Soviet) Russia, in its pursuit of its new “Principles” has broken international agreements signed as recently as April 2008 and the rest of the free world seems powerless to do anything except issue harsh letters and proclamations.

This disturbing declaration from the Russian leadership and analysis excerpted from the BBC News Europe -

New Russian world order: the five principles

In the aftermath of the Georgian conflict, the Russian President Dmitry Medvedev has laid down five principles that he says will guide Russian foreign policy.
By Paul Reynolds - World affairs correspondent BBC News website - 9-1-2008

Going back to the 19th Century?

The principles, with their references to "privileged interests" and the protection of Russian citizens, would probably seem rather obvious to Russian leaders of the 19th Century. They would seem rather mild to Stalin and his successors, who saw the Soviet Union extending communism across the globe.

In some ways, we are going back to the century before last, with a nationalistic Russia very much looking out for its own interests, but open to co-operation with the outside world on issues where it is willing to be flexible.

President Medvedev's principles do not, for example, necessarily exclude Russian agreement to continuing the strong diplomatic stance against Iran. And energy contracts are not necessarily threatened.

Above all, what they tell us is that the Georgia conflict was for Russia, in Foreign Minister Sergei Lavrov's words, a "long-cherished moment of truth", which has created a new "clarity".

Here are the principles, in the words which President Medvedev used in an interview with the three main Russian TV channels (translated by the BBC Monitoring Service).

1. International law

"Russia recognises the primacy of the basic principles of international law, which define relations between civilised nations. It is in the framework of these principles, of this concept of international law, that we will develop our relations with other states."

2. Multi-polar world

"The world should be multi-polar. Unipolarity is unacceptable, domination is impermissible. We cannot accept a world order in which all decisions are taken by one country, even such a serious and authoritative country as the United States of America. This kind of world is unstable and fraught with conflict."

3. No isolation

"Russia does not want confrontation with any country; Russia has no intention of isolating itself. We will develop, as far as possible, friendly relations both with Europe and with the United State of America, as well as with other countries of the world."

4. Protect citizens

"Our unquestionable priority is to protect the life and dignity of our citizens, wherever they are. We will also proceed from this in pursuing our foreign policy. We will also protect the interest of our business community abroad. And it should be clear to everyone that if someone makes aggressive forays, he will get a response."

5. Spheres of influence

"Russia, just like other countries in the world, has regions where it has its privileged interests. In these regions, there are countries with which we have traditionally had friendly cordial relations, historically special relations. We will work very attentively in these regions and develop these friendly relations with these states, with our close neighbours."

Asked if these "priority regions" were those that bordered on Russia he replied: "Certainly the regions bordering [on Russia], but not only them."

And he stated: "As regards the future, it depends not just on us. It also depends on our friends, our partners in the international community. They have a choice."

The implications

Those therefore are the stated principles. What implications do they have?

To take them in the order he presented them:

The primacy of International Law: This on the face of it sounds encouraging. But Russia signed up to Security Council resolution 1808 in April this year, which reaffirmed "the commitment of all Member States to the sovereignty, independence and territorial integrity of Georgia... " - and has since abandoned that position.

It argues that a Georgian attack on South Ossetia on 7/8 August invalidated its commitment and required that it defend its citizens there. But it perhaps cannot proclaim its faith in international law and at the same time take unilateral action.

This principle therefore has to be seen as rather vague.

The world is multi-polar: This means that Russia will not accept the primacy of the United States (or a combination of the US and its allies) in determining world policy. It will require that its own interests are taken into account.

The Russian Foreign Minister Sergei Lavrov hinted at what this really means. "There is a feeling that Nato again needs frontline states to justify its existence," he said in a speech. He was putting down another marker against the extension of Nato membership to Ukraine and Georgia.

Russia does not seek confrontation: Again this sounds hopeful but it based on the requirement that Russia's needs are met first. If the world agrees to its demands, then it is happy to be friends. But if not... therein lies the warning.

Protecting its citizens: The key phrase here is "wherever they are". This was the basis on which Russia went to war in South Ossetia and it contains within it the potential for future interventions - over Crimea, for example, populated by a majority Russian-background population yet owned by Ukraine only since 1954. If Ukraine looked set to join Nato, would Russia claim the protection of its "citizens" there?

Privileged interests: In this principle President Medvedev was getting down to the heart of the matter. Russia is demanding its own spheres of influence, especially, but not only, over states on its borders. This has the potential for further conflict if those "interests" are ignored.

Reference Here>>