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EARLYBIRD

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Bush falls short of foreign policy goals, 'defiant' Stevens returns to Alaska, prospects for Iraqi security deal remain uncertain, college tuitions expected to rise, Bernanke signals interest rate could drop further, Japan announces stimulus plan.

• "Just outside President Bush's front door, construction began this week on grandstands along Pennsylvania Avenue for Inauguration Day," the Washington Times reports. "Signs of Mr. Bush's impending White House departure are now unavoidable. And yet as the end of the Bush presidency nears, the pace within the White House has barely slowed, if at all."

• "Having taken up residence in the White House nearly eight years ago with almost no foreign policy experience, President Bush set ambitious goals for himself and the country. He was determined to expand democracy around the world and maintain a role for the United States befitting the world's only superpower," AP reports. "Now, with less than three months left, Bush appears destined to step down without achieving many of his global objectives."

 

• "For years, the military has been roiled by a heated internal debate over what kind of wars it should prepare to fight," with some favoring expensive weapons systems and others advocating for boots on the ground. "The dispute has long been largely academic," the Wall Street Journal reports. But "that is beginning to change, a casualty of the widening global financial crisis."

• "Conceding it needed outside help in figuring out why the suicide rate among service members was rising, the Army announced plans on Wednesday to collaborate with the National Institute of Mental Health in an ambitious five-year project to identify the causes and risk factors of suicide," the New York Times reports.

• "Three defense giants on Wednesday won multi-million contracts to build prototypes of a new tactical ground vehicle for the Army and the Marine Corps to replace the Humvee," The Hill reports. "Teams led by Lockheed Martin, General Dynamics and BAE Systems were awarded development contracts for the Joint Light Tactical Vehicle (JLTV) program.... The project could ultimately be worth about $20 billion."

 

• "The top staff regulators who oversaw the approval of new drugs in this country objected to the Bush administration's drive to shield drug makers from being sued, according to internal documents released Wednesday by Rep. Henry A. Waxman (D-Beverly Hills), chairman of the House Oversight and Government Reform Committee," the Los Angeles Times reports. "The regulators said the White House and top administration officials were operating under the 'false assumption' that warning labels on new drugs were adequate and up-to-date."

• "The Internal Revenue Service is considering a plan to curb a tactic commonly used by multinational corporations with American operations to lower their tax bills, a move that would help bring back some of the billions of dollars in taxable profits held overseas," the New York Times reports.

Congress: All Sides Vie To Shape Second Stimulus

• "Governors David A. Paterson [D] of New York and Jon S. Corzine [D] of New Jersey added their voices Wednesday to the growing support for a second federal economic stimulus package, saying state governments would face devastating cutbacks if they did not receive assistance soon," the New York Times reports. "Appearing before separate congressional committees, they said that their states, like many others, had already moved to address budget deficits. Their actions alone would not be enough, they said."

• "Lobbyists descended on Capitol Hill to push for an economic-stimulus bill that could cost as much as $150 billion, but prospects for quick passage are clouded by Republican opposition and disagreements over how to spend the money," the Wall Street Journal reports. "Democrats on Wednesday outlined a 'Main Street' recovery platform that would boost spending on transportation projects, unemployment benefits and energy assistance. Republican leaders countered with tax-cut proposals."

 

• "Following a disappointing 2008 presidential run that left him with diminished stature in the Senate Democratic Conference, Sen. Chris Dodd (Conn.) is likely to find himself in the enviable position of having his choice of powerful committee chairmanships under a newly emboldened and enlarged majority," Roll Call (subscription) reports.

• "Through a quirk in the rules, Connecticut Sen. Joe Lieberman [I/D] may once again emerge as the Senate Democrats' indispensable man," the Washington Times reports. He "could -- a number of election forecasters project -- provide the crucial 60th vote party strategists are lusting for to build a 'filibuster-proof' Senate majority after Nov. 4."

• "Prompted by the recent federal conviction of Alaska Sen. Ted Stevens (R), government reform advocates will renew their push for an independent office to fortify the Senate ethics process," Roll Call (subscription) reports. "While the House approved an Office of Congressional Ethics earlier this year... the Senate has twice rejected similar proposals."

• "A defiant" Stevens "returned to his home state Wednesday a convicted felon, telling cheering supporters at an airport that bears his name that he's innocent and vowing he will be vindicated," AP reports. "It was the 84-year-old lawmaker's first stop in Alaska since a federal court jury in Washington convicted him Monday of seven counts of lying on Senate disclosure forms."

Iraq: Prospects For Security Deal Remain Uncertain

• "President Bush said Wednesday he is confident he can work out a new security pact with the Iraqis before year's end," AP reports. "But time is running out and the two sides may be forced to ask for an extension of the current U.N. agreement allowing the U.S. military to operate in Iraq."

• Meanwhile, "a senior Iraqi political leader said" Wednesday "he is 'doubtful' that a bilateral agreement authorizing U.S. forces to remain in Iraq after the end of the year would be approved by the Iraqi cabinet and parliament," the Washington Post reports. "Massoud Barzani, president of the Kurdistan Regional Government, said most political factions in Iraq want the accord to go through. But he said the country is 'in a situation of intellectual terrorism, where people are not able to state their real positions' for fear of appearing too close to the United States."

• "Twenty-eight teams of U.S. military officials, customs experts and former U.S. Border Patrol agents working as private contractors have been sent to small outposts along Iraq's 2,270-mile border, where U.S. officials also employ ground sensors linked to satellite cameras and unmanned aerial vehicles," the Post reports. "U.S. officials say the dragnet has led to the detention of hundreds of 'adversaries' and yielded a clearer understanding of smuggling networks. Officials plan to double the number of border teams by the end of the year."

• "No one knows for sure, but auditors think the U.S. has paid well over $6 billion to private security companies who've been guarding diplomats, troops, Iraqi officials and reconstruction workers in Iraq," AP reports. "The money amounts to about 12 percent of the $50 billion Americans are paying for reconstruction in the country, said Special Inspector General for Iraq Reconstruction Stuart Bowen."

Nation: College Tuitions Set To Rise Amid Downturn

• "Several newspapers and television stations, along with at least one congressman's office, received envelopes Wednesday labeled 'anthrax,' law enforcement authorities said," AP reports. "Tests have turned up no evidence so far that the packages were dangerous. Investigators said many of the mailings had the same fictitious Sacramento," Calif., "return address."

• "Deciding he could wait no longer," Nebraska "Gov. Dave Heineman [R] said Wednesday that he would call a special legislative session to alter a safe-haven law that in just a few months has allowed parents to abandon nearly two dozen children as old as 17," AP reports. "Heineman had planned to wait until the next regular legislative session in January but changed his mind as the number of dropped-off children grew."

• "College students and their parents should brace for sharp tuition increases as the widening economic downturn begins to hit campuses across the country, an organization of higher education officials said" Wednesday, the Washington Post reports.

• "The sharp decline in gasoline use earlier this year... suggested to many people, including the automobile companies, that a permanent change in American habits might be at hand," the New York Times reports. "But with gasoline prices falling drastically in recent weeks, some American drivers are returning to their old ways."

• "A broad array of businesses across the New York region have begun eliminating jobs by the thousands as the pain of the financial crisis spreads well beyond Wall Street," the Times reports. "Companies as varied as Yahoo, American Express, Time Inc. and Swissport Cargo Services at Kennedy International Airport say they are preparing to lay off employees, including online ad sales representatives, magazine editors and baggage handlers, in the coming weeks."

Economy: Treasury & FDIC Near Deal On Mortgage Rescue Plan

• "Federal Reserve Chairman Ben S. Bernanke signaled he's ready to cut interest rates to the lowest level on record should the central bank's actions fail to stem the deepening economic slump," Bloomberg News reports. "Policy makers said" Wednesday "that 'downside risks to growth remain' even after their half-point reduction in the main rate to 1 percent."

• "Negotiators for the Treasury and Federal Deposit Insurance Corp. are nearing agreement on a plan to have the government guarantee the mortgages of millions of distressed homeowners in what would be a significant departure for the federal rescue program, which has so far directed relief exclusively to banks and other financial institutions," the Washington Post reports. "Sources said" the plan "could cover as many as 3 million homeowners in danger of foreclosure and cost $40 billion to $50 billion."

• "U.S. banks getting more than $163 billion from the Treasury Department for new lending are on pace to pay more than half of that sum to their shareholders, with government permission, over the next three years," the Post reports. "Critics, including economists and members of Congress, question why banks should get government money if they already have enough money to pay dividends -- or conversely, why banks that need government money are still spending so much on dividends."

• "On Wednesday, the International Monetary Fund announced it would lend up to $100 billion to healthy countries that are having trouble borrowing as a result of the turmoil in the global markets," the New York Times reports. "And the Federal Reserve said it would commit up to $30 billion each to Brazil, Mexico, South Korea and Singapore, to enable those countries to more easily swap their currencies for dollars."

• "US companies will need to inject more than $100bn into their pension funds to cover market losses, putting them in a cash squeeze at a time when it is difficult to raise money," the Financial Times reports. "The cash payment, estimated by several pension industry executives, would be spread over this financial year and next year."

• "The U.S. economy probably shrank in the third quarter by the most since the 2001 recession just as Americans were deciding how to cast their ballots in the Nov. 4 elections. Gross domestic product contracted at a 0.5 percent annual rate from July to September, according to the median forecast of 75 economists surveyed by Bloomberg News."

World: Fighting Reaches Capital In Congo; Japan Announces Stimulus

• "Japanese Prime Minister Taro Aso announced a 27 trillion yen ($275 billion) stimulus package to shore up the world's No. 2 economy" today, "vowing to dispel fears over the global financial crisis with expanded credits for small businesses and a cash payback to every household," AP reports.

• "The French president, Nicolas Sarkozy, is running as fast as he can, but the European recession is gathering pace," the New York Times reports. "After initially good reviews for his leadership and quick response to the crisis, even Mr. Sarkozy's vaunted hyperactivity is starting to seem a little counterproductive, especially among his allies."

• "An escalation of Congo's long-simmering conflict reached the gates of" Goma, the capital city, "Wednesday as a rebel offensive sent tens of thousands of villagers fleeing toward the city and government soldiers left their posts," the Washington Post reports. "Over the past decade, two civil wars and fighting among militia groups have left millions dead in strife rooted in the unresolved aftermath of the 1994 Rwandan genocide. On Wednesday, the tensions threatened to flare into yet another war, despite the presence of 17,000 U.N. peacekeepers in the region."

• "The Colombian government on Wednesday fired 27 army officers and soldiers, including three generals, amid allegations that poor young men had been lured to the country's turbulent outback from slums in the capital and killed there by troops," the Post reports. "The purge... is considered unprecedented for Colombia's large, U.S.-backed army, which has long resisted reforms."

• "A suicide bomber blew himself up inside the Afghan Ministry of Information and Culture in Kabul" today, "killing at least three people and badly damaging part of the building, officials and witnesses said," AP reports. "The Taliban claimed responsibility."

• "General David Petraeus, fresh from his widely praised tenure as US commander in Iraq, on Friday takes the helm at Central Command, a promotion that gives him the added responsibility of Afghanistan," the Financial Times reports. "He now faces in Afghanistan what he himself calls 'the longest campaign of the long war.'"

• "Foreign Minister Tzipi Livni would finish in a dead heat with hawkish opposition leader Benjamin Netanyahu if voting were held today, a new poll showed" today, "reinforcing indications that the coming Israeli election could perpetuate a peacemaking deadlock," AP reports. "The survey, published in the Haaretz daily, also showed an even split between Israel's hardline and moderate parties -- a divided that has crippled peacemaking for years."

• "Overlooking the verdant Valley of Elah, where the Bible says David toppled Goliath, archaeologists are unearthing a 3,000-year-old fortified city that could reshape views of the period when David ruled over the Israelites," the New York Times reports. "Five lines on pottery uncovered here appear to be the oldest Hebrew text ever found and are likely to have a major impact on knowledge about the history of literacy and alphabet development."

Campaigns: McCain Ramps Up Spending

Barack Obama may have dropped $4 million on last night's 30-minute prime-time ad, but John McCain is closing the television spending gap in key states. Earlybird's Campaign News section has more.

Commentary: One Big Democratic Party

• What are the pros and cons of an "Obama-Reid-Pelosi triumvirate"? Earlybird's Pundits & Editorials section has some speculation.

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