Is United States Declining?

Gabriel Kazakias

If you search the internet about US economic as well as military power, you end up with a rather gloomy picture. In 2008, the US National Intelligence Council admitted for the first time that America's global power was indeed on a downward path. Current projections claim that the US will find itself in second place behind China in economic output around 2026 and behind India by 2050.

American leadership in technological innovation is on the wane. In 2008, the US was still number two behind Japan in worldwide patent applications but China was closing fast.

Add to this the US education system that brings our future scientists and innovators behind our competitors and you will understand why some claim of our shortage of talented scientists by 2025.

Such negative trends are increasingly sharp criticism of the dollar's role as the world’s reserve currency. Faced with a country that is incapable of paying its bills, China, India, Iran, Russia, and other powers challenge our authority.

By 2025, Iran and Russia will control almost half of the world's natural gas supply, which will potentially give them enormous leverage over Europe. China pours billions into building a massive trans-Asia pipeline and funding Iran's exploitation of the gas field at South Pars in the Persian Gulf. Meantime here in the United States we are so dependent upon foreign oil that any adverse developments could spark an oil shock.

On the other hand we also need to recognize our potential. China has a long way to go to equal the power of the United States. Even if overall Chinese GDP passed that of the United States around 2030, the two economies would not be equivalent in composition. China would still have a vast underdeveloped countryside. Per capita income provides a measure of the sophistication of an economy. Assuming a 6% Chinese GDP growth rate and only 2% American GDP growth rate after 2030, China would probably not equal the United States in per capita income until sometime around the middle of the century.

American education used to set the global standard. But American education our primary and secondary schools, especially in less affluent districts, lags badly behind. This means that the quality of the labor force will not keep up with the rising standards needed in an information-driven economy. Improvement in the country’s K-12 education system will be necessary if the country is to meet the standards needed in an information-based economy.

It is time re-analyze the future of U.S. power. It is my belief that the United States is not in absolute decline and there is a reasonable probability that it will remain more powerful than any single country in the coming decades.

The problem of American power in the twenty-first century is not one of declining but one of realizing that even United States cannot achieve greatness without the help of others. The United States will need a smart strategy that emphasizes alliances and networks that are responsive to the new context of a global information age.

Saudi Arabia Scrambles to Limit Region's Upheaval

By NEIL MacFARQUHAR

Saudi Arabia is flexing its financial and diplomatic might in a bid to avert the overthrow of any more leaders in the Middle East.

Aid Pledge by Group of 8 Seeks to Bolster Arab Democracy

By LIZ ALDERMAN

The world's leading industrialized nations said they would help revive the economies of Egypt and Tunisia to help anchor stability in the region.

Chevron Feels the Heat: Annual Shareholder Meeting Brings Huge Protests For Oil Giant's Abuses Around the World

"We are the human face of Chevron's operations, armed with the memories of our dead relatives, our neighbors, our sick children," said one woman who traveled from Ecuador.

We're in Dire Straits When the Only Employment Sector Catching Fire Is in Unpaid Internships

The United States still counts a depressing 24 million unemployed, while the number of exploited unpaid workers keeps growing.

Signs That Bin Laden Weighed Seeking Pakistani Protection

Did Netanyahu miss the “mutually agreed swaps”?

  
Netanyahu lectured Obama like some schoolboy in the Oval Office and two days later Obana trooped over to the Israeli lobby AIPAC to repeat what he had said that had so infuriated Netanyahu.
   
Obama said the following: "We believe the borders of Israel should be based on the 1967 lines with mutually agreed swaps, so that secure and recognized borders are established for both states. ... Israel must be able to defend itself -- by itself -- against any threat."
   
Did Netanyahu miss the “mutually agreed swaps”? Why did he ignored the call for "mutually agreed swaps" of land, and why did he warn the president against a peace "based on illusions"?
   
All Obama was saying was what three Israeli prime ministers, Yitzhak Rabin, Ehud Barak and Ehud Olmert, have also recognized in the past.
   
To get Palestinian and international recognition for a united Jerusalem and Israel's annexation of the settlements around the city, Israel will have to trade land for land.
   
Obama was not saying the 1967 borders were to be the end of negotiations but the starting point.

Undeniably, Netanyahu won the Oval Office discussion and the president was somehow disgraced. Politically, the president has been hurt.

   
In Israel, Netanyahu is seen as having stood up for Israel's vital interests and forced an American president to back down. His right-wing coalition is cheering him on.
   
Netanyahu, who is raised in the US and who knows American politics chose to do this. Why would the leader of a nation of 7 million that is dependent on U.S. arms, foreign aid and diplomatic support choose to humiliate a president who could be sitting in that office until 2017?
   
The only explanation that I can offer is because Netanyahu would like to see Obama replaced by someone more sympathetic to Israeli issues. 

Study Questions Treatment Used in Heart Disease

By GARDINER HARRIS

Surprising results suggest that raising patients' good cholesterol did not seem to matter against heart disease.

Let me begin with a moment of candor: I’d honestly be surprised if a majority of the American people even know that America is at war in Libya. I’d be far more surprised if any significant number of Americans know that our self-declared unitary executive has disregarded his legal requirement to secure approval from Congress in order to continue his war beyond the already-passed 60 day mark, which passed by a week ago.

HR 1380, otherwise known as the “NAT GAS Act”, is bipartisan legislation (sponsored by 105 Democrats, 83 Republicans) supported by billionaire T. Boone Pickens that would provide billions of dollars in tax incentives for the production and use of natural gas vehicles. Several fiscal conservatives in the House have been duped into thinking this is a good bill but I hope that they immediately withdraw their names as co-sponsors. Putting aside the fact that market-distorting tax credits destroy the system of free enterprise, and are opposed by the Club for Growth, I wanted to highlight one specific part of the bill.

Ass-Backward Reality: The Myths That Underpin the Failure of American Policy in the Middle East

Let’s be honest. The Israeli story doesn’t merely distort the truth, it turns the truth ass-backwards.

Protections for military whistleblowers, a Libya clarification and rules of engagement are just a few of the measures holding up the bill...

Attract Luck and be Popular

Gabriel Kazakias

Do you know someone who always attracts luck? They don’t take any effort at all but they are popular and successful without even trying.

But you need to realize that is not such a thing as pure luck, you attract luck by projecting something that is admired by others.

When people know that you are knowledgeable about everyday events and global news and you are also willing to help, they will go the extra step for you.

The second important thing to attract luck in your life is to have a positive outlook. Having available the world news at your fingertips, most certainly, improve your outlook and self esteem.

Having said that I invite you to browse my blog below:

http://wisenet-global.com

My Thoughts On The Economic Crisis

Gabriel Kazakias

The annual deficit or surplus refers to the cash difference between government receipts and spending, ignoring intra-governmental transfers.

Is there a "danger level" of debt? Economists Kenneth Rogoff and Carmen Reinhart claimed that 90% of GDP might be an indicative danger level. The GDP presently is $14.94 Trillion and 90% of the GDP is $13.44 Trillion which is almost as much as the national debt at $14.35 trillion.

Both parties agree that we need to reduce the deficit. The democrats are reducing the deficit by slightly reducing spending and by increasing taxes especially to the rich ($250,000 plus). The republicans, in addition to decreasing the government spending, are also reforming the Medicare and Medicaid systems.

Medicare is presently covering approximately 48 Million American Seniors and it is mainly paid by the federal government. Under the Republican Plan this system would change. Seniors would be allotted certain amount of money based on their income, and they would need to shop privately for coverage on insurance exchanges set by the State.

Medicaid covers approximately 60 Million Americans and nearly half of them are children. The Federal Government matches every dollar the States spend on Medicaid. Under the Republican plan the Federal Government would allocate money to the State which in turn would spend the money according to its need.

We are still the strongest economy in the world, our GDP attest to that, but we need to solve our deficit problem.

The Congressional Budget Office deficit for 2011 is projected to be $1.25 Trillion.

                  Total Annual Revenues = $2.23 Trillion
                  Total Annual Outlays = $3.71 Trillion
                  Total Annual Deficit = $1.48 Trillion
                  Net Annual Interest = $0.23 Trillion
                  Primary Annual Deficit = $1.25 Trillion

My thoughts about improving our economic crisis:

1.    Corporate Taxes: The American businesses pay a higher corporate tax rate than companies in other advanced economies. In order to get Americans back to work and boost investment in the U.S., we must enact tax reform that lowers the U.S. corporate rate in order to level the playing field for American businesses. We also have to make sure, 100 percent sure that all tax loopholes are closed and a heavy tax penalty will apply to companies that bring their business outside of United States. I am not exactly sure how to accomplish this but our financial and tax professionals are more than capable to find an equitable solution.

2.    Health Care System: As far as the Health Care System goes, even though the President’s plan might be helpful in retaining health coverage, I believe it will increase premiums, decrease coverage and increase taxes. Let’s not forget something. The United States Health System, although it needs some regulatory adjustment, it is still the greatest Health System in the world.

3.    Tax System: The current tax system with the Bush tax cuts in place collects about 18 percent of GDP, but we need 24 percent of GDP for our spending needs. Keeping in mind that the 5 percent high income earners pay 50 percent of the country’s taxes and they are, at least theoretically, job producing entities. So, if we set the taxes at 22 percent of GDP by taxing slightly more high-income earners and by closing corporate loopholes we will be closer to the level needed to meet the budget needs in future years.

4.    Medicare: The Medicare’s administrative costs are in the range of 3 percent which is well below the 5 to 10 percent participated cost by large, self-insure companies. And it is also lower than the 40 percent administrative costs of individual insurance. It’s even far below the 11 percent costs of private plans under Medicare Advantage, the current private-insurance option under Medicare. If Medicare coverage is extended to the entire population it is estimated that we could save up to $400 billion a year. More Americans would get quality health care, and the long-term budget crisis would be sharply reduced. In addition, the Medicare – and its poor cousin Medicaid – will use their bargaining leverage to negotiate lower rates with hospitals, doctors, and pharmaceutical companies.

5.    In addition we need to consider decreasing the defense spending, privatizing Fannie Mae and Freddie Max and cap all non-security discretionary spending at 2008 levels.

Finish the Job in Libya
Researched by Gabriel Kazakias

PRESIDENT OBAMA insists that protecting civilians is the only military objective in Libya and air power is the only means we will use to achieve it. But the Libyan government’s attacks on civilians continue, and air power alone will not stop them.

Leadership is not exercised by those who seek to risk as little as possible. We should stop pretending that we’ve passed the leadership for the Libyan operation on to NATO. Like it or not, America’s leadership has been crucial to most of NATO’s successes. The same will be true in Libya.

Bombing is extremely effective against targets that are clearly distinguishable from civilians and friendly forces. The United States and its allies could commit the military resources required to genuinely protect Libyan civilians and oust Colonel Qaddafi. To give them a fighting chance, NATO must put military advisers and combat air controllers on the ground — not just British, French and Italian, but also American ones. This would not defeat Colonel Qaddafi’s forces overnight, but it would put far more pressure on his regime and potentially protect more civilians in more of the country.

So far, we have chosen air-strikes that are powerful but cannot attain our humanitarian or strategic aims by themselves. America has intervened in a civil war with the aim of regime change in Libya. Washington must now accept that decision and face its consequences.

(NYT)

The ailing market is not going to heal itself. The Obama administration should champion a government fix, and Congress and regulators should act on it.

After the historic gains made by conservatives — not just Republicans — in 2010, the conservative movement stands to slide back and lose in 2012.

I’m not talking about the race to the White House. I’m talking about the United States Senate. At a time when Senate Republicans refuse to lead and Mitch McConnell is doing his best to marginalize the solid conservatives, the right is distracted by the White House. The same GOP that tried to stick the right with Trey Greyson, Charlie Crist, Mike Castle, and more is going to try again. If conservatives are not vigilant, they’re going to be stuck with the likes of Heather Wilson, etc.

Memo to Obama: Pakistan Is Not a Client State

Pakistan a far more formidable and independent force than U.S. policymakers concede publicly or even privately.

Witness the Shocking Denial and Ignorance About the Occupation of Palestine by AIPAC Delegates

Interviews with several AIPAC delegates in the streets outside the conference reveals widespread ignorance by attendees of the controversial annual DC meeting.

My thoughts about Ryan's Medicare plan
Gabriel Kazakias

Last Friday when I was asked about Paul Ryan's plan to reform Medicare I stated my fears that the plan might add additional burdens to seniors such as the decision and purchasing of health insurance coverage as well as put them at risk of not being able to afford it.

I believe any reform to the existing Medicare system should include in its core the protection of those who are counting on the current system through their entire adult life.

Medicare, as we know it, has already taken significant abuses such as Medicare frauds and half trillion dollars cuts from the private side of Medicare (Medicare Advantage) to help pay for the president’s Health Care Plan.

We all agree that we need to work on the system to make it leaner and more efficient. There are plenty of ways to reform the system from within, including eliminating Medicare fraud.

It has estimated that nearly $60 billion of annual Medicare spending is nothing but waste, fraud or abuse. So, we should start making improvements to the traditional Medicare system by increasing congressional oversight as well as improving the quality of medical care to seniors.

There is a story out this morning that Sarah Palin’s top aide Rebecca Mansour sent out a series of nasty direct messages on Twitter about Sarah Palin’s daughter, Mitt Romney supporters, others, and me.

In Europe, Rifts Widen Over Greece

Fissures among Europe's currency partners are deepening, raising new doubts about whether the group can resolve a regional debt crisis.

Is There Any Hope for Greece?

Would leaving the euro zone be a sound option for Greece?

Greece helps gold rally
Business Report 5/23/2011

Reasons to buy gold came in the form of doubts about Spanish austerity measures, an outlook downgrade to Italy's credit rating and growing speculation about Greek debt restructuring.

“The driving factor is obviously concerns about Greece and whether there will be a debt restructuring,” said Robin Bhar, analyst at Credit Agricole.

“Greece is important in terms of the implications it will have for other weak euro zone economies such as Ireland and Portugal. Markets have started the week in risk-off mode.”

Greek Prime Minister George Papandreou will discuss new measures with his cabinet on Monday to cut the budget deficit, in an effort to convince lenders Greece can deal with a debt crisis without a restructuring.

However, holding gold in check is the higher dollar against the euro, which makes commodities priced in the U.S. currency more expensive for holders of other currencies.

At least four Naval personnel, including one officer and one sailor, were killed in the attack by at least 10 to 15 unidentified gunmen.

There seems to be some confusion over why the Israelis should be so hostile to President Obama’s suggestion that the two-state solution be achieved by returning the Jewish state to its 1967 borders. The President’s supporters argue that since these borders were previously acceptable to Israel, they should be acceptable now. After all, pre-1967 Israel fought to defend those borders and they were on the table in the 2000 peace talks. Can 45 years make that much of a difference?

It is true that 45 years is not so very long in terms of the territorial integrity of the United States. We might even prefer to return to the 1967 context in which our borders were much less challenging than they are today. But what Mr. Obama seems to fail to understand is that 45 years is a very long time for Israel. While the history of the Israeli people stretches back millennia, lsrael itself has only existed for 63 years. What the President is asking is that more than 70% of that history be erased, beginning with the reasons it was deemed necessary to annex the territories in 1967, and continuing on through the failed diplomatic initiatives, UN humiliations and relentless, deadly terrorist attacks of the past decades (including the last one, as Jeff Emanuel discussed yesterday). While some have considered Prime Minister Benjamin Netanyahu’s terse response to this proposal disrespectful of the President, Mr. Netanyahu might have some very real concerns that once three-quarters of Israel’s past has been eradicated, would it be all that outlandish to go all the way to pre-1948? Especially under the leadership of an American president who is asking the Israelis to make this concession on the dubious grounds that hope will overcome hate?

On Saturday, several thousand people showed up in the humid heat of Atlanta to hear Herman Cain announce his bid for the Presidency.

Today, in Iowa, Tim Pawlenty will announce his bid. If you have not seen it already, go watch Pawlenty’s preview. I am actually floored it is so well done.

Newt Gingrich is already in.

Mitt Romney will make a big splash soon and for all intents and purposes is fully and already in.

Then were are Michele Bachmann, Rick Santorum, and a few others with Sarah Palin as a late entrant possibility.

I hope like heck that this is it. I hear rumblings of a few wild cards, but let’s take the field as officially announced: Herman Cain, Newt Gingrich, and Tim Pawlenty. Add Mitt Romney in there because it is abundantly obvious he has been in this since at lease December of 2008 and you actually have a solid, relatively conservative field to pick from.

Republican angst over a bad slate mirrors the Democrat angst in 1991. But in 1991, the slate that was there went on in 1992 to pick the next President of the United States.

We have our nominee in this field. I can live with the field and I hope you can too.

Republicans, not just conservatives, are at risk of a self-fulfilling, self-defeating prophecy that the field sucks and cannot beat Obama. It’s the economy, stupid. It always has been. It always will be. And America can do better than Barack Obama with any of the candidates we now have.

Obama Challenges Israel to Make Hard Choices Needed for Peace

“Since my position has been misrepresented several times, let me reaffirm what “1967 lines with mutually agreed swaps” means,” Mr. Obama said. “By definition, it means that the parties themselves — Israelis and Palestinians — will negotiate a border that is different than the one that existed on June 4, 1967. It is a well known formula to all who have worked on this issue for a generation. It allows the parties themselves to account for the changes that have taken place over the last 44 years.”

Three decisions that would be good for the country

Stand up for Medicare and Social Security.
It seems to me that the public has decisively rejected the Republican plan to end Medicare and replace it with vouchers. The public feels just as strongly that Social Security shouldn't be cut. And it doesn't need to be, since it doesn't contribute to the deficit.

Defend our financial national security, too.
A strong homeland needs to be protected from attacks. It also needs to be protected from the predation of dishonest financiers, a collapse of the global banking system, and unnecessary depressions and recessions. We've seen a wave of attempts to de-fang, de-claw, and de-fund the regulatory agencies that exist to protect us from these dangers. Don’t let it happen.

Jobs. Jobs. Jobs. Jobs. Jobs.
39% of the public say that jobs and the stagnating economy are our most pressing need, while only 15% are convinced that our biggest problem is deficits.

Deficit to surplus but when

When the Senators, Congress people, and President all gather around to start discussing issues of the budget, many people get worried.  One of the biggest worries is that taxes will rise, and there will still be a deficit.  This worry is fueled each year, because as the inflation rate rises, the money must come from somewhere to fund everything that is necessary for the government to function.

Many departments could use a serious slim down, while other departments desperately need more money.  While the defense of the nation is very important, many question why schools and education are not given a larger portion of the budget so that proper job training can be administered.  This would enable students to graduate with a better understanding of the career world into more graduate-centric employment opportunities, such as those within the services sector.

Each year the department heads all gather together to come with ideas of improving their departments and asking for more money.  Given that there are so many conflicting interests and political pressures, it is difficult to understand the logic behind some of the decisions made in relation to the budget.

If a business managed money the same way the government does, they would have gone bankrupt many years ago and been forced out of business, with the directors prosecuted for wrongful trading.  NASA, for example has spent thousands, upon thousands of dollars developing a pen that will write in space.  The idea of a pencil never crossed their minds.  Arguably, the idea of funding space exploration at a time when there is a budget deficit is also irrational.

There is always a hope that at some point in the near future the United States will manage to pull out from the deficit that it has created and restore itself to having a surplus budget.  It will take time, effort and a great deal of belt tightening to get there, nevertheless, it will happen at some point.   

Economic Indicators

World Population = 7.0 Billion

World GDP = 58.15 Trillion

World GDP per Capita = $8,210

USA Population = 310 Million

USA GDP = $15.0 Trillion

USA Debt External = $15 Trillion

USA Deficit-2010 = $1.56 Trillion

Proposed Budget-2011 = $3.8 Trillion

USA Deficit-2011 = $1.3 Trillion

China Population = 1.35 Billion

China GDP = $5.0 Trillion

China Debt External = $340 Billion

India Population = 1.2 Billion

India GDP = $1.3 Trillion

India Debt External = $166 Billion

Brazil Population = 194 Million

Brazil GDP = $1.57 Trillion

Brazil Debt External = $277 Billion

Greece Population = 11.3 Million

Greece GDP = $330 Billion

Greece Debt External = $533 Billion

1.     The number of people living in poverty is about 100 Million, while the world income increased by 2.5% annually.

2.     Low Inflation, in general, and economic Growth is never possible but highly desirable.

3.     IMF’s million of dollars used to maintain exchange rate at unsustainable levels for a short period of time during which the creditors (G7) are able to pull their money out of their country. The original IMF loan is paid by the taxpayers at probably lower exchange rate.

4.     Today prudence requires countries to maintain reserves at least equals to the short –term dollar debt. Mooney for the reserves are mostly US Treasury Bills which are highly liquid but yield a low interest rate about 1%.

5.     In March 2001 America went into recession.

6.     In Oct. 2008 America’s economy was in FreeFall taking down much of the world’s economy with it.

7.     The $168 Billion tax cuts in Febr. 2008 did not improve the economy.

8.     Greenspan lowered the interest rate which created the real estate bubble. In addition lax regulation and cheap mortgages with no protection for the homebuyer increase the real estate bubble.

9.     Invasion of Iraq, oil prices rose from $32/barrel in 2003 to $137/barrel in 2008.

10.  Credit Default Swaps (CDS) are similar to insurance, they can be purchased for treasury bills or country’s bonds and they will pay the holder when these bonds default. Many are using the price of these instruments to evaluate the default risk of a country.The 4800 Billion stimulus package was too small for a $14Trillion economy.

By JUDY DEMPSEY (NYT)

Foreign Minister Sergey V. Lavrov said Russia did not want any missile defense system used by the alliance in Europe to be aimed at the country.

By ISABEL KERSHNER (NYT)

For the roughly 20,000 Arabs of the Druze religious sect who live in the Israeli-controlled Golan Heights, this is Syrian territory.

By CHRISTINA D. ROMER (NYT)

It’s standard Washingtonspeak: The United States favors a strong dollar. But sometimes that’s not the right answer.

Everything is on the Rise...AGAINST the U.S. Dollar.

The Federal Reserve & Treasury Department are stuck between a Rock and A Hard Place.
If they Raise Interest rates... the economy goes into a Tail Spin.
If they Stop Borrowing and Issuing Debt....The Monetary(Ponzie-Scheme) System Fails.
BUT, If they continue Down the Same path...

The Collapse of the U.S. Dollar is Imminent.