US government shutdown

US Army and Intel: Shutdown already damaging national security

James Clapper, the director of national intelligence, and Ray Odierno, the US Army’s chief of staff, have both decried the impact of the government shutdown. Clapper has called employees’ unpaid furlough a recruitment ‘dreamland’ for foreign spy agencies.

RT,

2 October, 2013

"I've never seen anything like this. In my view I think this, on top of the sequestration cuts, seriously damages the safety and security of the nation," the DNI told a Senate Judiciary Committee hearing that was intended as a discussion of NSA surveillance powers.

Officials say that about 70 percent of all intelligence personnel have been forced to take unpaid leave, including 4,000 computer specialists.

“This affects our global capability to support the military, to support diplomacy, and to support our policymakers. And the danger here, of course, that this will accumulate over time -- the damage will be insidious. So each day that goes by, the jeopardy increases," said Clapper.

The official said intelligence agencies are setting up financial counseling for staff at a time of unusual vulnerability.

"This is a dreamland for foreign intelligence services to recruit, particularly as our employees, already many of whom subject to furloughs driven by sequestration, are going to have, I believe, even greater financial challenges,” said Clapper.

General Ray Odierno has said that the first government shutdown since 1996, "impacts significantly day-to-day operations" of the US Army.

"The longer it goes on, the worse it gets. Every day that goes by, we are losing manpower, we are losing capability,” the chief of staff told Reuters from Germany.

The army is currently furloughing “non-essential” personnel – particularly those not involved in live operations abroad.

The shutdown, which has forced 800,000 government employees to stay at home, began on Tuesday, after Congress failed to agree next year’s budget. The central bone of contention has been the funding of Obamacare, a scheme to widen health insurance coverage in the US.

Senator Ted Cruz, one of the most vehement opponents of Obamacare, has said that Congress should pass a special amendment that will exempt the army and security services from the shutdown.

"If God forbid, we see an attack on the United States because the intelligence community has not been adequately funded, every member of this committee would be horrified," said Cruz in front of the Senate Judiciary Committee.

Attempts in the past two days to push through various piecemeal mitigations of the shutdown have failed to garner enough votes.

The American Empire: Grinding To A Halt?

RT,

2 October, 2013

It’s the greatest superpower the world has ever seen. It’s economy is the envy of every other. Unfortunately, America also does dysfunctional politics on a grand scale.

Many will draw parallels with the epic shutdown of 1995 but there is a key difference: For all his many flaws, at least Bill Clinton was leading the USA. Nowadays Barack Obama may occupy the White House but he looks increasingly like a lame duck caretaker awaiting a professional President who will actually take charge.

Post shutdown 'blamestorming' is in full swing and Mr Obama is quick to attribute culpability to all around him. However, given that he ultimately decides what gets spent, is there not an element of hypocrisy in his attempts to avoid responsibility? Barak Obama has overseen a lavish spendthrift shift to the left under his Presidency yet feels it is beneath him to actually negotiate a bigger bar tab.

Congress have dug in their heels over health care changes which are highly questionable. Then again Obamacare needs a serious rethink. That’s not my view: it’s the opinion of the US trades unions who form Obama’s base support. They have realised that heaping costs on employers will result in fewer full-time jobs. That hurts the average citizen but Obama’s aloof plutocrats don’t care. Equally Congressional Republicans are understandably furious that the President seeks to ignore their democratic mandates while being keen to schmooze with an Iranian President elected via a dubious democratic process. Obama behaves with the demeanour of one who has a massive mandate, yet strip away the hype and he was a relatively narrow victor against two frankly mediocre opponents.

On the broader economic front, a crunch looms around October 20th. Then it will be time to return to Congress cap in hand and request not just the cash for another round of drinks but actually a full extension to Mr Obama’s burgeoning bar tab. The debt ceiling will soon be breached once again. The President fails to grasp the fundamental tenet of his expansionist government tendency: Nobody can keep spending citizens’ money indiscriminately and not expect to pay for it along the way.

The last shutdown showdown resulted in America losing its coveted AAA credit rating. The current rounds of high stakes bickering appear unlikely to improve the US’s debt standing. Moreover a prolonged stand-off of several weeks may yet produce more economic damage than the hurricane Katrina disaster. The daily cost is apparently circa 300 million dollars per day. Then again the stakes are raised as actually the current impediment to daily life is more frustrating than fundamental. The great outdoors is a bit smaller given the shutdown of national parks but really the “crisis” so far has largely demonstrated that the US remains a private powerhouse where government is an interruption to the success of the economy. Nancy Pelosi and her leftist elite may recoil in horror but actually they don’t benefit society - well apart from enriching the bond traders they claim to loathe.

In some ways a government shutdown is rather useful. It ought to restrain the frequently irresponsible behaviour of the government mortgage agencies whose bankruptcy was a result of their huge input fueling the last property bubble.

Fundamentally, the USA needs a rethink to make its governance system match its economic and military capacity. President Obama’s focus on creating the European socialist mess is a fascinating example of stubbornness from somebody who has barely experienced commerce. True, the Europeans would love to “merely” have Mr Obama’s mess but then again Mr Obama’s mess can easily resemble the EU’s given a few more decades to develop.

Against this cloudy backdrop, the US economy is gradually gaining growth once again, despite, rather than on account of, the vast government sums wasted on bank bailouts and other centrally planned programmes which only benefited the wealthy. In a certain sense, it’s morning in America once again. Quite why Mr Obama refuses to open the curtains at the White House to see the great potential of American enterprise beyond the Washington bubble remains a mystery. For all the pedantry of Congress, they have a point.

The President doesn’t deserve an extension to his bar tab. America needs to live within its means but it will need an outbreak of genuinely skilled government to achieve such leadership. Mr Obama demonstrates the impotence of what Ronald Reagan defined as the six most frightening words in the English language: “I’m from the government and I’m here to help.”

Patrick L Young is expert in global financial markets working in multiple disciplines, ranging from trading independently to running exchanges.

Max Keiser on shutdown: America one giant hedge fund & world's greatest soap opera

Washington's struggle to govern itself has already cost the American economy hundreds of millions of dollars on the first day of the government shutdown. And things are likely to get even more expensive, with neither Republican nor Democrat lawmakers willing to back down from their stance on Barack Obama's signature health care bill.

Max Keiser gives his comment on the government shutdown.