March 6, 2013
- Singing “Kumbaya” on Capitol Hill: How a “deal” they’re cutting in Congress is selling you out
- Justice Department asserts the “entirely hypothetical” authority to vaporize U.S. citizens on U.S. soil with its drones: Petition drive takes on new urgency
- Years of U.S.-fomented civil war? How the Syria model might be in store for a post-Chavez Venezuela
- Because the third time’s a charm: After yesterday’s record high, our forecast for the Dow… and the boomer generation
- The SWAT team headed to 5 readers’ doors (it’s not what you think)… 10 years of Homeland Security (?)… and more!
Beware: Anytime the words “very constructive conversations” come out of Washington, you know it’s time to hold onto your wallet.
So it goes this morning. Apparatchiks from both parties in Congress and the White House are content to let the “draconian cuts” that took effect last Friday remain in effect.
That is if you consider a $15 billion hike in spending year over year a “draconian cut.”
[Ed. Note. Fair warning: This episode of The 5 Min. Forecast is overtly political. We suppose that's what happens when we all get shuttered in by blustery winds and a wintery mix of rain and snow. If you're sensitive to alternative political views, we give you permission to avert your eyes... and return tomorrow. Cheers.]
Otherwise, the show must go on. The next opportunity for politicians to bathe themselves in media glow: Wednesday, March 27. That’s when a “continuing resolution” that keeps the government nominally funded will expire.
The same Congress that made gold ownership for U.S. citizens legal again in 1974 cursed us with the procedural snafu of “continuing resolutions”… or what Congress does these days in lieu of passing an actual budget.
Without another continuing resolution after March 27, the prospect of a “partial government shutdown” looms — the kind that caused much weeping and gnashing of teeth in the fall of 1995 when Clinton and Gingrich pretended to rule the roost and Mariah Carey topped the charts with “Fantasy.”
(Yeah, we blocked that out of our memory too.)
“Congress initially was required to cover only the upcoming fiscal year in the budget resolution,” explains the Congressional Research Service, “but over the years, Congress has expanded this time frame. Currently, the budget resolution must include at least five fiscal years.”
In other words, there’s a boatload of backroom horse trading… lots more front-room preening… and deals that ultimately won’t mean a thing; as with all of history, this Congress can’t bind any future Congress to their acts.
Still, won’t it sound great when they can tout “$2 trillion in savings”… by spending $2 trillion less over the next five years than was originally planned?
Maybe we’ll get another historic boost in the Dow!
Back to the present and those “very constructive conversations”: House Speaker John Boehner plans a vote on a new “continuing resolution” sometime before “snowquester” stops shedding its flakes on the capital.
A Senate vote follows next week: Mitch McConnell is “optimistic.” Harry Reid says he’s only “cautiously optimistic.” They must keep up the pretense there’s a difference between the two, after all.
Uh… which one is… umn, who?
Even with “sequestration” in place and a “continuing resolution” passed, there’s a staggering amount of federal spending left untouched. According to the president’s own budget documents, the spending left alone totaled $2.477 trillion last year. Tax revenue totaled $2.469 trillion.
If you didn’t get our email last night about how the White House and Congress just sold you out… putting your entire retirement at risk, you may want to take another look in your inbox. Our own Dan Amoss has devised a plan for protecting your wealth… which could even triple every dollar between now and July. If these guys won’t get the job done… you’ll have to do it yourself.
To heck with the in-flight movie… grab a window seat
The pilot later officially reported seeing a black drone no wider than about 3 feet with four propellers… about 200 feet away from the plane. So far, no one even knows to whom the drone belongs. Nor what it was doing above JFK. At least “no one” is ready to publicly admit to owning it…
The Feds have now officially acknowledged they believe they have the authority to kill an American with a drone on American soil… but that they have no plan to do so right now. The pronouncement was made public yesterday in the form of a response from Attorney General Eric Holder to a letter from Sen. Rand Paul (R-Ky.).
“It is possible,” said Holder, “to imagine an extraordinary circumstance in which it would be necessary and appropriate under the Constitution and applicable laws of the United States for the president to authorize the military to use lethal force within the territory of the United States.”
But no worries, he adds: The question is “entirely hypothetical,” because “the U.S. government has not carried out drone strikes in the United States and has no intention of doing so.”
Holder’s reply is “more than frightening,” says a statement from Sen. Paul, “it is an affront on the constitutional due process rights of all Americans.”
“White House Trades Targeted-Killing Memos for a New CIA Director,” reads a pointed headline at Wired’s website. Apparently, the White House turned over top-secret legal memos about “targeted killing” policy to the Senate Intelligence Committee in hopes of speeding along John Brennan’s nomination as CIA director.
In turn, the committee duly approved Brennan’s nomination yesterday, 12-3.
What do the memos say? Sorry, only the senators and their staffs know. “It remains unclear,” reports Wired’s Spencer Ackerman, “whether the American people will get to read the memoranda that outline the Obama administration’s asserted authorities to potentially kill them without trial.”
Then again, Holder’s letter to Sen. Paul leaves little doubt.
In a related vein: “The U.S. Department of Homeland Security has customized its Predator drones,” reports CNET’s Declan McCullagh, “to carry out at-home surveillance tasks that have civil libertarians worried: identifying civilians carrying guns and tracking their cellphones.”
McCullagh got his hands on a DHS document spelling out its specs for the drones’ capabilities — insisting the craft “shall be capable of identifying a standing human being at night as likely armed or not.”
“They also specify,” McCullagh reports, “‘signals interception’ technology that can capture communications in the frequency ranges used by mobile phones, and ‘direction-finding’ technology that can identify the locations of mobile devices or two-way radios.”
“I am very concerned,” says Alan Gottlieb of the Second Amendment Foundation, “that this technology will be used against law-abiding American firearms owners.”
The combined weight of developments in the last 24 hours has prompted the petition team at the Laissez Faire Club to step up their efforts. “Today,” advises K. Garrett Smith, who’s been leading the charge on the drone issue, “we’ll send letters to all 100 senators urging them to reject the Intelligence Committee’s vote to approve Brennan.”
One of the petition’s key planks is that Brennan’s nomination to the CIA be rejected. A full Senate vote has yet to be scheduled… so there’s still a window of opportunity to make your voice heard. Take advantage while you still can.
“Chavez dealt with his illness the way he dealt with the country – in an improvised fashion,” said Dr. Jose Rafael Marquina of our favorite Latin American caudillo.
That was in December: It turns out Dr. Marquina — a Venezuelan living in Miami — accurately diagnosed Chavez’s cancer as terminal, without ever having met him face to face.
“Time and again,” reports the BBC’s Robert Plummer, “the president would make major decisions on an ad hoc basis, often during the course of his rambling and unscripted weekly TV broadcast to the nation, known as Alo Presidente…
“This fire-fighting approach continued even as Mr. Chavez lingered on his Cuban sickbed, with Vice President Nicolas Maduro implementing a 32% devaluation of the bolivar in February.”
He snapped this picture at a bookseller’s stall during a poetry festival in Granada, Nicaragua, a few years back:
“A postmortem best-seller?” he wonders. “I’m gonna miss our editorial jabbing at him. It was fun while it lasted. Adios, Hugo.”
So now what?
We kept half an eye on the death watch coverage yesterday afternoon via the BBC and Al-Jazeera English. Within an hour of Chavez’s passing, the defense minister appeared in fatigues, surrounded by other guys in fatigues, to assure — remind? — folks that everything was under control.
“U.S. Plots Conquest of Venezuela in Wake of Chavez’s Death,” reads an excitable headline at the Land Destroyer Report written by one Tony Cartalucci, “an American geopolitical analyst based in Bangkok, Thailand.”
Who knows, there might be something to it. The Bush administration made a ham-fisted attempt at regime change after the 2002 presidential elections. Hours before Chavez shed this mortal coil, the American Enterprise Institute was already out with “a post-Chavez checklist for U.S. policymakers.”
“As Venezuelan democrats wage that struggle against chavismo,” it said, “regional leaders must make clear that Syria-style repression will never be tolerated in the Americas.” Then again, this is a crowd that thinks the Obama administration isn’t doing enough to fight on the same side as al-Qaida in Syria.
In the meantime, oil has climbed down from the tiny spike it showed yesterday. Chavez’s underlings had stepped away from his deathbed long enough to kick a U.S. military attache out of the country.
West Texas Intermediate is only 17 cents away from breaking below $90.
The Dow is adding to yesterday’s (noninflation-adjusted) record high. At last check, it’s above 14,300. Other indexes, save the Nasdaq, are also in the green.
Fueling the rally — the ADP payroll report, which says private employers added 198,000 jobs last month.
“So is it too late for investors to join the party?” reads a too-predictable story in today’s New York Times. It points out the obvious — folks would have been better off buying at the bottom in March 2009 than now. (Gasp!)
“Nonetheless, for those willing to accept the risk, there are strong arguments, based on history and on market fundamentals, for believing that the bull market may still have room to run.”
Brace yourself: We agree! Even the Gray Lady acknowledges the Federal Reserve has propped up stock prices.
And then there’s the old cash-on-the-sidelines argument: “There are a lot of people who are still jumping in,” researcher Laszlo Birinyi tells the Times, “and that, in itself, is a good thing for the market.”
He didn’t say who “a lot of people” are, but let’s fill in the blanks: baby boomers who got burned by stocks in 2000-02… stayed out of stocks until about 2004-05… got burned again in 2007-09… and have stayed out until now. Of course, it’s time to pile in again!
Still, we don’t expect the next leg down to be as catastrophic as you might expect. We’ll show you why — and lay out four plays to bulletproof your portfolio — in the next Apogee Advisory. It’s slated for release on Tuesday… and, frankly, couldn’t be more timely in light of the Dow’s new highs. Here’s where to make sure you’ll get your issue as soon as it’s ready.
Precious metals are proving themselves the no-drama sector so far this week. Gold is stuck where it’s been all week, at $1,577. Silver is slowly creeping up toward $29.
“I find it amusing,” writes an amused reader, “that you are worried about the recycled water that the Mars astronauts will drink.
“Have you ever bothered to look at the wastewater/drinking water cycle for most places in the U.S.? Including all of the stuff that doesn’t get removed in the process? We should be so lucky as to have the water that will be on the Mars mission! Instead, we get to drink what is decreed by the Slime That Oozes Under the Capitol Dome (you call it Congress) and what the sheeple pooped into the Offal Office.”
“I’m not kidding,” writes a reader in all seriousness after Monday’s episode, in which readers offered suggestions for our D.C. Shake (-Down) viral video project. “Everyone who wrote to The 5 for this edition could write for The Onion! What a 5!”
The 5: Perhaps… but then maybe the SWAT team would come knocking.
You may recall the Capitol Police did just that after The Onion spoofed this repayment plan for the national debt: “Brandishing shotguns and semi-automatic pistols, members of the 112th U.S. Congress took a class of visiting schoolchildren hostage on Wednesday, barricading themselves inside the Capitol rotunda and demanding $12 trillion in cash.”
And who says the 112th has been the “least productive” Congress since 1941? They sound very enterprising in The Onion’s bright light.
The 5 Min. Forecast
P.S. About those “surveillance-only” drones… The Homeland Security document obtained by CNET specifies that “tracking accuracy should be sufficient to allow target designation.”
What’s more, Customs and Border Protection notes on its website that its Predator B drones are capable of “targeting and weapons delivery.” Indeed, there’s a military version that carries multiple Hellfire missiles, 100 pounds each.
A bellicose “Happy Birthday!” is in order for the Homeland Security department, by the way. It’s over a decade old this month.
“Here’s the strange thing:” The Nation observes, “Unlike the Pentagon, this monstrosity draws no attention whatsoever — even though, by our calculations, [the government] has spent a jaw-dropping $791 billion on ‘homeland security’ since Sept. 11. To give you a sense of just how big that is, Washington spent an inflation-adjusted $500 billion on the entire New Deal.”