Wednesday, July 1, 2009

Obama aide says no more troops to Afghanistan

(OBAMA, SECURITY, MILITARY, TROOPS, AFGHANISTAN, JONES)


Obama aide says no more troops to AfghanistanWASHINGTON (Reuters) - President Barack Obama`s top security adviser has told U.S. military commanders there are no plans to send more troops to Afghanistan for now and that the focus instead will be on economic development and reconstruction, The Washington Post reported on Tuesday.
National Security Adviser James Jones delivered that message last week in Afghanistan, where Marine Brigadier General Lawrence Nicholson hinted he could use more "thousands more" troops, the newspaper said.
Jones` message seemed designed to cap expectations that more troops might be coming, although the Obama administration has not ruled out additional deployments in the future, the Post said.
"This will not be won by the military alone," Jones told the Post during his trip. "We tried that for six years."
"The piece of the strategy that has to work in the next year is economic development. If that is not done right, there are not enough troops in the world to succeed."
An extra 17,000 troops Obama deployed to fight a growing Taliban-led insurgency in southern and western Afghanistan were expected to be on the ground by mid-July. Another 4,000 troops being deployed to train Afghan security forces are due to arrive by August.
The forces are part of a build-up that could expand the U.S. military presence in Afghanistan to 68,000 troops by the end of this year, more than double the 32,000 at the end of 2008.
The Post said Jones made it clear during his visit to Afghanistan that it was a new era and Obama will not automatically give military commanders whatever force levels they request, a departure from the practice of the Bush administration in the Iraq war.
(Editing by John O`Callaghan)
Original article

California misses budget deadline, readies "IOUs"

(CALIFORNIA, BUDGET, STATE, BILLION, SENATE, OBLIGATION)


California misses budget deadline, readies IOUsBy Jim Christie
SAN FRANCISCO (Reuters) - California`s lawmakers failed to agree on a balanced budget by the start of its new fiscal year on Wednesday morning, clearing the way to suspend payments owed to the state`s vendors and local agencies, who instead will get "IOU" notes promising payment.
The notes will mark the first time in 17 years the most populous U.S. state`s government will have to resort to the unusual and dramatic measure.
Democrats who control the legislature could not convince Republicans late on Tuesday night to back their plans to tackle a $24.3 billion budget shortfall or a stopgap effort to ward off the IOUs. The two sides agree on the need for spending cuts but are split over whether to raise taxes.
Democrats have pushed for new revenues while Republican lawmakers and Governor Arnold Schwarzenegger, also a Republican, have ruled out tax increases. They instead see deep spending cuts as the solution to balancing the budget, but Democrats say that would slash the state`s safety net for the needy to the bone.
Tempers flared in the state Senate as the midnight start of the new fiscal year neared.
"There is no excuse to hold this whole state hostage," state Senate President Pro Tem Darrell Steinberg told Republicans during a floor debate.
Senate Republican Leader Dennis Hollingsworth countered that major cuts are urgently needed. Otherwise, "There will be entire programs that will have to be lopped off," he said.
CASH CRISIS LOOMS
California lawmakers struggle with budget deadlines practically every year, but this year`s budget fight is taking place amid the state`s worst drop in revenues from personal income taxes since the Great Depression as recession and rising unemployment pile on to the damage done to the state`s economy from its long housing slump.
Because of its steep revenue decline, California risks running out of cash later this month to pay all of its bills unless its books are balanced quickly.
To conserve cash, State Controller John Chiang plans to issue IOUs by Thursday to the state`s vendors, local agencies overseeing health programs and various recipients of state aid -- including the elderly and disabled and college students.
He plans to send $3.36 billion in IOUs this month to help maintain $10.9 billion in other payments, including money owed to investors holding California`s general obligation debt.
"The general obligation bonds will be paid," Chiang told Reuters on Tuesday. "California has never defaulted on its debt obligation and we don`t plan to do so."
California aims to reassure investors because Wall Street`s concerns about the state`s finances are growing and because state officials see the need to sell $7 billion to $9 billion in short-term debt for cash-flow purposes once there is a budget agreement.
Fitch Ratings last week downgraded its rating on California`s general obligation debt and warned it may lower the rating again. Fitch cut California`s rating by one notch to A-minus, placing it four notches above speculative, or "junk" status, and making it the lowest rating of any U.S. state.  Continued...
Original article

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U.S. targets North Korea`s missile, nuclear activities

(NORTH, KOREA, NUCLEAR, TREASURY, ELECTRONICS, WHICH)


U.S. targets North Korea`s missile, nuclear activitiesWASHINGTON (Reuters) - The United States said on Tuesday it had cracked down on companies involved in North Korea`s suspected missile proliferation and in purchases of equipment that could be used in a nuclear weapons program.
The Treasury and State Departments said they had targeted Iran`s Hong Kong Electronics and North Korea`s Namchongang Trading Corporation under an executive order that would freeze their U.S. assets and bar U.S. firms from dealing with them.
The move appeared aimed at isolating the companies from the U.S. financial and commercial systems and, by extension, from other countries` banks and corporations who may resist doing business with them out of fear of falling afoul of U.S. laws.
It was immediately not clear whether either company actually has any U.S. assets that could be frozen.
The steps are part of an effort to get tough with North Korea, which conducted its second nuclear test this year and which has ceased carrying out a 2005 agreement to abandon its nuclear programs in exchange for economic and diplomatic benefits.
The U.S. Treasury said that it had targeted Hong Kong Electronics, which is located in Kish Island, Iran, because it had transferred millions of dollars of proliferation-related funds to North Korea from Iran.
"North Korea uses front companies like Hong Kong Electronics and a range of other deceptive practices to obscure the true nature of its financial dealings, making it nearly impossible for responsible banks and governments to distinguish legitimate from illegitimate North Korean transactions," Stuart Levey, undersecretary of the treasury for terrorism and financial intelligence, said in the statement.
The State Department described Namchongang as a Pyongyang-based "nuclear-related company" and said it has been involved in the purchase of aluminum tubes and other equipment "specifically suitable for a uranium enrichment program since the late 1990s."
Uranium enrichment is a process that can produce fuel for nuclear power plants or for nuclear weapons.
(Editing by Philip Barbara)
Original article
 

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