Thursday, December 1, 2011

Merkel Shuns ECB Role in Favor of Budget Limits



German Chancellor Angela Merkel is set to snub investor pleas to back an expanded European Central Bank role in solving the debt crisis, as she pushes her demand for tighter economic ties in Europe as the only way forward.

In the days before a speech to German lawmakers tomorrow outlining her stance for a Dec. 9 European summit, Merkel has repeated her push to rework European Union rules to lock in budget monitoring and enforcement and seal off the ECB from political pressure. That risks a showdown with fellow EU leaders and extends her conflict with financial markets looking for immediate measures to end the contagion.

"The market is questioning Merkel's tough approach," Jacques Cailloux, chief European economist at Royal Bank of Scotland Group Plc in London, said by phone today. Investors want "clarity on what the framework will look like and what the financial bridge will look like" to fund euro-area governments and banks that need aid while fiscal ties are negotiated.

Merkel's refusal to deploy the ECB is a rebuff to President Barack Obama after he exhorted Europe's leaders to take more action to combat the crisis. The chancellor is loath to agree to follow the Federal Reserve and the Bank of England in policies she views as akin to fighting debt with more debt. Enlisting the ECB in battling the crisis would violate the central bank's independence and set it on a course of action that might not work, destroying its credibility.

'Damaging' Solution

The ECB is independent and must choose its own method of ensuring the euro's stability "without being praised or criticized" and states must protect that independence by improving their finances, the Westdeutsche Zeitung quoted Merkel as saying in an interview released today. The government sees joint euro bonds as "the wrong remedy in this phase of European development and even damaging," she told the newspaper.


Occupy L.A. Protesters Plan Smaller Camps at Banks, Country Clubs

LOS ANGELES (KTLA) -- With the 'Occupy L.A.' encampment at City Hall over, organizers say they will not be silenced and are planning future protests.

Organizers say more short-lived encampments might spring up at various locations, including banks, the homes of bank executives, or even golf courses and country clubs.

The leaders of 'Occupy L.A.' issued this statement on Wednesday:

"We call upon all sisters and brothers of the occupy movement to speak out against the use of intimidation, force and political power to break up peaceful occupations and repress or criminalize the exercise of our 1st Amendment rights."

A group of about 100 protesters have gathered at City Hall Wednesday evening. The protesters marched from Pershing Square to City Hall.

LAPD officers set up a skirmish line around City Hall as a precaution, but the protest was peaceful. Southbound Spring Street, however, was closed to traffic during the march.

Meantime, the National Lawyers Guild is calling for the immediate release of the nearly 300 protesters arrested in the police raid of Occupy L.A. early Wednesday morning.

The NLG says California law mandates that anyone charged with a misdemeanor be released with a written notice to appear.

NLG Board Member Carol Sobel condemned the action of the LAPD.


Clinton 'encouraged' by Burma reforms as she meets Aung San Suu Kyi


Hillary Clinton and Aung San Suu Kyi
Hillary Clinton and Aung San Suu Kyi met in Rangoon. Photograph: Saul Loeb/AP

Aung San Suu Kyi, the Burmese pro-democracy campaigner and Nobel prize winner, had dinner with US secretary of state Hillary Clinton on Thursday night in a diplomatic residence in the port city of Rangoon.

The extraordinary meeting came at the end of Clinton's first full day of her historic trip to the isolated south Asian state, the first by a top-ranking American official for more than 50 years.

Earlier she met the new president, Thein Sein, and senior officials in Naypyidaw, the country's recently constructed capital.

"I am here today because President Obama and myself are encouraged by the steps you and your government have taken to provide for your people," Clinton told Thein Sein as the two sat down for talks in the vast – and apparently largely empty – presidential palace.

Thein Sein, who has led a nominally civilian administration since March, welcomed Clinton on a visit he said would be a "milestone".

"Your excellency's visit will be a new chapter in relations," he said.

Clinton's trip comes after changes in Burma that have astonished many observers. Aung San Suu Kyi has been freed after more than 20 years of house arrest and prison, and tentative moves have been made to reduce censorship and create new laws permitting limited political demonstrations.

Last year saw parliamentary elections which, despite being rigged to give the pro-regime party a huge majority, were nonetheless welcomed by observers.

Though the military dominates most institutions and much of the economy, many senior figures believe Burma, currently under US and European Union sanctions, needs to reintegrate the international community, analysts say.






Pakistan may discontinue its support of the U.S.-led war on terrorism if its sovereignty is violated again, a top official said Thursday in the latest sign of the country's continuing outrage over a deadly NATO airstrike on a Pakistani military outpost last week.

"Enough is enough. The government will not tolerate any incident of spilling even a single drop of any civilian or soldier's blood," Foreign Minister Hina Rabbani Khar told Pakistan lawmakers, according to The News newspaper.

"Pakistan's role in the war on terror must not be overlooked," Khar said.

Twenty-four Pakistani soldiers died Saturday after a joint U.S.-Afghan patrol called in an airstrike along the Afghanistan-Pakistan border. NATO is investigating the apparent friendly fire incident, but the two sides have differed over the sequence of events. The NATO force reported coming under fire before requesting the strike, and a preliminary U.S. military report suggests Taliban fighters may have lured the coalition patrol into the area.

Pakistan calls for change in partnership with U.S.
NATO: Pakistan cooperates in new border raid

Pakistani officials have insisted the attack was unprovoked. Officials also claim the strikes continued for two hours despite alerting NATO that it was targeting the outpost.

American and NATO officials have expressed sympathy over the deaths, saying the incident was a mistake. The border area is infested with militants, whom NATO has long complained receive safe haven on the Pakistan side to launch attacks in Afghanistan.

The border incident has greatly strengthened anti-American sentiment, reducing the political space for those who argue that cooperation with Washington is in the country's interest. The army, which has received billions of dollars in U.S. aid since 2001 in exchange for its cooperation, however limited, against militants, has fueled the hard line by accusing NATO of a "deliberate act of aggression."


Treasury announces new sanctions against Syria


On the heels of action taken by the Arab League, Turkey and European Union, the Treasury Department on Thursday announced new sanctions against Syria and urged more pressure against Bashar al-Assad's regime.

Treasury named Muhammad Makhluf, an uncle of Syrian President Bashar Al-Assad, and Aus Aslan, top general in the Syrian military. Under the terms of the sanctions, Americans are banned from any dealings with them.

"It has never been more critical to escalate pressure on the Syrian government to immediately cease all violence against its own people and isolate the regime from the international financial system," David Cohen, Treasury's undersecretary for terrorism and financial intelligence, said in a statement. "We will continue to work closely with our partners in Europe and around the world to hasten a transition to democracy in Syria."

Treasury also listed the Military Housing Establishment as a Syrian government-controlled company that provides financing to the regime and Real Estate Bank, which handles borrowing for the government.

The Treasury Department sanctions come one day after Turkey announced a freeze on Syrian assets in Turkey and a ban on transactions with the Syrian central bank. The EU and Arab League also levied a series of sanctions against Damascus earlier this week.