Obama to Pledge New Mideast Aid

Obama to Pledge New Mideast Aid

By CAROL E. LEE                And JAY SOLOMON

WASHINGTON—President Barack Obama will announce this week a new aid plan for the Middle East and North Africa that U.S. officials say will be far bolder than previous American economic assistance to the region.

Mr. Obama will outline the plan, which could include debt cancellation and a reprogramming of financial aid the U.S. already provides to countries like Egypt, in a speech he is scheduled to deliver Thursday at the State Department.

[obama0519]European Pressphoto AgencyPresident Obama

Whatever aid he announces, though, is unlikely to assuage Arab governments, which had been hoping the White House would push forcibly for a resumption of Palestinian-Israeli peace talks. The president’s aides say his speech will focus only briefly on the issue.

“At the end of the day, the Palestinian cause remains a dominant issue,” said a senior Arab official. “A speech by the president without addressing the conflict is unlikely to generate much enthusiasm.”

Mr. Obama met Tuesday with King Abdullah II of Jordan, who has been pressing U.S. officials to take a more aggressive role in the peace process, according to Arab diplomats.

After the meeting, Mr. Obama said the U.S. will provide Jordan with hundreds of millions of dollars through the Overseas Private Investment Corporation, the government institution that finances and insures private business to promote economic growth. The result, according to the U.S., will be roughly $1 billion for economic activity in Jordan. The president also pledged 50,000 metric tons of wheat.

“All of this will help to stabilize the cost of living and day-to-day situation of Jordanians and will provide a foundation so that these economic reforms can move forward and long-term development can take place,” Mr. Obama said.

The president’s goal, officials said, is to give a financial boost to the political change sweeping the Mideast and North Africa, where dashed economic aspirations have fed unrest.

Senior U.S. officials are particularly alarmed by the deterioration in Cairo’s finances since the street revolt that ousted President Hosni Mubarak in February. The Egyptian government has been forced to spend between $3 billion and $3.5 billion of its foreign-exchange reserves a month to pay for food and other commodities as tourism has plunged and overseas remittances have dried up.

Egypt’s government has been seeking relief on around $1 billion in debts tied to wheat purchases in the 1970s, according to officials involved in the talks. Cairo has paid off the principal on these loans, but continues to service interest payments.

The administration is looking at a mixture of direct aid, debt relief, and export credits to help stabilize Egypt’s finances. “There are a whole range of tools we could use,” said a U.S. official. “We’ve been looking for the right mix.”

Mr. Obama’s speech will come ahead of action on economic and trade initiatives that the Group of Eight economic powers are poised to take during their summit in France next week. Leaders are working on a short-term stabilization package, particularly for Egypt and Tunisia, that would involve international financial institutions and perhaps some of the Persian Gulf states, according to a G-8 diplomat.

The diplomat said G-8 member countries may also change trade policies to help boost regional exports to Europe and the U.S., perhaps using the European Bank for Reconstruction and Development, which was set up after the Cold War to help former East Bloc nations.

Mr. Obama may struggle to win over skeptics in Congress. The U.S. already provides Egypt with roughly $1.3 billion a year, and lawmakers are pushing the White House for deep spending cuts.

Additionally, a number of lawmakers have raised concerns in recent weeks about Egypt’s post-Mubarak foreign policy, particularly its warming relations with Iran and militant Palestinian group Hamas, which the U.S. and the European Union designate as a terrorist entity.

Mr. Obama’s speech comes a day before the president is set to meet with Israeli Prime Minister Benjamin Netanyahu in Washington. After meeting with King Abdullah, Mr. Obama said “it’s more vital than ever that both Israelis and Palestinians find a way to get back to the table.”

In the speech, Mr. Obama will seek to connect the death of Osama bin Laden with the popular uprisings across the Middle East and North Africa.

“The Arab Spring represents a real and organic repudiation of the things bin Laden stood for in the region and among the people he claimed to represent,” a senior administration official said Tuesday, previewing one of the speech’s themes.

There will be no new policy on the Mideast peace process in the speech, but Mr. Obama is likely to address the union of the Palestinian Fatah and Hamas factions, the official said, and to say Hamas must reject terrorism and recognize Israel’s right to exist if it wants to be part of the Palestinian government.

The president is also expected to refer to the pending effort to have the United Nations recognize a Palestinian state. He plans to restate U.S. policy that the conflict should be settled through negotiations, not by a declaration.

—Laura Meckler contributed to this article.Write to                 Jay Solomon at jay.solomon@wsj.com

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President to Renew Muslim Outreach

President to Renew Muslim Outreach

By JAY SOLOMON                And CAROL E. LEE

WASHINGTON—President Barack Obama is preparing a fresh outreach to the Muslim world in coming days, senior U.S. officials say, one that will ask those in the Middle East and beyond to reject Islamic militancy in the wake of Osama bin Laden’s death and embrace a new era of relations with the U.S.

MOHAMMED HUWAIS/Agence France-Presse/Getty ImagesProtesters in Yemen Tuesday continue demonstrations demanding the resignation of President Ali Abdullah Saleh.

USMIDEASTjp

USMIDEASTjp

Mr. Obama is preparing to deliver that message in a wide-ranging speech, perhaps as early as next week, these officials say. The president intends to argue that bin Laden’s death, paired with popular uprisings sweeping North Africa and the Middle East, signal that the time has come to an end when al Qaeda could claim to speak for Muslim aspirations.

“It’s an interesting coincidence of timing—that he is killed at the same time that you have a model emerging in the region of change that is completely the opposite of bin Laden’s model,” Ben Rhodes, deputy national security adviser at the White House, said in an interview.

Since January, popular uprisings have overthrown the longtime dictators of Tunisia and Egypt. They have shaken rulers in Libya, Bahrain, Syria, Yemen and Jordan, marking the greatest wave of political change the world has seen since the fall of the Berlin Wall.

But the push for democracy appears to have stalled in some countries. The street protests against Libyan leader Moammar Gadhafi have morphed into a civil war, with North Atlantic Treaty Organization backing the rebels. Syrian President Bashar al-Assad and Bahrain’s ruling Khalifa family have both met demonstrations with violence.

Bin Laden’s death gives Mr. Obama a chance to underscore the belief among many administration officials that the terror leader’s relevance had already begun to diminish during the so-called Arab Spring. Mr. Obama, who has made outreach to the Muslim world a cornerstone of his presidency, plans to describe the Islamic world as at a crossroads, said U.S. officials, making the case that bin Laden represented a failed approach of the past while populist movements brewing in the Middle East and North Africa represent the future.

Mr. Rhodes said timing of the speech remains in flux but Mr. Obama could deliver it before leaving on a five-day trip to Europe on May 23. The White House is already telegraphing the message of the coming speech to the Islamic world by placing American diplomats on Arab television and radio, according to U.S. officials.

The White House is still debating, however, whether Mr. Obama should lay out a concrete plan for revitalizing the stalled Arab-Israeli peace process.

Many Arab governments have been pressing Mr. Obama to publicly outline his own parameters for the creation of an independent Palestinian state as a way to exert more pressure on Israeli Prime Minister Benjamin Netanyahu, who visits Washington next week. These diplomats said the Mideast’s democratic surge is raising expectations among their own populations for an end to the decades-old Arab-Israeli conflict.

White House officials said they are still reassessing the monumental changes in the Middle East and whether an aggressive U.S. push to resume peace talks would likely be successful.

Last week, Palestinian President Mahmoud Abbas forged a unity government with the militant group Hamas, which the U.S. and European Union designate a terrorist group. Israeli officials have already cited Hamas’s role in the Palestinian Authority as the reason why Mr. Netanyahu is unlikely to unveil any major new overtures to the Palestinians during his Washington trip.

“We need to sort through these issues as we consider the next steps on a peace process,” Mr. Rhodes said. The May 20 Obama-Netanyahu meeting “is a chance for the U.S. and Israel to review the full range of issues, from Iran to the regional change to the peace process.”

Arab officials and Mideast peace advocates say there are major risks for the U.S. and Israel in delaying a return to talks.

Mr. Abbas is pressing the United Nations to recognize an independent Palestinian state during the September gathering of the General Assembly. He has specifically cited his frustration with the lack of progress in negotiations with Mr. Netanyahu, as well as the rising expectations among his own people as a result of the Arab Spring.

“There’s clearly a lot going on in the region, and there’s a case to be made and some are making it, that now is not the time,” said Jeremy Ben-Ami, founder of J-Street, a U.S. lobbying group that advocates Washington laying out its own peace plan, something Israel’s government opposes. “But we do believe that the only way to avoid U.N. action on a Palestinian state in a unilateral kind of way is for either the president or prime minister to put forward” a peace plan.

A number of lawmakers have cited Hamas’s new alliance with Mr. Abbas as reason for the White House to move slowly in restarting the peace process. Mr. Netanyahu is scheduled to address a joint session of Congress during his Washington visit as well the annual conference of the American Israel Public Affairs Committee, the U.S.’s most powerful pro-Israel lobby.

Avigdor Lieberman, Israel’s foreign minister, on Tuesday broke with Israel’s policy of keeping quiet on the regional turmoil, saying the international community’s response to repression of demonstrations in Syria, Lybia and Yemen has been “inconsistent” and “confusing.” In remarks delivered before Mr. Netanyahu’s scheduled White House visit, Mr. Lieberman added that the confusion sends a “damaging message to the people of the Middle East, and further erodes the path to peace, security and democracy for our region.”

Mr. Obama is also scheduled to meet Jordan’s King Abdullah II in Washington next week. The Arab monarch has been at the forefront of Mideast leaders calling for the U.S. to impose its own peace plan on the Israelis and Palestinians. Jordan’s population is 60% Palestinian, and the king has faced his own popular protests in recent months.

Internet Gets New Rules of the Road

Internet Gets New Rules of the Road

Consumers Guaranteed Right to View Content; Service
Providers Allowed to Sell Faster, Priority Speeds for Extra Money

By AMY SCHATZ And SHAYNDI RAICE

WASHINGTON—Consumers for the first time got federally
approved rules guaranteeing their right to view what they want on the Internet.
The new framework could also result in tiered charges for web access and alter
how companies profit from the network.

The Federal Communications Commission on Tuesday voted
3-2 to back Chairman Julius Genachowski’s plan for what is commonly known as
“net neutrality,” or rules prohibiting Internet providers from
interfering with legal web traffic. President Barack Obama said the FCC’s
action will “help preserve the free and open nature of the Internet.”

The move was prompted by worries that large phone and
cable firms were getting too powerful as Internet gatekeepers.

Most consumers haven’t had a problem viewing whatever
they want online; few instances have arisen of an Internet provider blocking or
slowing services.

Rather, the FCC rules are designed to prevent potential
future harms and they could shape how Americans access and use the Internet
years from now. In the future, the Internet industry will be increasingly
centered around the fastest-growing categories of Internet traffic—online
video, gaming and mobile services, analysts say. Cisco Systems Inc., the
broadband network provider, has forecast those services could quadruple by
2014.

The
FCC has approved rules that would give the federal government authority to
regulate Internet traffic and prevent broadband providers from selectively
blocking web traffic. WSJ’s Amy Schatz explains what the new rules really mean.

Comcast Corp. and other Internet providers have
experimented with ways to handle the growing problem of network congestion.
Recently, Mr. Genachowski suggested that instead of selectively slowing certain
traffic to cope with congestion, providers could consider charging consumers
for how much data they consume. That would be a departure from the flat monthly
fees consumers pay now for Web access. It’s something providers privately say
is one of the only ways to make a profit and fund network infrastructure.

·
Such a system could
pose a challenge to companies like Netflix Inc., which streams movies over
broadband networks to

Public Interest Groups Want Tighter Wireless Provisions

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The new rules will also allow phone and cable companies
to sell to Internet companies like Amazon.com Inc. faster data delivery for
extra money, particularly on wireless networks. That would let a company that
offers streaming video, like Google Inc.’s YouTube, pay a wireless company like
Verizon Communications Inc. a bonus for guaranteed delivery of its videos to
consumers’ smart phones.

But FCC officials said any such priority service must be
disclosed, and they said they would likely probe and reject such efforts. That
could prompt some of the many expected legal challenges to the new rules, since
it is not clear if the FCC has authority to enforce them.

Consumer groups and other organizations, including the
American Library Association, oppose such high-speed toll lanes, arguing all
Americans should have the same quality of Internet access.

  • The FCC’s decision is
    a mixed bag for consumers. The new rules—which haven’t been released in
    full—say that land-line broadband providers can’t block legal content from
    websites, or “unreasonably discriminate” against companies like Skype
    or Netflix that want to use broadband networks to provide video or voice
    services. They also require providers to give consumers

But the rules come with some wiggle room for the
industry. Service providers will be allowed to engage in “reasonable
network management” to cope with congestion on their systems.

Wireless companies are less restricted by the new rules—a
win for the industry because consumers are increasingly accessing the web using
hand-held devices such as iPhones or Blackberries. Mr. Genachowski said mobile
carriers faced more congestion issues than other companies and need more leeway
to manage their networks.

Wireless companies would be prohibited from blocking
Internet voice services but they could block access to many other applications,
citing congestion issues.

Reaction the FCC’s rules was mixed. AT&T Inc. said
the rules were “not ideal” but would bring some “market
certainty so that investment and job creation can go forward.” Verizon
said it was “deeply concerned” because it didn’t think the rules were
needed. A coalition of Internet companies including Google said the rules were
a good first step but stronger regulations on wireless networks were needed to
ensure the same rules apply to both wired and wireless Internet.

View Full Image

Bloomberg News

Steve
Wozniak, a co-founder of Apple Inc. and a staunch proponent of keeping the
Internet unregulated, after an FCC hearing on Tuesday.

 

Some venture capital firms that invest in innovative
applications and wireless technology expressed concern about how the rules will
impact the wireless business. “The problem is that there’s so much
ambiguity in the rules,” said Brad Burnham of Union Square Ventures, which
has invested in startups including Foursquare and Twitter Inc.

New U.S. Push to Regulate Internet Access

New U.S. Push to Regulate Internet Access

WASHINGTON—In a move that will stoke a battle over the future of the Internet, the federal government plans to propose regulating broadband lines under decades-old rules designed for traditional phone networks. 

The decision, by Federal Communications Commission Chairman Julius Genachowski, is likely to trigger a vigorous lobbying battle, arraying big phone and cable companies and their allies on Capitol Hill against Silicon Valley giants and consumer advocates. 

Breaking a deadlock within his agency, Mr. Genachowski is expected Thursday to outline his plan for regulating broadband lines. He wants to adopt “net neutrality” rules that require Internet providers like Comcast Corp. and AT&T Inc. to treat all traffic equally, and not to slow or block access to websites. 

The decision has been eagerly awaited since a federal appeals court ruling last month cast doubt on the FCC’s authority over broadband lines, throwing into question Mr. Genachowski’s proposal to set new rules for how Internet traffic is managed. The court ruled the FCC had overstepped when it cited Comcast in 2008 for slowing some customers’ Internet traffic. 

In a nod to such concerns, the FCC said in a statement that Mr. Genachowski wouldn’t apply the full brunt of existing phone regulations to Internet lines and that he would set “meaningful boundaries to guard against regulatory overreach.” 

Some senior Democratic lawmakers provided Mr. Genachowski with political cover for his decision Wednesday, suggesting they wouldn’t be opposed to the FCC taking the re-regulation route towards net neutrality protections. 

Getty ImagesFCC Chairman Julius Genachowski, whose authority over broadband lines has been questioned by a federal court, plans to use regulation on traditional phone networks to establish rules for Internet providers. 

FCC

FCC

“The Commission should consider all viable options,” wrote Sen. Jay Rockefeller (D, W.V.), chairman of the Senate Commerce Committee, and Rep. Henry Waxman (D, Calif.), chairman of the House Energy and Commerce Committee, in a letter. 

At stake is how far the FCC can go to dictate the way Internet providers manage traffic on their multibillion-dollar networks. For the past decade or so, the FCC has maintained a mostly hands-off approach to Internet regulation. 

Internet giants like Google Inc., Amazon.com Inc. and eBay Inc., which want to offer more Web video and other high-bandwidth services, have called for stronger action by the FCC to assure free access to websites. 

Cable and telecommunications executives have warned that using land-line phone rules to govern their management of Internet traffic would lead them to cut billions of capital expenditure for their networks, slash jobs and go to court to fight the rules. 

Consumer groups hailed the decision Wednesday, an abrupt change from recent days, when they’d bombarded the FCC chairman with emails and phone calls imploring him to fight phone and cable companies lobbyists. 

“On the surface it looks like a win for Internet companies,” said Rebecca Arbogast, an analyst with Stifel Nicolaus. “A lot will depend on the details of how this gets implemented.” 

Mr. Genachowski’s proposal will have to go through a modified inquiry and rule-making process that will likely take months of public comment. But Ms. Arbogast said the rule is likely to be passed since it has the support of the two other Democratic commissioners. 

President Barack Obama vowed during his campaign to support regulation to promote so-called net neutrality, and received significant campaign contributions from Silicon Valley. Mr. Genachowski, a Harvard Law School buddy of the president, proposed new net neutrality rules as his first major action as FCC chairman. 

Telecom executives say privately that limits on their ability to change pricing would make it harder to convince shareholders that the returns from spending billions of dollars on improving a network are worth the cost. 

Carriers fear further regulation could handcuff their ability to cope with the growing demand put on their networks by the explosion in Internet and wireless data traffic. In particular, they worry that the FCC will require them to share their networks with rivals at government-regulated rates. 

Mike McCurry, former press secretary for President Bill Clinton and co-chair of the Arts + Labs Coalition, an industry group representing technology companies, telecom companies and content providers, said the FCC needs to assert some authority to back up the general net neutrality principles it outlined in 2005. 

“The question is how heavy a hand will the regulatory touch be,” he said. “We don’t know yet, so the devil is in the details. The network operators have to be able to treat some traffic on the Internet different than other traffic—most people agree that web video is different than an email to grandma. You have to discriminate in some fashion.” 

UBS analyst John Hodulik said the cable companies and carriers were likely to fight this in court “for years” and could accelerate their plans to wind down investment in their broadband networks. 

“You could have regulators involved in every facet of providing Internet over time. How wholesale and prices are set, how networks are interconnected and requirements that they lease out portions of their network,” he said. 

—Niraj Sheth, Spencer E. Ante, Sara Silver and Nat Worden contributed to this article.

Liberals and the Violence Card—-Conservative protest is motivated by a love of what America stands for.

  • The Wall Street Journal 
    • APRIL 23, 2010

    Liberals and the Violence Card

    Conservative protest is motivated by a love of what America stands for.

     

    By RUSH LIMBAUGH

    The latest liberal meme is to equate skepticism of the Obama administration with a tendency toward violence. That takes me back 15 years ago to the time President Bill Clinton accused “loud and angry voices” on the airwaves (i.e., radio talk-show hosts like me) of having incited Oklahoma City bomber Timothy McVeigh. What self-serving nonsense. Liberals are perfectly comfortable with antigovernment protest when they’re not in power.

    From the halls of the Ivy League to the halls of Congress, from the antiwar protests during the Vietnam War and the war in Iraq to the anticapitalist protests during International Monetary Fund and World Bank meetings, we’re used to seeing leftist malcontents take to the streets. Sometimes they’re violent, breaking shop windows with bricks and throwing rocks at police. Sometimes there are arrests. Not all leftists are violent, of course. But most are angry. It’s in their DNA. They view the culture as corrupt and capitalism as unjust.

    Associated PressFormer President Bill Clinton smiles as he receives a medallion from Cathy Keating, wife of former Oklahoma Governor Frank Keating, as a part of the Reflections of Hope Award ceremony in Oklahoma City.

    Clinton

    Clinton

    Now the liberals run the government and they’re using their power to implement their radical agenda. Mr. Obama and his party believe that the election of November 2008 entitled them to make permanent, “transformational” changes to our society. In just 16 months they’ve added more than $2 trillion to the national debt, essentially nationalized the health-care system, the student-loan industry, and have their sights set on draconian cap-and-trade regulations on carbon emissions and amnesty for illegal aliens.

    Had President Obama campaigned on this agenda, he wouldn’t have garnered 30% of the popular vote.

    Like the millions of citizens who’ve peacefully risen up and attended thousands of rallies in protest, I seek nothing more than the preservation of the social contract that undergirds our society. I do not hate the government, as the left does when it is not running it. I love this country. And because I do, I insist that the temporary inhabitants of high political office comply with the Constitution, honor our God-given unalienable rights, and respect our hard-earned private property. For this I am called seditious, among other things, by some of the very people who’ve condemned this society?

    Former President Bill Clinton broadened his warning that Tea Party protesters could fuel violence reminiscent of the Oklahoma City bombing. Video courtesy of Fox News.

    I reject the notion that America is in a well-deserved decline, that she and her citizens are unexceptional. I do not believe America is the problem in the world. I believe America is the solution to the world’s problems. I reject a foreign policy that treats our allies like our enemies and our enemies like our allies. I condemn the president traveling the world apologizing for America’s great contributions to mankind. And I condemn his soft-pedaling the dangers we face from terrorism. For this I am inciting violence?

    Few presidents have sunk so low as Mr. Clinton did with his accusations about Oklahoma City. Last week—on the very day I was contributing to and raising more than $3 million to fight leukemia and lymphoma on my radio program—Mr. Clinton used the 15th anniversary of that horrific day to regurgitate his claims about talk radio.

    At a speech delivered last Friday at the Center for American Progress in Washington, D.C., the former president said: [T]here were a lot of people who were in the business back then of saying that the biggest threat to our liberty and the cause of our domestic economic problem was the federal government itself. And we have to realize that there were others who fueled this both because they agreed with it and because it was in their advantage to do so. . . . We didn’t have blog sites back then so the instrument of carrying this forward was basically the right-wing radio talk show hosts and they understand clearly that emotion was more powerful than reason most of the time.”

    Timothy McVeigh was incensed by the Clinton administration’s 1993 siege on the Branch Davidian compound in Waco, Texas. It’s no coincidence that the bombing took place two years to the day of the Waco siege. McVeigh was not inspired by anything I said or believe and to say otherwise is outright slander. In the aftermath of the bombing, I raised millions of dollars for the children of federal employees killed in that cowardly attack through my association with the Marine Corp Law Enforcement Foundation.

    Let me just say it. The Obama/Clinton/media left are comfortable with the unrest in our society today. It allows them to blame and demonize their opponents (doctors, insurance companies, Wall Street, talk radio, Fox News) in order to portray their regime as the great healer of all our ills, thus expanding their power and control over our society.

    A clear majority of the American people want no part of this. They instinctively know that the Obama way is not how things get done in this country. They are motivated by love. Not hate, not sedition. They love their country and want to save it from those who do not.

    Mr. Limbaugh is a nationally syndicated radio talk-show host.

     

     

     

     

    IN YOUR FACE: OBAMA STEPS UP CONFRONTATIONS

    By JONATHAN WEISMAN

    [OBAMA]President Obama arrived Monday in Maryland from Afghanistan.

    President Barack Obama, after a year of fitfully searching for compromise, is taking a more aggressive tack with his Republican adversaries, hoping to energize Democratic voters and possibly muscle in some Republican support in Congress.

    On Thursday, the president challenged Republicans who planned to campaign on repealing his health-care bill with, “Go for it.” Two days later, he made 15 senior appointments without Senate consent, including a union lawyer whose nomination had been blocked by a filibuster.

    At a bill-signing event Tuesday, he is set to laud passage of higher-education legislation that was approved despite Republican objections through a parliamentary maneuver that neutralized the party’s filibuster threat.

    On Thursday, Mr. Obama will be in Maine, home state of two moderate Republican senators who opposed his health-care plan, to promote the health law.

    Even his surprise trip to Afghanistan on Sunday mobilized the perks of the presidency to marshal public opinion, as pictures were beamed home of Mr. Obama mobbed by U.S. troops.

    A senior Democratic official said the push was a textbook case of taking advantage of political momentum as the campaign season begins. Republicans are “on the defensive,” the official said, “and as long as they’re not cooperating, we ought to keep them there.”

    Republicans say Mr. Obama’s overtures to them have been for show, whether it was his January meeting with House Republicans in Baltimore or last month’s televised, bipartisan health-care summit.

    The partisanship “may be more visible, and he may be more resolute about it, but as far as most of us are concerned, this is business as usual,” said Tennessee Sen. Lamar Alexander, a member of the Republican leadership.

    But Mr. Alexander said the recent moves are broader, more public swipes that will hurt the president in the end.

    He conceded that Republican leaders have tried to maintain unity in opposition. “When you have 40 Republicans, with your back against the wall and the gallows are right in your face, you’re going to do your best to be unified,” Mr. Alexander said.

    The onus, however, is on the president to build relationships with minority leaders, Mr. Alexander said.

    “If you’re the president or a governor and you don’t have a good relationship with the other party, that’s your problem to solve,” he said.

    Mr. Obama campaigned on calling for an end to partisan bickering in Washington, but once in office he launched an ambitious agenda that pursued several long-held Democratic goals.

    Meanwhile, Republicans decided at an early stage to aggressively oppose most of Mr. Obama’s agenda. Partisan tensions have run high for most of his term.

    Recently, Mr. Obama has been swinging particularly hard. He followed up his “go for it” taunt Thursday with the recess appointment of union lawyer Craig Becker to the National Labor Relations Board, adopting a tactic that presidents of both parties have used in recent decades to skirt the normal confirmation process. Mr. Becker’s confirmation had been blocked in the Senate by a filibuster in February.

    On Tuesday, Mr. Obama will sign what has been billed as a package of fixes to the health-care bill, approved under rules that required only a simple majority vote to pass in the Senate. That nullified Republicans’ power to block it through a filibuster.

    Democrats attached to the bill a major overhaul of student-lending laws, which eliminated a federal subsidy for private tuition lenders, federalized most student loans and plowed the savings into expanded federal higher education aid. Republicans say the bill will destroy the private student-lending market.

    Mr. Alexander, the Tennessee Republican, called the student-loan move “really brazen” and “the most underreported, biggest Washington takeover in history.”

    In classic game theory, confrontation is sometimes necessary when cooperation breaks down to present a credible potential threat and get the two sides to re-engage, said Robert Axelrod, a University of Michigan political scientist and author of the game-theory book, “The Evolution of Cooperation.” He isn’t related to White House senior adviser David Axelrod.

    The Senate doesn’t work the way game theorists think, said Antonia Ferrier, an aide to Republican Sen. Orrin Hatch of Utah. A body built on personal relationships is likely to spiral into endless tit-for-tat retaliations in the face of Mr. Obama’s new turn, she said.

    The new tone may be having an impact, though, among some Obama voters who had soured on what they saw as an electric campaigner gone soft.

    Republicans are getting “better treatment than they deserve,” said Don Miller, 68, a California independent and pipe line consultant who said his support for Mr. Obama was rising.

    “He’s not a politician yet, but he’s learning fast. As he learns to work the Washington establishment he has become more and more effective,” said James Shubert, 83, a transportation-services manager in Tennessee.

    Robin Moyer, 48, a retired South Carolina school teacher, lamented that the president had been trying to “reach as many people as possible, but sometimes it is overkill.”

    —Jean Spencer contributed to this article.

    Write to Jonathan Weisman at jonathan.weisman@wsj.com

    Palin Makes Fans Uneasy by Backing McCain Tea Party Favorite Heads to Arizona to Help Running Mate Battle a Primary Challenge From Immigration Foe Hayworth

    Palin Makes Fans Uneasy by Backing McCain

    Tea Party Favorite Heads to Arizona to Help Running Mate Battle a Primary Challenge From Immigration Foe Hayworth  

    By TAMARA AUDI and AARON ZITNER

    PHOENIX—Like many of his fellow tea party activists, Lee Earle adores former Alaska Gov. Sarah Palin. But when Ms. Palin shows up at a pair of rallies in Arizona on Friday and Saturday, he won’t be attending.

    Associated PressSarah Palin listens to daughter Piper after speaking at the Orange County GOP executive committee dinner in Orlando, Fla., this month. Ms. Palin will attend rallies for Sen. John McCain in Arizona Friday and Saturday.

    PALIN_sub

    PALIN_sub

    That’s because Ms. Palin is coming to stump for her former running mate, Sen. John McCain. Mr. Earle is backing J.D. Hayworth, Mr. McCain’s challenger in the Republican primary on Aug. 24. Mr. Hayworth, a former congressman and talk-radio host, has become a darling for some in the tea party movement.

    “Most of the tea party people I know are disappointed with her decision” to support Mr. McCain, says Mr. Earle. “But we understand she’s fulfilling an obligation to Sen. McCain for pulling her from obscurity.”

    Like many Republicans, Ms. Palin is trying to navigate a political order transformed from 2008. Mr. McCain was the Republican nominee for president in 2008, but he is now fighting off an aggressive primary challenge in a state he has represented since 1983.

    Question of the Day

    A Rasmussen Report released March 16 shows Mr. McCain ahead by seven points, with a margin of error of plus or minus four points. Earlier polling put Mr. McCain ahead by 22 points.

    Arizona’s primary race “went from very sleepy to being very captivating,” says Randy Pullen, chairman of the state’s Republican Party.

    Ms. Palin has served as a rallying force for the tea party movement. In February, a gathering billed as the first national tea party convention, which had been marked by infighting and cancellations, heard a rousing keynote address from Ms. Palin in which she took aim at President Barack Obama. On Saturday, organizers say she will attend a tea party rally in Searchlight, Nev., the hometown of Senate Democratic leader Harry Reid, after campaigning that day for Mr. McCain.

    Yet not all of Ms. Palin’s policy stances are in synch with the bulk of thinking in the disparate tea party groups.

    Like many conservative activists, she criticizes the government’s rescue of the financial system and Mr. Obama’s stimulus package. This week, she began soliciting donations to campaign against Democrats who represent Republican-leaning districts but who voted for Mr. Obama’s health care legislation.

    On immigration, however, Ms. Palin parts with the hard line of some tea party activists. As a candidate for vice president, Ms. Palin told Univision, the Spanish-language TV network, that she supported a pathway to citizenship for undocumented workers.

    “I do, because I understand why people would want to be in America—to seek the safety and prosperity, the opportunities, the health that is here,” she told the network. At the same time, she said she opposed “total amnesty.”

    That puts Ms. Palin closer to the position of Mr. McCain on an issue that will loom large in the Arizona primary. It also places her at odds with Mr. Hayworth, a leading opponent of the 2007 push by Mr. McCain and other lawmakers to create a pathway to citizenship for some illegal immigrants while strengthening border security. Some tea party members and conservatives are still angry over Mr. McCain’s leadership on that effort.

    Ms. Palin’s stance on free trade also appears different from that of some tea party members. Some activists say on blogs and websites that their goals include repealing the North American Free Trade Agreement and other free trade agreements—though the point is not a major focus of the groups, and it is unclear that there is broad agreement on the issue. Ms. Palin, by contrast, has defended free trade, arguing in her book, “Going Rogue: An American Life,” that protectionism helped cause the Great Depression.

    In a September speech to an investor conference in Hong Kong, Ms. Palin also said she foresaw “a future of more trade with China,” as long as China strengthened intellectual property enforcement and other legal protections. “We need to avoid protectionism and China’s flirtation with state assisted national champions,” she said. “On our part, we should be more open to Chinese investment where our national security interests are not threatened.”

    Bringing in Ms. Palin is a slightly awkward move by the McCain camp. Since the presidential campaign ended, McCain aides have aired a lot of criticisms of the former running mate, and in “Going Rogue,” Ms. Palin called the McCain campaign disorganized and slow to focus on the economy.

    ReutersA supporter attends former GOP Rep. J.D. Hayworth’s announcement of his Senate bid in Phoenix last month.

    PALIN

    PALIN

    However, neither Ms. Palin nor Mr. McCain have criticized each other directly. Mr. Rogers says the relationship between the two “is strong. …She’s coming to Arizona because she knows Sen. McCain is the right kind of leader for Arizona.”

    Several tea party organizers interviewed for this article said they supported Mr. Hayworth or Jim Deakin, another GOP challenger. But earlier this month, four tea party groups here said they would not endorse any candidate in the primary.

    “J.D. [Hayworth] likes to say he is the tea party candidate, but the tea party is not a monolith,” says Mr. Rogers. “Mr. McCain has plenty of support among those groups.”

    Trent Humphries, co-organizer of the Tucson Tea Party, says his group includes supporters of Sen. McCain and Mr. Hayworth. Mr. Humphries is undecided, but plans to attend Mr. McCain’s Tucson rally.

    In an interview Wednesday, Mr. Hayworth said it was support from Tea Party activists that prompted him to run against Mr. McCain. He said the effect of Ms. Palin’s presence on the campaign “has been one of the most-asked questions since the campaign began. I guess we’ll see.”

    Mr. Hayworth said he has never met Ms. Palin, “but we have a lot in common. …I welcome her support following the primary.”

    While Ms. Palin is in Tucson on Friday, Mr. Earle, the tea party activist, will be at a rally in Phoenix with antitax protester Samuel Joseph Wurzelbacher, “Joe the Plumber,” who gained fame during the 2008 election. “But I still love Sarah,” he says.

    —Laura Meckler contributed to this article. Write to Tamara Audi at tammy.audi@wsj.com

     

     

     

    Resistance Is Not Futile

    Resistance Is Not Futile

    Republicans must make it clear to the American people that this is only the beginning of the debate.

    By PHIL GRAMM

    For every dollar’s worth of health care that Americans received last year, they paid a dime and somebody else paid 90 cents. If you bought food the way you buy health care—where 90% of everything you put in your basket was paid for by your grocery insurance policy—you would eat differently and so would your dog. We have the best health-care system in the world, but as rich as America is we can’t afford it.

    Any real debate about health-care reform has to be centered on solving the problem of cost. Ultimately, there are only two ways of doing it. The first approach is to have government control costs through some form of rationing. The alternative is to empower families to make their own health-care decisions in a system where costs matter. The fundamental question is about who is going to do the controlling: the family or the government.

    President Obama and his congressional allies systematically excluded every major proposal to empower consumers to control costs. From beginning to end, they insisted on a government-run system. That’s why compromise was never possible.

    The plan signed into law by the president on Tuesday is simply a hodgepodge of schemes to expand insurance coverage and government power with no coherent program to control cost. By contrast, the old Clinton health-care bill was a plan to control costs through health-care purchasing cooperatives, standards of medical practice, and penalties for providers who violated those standards. When Americans came to understand the loss of freedom resulting from the Clinton plan, they rejected it. The Democrats learned from that experience. This time around they simply left their cost control component to be added later.

    Even though the Obama bill became far more unpopular than the Clinton bill ever was, the daunting size and rigid commitment of the Democratic majority to a government-run system was such that they could override public opinion. Now the Democrats are out to make Americans like their plan—or at least get them to acquiesce to it. But as Gandhi once explained, 40,000 British troops cannot force 300 million Indians to do what they will not do.

    Republicans have a job to do. They must make it clear to the American people that this is only the beginning of the debate. There will be two congressional elections and a presidential election before the government takeover is implemented in 2014.

    I believe that Republicans should take the unequivocal position that if they are given a majority in Congress in November, they will stop the implementation of the government takeover. And if a Republican is elected president in 2012, they will do with Mr. Obama’s health-care bill what the American voters will have done to the Democrats: throw it out. If the voters demand change in November, even the Democrats who remain in Congress will help give it to them.

    If Republicans don’t want America to follow Britain and Canada down the road to socialized medicine, they must change the system so that families have more power to control their own health-care costs. This will entail real changes like tax deductions for health insurance, not for prepaid medicine; refundable tax credits for families to buy their own insurance; freedom to negotiate with insurance companies; rewarding healthy lifestyles; tort reform; and reforming Medicare and Medicaid so every consumer has deductibles and copayments based on their income. This system will require Americans to make choices in health care—just as they do in every other area of their lives.

    There is one more overwhelming reason freedom is so critical in health care. In the end, even the greatest health-care system in the world fails. At 92, my mother decided to stop going to the hospital, stop going to the doctor, stop taking her medicine, and to die in her own bed. It was a free choice, and she made it. For her family, it was a painful choice, but she died as she lived—proud and free. Government bureaucrats did not make that decision; she did. And that made all the difference.

    Mr. Gramm, a Republican, was a senator from Texas from 1985 to 2002 and served as chairman of the Health subcommittee of the Senate Committee on Finance.

     

    Personal Income Drops Across the Country

    Personal Income Drops Across the Country

    By SARA MURRAY

    Personal income in 42 states fell in 2009, the Commerce Department said Thursday.

    Real Time Economics

    Declining Incomes

    How state personal income changed in 2009 from 2008.

    Nevada’s 4.8% plunge was the steepest, as construction and tourism industries took a beating. Also hit hard: Wyoming, where incomes fell 3.9%.

    Incomes stayed flat in two states and rose in six and the District of Columbia. West Virginia had the best showing with a 2.1% increase. In Maine, Kentucky and Hawaii, increased government benefits, such as unemployment insurance and Social Security, offset drops in earnings and property values.

    Nationally, personal income from wages, dividends, rent, retirement plans and government benefits declined 1.7% last year, unadjusted for inflation. One bright spot: As the economy recovered, personal income was up in all 50 states in the fourth quarter compared with the third. Connecticut, again, had the highest per capita income of the 50 states at $54,397 in 2009. Mississippi ranked lowest at $30,103.

    Write to Sara Murray at sara.murray@wsj.com

     

     

    Inside the Pelosi Sausage Factory Michigan Rep. Bart Stupak sold his anti-abortion soul for a toothless executive order.

    Inside the Pelosi Sausage Factory

    Michigan Rep. Bart Stupak sold his anti-abortion soul for a toothless executive order.

     

    By KIMBERLEY A. STRASSEL

    Last week Republican Rep. Mike Pence posted on his Facebook site that famous Schoolhouse Rock video titled “How a Bill Becomes a Law.” It’s clearly time for a remake.

    Never before has the average American been treated to such a live-action view of the sordid politics necessary to push a deeply flawed bill to completion. It was dirty deals, open threats, broken promises and disregard for democracy that pulled ObamaCare to this point, and yesterday the same machinations pushed it across the finish line.

    You could see it all coming a week ago, when New York Rep. Louise Slaughter let leak a breathtaking strategy whereby the House would not actually vote on the unpopular Senate bill. The House would instead vote on a “reconciliation” fix to that bill, and in the process “deem” the underlying legislation—with its Cornhusker kickbacks and Louisiana purchases—passed.

    Associated PressHouse Democratic leaders on Capitol Hill yesterday.

    strassel

    strassel

    The Slaughter Solution was both blunt admission and warning. House Speaker Nancy Pelosi did not have 216 votes to pass the Senate bill, there never was going to be majority “support” for it, but they’d pass it anyway. The final days were a simple death watch, to see how the votes would be bought, bribed or bullied, and how many congressional rules gamed, to get the win.

    President Obama flew to Pennsylvania (home to five wavering House Democrats), Missouri (three wavering), Ohio (eight), and Virginia (four) to hold rallies with small, supportive crowds. In four days, Mr. Obama held 64 meetings or calls with congressmen. The goal was to let undecideds know that the president had them in his crosshairs, that he still had pull with the base, and he’d use it against them. By Saturday the tactic had yielded yes votes from at least half the previously undecided members of those states.

    As for those who needed more persuasion: California Rep. Jim Costa bragged publicly that during his meeting in the Oval Office, he’d demanded the administration increase water to his Central Valley district. On Tuesday, Interior pushed up its announcement, giving the Central Valley farmers 25% of water supplies, rather than the expected 5% allocation. Mr. Costa, who denies there was a quid pro quo, on Saturday said he’d flip to a yes.

    Florida Rep. Suzanne Kosmas (whose district is home to the Kennedy Space Center) admitted that in her own Thursday meeting with the president, she’d brought up the need for more NASA funding. On Friday she flipped to a yes. So watch the NASA budget.

    Democrats inserted a new provision providing $100 million in extra Medicaid money for Tennessee. Retiring Tennessee Rep. Bart Gordon flipped to a yes vote on Thursday.

    Outside heavies were enlisted to warn potential no votes that unions and other Democrats would run them out of Congress. Al Lawson, a Tallahassee liberal challenging Blue Dog Florida Rep. Allen Boyd in a primary, made Mr. Boyd’s previous no vote the centerpiece of his criticism. The SEIU threatened to yank financial support for New York’s Michael McMahon. The liberal Working Families Party said it would deny him a ballot line. Obama deputy campaign manager Steve Hildebrand vowed to challenge South Dakota Rep. Stephanie Herseth Sandlin if she voted no. New York’s Scott Murphy was targeted as a part of a $1.3 million union-financed ad campaign to pressure him to flip. Moveon.Org spent another $36,000 on ads in his district and promised a primary. Messrs. Boyd and Murphy caved on Friday.

    All the while Mrs. Pelosi was desperately working to provide cover with a Congressional Budget Office score that would claim the bill “saved” money. To do it, Democrats threw in a further $66 billion in Medicare cuts and another $50 billion in taxes. Huzzah! In the day following the CBO score, about a half-dozen Democrats who had spent the past months complaining the bill already had too many taxes and Medicare cuts now said they were voting to reduce the deficit.

    Even with all this, by Friday Mrs. Pelosi was dealing with a new problem: The rule changes and deals winning her votes were losing her votes, too. The public backlash against “deem and pass” gave several wary Democrats—such as Massachusetts’s Stephen Lynch and California’s Dennis Cardoza—a new excuse to vote no.

    Mrs. Pelosi jettisoned deem and pass. Once-solid Democrat yes votes wanted their own concessions. Oregon’s Pete DeFazio threatened to lead a revolt unless changes were made to Medicare payments to benefit his state. On Saturday Mrs. Pelosi cut a deal to give 17 states additional Medicare money.

    By the weekend, all the pressure and threats and bribes had left the speaker three to five votes short. Her remaining roadblock was those pro-life members who’d boxed themselves in on abortion, saying they would vote against the Senate bill unless it barred public funding of abortion. Mrs. Pelosi’s first instinct was to go around this bloc, getting the votes elsewhere. She couldn’t.

    Into Saturday night, Michigan’s Bart Stupak and Mrs. Pelosi wrangled over options. The stalemate? Any change that gave Mr. Stupak what he wanted in law would lose votes from pro-choice members. The solution? Remove it from Congress altogether, having the president instead sign a meaningless executive order affirming that no public money should go to pay for abortions.

    The order won’t change the Senate legal language—as pro-choice Democrats publicly crowed within minutes of the Stupak deal. Executive orders can be changed or eliminated on a whim. Pro-life groups condemned the order as the vote-getting ruse it was. Nevertheless, Mr. Stupak and several of his colleagues voted yes, paving the way to Mrs. Pelosi’s final vote tally of 219.

    Even in these waning minutes, Senate Democrats were playing their own games. Republicans announced they had found language in the House reconciliation bill that could doom this entire “fix” in the Senate. Since many House Democrats only agreed to vote for the Senate bill on promises that the sidecar reconciliation would pass, this was potentially a last-minute killer.

    Senate Democrats handled it by deliberately refusing to meet with Republicans and the Senate parliamentarian to get a ruling, lest it be unfavorable and lose House votes. The dodge was a clear dereliction of duty, but Democrats figure the Senate parliamentarian won’t dare derail this process after ObamaCare passes. They are probably right.

    So there you have it, folks: “How a Bill Becomes a Law,” at least in Obama-Pelosi land. Perhaps the most remarkable Democratic accomplishment this week was to make the process of passing ObamaCare as politically toxic as the bill itself.

    President Obama was elected by millions of Americans attracted to his promise to change Washington politics. These were voters furious with earmarks, insider deals and a lack of transparency. They were the many Americans who, even before this week, held Congress in historic low esteem. They’ll remember this spectacle come November.

    Ms. Strassel writes the Journal’s weekly Potomac Watch column from Washington.