Thursday, January 31, 2013

Hackers in China Attacked The Times for Last 4 Months

SAN FRANCISCO — For the last four months, Chinese hackers have persistently attacked The New York Times, infiltrating its computer systems and getting passwords for its reporters and other employees.

After surreptitiously tracking the intruders to study their movements and help erect better defenses to block them, The Times and computer security experts have expelled the attackers and kept them from breaking back in.

The timing of the attacks coincided with the reporting for a Times investigation, published online on Oct. 25, that found that the relatives of Wen Jiabao, China’s prime minister, had accumulated a fortune worth several billion dollars through business dealings.

Security experts hired by The Times to detect and block the computer attacks gathered digital evidence that Chinese hackers, using methods that some consultants have associated with the Chinese military in the past, breached The Times’s network. They broke into the e-mail accounts of its Shanghai bureau chief, David Barboza, who wrote the reports on Mr. Wen’s relatives, and Jim Yardley, The Times’s South Asia bureau chief in India, who previously worked as bureau chief in Beijing.

“Computer security experts found no evidence that sensitive e-mails or files from the reporting of our articles about the Wen family were accessed, downloaded or copied,” said Jill Abramson, executive editor of The Times.

The hackers tried to cloak the source of the attacks on The Times by first penetrating computers at United States universities and routing the attacks through them, said computer security experts at Mandiant, the company hired by The Times. This matches the subterfuge used in many other attacks that Mandiant has tracked to China.

The attackers first installed malware — malicious software — that enabled them to gain entry to any computer on The Times’s network. The malware was identified by computer security experts as a specific strain associated with computer attacks originating in China. More evidence of the source, experts said, is that the attacks started from the same university computers used by the Chinese military to attack United States military contractors in the past.

Security experts found evidence that the hackers stole the corporate passwords for every Times employee and used those to gain access to the personal computers of 53 employees, most of them outside The Times’s newsroom. Experts found no evidence that the intruders used the passwords to seek information that was not related to the reporting on the Wen family.

No customer data was stolen from The Times, security experts said.

Asked about evidence that indicated the hacking originated in China, and possibly with the military, China’s Ministry of National Defense said, “Chinese laws prohibit any action including hacking that damages Internet security.” It added that “to accuse the Chinese military of launching cyberattacks without solid proof is unprofessional and baseless.”

The attacks appear to be part of a broader computer espionage campaign against American news media companies that have reported on Chinese leaders and corporations.

Last year, Bloomberg News was targeted by Chinese hackers, and some employees’ computers were infected, according to a person with knowledge of the company’s internal investigation, after Bloomberg published an article on June 29 about the wealth accumulated by relatives of Xi Jinping, China’s vice president at the time. Mr. Xi became general secretary of the Communist Party in November and is expected to become president in March. Ty Trippet, a spokesman for Bloomberg, confirmed that hackers had made attempts but said that “no computer systems or computers were compromised.”

Signs of a Campaign

The mounting number of attacks that have been traced back to China suggest that hackers there are behind a far-reaching spying campaign aimed at an expanding set of targets including corporations, government agencies, activist groups and media organizations inside the United States. The intelligence-gathering campaign, foreign policy experts and computer security researchers say, is as much about trying to control China’s public image, domestically and abroad, as it is about stealing trade secrets.

Security experts said that beginning in 2008, Chinese hackers began targeting Western journalists as part of an effort to identify and intimidate their sources and contacts, and to anticipate stories that might damage the reputations of Chinese leaders.

In a December intelligence report for clients, Mandiant said that over the course of several investigations it found evidence that Chinese hackers had stolen e-mails, contacts and files from more than 30 journalists and executives at Western news organizations, and had maintained a “short list” of journalists whose accounts they repeatedly attack.

While computer security experts say China is most active and persistent, it is not alone in using computer attacks for a variety of national purposes, including corporate espionage. The United States, Israel, Russia and Iran, among others, are suspected of developing and deploying cyberweapons.

The United States and Israel have never publicly acknowledged it, but evidence indicates they released a sophisticated computer worm starting around 2008 that attacked and later caused damage at Iran’s main nuclear enrichment plant. Iran is believed to have responded with computer attacks on targets in the United States, including American banks and foreign oil companies.

Russia is suspected of having used computer attacks during its war with Georgia in 2008.

The following account of the attack on The Times — which is based on interviews with Times executives, reporters and security experts — provides a glimpse into one such spy campaign.

After The Times learned of warnings from Chinese government officials that its investigation of the wealth of Mr. Wen’s relatives would “have consequences,” executives on Oct. 24 asked AT&T, which monitors The Times’s computer network, to watch for unusual activity.

On Oct. 25, the day the article was published online, AT&T informed The Times that it had noticed behavior that was consistent with other attacks believed to have been perpetrated by the Chinese military.

The Times notified and voluntarily briefed the Federal Bureau of Investigation on the attacks and then — not initially recognizing the extent of the infiltration of its computers — worked with AT&T to track the attackers even as it tried to eliminate them from its systems.

But on Nov. 7, when it became clear that attackers were still inside its systems despite efforts to expel them, The Times hired Mandiant, which specializes in responding to security breaches. Since learning of the attacks, The Times — first with AT&T and then with Mandiant — has monitored attackers as they have moved around its systems.

Hacker teams regularly began work, for the most part, at 8 a.m. Beijing time. Usually they continued for a standard work day, but sometimes the hacking persisted until midnight. Occasionally, the attacks stopped for two-week periods, Mandiant said, though the reason was not clear.

Investigators still do not know how hackers initially broke into The Times’s systems. They suspect the hackers used a so-called spear-phishing attack, in which they send e-mails to employees that contain malicious links or attachments. All it takes is one click on the e-mail by an employee for hackers to install “remote access tools” — or RATs. Those tools can siphon off oceans of data — passwords, keystrokes, screen images, documents and, in some cases, recordings from computers’ microphones and Web cameras — and send the information back to the attackers’ Web servers.

Michael Higgins, chief security officer at The Times, said: “Attackers no longer go after our firewall. They go after individuals. They send a malicious piece of code to your e-mail account and you’re opening it and letting them in.”

Lying in Wait

Once hackers get in, it can be hard to get them out. In the case of a 2011 breach at the United States Chamber of Commerce, for instance, the trade group worked closely with the F.B.I. to seal its systems, according to chamber employees. But months later, the chamber discovered that Internet-connected devices — a thermostat in one of its corporate apartments and a printer in its offices — were still communicating with computers in China.

In part to prevent that from happening, The Times allowed hackers to spin a digital web for four months to identify every digital back door the hackers used. It then replaced every compromised computer and set up new defenses in hopes of keeping hackers out.

“Attackers target companies for a reason — even if you kick them out, they will try to get back in,” said Nick Bennett, the security consultant who has managed Mandiant’s investigation. “We wanted to make sure we had full grasp of the extent of their access so that the next time they try to come in, we can respond quickly.”

Based on a forensic analysis going back months, it appears the hackers broke into The Times computers on Sept. 13, when the reporting for the Wen articles was nearing completion. They set up at least three back doors into users’ machines that they used as a digital base camp. From there they snooped around The Times’s systems for at least two weeks before they identified the domain controller that contains user names and hashed, or scrambled, passwords for every Times employee.

While hashes make hackers’ break-ins more difficult, hashed passwords can easily be cracked using so-called rainbow tables — readily available databases of hash values for nearly every alphanumeric character combination, up to a certain length. Some hacker Web sites publish as many as 50 billion hash values.

Investigators found evidence that the attackers cracked the passwords and used them to gain access to a number of computers. They created custom software that allowed them to search for and grab Mr. Barboza’s and Mr. Yardley’s e-mails and documents from a Times e-mail server.

Over the course of three months, attackers installed 45 pieces of custom malware. The Times — which uses antivirus products made by Symantec — found only one instance in which Symantec identified an attacker’s software as malicious and quarantined it, according to Mandiant.

A Symantec spokesman said that, as a matter of policy, the company does not comment on its customers.

The attackers were particularly active in the period after the Oct. 25 publication of The Times article about Mr. Wen’s relatives, especially on the evening of the Nov. 6 presidential election. That raised concerns among Times senior editors who had been informed of the attacks that the hackers might try to shut down the newspaper’s electronic or print publishing system. But the attackers’ movements suggested that the primary target remained Mr. Barboza’s e-mail correspondence.

“They could have wreaked havoc on our systems,” said Marc Frons, the Times’s chief information officer. “But that was not what they were after.”

What they appeared to be looking for were the names of people who might have provided information to Mr. Barboza.

Mr. Barboza’s research on the stories, as reported previously in The Times, was based on public records, including thousands of corporate documents through China’s State Administration for Industry and Commerce. Those documents — which are available to lawyers and consulting firms for a nominal fee — were used to trace the business interests of relatives of Mr. Wen.

A Tricky Search

Tracking the source of an attack to one group or country can be difficult because hackers usually try to cloak their identities and whereabouts.

To run their Times spying campaign, the attackers used a number of compromised computer systems registered to universities in North Carolina, Arizona, Wisconsin and New Mexico, as well as smaller companies and Internet service providers across the United States, according to Mandiant’s investigators.

The hackers also continually switched from one I.P. address to another; an I.P. address, for Internet protocol, is a unique number identifying each Internet-connected device from the billions around the globe, so that messages and other information sent by one device are correctly routed to the ones meant to get them.

Using university computers as proxies and switching I.P. addresses were simply efforts to hide the source of the attacks, which investigators say is China. The pattern that Mandiant’s experts detected closely matched the pattern of earlier attacks traced to China. After Google was attacked in 2010 and the Gmail accounts of Chinese human rights activists were opened, for example, investigators were able to trace the source to two educational institutions in China, including one with ties to the Chinese military.

Security experts say that by routing attacks through servers in other countries and outsourcing attacks to skilled hackers, the Chinese military maintains plausible deniability.

“If you look at each attack in isolation, you can’t say, ‘This is the Chinese military,’ ” said Richard Bejtlich, Mandiant’s chief security officer.

But when the techniques and patterns of the hackers are similar, it is a sign that the hackers are the same or affiliated.

“When you see the same group steal data on Chinese dissidents and Tibetan activists, then attack an aerospace company, it starts to push you in the right direction,” he said.

Mandiant has been tracking about 20 groups that are spying on organizations inside the United States and around the globe. Its investigators said that based on the evidence — the malware used, the command and control centers compromised and the hackers’ techniques — The Times was attacked by a group of Chinese hackers that Mandiant refers to internally as “A.P.T. Number 12.”

A.P.T. stands for Advanced Persistent Threat, a term that computer security experts and government officials use to describe a targeted attack and that many say has become synonymous with attacks done by China. AT&T and the F.B.I. have been tracking the same group, which they have also traced to China, but they use their own internal designations.

Mandiant said the group had been “very active” and had broken into hundreds of other Western organizations, including several American military contractors.

To get rid of the hackers, The Times blocked the compromised outside computers, removed every back door into its network, changed every employee password and wrapped additional security around its systems.

For now, that appears to have worked, but investigators and Times executives say they anticipate more efforts by hackers.

“This is not the end of the story,” said Mr. Bejtlich of Mandiant. “Once they take a liking to a victim, they tend to come back. It’s not like a digital crime case where the intruders steal stuff and then they’re gone. This requires an internal vigilance model.”

Wednesday, January 30, 2013

Israeli strike indicates Syria, Hezbollah may have crossed its 'red line'

Israeli jets reportedly carried out an unprecedented airstrike along the Lebanon-Syria border today against an arms convoy carrying advanced anti-aircraft missiles to the Lebanese Shiite militant group Hezbollah.

If the alleged arms shipment is confirmed, it would be a significant development that crosses Israel's repeated "red line" regarding the transfer of advanced air defense systems to Hezbollah.

The convoy was carrying SA-17 "Grizzly" mobile medium-range anti-aircraft missiles, according to the Associated Press, which quoted Israeli and US officials. The location of the attack remained unclear, although reports said it occurred on Syrian territory close to the border with Lebanon.

Since 2006, when Hezbollah and Israel fought a month-long war, the Lebanese group has steadily expanded its arsenal, both in size and capabilities, in preparation for a possible conflict with the Jewish state.

The Lebanese Army acknowledged in a statement that three waves of Israeli aircraft violated Lebanese airspace between 4:30 p.m. yesterday and 7:55 a.m. today. Israeli jets and reconnaissance drones stage flyovers above Lebanon on a near daily basis – the white contrails made by the passing aircraft are a common sight on clear days – but a Western diplomat said that there had been a “substantially unusual and very high level of air activity in the past two days."

Lebanese security sources denied all knowledge of an airstrike along the border and there were no reports in Lebanese media this morning of any such incident.

Israeli Prime Minister Benjamin Netanyahu last week gathered Israel's top security chiefs to discuss the threat posed by the war in Syria, in particular the possibility of Syria’s chemical weapons arsenal falling into the hands of radical groups.

Syria is believed to have one of the largest chemical weapons stockpiles in the world, including VX and Sarin nerve gas and blister agents which can be loaded into rocket warheads.

“We have been monitoring for a long time the possibility that chemical weapons will fall into the hands of extremist rebels, or worse, into the hands of Hezbollah,” Silvan Shalom, Israel’s deputy premier said on Jan. 27. Shalom added that if Hezbollah was to acquire chemical weapons, it would be “a crossing of all red lines that would require a different approach, including even preventative operations… The concept, in principle, is that this [transfer] must not happen.”

Over the weekend, Israel deployed two batteries of the Iron Dome anti-missile system near Haifa, close to the border with Lebanon, another indication of Israeli concern at the possibility of Hezbollah acquiring advanced missiles.

If Israeli aircraft did intercept a Hezbollah arms convoy last night, there are a limited number of places along the border where the attack could have occurred. Hezbollah controls a lengthy stretch of the rugged barren mountains that mark the eastern border and a small length of the northern border, both of which are believed to have been used in the past to bring in weapons. Hezbollah traditionally remains tight-lipped on how weapons transfers are made, although it does not deny possessing a formidable arsenal.

“We do not fight our enemies with swords made of wood,” quipped Hezbollah chief Sheikh Hassan Nasrallah in 2007 when admitting in a speech that “all kinds and quantities” of weapons were being acquired by his party.

The Israeli government considers Hezbollah’s acquisition of chemical weapons and advanced anti-aircraft missiles a “red line” that would justify an airstrike. But targeting a Hezbollah arms convoy would be an unprecedented act by Israel and would risk raising tensions along the Lebanon-Israel border, which has remained calm since the month-long war between the two foes in 2006.

Last year, Syria confirmed that it had received a number of SA-17 batteries from Russia as part of a deal signed several years ago. Two batteries were reportedly operational last April along the Lebanon-Syria border. The SA-17 has a range of 30 miles and can hit multiple targets at 40,000 feet, putting all manner of Israeli aircraft, from reconnaissance drones to jets, at risk in Lebanese or adjacent airspace.

Little is known of Hezbollah's anti-aircraft capabilities. The only air defense missiles employed by the group in the past were relatively antiquated SA-7 shoulder-fired systems, which pose little threat to Israeli military aircraft. It is believed that Hezbollah possesses the SA-18 grouse, a more advanced version of the SA-7. In 2010, it was reported that Hezbollah militants were being trained in Syria on the SA-8 Gecko mobile short-range system, although none at the time were thought to have been transferred to Lebanon.

Fed keeps stimulus in place as U.S. economy "paused"

(Reuters) - The Federal Reserve on Wednesday left in place its monthly $85 billion bond-buying stimulus plan, arguing the support was needed to lower unemployment even as it indicated a recent stall in U.S. economic growth was likely temporary.

The U.S. central bank predicted that the nation's job market would continue to improve at a modest pace, and repeated a pledge to keep purchasing securities until the outlook for employment "improves substantially."

"Growth in economic activity paused in recent months, in large part because of weather-related disruptions and other transitory factors," the Fed said after a two-day meeting.

A report on Wednesday showed the U.S. economy unexpectedly contracted in the fourth quarter as inventory investment slowed and government spending plunged. Analysts said superstorm Sandy, which slammed into a large swath of the U.S. East Coast in late October, also disrupted the recovery.

The Fed has kept overnight interest rates near zero since late 2008 and tripled its balance sheet to about $3 trillion through purchases of securities, which are aimed at pushing longer-term borrowing costs lower.

While the recovery from the 2007-2009 recession has been stubbornly tepid, the Fed's policy panel voiced confidence it would remain on track with continued help from monetary policy.

"The committee expects that, with appropriate policy accommodation, economic growth will proceed at a moderate pace and the unemployment rate will gradually decline toward levels the committee judges consistent with its dual mandate," it said.

That was cautiously more optimistic than the Fed had sounded in December, when it emphasized it was "concerned" the economy would not deliver stronger hiring without policy support.

"The changes to the policy rationale were tilted to sound more affirmative in nature," JPMorgan economist Michael Feroli wrote in a note to clients.

A report on Friday is expected to show the U.S. jobless rate remained stuck at 7.8 percent for a third straight month in January. The Fed repeated that it would keep overnight rates near zero until the unemployment rate hits 6.5 percent, as long as inflation does not threaten to exceed 2.5 percent.

"It's a message that policy is steady as she goes," said Julia Coronado, an economist at BNP Paribas in New York.

By and large, the statement was widely as anticipated, and U.S. stocks, government bonds and the dollar were little changed after the news.


The Fed noted that consumer spending and business investment had picked up and the housing sector had shown further improvement. It also acknowledged calmer financial conditions in Europe, omitting a December warning that these posed a significant threat, although it said downside risks remained.

Kansas City Federal Reserve Bank President Esther George, in her first policy vote, dissented against continued Fed stimulus, picking up the mantle left behind by Richmond Fed chief Jeffrey Lacker, who dissented at every policy meeting last year.

The Fed's bond-buying program, under which it currently purchases $40 billion of mortgage-backed bonds and $45 billion of longer-dated Treasuries a month, is part of the central bank's unprecedented effort to spark a stronger recovery and drive down unemployment.

Most analysts do not expect the outlook for the labor market to show the substantial improvement the Fed wants to see this year, keeping it on track for further bond buying.

Even so, minutes of the Fed's last meeting in December, released early this month, showed that a few policymakers thought the program should be halted by the middle of 2013.

Some Fed officials have voiced concern that any benefit from the bond purchases could be offset by mounting costs.

Two potential threats policymakers see are the risk of fueling an asset price bubble and the possibility of harming the functioning of Treasury and mortgage-backed bond markets. Some also worry that the Fed could suffer a loss when it eventually sells bonds to shrink its balance sheet, which might have serious political consequences for its independence.

Republicans have been persistently critical of the Fed and Congressman Jeb Hensarling, chairman of the powerful House Financial Services Committee, went to the trouble of issuing a statement to take issue with its decision on Wednesday.

"There is little which monetary policy can achieve to promote economic growth and much the Fed risks by its continued commitment to an overly accommodative monetary policy stance," he said.

I can still remember a time when they used to blame the weather for higher sales and double digit growth..That's how old I am

Inside the Ring: New al Qaeda threat

A jihadist website posted a new threat by al Qaeda this week that promises to conduct “shocking” attacks on the United States and the West.

The posting appeared on the Ansar al Mujahidin network Sunday and carried the headline, “Map of al Qaeda and its future strikes.”

The message, in Arabic, asks: “Where will the next strike by al Qaeda be?” A translation was obtained by Inside the Ring.

“The answer for it, in short: The coming strikes by al Qaeda, with God’s Might, will be in the heart of the land of nonbelief, America, and in France, Denmark, other countries in Europe, in the countries that helped and are helping France, and in other places that shall be named by al Qaeda at other times,” the threat states.

The attacks will be “strong, serious, alarming, earth-shattering, shocking and terrifying.”

Under a section of the post on the method of the attacks, the unidentified writer said the strikes would be “group and lone-wolf operations, in addition to the use of booby-trapped vehicles.”

“All operations will be recorded and published in due time,” the message said. “Let France be prepared, and let the helpers of France be prepared, for it is going to be a long war of attrition.”

The reference to France appears linked to the group’s plans for retaliation against the French-led military strikes in northern Mali in operations to oust al Qaeda terrorists from the North African country.

The Ansar al-Mujahidin network is a well-known jihadist forum that in the past has published reliably accurate propaganda messages from al Qaeda and its affiliates.

U.S. counterterrorism actions over the past 10 years have prevented al Qaeda from conducting major attacks. However, U.S. officials warn that the group continues to be dangerous, despite the killing of its top leaders in drone strikes and special operations.

A U.S. official said the threat is being taken seriously by the U.S. government.

“Extremists regularly make threats online,” he told Inside the Ring. “This one is not particularly unusual, but of course should be taken seriously.”

Retired officers on Hagel

Retired senior military officers on the right and left of the political spectrum are squaring off in the confirmation fight for former Sen. Chuck Hagel, President Obama’s nominee for defense secretary who is set to appear before the Senate Armed Services Committee on Thursday.

Conservative former officers say Mr. Hagel is the wrong person to head the Pentagon because of his soft-line views on Iran, hostility toward Israel and support for cuts in U.S. military and nuclear forces.

Liberal retirees say the decorated Vietnam War veteran will be a strong leader who will support “war fighters.”

Fourteen retired flag officers wrote to the committee this week, urging the panel to reject Mr. Hagel.

The group — including retired Pacific Fleet commander Adm. James “Ace” Lyons and former Delta Force commando Army Lt. Gen. Jerry Boykin — said they oppose confirming the liberal Nebraska Republican for the Pentagon post because he would further cut U.S. military forces and also because he favors the total elimination of nuclear forces.

“Our nation faces enormous national security challenges as we enter 2013,” said the group linked to the conservative Center for Security Policy.

“Addressing those challenges will require leadership at the Pentagon that recognizes the gravity of the threats we face and understands the requirement for a formidable military capable of deterring and, if necessary, overcoming them. Sen. Hagel’s record on key issues indicates he is not such a leader.”

On the other side, a group of retired generals and admirals issued a statement in December supporting Mr. Hagel. They include retired Air Force Lt. Gen. Brent Scowcroft, a former national security adviser in the George H.W. Bush administration; retired Adm. William Fallon, a former Pacific command leader; and retired Marine Corps Gen. Anthony Zinni, former head of Central Command.

These 11 generals and admirals said in their statement that they support Mr. Hagel for Pentagon chief because “he has stood up for what he believes are the best interests of the United States.”

Sen. Hagel has been a voice of moderation and balance in an unbalanced time, and we can think of few people better qualified to lead the Department of Defense,” these retired officers stated.

Senate end-run suggested

Newly confirmed Secretary of State-designate John F. Kerry signaled last week that the Obama administration is planning to seek more executive agreements for future arms-control deals.

The use of such agreements would avoid contentious political battles in the Senate but is raising concerns that such accords would circumvent the Senate’s constitutional duty to provided advice and consent for international treaties.

Sen. James E. Risch, Idaho Republican, told Mr. Kerry during a Jan. 24 Senate Foreign Relations Committee hearing on the nomination:

“There are a lot of us that are becoming increasingly concerned about all this talk regarding executive agreements, as opposed to treaties that are negotiated by the executive branch, as contemplated by the Founding Fathers and ratified, if appropriate, by this committee and eventually by the full Senate.”

Mr. Kerry was asked about “bypassing” the committee. He replied with a carefully worded answer that did not rule out the use of non-ratified agreements.

“Well, every administration in its history — Republican and Democrat alike — has entered into executive agreements,” Mr. Kerry said.

“I don’t want to be commenting in some prophylactic way one side or the other without the specific situation in front of me,” he said. “But I’m confident the president is committed to upholding the Constitution.”

Mr. Obama, however, already has taken steps to use administrative power as opposed to formal legislative remedies, in seeking tighter controls on guns in the aftermath of the Newtown, Conn., school shooting.

Mr. Kerry said that if Republicans and Democrats could get along better, then treaties were more likely to be submitted.

“There’s no better way to guarantee that whatever concerns you have about the president’s desire to move on an executive agreement would be greatly, you know, nullified or mollified if we could find a way to cooperate on a treaty or on the broader issues that face the nation,” Mr. Kerry said.

However, he added: “I think there’s a lot of frustration out there that some of the automatic ideological restraint here that prevents the majority from being able to express their voice has restrained people and pushed people in a way where they’ve got to consider some other ways of getting things done.”

Mr. Risch then said: “Well, and that’s exactly what concerns us, Sen. Kerry, is the fact that it’s OK to do this through the regular order if it gets done, but if it’s not going to get done, then the ends justify the means — [that] it’s OK to end-run around the Constitution.”

Mr. Risch said the nation’s founders “didn’t say do this if it’s convenient, and it’s OK to not do it if it’s not convenient. I have real difficulties with that.”

Mr. Obama last year promised unspecified “flexibility” after the election in seeking a missile defense agreement with Russia during an overheard discussion with then-Russian President Dmitri Medvedev.

The administration is also looking to conclude an additional arms-control agreement with Russia on nuclear weapons.

Hagel on Fort Hood

Sen. Chuck Hagel told Senate Armed Services Committee members this week in written responses to questions that he will review a Pentagon panel study that concluded the Defense Department could not identify key indicators of terrorist radicalization among service personnel, as part of efforts to prevent a repeat of the mass terrorist shooting at Fort Hood, Texas, more than three years ago.

However, in response to a question about Muslims in the military, Mr. Hagel said he would seek to prevent the persecution of Muslims in the aftermath of the deadly shooting.

Thirteen people were killed and 29 wounded when a gunmen identified as Maj. Hassan Nidal opened fire on fellow military personnel on Nov. 5, 2009. Reports at the time said the gunman was shouting “Allah Akbhar” — God is great. Maj. Nidal also has been linked to al Qaeda terrorists in Yemen from emails intercepted by the FBI.

After the attack, however, the Pentagon refused to identify the shooting as a terrorist attack and labeled the incident “workplace violence” in what critics said was an example of Obama administration political correctness.

Mr. Hagel said in his written responses that a Defense Science Board was asked by the Pentagon to study ways to identify “behavioral indicators of violence and self-radicalization,” but it “could not determine a specific list of behaviors that would indicate risk of violent/extremist behavior.”

“If I am confirmed, I will review the implementation of the recommendations of the Fort Hood Review,” he said.

“The attack at Fort Hood was a tragedy,” he stated. “It is essential that the circumstances surrounding the attack not compromise the military’s core values regarding the free exercise of religion and treating every service member with dignity and respect.”
Washington Times

Tuesday, January 29, 2013

US debt headed toward 200 percent of GDP even after 'fiscal cliff' deal

The nation's long-term fiscal outlook hasn't significantly improved following the recent agreement between Congress and the White House over tax and spending issues, according to a new analysis.

The "fiscal cliff" deal, combined with the debt-limit agreement of August 2011, only slightly delays the United States reaching debt-to-gross domestic product levels that would damage the economy and risk another fiscal crisis, according to a report from the Peter G. Peterson Foundation released on Tuesday.

The agreement "may have prevented the immediate threats that the fiscal cliff posed to our fragile economic recovery, but we haven’t remotely fixed the nation’s debt problem," said Michael A. Peterson, president and COO of the Peterson Foundation.

"The primary goal of any sustainable fiscal policy is to stabilize the debt as a share of the economy and put it on a downward path, and yet our nation is still heading toward debt levels of 200 percent of GDP and beyond," he said.

The report concludes that the recent round of deficit-reduction measures won't make major improvements because they fail to address most of the major contributors to the debt and deficit, including rapidly rising healthcare costs.

More from The Hill:
♦ Obama: 'Every American who travels' should thank LaHood
♦ Villaraigosa, Granholm on list of rumored LaHood successors
♦ Graham threatens to block Hagel nomination over Benghazi
♦ Sale of stimulus-backed energy firm approved over GOP concerns
♦ Disney CEO rips ‘ill-informed’ Markey over ‘MagicBands’ criticism
♦ Sequester no longer the 'bad policy' bogeyman for Congress

The analysis suggests that lawmakers take action quickly to ensure that the nation is on a sustainable fiscal path.

At a House Ways and Means Committee hearing last week, lawmakers and budget experts agreed that rising healthcare costs, such as Medicare, must be addressed this year as part of efforts to overhaul the tax code and entitlement programs.

"Until spending in those areas is reduced, tax revenues are increased, or policymakers implement a combination of both, the United States will continue to have a severe long-term debt problem," the report said.

"Reforms should be implemented gradually, and fiscal improvements must be achieved before our debt level and interest payments are so high that sudden or more draconian reforms are required to avert a fiscal crisis."

The latest deal that stopped income tax increases for those making $400,000 a year or less may have only improved the burgeoning debt situation by a year.

Scheduled spending cuts from the 2011 budget deal, combined with the fiscal cliff agreement, put the debt on track to reach 200 percent of GDP by 2040, five years later than was projected prior to the passage of the two deals.

The recent deficit-reduction measure gave the nation an additional year before hitting that 200 percent threshold, the report showed.

Sequestration does not improve the outlook much, either.

Even if the budget sequester is fully implemented, federal debt would still reach 200 percent of GDP within about 28 years.

On top of that, the debt will continue to grow between now and 2022, and will accelerate significantly after that.

Debt is now projected to grow from 72 percent of GDP in 2012 to 87 percent in 2022, down only slightly from the 90 percent that was estimated before passage of the most recent deal.

Many economists suggest keeping debt at or below 60 percent of GDP, with research showing that economic growth slows for countries that have debt levels exceeding 90 percent of economic growth.

"Americans shouldn’t be under any false impression that our debt problems are behind us," Peterson said.

"And because it takes years to implement policies fairly and gradually, we need to make decisions now, before we are forced by markets to take severe action that hurts our economy and our citizens."
The Hill

Took tem this long to figure that out!

Monday, January 28, 2013

The Most Ridiculous Law of 2013 (So Far): It Is Now a Crime to Unlock Your Smartphone

This is now the law of the land:




PENALTY: In some situations, first time offenders may be fined up to $500,000, imprisoned for five years, or both. For repeat offenders, the maximum penalty increases to a fine of $1,000,000, imprisonment for up to ten years, or both.*

That's right, starting this weekend it is illegal to unlock new phones to make them available on other carriers.

I have deep sympathy for any individual who happens to get jail time for this offense. I am sure that other offenders would not take kindly to smartphone un-lockers.

But seriously: It's embarrassing and unacceptable that we are at the mercy of prosecutorial and judicial discretion** to avoid the implementation of draconian laws that could implicate average Americans in a crime subject to up to a $500,000 fine and up to five years in prison.

If people see this and respond, well no one is really going to get those types of penalties, my response is: Why is that acceptable? While people's worst fears may be a bit unfounded, why do we accept a system where we allow such discretionary authority? If you or your child were arrested for this, would it comfort you to know that the prosecutor and judge could technically throw the book at you? Would you relax assuming that they probably wouldn't make an example out of you or your kid? When as a society did we learn to accept the federal government having such Orwellian power? And is this the same country that used jury nullification against laws that it found to be unjust as an additional check upon excessive government power? [The only silver lining is that realistically it's more likely that violators would be subject to civil liability under Section 1203 of the DMCA, instead of the fine and jail penalties, but this is still unacceptable (but anyone who accepts payments to help others unlock their phones would clearly be subject to the fine of up to $500,000 and up to five years in jail).]


When did we decide that we wanted a law that could make unlocking your smartphone a criminal offense?

The answer is that we never really decided. Instead, Congress passed the Digital Millennium Copyright Act (DMCA) in 1998 to outlaw technologies that bypass copyright protections. This sounds like a great idea, but in practice it has terrible, and widely acknowledged, negative consequences that affect consumers and new innovation. The DMCA leaves it up to the Librarian of Congress (LOC) to issue exemptions from the law, exceptions that were recognized to be necessary given the broad language of the statute that swept a number of ordinary acts and technologies as potential DMCA circumvention violations.

Every three years groups like the American Foundation for the Blind have to lobby Congress to protect an exception for the blind allowing for books to be read aloud. Can you imagine a more ridiculous regulation than one that requires a lobby group for the blind to come to Capitol Hill every three years to explain that the blind still can't read books on their own and therefore need this exception?

Until recently it was illegal to jailbreak your own iPhone, and after Saturday it will be illegal to unlock a new smartphone, thereby allowing it to switch carriers. This is a result of the exception to the DMCA lapsing. It was not a mistake, but rather an intentional choice by the Librarian of Congress, that this was no longer fair use and acceptable. The Electronic Frontier Foundation among other groups has detailed the many failings of the DMCA Triennial Rulemaking process, which in this case led to this exception lapsing.

Conservatives should be leading the discussion on fixing this problem. Conservatives are understandably skeptical of agencies and unelected bureaucrats wielding a large amount of power to regulate, and are proponents of solutions like the REINS Act (which has over 121 co-sponsors). However, if Congress truly wants to rein in the power of unelected bureaucrats, then they must first write laws in a narrow manner and avoid the need for intervention by the Librarian of Congress to avoid draconian consequences, such as making iPhone jail-breakers and smartphone un-lockers criminals, or taking away readable books for the blind.

If conservatives are concerned of unelected bureaucrats deciding upon regulations which could have financial consequences for businesses, then they should be more worried about unelected bureaucrats deciding upon what is or isn't a felony punishable by large fines and jail time for our citizens. And really, why should unelected bureaucrats decide what technological choices you can make with your smartphone? These laws serve to protect the interests of a few companies and create and maintain barriers to entry.

But there is another matter of critical importance: Laws that can place people in jail should be passed by Congress, not by the decree of the Librarian of Congress. We have no way to hold the Librarian of Congress accountable for wildly unfair laws. There are still plenty of crazy laws passed by elected officials, but at least we can then vote them out of office.

There are numerous other problems with the DMCA. As I explained in an essay for Cato Unbound:

"The DMCA bars developing, selling, providing, or even linking to technologies that play legal DVDs purchased in a different region, or to convert a DVD you own to a playable file on your computer. Because no licensed DVD playing software is currently available for the Linux operating system, if a Linux user wishes to play a DVD that they have legally bought, they cannot legally play it on their own computer.
In order to regulate this anti-circumvention market, the DCMA authorizes injunctions that seem to fly in the face of First Amendment jurisprudence on prior restraint. The DMCA also makes companies liable for copyright infringement if it doesn't remove content upon notification that someone believes the content infringes their copyright - this creates a very strong business interest in immediately taking down anything that anyone claims is infringing to not be liable. Christina Mulligan's essay for Copyright Unbalanced details how in mid-July 2012 a Mitt Romney campaign ad hosted on Youtube was forcibly removed from the site, and in 2008 Youtube blocked several John McCain ads for more than 10 days. As Mulligan details, the ads were legitimate under "fair use." Allowing individual people to veto political speech that they do not like stifles free expression and political dialogue and even if a rare occurrence under the DMCA should not be taken likely. There are also other examples of abuse, Mulligan details that one group had all Justin Bieber songs removed from Youtube as a prank."

And if you thought this was bad, provisions of the DMCA relating to anti-circumvention are part of the Trans-Pacific Partnership (TPP) Treaty -- and the United States is the party asking for it as part of the negotiations. Placing it in the treaty will enact our dysfunctional system on an international level in countries that don't want it, and it will "re-codify" the DMCA in an international treaty making it significantly more difficult to revise as necessary. Copyright laws are domestic laws and they need to be flexible enough to adjust accordingly to not inhibit new innovation.

I for one am pro-choice with regard to my smartphone. Our representatives ought to be, as well.


* Specifically this refers to Section 1204 of Public Law 105-304, which provides that "any person who violates section 1201 or 1201 willfully and for purposes of commercial advantage or private financial gain. . .[shall be subject to the listed penalties]." However, given copyright laws broad interpretation by the courts, it could be argued that merely unlocking your own smartphone takes a device of one value and converts it into a device of double that value (the resale market for unlocked phones is significantly higher) and therefore unlocking is inherently providing a commercial advantage or a private financial gain - even if the gain hasn't been realized. In other words, unlocking doubles or triples the resale value of your own device and replaces the need to procure the unlocked device from the carrier at steep costs, which may be by definition a private financial gain. Alternatively, one can argue that a customer buying a cheaper version of a product, the locked version vs. the unlocked version, and then unlocking it themselves in violation of the DMCA, is denying the provider of revenue which also qualifies. There are several cases that have established similar precedents where stealing coaxial cable for personal use has been held to be for "purposes of commercial advantage or private financial gain." (See Cablevision Sys. New York City Corp. v. Lokshin, 980 F. Supp. 107, 109 (E.D.N.Y. 1997)); (Cablevision Sys. Dev. Co. v. Cherrywood Pizza, 133 Misc. 2d 879, 881, 508 N.Y.S.2d 382, 383 (Sup. Ct. 1986)).

** The Ninth Circuit recently explained in United States v. Nosal, 676 F.3d 854 (9th Cir. 2012) that under a "broad interpretation of the [Computer Fraud and Abuse Act (CFAA) you could be prosecuted for personal use of work computers]." The court explained that under this approach "While it's unlikely that you'll be prosecuted for watching Reason.TV on your work computer, you could be [emphasis in original]. Employers wanting to rid themselves of troublesome employees. . . could threaten to report them to the FBI unless the quit. Ubiquitous, seldom-prosecuted crimes invite arbitrary and discriminatory enforcement." The Court rejected this interpretation which would have made regular activity by average citizens as a potential felony and ruled that running afoul of a corporate computer use restriction does not violate the CFAA. It's possible that here a court would use judicial discretion to narrowly interpret the DMCA and reject the broad definitions that are typically advanced by the government.
The Atlantic

Sunday, January 27, 2013

Friday, January 25, 2013

Sabotage! Key Iranian nuclear facility hit?

An explosion deep within Iran’s Fordow nuclear facility has destroyed much of the installation and trapped about 240 personnel deep underground, according to a former intelligence officer of the Islamic regime.

The previously secret nuclear site has become a center for Iran’s nuclear activity because of the 2,700 centrifuges enriching uranium to the 20-percent level. A further enrichment to weapons grade would take only weeks, experts say.

The level of enrichment has been a major concern to Israeli officials, and Prime Minister Benjamin Netanyahu repeatedly has warned about the 20-percent enriched stockpile.

The explosion occurred Monday, the day before Israeli elections weakened Netanyahu’s political control.

Iran, to avoid alarm, had converted part of the stockpile to fuel plates for use in the Tehran Research Reactor. However, days after the recent failed talks with the International Atomic Energy Agency, Iranian officials announced the enrichment process will not stop even “for a moment.”

The regime’s uranium enrichment process takes place at two known sites: the Natanz facility with more than 10,000 centrifuges and Fordow with more than 2,700. The regime currently has enough low-grade (3.5 percent) uranium stockpiled for six nuclear bombs if further enriched.

Get the inside story in Reza Kahlili’s “A Time To Betray” and learn how the Islamic regime “bought the bomb” in “Atomic Iran.

However, more time is needed for conversion of the low-grade uranium than what would be needed for a stockpile at 20 percent. It takes 225 kilograms of enriched uranium at the 20-percent level to further enrich to the 90-percent level for one nuclear bomb.

According to a source in the security forces protecting Fordow, an explosion on Monday at 11:30 a.m. Tehran time rocked the site, which is buried deep under a mountain and immune not only to airstrikes but to most bunker-buster bombs. The report of the blast came via Hamidreza Zakeri, formerly with the Islamic regime’s Ministry of Intelligence and National Security,

The blast shook facilities within a radius of three miles. Security forces have enforced a no-traffic radius of 15 miles, and the Tehran-Qom highway was shut down for several hours after the blast, the source said. As of Wednesday afternoon, rescue workers had failed to reach the trapped personnel.

The site, about 300 feet under a mountain, had two elevators which now are out of commission. One elevator descended about 240 feet and was used to reach centrifuge chambers. The other went to the bottom to carry heavy equipment and transfer uranium hexafluoride. One emergency staircase reaches the bottom of the site and another one was not complete. The source said the emergency exit southwest of the site is unreachable.

The regime believes the blast was sabotage and the explosives could have reached the area disguised as equipment or in the uranium hexafluoride stock transferred to the site, the source said. The explosion occurred at the third centrifuge chambers, with the high-grade enriched uranium reserves below them.

The information was passed on to U.S. officials but has not been verified or denied by the regime or other sources within the regime.

Though the news of the explosion has not been independently verified, other sources previously have provided WND with information on plans for covert operations against Iran’s nuclear facilities as an option before going to war. The hope is to avoid a larger-scale conflict. Israel, the U.S. and other allies already have concluded the Islamic regime has crossed its red line in its quest for nuclear weapons, other sources have said.

However, this information was not revealed for security reasons until several days ago when sources said the regime’s intelligence agency, through an alleged spy in the Israeli intelligence agency Mossad, had learned of the decision to conduct sabotage on Iran’s nuclear sites on a much larger scale than before.

As reported, President Mahmoud Ahmadinejad called an urgent meeting Tuesday with the intelligence minister, the head of Iran’s Atomic Energy Organization and other officials to discuss the threat, and now it’s clear the meeting included the sabotage at Fordow.

Several Iranian nuclear scientists have been assassinated in recent years. Last year, saboteurs struck the power supply to the Fordow facility, temporarily disrupting production. And a computer worm called Stuxnet, believed to have originated in the U.S., set Iran’s plans for nuclear weapons back substantially.

The 5+1 (the United States, Russia, China, Britain, France and Germany) hope to resume talks with Iran over its illicit nuclear program. The talks ended last year after regime officials refused to negotiate.

Sources in the Islamic regime previously have revealed exclusively to WND the existence of:

Court says Obama appointments violate constitution

WASHINGTON (AP) - President Barack Obama violated the Constitution when he bypassed the Senate last year to appoint three members of the National Labor Relations Board, a federal appeals court ruled Friday in a far-reaching decision that could severely limit a chief executive's powers to make recess appointments.

The decision of the U.S. Court of Appeals for the D.C. Circuit marked a victory for Republicans and business groups critical of the labor board. If it stands, it could invalidate hundreds of board decisions over the past year, including some that make it easier for unions to organize.

When Obama filled the vacancies on Jan. 4, 2012, Congress was on an extended holiday break. But GOP lawmakers gaveled in for a few minutes every three days just to prevent Obama from making recess appointments. The White House argued that the pro forma sessions - some lasting less than a minute - were a sham.

The court rejected that argument, but went even further, finding that under the Constitution, a recess occurs only during the breaks between formal year-long sessions of Congress, not just any informal break when lawmakers leave town. It also held that presidents can bypass the Senate only when administration vacancies occur during a recess.

White House press secretary Jay Carney said the administration strongly disagrees with the decision and that the labor board would continue to conduct business as usual, despite calls by some Republicans for the board members to resign.

"The decision is novel and unprecedented," Carney said. "It contradicts 150 years of practice by Democratic and Republican administrations."

Under the court's decision, 285 recess appointments made by presidents between 1867 and 2004 would be invalid.

The Justice Department hinted that the administration would ask the Supreme Court to overturn the decision, which was rendered by three conservative judges appointed by Republican presidents. "We disagree with the court's ruling and believe that the president's recess appointments are constitutionally sound," the statement said.

The court acknowledged that the ruling conflicts with what some other federal appeals courts have held about when recess appointments are valid, which only added to the likelihood of an appeal to the high court.

"I think this is a very important decision about the separation of powers," said Carl Tobias, a constitutional law professor at Virginia's University of Richmond. "The court's reading has limited the president's ability to counter the obstruction of appointments by a minority in the Senate that has been pretty egregious in the Obama administration."

The ruling also threw into question the legitimacy of Obama's recess appointment of Richard Cordray to head the Consumer Financial Protection Bureau. Cordray's appointment, made on the same date, has been challenged in a separate case.

Carney insisted the court's ruling affects only a single case before the labor board and would have no bearing on Cordray's appointment. Obama on Thursday renominated Cordray for the job.

The case challenging the recess appointments was brought by Noel Canning, a Washington state bottling company that claimed an NLRB decision against it was not valid because the board members were not properly appointed. The D.C. Circuit panel agreed.

Obama made the recess appointments after Senate Republicans blocked his choices for an agency they contended was biased in favor of unions. Obama claims he acted properly because the Senate was away for the holidays on a 20-day recess. The Constitution allows for such appointments without Senate approval when Congress is in recess.

But during that time, GOP lawmakers argued, the Senate technically had stayed in session because it was gaveled in and out every few days for so-called pro forma sessions.

GOP lawmakers used the tactic - as Democrats had done in the past - specifically to prevent the president from using his recess power to install members to the labor board and the consumer board. They had also vigorously opposed the nomination of Cordray.

The three-judge panel flatly rejected arguments from the Justice Department's Office of Legal Counsel, which claimed that the president has discretion to decide that the Senate is unavailable to perform its advice and consent function.

"Allowing the president to define the scope of his own appointment power would eviscerate the Constitution's separation of powers," Chief Judge David Sentelle wrote in the 46-page ruling. He was appointed by President Ronald Reagan.

The court ruled that during one of those pro forma sessions on Jan. 3, 2012, the Senate officially convened its second session of the 112th Congress, as required by the Constitution.

Sentelle's opinion was joined by Judge Thomas Griffith, appointed to the court by President George W. Bush, and Karen LeCraft Henderson, who was appointed by President George H.W. Bush.

"With this ruling, the D.C. Circuit has soundly rejected the Obama administration's flimsy interpretation of the law, and (it) will go a long way toward restoring the constitutional separation of powers," said Sen. Orrin Hatch, R-Utah.

GOP House Speaker John Boehner welcomed the ruling as "a victory for accountability in government."

If the ruling stands, it would invalidate more than 600 board decisions issued over the past year. It also would leave the five-member labor board with just one validly appointed member, effectively shutting it down. The board is allowed to issue decisions only when it has at least three sitting members.

Obama used the recess appointment to install Deputy Labor Secretary Sharon Block, union lawyer Richard Griffin and NLRB counsel Terence Flynn to fill vacancies on the labor board, giving it a full contingent for the first time in more than a year. Block and Griffin are Democrats, while Flynn is a Republican. Flynn stepped down from the board last year.

All three vacancies on the labor board had been open for months before Obama acted to fill them.

Sen. Tom Harkin, D-Iowa called the ruling "a radical departure from precedent" and argued that Obama had no choice but to act.

"Throughout his presidency, Republicans have employed unprecedented partisan delay tactics and filibusters to prevent confirmation of nominees to lead the NLRB, thus crippling the board's legal authority to act," Harkin said.

If Obama's recess appointment of Cordray to the newly created consumer board is eventually ruled invalid, it could nullify all the regulations the consumer board has issued, many of which affect the mortgage business.

Thursday, January 24, 2013

$20 trillion shale oil find surrounding Coober Pedy 'can fuel Australia'

SOUTH Australia is sitting on oil potentially worth more than $20 trillion, independent reports claim - enough to turn Australia into a self-sufficient fuel producer.

Brisbane company Linc Energy yesterday released two reports, based on drilling and seismic exploration, estimating the amount of oil in the as yet untapped Arckaringa Basin surrounding Coober Pedy ranging from 3.5 billion to 233 billion barrels of oil.
At the higher end, this would be "several times bigger than all of the oil in Australia", Linc managing director Peter Bond said.
This has the potential to turn Australia from an oil importer to an oil exporter.
"If it comes in the way the reports are suggesting, it could well and truly bring Australia back to (oil) self-sufficiency," Mr Bond said.
State Mineral Resources Development Minister Tom Koutsantonis said there were exciting times ahead for SA's resources industry.

"Shale gas and shale oil will be a key part to securing Australia's energy security now and into the future," he said.

Linc has hired Barclays Bank to find an investment partner for the next stage of the project, costing $150-$300 million.
The company aims to drill up to six horizontal wells to further confirm its figures, but Mr Bond is confident the region will be home to oil production.

The need to build another oil and gas hub, like the Santos production facility at Moomba, depends on the size of the discovery.
"If it really takes off, that's when you start to look at Moomba-type pipelines."
Mr Bond said there was the potential for a US-style "shale oil" boom in SA.
The Wall Street Journal reported last week the US could pass Saudi Arabia as the world's largest oil producer this year, thanks to the shale oil explosion.
Shale oil extraction involves using new technologies to drill vertically and then horizontally for distances of more than one kilometre through shale rocks that contain oil.
The process was once prohibitively expensive but advances have created a new oil boom in the US.
Mr Koutsantonis said: "We have seen the hugely positive impact shale projects like Bakken and Eagle Ford have had on the US economy.
"There is still a long way to go, but investment in unconventional liquid projects in South Australia will accelerate as more and more companies such as Linc Energy and Altona prove up their resources."
Mr Bond said the potential in SA was "massive", but even at the lower end of estimates - about 3.5 billion barrels - it was still very large.
"If you look at the upper target, which is 103-233 billion barrels of oil, that's massive," he said.
"The opportunity of turning this into the next shale boom is very real.
"If the Arckaringa plays out the way we hope it will, and the way our independent reports have shown, it's one of the key prospective territories in the world at the moment." Mr Bond said each well could flow at 1000-2000 barrels per day.
"You put in 50 of them and that's a lot of oil," he said. "We have a very good idea that this will be an oil-producing asset."
Mr Bond said Linc had so far spent about $130 million in the Arckaringa Basin, drilling four deep wells and "a couple of dozen" shallower wells.
British company Altona Energy was scheduled to start drilling this month to discover more resources for a proposed coal to liquids and power project also in the Arckaringa Basin.
That project, which could cost up to $3 billion, would involve an open-cut coal mine and possibly a 560 megawatt power plant.
The Linc Energy reports, from consultants DeGolyer and McNaughton and Gustavson Associates, are available on the Australian Securities Exchange website.

Fed’s Holdings of U.S. Gov't Debt Hit Record $1,696,691,000,000; Up 257% Under Obama

( - In data released Thursday afternoon, the Federal Reserve revealed that its holdings of U.S. government debt had increased to an all-time record of $1,696,691,000,000 as of the close of business on Wednesday.

The Fed's holdings of U.S. government debt have increased by 257 percent since President Barack Obama was first inaugurated on Jan. 20, 2009, and the Fed is currently the single largest holder of U.S. government debt.

As of the end of November, according to the U.S. Treasury, entities in Mainland China owned about $1,170,100,000,000 in U.S. government debt, making China the largest foreign holder of U.S. government debt.

When Obama was inaugurated in 2009, the Fed owned $475.322 billion in U.S. government debt. As of the close of business on Wednesday, Jan. 23, the Fed owned $1.696691 trillion in U.S. government debt, up $1.221369 trillion during Obama's first term.

Since Obama has been president, the publicly held portion of the U.S. government debt (as opposed to the "intragovernmental" deb the government has borrowed from federal trust funds such as the Social Security Trust Fund) has increased by $5,264,245,866,257.40. The $1.221369 in additional U.S. government debt the Fed has purchased during Obama's presidency equals 23 percent of all the new publicly held debt the Treasury has issued during that time.

Monday, January 21, 2013

Revolutionizing Military Manufacturing

Jan. 18, 2013 — Inventors from across the country can enter a national competition to design a new amphibious infantry fighting vehicle for the U.S. Marine Corps and Vanderbilt University's Institute for Software Integrated Systems (ISIS) is playing a key role in the development of the engineering software that makes the challenge possible.

The Defense Advanced Research Project Agency (DARPA) commissioned the development of the open source software, released it to the public this week and challenged all comers to enter the first stage of a $4-million dollar competition to design the new military vehicle.

The open-source software and the competition are both part of DARPA's Adaptive Vehicle Make (AVM) program, which has the goal of dramatically reducing the costs and lead times involved in developing new military vehicles by radically transforming the existing design and manufacturing process.

Vanderbilt University's multiple key roles in the AVM program include lead developer of VehicleFORGE, a cloud-based collaboration hub where designers can organize project teams. ISIS is also the lead integrator and developer for the META-X project that provides the open-source tool used in creating, testing and validating those designs. The META-X tool, known as CyPhy, includes software that analyzes interactions between individual design components to determine how well they work together.

The program also includes a model library that holds the digital designs of a number of basic components, like wheels, bearings and transmissions. The library developed by Ricardo, a Detroit-based engineering and technical consulting company, and its components are tested, readied for the competition and provided to competing teams by Vanderbilt through VehicleFORGE.

The Foundry is another part of AVM, which uses the latest tools to turn digital models into actual vehicles, and is located at the Advanced Research Laboratory at Penn State University.

The DARPA challenge is titled FANG, which stands for Fast, Adaptive, Next-Generation Ground Vehicle. The challenge consists of three competitions of increasing complexity. The first challenge -- which began Jan. 14 and runs through April 22 and has a $1 million prize -- is to design a suitable power train, including engine, drive train, suspension and wheels or treads. The second challenge, which carries another $1 million prize, will be to design the chassis, armored hull, personnel space and related subsystems. The final challenge has a $2 million prize for the best design for an entire vehicle. The agency is inviting individuals, small teams and businesses and major defense contractors to compete.

The first challenge already has attracted more than 850 competitors organized in more than 200 teams.

In the past, fighter aircraft, tanks and other complex military systems have been built in a craftsmen-like process by a small number of highly specialized contractors. A new design is broken down into subsystems designed by different teams. These preliminary designs are integrated, prototyped and tested. The integrated systems rarely meet the requirements so the process is repeated until they do.

This is a costly approach and DARPA is attempting to replace it with the more efficient "correct by construction" process similar to that practiced by the semiconductor industry, which has an impressive track record in getting systems right in the first place.

"This is the kind of innovation that allows separation of design from fabrication. Right now, the design can only be done by a shop that has the integrated capability to do a complete production run. The idea is to detangle design from production and make the entire process more open, innovative and competitive," said Sandeep Neema, research associate professor and ISIS senior research scientist and principal investigator for the META-X project.

ISIS computer scientists and engineers also view this effort in a wider context. They are convinced that it represents the next generation of engineering design where computer modeling, simulation, model verification and automated synthesis become the dominant paradigm.

"We're right on the cusp of really big changes and DARPA's investment in open source tooling for AVM can really help democratize these changes for both current and future generations of engineers," said Larry Howard, ISIS senior research scientist and principal investigator for VehicleFORGE.

Since the time of Henry Ford, manufacturing has been dominated by the economies of scale: the unit cost of making an object can be reduced by making more of them. "This new paradigm can provide many of the advantages of mass production when making one-of-a-kind systems," commented Ted Bapty, ISIS senior research scientist and research associate professor of electrical engineering and computer science.

For such a paradigm shift to occur, it must be adopted by the younger generation. One part of the AVM program is an undergraduate design contest called the Model-Based Amphibious Racing Challenge (MBARC), which is being held on the Camp Pendleton Marine Corps Base in southern California on Jan. 19.

Taliban attacks show Afghan insurgents' resilience

KABUL, Afghanistan (AP) - Taliban suicide bombers carried out a brazen attack in the Afghan capital on Monday, the second in less than a week and a sign that insurgents are determined to keep fighting despite recent overtures of peace from the U.S. and Afghan government.

The nine-hour assault on the traffic police headquarters, which sent heavy black smoke rising over Kabul, was the second such attack in the heart of the snow-covered capital in six days.

It came a week after the Afghan and American presidents agreed that the Taliban should open a political office in the Gulf state of Qatar to facilitate possible reconciliation with the hardline Islamic group. And it occurred just days after Pakistan announced it would release more Taliban detainees to help jumpstart the fragile peace process.

The pre-dawn attack began with two Taliban suicide bombers blowing themselves up at the gates of the police headquarters. Three heavily armed militants, also wearing explosive vests, then stormed the compound, authorities said.

About 90 minutes later, a car packed with explosives blew up near the gate. Such secondary explosive devices often are rigged to timers and designed to kill people responding to the attack.

The three militants who entered the compound battled Afghan security forces for nine hours. Three policemen were killed, said Interior Ministry spokesman Sediq Sediqi. Four traffic policemen and 10 civilians were wounded, he said.

Kabul Police Chief Gen. Mohammad Ayub Salangi said two suicide bombers died at the gate when they detonated their explosive vests, another blew himself up inside the building and two more were shot and killed by security forces before they managed to detonate their suicide vests.

Taliban spokesman Zabiullah Mujahid claimed responsibility for the attack, which he said targeted a police training facility "run by foreign military forces."

The traffic police headquarters is not heavily guarded, though it is located on a square leading to the parliament and close to a zoo. It also is adjacent to the Afghan Border Police headquarters and a police training facility - possibly the insurgents' primary target. The traffic police facility, usually teeming with civilians seeking driver's licenses and vehicle registrations, was nearly empty when the attack began before the morning rush hour.

The Interior Ministry said many of the civilians were injured by the powerful car bomb. Some were in their homes and hit by shattered pieces of glass.

About two hours after the fighting ended, residents ventured out of their homes and shopkeepers arrived at the scene to see if their stores had been damaged. Two photo shops where people had driver's license pictures taken were nearly reduced to rubble. The explosions created a crater in the cement wall of the traffic police compound. Broken glass littered the street. One man shoveled shards into a wheelbarrow outside his damaged shop.

"We just stayed inside, waiting for it to end," said Fida Mohammad, who works at the Finance Ministry and lives just a few houses from the scene.

He said he was awakened by the explosions and car bombing. He and his family were not hurt, but a woman from a neighboring house was hit by a stray bullet, he said.

An Associated Press reporter at the scene said that during the fight a number of large explosions could be heard inside and around the building, along with heavy gunfire.

On Wednesday, six Taliban suicide bombers attacked the gates of the Afghan intelligence service in downtown Kabul, killing one guard and wounding dozens. That operation bore several similarities to Monday's attack, including the use of a secondary car bomb placed outside the government compound.

The attacks occurred despite the Afghan government's push to get the Taliban to the negotiating table and as President Hamid Karzai and the U.S. negotiate for a quicker pullout of American forces.

After a meeting with Karzai earlier this month in Washington, President Barack Obama said the U.S.-led military coalition would hand over the lead for security around the country to Afghan forces this spring - months ahead of schedule. Obama also said he agreed with Karzai that the Taliban should open a political office in Qatar to facilitate peace talks.

Moreover, Pakistan, a powerbroker in the region, said last week that it plans to release more Afghan militant detainees before international troops finish their drawdown in Afghanistan at the end of 2014. Islamabad made the announcement after talks with Afghan and U.S. officials in Abu Dhabi, the capital of the United Arab Emirates. Pakistan is thought to be holding more than 100 Taliban prisoners and has so far released 26.

Kabul has pressed hard for Pakistan to release Afghan detainees, with some officials saying that they hope the released Taliban can serve as intermediaries to help prospective talks gain traction. But Washington is worried that some of the detainees might rejoin the fight if released.

Din't they here O's Speech today?

CIA drone strikes will get pass in counterterrorism ‘playbook,’ officials say

The Obama administration is nearing completion of a detailed counterterrorism manual that is designed to establish clear rules for targeted-killing operations but leaves open a major exemption for the CIA’s campaign of drone strikes in Pakistan, U.S. officials said.

The carve-out would allow the CIA to continue pounding al-Qaeda and Taliban targets for a year or more before the agency is forced to comply with more stringent rules spelled out in a classified document that officials have described as a counterterrorism “playbook.”

The document, which is expected to be submitted to President Obama for final approval within weeks, marks the culmination of a year-long effort by the White House to codify its counterterrorism policies and create a guide for lethal operations through Obama’s second term.

A senior U.S. official involved in drafting the document said that a few issues remain unresolved but described them as minor. The senior U.S. official said the playbook “will be done shortly.”

The adoption of a formal guide to targeted killing marks a significant — and to some uncomfortable — milestone: the institutionalization of a practice that would have seemed anathema to many before the Sept. 11 , 2001, terrorist attacks.

Among the subjects covered in the playbook are the process for adding names to kill lists, the legal principles that govern when U.S. citizens can be targeted overseas and the sequence of approvals required when the CIA or U.S. military conducts drone strikes outside war zones.

U.S. officials said the effort to draft the playbook was nearly derailed late last year by disagreements among the State Department, the CIA and the Pentagon on the criteria for lethal strikes and other issues. Granting the CIA a temporary exemption for its Pakistan operations was described as a compromise that allowed officials to move forward with other parts of the playbook.

The decision to allow the CIA strikes to continue was driven in part by concern that the window for weakening al-Qaeda and the Taliban in Pakistan is beginning to close, with plans to pull most U.S. troops out of neighboring Afghanistan over the next two years. CIA drones are flown out of bases in Afghanistan.

“There’s a sense that you put the pedal to the metal now, especially given the impending” withdrawal, said a former U.S. official involved in discussions of the playbook. The CIA exception is expected to be in effect for “less than two years but more than one,” the former official said, although he noted that any decision to close the carve-out “will undoubtedly be predicated on facts on the ground.”

The former official and other current and former officials interviewed for this article spoke on the condition of anonymity because they were talking about ongoing sensitive matters.

Obama’s national security team agreed to the CIA compromise late last month during a meeting of the “principals committee,” comprising top national security officials, that was led by White House counterterrorism adviser John O. Brennan, who has since been nominated to serve as CIA director.

White House officials said the committee will review the document again before it is presented to the president. They stressed that it will not be in force until Obama has signed off on it. The CIA declined requests for comment.

The outcome reflects the administration’s struggle to resolve a fundamental conflict in its counterterrorism approach. Senior administration officials have expressed unease with the scale and autonomy of the CIA’s lethal mission in Pakistan. But they have been reluctant to alter the rules because of the drone campaign’s results.

The effort to create a playbook was initially disclosed last year by The Washington Post. Brennan’s aim in developing it, officials said at the time, was to impose more consistent and rigorous controls on counterterrorism programs that were largely ad-hoc in the aftermath of the Sept. 11 attacks.

Critics see the manual as a symbol of the extent to which the targeted killing program has become institutionalized, part of an apparatus being assembled by the Obama administration to sustain a seemingly permanent war.

The playbook is “a step in exactly the wrong direction, a further bureaucratization of the CIA’s paramilitary killing program” over the legal and moral objections of civil liberties groups, said Hina Shamsi, director of the American Civil Liberty Union’s National Security Project.

Some administration officials have also voiced concern about the duration of the drone campaign, which has spread from Pakistan to Yemen and Somalia where it involves both CIA and military strikes. In a recent speech before he stepped down as Pentagon general counsel, Jeh Johnson warned that “we must not accept the current conflict, and all that it entails, as the ‘new normal.’ ”

The discussions surrounding the development of the playbook were centered on practical considerations, officials said. One of the main points of contention, they said, was the issue of “signature strikes.”

The term refers to the CIA’s practice of approving strikes in Pakistan based on patterns of suspicious behavior — moving stockpiles of weapons, for example — even when the agency does not have clear intelligence about the identities of the targets.

CIA officials have credited the approach with decimating al-Qaeda’s upper ranks there, paradoxically accounting for the deaths of more senior terrorist operatives than in the strikes carried out when the agency knew the identity and location of a target in advance.

Signature strikes contributed to a surge in the drone campaign in 2010, when the agency carried out a record 117 strikes in Pakistan. The pace tapered off over the past two years before quickening again in recent weeks.

Despite CIA assertions about the effectiveness of signature strikes, Obama has not granted similar authority to the CIA or military in Yemen, Somalia or other countries patrolled by armed U.S. drones. The restraint has not mollified some critics, who say the secrecy surrounding the strikes in Yemen and Somalia means there is no way to assess who is being killed.

In Yemen, officials said, strikes have been permitted only in cases in which intelligence indicates a specific threat to Americans. That could include “individuals who are personally involved in trying to kill Americans,” a senior administration official said, or “intelligence that . . . [for example] a truck has been configured in order to go after our embassy in Sanaa.”

The playbook has adopted that tighter standard and imposes other more stringent rules. Among them are requirements for White House approval of drone strikes and the involvement of multiple agencies — including the State Department — in nominating new names for kill lists.

None of those rules applies to the CIA drone campaign in Pakistan, which began under President George W. Bush. The agency is expected to give the U.S. ambassador to Pakistan advance notice on strikes. But in practice, officials said, the agency exercises near complete control over the names on its target list and decisions on strikes.

Imposing the playbook standards on the CIA campaign in Pakistan would probably lead to a sharp reduction in the number of strikes at a time when Obama is preparing to announce a drawdown of U.S. forces from Afghanistan that could leave as few as 2,500 troops in place after 2014.

Officials said concerns about the CIA exemption were allayed to some extent by Obama’s decision to nominate Brennan, the principal author of the playbook, to run the CIA.

Brennan spent 25 years at the agency before serving as chief counterterrorism adviser to Obama for the past four years. During his White House tenure, he led efforts to impose a more rigorous review of targeted killing operations. But he also presided over a major expansion in the number of strikes.

CIA officials are likely to be “quite willing, quite eager to embrace” the playbook developed by their presumed future director, the former administration official said. “It’s his handiwork.”

Brennan’s confirmation hearing before the Senate Intelligence Committee is scheduled for Feb. 7.