Author Archives: Mccutcheon

Top Headlines in Context: Bank Scandal, Egypt Power Struggle, Sudan Split

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Bank Scandal Turns Spotlight to Regulators, New York Times.

The fallout from the 2008 financial crisis continues. American and British lawmakers are scrutinizing how banks portrayed themselves in late 2007 — whether they manipulated key figures to make themselves appear healthier. Blame is also falling on regulators for not properly investigating at the time. Authorities are now considering action against more than 10 big banks, including JPMorgan and Citigroup.

Egypt Parliament Defies Military, BBC.

In the wake of elections, there is a power struggle going on in Egypt between the various branches of government. The new President is a member of the Islamic Brotherhood. The military relatively distrusts religion and politics and finds its control ebbing — a “competitive dance.”

The Sudans after the split: Divided we fall?, Al Jazeera.

Last year, the civil war in Sudan was all over the news. It pitted northerners against southerners, Arabs against Africans, and displaced tens of thousands. Eventually, independence was put to a vote, and South Sudan seceeded from the North. In the year since, oil revenues are down, the economy is tumbling and the euphoria of independence has given way to the slog of rebuilding a country.

Today’s top story in context: Iran plagued by inflation

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International

Already Plagued By Inflation, Iran is Bracing for Worse. New York Times.

The context, in reverse chronological order:

The next election in Iran is summer 2013.
Iran’s leadership is blaming the West for its problems.
The country is destabilizing.
Iranians are struggling.
Inflation is on the rise.

The United States and its partners institute economic sanctions on Iran.
Iran does not give inspectors full access to its military sites.
International weapons inspectors enter Iran.

Some of Iran’s centrifuges suddenly start speeding up and break.
Israel and the United States partner on a cyber attack to slow down Iran’s nuclear program.
The U.S. talks back Israel from launching a military assault on Iran.
Israel thinks Iran’s close to having a nuclear weapon and considers an attack.

Deep background:
Israel is the U.S.’s closest ally in the Middle East.
Iran believes Israel is not a country and built on stolen land.
Iran spends lavishly on imports.
The Middle East has a lot of oil.

Contextualizer Update

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Happy Monday! Here’s the major headlines for today in context–

Last night, Greek voters elected a new government that is pledging to follow through on the terms of its bailout package.

However, the situation is far from over. (1) Unemployment in Greece is around 22%, which among other things reduces government revenue at a time when it’s already broke; and, (2) It’s unclear if New Democracy (the party that won the most votes) will have enough control of the government to stick to its agenda.

How did Greece get into this mess? For years, the Greek government was spending too much and taking in too little. Tax evasion there is relatively commonplace (e.g., Greek shipping companies are often incorporated outside of Greece and pay no tax to the country) and pensioners have robust rights and benefits. Taken together, they spelled a big fiscal problem. Eventually, Greece’s creditors got skittish and stopped lending it money (amidst a worldwide economic slowdown). The result? The country had insufficient funds and needed a bailout from its Eurozone partners to pay off debts and keep the country going. Which brings us back to today.

And on to Egypt, where the Arab Spring continues.

Egyptians went to the polls yesterday to vote for a new president in a runoff between Mubarak’s former prime minister and an Islamic Muslim Brotherhood candidate (who declared himself the winner). However, as the votes were being counted, the behind-the-scenes power struggle continued between the military and civilian authorities.

This is the latest installment in Egypt’s march to true democracy. Hosni Mubarak, the former “President”/Dictator (who is now close to death and awaiting trial), was overthrown by a popular uprising that the military refused to put down. Once that was over, the military did not want to give up power (it ruled through a military council as an interim government). But it eventually relinquished some control, candidates were put on the ballot, and the voting started. Which brings us back to where we are now.

And finally, a somber note.

Rodney King was found dead in his swimming pool last night amid no evidence of foul play.

King became a figure of history in 1991 after being beaten by police officers — an event that was captured on home video and captured the nation’s attention. The officers were later acquitted and in 1992, the Los Angeles riots began in response.

At that time, King famously asked, “Can we all get along?” and appealed for calm….

A lot changes, a lot stays the same.

We’ll be back with you tomorrow. Contextualizer, over and out.

Morning Headline in Context

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  • Job Growth Slows in March. The economy added 120,000 positions last month which is below what many, including those on Wall Street, were predicting. The result is cause for concern that the economic recovery could be derailed or otherwise long and slow. The result affects the race for President. Unemployment numbers and approval ratings tend to be inversely correlated for whomever’s in charge. In this case, as unemployment numbers rises, Obama sinks.  With 7 months to go until the general election…

Today’s Top Headlines in Context

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  • Rick Santorum: “We are going to win” the Pennsylvania Primary. Whether or not he does, it doesn’t really matter. Mitt Romney is too far ahead. It’s likely that Santorum is staying in the race just to continue getting his social conservative message out there and show he has support for it amongst the public, which helps his political standing.
  • Obama Believes Women Should be Admitted to Augusta. Augusta National is a golf course in Georgia and is the site of one of the major golf tournaments, the Master’s, which is coming up next week. Obama said he believes that women should be admitted to the club and the chairman of Augusta basically said ‘eh.’
  • The United Nations Pressures Syria to Heed Peace Plan. Kofi Annan, a former secretary general of the United Nations, recently brokered a cease fire between the Syrian regime and rebel fighters. Many were skeptical that it would actually work and indeed it hasn’t. And now the U.N. is pressuring both sides to stick to the plan and the truce.
  • U.S. Unemployment Claims Hit Four-Year Low. The latest promising sign that the economy is picking back up, although it continues to advance slowly.
  • Greeks Grapple With the A Very Public Suicide. A 77-year-old pensioneer shot himself in the head outside of the Greek parliament building this week saying that he could no longer bear the burden of his debts. Greece has had to go through a number of austerity measures as part of getting EU loans. The unemployment rate is skyrocketing in the Aegean country.

Top Headlines in Context

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  • Stocks are falling today despite positive employment data. Minutes from a recent meeting of the Federal Reserve Board suggest it is unlikely to inject more money into the economy (known as quantitative easing) as it has done twice already. Most major stock indexes are close to where they were before the financial crisis and are coming off a strong first quarter.
  • Romney sweeps three primaries and begins focusing more on Obama. Mitt Romney won last night in Wisconsin, Maryland, and Washington D.C. and put himself  on the precipice of securing the Republican nomination for President. Now, Romney is focusing his attacks on President Obama. The two would face-off in November in the general election.
  • A suicide bomber detonates in Mogadishu, the Somali capital, derailing hopes for calm. The blast came during the prime minster’s speech at the National Theatre and strikes a contrast with recent news reports that suggested a growing calm in the African country. The blast punctuates the fact that Somalia remains a relatively lawless country and fertile ground for militants, including Al Qaeda, which is partly why it’s of such interest to the United States.

Evening Update / April 3

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Domestic politics are dominating the news cycle today.

Republican voters are heading to the polls in three states: Wisconsin, Maryland, and Washington D.C. to help decide which Republican will challenge Obama in November.

Mitt Romney continues to be the clear front-runner. He is favored in all three states that vote today. But Rick Santorum, Newt Gingrich, and Ron Paul all remain in the race. This is typical. These three know they can’t win but are likely positioning themselves for what comes next. Maybe even a high-up position in a Romney administration, should he win.

In the last election, Hillary Clinton and Barack Obama battled it out until the end. Senator Clinton proved that she had a lot of support. And in the end, she didn’t win the nomination but she is now Secretary of State.

Maybe Santorum and Gingrich are angling for something similar.

Meanwhile, President Obama blasted Republicans in a speech today. No coincidence that he should do so on a day when Republicans are also out voting and politics are likely to dominate the news cycle.

In his speech, Obama was trying to define the choice voters will have this fall. He charged that the Republicans are presenting a “radical vision” for the country that plunges it into “social Darwinism” where the poor lose out.

The background is that Republicans are seeking to cut programs like Medicaid, which provides insurance for the poor, to help balance the budget. And the Democrats would prefer to run up deficits now and keep the safety net intact, rather than roll it back.

Lastly, the phone-hacking scandal that brought down the News of the World, a once wildly popular British tabloid, continues to effect the News Corporation and Murdoch family.

BSkyB, a British satellite broadcaster partly owned by the Murdoch family, said today that James Murdoch, Rupert Murdoch’s son, has resigned as chairman to shield the company from any further fallout.

We’ll see how it plays out.

That’s it for today. See you tomorrow. CONTEXTUALIZER out.

Evening Update / April 2

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Today in the news: a tentative cease fire is reached in Syria; a gunman opens fire at a college in Oakland; Rick Santorum just won’t quit; and the US Supreme Court decides that if you are arrested for a crime, you can be strip searched.

The highest court in the land, the Supreme Court, has been in the news a lot lately. First over the health care law and now this. Today it ruled 5-to-4 that law enforcement officials may strip-search people arrested for any offense, no matter how minor, before admitting them to jails.

Justice Kennedy, writing for the majority, said that courts are in no position to second-guess the judgments of correctional officials who must protect themselves and other inmates. So even if you’re arrested for a misdemeanor, your clothes may still come off.

Meanwhile, at Oikos University, a Christian college in East Oakland, a gunman opened fire this morning leaving at least seven people dead and three others wounded. The Oakland police said that a suspect, described as a man in his 40s, was taken into custody after the shootings.

Turning to politics, the Republican primary race continues. Rick Santorum is dismissing calls for him to drop out and effectively cede the nomination to Mitt Romney. On the trail he says he’s tired about being asked to stop.

Across the world, Kofi Annan, the former head of the United Nations, is trying to broker a cease fire in Syria. The Syrian government has promised that its armed forces will withdraw from population centers by April 10 and stop shooting if the rebels stop too.

It’s unclear whether either side will respect the truce.

Those are the top stories of the day. We’ll see you tomorrow.

CONTEXTUALIZER – out.

Why the Supreme Court is Skeptical About the Constitutionality of the Health Care Law: Precedent

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Overview

The 2010 health care law, known as the Affordable Care Act, would expand coverage to just about all Americans. It would do so, in large part, by mandating that everyone have health insurance. Many Supreme Court Justices are skeptical about whether such a mandate is constitutional, i.e., whether the federal government can require Americans to buy insurance.

After all, if that’s true some ask, what else could they require Americans to buy? They are worried about the precedent this would set.

A Step Beyond?

In the Supreme Court this week the Justices heard oral arguments about the case. The court focused on whether the mandate for Americans to have health insurance is a “step beyond what our cases allow,” said Justice Anthony Kennedy.

The Law

Proponents of the health care law claim Congress has the authority to do so because of its powers to regulate interstate commerce. These powers are given to it by the Commerce Clause in the United States Constitution, which reads:

The United States Congress shall have the power “To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes.”

Essentially, much of Congress’ power to make federal laws derives from this part of the Constitution and the courts have interpreted it as such. But as Kennedy alluded to, with the health care law, is it a step too far in this case?

Going Forward

Based on questioning over the last few days during oral arguments, it is sounding like the mandate will be struck down. It is the lynchpin that makes economics of expanding coverage work and we will find out what happens if it goes down in a few months when the case is officially decided.