World News

July 3, 2008

New York magnate leaves billions to the dogs

NEW YORK (Reuters) - New York hotelier and real estate magnate Leona Helmsley left millions to her beloved dog, Trouble, but she has left billions for the care of dogs in general, The New York Times said on Tuesday.

Helmsley left instructions that an entire charitable trust valued at $5 billion to $8 billion (2.5 billion to 4 billion pounds) and amounting to virtually all of her estate, be used for the care and welfare of dogs, the newspaper said, citing two people who had seen the document and described it on condition of anonymity.

The two people who had seen the document said Helmsley signed it in 2003 to establish goals for the trust that would disburse assets after her death. The first goal was to help indigent people and the second to provide for the care and welfare of dogs, the newspaper said. But a year later, she deleted the first goal.

But all the money may not go to the dogs, the article said. It said the mission statement also has a provision that Helmsley's trustees may use their discretion in distributing the funds, and some lawyers say the statement may not mean much, given that it was not incorporated into her will or the trust documents.

Helmsley, who was known as "the Queen of Mean" because of the way she dealt with her employees, had a soft spot for her dog. But a New York court last month lowered the dog's inheritance to $2 million from $12 million on grounds that Helmsley was mentally unfit when she made her will.

A spokesman for the executors of Helmsley's estate told the Times they did not want to comment on the statement because they were still working to determine the trust's direction.

Helmsley died in August 2007 at age 87. She amassed a fortune in real estate and hotels with her husband, Harry Helmsley, who died in 1997.

Famously quoted as having said "only the little people pay taxes," Helmsley spent 18 months in federal prison for evading $1.7 million in taxes in 1989.

(Writing by Patricia Zengerle; Editing by Eric Walsh)

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Patricia Zengerle - Reuters | Thursday, July 3, 2008

 

Economy sheds jobs for 6th month

WASHINGTON (Reuters) - U.S. employers cut workers from their payrolls for the sixth straight month in June for the longest losing employment streak since 2002, government data on Thursday showed.

A separate report showed new applications for jobless benefits hurdling to 404,000, suggesting further weakness ahead for employment.

U.S. stock futures rallied on the news, while prices on U.S. government debt retreated as investors shifted their attention toward the equities market.

"It shows that the labor market still is very soft. We're not seeing dramatic job cuts, but clearly companies are trying to hold the line on costs," said Gary Thayer, senior economist at Wachovia Securities in St. Louis.

The Labor Department said the unemployment rate held steady at 5.5 percent in June and 62,000 jobs were lost from nonfarm payrolls, bringing jobs shed for the year so far to 438,000 as housing market woes chilled growth.

Analysts polled by Reuters had expected the unemployment rate to edge down to 5.4 percent. Payrolls were forecast to shed 60,000 jobs in June versus a 62,000 loss in May.

Both May and April's count were revised lower, taking their combined job losses to 129,000, compared to an early estimate of 77,000 jobs lost.

TAME WAGES

Average hourly earnings, closely watched by the Federal Reserve as it monitors price pressures to make sure they do not creep into higher wages, edged up six cents, or 0.3 percent in June to $18.01.

This took the year-on-year gain in average hourly earnings to 3.4 percent, the lowest reading since January 2006.

The Fed last week halted an aggressive interest rate cutting campaign, holding rates at 2 percent and warning that inflation risks had risen amid soaring energy and food prices. The central bank had been cutting rates to shield growth from a collapsing housing market.

"It does show that the Fed has to hold policy steady for now. We've now seen job cuts all year long and that suggests that raising interest rates now would probably hurt the economy significantly," said Thayer.

June's decline was also the longest consecutive monthly shrinkage in payrolls since the collapse of the technology stock bubble, when they fell from March 2001 until May 2002 without respite as the economy went through a mild recession.

There were 43,00 job losses in construction in June as the housing slowdown continued to bite, while manufacturing shed 33,000 jobs. Both of these sectors have lost jobs in every month over the past year.

Providers of professional services lost 51,000 jobs as the financial services and real estate industries continued to suffer the country's housing market woes.

Flooding in the Midwest had no impact on June's national employment report, the Labor Department said, holding out the possibility of additional pressure on the jobs market in the coming months as flood-related job losses get counted.

A separate report from the labor department showed that U.S. workers filing new claims for jobless benefits jumped 16,000 last week to 404,000.

The four-week average of new jobless claims, a better gauge of underlying labor trends because it irons out week-to-week volatility, increased for the fourth straight week to 390,500, the highest reading since October 2005 in the aftermath of Hurricane Katrina.

(Reporting by Alister Bull, editing by Joanne Morrison)

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Alister Bull - Reuters | Thursday, July 3, 2008

 

June 24, 2008

McCain adviser apologizes for September 11 comment

FRESNO, California (Reuters) - A top adviser to Republican presidential candidate John McCain apologized on Monday after he was quoted as saying a September 11-type attack before the November election would benefit McCain.

The campaign of Democrat Barack Obama condemned the remark by McCain political adviser Charlie Black, calling it a "complete disgrace."

"I deeply regret the comments, they were inappropriate," Black said in a statement after McCain said that if Black had made such a comment, "I strenuously disagree" with it.

"I recognize that John McCain has devoted his entire adult life to protecting his country and placing its security before every other consideration," said Black, one of McCain's most trusted political advisers.

Fortune magazine said Black, in discussing how national security was McCain's strong suit, had said when asked about another terrorist attack on U.S. soil that "certainly it would be a big advantage to him."

Black's comment to Fortune was a distraction for McCain as he seeks to catch up to Obama in the polls, where Obama leads by about 6 percentage points.

"The fact that John McCain's top adviser says that a terrorist attack on American soil would be a 'big advantage' for their political campaign is a complete disgrace, and is exactly the kind of politics that needs to change," Obama spokesman Bill Burton said.

Massachusetts Democratic Sen. John Kerry, who lost to President George W. Bush in the 2004 election based largely on who would make the country safer, said Black's comment smacked of "the worst of the Rove-Bush fear playbook," a reference to Bush's former political adviser, Karl Rove.

A McCain campaign official said Black did not remember making the particular comment to Fortune but did not dispute the characterization.

The official said Black was speaking in the context that any day on the campaign trail that the theme was national security, was a good day for McCain.

McCain, asked about the magazine article at a news conference, distanced himself from the comment.

"I cannot imagine why he would say it. It's not true," McCain said, adding he had worked hard since the September 11 attack to prevent another such attack. (Additional reporting by Deborah Charles and Caren Bohan; Editing by Peter Cooney)

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Steve Holland - Reuters | Tuesday, June 24, 2008

 

Iran says EU sanctions could hurt nuclear diplomacy

TEHRAN (Reuters) - Iran said on Tuesday new sanctions imposed on it by the European Union over its nuclear plans could hurt diplomatic efforts to resolve the row.

The standoff between the West and the Islamic state has sparked fears of a military confrontation that would disrupt oil supplies. Last week a report said Israel had practiced for a possible strike against Iran's nuclear sites.

But a senior Iranian official denied on Tuesday the rumors of an Israeli attack on his country, which sent stocks lower and oil prices higher.

"No attack against Iran's nuclear facilities has taken place," the official said. In Jerusalem, an Israeli army spokesman said: "We are not aware of any such incident in Iran."

Israel, widely believed to have the Middle East's only atomic arsenal, has described Iran's nuclear program as a threat to its existence.

Western powers suspect Iran, the world's fourth-largest oil exporter, wants to make nuclear arms but Tehran denies this.

On Monday, the 27-nation EU agreed new punitive measures targeting businesses and individuals the West says are linked to Iran's nuclear and ballistic program.

The latest sanctions include an asset freeze on Iran's largest state bank, Bank Melli, and visa bans on senior officials including Defense Minister Mostafa Mohammad Najjar and Gholamreza Aghazadeh, head of Iran's Atomic Energy Organization.

Foreign Ministry spokesman Mohammad Ali Hosseini condemned the move by the EU, still an important economic partner for Tehran even if trade volumes have declined, as "illegal" and made clear it would not slow Iran's nuclear activities.

OIL WINDFALL

Hosseini said the sanctions would strengthen the determination of Iranians "to establish their obvious rights and will not help to create an appropriate atmosphere to resolve the issue through diplomatic channels".

He was referring to separate proposals put forward by Iran and by six world powers intended to defuse the dispute that has helped push up oil prices to record highs.

EU foreign policy chief Javier Solana handed Iran an offer on June 14 of economic and other benefits proposed by the United States, Russia, China, Britain, Germany and France to try to convince it to halt uranium enrichment.

Iranian officials have repeatedly ruled out suspending enrichment, which can have both civilian and military uses.

Their refusal to do so has drawn three rounds of limited U.N. sanctions since 2006 and Western powers have warned of more such measures if Iran rejects the latest offer.

Iran has put forward its own package of proposals aimed at resolving the row, but diplomats say it ignores global concern about its enrichment program.

Analysts say Western companies are becoming more wary of investing in Iran even though its windfall crude export earnings, which its oil minister estimates at $6 billion per month, are helping it to cushion the sanctions impact.

President Mahmoud Ahmadinejad, widely expected to stand for re-election in 2009, is also under increased political pressure at home for failing to rein in annual inflation of 25 percent.

The United States, which has also imposed sanctions on Iran beyond the U.N. resolutions, says it is focusing on diplomatic pressure to thwart Tehran's nuclear plans but has not ruled out military action as a last resort.

On Friday, The New York Times quoted U.S. officials as saying Israel had carried out a large military exercise, apparently a rehearsal for a potential bombing of Iran's nuclear facilities.

(Reporting by Parisa Hafezi; Additional reporting by Jerusalem bureau; Writing by Fredrik Dahl; Editing by Elizabeth Piper)

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Parisa Hafezi and Fredrik Dahl - Reuters | Tuesday, June 24, 2008

 

June 22, 2008

Leaked Israeli drill seen as U.S. pressure on Iran

JERUSALEM (Reuters) - A U.S. leak of an Israeli air exercise reported to be practice for possible bombing of Iran's nuclear sites was seen in Israel on Sunday as a deliberate move to increase pressure on Tehran to halt sensitive atomic work.

"When the diplomacy of economic and political pressure fails to produce results, a shift is made to gunboat diplomacy," wrote Alex Fishman, military affairs correspondent of Israel's biggest newspaper, Yedioth Ahronoth.

"As the Iranian regime discusses the European Union representative's most recent offer to halt its nuclear program in exchange for extensive benefits, the Americans opted to add a bit more pressure in the shape of Israel's air force," he said.

Citing unidentified Pentagon sources, the New York Times said on Friday more than 100 Israeli F-16 and F-15 jets took part in a long-range Mediterranean exercise this month that appeared to be a rehearsal for real missions over Iran.

Israel did not confirm the reported exercise had taken place. But officials said such drills have been commonplace at least since 2005.

Commentator Amir Rappaport, writing in Israel's Maariv daily, said it was likely the Pentagon leak was an attempt "to deter Iran and increase pressure on it to cooperate" with international nuclear watchdogs.

Earlier this month, European Union foreign policy chief Javier Solana went to Tehran to deliver a revised offer of economic and political incentives from the United States, Britain, France, Germany, Russia and China for Iran to stop pursuing technology that could yield atomic bombs.

Iran has made clear it does not plan to stop a uranium enrichment program which it says is aimed at fueling power plants.

ATTACK

Israeli Transport Minister Shaul Mofaz, a former defense chief, told Yedioth several weeks ago that "if Iran continues with its program for developing nuclear weapons, we will attack it".

Israeli Prime Minister Ehud Olmert, stopping short of an explicit threat to strike Iran, has called for "all possible means" to be used to stop its nuclear activities.

An analysis in Israel's Haaretz newspaper said the Olmert government viewed an attack on Iran as a last resort and would not strike without first coordinating its actions with the United States.

"Another variable is international sanctions on Iran. These are being applied sluggishly," Haaretz's Yossi Melman wrote. "But Israel still has not given up hope that Moscow and Beijing will change their policies and impose harsher sanctions."

Israel, which is believed to have the region's only atomic arsenal, bombed Iraq's nuclear reactor at Osiraq in 1981. Last September, it mounted a similar raid against a Syrian site that the United States described as a secret reactor built with North Korean help -- a charge denied by Damascus.

Sam Gardiner, a retired U.S. air force colonel who now stages wargames for various government agencies in Washington, said Iran's nuclear facilities were too distant, numerous and fortified for Israel to tackle unilaterally.

"The United States thinks in terms of around 1,000 'aim points' while an Israeli strike would be against around 100 'aim points,'" he said, adding that such a mission would be "disruptive" rather than "destructive".

(Additional reporting by Dan Williams, Editing by Dominic Evans)

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Jeffrey Heller - Reuters | Sunday, June 22, 2008

 

Oil minister: Saudi Arabia willing to increase oil production if customers request it

JIDDAH, Saudi Arabia (AP) -- Saudi Arabia is willing to produce more oil if customers need it, the kingdom's oil minister said Sunday without citing any specific output increase.

Saudi Arabia, the world's largest oil exporter, has been under intense pressure from the U.S. and other oil consumers to increase its crude output to help slow the soaring price of oil.

The kingdom already announced modest increases and said it would pump 9.7 million barrels a day beginning in July. But those increases have not done much to stem the skyrocketing price of oil, which closed near $135 a barrel on Friday.

The high prices are affecting consumers and economies across the United States, Europe and much of the world. Many countries have experienced social unrest as rising fuel prices have driven significant increases in the cost of food and other basic goods.

The cost of gasoline has also become a sore point in the U.S. presidential race, with U.S. President George W. Bush and Republican candidate John McCain calling for lifting of a long-standing ban on offshore oil and gas drilling to increase domestic oil production. But Democratic candidate Barack Obama has said such steps will do nothing in the short term to ease American consumer's pain.

It was unclear if Oil Minister Ali al-Naimi's remarks Sunday at a high-level oil summit in the port city of Jiddah would quell concerns.

Al-Naimi, who was expected to formally make the announcements in a speech later Sunday, reiterated his government's position that the recent run-up in prices has not been caused by a supply shortage. But he said he also believes each country must do what it can "to alleviate these difficult conditions."

For the remainder of the year "Saudi Arabia is willing to produce additional barrels of crude oil above and beyond the 9.7 million barrels per day which we plan to produce during the month of July, if demand for such quantities materializes and our customers tell us they are needed," al-Naimi said in the speech, a copy of which was obtained by The Associated Press in advance.

Al-Naimi also said that the kingdom was willing to invest to boost its spare oil production capacity above the current 12.5 million barrels per day planned for the end of 2009, reversing previous statements that the country would not go beyond that figure.

"In addition, we have identified a series of future crude oil mega-increments totaling another 2.5 million barrels per day of capacity that could be built if and when crude oil demand levels warrant their development," he said.

The U.S. and other Western nations have put increasing pressure on Saudi Arabia to increase production, saying insufficient oil production has not kept pace with growing demand.

Earlier Sunday, King Abdullah also said Saudi Arabia was not to blame for soaring oil prices and instead pointed his finger at speculators, high fuel taxes in consuming countries and increased oil consumption in developing economies.

"There are several factors behind the unjustified, swift rise in oil prices and they are: Speculators who play the market out of selfish interests, increased consumption by several developing economies and additional taxes on oil in several consuming countries," the king said.

Abdullah urged the summit's delegates to "uncover the truth" and dispel rumors to get the "real and full reasons" behind the skyrocketing price of oil.

Saudi Arabia increased oil production by 300,000 barrels a day in May, and a Saudi official confirmed Saturday that the country would add another 200,000 barrels a day in July -- for a total of 9.7 million barrels a day.

British Prime Minister Gordon Brown also called for future commitments from producers for increased oil and gas supply but urged that all countries should improve energy efficiency and develop alternative sources of energy, including nuclear power.

Earlier Sunday, U.S. Energy Secretary Samuel Bodman again called on Saudi Arabia to increase production, saying it has not kept pace with growing demand.

Bodman said world oil consumption growth has averaged about 1.8 percent per year since 2003 with the largest share of that growth coming from developing countries like China, India and countries in the Middle East, he said.

But for the past three years, global oil production has remained constant at roughly 85 million barrels a day, and OPEC production has remained largely flat, he said in a written statement.

"I believe that most of us agree on one thing: Prices are too high at present. And unless we act, the situation will remain unsustainable," he said in the statement.

The kingdom called for Sunday's unusual meeting in Jiddah between oil producing and consuming nations as a way to show that it was not deaf to international cries that high oil prices have caused social and economic turmoil.

The Gulf nation also has become increasingly concerned that record oil prices could hinder growth in the U.S. and other major industrialized economies, potentially leading to a decline in oil demand and a sharp drop-off in prices.

Also Sunday, Abdullah called for the creation of a $1 billion energy initiative for poor countries to help them combat the rising cost of fuel. He also said Saudi Arabia would contribute $500 million to help give poor countries loans to finance development and energy projects.

Associated Press Writer Donna Abu Nasr contributed to this report.

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Sebastian Abbot - AP | Sunday, June 22, 2008

 

Iran presses on with nuclear enrichment "non-stop"

TEHRAN (Reuters) - Iran is pressing on with uranium enrichment "non-stop", its envoy to the U.N. nuclear agency was quoted as saying on Saturday, despite a world powers' offer of economic incentives to coax Tehran into halting such activities.

The Islamic Republic also appeared to dismiss any suggestion of limiting nuclear work it says is for generating electricity but which the West suspects is aimed at making bombs.

Six major powers, including the United States, last week offered Iran help in developing a civilian nuclear program and other benefits in their latest attempt to resolve a long-running dispute that has helped pushed oil prices to record highs.

Iran's chief nuclear negotiator said Tehran was ready to start negotiations "based on a win-win principle", official media said. Saeed Jalili was also quoted as saying such talks represented a "golden opportunity" to strengthen peace.

But Iran "will not bow to any illogical demands that would deprive it of its rights to continue with its peaceful nuclear activities", he said.

The United States says it is focusing on diplomatic pressure to thwart Tehran's nuclear ambitions but has not ruled out military action as a last resort.

The New York Times on Friday quoted U.S. officials as saying Israel had carried out a large military exercise, apparently a rehearsal for a potential bombing of Iran's nuclear facilities.

The U.N. nuclear watchdog chief, Mohamad ElBaradei, the same day warned a military strike on Iran would turn the Middle East into a fireball.

Iranian government spokesman Gholamhossein Elham, when asked about the report on Saturday, branded Israel a "dangerous regime" but made clear his view that it would not dare attack.

"Such insolence and audacity (against Iran's) interest and territorial integrity is an impossible act," Elham said.

Diplomats said on Friday the six powers had offered Iran preliminary talks on its nuclear program, on condition it limit enrichment to current levels for six weeks in exchange for a freeze on moves towards harsher sanctions.

They said European Union foreign policy chief Javier Solana conveyed the proposal during talks in Tehran on June 14 in which he presented a revised batch of incentives for Iran to stop pursuing technology that could yield atomic weapons.

"FREEZE-FOR-FREEZE"

Asked whether such a "freeze-for-freeze" proposal would be acceptable to Iran, Elham told reporters:

"About suspension, it has been said that suspension of activities and suspension of enrichment is not a logical issue that would be acceptable and in any case the continuation of negotiations will not be based on enrichment suspension."

Iran has repeatedly rejected the sextet's precondition of a full suspension of enrichment-related activity before negotiations to implement the incentives.

Iran says it will review the offer by the United States, Russia, China, Britain, France and Germany but that it will not stop work which can have both civilian and military uses.

Its refusal to do so has drawn three rounds of limited United Nations sanctions since 2006.

"The Islamic Republic of Iran continues with enrichment non-stop," Ali Asghar Soltanieh, Tehran's envoy to the International Atomic Energy Agency (IAEA), told Iran's state broadcaster in an interview.

Iran, the world's fourth-largest oil producer, has steadily expanded enrichment capacity to 3,600 centrifuge machines.

Asked why Iran would need additional centrifuges, Jalili said: "We would need at least 50,000 centrifuges for a small sized power station."

Under the "freeze-for-freeze" proposal, Iran would not expand enrichment capacity by adding centrifuge machines for a six-week period, during which the powers would stop moves to sharpen the mild sanctions already in force, the diplomats said.

The interim period would enable "pre-negotiations" to agree parameters for formal negotiations to put the incentives into effect, once Iran has fully suspended enrichment, they said.

(Writing by Fredrik Dahl; Editing by Richard Balmforth)

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Zahra Hosseinian and Hashem Kalantari - Reuters | Sunday, June 22, 2008

 

Mugabe's rival Tsvangirai pulls out of election

HARARE (Reuters) - Zimbabwean opposition leader Morgan Tsvangirai pulled out of a run-off election against President Robert Mugabe on Sunday, saying a free and fair poll was impossible in the current climate of violence.

Speaking only hours after his opposition Movement for Democratic Change reported its rally had been broken up by pro-Mugabe youth militia, Tsvangirai called on the United Nations and the African Union to intervene to stop "genocide" in the former British colony.

"We in the MDC have resolved that we will no longer participate in this violent, illegitimate sham of an election process," he told reporters in Harare.

The MDC and Tsvangirai, who beat Mugabe in a March 29 vote but failed to win the absolute majority needed to avoid a second ballot, have repeatedly accused government security forces and militia of intimidation and strong-arm tactics to ensure a Mugabe victory in the June 27 poll.

Tsvangirai repeated this on Sunday, saying there was a state-sponsored plot to keep the 84-year-old Mugabe in power.

"We in the MDC cannot ask them (the voters) to cast their vote on June 27, when that vote could cost them their lives," he said.

Tsvangirai, who himself had been detained by police five times while campaigning, said 86 MDC supporters had been killed and 200,000 displaced from their homes.

Mugabe has repeatedly vowed never to turn over power to the opposition, which he brands a puppet of Britain and the United States.

Mugabe, who has ruled since independence from Britain in 1980, has blamed the political violence on the opposition and denies security forces have been responsible for brutal actions.

The veteran leader has presided over a ruinous slide in a once prosperous economy. Millions have fled the political and economic crisis to neighboring states.

The MDC earlier said that thousands of youth militia loyal to Mugabe poured into an MDC rally in Harare on Sunday armed with iron bars and sticks, beating journalists and forcing election observers to flee.

Police had banned the rally, which was to be the highlight of Tsvangirai's stormy election campaign, but a high court in Harare overturned the police ban on Saturday.

INTERNATIONAL PRESSURE

Tsvangirai said he won the March vote outright and only reluctantly agreed to a run-off. The state-run media has refused to run the opposition's political ads and police have blocked some of its rallies.

Tendai Biti, a top MDC official and lieutenant to Tsvangirai, is in custody on a treason charge and other offences that carry a possible death penalty. A magistrate has ordered him held until at least July 7.

There is, however, pressure on Mugabe's government to put an end to the violence.

A growing chorus of African leaders added their voices to concerns that the election will be illegitimate.

Angolan President Jose Eduardo dos Santos, a longtime Mugabe ally, on Friday urged the Zimbabwean leader to allow the election to proceed in a spirit of tolerance and with respect to democratic norms.

(Writing by Paul Simao; Editing by Richard Balmforth)

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Nelson Banya - Reuters | Sunday, June 22, 2008

 

Clinton, Obama could help each other financially

WASHINGTON (AP) - Hillary Rodham Clinton needs Barack Obama's donors to help retire her sizable debt. Obama, who's forgoing public funds for the general election, could use her donors to boost his ample fundraising.

The two former Democratic presidential rivals filed their May fundraising reports Friday - hers awash in red ink and his lacking the high-dollar sizzle of his previous monthly reports.

But if the two have an itch to soothe, they're not yet scratching each other's backs.

How the campaigns can help each other will be a likely topic when Obama, the Democrats' nominee in waiting, meets with Clinton and some of her top fundraisers on Thursday in Washington. The two then plan to campaign together on Friday. But so far, the Obama camp has not devised a Clinton assistance plan.

Asked on Friday whether Obama's finance team had discussed ways to ease Clinton's debt when it met Thursday night in Chicago, Obama communications director Robert Gibbs said "those meetings have focused more on what these two can do together to bring the party together and move it forward than it has on these logistical details."

Clinton and her backers, meanwhile, are eager for some help.

The former first lady, who bowed out of the Democratic contest on June 7, reported a $22.5 million debt at the end of May, more than half of which was a personal loan to her presidential campaign. She lent her campaign nearly $2.2 million in May, bringing her total personal investment in the campaign to $12.175 million. She had $3.4 million cash on hand left for primary spending. She also had more than $23 million for the general election, money her campaign cannot use.

"It's far more productive for Obama to have Hillary 100 percent focused and engaged on campaigning and raising money for him in the fall rather than having to do fundraisers at the same time to retire her debt," said Hassan Nemazee, a Clinton national finance chairman.

"It would clearly make life easier for those of us in the Clinton world who would like to help Senator Obama raise the types of monies that are necessary from the Clinton world to be in a position to point out, 'Look what Senator Obama has done for Senator Clinton.'"

Obama had his weakest fundraising month of the year, collecting $22 million and ending the month with $43 million cash on hand and $304,000 in debts. But $10 million of his available cash can only be spent in the fall after the party national conventions, leaving $33 million for the summer months. Obama's decision to bypass the general election's public finance system allows him to use left over primary money in the fall campaign.

Republican John McCain, who secured his party's nomination in March, raised $21 million in May and had $31.6 million in the bank. The figures place him virtually on same financial footing as Obama - a level of parity that would have been unimaginable just a few months ago.

Still, Obama managed to raise slightly more than McCain while still fighting his way out of the Democratic primary. McCain, on the other hand, has been free to consolidate Republican support since he clinched the nomination more than three months ago and has been on an active fundraising schedule.

Overall, since the presidential campaigns began last year, Obama has raised $287 million, Clinton has raised $209 million and McCain has raised $115 million.

Clinton campaigned actively through the last Democratic primaries on June 3 before succumbing to Obama and is expected to have even greater debt at the end of this month. In a call to donors on Thursday, she said she would concentrate on paying off money owed to vendors, not her personal loans.

Of her $10 million in debts to vendors, nearly half - $4.6 million - is money the campaign owes Clinton adviser Mark Penn and his polling firm. Clinton reported spending nearly $19 million - more than $3 million on media advertising and $3 million on phone banks. She spent more than $5 million on travel.

Obama reported spending $26.6 million in May. His heaviest spending was on advertising - more than $4 million buying time for television commercials. Obama had the most expensive payroll, spending $3.5 million on his staff, more than twice what Clinton spent and more than six times what McCain spent on his payroll.

Obama on Friday defended his decision to be the first major party candidate to turn down public funds in the general election. He said he is expecting McCain to have significant help from the Republican Party and from outside groups, though few outside groups have stepped into the presidential election and those that have have spent little money.

The Republican National Committee, however, ended June with 13 times more money in the bank than the Democratic National Committee. The RNC had $53 million cash on hand to the DNC's $4 million. Both parties are allowed to assist their presidential candidates with coordinated campaigns.

Obama pointed out that both he and his wife have been targeted by independent groups and state party organizations.

"So you know, this isn't speculative on my part," he said. "I think it's something that we've seen in the past and it's something that we continue to be concerned about."

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JIM KUHNHENN - AP | Sunday, June 22, 2008

 

June 18, 2008

Obama rebukes McCain camp on terrorism criticism

WASHINGTON (AP) - A defiant Barack Obama said Tuesday he would take no lectures from Republicans on which candidate would keep the U.S. safer, a sharp rebuke to John McCain's aides who said the Democrat had a naive, Sept. 10 mind-set toward terrorism.

"These are the same guys who helped to engineer the distraction of the war in Iraq at a time when we could have pinned down the people who actually committed 9/11," the presumed nominee told reporters aboard his campaign plane. "This is the same kind of fear-mongering that got us into Iraq ... and it's exactly that failed foreign policy I want to reverse."

The debate between the rival camps echoed the 2004 presidential campaign in which President Bush, Vice President Dick Cheney and other Republicans argued that Democratic nominee John Kerry was soft on terror, a claim that resonated with voters and helped propel Bush to re-election. Democrats complained that the GOP was using the politics of fear.

The Republican argument proved less effective in 2006 when then Bush adviser Karl Rove said the Democrats had a pre-Sept. 11 view of the world and Republicans had a post-Sept. 11 terror attacks perspective. In November of that year, Democrats captured enough congressional seats to seize control of the House and Senate.

On his campaign plane, Obama told reporters that Osama bin Laden is still at large in part because Bush's strategy toward fighting terror has not succeeded.

At issue were comments Obama made in an interview with ABC News Monday in which he spoke approvingly of the successful prosecution and imprisonment of those responsible for the 1993 bombing of the World Trade Center. Obama was asked how he could be sure the Bush administration's anti-terrorism policies are not crucial to protecting U.S. citizens.

Obama said the government can crack down on terrorists "within the constraints of our Constitution." He mentioned the indefinite detention of Guantanamo Bay detainees, contrasting their treatment with the prosecution of the 1993 World Trade Center bombings.

"And, you know, let's take the example of Guantanamo," Obama said. "What we know is that, in previous terrorist attacks - for example, the first attack against the World Trade Center - we were able to arrest those responsible, put them on trial. They are currently in U.S. prisons, incapacitated.

"And the fact that the administration has not tried to do that has created a situation where not only have we never actually put many of these folks on trial, but we have destroyed our credibility when it comes to rule of law all around the world, and given a huge boost to terrorist recruitment in countries that say, 'Look, this is how the United States treats Muslims. ...

"We could have done the exact same thing, but done it in a way that was consistent with our laws," Obama said.

Obama agreed with the Supreme Court ruling last week that detainees in Guantanamo Bay, Cuba, have a constitutional right to challenge their indefinite imprisonment in U.S. civilian courts. McCain derided the ruling as "one of the worst decisions in the history of this country."

McCain aides criticized Obama for talking about using the criminal justice system to prosecute terrorists.

"Senator Obama is a perfect manifestation a September 10th mind-set ... He does not understand the nature of the enemies we face," McCain national security director Randy Scheunemann told reporters on a conference call.

Former CIA Director James Woolsey, who is advising the McCain campaign, concurred, saying Obama has "an extremely dangerous and extremely naive approach toward terrorism ... and toward dealing with prisoners captured overseas who have been engaged in terrorist attacks against the United States."

The Obama campaign countered with its own conference call in which Sen. John Kerry, D-Mass., and Richard Clarke, a counterterrorism official in Republican and Democratic administrations, argued the McCain campaign was emulating Rove.

"I'm a little disgusted by the attempts of some of my friends on the McCain campaign to use the same old, tired tactics ... to drive a wedge between Americans for partisan advantage and to frankly frighten Americans," Clarke said.

Kerry accused McCain of "defending a policy that is indefensible" by siding with Bush's policies, particularly with respect to the Iraq war.

Obama said Republicans could be counted on to do "what they've done every election cycle, which is to use terrorism as club to make the American people afraid to win elections." He said he didn't think it would work this time.

Republicans criticized Obama last year when he said the United States should act on intelligence about top terrorist targets in Pakistan even if President Pervez Musharraf refuses.

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Beth Fouhy reported from New York.

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NEDRA PICKLER and BETH FOUHY - AP | Wednesday, June 18, 2008