Insider Report
Headlines (Scroll down for complete stories):
1. Imagining President Reagan’s Response to the ISIS Threat
2. US Could Lose 'Competitive Edge' Over High Corporate Taxes
3. Americans Grade Obama Poorly on Education
4. Dakota Oil Boom Backlogging Grain Shipments
5. Hezbollah Condemns Foley Killing — Despite Its Own History
6. US Running Out of Investor Visas
1. Imagining President Reagan’s Response to the ISIS Threat
Instead of merely criticizing President Barack Obama's lack of an effective national security policy, it might be helpful to imagine the speech President Ronald Reagan might have given in response to the videotaped beheading of American journalist James Foley.
There are many things a great power can do if it has leadership.
August 29, 2014
Speaking at Point Mugu Naval Base, near the Reagan Ranch where he is vacationing, President Ronald Reagan addressed the nation on the beheading of James Foley and the threats from the Islamic State (also known as ISIS).
This was also the site of his address to the nation after the Soviet Union shot down Korean Air Lines Flight 007 with an American congressman aboard.
Text of Reagan Address
My fellow Americans:
We have all been saddened and outraged by the vicious videotape of Islamic State terrorists beheading an American journalist. Our hearts go out to James Foley's family.
However, anger and sympathy are not solutions.
We, the American people, must come together in a righteous determination to defend freedom and civilization from barbarism, savagery, and terrorism.
We must calmly, methodically, and with the same grim determination we brought to winning World War II, implement strategies that eliminate the growing worldwide threat of radical Islamists prepared to kill us as individuals and our values as a civilization.
Some will suggest this exaggerates the threat from the Islamic State. Let me remind them of some hard facts.
There are now an estimated 12,000 terrorists from over 50 countries in the Islamic State-controlled parts of Iraq and Syria. Britain estimates that more than 500 British citizens have joined the Islamic State. Our government estimates that more than 100 Americans are now engaged in enemy activities.
When we remember the death and destruction 19 terrorists achieved on 9/11, we have to take very seriously the threat from more than 12,000 terrorists.
The Chairman of the Joint Chiefs of Staff, General Martin Dempsey, has warned that the Islamic State "has an apocalyptic, end-of-days strategic vision that will eventually have to be defeated."
He has expanded on the danger, saying their vision of a fundamentalist caliphate could "fundamentally alter the face of the Middle East and create a security environment that would certainly threaten us in many ways."
Furthermore, General Dempsey has warned that the Islamic State cannot be defeated only in Iraq. He asserted: "Can they be defeated without addressing that part of the organization that resides in Syria? The answer is no."
In fact, the very existence of terrorists from over 50 countries means we must be thinking in terms of a global campaign to eradicate the virus of Islamic extremism and the spirit of terrorism and barbarism that it is fostering. This is fully as grave a threat to our survival as was Nazism or Communism. With appropriate strategies and consistent policies executed energetically, we can defeat and eliminate the Islamic State and its various allied factions.
The Islamic State and its worldwide terrorist allies have become the focus of evil in the modern world.
Secretary of Defense Chuck Hagel warned that we must take the Islamic State seriously when he reported "they are tremendously well-funded. This is beyond anything we have seen." He went on to assert that "they marry ideology and a sophistication of strategic and tactical military prowess."
That is the scale of the opponent we must defeat.
Yet defeating terrorists and blackmailers is nothing new in American history.
In the very first years of the new American Republic, in May 1791, Secretary of State Thomas Jefferson sent Thomas Barclay, American consul to Morocco, a letter of instructions for a new treaty with Morocco, stating that it is "lastly our determination to prefer war in all cases to tribute under any form, and to any people whatever."
Jefferson hated war and loved peace. He also understood that there were times when vicious opponents give peace-loving people no choice but to engage in a just war. As president he sent the Navy and the Marine Corps to the shores of Tripoli to reject blackmail, defeat piracy, and establish that even a young America could project power in defense of principle and its citizens.
We were saddened but not surprised by the barbaric video of the killing of James Foley. Back in January we noted that the Islamic State leader, Abu Bakr al-Baghdadi, gave a speech in which he warned America: "Soon we'll be in direct confrontation, so watch out for us, for we are with you, watching." Islamic State spokesmen have promised to raise their black flag over the White House.
Because I take very seriously the security of the United States and believe that my highest obligation as president is to protect America, I responded to this direct challenge with a series of quiet steps.
We moved intelligence assets and began monitoring potential Islamic State targets throughout Iraq and Syria.
We began re-establishing ties with both the Sunni tribes in Western Iraq and the Kurdish allies with whom America has worked for decades.
We created an anti-ISIS intelligence network working with Egypt, Jordan, and Saudi Arabia.
We informed the weak, chaotic government in Baghdad that defeating the Islamic State is a higher priority than Iraqi political maneuvering, and we reserved the right to arm, train, and coordinate with any effective group prepared to help defeat the Islamic State.
We moved strategic assets including B-1 and B-2 bombers into position to be prepared to respond decisively to any ISIS outrage.
In response to the deliberately vicious killing of James Foley, we began hitting Islamic State targets in both Syria and Iraq. In the last hour over 200 targets have been hit.
The air campaign in coordination with Kurdish and Sunni Arab ground forces will continue until the Islamic State disintegrates and is incapable of holding territory.
The 12,000 terrorists from over 50 countries should understand as of this date that they can surrender or we will hunt them down. Terrorists who videotape beheadings operate outside the rule of law and in the tradition of eliminating piracy they will be dealt with as outlaws.
We will coordinate with Britain, Egypt, Jordan, and every willing partner to develop a strategy and a set of operating principles for the destruction of extremist terrorism.
When Congress returns I will work directly with its leaders in a bipartisan effort to establish rules for protecting America and defeating this growing cancer of barbarism.
With the bipartisan help of Congress and our allies we will pursue our campaign to destroy the Islamic State with the four principles I outlined immediately after the bombing in Beirut: We will have a clear plan to win. We will develop overwhelming forces among the combined civilized world. We will report to you regularly and work every day to keep the support of the American people for the campaign to destroy terrorism. We will define clearly who the enemy is and they will have no sanctuaries.
In confronting an evil that seeks to kill us and destroy our civilization, our goal must be complete and decisive victory.
The Foley family needs your prayers in this difficult time.
America and the forces of freedom need your prayers in this daunting campaign.
Together, civilization will prevail and barbarism will return to the dustbin of history.
Thank you and good night.
Editor's Note:
2. US Could Lose 'Competitive Edge' Over High Corporate Taxes
The United States is discouraging investment by continuing to impose high corporate tax rates as the rates in the rest of the world are declining, the Tax Foundation warns.
The threat to the American economy from high rates was recently highlighted with the report that Burger King Inc. was in talks to buy Tim Hortons Inc., Canada's biggest seller of coffee and doughnuts, and move its headquarters to Canada to lower its corporate tax burden.
The United States currently has the world's third highest top marginal corporate income tax rate, 39.1 percent — a federal rate of 35 percent plus the average rate among the states.
The only nations with higher top rates are United Arab Emirates (55 percent) and Chad (40 percent).
But America has the highest corporate tax rate among the 34 industrialized nations of the Organization for Economic Cooperation and Development, where the average rate is 25 percent.
Worldwide, the average tax rate is 22.6 percent, meaning the U.S. rate is 16.5 percentage points higher than the average.
Other nations with high rates include Japan (37 percent), France (34.4 percent), Brazil, Pakistan, and India (all 34 percent). The U.S. Virgin Islands, it might be noted, has a rate of 35 percent.
The lowest corporate tax rates are in Uzbekistan and Turkmenistan, 8 percent. The only industrialized nation among the bottom 20 countries is Ireland, where the rate is 12.5 percent, Tax Foundation economist Kyle Pomerleau noted.
But several nations have no corporate taxes at all: Bahrain, Bahamas, and Vanuatu, along with Bermuda, Cayman Islands, and the British Virgin Islands.
Corporate tax rates have been declining across the globe in the past decade, and the current average of 22.6 is down from 29.5 percent in 2004. But the U.S. rate has not changed in more than a decade.
The Tax Foundation concludes: "The corporate income tax rate is one of many aspects of what makes a country's tax code and economy attractive for investment. However, as the rest of the world's economies mature and their tax rates on corporate income continue to decline, the United States risks its competitive edge due to its exceptionally high corporate income tax rate."
Burger King would create the world's third-largest fast-food chain by merging with Tim Hortons. Canada's corporate tax rate is 26.5 percent, significantly lower that America's 39.1 percent.
Bloomberg News observed that "the deal threatens to renew debate over American companies shifting their headquarters internationally in search of a lower corporate tax bill."
Editor's Note:
3. Americans Grade Obama Poorly on Education
The biggest problem facing public schools in America is a lack of financial support, a new poll reveals — but Democrats and Republicans differ sharply on the issue.
For 46 years, the Phi Delta Kappa Educational Foundation has sponsored a poll, in partnership with Gallup, to determine Americans' attitudes toward education in this country.
In the most recent survey, respondents were asked what they consider the most serious problem public schools in their community must deal with. Overall, 32 percent said lack of financial support, up significantly from 21 percent in 2004, and 36 percent of public school parents agreed.
Only 9 percent cited concerns about educational standards, 9 percent said lack of discipline/use of drugs/fighting and gangs, and 8 percent said difficulty in getting good teachers and the need for more teachers.
But more than twice as many Democrats than Republicans, 45 percent to 21 percent, cited a lack of financial support as the biggest problem, and twice as many cited difficulty in getting good teachers. Eleven percent of Republicans cited lack of discipline, compared to 7 percent of Democrats.
Respondents in the PDK/Gallup poll were asked: "President Obama is continuing his second term in office. How would you grade his performance in support of public schools using the A, B, C, D, or Fail scale?"
The results: Just 5 percent gave him an A — down from 9 percent last year — 22 percent a B, 29 percent a C, 16 percent a D, and 27 percent said Fail, up from 18 percent last year and 15 percent in 2011.
Not surprisingly, no Republican respondents gave Obama an A this year and 49 percent said Fail, while only 16 percent of Democrats gave him an A, as did just 2 percent of independents.
Asked to grade the schools in their community, 12 percent of respondents gave them an A, 38 percent a B, 31 percent a C, 11 percent a D, and 6 percent said Fail.
But asked to grade public schools in the nation as a whole, just 1 percent gave them an A, while 51 percent said C, and 10 percent said Fail, up from 6 percent in 2013.
Other findings of the PDK/Gallup survey include:
- 70 percent of those polled favor charter schools, including 62 percent of public school parents.
- 56 percent said the local school board should have the greatest influence in deciding what is taught in public schools, while 28 percent chose the state government and just 15 percent picked the federal government.
- 54 percent believe standardized tests are not helpful to teachers.
- Just 33 percent of respondents favor having teachers use the Common Core State Standards to guide what they teach, while 60 percent are opposed.
Editor's Note:
4. Dakota Oil Boom Backlogging Grain Shipments
Reliance on railroads rather than pipelines to ship North Dakota oil is creating an unforeseen crisis — farmers can't get the freight space on trains that they need to ship their grain, resulting in millions of dollars in agricultural losses.
"If we can't get this stuff out soon, a lot of it is simply going to go on the ground and rot," North Dakota grain farmer Bill Hejl told The New York Times.
Oil production in North Dakota has surged in recent years thanks to fracking and horizontal drilling techniques, and the state now produces about a million barrels a day, with at least 60 percent of it traveling by train to faraway oil refineries. There are few pipelines to ship the oil.
Shipment of crude oil by rail has accelerated to such an extent in the past few years that railroad tank car manufacturers face a 2½-year backlog, McClatchy reported. And North Dakota has overtaken Alaska as the nation's No. 2 oil producer after Texas.
Farmers in North Dakota have relied on railroads to send crops to the ports of Portland, Ore., Seattle, and Vancouver for shipment to Asia, and to East Coast ports for shipment to Europe.
But for the week ending Aug. 22, the Burlington Northern Santa Fe Railway, the state's largest railroad, had a backlog of 1,336 rail cars waiting to ship grain and other agricultural items, and the Canadian Pacific had a backlog of nearly 1,000 cars. That’s according to reports filed by railroads with the federal government.
The grain shipment delays can mean canceled orders from food processors like General Mills who can't wait for the grain they need to make cereal, bread, and other products, the Times reported.
A North Dakota State University study disclosed that farmers would lose $67 million in revenue from wheat, corn, and soybeans from January to mid-April, and about $95 million more in losses are expected if farmers can't ship their remaining inventory of crops.
Worse still, the study was done before the current harvest, which is projected to set a record of 273 million bushels of wheat. The soybean harvest is also projected to set a record, and the corn harvest will be near-record.
Farmers assert that railroads are favoring the more lucrative transport of oil instead of agricultural products, a charge that a Burlington Northern spokesperson denies.
"This rail backlog is a national problem," Sen. Heidi Heitkamp, D-N.D., told the Times. "The inability of farmers to get these grains to market is not only a problem for agriculture, but for companies that produce cereals, breads, and other goods."
Construction of the controversial next phase of the Keystone XL Pipeline — still stalled by the Obama administration — would do nothing to alleviate the problem, since it would deliver oil from Canadian shale oil fields to refineries in the United States but bypass North Dakota.
Editor's Note:
5. Hezbollah Condemns Foley Killing — Despite Its Own History
The Lebanese terrorist group Hezbollah has condemned the murder of American journalist James Foley by Islamic State militants, but Hezbollah itself has a history of kidnapping and murdering foreigners, including Americans.
The Iranian-backed Shiite group issued a statement citing the "heinous murder committed by criminal and terrorist gangs against the American journalist James Foley."
Hezbollah charged that funding ISIS (Islamic State of Iraq and Syria), providing them with weapons, and maintaining a "suspicious silence" about their "horrible crimes" were contributing to the Sunni group's "barbaric actions that are affecting everyone."
But CNS News observes that Hezbollah has also been guilty of "barbaric actions" against foreigners.
In March 1984, William Buckley, CIA station chief in Beirut, was abducted by Hezbollah. Videos sent to U.S. embassies and the CIA showed Buckley being tortured. His body was found seven years later, dumped near the Beirut airport.
In 1988, armed Hezbollah fighters kidnapped U.S. Marine Colonel William Higgins, who was attached to a United Nations peacekeeping force in Lebanon, held him hostage, and tortured him. A year and a half later, the group released a videotape showing Higgins twisting at the end of a rope. His body was dumped alongside a Beirut mosque.
(Imad Mughniyah, the Hezbollah terror chief held responsible for both kidnappings and murders, was killed in a 2008 bombing in Syria.)
Peter Kilburn, an American professor at the American University of Beirut, was kidnapped by Hezbollah in December 1984. His body was found more than a year later, along with the bodies of two British teachers from the university.
Catholic priest Lawrence Jenco spent a year and a half in Hezbollah captivity after being abducted in 1985. "He was chained, beaten, and almost constantly blindfolded," according to a U.S. court that awarded his estate more than $300 million in damages from Iran, Hezbollah's sponsor. "He also withstood repeated psychological torture."
Jenco returned to the United States after his release.
Also in the mid-1980s, Hezbollah seized American journalist Terry Anderson, holding him for more than six years, and CNN journalist Jerry Levin, who was held for nearly a year.
Hezbollah is also suspected of kidnapping and murdering other foreigners between 1982 and 1992, including Christian journalist Mustafa Jeha and German journalist Gabrielle Marian Hulsen.
Hezbollah has consistently denied responsibility for the kidnappings and murders. But a Middle Eastern journalist stated that Hezbollah was "indisputably responsible" for abductions of Westerners despite "attempts to shield its complicity."
Editor's Note:
6. US Running Out of Investor Visas
The United States for the first time is running out of immigrant-investor visas that offer permanent residency to foreigners who fund U.S. projects.
The shortage of visas is due to the huge recent surge in visa requests from Chinese investors.
The Immigrant Investor Program — known as EB-5, the government's fifth employment-based visa preference — was begun in 1990 and allots 10,000 visas each fiscal year to foreigners who invest at least $1 million in a U.S. commercial enterprise.
Investors can commit just $500,000 if the enterprise is in a high-unemployment or rural area, and all projects must create at least 10 jobs for American workers.
U.S. Citizenship and Immigration Services (USCIS) defines a commercial enterprise as a sole proprietorship, partnership, holding company, joint venture, corporation, or business trust.
In return, investors and family members become eligible for green cards, or permanent residency, usually within two years.
Until recently, demand for EB-5 visas was well below the 10,000-per-year mark, The Wall Street Journal reported. In 2003, just 65 visas were issued, and less than 800 were issued as recently as 2007.
But last year, the United States issued 8,564 visas, with more than 80 percent going to Chinese investors.
This fiscal year, the United States is on course to run out of visas before the end of the year, with 85 percent of the visas issued so far going to Chinese investors.
As a result, the visas are now unavailable to Chinese individuals until the 2015 fiscal year, which begins on Oct. 1.
An unprecedented number of visa petitions, 10,375, are awaiting adjudication by the USCIS.
"Such a long backlog will cause problems both for investors and U.S. companies that want EB-5 money to start or finish their projects," Stephen Yale-Loehr, an immigration attorney, told the Journal.
By law, no country is allotted more than 7 percent of the visas available in any year. But a country that doesn't reach its cap can transfer its leftover requests to another country, and that has enabled China to exceed its normal allotment.
Among the projects EB-5 money has helped fund are a Marriott hotel in Los Angeles and the Barclays Center sports and entertainment complex in Brooklyn.
But critics of the EB-5 program say it amounts to a visa-for-sale scheme that benefits the rich by allowing them to go to the front of the green-card line.
"These investors aren't coming for the investment," Yi Song, a lawyer who works with Chinese clients, told the Journal.
"They are coming here for their children to obtain a better education and get residence as an insurance policy."
A recent Fortune magazine article called EB-5 the "dark, disturbing world of the visa-for-sale program."
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