Necessary News

All you need to know to sound brilliant

Power-Sharing in Zimbabwe

• In a historic move, Zimbabwe’s President Robert Mugabe has signed a power-sharing deal with opposition leader and his long-time rival, Morgan Tsvangirai. [BBC]
• Complete details and content of the deal haven’t yet been confirmed, but reports say that it proposes a 50-50 division of power, with Mugabe staying on as head of state and head of the cabinet.
• Tsvangirai will lead a council of 16 ministers which is responsible for the day-to-day affairs of the country.
• The deal also calls on the UK to pay compensation to the white farmers who have lost their land under President Mugabe’s controversial land reform process.
• Mbeky confirmed that the agreement is not final. “Some discussions have already started about the constitution of this inclusive government, [but] they have not yet concluded,” he said. “I am confident that they will do so as soon as possible.”
• Tsvangirai said the agreement provided the best hope for Zimbabwe, and Mugabe said he was committed to national unity and would do “his best".
• In Tsvangirai’s words: “I’ve signed this agreement because I believe it represents the best opportunity for us to build a peaceful and prosperous democratic Zimbabwe.”

Despite painful compromise and continuing instability, many in Africa hope that the compromise will lead to long term stability in Zimbabwe.

The Economic Melt-Down, Day One

• Economic turmoil and unease sent the stock market reeling yesterday, as the Dow dropped 4.4 percent or 504.48 points. [NY Times]
• The stock market drop “is the Dow’s sixth-largest point drop ever, according to the Associated Press.” [Washington Post]
• It was the worst day for the stock market since September 17, 2001, the first day the market opened after the attacks of 9/11. [USA Today]
• What does that mean to you? Put it this way – the drop in the stock market yesterday represented a loss of more than $700 billion in shareholder wealth.
• Merrill Lynch was purchased by Bank of America for $50 billion, or $29 a share. The company still faces massive lay-offs.
• Lehman Brothers wasn’t so lucky. The investment giant was forced to declare bankruptcy. Yesterday, shares of its stock fell $3.44 to 21 cents.
• The Wall Street Journal asked, “Where was Lehman’s board?” Here’s the answer: “Nine of them are retired. Four of them are over 75 years old. One is a theater producer, another a former Navy admiral. Only two have direct experience in the financial-services industry.” [WSJ]

To hear what the candidates had to say about the crisis, check out the front page of today’s Mic Check under “Eavesdrop.”

The McCain Dream Team

• In a head-scratching moment yesterday, the same day the U.S. financial system was rocked by the double-whammy of Lehman Brothers’ bankruptcy and Merrill Lynch’s buy-out, Johm McCain announced “The fundamentals of the economy are strong.” [9/15/08]
• That made our buddies at The Wonk Room curious. Sen. McCain has already admitted that economics isn’t his “thing,” so we know he’s getting information from his economic advisors. Who are these people telling him everything is right as rain? The Wonk Room decided to find out. [The Wonk Room]
• Phil Gramm: McCain’s “Econ Brain,” who called America “a nation of whiners” in a “mental recession,” former-Senator Gramm was behind the Commodity Futures Modernization Act and the Gramm-Leach-Bliley Act. The former made legal “The mortgage swaps distancing the originator of the loan from the ultimate collector,” while the latter “destroyed the Depression-era barrier to the merger of stockbrokers, banks and insurance companies.” As The Nation wrote, “those two acts effectively ended significant regulation of the financial community.”
• Rick Davis: Before becoming McCain’s campaign manager, Davis “served as president of an advocacy group led by Fannie Mae and Freddie Mac that defended the two companies against increased regulation.” As noted in the Progress Report, “During his tenure, Davis moved to challenge even the smallest measures to make sure that Fannie Mae and Freddie Mac are be held more accountable for their actions.”
• Donald Luskin: Like McCain, Luskin believes that “things today just aren’t that bad,” and everyone should “quit doling out that bad-economy line.” In a Washington Post Op-ed on Sunday, he wrote that “we have surely become a nation of exaggerators,” despite agreeing that “the foreclosure rate is the worst since the Great Depression.”
• Douglas Holtz-Eakin: Though occasionally exhibiting an off-message honest streak (like admitting that McCain will have to raise taxes), this former director of the Congressional Budget Office now spends his time incorrectly claiming that McCain will balance the budget by the end of his first term, trying to justify the $2.8 trillion gap between McCain’s economic proposals and what he says on the stump, and saying “Main Street is hanging in there,” despite significant evidenceto the contrary.
• Carly Fiorina: As CEO of Hewlett-Packard (HP), Fiorina exploited a corporate loophole to hold more than $14 billion in profits overseas, a loophole that McCain is against closing. She was forced out of HP after a merger with Compaq “failed to bring Hewlett the profits that Ms. Fiorina had forecast,” resulting in “tumbling shares.”
• Nancy Pfotenhauer: As the Wonk Room has previously noted, Pfotenhauer’s resume includes work for “Americans for Prosperity (founded by Koch), and the Independent Women’s Forum (funded by Koch).” On the IWF/AFP agenda, and one of the major facets of McCain’s economic plan, is a cut in the corporate tax rate, which will deliver $175 billion in tax breaks to America’s corporations.
• William Timmons: A consummate Washington insider, Timmons, who McCain tapped to head his presidential transition team, was a lobbyist with Timmons and Co., and lobbied for, among others, Freddie Mac. According to Time, “He has registered to work on bills that deal with the regulations of troubled mortgage lenders Freddie Mac and Fannie Mae.”

Sometimes, the Dream Team becomes the Nightmare...

Good News, Bad News

Oh wine. A single glass can protect the heart and help you relax from a long day. That is, if you’re not one of the unfortunate souls for whom a glass of wine can trigger a wheezing attack with a bad headache, flushed face and runny nose. Turns out, between the grapes and the sulfites, a number of people have reactions to wine that range from annoying to seriously unpleasant. [ABC]

GOOD NEWS

More wine for the rest of us!

BAD NEWS

We just feel sorry for the poor teenager who has a sneezing fit if she comes within a few feet of a glass of wine— she can’t ever travel to Italy!

Quote Of The Day

“We could have gone to Congress, hat in hand, the judicial branch and the executive together, and gotten any statutory change we wanted in those days, I felt like. But they wanted to demonstrate that the president’s power was supreme.”

— U.S. District Judge Royce Lamberth, the head of the special surveillance court at the start of Vice President Dick Cheney’s plan to wiretap Americans without first receiving a warrant. [Washington Post]

Speed Round

BUSH WELCOMES GHANIAN PRESIDENT

President Bush on Monday gave the full White House treatment on Ghanian President John Kufuor, a West African ally who holds a kinship with the U.S. president as their two-term tenures near a close. The U.S. pumps hundreds of millions of dollars into Ghana to help fight disease, build roads, train teachers and expand markets for its crops. [USA Today]

BUSH: IKE HAS HURT DRIVERS ACROSS THE NATION

In a statement given on Monday, President Bush acknowledges the fact that Hurricane Ike has put “a pinch” on nation’s energy supply and that drivers across the country would feel the immediate effects from the storm at the gas pump.

HAS BIDEN SEEN THE DARK KNIGHT?

“Folks, we’ve seen this movie before and we know the sequel is always worse than the original."—Joe Biden on how he feels John McCain would be like a sequel to a movie. We don’t know how happy producers of “The Dark Knight” would feel about the comment.

MORE JOB CUTS

Hewlett-Packard Co. says it plans to cut 24,600 jobs, or about 7.5 percent of its work force, over the next three years. Most of the cuts will come from within EDS’s ranks, and nearly half will hit jobs in the U.S.[MSNBC]

PAY UP

Documents obtained through the FOIA, show that federal employees and retirees, including 58 White House employees and 1,000 Capitol Hill workers, did not pay more than $3.5 billion in taxes owed last year. The agency with the most delinquent employees was the U.S. Postal Service, with nearly 4.2% of its 747,000 workers not paying up. [FOX News]

RESIGN

Secretary Ann Williamson, the head of Louisiana’s Social Services Department, resigned after facing harsh criticism from Gov. Bobby Jindal over the way her agency performed during Hurricane Gustav. Jindal went public with his complaints about the lack of showers at shelters and the long lines some evacuees had to endure while waiting for food stamps. [USA Today]

HANDOVER

Secretary of Defense Robert Gates made his eighth visit to Iraq yesterday to transfer command of the ongoing war from Gen. David Petraeus to Lieutenant-General Ray Odierno, telling reporters, “The challenge, I think, for General Odierno is: How do we work with the Iraqis to preserve the gains that have already been achieved, expand upon them, even as the numbers of U.S. forces are shrinking?” [Washington Post]

NO MORE KINGS!

Check out this new poll by AP and the National Constitution Center, which finds “Americans strongly oppose giving the president more power at the expense of Congress or the courts, even to enhance national security or the economy.” [AP]

WITHOUT A PARACHUTE

The federal government this week told the departing CEOs of Fannie Mae and Freddie Mac that they would *not* be receiving their so-called “golden parachutes,” tidy little severance pay packages worth $9.8 million and $14.9 million respectively. [MSNBC]

AID FROM CONGRESS

“The devastation caused by Hurricane Ike demands a swift federal response. Congress will move quickly to pass emergency disaster assistance funds to help those in Texas and other states affected by this tragedy.”—-Nancy Pelosi, to Congress, on providing aid to victims of Hurricane Ike. [The Hill]

VICTORY FOR THE PARKS

U.S. District Judge Emmet Sullivan yesterday said no way to a new plan to allow twice as many snowmobiles tear up the ground in Yellowstone National Park this winter, saying the increase was “contrary to law” and ordering the National Park Service to change the policy. [Salon] [How Snowmobiles Harm The Park]

$5 MILLION

The amount the United States says that Cuba has rejected in relief assistance for rebuilding for recovery after Hurricanes Ike and Gustav. Cuba originally said that it rejected $100,000 dollars in aid. [USA Today]

BEST-BUYOUT

The Merrill Lynch buy-out wasn’t the only one we were talking about yesterday – Best Buy also decided to buy the troubled Napster music franchise for a cool $121 million…cash. [Reuters]

$2.9 BILLION

The bill to colleges and taxpayers for trying to bring students taking remedial classes up to speed on material they were supposed to learn in high school. A new study found that more than one-third of college students with a high school diploma may not be ready for college and have to enroll in classes to catch them up to speed. [ABC News]

TRAGIC

An unidentified gunmen kidnapped two Somali employees of the U.N.’s World Food Program, bringing the number of humanitarian aid workers kidnapped this year to 20. [LA Times]

CUT BACK

Part-time jobs at local clothing stores during Christmas may become scarce. U.S. retail hiring for the upcoming holiday season could be the weakest since 2001 as stores aim to rein in costs, global employment consultancy Challenger, Gray & Christmas said on Monday. [Reuters]