Jerome R. Corsi's Blog, page 307

Muslim Brotherhood claim: We've got 'goods on Obama'

U.S. Republican Senators John McCain of Arizona and Lindsey Graham of South Carolina.

NEW YORK – The son of a jailed Muslim Brotherhood leader in Egypt is claiming his father has evidence that will land President Obama in prison.

The claim came as the Obama administration, with the assistance of Sens. John McCain, R-Ariz., and Lindsey Graham, R-S.C., and the open involvement of the No. 2 man at the U.S. State Department, made a concerted effort to see Muslim Brotherhood leaders in Egypt released.

In an interview with the News Agency Anatolia in Turkey, Saad Al-Shater, the son of imprisoned Muslim Brotherhood leader Khairat Al-Shater, said his father “had in his hand” evidence that will put Obama in prison.

In a thinly veiled threat, Saad Al-Shater said a U.S. delegation was sent to Cairo by Obama to press for the release of the imprisoned Muslim Brotherhood leaders, including his father to prevent the release of explosive information.

Arabic-speaking former PLO member Walid Shoebat has translated the report by the Turkish News Agency Anatolia as follows:

In an interview with the Anatolia News Agency, Saad Al-Shater, the son of a Muslim Brotherhood leader, the detained Khairat Al-Shater, said that his father had in his hand evidence that will land the head of United States of America, President Obama, in prison. He stressed that the senior U.S. delegation currently visiting Egypt, knows full well that the fate, future, interests and reputation of their country is in the hands of his father, and they know that he owns the information, documents and recordings that incriminate and would condemn their country. Such documents, he says, were placed in the hands of people who were entrusted inside and outside Egypt, and that the release of his father is the only way for them to prevent a great catastrophe. He stated that a warning was sent threatening to show how the U.S. administration was directly connected. The evidence was sent through intermediaries which caused them to change their attitude and corrected their position, and that they have taken serious steps to prove good faith. Saad also said that his father’s safety is more important to the Americans than is the safety of Mohamed Morsi.

Writing in his blog, Shoebat noted that six different Arabic sources confirmed the interview with Saad Al-Shater and the report of Al-Shater’s claims.

Shoebat said the interview with Saad Al-Shater was Aug. 7, making it likely the reference to the “senior U.S. delegation currently visiting Egypt” was about the trip by McCain, Graham and U.S. Deputy Secretary of State William Burns.

On Aug. 6, with interim Egyptian Vice President Mohamed ElBaradei, the former general director of the U.N. International Atomic Energy Agency, McCain and Graham called Khairat Al-Shater and other jailed Muslim Brotherhood leaders “political prisoners.” They told reporters in Cairo that failing to release Muslim Brotherhood prisoners would be “a huge mistake.”

Egypt’s interim president, Adly Mansour, rebuffed the U.S. delegation’s request, telling reporters in Cairo that it constituted an “unacceptable interference in internal politics.”

On Aug. 6, the Associated Press reported the Egyptian government planned to prosecute Khairat Al-Shater and the other imprisoned Muslim Brotherhood leaders on charges of inciting violence last December when Muslim Brotherhood members attacked sit-in protestors outside then-President Mohamed Morsi’s office, resulting in the deaths of 10 people.

ABC News reported that Burns traveled separately late Sunday night, Aug. 4, to the notorious Tora Prison in the middle of Cairo to meet with Khairat Al-Shater, despite claims by the Muslim Brotherhood that Al-Shater refused to meet.

In an Aug. 6 interview with CNN in Egypt, McCain mentioned jailed Khairat Al-Shater, an openly acknowledged Muslim Brotherhood leader, when asked about individuals who could successfully negotiate a future Egyptian government.

The senators created controversy at a press conference in Cairo broadcast by Al Jazeera when McCain called the July 3 ouster of Morsi a “coup,” a word the Obama administration has resisted.

Shoebat has published evidence documenting Khairat Al-Shater has been implicated in weapons trafficking through the Sinai and into Gaza as well as negotiating prisoner releases in exchange for terrorists.

Former U.S. Attorney Joseph diGenova, legal representative for Benghazi whistleblower Mark Thompson, claimed this week that intelligence officers with knowledge of the attack on the Benghazi consulate believe it was was tied to 400 surface-to-air missiles intended for Syrian rebels that U.S. officials feared could be used to shoot down an airliner or attack a U.S. embassy.

Two weeks after the Benghazi attack, WND was the first to report sources claiming the Benghazi compound was an intelligence and planning center the CIA used to recruit and arm Islamic rebels to fight Syrian President Bashar al-Assad.

Rand Paul warns of Obama 'fast track' to global trade zone

NEW YORK – When it comes to free trade, Sen. Rand Paul, R-Ky., appears to be following in his father’s footsteps.

If President Obama attempts to get “fast-track authority” to push the Trans-Pacific Partnership, or TPP, through Congress before attending the summit meeting of the Association of Southeast Asian Nations, or ASEAN, in October, he can anticipate strong opposition from Rand Paul as well as from the senator’s father, former Republican congressman Ron Paul of Texas.

However, granting to the president fast-track authority violates the Constitution’s separation of powers, charges Washington-based attorney Bruce Fein, an adviser to Sen. Paul.

In a letter addressed to Rep. Walter Jones, R-S.C., Fein wrote that the “constitutionally illicit purpose of the Trade Promotion Authority legislation is to endow the President with a decisive vote over international trade legislation in violation of the separation of powers by usurping the power of the House to determine its own rules.”

“The Trade Promotion Act would give the President an overruling influence over Congress in exercising its power to regulate foreign commerce under Article 1, Section 3, and thus would be unconstitutional,” Fein wrote.

Ron Paul has a long history of opposing attempts by Congress to grant the president fast-track authority, or “Trade Promotion Authority,” as it is euphemistically called.

In 1998, he made a statement on the House floor opposing the granting of fast-track authority to President Clinton.

“The fast-track procedure bill,” he said, according to the Congressional Record, “in addition to creating an extra-constitutional procedure by which international agreements become ratified, sets general international economic policy objectives, reauthorizes ‘Trade Adjustment Assistance’ welfare for workers who lose their jobs and businesses which fail, and creates a new permanent position of Chief Agriculture Negotiator within the office of United States Trade representative.”

On pages 111-112 of his 2001 book “Liberty Defined,” Ron Paul expressed similar conclusions:

Today, trade policy has been taken over by the executive branch and Congress graciously cedes this power. Transferring authority under fast-track legislation defies the intent of the Constitution. Trade treaties are not entered into, since senatorial approval by two-thirds would be required and more difficult to pass. This has led to international trade agreements such as WTO [World Trade Organization], NAFTA, and CAFTA that sacrifice national sovereignty to international governmental organizations.

WND has reported the Obama administration appears determined to ram through Congress not only the TPP but also a similar agreement with the EU, the Transatlantic Trade and Investment Partnership, or TIPP, a key part of a massive trade plan that transcends the vision for a “North American Union,” encompassing both Europe and Pacific Rim nations.

WND has also reported President Obama declared in his 2013 State of the Union address his intent to complete negotiations for a Trans-Pacific Partnership and announced the launch of talks “on a comprehensive Transatlantic Trade and Investment Partnership with the European Union.”

The reason Obama wants to obtain fast-track authority is to permit the administration to negotiate directly all arrangements under the TPP, restricting congressional prerogatives to an up-or-down vote, with the goal of passing it before or shortly after he leaves to attend the October ASEAN meeting in Brunei.

Fast-track authority is a provision under the Trade Promotion Authority that requires Congress to review a Free Trade Act, or FTA, under limited debate, in an accelerated time frame subject to a yes-or-no vote.

Under fast-track authority, there is no provision for Congress to modify the agreement by submitting amendments. Fast-track authority also treats the FTA as if it were trade legislation being negotiated by the executive branch, not as a treaty that would require a two-thirds vote from the Senate. The purpose is to assure foreign partners that the FTA, once signed, will not be changed during the legislative process.

Obama fights for TPP

A report released Jan. 24 by the Congressional Research Service, titled “The Trans-Pacific Partnership Negotiations and Issues for Congress,” makes clear the Obama administration does not have fast-track authority to negotiate the TPP, even though the office of the U.S. Trade Representative is acting as if it were in place:

The present negotiations are not being conducted under the auspices of formal trade promotion authority (TPA) – the latest TPA expired on July 1, 2007 – although the Administration informally is following the procedures of the former TPA. If TPP implementing legislation is brought to Congress, TPA may need to be considered if the legislation is not to be subject to potentially debilitating amendments or rejection. Finally, Congress may seek to weigh in on the addition of new members to the negotiations, before or after the negotiations conclude.

The CRS report makes clear that the TPP is being negotiated as a regional free-trade agreement that U.S. negotiators describe as a “comprehensive and high-standard” FTA. The administration hopes it “will liberalize trade in nearly all goods and services and include commitments beyond those currently established in the World Trade Organization.”

The fact that the Obama administration is treating the TPP like a TPA and not a formal treaty obligation strongly suggests the Obama majority will seek passage of the TPP by a simple majority vote in Congress, not by a two-thirds vote of the Senate, as required for the ratification of a formal treaty obligation. Still, the impact of the TPP will be equivalent to a formal treaty obligation. Agreements made within the TPP will be enable regional authorities to supersede U.S. law.

One of the few remaining strategies left to opponents of the TPP is to make sure Congress rejects any fast-track authority.

International tribunal dispute resolution

A leaked copy of the TPP draft makes clear in Chapter 15, “Dispute Settlement,” that the Obama administration intends to surrender U.S. sovereignty to adjudicate disputes arising under the TPP to an international tribunal.

Disputes involving interpretation and application of the TPP agreement, according to Article 15.7, will be adjudicated by an “arbitral tribunal” composed of three TPP members whose purpose under Article 15.8 will be “to make an objective assessment of the dispute before it, including an examination of the facts of the case and the applicability of and conformity with this Agreement, and make such other findings and rulings necessary for the resolution of the dispute referred to it as it thinks fits.”

The TPP draft agreement does not specify that the arbitral tribunals must render decisions in compliance with U.S. law or that the decisions of the arbitral tribunals are invalid should such decisions violate or otherwise contravene U.S. law.

Investment disputes under the TPP appear to be relegated for resolution to the , an international authority created by 158 nations that are signatories to the ICSID Convention created under the auspices of the World Bank.

The TPP draft agreement specifies that foreign firms from Trans-Pacific signatory countries that seek to do business in the U.S. are exempt from American laws and regulations that would make doing business cost-ineffective, including certain environmental and financial disclosure regulations.

The Obama administration appears intent on creating a judicial authority higher than the U.S. Supreme Court, capable of overruling the decisions of U.S. federal courts regarding foreign corporations.

As a result, foreign companies could operate in a legal and regulatory environment that would give them decided economic advantages over U.S. companies, which would remain subject to American laws and regulations.

Ignored by Romney

During the 2012 presidential campaign, Republican challenger Mitt Romney never made the TPP into a major campaign issue by questioning the authority or intentions of the Obama administration – not even to refute Obama charges that Romney was a “vulture capitalist” who sought to outsource U.S. jobs to the detriment of U.S. workers.

Moreover, his strategists enthusiastically supported the Obama administration’s pursuit of TPP negotiations, objecting only that Japan should not be permitted to join the discussions until it opens its markets more to U.S. competition.

Last month, Japan entered the TPP negotiations as part of Prime Minister Shinzo Abe’s plan to restore Japan’s economy, which has suffered a prolonged downturn since the collapse of its real estate market in the 1990s.

The TPP currently includes Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam, Japan and the United States, nations that together comprise roughly 40 percent of global domestic product and about a third of world trade.

Fast-track authority expired in 1994, but only after President Bill Clinton pushed through Congress the North American Free Trade Agreement in 1993 and what was then known as the “Uruguay Round” of the General Agreement on Tariffs and Trade, or GATT treaty in 1994. In 1997, and again in 1998, the House of Representatives blocked legislation to grant Clinton the fast-track authority he desired to negotiate anticipated free-trade agreements in Latin America and Asia. Fast-track authority was restored by the Trade Act of 2002 under President George W. Bush, only to expire July 1, 2007.

Attorney Fein has represented Edward Snowden in the current controversy over Snowden’s flight to Russia after leaking classified or otherwise confidential National Security Agency information about surveillance practices regarding U.S. citizens.

On June 13, in a press conference attended by Fein, Sen. Rand Paul announced his intention to challenge the constitutionality of the court order that set the stage for the NSA to collect “all American cell phone data all of the time.”

Fein graduated from Harvard Law School with honors in 1972. After a federal judicial clerkship, he joined the U.S. Department of Justice, where he served as assistant director of the Office of Legal Policy. He also was the assistant counsel of the Federal Communications Commission, followed by an appointment as research director of the Federal Communications Commission. He has worked for the American Enterprise Institute and the Heritage Foundation. He currently practices law as Bruce Fein & Associates Inc. in Washington, D.C.

Gold surge bodes ill for economy

The recent increase in gold prices suggest investors are increasingly worried the Federal Reserve may soon back off its current policy of quantitative easing in which it has bought billions of dollars of U.S. treasury debt and mortgage backed securities over the past few years.

In an article published Monday, Tyler Durden of ZeroHedge.com noted investors last week covered an enormous number of options contracts going short on gold futures prices, 23,518 futures contracts in total, suggesting a short-squeeze on gold is starting to solidify.

Short positions on gold futures contracts involve bets an investor makes that the price of gold will drop in the future. If the price of gold does not drop as anticipated, the investor owning a short contract must take a loss by purchasing gold at current prices to close out the contract on the expiration date.

When gold prices increase, investors owning gold futures short contracts risk losing money on the bad bet that the price of gold would have declined between the date the contract was purchased and the expiration date of the contract.

Durden noted the covering of gold shorts occurred last week at the fastest pace seen in the past 13 years.

“The last time shorts collapsed at this fast a rate was in the 1999/2000 period which saw a considerable 33 percent squeeze ramp up in gold prices over the space of three weeks in the fall of 1999,” Durden wrote.

“Notably, the gold short position still remains huge compared to historical values – having fallen back only to the previous all-time high levels,” he continued, noting there was still considerable room for a continued gold squeeze should the price continue its recent rise.

Closed 23,518 gold short futures contracts in August. Thirteen-Year Gap Back to 1999-2000 Illustrated. (Source: Commodity Futures Trading Commission, ZeroHedge.com)

On Monday, the price of gold climbed to a two-week high, increasing as much as 1.5 percent to $1,333.31 an ounce early in the trading session, reaching its highest point since July 31, as recent U.S. economic data pointed to continued sluggish growth.

The surge in gold price was reflected by holdings in SPDR Gold Trust, the world’s largest gold exchange-traded fund, growing by 0.2 percent to 911.13 tons on Friday, the first increase since June 10, in what has amounted to an outflow from the fund of more than 14 million ounces, valued at about $19 billion in current prices.

Meanwhile, U.S. gold futures for December gained $14.70, to $1,326.70 an ounce, suggesting short-sellers have not lost hope the recent increase in the price of gold is temporary.

“The move above $1,300 last week has raised the risk of some additional short-covering, but the technical picture is quite neutral and it could only improve if we see gains pushing prices above the $1,350 level,” Saxo Bank senior manager Ole Hansen told the Fox Business Channel.

Will the Fed soon stop buying U.S. debt?

Despite the Commerce Department’s decision in June to revise downward the GDP growth rate for the U.S. economy during the first-quarter of 2013 to an annual rate of 1.8 percent, signals from within the Federal Reserve Board continue to suggest the Fed may soon to back off quantitative easing. The move could further depress U.S. economic growth and send U.S. stock markets into a steep decline.

Last week, Sandra Pianalto, the president of the Federal Reserve Bank of Cleveland, joined those within the Fed suggesting it was time for quantitative easing to come to a halt.

“Employment growth has been stronger than I was expecting, and the unemployment rate today is more than a half a percent lower than I projected it to be last spring,” Pianalto told an audience in Cleveland last Wednesday. “In light of this progress, and if the labor market remains on the stronger path that it has followed since last fall, then I would be prepared to scale back the monthly pace of asset purchases.”

Charles Evans, president of the Federal Reserve Bank of Chicago, told a breakfast meeting of reporters last Tuesday that he would not rule out the Fed pulling back on its $85 billion-a-month bond-buying program when the Federal Reserve Board holds its next policy meeting in September.

“I clearly would not rule that out,” Evans responded, when asked if the Fed might ease back on bond purchases at the Federal Reserve Board’s policy meeting scheduled for Sept. 17-18. “Considering the cumulative improvement in economic conditions since September 2012, our asset purchases likely will end with the unemployment rate somewhere in the range of 7 percent.”

The U.S. Bureau of Labor Statistics announced the unemployment rate as measured by the standard U-3 index was 7.4 percent in July, the last month for which federal unemployment data has been reported.

As WND has reported, many economists believe the BLS unemployment numbers are manipulated for political reasons. The government’s headline figure removes the long-term unemployed from the ranks of the labor force to lower the U3 unemployment percentage the BLS reports as the monthly unemployment rate. These skeptical economists have argued that a more accurate measure of unemployment is the U6 seasonally adjusted figure – 14 percent in July 2013 – or a measure that adds to U6 the long-term discouraged workers who have not looked for work in more than a year but still consider themselves to be unemployed, which was 22 percent last month.

Reuters reported last week that the downturn of stock prices observed at the end of last year was largely a result of investor concern that a Fed decision to end or reduce substantially the policy of monthly quantitative easing could remove from the economy a major drive behind the equity rally. The surge has boosted the S&P 500 index by about 18 percent so far this year.

“People are concerned about the extent of the [stock market] rally in the short term, and some people are talking about equities being too expensive relative to the underlying fundamentals,” Stephen Massocca, managing director at Equity Management LLC in San Francisco, told Reuters last week.

The next Fed chairman?

Fed Chairman Ben Bernanke, preparing to retire at the end of this year, compounds uncertainty over the Fed.

The top contender to replace Bernanke is widely considered to be Janet Yellen, the current Fed vice chairman, a proponent of quantitative easing who would be expected to perpetuate Bernanke’s policy as long as concerns remain strong in equity markets that the U.S. economy is too week to sustain strong, long-term growth.

Yellen’s main competitor for Bernanke’s job is former Harvard president Larry Summers, who served as secretary of the treasury from 1999 to 2011 under President Clinton and was director of the White House U.S. National Economic Council from January 2009 to November 2010 under President Obama.

On Wall Street, Summers is widely thought to be hostile to a policy of continued quantitative easing.

“There’s certainly anecdotal evidence of yield chasing by investors who are seeking to earn greater than completely safe rates of return,” Summers explained to a breakfast hosted last month by the Wall Street Journal. “To what extent that reflects desirable increases … and what extent that reflects movement towards bubbles is a judgment that … monetary policy authorities will have to make over time.”

Reporting on the speech, Stephen Gandel, senior editor at Fortune Magazine noted Summers has dismissed concerns brought up by investor Warren Buffett and others that ending quantitative easing could shock stock markets by causing interest rates to take a big jump.

WND has reported Summers may end up being best remembered for having caused Harvard University to lose some $10 billion, approximately 30 percent of its endowment, as a result of misguided instructions during his tenure as president from 2002 to 2006. Summers directed the university’s endowment fund to invest in complicated credit-swap derivative investments that ultimately went sour.

Will Chicago follow Detroit into bankruptcy?

NEW YORK – Chicago, America’s third largest city, could follow Detroit into bankruptcy, warned Mayor Rahm Emanuel in the city’s “Annual Financial Analysis 2013” released last week.

“Until we pass meaningful pension reforms in Springfield, the outlook for future years is unsustainable,” Emanuel concluded bluntly, anticipating a current budget crisis that could develop into a full-fledged budget meltdown within the next four years.

Emanuel noted that Chicago’s current budget deficit of $338.7 million is expected to grow to $1.6 billion by 2016, due largely “to ballooning obligations under current pension legislation.”

Compounding the fact that pensions for public employees are less than 40 percent funded, a decline in business activity during several years of prolonged economic downturn and an exodus of higher income residents from the city have resulted until recently in a dramatic decline in Chicago’s tax revenue.

While Chicago has attempted to cut back on city services, including public school employment and police and firefighters, the city’s operating expenses are plagued by extremely high salaries, with 2,400 municipal employees earning six-figure salaries annually.

Why are most of America’s big cities strongly liberal, while virtually the rest of the country leans conservative? Find out in this jaw-dropping WND special report, “URBAN WARFARE: How the left has destroyed America’s greatest cities.”

Meanwhile, the crisis of gun violence in Chicago, despite the city’s tough gun control regulations, prompted members of Congress from the city to demand last month that the National Guard be called in to stop the “mayhem.”

What is looming in Chicago and Detroit is a crisis of increased Democratic Party-controlled government spending and an era of union-controlled public employment that is causing Democrats to soul-search for solutions that do not involve raising taxes to a level that would cripple the business activity on which much of the government revenue depends.

The New York Times reported that last week Democratic leaders in the legislature sued Democratic Gov. Pat Quinn after he announced he was withholding lawmakers’ paychecks until the legislature came up with a solution to solve the state’s pension crisis.

In July, Moody’s downgraded Chicago’s debt rating by an unexpected two grades because of the city’s large and growing pension obligations and budget pressures related to the pension crisis.

This move will increase Chicago’s cost in financing the city’s $8.2 billion of general obligation and sales tax debt.

“The current administration [of Mayor Rahm Emanuel] has made efforts to reduce costs and achieve operational efficiencies,” Moody’s said in announcing the downgrade, “but the magnitude of the city’s pension obligations has precluded any meaningful financial improvements.”

Pension crisis

Chicago pensions are determined by Illinois state law that sets the contributions and benefits for municipal employees, including teachers in the public schools, firefighters, paramedics and police.

The city’s four pension funds are only 36 percent funded, meaning the amount of money the city contributes falls short on an actuarial basis by $19.5 billion.

The unfunded pension obligation is expected to grow to more than $24.5 billion by 2017 if nothing is done to address the problem.

Since 2000, Chicago’s pension funds took two major hits.

First, when the dotcom bubble burst in 2000, the assets of the funds fell from approximately 87 percent funded to approximately 62 percent funded, due primarily to investment losses.

Then, in 2007 and 2008, the real estate-driven market drove the investment value of the pension funds from approximately 62 percent funded to 38 percent funded.

The underfunding crisis in Chicago’s pension funds has continued to worsen due in part to automatic cost-of-living benefit increases passed by the state in 2010.

Beginning in 2015, Chicago’s budget deficit is likely to grow as the city is required by state law to make far greater contributions to the pension funds, costing the city as much as it would cost to hire another 4,300 police officers.

In managing Chicago’s looming pension deficit crisis, the city and state face a dilemma common to many municipalities nationwide.

Reducing pension obligations involves negotiating with unions that are reluctant to deprive retired and retiring government employees of the benefits they have earned.

Amending future benefits is extremely unpopular with current government union workers forced to change the conditions of their future employment to reduce substantially the benefits they may expect to receive at retirement.

Quickly, images arise of the crisis faced by Wisconsin Gov. Scott Walker when union mobs stormed the state capital in Madison and launched a recall efforts to force him out of office after he demanded a reduction in the pension benefits paid to retired and retiring unionized public employees.

The problem Chicago will soon face as the city’s annual deficit grows from $338.7 million to $1.6 billion by 2016 is that municipal employees not unreasonably want their pension benefits paid as specified by their union contract with the state of Illinois, regardless whether or not the city of Chicago can pay up.

“Given the size of the unfunded liability and the dollar amount that would be required to fully fund, even over many years, tax increases and service reductions cannot be the complete answer,” Emanuel’s annual financial report noted.

Emanuel has pressed for a serious of pension reform proposals in Springfield, arguing that cost-of-living adjustments written into current law are not sustainable and that major changes in benefits paid must be made to protect Chicago taxpayers and the retirement security of its workforce.

“Increased employee contributions need to be phased in, and retirement ages are out of line with reality and do not account for longer life expectancies,” the financial report stressed.

Salary crisis

In addition to the current pension crisis, Chicago faces a salary crisis with its current municipal workforce.

Chicago has dramatically decreased its public employee workforce from 40,506 positions (42,392 full-time equivalents, or FTEs) in 2003 to 32,420 positions (33,554 FTEs) in 2013, a decrease of approximately 20 percent in the past 10 years.

Yet, despite this reduction in workforce, Chicago’s total personnel costs increased by 15 percent between 2003 and 2012, with salary and wage expenses rising by 11 percent and healthcare costs by 38 percent.

Today, 90 percent of Chicago employees are represented by a union, up from 87 percent in 2003.

Chicago engages in collective-bargaining negotiations with 40 different unions. The Fraternal Order of Police and the Chicago Firefighters Union are the two largest, with 17,482 public safety positions, including police captains, lieutenants and sergeants.

Payroll, Chicago’s single highest expense, totals $2.4 billion, with 2,400 city employees, not including school employees, making more than $100,000 a year.

Payroll costs are expected to increase $100 million in 2014, and no discussions are underway about making any cuts to any municipal employee salaries.

Chicago’s budget deficits could intensify dramatically if the city fails to meet Emanuel’s rosy forecast that the city will increase revenue $466 million in 2014 and $580 million in 2015.

Here's the real unemployment rate

NEW YORK – Are the reports of an Obama economic recovery based on the economy creating mostly part-time jobs and on manipulated government statistics that report an artificially low unemployment number?

According to John Williams, an economist known for asserting the government reports manipulated “shadow statistics” of economic data for political purposes, the real unemployment rate for July 2013 was 23.3 percent, not the 7.4 percent reported by the Bureau of Labor Statistics.

Meanwhile, the House Ways and Means Committee reported Monday that seven of every eight new employees under Obama have been part-time.

Williams, editor of the Shadow Government Statistics website, wrote that the Bureau of Labor Statistics report indicating July unemployment dropped from 7.6 percent in June to 7.4 percent in July was “meaningless.”

“The broad economic outlook has not changed, despite the heavily-distorted numbers that continue to be published by the BLS,” Williams wrote. “The unemployment rates have not dropped from peak levels due to a surge in hiring; instead, they generally have dropped because of discouraged workers being eliminated from headline labor-force accounting.”

Manipulated unemployment rates

Williams’ ShadowStats Alternative unemployment rate includes “long-term discouraged workers,” a category the Bureau of Labor Statistics removed in 1994, under the Clinton administration, from the government’s unemployment measures.

The BLS publishes six levels of unemployment, but only the headline U3 unemployment rate gets the press.

The headline number does not count the “discouraged” workers who have not looked for work in the past four weeks because they believe no jobs are available.

Williams has demonstrated that it takes an expert to truly decipher BLS unemployment statistics. For instance, in a table titled “Alternative measures of labor underutilization,” the BLS reports what is known as “U6 unemployment.”

The U6 unemployment rate is the BLS’s broadest measure. It includes those marginally attached to the labor force and the “under-employed,” those who have accepted part-time jobs but seek full-time employment. Also included are short-term discouraged workers who have not looked for work in the past year because there are no jobs to be found.

Since 1994, however, the long-term discouraged workers, those who have been discouraged for more than one year, have been excluded from all government data.

The BLS was reporting that the seasonally adjusted headline unemployment last month was only 7.4 percent, but it also said the broader U6 seasonally adjusted unemployment was 14 percent.

In his subscription newsletter, Williams has urged caution in interpreting BLS statistics:

“To the extent that there is any significance in the monthly reporting, it is that the economy is not in recovery, and that unemployment has made a new high, at a level that rivals any other downturn of the post-Great Depression era.”

Williams calculates his “ShadowStats Alternative Unemployment Rate” by adding to the BLS U6 numbers the long-term discouraged workers who have not looked for work in more than a year but still consider themselves to be unemployed.

Williams argues that his ShadowStats Alternative Unemployment measure most closely mirrors common experience.

“If you were to survey everyone in the country as to whether they were employed or unemployed, without qualification as to when they last looked for a job, the resulting unemployment rate would be close to the ShadowStats estimate,” Williams explained to WND.

The headline BLS unemployment rate has stayed relatively low because it excludes all discouraged workers, Williams argues.

As the unemployed first become discouraged and then disappear into the long-term discouraged category, they also vanish from inclusion in the headline labor force numbers. Those workers still are there, however, ready to take a job if one becomes available. They consider themselves to be unemployed, but the government’s popularly followed unemployment reporting ignores them completely.

Here is a more complete unemployment table that includes the seasonally adjusted unemployment percentages for U3 unemployment, as well as the same for U6 unemployment, followed by the ShadowStats Alternative Unemployment rate for both December 2011 and December 2012:

Increasingly, critics like Williams believe the seasonally adjusted U3 numbers reported by the BLS as the official monthly unemployment rate do not give a reliable picture of the true magnitude of unemployment in the United States.

The BLS definitions exclude from the definition of unemployed those who have grown so discouraged that they have not actively looked for work in the past year, without distinguishing those who would look for work if there were a reasonable chance they could find employment.

False job-creation numbers

The House Ways and Means report Monday noted the headlines “citing last week’s jobs report as the lowest unemployment rate in years may have been technically accurate, but they are also reminders that looks can be deceiving.”

“The reality, as you dig into the latest jobs data, reveals that few are finding the full-time work they want and need, and many are forced to accept part-time employment.”

To support its argument, the committee produced the following table drawn from Bureau of Labor Statistics:

The committee linked to an article published Sunday by Associated Press economics writer Paul Wiseman that said: “So far this year, low-paying industries have provided 61 percent of he nation’s job growth, even though these industries represent just 39 percent of overall U.S. jobs, according to Labor Department numbers analyzed by Moody’s Analytics.”

Wiseman noted part-time work, less than 25 hours a week, has made up more than 77 percent of the job growth so far this year.

Related column:

“Obama’s ‘recovery’ anything but” by Larry Elder

IRS investigation one step closer to White House

WASHINGTON — The investigation into the IRS practice of targeting conservative groups moved one step closer to the White House today in testimony before the House Oversight Committee.

Career IRS official Carter Hull, a self-described 501(c)4 expert with 48 years experience with the tax agency, testified the IRS chief counsel’s office in Washington demanded information on the 2010 election activity of tea party groups applying for tax-exempt status.

Hull testified that instead of carrying out his recommendations to approve or deny tax-exempt status to conservative groups, Lois Lerner, the director of the IRS Exempt Organizations division, ordered tea party applications to go through a multi-level review that included her senior adviser and the office of the IRS chief counsel, a political appointee.

William Wilkins, one of two Obama administration political appointees at the IRS, leads the IRS chief counsel.

Scapegoating Cincinnati

Also testifying was Elisabeth Hofacre, an IRS official in the Cincinnati office who was assigned to review as many as 60 tea party applications and who coordinated her work with Hull.

She said the review process and extra scrutiny given the conservative groups was so unusual and she was so frustrated by what she saw as micromanagement, she asked for a transfer in July 2010, which was approved in October.

When Issa asked Hofacre how she felt when IRS officials began blaming the scrutiny on conservative groups on “rogue agents” in Cincinnati,  she said she was deeply offended.

She said it hit her like a “nuclear strike.”

Fireworks were provided by Rep. Jason Chavetz, R-Utah, who was visibly upset over the treatment of Hofacre.

He expressed outrage that the White House Press secretary would blame the IRS targeting of conservatives on two agents in Cincinnati and that former acting IRS director Steve Miller would blame two rogue agents.

Chavetz said the most powerful people in Washington were blaming one of the people sitting at the table in front of him, referring to Hofacre.

He said that makes him believe Washington is involved.

“How dare anyone suggest we are at the end (of this investigation) — we are at the beginning,” Chavetz thundered.

Practically shouting, Chavetz said when ranking member Elijah Cummings, D-Md., went on national television and said the investigation should be closed he was wrong.

Chavetz attempted to soften the stinging public rebuke by adding he had the utmost respect for Cummings.

And, indeed, after Chavetz finished his questioning of the witnesses, Cummings walked across the row, took a seat next to Chavetz, and as the two whispered, broad smiles grew over both their faces.

Cummings then slapped Chavetz on the back and departed.

‘Following the facts’

Committee Chairman Darrel Issa took a moment to deny Democrat charges he was targeting the White House and insisted the investigation is just following where the facts lead, but he also insisted the facts now lead to Washington and the IRS counsel’s office.

However, building up to the hearing, Issa and the House Oversight committee, together with majority leadership on the House Ways and Means Committee, indicated they are getting nearer to laying political blame on the White House for delaying the tax-exempt applications of tea party groups, with the intent to keep tea party groups from fully participating in the 2010 mid-term elections.

“As a part of this ongoing investigation, the committees have learned that the IRS Chief Counsel’s office in Washington, D.C., has been closely involved in some of the applications. Its involvement and demands for information about political activity during the 2010 election cycle appears to have caused systematic delays in the processing of tea party applications,” wrote Issa, House Ways and Means Committee Chairman Dave Camp, R-Mich.; Oversight Subcommittee Chairman Jim Jordan, R-Ohio; and Ways and Means Subcommittee Chairman Charles Boustany, Jr., R-La., in a joint letter addressed to IRS director Daniel Werfel.

“[B]ased on his decades of experience, [career IRS official Carter Hull] determined he had enough facts to make recommendations whether to approve or deny the applications … However, Mr. Hull’s recommendations were not carried out. Instead, according to Michael Seto, the head of Mr. Hull’s unit in Washington, Lois Lerner instructed that the tea party applications go through a multi-layer review that included her senior adviser and the chief counsel’s office.”

The House Committee on Oversight and Government Reform has found, according to a website statement posted this week, that according to Hull, sometime in the winter of 2010-2011, the senior adviser to Lerner told him the IRS chief counsel’s office would need to review all tea party applications.

Hull said it was the first time in his 48-year career at the IRS he was told to send an application to Lerner’s senior adviser.

The committee continued, explaining it was not until August 2011 that the chief counsel’s office held a meeting with Hull, Lerner’s senior adviser and other Washington, D.C., officials to discuss these test applications. During the intervening months, the applications languished.

The chief counsel’s office also instructed Hull that it needed updated information to evaluate the applications, the committee said.

Since the applications were up-to-date months earlier, when Hull made his recommendations, Hull testified that he found this request surprising. The chief counsel’s office also discussed the possibility of a template letter to develop all the tea party applications, including those being held in Cincinnati. Hull explained that all the applications were different and that a template was impractical.

Hull’s supervisor, Ronald Shoemaker, provided insight on the type of additional information sought by the chief counsel’s office. The counsel wanted the applicants’ political activities leading up to the 2010 election, the committee reported.

The lengthy review of the test applications in Washington created a bottleneck and caused the delay of other tea party applications in Cincinnati. The committee said IRS employees in Cincinnati – including Hofacre — have said they were waiting on guidance from Washington on how to move the applications forward.

The statement also said Hull explained that he could not provide advice to Hofacre because his hands were tied by his superiors in Washington. Therefore, none of these applications was approved or denied during the time he worked with Hofacre on the cases.

The head of the Cincinnati office, Cindy Thomas, testified that she continuously asked senior Washington officials when guidance was coming, to no avail.

Fraud claim against Holder bolstered after ruling

Allegations of fraud against Attorney General Eric Holder, other top Justice officials, several prominent Democratic operatives – including a major contributor to Hillary Clinton – and Credit Suisse Bank has been re-ignited by a federal bankruptcy judge’s decision that also apparently has derailed the U.S. Senate bid of a former Democrat governor.

The decision July 10 by Judge Bruce A. Markell dismissed a bankruptcy judgment against real estate developer Tim Blixseth.

Blixseth, the founder of the Yellowstone Club, a luxury ski and golf resort in Montana, has alleged that Credit Suisse made a criminally fraudulent loan to Yellowstone Club that led to the bankruptcy judgment, which stripped Blixseth of ownership of the resort. Blixseth alleges he was defrauded by an elaborate scheme engineered by his ex-wife and Ron Burkle, the supermarket king who raised more than $1 million for Hillary Clinton’s 2008 presidential campaign.

Though seemingly unrelated, the bankruptcy decision appears to have prompted former Montana governor Brian Schweitzer to announce Saturday that he does not intend to pursue a bid to run in 2014 for the U.S. Senate. The seat has been held by retiring Democratic Sen. Max Baucus, a prominent proponent of Obamacare who in recent months has described the health care law as “a train wreck.”

WND reported in June 2012 that several hundred pages of documents allege Holder and Lanny Breuer, the assistant attorney general for the DOJ’s criminal division, have intervened to block recommended federal prosecutions in an ongoing dispute involving the Yellowstone Club, a private golf and ski resort now owned by Burkle and international bank Credit Suisse.

WND also reported allegations by Blixseth attorney Mike Flynn that Holder and Breuer sought shield from federal criminal prosecution of Credit Suisse Group AG a client of the Washington-based law firm Covington & Burling, as well as key Democratic Party operatives suspected of playing a role in allegedly fraudulent mortgage financing and bank lending practices.

Before joining the Department of Justice in the Obama administration, Holder and Breuer were partners at the international law firm Covington & Burling.

Judge Markell’s decision last week dismissed a $40 million fraud judgment against Blixseth that had been enforced by U.S. bankruptcy judge Ralph Kirscher, a Democrat appointed to the bankruptcy court by the U.S. Court of Appeals for the Ninth Circuit in 1999 during President Clinton’s second term of office.

Blixseth and Flynn have repeatedly charged that Kirscher’s bankruptcy decision was fraudulently influenced in a 2009 meeting with Montana’s governor at the time, Schweitzer. The meeting resulted in a decision to allow Blixseth’s ex-wife and Sam Byrne, a Boston real estate investor with ties to the Democratic Party, to buy the Yellowstone Club at a price substantially below market value after the bankruptcy had been declared.

Flynn further alleged in a letter shared with WND, addressed to the Public Integrity Section of the U.S. Department of Justice, that Burkle, Byrne and Schweitzer funneled more than $1.2 million through the Democratic Governor’s Association in 2008 to the Montana Democratic Party for the benefit of Schwitzer’s re-election campaign.

Flynn asserts in the letter to the DOJ that the “money laundering scheme – having Burkle and Byrne with their friends donate to the Democratic Governor’s Association and then to the Montana Democratic Party, for the benefit of Schweitzer – appears designed to conceal Burkle and Byrne’s financial relationship with Schweitzer while at the same time Burkle and Byrne were taking over the Yellowstone Club and using their relationship and ‘political capital’ and ‘political favors’ with Schweitzer to do it.”

After his re-election in 2009, Schweitzer created two highly controversial funds, The Council for a Sustainable America and The American Sustainability Project, into which Burkle and Byrne funneled $335,000, Flynn said.

Flynn further charged that in early 2010, the Montana Democratic Party political machine with the backing of Holder and Breuer “targeted” Blixseth with a baseless criminal investigation.

Among recent developments is the entry into the Yellowstone case of a whistleblower who claims to have been paid $6 million by Blixseth’s former wife to hack into Blixseth’s computers to obtain highly confidential information that she shared with Burkle and Department of Justice criminal investigators.

Flynn explained to WND his current concern that Holder may have ordered the Justice Department’s Public Integrity Section to block the whistleblower’s application for immunity to prevent disclosure of corruption by the various Democratic Party political operatives involved in the Yellowstone case, including Holder and Breuer.

Libyan official ties Morsi to Benghazi attack

A letter by a top Libyan official blames the attack that killed U.S. Ambassador Christopher Stevens on Mohamed Morsi, the now deposed president of Egypt.

WND has verified the authenticity of the letter by Col. Mahmoud al-Sharif, the chief of the Department of Security of the Libyan government in Tripoli, written four days after the attack on the U.S. compound in Benghazi.

The letter mentions Morsi as being implicated in the planning that led to the Benghazi attack and identifies the Egyptian jihadist group Ansar Sharia as the group responsible.

The letter discloses that the bodies of three Americans killed in the attack along with Ambassador Stevens were desecrated in revenge for the production of an anti-Islam film, assumed to be “Innocence of the Muslims.” The film was produced by the imprisoned Mark Basseley Yousef, the person the Obama administration erroneously claimed was responsible for triggering for attack itself.

White House press secretary Jay Carney confirmed Wednesday the Obama administration has no change in plans to deliver F-16s to the Egyptian military. The U.S. most likely will deliver four F-16s in August, with another eight slated for December. The deliveries are part of the continuing U.S. $1.5 billion in aid scheduled to be dispersed to Egypt in the current fiscal year, despite the military coup that ousted the Muslim Brotherhood-backed Morsi.

WND was among the first to report that Morsi and his Muslim Brotherhood in Egypt allegedly were involved in the Sept. 11, 2012, Benghazi attack. Videos of the attack posted on YouTube show several jihadists pleading in an Egyptian dialect of Arabic, “Don’t shoot, don’t shoot. Dr. Morsi sent us.”

The Libyan document corroborates an Arabic-language report two days after the attack, discovered by Arabic-speaking former Muslim Brotherhood member Walid Shoebat, and another, Oct. 5, 2012. The  reports presented evidence the radical Islamic broadcaster Al-Nas TV and radical Egyptian Islamic TV preacher Safwat Hijazi were behind the protests in Cairo and the attack in Benghazi.

The Libyan letter states, according to Shoebat’s translation: “The most distinguished names that were obtained from the confessions by members of the cell, is the person, the president of Egypt, Mohamed Morsi; Safwat Hijazi; Saudi businessman Mansour Bin Kadasa, the owner of Al-Nas TV station; Muhammad Hassan, previous candidate Hazim Salah Abu-Ismael; Egyptian attorney Mamdouh Ismael; Egyptian cleric Atef Abdul Rashid; and other personalities.”

Al-Sharif’s Nov. 15, 2012, letter, seen below, was addressed to the Libyan government’s Ministry of Interior in Tripoli.

Shoebat ‘s translation of the letter:

Ministry of Interior

National Security Directorate of Tripoli

Reference Number: 442.67D

Date: September 15, 2012

Report Regarding Egyptian Accomplice Terror Cell That Raided and Burned The American Embassy in the District of Benghazi

His Excellency and dignified Interior Minister, a blessed greetings.

We are honored to bring to his Excellency’s attention regarding the arrest of the Egyptian [terror] cell, which carried out the crime and our investigation up to this date and this hour. That is, after the carrying out of the crime of invading and burning the American general consulate building in the district of Benghazi which happened on Tuesday, September 11, 2012 which resulted in the killing of Mr. Chris Stevens, the American Ambassador in the nation of Libya and Mr. Sean Smith, who finances the Department of Information of the United States Foreign Service including other employees [working] for the embassy. Based on the confessions declared by some who were arrested at the scene of the incident and through our fruitful cooperation with the Department of Security agencies in Benghazi with the information obtained shows that some of the accomplices have escaped the scene of the crime and concentrated themselves in Tripoli. Based on this provided information, an investigative and research group in the agency gained a precise location of the whereabouts this escaped cell was hiding in the vicinity of Khilat Al-Farjan. Immediately after, they were engaged by a special strike force unit, which was able to arrest persons from the cell, all of whom are Egyptian. The initial investigation shows that the membership of the group [belongs] to the jihadist group Ansar Sharia in Egypt which was established and led by Egyptian cleric Marjan Salem. In addition, there were extremely crucial information as to the financial sources of this group and the planners and executers of the operation which carried out the breaking and entering of the American Consulate in Benghazi and killing all occupants including the desecration of their bodies in revenge for the film which was produced by the Crusaders who produced the film that insults the Messenger, Peace and Prayers be upon Him. The most distinguished names that were obtained from the confessions by members of the cell, is the person, the President of Egypt, Muhammad Morsi, Safwat Hijazy and Saudi businessman Mansour Bin Kadasa, the owner of Al-Nas TV station, Muhammad Hassan, previous candidate Hazim Salah Abu-Ismael, Egyptian attorney named Mamdouh Ismael, Egyptian cleric Atef Abdul Rashid, and other personalities. We also promise your Excellency to exert all our efforts to complete all the investigations and place the final report with your Excellency with 48 hours, Lord willing.

We are honored to announce to your Excellency our continual care to work hard with innovation through out blood and soul for the sake of Libya the land of the brave.

[Please] accept the highest greetings

Colonel Mahmoud al-Sharif,

Security Chief – Tripoli

[SEAL] Department of Security

[SEAL] Department of Security, Tripoli

Office of Chief of Security

Issued

Number: 960-13-B

Date: 12-09-15

Signature

Morsi’s ties to genocide in Sudan

Shoebat has documented Morsi’s close relationship with Lt. Gen. Omar Hassan Ahmad Al-Bashir, the president of Sudan.

On Sept. 16, 2012, five days after the Benghazi attack, Bashir flew to Cairo to meet with Morsi at the Presidential Palace in Cairo’s Heliopolis district to congratulate Morsi on being elected Egypt’s president the previous June and to discuss in person bilateral relations, including plans to inaugurate an Egypt-Sudan highway.

On May 4, 2013, at the conclusion of a trip to Sudan, Morsi held a joint press conference with Bashir in the capital, Khartoum, in which the two leaders announced an agreement with Ethiopia over the management of the Eastern Nile Basin that represents approximately 86 percent of the Nile waters.

Shoebat has described Bashir as “a modern Hitler,” an Islamic tyrant responsible for the deaths of over 3 million people, all in the name of jihad against Christians.

Shoebat has additionally discovered that Bashir, working in conjunction with Bashir’s uncle, Eltayeb Mustafa, supported a fatwa in 2011 declaring that it is the duty of every Muslim to persecute Christians. The fatwa provoked a mob of Muslim thugs working for Bashir’s National Party to attack Sudanese Christians on a Kambouni playground Oct. 10, 2011, and to set fire to a Christian church in Khartoum.

Now, more than 10 years after the genocide in Darfur, the International Criminal Court, or ICC, has arrest warrants outstanding for Bashir and other Sudanese officials. The Bashir regime continues to bomb and burn civilian structures in South Kordofan and Blue Nile. The tribal regions, which include many Arabic-speaking Christians, have been the targets of what the ICC characterizes as continuing crimes against humanity.

On Sept. 11, 2012, the day of the attack on the U.S. compound at Benghazi, mobs of Islamic radicals attacked the U.S. Embassy in Cairo.

Shoebat was the first to report Bashir was behind the mobs of Islamic radicals that raided the British, German and American embassies in Khartoum around the same time.

WND has reported that the attacks by Islamic radicals in North Africa on Sept. 11, 2012, including the attacks on Benghazi and on embassies in Cairo and Khartoum, were in response to a video released Sept. 10, 2012, by al-Qaida chief Ayman al-Zawahiri. The video message called on Muslims to retaliate for a U.S. drone strike that killed Libyan al-Qaida leader Abu Yahya al-Libi in Pakistan’s Waziristan tribal area June 4, 2012.

Obama’s brother’s ties to Bashir

Shoebat has also reported that President Obama’s older brother, Malik Obama, is deeply associated with Bashir, despite Bashir’s involvement in the 2011 attack on the U.S. Embassy in Khartoum

Malik is the executive secretary for the Islamic Dawa Organization, or IDO, in Khartoum, which aims to help expand Wahhabist Islam in the African subcontinent, Shoebat noted.

Malik Obama and Bashir attended the General Conference of the Islamic Council of South Sudan and a meeting of the Board of Trustees of the Islamic Dawa Organization at which Bashir said “the enemies of Islam who attempt to impose hegemony and make a siege and to encourage plots (and evil measures) toward Sudan will fail.”

Malik Obama appears to share Bashir’s anti-Christian views. The Dawa organization of which he is executive secretary has stated in writing that “Muslims in Kenya suffer from the great challenge of the tyranny of the church which is known for aggression.”

Shoebat has noted Bashir’s expressed desire to make Sudan’s new constitution “100 percent Islamic,” operating under the rule of Islamic law, or Shariah.

WND has reported that funds contributed in the U.S. to a non-profit foundation run by Malik Obama have been diverted to support Malik’s multiple wives in Kenya.

ACLU uses DOMA ruling to win in federal court

On the heels of the Supreme Court decision striking down key parts of the Defense of Marriage Act, the ACLU scored a win Friday in the organization’s strategy to take the same-sex marriage battle to the states.

In a lawsuit filed by the ACLU, U.S. District Judge David Lawson issued a temporary restraining order ending Michigan’s ban on health benefits for same-sex married employees who work in public schools or for local governments.

The judge relied on the Supreme Court’s DOMA decision Wednesday to conclude that the Michigan state law violates the U.S. Constitution.

Get Jerome Corsi’s “Bad Samaritans: The ACLU’s Relentless Campaign to Erase Faith From the Public Square,” a new and scorching exposé of the group, examining its history, goals, tactics, funding, and the war it daily wages against faith and the legacy of the Founding Fathers.

Lawson ruled that the plaintiffs in the case – same-sex domestic partners working in state universities and various local governments who were forced to purchase more expensive private health insurance because they were denied access to state-provided plans – have a claim under the Equal Protection Clause of the U.S. Constitution.

The injunction by the U.S. District Court in Michigan appears to go beyond U.S. v. Windsor in arguing a state law that denies state benefits to same-sex domestic partners violates the Equal Protection Clause of the Fourteenth Amendment, even in a state where same-sex marriage has been outlawed by the state constitution.

“It is hard to argue with a straight face that the primary purpose – indeed, perhaps the sole purpose – of the statute is other than to deny health benefits to the same-sex partners of public employees. But that can never be a legitimate governmental purpose,” Lawson said as he ordered an injunction, the Associated Press reported.

In granting the preliminary injunction, the judge found the Michigan law discriminated against same-sex domestic partners by forcing cities, counties, school districts and community colleges to cancel health insurance benefits for same-sex couples who are considered married under the Michigan state constitution.

The 5-4 majority of the Supreme Court in DOMA decision stopped short of declaring a federal constitutional right existed to protect same-sex marriage.

In a narrow ruling, the court in U.S. v. Windsor struck down provisions of the 1996 Defense of Marriage Act that barred couples in a same-sex marriage legitimated by a state or foreign government from receiving federal benefits available to those in traditional heterosexual marriages.

The 2011 Michigan law, passed by a Republican-controlled state legislature and signed by Republican Gov. Rick Snyder, curtailed insurance benefits for domestic partners working for certain public employees and local governments. Most employees of institutions of higher learning as well as state government were exempted from the restriction because their benefits were set by the Michigan Civil Service Commission.

In 2004, Michigan passed a constitutional amendment defining marriage only as a union between a man and a woman.

“The judge was absolutely correct in finding that the law was unconstitutional because it’s motivated by bigotry,” Michigan ACLU legal director Michael Steinberg told the Associated Press.

“This law served no purpose to the state of Michigan other than to needlessly discriminate against hard-working families,” said Kary L. Moss, executive director of the ACLU of Michigan. “It’s hard to encourage talented people and their families to work for public employers in Michigan when they’re denied the ability to take care of each other.”

The Michigan ACLU website argued the Michigan Law is “particularly irrational because it allowed municipalities to provide health insurance coverage for other family members – cousins, aunts, nephews – but excluded same-sex domestic partners.”

The victory in Michigan was also celebrated by the ACLU at the national level.

“The court rightly determined that this policy unconstitutionally discriminated against a minority of Michigan families,” said Amanda C. Goad, staff attorney with the ACLU Lesbian Gay Bisexual and Transgender Project. “All hardworking state employees and their families should have the peace of mind of being able to look after each other.”

Anthony D. Romero, the first openly gay executive director of the ACLU, in an editorial published on the website of the national organization, proclaimed the victory in U.S. v. Windsor for ACLU client Edith Windsor was a personal victory for him.

He said “27 years ago, I decided to study law because I wanted to make a difference in the world.”

“And today, the American Civil Liberties Union – the organization that I have been privileged to lead since 2001 – made history by striking down the discriminatory Defense of Marriage Act and winning justice for our client, Edith Windsor,” Romero wrote.

“Edie is one of my favorite clients of all time. She is smart, loving, energetic, passionate, tenacious, and courageous.”

Romero went on to proclaim the Supreme Court’s ruling was “the tipping point in the struggle for full equality for LGBT Americans.”

He also announced the ACLU has hired Republican strategist Steve Schmidt, vice chairman of public affairs at Edelman and the former senior adviser to Sen. John McCain’s presidential campaign, “to spearhead our campaign to strike down state-based laws prohibiting same-sex marriage.”

Additionally, Romero announced, the ACLU has hired Jimmy LaSalvia, founder and former executive director of GOProud, “to help with outreach to gay conservatives, particularly within the Tea Party.”

House panel votes IRS official must testify

In a partisan vote today, the House Oversight and Government Reform Committee set the stage to force IRS official Lois Lerner to testify about the agency’s targeting of conservative groups seeking tax-exempt status.

The committee passed a resolution, 22-17, concluding that in a May 22 appearance before the committee, Lerner waived her Fifth Amendment privilege against self-incrimination by claiming innocence.

The resolution noted Lerner stated: “I have not done anything wrong. I have not broken any laws. I have not violated any IRS rules or regulations, and I have not provided false information to this or any other congressional committee.”

The language of the resolution relied on the legal principle that “a witness may not testify voluntarily about a subject and then invoke the privilege against self-incrimination when questioned about the details.”

At issue is whether Lerner implemented a political agenda by discriminating against groups filing for tax-exempt status that have the words “tea party,” “patriot,” or “9-12” in their titles. The IRS has admitted such groups were given additional scrutiny. Some Republicans suspect the goal was to delay approval of conservative groups through the 2010 and 2012 election cycles while expediting progressive groups.

Today’s vote sets the stage for committee to recall Lerner to force her to answer specific questions about statements she made under oath during her appearance before the committee May 22.

Should Lerner refuse to appear before the committee a second time after being subpoenaed to testify, or should she still refuse to answer questions after being recalled before the committee, she may face contempt of Congress charges.

‘No wrongdoing’ strategy fails

In a hearing Thursday, committee chairman Rep. Darrell Issa, R-Calif., admonished House Democrats for allegedly seeking to derail the investigation into the IRS scandal by asserting progressive groups also were targeted by the IRS for additional scrutiny because of their political ideology.

IRS chief Daniel Werfel began his testimony by asserting an internal IRS investigation had found “no intentional wrongdoing” among IRS employees and that progressive as well as conservative groups were targeted for additional scrutiny upon applying for tax-exempt status.

Werfel’s claim that an IRS internal investigation found no wrongdoing by IRS employees in the handling of applications for tax-exempt status was countered by Rep. Dave Camp, R-Mich., the chairman of the House Ways and Means Committee, who characterized Werfel’s investigation as “incomplete.”

The attempt by Democrats to claim the IRS targeted progressive as well as conservative groups was derailed by a letter to the Treasury inspector general for tax administration, J. Russell George.

George sent a letter to House Ways and Means Committee Ranking Member Sander Levin, D-Mich., correcting the record and strongly rebutting the ranking member’s misleading and inaccurate characterizations of the findings of the TIGTA audit.

Before receiving the TIGTA letter, Levin had released documents that he claimed showed the IRS targeted progressive groups in the same way tea party groups were targeted, signaling the beginning of an Obama administration counterattack in the mounting IRS scandal.

On Friday, Issa directly countered the Democrats strategy by publishing a sharply worded statement on the House Oversight Committee’s website in which he warned the Democrats on the House Ways and Means Committee and on the House Oversight Committee “to stop trying to derail the IRS investigation.”

Issa’s statement pulled no punches.

“Both the Ways and Means and Oversight Committees are methodically working through an investigation following up on the IG audit,” Issa said. “Our Democratic colleagues should stop trying to derail the investigation by defending IRS officials with distorted claims equating the systematic scrutiny of Tea Party groups with the more routine screening progressive groups received.”

Treasury IG Refutes Democratic claims

The report released this week by George concluded that 30 percent of the groups with “progressive” in their title were given extra credit, while 100 percent of groups with “tea party,” “patriot” or “9/12” in their titles were pulled out for strict scrutiny that included what the IRS has since admitted were invasive and inappropriate questions.

“While we have multiple sources of information corroborating the use of Tea Party and other related criteria we described in our report, including employee interviews, e-mails, and other documents, we found no indication in any of these other materials that ‘Progressives’ was a term used to refer cases for scrutiny for political campaign intervention,” the IG wrote.

The controversy has focused on the so-called “Be on the Lookout,” or BOLO lists, that reportedly have been used to target conservative groups for additional and prolonged scrutiny for reasons of political ideology.

George’s letter continued: “Based on information you flagged regarding the existent of a ‘Progressives’ entry on BOLO lists, TIGTA performed additional research which determined that six tax-exempt applications filed between May 2010 and May 2012 having the word ‘progress’ or ‘progressive’ in their names were included in the 298 cases the IRS identified as potential political cases. We also determined that 14 tax-exempt applications filed between May 2010 and May 2012 using the word ‘progress’ or ‘progressive’ in their names were not referred for added scrutiny as potential political cases.”

Republicans call IRS report ‘sham’

Yesterday, Rep. Kevin Brady, R-Texas, hit Werfel with a series of rapid-fire questions.

Brady demanded to know who within the IRS was responsible for initiating a wide range of “ideologically oriented” activities, including the targeting of conservative groups for additional scrutiny on their tax-exempt applications. Brady also wants to know who within the IRS was responsible for targeting the donors of conservative groups and for leaking information to the media regarding conservative groups applying for tax-exempt status.

“I don’t know,” was Werfel’s answer to each question Brady shot at him.

“Your report is a sham,” Brady said pointedly to Werfel, rejecting the IRS chief’s opening statement that his internal investigation had found no wrongdoing among IRS employees.

“You work for the American people and your job is not [to] cover up,” Brady said.

Appearing angered by Werfel’s answers, Brady explained sharply to Werfel that the House Ways and Means Committee intended to get the truth about the BOLO lists and IRS ideological targeting. He warned Werfel that he, too, would also be investigated if he attempted to stonewall or misrepresent facts.