Washington Extra – Back pat

February 15, 2011

President Barack Obama wasn’t shy about praising his handling of the revolution in Egypt.

USA-BUDGET/“I think history will end up recording that at every juncture in the situation in Egypt that we were on the right side of history,” Obama said at a news conference.

“What we didn’t do was pretend that we could dictate the outcome in Egypt, because we can’t,” he said. So if the United States didn’t dictate the outcome, what did it do?

According to Obama it was about being “very mindful” that Egyptians should drive any changes, but also sending a message that the United States believed in an “orderly transition.”

“I started talking about reform two weeks or two-and-a-half weeks before Mr. Mubarak ultimately stepped down. And at each juncture I think we calibrated it just about right,” Obama said.

And again: the peaceful transition and relative absence of anti-American sentiment showed “that in a complicated situation, we got it about right,” he said.

The Egyptian military promises to hand power to an elected government in six months — an eternity when you consider it took 18 days of protests to oust a president of 30 years.

And how is Mubarak? Rumors ran rampant about his health, and sources told Reuters he was “breathing,” unwell, and “fine.”

Here are our top stories from Washington today…

Obama warns spending cuts could hurt U.S. recovery

President Obama warned Republicans against making “symbolic cuts” in spending that could damage the fragile U.S. economic recovery. Republicans in Congress have lambasted the 2012 budget Obama announced on Monday and have presented him with an immediate challenge. They plan to pass legislation in the House of Representatives by week’s end to cut this year’s spending by at least 14 percent to show how serious they are about reducing the deficit. “I think it is important to make sure that we don’t try to make a series of symbolic cuts this year that could endanger the recovery,” Obama said.

For more of this story by Jeff Mason and Richard Cowan, read here.

Obama slams Iran government, praises Egypt army

President Obama condemned the Iranian government’s crackdown on opposition protesters, drawing a sharp contrast with the Egyptian military’s more restrained response to Egypt’s popular uprising. “I find it ironic that you’ve got the Iranian regime pretending to celebrate what happened in Egypt, when in fact they have acted in direct contrast to what happened in Egypt by gunning down and beating people who were trying to express themselves peacefully,” Obama said at a White House news conference.

For more of this story by Matt Spetalnick and Patricia Zengerle, read here.

Geithner- reform Social Security but keep benefits

Treasury Secretary Timothy Geithner said the United States needs to shore up its massive pension program without slashing Social Security benefits or subjecting them to the “whims” of the stock market. He warned Republicans against cutting spending too quickly, calling for gradual deficit reduction to avoid endangering the economic recovery.

For more of this story by Rachelle Younglai and David Lawder, read here.

China faces Internet ‘dictator’s dilemma’-Clinton

China, Syria and others face a “dictator’s dilemma” over Internet control and risk being left behind as the rest of the world embraces new technologies, Secretary of State Hillary Clinton said. In her second major speech on Internet policy, she said the recent Internet-fueled toppling of rulers in Egypt and Tunisia and protests in Iran, showed governments could not long pick and choose which freedoms to grant their citizens. “We believe that governments who have erected barriers to Internet freedom — whether they’re technical filters or censorship regimes or attacks on those who exercise their rights to expression and assembly online — will eventually find themselves boxed in,” Clinton said in a speech.

For more of this story by Andrew Quinn, read here.

New US envoy wades into Afghanistan, Pakistan tangle

The Obama administration’s new Afghanistan and Pakistan envoy will face a daunting task in a region where the United States is battling a bloody insurgency in one country and struggling to hold together a battered alliance in another. Secretary of State Hillary Clinton is expected to announce later this week her choice of retired diplomat Marc Grossman as replacement for Richard Holbrooke, who died.

For more of this analysis by Missy Ryan, read here.

Carmakers push back on U.S. efficiency aims

Car companies are resurgent financially and attracting support from powerful Republicans in Congress, placing them on firmer ground to challenge moves toward even stricter fuel-efficiency standards. Two years ago, struggling automakers, some receiving billions of dollars in taxpayer aid, agreed with the Obama administration to raise average fuel efficiency 40 percent to 35.5 miles per gallon by 2016, the largest jump ever. But they are drawing the line at more aggressive mandates, making it their top lobbying priority in Washington as they emerge from a four-year slump that devastated U.S. production.

For more of this analysis by John Crawley, read here.

CFTC says swaps rules binge won’t cause hangover

A top financial regulator rejected fears that new derivatives rules will hurt businesses trying to hedge their costs, saying the price of a six-pack of beer won’t skyrocket because of the reforms. “We’re aware and focused on the cost of a six pack because we also oversee agricultural markets,” CFTC Chairman Gary Gensler, a marathon runner who does not drink alcohol, told the House Financial Services Committee. “I would say our intention is not to have margin requirements applied to an end user such as MillerCoors”.

For more of this story by Christopher Doering and Sarah N. Lynch, read here.

FTC staff opposes Grifols buy of Talecris

U.S. antitrust regulators may challenge Spanish healthcare firm Grifols’ planned buy of Talecris Biotheraputics on fears that the merger would reduce supplies and raise prices for plasma-derived medicines to treat a range of autoimmune disorders. The staff of the U.S. FTC is recommending that the agency challenge the $4 billion deal, said a source knowledgeable about the review. “The staff view is that it’s a compelling merger that needs to be challenged. Obviously the commissioners need to weigh in,” said the source.

For more of this exclusive story by Diane Bartz, read here.

Lawmakers target big bank dividend increases

Seven Democratic lawmakers have expressed concern that big banks, some of which are still benefiting from government financial support, plan to boost their dividends and reduce capital. “It seems hard to justify reducing the capital of banks without considering the continued government support that banks with outstanding guarantees enjoy,” the lawmakers said in a letter to Federal Reserve Chairman Ben Bernanke.

For more of this story by Kevin Drawbaugh and Joe Rauch, read here.

Retail sales slow, still point to growth pickup

Growth in sales at retailers slowed in January, partly due to harsh winter weather, but the trend remained supportive of an acceleration in growth. Total retail sales rose 0.3 percent for a seventh straight month of advances, the Commerce Department said, but were below the 0.5 percent increase posted in December. “Consumers seem to have got 2011 off to a slow start but we can chalk up a lot of that to the weather. The bulk of those lost sales will now be made up in February,” said Ryan Sweet, a senior economist at Moody’s Analytics.

For more of this story by Lucia Mutikani, read here.

Food prices at dangerous levels, Zoellick warns

World Bank chief Robert Zoellick said global food prices have reached “dangerous levels,” and warned that their impact could complicate fragile political and social conditions in the Middle East and Central Asia. World Bank data released on Tuesday showed higher food prices — mainly for wheat, maize, sugars and edible oils – have pushed 44 million more people in developing countries into extreme poverty since June 2010.

For more of this story by Lesley Wroughton, read here.

What we are blogging…

Why are these politicians smiling?

Social Security reform is coming. You can tell by the smiling nice guy personas being adopted around Washington in uncommon bipartisan fashion. There’s Alabama Senator Jeff Sessions, the senior Republican on the Budget Committee. “If we’re smart, we can adjust those programs in ways that minimize the impact,” he reassures the viewers of MSNBC’s “Morning Joe.” After all, Sessions says there’s no reason seniors should have to worry about losing their Social Security (who says they would?) or see it “savaged in any significant way.”

For David Morgan’s full post, click here.

From elsewhere…

German zoo prepares cross-eyed cat for celebrity

Hot on the heels of cross-eyed opossum Heidi’s smash success at the Leipzig Zoo, a nearby animal park in eastern Germany has been preparing its own cross-eyed creature for possible celebrity. Fourteen-year-old wild cat Frank’s handlers believe he was born cross-eyed, unlike Heidi, whose crossed eyes stem from a poor diet. The opossum became a star in Germany when her photo appeared in the mass-circulation newspaper Bild in December, generating a Facebook following topping 300,000 fans. She has also been recruited by Hollywood to predict winners of the Academy Awards on U.S. television.

For more of this story, read here.

Photo credit: Reuters/Larry Downing (Obama at news conference)

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