Washington Extra – Will it fly?

March 7, 2011

It wasn’t quite spilling the beans, but White House spokesman Jay Carney did in one sentence clearly list the top three options being considered on Libya: humanitarian aid, enforcing the U.N. arms embargo, and contingency planning for a potential no-fly zone.

Then it got a bit murky. LIBYA-PORTS/

“I just want to stress that the military options that we talk about are not limited to a no-fly zone, but include a no-fly zone as an option,” Carney said.

“It’s a serious option … and it’s not a simple one that you can simply say, ‘Oh, let’s have a no-fly zone, snap your fingers and it happens’.”

Deploying ground troops to Libya was at the bottom of the list. “No option has been removed from the table,” Carney said. But, “ground troops is not sort of top of the list at this point.”

Arming the rebels was an option that the White House was clearly uncomfortable talking about in public.

“I think that it would be premature to send a bunch of weapons to a post office box in eastern Libya,” Carney said. “We need to not get ahead of ourselves in terms of the options we’re pursuing.”

Be sure to look at Lesley Wroughton and Chrystia Freeland’s exclusive interview with IMF First Deputy Managing Director John Lipsky, who warned of emerging markets overheating.

Here are our top stories from Washington…

Obama treads carefully on Libya, rebuffs pressure

The White House pushed back against pressure from some lawmakers for direct intervention in Libya, saying it first wanted to figure out what various military options could achieve. The Obama administration faces sharp criticism, especially from Republican lawmakers and conservative commentators, for its cautious approach to the turmoil in Libya but has signaled it will not be rushed into hasty decisions that could suck the military into a new war and fuel anti-American sentiment.

For more of this story by Ross Colvin and Patricia Zengerle, read here.

White House: oil price a factor for tapping reserves

The White House said the price of oil was one factor — but not the only factor — that would be used when determining whether the United States will tap its strategic oil reserves. “The price of oil is one of a number of factors that is looked at … in making that determination, but not the sole factor,” White House spokesman Jay Carney said. “I wouldn’t look to a price threshold. The issue here is disruption — is there a major disruption in the … flow of oil. That’s obviously a factor.”

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

For a related factbox, click here.

IMF’s Lipsky warns of emerging markets overheating

Fast-growing emerging market economies are beginning to exhibit signs of overheating, a top International Monetary Fund official said. Many emerging markets, including China, have struggled to contain inflation and control the heavy flow of investment money into their economies. Although the IMF has been warning for months of the risks of price pressure, the comments by IMF First Deputy Managing Director John Lipsky suggested the Fund was growing increasingly concerned.

For more of this interview by Lesley Wroughton and Chrystia Freeland, read here.

Gates says killing of Afghan boys a “setback”

Defense Secretary Robert Gates described the mistaken killing of nine Afghan boys by NATO aircraft as a “setback” as the issue overshadowed a visit to Afghanistan to assess security progress. Gates met Afghan President Hamid Karzai on an unannounced trip to Kabul and repeated Washington’s apology for the killing of the boys last week by NATO helicopters, which has increased strain on an already testy relationship with Afghan leaders. “Not only is their loss a tragedy for their families, it is a setback for our relationship with the Afghan people,” Gates said.

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

US to resume Guantanamo trials after 2-year freeze

President Barack Obama lifted a two-year freeze on new military trials at Guantanamo Bay in Cuba and suggested Congress was hurting national security by blocking his attempts to move some trials into U.S. civilian courts. In an apparent acknowledgment that the Guantanamo detention camp won’t be shut down any time soon, Obama also outlined procedures for reviews to be held at least every four years for prisoners held indefinitely without charge or trial.

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

Big Human Genome lupus drug nears market

Human Genome’s lupus drug is poised to win clearance this week, offering patients the first approved treatment option in a half-century and setting the company up for blockbuster sales. Annual global sales may top $3 billion in 2015, according to Thomson Reuters consensus forecasts. The company will split Benlysta profits with British partner GlaxoSmithKline Plc. The drug’s approval will turn Human Genome from money-losing biotech to an industry star and takeover target.

For more of this preview by Lisa Richwine, read here.

Messy U.S. budget, spending prospects

The deeply divided U.S. Congress faces a March 18 deadline to send President Barack Obama legislation to keep the federal government funded and running. Republicans, who hold a strong majority in the House of Representatives, and Democrats, who narrowly control the Senate, are still far apart on spending levels for the rest of this fiscal year, which ends on Sept. 30.

For scenarios by Richard Cowan, read here.

Corn stocks to rise if ethanol tax credit cut-FAPRI Stockpiles of corn would begin to rebuild if Congress allows tax credits for ethanol expire at the end of the year, economists at the University of Missouri said. The ethanol subsidy will be a matter of intense political debate for Congress this year as it looks for ways to cut government spending. “In contrast to past FAPRI-MU baselines, we assume that biofuel tax and tariff provisions will expire on schedule and not be extended,” the group said. “Allowing these policies to expire results in reduced biofuel production and use.”

For more of this story by Roberta Rampton, read here.  For related graphics, click here, here and here.

Senate must act first on debit card fees-Bachus

Republicans in the House of Representatives will not try to stall or change a crackdown on debit card fees unless the Senate supports changing the law, House Financial Services Chairman Spencer Bachus said. The debit card fee provision was added to the Dodd-Frank financial reform law by the Senate, and the Senate must act first and take “ownership” of the issue before the House acts, Bachus told the Institute of International Bankers conference. “We are saying to the Senate: ‘Give us an indication on whether there is going to be action taken’,” he said.

For more of this story by Dave Clarke, read here.

What we are blogging…

Another one heads for the exit: Senator Ensign won’t seek reelection

At this rate, the Senate will be overrun by freshmen in 2013. Republican Senator John Ensign, who had once been considered a potential presidential candidate in 2012, announced that he won’t seek reelection next year. The decision comes nearly two years after he admitted to having an affair with a female staffer whose husband also worked for him. Ensign is the third Senate Republican to announce he won’t seek reelection.

For Tabassum Zakaria’s full post, click here.

From elsewhere…

Trump aide in Iowa to gauge presidential interest

A top aide to celebrity real estate tycoon Donald Trump visited Iowa to gauge interest in the idea of a Trump bid for the Republican presidential nomination in 2012. Michael Cohen, executive vice president and special counsel to Trump’s company, flew aboard one of Trump’s two planes to Des Moines. Trump has flirted with a presidential run, speaking to a conservatives’ conference last month. But many Republicans doubt he is serious.

For more of this story, read here.

China says Dalai Lama has to reincarnate

Tibet’s exiled spiritual leader, the Dalai Lama, does not have a right to choose his successor any way he wants and must follow the historical and religious tradition of reincarnation, a Chinese official said. The 76-year-old Dalai Lama, who lives in India and is revered by many Tibetans, has said that the succession process could break with tradition — either by being hand-picked by him or through democratic elections. But Padma Choling, the Chinese-appointed governor of Tibet, said that the Dalai Lama had no right to abolish the institution of reincarnation, underscoring China’s hardline stance on one of the most sensitive issues for the restless and remote region.

For more of this story, read here.

Photo credit: Reuters/Asmaa Waguih (anti-Gaddafi rebels near Libyan oil facility of Ras Lanuf)

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