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Analysis, background reports and updates from the PBS NewsHour putting today's news in context.

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    HARI SREENIVASAN: A wave of bombings across Iraq killed at least 15 people today. Dozens more were wounded. The deadliest incident took place east of Fallujah. A suicide bomber targeted anti-al-Qaida Sunni fighters as they were being paid. Six people died there. The attacks continued a surge of sectarian violence that erupted in late April.

    In economic news, the Federal Reserve warned there's evidence that budget cuts and the resumption of higher Social Security taxes are restraining growth. It said it will continue its stimulus measures for now. The Fed statement helped drag Wall Street lower. The Dow Jones industrial average lost nearly 139 points to close below 14,701. The Nasdaq fell 29 points to close at 3,299.

    April was a good month for car and truck sales, the best in six years, in fact. Ford's U.S. sales rose 18 percent, while both Chrysler and General Motors saw an 11 percent increase. A rebound in pickup truck sales led the way for the Detroit automakers, partly due to rising demand from home builders and other businesses.

    President Obama today nominated a new overseer for two mortgage lending giants and a new chief regulator of the telecommunications industry. North Carolina Democratic Congressman Melvin Watt was the choice to lead the Federal Housing Finance Agency, which governs mortgage giants Fannie Mae and Freddie Mac. Tom Wheeler, a former cable and wireless industry lobbyist, was selected to head the Federal Communications Commission.

    The president announced the nominations at a White House ceremony with both men by his side.

    PRESIDENT BARACK OBAMA: Mel has led efforts to rein in unscrupulous mortgage lenders. He has helped protect consumers from the kind of reckless risk-taking that led to the financial crisis in the first place, and he has fought to give more Americans in low-income neighborhoods access to affordable housing.

    For more than 30 years, Tom has been at the forefront of some of the very dramatic changes that we have seen in the way we communicate and how we live our lives. He was one of the leaders of a company that helped create thousands of good high-tech jobs.

    HARI SREENIVASAN: The two nominations are subject to Senate confirmation.

    Thirty-two mentally disabled men in Iowa won a jury award of $240 million dollars today from a defunct Texas firm. Starting in the 1970s, the men worked at a turkey processing plant. Investigators testified they were held in virtual enslavement. They were housed in a rundown, rat-infested bunkhouse and paid just $65 dollars a month. The conditions were discovered in a 2009 inspection.

    A veteran congressman and a former Navy SEAL will face each other in the race for a U.S. Senate seat in Massachusetts. Rep. Ed Markey won the Democratic nomination in yesterday's primary, and Gabriel Gomez won a three-way Republican primary. They are vying for the Senate seat vacated by John Kerry when he became secretary of state. The election will be held eight weeks from now, on June 25th.

    Those are some of the day's major stories -- now back to Judy.

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    JUDY WOODRUFF: And we turn to a growing pushback against economic austerity measures here and in Europe. The day started with several big protests abroad, as citizens complained their governments are cutting spending too severely.

    European capitals filled with May Day crowds protesting austerity measures that are meant to bring down sky-high government debt. In Athens, Greek union workers went on strike against proposed layoffs of public employees.

    KOSTAS TSIKRIKAS, President, Confederation of Civil Servants Trade Union: We will continue to fight to overturn this unfair and dead-end policy that is destroying millions of jobs on a national and European level and is driving large swathes of society to poverty and destruction.

    JUDY WOODRUFF: In Madrid, Spaniards joined the protests. Unemployment in Spain and Greece now tops 27 percent. And for the Eurozone as a whole, it hit a record high 12.1 percent in March. The human toll behind the data also fueled rallies today in Britain, Portugal and France, with trade unions and others insisting that spending cuts and tax hikes have killed economic growth.

    THIERRYLEPAON, Secretary General, CGT Workers Union: We have seen that in Spain, in Greece, in Portugal, in Italy, the austerity policies launched by these governments are leading once again to a dead end.

    JUDY WOODRUFF: The arguments over austerity and debt are echoed in Washington's debates over budget cuts. A 2010 Harvard study by economists Kenneth Rogoff and Carmen Reinhart concluded that when government debt exceeds 90 percent of the gross domestic product, the economy shrinks a 10th of a percent. It's frequently cited by Republicans, including House Budget Committee Chair Paul Ryan and Utah Sen. Orrin Hatch.

    SEN. ORRIN HATCH, R-Utah: And while one might quibble with the particulars of Reinhart's and Rogoff's assessment, failure to take it seriously, given the recent struggles of the Eurozone, amounts to whistling past the graveyard.

    JUDY WOODRUFF: But, this month, researchers at the University of Massachusetts did more than quibble. They concluded that average annual growth actually tops two percent even when government debt is high. And they charged the Rogoff-Reinhart study included key calculation errors and omitted important post-World War II data from other countries, such as Australia and New Zealand.

    The furor became fodder for comedian Stephen Colbert.

    STEPHEN COLBERT, "The Colbert Report": Please.

    If ignoring New Zealand, Australia, and Canada were a crime, everyone in America would be on death row.

    But, come on, 2.2 percent up, 0.1 percent down. You say potato, I say eliminate food stamps.

    JUDY WOODRUFF: Reinhart and Rogoff have acknowledged some errors, but they say their conclusions are sound just the same. Other economists say mandatory budget cuts, known as the sequester, are at least partly to blame for the disappointing March jobs report. President Obama said as much yesterday.

    PRESIDENT BARACK OBAMA: It's slowed our growth. It's resulting in people being thrown out of work, and it's hurting folks all across the country.

    JUDY WOODRUFF: Another picture of the sequester's effects on growth may come Friday, when April's unemployment numbers are released. 

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    JUDY WOODRUFF: As we mentioned earlier, the Federal Reserve today was critical of current fiscal policy in Washington. In a statement issued after their regular meeting, Fed governors wrote cuts in government spending are -- quote -- "restraining economic growth."

    We look at the renewed debate surrounding spending and austerity now. Robert Kuttner is a founder and co-editor of The American Prospect magazine. He's the author of a new book, "Debtors' Prison: The Politics of Austerity vs. Possibility." And Kevin Hassett, an economist who has written papers on this subject. He served in Republican administrations and is now the director of economic policy studies at the American Enterprise Institute.

    Welcome to you both.

    And, Robert Kuttner, to you first. Let's start with the United States. What are some examples of policy right now in this country that you believe are hurting economic growth?

    ROBERT KUTTNER, The American Prospect: Well, we had the New Year's deal that President Obama made with the Republicans that was supposed to head off the so-called fiscal cliff.

    That took about $200 billion dollars out of economy. We raised Social Security taxes two points. We raised taxes on the top one percent, and then to compound the damage, we have the sequester, which was executed in March.

    So, those two things together, according to the Congressional Budget Office, which is a bipartisan outfit, cut the growth rate by -- in half this year from a projected three percent to a projected 1.5 percent. If you are in a depressed economy and you reduce purchasing power further, you are only going to make the economy more depressed, and far from getting closer to an improvement in debt ratio, you are going to reduce the GDP relative to what it would have been and so the debt ratio is going to get worse.

    So, we have had a real-time experiment both in the United States and in Europe in the failure of austerity policies to dig the economies out of the hole they are in.

    JUDY WOODRUFF: Kevin Hassett, do you accept his examples as a sign that growth has been cut and this is how?

    KEVIN HASSETT, American Enterprise Institute: Sure. Yes.

    Absolutely, Robert's numbers are very precise and accurate. I mean, the 1.5 percent is the CBO estimate. I did my own back of the envelope on the car over, and it was about the same. But the fact is, I think that we need to step back and think about what is going on in Europe and all the unrest and put it in a slightly longer-term perspective to understand where we are and what policy decisions we have to make.

    The fact is that before the crisis the government spending to GDP in the typical industrialized country all in counting state and local was about 39 percent. Because of expansionary Keynesian policies, but also built-in stabilizers like having to pay more unemployment insurance for folks and so on, it jumped up to about 44.5 percent.

    JUDY WOODRUFF: You are saying there's a lot of spending going on?

    KEVIN HASSETT: Yes. But it's still way above where it was before the crisis.

    So, in the average industrialized country, it's gone from about 44.5 to 42.5, which is still above where it was before the crisis, and so there have been reductions. They have reduced growth relative to the peak. But at some point, you kind of run out of money if you keep spending -- deficit spending up around nine, 10 percent.

    And so the governments have had to ratchet back because they had pursued Keynesian policies. And now they're coming back and we're in the hangover period.

    JUDY WOODRUFF: Now, you are folding Europe into this conversation. I was trying to keep them separate. But maybe that's not possible.


    JUDY WOODRUFF: Robert Kuttner, what about that, the fact -- his point is pretty clear that the spending was just practically out of control before, and, yes, there have been some cutbacks, but not very much?

    ROBERT KUTTNER: You know, it really wasn't out of control.

    The biggest single source of the increased deficit was the recession. And let's not forget what caused the recession. It wasn't government spending being out of control. It was a financial collapse made on Wall Street. And if you have a financial collapse, the government collects less revenue and spends a little bit more on things like unemployment compensation and food stamps, and so the deficit goes up.

    But it doesn't logically follow that you can get a recovery going by cutting the deficit, because the only thing that is keeping the economy afloat, given the weakness of wages and salaries and private demand and private investment, what is keeping the economy afloat is deficit spending, public spending.

    And so the time to get the deficit under control is when the economy is booming. It's not when the economy is in a ditch. And that's why these policies don't work.

    JUDY WOODRUFF: What about that? And that is part of what the Federal Reserve said today.


    Well, the problem is that a Keynesian policy is well-designed if you can do it right.

    JUDY WOODRUFF: And Keynesian plan meaning ...

    KEVIN HASSETT: Which means spending, trying to drive up government spending in order to drive growth -- is perfect if you look at the historic recession that lasted about 11 months and then we grew about 6.5 percent the year after.

    If we could take some of the government spending from the 6.5 percent year, move it into the year where we have a recession, then of course it's a good idea if you can do it. The problem is that we're in a protracted period of slow growth. And we're trying to build a kind of Keynesian bridge, a government spending bridge to when we're growing stronger.

    But the evidence -- the other Reinhart and Rogoff evidence from a different study is that it usually takes about a decade to recover from a financial crisis. And so spending our way out of that is a really, really hard thing to do. And governments haven't been able to sustain it and that's why pretty much across the industrialized world, everybody has been cutting back on spending and increasing taxes to try to get ahead of the curve on deficits.

    JUDY WOODRUFF: What about that point? Robert Kuttner, you are shaking your head.

    ROBERT KUTTNER: Well, it takes a decade to get out a crisis or it takes a year or two depending on what government does.

    What Europe has demonstrated is, if you put the whole economy in a debtor's prison, it is going to take twice as long, three times as long. The reason I call it a debtor's prison is that if you put somebody in a debtor's prison, you ruin their ability to earn a living and they can't help themselves, they can't help their creditors.

    There's a terrible double standard in debt. We have done some work on this at Demos, where I'm a senior fellow. A corporation can get out from under debt by declaring Chapter 11. But a student debt carries that student to his or her grave. If the parent co-signs the student loan and the student dies, the parent is still responsible.

    We have a trillion dollars of student debt. What a thing, what a gift to give the next generation. Mortgage holders can't declare Chapter 11, but corporations can. So, there are huge double standards here. And Europe just demonstrates that you can't deflate your way to recovery.

    The way to get the debt ratio down is to get a recovery going. World War II is history's great example. We went from 12 percent unemployment to zero percent in the course of six months because government spent serious money. And then we grew out way out of that. So, I think the whole view that let's tighten our belts and the economy will recover is just being refuted day by day.

    JUDY WOODRUFF: You not only argue, Kevin Hassett, that belts should be tightened. You argue for much deeper cuts in entitlement programs like Social Security, Medicare in this country and the equivalent programs in Europe.

    KEVIN HASSETT: That's right.

    The economist's language for it is a fiscal consolidation. And there have been many studies of fiscal consolidations that suggest that a country has a better long-term growth prospects if it gets ahead of the curve on debt. But you need to do it in a measured way. You don't want to front-load all the pain right now.

    And I would actually agree with Robert. If you look at European nations, for example, they have had a heck of a lot of contraction, of contractionary fiscal policy. And Robert was good to mention the tax increases here in the U.S. They have had tax increases like that in Europe throughout Europe and spending cuts. And they have front-loaded them. So, they really have cast Europe into a recession with this austerity in some pockets.

    But don't forget the reason they are doing it is that nobody really wanted to lend to Greece because their deficits were so large, their policies were so unsustainable that the country looked like it might go bankrupt.

    JUDY WOODRUFF: Let's end by asking you both what you think needs to be done right now in the United States if you could wave a magic wand and have Congress do it.

    Robert Kuttner?

    ROBERT KUTTNER: Well, I don't think you should have the kind of grand bargain that President Obama is talking about with the Republicans, where you cut Social Security, you cut Medicare, and in exchange the Republicans agree to raise taxes and you have 10 more years of austerity.

    I think, in the next year or two, until the economy gets back on its feet, you need public spending to put people back to work, rebuild the infrastructure that would make the economy more competitive. And then, when you get back to something close to full employment, people have jobs, people are paying taxes, then you can start reducing the debt because you have a higher growth rate, and the debt starts coming down, the debt ratio, that is, of its own accord. That's the time to rebalance.

    JUDY WOODRUFF: And would that be your remedy?

    KEVIN HASSETT: I think the thing that should be the headline for listeners is not necessarily what I want, but what has already happened.

    If you look at the CBO's analysis of what President Obama and the Republicans have already agreed to, then they have stabilized the debt at a pretty reasonable level, about the average of the last 20 years, relatively quickly. And my guess is, given that, there's going to be a lot of posturing in Washington, but in the end, they are probably not going to do much more either way. There won't be more tax increases. There won't be more big spending cuts.

    It might be different from what I would want, but I think listeners should know that despite all the rhetoric, they have made a lot of progress already.

    JUDY WOODRUFF: Well, the debate -- and it is a debate -- goes on.

    Kevin Hassett, Robert Kuttner, thank you both.

    ROBERT KUTTNER: Thank you.

    KEVIN HASSETT: Thank you. 

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    GWEN IFILL: The deaths of more than 400 factory workers in Bangladesh hung over May Day protests in Asia today.

    Ray Suarez reports.

    RAY SUAREZ: Demands for higher pay and better working conditions brought out thousands of low-wage workers across Southeast Asia. They marched in Indonesia, Cambodia, the Philippines, and elsewhere.

    ATH THORN, Coalition of Cambodian Apparel Workers Democratic Union: For wages, we call on the new government to increase pay for all garment workers and for civil servants, police and military personnel.

    ELMER LABOG, Chair, May First Movement: The change in the rotten system prevailing in society is really in the hands of the workers and ordinary people.

    RAY SUAREZ: This year, the annual May Day rallies were fueled by outrage over the deadly collapse of an eight-story building in Bangladesh. The illegally built structure housed several garment factories that employed thousands of workers. The death toll has now passed 400, but it remains unclear how many are still missing.

    Today, Bangladeshis filled the streets in the capital, Dhaka, carrying the memories of those lost in last week's tragedy.

    MOSHREFA MISHU, Labor Leader: The workers who were killed in the building collapse, we protest and we demand that the owner of the building be hanged and compensation should be given to the injured and those who died. A healthy and safe atmosphere should be made in the factories.

    RAY SUAREZ: Officials also began burying dozens of victims who could not be identified.

    Hundreds attended the mass funeral and burial, many covering their noses to combat the smell of the decomposing bodies. More mass burials are expected in the coming days. At the building site, heavy machinery has been brought in to remove the many tons of rubble that remain. Officials have given up on finding any more survivors. The focus now is on recovering the dead.

    Meanwhile, the building owner is in custody. He left a court yesterday wearing a police helmet and bulletproof vest, following his second appearance in as many days. He's one of eight people arrested thus far.

    For more on working conditions in the developing world, I'm joined by Pietra Rivoli, an expert on the globalization of clothing manufacturing and a professor of finance and international business at Georgetown's McDonough School of Business. And David Von Drehle is a journalist for TIME magazine. He wrote "Triangle: The Fire That Changed America," a book about this country's response to its own factory disaster.

    Professor Rivoli as we saw, there were marches throughout South Asia. Is this work generally badly paid and dangerous?

    PIETRA RIVOLI, Georgetown University: Well, I don't think we can make a general conclusion about that.

    There are good factories. There are good conditions. There are safe factories. And we have experience, though, at the other end of spectrum as well. And, of course, what happened last week was an example of conditions at the very bottom.

    RAY SUAREZ: What has changed about the rules governing global trade? How did Bangladesh end up the home of the garment industry's -- it's the second largest garment industry in the world.

    PIETRA RIVOLI: That's right.

    In 2005, we did away with a system of apparel trade regulation in the United States that very tightly managed apparel imports into the country. And so we didn't have a free market at that time. Instead, different countries were allowed to sell different quantities of clothing to the United States.

    When those regulations were lifted, we went to a pure market system. Most of the production flowed to China. However, during in the past couple of years, wage rates in the apparel industry in China have shot up. They have doubled and in some areas even tripled. And so the production has moved to lower-cost areas such as Bangladesh.

    So what happened really is, you have a tremendously rapid flow of production from one country to another. And certainly the infrastructure, the safety infrastructure, the construction infrastructure, the codes of conduct and so forth, they are scrambling to keep up.

    RAY SUAREZ: David Von Drehle, we're just a little century away from the Triangle Shirtwaist factory fire; 146 people, mostly young women, died in one afternoon.

    Is there a rough parallel between places like Bangladesh and Cambodia and Malaysia today with what was going on in Lower Manhattan in 1911?

    DAVID VON DREHLE, TIME: Absolutely, Ray.

    Your other guest made a very good point and used terrific language when she talked about a runaway industry, with the government regulators sort of trying to catch up to them. That's exactly what happened in the United States at the turn of the century, when the ready-to-wear garment industry, made-to-measure garment industry took off like a lightning bolt.

    And suddenly we had factories all throughout New York, Philadelphia, Chicago that were churning out millions of dollars worth of clothing. And the governments were not prepared to deal with these new realities. And you had not just the Triangle fire, the most famous, but these kinds of factory disasters frequently happening.

    And what I found as I studied the Triangle fire, which was a catalyst for change, is that the real driver is not sympathy or outrage at these terrible tragedies, which are definitely tragic, but the rising power of the workers, more education for workers, more power especially for women in the workplace.

    And as they make -- and more enfranchisement, opportunity to vote. These are the factors that drive out corruption and bring on in its place a respect for the lives of the human beings who do the work.

    RAY SUAREZ: Well, Professor, given what David Von Drehle just described, these are young democracies where we saw these marches going on today. Could this be a similar galvanizing moment?

    PIETRA RIVOLI: You know, I think that the Shirtwaist fire was certainly a tipping point in the U.S. industrial history. And there are tipping points all across the world in industrial history.

    And I think it's quite possible that this event last week will serve as a tipping point. But there are enormous challenges in the political infrastructure of Bangladesh. If you look at why that building was ever even built the way it was, you know, the root causes have to do with corruption at the local level, with systems of graft.

    You have just kind of mob bosses in charge at the local political level. So there's a tremendous amount of cleaning up of the political infrastructure that needs to happen before people's political voices can be effective.

    RAY SUAREZ: David, is there also a risk here for the workers if things are tightened up, if there are better conditions in the factories, if wages are raised? Is there a chance that you are taking that international producers will head to even lower-cost places, if you can find them left on planet Earth?

    DAVID VON DREHLE: This is the great paradox of more developed economies trying to influence this process, because the reason that there were so many workers in that factory laboring under such appalling conditions is that there's desperate poverty in Bangladesh.

    And they are actually working their way up into those jobs, if you can believe it. Same was true in the United States 100 years ago. Those workers in the Triangle factory were there because it was a good job compared to the alternatives.

    So, what we have to find in the United States and other developed countries is ways to pressure our retailers, our manufacturers, our brands to engage, perhaps, with these issues of corruption that the professor talked about, which is so important. We who live under the rule of law tend to take it for granted. It is a huge engine for our safety, our protection, our economic freedom.

    And that's what we need to be exporting to these countries, along with low-wage jobs.

    RAY SUAREZ: David Von Drehle, Professor Rivoli, thank you both.

    DAVID VON DREHLE: Thank you.

    PIETRA RIVOLI: Thank you very much. 

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    JUDY WOODRUFF: In Northern California, there's an unusual battle brewing over a renowned oyster farm that's located in a national seashore. The fight is playing out among business, government and some environmentalists. But it's one that's creating strange bedfellows concerned about the outcome.

    Spencer Michels reports.

    SPENCER MICHELS: The Drakes Bay Oyster Company at Point Reyes National Seashore north of San Francisco may be producing its last crop.

    When its long-term lease expired last year, the Department of the Interior said the lease was terminated, and ordered the family-owned company to stop planting and harvesting oysters, as the farm has done since the 1930s. And that has provoked a battle with an unlikely cast of characters.

    The repercussions extend far beyond this spectacular Pacific Coast enclave, to the restaurants of the Bay Area and all the way to Washington, D.C., where politicians of both parties are joining in the fight. Much of the area in the National Seashore has been designated wilderness, and the then secretary of the interior has said the oyster farm doesn't fit in a wilderness area, since it's a commercial operation.

    So he ordered it closed in March. The company sued to stop its eviction, and a federal court has allowed operations to continue while it considers the case.

    KEVIN LUNNY, Drakes Bay Oyster Company: This lease has an explicit renewal clause. It was always anticipated that it could be renewed by special use permit. It says it right in the original document.

    SPENCER MICHELS: Kevin Lunny is the principal player, a longtime rancher, one of the owners of the Drakes Bay Oyster Company. Its 30 employees plant and harvest six to eight million oysters a year from the waters of Drakes Estero, an inlet from the ocean. He bought the oyster operation seven years ago, knowing that his lease would expire in 2012. But he tried to change that.

    KEVIN LUNNY: This is exactly what was planned for the seashore. And the oyster farm is part of the working landscape. It's part of the agriculture. It's really part of the fabric, part of the history, part of the culture that was always expected to be preserved.

    SPENCER MICHELS: Local and national environmental groups have joined the fray. They say a lease is a lease and that a larger principle is involved.

    Amy Trainer is heads one organization.

    AMY TRAINER, Environmental Action Committee: Under the 1964 Wilderness Act, commercial operations and motorboats are not allowed. They're expressly prohibited. So this operation is wholly incompatible with this national park wilderness area.

    This is a very dangerous precedent. Drakes Estero is considered the ecological heart of the Point Reyes National Seashore, and it absolutely should be protected for future generations without commercial uses.

    SPENCER MICHELS: In fact, all the players agree. Point Reyes is a unique and gorgeous land of tule elk, hiking trails, elephant and harbor seals, wildflowers, grass-covered hills, and a few cattle ranches that predate the Seashore and remain in place under the law.

    This sparsely populated area became part of the national park system in 1962, and today two-and-a-half million people visit a year. What appeared to be primarily a local dispute has become a conservative cause 3,000 miles away in Washington.

    Critics see government as trampling on economic freedom. A national advocacy group called Cause of Action, a government watchdog, has taken on Lunny's case.

    Dan Epstein, an attorney who once worked for a foundation run by one of the conservative activist Koch brothers, is the group's executive director.

    DAN EPSTEIN, Cause of Action: What we're doing with cases like the Drakes Bay Oyster Company is to educate the public that when you have a federal government that in some cases is unchecked, it can lead to certain harms to economic freedom.

    SPENCER MICHELS: Epstein says the Secretary of the Interior's decision to close the operation should be reviewed by the courts.

    DAN EPSTEIN: If agencies are able to effectively shut down a business, just in the discretion of their policy authority, without following certain legal procedures and the Constitution, that's going to have an impact upon small business owners and individuals in terms of their economic rights.

    TOM STRICKLAND, Former Department of the Interior Official: I think this situation has been hijacked by interest groups with different agendas, who have spun out narratives that have no relationship to the facts.

    SPENCER MICHELS: Another Washington attorney, former Assistant Secretary of the Interior Tom Strickland, has joined the battle. He says shutting down the oyster farm will clear the way for establishing an underwater marine wilderness area at Point Reyes, and he defends former Secretary Ken Salazar's actions.

    TOM STRICKLAND: He determined that the people of the United States had in fact bought and paid for that oyster farm, had given the then owner a 40-year term. When that term expired, then that land and that right was to return to the people. And then that area will become our first marine wilderness area in the Lower 48.

    SPENCER MICHELS: The controversy has split the environmental community and made strange bedfellows.

    California Democratic Sen. Dianne Feinstein asked that Lunny's lease be extended 10 years, claiming the Park Service acted unfairly and with bias. A group of restaurant owners and sustainable food advocates, including Alice Waters of Chez Panisse, are supporting Lunny and his oysters; 85-year-old environmental activist Phyllis Faber is now fighting against the Interior Department and its allies.

    PHYLLIS FABER, Environmental Activist: They yearn for wilderness, but do you know there hasn't been wilderness in this park area, in the Point Reyes Seashore area for probably 200 years? So I look at them as being sort of backward-looking, yearning for something that can't possibly exist. It's almost like a religion.

    SPENCER MICHELS: Yet, she's not happy to be on the same side as Cause of Action.

    PHYLLIS FABER: I am very disturbed by that, and I don't agree with it at all. I think what they're headed for is trying to use a commercial operation in a park. They want to establish that in other public -- on other public lands. And I think that's terribly unfortunate.

    SPENCER MICHELS: All of this controversy has overwhelmed the little Marin County town of Point Reyes Station, where Lunny and his oysters are popular.

    The controversy is so intense that many residents wouldn't comment, for fear of alienating their neighbors. But a few did risk it.

    DORIS OBER, Point Reyes Station: I don't care for oysters personally to eat, but I think the oyster farm is a wonderful thing for our area.

    CATHY DAVIS, Point Reyes Station: They're very good for the environment. They create a lot of jobs. They're wonderful people. And it's sustainable.

    SUSAN PRINCE, Point Reyes Station: The precedent will be that it will be OK then to go into other parks, and we will have less and less wilderness.

    SPENCER MICHELS: The battle intensified recently, when Republican Sen. David Vitter of Louisiana included a provision to extend to oyster farm's lease for at least 10 years in a bill primarily designed to expedite the Keystone XL pipeline and oil and gas development in Alaska.

    In Marin County, the Environmental Action Committee is leading the charge to get rid of the oyster operation.

    AMY TRAINER: You can see all these outflow tubes. They just had a cease and desist order placed on them by the California Coastal Commission.

    SPENCER MICHELS: Amy Trainer, the committee's executive director, is working with Neal Desai of the National Parks Conservation Association to convince the courts and the public that the oyster farm doesn't belong in a wilderness area. They say Drakes Bay oyster Company has despoiled the estuary.

    AMY TRAINER: They grow non-native species. They grow invasive species. They have dumped thousands of pieces of plastic into our marine waters, which can potentially harm seabirds and marine mammals. It's polluted our National Seashore beaches. You see the invasive species called marine vomit growing all over their oysters. You see their motorboats zooming by.

    SPENCER MICHELS: Lunny and his defenders say the operation has not hurt the environment. Both sides quote studies supporting their points of view.

    KEVIN LUNNY: It's been studied by the National Academy of Sciences; they have found no serious effect at all; we are not losing marine debris; we're actually cleaning it up.

    SPENCER MICHELS: In fact, the National Academy of Sciences complained there wasn't enough data to determine whether the oyster operation was harming the waterway. But that's only part of the issue, says former interior official Strickland.

    TOM STRICKLAND: I think the question now is, who's looking out for the American taxpayer? And who gets to profit from a favorable lease arrangement with the United States? One family? What's the particular equities in that?

    SPENCER MICHELS: A hearing in federal appeals court on whether Drakes Bay Oysters should close is scheduled for mid-May. 

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    GWEN IFILL: Today marks the second anniversary of the raid that killed Osama bin Laden. Tonight, we bring you the previously unknown story of the sisterhood of CIA analysts who chased the al-Qaida leader.

    Margaret Warner reports.

    MARGARET WARNER: It was the news most Americans had waited nearly a decade to hear.

    PRESIDENT BARACK OBAMA: After a firefight, they killed Osama bin Laden and took custody of his body.

    MARGARET WARNER: But for many of the people who'd helped find Osama bin Laden, their work had started nearly two decades earlier, long before the most-wanted man on earth had earned his infamy.

    Their story of the CIA analysts and officers who'd tracked down the al-Qaida chief is told in the documentary HBO film "Manhunt" debuting tonight. It's based on the book by CNN's Peter Bergen.

    PETER BERGEN, CNN: In '97, Osama bin Laden had declared war on the United States, but no one paid any attention.

    CINDY STORER, Former CIA Analyst: There were just warning after warning. We knew something huge was going to happen.

    MARGARET WARNER: But long before that September day, their chase began in a near-total information vacuum.

    WOMAN: Well, we certainly didn't know that al-Qaida existed. We didn't know there was a terrorist organization.

    MARGARET WARNER: The group tracking the elusive Saudi militant was known as Alec Station and was novel in its approach.

    MAN: The unique thing about Alec Station was the fusion of analysis and operations.

    MARGARET WARNER: The analytical team at CIA was comprised mostly of women. Before 9/11, it wasn't a prime assignment. Cindy Storer was an analyst, part of what was called “The Sisterhood.”

    CINDY STORER: I was counseled once in a performance review that I was spending too much time working on bin Laden. They said we were obsessed crusaders, overly emotional, using all those women stereotypes.

    MARGARET WARNER: Nada Bakos followed Storer on the mostly female team.

    NADA BAKOS, Former CIA Analyst: We picked up that end of the spear, where some of the operations officers tend to be mostly men.

    MARGARET WARNER: After 9/11, the tempo of operations shifted to hunting al-Qaida figures in Afghanistan, Iraq and elsewhere. Many analysts moved into new jobs as “targeters.” Nada Bakos was among them, forward-deployed in Iraq to track Abu Musab al Zarqawi.

    She also targeted a vital al-Qaida emissary who, after capture, gave up the name of the courier who eventually led the U.S. to bin Laden's door two years ago today. 

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    MARGARET WARNER: Joining me now to discuss the hunt for bin Laden and al-Qaida, I'm joined by two members of so called sisterhood of CIA analysts who appear in the film "Manhunt" and whose work was so crucial to the U.S. effort, Cindy Storer and Nada Bakos.

    And welcome to you both.

    Like most CIA analysts, you have worked in secret. Your identities have been kept secret all these years. Why did you decide to speak so openly through this film?


    NADA BAKOS: I just wanted to be able to tell the firsthand account story for essentially a lot of people that are still there, in addition to my former colleagues.

    I thought this was a good opportunity to be able to give the viewer a sense of what national security is like and how the CIA works.

    MARGARET WARNER: Cindy, what about you?

    CINDY STORER: My motivations were very similar.

    And I -- on a personal level, I really hoped this would help people understand what our colleagues are doing, and they wouldn't just be sort of faceless colleagues in the bureaucracy that you can put blame on for whatever goes wrong.

    MARGARET WARNER: This was -- at least informally, your unit within the bin Laden or al-Qaida hunting unit was known as “The Sisterhood.” Do you think there's something different about women analysts?

    CINDY STORER: Yes, it's funny, because I honestly don't know.

    I have gone through so many theories with so many different people. For me, personally, in those years, I never thought of myself as a woman, except when we were lumped together that way by other people who were trying to criticize the program.

    Other than that, I was just another analyst doing what needed to be done, I thought anyway.

    MARGARET WARNER: And, Cindy, what was the hardest thing? Let's go back to the '90s. When you were trying to piece together that puzzle that was al-Qaida, the organization, what was the biggest challenge in recognizing and identifying that what looked like separate attacks around the world from the East Africa bombings to the Cole were in fact the work of this one organization and its name was al-Qaida and Osama bin Laden was the head of it?

    CINDY STORER: There's the technical difficulties, if will you, of just trying to figure out -- going through all these mounds of little bits of information, and trying to make it -- see if there's a picture there.

    And to do that, you have to have a model -- you have to have several models in your head about how organizations look like, how they work, how they might not work. What could it be besides a certain kind of organization? And then you are constantly testing the information you get against all these various ideas you have in your head. And then it turns out to be something that you recognize or something that you don't.

    MARGARET WARNER: And, Nada, how was the work that this unit did viewed, let's stay before 9/11, within the agency?

    NADA BAKOS: You know, I -- when I joined in 2000, I wasn't in the Counterterrorism Center, but my understanding -- and, Cindy, you weigh in on this -- is that, you know, counterterrorism work wasn't initially viewed as important as some of the traditional analytical work.

    CINDY STORER: I mean, most analysts in the agency are -- it's kind of -- it's scholarly, really. It's a combination between scholarship and journalism, a lot of the job is.

    And doing counterterrorism or doing really any transnational issue is a little bit different, not that you are not achieving those levels of scholarship on the issues, but you are also digging down into all of these little details that most people don't have to worry about.

    If you are working a state -- a country, you already know the wiring diagram, how the state is organized, even if you have to figure out who really has the power. Well, with a group like this, we had to figure out they even existed. And doing that kind of detailed worked was looked down upon.

    MARGARET WARNER: And then, in 2001, your unit and the CIA in general was warning the administration, the rest of the government, that something big was coming, yet 9/11 happened.

    When that happened, did you blame yourselves, or were you angry at the criticism that it was due to an intelligence failure?

    CINDY STORER: Well, you can't help but feel guilty and blame yourself, even if there really is nothing you could have -- more you could have done.

    It's just human nature. And then, yes, it was very difficult to deal with everyone blaming you for something that you tried so hard to prevent.

    MARGARET WARNER: Nada, what would you add to that?

    NADA BAKOS: For -- in large part, everybody at the CIA takes their job incredibly seriously. That sense of responsibility is not lost on the people who do that job.

    So, to have to point out that there was maybe some issues leading up to 9/11 or points missed, I mean, certainly, the people doing the work understood exactly what had happened.

    MARGARET WARNER: After 9/11, the unit and -- expanded, but really shifted to focusing on targeting individuals for kill or capture. How big a shift was that?

    NADA BAKOS: You know, from my perspective, it was pretty dramatic.

    I mean, I went from a traditional analytical role and then moved over to the operations side. And, even informally, there were obviously some people already doing that targeting work.

    MARGARET WARNER: When targeting, you are targeting someone to be captured and interrogated or killed. What kind of a moral dilemma did that pose for you? You talk about it in the film a little.

    NADA BAKOS: I do.

    When you -- you are evaluating the problem, if it's determined that this person or individual is doing something that is harming the United States' national security interest or doing something within the country that -- and in this case, it was a war theater inside of Iraq -- it's -- I think the onus is upon us to be able to control that situation. And if the only way to do that is to capture or kill an individual, then I think it's warranted.

    MARGARET WARNER: After decades working on this, bin Laden is dead, a lot of al-Qaida senior leadership is dead. How confident are each of you that the United States is going to be able to manage this ongoing threat in the decades to come?


    CINDY STORER: That's a hard question, because, obviously, you know, as we go into the future decades, we're not going to be just looking at this threat. There will be something new coming down the line. It's probably going to look different.

    And, as we always do, we focus on the current, the current war, which we have to do. And I'm always concerned that we're not going to listen to the next people who are standing and jumping up and down with their hair on fire trying to get people's attention to something totally new and different.

    MARGARET WARNER: Nada Bakos and Cindy Storer, thank you so much.

    NADA BAKOS: Thank you.

    CINDY STORER: You're welcome.

    GWEN IFILL: Online, Margaret compares "Manhunt" with some of the other recent retellings of the hunt for bin Laden. You can find that on our World page. 

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    Photo of U.S. capitol by Larisa Epatko/PBS NewsHour.

    The Morning Line

    The burgeoning debate over immigration reform is expected to consume lawmakers on Capitol Hill in the coming months. But for the moment, at least, the issue does not appear to have grabbed the attention of much of the American public.

    According to a poll released Wednesday by the Pew Research Center, just 19 percent of respondents said they are closely following developments.

    If that is the case, much of the public has not formed an opinion yet about the legislation introduced last month by a bipartisan group of eight senators that would increase funding for border security enhancements and provide a pathway to citizenship for millions of undocumented people currently in the country.

    The Pew survey found that 38 percent of Americans said they don't know what they think about the bill. Among those who had reached a conclusion, 33 percent said they favor the measure compared with 28 percent who said they oppose it.

    The poll's findings present an opportunity for supporters and opponents of the legislation, with so much of the public seemingly up for grabs. Swaying those undecideds will likely be key in ramping up pressure on lawmakers when it comes time to act on the legislation.

    Most Americans also are unaware of key provisions included in the package. About four-in-10 (37 percent) knew that the legislation was authored by a bipartisan group of lawmakers, while less than half (46 percent) of respondents knew the measure allowed undocumented people to remain in the country while applying for legal status.

    Democrats, by a two-to-one margin, support the bill, while Republicans are more evenly split on the overhaul.

    The Washington Post's David Nakamura reports Thursday that the president is urging liberal supporters to back the bipartisan proposal in the Senate despite reservations some might have that the bill does not go far enough.

    The efforts underscore the perilous path ahead for a comprehensive immigration deal, which is one of Obama's top agenda items for his second term but faces mounting criticism from those on both the left and right.

    In a private meeting with a dozen Latino leaders at the White House this week, Obama emphasized that securing a large margin in the Senate is crucial to putting pressure on House Speaker John A. Boehner, R-Ohio, to accept the general framework of the legislation.

    The president made clear that he expected the people in the room to support the Senate proposal even if they had doubts about some details, participants said. Once an overarching plan was locked in place by Congress, Obama told the group, the administration would be able to revisit some of their concerns and figure out ways to improve it.

    Even if the president is able to keep his liberal allies on board with the Senate plan it still might not be able to overcome objections in the Republican-controlled House. Sen. Marco Rubio, R-Fla., one of the members of the Gang of Eight, said Tuesday that the legislation as it's currently written would have to be adjusted.

    "The bill that's in place right now probably can't pass the House," Rubio said.

    The Pew poll comes as President Barack Obama prepares to head south for a quick trip to Mexico and Costa Rica, with immigration reform at the top of his agenda.

    The Associated Press' Jim Kuhnhenn previews the visit, noting that White House officials say Mexico's economy is a critical element of a successful immigration reform measure:

    "With Mexico, first and foremost, they are critical to our ability to secure the border," said Ben Rhodes, an Obama deputy national security adviser. "All the immigration plans that have been contemplated put a focus on securing the border as an essential priority and starting point for immigration reform."

    Even better than a strong border is an economy that keeps people from fleeing. "If the Mexican economy is growing, it forestalls the need for people to migrate to the United States to find work," Rhodes added.

    Eager to focus on the economy and immigration, the administration is downplaying Pena Nieto's recent steps to end the broad access Mexico gave U.S. security agencies to help fight drug trafficking and organized crime under his predecessor, Felipe Calderon. Still, the changes are likely to be a subject during the two leaders' private talks. Obama said this week he wouldn't judge the new moves until he heard directly from Mexican officials.

    Thursday Mr. Obama will meet with Mexican President Peña Nieto and Friday he huddles with Costa Rican President Laura Chinchilla. Mr. Obama will speak at the Central America Forum on Sustainable Economic Development Saturday.

    The NewsHour will examine the bigger picture of the visit Thursday. Watch here.


    Mr. Obama Thursday will officially nominate Chicago businesswoman Penny Pritzker to lead the Department of Commerce at a morning Rose Garden ceremony. The Hyatt hotel board member was one of his most prolific fundraisers. He also will name economic adviser Mike Froman to be the next U.S. Trade Representative.

    The Obama administration appealed a federal court's decision to allow the morning-after pill for girls of any age.

    A new CBS News/New York Times poll found 59 percent of Americans unhappy with the Senate's failure to pass an amendment expanding background checks for gun purchases.

    The president's appointment of Rep. Mel Watt, D-N.C. to lead a housing agency, will open up a crowded race in North Carolina's 12th Congressional district. You have to see how gerrymandered this district is to believe it.

    Bloomberg reporter (and birthday girl) Julianna Goldman writes that the first sequester-related furloughs are kicking in among White House staffers.

    The Hill's Jonathan Easley on a clash between the Republican National Committee and Democratic National Committee "over a new RNC ad that the DNC says cruelly exploits the Newtown shootings."

    Politico's Jake Sherman gets Republicans to talk about an "unprecedented level of frustration" within the House GOP Conference.

    Sen. Ted Cruz, R-Texas, used his Facebook page Tuesday to respond to a National Review story that he is considering a 2016 presidential bid. Cruz referred to such talk as "wild speculation," but did not deny the report.

    Stu Rothenberg warns against writing off the Massachusetts Senate race.

    Mother Jones crafted this handy state-by-state guide to sequestration cuts.

    Rep. Steve King, R-Iowa, said Tuesday he's "embarrassed" that he hasn't made a decision yet about running for the Hawkeye State's Senate seat in 2014, according to Kathie Obradovich of the Des Moines Register.

    In Virginia's gubernatorial race, former Democratic National Committee chairman Terry McAuliffe's first TV ad will begin airing Thursday. The biographical spot echoes the softer tone Attorney General Ken Cuccinelli deployed in his first ad last week.

    Buzzfeed digs up the juiciest tidbits from McAuliffe's 2007 book.

    Rhode Island Independent Gov. Lincoln Chafee is preparing to sign the Marriage Equality Act Thursday, writing in the New York Times, "marriage equality is an issue where doing the right thing and the smart thing are one and the same."

    Larry Flynt endorsed former South Carolina Gov. Mark Sanford ahead of Tuesday's 1st Congressional district race.

    Los Angeles mayoral candidate Wendy Greuel has launched an attack against rival Eric Garcetti for receiving the endorsement of Republican Kevin James, who was eliminated in the March primary. In response, James released text messages sent to him by Greuel that show the Democrat actively sought his backing.

    Three Los Angeles council members want the city to formally oppose any attempt by billionaire conservative activists Charles and David Koch to buy Tribune company newspapers, including the L.A. Times. A large group of the paper's staffers said they'd quit, too, if the deal happened.

    Add the National Archives and Records Administration to the list of places hit by sequestration.

    James Ponsoldt will direct Rodham.

    Vogue Magazine empress Anna Wintour seems to be back on the shortlist for U.S. Ambassador to Paris, says the Washington Post.

    The Washington Times profiles the National Rifle Association's next president, Alabama attorney Jim Porter.

    The Washington Post puts the gruesome details up top: Members of the early 17th century Jamestown colony resorted to cannibalism.

    The site MuckRock is seeking volunteers to help combat potential open records difficulties because of a Supreme Court decision on Virginia's Freedom of Information Act. The court's ruling allows the commonwealth -- and others -- to fill only in-state residents' requests for documents.

    All the HRC .gifs you'll ever need, courtesy Dorsey Shaw.

    Rafalca Romney won a dressage competition in California.


    In Judy's Notebook, Judy Woodruff writes that Mr. Obama is not the first president to be accused of sour relations with Congress, but the strong localized loyalties fueled by increasingly gerrymandered congressional districts leave little political incentive for House Republicans to cooperate with him.

    Simone Pathe examines the respective business ties plaguing Cuccinelli and McAuliffe in the Virginia governor's race.

    Drawing on his recent trip to Pakistan, Dan Sagalyn reports on how perceptions of danger hamper Pakistani textile businesses.

    Previewing the HBO film "Manhunt," about the CIA "sisterhood" behind the search for Osama bin Laden, Margaret Warner spoke with Cindy Storer and Nada Bakos, CIA analysts who appear in the film. Margaret writes more about Storer and Bakos here, contrasting the spotlight shone on their "unsexy work" with Hollywood's "Zero Dark Thirty."


    Some great dope from @hotlinereid on CO Dems trying to move to vote-by-mail and WhatItMeans ... m.tmi.me/U1ZAk

    — jmartpolitico (@jmartpolitico) May 2, 2013

    How's this structurally different than what Data Trust was supposed to do in '12? RT @seanspicer: new RNC data share washingtonpost.com/blogs/post-pol...

    — The Victory Lab (@victorylab) May 2, 2013

    It's Wednesday. Need a hug? twitter.com/BarackObama/st...

    — Barack Obama (@BarackObama) May 1, 2013

    Delicious lunch at @billysroanoke- I recommend the fish tacos twitter.com/timkaine/statu...

    — Senator Tim Kaine (@timkaine) May 1, 2013

    Covered May Day in LA three years ago and got sunburned. At today's May Day march in Denver, lost feeling in my fingers.

    — Alexandra Tilsley (@atilsley) May 1, 2013

    Former CIA Director Petraeus accepts teaching job at USC j.mp/ZXA5tp

    — The Hill (@thehill) May 2, 2013

    Katelyn Polantz and politics desk assistant Simone Pathe contributed to this report.

    For more political coverage, visit our politics page.

    Sign up here to receive the Morning Line in your inbox every morning.

    Questions or comments? Email Christina Bellantoni at cbellantoni-at-newshour-dot-org.

    Follow the politics team on Twitter:

    Follow @cbellantoni

    Follow @burlijiFollow @kpolantzFollow @elizsummersFollow @tiffanymullonFollow @meenaganesan

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    Screen grab of Mexican flag

    President Barack Obama and his Mexican counterpart Enrique Pena Nieto may have hoped that drugs and violence would not grab most of the headlines of their Thursday summit in Mexico City. But events may be conspiring against them.

    Especially for the new Mexican leader, the agenda for the meeting was to focus on economics and his reform programs that resemble a combination of Franklin D. Roosevelt and Theodore Roosevelt big ideas rolled into one. And President Obama was more than ready to go along, highlighting an expanding economic relationship with the rapidly growing southern neighbor now reaching half a trillion dollars in annual trade alone.

    "The president of Mexico is trying to change the narrative from security to economic reform," said Michael Shifter, president of the Inter-American Dialogue who just returned from the capital.

    "The mood in Mexico is upbeat. There is a lot of optimism," Shifter said.

    Indeed, Pena Nieto's reform plans have been almost as much the talk of Washington as they are in Mexico City. From education to banking to energy, he is pushing programs through the Mexican congress that could dramatically change the country. And drawing even more notice in the U.S. capital is that the leader of the PRI party has won bipartisan support for his agenda in the Pact for Mexico that he put together with the PAN party opposition even before he took office in December.

    But Pena Nieto's security agenda has been much more of a mystery, beyond campaign promises to reduce the violence in a five-year drug war that's left 60,000 dead and to create a federal police force on the model of European gendarmeries.

    Though it is too early in Pena Nieto's term to determine if a new approach can reduce long-term drug violence, Mexico is still the scene of enough grisly gang murders to show the problems have not gone away. At least 300 deaths were reported in March, including one lurid incident in a southwestern town in which seven bodies were placed in chairs around the town plaza with notes attached to their shirts.

    And helping push the security agenda higher was a front-page story in Sunday's Washington Post detailing the intense drug war cooperation between Washington and several Mexican agencies during the administration of President Felipe Calderon. That story also substantiated reports that top officials in the Pena Nieto government had been non-commital when asked by Washington if that kind of cooperation would continue.

    A more substantial answer came on Monday, when the Mexican government announced that all future cooperation on drug and security issues would be funneled through one Mexican agency, ending the ad hoc arrangements that allowed U.S. civilian and military agencies to develop close working relationships with Mexican officials.

    And while the Obama administration asserted its trust in its Mexican counterparts, the developments aroused long-standing Washington fears that the more nationalistic PRI government would reduce cooperation with the Americans as it fashioned a new security policy aimed less at killing kingpins and going after drug caches.

    But even without the hot button drug issue, Mr. Obama's visit coincides with a decisive time on another pivotal issue -- immigration. Mexican leaders have expressed growing frustration as Congress failed over the last decade to adopt immigration reform that would open a path to citizenship to millions of undocumented Mexicans in the United States. A bipartisan immigration bill is likely to reach the Senate floor for opening debate during the president's trip to Mexico and then to Costa Rica for a Central American summit.

    At his Tuesday news conference, Mr. Obama insisted the focus of the trip would be on economics.

    "We've spent so much time on security issues between the United States and Mexico that sometimes I think we forget this is a massive trading partner responsible for huge amounts of commerce and huge numbers of jobs on both sides of the border. We want to see how we can deepen that, how we can improve that and maintain that economic dialogue over a long period of time."

    On the drug war, President Obama said he would wait until he talked directly with Pena Nieto before passing judgment on any new Mexican approach.

    But there is one indication that economics may eventually trump immigration, according to former U.S. immigration commissioner Doris Meissner. For the past two years, she said, there has been no new net outflow of immigrants from Mexico to the U.S.

    Among the reasons, she said, a lower Mexican birthrate, a higher high school graduation rate and an economy that is creating an expanding Mexican middle class.

    Michael D. Mosettig, PBS NewsHour foreign affairs and defense editor emeritus, watches wonks push policy in Washington's multitude of think tanks. From time to time, he writes dispatches on what those scholars and wannabe secretaries of state have in mind for Europe, Asia and Latin America.

    Follow @NewsHourWorld

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    The Obama administration wanted Republican states to accept the health law's Medicaid expansion pretty much as is. Republicans wanted Medicaid money in no-strings block grants.

    Arkansas has broached what could be a deal-making compromise, giving Washington the increased coverage for the poor it wants and Republicans something that looks less like government and more like business.

    Florida, Nebraska and other Republican-heavy states have taken a look. Some think the Arkansas model, passed by a Republican legislature and signed by Democratic Gov. Mike Beebe last week, could erode resistance in some 30 red states and eventually prompt similar programs elsewhere. And because the federal government has put no deadlines on Medicaid expansion, other states will be able to watch what happens in Arkansas and see if they want to adopt a similar idea.

    While the plan brings what many see as advantages for patients, it also raises difficult questions of cost and implementation. KHN reporter Jay Hancock talked to experts to learn the implications for consumers and taxpayers.

    Q: What's the Medicaid expansion and what is the Arkansas plan?

    A: Expanding the Medicaid program accounted for more than half of the 30 million or so uninsured people who were supposed gain coverage through the Affordable Care Act. The Supreme Court's decision making Medicaid expansion optional, combined with red-state reluctance, have reduced chances of reaching the coverage targets.

    Arkansas would let newly eligible Medicaid beneficiaries shop for insurance policies along with other consumers in the online marketplaces, also known as exchanges, created by the health law. Arkansas House Speaker Davy Carter, a Republican, called the idea "a conservative alternative to the policy forced upon us by the federal government."

    Q: How is the Arkansas proposal different from traditional Medicaid?

    A: Medicaid is a combined federal and state program for low-income and disabled people that for many years paid health care providers for each procedure as well as each doctor and hospital visit. Recently most Medicaid treatment has shifted to managed-care plans run by private insurance companies with incentives to keep costs down. Arkansas takes the privatization idea a step further by letting many Medicaid consumers shop for the same commercial insurance available to those who aren't eligible for the program.

    "The menu of options is going to look the same" for eligible Medicaid consumers as for anybody else buying through the online marketplaces, said Matt Salo, executive director of the National Association of Medicaid Directors. "Access to physicians is going to look the same."

    Q: What are the advantages?

    A: Commercial insurers' doctor networks are generally wider than Medicaid networks. Entrée for Medicaid patients could improve access to care and prevent minor illnesses from spiraling into expensive hospitalizations.

    It could also reduce care disruptions for those whose incomes fluctuate, shifting them between Medicaid and the subsidized exchanges.

    At the same time, adding thousands of Medicaid members to the exchanges could reduce the risk that a few chronically ill patients would sharply drive up exchange premiums. With proper software, exchanges could determine people's eligibility for Medicaid and pay federal and state Medicaid dollars directly to their insurance plans.

    Q: Will the Arkansas model automatically be implemented?

    A: No. The Department of Health and Human Services has said it will consider "a limited number" of Arkansas-style plans in which Medicaid beneficiaries would use federal dollars to buy private policies. Arkansas must give HHS a detailed proposal. A federal green light is no sure thing, given the plan's departure from traditional practice and a requirement that it be cost effective. "We haven't approved anything," Marilyn Tavenner, acting administrator of HHS's Centers for Medicare and Medicaid Services, said at a confirmation hearing in April.

    Q: What are the disadvantages?

    A: Cost might be a big one. Medicaid typically pays hospitals and doctors much less than average. A beneficiary costing the government $6,000 a year for Medicaid would cost $9,000 on a private plan on the exchange, the Congressional Budget Office has estimated. On the other hand, Arkansas officials have suggested that competition among insurers and providers for Medicaid patients could keep the cost from being prohibitive or even save money eventually.

    There would also be challenges to harmonizing Medicaid plan designs with those of policies sold on the exchanges. Private coverage on the exchanges is expected to come with large deductibles and co-payments for consumers, but Medicaid strictly limits such cost sharing.

    For a Medicaid patient, "if you're going to go to the pharmacy counter and pick up your prescription, are you going to have to come up with this 15 or 20 percent copay out of your pocket?" said MaryBeth Musumeci, a senior analyst at the Kaiser Family Foundation's Commission on Medicaid and the Uninsured. (Kaiser Health News is an editorially independent program of the foundation.)

    Q: Would all Arkansas Medicaid members be able to shop on the exchanges?

    A: No. The law would keep most of Arkansas' existing Medicaid beneficiaries -- mainly children -- in the state's regular Medicaid program. To avoid potential cost shocks to the exchanges, the very sickest of patients in the Medicaid expansion would also be placed in traditional Medicaid.

    Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente.

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    Then Democratic presidential candidate, Bill Clinton, talks to members of the audience after the second presidential debate in Richmond, Va., in October 1992. According to the Center for Public Integrity, the Clinton/Gore '96 Primary Committee still owes $100,080. Photo by Ron Sachs/Consolidated News Pictures/Getty Images.

    After the most expensive presidential race in history it may not come as a surprise that many of the campaigns from 2012 remain with unsettled debt. What may come as a surprise is that debt remains on the books for campaigns going as far back as 1984.

    The Center for Public Integrity senior writer Dave Levinthal examined these campaigns in a story published Thursday.

    "Presidential candidates incessantly talk about budgets, small businesses and fiscal responsibility during their campaigns. But many of them, in the heat of political battle, break their own banks -- and leave numerous businesses holding the bag, sometimes for years," Levinthal said.

    Now that campaign season is over, Levinthal wanted to identify the biggest deadbeat candidates and have them explain their plans for paying back what their campaigns still owe.

    Read an excerpt from the story below:

    Former House Speaker Newt Gingrich dubbed the national debt a "burden for our children for life."

    Ex-Rep. Dennis Kucinich vilified Republicans for adding, by his calculations, $4 trillion to it.

    Rep. Michele Bachmann, meanwhile, predicted debt will precipitate a future of "indentured servitude to foreign lenders."

    What unites these and other presidential candidates is that they themselves are in debt. Campaign debt.

    It's a dubious distinction shared by Democrats and Republicans, eccentric nonagenarians and White House occupants.

    Such debt isn't really hurting anyone but creditors -- certainly not the nation nor its creditworthiness.

    But it is a reminder that despite candidates' soaring rhetoric about fiscal responsibility, they often fail to follow their own prescription for sound budgetary management amid the relentless rush to remain competitive with political rivals during election seasons that are longer and more expensive than ever.

    Until the debts are paid, the federal government requires former candidates in most cases to keep their campaign committees open and, technically, active, meaning some of the indebtedness stretches back decades.

    Following are the nation's top presidential campaign deadbeats who still find themselves at least $100,000 in the red, according to a Center for Public Integrity analysis of disclosures filed with the Federal Election Commission:

    Read the entire story and see the list of candidates and their debts at the Center for Public Integrity's website.

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    Former Secretary of State Hillary Clinton. Photo by Reuters/ Gary Cameron.

    The timing couldn't have been any better.

    The progressive women's group EMILY's List unveiled its 'Madam President' campaign Thursday to elect the first female President of the United States in 2016, the same morning a new poll found former Secretary of State Hillary Clinton to be the overwhelming favorite for the Democratic Party's nomination in three years.

    And Clinton's name was clearly on the minds of many in attendance at the National Press Club, including EMILY's List president Stephanie Schriock.

    "I have to say, there is one name that seems to be getting mentioned more than others," Schriock said. "We do not know if Hillary is going to run, but we are hopeful that she may."

    If Clinton decides to pass on a second bid for the White House, Schriock said Democrats are blessed with "a deep bench" of potential women candidates, naming examples such as Health and Human Services Secretary Kathleen Sebelius, former Washington Gov. Christine Gregoire and New York Sen. Kirsten Gillibrand.

    The 'Madam President' campaign includes a six-figure digital advertising buy to target women voters online as well as outreach events in the critical primary states of Iowa, Nevada and New Hampshire.

    EMILY's List also released a poll of likely voters in nine battleground states (Colorado, Florida, Iowa, Nevada, New Hampshire, North Carolina, Ohio, Virginia and Wisconsin) that found 86 percent of them believe the country is ready to elect a woman president and 72 percent say it will likely happen in 2016.

    "It's like they were saying, 'duh,'" pollster Lisa Grove of Anzalone Liszt Grove Research remarked.

    Grove's colleague, Jeffrey Liszt, also noted that a woman candidate has the potential to spark greater interest in the election. Nearly half (49 percent) of voters said they would be more likely to follow the campaign if there was a woman in the race.

    How much of that is driven by the prospect of a Clinton candidacy remains to be seen.

    From her perspective, Schriock says the same enthusiasm for a woman candidate would still apply, even if Clinton was not part of the equation. Voters are "looking for a skill set" and not a specific candidate, according to Schriock.

    Clinton received the support of 65 percent of respondents in a Quinnipiac University survey released Thursday that put her up against Vice President Joe Biden, New York Gov. Andrew Cuomo, Massachusetts Gov. Deval Patrick, Virginia Sen. Mark Warner and Maryland Gov. Martin O'Malley in a hypothetical Democratic primary.

    Schriock challenged polling organizations to test other women candidates besides Clinton in future surveys. "Because this is a wide open race if Secretary Clinton doesn't decide to do this," Schriock said.

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    By Paul Solman

     A pressman inspects the roll out of $20 bills When the Federal Reserve buys up Treasury bonds to keep interest rates low, is this risky? Paul Solman answers a reader's question on the potential consequences and explains why this Federal Reserve practice -- known as "quantitative easing" -- may not achieve its goal of lowering long-term or short-term rates. Photo by Paul J. Richards/AFP/GettyImages.

    Paul Solman answers questions from the NewsHour audience on business and economic news here on his Making Sense page. Here is Thursday's query.

    Ross Snow, San Francisco, Calif.: What are the longer-term consequences of the Fed's policy of buying up Treasury bonds to keep interest rates low? Is there a big risk concerning that in our future?

    Paul Solman:All policies entail some risk. Or, to put it another way, the only law absolutely protected from repeal is the law of unintended consequences.

    On the other hand, there's no way to avoid risk - in life or in economics. Economics is, at its core, the discipline of decision -- making that rigorously weighs future costs against future benefits. But because ours is a probabilistic world, all projections of the future, no matter how rigorous, entail uncertainty - and thus risk. To slightly paraphrase Mick Jagger, you won't always get what you want.

    So, to your question: what happens when one arm of the government -- the Federal Reserve -- creates money (electronically) and then lends it to another arm of the government -- the U.S. Treasury -- to keep interest rates low and thereby stimulate the economy? Shouldn't the creation of money stimulate inflation as well? Isn't that a steep cost? Is this risky?

    Well first, there are two classes of interest rates: short-term and long-term. The Fed can manipulate short-term rates. But long-term rates? Not so clear.

    Therefore, when someone asks if the Fed is running a "big risk" by keeping interest rates low, the question is: which interest rates, short-term or long-term?

    A big risk of bargain basement short-term interest rates is that they encourage speculation. Vehement on this subject is David Stockman, a veteran of Congress, the Reagan Administration and Wall Street, who thinks the Fed's low short-term interest rate policy is not just risky, but -- well -- here's how he put it in an interview I did with him this week that will air on PBS NewsHour soon:

    "It's crazy; it's lunacy. You can't have [rock bottom short-term interest rates] for seven years. You know what that does? It is simply a bonanza for speculators who can borrow the overnight money and then buy something that they can speculate on.

    You're creating a system of bubble finance where interest rates are so low that people can speculate that an asset value will go up. So you put it up as collateral, you borrow against the collateral, you take the money and you buy more of the asset. You then take the rising asset, you borrow against it again ...This is what's going on in the world."

    Meanwhile, Stockman and others say non-speculators who put their money in short-term investments like a bank deposit or money market account are punished with no return at all.

    But most investments are made for longer terms such as a mortgage to buy a house, a 10- or 30-year Treasury bond, a student loan, a municipal bond to build a bridge or school, A corporate loan to build a factory or a car loan, even.

    These are all long-term loans, subject to long-term interest rates. What's the risk of Fed intervention here? To be blunt, would the Fed be able to keep them low even if it keeps lending the U.S. government money in massive amounts?

    The way it does this lending is by creating electronic money and using it to purchase long-term Treasury bonds -- so-called "quantitative easing." "Quantitative" because it's creating such a quantity of new money; "easing" because the purpose is to bring down long-term interest rates and thereby "ease" the ability to borrow money for long-term investments, especially by businesses, who would then hire more people, who would then spend more, etc.

    The crucial and usually unreported point is: Long-term interest rates have seemed almost impervious to the Fed and what it's been doing.

    Consider this curious fact: When the Fed first announced its first round of "quantitative easing" back in December of 2008, it bought mortgage-backed securities and bonds issued by the quasi-governmental housing agencies, Fannie Mae and Freddie Mac.

    The idea was to bring down mortgage rates from their then-current rate of 6 percent (for a 30-year fixed rate loan). If the housing lenders could borrow money more cheaply because lenders like the Fed would provide it, they could pass on lower interest rates to home buyers.

    In March of 2010, the Fed finally ended the program. Mortgage rates had indeed come down a bit -- down to 5 percent. So perhaps that was an indication that the Fed's plan had in part succeeded. But the Fed was about to stop buying, presumably figuring the housing market was about to return to normalcy. The risk: that mortgage rates would go up.

    "When the Fed stops buying and cedes the playing field to private investors," CNN reported at the time, "they will almost surely demand better return for their risk." "'Rates are going to be higher than they are now,'" said Brinkmann." (CNN was quoting Jay Brinkmann, chief economist for the Mortgage Bankers Association.) "How much higher is the question," concluded CNN. And that was the only question most observers were asking.

    So, what happened to mortgage rates after the Fed stopped buying? To the shock of everyone who thinks the Fed determines long-term interest rates -- that is, just about everyone who comments on such matters -- the rates went down. And down. And down some more -- to today's 3 percent or so.

    That was the record of QE1 (the policy, not the boat). QE2 began in the fall of 2011. With the economy still a-swoon and unemployment unacceptably high, the Fed announced it would begin buying bonds again. But this time, the Fed would buy not mortgage securities but Treasury bonds: US government debt. Massive amounts of it. Interest rates would go down. The economy would revive.

    But again, let's look at the numbers -- what actually happened. In November of 2010, when QE2 kicked off, the interest rate the Treasury paid to lenders in order to borrow money for 10 years was 2.67 percent. So when the "lender of last resort" -- the Fed -- stopped buying Treasuries at the end of June, 2011, the interest rate on the 10-year bond had to be lower, right? Okay, you take a guess: how much lower? What, in other words, was the effect of the Fed buying "Treasuries" to lower U.S. interest rates?

    Actually, the effect was, as they say in the world of medicine, "paradoxical." On June 30 of 2011, the interest rate the U.S. Treasury had to pay to borrow money for 10 years was 3.18 percent. The interest rate had not gone down, but up -- it had gone up substantially.

    And now, at last, we have QE3. It was formally announced on September 13 of 2012. The 10-year interest rate at the time? 1.75 percent. The 10-year rate today? 1.63 percent. A slight change at best.

    The punchline with regard to the all-important long-term interest rates should be clear: the Fed's influence is debatable.

    JAMES LIVINGSTON Why Saving for a Rainy Day is Pointless - For the Economy

    Final question, then: if the Fed isn't determining long-term interest rates, who or what is?

    Playing off posts on this page by economic historian Jim Livingston, let me offer this possibility: that the world has what Fed chairman Ben Bernanke dubbed, in 2005, a "global savings glut." In short: too much capital, chasing too few investment opportunities. It's an argument for another day, another post. But think about it.

    Maybe the business sector of 2013 doesn't need capital (stored wealth) the way it did in the past. No more railroads. No more steel mills. No more coal mines. In their place, software companies, which require relatively little investment to start and even get up to speed.

    Again, this is a thought for another day. But it's worth considering when blaming the Fed for taking undue risks.

    This entry is cross-posted on the Rundown -- NewsHour's blog of news and insight. Follow @PaulSolman

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  • 05/02/13--11:34: On the PBS NewsHour Tonight
  • On Thursday's NewsHour:

    President Barack Obama travels to Mexico with trade, security and immigration on the agenda

    The fight over access to emergency contraceptives continues as the Obama administration moves to appeal a federal ruling

    A bloody April for Iraq, where a wave of attacks has killed more than 700 people in the deadliest month in nearly five years

    Google's Eric Schmidt and Jared Cohen on their new book, "The New Digital Age," and the intersection of technology and democracy

    Evidence of cannibalism from dire days of Jamestown

    While the above promo is written for the radio in the morning, it is a tentative snapshot of what we're covering on the show. With the ebb and flow of news headlines, chances are segments will be added, scrapped or moved to another night.

    Tune in to the broadcast at 6 p.m. ET, online and on-air.

    Follow @NewsHour

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    Google leaders Eric Schmidt and Jared Cohen call the Internet "the world's largest ungoverned space," a space that is increasingly growing. The tech moguls outline their vision of a world universally connected to the Internet in their recent book, "The New Digital Age: Reshaping the Future of People, Nations and Business."

    Schmidt and Cohen argue that as more of the globe gains Web access, people will become empowered, having more choices and more freedom. While this will prove to benefit the majority of people, more connectivity will present new challenges that know no boundaries.

    In this exclusive online interview, Schmidt and Cohen talk with Judy Woodruff about how those among the world's remaining 5 billion who are not yet fully connected to the Internet are finding creative solutions to share information and engage in new ways.

    Tune in to the Thursday evening broadcast to watch the full interview. Watch on our live stream at 6 p.m. ET or check your local TV listings to find out when PBS NewsHour airs in your region.

    Do you have questions for Eric Schmidt or Jared Cohen? Leave your questions in the comments section at the bottom of the page or send them via Twitter by tweeting to @newshour with the hashtag #digitalage.

    JUDY WOODRUFF: And I'm back now with Eric Schmidt and Jared Cohen, talking about your book "The New Digital Age." You -- in the book, you talk about how, yes, we've got 2 billion people online right now, but it's just a matter of time before another 5 billion people are connected. But Eric, aren't a lot of those folks in really remote areas, very poor? It's hard to imagine how all those folks are going to get connected so quickly.

    ERIC SCHMIDT: These people are just like us. They're human beings as well. They're trapped in a bad system, they have poverty, but they have the same aspirations as we do. What they'll do is they'll be very clever. When a phone shows up, they'll share it. We saw, when we were in South Sudan, people were so excited about content that they would smuggle information on these little micro SD cards. Even without a network, they wanted to share information.

    JARED COHEN: In our travels, we've just encountered countless examples of people in these remote areas doing extraordinary things with mobile devices.

    So for instance, we were in Pakistan and met with a group of women who'd been attacked by the Taliban with acid, which tragically carries a terrible stigma in the physical world. They all live together and were able to essentially have a nonstigmatized identity online, starting businesses; some of them were ultimately able to meet people and eventually get married.

    So technology helps address some of the unique sets of challenges that our future users will encounter that are in fact very different from the 2 billion who are already connected.

    JUDY WOODRUFF: At the -- almost at the other end of the spectrum, you talk about some of these almost fantasylike scenarios of the future. A hologram vacation -- what is -- what's that all about?

    ERIC SCHMIDT: The -- in the developed world, the world with a lot of bandwidth -- and remember, Google has, you know, gigabit fiber projects now in America, and others are working on this as well -- we're going to have so much bandwidth and so much computation that we can begin to do things which seem like they came out of "Star Trek."

    And it'll be possible, for example, to have a memory room, which will reconstruct some visual memory that you have based on the history that you've recorded and the facts as they were.

    It'll be possible to have computers that make suggestions to you. It'll predict there's a traffic jam in an hour because it knows there's going to be a ballgame coming out. These assistants will make your life far, far more interesting. They'll make it visually interesting.

    They'll help you with your health. So for example, you'll take a pill that will go into your body, Wi-Fi out what's going on; the phone will call the doctor; the doctor will call you back if you're in trouble. Over and over again, the sort of, the Moore's Law, the sort of continuation of this exponential growth means that computers will serve us and make us more healthy.

    JUDY WOODRUFF: Is all that dependent on a healthy economy, that if you're not -- if people aren't making enough money to do all these things, they may not happen?

    ERIC SCHMIDT: Well, one argument, if I may -- one argument is that this is a declining-cost industry, and so as long as the fundamental rates of improvement of computing continue, which they will for some number of years -- they're slowing, but they're going to continue -- I think we can say that this will be true for almost everybody in America.

    JUDY WOODRUFF: What about --

    JARED COHEN: And more connectivity is actually positively correlated with the growth of an economy. This is one of the reasons we're so adamant about revealing dictators' dilemmas in the future, which is autocratic countries are used to hearing about their political alternatives.

    One of the reasons we went to countries like North Korea is to explain the technological alternative path that they can follow and to emphasize the fact that you -- in the future, you can't actually grow your economy without also expanding connectivity.

    JUDY WOODRUFF: Two specific issues or things I want to ask you about that you write about in the book, and one is the Arab Spring, where there's no question technology enabled so much of what happened.

    People think particularly about Egypt, but they think about the countries across that belt of the Middle East and North Africa. And yet it's much more complicated than just, oh, we have more information; now we're free. Doesn't -- I mean, is there a cautionary lesson in all that?

    JARED COHEN: The lesson that we argue in the book is that when you look at the Arab Spring countries and what's happened there is that in a future where everybody's connected, revolutions will be easier to start and happen faster, but they'll actually be harder to finish.

    They'll be harder to finish because the accelerated pace of movement-making will actually favor public figures, not necessarily seasoned leaders. The big lesson to take away is you still, even in an era of lots of connectivity, can't have a successful revolution if you don't have leaders and if you don't have functional institutions that can actually deliver for the population. So technology can help, but it can't manufacture those two things overnight.

    JUDY WOODRUFF: Want to add anything to that?

    ERIC SCHMIDT: I agree with that. I think that the empowerment bias creates this interesting phenomena where you can have these groups that look like they're going to be revolutionaries, and if you're the government, if you underestimate them, that might be to your peril, but you might also overestimate them, do some physical action which then legitimizes them, and now you've got a real social movement against you. It's much harder to be an autocrat in this new empowered world.

    JARED COHEN: And of course, one of the things that Eric and I speculate about in the book is you can imagine a situation where 10 years from now the celebrities of the Arab Spring become seasoned leaders, and amidst a presidential debate and a campaign, which all of a sudden starts to look more democratic, the crowd starts going back through the footage from the Arab Spring and compares their Arab Spring credentials.

    So the formula then becomes Arab Spring credentials plus real leadership skills equals a leader 10 years from now in the Middle East and North Africa.

    JUDY WOODRUFF: OK, the last thing I'd like to ask you about is something that you write about that it just is in the air and keeps coming back, and that of course is WikiLeaks and other, if you will, whistle-blower-type dumps of classified information put out there without any care as to who they may hurt.

    And -- but you are pretty confident -- you write confidently in the book that this is not going to proliferate as much as some people believe. What gives you that confidence?

    ERIC SCHMIDT: I think we -- we met with Julian Assange a couple of years ago, and without speaking about his legal troubles with respect to Sweden, we talked about his motivation. And he made a broad argument that there will be lots of such sites, that this technology was generally available.

    And yet if you looked, there haven't been very many. And one reason may be that the leakers have to trust the other side and that trust is something which is hard to manufacture in cyberspace because it's easy to be deceived on the end of a connection, especially if you're dealing with sort of shady people to start with.

    So I don't think -- and I think we now conclude that these will be much more rare than people thought, not to say that we're not endorsing them or not endorsing them; we're simply -- they're going to be fewer than people tend to think.

    JUDY WOODRUFF: Eric Schmidt, Jared Cohen, thank you very much.

    ERIC SCHMIDT: Thank you.

    JARED COHEN: Thank you.

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    JUDY WOODRUFF: President Obama arrived in Mexico City this afternoon to shore up the U.S. relationship with its southern neighbor and second largest export market.

    Immigration and security are also on the agenda, as the president begins his three-day Latin American trip. Shortly after Air Force One touched down in Mexico City this afternoon, Mr. Obama joined Mexico's new president, Enrique Pena Nieto.

    At a joint press conference, the president stressed the importance of the countries' relationship.

    PRESIDENT BARACK OBAMA: We can't lose sight of the larger relationship between our peoples, including the promise of Mexico's economic progress. I believe we have got a historic opportunity to foster even more cooperation, more trade, more jobs on both sides of the border, and that's the focus of my visit.

    JUDY WOODRUFF: U.S. immigration reform will be a central piece of their agenda. President Obama wants Congress to approve a plan that would provide visas for seasonal workers, as well as a pathway to citizenship for the 11 million people now living in the U.S. illegally.

    More than half are from Mexico, according to the Pew Research Center. At a November visit in Washington, then president-elect Pena Nieto voiced support for those proposals. But a key issue for Republicans is stepped-up security along the 2,000-mile shared border with Mexico and a stop to the flow of drugs, guns and crime.

    In the six-year drug war waged by Felipe Calderon, Pena Nieto's predecessor, Mexico saw more than 60,000 drug-related homicides. Pena Nieto campaigned on a promise to end that violence. And in April, his government claimed that killings had dropped 17 percent in the new president's first four months in office.

    Pena Nieto has also moved to take more control of his country's fight against the drug cartels. On Monday, his government confirmed that all security decisions would now run through the Interior Ministry, ending years of widespread direct access by U.S. agencies, like the CIA, to their Mexican equivalents.

    Mr. Obama was asked about the decision during a press conference the next day.

    PRESIDENT OBAMA: I'm not going to yet judge how this will alter the relationship between the United States and Mexico until I have heard directly from them to see, what exactly are they trying to accomplish?

    JUDY WOODRUFF: Both presidents are eager to stress the importance of economic ties on this trip. Mexico is America's second largest export market, and together the countries do more than a billion dollars in trade each day.

    Last year, the Mexican economy grew by almost four percent, and Pena Nieto has planned ambitious reforms for his six-year term. Tomorrow, President Obama will address Mexican entrepreneurs before heading on to Costa Rica.

    And joining me now to talk about the president's visit and the U.S.-Mexico relationship is Shannon O'Neill, a senior fellow at the Council on Foreign Relations and author of "Two Nations Indivisible: Mexico, the United States and the Road Ahead," and Diana Negroponte, a senior fellow at the Brookings Institution.

    Welcome to you both.

    Diana Negroponte, to you first.

    So Pena Nieto has only been in office a few months. Why was this meeting scheduled so early in his time?

    DIANA NEGROPONTE, Brookings Institution: It's important for Mexico to consolidate a good relationship with the U.S. president.

    So coming this early -- and, remember, they met before Pena Nieto took the oath of office, so they have met in November -- consolidates a personal relationship, we hope.

    JUDY WOODRUFF: Shannon O'Neil, how differently does -- just picking up on what Diana Negroponte just said, how differently does this administration see Pena Nieto from the way it saw his predecessors?

    SHANNON O'NEIL, Council on Foreign Relations: Well, Pena Nieto has come in with a big economic agenda, and he has very ambitious reforms on the plate. And some of them, he's already passed.

    So, he's passed a labor reform, an education reform, a telecommunications reform. And he's talking about energy and tax reform. And this is different from his predecessor, who had a hard time, particularly getting these issues through. So, that's something that the Obama administration wants to work with.

    But we have already seen, as you mentioned, changes on the security side, so an evolution in the way the U.S. and Mexico are going to work together in security situations, more centralized flows of information, which will change some of the day-to-day operations.

    JUDY WOODRUFF: But picking up on the economy, what can come out of this meet, Diana Negroponte, that would make things better?

    DIANA NEGROPONTE: I would hope that they could reach some private-public partnerships to build access roads on the border.

    Now, the border matters to trade. The border sees trucks and vegetables passing through each day, as well as human beings. But the logjam, the bottleneck is very bad. So if we can build with private money and public licenses some good access roads, we're going to facilitate trade.

    JUDY WOODRUFF: You mean because -- it's tough because of the immigration issues?

    DIANA NEGROPONTE: It's tough because each of those trucks will be examined by the CBP, the Customs and Border Patrol. So that creates bottlenecks, even though there are 53 points of entry. The volume of trade has quadrupled. We haven't opened enough border crossings. We need private investment there.

    JUDY WOODRUFF: And picking up on that and picking up on the immigration point, Shannon O'Neill, we have seen reports in the last few days that President Obama, seeing that there's more opposition to immigration reform, there may not be as many undocumented immigrants in this country who -- for whom there will be a pathway to citizenship. How much is that on the agenda of these two presidents?

    SHANNON O’NEIL: Well, they will be talking about this because it's an incredibly important issue for Mexico.

    Mexico has some 11 million citizens living in the United States, roughly six million of those here without papers who are undocumented. And they care. They hope to improve the rights and abilities of their citizens here. But I don't see the Mexican government wading into the politics here, because they have seen before the failures of previous big comprehensive immigration reforms. And having the Mexican government or any foreign government step in what is often seen as a domestic policy issue. We won't see any big public announcements on it.

    JUDY WOODRUFF: So, do you see them, Diana Negroponte, basically standing back and just watching with interest?

    DIANA NEGROPONTE: They watch very closely. They follow our immigration debate in detail, but they do not want to interfere because they have, as a principle, a concept of sovereign noninterference. So we shouldn't interfere in their energy debate.

    JUDY WOODRUFF: Well, let me ask you about the question of security. As we mentioned in the setup piece just a few minutes ago, this new president, Pena Nieto, changing the way the two countries will be dealing with each other when it comes to the drug war, trying to centralize where all the information goes. How much of a different does that portend to be?

    DIANA NEGROPONTE: We have had a very intense, close collaboration with the Mexican government over the last six years. Indeed, never has there been such a close collaboration between the two neighboring governments.

    So there's room to disengage somewhat. A concern for us is how the new security system develops. Will we be consulted? What is the nature of the dialogue between the two governments as Mexico shifts its security strategy?

    JUDY WOODRUFF: Shannon O'Neill, how do you see that? What do you see changing on the part of the Mexicans, and how do you see this administration responding to it?

    SHANNON O’NEIL: Well, one of the criticisms of the deepening over the last -- the last presidency, the last six years, has been that often the sharing of information was fragmented, it was decentralized. So agencies were talking to agencies, and even agents were talking to particular agents.

    So, the big strategic security plan, either nationally in Mexico or binationally, sometimes faltered because information wasn't shared. You couldn't see really what was happening. So in part this centralization of information flows will be good to have a clearinghouse where it's a bit clearer what's coming and what's going.

    What the challenge will be is that some of the information we have seen shared really for the first time in the last several years is quite sensitive. It's about active cases and then tracking down kingpins and the like. And here you may see reticence or caution on the U.S. side for sharing very sensitive information. They might do it with somebody they have been working with hand in hand and they begin to trust. But will they send it to a bureaucracy in Mexico City? That's a question that is still up there.

    JUDY WOODRUFF: Is there a concern on the U.S. part that the war effort could be weakened considerably because of this new situation, new system?

    DIANA NEGROPONTE: President Pena Nieto told us before that he would focus more on protecting Mexican citizens than going after drug kingpins.

    So we know that there's going to be a shift towards the interior of the country, keeping Mexicans safe from extortion, kidnapping, car robbery. That, we understand. But how you move towards that, the process itself is what is in negotiation or discussion now.

    JUDY WOODRUFF: What were you going to say, Shannon?

    SHANNON O’NEIL: Well, I was going to say security in Mexico in the end is really up to Mexico.

    And there are things that Mexico would like to do and that the United States can help them with. And those are things like helping with the transformation of the justice system, changing the way the court system works. The other things they can do is help clean up the police forces, make them more professional, as well as begin to expand the socioeconomic programs that help youth at risk or communities at risk.

    But, in the end, this is really Mexico's problem. We can help them, and we will, but in the end it's their responsibility. So this government is taking on that responsibility, and presumably doing what they think needs to be done, given how difficult the levels of violence still remain.

    JUDY WOODRUFF: And, of course, Mexico continuing to look to the U.S. and say, you are the ones who are the main market for these illegal drugs.

    Shannon O'Neill and Diana Negroponte, we thank you both.

    DIANA NEGROPONTE: Thank you. 

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    KWAME HOLMAN: President Obama nearly rounded out his second-term Cabinet today, making two nominations to his economic team. The president chose one of his longtime fund-raisers, billionaire philanthropist Penny Pritzker to lead the Commerce Department. And he tapped current economic adviser Michael Froman to be the next U.S. trade representative. Froman is a former executive at Citigroup.

    Mr. Obama made the announcements in the White House Rose Garden.

    PRESIDENT BARACK OBAMA: I have had a chance to get to know Penny and Mike not just as leaders and professionals, but also as friends. One of the reasons I'm proud to nominate them is they don't forget what matters. They know this is not about just growing balance sheets. It's about growing opportunity for people. It's about growing a sense of security for the middle class. And most of all, they operate with integrity and they understand that public service is a privilege.

    KWAME HOLMAN: Both nominees are predicted to have easy Senate confirmations. One final Cabinet nomination remains, to lead the Small Business Administration.

    There were reports out of Syria today that 50 to 100 people, including women and children, were killed by government troops and gunmen. The British-based Syrian Observatory for Human Rights said President Assad's forces took over a village near the Mediterranean coast. Many reportedly were executed by gunfire or knives. People who fled said other bodies were found burned.

    A North Korean court sentenced an American citizen to 15 years hard labor for what it said were crimes against the state. The U.S. State Department swiftly called for amnesty for 44-year-old Kenneth Bae.

    We have a report narrated by John Sparks of Independent Television News.

    JOHN SPARKS, Independent Television News: Here's what we do know about Kenneth Bae. He's an American citizen, a devout Christian, and he's been sentenced to 15 years hard labor in a North Korean work camp.

    Still, further details are harder to come by, Mr. Bae convicted of hostile acts in the country's top court, but the regime hasn't provided information on the proceedings or details of the crimes. He was arrested last November in Rason, a special economic zone on the border with China. Mr. Bae was leading a tour group at the time, but it's thought his interest in assisting North Korean orphans may have got him into trouble.

    But there is another explanation for his sentence. Mr. Bae not the first American to be arrested for hostile acts, and in recent years, dignitaries like former Presidents Carter and Clinton have made the trip to win their release. Bill Clinton helped free two U.S. journalists in 2009.

    LAURA LING, Journalist: When we walked in through the doors, we saw standing before us President Bill Clinton.

    JOHN SPARKS: But these visits are orchestrated by a regime desperate for aid and assistance.

    KWAME HOLMAN: A State Department spokesman said today the U.S. still is trying to learn the facts of Bae's case. No one from the Swedish Embassy in Pyongyang, which handles consular matters in North Korea for the U.S., was at the legal proceeding today.

    The number of deaths from the collapse of a garment factory in Bangladesh rose to 433 today. Relatives of the missing searched for the remains of their loved ones as bodies were laid out for identification. Police reported 149 people still are missing. It's the worst disaster in Bangladesh's garment industry, worth an estimated $20 billion dollars a year.

    A fire threatened -- a wildfire threatened homes and a university campus in Southern California today.

    It erupted this morning near Camarillo, 50 miles west of Los Angeles. Gusty Santa Ana winds made the fire hard to control as it raced along the US-101 freeway; 500 firefighters were battling the blaze, but it remained uncontained.

    The U.N.'s annual climate report shows last year was the ninth hottest since records started in 1850. And that was in spite of the cooling effect of the weather pattern La Nina. 2012 also marked the 27th straight year in which the global average temperature surpassed 58 degrees Fahrenheit, the average of all the years from 1961 to 1990.

    Stocks on Wall Street rose today as the European Central Bank cut its key interest rate and American jobless claims fell. The Dow Jones industrial average gained more than 130 points to close at 14,831. The Nasdaq rose 41 points to close above 3,340.

    Those are some of the day's major stories -- now back to Jeff.

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    JEFFREY BROWN: And we return to the battle over emergency contraception, the so-called morning after pill.

    It's been more than a decade since the pill was first approved by the FDA, but legal and political controversy has swirled ever since. In 2011, the FDA decided the drug should be available to all girls and women, without prescription.

    In an unprecedented action, Health and Human Services Secretary Kathleen Sebelius quickly overruled the agency, keeping the age limit at 17 and older.

    Last month, a federal judge ordered that restriction lifted in a strong rebuke to the administration.

    And then, on Tuesday, the FDA set a new age limit, 15 and older, for the most popular version of the pill, known as Plan B One-Step. And last night, the Department of Justice said it will fight the federal judge's broader decision that the drug should be available to all girls and women.

    Julie Rovner of NPR is here to help sort it all out.

    And I hope you will, because it's complicated. Welcome back.

    JULIE ROVNER, National Public Radio: Thank you.

    JEFFREY BROWN: First, the latest decision from the Department of Justice, appealing the ruling by the judge, why? What are they saying?

    JULIE ROVNER: Well, this is more of a process appeal, not so much a substance appeal.

    They're saying the judge overstepped his abilities, that this has more to do with the way the FDA does its approval of drugs, and that he really -- the judge really didn't have the authority to order all drugs, that this was really simply about this one drug, the Plan B One-Step, and that really that he didn't -- he wasn't able to do what it is that he's trying to do, which is order all emergency contraceptives to be made available over the counter to women of all ages.

    JEFFREY BROWN: And not only did he do that, but he did that in a very forceful way.

    JULIE ROVNER: Yes, he did.

    JEFFREY BROWN: A very -- put-down against the administration.

    JULIE ROVNER: He did, indeed.

    This has been going on since 2005. This judge has had this case before it through two administrations now, and he said that -- so he had strongly rebuked the Bush administration before and the Obama administration now for really sitting on this issue.

    JEFFREY BROWN: OK, now, in the meantime this week, also, the FDA comes out with a -- yet a new plan, a sort of compromise? Or how did -- what are they doing?

    JULIE ROVNER: You know, they had this had nothing to do with the judge's order, but it's really hard to square that with the fact that they had been sitting on this drug application from the pharmaceutical company, Teva Pharmaceutical, since 2011.

    So -- and yet it comes four days before the deadline to act. And it did, as you mentioned, reduce the age of -- for people who do have to have a prescription down to 14, basically, so people, women 15 and up could get it without a prescription.

    Something very important, though, that would change also under what the FDA did, before, because there was this split ruling where some people had to have a prescription and some didn't, you had to get the product from behind the pharmacy counter. You had to go and ask someone at the pharmacy, either the pharmacist or a pharmacy clerk for it, which meant you could only get it when the pharmacy was open. You had to show I.D.

    Now they're saying that it can be sold on the shelves of retail stores that have pharmacies. So, you won't be able to get it at a convenience store, but you will be able to get it at a Target, or a Wal-Mart, or a grocery store that has a pharmacy. So, that will make it more available.

    But, still, you will have to show I.D. to a cashier. There will be literally a chip embedded that when you go to ring it up, it will tell the cashier, I.D. must be shown and you must be 15 or older.

    JEFFREY BROWN: Now, as we heard in Judy's segment, the president is in Mexico. He's speaking right now at a press conference. And so I'm just seeing that he was asked about this. And he said, "I'm comfortable with the FDA decision allowing girls 15 and up to buy the pill."

    Now, that's an interesting question, because it's not clear, quite clear. The FDA is over here, the Department of Justice over here. The administration is over here.

    JULIE ROVNER: Well, that's not really a surprise, because, remember, when the FDA wanted to take off all the age restrictions, they were overruled by Sec. Sebelius, who said she was uncomfortable with taking off the age restrictions because of very young teenagers. And by very young, she said there wasn't enough information on perhaps the 13- and 14-year-olds.

    She was immediately backed up by the president, who, remember, has two young teenagers of his own, and I think there was concern about those very young teens. So I'm not surprised that both the president and presumably Sec. Sebelius, who we haven't heard from, would be comfortable with 15 and up. Now, the concern that women's health groups have about this is that these 15- and 16-year-olds, who this has now been extended to, a lot of them won't have I.D.

    Remember, they're mostly too young to drive. They said they can present a passport or a birth certificate. It's unlikely that that's something that they will be walking around with either.


    Well, as we said, this has been politically fought for a long time, so where does that leave the politics right now? Who is happy and who is not happy? Is anybody happy?

    JULIE ROVNER: I don't think anybody is happy.


    JULIE ROVNER: I think the people who really didn't want this to be made more available, some of the more conservative Christian groups, don't like it at all. The women's health groups want all of the restrictions removed.

    The administration sort of wants no part of this. And, remember, you have now got the Justice Department representing the FDA. Well, we know that the FDA's position was originally to remove all restrictions.

    So, it's really hard to know who wants what right now.

    JEFFREY BROWN: And what does happen next?

    JULIE ROVNER: Well, they go before the judge. The judge has just given a few extra days to argue about whether or not they will get a stay in this order.

    Remember, the judge has ordered the FDA to remove all restrictions, originally by next Monday. So now they're going to argue about whether or not the judge is going to stay this order while this is being appealed.

    JEFFREY BROWN: And let me just ask you briefly, do we know -- in the meantime, the use of the morning after pill, do we know, is it growing? Has it stabilized?

    JULIE ROVNER: There has been some more use, but, again, there have been these barriers, as I mentioned, not just for younger women, but for older women who have had trouble getting it because it's been kept behind the pharmacy counter, and there have been difficulties with it.

    JEFFREY BROWN: All right, Julie Rovner of NPR, thanks so much.

    JULIE ROVNER: Thank you. 

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    JUDY WOODRUFF: And we turn to Iraq, where the country just had its deadliest month in nearly five years. Ray Suarez reports on the recent surge in violence and what's behind it.

    RAY SUAREZ: Twisted wreckage and shattered glass strewn across central Iraq, the aftermath of all-too-familiar bombings. Four coordinated attacks Monday in four Shiite cities south of Baghdad killed more than 35 people. Multiple attacks yesterday killed 22 more.

    MAN: Do Allah and Prophet Mohammed accept this? No one is safe. You do not know if you will come back to a house or not when you go to work.

    RAY SUAREZ: The attacks, dozens in the last month, are the most serious spasm of violence since American troops left nearly 18 months ago. Today, the United Nations mission in Iraq said April was the deadliest month since June 2008. More than 700 people were killed, almost all in Baghdad. Nearly 600 were civilians.

    Coupled with the Sunni-Shiite bloodletting in neighboring Syria, all this has rekindled fears of sectarian war in Iraq. Years of such violence tore the country apart after the American invasion, and killed tens of thousands.

    MAN: The explosions have escalated nowadays in the south and the middle of the country, especially since Hawijah events, when the Iraqi troops stormed a protest site.

    RAY SUAREZ: That attack in Hawijah by the predominantly Shiite security forces last week resulted in 20 dead Sunni protesters. They had set up camp about 100 miles north of Baghdad to oppose what they saw as the increasingly sectarian bent of Shiite Prime Minister Nouri al-Maliki and his government.

    A string of bombings followed the Hawijah attack. Sunni militants skirmished with security forces, and the telltale car bombings of al-Qaida in Iraq ramped up. But another group is also coming to the fore. The Men of the Army of the Naqshbandi Order, known by its Arabic acronym, JRTN, is a Sufi Islamist militant group.

    The group was formed after Saddam Hussein's execution in late 2006. One of its strongholds is Hawijah. JRTN is allegedly headed by the highest-ranking Saddam aide to elude capture, Izzat Ibrahim al-Douri. He was the king of clubs in the U.S. military's famous deck of cards of wanted Iraqis.

    Last week, Prime Minister Maliki sought to tamp down the sectarian fervor, now rife in Syria, and again threatening Iraq.

    PRIME MINISTER NOURI AL-MALIKI, Iraq: I can honestly say that, if the sectarian sedition bursts, there will not be a winner or a loser. All of us will be losers, whether those who are in the south or in the north, in the east or west of the country. Let those who foment sectarianism, whether they are from inside or outside the country, be ready to burn themselves in the fire of sectarian strife.

    RAY SUAREZ: On Monday, Iraq's Media Commission took what it said was a step to end that strife. It suspended licenses for 10 satellite channels.

    SALEM MASHKOUR, Iraq Communications and Media Commission: We had direct meetings with the channels' administrations and we asked them to change their language, taking a stand against those who call for violence, sectarian strife and sectarian killing. They were calling for direct killing recently, so this is inconsistent with the norms and standards adopted by free press in most democracies.

    RAY SUAREZ: Most were Sunni-affiliated operations. The commission is powerless, however, to stop broadcasts altogether. 

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    RAY SUAREZ: For more on all of this we get two views. Ryan Crocker was U.S. ambassador to Iraq from 2007 to 2009 and is now a distinguished professor at the Miller Center at the University of Virginia. And Feisal Istrabadi is the director of the Center for the Study of the Middle East at the School of Global and International Studies at Indiana University. He also served as Iraq's deputy ambassador to the United Nations from 2004 to 2007.

    Ambassador Istrabadi, let's start with you. How do you explain the recent upsurge in violence in Iraq?

    FEISAL ISTRABADI, Former Deputy Iraqi Ambassador to United Nations: Well, of course, the -- it is an upsurge. That's an important word. That is to say, there has been an ongoing degree of violence for some time sort of percolating along. I think a number of things have occurred.

    I think that the Maliki government has -- Nouri al-Maliki himself has been asserting greater and greater control over the instrumentalities of the state, and I -- and has been unable or unwilling to enter or execute the compromises that Gen. Petraeus had worked out at the time of the American troop surge.

    And these chickens have sort of come home to roost at this point, and the dissatisfaction has just boiled over, I think.

    RAY SUAREZ: Ambassador Crocker, is that how it looks to you, that an increasingly controlling Iraq prime minister is what is bringing on all this new violence?

    RYAN CROCKER, Former U.S. Ambassador to Iraq: I think Feisal is right, Ray.

    It's a very complex situation, obviously. There is an Iraqi domestic sectarian element, with Iraq Sunnis unhappy over actions taken against prominent Sunni politicians, most recently charges against the highly regarded minister of finance, Rafi Issawi, as well as the decision to postpone provincial elections in two predominantly Sunni provinces, Nineveh and Anbar.

    But there's another element as well that is captured in your clip. Al-Qaida in Iraq is very much on the offensive, and they have combined with Syrian al-Qaida, Jabhat al-Nusra, in a truly horrific alliance. So these attacks from al-Qaida, of course, play into an increase in sectarian tension that erupted in violence in Hawijah, as you pointed out, on April 23rd.

    I think it is a time when the prime minister, who we just heard call for steps to stop sectarian tensions, and other Iraqi politicians to take a deep breath, consider all that they have achieved, and not risk losing it now.

    RAY SUAREZ: Ambassador Istrabadi, do you, like Ryan Crocker, see some of the Syrian conflict spilling over into Iraq?

    FEISAL ISTRABADI: Well, I have no doubt that Ryan is right about that, but I have to say that we have been -- that the sectarian violence, again, never truly subsided in Iraq. There's always been an undercurrent of it.

    And I don't believe, myself, that the Syrian crisis is fanning the flames in Iraq as such. Rather, with these sorts of alliances of convenience that Ryan just mentioned, what you have is perhaps, if you're a Sunni tribal sheik, you might look the other way when you see an al-Qaida operative or an al-Qaida cell operating, if you believe that you have been sort of permanently disenfranchised from the current political -- from the current polity.

    So, while I think it's contributing to it, I don't think it's a causative factor. I might also say that part of the paralysis of the Maliki government, in my view, is that as they see what seemed, at least, to be sort of a Shia government falling in Syria, he was, I think, Maliki, was concerned that that would be a precedent in Iraq and that that has made him more intransigent in terms of making a political settlement of the issues.

    RAY SUAREZ: Ambassador Crocker, you have called this recent situation reminiscent of the days in 2006 that led to virtual civil war in Iraq. Is Iraq sliding towards civil war today?

    RYAN CROCKER: I don't think Iraq is at that point.

    But I do think the caution has to be sounded. The violence in Hawijah, when predominantly Shia security forces attacked a Sunni protest encampment and killed 20 people, is a very dangerous sign. And I think it should be the signal for Iraqis of all sects and ethnicities to take a very deep breath, to recognize that they could slide back into chronic sectarian violence that they and we worked so hard to put an end to.

    The tensions are not new, as Feisal knows. But what is important is that they be resolved and worked through in a context of negotiation, of peaceful endeavor. And I think the prime minister's call that you just publicized for an end to sectarianism is an important step in that direction. And I think what spokespersons for Grand Ayatollah Sistani may have to say tomorrow after Friday prayers will be important. And what Iraq politicians say and do will be important.

    RAY SUAREZ: Ambassador Istrabadi, the U.S. has basically left the country, unable to negotiate a remaining force with the government in Baghdad. Does the United States still have any leverage there, any influence?

    FEISAL ISTRABADI: Well, the United States still has, I think, tremendous leverage and tremendous influence.

    Iraq is not the only country -- I don't think there's a country in the world that the United States doesn't have influence over to some degree, including a place like North Korea, let alone Iraq.

    It has tremendous influence there. The Iraqis want to buy American arms. The Iraqis want to have good commercial relations with the United States. They want to have American companies invest in Iraq. At some point, Iraq will want World Trade Organization membership. There are tremendous levers that are at the disposal of the United States.

    They may not quite be what they were when Ambassador Crocker was in Baghdad and there were 150,000 troops, but there are still levers that can and should be used by the administration to try to extricate Iraq from its -- what appears a descent into another round of chaos.

    RAY SUAREZ: Well, Ambassador Crocker, you not only need influence. You need a government that has the talent, and the credibility, and the juice, the power to de-escalate the current violence and bring some stability to the country. Does the al-Maliki government have that?

    RYAN CROCKER: We have seen a pattern that was very present during my time there that, given the still embryonic development of a new open political system in Iraq, Iraqis sometimes find it difficult to make compromises directly with each other.

    They can do it through a mediator. And we played that role many, many times during my time in Baghdad. I think, as Feisal suggests, we need to do it again. We do have influence, precisely for the reasons he stated. We need to use it. And I think, with the new team in the administration, particularly Sec. Kerry, as secretary of state, Sec. Hagel, as secretary of defense, two committed internationalists, we have the people who could have a real impact.

    The influence is there. We need to use it.

    RAY SUAREZ: Well, you gentlemen will be keeping an eye on the situation, as we will here.

    Ambassadors Ryan Crocker and Feisal Istrabadi, thank you, gentlemen, both. 


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