The head of America's National Security Agency says that America needs to build a digital warfare force for the future, according to reports.
Lt Gen Keith Alexander, who also heads the Pentagon's new Cyber Command, outlined his views in a report for the House Armed Services subcommittee.
In it, he stated that the US needed to reorganise its offensive and defensive cyber operations.
The general also said more resources and training were needed.
The report, part of which was outlined in an Associated Press news agency story, is due to be presented to the subcommittee on Tuesday.
During the past six months, the Pentagon spent more than £67m ($100m) responding to and repairing damage from cyber attacks and other network problems.
Gen Keith Alexander's new department, to be based in Fort Meade in Maryland, will be part of the US Strategic Command - currently responsible for securing the US military's networks - and will work alongside the US Department of Homeland Security.
It is thought the new department would open in October and be at full strength in 2010.
Self defence
A separate document, from the US Air Force's chief information officer Lt Gen William Shelton, said the US relies heavily on industry efforts to respond to cyber threats which, he says, "does not keep pace with the threat".
The proposed digital warfare force would be based in Maryland
Peter Wood, operations chief with First Base Technologies and an expert in cyber-warfare, said that the US were entirely within their rights to protect themselves.
"My own view is that the only way to counteract both criminal and espionage activity online is to be proactive. If the US is taking a formal approach to this, then that has to be a good thing.
"The Chinese are viewed as the source of a great many attacks on western infrastructure and, just recently, the US national grid. If that is determined to be an organised attack, I would want to go and take down the source of those attacks," he said.
"The only problem is that the internet - by its very nature - has no borders and if the US takes on the mantle of the world's police; that might not go down so well."
The submissions to the House Armed Services subcommittee comes a few days after the National Research Council - part of the United States National Academy of Sciences - said that current US policies on cyber warfare are "ill-formed, lack adequate oversight and require a broad public debate".
The report went on to say that the "undeveloped and uncertain nature" of the US governments cyber warfare policies could lead to them being misused in a possible crisis.
The US administration is due imminently to publish the results of a 60-day review on cyber-security ordered by President Obama.
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Tuesday, May 5, 2009
Swat residents 'flee their homes'
Residents of Pakistan's Swat Valley are reported to be fleeing their homes despite authorities rescinding an earlier order for them to leave.
A peace deal between the government and Taleban militants in the region appears close to collapse after the army said militants attacked police checkpoints.
There has also been heavy fighting to the west and east of Swat.
A major army operation against the Taleban appears likely within a few days, says the BBC's Syed Shoaib Hasan.
Our Islamabad correspondent says the army seems in an uncompromising mood, with the renewed violence apparently the death knell for the peace deal, which has held since February.
See a map of the region
In other violence, a suicide bomber killed four security personnel near Peshawar, North West Frontier Province.
Police said the attacker rammed an explosive-laden car into a military vehicle.
It is not yet known who is behind the attack, but Taleban militants are known to be active in the province.
Patrols
Pakistani Information Minister Mian Iftikhar Hussain said the government was preparing six camps to cater for up to 500,000 people fleeing fighting in the region, AP news agency reported.
The town of Dargai, near the Swat border, is reported to be where at least one camp is being built.
Armed Taleban fighters have been openly patrolling, the army says
A Pakistani military spokesman, Maj-Gen Athar Abbas, told the BBC the Taleban had violated all the norms of the peace deal in Swat Valley.
He said the Taleban had sent out armed patrols and had gone into the neighbouring Dir and Buner districts.
The army says militants attacked checkpoints and bases in four different locations in Swat, and that armed militants are openly patrolling the streets of the district's main city Mingora.
A witness in Mingora told AP that black-turbaned militants were deployed on most streets and on high buildings, and that security forces were barricaded in their bases.
Khushal Khan, district co-ordination officer in Swat, told the BBC that residents of areas around Mingora had been told to evacuate because there was a fear that the Taleban could use heavy weapons to attack security forces.
But he said the order was later rescinded when the attacks no longer seemed likely.
However, reports say residents are fleeing in their hundreds anyway, taking advantage of the government's lifting of a curfew.
Taleban spokesman Muslim Khan said that the militants were in control of "90%" of the valley.
He told AP that Taleban actions were in response to the army violating the peace deal. He said the peace deal had "been dead" since the army's recent offensive in neighbouring Buner district.
"Everything will be OK once our rulers stop bowing before America," he said.
Washington talks
The deteriorating situation in Pakistan's north-west came as President Asif Ali Zardari was preparing for talks in Washington on Wednesday.
Analysts say US President Barack Obama will seek assurances from Mr Zardari that his country's nuclear arsenal is safe from Taleban insurgents and that Pakistan intended to root-out militant groups and defeat them.
Militants fought the army in the region from August 2007 until this year's deal.
Under the deal the Taleban were expected to disarm.
The Taleban say they will not lay down their arms until Islamic Sharia law is fully implemented in Swat.
They have banned the playing of music in cars and are also using mosques to invite local youth to join them.
A peace deal between the government and Taleban militants in the region appears close to collapse after the army said militants attacked police checkpoints.
There has also been heavy fighting to the west and east of Swat.
A major army operation against the Taleban appears likely within a few days, says the BBC's Syed Shoaib Hasan.
Our Islamabad correspondent says the army seems in an uncompromising mood, with the renewed violence apparently the death knell for the peace deal, which has held since February.
See a map of the region
In other violence, a suicide bomber killed four security personnel near Peshawar, North West Frontier Province.
Police said the attacker rammed an explosive-laden car into a military vehicle.
It is not yet known who is behind the attack, but Taleban militants are known to be active in the province.
Patrols
Pakistani Information Minister Mian Iftikhar Hussain said the government was preparing six camps to cater for up to 500,000 people fleeing fighting in the region, AP news agency reported.
The town of Dargai, near the Swat border, is reported to be where at least one camp is being built.
Armed Taleban fighters have been openly patrolling, the army says
A Pakistani military spokesman, Maj-Gen Athar Abbas, told the BBC the Taleban had violated all the norms of the peace deal in Swat Valley.
He said the Taleban had sent out armed patrols and had gone into the neighbouring Dir and Buner districts.
The army says militants attacked checkpoints and bases in four different locations in Swat, and that armed militants are openly patrolling the streets of the district's main city Mingora.
A witness in Mingora told AP that black-turbaned militants were deployed on most streets and on high buildings, and that security forces were barricaded in their bases.
Khushal Khan, district co-ordination officer in Swat, told the BBC that residents of areas around Mingora had been told to evacuate because there was a fear that the Taleban could use heavy weapons to attack security forces.
But he said the order was later rescinded when the attacks no longer seemed likely.
However, reports say residents are fleeing in their hundreds anyway, taking advantage of the government's lifting of a curfew.
Taleban spokesman Muslim Khan said that the militants were in control of "90%" of the valley.
He told AP that Taleban actions were in response to the army violating the peace deal. He said the peace deal had "been dead" since the army's recent offensive in neighbouring Buner district.
"Everything will be OK once our rulers stop bowing before America," he said.
Washington talks
The deteriorating situation in Pakistan's north-west came as President Asif Ali Zardari was preparing for talks in Washington on Wednesday.
Analysts say US President Barack Obama will seek assurances from Mr Zardari that his country's nuclear arsenal is safe from Taleban insurgents and that Pakistan intended to root-out militant groups and defeat them.
Militants fought the army in the region from August 2007 until this year's deal.
Under the deal the Taleban were expected to disarm.
The Taleban say they will not lay down their arms until Islamic Sharia law is fully implemented in Swat.
They have banned the playing of music in cars and are also using mosques to invite local youth to join them.
Monday, May 4, 2009
ADB sees 'mild recovery' next year
The Asian Development Bank (ADB) called on Monday for a fundamental "rebalancing" of regional economies in response to the global crisis, while predicting a "mild recovery" next year.
Bank President Haruhiko Kuroda said the region would record only 3.4 percent growth this year but could expect a rebound to around 6.0 percent growth in 2010, as he opened the ADB's board of governors annual meeting in Bali.
"With strong national and regional efforts and a mild recovery expected in the global economy next year, developing Asia and the Pacific should bounce back to about 6.0 percent growth in 2010," he said.
"These are positive signs, therefore this should not be a time of despair."
He outlined a huge expansion in the ADB's lending plans to help stimulate developing economies across Asia, after shareholders agreed last week to triple the bank's capital base in response to the global downturn.
The bank will increase its overall lending assistance to the region's poorest countries by more than 10 billion dollars in 2009 and 2010, including three billion to meet "urgent needs stemming from the crisis," Kuroda said.
Some of that new lending would aim to help Asian economies adjust to plunging demand for their exports to markets such as Europe and the United States.
"The transfer of savings from one part of the world to another worked well when advanced economies could absorb production from developing economies, but the current state of the global economy suggests that era has passed," Kuroda said.
"By rebalancing export-driven growth with a greater reliance on domestic demand and consumption, Asia can lead the way in charting a new, globally beneficial development course."
Interest rate cuts and government spending will help spur the recovery in Asia, whose banks are not suffering problems on the same scale as their US and European peers, according to the International Monetary Fund.
Recent economic data have raised hopes that China could be the first major economy to disentangle itself from the worldwide crisis, providing new growth momentum for its trading partners across the region.
In India, expectations of a healthy harvest fuelling consumer spending has driven India's benchmark Sensex share index to a six-month high as fund managers switch their country ratings to "overweight" from "underweight."
Japan's factory output rose 1.6 percent in March from the previous month, the first increase since September, triggering a buying spree on the Japanese sharemarket last week.
Kuroda also called for changes to the global financial architecture to give voice to the aspirations of Asia, where powerhouses like China and India are emerging as rivals to US domination of the world economy.
Ten Asian countries plus China, Japan and South Korea agreed on Sunday to set up a 120-billion-dollar regional emergency fund to help Asian economies out of crises, a move Kuroda applauded.
"It is... important to create a financial architecture that gives developing countries a voice more commensurate with their share of world output and trade," he said.
His comments echoed China's calls for a greater say in international economic decision-making at institutions such as the IMF.
Indonesian President Susilo Bambang Yudhoyono said "precautionary mechanisms" like the regional liquidity fund were necessary to "ensure foreign exchange stability and confidence" in crisis-hit local currencies.
He said Indonesia, Southeast Asia's biggest economy, had learnt from the economic turmoil that swept Asia in the late 1990s and had launched "sweeping reforms" that helped it avoid recession in the current downturn.
The Indonesian economy is forecast to track the regional rebound, with growth of around four percent this year recovering to six percent in 2010.
Bank President Haruhiko Kuroda said the region would record only 3.4 percent growth this year but could expect a rebound to around 6.0 percent growth in 2010, as he opened the ADB's board of governors annual meeting in Bali.
"With strong national and regional efforts and a mild recovery expected in the global economy next year, developing Asia and the Pacific should bounce back to about 6.0 percent growth in 2010," he said.
"These are positive signs, therefore this should not be a time of despair."
He outlined a huge expansion in the ADB's lending plans to help stimulate developing economies across Asia, after shareholders agreed last week to triple the bank's capital base in response to the global downturn.
The bank will increase its overall lending assistance to the region's poorest countries by more than 10 billion dollars in 2009 and 2010, including three billion to meet "urgent needs stemming from the crisis," Kuroda said.
Some of that new lending would aim to help Asian economies adjust to plunging demand for their exports to markets such as Europe and the United States.
"The transfer of savings from one part of the world to another worked well when advanced economies could absorb production from developing economies, but the current state of the global economy suggests that era has passed," Kuroda said.
"By rebalancing export-driven growth with a greater reliance on domestic demand and consumption, Asia can lead the way in charting a new, globally beneficial development course."
Interest rate cuts and government spending will help spur the recovery in Asia, whose banks are not suffering problems on the same scale as their US and European peers, according to the International Monetary Fund.
Recent economic data have raised hopes that China could be the first major economy to disentangle itself from the worldwide crisis, providing new growth momentum for its trading partners across the region.
In India, expectations of a healthy harvest fuelling consumer spending has driven India's benchmark Sensex share index to a six-month high as fund managers switch their country ratings to "overweight" from "underweight."
Japan's factory output rose 1.6 percent in March from the previous month, the first increase since September, triggering a buying spree on the Japanese sharemarket last week.
Kuroda also called for changes to the global financial architecture to give voice to the aspirations of Asia, where powerhouses like China and India are emerging as rivals to US domination of the world economy.
Ten Asian countries plus China, Japan and South Korea agreed on Sunday to set up a 120-billion-dollar regional emergency fund to help Asian economies out of crises, a move Kuroda applauded.
"It is... important to create a financial architecture that gives developing countries a voice more commensurate with their share of world output and trade," he said.
His comments echoed China's calls for a greater say in international economic decision-making at institutions such as the IMF.
Indonesian President Susilo Bambang Yudhoyono said "precautionary mechanisms" like the regional liquidity fund were necessary to "ensure foreign exchange stability and confidence" in crisis-hit local currencies.
He said Indonesia, Southeast Asia's biggest economy, had learnt from the economic turmoil that swept Asia in the late 1990s and had launched "sweeping reforms" that helped it avoid recession in the current downturn.
The Indonesian economy is forecast to track the regional rebound, with growth of around four percent this year recovering to six percent in 2010.
Apartheid funded by the Indian tax-payer
In an era when one set of Indians is manning the world’s knowledge back-office with distinction, another set of children — in Madhya Pradesh, which the ruling BJP often showcases as a “model state” – has to face such discrimination and humiliation. Everyday.
This Indian version of apartheid is taking place in schools and childcare centres run by the government, and in schemes funded by the tax-payer’s — in other words, your – money.
They are forced to sit in separate rows, bring utensils from home or given food in plates marked boldly with permanent ink to distinguish them from the rest.According to a survey on social discrimination conducted by Jansahas, an NGO, and Unicef, in 24 villages across four districts – Ujjain, Sheopur, Katni and Jhabua – in Madhya Pradesh, more than 63 per cent of Dalit children are subjected to caste discrimination while being served mid-day meals in government schools.
They are forced to sit in separate rows, bring utensils from home or given food in plates marked boldly with permanent ink to distinguish them from the rest.
The Mid-Day Meal Scheme, funded by the government, is the world’s largest school lunch programme and covers 120 million children. Ironically, one of the key objectives of the scheme is to increase socialisation among children of different caste groups.
“As many as 40 per cent of Dalit students facing discrimination were given mid-day meals in plates specially set aside for them,” Jansahas activist Ashif Sheikh told Hindustan Times.
While some were asked to bring utensils from home, most were served their mid-day meals on leaf plates. Non-Dalits, however, were served on metal plates.
The survey found that most teachers were insensitive to the discrimination against Dalits because of caste-based traditions being followed in rural areas, he said.
In a majority of the schools surveyed, Dalit students were not allowed to sit in the front row. As many as 78 per cent of school-going Dalit students were backbenchers or forced away from the front row and subjected to casteist abuses.
And 79 per cent of such students were compelled to clean the schools. In some schools, this chore was given only to Dalit girls.
The survey found that the Anganwadi scheme, a government-sponsored mother and childcare scheme catering to children in the 0-6 age group, also discriminates against Dalits. About 59 per cent of Dalits said they desisted from sending their children to the local anganwadi facilities.
The victims claimed that Dalit children were not allowed to enter the anganwadis and were forced to accept nutritional supplements outside the building.
The survey concluded that caste discrimination is one of the prominent reasons for the absence of Dalit children from school.
This Indian version of apartheid is taking place in schools and childcare centres run by the government, and in schemes funded by the tax-payer’s — in other words, your – money.
They are forced to sit in separate rows, bring utensils from home or given food in plates marked boldly with permanent ink to distinguish them from the rest.According to a survey on social discrimination conducted by Jansahas, an NGO, and Unicef, in 24 villages across four districts – Ujjain, Sheopur, Katni and Jhabua – in Madhya Pradesh, more than 63 per cent of Dalit children are subjected to caste discrimination while being served mid-day meals in government schools.
They are forced to sit in separate rows, bring utensils from home or given food in plates marked boldly with permanent ink to distinguish them from the rest.
The Mid-Day Meal Scheme, funded by the government, is the world’s largest school lunch programme and covers 120 million children. Ironically, one of the key objectives of the scheme is to increase socialisation among children of different caste groups.
“As many as 40 per cent of Dalit students facing discrimination were given mid-day meals in plates specially set aside for them,” Jansahas activist Ashif Sheikh told Hindustan Times.
While some were asked to bring utensils from home, most were served their mid-day meals on leaf plates. Non-Dalits, however, were served on metal plates.
The survey found that most teachers were insensitive to the discrimination against Dalits because of caste-based traditions being followed in rural areas, he said.
In a majority of the schools surveyed, Dalit students were not allowed to sit in the front row. As many as 78 per cent of school-going Dalit students were backbenchers or forced away from the front row and subjected to casteist abuses.
And 79 per cent of such students were compelled to clean the schools. In some schools, this chore was given only to Dalit girls.
The survey found that the Anganwadi scheme, a government-sponsored mother and childcare scheme catering to children in the 0-6 age group, also discriminates against Dalits. About 59 per cent of Dalits said they desisted from sending their children to the local anganwadi facilities.
The victims claimed that Dalit children were not allowed to enter the anganwadis and were forced to accept nutritional supplements outside the building.
The survey concluded that caste discrimination is one of the prominent reasons for the absence of Dalit children from school.
Michael Hiltzik:Credit card companies as evil villains? It's not that simple
Is there any business in the United States more vilified than credit card lending?
The card companies stand accused by Congress and the Federal Reserve of gouging customers with impenetrable fees, enticing innocents to borrow themselves into bankruptcy, and blowing off cardholders who try to correct errors in their accounts.
Attacking these firms is a crowd-pleasing sport for lawmakers, in part because every constituent has a story about being mulcted by a card issuer. Last week the House of Representatives easily passed a credit card holders’ bill of rights. The Senate will take up a similar measure soon. President Obama has signaled his approval.
Someone has to stand up for these companies. I guess it'll have to be me.
Before I try to inject some perspective into the debate about card issuers, I'll stipulate that they've been guilty of genuinely sleazy behavior -- much of which is properly targeted by the measures in Washington.
They shouldn't be allowed to jack up the interest rate on card balances retroactively, except in rare cases. They should apply your payments to balances with the highest rates first. They shouldn't accept charges that put you over your credit limit and trigger a fee, if you request such a hard cap.
And they should be barred from marketing directly to young persons. Cards used to be hard to get if you had no credit history. But I could wallpaper my house with the come-ons that now come addressed to my college-age kids, a practice the banks must have learned from cigarette companies handing out free smokes at rock concerts.
But we routinely berate card issuers for actions that are actually prudent and wise. Certain purported sins, such as raising rates and cutting credit limits for some borrowers, merely ratchet back the loose standards that helped lead us to economic perdition. For years we cursed the banks for showering Americans with easy credit. Now we curse them for tightening up.
Because of their unsavory past, the issuers are unable to make this case for themselves. They remind me of some frat guys at my college who were guilty of only about half the things they were accused of, but what was true was bad enough. From them I learned this tenet of the court of public opinion: Once you've been caught firing guns at African American students from the frat house roof, no one will believe you're innocent of anything.
Still, it's proper to take an unemotional look at the rest of the prosecution brief against credit card companies.
One frequent complaint is that issuers arbitrarily jack up interest rates and slash credit limits even on customers with pristine records. Given the straitened means of many families in these tough times (the argument goes), that's like snatching away a lifeline when it's most needed.
"That's pretty nasty," says John Ulzheimer of credit.com, who appears ubiquitously on personal finance shows. The higher rates "make it harder for people to afford their existing balances," he says, and the lower limits can damage cardholders' credit scores, which get marked down when their balances come too close to their limits.
The real scandal, according to the common refrain, is that issuers such as American Express, Citigroup and Bank of America have received billions of bailout dollars from taxpayers. How dare they repay the favor by putting the squeeze on us?
This is where populism shades into demagoguery. Critics who argue that it's inappropriate for bailed-out banks to tighten credit terms on taxpayers have it exactly wrong: If we're footing the bill, we should praise these banks for being stingy with credit, not hammer them for it. It won't be any easier for them to pay us back if we hector them into maintaining the loose standards that produced this mess.
According to the latest data from Fitch Ratings, late payments on credit cards reached a record in February, with delinquencies close behind. The sad fact is that rising unemployment produces credit stress. Under the circumstances, tightening credit standards seems like a judicious precaution.
What about the claim that the issuers are perversely cutting limits for their highest-scoring, or safest, customers? It's true but misleading. Fair Isaac Corp., which invented the FICO score, found that of the 16% of consumers whose limits were cut between last April and October, two-thirds weren't guilty of any late payment or other "risk trigger."
Most of the reductions were applied to inactive or rarely utilized cards. This makes sense, because banks have to keep a reserve against the full amount of cardholders' credit limits. Why tie up capital for credit that isn't being used?
Fair Isaac says such reductions seldom produce real constraints on the consumers -- or any significant lowering of their scores. The computers and humans implementing these reductions aren't perfect, so many holders will undoubtedly feel they've been treated unjustly. (I imagine I'll hear from a few.) But the study suggests that most of the cutbacks are defensible.
Another sin laid to the card companies is charging sky-high interest rates. We know one reason for this: A 1978 Supreme Court decision enabled issuers to stick the highest rate permitted in their home states down the throats of customers nationwide -- that's why banks locate their credit card arms in jerkwater states without usury limits, like South Dakota.
But what's a "reasonable" annual rate? Who's to say that 25% is out of line for an uncollateralized balance owed by, say, someone holding six maxed-out Visa cards? (There's a customer for whom credit should not be cheap.) The banks are surely serious when they say that a federal rate cap, if set too low, would result in more Americans being refused any credit at
all.
In considering the card issuers' behavior, we need to focus on and fix what they really do wrong. Make them comply with clearly written customer contracts, yes. Make them offer cheap and copious credit to all just because their past mistakes have led to a taxpayer bailout, no.
The card companies stand accused by Congress and the Federal Reserve of gouging customers with impenetrable fees, enticing innocents to borrow themselves into bankruptcy, and blowing off cardholders who try to correct errors in their accounts.
Attacking these firms is a crowd-pleasing sport for lawmakers, in part because every constituent has a story about being mulcted by a card issuer. Last week the House of Representatives easily passed a credit card holders’ bill of rights. The Senate will take up a similar measure soon. President Obama has signaled his approval.
Someone has to stand up for these companies. I guess it'll have to be me.
Before I try to inject some perspective into the debate about card issuers, I'll stipulate that they've been guilty of genuinely sleazy behavior -- much of which is properly targeted by the measures in Washington.
They shouldn't be allowed to jack up the interest rate on card balances retroactively, except in rare cases. They should apply your payments to balances with the highest rates first. They shouldn't accept charges that put you over your credit limit and trigger a fee, if you request such a hard cap.
And they should be barred from marketing directly to young persons. Cards used to be hard to get if you had no credit history. But I could wallpaper my house with the come-ons that now come addressed to my college-age kids, a practice the banks must have learned from cigarette companies handing out free smokes at rock concerts.
But we routinely berate card issuers for actions that are actually prudent and wise. Certain purported sins, such as raising rates and cutting credit limits for some borrowers, merely ratchet back the loose standards that helped lead us to economic perdition. For years we cursed the banks for showering Americans with easy credit. Now we curse them for tightening up.
Because of their unsavory past, the issuers are unable to make this case for themselves. They remind me of some frat guys at my college who were guilty of only about half the things they were accused of, but what was true was bad enough. From them I learned this tenet of the court of public opinion: Once you've been caught firing guns at African American students from the frat house roof, no one will believe you're innocent of anything.
Still, it's proper to take an unemotional look at the rest of the prosecution brief against credit card companies.
One frequent complaint is that issuers arbitrarily jack up interest rates and slash credit limits even on customers with pristine records. Given the straitened means of many families in these tough times (the argument goes), that's like snatching away a lifeline when it's most needed.
"That's pretty nasty," says John Ulzheimer of credit.com, who appears ubiquitously on personal finance shows. The higher rates "make it harder for people to afford their existing balances," he says, and the lower limits can damage cardholders' credit scores, which get marked down when their balances come too close to their limits.
The real scandal, according to the common refrain, is that issuers such as American Express, Citigroup and Bank of America have received billions of bailout dollars from taxpayers. How dare they repay the favor by putting the squeeze on us?
This is where populism shades into demagoguery. Critics who argue that it's inappropriate for bailed-out banks to tighten credit terms on taxpayers have it exactly wrong: If we're footing the bill, we should praise these banks for being stingy with credit, not hammer them for it. It won't be any easier for them to pay us back if we hector them into maintaining the loose standards that produced this mess.
According to the latest data from Fitch Ratings, late payments on credit cards reached a record in February, with delinquencies close behind. The sad fact is that rising unemployment produces credit stress. Under the circumstances, tightening credit standards seems like a judicious precaution.
What about the claim that the issuers are perversely cutting limits for their highest-scoring, or safest, customers? It's true but misleading. Fair Isaac Corp., which invented the FICO score, found that of the 16% of consumers whose limits were cut between last April and October, two-thirds weren't guilty of any late payment or other "risk trigger."
Most of the reductions were applied to inactive or rarely utilized cards. This makes sense, because banks have to keep a reserve against the full amount of cardholders' credit limits. Why tie up capital for credit that isn't being used?
Fair Isaac says such reductions seldom produce real constraints on the consumers -- or any significant lowering of their scores. The computers and humans implementing these reductions aren't perfect, so many holders will undoubtedly feel they've been treated unjustly. (I imagine I'll hear from a few.) But the study suggests that most of the cutbacks are defensible.
Another sin laid to the card companies is charging sky-high interest rates. We know one reason for this: A 1978 Supreme Court decision enabled issuers to stick the highest rate permitted in their home states down the throats of customers nationwide -- that's why banks locate their credit card arms in jerkwater states without usury limits, like South Dakota.
But what's a "reasonable" annual rate? Who's to say that 25% is out of line for an uncollateralized balance owed by, say, someone holding six maxed-out Visa cards? (There's a customer for whom credit should not be cheap.) The banks are surely serious when they say that a federal rate cap, if set too low, would result in more Americans being refused any credit at
all.
In considering the card issuers' behavior, we need to focus on and fix what they really do wrong. Make them comply with clearly written customer contracts, yes. Make them offer cheap and copious credit to all just because their past mistakes have led to a taxpayer bailout, no.
Apple and Google Ties Investigated
The Federal Trade Commission has begun an inquiry into whether the close ties among the boards of two of technology’s most prominent companies, Apple and Google, amounts to a violation of antitrust laws, according to several people briefed on the inquiry.
Apple and Google share two directors, Eric E. Schmidt, the chief executive of Google, and Arthur Levinson, the former chief executive of Genentech. The Clayton Antitrust Act of 1914 prohibits a person’s presence on the board of two rival companies when it would reduce competition between them.
Antitrust experts say the "interlocking directorates" provision, known as Section 8 of the act, is rarely enforced. Nevertheless, the agency has already notified Google and Apple of its interest in the matter, according to the people briefed on the inquiry, who agreed to speak on condition of anonymity because the inquiry was confidential.
F.T.C. officials declined to comment. Spokespeople for Apple and Google also declined to comment. A spokesman for Genentech declined to make Mr. Levinson available for comment.
The inquiry, which appears to be in its early stages, is the second antitrust examination involving Google to have surfaced in recent days. It suggests that despite the company’s closeness to the Obama administration, Google will not escape scrutiny from regulators.
Mr. Schmidt campaigned for then-Senator Barack Obama during his presidential campaign and had advised the transition team and the administration on various matters. He was recently appointed to President Obama’s Council of Advisors on Science and Technology
Christine A. Varney, who was recently confirmed as the head of the antitrust division of the Justice Department, last year singled out Google as a likely source of antitrust concerns because of its near monopoly on Internet search and advertising.
Some antitrust experts said they do not expect Google’s ties to the Obama administration to play a role in antitrust issues.
“I expect the administration to be aggressive, generally, on antitrust enforcement,” said Sanford Litvack, a partner at Hogan & Hartson. Last year, while working for the Justice Department, Mr. Litvack built a case to block a high-profile advertising partnership between Google and Yahoo. “I don’t expect Google to either be singled out or to receive a free pass because of Schmidt’s relationship with the administration,” he said.
Experts say the "interlocking directorates" provision rarely lead to major confrontations between companies and the government. Executives typically choose to resign from the board of a competitor if it poses a problem rather than face a lengthy investigation or a bruising legal fight.
Like many companies in the technology industry, Google and Apple are both allies and competitors. Google, for instance, worked with Apple to design early versions of some its services, like Gmail and Google Maps, for Apple’s iPhone. William Campbell, an Apple board member, was an important, behind-the-scenes adviser to Google.
But the areas in which the companies are bumping up against each other as rivals have been increasing.
Mobile phones, in particular, loom large in the future of both Google and Apple. Much of Apple’s fortunes these days are tied to the success of the iPhone. Google, for its part, has said repeatedly that one of its biggest strategic opportunities is to expand its online advertising empire into mobile phones.
While Google benefits from the success of the iPhone, which drives more traffic to its mobile services than any other device, it also makes the Android operating system for mobile phones that compete with the iPhone. The system currently powers the T-Mobile G1, a phone that some analysts say is the most capable of a number of iPhone rivals.
Other phone manufacturers are planning to roll out devices powered by Android later this year. And the Android operating system is being built into lightweight portable computers known as netbooks, which may compete with some Apple laptops.
Google and Apple compete in a variety of other areas. Apple makes the Safari Web browser while Google makes the competing Chrome. Apple’s iTunes and Google’s YouTube are increasingly competing as venues for distribution of music and videos. And the two companies have photo-editing services.
It is not clear whether regulators have singled out any of these areas of competition as particularly troubling.
“Government actions under Section 8 are rare, but they are brought under circumstances when the presence of a common director on competing boards is likely to be anticompetitive,” said Andrew I. Gavil, an antitrust expert and a professor at Howard University School of Law.
Both Google and Apple share a rival in Microsoft, which competes with the two companies in a variety of areas. But Professor Gavil said regulators were not likely to see that as a problem, even if the two Silicon Valley companies were discussing ways to compete more effectively with Microsoft.
“Section 8 exists when you have a common director facilitating collusion so two companies coordinate their competitive strategies,” he said. “It is not clear that two companies figuring out a strategy to compete against a big common rival is anticompetitive or pro-competitive.”
Mr. Schmidt joined the board of Apple in August 2006, about five months before the company unveiled the iPhone. Google’s plans for Android, its mobile phone operating system were made public nearly a year later.
Since then, analysts and journalists have speculated that Mr. Schmidt’s position on Apple board would eventually become untenable. Google has said Mr. Schmidt typically recuses himself when Apple’s directors discuss mobile phones.
It is not clear why the agency is looking into the matter now. Some antitrust experts say, however, that the Obama administration may be more aggressive in enforcing antitrust laws. The Justice Department recently began an inquiry into the antitrust implications of a settlement of a class action brought by authors and publishers against Google.
“Clearly with the new administration, there is renewed enthusiasm for antitrust enforcement,” Samuel Miller, a partner at Sidley Austin in San Francisco, who acted as a special trial counsel in Justice Department’s first antitrust case against Microsoft.
Under the Clayton Act, interlocking directorates are not considered a problem if the revenue from products in which the companies compete is less than 2 percent of either company’s sales. Some antitrust experts say it may be hard for regulators to determine the revenue that Google earns from various products. Android, for instance, is free, but Google earns advertising revenue when users of an Android phone click on an ad
Apple and Google share two directors, Eric E. Schmidt, the chief executive of Google, and Arthur Levinson, the former chief executive of Genentech. The Clayton Antitrust Act of 1914 prohibits a person’s presence on the board of two rival companies when it would reduce competition between them.
Antitrust experts say the "interlocking directorates" provision, known as Section 8 of the act, is rarely enforced. Nevertheless, the agency has already notified Google and Apple of its interest in the matter, according to the people briefed on the inquiry, who agreed to speak on condition of anonymity because the inquiry was confidential.
F.T.C. officials declined to comment. Spokespeople for Apple and Google also declined to comment. A spokesman for Genentech declined to make Mr. Levinson available for comment.
The inquiry, which appears to be in its early stages, is the second antitrust examination involving Google to have surfaced in recent days. It suggests that despite the company’s closeness to the Obama administration, Google will not escape scrutiny from regulators.
Mr. Schmidt campaigned for then-Senator Barack Obama during his presidential campaign and had advised the transition team and the administration on various matters. He was recently appointed to President Obama’s Council of Advisors on Science and Technology
Christine A. Varney, who was recently confirmed as the head of the antitrust division of the Justice Department, last year singled out Google as a likely source of antitrust concerns because of its near monopoly on Internet search and advertising.
Some antitrust experts said they do not expect Google’s ties to the Obama administration to play a role in antitrust issues.
“I expect the administration to be aggressive, generally, on antitrust enforcement,” said Sanford Litvack, a partner at Hogan & Hartson. Last year, while working for the Justice Department, Mr. Litvack built a case to block a high-profile advertising partnership between Google and Yahoo. “I don’t expect Google to either be singled out or to receive a free pass because of Schmidt’s relationship with the administration,” he said.
Experts say the "interlocking directorates" provision rarely lead to major confrontations between companies and the government. Executives typically choose to resign from the board of a competitor if it poses a problem rather than face a lengthy investigation or a bruising legal fight.
Like many companies in the technology industry, Google and Apple are both allies and competitors. Google, for instance, worked with Apple to design early versions of some its services, like Gmail and Google Maps, for Apple’s iPhone. William Campbell, an Apple board member, was an important, behind-the-scenes adviser to Google.
But the areas in which the companies are bumping up against each other as rivals have been increasing.
Mobile phones, in particular, loom large in the future of both Google and Apple. Much of Apple’s fortunes these days are tied to the success of the iPhone. Google, for its part, has said repeatedly that one of its biggest strategic opportunities is to expand its online advertising empire into mobile phones.
While Google benefits from the success of the iPhone, which drives more traffic to its mobile services than any other device, it also makes the Android operating system for mobile phones that compete with the iPhone. The system currently powers the T-Mobile G1, a phone that some analysts say is the most capable of a number of iPhone rivals.
Other phone manufacturers are planning to roll out devices powered by Android later this year. And the Android operating system is being built into lightweight portable computers known as netbooks, which may compete with some Apple laptops.
Google and Apple compete in a variety of other areas. Apple makes the Safari Web browser while Google makes the competing Chrome. Apple’s iTunes and Google’s YouTube are increasingly competing as venues for distribution of music and videos. And the two companies have photo-editing services.
It is not clear whether regulators have singled out any of these areas of competition as particularly troubling.
“Government actions under Section 8 are rare, but they are brought under circumstances when the presence of a common director on competing boards is likely to be anticompetitive,” said Andrew I. Gavil, an antitrust expert and a professor at Howard University School of Law.
Both Google and Apple share a rival in Microsoft, which competes with the two companies in a variety of areas. But Professor Gavil said regulators were not likely to see that as a problem, even if the two Silicon Valley companies were discussing ways to compete more effectively with Microsoft.
“Section 8 exists when you have a common director facilitating collusion so two companies coordinate their competitive strategies,” he said. “It is not clear that two companies figuring out a strategy to compete against a big common rival is anticompetitive or pro-competitive.”
Mr. Schmidt joined the board of Apple in August 2006, about five months before the company unveiled the iPhone. Google’s plans for Android, its mobile phone operating system were made public nearly a year later.
Since then, analysts and journalists have speculated that Mr. Schmidt’s position on Apple board would eventually become untenable. Google has said Mr. Schmidt typically recuses himself when Apple’s directors discuss mobile phones.
It is not clear why the agency is looking into the matter now. Some antitrust experts say, however, that the Obama administration may be more aggressive in enforcing antitrust laws. The Justice Department recently began an inquiry into the antitrust implications of a settlement of a class action brought by authors and publishers against Google.
“Clearly with the new administration, there is renewed enthusiasm for antitrust enforcement,” Samuel Miller, a partner at Sidley Austin in San Francisco, who acted as a special trial counsel in Justice Department’s first antitrust case against Microsoft.
Under the Clayton Act, interlocking directorates are not considered a problem if the revenue from products in which the companies compete is less than 2 percent of either company’s sales. Some antitrust experts say it may be hard for regulators to determine the revenue that Google earns from various products. Android, for instance, is free, but Google earns advertising revenue when users of an Android phone click on an ad
Porous Border With Pakistan Could Hinder U.S. Troops
President Obama is pouring more than 20,000 new troops into Afghanistan this year for a fighting season that the United States military has called a make-or-break test of the allied campaign in Afghanistan.
But if Taliban strategists have their way, those forces will face a stiff challenge, not least because of one distinct Taliban advantage: the border between Afghanistan and Pakistan barely exists for the Taliban, who are counting on the fact that American forces cannot reach them in their sanctuaries in Pakistan.
One Pakistani logistics tactician for the Taliban, a 28-year-old from the country’s tribal areas, in interviews with The New York Times, described a Taliban strategy that relied on free movement over the border and in and around Pakistan, ready recruitment of Pakistani men and sustained cooperation of sympathetic Afghan villagers.
His account provided a keyhole view of the opponent the Americans and their NATO allies are up against, as well as the workings and ambitions of the Taliban as they prepared to meet the influx of American troops.
It also illustrated how the Pakistani Taliban, an umbrella group of many brands of jihadist fighters backed by Al Qaeda, are spearheading wars on both sides of the border in what for them is a seamless conflict.
The tactician wears a thick but carefully shaped black beard and a well-trimmed shock of black hair, a look cultivated to allow him to move easily all over Pakistan. He spoke on the condition of anonymity for fear of retribution by his fellow Taliban members.
But on an array of issues, discussed over six months of interviews with The Times, he has shown himself to be knowledgeable of Taliban activities, and the information he provided has matched up consistently with that of other sources.
He was well informed — and unconcerned, he said — of the plans of the head of the United States Central Command, Gen. David H. Petraeus, to replicate in Afghanistan some of the techniques he had used in Iraq to stop the Sunni tribes from fighting the Americans.
“I know of the Petraeus experiment there,” he said. “But we know our Afghans. They will take the money from Petraeus, but they will not be on his side. There are so many people working with the Afghans and the Americans who are on their payroll, but they inform us, sell us weapons.”
He acknowledged that the Americans would have far superior forces and power this year, but was confident that the Taliban could turn this advantage on its head. “The Americans cannot take control of the villages,” he said. “In order to expel us they will have to resort to aerial bombing, and then they will have more civilian casualties.”
The one thing that impressed him were the missile strikes by drones — virtually the only American military presence felt inside Pakistan. “The drones are very effective,” he said, acknowledging that they had thinned the top leadership of Al Qaeda and the Taliban in the area. He said 29 of his friends had been killed in the strikes.
The drone attacks simply prompted Taliban fighters to spend more time in Afghanistan, or to move deeper into Pakistan, straddling both theaters of a widening conflict. The recruits were prepared to fight where they were needed, in either country, he said.
In the fighting now under way in Buner and Dir Districts, in the North-West Frontier Province of Pakistan, the Pakistani Taliban are taking on the Pakistani Army in a battle that is the most obvious front of a long-haul strategy to destabilize and take over a nuclear-armed Pakistan.
In Afghanistan, the Pakistani Taliban are directly singling out the United States and NATO forces by sending guerrillas to assist their Afghan Taliban allies in ousting the foreigners from Afghanistan.
While to the Taliban those conflicts are one fluid and sprawling war, the border between Afghanistan and Pakistan has long presented a firm barrier for the United States.
Although Pakistan is an official ally of the United States, the Pakistanis will not allow American troops to cross the border from Afghanistan. They will also not allow the troops to be present as a fighting force alongside the Pakistani military in the tribal areas that Al Qaeda and the Taliban use as a base.
The United States has helped Pakistan and Afghanistan recently open a series of joint posts to share intelligence and improve border monitoring. But those efforts are slight when compared with the demands of a 1,600-mile frontier of unforgiving terrain.
Despite years of demands by American and NATO commanders for Pakistan to control Taliban infiltration, the Taliban tactician said getting his fighters over the border was not a problem. The Pakistani paramilitary soldiers from the Frontier Corps who guard the border were too busy looking after their own survival, he said.
He has already begun moving 80 Taliban fighters in four groups stealthily into Afghanistan in the past month to meet the new American forces, he said.
The tactician says he embeds his men in what he described as friendly Afghan villages, where they will spend the next four to six months with the residents, who provide the weapons and succor for the missions against American and NATO soldiers.
In March, he made a reconnaissance trip by motorcycle to Paktika Province in Afghanistan from Wana, the main city in South Waziristan, in Pakistan’s tribal areas, to make sure the route was safe for his men. It was.
He recently received news by cellphone that one group, his third, had safely arrived in Ghazni Province in Afghanistan. A fourth group was scheduled to leave shortly for Afghanistan, he said.
The main task for his first two groups of fighters will be to ambush convoys of NATO goods and soldiers on the Kandahar-Kabul highway, a major supply line for the allied war effort. “We want to inflict maximum trouble, to lower their morale, to destabilize,” he said.
His guerrillas, in their late teens to mid-20s, are handpicked for their endurance and commitment, he said. Some, like him, were trained by the Pakistani government as proxy fighters against India in Kashmir and have now joined the Qaeda and Taliban cause.
In a new twist, cameramen instructed to capture video of faltering American soldiers for propaganda DVDs are increasingly accompanying the guerrillas.
The tactician, a heavily built man who says he has put on weight in the past two years and is now too heavy and old to fight, said he was loyal to a commander named Mullah Mansoor.
In turn, Mr. Mansoor serves under the aegis of Siraj Haqqani, the son of a veteran Afghan mujahedeen leader, Jalaluddin Haqqani.
The tactician worked mostly from Wana, where he owns a small business and where, he acknowledged, the American drone strikes had disrupted life.
One of his close friends, a Taliban commander, Waheed Ullah, was killed Nov. 7 in a drone attack, he said. In Wana, the threat of the drones had ended the custom of gathering in groups of 10 to 20 men to discuss the issues of the day. “The gossip has finished,” he said.
The relationship between the Pakistani Taliban and Qaeda operatives, most of whom are Arabs, is respectful but distant, according to his descriptions.
The Arabs often go to the bazaar in Wana. But they bristle when asked questions, he said. “They never tell us their activities,” he said. “They take it very badly when you ask questions.”
But the Taliban are willing providers for Al Qaeda, he said. “When they need a suicide bomber, like blowing up a government building, we provide it,” he said.
There was respect for the scale of Al Qaeda’s ambitions. “They have a global agenda, they have a big design,” he said.
The Taliban goal was more narrow. “Capturing Afghanistan is not an Al Qaeda mission,” he said. “It’s a Taliban mission. We will be content in capturing Afghanistan and throwing the Americans out.”
The Pakistani Taliban will fight as long as it takes to defeat the Americans, he said. At the end of this fighting season, he said, “We will have a body count, and we will see who has broken whose back.”
But if Taliban strategists have their way, those forces will face a stiff challenge, not least because of one distinct Taliban advantage: the border between Afghanistan and Pakistan barely exists for the Taliban, who are counting on the fact that American forces cannot reach them in their sanctuaries in Pakistan.
One Pakistani logistics tactician for the Taliban, a 28-year-old from the country’s tribal areas, in interviews with The New York Times, described a Taliban strategy that relied on free movement over the border and in and around Pakistan, ready recruitment of Pakistani men and sustained cooperation of sympathetic Afghan villagers.
His account provided a keyhole view of the opponent the Americans and their NATO allies are up against, as well as the workings and ambitions of the Taliban as they prepared to meet the influx of American troops.
It also illustrated how the Pakistani Taliban, an umbrella group of many brands of jihadist fighters backed by Al Qaeda, are spearheading wars on both sides of the border in what for them is a seamless conflict.
The tactician wears a thick but carefully shaped black beard and a well-trimmed shock of black hair, a look cultivated to allow him to move easily all over Pakistan. He spoke on the condition of anonymity for fear of retribution by his fellow Taliban members.
But on an array of issues, discussed over six months of interviews with The Times, he has shown himself to be knowledgeable of Taliban activities, and the information he provided has matched up consistently with that of other sources.
He was well informed — and unconcerned, he said — of the plans of the head of the United States Central Command, Gen. David H. Petraeus, to replicate in Afghanistan some of the techniques he had used in Iraq to stop the Sunni tribes from fighting the Americans.
“I know of the Petraeus experiment there,” he said. “But we know our Afghans. They will take the money from Petraeus, but they will not be on his side. There are so many people working with the Afghans and the Americans who are on their payroll, but they inform us, sell us weapons.”
He acknowledged that the Americans would have far superior forces and power this year, but was confident that the Taliban could turn this advantage on its head. “The Americans cannot take control of the villages,” he said. “In order to expel us they will have to resort to aerial bombing, and then they will have more civilian casualties.”
The one thing that impressed him were the missile strikes by drones — virtually the only American military presence felt inside Pakistan. “The drones are very effective,” he said, acknowledging that they had thinned the top leadership of Al Qaeda and the Taliban in the area. He said 29 of his friends had been killed in the strikes.
The drone attacks simply prompted Taliban fighters to spend more time in Afghanistan, or to move deeper into Pakistan, straddling both theaters of a widening conflict. The recruits were prepared to fight where they were needed, in either country, he said.
In the fighting now under way in Buner and Dir Districts, in the North-West Frontier Province of Pakistan, the Pakistani Taliban are taking on the Pakistani Army in a battle that is the most obvious front of a long-haul strategy to destabilize and take over a nuclear-armed Pakistan.
In Afghanistan, the Pakistani Taliban are directly singling out the United States and NATO forces by sending guerrillas to assist their Afghan Taliban allies in ousting the foreigners from Afghanistan.
While to the Taliban those conflicts are one fluid and sprawling war, the border between Afghanistan and Pakistan has long presented a firm barrier for the United States.
Although Pakistan is an official ally of the United States, the Pakistanis will not allow American troops to cross the border from Afghanistan. They will also not allow the troops to be present as a fighting force alongside the Pakistani military in the tribal areas that Al Qaeda and the Taliban use as a base.
The United States has helped Pakistan and Afghanistan recently open a series of joint posts to share intelligence and improve border monitoring. But those efforts are slight when compared with the demands of a 1,600-mile frontier of unforgiving terrain.
Despite years of demands by American and NATO commanders for Pakistan to control Taliban infiltration, the Taliban tactician said getting his fighters over the border was not a problem. The Pakistani paramilitary soldiers from the Frontier Corps who guard the border were too busy looking after their own survival, he said.
He has already begun moving 80 Taliban fighters in four groups stealthily into Afghanistan in the past month to meet the new American forces, he said.
The tactician says he embeds his men in what he described as friendly Afghan villages, where they will spend the next four to six months with the residents, who provide the weapons and succor for the missions against American and NATO soldiers.
In March, he made a reconnaissance trip by motorcycle to Paktika Province in Afghanistan from Wana, the main city in South Waziristan, in Pakistan’s tribal areas, to make sure the route was safe for his men. It was.
He recently received news by cellphone that one group, his third, had safely arrived in Ghazni Province in Afghanistan. A fourth group was scheduled to leave shortly for Afghanistan, he said.
The main task for his first two groups of fighters will be to ambush convoys of NATO goods and soldiers on the Kandahar-Kabul highway, a major supply line for the allied war effort. “We want to inflict maximum trouble, to lower their morale, to destabilize,” he said.
His guerrillas, in their late teens to mid-20s, are handpicked for their endurance and commitment, he said. Some, like him, were trained by the Pakistani government as proxy fighters against India in Kashmir and have now joined the Qaeda and Taliban cause.
In a new twist, cameramen instructed to capture video of faltering American soldiers for propaganda DVDs are increasingly accompanying the guerrillas.
The tactician, a heavily built man who says he has put on weight in the past two years and is now too heavy and old to fight, said he was loyal to a commander named Mullah Mansoor.
In turn, Mr. Mansoor serves under the aegis of Siraj Haqqani, the son of a veteran Afghan mujahedeen leader, Jalaluddin Haqqani.
The tactician worked mostly from Wana, where he owns a small business and where, he acknowledged, the American drone strikes had disrupted life.
One of his close friends, a Taliban commander, Waheed Ullah, was killed Nov. 7 in a drone attack, he said. In Wana, the threat of the drones had ended the custom of gathering in groups of 10 to 20 men to discuss the issues of the day. “The gossip has finished,” he said.
The relationship between the Pakistani Taliban and Qaeda operatives, most of whom are Arabs, is respectful but distant, according to his descriptions.
The Arabs often go to the bazaar in Wana. But they bristle when asked questions, he said. “They never tell us their activities,” he said. “They take it very badly when you ask questions.”
But the Taliban are willing providers for Al Qaeda, he said. “When they need a suicide bomber, like blowing up a government building, we provide it,” he said.
There was respect for the scale of Al Qaeda’s ambitions. “They have a global agenda, they have a big design,” he said.
The Taliban goal was more narrow. “Capturing Afghanistan is not an Al Qaeda mission,” he said. “It’s a Taliban mission. We will be content in capturing Afghanistan and throwing the Americans out.”
The Pakistani Taliban will fight as long as it takes to defeat the Americans, he said. At the end of this fighting season, he said, “We will have a body count, and we will see who has broken whose back.”
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