Pakistani Military Chief Issues Strongest Threat Yet

Pakistan's military chief says he'll order Pakistani forces to fight any American troops attempting another raid on its soil like the mission earlier this week that killed al-Qaida leader Osama bin Laden.

In his first public reaction to Monday’s assault, Gen. Ashfaq Kayani, the head of Pakistan’s powerful armed forces, demanded Washington withdraw many of the U.S. military personnel now stationed inside Pakistan and warned that any future raids into the country would prompt a far-reaching reevaluation of Islamabad’s ties with Washington.

It's an escalation of U.S.-Pakistani tensions that suggests the already troubled relationship between the erstwhile allies could be entering a dangerous new phase. Both governments traded public potshots over the American operation that killed bin Laden in his hideout—an enormous compound in an affluent suburb of Islamabad. The proximity of the mansion to Pakistan's equivalent of West Point has raised uncomfortable questions about what Pakistan knew regarding bin Laden and why he managed to remain undetected there for years.

But Kayani was having none of it. “Any similar action violating the sovereignty of Pakistan will warrant a review on the level of military/intelligence cooperation with the United States,” he said in a brief statement released by the Pakistani military press office.

Later at a press conference with Pakistani journalists, Kayani said he would order Pakistani forces to engage any U.S. troops who entered the country in pursuit of other wanted militants. The comments raised the grim possibility that American and Pakistani troops could one day find themselves engaging in open combat, something which seemed almost unthinkable even a few days ago.

Back in Washington, Democratic Rep. Howard Berman of California, the ranking member of the House Foreign Relations Committee, urged the Obama administration to reconsider its military assistance to Pakistan because of the discovery that bin Laden—the most wanted man in the world—spent the last five years living under the noses of thousands of Pakistani security personnel.

“I am writing to express my deep and ongoing concerns regarding the impact of U.S. security assistance to Pakistan—concerns that have been exacerbated by the discovery of Osama bin Laden’s lair in Abbottabad,” Berman wrote in a letter to Secretary of State Hillary Clinton. “Certain elements of the Pakistani defense and intelligence establishments continue to provide direct and indirect support to groups that directly threaten the United States, Afghanistan, and Pakistan’s own stability … Pakistan’s continued resistance to cooperate with the United States in counterterrorism bespeaks an overall regression in the relationship.”

Berman’s comments were particularly striking because the lawmaker has long been a strong advocate of increasing American assistance to Pakistan. Berman—along with Sen. John Kerry, D-Mass., and Sen. Richard Lugar, R-Ind.—was one of the primary authors of a 2009 bill that will provide $7.5 billion in non-military aid to Pakistan by 2014.

The cross-Atlantic sniping highlights one of the most worrisome aftereffects of Monday’s dramatic raid by highly-trained Navy SEALs. The commandos killed bin Laden and recovered a wide array of computers, DVDs, hard drives, and other data storage devices, all without suffering a single American casualty.

But the raid, which was launched without any Pakistani knowledge or permission, has added new strains to Washington’s relationship with Islamabad. The United States wants Pakistan to step up its intelligence sharing about other wanted militants, especially bin Laden’s probable successor Ayman al-Zawahiri, who is thought to be hiding in the country’s lawless border regions, and to take stronger military action against the insurgent safe havens along Pakistan’s porous border with Afghanistan. Pakistan has rebuffed those requests in the past and shows no signs of changing its behavior now.

American patience, however, appears to be rapidly running out. The United States launched the Monday raid against bin Laden’s compound without tipping off anyone inside the Pakistani government because of fears that information about the planned covert assault would leak to bin Laden and allow him to escape the strike.

“There was very little support, if any, across the government for bringing the Pakistanis into the fold,” a senior U.S. official said Wednesday. “They had tipped off targets in the past.”

Privately, several high-ranking American officials said this week they expected Pakistan to take high-profile steps in the near future to demonstrate its commitment to the counter-terror fight and assuage Washington’s fury over the fact that bin Laden's apparently been hiding in plain sight just outside the Pakistani capital.

Zawahiri, al-Qaida’s longtime No. 2, is now the primary American target inside Pakistan, and U.S. officials are studying what one official described as evidence of “communication between al-Qaida leaders,” which was found inside the compound, some of it handwritten. American officials believe that Pakistan knows more about Zawahiri’s whereabouts than it has previously let on, and Islamabad’s decision about whether to share that intelligence with the United States will help determine whether tensions between the two countries continue to escalate or begin to abate.

For the moment, Pakistan appears to have chosen confrontation over cooperation. Kayani’s appeals to Pakistani patriotism and mistrust of the U.S. were clearly meant to obscure the growing questions about whether elements of Pakistan’s government, military, or intelligence services knew bin Laden was in their country and were at least tacitly sheltering him.

Kayani’s assertive approach has paid off in the past, literally. Successive generations of Pakistani leaders have managed to wring tens of billions of dollars of aid out of Washington by alternately promising to help fight terrorism and suggesting that such assistance could be compromised if Washington didn’t fully respect Pakistani sovereignty. The U.S. has provided Islamabad with roughly $20 billion in military and non-military aid since 2001, and Washington—using a similar carrot-and-stick approach—has successfully pressured Islamabad on occasion by threatening to cut that assistance.

But the discovery of bin Laden’s safe haven within Pakistani borders now threatens to change the rules of the game. Washington is embroiled in a difficult war in Afghanistan that was launched in direct response to the deadliest terror attack in its history. The United States spent a decade hunting the man responsible for the strike, only to find him living comfortably in a modern home located close to the capitol of one of its nominal allies. The U.S.-Pakistani relationship is certain to be reevaluated, but it’s likely to be a furious Washington, not an aggrieved Islamabad, which pushes for the most far-reaching changes.

Pakistani Government Warns America

ISLAMABAD (AP) - Pakistan warned America Thursday of "disastrous consequences" if it carries out any more unauthorized raids against suspected terrorists like the one that killed Osama bin Laden.

However, the government in Islamabad stopped short of labeling Monday's helicopter raid on bin Laden's compound not far from the capital Islamabad as an illegal operation and insisted relations between Washington and Islamabad remain on course.

The army and the government have come under criticism domestically for allowing the country's sovereignty to be violated. Some critics have expressed doubts about government claims that it was not aware of the raid until after it was over.

Foreign Secretary Salman Bashir's remarks seemed to be aimed chiefly at addressing that criticism.

"The Pakistan security forces are neither incompetent nor negligent about their sacred duty to protect Pakistan," he told reporters. "There shall not be any doubt that any repetition of such an act will have disastrous consequences," he said.

Bashir repeated Pakistani claims that it did not know anything about the raid until it was too late to stop it. He said the army scrambled two F-16 fighter jets when it was aware that foreign helicopters were hovering over the city of Abbottabad, but they apparently did not get to the choppers on time.

American officials have said they didn't inform Pakistan in advance, fearing bin Laden could be tipped off.

Asked whether it was illegal, Bashir said only "that is for historians to judge."

The fact that bin Laden was hiding in a large house close to an army academy in a garrison town two hours drive from the capital has led to international allegations that sections of Pakistan's security forces may have been harboring bin Laden.

Pakistan has firmly denied those charges, but failed to explain how it did not know. Bashir said there were no plans for an investigation.

Some U.S. lawmakers have called for the Obama administration to stop giving aid to Pakistan. But the president and other top American officials have appeared more cautious, realizing that downgrading or severing ties with the country would be risky given the important role it will likely play in negotiating an end to the Afghan War.

Bashir said perceptions that Pakistan's ties with Islamabad were at rock bottom were untrue.

"We acknowledge the United States is an important friend," he said. "Basically Pakistan and U.S. relations are moving in the right direction."

US Forces Kill Osama bin Laden

Osama bin Laden, the mastermind behind the Sept. 11, 2001, terror attacks that killed thousands of Americans, was slain Sunday in his luxury hideout in Pakistan in a firefight with U.S. forces, ending a manhunt that spanned a frustrating decade.

"Justice has been done," President Barack Obama declared late Sunday as crowds formed outside the White House to celebrate. Many sang "The Star-Spangled Banner" and "We Are the Champions."

Hundreds more waved American flags at ground zero in New York — where the twin towers that once stood as symbols of American economic power were brought down by bin Laden's hijackers 10 years ago.

Bin Laden, 54, was killed after a gunbattle with Navy SEALs and CIA paramilitary forces at a compound in the city of Abbottabad. He was shot in the left eye, NBC News' Savannah Guthrie reported citing an unnamed U.S. official.

In a background briefing with journalists, U.S. officials suggested that Bin Laden opened fire on the American forces before he was killed.

DNA Tests

The special operations forces were on the ground for less than 40 minutes and the operation was watched in real-time by CIA director Leon Panetta and other intelligence officials in a conference room at CIA headquarters in Langley, Va., an official said on condition of anonymity.

The team returned to Afghanistan with bin Laden's body, U.S. officials said. NBC News reported that bin Laden was later buried at sea.

Islamic tradition calls for a body to be buried within 24 hours, but finding a country willing to accept the remains of the world's most wanted terrorist would have been difficult, a senior administration official said.

Two Obama administration officials told the Associated Press Monday that DNA evidence shows the body was bin Laden's, with 99.9 percent confidence.

Other U.S. officials said one of bin Laden's sons and two of his most trusted couriers also were killed, as was an unidentified woman who was used as a human shield.

'A kill operation'

Al Arabiya TV reported that two of bin Laden's wives and four of his children were also captured during the operation.

Speaking on the condition of anonymity, a senior U.S. security official told Reuters that Navy SEALs dropped by helicopter to the compound were under orders to not capture bin Laden.

"This was a kill operation," the official said.

Intelligence officials weren't certain that bin Laden would be at the site as there was "no smoking gun that put him there," NBC News reported. But Bin Laden was indeed holed up in a two-story house 100 yards from a Pakistani military academy when four helicopters carrying U.S. forces swooped in .

Bin Laden's guards opened fire on the commandos and his final hiding place was left in flames, witnesses said.

One of the choppers "inexplicably" stopped working during the operation and landed, sources told NBC News. The chopper was later destroyed by the U.S. team and the raid went forward.

U.S. officials said no Americans were hurt in the operation.

Abbottabad is home to three Pakistan army regiments and thousands of military personnel and is dotted with military buildings. BBC News described the army site as the country's equivalent to West Point.

The discovery that bin Laden was living in an army town in Pakistan raises pointed questions about how he managed to evade capture and even whether Pakistan's military and intelligence leadership knew of his whereabouts and sheltered him.

The news of bin Laden's death immediately raised concerns that reprisal attacks from al-Qaida and other Islamist extremist groups could follow soon.

"In the wake of this operation, there may be a heightened threat to the U.S. homeland," a U.S. official said. "The U.S. is taking every possible precaution. The State Department has sent advisories to embassies worldwide and has issued a travel ban for Pakistan."

Security ramped up in U.S.

Police in New York, site of the deadliest attack on Sept. 11, said they had already begun to "ramp up" security on their own.

Other local law enforcement agencies around the U.S. are adding extra security measures out of "an abundance of caution," according to the Port Authority of New York and New Jersey.

The agency said the extra police were not a response to a specific threat and facilities would operate normally.

In Los Angeles, police said they were stepping up intelligence monitoring and in Philadelphia, a lieutenant said police were checking mosques and synagogues every hour.

'Momentous achievement'

Charles Wolf of New York, whose wife, Katherine, died on Sept, 11, 2001, rejoiced at the news, which he called "wonderful."

"I am really glad that man's evil is off this earth forever," Wolf said. "I am just very glad that they got him."

Former President George W. Bush said in a statement that he had personally been informed by Obama of the death of the terrorist leader whose attacks forever defined his eight years in office.

"This momentous achievement marks a victory for America, for people who seek peace around the world, and for all those who lost loved ones on September 11, 2001," the former president said.

"The fight against terror goes on, but tonight America has sent an unmistakable message: No matter how long it takes, justice will be done."

Obama echoed his predecessor, declaring that "the death of bin Laden marks the most significant achievement to date in our nation's struggle to defeat al-Qaida."

But he stressed that the effort against the organization continues. Al-Qaida remains in existence as an organization, presumably under the leadership of Ayman al-Zawahiri, 59, an Egyptian physician who is widely believed to have been bin Laden's No. 2.

"We must and we will remain vigilant at home and abroad," Obama said, while emphasizing that "the United States is not and never will be at war with Islam."

Secretary of State Hillary Rodham Clinton said Monday the killing of bin Laden is not the end of the war on terrorism and warned the network's members that the U.S. would be relentless in its pursuit of them.

Turning to deliver a direct message to bin Laden's followers, she vowed: "You cannot wait us out. You cannot defeat us but you can make the choice to abandon al-Qaida and participate in a peaceful political process."

'Affluent suburb'

Officials had long believed that bin Laden was hiding a mountainous region along the Pakistan-Afghanistan border. In August, U.S. intelligence officials got a tip on his whereabouts, which led to the operation that culminated Sunday, Obama said.

By mid-February, information developed that made U.S. officials confident that the information was sound.

In mid-March, Obama headed five National Security Council meetings on the subject. Friday morning, he gave the final order to carry out the attack on a compound in what was described as an "affluent suburb" of Islamabad.

"The bottom line of our collection and analysis was that we had high confidence that the compound held a high-value terrorist target," a senior official said, with a "strong probability" that it was bin Laden.

"It is also noteworthy that the property is valued at approximately $1 million but has no telephone or Internet service connected to it," an administration official added.

Bin Laden's compound was huge and "extraordinarily unique," about eight times larger than other homes in the area, U.S. officials said.

Few windows of the three-story home faced the outside of the compound, and other intense security measures included 12- to 18-foot outer walls topped with barbed wire and internal walls that sectioned off different parts of the compound, officials said.

They said the compound was isolated by 12-foot walls, with access restricted by two security gates. Residents in the compound burned their trash, rather than leaving it for collection as did their neighbors, officials said.

The sound of at least two explosions rocked Abbottabad as the fighting raged.

"After midnight, a large number of commandos encircled the compound. Three helicopters were hovering overhead. All of a sudden there was firing toward the helicopters from the ground," said Nasir Khan, a resident of the town.

"There was intense firing and then I saw one of the helicopters crash," said Khan, who had watched the dramatic scene unfold from his rooftop.

Resident Sahibzada Salahuddin said he was asleep when explosions woke him.

"I was sleeping when all of a sudden there was a blast. It was followed by two more small blasts ... I opened the door and saw the entire compound was on fire," he said.

The role of Pakistan, with which Washington has had a difficult relationship for years, remained unclear. A senior Pakistani intelligence official told NBC News that Pakistani special forces took part in the operation, but senior U.S. and Pakistani officials said Pakistan was not informed of the attack in advance.

Pakistan's first official statement about the operation Monday said the death of bin Laden showed the resolve of Pakistan and the world to battle terrorism, and that it was "a major setback to terrorist organizations around the world."

"This operation was conducted by the U.S. forces in accordance with declared U.S. policy that Osama bin Laden will be eliminated in a direct action by the U.S. forces, wherever found in the world," the statement from Pakistan's foreign ministry statement said.

Critics have long accused elements of Pakistan's security establishment of protecting bin Laden, though Islamabad has always denied this.

Earlier, a senior adviser to Pakistani President Asif Ali Zardari told NBC News that the politician was expected to make an "extremely positive" statement later Monday because bin Laden was "an enemy of the Pakistani people."

Afghanistan's President Hamid Karzai, meanwhile, argued that the strike proved the real fight against terrorists was outside his country's borders.

"For years we have said that the fight against terrorism is not in Afghan villages and houses," Karzai said. "It is in safe havens, and today that was shown to be true."

He offered his appreciation to international and Afghan forces who have lost their lives in the nearly 10-year war in Afghanistan and expressed hope that bin Laden's death could mean the end of terrorism. But he said now is the time to stop assaults that endanger or harass Afghan civilians.

Karzai pledged, however, that Afghanistan stands ready to do its part to help fight terrorists and extremists.

"We are with you and we are your allies," he said, noting that many Afghans had died because of bin Laden's terror network.

'I'm completely numb'

Reaction to the news of bin Laden's death was swift.

Bonnie McEneaney, 57, whose husband, Eamon, died in the 9/11 attacks, said the death of bin Laden was "long overdue."

"It doesn't bring back all the wonderful people who were killed 10 years ago," McEneaney told msnbc.com by phone from her home in New Canaan, Conn.

"I'm completely numb. I'm stunned," she said.

"The first thought I had in my mind was that it didn't bring my son back," Jack Lynch, who lost his son, New York City firefighter Michael Francis Lynch, on Sept. 11, 2001, told msnbc.com.

"You cut the head off a snake, you'd think it would kill the snake. But someone will take his place," Lynch said. "But people like him still exist. The fact that he's gone is not going to stop terrorism."

Lynch, 75, is a retired transit worker. His family's charity, the Michael Lynch Memorial Foundation, has made grants to send dozens of students to college. He said he would not celebrate bin Laden's death.

"I understand that bin Laden was an evil person. He may have believed in what he was doing. I'm not going to judge him," Lynch said. "I'm sure some people will look at this and they'll be gratified that he's dead, but me personally, I'm going to leave his fate in God's hands."

U.S. officials who have been entrenched in the battle against al-Qaida for years were more jubilant.

Sen. John McCain, R-Ariz., Obama's opponent in the 2008 election, said he was "overjoyed that we finally got the world's top terrorist."

"The world is a better and more just place now that Osama bin Laden is no longer in it," McCain said in a statement. "I hope the families of the victims of the September 11 attacks will sleep easier tonight and every night hence knowing that justice has been done."

Fed Says Recovery is Moderate: Stimulus Will End in June

Federal Reserve policy makers said the economy is recovering at a “moderate pace” and a pickup in inflation is likely to be temporary, as they agreed to finish $600 billion of bond purchases on schedule in June.

“The economic recovery is proceeding at a moderate pace and overall conditions in the labor market are improving gradually,” the Federal Open Market Committee said today in its statement after a two-day meeting in Washington. “Increases in the prices of energy and other commodities have pushed up inflation in recent months,” and the Fed expects “these effects to be transitory,” the statement said.

Chairman Ben S. Bernanke has signaled he’ll maintain record stimulus until job growth accelerates and the recovery is robust enough to withstand tighter credit. The Fed chief has said he expects that a surge this year in fuel and food costs will have only a passing inflationary impact, differing with Fed regional bank presidents who say borrowing costs may need to rise to contain prices.

Stocks rose and the dollar weakened after the statement. The Dow Jones Industrial Average advanced 0.3 percent to 12,636.62 at 1:33 p.m. in New York. The dollar fell to $1.4706 per euro from $1.4644 late yesterday.

‘Prepared to Adjust’
The Fed, discussing its securities portfolio, said it “is prepared to adjust those holdings as needed to best foster maximum employment and price stability.” Bernanke will discuss the FOMC statement and the panel’s updated economic projections today at his first news conference, scheduled to begin at 2:15 p.m. in Washington.

The FOMC’s characterization of the recovery as “moderate” is similar to the description in the Fed’s Beige Book regional business survey this month and compares with the committee’s March 15 statement saying the economy is on a “firmer footing.”

“The Fed’s view of the world hasn’t changed very much,” Gary Stern, former president of the Minneapolis Fed, said in an interview with Bloomberg Radio. “They continue to emphasize the transitory nature of inflation” and “continue to talk about the economy improving at a moderate pace.”

The Fed left its benchmark interest rate in a range of zero to 0.25 percent, where it’s been since December 2008, and retained a pledge in place since March 2009 to keep it “exceptionally low” for an “extended period.” The central bank will keep reinvesting proceeds of maturing mortgage debt purchased in the first round of large-scale asset purchases that lasted from December 2008 to March 2010.

Unemployment ‘Elevated’
“The unemployment rate remains elevated, and measures of underlying inflation continue to be somewhat low, relative to levels that the Committee judges to be consistent, over the longer run, with its dual mandate” for stable prices and maximum employment, the Fed said. The “depressed” housing industry remains a weak spot in the economy, it said.

The Fed repeated that it will “pay close attention to the evolution of inflation and inflation expectations.”

Bond markets share the Fed’s assessment that inflation will be transitory. Traders expect inflation, as measured by the difference between Treasury Inflation Protected Securities and nominal bonds, to be 2.62 percent over the next two years and then moderate to 2.39 percent over the next five years.

Today’s FOMC decision was unanimous for a third consecutive meeting. Dallas Fed President Richard Fisher and Philadelphia Fed President Charles Plosser, both skeptics of the second round of so-called quantitative easing who voted for the statement today, have suggested they may favor raising interest rates later this year.

Record Stimulus
The Fed’s commitment to record stimulus contrasts with the interest-rate increase this month by the European Central Bank and tightening this year by the biggest emerging-market economies, including China, Brazil and India, which face faster inflation.

Bernanke will become the first Fed chairman to conduct a press briefing following an FOMC decision when he takes the microphone at the Fed’s headquarters. His counterparts in Europe, Japan, the U.K. and Canada already hold regular news conferences.

The press conference, to be broadcast on television and the central bank’s website, marks one of Bernanke’s biggest efforts to improve the Fed’s connections with the public and demystify the institution, which as recently as 1993 didn’t announce its monetary-policy decisions. Bernanke said in February that the central bank was weighing benefits of more transparency against the risk that his remarks would trigger unwanted fluctuations in financial markets.

Projections
The Fed will also release economic projections of governors and regional bank presidents at 2:15 p.m., three weeks sooner than prior practice.

Increases in employment and inflation are helping drive calls to tighten credit. Payrolls have increased by an average 149,000 a month for the past six months, while the unemployment rate has dropped by 1 percentage point since November to 8.8 percent, a two-year low.

Federal Reserve Bank of New York President William C. Dudley, the FOMC’s vice chairman, reiterated in a speech April 1 that a faster pace of job growth is “sorely needed” and that even with 300,000 new jobs per month, the labor market would still have “considerable slack” at the end of 2012.

Janet Yellen, vice chairman of the Fed’s Board of Governors, said April 11 that the increase in food and fuel costs will have only a temporary impact on prices and consumer spending, and warrants no reversal of monetary stimulus.

Food Prices
Food and beverage prices rose in the first quarter by the most since 2008, based on the Labor Department’s Consumer Price Index, while the cost of regular-unleaded gasoline has increased by 26 percent this year to $3.88 a gallon as of yesterday.

The increases helped slow U.S. growth to a 2 percent pace in the first quarter, according to the median estimate of analysts surveyed by Bloomberg News, from 3.1 percent in the prior period. The government releases preliminary figures tomorrow.

The Fed’s preferred price gauge hasn’t flashed a warning. The Commerce Department’s personal consumption expenditures price index, excluding food and energy, rose 0.9 percent in February from a year earlier. Policy makers have a long-run goal for total inflation of about 1.6 percent to 2 percent annually.

Months Away
Economists say the Fed is at least a few months away from starting to reverse the stimulus. Most of the 44 economists surveyed by Bloomberg News from April 20 to April 25 said the central bank this year will probably halt its policy of replacing maturing mortgage debt with Treasuries. The majority of respondents also said the Fed will announce a plan next year of selling mortgage bonds and Treasuries among its assets.

Since the Fed announced the second round of asset purchases on Nov. 3, yields on 10-year Treasuries increased to 3.31 percent as of yesterday from 2.57 percent, while the Standard & Poor’s 500 Index gained 12 percent, yesterday reaching the highest level since June 2008. The dollar weakened by 3.5 percent to the lowest since August 2008 against an index of six currencies.

In a few months, “the data will probably compel them to begin a gradual process of tightening,” Larry Hatheway, chief economist for UBS Investment Bank in London, said in a Bloomberg Television interview before the decision.

“The Fed is still looking essentially at ex-food, ex- energy prices at core, ticking a little higher,” though not enough to raise interest rates now, Hatheway said.

Politicians’ Objections
Bernanke is still seeing objections from politicians within the U.S. and abroad almost six months after the Fed began the unprecedented second round of asset purchases to criticism from Republican politicians and government officials in Germany, China and Brazil.

Senator Mark Kirk, a first-term Republican from Illinois, sent Bernanke a letter on April 25 expressing concern about inflation. He called for an early end to asset purchases should Bernanke “also find the trends that I have now heard widely about.”

Russian Prime Minister Vladimir Putin said last week that compared with the U.S., his country doesn’t have the “same opportunity to make trouble.” The U.S. is “financing the government by using a printing press,” he said.

Some U.S. companies are benefiting from global growth. Atlanta-based United Parcel Service Inc., the world’s largest package-delivery company, yesterday raised its full-year profit forecast after increased international shipping demand pushed first-quarter earnings higher than analysts estimated.

Sporting Goods
Firms are also coping with inflation. Beaverton, Oregon- based Nike Inc., the world’s biggest sporting goods company, said last month it would raise prices. The increases will come on a “wide range of footwear and apparel styles to help mitigate the overall impact of higher input costs,” and the company will carry out “more significant price increases” in 2012, Chief Financial Officer Don Blair said March 17.

Today marked the first time the Fed’s statement was released at about 12:30 p.m. after more than a decade of aiming for 2:15 p.m. The central bank said last month it will provide the statement at 12:30 p.m. during the four two-day meetings when Bernanke has his press conferences and 2:15 p.m. for the other four one-day FOMC meetings.

White House Releases Birth Certificate

The White House has released President Obama's long-form birth certificate, saying the document is "proof positive" the president was born in Hawaii.

The release marked an unexpected turn in the long-simmering, though widely discredited, controversy over Obama's origin. Obama's advisers have for the better part of three years dismissed questions about the president's birth, directing skeptics to the short-term document released during the 2008 campaign. But as the issue gained more attention at the state level and particularly in the 2012 presidential race, Obama said Wednesday that it was starting to distract attention from pressing challenges like the budget.

The president, who discussed the release at the White House without taking questions, said he had been "puzzled" by the enduring shelf life of the issue and acknowledged the announcement may not put the so-called birther controversy to rest. But he told the public and the media that it's time to "get serious."

"We do not have time for this kind of silliness," Obama said. "We've got better stuff to do. I've got better stuff to do. We've got big problems to solve."

He said the country will not solve those problems if people are "distracted by sideshows and carnival barkers."

The document released by the White House lists Obama's birthplace as Honolulu, Hawaii, and his birth date as Aug. 4, 1961. The hospital listed is Kapiolani Maternity & Gynecological Hospital. The name on the birth certificate is Barack Hussein Obama II.

Obama's presidential campaign, in response to questions raised in 2008, at the time posted a short-form version of the document on the Internet. But conspiracy theories continued to fester. They gained legs in recent weeks as Donald Trump, who is toying with the possibility of running as a presidential candidate in 2012, repeatedly and publicly questioned Obama's origin.

White House Communications Director Dan Pfeiffer noted that what started as Internet chatter had moved into the national political debate and ended up being discussed regularly on mainstream news outlets.

Pfeiffer, on the White House blog, said the president thought the attention was "bad for the American people" and directed his counsel to request access to the long-form document from the Hawaii State Department of Health. The department granted an exception to release the long-form document "because of the tremendous volume of requests they had been getting," the White House said.

"At a time of great consequence for this country -- when we should be debating how we win the future, reduce our deficit, deal with high gas prices, and bring stability to the Middle East, Washington, D.C., was once again distracted by a fake issue," Pfeiffer said on the blog. "The president's hope is that with this step, we can move on to debating the bigger issues that matter to the American people and the future of the country."

Trump, speaking in New Hampshire, took credit Wednesday for the president's decision to release the document. He said his team would have to examine the birth certificate and questioned why the White House took so long, but indicated he wanted to move beyond the issue.

"Today, I'm very proud of myself, because I've accomplished something that nobody else has been able to accomplish," Trump told reporters. "Why he didn't do it when everybody else was asking for it, I don't know. But I am really honored, frankly, to have played such a big role in hopefully, hopefully getting rid of this issue."

The document states that Obama's father, Barack Hussein Obama, was born in Kenya and that his mother, Stanley Ann Dunham, was born in Kansas.

* How long will it take before someone claims it's a fake?

GOP Raises Debt Ceiling

One day after being named to a presidential task force to negotiate deficit reduction, House Majority Leader Eric Cantor fired off a stark warning to Democrats that the GOP “will not grant their request for a debt limit increase” without major spending cuts or budget process reforms.

The Virginia Republican’s missive is a clear escalation in the long-running Washington spending war, with no less than the full faith and credit of the United States hanging in the balance.

In the most recent budget battle — over a six-month spending bill — Republican leaders carefully avoided threatening to shut down the government. Now, Cantor says he’s ready to plunge the nation into default if the GOP’s demands are not met. People close to Cantor say that he hopes to make clear that small concessions from Democrats, including President Barack Obama, will not be enough to deliver the GOP on a debt increase.

Democrats were quick to punch back.

“Congress will not permit the nation to default on its obligations because it would be beyond irresponsible to do so,” said Brian Fallon, a spokesman for Sen. Charles E. Schumer (D-N.Y.), in a statement to POLITICO. “Leader Cantor knows this, and should heed the many business leaders who are telling Republicans to stop playing games with the debt ceiling to gain political leverage.”

Republicans are floating a wide range of major structural reforms that could be attached to the debt limit vote, including statutory spending caps, a balanced budget amendment and a two-thirds vote requirement for tax increases and debt limit increases. Liberals want a “clean” vote to raise the $14.3 trillion borrowing limit.

Those in the center simply hope to find an accord that will prevent the nation from defaulting on its obligations and sending global markets into a tailspin.

The Treasury Department estimates the country will hit the debt ceiling between mid-May and July 8, and Democrats say it’s no time to play chicken with the standing of the nation’s credit — which has taken a hit already this week with Standard and Poor changing its outlook on U.S. debt from “stable” to “negative.”

“Mr. Cantor believes he has found political leverage in mixing the retroactive debt ceiling debate with the forward looking debt reduction debate. What he is willing to risk for this so-called leverage is a mid-air stall in America’s fledging economic recovery and the tarnishing of the full faith and credit of the United States of America,” said Vermont Rep. Peter Welch, who is leading House Democrats in demanding a “clean” vote. “America pays its bills. It always has and it always will. Holding that solemn tradition hostage in a game of kamikaze budget politics is reckless, irresponsible and playing with fire.”


Republican leaders have said all along that the public won’t stand for a debt-limit increase that doesn’t include spending reforms, but Cantor’s comments Wednesday suggest a deeper line in the sand. And the term “serious” reforms suggests Republicans may want a stronger long-term spending agreements in place before they schedule a debt limit vote.

It’s a tricky issue that divides the parties from traditional allies.

The Chamber of Commerce, which typically aligns with Republicans, has been working hard to ensure that the debt limit is increased, and the Washington Post’s editorial page, a traditional voice for liberals, argued on Wednesday morning that deficit-reduction measures must be attached to any debt-limit increase.

Aside from his post in leadership, Cantor’s remark carries additional significance because he is the House Republican representative on a White House panel slated to examine the nation’s deficit in the months leading up to the debt ceiling increase. The Virginia Republican also warned that the panel, led by Vice President Joesph R. Biden and composed of members of Congress, needs “a clearly defined mission and a targeted purpose to be accomplished within a specific and binding timeframe.”

It sets the stage for an incredibly tricky political dance in the next few weeks between Senate Democrats, the White House and House Republicans over an issue that could shake international markets and the fragile economic recovery.

House Speaker John Boehner’s office played down any difference in degree between Cantor’s remarks and those made in the past by Boehner, a Republican from Ohio. Boehner has said the “American people will not stand” for a debt ceiling increase “unless it is accompanied by serious action to reduce our deficit.”

And in a statement issued to POLITICO before Cantor’s release on Wednesday, Boehner spokesman Michael Steel said “The President has asked us to raise the debt ceiling, but the American people won’t tolerate an increase if we don’t begin to address the problem of ever-higher spending and debt. House Republicans are listening, and we will insist on real spending cuts and reforms in this debate.”

Congressional Republicans have still yet to coalesce around which spending cuts or process overhauls they’ll seek as an attachment to the debt-ceiling vote. Lawmakers are out of town for a two-week recess, slated to return the first week in May.

But several options are being bandied about in GOP circles.

One possibility that has gained some traction among Republicans is statutory spending caps to both mandatory and discretionary spending.

Cantor has casually floated a proposed amendment to the Constitution, originally written by Sen. Mike Lee (R-Utah), that would require the budget to be balanced by prohibiting spending from outstripping revenue in any year without a two-thirds vote of each chamber of Congress.


It would also require two-thirds votes for tax increases and debt-limit increases, as well as capping federal spending at 18 percent of the nation’s gross domestic product.

Sen. Bob Corker’s (R-Tenn.) “CAP Act” proposal is also a popular alternative among Republicans and Democrats in both the Senate and House. It sets a cap on all spending, aiming to bring outlays down to roughly 20 percent of GDP. It also mandates that the Office of Management and Budget make cuts throughout the federal budget if Congress is unable to get spending down the mandated level.

House Republicans may try to attach elements of their recently passed budget to a debt-limit package. Block-granting Medicaid to states is one proposal that has gotten strong support in GOP circles and among a handful of Democratic officials at the state level.

Several GOP sources said Republicans could also move to limit the growth of federal bureaucracy by capping the federal workforce — a plan sure to be derided by Democrats as an instant job-crusher.

At this rate, the debt ceiling will be the all-consuming battle going into the summer, and it provides the GOP what they’ve dubbed as another bite of the apple – essentially another opportunity to cut spending and reform how Washington spends money.

The debt ceiling has been raised 74 times since 1962. In most cases, debt-limit increases have been tied to other bills in an effort to ensure support for both measures. For example, the Democrats’ stimulus law in the last Congress raised the debt ceiling, as did several budget resolutions passed in the past few decades.

House Republicans are also trying to frame the debt ceiling increase as belonging to Obama: They say that if he wants to raise it he has to sell it to the American people. Democrats – in the House, Senate and White House — seem to have accepted the fact that the debt ceiling will almost certainly need to be coupled with other spending control measures.

But they are far from agreement with Republicans on the specifics.

As Republicans flex their muscles on the upcoming vote, House Majority Whip Steny Hoyer of Maryland is seizing on a promise in the GOP’s 2010 “Pledge to America” to “advance major legislation one issue at a time” to scold Republicans.

“I think that to hold hostage the full faith and credit of the United States of America to another agenda item is wrong. In fact, the Republicans pledged that they would not do that,” Hoyer said. “And, in fact, they said, and Mr. Boehner has said, that he would keep separate divisive issues from important bills and he would take them up individually. That is what ought to be done here.”

iPhone Tracking Your Movement

Privacy concerns raised as researchers find that iPhone saves every detail of users' movements without their knowledge


Researchers have discovered secret files on the iPhone that track user location and store it on the device, without the user's knowledge.

The log file was discovered by the University of Exeter senior research fellow in astronomy Alasdair Allan and writer Pete Warden.

The revelation has raised privacy concerns as the data that is stored is unencrypted and could easily be read by anyone having access to the phone. It could also be misused by someone if the phone is stolen.

"Apple has made it possible for almost anybody - a jealous spouse, a private detective - with access to your phone or computer to get detailed information about where you've been," said Warden.

The pair of data scientists also added Apple could not have placed the software accidently as the log file tranfers onto new devices when an old one is replaced.

They said, "Apple might have new features in mind that require a history of your location, but that's our specualtion. The fact that [the file] is transferred across [to a new iPhone or iPad] when you migrate is evidence that the data-gathering isn't accidental."

However, Allan and Warden say they have no evidence that the data is collected by Apple or anybody else.

The secret file in the smartphone contains the latitude and longitude along with a timestamp of the location of the phone. Allan and Warden created a tool which shows the data in the form of a visual map.

The researchers said the movement tracking software is exclusive to Apple's iPhones. They could not find it in Google's Android phones.

"Alasdair has looked for similar tracking code in Android phones and couldn't find any," said Warden.

"We haven't come across any instances of other phone manufacturers doing this."