Cairo, Eqypt

I am honored to be in the timeless city of Cairo, and to be hosted by two remarkable institutions. For over a thousand years, Al-Azhar has stood as a beacon of Islamic learning, and for over a century, Cairo University has been a source of Egypt’s advancement. Together, you represent the harmony between tradition and progress. I am grateful for your hospitality, and the hospitality of the people of Egypt. I am also proud to carry with me the goodwill of the American people, and a greeting of peace from Muslim communities in my country: assalaamu alaykum.

We meet at a time of tension between the United States and Muslims around the world – tension rooted in historical forces that go beyond any current policy debate. The relationship between Islam and the West includes centuries of co-existence and cooperation, but also conflict and religious wars. More recently, tension has been fed by colonialism that denied rights and opportunities to many Muslims, and a Cold War in which Muslim-majority countries were too often treated as proxies without regard to their own aspirations. Moreover, the sweeping change brought by modernity and globalization led many Muslims to view the West as hostile to the traditions of Islam.

Violent extremists have exploited these tensions in a small but potent minority of Muslims. The attacks of September 11th, 2001 and the continued efforts of these extremists to engage in violence against civilians has led some in my country to view Islam as inevitably hostile not only to America and Western countries, but also to human rights. This has bred more fear and mistrust.

So long as our relationship is defined by our differences, we will empower those who sow hatred rather than peace, and who promote conflict rather than the cooperation that can help all of our people achieve justice and prosperity. This cycle of suspicion and discord must end.

I have come here to seek a new beginning between the United States and Muslims around the world; one based upon mutual interest and mutual respect; and one based upon the truth that America and Islam are not exclusive, and need not be in competition. Instead, they overlap, and share common principles – principles of justice and progress; tolerance and the dignity of all human beings.

Cairo University, Site of President Obama's Middle East Speech

I do so recognizing that change cannot happen overnight. No single speech can eradicate years of mistrust, nor can I answer in the time that I have all the complex questions that brought us to this point. But I am convinced that in order to move forward, we must say openly the things we hold in our hearts, and that too often are said only behind closed doors. There must be a sustained effort to listen to each other; to learn from each other; to respect one another; and to seek common ground. As the Holy Koran tells us, “Be conscious of God and speak always the truth.” That is what I will try to do – to speak the truth as best I can, humbled by the task before us, and firm in my belief that the interests we share as human beings are far more powerful than the forces that drive us apart.

Part of this conviction is rooted in my own experience. I am a Christian, but my father came from a Kenyan family that includes generations of Muslims. As a boy, I spent several years in Indonesia and heard the call of the azaan at the break of dawn and the fall of dusk. As a young man, I worked in Chicago communities where many found dignity and peace in their Muslim faith.

As a student of history, I also know civilization’s debt to Islam. It was Islam – at places like Al-Azhar University – that carried the light of learning through so many centuries, paving the way for Europe’s Renaissance and Enlightenment. It was innovation in Muslim communities that developed the order of algebra; our magnetic compass and tools of navigation; our mastery of pens and printing; our understanding of how disease spreads and how it can be healed. Islamic culture has given us majestic arches and soaring spires; timeless poetry and cherished music; elegant calligraphy and places of peaceful contemplation. And throughout history, Islam has demonstrated through words and deeds the possibilities of religious tolerance and racial equality.

I know, too, that Islam has always been a part of America’s story. The first nation to recognize my country was Morocco. In signing the Treaty of Tripoli in 1796, our second President John Adams wrote, “The United States has in itself no character of enmity against the laws, religion or tranquility of Muslims.” And since our founding, American Muslims have enriched the United States. They have fought in our wars, served in government, stood for civil rights, started businesses, taught at our Universities, excelled in our sports arenas, won Nobel Prizes, built our tallest building, and lit the Olympic Torch. And when the first Muslim-American was recently elected to Congress, he took the oath to defend our Constitution using the same Holy Koran that one of our Founding Fathers – Thomas Jefferson – kept in his personal library.

So I have known Islam on three continents before coming to the region where it was first revealed. That experience guides my conviction that partnership between America and Islam must be based on what Islam is, not what it isn’t. And I consider it part of my responsibility as President of the United States to fight against negative stereotypes of Islam wherever they appear.

But that same principle must apply to Muslim perceptions of America. Just as Muslims do not fit a crude stereotype, America is not the crude stereotype of a self-interested empire. The United States has been one of the greatest sources of progress that the world has ever known. We were born out of revolution against an empire. We were founded upon the ideal that all are created equal, and we have shed blood and struggled for centuries to give meaning to those words – within our borders, and around the world. We are shaped by every culture, drawn from every end of the Earth, and dedicated to a simple concept: E pluribus unum: “Out of many, one.”

Much has been made of the fact that an African-American with the name Barack Hussein Obama could be elected President. But my personal story is not so unique. The dream of opportunity for all people has not come true for everyone in America, but its promise exists for all who come to our shores – that includes nearly seven million American Muslims in our country today who enjoy incomes and education that are higher than average.

Moreover, freedom in America is indivisible from the freedom to practice one’s religion. That is why there is a mosque in every state of our union, and over 1,200 mosques within our borders. That is why the U.S. government has gone to court to protect the right of women and girls to wear the hijab, and to punish those who would deny it.

So let there be no doubt: Islam is a part of America. And I believe that America holds within her the truth that regardless of race, religion, or station in life, all of us share common aspirations – to live in peace and security; to get an education and to work with dignity; to love our families, our communities, and our God. These things we share. This is the hope of all humanity.

Of course, recognizing our common humanity is only the beginning of our task. Words alone cannot meet the needs of our people. These needs will be met only if we act boldly in the years ahead; and if we understand that the challenges we face are shared, and our failure to meet them will hurt us all.

For we have learned from recent experience that when a financial system weakens in one country, prosperity is hurt everywhere. When a new flu infects one human being, all are at risk. When one nation pursues a nuclear weapon, the risk of nuclear attack rises for all nations. When violent extremists operate in one stretch of mountains, people are endangered across an ocean. And when innocents in Bosnia and Darfur are slaughtered, that is a stain on our collective conscience. That is what it means to share this world in the 21st century. That is the responsibility we have to one another as human beings.

This is a difficult responsibility to embrace. For human history has often been a record of nations and tribes subjugating one another to serve their own interests. Yet in this new age, such attitudes are self-defeating. Given our interdependence, any world order that elevates one nation or group of people over another will inevitably fail. So whatever we think of the past, we must not be prisoners of it. Our problems must be dealt with through partnership; progress must be shared.

That does not mean we should ignore sources of tension. Indeed, it suggests the opposite: we must face these tensions squarely. And so in that spirit, let me speak as clearly and plainly as I can about some specific issues that I believe we must finally confront together.

The first issue that we have to confront is violent extremism in all of its forms.

In Ankara, I made clear that America is not – and never will be – at war with Islam. We will, however, relentlessly confront violent extremists who pose a grave threat to our security. Because we reject the same thing that people of all faiths reject: the killing of innocent men, women, and children. And it is my first duty as President to protect the American people.

The situation in Afghanistan demonstrates America’s goals, and our need to work together. Over seven years ago, the United States pursued al Qaeda and the Taliban with broad international support. We did not go by choice, we went because of necessity. I am aware that some question or justify the events of 9/11. But let us be clear: al Qaeda killed nearly 3,000 people on that day. The victims were innocent men, women and children from America and many other nations who had done nothing to harm anybody. And yet Al Qaeda chose to ruthlessly murder these people, claimed credit for the attack, and even now states their determination to kill on a massive scale. They have affiliates in many countries and are trying to expand their reach. These are not opinions to be debated; these are facts to be dealt with.

Make no mistake: we do not want to keep our troops in Afghanistan. We seek no military bases there. It is agonizing for America to lose our young men and women. It is costly and politically difficult to continue this conflict. We would gladly bring every single one of our troops home if we could be confident that there were not violent extremists in Afghanistan and Pakistan determined to kill as many Americans as they possibly can. But that is not yet the case.

That’s why we’re partnering with a coalition of forty-six countries. And despite the costs involved, America’s commitment will not weaken. Indeed, none of us should tolerate these extremists. They have killed in many countries. They have killed people of different faiths – more than any other, they have killed Muslims. Their actions are irreconcilable with the rights of human beings, the progress of nations, and with Islam. The Holy Koran teaches that whoever kills an innocent, it is as if he has killed all mankind; and whoever saves a person, it is as if he has saved all mankind. The enduring faith of over a billion people is so much bigger than the narrow hatred of a few. Islam is not part of the problem in combating violent extremism – it is an important part of promoting peace.

We also know that military power alone is not going to solve the problems in Afghanistan and Pakistan. That is why we plan to invest $1.5 billion each year over the next five years to partner with Pakistanis to build schools and hospitals, roads and businesses, and hundreds of millions to help those who have been displaced. And that is why we are providing more than $2.8 billion to help Afghans develop their economy and deliver services that people depend upon.

Let me also address the issue of Iraq. Unlike Afghanistan, Iraq was a war of choice that provoked strong differences in my country and around the world. Although I believe that the Iraqi people are ultimately better off without the tyranny of Saddam Hussein, I also believe that events in Iraq have reminded America of the need to use diplomacy and build international consensus to resolve our problems whenever possible. Indeed, we can recall the words of Thomas Jefferson, who said: “I hope that our wisdom will grow with our power, and teach us that the less we use our power the greater it will be.”

Today, America has a dual responsibility: to help Iraq forge a better future – and to leave Iraq to Iraqis. I have made it clear to the Iraqi people that we pursue no bases, and no claim on their territory or resources. Iraq’s sovereignty is its own. That is why I ordered the removal of our combat brigades by next August. That is why we will honor our agreement with Iraq’s democratically-elected government to remove combat troops from Iraqi cities by July, and to remove all our troops from Iraq by 2012. We will help Iraq train its Security Forces and develop its economy. But we will support a secure and united Iraq as a partner, and never as a patron.

And finally, just as America can never tolerate violence by extremists, we must never alter our principles. 9/11 was an enormous trauma to our country. The fear and anger that it provoked was understandable, but in some cases, it led us to act contrary to our ideals. We are taking concrete actions to change course. I have unequivocally prohibited the use of torture by the United States, and I have ordered the prison at Guantanamo Bay closed by early next year.

So America will defend itself respectful of the sovereignty of nations and the rule of law. And we will do so in partnership with Muslim communities which are also threatened. The sooner the extremists are isolated and unwelcome in Muslim communities, the sooner we will all be safer.

The second major source of tension that we need to discuss is the situation between Israelis, Palestinians and the Arab world.

America’s strong bonds with Israel are well known. This bond is unbreakable. It is based upon cultural and historical ties, and the recognition that the aspiration for a Jewish homeland is rooted in a tragic history that cannot be denied.

Around the world, the Jewish people were persecuted for centuries, and anti-Semitism in Europe culminated in an unprecedented Holocaust. Tomorrow, I will visit Buchenwald, which was part of a network of camps where Jews were enslaved, tortured, shot and gassed to death by the Third Reich. Six million Jews were killed – more than the entire Jewish population of Israel today. Denying that fact is baseless, ignorant, and hateful. Threatening Israel with destruction – or repeating vile stereotypes about Jews – is deeply wrong, and only serves to evoke in the minds of Israelis this most painful of memories while preventing the peace that the people of this region deserve.

On the other hand, it is also undeniable that the Palestinian people – Muslims and Christians – have suffered in pursuit of a homeland. For more than sixty years they have endured the pain of dislocation. Many wait in refugee camps in the West Bank, Gaza, and neighboring lands for a life of peace and security that they have never been able to lead. They endure the daily humiliations – large and small – that come with occupation. So let there be no doubt: the situation for the Palestinian people is intolerable. America will not turn our backs on the legitimate Palestinian aspiration for dignity, opportunity, and a state of their own.

For decades, there has been a stalemate: two peoples with legitimate aspirations, each with a painful history that makes compromise elusive. It is easy to point fingers – for Palestinians to point to the displacement brought by Israel’s founding, and for Israelis to point to the constant hostility and attacks throughout its history from within its borders as well as beyond. But if we see this conflict only from one side or the other, then we will be blind to the truth: the only resolution is for the aspirations of both sides to be met through two states, where Israelis and Palestinians each live in peace and security.

That is in Israel’s interest, Palestine’s interest, America’s interest, and the world’s interest. That is why I intend to personally pursue this outcome with all the patience that the task requires. The obligations that the parties have agreed to under the Road Map are clear. For peace to come, it is time for them – and all of us – to live up to our responsibilities.

Palestinians must abandon violence. Resistance through violence and killing is wrong and does not succeed. For centuries, black people in America suffered the lash of the whip as slaves and the humiliation of segregation. But it was not violence that won full and equal rights. It was a peaceful and determined insistence upon the ideals at the center of America’s founding. This same story can be told by people from South Africa to South Asia; from Eastern Europe to Indonesia. It’s a story with a simple truth: that violence is a dead end. It is a sign of neither courage nor power to shoot rockets at sleeping children, or to blow up old women on a bus. That is not how moral authority is claimed; that is how it is surrendered.

Now is the time for Palestinians to focus on what they can build. The Palestinian Authority must develop its capacity to govern, with institutions that serve the needs of its people. Hamas does have support among some Palestinians, but they also have responsibilities. To play a role in fulfilling Palestinian aspirations, and to unify the Palestinian people, Hamas must put an end to violence, recognize past agreements, and recognize Israel’s right to exist.

At the same time, Israelis must acknowledge that just as Israel’s right to exist cannot be denied, neither can Palestine’s. The United States does not accept the legitimacy of continued Israeli settlements. This construction violates previous agreements and undermines efforts to achieve peace. It is time for these settlements to stop.

Israel must also live up to its obligations to ensure that Palestinians can live, and work, and develop their society. And just as it devastates Palestinian families, the continuing humanitarian crisis in Gaza does not serve Israel’s security; neither does the continuing lack of opportunity in the West Bank. Progress in the daily lives of the Palestinian people must be part of a road to peace, and Israel must take concrete steps to enable such progress.

Finally, the Arab States must recognize that the Arab Peace Initiative was an important beginning, but not the end of their responsibilities. The Arab-Israeli conflict should no longer be used to distract the people of Arab nations from other problems. Instead, it must be a cause for action to help the Palestinian people develop the institutions that will sustain their state; to recognize Israel’s legitimacy; and to choose progress over a self-defeating focus on the past.

America will align our policies with those who pursue peace, and say in public what we say in private to Israelis and Palestinians and Arabs. We cannot impose peace. But privately, many Muslims recognize that Israel will not go away. Likewise, many Israelis recognize the need for a Palestinian state. It is time for us to act on what everyone knows to be true.

Too many tears have flowed. Too much blood has been shed. All of us have a responsibility to work for the day when the mothers of Israelis and Palestinians can see their children grow up without fear; when the Holy Land of three great faiths is the place of peace that God intended it to be; when Jerusalem is a secure and lasting home for Jews and Christians and Muslims, and a place for all of the children of Abraham to mingle peacefully together as in the story of Isra, when Moses, Jesus, and Mohammed (peace be upon them) joined in prayer.

The third source of tension is our shared interest in the rights and responsibilities of nations on nuclear weapons.

This issue has been a source of tension between the United States and the Islamic Republic of Iran. For many years, Iran has defined itself in part by its opposition to my country, and there is indeed a tumultuous history between us. In the middle of the Cold War, the United States played a role in the overthrow of a democratically-elected Iranian government. Since the Islamic Revolution, Iran has played a role in acts of hostage-taking and violence against U.S. troops and civilians. This history is well known. Rather than remain trapped in the past, I have made it clear to Iran’s leaders and people that my country is prepared to move forward. The question, now, is not what Iran is against, but rather what future it wants to build.

It will be hard to overcome decades of mistrust, but we will proceed with courage, rectitude and resolve. There will be many issues to discuss between our two countries, and we are willing to move forward without preconditions on the basis of mutual respect. But it is clear to all concerned that when it comes to nuclear weapons, we have reached a decisive point. This is not simply about America’s interests. It is about preventing a nuclear arms race in the Middle East that could lead this region and the world down a hugely dangerous path.

I understand those who protest that some countries have weapons that others do not. No single nation should pick and choose which nations hold nuclear weapons. That is why I strongly reaffirmed America’s commitment to seek a world in which no nations hold nuclear weapons. And any nation – including Iran – should have the right to access peaceful nuclear power if it complies with its responsibilities under the nuclear Non-Proliferation Treaty. That commitment is at the core of the Treaty, and it must be kept for all who fully abide by it. And I am hopeful that all countries in the region can share in this goal.

The fourth issue that I will address is democracy.

I know there has been controversy about the promotion of democracy in recent years, and much of this controversy is connected to the war in Iraq. So let me be clear: no system of government can or should be imposed upon one nation by any other.

That does not lessen my commitment, however, to governments that reflect the will of the people. Each nation gives life to this principle in its own way, grounded in the traditions of its own people. America does not presume to know what is best for everyone, just as we would not presume to pick the outcome of a peaceful election. But I do have an unyielding belief that all people yearn for certain things: the ability to speak your mind and have a say in how you are governed; confidence in the rule of law and the equal administration of justice; government that is transparent and doesn’t steal from the people; the freedom to live as you choose. Those are not just American ideas, they are human rights, and that is why we will support them everywhere.

There is no straight line to realize this promise. But this much is clear: governments that protect these rights are ultimately more stable, successful and secure. Suppressing ideas never succeeds in making them go away. America respects the right of all peaceful and law-abiding voices to be heard around the world, even if we disagree with them. And we will welcome all elected, peaceful governments – provided they govern with respect for all their people.

This last point is important because there are some who advocate for democracy only when they are out of power; once in power, they are ruthless in suppressing the rights of others. No matter where it takes hold, government of the people and by the people sets a single standard for all who hold power: you must maintain your power through consent, not coercion; you must respect the rights of minorities, and participate with a spirit of tolerance and compromise; you must place the interests of your people and the legitimate workings of the political process above your party. Without these ingredients, elections alone do not make true democracy.

The fifth issue that we must address together is religious freedom.

Islam has a proud tradition of tolerance. We see it in the history of Andalusia and Cordoba during the Inquisition. I saw it firsthand as a child in Indonesia, where devout Christians worshiped freely in an overwhelmingly Muslim country. That is the spirit we need today. People in every country should be free to choose and live their faith based upon the persuasion of the mind, heart, and soul. This tolerance is essential for religion to thrive, but it is being challenged in many different ways.

Among some Muslims, there is a disturbing tendency to measure one’s own faith by the rejection of another’s. The richness of religious diversity must be upheld – whether it is for Maronites in Lebanon or the Copts in Egypt. And fault lines must be closed among Muslims as well, as the divisions between Sunni and Shia have led to tragic violence, particularly in Iraq.

Freedom of religion is central to the ability of peoples to live together. We must always examine the ways in which we protect it. For instance, in the United States, rules on charitable giving have made it harder for Muslims to fulfill their religious obligation. That is why I am committed to working with American Muslims to ensure that they can fulfill zakat.

Likewise, it is important for Western countries to avoid impeding Muslim citizens from practicing religion as they see fit – for instance, by dictating what clothes a Muslim woman should wear. We cannot disguise hostility towards any religion behind the pretence of liberalism.

Indeed, faith should bring us together. That is why we are forging service projects in America that bring together Christians, Muslims, and Jews. That is why we welcome efforts like Saudi Arabian King Abdullah’s Interfaith dialogue and Turkey’s leadership in the Alliance of Civilizations. Around the world, we can turn dialogue into Interfaith service, so bridges between peoples lead to action – whether it is combating malaria in Africa, or providing relief after a natural disaster.

The sixth issue that I want to address is women’s rights.

I know there is debate about this issue. I reject the view of some in the West that a woman who chooses to cover her hair is somehow less equal, but I do believe that a woman who is denied an education is denied equality. And it is no coincidence that countries where women are well-educated are far more likely to be prosperous.

Now let me be clear: issues of women’s equality are by no means simply an issue for Islam. In Turkey, Pakistan, Bangladesh and Indonesia, we have seen Muslim-majority countries elect a woman to lead. Meanwhile, the struggle for women’s equality continues in many aspects of American life, and in countries around the world.

Our daughters can contribute just as much to society as our sons, and our common prosperity will be advanced by allowing all humanity – men and women – to reach their full potential. I do not believe that women must make the same choices as men in order to be equal, and I respect those women who choose to live their lives in traditional roles. But it should be their choice. That is why the United States will partner with any Muslim-majority country to support expanded literacy for girls, and to help young women pursue employment through micro-financing that helps people live their dreams.

Finally, I want to discuss economic development and opportunity.

I know that for many, the face of globalization is contradictory. The Internet and television can bring knowledge and information, but also offensive sexuality and mindless violence. Trade can bring new wealth and opportunities, but also huge disruptions and changing communities. In all nations – including my own – this change can bring fear. Fear that because of modernity we will lose of control over our economic choices, our politics, and most importantly our identities – those things we most cherish about our communities, our families, our traditions, and our faith.

But I also know that human progress cannot be denied. There need not be contradiction between development and tradition. Countries like Japan and South Korea grew their economies while maintaining distinct cultures. The same is true for the astonishing progress within Muslim-majority countries from Kuala Lumpur to Dubai. In ancient times and in our times, Muslim communities have been at the forefront of innovation and education.

This is important because no development strategy can be based only upon what comes out of the ground, nor can it be sustained while young people are out of work. Many Gulf States have enjoyed great wealth as a consequence of oil, and some are beginning to focus it on broader development. But all of us must recognize that education and innovation will be the currency of the 21st century, and in too many Muslim communities there remains underinvestment in these areas. I am emphasizing such investments within my country. And while America in the past has focused on oil and gas in this part of the world, we now seek a broader engagement.

On education, we will expand exchange programs, and increase scholarships, like the one that brought my father to America, while encouraging more Americans to study in Muslim communities. And we will match promising Muslim students with internships in America; invest in on-line learning for teachers and children around the world; and create a new online network, so a teenager in Kansas can communicate instantly with a teenager in Cairo.

On economic development, we will create a new corps of business volunteers to partner with counterparts in Muslim-majority countries. And I will host a Summit on Entrepreneurship this year to identify how we can deepen ties between business leaders, foundations and social entrepreneurs in the United States and Muslim communities around the world.

On science and technology, we will launch a new fund to support technological development in Muslim-majority countries, and to help transfer ideas to the marketplace so they can create jobs. We will open centers of scientific excellence in Africa, the Middle East and Southeast Asia, and appoint new Science Envoys to collaborate on programs that develop new sources of energy, create green jobs, digitize records, clean water, and grow new crops. And today I am announcing a new global effort with the Organization of the Islamic Conference to eradicate polio. And we will also expand partnerships with Muslim communities to promote child and maternal health.

All these things must be done in partnership. Americans are ready to join with citizens and governments; community organizations, religious leaders, and businesses in Muslim communities around the world to help our people pursue a better life.

The issues that I have described will not be easy to address. But we have a responsibility to join together on behalf of the world we seek – a world where extremists no longer threaten our people, and American troops have come home; a world where Israelis and Palestinians are each secure in a state of their own, and nuclear energy is used for peaceful purposes; a world where governments serve their citizens, and the rights of all God’s children are respected. Those are mutual interests. That is the world we seek. But we can only achieve it together.

I know there are many – Muslim and non-Muslim – who question whether we can forge this new beginning. Some are eager to stoke the flames of division, and to stand in the way of progress. Some suggest that it isn’t worth the effort – that we are fated to disagree, and civilizations are doomed to clash. Many more are simply skeptical that real change can occur. There is so much fear, so much mistrust. But if we choose to be bound by the past, we will never move forward. And I want to particularly say this to young people of every faith, in every country – you, more than anyone, have the ability to remake this world.

All of us share this world for but a brief moment in time. The question is whether we spend that time focused on what pushes us apart, or whether we commit ourselves to an effort – a sustained effort – to find common ground, to focus on the future we seek for our children, and to respect the dignity of all human beings.

It is easier to start wars than to end them. It is easier to blame others than to look inward; to see what is different about someone than to find the things we share. But we should choose the right path, not just the easy path. There is also one rule that lies at the heart of every religion – that we do unto others as we would have them do unto us. This truth transcends nations and peoples – a belief that isn’t new; that isn’t black or white or brown; that isn’t Christian, or Muslim or Jew. It’s a belief that pulsed in the cradle of civilization, and that still beats in the heart of billions. It’s a faith in other people, and it’s what brought me here today.

We have the power to make the world we seek, but only if we have the courage to make a new beginning, keeping in mind what has been written.

The Holy Koran tells us, “O mankind! We have created you male and a female; and we have made you into nations and tribes so that you may know one another.”

The Talmud tells us: “The whole of the Torah is for the purpose of promoting peace.”

The Holy Bible tells us, “Blessed are the peacemakers, for they shall be called sons of God.”

The people of the world can live together in peace. We know that is God’s vision. Now, that must be our work here on Earth. Thank you. And may God’s peace be upon you.

Home Espresso Machine Reviews

Espresso machines in general are a 50/50 bet to work and function well. The more you spend, the better the chances will be that your espresso machine 1) works out of the box, or 2) works for more than a few months. The advice we can give to people in the market to replace an existing espresso machine or to buy their first one is to read the brand/model reviews and then to follow your gut. For instance, if you read nothing but rave reviews for an espresso machine that costs less than $100, be careful. The reviews could be written by company employees or friends. When you get to the models that cost between $100-$250, you still must be careful. Make sure there are plenty of reviews and read the ones that do not give high praise because those comments are the worst that can probably go wrong. Espresso machines that cost upwards of $250 are probably a safer bet but ensure that the frame of the structure is die-cast steel and not made of plastic. Futher, make sure all moving parts are steel and not plastic. Believe us, at some point, some plastic part will fail, break or fall off between year 1 and 2. You may justify paying for a cheaper model by calculating the savings in $3 coffee Starbucks that you will no longer have to pay for. That’s fair. If you want more convenience, less headaches and money savings, though, pay more for a better model. You will make your money back and then some.

Krups XP1500 Espresso Machine

Krups Espresso Machines

Our orginal espresso machine was a Krups model combination espresso and coffee machine, less than $200 and made of plastic. Even the moving parts, more specifically, the rotating knob that triggered the heat pot on the espresso side, was made of plastic. All worked well for about 1 1/2 years then the steamer broke despite careful daily attention to cleaning the spout and airhole. Every month, we would also run clean water through the machine just to cleanse it of potential harmful impurities (we used filtered water to brew our espressos). A few months later, the plastic rotating knob broke off and each day thereafter became a challenge in finding that right position for the knob to trigger the heat pot. Finally, it got too unwieldy and precious minutes, 5 minutes, 10 minutes, 15 minutes, would tick off before we could get it to work properly. However, for 2 years, we had the Krups espresso/coffee machine. We saved about $1,500 over those two years including the cost of coffee we would have purchased from Starbucks in the meanwhile and the cost of espresso beans needed for our espressos.

Breville Espresso Machines

This time around we paid $399 (on sale from $499) for a Breville 800ESXL die-cast steel espresso maker machine. All parts are steel. The only moving parts are the switch from espresso maker to steamer on the front face and the steamer. The plastic cover on the Krups espresso machine steamer broke off eventually. The Breville espresso maker’s brew head is elevated so larger coffee cups can fit underneath. The filter holder that fits into the brew head comes with 1 cup and 2 cup filters and a tamping spoon. Breville also provides a small steel handled pot in which milk can be steamed. Another nice convenience is that with one push of the button, the steamer becomes a hot water dispenser for hot chocolate, tea or any beverage that requries hot water. In addition, a large removable 2.3 quart (2.2 liter) water tank allows for almost continuous espresso making.

Breville 800ESXL Espresso Machine

We’ve only had the Breville espresso maker for a day but we read review after review. The espresso was delicious. We’ll see how the machine holds up over time. Based on the reviews, we should get more than 2 years out of it. We bought it from Macy’s but could have purchased it online. Macy’s covers replacements and maintenance for the first 6 months while Breville provides a one year warranty. In case of problems, we’d much prefer to return it to the store rather than experience the nuisance and inconvenience of shipping a product back to people we don’t know and will never see. Although it’s been a day, the point is that you get what you pay for. It seems that no matter what brand or price point we were comfortable meeting, we would save money because Starbucks lattes are so expensive. But, we really wanted to save more money and not deal with the inconvenience of breakable plastic parts. We’ll see how the Breville espresso maker does in these next few months.

My fellow citizens:

I stand here today humbled by the task before us, grateful for the trust you have bestowed, mindful of the sacrifices borne by our ancestors. I thank President Bush for his service to our nation, as well as the generosity and cooperation he has shown throughout this transition.

Forty-four Americans have now taken the presidential oath. The words have been spoken during rising tides of prosperity and the still waters of peace. Yet, every so often the oath is taken amidst gathering clouds and raging storms. At these moments, America has carried on not simply because of the skill or vision of those in high office, but because We the People have remained faithful to the ideals of our forbearers, and true to our founding documents.

So it has been. So it must be with this generation of Americans.

That we are in the midst of crisis is now well understood. Our nation is at war, against a far-reaching network of violence and hatred. Our economy is badly weakened, a consequence of greed and irresponsibility on the part of some, but also our collective failure to make hard choices and prepare the nation for a new age. Homes have been lost; jobs shed; businesses shuttered. Our health care is too costly; our schools fail too many; and each day brings further evidence that the ways we use energy strengthen our adversaries and threaten our planet.

These are the indicators of crisis, subject to data and statistics. Less measurable but no less profound is a sapping of confidence across our land - a nagging fear that America’s decline is inevitable, and that the next generation must lower its sights.

Today I say to you that the challenges we face are real. They are serious and they are many. They will not be met easily or in a short span of time. But know this, America - they will be met.

On this day, we gather because we have chosen hope over fear, unity of purpose over conflict and discord.

On this day, we come to proclaim an end to the petty grievances and false promises, the recriminations and worn out dogmas, that for far too long have strangled our politics.

We remain a young nation, but in the words of Scripture, the time has come to set aside childish things. The time has come to reaffirm our enduring spirit; to choose our better history; to carry forward that precious gift, that noble idea, passed on from generation to generation: the God-given promise that all are equal, all are free, and all deserve a chance to pursue their full measure of happiness.

In reaffirming the greatness of our nation, we understand that greatness is never a given. It must be earned. Our journey has never been one of short-cuts or settling for less. It has not been the path for the faint-hearted - for those who prefer leisure over work, or seek only the pleasures of riches and fame. Rather, it has been the risk-takers, the doers, the makers of things - some celebrated but more often men and women obscure in their labor, who have carried us up the long, rugged path towards prosperity and freedom.

For us, they packed up their few worldly possessions and traveled across oceans in search of a new life.

For us, they toiled in sweatshops and settled the West; endured the lash of the whip and plowed the hard earth.

For us, they fought and died, in places like Concord and Gettysburg; Normandy and Khe Sahn.

Time and again these men and women struggled and sacrificed and worked till their hands were raw so that we might live a better life. They saw America as bigger than the sum of our individual ambitions; greater than all the differences of birth or wealth or faction.

This is the journey we continue today. We remain the most prosperous, powerful nation on Earth. Our workers are no less productive than when this crisis began. Our minds are no less inventive, our goods and services no less needed than they were last week or last month or last year. Our capacity remains undiminished. But our time of standing pat, of protecting narrow interests and putting off unpleasant decisions - that time has surely passed. Starting today, we must pick ourselves up, dust ourselves off, and begin again the work of remaking America.

For everywhere we look, there is work to be done. The state of the economy calls for action, bold and swift, and we will act - not only to create new jobs, but to lay a new foundation for growth. We will build the roads and bridges, the electric grids and digital lines that feed our commerce and bind us together. We will restore science to its rightful place, and wield technology’s wonders to raise health care’s quality and lower its cost. We will harness the sun and the winds and the soil to fuel our cars and run our factories. And we will transform our schools and colleges and universities to meet the demands of a new age. All this we can do. And all this we will do.

Now, there are some who question the scale of our ambitions - who suggest that our system cannot tolerate too many big plans. Their memories are short. For they have forgotten what this country has already done; what free men and women can achieve when imagination is joined to common purpose, and necessity to courage.

What the cynics fail to understand is that the ground has shifted beneath them - that the stale political arguments that have consumed us for so long no longer apply. The question we ask today is not whether our government is too big or too small, but whether it works - whether it helps families find jobs at a decent wage, care they can afford, a retirement that is dignified. Where the answer is yes, we intend to move forward. Where the answer is no, programs will end. And those of us who manage the public’s dollars will be held to account - to spend wisely, reform bad habits, and do our business in the light of day - because only then can we restore the vital trust between a people and their government.
Nor is the question before us whether the market is a force for good or ill. Its power to generate wealth and expand freedom is unmatched, but this crisis has reminded us that without a watchful eye, the market can spin out of control - and that a nation cannot prosper long when it favors only the prosperous. The success of our economy has always depended not just on the size of our Gross Domestic Product, but on the reach of our prosperity; on the ability to extend opportunity to every willing heart - not out of charity, but because it is the surest route to our common good.

As for our common defense, we reject as false the choice between our safety and our ideals. Our Founding Fathers, faced with perils we can scarcely imagine, drafted a charter to assure the rule of law and the rights of man, a charter expanded by the blood of generations. Those ideals still light the world, and we will not give them up for expedience’s sake. And so to all other peoples and governments who are watching today, from the grandest capitals to the small village where my father was born: know that America is a friend of each nation and every man, woman, and child who seeks a future of peace and dignity, and we are ready to lead once more.

Recall that earlier generations faced down fascism and communism not just with missiles and tanks, but with the sturdy alliances and enduring convictions. They understood that our power alone cannot protect us, nor does it entitle us to do as we please. Instead, they knew that our power grows through its prudent use; our security emanates from the justness of our cause, the force of our example, the tempering qualities of humility and restraint.

We are the keepers of this legacy. Guided by these principles once more, we can meet those new threats that demand even greater effort - even greater cooperation and understanding between nations. We will begin to responsibly leave Iraq to its people, and forge a hard-earned peace in Afghanistan. With old friends and former foes, we’ll work tirelessly to lessen the nuclear threat, and roll back the specter of a warming planet. We will not apologize for our way of life, nor will we waver in its defense, and for those who seek to advance their aims by inducing terror and slaughtering innocents, we say to you now that our spirit is stronger and cannot be broken; you cannot outlast us, and we will defeat you.

For we know that our patchwork heritage is a strength, not a weakness. We are a nation of Christians and Muslims, Jews and Hindus - and non-believers. We are shaped by every language and culture, drawn from every end of this Earth; and because we have tasted the bitter swill of civil war and segregation, and emerged from that dark chapter stronger and more united, we cannot help but believe that the old hatreds shall someday pass; that the lines of tribe shall soon dissolve; that as the world grows smaller, our common humanity shall reveal itself; and that America must play its role in ushering in a new era of peace.

To the Muslim world, we seek a new way forward, based on mutual interest and mutual respect. To those leaders around the globe who seek to sow conflict, or blame their society’s ills on the West - know that your people will judge you on what you can build, not what you destroy. To those who cling to power through corruption and deceit and the silencing of dissent, know that you are on the wrong side of history; but that we will extend a hand if you are willing to unclench your fist.

To the people of poor nations, we pledge to work alongside you to make your farms flourish and let clean waters flow; to nourish starved bodies and feed hungry minds. And to those nations like ours that enjoy relative plenty, we say we can no longer afford indifference to the suffering outside our borders; nor can we consume the world’s resources without regard to effect. For the world has changed, and we must change with it.

As we consider the road that unfolds before us, we remember with humble gratitude those brave Americans who, at this very hour, patrol far-off deserts and distant mountains. They have something to tell us, just as the fallen heroes who lie in Arlington whisper through the ages. We honor them not only because they are guardians of our liberty, but because they embody the spirit of service; a willingness to find meaning in something greater than themselves. And yet, at this moment - a moment that will define a generation - it is precisely this spirit that must inhabit us all.

For as much as government can do and must do, it is ultimately the faith and determination of the American people upon which this nation relies. It is the kindness to take in a stranger when the levees break, the selflessness of workers who would rather cut their hours than see a friend lose their job which sees us through our darkest hours. It is the firefighter’s courage to storm a stairway filled with smoke, but also a parent’s willingness to nurture a child, that finally decides our fate.

Our challenges may be new. The instruments with which we meet them may be new. But those values upon which our success depends - honesty and hard work, courage and fair play, tolerance and curiosity, loyalty and patriotism - these things are old. These things are true. They have been the quiet force of progress throughout our history. What is demanded then is a return to these truths. What is required of us now is a new era of responsibility - a recognition, on the part of every American, that we have duties to ourselves, our nation, and the world, duties that we do not grudgingly accept but rather seize gladly, firm in the knowledge that there is nothing so satisfying to the spirit, so defining of our character, than giving our all to a difficult task.

This is the price and the promise of citizenship.

This is the source of our confidence - the knowledge that God calls on us to shape an uncertain destiny.

This is the meaning of our liberty and our creed - why men and women and children of every race and every faith can join in celebration across this magnificent mall, and why a man whose father less than sixty years ago might not have been served at a local restaurant can now stand before you to take a most sacred oath.

So let us mark this day with remembrance, of who we are and how far we have traveled. In the year of America’s birth, in the coldest of months, a small band of patriots huddled by dying campfires on the shores of an icy river. The capital was abandoned. The enemy was advancing. The snow was stained with blood. At a moment when the outcome of our revolution was most in doubt, the father of our nation ordered these words be read to the people:
“Let it be told to the future world…that in the depth of winter, when nothing but hope and virtue could survive…that the city and the country, alarmed at one common danger, came forth to meet [it].”

America. In the face of our common dangers, in this winter of our hardship, let us remember these timeless words. With hope and virtue, let us brave once more the icy currents, and endure what storms may come. Let it be said by our children’s children that when we were tested we refused to let this journey end, that we did not turn back nor did we falter; and with eyes fixed on the horizon and God’s grace upon us, we carried forth that great gift of freedom and delivered it safely to future generations.

Thank you. God bless you and God bless the United States of America.

The first four photographs of Celine Dion at The Staples Center on December 2, 2008 were taken with the LG Dare cellphone. The Taking Chances Tour set list sang at the Honda Center in Anaheim and at The Staples Center in Los Angeles is also posted.

Celine Dion Taking Chances Tour at Staples Center, December 2, 2008

I Drove All Night / The Power of Love / Taking Chances / It’s All Coming Back to Me Now > Because You Loved Me / To Love You More / Eyes on Me / All by Myself / I’m Alive / Shadow of Love / Fade Away / I’m Your Angel / Alone / Pour Que Tu M’Aimes Encore / My Love / The Prayer / Soul Medley (Sex Machine > Soul Man > Lady Marmalade > Respect > I Got the Feelin’) / It’s a Man’s, Man’s, Man’s World / Love Can Move Mountains

Encore 1: River Deep, Mountain High

Encore 2: My Heart Will Go On

Celine Dion Taking Chances Tour at Staples Center, December 2, 2008

Celine Dion Taking Chances Tour at Staples Center, December 2, 2008

Celine Dion Taking Chances Tour at Staples Center, December 2, 2008

Celine Dion Taking Chances Tour, courtesy of Buzzine.com

Celine Dion Taking Chances Tour, courtesy of LATimes.com

Celine Dion Taking Chances Tour, courtesy of Buzzine.com

• In 3Q08, 766,000 foreclosure filings were processed in the U.S.
• Since August 07, 851,000 homeowners have defaulted on their mortgage loans
• In September 08, 81,000 homes were foreclosed upon, a 12% decrease from August
• The foreclosure rates and cycle are the worst in U.S. history. Steps have been taken and laws created to help stem the tide of foreclosure filings. But, are they working?

What States Have Done to Help Stem the Foreclosure Rate

Although the number of foreclosures recorded in September, 08 are substantial and mind boggling, they are still well below the number of foreclosures recorded in August. Part of the reason for the dip is due to new state laws enacted that give homeowners more time to avoid default and to bring their mortgages current.

California, a state with one of the highest national foreclosure rates, requires banks to contact homeowners behind in mortgage payments at least 30 days prior to delivering a Notice of Default. As a result, California defaults decreased 51% September over August. A Notice of Default is a document that the lender files in the county recorder’s office when a borrower is at least 60 days behind on their mortgage payments. It just states simply that the borrower has become delinquent on the mortgage loan. After the Notice is filed, a borrower has 90 days to bring their account current and reinstate the loan.

North Carolina passed a law similar to California’s and defaults decreased there as well by 66%.

The proof that the law works to benefit homeowners would really come after the 30 day period has expired and the news is not that good. What the law has done is to allow homeowners a “free” 30 days in their home before the inevitable default notice arrives.

In Massachusetts, a law was passed in May, 08 forcing lenders to give defaulting homeowners 90 days to bring their mortgage payments current before issuing the Notice of Default. that, in effect, would give the homeowner 180 days - a full half year - to save the home. In September, 90 days after the law was first executed in June, foreclosure filings (NOtive of Default) skyrocketed by 465% September over August.

Is “Hope for Homeowners” Preventing Foreclosures?

To help stabilize the housing market and the economy, a rescue bill called “Hope for Homeowners” was signed in July and enacted on October 1st. “Hope for Homeowners” allocates $300 billion to homeowners which allows them to refinance their mortgages into FHA-backed loans. The Congressional Budget Office (CBO) thinks that the bill could help over 400,000 homeowners which is substantial given that Nevada, the state with the highest foreclosure rate, sees 1 out of 82 homes go into foreclosure while Florida is 2nd at 1 in 178 and California comes in 3rd at 1 in 189. The question, though, is how substantial?

Is “Hope for “Homeowners” working? Not as effectively as was envisioned. One reason is that it is voluntary for lenders to participate and alot of lenders refuse because they would have to write down the existing loan of a homeowner at risk of foreclosure to 90% of the current market value of the home. So, if a lender holds a $1,000,000 mortgage, a mortgage value common in California, and the home is appraised at $800,000 then the lender would have to lend at $720,000 - $280,000 less than the original mortgage note and 90% of $800,000. On the flip side, though, shouldn’t banks look to make these loans given the $600 billion government bailout to the banking industry? How exactly are banks using this money?

The second reason that “Hope for “Homeowners” is not working as effectively for homeowners in risk of foreclosure is that many lenders do not understand the guidelines which were issued on October 1st - it’s only been a month, they say. Nor are lenders prepared to handle the onslaught of demand. Millions will apply.

The third reason is that alot of homeowners do not qualify. To qualify for “Hope for Homeowners”, borrowers must show that they are at risk of foreclosure, that their home is their primary residence and that their mortgage payment is over 31% of their gross monthly income (as of March, 08).

It normally takes 45-60 days to secure a FHA loan so we won’t know if “Hope for “Homeowners” has worked until December but it doesn’t take a rocket scientist to figure out that some borrowers will be saved from foreclosure while a larger percentage sinks deeper into indebtedness and the economy, as a whole, remains in recession.

It’s important to understand the difference between annual percentage rate (APR) and annual percentage yield (APY) because if you don’t, you could end up paying more money on a loan than you ever anticipated. And, if your loan is a mortgage spanning 30 years or so, the increased amount of money that you will have to pay out can be huge.

How Big is the Difference Between APR and APY?

APR and APY Calculation Example

The difference between APR and APY can be quite minimal and quite overbearing. It all depends on the term of the loan and the amount you’re paying back. If the loan is for 2 months, a .12% difference is probably nominal. However, over 30 years, it can be intimidating.

Let’s take a $500,000 mortgage as an example, 30 year term at 5.00%.

If you’re paying strictly on the 5% APR which does not “charge” you a compounded interest rate, then your monthly payment would be $2,684. Total amount paid over 30 years would be $966,279.

However, if you’re being charged on APY, you are being charged a compounded interest rate which means your interest rate is no longer set at 5%; rather, it is now 5.12%. Big deal you think. Well, your monthly payment is now $2,721, an increase of $37. Not too bad you think. Well, the total amount paid over 30 years now increases from $966,279 to $979,523, and increase of $13,244.

How Are APR and APY Calculated?

Calculating Annual Percentage Rate (APR)

APR is a rather simple and familiar calculation.

APR = the periodic rate multiplied by the number of periods in a year. The periodic rate is typically the interest rate charged per month and it is either given to you or you can calculate it if you have the APR.

The periodic rate = (APR) / 12 months.

Example:

.42% = 5% / 12

OR

APR = (periodic rate) x (# periods in a year)

Example:

5% = .42% x 12

Calculating Annual Percentage Yield (APY)

APY is not a familiar calculation but it’s important. Remember, APY deals with compounded interest which really means that principal AND interest are making more interest. It’s good if you are making money this way. You really don’t want to be paying money out this way.

APY = (1 + periodic rate)^ # periods - 1

The “^” in the equation is the exponential character

Example

APY = (1 + .42%)^12 – 1 = 5.12%

OR

APY = (1 + .0042)^12 – 1 = 5.12%

As many a previous presidential general election campaign has proved, running for President demands a different strategy than that of being President. Running for President allows nominees to spout traditional Party ideology and to deliver promises to an electorate that are either deceptive or naive (not understanding that the current economic climate will not allow for such promises). The reason Presidential nominees get away with this deception or naivete falls back on the electorate who can be as uninformed as the nominees themselves. What’s the percentage of the electorate that knows the differing responsibilities of the legislative branch, executive branch and the Federal Reserve Bank. If the electorate doesn’t know who sets interest rates (Fed) or tax policy (Congress and the President), then it is easy to understand how Presidents get elected on superficial rhetoric. In truth, a President must compromise the application of Party ideology in the face of changing real world economics and politics.

How Real World Economics in the United States Affects the Application of Presidential Ideology

The attitude toward the United States economy is negative, lacking confidence, and thus, dire. Stock market prices, which rise and fall on emotion as much as projected earnings, have been free falling for a month now. Asian and European markets have followed the Dow Jones lead. Key economic indicators support our negative attitude. The economy is operating at a budget deficit due to less tax revenues, increased domestic spending and increased spending on national security measures. Over spending has caused the United States to borrow money from U.S. citizens and institutions abroad which has increased our national indebtedness and thus our interest payment on that debt.

Truth be told, our economy’s debt ratio, which is defined as publicly held debt as a percentage of gross domestic product (GDP), is the key indicator of U.S. national indebtedness. The budget deficit is not. This is not to say that we can ignore a budget deficit but, before panic sets in, our debt must be analyzed as a percentage of our nations income, of GDP. Currently, our debt percentage is at its lowest point since World War II. Debt is good in many ways if it is used to fuel economic growth, i.e., new job creation which increases taxable revenue. So, the issue is and is not our debt ratio or our budget deficit but the increasing interest payments we must make on our debt. If we don’t manage or respect our debt, the ability to settle it will be jeopardized and so will all government programs in the future that will require increased monetary support due to aging Baby Boomers and Generation Xers, i.e., Medicare, Medicaid, Social Security, even government jobs and public works projects, for example.

The way to effectively pay off debt is to realize increased cash flows by increasing taxes or stimulating economic growth (which increases tax revenues). But, with our economy at a standstill, is it wise to increase taxes on consumption and income? And what resources do we have left to stimulate the economy? We will most likely have a difficult time paying down interest on our national debt given the war in Iraq which commands billions of taxpayer dollars each month as well as the billions given to our banking system last month to keep the the credit system rolling. Exacerbating the cash flow crunch and interest payments, the Bush Administration issued billions to taxpayers at the beginning of 2008 with the hope of convincing consumers to spend. Not a bad policy, perhaps, but ill-timed misfortune in the face of it all. The housing market was tanking even back then (February, 2008). Some of Bush’s cash handout was spent but then some wasn’t as millions of homeowners had to guard every last penny to save for rising mortgage payments they realistically could no longer afford to pay. Now the Bush Administration is contemplating another round of capital payouts to the general public which, again, could put our economy further into debt and increase our interest payments. However, if the money is spent, will it have been worth it? Possibly. Congress, the President and The Fed are looking at anyway to jumpstart spending and confidence.

But then just last week, The Los Angeles Times advised against consumer’s spending and, instead, pleaded with them to save everything they had even it meant foregoing top colleges for their kids or even the latest XBOX game this holiday season. This, of course, creates an unfortunate domino effect: less spending leads to lower revenue streams for companies in the retail, real estate, and financial sectors, among others. And, in turn, their lower revenue streams domino across the economy: more McDonald’s burgers rather than healthier, more expensive foods bought in supermarkets, less get-togethers with friends (less pizza and beer), and hesitation in buying that new home.

Obama, McCain and the New Economy

As mentioned, economic growth can reduce the debt burden by affording us the extra capital to pay down the interest and subsequently the principal. If economic growth is not the answer, the President can reduce indebtedness (increase government revenues) by increasing taxes or cutting spending. But, if reducing the national debt is derivative of economic health, is it prudent to increase taxes, a move that could slow or hinder economic growth? Is it prudent to cut spending where thousands of Federal and State jobs can be lost? The unemployment rate is currently 6.1%, the highest it’s been since October, 2003. Increasing unemployment (it’s suppoed to climb to 7%+ in 2009) means more unemployment benefits and less taxable revenue for the government to spend. High unemployment rates do not trigger economic growth. Raising taxes will prevent businesses from hiring employees (and may force them to let some go), from investing in research, plants, etc. Business will stall while government takes those tax receipts and does what with them? Pays off debt, give them back in the form of a government-sponsored program that does not target your needs? Could you not have used that tax money for selfishly sounder purposes? Increasing tax rates will not trigger economic growth. If the government wants more revenue, reduce pork-barrel spending. Or better yet, invest it in your people, those that will return a profit on that investment. Be creative! Why steal from Peter, or in this case Warren Buffett, to pay Paul, in this case some homeowners that failed to use good judgment when securing mortgages beyond their means hoping and praying that their inflated home price would inflate even more?

Without some understanding of economics, it is impossible for voters to determine the ramifications of promises made by Obama or McCain. Obama promises tax increases to those individuals and businesses earning over $250,000 in gross income in order to provide tax relief to those not making as much. He goes on to promise a re-programming of the health insurance industry with the clear intention of reducing health and medical insurance premiums. Translation: tax increases, spending increases. McCain promises to lower taxes where he can and he promises credits for health care. Translation: tax relief, less tax revenues, less government spending, impact on government jobs? Obama believes in the power of government to help people. McCain believes in the power of people to help people. In 2008, we need McBama - people need help from people AND its government because the people can’t, on their own, repair an economy harmed by government oversight and public sector greed.

So, Who’s Better for the Economy - Obama or McCain?

If you’re making less than $250,000, you think Obama might be the choice because his policies and ideology seem to translate to more money for you and your family in terms of government assistance, lower taxes and lower health insurance costs. The only way this works is if you reinvest your increased cash flow into the economy and there’s a good chance of that if interest rates stay low. If you’re making over $250,000, McCain seems like the right choice because you get to keep more of your income and determine for yourself where your money goes, i.e., investments in labor, plant expansion, in other businesses, or into your own savings account as a bonus. If you’re a business owner, you might feel cheated because you’ve been promised that you can keep your riches if you earn it and work hard for it - The American Dream, remember? You’re tired of being the bad guy because you have money which the government now wants to better the lives of those that never took the risks that you did. You wonder why tax and spend proponenets don’t realize that you are the one that employs the middle class and without you they would be in more severe trouble?

The choice for President must be made in accordance with the current economic climate, here and abroad. It must be made considering that we are now saddled with a costly war in Iraq, rising unemployment rates, home foreclosures, failing banks, high gas prices and a budget deficit nearing $1 trillion. But, it probably won’t. Voters vote with their wallets, not their neighbor’s wallets. It’s what got Reagan elected.

Nevertheless, heed this warning: the Obama and McCain you think you know will not be the Obama and McCain that run the White House. What you vote for on November 4th is not what you’ll get on January 20th, 2009. Economy indicators will make sure of that.

Is a Republican or Democrat Better for U.S. Economic Growth?  

Around the Lamppost, many the past few weeks have been debating many of the topics that have been raised in the Presidential debates between McCain and Obama and in the Vice Presidential debate between Biden and Palin. One topic has been economic growth given the high price of gas, higher rates of reported unemployment and the foreclosure debacle in 2008 as well as bailout plan approved by the Congress last week. Growing up, our parents always asked us to decide on a President this way: “Look at your wallet - are you better off?” Now, we do know that Presidents only affect fiscal policy (tax rates) and that the Federal Reserve Bank, which is not influenced by the Legislative branch of government, affects monetary policy (interest rates). However, one can influence tha actions of the other. For example, if a President raises taxes, the intention is to fund a shortfall in programs or to create programs and jobs for the well-being of the Nation. OK. However, when taxes are raised, taxpayers and business owners, especially small business owners, have less money to grow their businesses; they can’t purchase equipment, they can’t hire more people (create jobs), they don’t go out to restaurants as much, they don’t travel, etc. Now, to protect jobs, the GDP and a general malaise (recession), the Fed lowers interest rates. Why? Because lowering interest rates makes you less money in a savings or checking account. The Fed is enticing people to spend. And with lower interest rates, there is the hope that credit becomes more available, that the price of goods remains low or controllable, that there are more affordable home values, etc. You see the balance needed to run a functional and productive economy. Power in the hands of one party, group or person is not beneficial. The Founding Fathers realized this in 1776 and thus decided that the Presidency requires a check and balance of its own: the Congress.

But, what happens when the Party enjoying majority rule in both the House of Representatives and the Senate is the same Party that the President is affiliated with? Are we doomed? Or is there better economic growth because the other Party cannot stall the other?. We decided to investigate.

Currently, the Democrats control both the House and the Senate. However, the Democrats do not have a 2/3’s majority in either the House or the Senate. This is important because the Congress can override a Presidential veto by a two-thirds majority for a bill to become a law without the President’s signature. Without a clear majority, any vetoed bill will probably fail to become law unless the President reverses course and decides to sign the bill into law.

Econommic Growth From Ford to GW Bush

* available data only through 2006 although Presidency extends to January 20, 2009.

Economic Growth Conclusions:

Highest Growth Rate occurred during the Ford Presidency - Republican President, Democrats controlled both House and Senate

Lowest Growth Rate occurred during the Clinton Adminstration - Democrat President, Republican controlled House and Senate

Best Overall Growth occurs when the President is NOT the same party as the House and Senate - i.e., Ford 4.6%, Reagan 3.5%, GHW Bush 2.7%, exception is George W. Bush who experienced 3.3% growth with a Republican controlled House and Senate

Unemployment Rate Conclusions:

Highest unemployment rate - Carter @ 7.6%

Lowest Unemployment Rate - GW Bush @ 4.6%

3 Republicans Presidents presided over 3 of 4 highest unemployment rates

Inflation Rate Conclusions:

Highest inflaton rate - Carter @ 8.9%

Lowest inflaton rate - Clinton @ 1.6%

Parties Controlling Congress - From Ford to G.W. Bush

Gerald Ford - Aug, 1974 – Jan, 1977

• 1975 – 77: Senate and House = Democrats

Jimmy Carter - Jan, 1977 – Jan, 1981

• 1977-79: Senate and House = Democrats
• 1979-81: Senate and House = Democrats

Ronald Reagan - Jan, 1981 – Jan, 1989

• 1981 – 83: House = Democrats, Senate = Republicans
• 1983 – 85: House = Democrats, Senate = Republicans
• 1985 – 87: House = Democrats, Senate = Republicans
• 1987 – 89: Senate and House = Democrats

George H.W. Bush - Jan, 1989 – Jan, 1993

• 1989 – 91: Senate and House = Democrats
• 1991 – 93: Senate and House = Democrats

Bill Clinton - Jan, 1993 – Jan, 2001

• 1993 – 95: Senate and House = Democrats
• 1995 – 97: Senate and House = Republicans
• 1997 – 99: Senate and House = Republicans
• 1999 – 2001: Senate and House = Republicans

George W. Bush - Jan, 2001 - Jan, 2009

• 2001 – 03: House = Republicans and Senate controlled by Democrats for 18 days, then Republicans for 6 months, then Democrats for 5 months, then finally Republicans again for about 2 months
• 2003 – 05: Senate and House = Republicans
• 2005 – 07: Senate and House = Republicans
• 2007 – 09: House = Democrats, Senate = Democrats even though they share the same amount of seats with Republicans (49)

One of the first comments we heard within days of Sarah Palin being selected as the Republican Vice Presidential nominee was that she was chosen solely to attract the Hillary Clinton vote. Many men and mostly women under the Lamppost were appalled, I think with a bit of oh-my-gosh help from journalists, that McCain would think women stupid enough to fall for such a political trick. We never do mind the outrage. After all, political ideology is an outgrowth of our social, religious, economic, and sometimes conditioned beliefs. What was interesting was the inference that choosing Palin was an unprecedented political strategy never attempted in American politics.

To repeat, as we have many times previously, the Lamppost is chock full of baby-boomers and is bipartisan in a sort of Lars Larsen-like way (did you see his measured responses on Larry King Live wrapups after each Convention this summer amidst the partisan demagogues?). The words of those under the Lamppost might be skewed one way or the other but our Commentary is not. We sift through the opinions and outrages and dish just the facts, or in this case, political precedents.

There is no doubt that one strong reason, if not the main reason, Sarah Palin was chosen to accompany John McCain on the Republican Presidential ticket was to steal Hillary Clinton votes from the Democrats. Sentiment was strong against Obama amongst Clinton supporters after Hillary grudgingly handed over her delegates to unify the Democratic Party. Some interviewed parties and bloggers threatened to never vote for Obama, that he was too green (Hillary called him “too inexperienced”) and did not represent their ideology. They even threatened to either not vote at all - thus holding back their delegate vote if they had one - or cross the aisle and vote for McCain. McCain supporters took note.

The Name of the Political Game is to get Elected

In 1952, two elections prior to Kennedy’s win in 1960, Democratic nominee Adlai Stevenson won only 9 states against Republican Dwight Eisenhower. Stevenson’s wins came mostly in the Bible Belt of America: Mississippi, Alabama, Georgia, South Carolina, North Carolina, Louisiana, Arkansas, Kentucky and West Virginia. He did not even win his home state of Illinois where he was the sitting Governor.

In 1956, the election prior to Kennedy’s win in 1960, Adlai Stevenson again ran against Eisenhower, now the incumbent President. Again, Stevenson faired poorly winning only 7 states and all coming again from the Bible Belt: Mississippi, Alabama, Georgia, South Carolina, North Carolina, Missouri, and Arkansas. This time, Louisiana, Kentucky and West Virginia voted the other way and yet again, his home state of Illinois, failed to support him.

Fast forward to the 1960 election for Kennedy - an uphill climb for Democrats at best considering historical trends. Kennedy, a Catholic from Massachusetts, needed a running mate to help attract votes outside of the Bible Belt and the northeast. He needed to appeal to conservative southern voters. Senator Stuart Symington of Missouri was favored by Kennedy’s family and advisors. Kennedy liked Symington but the Democrats had won in Missouri in 1956. Kennedy needed broader appeal and he also had to face down the issues of the day including the sagging economy, Cuba, the Soviet’s perceived space and missile advantage over the United States and, of course, his Catholicism. So, Kennedy chose Senator Lyndon Johnson of Texas, the reigning Senate Majority Leader.

As we all know, Kennedy, with a bit of help from television and his father, Joe Kennedy, won the election in 1960 to become the 35th president of the United States. He did win the Bible Belt and he did win the northeastern states of Massachusetts, Connecticut, Rhode Island, New York, New Jersey, Delaware, Pennsylvania and Maryland.

But, because of Johnson, he also won Texas, New Mexico, Nevada, Minnesota, and Michigan. He won Adlai Stevenson’s state of Illinois, a state Stevenson himself couldn’t win in two tries. And he got back West Virginia.

How important was Lyndon Johnson to Kennedy? Kennedy won the popular vote by 119,450 votes. He won the electoral vote by a wider margin: 303-219. However, take away Texas’ 24 electoral votes, New Mexico’s 4 electoral votes and Louisiana’s 10 electoral votes, and Kennedy does not win.

Without Lyndon Johnson, Kennedy does not win. Without a running mate leveraged for political advantage, Richard Nixon is elected President in 1960, not in 1969.

Oh, and by the way…

Here’s the kicker: there was no one on the face of the earth that Kennedy disliked more than Lyndon Johnson.

The name of the political game is to get elected.

It’s been a few weeks since the Democratic and Republican National Conventions have wrapped up. Usually, one party will enjoy a pretty nice spike in approval rating right after their Convention has ended. This year, however, it just didn’t happen. Both parties experienced approval ratings far less than 10%. In the weeks since the Convention ended, McCain had a slight edge in the National polls but Obama has edged ahead the past couple of days and might hold that lead, at least in the short-term, as McCain suspends his campaign to go back to Washington to try to help negotiate a better Bailout Bill.

Clinton last night on Larry King live mentioned that each party has about a 45% voting base. Don’t know if he’s right but even if he’s off a little, the point is made: Obama and McCain are fighting for the vote of 10% of uncommitted Americans. Is it possible that the Presidential Election plays out like the scenario depicted in Kevin Costner’s Swing Vote? Could the election hinge on one state? Then a particular county of that state? Then finally, when all votes are counted, we realize there is still a tie which can be broken because the vote of one citizen was not counted?

What People under the Lamppost are Saying These Days

Palin’s selection was an affront to women. Why would the Republicans think that they could buy the Hillary vote simply by hiring Palin as the Deputy Sheriff? She’s good-looking, though.

When is Obama going to lay out his plan. When is he going to tell me how he is going to take care of me, my family and especially my small business? I want to vote for Obama but I can’t right now. I could change my mind but it’s up to Obama to convince me. Here’s why: Obama has been preaching for 2 ½ years now that he is going to tax the rich and help the less fortunate. That‘s a big word: the less fortunate. Who makes up the less fortunate? Well, the very people I see him speaking in front of: fellow blacks, Hispanics, etc. What about small business-owning blacks, Hispanics, Asians, Caucasians, Persians, etc.? I don’t ask for handouts. I get up and work all day long. I pay my taxes. I can’t afford a house because the real estate prices in the state I live in are way too high. I’m frankly tired of the Democrats saying they will tax the rich and give it to the poor. They’ve been saying that since I was born which I think is why the Republicans have owned the White House for almost 60% of my lifetime. What’s wrong with being rich? I am in business to, yes, enjoy working for myself, but ultimately I would like to sell the business and reap the profits, however large. What I hear from Democrats is that it is ok to be rich, but not too rich. Frankly, I don’t care if McCain has 7 homes or 20 homes. That’s his business. Obama should know from Economics 101 that the reward should be proportionate to the risk. What I want from Obama is assurance that he can be creative and use his Harvard-educated mind to develop a plan that allows people to prosper while taking care of and encouraging the less fortunate. I belie e in helping the less fortunate. I believe in being socially responsible. I also believe in developing a prosperous business. Obama, how are you going to allow me to do that? For now, the vote goes to McCain but Obama, if you’re listening, I’m all ears.

Why are people so upset at the Palin selection? The complaints about Palin have been that she is a woman and, as such, McCain thinks he can get the Hillary women to cross the aisle. We haven’t heard much about her experience, in terms of complaints.

Agree or disagree with the Palin selection. That’s fine. But why be affronted because McCain is trying to woo your vote – if you’re a woman? Do people realize the Vice Presidential selection is all about politics? Remember Kennedy? He chose Lyndon Johnson from Texas. Kennedy hated Johnson. He would rather have eaten dinner with Nikita Krushchev than with Johnson. Kennedy needed the South and he needed Texas. There you have it. And it goes on. Obama chose Biden to try to neutralize the sentiment that he was too green, too inexperienced.