IHT Rendezvous: Drones, Brennan and Obama's Legacy of Secrecy

NEW YORK — John O. Brennan’s testimony before the Senate Intelligence Committee on Thursday was representative of the Obama administration’s approach to counter-terrorism: right-sounding assurances with little transparency.

Mr. Brennan, the president’s choice to be the next head of the Central Intelligence Agency, said the United States should publicly disclose when American drone attacks kill civilians. He called water boarding “reprehensible” and vowed it would never occur under his watch. And he said that countering militancy should be “comprehensive,” not just “kinetic,” and involve diplomatic and development efforts as well.

What any of that means in practice, critics say, remains unknown.

Mr. Brennan failed to clearly answer questions about the administration’s excessive embrace of drone strikes and secrecy.

He flatly defended the quadrupling of drone strikes that has occurred on President Obama’s watch. He gave no clear explanation for why the public has been denied access to Justice Department legal opinions that give the president the power to kill U.S. citizens without judicial review. And his statement that the establishment of a special court to review the targeting of Americans was “worthy of discussion” was noncommittal.

Before the hearing administration officials defended the career CIA officer who has served as the president’s chief counter-terrorism adviser throughout his first term. A senior administration official who asked not be named said that Mr. Brennan has actively worked to reduce drone attacks and increase transparency.

Officials described him as a traditionalist who would move the CIA away from the paramilitary attacks that have come to define its mission since 2001. Instead, the agency would move back to espionage and hand over lethal strikes, including drone attacks, to the military’s Special Operations forces.

Over the last two years, drone strikes in Pakistan have, in fact, decreased by nearly two-thirds from a peak of 122 in 2010 to 48 last year, according to The New American Foundation. At the same time, strikes in Yemen have increased, killing an estimated 400 people including 80 civilians.

From his office in the basement of the White House, Mr. Brennan has been at the center of it all. Daniel Benjamin, who recently stepped down as the State Department’s top counterterrorism official, told the New York Times this week that Mr. Brennan had sweeping authority.

“He’s probably had more power and influence than anyone in a comparable position in the last 20 years,” said Mr. Benjamin. “He’s had enormous sway over the intelligence community. He’s had a profound impact on how the military does counterterrorism.”

Some former military and intelligence officials have warned that the administration’s drone strikes have shifted from an attempt to only target senior militants to a de facto bombing campaign against low-level fighters. They say such a policy creates high levels of public animosity toward the United States with questionable results.

In a recent interview with Reuters, retired Gen. Stanley McChrystal, the former commander of American forces in Afghanistan, said drones were useful tools, but they are “hated on a visceral level” in many countries and contribute to a “perception of American arrogance.”

In Thursday’s hearing, Mr. Brennan showed an awareness of how excessive use of force can be counterproductive. He also aggressively defended the need for the United States to abide by the rule of law, a vital practice if the US is going to ever gain popular support in the region.

In one of his strongest moments, Mr. Brennan flatly rejected suggestions by Senator Marco Rubio of Florida that U.S. officials should have pressured Tunisian officials to improperly detain a suspect in the fatal attack on the U.S. consulate in Benghazi, Libya. Mr. Brennan said Tunisian officials had no evidence linking the man to the incident.

“Senator, this country needs to make sure we are setting an example and a standard for the world,” he said, adding that Washington had to “respect the rights of these governments to enforce their laws independently.”

Mr. Brennan also argued that opponents of the program misunderstood it. He said the United States only used drone strikes as a “last resort,” and the administration goes through “agony” before launching drone strikes in order to avoid civilian casualties.

In truth, the administration’s insistence on keeping the drone program secret fuels public suspicion. Declaring a program “covert” when it is reported on by the global media on a daily basis is increasingly absurd: as Joshua Foust, an analyst and former U.S. intelligence official, has argued, keeping the program secret cedes the debate to critics who say the strikes only kill vast numbers of civilians.

It is easy to see why many analysts say the United States should continue to carry out drone strikes – they are a military necessity – but keep them to a minimum. And details such as why an attack is carried out, who is killed and any civilian casualties should be publicly disclosed.

Mr. Brennan’s statement that drone strikes have decimated al Qaeda’s core leadership in Pakistan’s tribal areas was largely accurate. But despite the increase in strikes under Mr. Obama, the attacks have failed to do the same to the Afghan and Pakistani Taliban operating out of the same area. Drone strikes will never be a silver bullet. They have created a stalemate in Pakistan, weakening militant groups but not eliminating them.

After the hearing, Sen. Dianne Feinstein, the Democratic chair of the Senate Intelligence Committee, said she was considering drafting legislation that would create a special court to review requests by the president to target Americans under certain circumstances. The new body would be similar to the court that currently reviews government requests to wiretap citizens.

Critics point out that the Obama administration has a long record of promising transparency and then embracing secrecy — from drone strikes to legal memos to unprecedented prosecutions of government officials for leaking to the news media.

Overall, Mr. Brennan impressed those watching yesterday. We will see if he moves the CIA and the administration toward greater transparency. What he and the president plan remains secret.


David Rohde is a columnist for Reuters, former reporter for The New York Times and two-time winner of the Pulitzer Prize. His forthcoming book, “Beyond War: Reimagining American Influence in a New Middle East” will be published in March 2013.

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Meet the Kings of Leon's Newest Addition




Celebrity Baby Blog





02/09/2013 at 10:00 AM ET



Nathan Followill Jessie Baylin Violet Marlowe First Photo
Courtesy Nathan Followill


It’s the newest addition to the Kings of Leon!


Drummer Nathan Followill and singer-songwriter Jessie Baylin introduce their little lady, 6-week-old Violet Marlowe, via Twitter Friday evening.


“Hello world, my name is Violet, nice to meet you,” Followill, 33, wrote in the voice of his daughter, sharing a photo of her diapered and wrapped in a cozy blanket.


The couple, who married in November 2009, welcomed their baby girl on Dec. 26 and were quickly smitten.


“Violet’s hair color needs to be bottled… perfectly strawberry blonde.” Baylin, 28, Tweeted earlier this week.


The Kings will hit the road again in June for a string of European dates.


– Sarah Michaud


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After early start, worst of flu season may be over


NEW YORK (AP) — The worst of the flu season appears to be over.


The number of states reporting intense or widespread illnesses dropped again last week, and in a few states there was very little flu going around, U.S. health officials said Friday.


The season started earlier than normal, first in the Southeast and then spreading. But now, by some measures, flu activity has been ebbing for at least four weeks in much of the country. Flu and pneumonia deaths also dropped the last two weeks, the Centers for Disease Control and Prevention reported.


"It's likely that the worst of the current flu season is over," CDC spokesman Tom Skinner said.


But flu is hard to predict, he and others stressed, and there have been spikes late in the season in the past.


For now, states like Georgia and New York — where doctor's offices were jammed a few weeks ago — are reporting low flu activity. The hot spots are now the West Coast and the Southwest.


Among the places that have seen a drop: Lehigh Valley Hospital-Cedar Crest in Allentown, Pa., which put up a tent outside its emergency room last month to help deal with the steady stream of patients. There were about 100 patients each day back then. Now it's down to 25 and the hospital may pack up its tent next week, said Terry Burger, director of infection control and prevention for the hospital.


"There's no question that we're seeing a decline," she said.


In early December, CDC officials announced flu season had arrived, a month earlier than usual. They were worried, saying it had been nine years since a winter flu season started like this one. That was 2003-04 — one of the deadliest seasons in the past 35 years, with more than 48,000 deaths.


Like this year, the major flu strain was one that tends to make people sicker, especially the elderly, who are most vulnerable to flu and its complications


But back then, that year's flu vaccine wasn't made to protect against that bug, and fewer people got flu shots. The vaccine is reformulated almost every year, and the CDC has said this year's vaccine is a good match to the types that are circulating. A preliminary CDC study showed it is about 60 percent effective, which is close to the average.


So far, the season has been labeled moderately severe.


Like others, Lehigh Valley's Burger was cautious about making predictions. "I'm not certain we're completely out of the woods," with more wintry weather ahead and people likely to be packed indoors where flu can spread around, she said.


The government does not keep a running tally of flu-related deaths in adults, but has received reports of 59 deaths in children. The most — nine — were in Texas, where flu activity was still high last week. Roughly 100 children die in an average flu season, the CDC says


On average, about 24,000 Americans die each flu season, according to the CDC.


According to the CDC report, the number of states with intense activity is down to 19, from 24 the previous week, and flu is widespread in 38 states, down from 42.


Flu is now minimal in Florida, Kentucky, Maine, Montana, New Hampshire and South Carolina.


___


Online:


CDC: http://www.cdc.gov/flu/


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Stocks end higher for sixth straight week, tech leads

NEW YORK (Reuters) - The Nasdaq composite stock index closed at a 12-year high and the S&P 500 index at a five-year high, boosted by gains in technology shares and stronger overseas trade figures.


The S&P 500 also posted a sixth straight week of gains for the first time since August.


The technology sector led the day's gains, with the S&P 500 technology index <.splrct> up 1.0 percent. Gains in professional network platform LinkedIn Corp and AOL Inc after they reported quarterly results helped the sector.


Shares of LinkedIn jumped 21.3 percent to $150.48 after the social networking site announced strong quarterly profits and gave a bullish forecast for the year.


AOL Inc shares rose 7.4 percent to $33.72 after the online company reported higher quarterly profit, boosted by a 13 percent rise in advertising sales.


Data showed Chinese exports grew more than expected, a positive sign for the global economy. The U.S. trade deficit narrowed in December, suggesting the U.S. economy likely grew in the fourth quarter instead of contracting slightly as originally reported by the U.S. government.


"That may have sent a ray of optimism," said Fred Dickson, chief market strategist at D.A. Davidson & Co in Lake Oswego, Oregon.


Trading volume on Friday was below average for the week as a blizzard swept into the northeastern United States.


The U.S. stock market has posted strong gains since the start of the year, with the S&P 500 up 6.4 percent since December 31. The advance has slowed in recent days, with fourth-quarter earnings winding down and few incentives to continue the rally on the horizon.


"I think we're in the middle of a trading range and I'd put plus or minus 5.0 percent around it. Fundamental factors are best described as neutral," Dickson said.


The Dow Jones industrial average <.dji> ended up 48.92 points, or 0.35 percent, at 13,992.97. The Standard & Poor's 500 Index <.spx> was up 8.54 points, or 0.57 percent, at 1,517.93. The Nasdaq Composite Index <.ixic> was up 28.74 points, or 0.91 percent, at 3,193.87, its highest closing level since November 2000.


For the week, the Dow was down 0.1 percent, the S&P 500 was up 0.3 percent and the Nasdaq up 0.5 percent.


Shares of Dell closed at $13.63, up 0.7 percent, after briefly trading above a buyout offering price of $13.65 during the session.


Dell's largest independent shareholder, Southeastern Asset Management, said it plans to oppose the buyout of the personal computer maker, setting up a battle for founder Michael Dell.


Signs of economic strength overseas buoyed sentiment on Wall Street. Chinese exports grew more than expected in January, while imports climbed 28.8 percent, highlighting robust domestic demand. German data showed a 2012 surplus that was the nation's second highest in more than 60 years, an indication of the underlying strength of Europe's biggest economy.


Separately, U.S. economic data showed the trade deficit shrank in December to $38.5 billion, its narrowest in nearly three years, indicating the economy did much better in the fourth quarter than initially estimated.


Earnings have mostly come in stronger than expected since the start of the reporting period. Fourth-quarter earnings for S&P 500 companies now are estimated up 5.2 percent versus a year ago, according to Thomson Reuters data. That contrasts with a 1.9 percent growth forecast at the start of the earnings season.


Molina Healthcare Inc surged 10.4 percent to $31.88 as the biggest boost to the index after posting fourth-quarter earnings.


The CBOE Volatility index <.vix>, Wall Street's so-called fear gauge, was down 3.6 percent at 13.02. The gauge, a key measure of market expectations of short-term volatility, generally moves inversely to the S&P 500.


"I'm watching the 14 level closely" on the CBOE Volatility index, said Bryan Sapp, senior trading analyst at Schaeffer's Investment Research. "The break below it at the beginning of the year signaled the sharp rally in January, and a rally back above it could be a sign to exercise some caution."


Volume was roughly 5.6 billion shares traded on the New York Stock Exchange, the Nasdaq and the NYSE MKT, compared with the 2012 average daily closing volume of about 6.45 billion.


Advancers outpaced decliners on the NYSE by nearly 2 to 1 and on the Nasdaq by almost 5 to 3.


(Additional reporting by Angela Moon; Editing by Bernadette Baum, Nick Zieminski, Kenneth Barry and Andrew Hay)



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Fire Destroys Offices of Israeli Soccer Team That Recruited Muslims




Integrating Israeli Soccer:
The Times’s Jodi Rudoren looks at lingering racism in the stands of the last Israeli soccer team to field Muslim players.







JERUSALEM — Prime Minister Benjamin Netanyahu of Israel on Friday condemned as “shameful” the recent protests by soccer fans here of their team’s recent recruitment of two Muslim players, hours after the offices of the team were burned in what the police suspect was an arson set by some of those fans.




“We cannot accept such racist behavior,” Mr. Netanyahu said. “The Jewish people, who suffered excommunications and expulsions, need to represent a light unto the nations.”


The team, Beitar Jerusalem, has long been linked to Mr. Netanyahu’s Likud Party, and for 15 years has been notorious for racism and violence, including an incident last spring in which fans stormed a local mall chanting “Death to Arabs” and beat up several Arab employees. Founded in 1936, it is the only one of Israel’s professional soccer teams never to have recruited an Arab player.


The current controversy concerns the team’s addition of two Muslim players from Chechnya. Although one is injured, the other is expected to play for the first time in a match on Sunday against a team from Sakhnin, an Arab-Israeli town.


In anticipation of the Muslim players’ arrival, some fans unfurled a banner at the team’s Jan. 26 game saying “Beitar Pure Forever.” Some critics said the banner was reminiscent of Nazi Germany’s expulsion of Jews from sport, and it led to nationwide soul-searching.


Four fans were indicted on Thursday for incitement. Beitar headquarters were set on fire at 5 a.m. Friday, according to the police, destroying the team’s trophies, commemorative jerseys of former stars, championship flags, photographs and books. “All the history of Beitar Jerusalem,” said the team spokesman, Asaf Shaked. “It’s not damage by money, it’s damage by emotion.”


The mayor of Jerusalem, Nir Barkat, also condemned the violence on Friday, likening the perpetrators to the mafia. Limor Livnat, Israel’s minister of culture and sport, said she would attend Sunday’s game to show support for the team’s management.


Micky Rosenfeld, a police spokesman, said a special investigative team was looking into the arson, which he said “gushed through the offices,” and that the police would not only send hundreds of extra officers to Sunday’s game, but seek to arrest troublemakers beforehand.


Eli Abarbanel, a senior state prosecutor and Beitar fan, said on Israel Radio Friday that the soccer struggle reflected “a broad phenomenon of racism in all of Israeli society,” citing expressions of “joy” on social media after a recent bus accident that killed 20 Palestinian children.


Itzik Kornfein, Beitar’s manager, also said that the dispute had “gone beyond sports” and had “ramifications for Israeli society and for how we look to the world.” Speaking to Israel Radio, Mr. Kornfein vowed not to back down from his decision to integrate the team, saying, “I don’t compromise on the matter of racism” and predicting that “after violence of this kind, people will come to their senses.”


Mr. Shaked, the Beitar spokesman, said management would “continue to fight against this part of the fans” and “continue to hug the two players” in order “to show all the world” that the club is not defined by the slogans shouted from the stands.


“I hope that from this Sunday we’re going to start a new way for the club,” he said. “We call that ‘The New Beitar.’ This is the slogan of the club now: a different Beitar, a new Beitar.”


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Steven Tyler Proposes New Senate Bill in Hawaii















02/08/2013 at 10:45 AM EST



Jennifer Aniston and Justin Bieber have spoken out about the need for rules and regulations surrounding the paparazzi – most recently after a paparazzo was killed in a tragic accident.

Now, Steven Tyler is adding his voice to the mix.

The rock star and American Idol alum, 64, has proposed Hawaii Senate Bill 465 – now dubbed the Steven Tyler Act – which the would provide a legal remedy for celebrities photographed while engaged in "personal or familial activity" and have a reasonable expectation of privacy, according to a press release obtained by PEOPLE Friday.

"The paradise of Hawaii is a magnet for celebrities who just want a peaceful vacation," says Tyler. "As a person in the public eye, I know the paparazzi are there and we have to accept that. But when they intrude into our private space, disregard our safety and the safety of others, that crosses a serious line that shouldn't be ignored."

The bill will be presented in a Senate hearing in Honolulu, Hawaii. It is currently being endorsed by two-thirds of the Senate.

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Southern diet, fried foods, may raise stroke risk


Deep-fried foods may be causing trouble in the Deep South. People whose diets are heavy on them and sugary drinks like sweet tea and soda were more likely to suffer a stroke, a new study finds.


It's the first big look at diet and strokes, and researchers say it might help explain why blacks in the Southeast — the nation's "stroke belt" — suffer more of them.


Blacks were five times more likely than whites to have the Southern dietary pattern linked with the highest stroke risk. And blacks and whites who live in the South were more likely to eat this way than people in other parts of the country were. Diet might explain as much as two-thirds of the excess stroke risk seen in blacks versus whites, researchers concluded.


"We're talking about fried foods, french fries, hamburgers, processed meats, hot dogs," bacon, ham, liver, gizzards and sugary drinks, said the study's leader, Suzanne Judd of the University of Alabama in Birmingham.


People who ate about six meals a week featuring these sorts of foods had a 41 percent higher stroke risk than people who ate that way about once a month, researchers found.


In contrast, people whose diets were high in fruits, vegetables, whole grains and fish had a 29 percent lower stroke risk.


"It's a very big difference," Judd said. "The message for people in the middle is there's a graded risk" — the likelihood of suffering a stroke rises in proportion to each Southern meal in a week.


Results were reported Thursday at an American Stroke Association conference in Honolulu.


The federally funded study was launched in 2002 to explore regional variations in stroke risks and reasons for them. More than 20,000 people 45 or older — half of them black — from all 48 mainland states filled out food surveys and were sorted into one of five diet styles:


Southern: Fried foods, processed meats (lunchmeat, jerky), red meat, eggs, sweet drinks and whole milk.


—Convenience: Mexican and Chinese food, pizza, pasta.


—Plant-based: Fruits, vegetables, juice, cereal, fish, poultry, yogurt, nuts and whole-grain bread.


—Sweets: Added fats, breads, chocolate, desserts, sweet breakfast foods.


—Alcohol: Beer, wine, liquor, green leafy vegetables, salad dressings, nuts and seeds, coffee.


"They're not mutually exclusive" — for example, hamburgers fall into both convenience and Southern diets, Judd said. Each person got a score for each diet, depending on how many meals leaned that way.


Over more than five years of follow-up, nearly 500 strokes occurred. Researchers saw clear patterns with the Southern and plant-based diets; the other three didn't seem to affect stroke risk.


There were 138 strokes among the 4,977 who ate the most Southern food, compared to 109 strokes among the 5,156 people eating the least of it.


There were 122 strokes among the 5,076 who ate the most plant-based meals, compared to 135 strokes among the 5,056 people who seldom ate that way.


The trends held up after researchers took into account other factors such as age, income, smoking, education, exercise and total calories consumed.


Fried foods tend to be eaten with lots of salt, which raises blood pressure — a known stroke risk factor, Judd said. And sweet drinks can contribute to diabetes, the disease that celebrity chef Paula Deen — the queen of Southern cuisine — revealed she had a year ago.


The National Institute of Neurological Disorders and Stroke, drugmaker Amgen Inc. and General Mills Inc. funded the study.


"This study does strongly suggest that food does have an influence and people should be trying to avoid these kinds of fatty foods and high sugar content," said an independent expert, Dr. Brian Silver, a Brown University neurologist and stroke center director at Rhode Island Hospital.


"I don't mean to sound like an ogre. I know when I'm in New Orleans I certainly enjoy the food there. But you don't have to make a regular habit of eating all this stuff."


___


Marilynn Marchione can be followed at http://twitter.com/MMarchioneAP


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Wall Street advances after stream of economic data

NEW YORK (Reuters) - Stock index rose on Friday after a batch of positive economic data points, but gains were checked with the benchmark S&P index at five-year highs as investors looked for strong catalysts to push the market further upward.


Data showed Chinese exports grew more than expected in January, while imports climbed 28.8 percent, highlighting robust domestic demand, while German data showed a 2012 surplus that was the nation's second highest in more than 60 years, an indication of the underlying strength of Europe's biggest economy.


Another positive sign was U.S. economic data which showed the trade deficit shrank in December to $38.5 billion, its narrowest in nearly three years, indicating the economy did much better in the fourth quarter than initially estimated.


But wholesale inventories unexpectedly fell 0.1 percent in December as auto dealers and agricultural suppliers drew down their stocks.


The S&P 500 <.spx> has risen for five straight weeks and is up 6.3 percent for the year. Its advance was helped by legislators in Washington averting a series of automatic spending cuts and tax hikes earlier in the year, as well as better-than-expected corporate earnings and data that pointed to modest economic improvement but no immediate change in the Federal Reserve's stimulus plans.


The index, hovering near five-year highs, has found it tougher to climb in recent days as investors await strong trading incentives to drive it further upward.


"We are going to have this churn and this consolidation, which actually isn't a bad thing - it's actually good the market isn't being so volatile and is actually consolidating because it is building a base," said Ken Polcari, Director of the NYSE floor division at O'Neil Securities in New York.


"If it builds a base, from there it is easier to make the argument that you move ahead."


The Dow Jones industrial average <.dji> gained 67.62 points, or 0.48 percent, to 14,011.67. The Standard & Poor's 500 Index <.spx> climbed 7.82 points, or 0.52 percent, to 1,517.21. The Nasdaq Composite Index <.ixic> rose 27.34 points, or 0.86 percent, to 3,192.47.


McDonald's Corp said January sales at established hamburger restaurants around the world fell 1.9 percent, a steeper decline than analysts expected. Still, shares edged up 0.5 percent to $94.11.


Healthcare stocks were among the best performers, with the Morgan Stanley healthcare payor index <.hmo> up 2.3 percent. Molina Healthcare Inc surged 12.1 percent to $32.36 as the biggest boost to the index after posting fourth-quarter earnings.


LinkedIn Corp jumped 19.3 percent to $148.02 after announcing blow-out quarterly profits and a bullish forecast for the year that exceeded Wall Street's already lofty expectations.


According to Thomson Reuters data through Friday morning, of 339 companies in the S&P 500 that have reported earnings, 69.9 percent have exceeded analysts' expectations, above a 62 percent average since 1994 and 65 percent over the past four quarters.


Fourth-quarter earnings for S&P 500 companies grew 5.2 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.


(Editing by Bernadette Baum)



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Way of the World: Theorizing About Taxing High Earners







NEW YORK — Academics can be dismissive of the concerns of the popular media. But when it comes to the growth of the superrich, the tabloids may have gotten it right.




The numbers tell the story. According to a study by John Van Reenen of the London School of Economics and Brian Bell of Oxford University, the share of national income earned by the top 1 percent in the United States surged to 18.3 percent in 2007, from 8 percent in 1979. In Britain, the trend was almost identical: The top 1 percent received 15.4 percent of the national income in 2007 compared with 5.9 percent in 1979. And these figures exclude capital gains.


“A lot of the action has been at the very top end of the distribution, the top 1 percent or the top 0.1 percent,” Mr. Van Reenen, director of the Center for Economic Performance at the L.S.E., told me. “It shows you that the media’s focus on the very rich and on bankers’ bonuses wasn’t misplaced.”


But while much of the shift in income distribution has been at the apex of the pyramid, that is not where most academic research on rising income inequality has been focused.


If anything, Mr. Van Reenen said, academics “have tended to focus on the bottom of the distribution, much more than the top.”


Mr. Van Reenen and some like-minded colleagues have been working to fill that gap. Their efforts made it to the economic major leagues in January, when Mr. Van Reenen convened a panel discussion on extreme wage inequality at the prestigious annual get-together of the American Economic Association.


One of the most striking findings will probably give comfort to the plutocrats: In contrast to previous generations, the superrich today tend to have earned their fortunes rather than inherited them.


Steven Kaplan of the University of Chicago and Joshua Rauh of Stanford University in California studied Forbes magazine’s annual list of the 400 richest Americans. They found that in 1982, just 40 percent of these plutocrats had built their own businesses. By 2011, the superrich had gotten much richer — the combined wealth of the Forbes 400 was $92 billion in 1982 and had surged to $1.53 trillion by 2011 — and many more of them had, as the meme of the 2012 U.S. presidential election campaign had it, built it themselves: 69 percent.


“This isn’t the Downton Abbey rentier class,” explained Mr. Van Reenen, who has found a similar trend in Britain. “These incomes come from the labor market. You can say it is a triumph of the human capitalists over the physical capitalists.”


Among economists who study the surge in pay at the top, it is pretty much a truth universally acknowledged that taxes should rise at the summit, too. “Economics would suggest that when you have big increases in inequality, the top tax rate should rise,” Mr. Van Reenen said. “That seems very right and very reasonable.”


The impact and the structure of higher taxes for the rich are a more complicated and controversial issue. Timothy Besley and Maitreesh Ghatak, both of the London School of Economics, make a robust case for higher taxes on bankers’ bonuses. Their work is theoretical, but beyond the campus green, what may be particularly interesting is the way they frame the wider debate.


“Little undermines the case for a market economy more than the perception that there is injustice in the rewards that it generates,” they argue in a recent paper. “The greatest clamor for reform should come from those who support the market system.”


“We have shown that some form of bonus taxation in the financial sector is optimal above and beyond standard progressive income taxation,” they conclude. “We have identified a form of taxation that we believe makes the market system both fairer and more efficient.”


This robustly pro-market rationale for higher taxes on bankers, who like to think of themselves as the very embodiment of capitalism, is eye-catching, particularly for anyone who spends much time in the United States, where higher taxes and more efficient markets are usually portrayed as being anathema to one another.


Emmanuel Saez, an economist at the University of California, Berkeley, who is one of the pioneering students of incomes at the very top, has offered an even more provocative suggestion. At the American Economic Association meeting, he argued that when tax rates at the top are low, “top earners extract more pay at the expense of the 99 percent.” Higher tax rates for the rich, he suggested, “reduce the pretax income gap without hurting economic growth.”


This is a truly radical idea: that higher taxes at the top can reduce pretax inequality and not weaken the economy as a whole.


Outside the seminar room, however, these elegant ideas may run into political opposition intensified by the trends within the 1 percent that these same economists have documented.


“It may have a political effect,” Mr. Van Reenen said of the shift from inherited fortunes to self-made ones. “You feel you’ve earned it. This does make people more strongly inclined to resist taxation.”


Chrystia Freeland is editor of Thomson Reuters Digital.


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Diem Brown Reacts to Cancer-Free News

In her PEOPLE.com blog, Diem Brown, the Real World/Road Rules Challenge contestant recently diagnosed with ovarian cancer for the second time, opens up about her desire for a child and the ups and downs of cancer and fertility procedures.

Getting the call that changes your life ... literally!

I have been in this intense limbo ever since Jan. 4 when my CT Scan showed signs of a mass in my liver, which meant that there was a possible cancer spread.

Being a "veteran" of this now, I understood the doctors' concern because if cancer had spread into my liver, it was more than likely transferred by a lymph node – meaning the cancer could also be in other parts of my body.

Having that much cancer spread seemingly all throughout your body is terrifying! I felt as if I was placed in some sort of cancer maze, where as soon as I was close to an exit, a wall would quickly slam down keeping me stuck inside.

As each day passed and I hadn't gotten an answer from my liver scan, I could feel the light get dimmer and my cancer maze felt never ending.

But then the call came – the call that made me feel like I had a map leading me out of my maze, doors started lifting up and I was finally let free.

The spot in my liver caused some major havoc in my world but who the H-E-double hockey sticks cares ... because with that call I came to find out that the MRI showed it wasn't cancerous! Ahhhhh thank God!!!!

That first breath you let out when you get good news feels almost stolen. Your entire body gets weak as if you were holding up this 100-lb. weight over your head and you've finally been told you could drop it. You feel free! Absolutely freaking free!

You are so used to getting the call that starts with "sorry to tell you this but I have some bad news..." that you then desperately scramble for ways to pump yourself back up to fight. However, this time my doctor's call was different and the call became my release button – my permission to breathe and to keep on breathing!

When you're battling cancer and you hear that your blood results haven't moved since day one of chemo and a scan shows the possibility of a spread, you start thinking, "Come on! Who upstairs doesn't want me down here? Um, God, we need to have a talk!" I'm just playing, but I find I can joke with God when I pray so he doesn't mind that line of questioning.

I've learned so much through all of this and it's so weird how much clarity you can have looking back. I remember back in April 2012 when I first acknowledged the cyst – I was talking to my girlfriends and flat out said, "I'm scared ... I don't wanna do this again. I can't do this again."

I wasn't trying to be dramatic as I honestly felt I didn't have it in me to go through it all again. In 2011, I had finally felt back to my pre-2005 cancer self and then boom, I find out I have to start the whole "cancer thing" all over again ... really?

Overwhelmed but Optimistic

Everything seemed overwhelming, everything seemed too much to take in. The road seemed like this never-ending trail of bad news of things I was scared to do or confront. Realizing your mortality, undergoing more surgeries, coping with the loss of fertility, menopause, and my dreaded relationship with chemo's side effects.

I saw all of the above as an overwhelming and life-altering mountain standing smack dab in front of me. Wishing that cancer mountain wasn't there wouldn't make it go away. I knew that the best way to climb any impossible looking mountain is with small steps not giant leaps. So I tried to NOT combine all of the tasks in my head but instead address the most pressing issues one at a time.

Fertility was my first concern and now I'm happier than I was BEFORE I even had cancer in 2005. I have 10 eggs in some freezer somewhere and no matter what happens in my future no one can take those away from me – they're all mine, dang it, and I will have me some babies!

My situation is not uncommon as we have all been there, standing before what seems an impossible overwhelming battle. We have all gotten to today by pressing forward through our own hardships.

I know some, if not most, of you have experienced getting to the top of your impossible mountain and felt that euphoric rush overcome your body. You can't help but smile with the goofiest grin in the world because you accomplished something you never wanted to do or ever wanted to do again ... but you didn't break. You beat it!

I love the quote, "The strongest steel has to go through the hottest fire." I repeated that quote to myself whenever the questions of "why me?" started to creep into my mindset.

You might not like the cards you have been dealt, but you are who you are because of them. You get a bad hand and it's your choice how you can play it, but I promise if you choose not to fold, you will come out better than you could ever possibly imagine.

The feeling I have right now, at this very moment ... of finally getting my good news is the BIGGEST high in the world and the best reward for all the turmoil of a bad hand.

I want to scream, "I am cancer free!" but second-time-around cancers are a trickier bird. I won't have that specific 100 percent clear moment because of the type of cancer I have. However, that doesn't mean I can't celebrate.

Celebrating My Remission

Would I like to have had some sort of marker or test that showed the chemo fought off everything? Of course! I remember the first time I had cancer, I loved seeing my CA125 blood test numbers go from 500 to 23 by the end of all my chemo treatments because it showed me the progress of it killing the cancer.

Would I like to have a CT scan of my ovary area that showed a change from before and after chemo? Of course! But, as a result of my four surgeries, there is so much scar tissue in that area that a clear ovary scan is impossible.

So although there is no actual test to give me that gives me the 100 percent cancer-free assurance that I had back in 2006, I feel I can celebrate remission just the same. I have done every treatment the doctor has ordered, done every test, every scan and with these clear liver results, I have faith that my treatment worked.

I'm confident in my "cancer-free version" even without a test that exactly proves so. I am celebrating this moment and am ecstatic to say I'm in remission! I may have a few treatments here and there but I'm done with the fear ... I beat the sucker once again!

I know other patients still in their fight can't wait to hear those four glorious words: "You are in remission." Those four lil' words make you feel like you got a new clean slate and are free to do whatever you want in life.

I think of y'all fighting and I promise I'm not just taking my good news liver results and peace out of the patient world. My goal in life has shifted and I want nothing more than to make the road of the patient and the caregiver less ominous. I want to help and I won't stop until I accomplish my goal.

I know how lucky I am and I do not take that for granted! I started a company for patients and their loved ones called MedGift back in 2006 while going through my first battle with ovarian cancer. Now in 2013, I have found things I want to do to make MedGift better and it's all because of the experiences I have had during this second cancer fight. I am on fire with a passion that has never been more intense. I can't wait for y'all to see what I'm up to!

This is my cancer-free version! I am not living in the fear of "What if they didn't get it all?" or "How do they know if there is no test I can do?"

Instead I'm looking out in front of me, clean liver scan in hand screaming, "I'm done! Hello, you beautiful remission you! Now let's go kick some booty because I'm free."

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