To some analysts, yesterday’s move may end up as one of the most significant in Obama’s entire presidency. On NBC Nightly News, Chuck Todd said, “It’s Reagan and firing those air traffic controllers. It’s Truman and the railroads. This is a big moment, pivotal moment.”

Yesterday, Obama also granted an interview to WJBK-TV Detroit, in which he said that “the most important thing we can do is to make sure the auto industry comes out of this difficult process stronger than ever and able to compete, and that’s going to be our top priority.” Asked if that goal could be achieved without a bankruptcy process, Obama answered, “What I’ve said is that I’m confident we can do this…but I think that we are going to have to find some legal tools if all the parties can’t come together to make some of the accommodations and deal with the enormous debt burdens that both Chrysler and GM are dealing with.” Obama added that he wanted affected workers in the auto industry to know “they’ve got a President who is thinking about them every single day. They are my highest priority in this whole process.”

The Detroit Free Press reports Obama “made clear that the limits of federal aid to automakers was within sight, and that deeper cuts among workers, dealers, creditors and suppliers, along with a possible trip through bankruptcy court, would be needed for the automakers’ survival.” The Detroit News notes the President “sought to reassure consumers and workers that bankruptcy, if required, would be brief.”

The CBS Evening News reported “the rejection of the GM and Chrysler restructuring plans helped send stock prices sharply lower today. The Dow plunged more than 250 points. The NASDAQ lost 43.” On ABC World News, George Stephanopoulos said, “Bankruptcy is very much on the table right now and Administration officials tell me it’s likely the leading option.”

The Washington Post reports “the president’s aggressive move against GM has left some banking executives wondering whether they are next in line.” The Politico reports that under Wagoner, “General Motors and its political action committee gave twice as much to Republicans as they did to Democrats.” From 2000, “when Wagoner took over…through the end of last year, GM and its PAC contributed $1.7 million to Republican candidates and committees, compared only $815,000 to Democratic ones.”

“I will continue to monitor the situation carefully,” he pledged. “We will do what must be done to help.”

Obama also implored residents of North Dakota, South Dakota and Minnesota to be vigilant in reading flood-condition reports and to follow instructions from federal, state and local officials should evacuation be necessary. He repeatedly praised volunteers stockpiling sandbags and building levees, saying “their service isn’t just inspirational — it’s integral to our response.”

In North Dakota, Fargo’s fears of a catastrophic flood eased Saturday with word that the Red River apparently crested at lower-than-expected levels, and weary residents turned their attention to ensuring their hastily built levees hold up against an onslaught of ice-laden water expected to stay high for at least a week.

Obama was spending the weekend at Camp David before leaving Tuesday for a nearly week-long European trip to address the global economic crisis with leaders of other world powers. But aides stressed that he was being kept abreast of the Midwest flooding despite being away from the White House.

In office just two months, Obama and his team no doubt are mindful of the Bush administration’s bungled response in August 2005 to Hurricane Katrina, which devastated the Gulf Coast and highlighted the country’s racial and economic divisions. George W. Bush’s popularity took a beating in Katrina’s aftermath, and the hurricane has been held up ever since as a symbol of the federal government’s incompetence.

Obama used his weekly address to go to great lengths to describe all that the federal government has been doing as bulging rivers and streams threatened Midwest communities over the past few days. Aides said federal, state and local officials have been coordinating for more than a week.

Over the past few days, Obama signed emergency and disaster declarations for North Dakota and Minnesota, triggering federal support to help state and local officials who already had efforts underway. On Saturday, he indicated that help for South Dakota could come soon, saying his aides were “keeping close watch on the situation” there.

The Homeland Security Department and the Federal Emergency Management Agency were coordinating the federal response.

Obama said the U.S. Army Corps of Engineers, the Coast Guard, the Defense Department, the National Guard and the Health and Human Services Department, as well as the American Red Cross, were involved.

“At moments like these, we are reminded of the power of nature to disrupt lives and endanger communities,” Obama said. “But we are also reminded of the power of individuals to make a difference.”

On that note, he reaffirmed his support for legislation Congress is expected to send to him in the week ahead that would give tens of thousands of people more opportunities to mentor children, clean parks and help the poor, a sweeping call to national service in a time of need.

Source : USA TODAY

That money would be in addition to the civilian aid — $1.5 billion a year for five years — that the president called for Friday.

A defense official, who spoke on condition of anonymity, told FOX News the money will be dedicated exclusively to “equipping, training, and building infrastructure directly related to counterinsurgency operations.”

Gen. David Petraeus told FOX News in an interview Monday the plan will be called the “Pakistani Counterinsurgency Capability Fund”.

Officials were quick to point out that U.S. commanders would have control over how the money is spent, and that none of it would be spent in a way that would give Pakistan a greater capacity to attack another country, such as India.

The money would be distributed over five years, with the first $400 million of it added to the fiscal year 2009 supplemental request for war fighting. Another $700 million would be in the fiscal 2010 base budget. Then $575 million would be spent each year from fiscal 2011 through 2013.

In his speech on Friday, President Obama described Pakistan’s lawless border region as “the most dangerous place in the world.”

Candidate Obama promised Americans a fresh start with the rest of the world, after eight years in which former President Bush’s policies and style made this country deeply unpopular abroad. Before he was even serious about running for president in 2008, Obama had concluded from the reaction he received on a trip to Africa in the summer of 2006 that his election had the potential to change instantly international perceptions of America.

That seems indisputable. As a leader Obama is significantly more popular overseas than Bush ever was. The question is whether Obama has a strategy in mind to leverage that popularity to bend recalcitrant allies in directions he would like them to go, whether that means producing a coordinated response to the international economic crisis or winning concrete support for his new policies for Afghanistan and Pakistan.

Implicit in Obama’s campaign rhetoric was that he would seek cooperative relationships with America’s allies, rather than pursuing the unilateral style that often marked Bush’s approach, particularly in his first term. Stylistically that should make him a more appealing U.S. leader to his counterparts in Europe and elsewhere. Substantively, it leaves considerable power in the hands of U.S. allies to resist measures Obama may be advocating, unless he proves to be powerfully persuasive in both public and private venues.

Last summer, Obama got his first taste of this when he took his week-long trip to Iraq, Afghanistan, the Middle East and Europe. Because he was there as a candidate, he was not selling a particular set of policies. Mostly he was trying to make a good impression on leaders with whom he might be dealing and to win an election back home. But at the end of the trip he talked about the potential value of having a president who enjoys the good will of publics in countries around the world.

One of the central debates of the campaign, he said, was over which candidate was best positioned to forge coalitions that could successfully deal with big issues, from terrorism to climate change to the economy. “What I thought was useful was to give the American people some sense of how I was approaching these issues, but also to give them a sense that the world can be responsive to this approach and that it will make a difference,” he said that week.

At the time, he used Afghanistan as an example of how an Obama presidency might succeed where Bush’s had failed. He was already advocating the need to send more troops to Afghanistan and for troop support from other countries. Leaders in those countries, he argued, would be more likely to cooperate if their constituents were more favorably disposed toward the United States and its president.

“Anti-American sentiment is not useful even when we’ve got strong allies like [German Chancellor Angela] Merkel and [French President Nicolas] Sarkozy, who are pro American and favorably disposed and don’t engage in, you know, sort of taking cheap shots at us. They’ve been great allies. But we put them in a tough bind if we’re not attentive to their constituencies. So I wanted to give voice to that very practical, hard-headed approach to foreign policy.”

Obama’s July trip was a trial run. There was no political payoff likely at the time. The only real risk was that he might commit a gaffe that would undermine his hopes of winning the presidency.

His advisers argued at the time that the real value of spending a week abroad in the middle of a campaign would come only if he won the election. He would start his presidency having taken the measure of a number of key world leaders (and they of him) and would need no on-the-job training once in office.

All of that will be put to the test this week, under circumstances that are significantly different than they were last summer, given what has happened to the world economy. It should be easy for Obama to escape any blame among Europeans for Bush’s national security policies. He can begin his Afghanistan policy with a relatively clean slate – though that will not assure that European allies will step up.

On the economy, it will be less easy for Obama to insulate himself from anger abroad that American-style capitalism (and lack of government regulation) trashed the world economy, though European-style capitalism (and government) bears responsibility for the current crisis as well. Obama may bear no direct responsibility for what happened before he came into office, but perceptions of cowboy capitalism may complicate his ability to forge the kind of consensus or coalition he talked about last summer.

Obama has demonstrated that he can command attention on the world stage and no doubt will do so again this week. How much that attention translates into influence on the other leaders with whom he will be meeting will determine whether the president’s first big foreign journey meets the expectations he set as a candidate.

In contrast to the Free Press and New York Times, Detroit News reports, “Most industry insiders were not entirely surprised, given the political mood.” Similarly, USA Today reports Wagoner’s “opposition to bankruptcy as an option for GM could have played a factor in his ouster.” In a front-page article, the Financial Times reports that a person close to GM said that “the government intervention made it likely GM would file for bankruptcy protection sometime in the next few weeks.”

On CBS’s Face The Nation, President Obama said, “We want to have a successful U.S. auto industry, but it’s got to be one that is realistically designed to weather this storm and to emerge at the other end much more lean, mean and competitive than it currently is. And that’s going to mean a set of sacrifices from all parties involved.”

In a front-page article, the Washington Post reports that the Administration “said yesterday that it would withhold additional federal aid to the auto industry unless the ailing companies undertake changes they so far have been unwilling or unable to make.” Similarly, in a front-page article, the Wall Street Journal reports that, in “one of the most dramatic government interventions in private industry” during this economic crisis, “the Obama administration used the threat of withholding more bailout money to force out” Wagoner.

The AP reports, “If a Chrysler-Fiat union cannot be completed, Washington plans to walk away” and “leave Chrysler destined for a complete sell-off. No other money is available.” In a front-page article, the Washington Times reports the Administration “is prepared to escort both companies through a kind of quick bankruptcy procedure that senior officials described as ’surgical’ and may take no longer than 30 days.”

The Politico reports “Industry sources had said the White House planned very tough medicine in Monday’s announcement.” The Detroit News reports, “Obama told four key Michigan members of Congress during a Sunday night conference call that he would grant unspecified additional aid to GM for 60 days and Chrysler for 30 days, according to a person familiar with the call.”

The New York Times reports the Obama Administration went into sales mode on Sunday, with President Obama and a number of senior economic and military leaders blanketing the morning talk show circuit to advance the administration’s efforts on the economy and the war in Afghanistan.”

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Former President George Bush [Images] left for Obama a bleeding stalemate with no end in sight. As a descriptive analysis of the kind of situation in the Af-Pak region inherited by him from Bush, Obama’s new strategic broth to which many cooks have contributed, has shown a clear understanding of the problems confronting him in this region. Bush and his advisers were not as articulate as Obama and his advisers are and not as word-smart, but they too had come to a similar conclusion though not in as smart a language.

Their conclusion was: Pakistan is the source of the plethora of problems faced in the region and unless and until that source is tackled effectively the bleeding will continue.

Obama and his advisers suffer from the same prescriptive deficiency as their predecessors. This deficiency arises from their tendency to mix facts with illusions. The facts were as clear to Bush and his advisers as they are now to Obama and his advisers. These are the existence in the Pakistani territory of the sanctuaries of Al Qaeda [Images], the Pashtun Taliban [Images] and the Punjabi Taliban organisations with the Lashkar-e-Tayiba [Images] and the Jaish-e-Mohammad in the forefront and the role of the Pakistan army [Images] and its Inter-Services Intelligence in nursing them to serve what they perceive as Pakistan’s strategic interests.

The prescriptive part of Obama’s strategy is as full of illusions as the strategy of Bush was. There is a common root cause for the illusions of the two administrations. The root cause is their inability to understand that the Pakistani military-intelligence establishment has convinced itself that Pakistan, which had lost its strategic relevance in the immediate aftermath of the end of the cold war, has acquired a new strategic importance. This is thanks to the terrorists of various hues operating from its territory and its nuclear arsenal. The continued existence of these terrorists is in its interest. Action against terrorism when unavoidable, support for terrorism when possible. That is its policy.

It has been using its nuclear arsenal not only in an attempt to intimidate India and deter it from retaliating for terrorist strikes in Indian territory, but also to deter the US and the rest of the West from exercising too much pressure on it to deal with the terrorist sanctuaries in its territory.

Unless the mind of the Pakistani military and intelligence officers is disabused of this belief and they are made to co-operate with the international community in destroying the terrorist infrastructure in its territory, no strategy is going to work in ending jihadi terrorism bred in Pakistan. The major deficiency in the prescriptive analysis of Obama arises from his naive assumption that Pakistan can be made to co-operate more effectively against terrorism through a basket of incentives — more military and economic assistance, more training, an emphasis on the continuing importance of Pakistan even after the war on terrorism is over etc.

Bush too hailed Pakistan as a frontline ally in the war against terrorism and provided it with various lollipops — over $10 billion in military and economic aid since 9/11, dual-use weapons and equipment which could be used against the terrorists as well as against India and a willingness to close the eyes to Pakistan’s sins of commission and omission against India so long as it acted against terrorism directed at the US. These lollipops failed to make the regime of Pervez Musharraf [Images] co-operate sincerely against Al Qaeda and the Taliban. These incentives could not prevent the Neo Taliban of Afghanistan from staging a spectacular come-back from sanctuaries in Pakistan and Al Qaeda and its associates from organising acts of terrorism in different parts of the world.

The lessons from the failure of the strategy of Bush were: Firstly, a policy based only on incentives will not work in the case of an insincere state such as Pakistan. Secondly, a policy which makes a distinction between terrorism directed against the US and terrorism directed against India and the rest of the world will be ineffective.

Thirdly, the fear of exercising too much pressure on Pakistan lest the state collapse and its nuclear arsenal fall into jihadi hands is exploited by Pakistan to prevent the ultimate success of the war against terrorism.

One was hoping — on the basis of the statements by him during his election campaign — that Obama would have factored these lessons into the formulation of his new strategy. Surprisingly, he has not. The same old policy of incentives and nothing but incentives is sought to be pursued under the garb of a so-called new strategy. The only new feature is the emphasis on the benchmarks of implementation which will determine the continued availability of the incentives to Pakistan at every stage. The only disincentive with which Pakistan has been confronted is the risk of the incentives drying up if it is seen as dragging its feet in its co-operation in the fight against terrorism.

Obama’s strategy — like the one of his predecessor — is marked by a fear of punishing Pakistan if it does not change its policy of using terrorists to advance its own strategic agenda. The reluctance to punish Pakistan if it continues to be insincere in dealing with terrorism originating from its territory arises from the fear that too much pressure on Pakistan and a policy of punitive measures might push Pakistan into the arms of the jihadis or might result in a collapse of the Pakistani state with unpredictable consequences. The US must rid itself of this fear and make it clear to Pakistan that, if the worst comes to the worst, the world is prepared to face the eventuality of a failed Pakistan. A failed Pakistan may be a disaster for the people of Pakistan, but not necessarily for the rest of the world.

It is important to constitute a contact group to work out alternative strategies with incentives as well as disincentives, with rewards as well as punishments. Such a contact group must be only of the victims of terrorism. A contact group, which seeks to bring together the victims of terrorism as well as the perpetrator, will be a non-starter.

Obama’s strategy has three components — a counter-insurgency component for Afghanistan, a counter- terrorism component for use in Pakistan and a counter-radicalisation component for use in the entire Af-Pak region. It is a mix of military and political measures. While the military measures will be largely implemented by the US and other NATO powers plus Australia [Images], the regional role of countries such as India, China and Iran is sought to be restricted to the political component. They will have no say in the way the military measures are implemented.

The US expectations that the international community will co-operate in implementing the unilaterally worked out US strategy can be belied because the strategy offers no end in sight to the wave of terrorism of Pakistani origin faced by them. This is particularly true of India. Even though the strategy projects Al Qaeda and its associates operating from sanctuaries in Pakistan as posing a threat to the world as a whole, its objective is limited to preventing another 9/11 in US territory mounted from this region. It does not pay equal attention to the concerns of India and other countries. The strategy is, therefore, unlikely to excite professionals in India.

Obama argued for a long term economic outlook, “We must make strategic investments that will serve as a down payment on our long-term economic future. We must demand vigorous oversight and strict accountability for achieving results. And we must restore fiscal responsibility and make the tough choices so that as the economy recovers, the deficit starts to come down. That is how we will achieve the number one goal of my plan – which is to create three million new jobs, more than eighty percent of them in the private sector.”

Making a long term argument to members of Congress who are prone to only thinking ahead as far as their next election is a tough sell. What I think will put this package over the top is emphasis on job creation and tax cuts. Many of the things that Obama wants in this package, middle class tax cuts, infrastructure spending, alternative energy, and electronic medical records are parts of bills that came close to passing in the last administration.

There is a great deal of pressure on members of Congress back in their districts to do something for their constituents. Americans watched in anger and frustration as Wall St. and the financial sector got bailed out as they lost their homes and jobs. The American people will favor this package to the same degree that they despised the various corporate bailouts.

Getting this legislation passed quickly will get the Obama administration off on the right foot. However, Congressional Republicans do have a valid point, in the respect that with a package this big, there should be time for debate. We have seen the government rush in and throw money at problems with poor results too many times. Let’s think this one through, because there is too much at stake for us to allow history to repeat itself again.