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Special Update #11

November 29, 2001


While the war has gone exceedingly well, the process of installing a viable new government will be neither brief nor easy. The Afghan people are made up of dozens of different tribes. People in these many tribes are fiercely loyal. Some have different faiths; others have widely differing views of the same faith; so much so in many cases that they HATE each other. In some instances, it is forbidden to be seen with a member of another tribe.

The only thing these tribes hate more than each other is ANY foreign power that tries to control or influence their nation. Both the British and the Soviets found out the hard way. We were lucky that the weapons we have today are vastly more sophisticated, and we were able to prevail without using large numbers of ground troops (at least so far).

But the question is, what kind of government should be put in place? Is there any form of government that can accommodate the large number of tribal factions, many of which hate each other? A puppet government established by the West surely will not stand for long.

I don't know the answer, but we should not be surprised if US forces are in Afghanistan for a long, long time. I have attached a couple of good articles on this below (the first two).


As you are no doubt aware, the debate is bubbling over whether Iraq is next on the war list. The President, Donald Rumsfeld, Colin Powell and Condi Rice will not say, one way or the other, about our plans for Iraq. Bush offered Saddam a way out if he would allow UN weapons inspectors back into Iraq. He refused, of course.

The question now is probably not IF but WHEN. And HOW? Richard Perle, chairman of the Defense Policy Board and one of Bush's closest advisors broke the silence last week and told NewsMax that Iraq should be next on our hit list, and that Saddam Hussein should be removed "VIOLENTLY."

There is no question that if we attack Iraq we will lose support from several coalition members. Naturally, the Arab states are opposed to an attack on Iraq. It will be interesting to see if Saudi Arabia kicks our troops out. We'll see. From everything I read, the Saudi government is living on borrowed time anyway, so it may not matter -- unless they side with Iraq.

I have attached four good articles on the Iraq question below, including one from Dick Morris. [Some of you may be offended that I include articles from Dick Morris, the former political advisor to Bill Clinton. Let me assure you, I don't care for the guy either, but it is good to get his insights from time to time as one who has been inside the White House.]



The war in Afghanistan remains the dominant media focus. President Bush's approval ratings remain very high. Outwardly, the Democrats remain united in their support of the war on terrorism. The general public seems content to believe that both parties are working arm-in-arm to support the war and revive our struggling economy.

But nothing could be further from the truth! Senate majority leader TOM DASCHLE (Dem.- SD), in particular, and other Democrats are seeking to undermine the Bush administration on numerous fronts. Some of these actions are not only despicable, but are un-American.

President Bush has asked Congress to pass three main items before it adjourns for the year: 1) an economic stimulus bill; 2) a new energy package; and 3) trade promotion authority. Mr. Daschle has so far refused to negotiate on any of them. Instead he is moving ahead with a LOW PRIORITY FARM BILL the White House opposes, and a railroad retirement bill that is vital to no one but the AFL-CIO. The farm bill is nothing less than a PAYOFF to Senator Jim Jeffords of Vermont. Jeffords, you will recall, is the former Republican who turned Democrat earlier this year, which shifted the control of the Senate to the Dems and made Daschle the Majority Leader.

So the farm bill is simply PAYBACK time. It will, on average, raise the cost of a gallon of milk by as much as 26 cents. The current farm subsidies don't expire until next October, yet this is a PRIORITY?? Paying Jeffords back for his defection and lining the pockets of dairy farmers in Vermont is apparently more important than salvaging the economy, reducing our dependence on foreign oil and financing the war on terror! But if you are Tom Daschle, remaining in power is more important than anything else!! For him, it is doubly good if it also undermines President Bush.

On Tuesday, Daschle announced, "I don't know that we'll have the opportunity to call up an energy bill until next year." You would think that after 911, US energy production would be a war priority. In September alone, the U.S. imported 1.2 million barrels of oil a day from IRAQ, which we soon may be fighting, the highest rate since just before Saddam Hussein invaded Kuwait in 1990.

But Daschle is blocking a vote on the energy bill precisely because he knows Alaskan oil drilling HAS THE VOTES TO PASS. That's why he pulled the bill from Senator Jeff Bingaman's Energy Committee when he saw it had the votes. So much for the new spirit of Beltway cooperation!

As I have commented before, the bipartisanship after 911 was certain to crumble. But what's striking now is that Daschle is letting (perhaps encouraging) his liberal cronies in the Senate break even the agreements they've already made with the White House. For example, President Bush shook hands weeks ago with Ted Kennedy on an education deal, but now Kennedy is insisting on increasing the spending significantly before he'll sign on. Daschle is letting Ted have his way.

The same goes for the $686 billion annual spending limit that Democrats struck with Bush after September 11. That's a 7% increase from a year earlier (since padded by a $40 billion bipartisan stimulus package). Democrats made a big public fanfare when Bush signed this large spending bill into law. Because Bush supported it, the Dems felt that they would not be labeled as "big spenders" by the Republicans. But now, Daschle is using the issue AGAINST Bush, refusing to even discuss an economic stimulus bill unless West Virginia Democrat Bob Byrd gets his demand for ANOTHER $15 billion in pork-barrel domestic spending.

Byrd is a former majority leader who thinks of Mr. Daschle as his junior partner. If he doesn't get his spending approved in other ways, he is threatening to attach his wish list to the Defense spending bill, apparently with Daschle's good wishes. That would force Bush to either veto the bill and forfeit much-needed money for defense, or sign it and swallow Byrd's mega-pork for Amtrak and Alaskan airport subsidies.

"All of this suggests that Daschle is only too happy to see NO stimulus bill at all. He knows the party holding the White House usually gets most of the blame for a bad economy, so by sabotaging the extra stimulus package his Democrats can perhaps pad their Senate majority next year. This also allows Daschle to make good on his political payback to Jeffords. Isn't that SPECIAL!"

This is the same strategy that former Democratic leader George Mitchell pursued in blocking a tax cut during the early 1990s and then blaming George H.W. Bush for the recession. Mr. Mitchell's understudy at the time? Tom Daschle.

Even some Republicans have helped Daschle's guerrilla campaign. Alaska's Ted Stevens, Bob Byrd's bosom spending buddy, pounded White House budget director Mitch Daniels for daring to speak the truth about his pork-barrel spending initiatives. And when it came to nationalizing airport security workers, in another huge union-controlled bureaucracy, GOP leader Trent Lott and many other Republicans were virtually silent. They did not introduce any other option short of creating another huge government takeover, and most voted in favor of the airport security bill.


The issue now is whether Mr. Bush will continue to let himself get pushed around. Daschle is behaving badly because he's assumed the President won't challenge him for fear of losing bipartisan support on the war. But this makes no political sense. As long as Bush's war management is popular, Daschle won't challenge him on foreign affairs.

The greater risk to Mr. Bush's popularity and success isn't from clashing with the Daschle Democrats over tax cuts or oil drilling. It's from giving the impression that on everything but the war, Tom Daschle might as well be President.

I would like to see Bush call a press conference and explain to the American people just what a POLITICAL HACK Daschle is. Bush has the perfect backdrop for such an act of honesty. After all, Bush was the one who embraced the Democrats when he took office and promised a bipartisan administration. You will recall that, in addition to others, he even invited the rival Kennedy family to the White House for dinner and a private movie ("13 Days").

Yet these people will do anything to undermine Bush, and even the war and national security, if it furthers their hold on power. If I were Bush, I would say something like this:

"My fellow Americans, I cannot tell you how much I appreciate your overwhelming approval for the war on terrorism. It has been precisely this outpouring of support and patriotism which has made the Democrats stand with me on the war effort. However, while we have all been rightly focused on the war and our great successes in Afghanistan, certain members of the opposing party have been trying to undermine my efforts to increase national security.

For example, I have asked for a new energy bill that would allow us to significantly reduce our dependence on foreign oil, including limited drilling in the ANWAR (Alaska). The bill has the votes to pass, but Majority Leader Tom Daschle has single-handedly blocked the measure from a vote.

In addition, I have asked for a new Defense spending package to bolster our military and finance the war on terror. Mr. Daschle and his liberal friends are now threatening to either block that vote as well, or if not, they intend to attach tens of billions in pork-barrel spending to the defense bill, and I may have to veto it.

Rather than help me pass these two vital measures and others, Mr. Daschle and his colleagues have instead spent their time pushing a new farm bill sponsored by Vermont Senator Jim Jeffords. You will recall that Mr. Jeffords defected from the Republican party earlier this year to side with the Democrats. Perhaps this is why Mr. Daschle and others feel obligated to pass an unnecessary farm bill rather than my initiatives to increase national security and pay for the war on terror.

The bottom line is, I need your help. Let your Congressmen and women know that you want national security increased. Let them know you want our military supported. And finally, let them know that you believe it is un-American not to."

Seriously, I do not know why Bush should not do this NOW. Daschle met with Bush twice this week in the Oval Office, and both times it was reported that he INSULTED the President by basically saying . . TOUGH! Bush should take Daschle to the woodshed before the American people. He should do it NOW! And the good people of South Dakota should elect a Senator who will put the good of our nation ahead of his own political hold on power!!

[Can you imagine what Clinton would have done if he had such high approval ratings and was being road-blocked by the Republicans? He'd be on TV every night if need be!]




You've no doubt noticed the outcry over President Bush's Executive Order re-instituting military tribunals to prosecute terrorists. Military tribunals have not been used since WWII. Both those who favor military tribunals, and those who don't, have some very good arguments. Rather than trying to summarize them, read the articles below. Arch conservative Rush Limbaugh made a great case in support of the tribunals -- a must read below. Democrats are gearing up to fight the President and Attorney General John Ashcroft on this. And even the conservative CATO institute is against Bush on this.

As I often do, I consulted my bright libertarian friend (who I have quoted before in these Updates) about the use of military tribunals. Here's what he said:

"I'm still uneasy about the tribunal thing. The FDR comparison is apt, but there is a key difference: Congress had actually declared war in that case. This time all they have passed is a vague resolution saying military action is necessary. It is not clear if this gives Bush the sweeping wartime powers FDR had.

People also seem to forget that the Bill of Rights applies to all persons within our borders, citizen or not. Even illegal aliens have Miranda rights, etc. Yet Bush's order allows perfectly legal US residents (foreigners in our country) to be arrested, tried, and executed by tribunals. When and if tribunals are used, I fully expect a flurry of litigation. It will be interesting to see how the courts rule. I'm not sure they will accept the precedents Ashcroft is citing.

As for detaining people, I see Ashcroft's point about preventing other attacks but where does this end? Based on crime statistics, we could lock up all black males between 15 and 30 and probably cut the crime rate dramatically, too. By Ashcroft's logic, this would be a good thing. But I haven't heard him suggest it.

On a purely political note, Bush could have avoided the whole controversy by asking Congress to authorize the tribunals. They would have done so immediately, given the public mood right now, and then Leahy et al would be unable to snipe from the sidelines. Then issue orders (unofficially, of course) to Delta Force that Bin Laden and associates WILL be KILLED while resisting capture. That will render tribunals unnecessary."

Like I said above, all sides in this debate have very strong arguments. I tend to favor them for the following reasons:

1. The tribunals are only for NON-CITIZEN war criminals/terrorists.

2. Holding trials in the US courts would require testimony to be aired in public, some of which is classified or sensitive information. The bad guys would love it.

3. The fact that a terrorist is on trial would, itself, make the court a target for a terrorist attack. This would place the public at risk.

4. The military tribunals ordered by Bush fall far short of what FDR did in WWII.

5. Finally, even if we did try to handle these cases in US courts, there are not enough federal judges to handle the caseload, thanks to certain Democrats who continue to stall Bush's judicial selections.

For those of you who may not be aware, there are more than 100 federal judicial vacancies, including 38 of which have been classified as "emergencies" by the U.S. Judicial Conference. Only about a fourth of Bush's nominees have been approved. Four of 12 seats remain vacant on the D.C. Court of Appeals.

Here, once again, we see the un-American hand of TOM DASCHLE. He has the power to allow hearings for Bush's appointees and to have them voted on, one way or the other. But because he knows they are very likely to be approved, he has blocked the process altogether. Yet he is one of those Democrats who are opposed to the military tribunals! What else is new?

Finally, Americans approve of military tribunals in large numbers. See the story below, along with Rush Limbaugh's article and the opposing views.



Mike Posey is a vice president here at ProFutures. He offers the following after watching CNN this morning at the nearby gym where he works out:

"Good ol' Paula Zahn was in typical left-wing journalist form this morning on CNN while I was working out. First, they ran the story of the first U.S. casualty of the war. This brave CIA operative was killed in the prison uprising last Sunday. They ran a clip of his father speaking, and he spoke about how proud he was of his son and that he was a hero.

Then, Zahn went to the on-site reporter and wondered out loud if, now that casualties were a reality, would the American people's support of the war diminish. She also queried the reporter about any frustration with the Pentagon that may have been expressed by the family, since the Taliban prisoners were not searched when they surrendered. The on-site reporter said no one had said anything about it.

She then had one of the instant-expert retired generals on, and asked him the same thing - as in, didn't the Pentagon drop the ball when the prisoners were not searched. To his credit, the retired general reminded her that the Northern Alliance were the ones who took the prisoners, not U.S. troops. He further stated it was their war, not our war, and that the Pentagon cannot be held responsible for lapses in the Northern Alliance's taking of prisoners.

Next, she had Attorney General Ashcroft on, supposedly to discuss the new stance that foreign nationals (read Arabs) would not face being deported if they can come forward with information that would help in our fight against terrorism. Of course, Zahn quickly went to the issue of some 600-odd Arabs who are still being detained. She quoted a statistic that only 12 had furnished any information so far, and so she asked Ashcroft if he was pleased with that ratio.

Ashcroft wisely sidestepped the question and said that the ones still being held had some tie to bin Laden, and the fact that no additional terrorist attacks had occurred should show that keeping these people detained was a good decision. He said that he had no doubt that, had these people not been detained, additional attacks would have been at least attempted.

Not to be denied, Zahn went back to the 12 that supposedly had furnished info. Ashcroft said he would not confirm any number of informants. However, it is clear that these left-wingers just don't get it. Do they think that if someone doesn't give information, that they are innocent? Have they never heard of refusing to talk? What idiots!

Just as sure as I'm sitting here, had we released most of these characters and they had carried out another attack, Zahn would have been asking Ashcroft why he didn't keep them longer, since they had ties to bin Laden.

Of course, Zahn just couldn't resist at least one mention of the military tribunals, and that Bush was receiving criticism from both sides. Zahn asked Ashcroft under what authority Bush could order such tribunals to occur. Ashcroft did a great job. He must have mentioned FDR a half-dozen times, and made sure to say that Bush's order didn't go anywhere near as far as FDR's in WWII. He also continued to stress that these tribunals were for non-citizen war criminals, along with all of the other reasons a criminal trial would not work. I wish he had mentioned the lack of federal judges to handle the cases due to the Democrats trying to block Bush's picks, but he didn't.

Then, to top it all off, Zahn had a love-fest with Sen. Hillary about women's rights in Afghanistan. Evidently, the good Senator is holding a hearing about this soon, in which Afghani women who escaped the Taliban would be speaking. The gist of the whole thing seemed to be that the Taliban was bad, but so is the Northern Alliance as far as women's rights are concerned. What galled me is that Zahn described what Laura Bush had done to speak out for women's rights in Afghanistan, and then asked Hillary what more she might have done had she still been first lady faced with this issue. Who cares?? All Hillary said was that she and Madelyn Albright spoke out against recognizing the Taliban during the Clinton Administration. Gee, like it was their decision to make!

I now realize why they have CNN (Clueless News Network) on now in the gym. It makes you want to try to run and turn off the set, which results in good exercise."

Thanks, Mike! You would think the CNN executives would realize that their obvious liberal bias is turning off their audience. FOX News, for example, has been cleaning CNN's clock for over a year now. Remember, for the last eight years we called it the CLINTON News Network.

Speaking of Clinton, there are some good articles below on Bill & Hill.

Since this is a long Update, I will close for now. Next time, we'll look at the economy and the markets. Not a lot has changed since my last Update anyway.

Wishing You Holiday Spirit,

Gary D. Halbert


New government in Afghanistan

More on new Afghan government

Afghanistan is just the beginning.

Bush advisor calls for toppling of Saddam.

Pentagon gears up to bomb Iraq.

Iraq says no to inspectors.

Morris says on to Baghdad!

Bush needs to get tough with Daschle.

Stimulus bill goes nowhere.

Rush Limbaugh on military tribunals

Americans back Bush/Ashcroft anti-terror tactics.

Why is Ashcroft drawing stiff opposition?

More on military tribunals

Democrats prepare to fight Bush on tribunals.


Media elite hate George W.

Senator Patrick Leahy's loose lips!

Hillary snubbed trade center victims.

Weinberger blasts Clinton for terrorism.

Hillary to hand pick Pardongate prosecutor.

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Forecasts & Trends E-Letter is published by Halbert Wealth Management, Inc. Gary D. Halbert is the president and CEO of Halbert Wealth Management, Inc. and is the editor of this publication. Information contained herein is taken from sources believed to be reliable but cannot be guaranteed as to its accuracy. Opinions and recommendations herein generally reflect the judgement of Gary D. Halbert (or another named author) and may change at any time without written notice. Market opinions contained herein are intended as general observations and are not intended as specific investment advice. Readers are urged to check with their investment counselors before making any investment decisions. This electronic newsletter does not constitute an offer of sale of any securities. Gary D. Halbert, Halbert Wealth Management, Inc., and its affiliated companies, its officers, directors and/or employees may or may not have investments in markets or programs mentioned herein. Past results are not necessarily indicative of future results. Reprinting for family or friends is allowed with proper credit. However, republishing (written or electronically) in its entirety or through the use of extensive quotes is prohibited without prior written consent.

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