GOP advisor: 'Let the fiscal cliff happen'

As politicians, businessmen and ordinary citizens brace for spending cuts and tax hikes in the new year, a long-term Republican advisor says the U.S. should take the "fiscal cliff" plunge.

"Let the fiscal cliff happen and reduce the deficit very substantially as a consequence,"says Bruce Bartlett, author of The Benefit and Burden: Tax Reform--Why We Need It and What It Will Take. The combination of spending cuts and tax hikes will eventually strengthen the economy he says, citing CBO analysis.

In contrast, Republicans' refusal to raise taxes would hurt the economy in the long run, Bartlett argues.

Related: Higher Taxes Will Create Jobs and Cut the Deficit: David Cay Johnston

Bartlett, a former advisor to Presidents Ronald Reagan and George H.W. Bush and Congressman Ron Paul, explains why the GOP tax pledge has harmful consequences for the economy. Government spending will rise over the coming decades as more baby boomers retire. But if tax revenues don't keep pace with spending, the federal government will be forced to increase borrowing, which will increase interest payments on the debt.

According to Bartlett, a GAO report projects that the Republican plan to keep revenues at just under 18% of GDP will cause interest on the debt to surge from 19.2% of the deficit this year to 62% in 2020.

Related: Fiscal Cliff Deal Likely but U.S> at Risk of "Looking Ridiculous," Rivlin Says

Bartlett is not advocating big spending increases --- he'd rather trim spending-- but he says revenues must keep up with spending. Going over the fiscal cliff is a move in that direction because revenues would rise as the Bush-era tax cuts expire for everyone, not just the top 2%, at the same that spending is reduced.

"Revenues are too low rather than spending too high," he tells The Daily Ticker's Aaron Task.

Bartlett doesn't know if and when Republicans and Democrats will agree to fiscal cliff deal, but he predicts that any deal will not happen "before the absolute last possible minute." Stay tuned.

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Panetta in Afghanistan to meet with Karzai

KABUL, Afghanistan (AP) — President Barack Obama will decide shortly how many U.S. troops he wants to keep in Afghanistan after the U.S.-led coalition military mission ends in December 2014, Defense Secretary Leon Panetta said Wednesday as he opened two days of consultations with top U.S. commanders and Afghan President Hamid Karzai.

Panetta offered no clues to what Obama may decide, but other officials have indicated the White House is considering plans that call for between 6,000 and 10,000 U.S. troops to stay for several years after 2014 in order to keep Afghanistan on a path toward stability and to prevent al-Qaida and affiliated terrorist groups from re-emerging as a significant force here. The U.S. now has about 66,000 troops here, along with about 35,000 from allied nations.

Obama also must decide how quickly to reduce the U.S. force from 66,000 to whatever post-2014 level he deems necessary and Karzai considers acceptable.

White House officials said the president's decision on both matters was not expected before the end of the year. His announcement could be timed to a meeting with Karzai in Washington early in 2013. The Afghan leader said last month that he had accepted Obama's invitation to visit the White House "at his earliest convenience."

Panetta had dinner with Gen. John Allen, the top coalition commander, as well as other senior commanders, and he was scheduled to meet with Karzai on Thursday.

Allen, who is under investigation by the Pentagon's inspector general for possibly inappropriate correspondence with a Florida woman linked to the David Petraeus sex scandal, met Panetta upon his arrival at the Kabul airport. Allen did not talk to reporters.

Before the dinner, Panetta had a one-hour meeting with Allen and other senior military officers. Panetta told the commanders he would be meeting with Afghan leaders to "try to tee up" the decisions Obama will have to make on future U.S. troop levels, according to media in the room before the meeting started.

Obama is currently reviewing options for what the U.S. mission might look like after 2014. But the White House has not yet asked the Pentagon for proposals on the next phase of the drawdown in 2013.

Panetta's visit comes at a difficult juncture in the Western coalition's efforts to shift more security responsibilities to Afghan forces so the combat mission can end without a Taliban resurgence. While security has generally improved this year, Afghan forces still lack some important capabilities and the government's ability to effectively govern beyond Kabul and to root out corruption is in great doubt.

Maj. Gen. Lawrence Nicholson, the coalition's deputy chief of staff for operations, said in an interview with reporters traveling with Panetta that coalition commanders are pushing the Afghans to do more on their own. The idea is to push them "right to the brink of failure" so that they are ready to handle the Taliban once they no longer have large numbers of international troops to support them.

"What we say is we want them to see failure, we want them to smell it, we want them to taste it, we just don't want them to achieve it," Nicholson said. "We will push them as far as we can to be self-sufficient."

Painting an optimistic picture, Nicholson said the effort to develop capable Afghan forces has evolved from an arrangement in which most combat operations were partnered or conducted with Afghan and coalition forces fighting together to one in which the U.S. and allied troops are merely "enabling" the Afghans by providing support, such as medical evacuation of their wounded as well as artillery support, bomb disposal and equipment to clear roads of homemade bombs.

The idea, Nicholson said, is to make the Afghan army and police almost entirely self-sufficient by the time the U.S. and NATO combat mission ends at the end of 2014.

"These guys are good fighters, they're natural fighters. What they're not good at right now is what we're working with — these enablers," he said.

Before flying to Afghanistan, Panetta spoke to about 100 U.S. service members inside an aircraft hangar at Ali al-Salem Air Base in Kuwait. He thanked them for their service and emphasized that the U.S. is winding down its involvement in lengthy wars.

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Associated Press writer Julie Pace in Washington contributed to this report.

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Facebook revises privacy controls in effort to make them more accessible, comprehensible

SAN FRANCISCO – Facebook is trying to make its privacy controls easier to find and understand in an effort to turn the world’s largest social network into a more discreet place.

The fine-tuning announced Wednesday will include several revisions that will start rolling out to Facebook Inc.‘s more than 1 billion users in the next few weeks.

The biggest change will be a new “privacy shortcuts” section that will appear as a tiny lock on the right-hand side at the top of people’s news feeds. This feature offers a drop-down box where users will be able to get answers to common questions such as “Who can see my stuff?”

Other updates will include a tool that will enable individuals to review all the publicly available pictures identifying them on Facebook.

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'Lincoln,' 'Les Mis,' 'Playbook' lead SAG awards

LOS ANGELES (AP) — The Civil War saga "Lincoln," the musical "Les Miserables" and the comic drama "Silver Linings Playbook" boosted their Academy Awards prospects Wednesday with four nominations apiece for the Screen Actors Guild Awards.

All three films were nominated for overall performance by their casts. Also nominated for best ensemble cast were the Iran hostage-crisis thriller "Argo" and the British retiree adventure "The Best Exotic Marigold Hotel."

Directed by Steven Spielberg, "Lincoln" also scored individual nominations for Daniel Day-Lewis in the title role as best actor, Sally Field for supporting actress as Mary Todd Lincoln and Tommy Lee Jones for supporting actor as abolitionist firebrand Thaddeus Stevens.

"Les Miserables," from "The King's Speech" director Tom Hooper, had nominations for Hugh Jackman for best actor as Victor Hugo's long-suffering hero Jean Valjean and Anne Hathaway for supporting actress as a woman fallen into prostitution, plus a nomination for its stunt ensemble.

"Silver Linings Playbook," made by "The Fighter" director David O. Russell, also had lead-acting nominations for Bradley Cooper and Jennifer Lawrence as lost souls who find a second chance at love and Robert De Niro for supporting actor as a football-obsessed dad.

Besides Lawrence, best-actress nominees are Jessica Chastain as a CIA analyst pursuing Osama bin Laden in "Zero Dark Thirty"; Marion Cotillard as a woman who finds romance after tragedy in "Rust and Bone"; Helen Mirren as Alfred Hitchcock's strong-willed wife in "Hitchcock"; and Naomi Watts as a woman caught in the devastation of a tsunami in "The Impossible."

Joining Cooper, Day-Lewis and Jackman in the best-actor field are John Hawkes as a polio victim aiming to lose his virginity in "The Sessions" and Denzel Washington as a boozy airline pilot in "Flight."

SAG nominees are almost all familiar names in Hollywood's awards season. Eighteen of the 20 film acting contenders are past Academy Awards nominees and 13 have won Oscars, among them five two-time winners. Only Cooper and Jackman have never before earned Oscar nominations.

One of the year's most-acclaimed films, Paul Thomas Anderson's "The Master," earned only one nomination, supporting actor for Philip Seymour Hoffman as a mesmerizing cult leader. The film was snubbed on nominations for ensemble, lead actor Joaquin Phoenix and supporting actress Amy Adams.

Other individual performances overlooked by SAG voters include Anthony Hopkins in the title role of "Hitchcock," Keira Knightley in the title role of "Anna Karenina," Bill Murray as Franklin Roosevelt in "Hyde Park on Hudson" and "Argo" director Ben Affleck, who also starred in the film.

The SAG Awards will be presented Jan. 27. The guild nominations are one of Hollywood's first major announcements on the long road to the Feb. 24 Oscars Awards, whose nominations will be released Jan. 10.

Nominations for the Golden Globes, the second-biggest film honors after the Oscars, come out Thursday.

Maggie Smith had four individual and ensemble nominations. Along with sharing the ensemble honor for "Best Exotic Marigold Hotel," Smith joined the cast of "Downton Abbey" among TV ensemble contenders and had nominations for supporting film actress as a cranky retiree in "Marigold Hotel" and TV drama actress for "Downton Abbey."

Nicole Kidman earned two individual nominations, as supporting film actress as a woman smitten with a prison inmate in "The Paperboy" and best actress in a TV movie or miniseries as war correspondent Martha Gellhorn in "Hemingway & Gellhorn."

Bryan Cranston had three overall nominations, as best actor in a TV drama for "Breaking Bad," an ensemble honor for that show and a film ensemble honor for "Argo."

Along with "Breaking Bad" and "Downton Abbey," best TV drama ensemble contenders are "Boardwalk Empire," ''Homeland" and "Mad Men." TV comedy ensemble nominees are "30 Rock," ''The Big Bang Theory," ''Glee," ''Modern Family," ''Nurse Jackie" and "The Office."

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Online:

http://www.sagawards.org

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Congress examines science behind HGH test for NFL

WASHINGTON (AP) — A congressional committee has opened a hearing to examine the science behind a human growth hormone test the NFL wants to start using on its players.

Nearly two full seasons have passed since the league and the players' union signed a labor deal that set the stage for HGH testing.

The NFL Players Association won't concede the validity of a test that's used by Olympic sports and Major League Baseball, and the sides haven't been able to agree on a scientist to help resolve that impasse.

Among the witnesses before the House Oversight and Government Reform Committee on Wednesday is Pro Football Hall of Fame member Dick Butkus. In his prepared statement, Butkus writes: "Now, let's get on with it. The HGH testing process is proven to be reliable."

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Store employee saves customers during Ore. mall shooting

A store employee at the Clackamas Town Center
mall used his knowledge of the shopping complex to hustle a customer
out of the building during Tuesday's shooting rampage and then twice
went back inside to guide other shoppers to exits and safety.

Allan Fonseca, who works at Lancome counter in Macy's and was waiting on
Jocelyn Lay when they heard shots fired about 3:30 p.m. Thinking
quickly, Fonseca got her behind the counter to hide.

"We both just looked at each other and knew that this was a serious
situation and it was a gunman and we both just dove down below the
Lancome counter there for a little protection," Lay told "Good Morning
America." "And the gunfire just kept going off."

PHOTOS: Oregon Mall Shooting

Lay said that she began praying for the Lord to protect her and the
other shoppers in the mall. She said Fonseca, as a store employee, knew
exactly what to do, and she credits him as her hero.

"He said that we needed to evacuate, and he took me by the hand and took me down the escalator and out to safety," she said.

Once Fonseca was sure that she was safe, he then turned to her and said, "I'm going to go back and help other people."

Fonseca said that because he is familiar with the exits in the mall, he
felt that he would be able to help shoppers escape the gunfire.

"I felt that if I knew how to get out of the mall and out to safety then
I should share that knowledge with everyone else, like the shoppers
that don't come here regularly and don't know all of the exits," he
said. "So I decided to go back up because I wanted to see if there was
anybody in panic or didn't know where to do."

Fonseca returned to the mall and evacuated the lower level of the Macy's
store, and then went back up to the "shooting floor" to look for his
co-workers. Lay says she's not sure she would have done if he hadn't
been there to get her out of harm's way.

"I probably just would have stayed there and probably would have had a
little more fear because it's one of those situations where you've seen
in previous shootings, the gunman keep shooting and keep looking for
different people," she said. "I would have huddled there and hoped and
prayed."

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US: Afghans resisting efforts to track cash exodus

KABUL, Afghanistan (AP) — A U.S. watchdog agency said Tuesday that Afghan officials were resisting U.S. efforts to help track billions of dollars being flown out of Kabul airport every year, some likely linked to crime and drugs.

The U.S. and other nations have long expressed concern about the amount of cash being flown out of the country — an estimated $4.5 billion last year, according to the U.S. Congressional Research Service. Afghanistan has a cash-based economy and moving large bundles of cash is common, yet it raises the risk of money laundering and cash smuggling to finance terrorist, narcotics and other illicit activities.

Hundreds of millions of dollars from the collapsed Kabul Bank were flown out of Afghanistan — some in airplane food trays — to more than two dozen other countries, a recent report on the collapse said. The demise of the bank, the nation's largest financial institution, became a symbol of endemic corruption that plagues Afghanistan.

"The persistent delays in instituting basic anti-money laundering procedures by the Afghan government at Kabul International Airport are deeply troubling," the report by the Special Inspector General for Afghanistan Reconstruction said. "Although proper controls to monitor cash flows are important for any country to institute, they are particularly critical for a country fraught with corruption, narcotics trafficking and insurgent activity."

To help Afghanistan track the cash moving through the airport, the U.S. purchased $117,275 worth of bulk currency counting equipment. Though the contract to install them was awarded in July 2010, they were not put in until April 2011, the report said.

SIGAR staff made follow-up visits to the airport in September and November but never saw the cash counters being used. Moreover, the report said VIPs — some carrying cash — continue to bypass controls.

The report said the cash counters were in a small, closet-like area not easily accessible to customs or banking officials in the international terminal.

While they were plugged in and appeared to be in working order, they were not connected to the Internet or a computer server. The report said that being connected is essential for sending the serial numbers of the bills and other data to the Financial Transactions and Records Analysis Center of Afghanistan, which is part of the Afghan central bank.

"U.S. Department of Homeland Security officials told us that their efforts to address these problems have stalled, even though the use of bulk currency counters to record and transmit data is critically important for their law enforcement activities," the report said. "According to one official, Afghan officials have neither committed to connecting the machines to the Internet nor agreed to establish a working link to FinTRACA."

During the visit, Afghan customs and banking officials were unable to explain why the machines remained without Internet connectivity, the report said.

"However, one DHS official told us that Afghan customs at Kabul airport were afraid that they would experience negative repercussions from the Afghan government if progress in instituting controls at the airport was made," the report said.

SIGAR expressed dismay that cash being carried by VIPs was being declared, but still not scanned.

"No bulk currency counter was available for the counting or data collection of currency declared by VIPs, who do not undergo main customs or security screenings. According to a DHS official, many of the individuals who traffic money leave from the VIP area," the report said. "A new Very Very Important Persons (VVIPs) lounge was built to provide easier boarding access for high-ranking officials, again allowing transit without main customs screenings or use of a bulk currency counter."

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'Lincoln' leads Critics' Choice Awards nominees

LOS ANGELES (AP) — Film critics love "Lincoln." The historical drama earned a record-breaking 13 nominations for the Critics' Choice Movie Awards.

The Broadcast Film Critics Association announced the nominees for its 18th annual awards ceremony Tuesday in Los Angeles.

"Lincoln" beat the 12 nods earned by 2010's "Black Swan" with bids for director Steven Spielberg, star Daniel Day-Lewis and supporting actors Sally Field and Tommy Lee Jones, as well as cinematography, adapted screenplay, costume design, makeup, editing, art direction, score and acting ensemble.

"Les Miserables" follows with 11 nominations and "Silver Linings Playbook" has 10. "Life of Pi" earned nine nods. "Argo," ''Skyfall" and "The Master" each have seven.

Winners will be announced Jan. 10, 2013, at a ceremony set to be broadcast live on the CW network.

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Online:

www.criticschoice.com

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Surprise: New insurance fee in health overhaul law

WASHINGTON (AP) — Your medical plan is facing an unexpected expense, so you probably are, too. It's a new, $63-per-head fee to cushion the cost of covering people with pre-existing conditions under President Barack Obama's health care overhaul.

The charge, buried in a recent regulation, works out to tens of millions of dollars for the largest companies, employers say. Most of that is likely to be passed on to workers.

Employee benefits lawyer Chantel Sheaks calls it a "sleeper issue" with significant financial consequences, particularly for large employers.

"Especially at a time when we are facing economic uncertainty, (companies will) be hit with a multi-million dollar assessment without getting anything back for it," said Sheaks, a principal at Buck Consultants, a Xerox subsidiary.

Based on figures provided in the regulation, employer and individual health plans covering an estimated 190 million Americans could owe the per-person fee.

The Obama administration says it is a temporary assessment levied for three years starting in 2014, designed to raise $25 billion. It starts at $63 and then declines.

Most of the money will go into a fund administered by the Health and Human Services Department. It will be used to cushion health insurance companies from the initial hard-to-predict costs of covering uninsured people with medical problems. Under the law, insurers will be forbidden from turning away the sick as of Jan. 1, 2014.

The program "is intended to help millions of Americans purchase affordable health insurance, reduce unreimbursed usage of hospital and other medical facilities by the uninsured and thereby lower medical expenses and premiums for all," the Obama administration says in the regulation. An accompanying media fact sheet issued Nov. 30 referred to "contributions" without detailing the total cost and scope of the program.

Of the total pot, $5 billion will go directly to the U.S. Treasury, apparently to offset the cost of shoring up employer-sponsored coverage for early retirees.

The $25 billion fee is part of a bigger package of taxes and fees to finance Obama's expansion of coverage to the uninsured. It all comes to about $700 billion over 10 years, and includes higher Medicare taxes effective this Jan. 1 on individuals making more than $200,000 per year or couples making more than $250,000. People above those threshold amounts also face an additional 3.8 percent tax on their investment income.

But the insurance fee had been overlooked as employers focused on other costs in the law, including fines for medium and large firms that don't provide coverage.

"This kind of came out of the blue and was a surprisingly large amount," said Gretchen Young, senior vice president for health policy at the ERISA Industry Committee, a group that represents large employers on benefits issues.

Word started getting out in the spring, said Young, but hard cost estimates surfaced only recently with the new regulation. It set the per capita rate at $5.25 per month, which works out to $63 a year.

America's Health Insurance Plans, the major industry trade group for health insurers, says the fund is an important program that will help stabilize the market and mitigate cost increases for consumers as the changes in Obama's law take effect.

But employers already offering coverage to their workers don't see why they have to pony up for the stabilization fund, which mainly helps the individual insurance market. The redistribution puts the biggest companies on the hook for tens of millions of dollars.

"It just adds on to everything else that is expected to increase health care costs," said economist Paul Fronstin of the nonprofit Employee Benefit Research Institute.

The fee will be assessed on all "major medical" insurance plans, including those provided by employers and those purchased individually by consumers. Large employers will owe the fee directly. That's because major companies usually pay upfront for most of the health care costs of their employees. It may not be apparent to workers, but the insurance company they deal with is basically an agent administering the plan for their employer.

The fee will total $12 billion in 2014, $8 billion in 2015 and $5 billion in 2016. That means the per-head assessment would be smaller each year, around $40 in 2015 instead of $63.

It will phase out completely in 2017 — unless Congress, with lawmakers searching everywhere for revenue to reduce federal deficits — decides to extend it.

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Michigan passes right-to-work bill

LANSING, Michigan (Reuters) - The Republican-majority Michigan legislature gave final approval on Tuesday to "right-to-work" restrictions on public sector unions in a state considered a stronghold of organized labor, as protesters chanted in the gallery and thousands rallied outside.

The House passed the measure making membership and payment of union dues voluntary for public sector employees such as teachers by a 58-51 vote. The Senate approved the same bill last week so it will now go to Republican Governor Rick Snyder, who has promised to sign it into law.

The public sector law was the first of two expected to be approved by the House on Tuesday. The other covers private sector workers, including the large auto industry in Michigan.

More than 12,000 workers from throughout Michigan and the U.S. Midwest protested as the legislature voted, most gathered in freezing temperatures and a light snow outside the building to show their displeasure.

Michigan State Police Inspector Gene Adamczyk said the Capitol was closed to visitors when it reached capacity of 2,200. An estimated 10,000 people demonstrated outside.

A few protesters were ejected from the Capitol after they chanted slogans from the gallery during the debate. Outside of the building, protesters tore down two tents set up for supporters of right-to-work as the crowd applauded but Adamczyk said there had been no arrests by late morning.

The show of force by unionized workers recalled huge rallies in Wisconsin two years ago when Republicans voted to curb public sector unions.

The right-to-work movement has been growing in the United States in recent years. Indiana earlier this year became the first state in the industrial Midwest to approve right-to-work and several other states are watching the Michigan action closely.

Michigan would become the 24th state to enact right-to-work provisions in a stunning blow to the power of organized labor in the United States, which has suffered a series of setbacks in recent years.

Wisconsin Republicans in 2011 passed laws severely restricting the power of public sector unions. While Wisconsin did not even attempt to pass right-to-work, the success of Republicans there in curbing powerful unions such as teachers and state workers emboldened politicians in other states to follow suit.

Michigan is home of the heavily unionized U.S. auto industry, with some 700 manufacturing plants in the state. It is also the birthplace of the United Auto Workers, the richest U.S. labor union. Michigan has the fifth highest percentage of unionized workers in the United States at 17.5 percent.

Detroit area is headquarters for General Motors Co, Ford Motor Co and Chrysler, which is majority owned by Fiat SpA.

(Additional reporting by Robert Carr; Editing by Greg McCune and Bill Trott)

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