Prime Minister Olmert has decided on a peace initiative and the Israeli-Hamas-PLO ceasefire is holding. 

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We at Warren Reports hope that you had a wonderful Thanksgiving holiday. But the news never stops, so here are a few stories, courtesy of USA Today, that you may have missed.

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Given that a civil war is going on in Iraq, which side does the White House want to win?

Every so often there is a week of convergence, where the same question, perhaps in different forms, crosses the keyboard of a variety of different people. In the last few days or so Daniel Gross and Michael Kinsley and Barry Ritholtz all scratch their heads about the sloshing of global monetary dynamics and asset inflation. Their thoughts are related, and they are related to the the meaning of money. And for those of you taking bets on the hell freezing over, Max Sawicky quoting Milton Friedman has got to at least be an iceberg on the river Styx.

The meaning of money. One of the most important aspects of what we have seen in the last 25 years, and more specifically in the last 6, concerns the nature of money.

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Open letter to Secretary Paulson:
Social Security faces a lack of funds to pay its commitments some years after the ice caps will, under current trends, have melted, flooding Florida; after oil hits several hundred dollars a barrel; after income inequality turns America into France of 1788; after rising Asian competition eliminates the American Dream -- see my book "In China's Shadow." So let's get our priorities right.
Meanwhile, deficits do matter, and it's medical payments both private and public that are causing both firm and government deficits to soar (ask Ford; ask around your office). It's not Social Security.
Let's get our priorities right.
Democrats: don't be beguiled; don't follow the red herrings.

While the fighing continues in Iraq and bodies pile up, the Shia leaders are acting like they have won and are taking steps reflective of their perceived victory. Prime Minister Maliki moved quickly this week to advance Iranian interests in the region while continuing to request that U.S. forces stay in Iraq to help protect the Shia-dominated government from the Sunni insurgents.

Today's announcement that Iraq and Syria re-establshished diplomatic relations after 28 year old break up is a dramatic signal that Iran's dominance in the region is spreading at the expense of the United States. Quite a counterpoint to the spectacle of the Bush Administration officials, like John Bolton, condemning the Syrians and the Iranians for meddling in Lebanon. Wild gesticulations by angry Bush Administration folks were met by a collective yawn among the Shia in the Middle East.

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The Economist is publishing a piece on Bolton's tenure at the U.N. and his future. Importantly, it includes some straightforward assessments of what he has achieved there. Two of the home run lines:

“If Bolton left tomorrow, progress would be possible on almost every front where it is now stalled,” one senior Western diplomat fumed. “He has succeeded in putting almost everyone's backs up, even among some of America's closest allies. His main achievement has been to break the unified coalition of the North and unify the previously fragmented South.” 

And... 

“The big problem with Bolton,” says one formerly well-disposed UN official, “is not what he's trying to achieve, but his style. It is extraordinary how badly he has served American interests. To be embraced by America is now seen as a kiss of death.”

Let's let that echo for awhile. 

Keith Porter of the Stanley Foundation showed me this excellent overview of the candidates to succeed Bolton in Foreign Policy Magazine. Without revealing my favorite candidate - who would surely be doomed by my endorsement - I'll say Khalilzad has to be considered the front-runner, with Dobriansky a close second. And despite the clear legal and political obstacles, Bolton has to be considered a candidate to stay at the post. He may be willing to serve as a volunteer, and if not, does anyone really doubt this Administration's willingness to stretch the powers of the executive?

It’s become common today in policymaking circles to talk about the incredibly wide-ranging effects that cleaner energy production would have on our nation’s policies. From foreign policy in the Middle East to environmental implications at home, and aboard, a fundamental change in our energy policy could positively impact our nation in many ways. However one of the ways that is often left out of that discussion is the incredible boon to America’s middle class that would accompany an energy policy transformation in this country.

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"Whether or not a verdict of guilty would have been appropriate in a court of law for 'the crime of 1873,' that verdict is appropriate in the court of history. . . . The rhetoric was overheated, but the importance of the issue was not overstated. The act of 1873 cast the die for the gold standard . . . While the conventional view is Laughlin's, that 'the act of 1873 was a piece of good fortune,' my own view is that it was the opposite--a mistake that had highly adverse consequences." -- Milton Friedman, Money Mischief.

My friend Stirling wants to lobotomize populism. Populism is passionate but dumb, so we need to harness the emotion to something else. What could that be?

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Brooklyn natives Norm Coleman (R, MN) and Chuck Schumer (D, NY) sparred over the recent election and the emerging 2008 political battleground here in NYC last night. After briefly bantering about their days in public elementary school together and their incestuous web of high school crushes, the James Madison High alums conceded a bittersweet irony: each entered politics in the 60s inspired by his opposition to a nasty foreign war dividing the country.

The big lesson, to my mind? The Senators’ response to The Washington Post scoop Monday about the Pentagon’s closely guarded review of the War in Iraq. The review boils down the military’s options to three: “Go Big,” “Go Long,” “Go Home.”

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Yesterday Max pointed back at populism of the late 19th century as a fertile ground for looking at the present. And who, having watched yet another bloodless performance by some FoxNews Democrat can deny that the moral clarity, fire in the belly and political grounding of populism is distinctly lacking in today's Democratic Party?

However, there is a larger picture - it is easy to pick apart the many failings of the populist movement, as a product of its time and place. It is even useful to do so, because in our own moment, some of the same mistakes are being made. "Energy Independence" is the "Free Coinage of Silver" of our era - a bad idea which is near and dear to the hearts of millions who don't have a clue about how to solve the real problems.

That larger picture is that, in the present, we must replace an old conversation - a conservative/reactionary/technocratic conversation with a new one - a progressive/populist/liberal conversation. The context of the populist movement is vital - because the natural rival of populism in the public mind is the reactionary movement. Racism and homophobia are the populism of fools.

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If I was carried away by the noble ideal of turning the Middle East into Midland; and if my dad blew it when he had his chance; and if I knew that I was the instrument of the Almighty, who knew the Iraqis wanted to be free to blow other Iraqis to smithereens and chop off their heads; and if I knew in my gut that we couldn't fail, because we're America; and if I didn't give a flying fig what a bunch of old-fart cut-and-runners thought; and if a heap of people died as a result of my commitment to freedom (but they weren't freedom-lovers); and if I've driven the world nuts, and if some evildoers think the United States is something other than a beacon of freedom--well, if I did any of that, and I'm not saying I did, tough. I'm the decider and you're not, you get my drift?

On behalf of my colleagues at Bolton Watch, I want to wish Ambassador Bolton a happy birthday. As we've written before, all of us want to see Bolton successfully achieve U.S. foreign policy priorities and build a strong and effective United Nations. As he might say, we've observed more in sorrow than in anger that he has failed at both.

Bolton's conservative backers spent part of last week touting his response to the General Assembly's resolution on the Israeli-Palestinian conflict. The statement - and its timing - is worth a closer look.

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Peter Lance is back hawking his latest book, Triple Cross. Unfortunately, it does not come with a “Buyer Beware” label. Peter, in my judgment, confuses self-promotion with analysis and is prone to jump to conclusions not supported by actual evidence. Consider for example Lance’s specious claim in his recent post on Huffington Post, touting his book and his accomplishments:

What isn't known and will be revealed for the first time in Triple Cross was that Ali Mohamed had been acting as an FBI informant on the West Coast since 1992 - a year before the WTC bombing carried out by the same cell members he'd trained.

Really? Here’s what Kit R. Roane; David E. Kaplan; Chitra Ragavan wrote in the January 8, 2001 edition of US News and World Report (Vol. 130 , No. 1; Pg. 25):

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Since the Democrats’ victory last week, the unions are out in full force promoting a “pro-worker” agenda. Unfolding from six years in a “defensive crouch,” the unions now propose a series of policy measures to counter the growing economic vulnerability of many American working families due to stagnating wages, job insecurity, income volatility, and rising healthcare costs. The Democratic agenda includes a package of “economic policies that benefit everyone,” according to Rep. George Miller (D-CA), likely the next chairman of the House Committee on Education and the Workforce. Critically, voters and the unions must respectively demand and pursue the universalism that the term “everyone” indicates. The case of rebuilding New Orleans after Hurricane Katrina illustrates the political and cultural difficulties ahead in achieving this.

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"The fruits of the toil of millions are boldly stolen to build up the fortunes for a few, unprecedented in the history of mankind; and the possessors of these, in turn, despise the Republic and endanger liberty. . . We declare that this Republic can only endure as a free government while built upon the love of the whole people for each other and for the nation . . . " -- The Omaha Platform, 1892

If the term 'populist' is the merely popular, it is meaningless since popular fashions change and usually lack depth. If it is merely anti-elite, the question becomes, which elite? When? All of them, always? If so, once again there is no meaning. History provides some guidance. The origin of the movement in the 19th century provides a template for the present. The same themes and issues are with us.

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Much of the nation's government is in need of overhaul, many of the rules, laws, commissions and systems that have grown up over the years are in need of drastic revision and updating to take into account the global reality, and the changes in American life. Consider that when the SEC - the Securities and Exchange Commission - was created, only a slender slice of the American public owned stock, and most didn't even indirectly own stock through a pension or other investment program. Whole Life Insurance was one of the wider vehicles, a product that has virtually disappeared.

The problem with Bush's first two Secretary's of the Treasury is that they had no credibility on this issue. Paulson however, does have credibility on this issue, and has announced a major speech on his vision for changing regulation

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Here's a solid analysis from Bankrate.com on what we can expect from this new Congress, and particularly from Rep. Barney Frank of Mass., the likely chairman of the House Financial Services Committee, and Sen. Chris Dodd of Conn., likely chairman of the Senate Committee on Banking, Housing, and Urban Affairs.

Some interesting policies on tap include ...

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Take a look at this must-read column by E.J. Dionne (who tips his hat to Jacob Hacker).

The bottom line: "Yes, there is a middle-class squeeze."

Al-Jazeera television premiered with its international channel last week, but the only way an American viewer can watch it is in on the internet. That's because none of the cable companies will agree to carry it. Of what are they afraid? That the American people might actually learn about how the Arab world looks at us?  It's hard to imagine anything more counterproductive than keeping Al-Jazeera from our airwaves.

I saw the effects of this type of lunacy when I was in Israel this summer. 

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I have some sympathy with the difficulties experienced by the President and Secretary of State as they tried to articulate the meaning of Vietnam to them, and to cope with its incongruous application to their policies in Iraq. The terrible, long wars of Southeast Asia were, to the thinking of neo-cons, pragmatically justified as a check on communism. To this day the neocons argue that South Vietnam was lost only because Congress cut off funds for military aid after the American military withdrew, and in any case Thailand and Malaysia remained safely within the sphere of American influence and capitalism because the United States drew the line in Vietnam and Cambodia. This is, however, an almost completely upside-down revisionist description of the actual history of the region. Thinking clearly about Vietnam should lead, if logic mattered, to thinking clearly about Iraq. It would even lead to a less defeatist approach than now being spun by repeatedly misguided Washington media.

The chief lesson of Vietnam is that in any civil war, the interests of peace and economic development are both served by having someone win.

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