Krebs Daily Briefing 30 October 2015


‘This Country Should Compensate Me’

On Oct. 29, in the wake of the Fifth Plenum, a meeting of top leaders, the Chinese government announced that its controversial, decades-long policy of limiting most couples to a single child was to come to an end. While some Western observers are cheering at the end of the repressive (and sometimes brutally-enforced) policy, one group within China is already speaking up in dissatisfaction: China’s only children themselves. According to a vaguely worded communiqué released on Oct. 29, all Chinese couples will now be allowed to have two children, a right that has thus far only been extended to some. Policy supporters have long argued that in a country like China, with an already huge population and limited resources, unchecked population growth would keep millions mired in poverty and place unbearable strain on natural resources. But the “planned birth policy,” as it is known in Chinese, has not only caused heartache for countless families prevented from having through massive fines, sterilization, and in some cases forced abortions — it has also wildly distorted the country’s demographics. At the end of 2014, Chinese men outnumbered Chinese women by 33 million, due to a traditional preference for sons and the gender-selective abortions that many have opted for in order to guarantee that their single child is male. Additionally, low birth rates mean that China’s population is aging swiftly. And as the country’s once-explosive economic growth slows, the move to prevent a double economic and demographic decline is unsurprising. More:

Back to School in Mosul: The ISIS Curriculum

The so-called Islamic State continues to pretend it has the trappings of a real government. In addition to bogus ‘gold’ coins, it now offers a ridiculous syllabus. MOSUL, Iraq — For some parents in Mosul, this northern Iraqi city controlled by the extremist group known as the Islamic State, the worst has come true. After destroying many of the textbooks their children used to use in Mosul’s schools, the Islamic State, or ISIS or Daesh, as it’s widely known, has developed a whole new curriculum for school-aged children living inside the areas it controls. A father of three in Mosul, whom we’ll call Abu Omran, was hoping until very recently that his children might be able to go back to school. They had not been to class since ISIS took control of the city in mid-June last year. But now he is increasingly pessimistic about his children’s future. They already have lost two terms of schooling and now it looks likely they will lose a third. “I will not let them attend school just so they can learn about murder and extremism,” Abu Omar told us in a conversation conducted over a social messaging service. “Nobody is going to accept any of their qualifications anyway. My children were excellent students. I just wish I could take them out of this city so they could continue their schooling.”  There are between 300,000 and 400,000 students of all ages in Mosul, Iraq’s second-largest city, and most have the same kinds of problems. Iraq’s Ministry of Education has already said that it wouldn’t accept any certificates or qualifications that pupils passed in areas under ISIS control. And it is easy to see why. We managed to obtain some digital samples of the new primary school curriculum, to be taught to children aged between 6 and 12 years old. Even just reading the introductions to the textbooks it is clear the level of indoctrination that is at work in them. For example, in a book about physical fitness for 6-year-olds, two words are written on the cover: “continue”, or exist, and “expand.” The two words are used continuously inside the book with regard to sports and physical exercise. However these two words are more significant than that—they are part of the well known ISIS motto, which says the Islamic State will “continue (or persist and remain) and expand.” Illustrations in other books, such as one on religious education and religious missions, or jihad, show children wearing the same outfit as the grown ISIS fighters wear—a loose “Afghan-style” tunic and baggy pants—and carrying weapons like pistols and machine guns. A mathematics textbook asks arithmetic questions like this: If the Islamic State has 275,220 heroes in a battle and the unbelievers have 356,230, who has more soldiers?

Why Obama Should Just Let Putin Have the Mess in Syria

You can’t make a silk purse out of a sow’s ear. Nor can Vladimir Putin broker a political solution in Syria. In fact, as a result of his recent attempts to play diplomatic power broker in the Middle East, he will lose credibility. That will only grow more apparent later this week when officials from Iran — like Russia, a major backer of Syrian President Bashar al-Assad — meet with their American and Russian counterparts in Vienna to discuss a political resolution to the Syrian conflict. Russia has reportedly been pushing for Iran’s inclusion in these high-stakes talks. But Putin is setting himself up for disappointment. That’s because there is no political solution to the Syria crisis: Russia’s purported aspiration to hold talks with the “full spectrum” of rebel groups in Syria will inevitably fail because that spectrum plainly includes hard-line Islamists and the Islamic State — contingents that neither Washington nor Moscow is prepared to deal with. In the absence of a political solution, recapturing areas held by Islamist rebels will necessarily involve a long, bitter fight to the death — a fight that Assad, Iranian proxies, and now the Russians are stuck with. The idea that Putin’s decision to deploy several dozen aircraft to prop up Assad resembles some strategic masterstroke is a fantasy. The idea that Putin’s decision to deploy several dozen aircraft to prop up Assad resembles some strategic masterstroke is a fantasy. Those in the Beltway crowd who say Washington should aggressively escalate to counter Moscow’s move in Syria are wrong. Drawing Russia into the Syrian swamp is, in fact, the best opportunity the Obama administration has had in months to weaken Putin. Conversely, Putin’s Syria strategy isn’t tough to grasp. The location of Russian strikes in Syria in recent weeks suggests that he wants to help Assad and his Shiite militia proxies connect government-held areas in Homs to those in Aleppo by clearing Latakia, Hama, and Idlib provinces of non-Islamic State rebels. If successful, this campaign would eliminate most of the rebel groups in these areas, ranging from the sorry remnants of the CIA-equipped Free Syrian Army to al-Nusra Front, al Qaeda’s Syrian franchise, leaving the Islamic State and the Kurds as the only serious fighters left in northern Syria. Washington and its allies, by Putin’s calculation, would be forced to accept Assad as the only option to take on the Islamic State in the Sunni parts of northern and central Syria. Assad stays in power. Putin becomes the new regional power broker. And U.S. regional hegemony is upended.

Volkswagen Lied, 60 People Died, Scientists Say

About 60 Americans have already died prematurely as a result of the “defeat devices” that Volkswagen installed in 500,000 cars to avoid federal pollution requirements. If the cars are not recalled, turned in, and adequately fixed, about 140 people will eventually die in the United States as a result of the car manufacturer’s malfeasance. Those numbers are according to the first peer-reviewed study of the phenomenon, which was published Thursday in Environmental Research Letters, an open-access journal. Its estimates are notable not only for their methodology, but also for their size. All previous estimates of the defeat device’s consequences were conducted back-of-the-envelope by news organizations, and they were all comparatively smaller: The New York Times estimated 40 additional deaths in the U.S., Vox calculated between five and 27 deaths, and the Associated Press approximated to between five and 20. Steven Barrett, a professor of aerospace and energy at the Massachusetts Institute of Technology, said the equivalent costs of Volkswagen’s pollution came to about $450 million over the period the cars were sold. Eventually, the cars could cost Americans an additional $910 million. But there is some good news. “If people do turn in those cars, most of those 140 deaths would be averted,” Barrett told me. The study also was the first to estimate additional medical costs attached to the company’s diesel cars. Additional nitrous-oxide and particular matter released by the cars led to Americans (especially those with a chronic respiratory condition, like asthma) suffering about 30 cases of chronic bronchitis, 120,000 restricted activity days, and 210,000 days of lower respiratory-system functioning. It also caused people to use bronchodilator drugs—like albuterol—33,000 more days than they would otherwise. Barrett said that researchers would likely next turn their attention to Europe, where diesel cars, especially those manufactured by Volkswagen, constitute a much larger percentage of cars on the road. Many of those countries, as well, have more stringent nitrous-oxide rules. “The U.K. alone has 1.2 million of these affected vehicles for example. That’s twice as many cars, and in a more densely populated country, so that suggests there are other countries beyond the U.S. worth looking into,” he said. The Atlantic has reached out to Volkswagen for comment, and will update this story with any response.


Paul Ryan elected 54th House speaker

Paul Davis Ryan, the 45-year-old policy wonk from Wisconsin, is now speaker of the House. The 16-year veteran of Congress received the support of all but nine of his colleagues in an election to replace John Boehner on Thursday, ending a tumultuous month long period for the Republican Party and the House of Representatives. “To me, the House of Representatives represented the best of America, the boundless opportunity to do good,” Ryan said after the election, speaking from the speaker’s podium. “But let’s be frank. The House is broken. We’re not solving problems, we’re adding to them. And I’m not interested in laying blame. We’re not settling scores, we’re wiping the slate clean.” Ryan won a commanding 236 of 245 Republican votes, a feat in a deeply fractured and divided party. House Minority Leader Nancy Pelosi of California received 184 votes, and nine Republicans voted for Florida Rep. Daniel Webster. The resounding victory gives hope that Ryan might be able to heal an institution damaged by years of hyperpartisanship and crisis-driven legislating. Ryan has always been an outsize figure on Capitol Hill. His budgets were sharply criticized by Democrats and used as an election-season weapon. But the GOP stuck with the spending plans and increased their House majority — and Ryan’s stature has only grown.

Senate approves two-year budget deal in 3 a.m. vote

The Senate passed a two-year budget deal that raises the debt ceiling early Friday morning, sending the agreement to President Obama’s desk. The deal was approved in a 64-35 vote after 3 a.m. after a late speech by Sen. Rand Paul (R-Ky.), who criticized the legislation as a blank check for President Obama to add to the nation’s debt. “Both sides of the aisle have what I would call sacred cows. On the right, they have the sacred cow of military contracts. …The left wants more welfare,” he said, adding, “Should we give Congress more money? Hell no. Few other senators seemed interested in Paul’s speech, as the presiding officer repeatedly had to ask senators to keep their conversations down so that Paul could speak. Sen. Amy Klobuchar (D-Minn.) tweeted her dissatisfaction, arguing the GOP presidential candidate was simply seeking attention for his campaign. “Senate &staff all here at 1:55 am so that Pres candidate Rand Paul can send tweet out telling fans to watch him,” she said. Thirty-five Republicans opposed the deal, including Sens. Pat Toomey (R-Pa.) and Ron Johnson (R-Wis.), who are facing tough reelection battles in blue-leaning states next year. The legislation clears the calendar of major fiscal fights, including funding the government, until after the 2016 elections that will see Republicans defending 24 Senate seats. The bill also drew strong pushback from conservative senators, who suggested leadership caved on the debt ceiling, negotiated in secret and tried to push the legislation through Congress on an expedited schedule.


How CNBC Lost Its Own G.O.P. Debate

Americans and pundits will spend the next few days weighing who won Wednesday night’s Republican debate on CNBC. But the night’s loser was clear even before it started: the network itself, which started the main event late and asked questions that left even the candidates scratching their heads. CNBC had set the main debate to begin at 8 p.m. But instead, CNBC anchors spent some 15 minutes talking about politics in a manner that demonstrated a light familiarity with the issues, and continued speaking even after the candidates were already waiting on stage. The aimless chatter lit the Twitter conversation on fire. It wasn’t just journalists on Twitter who took issue with the network’s tactics. When CNBC anchor Carl Quintanilla asked Senator Ted Cruz a question about why he doesn’t support a deal that would raise the debt limit, prevent a government shutdown, and calm financial markets, Cruz used his time to instead bash the network for the kinds of questions that moderators had been asking . “The questions that have been asked so far in the debate illustrate why the American people don’t trust the media,” he said. “This is not a cage match. You look at the questions: ‘Donald Trump, are you a comic book villain?’ ‘Ben Carson, can you do math?’ ‘John Kasich, will you insult two people over here?’ ‘Marco Rubio, why don’t you resign?’ ‘Jeb Bush, why have your numbers fallen?’ How about talking about the substantive issues people care about?” His response was met with a round of applause, and a befuddled Quintanilla reminding him that he had, in fact, just asked him a substantive question, but that Cruz had chosen not to answer it. Cruz responded by saying, “The questions that are being asked shouldn’t be trying to get people to tear into each other. It should be what are your substantive positions.” When he said he would gladly answer the question, the moderators said they were moving on. This, again, drummed up Twitter to dump on CNBC. CNBC’s handling of the debate reportedly caused Bush campaign manager Danny Diaz to confront a CNBC producer—as the debate was live on air—about how poorly it was managed, according to Politico. The bleeding didn’t stop there. Even when the candidates weren’t telling the truth, the moderators weren’t immediately able to call them on it. When CNBC anchor and moderator Becky Quick asked Trump why he’s been critical of Facebook founder Mark Zuckerberg’s stance on immigration reform, Trump said he hadn’t been, when, in fact, he had been. But Quick was flumoxed, and didn’t have her notes handy, so instead of pressing him, she said, “Where did I read that, then?” “You people write this stuff. I don’t know,” Trump said. To CNBC’s credit, the network used a commercial break to feed Quick the source the question was based on: Trump’s own Web site. The reaction on social media, however, didn’t exactly help CNBC’s case. More:

GOP blocks resolution supporting equal pay for female soccer players

Senate Republicans on Thursday blocked a resolution supporting equal pay for female soccer players, suggesting the Senate’s schedule was too packed to take it up. Sen. Patrick Leahy (D-Vt.) asked for unanimous consent to pass a nonbinding resolution calling on the Federation Internationale de Football Association (FIFA) to “immediately eliminate gender pay inequity. Democrats have rallied around the issue after a U.S. win in the Women’s World Cup, when they received a $2 million award compared to the $35 million Germany received after winning the 2014 Men’s World Cup. President Obama, on Tuesday, hosted the women’s national soccer team at the White House. Leahy added Thursday that while he’s heard opponents argue that ‘oh, no, we must pay men more than women. Point to revenue as the reason behind this disparity.’ [But] revenue can’t be accepted as a means for discrimination. Awards should not be determined by gender.” But his request was objected to by Sen. Lamar Alexander (R-Tenn.), who suggested that the Senate is facing a packed schedule with issues that must be addressed. “We have a budget to pass. We have a debt crisis to fix. We have an education system that needs reform. We have a humanitarian crisis in Europe that we ought to address,” he said from the Senate floor. “That’s what the United States Senate ought to be spending its time on rather than offering opinions and resolutions about a private international entity and how they should award prizes and awards.” The Tennessee Republican, who chairs the Senate’s Health, Education, Labor and Pensions (HELP) Committee, added that “gender discrimination is wrong, all of us know that.” But Leahy suggested it would take only a short amount of time to pass the resolution by unanimous consent, which requires the agreement of every senator. “We could take 30 or 50 or 82 seconds out of the 100 hours or so we’ll spend during the month just sitting here doing nothing and pass a resolution that calls for the equal treatment of male and female athletes,” he said. “If we can’t even pass a nonbonding resolution, how do we ever achieve real pay equity for women? … It sends a terrible message to mothers and daughters, granddaughters around the globe.”

Clinton Ally Files Ethics Complaint Against Gowdy For Benghazi-Related ‘Leak’

House Benghazi select committee Chair Trey Gowdy (R-SC) inappropriately disclosed private information about a GOP whistleblower who said he was fired from the committee in part because he refused to target Hillary Clinton, according to an ethics complaint from a pro-Clinton watchdog group. The American Democracy Legal Fund, founded by Clinton ally David Brock, alleged that Gowdy violated the Congressional Accountability Act by disclosing information about ex-staffer Bradley Podliska’s private settlement discussions with the committee. Gowdy told The Washington Post earlier this month that Podliska cited his status as a major in the Air Force reserve as the basis for his termination in a September mediation filing, rather than any pressure to investigate Clinton. “The CAA prohibits parties to a dispute resolution from disclosing information from the dispute resolute (sic),” ADLF President Brad Woodhouse wrote in a letter dated Oct. 27 to the Office of Congressional Ethics. “Rep. Gowdy violated the statute by publicly revealing the contents of Mr. Podliska’s record and mediation filing in his attempt to discredit the former staffer. For the above stated reasons, we request that OCE commence an immediate investigation into Rep. Gowdy’s conduct.” The complaint accused Gowdy of disclosing the information in order to defend the Benghazi committee’s work. In recent weeks, both Republicans and Democrats have suggested that the committee was “designed” to go after the Democratic presidential frontrunner. Brock echoed that charge in a statement provided to TPM. “Trey Gowdy’s disclosure is yet another example of him selectively sharing private information to influence the media and the public – now even his former Republican staffer, who dared to oppose him, has been made a victim,” Brock said in the statement. “Gowdy’s leak of Podliska’s dispute resolution is a clear violation of well-defined confidentiality provisions, and he must answer for his deliberate and flagrant violation of the law.” More:

Ben Carson had extensive relationship to dietary supplement company despite denial

(CNN)In Wednesday’s CNBC Republican presidential debate, Ben Carson was asked about his involvement with Mannatech, a dietary supplement maker. In 2009, Mannatech settled for $7 million following a lawsuit brought by the Texas attorney general over the company’s claims that its products could cure cancer and autism. CNBC moderator Carl Quintanilla claimed Carson had a 10-year-long connection with the company and that it continued even after the settlement. Carson denied the accusation, saying, “That is total propaganda … I did a couple speeches for them, I do speeches for other people, they were paid speeches. It is absolutely absurd to say that I had any kind of relationship with them.” Carson’s statement directly contradicts promotional material that came from Mannatech, as well as his own business manager Armstrong Williams, who described Carson’s relationship to the company in an interview Thursday on “The Lead with Jake Tapper.” Williams defended his boss, suggesting that while Carson did have a relationship to the company, the retired neurosurgeon didn’t realize all of the details of his endorsement up front and wanted out of the deal. “He said ‘I don’t believe in this. I’m not going to do it,'” Williams said, recalling negotiations with the company over the endorsement. “When that was over, he made it clear to me, ‘You need to get me out of this, I’m not going to do this again,’ and it was over.'”  The Wall Street Journal this month reported on Carson’s connection with Mannatech, saying Carson has said he has taken the company’s supplements for more than a decade. The WSJ also cited a 2004 video of Carson speaking at a Mannatech event. In the video, he credited the company’s products for his prostate cancer diagnosis symptoms disappearing. The paper points out that Carson is now “cancer-free after surgery.” The WSJ reports Carson has appeared in videos that were on Mannatech’s website until earlier this month. The videos were removed soon after the Journal’s reporting. The paper also reported that Carson gave four paid speeches at company events; the most recent was in 2013 for which Carson was paid $42,000. Carson’s campaign manager, Barry Bennett, told the WSJ Carson is a “believer in vitamins and supplements.” CNBC moderator Quintanilla also pointed out Carson’s image was on the Mannatech website’s homepage, with the firm’s logo prominently displayed over his shoulder. Carson said, “If somebody put me on the homepage, they did it without my permission.” More:

How 1994 Explains 2016

On the night of November 8, 1994, in the small kitchen on the second floor of the White House, Hillary Clinton stared at a television screen. The 47-year-old first lady, sitting with her husband and daughter, absorbed the news that Republicans all over the country were scoring jolting, overwhelming wins and a takeover of Congress. The rattled, disconsolate Clinton wondered how much she was to blame. Down in Miami, in a suite in the Crowne Plaza, Jeb Bush stared at a computer screen. Surrounded by his wife, his children, staffers and several reporters, the 41-year-old Republican candidate for governor of Florida had been running for office for 18 months and had been thinking about it for a lot longer than that. He watched the results roll in, showing the state’s closest such race in more than a century. But he knew. “I’m going down,” Bush said. He called his opponent around 11:30 p.m. to concede, then stayed up into the wee hours, smoking his first cigarette in years and drinking Scotch. Bush lost more than just the election in Florida that night, because his older brother won one in Texas. George W. Bush would get to be a governor, and Jeb Bush would have to wait, upending the family’s expectations and radically scrambling the brothers’ trajectories and presidential prospects. “Had Jeb won in ’94, he would’ve been the nominee in 2000,” anti-tax activist Grover Norquist tells me. Many people I talked to, from politicians to analysts to operatives, say the same thing. And Clinton’s failure in her zealous efforts at health care reform, hitched to her role in the debilitating Whitewater hassle, made her conservatives’ top target. “I don’t know what’s right anymore,” she confided that year to an adviser. “I don’t even trust my own judgment.” “If you want to see where modern Hillary starts,” Republican strategist Joe Brettell tells me, “that’s it—1994.” For both Clinton and Bush, 1994 was a year that looked bad then—but looks worse now. It was a year that changed them, and their lives, forever. It was a year when political opponents learned how to take them on—and win. It was a year when being Bill Clinton’s wife or George H.W. Bush’s son started to feel quite complicated for two aspirants who sought to stand on their own. It was a year, too, in which the new contours of our collective media mayhem began to become clear, with seminal moments in 24-7 news entertainment, reality television and the advent of the commercial Internet, and talk radio rumbling on behalf of Republicans. The far-seeing already were imagining hand-held miracle phones.

Health Care Companies in Merger Frenzy

In a fast-paced financial version of musical chairs, health care companies of all kinds — drug makers, hospital groups and insurers — have been frantically circling to be sure they are not left out of the latest frenzy of deal making. Mergers and acquisitions worth about $270 billion have been announced in the first nine months of 2015 in the United States, easily outpacing the activity in recent years, according to a tally by Mergermarket. On Thursday, Allergan, itself the product of a recent merger, said it was in talks to be bought by Pfizer in a deal that could easily become the year’s biggest deal. Allergan’s current market value is $113 billion. But the quest for size goes beyond the drug industry. The year’s biggest deals included mergers among the nation’s five largest health insurance companies, which pursued one another until only three may remain. Anthem is trying to buy Cigna for nearly $50 billion, and Aetna is pursuing Humana. Only UnitedHealth Group remains without a partner. But UnitedHealth, which has created a portfolio of health care businesses, fortified its pharmacy benefit manager, known as OptumRx, by buying Catamaran Corporation a fast-growing competitor, this year. The combined entity, which is expected to process more than one billion prescriptions in 2015, is better equipped to compete with the industry giants Express Scripts and CVS Health, which operates CVS/caremark in addition to drugstores. CVS, in turn, acquired Omnicare to broaden its reach into nursing homes and bought 1,700 pharmacies from Target. Not to be outdone, earlier this week, Walgreens Boots Alliance, the giant drugstore chain, said it planned to buy Rite Aid, a competitor. The activity has been dizzying among pharmaceutical companies, always in the market for a promising new drug or pipeline.

You’re About to Get Too Expensive for Your Pension Plan

The federal budget deal could speed the long, lingering death of old-fashioned defined-benefit pension plans, in which employers reward years of service by providing a guaranteed stream of income in retirement. The deal could affect any pre-retiree in a former employer’s pension plan1 by increasing the per-head premiums that plan sponsors must pay to the Pension Benefit Guaranty Corp. If it goes through as written, every person in a plan will get more expensive at the stroke of a pen. Employers are already deeply concerned about the extent and uncertainty of future pension liabilities and are trying to shed them. The proposed increase in the budget legislation would push even more pension plans to manage costs any way they can, including reducing participant head count, said Alan Glickstein, a senior retirement consultant with Towers Watson. The budget deal calls for a 22 percent hike, spread out over three years, in flat-rate, single-employer premiums paid to the PBGC, which acts as a backstop to a company’s pension liability should the company become insolvent. Those premiums will already have risen from $31 in 2007 to $64 in 2016; by 2019 they will reach $782. An increasingly common way companies get rid of those liabilities is by offering participants a chance to take their pensions all at once, as lump sums based on the present value of their future benefits.3 After strong years for such offers in 2013 and 2014, the activity rose dramatically in 2015, said Matt McDaniel, who leads Mercer’s U.S. defined-benefit risk practice. More lump-sum deals aren’t good news for employees, about 40 percent to 60 percent of whom take the deals. Most who take lump sums of less than $50,000 cash those retirement funds out rather than roll them into an IRA, paying income tax and a 10 percent penalty if they aren’t at least 59½. While it depends on individual circumstances, it usually makes more financial sense to leave the money in the plan and have it trickle out during retirement. More:–igccrjxr

Anonymous Is Threatening to Out the Names of a Thousand KKK Members

Hacker collective Anonymous is at it again, and this time its target is the most notorious racist organization in the United States. In a statement on Wednesday, the collective threatened to reveal the identities of up to a thousand Ku Kluk Klan members and affiliates across the United States. “After closely observing so many of you for so very long, we feel confident that applying transparency to your organizational cells is the right, just, appropriate and only course of action. You are abhorrent. Criminal,” the group wrote. “The privacy of the Ku Klux Klan no longer exists in cyberspace.”  The threat comes after a year of conflict between the two groups, set off by the shooting of Michael Brown, an unarmed black man, by a policeman in Ferguson, Missouri. In November 2014, a Missouri-based KKK group threatened to attack Ferguson protesters against police brutality, claiming KKK members would use “lethal force” to defend themselves. Anonymous responded with #OpKKK and #HoodsOff, hacking into supposed KKK-related social media accounts and revealing personal information, including photos, addresses, and phone numbers of the people behind the accounts. Now, almost a year after Ferguson, Anonymous has renewed its threats. Some people have responded, asking Anonymous to focus on law enforcement.

A witch takes a warlock to court. Where? Salem, Mass., of course.

Lori Bruno-Sforza claims the harassment began about three years ago. It included phone calls in the middle of the night, she alleged, and vulgar language. She believed the culprit was a man named Christian Day, and she went to court with her accusations. Judge Robert Brennan this week sided with Bruno-Sforza, and issued a harassment prevention order against Day. These types of cases aren’t that uncommon, really. Acquaintances get angry at each other, relationships sour, disputes end up in court. So what makes this one so notable? Bruno-Sforza is a witch priestess, Day is a warlock, and Brennan is a District Court judge in Salem, Mass., a community made famous by its … well … rich witch-related legal history. “How do I feel?” Bruno-Sforza told The Washington Post in a phone interview Thursday. “Justice is served.” Day denies making the calls. “Here’s the thing,” said Day, also speaking to The Post, “I don’t know that the judge had much choice given the fact that there were dozens of television cameras in every direction, and who wants to seem like they’re ruling against a little old lady?” He tweeted an upbeat tweet Wednesday night: “Truth is self evident. So is magic. Live, love, and rise above! Happy October everyone!” Day, described on his Web site as “the world’s best-known warlock,” owns witchcraft shops in New Orleans and Salem, and is also involved in the Festival of the Dead, an annual event in Salem. More:


Alabama Teacher of the Year who left Mountain Brook for Birmingham is resigning

Ann Marie Corgill, 2015 National Teacher of the Year finalist and 2014-2015 Alabama Teacher of the Year, has submitted a letter of resignation to Birmingham City Schools. Corgill, a fifth-grade teacher at Oliver Elementary School, moved to the Birmingham school district after teaching at Cherokee Bend Elementary School for three years – a move widely considered a step in the right direction for the Birmingham City Schools. But in the letter obtained by, she cited confusion about her certification after Birmingham and Alabama Department of Education officials recently informed her she was not qualified to teach fifth grade. “After 21 years of teaching in grades 1-6, I have no answers as to why this is a problem now, so instead of paying more fees, taking more tests and proving once again that I am qualified to teach, I am resigning,” she wrote. Birmingham City Schools spokeswoman Chanda Temple said the district is currently working through the situation and had no further comment Thursday morning. Corgill started this school year at Oliver Elementary teaching second grade. But shortly after the semester began, she wrote, she was moved to a fifth-grade classroom. According to teacher certification records provided by the Alabama Department of Education, Corgill has Class A and B certifications to teach primary school through third grade students.  But Corgill also holds National Board Certification to teach children ages 7-12, an age group that would include most fifth graders. That certification is valid until November 2020, according to the National Board Certification directory. “Kennita Allen, (an Alabama Department of Education official), informed me yesterday over the phone that National Board Certification does not replace or override an Alabama K-6 certificate,” Corgill wrote in the letter. But at her previous job at Cherokee Bend Elementary, Corgill taught fourth grade, which is outside the state’s certification. Corgill was named Alabama Teacher of the Year for 2014-2015 school year. She has taught for more than 20 years in the cities of Hoover, Trussville, New York City and Mountain Brook. She also wrote a book, “Of Primary Importance: What’s Essential In Teaching Young Writers,” and is working on a second book about quality instruction. Oliver Elementary is part of the Woodlawn Innovation Network, a charter school-like system that allows unique education standards, including the recruitment of teachers and leaders without traditional teaching certificates. In addition to the confusion over her certification, Corgill wrote that she did not receive a paycheck from the district until Oct. 23 – two months after school started – and still has not received an explanation from district officials. “Please know that I wanted to give my all and share my expertise with Birmingham City Schools,” she wrote. “In order to attract and retain the best teachers, we must feel trusted, valued and treated as professionals. It is my hope that my experience can inform new decisions, policies and procedures to make Birmingham City Schools a place everyone wants to work and learn.” Corgill was not immediately available to comment Thursday morning.

These are the politicians eyeing a run for Alabama’s highest offices in 2018

The 2016 election cycle is in full swing, but outside of a potentially competitive congressional race in Alabama’s 2nd District, there’s not a lot of action in the Yellowhammer State this year. However, if you think it’s too early to start looking toward the impending electoral chaos of 2018… Well, you’re probably right. But make no mistake, Alabama’s most ambitious politicians are already jockeying for position. Yellowhammer released a list of the “Top 20 potential 2018 Alabama gubernatorial candidates” earlier this year. It included a pretty good number of long shots and individuals who probably won’t actually end up running, and that list did not include any of the other statewide offices that the political climbers are keeping an eye on. So let’s take a quick look at some of the politicians who are already eyeballing the state’s highest offices that will be up for grabs in 2018:

Alabama Congressional delegation splits on budget deal vote

The Alabama Congressional delegation split votes Wednesday as the U.S. House of Representatives approved a two-year bipartisan budget agreement.It was not your typical split however, as Republican Congressman Mike Rogers (AL-03) joined Democrat Rep. Terri Sewell (AL-07) in supporting the bill, making him one of only 79 Republicans to support the measure along with 187 Democrats. The rest of the delegation — Reps. Bradley Byrne (AL-01), Martha Roby (AL-02), Robert Aderholt (AL-04), Mo Brooks (AL-05) and Gary Palmer (AL-06) — were among 167 representatives, all Republicans, who voted against. The Bipartisan Budget Act of 2015 would raise the $18.1 trillion debt limit by $1.5 trillion until March 15, 2017, after the next President assumes office. The bill also would raise sequester spending caps by $50 billion in fiscal 2016 and $30 billion in 2017 and would make changes to the Social Security disability program. “Our national debt currently exceeds $18 trillion and this budget deal would guarantee it increases,” said Palmer who voted against the bill. “It continues the too familiar trend of spending money now with hopes of finding ways to pay for it in the future.  For instance, $35 billion of the pay for’s occur in 2025, which is simply unacceptable. Instead of passing this bill, which pushes us in the wrong direction by increasing spending and raising the debt limit, we should have answered the call of the American people to reduce the national debt and balance our budget.” Rep. Sewell sees things differently. “While this bill is not a perfect one, the Bipartisan Budget Act of 2015 breaks the sequester stronghold that has stifled our domestic and defense spending priorities,” Sewell began. “Alabama was hit hard when the sequester was implemented, and this bill loosens the arbitrary spending caps that hampered critical investments in domestic programs. The nonpartisan Congressional Budget Office estimates that the direct effect of the budget agreement will create 340,000 additional new jobs in 2016, and a total of 500,000 jobs by 2017. These jobs are critically important to hardworking Americans who continue to struggle to make ends meet and provide for their families.” The bill now heads to the Senate where it is expected to be taken up quickly. Once there, Alabama Senators Jeff Sessions and Richard Shelby have indicated they both would reject the agreement.

McGraw Hill will remain at its lower Manhattan headquarters

McGraw Hill Financial is close to renewing the lease for its lower Manhattan headquarters, according to several people familiar with the deal. The transaction, which is expected to be completed before the end of the year, will be one of the city’s largest leasing deals of 2015. The company, which owns Standard & Poor’s Ratings Services and stock indices, will hold onto its 1.1 million square feet of space at 55 Water St., the largest office building in the city, based on square footage, at 3.6 million. A spokesman for McGraw Hill Financial declined to comment. The space at 55 Water St. was first leased by Standard & Poor’s in 1999. Earlier this year, McGraw Hill Financial, formerly known as McGraw Hill Cos., moved its headquarters into the S&P space from 1221 Sixth Ave. The firm has sold off its publishing and textbook businesses and changed its name to reflect its focus on financial data services. In recent months, it has contemplated selling off J.D. Power, its customer satisfaction survey subsidiary. As it began to focus on fewer core businesses, the shift downtown resulted in McGraw Hill shedding the hundreds of thousands of square feet it once had at 1221 Sixth Ave. McGraw Hill Financial’s existing lease at 55 Water St. doesn’t expire until 2020, according to sources. However, tenants with big office space requirements make decisions years in advance because of the high financial stakes riding on their occupancy and the time it takes to arrange big deals can take months, if not longer.  The 52-story lower Manhattan tower is owned by the pension fund Retirement Systems of Alabama, which is represented by a team from CBRE led by Mary Ann Tighe, Howard Fiddle, Evan Haskell and Brad Gerla.


“Legislature elected in 2010 is the worst in the history of Alabama – period” – Dr. Gerald Johnson

A prominent long-time observer of Alabama history says the Republican supermajority Legislature elected in 2010 is the worst in the history of Alabama – period. Dr. Gerald Johnson, a retired professor of political science at Auburn University, said it didn’t help that the GOP took over with the aim of settling some political scores. And Johnson, the former pollster for the Alabama Education Association, says the stances taken by the GOP supermajority have wound up hurting the Republican Party and “the governance and welfare of Alabama.” Johnson, who has seen Alabama legislatures come and go for decades, made his comments in remarks to the Auburn Democratic Club on Oct. 21. “As Lord Acton wrote in 1887, ‘power tends to corrupt, and absolute power corrupts absolutely,’” Johnson said in describing the Republican supermajority. House Speaker Mike Hubbard of Auburn and Senate President Del Marsh of Anniston engineered the GOP takeover of the Legislature in 2010 in a year when Republicans swept every statewide office. Johnson quoted a former unnamed Republican state senator as saying that corruption had become so rampant and widespread that the attorney general’s office launched a far-reaching investigation into corruption into Statehouse corruption. For months there was speculation that a state grand jury was specifically investigating Hubbard. Although Marsh was never named as a target of the probe, he retained a well-known Montgomery attorney as the investigation proceeded. Johnson noted that Rep. Greg Wren, R-Montgomery, who had made several appearances before a Lee County grand jury investigating Hubbard, pleaded guilty on April 1 to an ethics charge, and resigned from the Legislature as a condition of his plea deal and was given a 12-month suspended sentence and fined $24,000. Wren pleaded guilty to using his office for personal gain. Hubbard was subsequently indicted six months later on 23 felony counts that charge him with using his office for personal gain. He is scheduled to go on trial in Lee County in March 2016. But criminal charges against Hubbard, the most powerful member of the Legislature, aren’t the argument that Johnson made in deeming this Legislature the worst ever. Johnson said the Legislature has failed to meet three essential requirements of a representative democracy. “Legislators must be representative of voters who elected them, they must be open and democratic and they must reflect the will of the people,” he said. “Based on these three criteria, the Alabama Legislature failed to do more than other any legislature in the history of Alabama.” Johnson also pointed out the lack of overall representation among the Republican supermajority in the Legislature, which is 95 percent male and 100 percent white. Meanwhile, he noted registered voters in Alabama are only 56 percent male and 26 percent African-American. “The supermajority doesn’t represent the Alabama electorate in numerical terms and the supermajority  legislative process failed to represent the electorate in terms of democratic processes,” said Johnson. The GOP has rammed bills through the House and Senate without debate and used cloture to cut off debate on bills much more frequently than when Democrats controlled the Legislature, Johnson said. “The result of a closed and secretive legislative process is poor quality and bad public policy,” he said. “Almost every piece of major legislation enacted has, in part, been nullified by the courts or is now in the courts, at great expense to the state. Some bills introduced were so clearly unconstitutional that the bill included a provision that no state funds could be used to defend the constitutionality of the bill.” Johnson specifically mentioned the highly controversial 2014 voucher act that has been used to shift millions of public education dollars to private and church school students. Johnson noted the Alabama Accountability Act was enacted in secret by the Republican supermajority while 70 percent of Alabama voters oppose the law, including 64 percent of Republicans. And 92 percent of voters oppose how it was clandestinely enacted. “By far the most serious failure of the supermajority is the disconnect from the people caused by a lack of representation and abuse of the democratic processes,” he said. Also conflicting with the GOP supermajority, said Johnson, 77 percent of Alabama voters oppose allowing an 18-year-old a pistol packing permit and having loaded pistols in vehicles without a permit, 60 percent support Medicaid expansion, 88 percent support a minimum wage increase, 84 percent support a public vote on allowing, regulating and taxing a state lottery, 70 percent support reform of public schools rather than alternatives to public schools such as vouchers or tax credits, and 72 percent believe public education should be a constitutional right and the legislature should have the responsibility to fund public schools. Even on moral issues such as abortion, Alabama voters, contrary to the Republican supermajority, oppose a ban on all abortions and support reasonable exceptions, said Johnson. Voters also oppose allowing Christian only prayers and religious activities in public schools. But the GOP supermajority did represent the public in cutting government and public spending, he said. Alabama has slashed public school funding more than any state in the nation. At the same time, Johnson said, education dollars have been used to subsidize new industries while Alabama ranks 49th in the creation of new jobs. And underfunded prisons and other state programs and services are endangered, including by federal government intervention. The GOP supermajority successfully overturned the legislative pay raise enacted by the previous legislatures controlled by Democrats. But Johnson noted that what the Republicans subsequently enacted raised the total compensation of legislators and provided for automatic increases in the future. And the Republicans redistricted to assure for the foreseeable future that the legislative membership will be fixed in terms of minority representation by packing and creating “ghetto” black districts, said Johnson. “And, in the guise of honest election laws to address all but non-existent voter fraud,” he said the GOP approved voter ID legislation that makes it more difficult to vote. “These are the indisputable facts,” Johnson added. “Elections have consequences. The result is the worst legislature in the history of Alabama.” (Bob Lowry spent more than three decades as a journalist, most of it with United Press International in Montgomery and Austin, Texas. He was also a reporter/editor for the Montgomery Advertiser and The Decatur Daily. His final stop was as Montgomery correspondent for The Huntsville He can be reached at:; Follow him on Twitter @SunnySouthAL )

The Insiders: How will things be different for Speaker Ryan?

In a lot of ways, newly elected House Speaker Paul Ryan (R-Wis.) and former speaker John Boehner (R-Ohio) are cut from the same cloth. Both are sensible, principled conservatives who came from humble beginnings in the Midwest and rose through the ranks of Congress. Both are well-respected within most of the Republican caucus and are generally popular within the Republican Party. But Boehner had an ongoing battle with and was under constant attack from part of the right wing of the party. So what’s going to be different for Speaker Ryan? Why won’t he be inheriting the same problems Boehner had? Has something made the purity caucus in the House decide to stand down? While the most obstinate Republicans have not signed a oath pledging they will no longer be intellectually dishonest, marginalized whack jobs, and there is no peace treaty between the so-called Freedom Caucus and the Republican leadership, it doesn’t look like Ryan will have to fight many of the same fights that Boehner faced — at least not until after the next elections. The fact is, after talking to a lot of experienced Hill players, it seems most of the changes between the Boehner and Ryan speakerships will be subtle. The complaints against Boehner were never particularly precise, but Ryan is generally viewed as more tuned in to the sentiments of the wider Republican caucus. Plus, Ryan gets credit for being more of a fresh face and is mostly thought of as more conservative than Boehner. Also, Ryan is an able performer from behind the podium and on TV. He will be more visible than Senate Majority Leader Mitch McConnell (R-Ky.) and likely more outspoken than Boehner was. Actually, for a Republican, Ryan likes dealing with the media. Someone close to him told me that Ryan thinks he always learns something when he talks with a smart member of the media. And, oh, by the way, Boehner has done the new speaker and the entire GOP a favor. Assuming the budget deal makes it through the Senate, many of the recurring budget fights that have been so divisive and unflattering for the GOP brand will be off the table for a while. Plus, for better or worse, Ryan won’t be confronted with the difficulty of dealing with the White House on any important matters. This president has quit trying to pass things through Congress.  The victory lap President Obama is taking to conclude his presidency will not include any new undertakings with Congress. It is well known that this White House, starting with the president, doesn’t understand the importance of congressional relationships and was never a credible negotiating partner. Every time Boehner had to conduct negotiations with the president, it inevitably made Boehner look bad and never produced a positive result. The bottom line is, more of the Republican caucus is invested in Ryan’s speakership than with John Boehner, so we could start to see some unity within the party as we move toward the 2016 elections. Also, one thought on last night’s debate: Sen. Marco Rubio (R-Fla.) was obviously the big winner. He needed to do three things. One, he needed a breakthrough to stimulate his fundraising. Two, he needed to show that his talents go beyond his rehearsed, well-worn — but effective — stump speech.  Granted, he does have the best podium presence of anyone in the field, but he needed to show he isn’t just a one-trick pony. And third, he needed to win a round with former Florida governor Jeb Bush. Well, Rubio did all three, and he is stronger as a result. The Post’s Karen Tumulty asks, “Has the Marco Moment arrived?” The answer is yes. It’s probably Rubio’s time with the Cinderella slipper, and at least for the next few weeks, he will be the man to watch.


Morning Money

MORE RUBIO WALL STREET LOVE — Another Wall Streeter’s emailed take on the debate winners: “Rubio clear winner, with Christie, Trump, Cruz, and Carson also doing well, in that order. The beatings Trump and Rubio delivered to Kasich and Jeb (respectively) were entertaining. … Cruz continues to peddle along, maintaining his 7-10 percent level of support as a viable candidate who could explode late. If Rubio was 3 inches taller, we could crown him the nominee tonight. Instead, we wait until he locks it up in April.

Losers: “Kasich and Jeb have flatlined. They seem to have a remarkably poor understanding of what GOP voters want. Both are toast, though they could linger for a few more weeks or even into January. … Irrelevant: Huckabee and Rand. Judgment has been rendered. They aren’t disliked. They’re just forgotten.”

TWEETS OF THE NIGHT — Rand Paul on the budget deal as it appeared headed for final Senate passage early this morning: “This deal gives the President the power to borrow unlimited amounts of money.” … In fact, unless it re-writes the U.S. Constitution, it actually does no such thing. How do people get away with this stuff?

RUBIO GOES AFTER BUSH DONORS — POLITICO’s Eli Stokols: “For months, Republican donors viewed Marco Rubio as a growth stock. After his bull run in Wednesday’s debate, investors are buying. It started even before the debate in Boulder ended. Donors who had been getting calls from Rubio’s Colorado campaign chairman for two months were suddenly emailing him. Seven donors he’d been working couldn’t convey their messages fast enough: I’m in.”

“‘The movement in donors and activists is significant and palpable,’ said Josh Penry. ‘People saw Marco last night and they saw a conservative and they saw a winner. The people who always liked him but doubted his polish now see a guy on stage they can see next to Hillary Clinton.’ What Penry felt in Colorado was happening nationwide. In the hours after the debate, Rubio’s campaign saw its online fundraising numbers skyrocket. As of 3 p.m. Thursday, Rubio had raised $750,000 in online contributions from more than 14,000 unique donations”

BIG DRUG MERGER RAISES ALARMS — Reuters’s Bill Berkot and Randsell Pierson: “Pfizer Inc, the No. 1 U.S. drugmaker, and Botox maker Allergan Plc said they were in friendly talks to create a pharmaceutical colossus but the prospect that the company would seek to avoid U.S. taxes sounded political alarm bells. … Both New York-based Pfizer and Dublin-based Allergan said no agreement has been reached and declined to discuss any terms of the deal, which would potentially set up Pfizer to take advantage of Ireland’s lower tax rates. …

“Pfizer is already facing political pushback at home that is only likely to intensify with the U.S. presidential campaign underway, as candidates take aim at high prescription drug prices and companies looking to avoid paying U.S. taxes. A spokesman for Democratic front-runner Hillary Clinton said the candidate had not seen details of the proposed merger, but is against tax inversion maneuvers … Donald Trump said the deal was a reminder that the U.S. tax code needed an overhaul”

GDP: BAD BUT NOT AWFUL — Per PNC: “The U.S. economy expanded 1.5 percent at an annual rate in the third quarter … This was a significant slowing from 3.9 percent growth in the second quarter. But the details of the report were much better than the headline. Inventories subtracted 1.4 percentage points from growth, the biggest drag from inventories since 2012 … Final sales of domestic product, which measures demand for U.S.-produced gods and services, rose a very respectable 3.0 percent in the second quarter. Consumer spending rose 3.2 percent at an annual rate”

Manulife’s Megan Greene: “Q3 GDP in the US was a disappointment, but not at all a surprise. … Consumers have been using the savings they have accrued at the gas pump to repair household balance sheets and save. Household debt/incomes remains well above the average in the 1980’s and 1990’s, suggesting there is more deleveraging to be done. We can expect more destocking — and a further drag to GDP growth — in Q4. US GDP growth should come in just below 2.5 percent for the year.”

HOW THIS EXPANSION COMPARES: NOT GREAT — Via HPS: “At 78 months in the current expansion, we’ve now matched the average length of expansions since 1980, but the average annual growth is a full percentage point below those previous recoveries at 2.2 percent this cycle versus 3.2 percent in recoveries since 1980.”

FED COULD FORCE CHANGES AT WELLS — WSJ’s Ryan Tracy and Emily Glazer: “Do regulators consider Wells Fargo & Co. one of America’s safest, most stable megabanks? Or one of the riskiest? The answer depends on which measure is used. New rules to be proposed by the Federal Reserve on Friday likely will force the San Francisco bank — more than some of its rivals — to make significant changes to its balance sheet, even though Wells Fargo has fared better than competitors in earlier tests on safety and soundness.

“As a result, Wells Fargo — America’s fourth-largest bank by assets, known for a relatively simple, traditional business model focused on the domestic deposit-and-loan business — may have to raise about $26 billion or more in new long-term debt, depending on the proposal’s fine print, adding more complexity to its finances and possibly trimming profit slightly with higher interest payments … In anticipation of the rule, Wells Fargo executives already have been traveling the globe selling new debt. At issue is the next stage of postcrisis regulation coming from the Federal Reserve, governing ‘total loss-absorbing capital,’ or TLAC.”

CARSON DEEPLY INVOLVED WITH MANNATECH — CNN’s Chip Grabow: “In Wednesday’s CNBC Republican presidential debate, Ben Carson was asked about his involvement with Mannatech, a dietary supplement maker. In 2009, Mannatech settled for $7 million following a lawsuit brought by the Texas attorney general over the company’s claims that its products could cure cancer and autism. CNBC moderator Carl Quintanilla claimed Carson had a 10-year-long connection with the company and that it continued even after the settlement.

“Carson denied the accusation, saying, ‘That is total propaganda … I did a couple speeches for them, I do speeches for other people, they were paid speeches. It is absolutely absurd to say that I had any kind of relationship with them.’ Carson’s statement directly contradicts promotional material that came from Mannatech, as well as his own business manager Armstrong Williams’

LET’S NOT FORGET … Carl Quintanilla got heartily booed for having the temerity to even ask this question …

GOOD FRIDAY MORNING — Hope everyone has a happy Halloween! Email me on and follow me on Twitter @morningmoneyben.

DRIVING THE DAY — FDIC at 10:00 a.m. holds a meeting of the FDIC Advisory Committee on Economic Inclusion … Brookings holds a discussion at 10:00 a.m. on interest rates … SEC at 10:00 a.m. will vote to adopt final rules to allow equity “crowdfunding” for businesses … Fed holds a meeting of the Board of Governors … Personal Income and Spending at 8:30 a.m. each expected to rise 0.2 percent … Univ. of Michigan Consumer Sentiment at 10:00 a.m. expected to be flat

THIS MORNING ON POLITICO PRO FINANCIAL SERVICES — Jon Prior on White House efforts to address affordable rental housing []. For Pro’s subscriber-only coverage — and to get Morning Money every day before 6 a.m. — please contact Pro Services at (703) 341-4600 or

CNBC SETS RATINGS RECORD — Per release: “CNBC’s Republican Presidential Debate was the most-watched telecast on television last night beating Game 2 of the World Series. Among adults 25-54 and adults 18-49, CNBC’s Republican Presidential Debate was Wednesday’s most-watched cable telecast. CNBC’s Republican Presidential Debate averaged 14.0 million total viewers, 3.9 million adults 25-54 and 3.4 million adults 18-49, making it CNBC’s most-watched telecast in network history”

BACKSTAGE AT THE CARNIVAL — POLITICO Magazine’s Campaign Issue Now Live! The Campaign Issue appears on newsstands almost exactly a year before voters head to the polls. The issue features an investigation into the Clinton email server scandal, a profile of Kasich’s campaign manager providing an in-depth look at staffers and the business of a major league campaign, missives from the campaign trail with Huckabee and a profile of how Cuba affected the life and politics of Rubio.

CHINA DROPS ONE CHILD POLICY … WAY TOO LATE — Bloomberg: “For all the historic significance of China’s decision to abandon its one-child policy, the move risks falling well short of reversing a trend that threatens to throttle economic growth. It’s ‘too little, too late,’ said Shanghai-based Andy Xie, a former Morgan Stanley chief Asia economist, about the Communist Party’s approval of plans to allow all couples to have two children. ‘The population will begin to decline in 10 years. Why keep population planning?’ …

“The official Xinhua New Agency reported the new policy on Thursday at the end of a four-day party gathering in Beijing. The relaxation is part of President Xi Jinping’s five-year blueprint for transition to a ‘moderately prosperous society.’ As the days of cheap and abundant labor fade, old growth drivers such as manufacturing and construction are stalling. While China’s aging population may boost consumption’s contribution to the economy, the challenge is ensuring economic dynamism doesn’t fade as the share of young people shrinks, as it has in Japan.”

CAN JEB COME BACK? — WP’s Philip Rucker, Dan Balz and Ed O’Keefe: “Jeb Bush’s presidential campaign was at an inflection point Thursday as the candidate faced a choice of sticking with his long-term strategy or yielding to criticism from supporters and senior Republicans who are demanding fundamental changes to his sputtering candidacy.
Significant concerns about Bush’s performance were magnified on the debate stage here Wednesday night, and the former Florida governor awoke to his harshest criticism yet.

“Bush faces the real possibility that a substantial amount of money and momentum will move to Sen. Marco Rubio (Fla.) as the party’s mainstream conservative wing’s favored candidate unless he moves quickly to rebalance his candidacy. ‘I could have done better,’ Bush conceded on a conference call Thursday afternoon with top donors and state chairs … His debilitating performance was for many allies a cause for alarm. … Interviews Thursday with strategists and fundraisers throughout the Republican firmament underscored that there are no particularly attractive options for Bush to breathe new life into his campaign.”

AIG FACES PRESSURE TO BREAK UP — WSJ’s Joann S. Lublin and Leslie Scism: “American International Group Inc. directors are discussing a spinoff or sale of AIG’s small mortgage-insurance business as the conglomerate faces new shareholder pressure to break apart … The discussions have been under way for a while, and no final decision has been made about the unit, which sells coverage that protects mortgage investors and lenders against losses … AIG’s mortgage-insurance operation is considerably smaller than AIG’s other businesses, representing roughly 5 percent of pretax operating profit during the second quarter.

“But it posted the largest increase in pretax income during the first six months of 2015. AIG is one of the world’s largest insurance companies, with a market value of roughly $82 billion. The separation of AIG’s mortgage insurer would fall short of calls from shareholders Carl Icahn and John Paulson to break AIG into three pieces — mortgages, life and property-casualty. AIG had to be rescued during the 2008 financial crisis in one of the biggest bailouts by the U.S. government. It finished paying taxpayers in late 2012 and has been struggling since to boost critical measures of profitability as it battles pricing pressures”

RUBIO STEPS INTO THE SPOTLIGHT — NYT’s Jeremy W. Peters and Maggie Haberman: “Measured but optimistic, Senator Marco Rubio on Thursday stepped into the spotlight he always feared would come too early in the campaign and prepared for a bruising collision with Jeb Bush, his friend, neighbor and onetime political partner … But as Mr. Rubio and his supporters tried not to be swept up in the euphoria over his performance in Wednesday night’s debate, the mood among Mr. Bush’s supporters was despondent …

“With the attacks on Mr. Rubio landing hard — from Mr. Bush and Democrats, and focused on his spotty voting history, thin record of legislative accomplishment and short time in national office — the senator and his senior advisers moved quickly to woo the establishment wing of the Republican Party that Mr. Bush was once thought to have locked up. Even as top Rubio advisers expressed confidence, they delivered a plea to their donors and supporters to redouble efforts in fund-raising, which remains the campaign’s most serious obstacle to beating Mr. Bush.”

POTUS Events

10:30 AM The President and the Vice President receive the Presidential Daily Briefing

Oval Office Closed Press

12:30 PM Press Briefing by Press Secretary Josh Earnest
5:15 PM The President and the First Lady welcome local children and children of military families to trick-or-treat at the White House

South Portico Pooled Press Pre-Set 3:00PM; Final Gather 5:00PM – North Doors of the Palm Room


Floor Action

Congress is out for the remainder of its “French work-week.” The Senate is also gone after working, well, pretty much all night.