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Even with a lower troop committment, the new costs of $ 1 million a year for each soldier, threaten to wipe out the $26 billion in savings from Iraq in 2010. The overall military budget could go up by 10% from a high of $667 billion under the Bush administration to $734 billion. Head of the House Appropriations Committee, David Obey, of Wisconsin, says that sending more troops to Afghanistan would drain the Treasury, and "devour virtually any other priorities that the President or anyone in Congress had." Rep. John Murtha of Pennsylvania head of a House subcommitte on defense appropriations says that a majority of the 258 Democrats in Congress would vote against any bill to pay for more troops.

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President Biden faces three potential crises this month -one in Ukraine with a buildup of Russian forces for potential invasion, Chinese actions with Taiwan, and potential collapse of Iran nuclear talks. Biden also convenes this week world leaders of democracies in virtual talks on how to respond to actions of Russia, China, Iran and other countries. Biden's goal is to ensure the US and its allies remain strong without provoking crises.

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Bret Stephens of the WSJ puts the -question what is Pakistan? And looks at possible answers. Starting with Mohammed Ali Jinnah, who he says had aquite different idea from that of the Taliban. He quotes Jinnah 'you will find that in the course of time Hindus would cease to be Hindus, and Muslims cease to be Muslims , not in the religious sense, because this is the personal faith of each individual, but in the political sense as citizens of the State." His idea was of religion as apolitical identification of the state as opposed to asecular idea like that of India, not of a religious state in a religious sense.This Bret Stephens says is why a majority of Pakistanis have rejected religious parties at the polls but still find the idea of political religion identification appealing. He sees these aims as immodest or overreaching in the modern world of technology, mass communications and economic deveopment. Only by remaining backward can such aspirations be supported because economic development, technology and mass communications can only supplant such religious politcal identification with aspirations for higher standards of living. Witness the current general elections in India with 730 million people voters. The common driving force for all parties is how they can deliver on the economic aspirations of people for better living standards, better infrastructure, and better services such as health care and education. And communal parties like the BJP also have to shift their focus to delivering on these aspirations to get support. So Bret Sephens makes the point quite effectively when he says that the threat to Pakistan is existential, so he would like to put the point existentially - just accept simple countryhood, or face nothingness. ...

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Does housing and rising oil prices combine to affect growth and by how much. Note the comments about oil prices. That cost of producing a barrel is only $25 a barrel, thats the average cost according to John Herold Inc. a research company for finding oil, developing the field,pumping it, and delivering it to storage. Oil Analytics president Fingerman thinks prices at $85 are not supported by fundamentals and prices should be $30 to $40 lower. Fadel Gheit of Oppenheimer also thinks industry fundamentals do not support prices above $60. What will this do in the long run? Will China's growth slow after the Olympics? Are alternative fuels and more fuel efficient cars, and a shift to smaller cars, and even electric cars, going to have an impact down the road in gasoline consumption. Geopolitical instability from Nigeria, Iran and most recently Kurish Iraq and Turkey has been part of the runup in oil prices, also insufficient inventory buildup for the winter season, and the generally low rates of replenishment of oil that is being consumed with new exploration. How many of these factors may reverse in the coming years? ...

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As Russia makes gains in the whole Donetsk region in eastern Ukraine the UK approves use of its long range missiles inside Russia. Biden is on the verge of making a similar decision as Iran sends long range ballistic missiles to Russia according to reports in NYT. Use of American long range missiles is not expected to affect Russia's overall military position in the Donetsk region in the east. The US and president Biden has only reluctantly provided support for use of US weapons systems to not risk escalating the war. Even artillery on the Russian side was off the list of approved use till Russia used it in Kharkiv border region at which point it was approved. Russians see Kiev as the origin of the Russian State in the 1400's, and eastern region of Donetsk as Russian if western Ukraine seeks to join NATO and EU. Britain has opposed Russia since 1750 as it saw Russia as the threat to an Empire it was building in South Asia, in India that financially supported its Empire worldwide. Britain has a long history of engaging Russia in conflict to protect British trade interests and expand its imperial influence as in the Crimean War fought in 1850's against Russia with the French to gain control of the Ottoman Empire and its Arab states for its trade and imperial interests. Republicans other than Mr. Trump and his supporters are for stronger support to Ukraine following US policy of opposing invasion to achieve military goals since 1900 against the Japanese in China and the Vietnam War was fought on the same basis in the 1960's considering the South Vietnamese state as an independent republic, just  invaded by the north, by North Vietnam, just as the US had done in the Korean War between North and South Korea. In the Vietnam War nationalism played apart with the Vietnamese nationalism prevailing by 1970.   ...

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DJT executive orders include one ending birthright citizenship. “It was really meant for children of slaves." DJT is referring to the 14th Amendment that was passed in 1868 by Congress and ratified by 1868 by the states. It came after the Civil War and Emancipation of slaves and was intended without any doubt for one and only one purpose to make slaves citizens of the United States Look at Section 4 of the 14th Amendment which says the United States will not allow any claim for the loss of any slave. "But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void. The only SC decision in US vs Wong Kim that gave citizenship in 1898 to Wong Kim was not intended to go beyond that particular case, it was only meant to make an exception to the Chinese Exclusion Act  of 1882 after which till 1960 (JFK's election) Chinese immigration to the US was stopped, and the same for all Asians. Only immigrant labor allowed in was from Mexico for agriculture till 1960. And in 1954 Operation Wetback wwas conducted by Eisenhower to return about 1 million illegal immigrants to Mexico. DJT says- “It was not meant for everyone to come into our country by airplane, or charging across the borders from all over the world and think they’re going to become citizens.” The millions that came illegally across land border  and the flow of drugs is a new situation that Congress and the Supreme Court are only facing since 2014 a period in which wars in Afghanistan and Iraq took time and resources away from problems at home. ...

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The Obama administration announced a policy of increasing the number of refugees accepted in fiscal 2017 to 110,000. This will be an increase from 85,000 in 2016, and 70,000 in the prior 3 years. Secretary of State Kerry says the target is consistent  with the idea that all countries need to do more, and if we could do more we would. After 3 years of cautious policy president Obama now follows Chancellor Merkel's lead.

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Technology is reshaping the world of oil by 2018. The U.S. Permian Basin stretching from West Texas to New Mexico now produces more oil than the UAE and is likely to soon surpass Iran- production is at 3.1 million barrels a a day. There are as many rigs as in 2011 yet the production has tripled because of the use of high tech rigs that can move quickly to new locations over wide areas and with tech that can see hundreds of feet into the rock. By 2019 the U.S. will surpass Russia as the world's largest producer of oil. The drop in oil prices to about $40 a barrel in recent years is a result of Saudi efforts to block shale oil development by lowering prices. This has not worked. Initially some high cost producers exited the industry and the shale industry suffered. Over time the new technologies spurred by lower oil prices have led to the anticipated drop in cost. Shale oil can now be produced by core producers at $40 a barrel and still be profitable according to this WSJ report. All Middle Eastern countries cannot meet budget needs at $40 a barrel. In 2018 oil prices increased back up to $77 a barrel. In the next wave of declining prices the shale industry is better positioned than the OPEC countries.   ...

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CERA study of 811 oil fields show that depletion rates will be 4.5% worldwide. Schlumberger's estimate is higher at 8%. CERA is on the optimistic side when it sees two Irans making up for one Iran lost. CERA estimates by 2017 33 million barrels a day will be lost from depletion. still it believes production would go up by 59 million barrels a day to 112 barrels a day. How can it say 59 its anoptimistic estimate of new stuff that will come out of the Caspian, Africa, Russia and other places in Asia and upto now unknown places. The reason its hard to estimate depletion is that OPEC and Russia are not sharing the data. CERA's estimate includes also stuff that comes from biofuels and natural gas liquids as half of that 59. As that 59 is 6 times today's Saudi output the estimates are coming under criticism and not widely accepted. IEA estimates demand will go up by 2.3% to 87.8 million barrels a day. But things may change as fuel efficiency becomes a big factor in reducing consumption and as millions of Asians join the world economy from rural areas the impact of more cars may not be as severe with cars that give 60 or so miles per gallon like the Tata Nano and the competitors it creates. And in the west the USA may not be so wasteful as it has been to make up for the increases in Asia of new motorists and industrial uses of energy. Meantime the gains from exploration at today's prices may provide additional output though not by what CERA's overestimate. ...

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Al Maktoum is prime minister of Dubai. He points out some important facts about the Arab world. About half of the 300 million people in the Arab world are under the age of 25. Unemploment is very high among these 150 million Arab youth. About 50% of the jobless are youth, according to the prime minister. About 65 million of the Arabs are illiterate, and 10 million children under the age of 25 are not enrolled in any school. He points out that with so little education, the Arab youth are especially vulnerable to propaganda that creates extremism and is hostile to the west and the USA. One of his key points is that the Arab world is the most militarized place in the world, and spending on conflicts in the Middle East in the last 60 years is about $3 trillion. And in the last 15 years he says the spending on education which is 20% of what the world's 30 wealthiest countries spend, has dropped to 10% of that amount. And very little is being done to educate girls and give them opportunities. As a result of these convictions, Al Maktoum, who is also the ruler of Dubai and from the royal family, has committed about $3 billion to various initiatives to provide schooling to children, especially girls, and education for young people. This makes him one of the more enlightened leaders in the region pushing for new directions. This also reveals the critical weakness among the Arab peoples and why they tend to be so radicalized. Improvements in education and more opportunities for jobless youth, and creating a peaceful region -with the US and the EU countries committing to policies that lead to much diminished military sales to Mideast countries and reducing hostilities in the region -would do more to reduce anti-American sentiment in the region and improve US security than any other policy actions. As Iran, Pakistan and Afghanistan, and the Muslims of India share the same characteristics as the Arab peoples, and the same cultures, the same is true of this region, actually more so. Education has been even worse neglected in the South Asian Muslim region than among the Arabs. It is the key to peace, does more than troops to ensure the peace. The need is for more schools to be built and run in the region, for essential services like healthcare and development, and financing of job creating industries. ...

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David Kostin, Goldman Sach's U.S. equity strategist and his prediction of the S&P 500 at 1250 at the end of 2012. The S&P was at 1421 on April 1, 2012, the highest it has been since May 20, 2008. In his research note Kostin says that over the longer term the stock market will offer opportunities after a more normal growth environment is reestablished. This is similiar to the view held by John Bogle, founder of Vanguard. For the short term- the 2012-2013 time frame Kostin sees tactical risks, and results below average. The reason he gives is low economic growth and the large degree of uncertainty. The situation in Europe shows slowing to no growth and more deficit problems, and the sanctions on Iran pose risks for oil prices.

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Wolfgang Ischinger, former German ambassador to the U.S. 2001-2006 and president of the Munich Security Conference, says that one thing that would make a difference in the current state of German and European relations with the U.S. after NSA spying on chancellor Merkel, is for president Obama to show contrition. The continuing dynamics are important, as is evident in the deterioration in relations in 2003 following the American intervention in Iraq when not enough was done, says Ischinger. His view is that the proposals to limit diplomatic personnel of the U.S. in European countries, or putting on hold the Trans-Atlantic trade talks, are not good ideas as they do not help restore trust. Building on a report by the European parliament in 2001 on protections against intelligence operations would be a good start.

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The focus is shifting from the oil majors to the companies in the oil field services sector, companies that supply the oil companies with oil field services. Deepwater oil field drilling rigs some of the most modern computer controlled ones run $650 million are in great demand and one Norwegian supplier of drilling rigs has anticipated the demand for advanced deepwater drilling rigs which the major oil companies had not invested in and is now in a position to charge $600,000 a day for the advanced rigs he has ordered 3 years ago as the deepwater drilling took off in places like offshore Angola. Earlier this Norwegian had anticipated the shift to long haul shipping of oil to places like India and China from Iran and offshore Africa.

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This view in the Economist shows that president Trump actually represented the instincts of the Republican party base by 2018- anti-immigrant, anti-elitist, and to the right on social issues. As a result it says it is no surprise that he has taken over the Republican party. As the elections for Congress get closer most candidates are trying to get Trump's support and many of the older senators and Congressman from the earlier period of the party are retiring. It cites polls showing Trump has support of 85% of the Republican party base. In 2018 Mr. Trump appointed new members of his cabinet who more closely represented his views on China, Iran, NATO, and business issues. Remaining party leaders such as Mr. Romney running for Senate seat from Utah are now seeking and getting Trump's endorsement. The Republican National Committee is also run by Trump supporters. On issues of foreign affairs Trump has combined alternate shifts between demands and pragmatism in relations with China, Iran, and other countries on trade, politics, coming up with a new way international relations are tackled. Part of the reason for their appeal is the nature of the intractable problems such as the imbalances in trade, nuclear weapons, and the idea that an alternative approach might work when other approaches have failed.  On social issues such as issues facing workers in globalization and free trade the parties to the left in the U.S. and countries in western Europe have failed to deliver, leading to the appeal of Mr. Trump, Brexiters, National Front in France.  The immigration issue has also worked against the socialist parties.  In Britain dissatisfaction with Theresa May and hard core Brexiters is growing, leading to Labor Party getting 40% of the vote in the recent election. Suggesting that the changes induced by the Brexiters and the Trump administration may lead to other changes in the future that may shift the focus back to basic issues and delivery on infrastructure, health and education which are fundamental for the future.   ...