FROM: INTERNAL REVENUE SERVICE
IRS Releases the “Dirty Dozen” Tax Scams for 2014; Identity Theft, Phone Scams Lead List
WASHINGTON — The Internal Revenue Service today issued its annual “Dirty Dozen” list of tax scams, reminding taxpayers to use caution during tax season to protect themselves against a wide range of schemes ranging from identity theft to return preparer fraud.
The Dirty Dozen listing, compiled by the IRS each year, lists a variety of common scams taxpayers can encounter at any point during the year. But many of these schemes peak during filing season as people prepare their tax returns.
"Taxpayers should be on the lookout for tax scams using the IRS name,” said IRS Commissioner John Koskinen. “These schemes jump every year at tax time. Scams can be sophisticated and take many different forms. We urge people to protect themselves and use caution when viewing e-mails, receiving telephone calls or getting advice on tax issues.”
Illegal scams can lead to significant penalties and interest and possible criminal prosecution. IRS Criminal Investigation works closely with the Department of Justice (DOJ) to shutdown scams and prosecute the criminals behind them.
The following are the Dirty Dozen tax scams for 2014:
Identity Theft
Tax fraud through the use of identity theft tops this year’s Dirty Dozen list. Identity theft occurs when someone uses your personal information, such as your name, Social Security number (SSN) or other identifying information, without your permission, to commit fraud or other crimes. In many cases, an identity thief uses a legitimate taxpayer’s identity to fraudulently file a tax return and claim a refund.
The agency’s work on identity theft and refund fraud continues to grow, touching nearly every part of the organization. For the 2014 filing season, the IRS has expanded these efforts to better protect taxpayers and help victims.
The IRS has a special section on IRS.gov dedicated to identity theft issues, including YouTube videos, tips for taxpayers and an assistance guide. For victims, the information includes how to contact the IRS Identity Protection Specialized Unit. For other taxpayers, there are tips on how taxpayers can protect themselves against identity theft.
Taxpayers who believe they are at risk of identity theft due to lost or stolen personal information should contact the IRS immediately so the agency can take action to secure their tax account. Taxpayers can call the IRS Identity Protection Specialized Unit at 800-908-4490. More information can be found on the special identity protection page.
Pervasive Telephone Scams
The IRS has seen a recent increase in local phone scams across the country, with callers pretending to be from the IRS in hopes of stealing money or identities from victims.
These phone scams include many variations, ranging from instances from where callers say the victims owe money or are entitled to a huge refund. Some calls can threaten arrest and threaten a driver’s license revocation. Sometimes these calls are paired with follow-up calls from people saying they are from the local police department or the state motor vehicle department.
Characteristics of these scams can include:
Scammers use fake names and IRS badge numbers. They generally use common names and surnames to identify themselves.
Scammers may be able to recite the last four digits of a victim’s Social Security Number.
Scammers “spoof” or imitate the IRS toll-free number on caller ID to make it appear that it’s the IRS calling.
Scammers sometimes send bogus IRS emails to some victims to support their bogus calls.
Victims hear background noise of other calls being conducted to mimic a call site.
After threatening victims with jail time or a driver’s license revocation, scammers hang up and others soon call back pretending to be from the local police or DMV, and the caller ID supports their claim.
In another variation, one sophisticated phone scam has targeted taxpayers, including recent immigrants, throughout the country. Victims are told they owe money to the IRS and it must be paid promptly through a pre-loaded debit card or wire transfer. If the victim refuses to cooperate, they are then threatened with arrest, deportation or suspension of a business or driver’s license. In many cases, the caller becomes hostile and insulting.
If you get a phone call from someone claiming to be from the IRS, here’s what you should do: If you know you owe taxes or you think you might owe taxes, call the IRS at 1.800.829.1040. The IRS employees at that line can help you with a payment issue – if there really is such an issue.
If you know you don’t owe taxes or have no reason to think that you owe any taxes (for example, you’ve never received a bill or the caller made some bogus threats as described above), then call and report the incident to the Treasury Inspector General for Tax Administration at 1.800.366.4484.
If you’ve been targeted by these scams, you should also contact the Federal Trade Commission and use their “FTC Complaint Assistant” at FTC.gov. Please add "IRS Telephone Scam" to the comments of your complaint.
Phishing
Phishing is a scam typically carried out with the help of unsolicited email or a fake website that poses as a legitimate site to lure in potential victims and prompt them to provide valuable personal and financial information. Armed with this information, a criminal can commit identity theft or financial theft.
If you receive an unsolicited email that appears to be from either the IRS or an organization closely linked to the IRS, such as the Electronic Federal Tax Payment System (EFTPS), report it by sending it to phishing@irs.gov.
It is important to keep in mind the IRS does not initiate contact with taxpayers by email to request personal or financial information. This includes any type of electronic communication, such as text messages and social media channels. The IRS has information online that can help you protect yourself from email scams.
False Promises of “Free Money” from Inflated Refunds
Scam artists routinely pose as tax preparers during tax time, luring victims in by promising large federal tax refunds or refunds that people never dreamed they were due in the first place.
Scam artists use flyers, advertisements, phony store fronts and even word of mouth to throw out a wide net for victims. They may even spread the word through community groups or churches where trust is high. Scammers prey on people who do not have a filing requirement, such as low-income individuals or the elderly. They also prey on non-English speakers, who may or may not have a filing requirement.
Scammers build false hope by duping people into making claims for fictitious rebates, benefits or tax credits. They charge good money for very bad advice. Or worse, they file a false return in a person's name and that person never knows that a refund was paid.
Scam artists also victimize people with a filing requirement and due a refund by promising inflated refunds based on fictitious Social Security benefits and false claims for education credits, the Earned Income Tax Credit (EITC), or the American Opportunity Tax Credit, among others.
The IRS sometimes hears about scams from victims complaining about losing their federal benefits, such as Social Security benefits, certain veteran’s benefits or low-income housing benefits. The loss of benefits was the result of false claims being filed with the IRS that provided false income amounts.
While honest tax preparers provide their customers a copy of the tax return they’ve prepared, victims of scam frequently are not given a copy of what was filed. Victims also report that the fraudulent refund is deposited into the scammer’s bank account. The scammers deduct a large “fee” before cutting a check to the victim, a practice not used by legitimate tax preparers.
The IRS reminds all taxpayers that they are legally responsible for what’s on their returns even if it was prepared by someone else. Taxpayers who buy into such schemes can end up being penalized for filing false claims or receiving fraudulent refunds.
Taxpayers should take care when choosing an individual or firm to prepare their taxes. Honest return preparers generally: ask for proof of income and eligibility for credits and deductions; sign returns as the preparer; enter their IRS Preparer Tax Identification Number (PTIN); provide the taxpayer a copy of the return.
Beware: Intentional mistakes of this kind can result in a $5,000 penalty.
Return Preparer Fraud
About 60 percent of taxpayers will use tax professionals this year to prepare their tax returns. Most return preparers provide honest service to their clients. But, some unscrupulous preparers prey on unsuspecting taxpayers, and the result can be refund fraud or identity theft.
It is important to choose carefully when hiring an individual or firm to prepare your return. This year, the IRS wants to remind all taxpayers that they should use only preparers who sign the returns they prepare and enter their IRS Preparer Tax Identification Numbers (PTINs).
The IRS also has a web page to assist taxpayers. For tips about choosing a preparer, details on preparer qualifications and information on how and when to make a complaint, visit www.irs.gov/chooseataxpro.
Remember: Taxpayers are legally responsible for what’s on their tax return even if it is prepared by someone else. Make sure the preparer you hire is up to the task.
IRS.gov has general information on reporting tax fraud. More specifically, you report abusive tax preparers to the IRS on Form 14157, Complaint: Tax Return Preparer. Download Form 14157 and fill it out or order by mail at 800-TAX FORM (800-829-3676). The form includes a return address.
Hiding Income Offshore
Over the years, numerous individuals have been identified as evading U.S. taxes by hiding income in offshore banks, brokerage accounts or nominee entities and then using debit cards, credit cards or wire transfers to access the funds. Others have employed foreign trusts, employee-leasing schemes, private annuities or insurance plans for the same purpose.
The IRS uses information gained from its investigations to pursue taxpayers with undeclared accounts, as well as the banks and bankers suspected of helping clients hide their assets overseas. The IRS works closely with the Department of Justice (DOJ) to prosecute tax evasion cases.
While there are legitimate reasons for maintaining financial accounts abroad, there are reporting requirements that need to be fulfilled. U.S. taxpayers who maintain such accounts and who do not comply with reporting requirements are breaking the law and risk significant penalties and fines, as well as the possibility of criminal prosecution.
Since 2009, tens of thousands of individuals have come forward voluntarily to disclose their foreign financial accounts, taking advantage of special opportunities to comply with the U.S. tax system and resolve their tax obligations. And, with new foreign account reporting requirements being phased in over the next few years, hiding income offshore is increasingly more difficult.
At the beginning of 2012, the IRS reopened the Offshore Voluntary Disclosure Program (OVDP) following continued strong interest from taxpayers and tax practitioners after the closure of the 2011 and 2009 programs. The IRS works on a wide range of international tax issues with DOJ to pursue criminal prosecution of international tax evasion. This program will be open for an indefinite period until otherwise announced.
The IRS has collected billions of dollars in back taxes, interest and penalties so far from people who participated in offshore voluntary disclosure programs since 2009. It is in the best long-term interest of taxpayers to come forward, catch up on their filing requirements and pay their fair share.
Impersonation of Charitable Organizations
Another long-standing type of abuse or fraud is scams that occur in the wake of significant natural disasters.
Following major disasters, it’s common for scam artists to impersonate charities to get money or private information from well-intentioned taxpayers. Scam artists can use a variety of tactics. Some scammers operating bogus charities may contact people by telephone or email to solicit money or financial information. They may even directly contact disaster victims and claim to be working for or on behalf of the IRS to help the victims file casualty loss claims and get tax refunds.
They may attempt to get personal financial information or Social Security numbers that can be used to steal the victims’ identities or financial resources. Bogus websites may solicit funds for disaster victims. The IRS cautions both victims of natural disasters and people wishing to make charitable donations to avoid scam artists by following these tips:
To help disaster victims, donate to recognized charities.
Be wary of charities with names that are similar to familiar or nationally known organizations. Some phony charities use names or websites that sound or look like those of respected, legitimate organizations. IRS.gov has a search feature, Exempt Organizations Select Check, which allows people to find legitimate, qualified charities to which donations may be tax-deductible.
Don’t give out personal financial information, such as Social Security numbers or credit card and bank account numbers and passwords, to anyone who solicits a contribution from you. Scam artists may use this information to steal your identity and money.
Don’t give or send cash. For security and tax record purposes, contribute by check or credit card or another way that provides documentation of the gift.
Call the IRS toll-free disaster assistance telephone number (1-866-562-5227) if you are a disaster victim with specific questions about tax relief or disaster related tax issues.
False Income, Expenses or Exemptions
Another scam involves inflating or including income on a tax return that was never earned, either as wages or as self-employment income in order to maximize refundable credits. Claiming income you did not earn or expenses you did not pay in order to secure larger refundable credits such as the Earned Income Tax Credit could have serious repercussions. This could result in repaying the erroneous refunds, including interest and penalties, and in some cases, even prosecution.
Additionally, some taxpayers are filing excessive claims for the fuel tax credit. Farmers and other taxpayers who use fuel for off-highway business purposes may be eligible for the fuel tax credit. But other individuals have claimed the tax credit although they were not eligible. Fraud involving the fuel tax credit is considered a frivolous tax claim and can result in a penalty of $5,000.
Frivolous Arguments
Promoters of frivolous schemes encourage taxpayers to make unreasonable and outlandish claims to avoid paying the taxes they owe. The IRS has a list of frivolous tax arguments that taxpayers should avoid. These arguments are wrong and have been thrown out of court. While taxpayers have the right to contest their tax liabilities in court, no one has the right to disobey the law or disregard their responsibility to pay taxes.
Those who promote or adopt frivolous positions risk a variety of penalties. For example, taxpayers could be responsible for an accuracy-related penalty, a civil fraud penalty, an erroneous refund claim penalty, or a failure to file penalty. The Tax Court may also impose a penalty against taxpayers who make frivolous arguments in court.
Taxpayers who rely on frivolous arguments and schemes may also face criminal prosecution for attempting to evade or defeat tax. Similarly, taxpayers may be convicted of a felony for willfully making and signing under penalties of perjury any return, statement, or other document that the person does not believe to be true and correct as to every material matter. Persons who promote frivolous arguments and those who assist taxpayers in claiming tax benefits based on frivolous arguments may be prosecuted for a criminal felony.
Falsely Claiming Zero Wages or Using False Form 1099
Filing a phony information return is an illegal way to lower the amount of taxes an individual owes. Typically, a Form 4852 (Substitute Form W-2) or a “corrected” Form 1099 is used as a way to improperly reduce taxable income to zero. The taxpayer may also submit a statement rebutting wages and taxes reported by a payer to the IRS.
Sometimes, fraudsters even include an explanation on their Form 4852 that cites statutory language on the definition of wages or may include some reference to a paying company that refuses to issue a corrected Form W-2 for fear of IRS retaliation. Taxpayers should resist any temptation to participate in any variations of this scheme. Filing this type of return may result in a $5,000 penalty.
Some people also attempt fraud using false Form 1099 refund claims. In some cases, individuals have made refund claims based on the bogus theory that the federal government maintains secret accounts for U.S. citizens and that taxpayers can gain access to the accounts by issuing 1099-OID forms to the IRS. In this ongoing scam, the perpetrator files a fake information return, such as a Form 1099 Original Issue Discount (OID), to justify a false refund claim on a corresponding tax return.
Don’t fall prey to people who encourage you to claim deductions or credits to which you are not entitled or willingly allow others to use your information to file false returns. If you are a party to such schemes, you could be liable for financial penalties or even face criminal prosecution.
Abusive Tax Structures
Abusive tax schemes have evolved from simple structuring of abusive domestic and foreign trust arrangements into sophisticated strategies that take advantage of the financial secrecy laws of some foreign jurisdictions and the availability of credit/debit cards issued from offshore financial institutions.
IRS Criminal Investigation (CI) has developed a nationally coordinated program to combat these abusive tax schemes. CI's primary focus is on the identification and investigation of the tax scheme promoters as well as those who play a substantial or integral role in facilitating, aiding, assisting, or furthering the abusive tax scheme (e.g., accountants, lawyers). Secondarily, but equally important, is the investigation of investors who knowingly participate in abusive tax schemes.
What is an abusive scheme? The Abusive Tax Schemes program encompasses violations of the Internal Revenue Code (IRC) and related statutes where multiple flow-through entities are used as an integral part of the taxpayer's scheme to evade taxes. These schemes are characterized by the use of Limited Liability Companies (LLCs), Limited Liability Partnerships (LLPs), International Business Companies (IBCs), foreign financial accounts, offshore credit/debit cards and other similar instruments. The schemes are usually complex involving multi-layer transactions for the purpose of concealing the true nature and ownership of the taxable income and/or assets.
Form over substance are the most important words to remember before buying into any arrangements that promise to "eliminate" or "substantially reduce" your tax liability. The promoters of abusive tax schemes often employ financial instruments in their schemes. However, the instruments are used for improper purposes including the facilitation of tax evasion.
The IRS encourages taxpayers to report unlawful tax evasion. Where Do You Report Suspected Tax Fraud Activity?
Misuse of Trusts
Trusts also commonly show up in abusive tax structures. They are highlighted here because unscrupulous promoters continue to urge taxpayers to transfer large amounts of assets into trusts. These assets include not only cash and investments, but also successful on-going businesses. There are legitimate uses of trusts in tax and estate planning, but the IRS commonly sees highly questionable transactions. These transactions promise reduced taxable income, inflated deductions for personal expenses, the reduction or elimination of self-employment taxes and reduced estate or gift transfer taxes. These transactions commonly arise when taxpayers are transferring wealth from one generation to another. Questionable trusts rarely deliver the tax benefits promised and are used primarily as a means of avoiding income tax liability and hiding assets from creditors, including the IRS.
IRS personnel continue to see an increase in the improper use of private annuity trusts and foreign trusts to shift income and deduct personal expenses, as well as to avoid estate transfer taxes. As with other arrangements, taxpayers should seek the advice of a trusted professional before entering a trust arrangement.
The IRS reminds taxpayers that tax scams can take many forms beyond the “Dirty Dozen,” and people should be on the lookout for many other schemes. More information on tax scams is available at IRS.gov.
Thursday, February 20, 2014
COMPANY AND OWNER TO PAY $6.2 MILLION FOR PRECIOUS METALS FRAUD SCHEME
FROM: COMMODITY FUTURES TRADING COMMISSION
CFTC Orders Florida-based Worth Asset Management and its Owner, Paul L. Kaulesar, to pay over $6.2 Million in Restitution and a Fine for Multi-Million Dollar Fraudulent Precious Metals Scheme
Washington DC – The U.S. Commodity Futures Trading Commission (CFTC) today filed and settled charges against Worth Asset Management LLC (Worth Asset) of West Palm Beach, Florida, and its sole owner and manager, Paul L. Kaulesar of Royal Palm Beach, for solicitation fraud and engaging in illegal, off-exchange precious metals transactions. Neither Worth Asset nor Kaulesar has ever been registered with the CFTC.
The CFTC Order requires Worth Asset and Kaulesar jointly to pay a $1,565,000 civil monetary penalty and restitution to their customers totaling $4,696,640. The Order also imposes permanent trading and registration bans against Worth Asset and Kaulesar and prohibits them from violating the provisions of the Commodity Exchange Act and a CFTC Regulation, as charged.
The Order finds that, between July 16, 2011 and March 31, 2013, Worth Asset and Kaulesar operated a telemarketing firm that solicited individual retail customers to enter into financed precious metals transactions in gold, silver, and platinum. The large majority of their transactions involved the sale of leveraged silver contracts to unsophisticated investors purchasing physical metals by paying as little as 20 percent of the total price and receiving a loan for the balance of the transaction, according to the Order. Customers were also charged a 15 percent commission on the total leveraged value of the metal transaction, as well as monthly interest, according to the Order.
However, according to the Order, Worth Asset and Kaulesar did not purchase physical commodities on the customers’ behalf. Rather, they aggregated the customer payments received, transferred a portion of those funds to their margin trading account, and made book entries in an electronic database reflecting the customer transaction details. During the period, Worth Asset and Kaulesar received $4,696,640, the difference between the funds that customers sent to them and what they returned to customers, the Order also finds.
Illegal Contracts
The precious metals transactions offered by Worth Asset and Kaulesar were illegal contracts because they were not executed on or subject to the rules of a board of trade, exchange, or contract market, as required by the Commodity Exchange Act, according to the Order.
Solicitation Fraud
Worth Asset and Kaulesar defrauded customers and potential customers by misrepresenting the potential profits from leveraged precious metals contracts and failing to disclose the past performance of the precious metals contracts they offered, the Order finds. One piece of their promotional material, for example, emphasized the profits that could purportedly be obtained through precious metals transactions, claiming that “[r]enowned precious metals analyst, [name omitted], predicts Silver to top $60 an ounce by the end of 2012.” However, Worth Asset and Kaulesar failed to inform customers that at least 88 percent of the firm’s customers lost money on their financed precious metals investments.
CFTC Division of Enforcement staff members responsible for this case are Kyong J. Koh, Todd Kelly, Peter M. Haas, and Paul G. Hayeck.
* * * * *
CFTC’s Precious Metals Customer Fraud Advisory
The CFTC has issued several customer protection Fraud Advisories that provide the warning signs of fraud, including the Precious Metals Fraud Advisory, which alerts customers to precious metals fraud and lists simple ways to spot precious metals scams.
CFTC Orders Florida-based Worth Asset Management and its Owner, Paul L. Kaulesar, to pay over $6.2 Million in Restitution and a Fine for Multi-Million Dollar Fraudulent Precious Metals Scheme
Washington DC – The U.S. Commodity Futures Trading Commission (CFTC) today filed and settled charges against Worth Asset Management LLC (Worth Asset) of West Palm Beach, Florida, and its sole owner and manager, Paul L. Kaulesar of Royal Palm Beach, for solicitation fraud and engaging in illegal, off-exchange precious metals transactions. Neither Worth Asset nor Kaulesar has ever been registered with the CFTC.
The CFTC Order requires Worth Asset and Kaulesar jointly to pay a $1,565,000 civil monetary penalty and restitution to their customers totaling $4,696,640. The Order also imposes permanent trading and registration bans against Worth Asset and Kaulesar and prohibits them from violating the provisions of the Commodity Exchange Act and a CFTC Regulation, as charged.
The Order finds that, between July 16, 2011 and March 31, 2013, Worth Asset and Kaulesar operated a telemarketing firm that solicited individual retail customers to enter into financed precious metals transactions in gold, silver, and platinum. The large majority of their transactions involved the sale of leveraged silver contracts to unsophisticated investors purchasing physical metals by paying as little as 20 percent of the total price and receiving a loan for the balance of the transaction, according to the Order. Customers were also charged a 15 percent commission on the total leveraged value of the metal transaction, as well as monthly interest, according to the Order.
However, according to the Order, Worth Asset and Kaulesar did not purchase physical commodities on the customers’ behalf. Rather, they aggregated the customer payments received, transferred a portion of those funds to their margin trading account, and made book entries in an electronic database reflecting the customer transaction details. During the period, Worth Asset and Kaulesar received $4,696,640, the difference between the funds that customers sent to them and what they returned to customers, the Order also finds.
Illegal Contracts
The precious metals transactions offered by Worth Asset and Kaulesar were illegal contracts because they were not executed on or subject to the rules of a board of trade, exchange, or contract market, as required by the Commodity Exchange Act, according to the Order.
Solicitation Fraud
Worth Asset and Kaulesar defrauded customers and potential customers by misrepresenting the potential profits from leveraged precious metals contracts and failing to disclose the past performance of the precious metals contracts they offered, the Order finds. One piece of their promotional material, for example, emphasized the profits that could purportedly be obtained through precious metals transactions, claiming that “[r]enowned precious metals analyst, [name omitted], predicts Silver to top $60 an ounce by the end of 2012.” However, Worth Asset and Kaulesar failed to inform customers that at least 88 percent of the firm’s customers lost money on their financed precious metals investments.
CFTC Division of Enforcement staff members responsible for this case are Kyong J. Koh, Todd Kelly, Peter M. Haas, and Paul G. Hayeck.
* * * * *
CFTC’s Precious Metals Customer Fraud Advisory
The CFTC has issued several customer protection Fraud Advisories that provide the warning signs of fraud, including the Precious Metals Fraud Advisory, which alerts customers to precious metals fraud and lists simple ways to spot precious metals scams.
ADDITIONAL $100 MILLION WILL BE PROVIDED TO AID IN CALIFORNIA DROUGHT RELIEF
FROM: U.S. AGRICULTURE DEPARTMENT
Obama Administration Announces Additional Assistance to Californians Impacted by Drought
USDA will provide up to $100 million in livestock disaster assistance, additional $10 million for water conservation.
FRESNO, Calif., Feb. 14, 2014 – Agriculture Secretary Tom Vilsack joined President Barack Obama in Fresno, Calif., today to announce that the U.S. Department of Agriculture (USDA) will provide additional assistance to help farmers, ranchers and residents affected by severe drought in California. At President Obama's direction, USDA has made implementation of the 2014 Farm Bill livestock disaster assistance programs a top priority and plans to have the programs available for sign up by April 15, 2014.
"President Obama and I will continue to do everything within our power to support California farmers, ranchers and families living in drought-stricken areas. This assistance, coupled with other aid being made available across government, should provide some relief during this difficult time," said Vilsack. "Thanks to the newly-signed Farm Bill, we are now able to offer long-awaited livestock disaster assistance, which will provide needed stability for California livestock producers impacted by drought."
USDA has declared 54 counties in California as primary natural disaster areas due to drought. Additional USDA resources announced for California and other drought-stricken states today include:
$100 million in livestock disaster assistance for California producers. The 2014 Farm Bill contains permanent livestock disaster programs including the Livestock Forage Disaster Program, which will help producers in California and other areas recover from the drought. At President Obama's direction, USDA is making implementation of the disaster programs a top priority and plans to have the programs available for sign up in 60 days. Producers will be able to sign up for the livestock disaster programs for losses not only for 2014 but for losses they experienced in 2012 and 2013. While these livestock programs took over a year to get assistance out the door under the last Farm Bill– USDA has committed to cut that time by more than 80 percent and begin sign-up in April. California alone could potentially receive up to $100 million for 2014 losses and up to $50 million for previous years. $15 million in targeted conservation assistance for the most extreme and exceptional drought areas. This includes $5 million in additional assistance to California and $10 million for drought-impacted areas in Texas, Oklahoma, Nebraska, Colorado and New Mexico. The funding is available through the Environmental Quality Incentives Program (EQIP) administered by USDA. The assistance helps farmers and ranchers implement conservation practices that conserve scarce water resources, reduce wind erosion on drought-impacted fields and improve livestock access to water. $5 million in targeted Emergency Watershed Protection (EWP) Program assistance to the most drought impacted areas of California to protect vulnerable soils. EWP helps communities address watershed impairments due to drought and other natural occurrences. This funding will help drought-ravaged communities and private landowners address watershed impairments, such as stabilizing stream banks and replanting upland sites stripped of vegetation. $60 million has been made available to food banks in the State of California to help families that may be economically impacted by the drought. The U.S. Department of Agriculture (USDA) is providing help to food banks through The Emergency Food Assistance Program (TEFAP). 600 summer meal sites to be established in California's drought stricken areas. The U.S. Department of Agriculture (USDA) is working with the California Department of Education to target efforts to expand the number of Summer Food Service Program meal sites this summer. There are expected to be close to 600 summer meal sites throughout the drought stricken areas. $3 million in Emergency Water Assistance Grants for rural communities experiencing water shortages. U.S. Department of Agriculture (USDA) is making $3 million in grants available to help rural communities that are experiencing a significant decline in the quality or quantity of drinking water due to the drought obtain or maintain water sources of sufficient quantity and quality. These funds will be provided to eligible, qualified communities by application through USDA-Rural Development's Emergency Community Water Assistance Grants (ECWAG). California state health officials have already identified 17 small community water districts in 10 counties that are at risk of running out of water in 60-120 days. This number is expected to increase if current conditions persist.
Today's announcements build on other recent USDA efforts to help farmers, ranchers, and forest landowners mitigate the impacts of drought. Last week, USDA announced $20 million in Environmental Quality Incentives Program (EQIP) funds for agricultural conservation enhancements on key agricultural lands in California. These enhancements include irrigation efficiency, cover crops, orchard pruning, and protection of grazing lands. USDA also announced $15 million in Conservation Innovation Grants (CIG) in available funding to state and local governments, Tribes, universities, businesses and agricultural producers. These grants are dedicated to stimulating the development and adoption of innovative conservation approaches and technologies, including those that will help communities adapt to drought and climate change.
USDA also announced last week the establishment of regional Climate Hubs across the country that will help farmers, ranchers and communities get the information and data they need to make informed decisions around a changing climate. One center was established at the University of California, Davis.
As USDA begins implementing disaster assistance programs, producers should record all pertinent information of natural disaster consequences, including:
Documentation of the number and kind of livestock that have died, supplemented if possible by photographs or video records of ownership and losses; Dates of death supported by birth recordings or purchase receipts; Costs of transporting livestock to safer grounds or to move animals to new pastures; Feed purchases if supplies or grazing pastures are destroyed; Crop records, including seed and fertilizer purchases, planting and production records; Pictures of on-farm storage facilities that were destroyed by wind or flood waters; and Evidence of damaged farm land.
For more information about today's announcements, visit the USDA drought resource page at www.usda.gov/drought.
Obama Administration Announces Additional Assistance to Californians Impacted by Drought
USDA will provide up to $100 million in livestock disaster assistance, additional $10 million for water conservation.
FRESNO, Calif., Feb. 14, 2014 – Agriculture Secretary Tom Vilsack joined President Barack Obama in Fresno, Calif., today to announce that the U.S. Department of Agriculture (USDA) will provide additional assistance to help farmers, ranchers and residents affected by severe drought in California. At President Obama's direction, USDA has made implementation of the 2014 Farm Bill livestock disaster assistance programs a top priority and plans to have the programs available for sign up by April 15, 2014.
"President Obama and I will continue to do everything within our power to support California farmers, ranchers and families living in drought-stricken areas. This assistance, coupled with other aid being made available across government, should provide some relief during this difficult time," said Vilsack. "Thanks to the newly-signed Farm Bill, we are now able to offer long-awaited livestock disaster assistance, which will provide needed stability for California livestock producers impacted by drought."
USDA has declared 54 counties in California as primary natural disaster areas due to drought. Additional USDA resources announced for California and other drought-stricken states today include:
$100 million in livestock disaster assistance for California producers. The 2014 Farm Bill contains permanent livestock disaster programs including the Livestock Forage Disaster Program, which will help producers in California and other areas recover from the drought. At President Obama's direction, USDA is making implementation of the disaster programs a top priority and plans to have the programs available for sign up in 60 days. Producers will be able to sign up for the livestock disaster programs for losses not only for 2014 but for losses they experienced in 2012 and 2013. While these livestock programs took over a year to get assistance out the door under the last Farm Bill– USDA has committed to cut that time by more than 80 percent and begin sign-up in April. California alone could potentially receive up to $100 million for 2014 losses and up to $50 million for previous years. $15 million in targeted conservation assistance for the most extreme and exceptional drought areas. This includes $5 million in additional assistance to California and $10 million for drought-impacted areas in Texas, Oklahoma, Nebraska, Colorado and New Mexico. The funding is available through the Environmental Quality Incentives Program (EQIP) administered by USDA. The assistance helps farmers and ranchers implement conservation practices that conserve scarce water resources, reduce wind erosion on drought-impacted fields and improve livestock access to water. $5 million in targeted Emergency Watershed Protection (EWP) Program assistance to the most drought impacted areas of California to protect vulnerable soils. EWP helps communities address watershed impairments due to drought and other natural occurrences. This funding will help drought-ravaged communities and private landowners address watershed impairments, such as stabilizing stream banks and replanting upland sites stripped of vegetation. $60 million has been made available to food banks in the State of California to help families that may be economically impacted by the drought. The U.S. Department of Agriculture (USDA) is providing help to food banks through The Emergency Food Assistance Program (TEFAP). 600 summer meal sites to be established in California's drought stricken areas. The U.S. Department of Agriculture (USDA) is working with the California Department of Education to target efforts to expand the number of Summer Food Service Program meal sites this summer. There are expected to be close to 600 summer meal sites throughout the drought stricken areas. $3 million in Emergency Water Assistance Grants for rural communities experiencing water shortages. U.S. Department of Agriculture (USDA) is making $3 million in grants available to help rural communities that are experiencing a significant decline in the quality or quantity of drinking water due to the drought obtain or maintain water sources of sufficient quantity and quality. These funds will be provided to eligible, qualified communities by application through USDA-Rural Development's Emergency Community Water Assistance Grants (ECWAG). California state health officials have already identified 17 small community water districts in 10 counties that are at risk of running out of water in 60-120 days. This number is expected to increase if current conditions persist.
Today's announcements build on other recent USDA efforts to help farmers, ranchers, and forest landowners mitigate the impacts of drought. Last week, USDA announced $20 million in Environmental Quality Incentives Program (EQIP) funds for agricultural conservation enhancements on key agricultural lands in California. These enhancements include irrigation efficiency, cover crops, orchard pruning, and protection of grazing lands. USDA also announced $15 million in Conservation Innovation Grants (CIG) in available funding to state and local governments, Tribes, universities, businesses and agricultural producers. These grants are dedicated to stimulating the development and adoption of innovative conservation approaches and technologies, including those that will help communities adapt to drought and climate change.
USDA also announced last week the establishment of regional Climate Hubs across the country that will help farmers, ranchers and communities get the information and data they need to make informed decisions around a changing climate. One center was established at the University of California, Davis.
As USDA begins implementing disaster assistance programs, producers should record all pertinent information of natural disaster consequences, including:
Documentation of the number and kind of livestock that have died, supplemented if possible by photographs or video records of ownership and losses; Dates of death supported by birth recordings or purchase receipts; Costs of transporting livestock to safer grounds or to move animals to new pastures; Feed purchases if supplies or grazing pastures are destroyed; Crop records, including seed and fertilizer purchases, planting and production records; Pictures of on-farm storage facilities that were destroyed by wind or flood waters; and Evidence of damaged farm land.
For more information about today's announcements, visit the USDA drought resource page at www.usda.gov/drought.
BUSINESS OPPORTUNITY SCAM SHUTDOWN BY FTC
FROM: FEDERAL TRADE COMMISSION
FTC Shuts Down Business Opportunity Scam
Several companies and individuals have agreed to settlements with the Federal Trade Commission that ban them from selling business or work-at-home opportunities and require them to surrender assets to the FTC.
As part of the FTC’s ongoing crackdown on scams that falsely promise business opportunities targeted to unemployed or underemployed people, in October 2012, the FTC filed a complaint against Shopper Systems LLC, Revenue Works LLC (also doing business as Surplus Supplier), EMZ Ventures LLC, The Veracity Group LP, Brett Brosseau, Michael Moysich and Keith R. Powell.
The settlement orders resolve charges that the defendants misled consumers who were seeking to run their own business providing mystery shopping services to retailers, and tricked them into paying money to join programs with recurring monthly charges.
Along with the settlement orders announced today, a federal court approved the filing of an amended complaint adding Concept Rocket LLC and Shopper Select LLC as defendants, and Georgia Farm House Land Holdings LLC, PKP Holdings, Stephanie Powell, and Sportsmen of North America LP as relief defendants who profited from the scheme but did not participate in it.
The settlement order against Moysich, Concept Rocket, Revenue Works, Shopper Select and Shopper Systems, bans them from selling business or work-at-home opportunities, sending unauthorized text messages, and selling products or services with negative-option features. The settlement order against Brosseau and EMZ Ventures bans them from selling business or work-at-home opportunities and sending unauthorized text messages. The settlement orders impose a judgment of more than $40.5 million against these defendants, which will be suspended when the Moysich defendants have surrendered $55,000 in frozen assets, and the Brosseau defendants have surrendered $88,000 in frozen assets and nearly $270,000 from the sale of property in Georgia, Vermont.
The settlement order against Keith R. Powell and The Veracity Group bans them from selling business or work-at-home opportunities. It also imposes a judgment of more than $14.8 million, which will be suspended when Powell has surrendered his assets, including more than $115,000, to the FTC, and the Veracity Group has surrendered telecommunication equipment to a court-appointed receiver for liquidation. As stipulated in all three orders, the full monetary judgments will become due immediately if the defendants are found to have misrepresented their respective financial conditions.
The Commission vote to file the proposed consent judgments and an amended complaint in December 2013 was 2-0-2, with Commissioner Ohlhausen not participating and Commissioner Wright abstaining. The judgments were entered by the U. S. District Court for the Southern District of Florida on January 23, 2014.
To learn more about these kinds of scams, read the FTC’s Business Opportunity Scams (Estafas de Oportunidades de Negocio), Mystery Shopper Scams and Bogus Business Opportunities.
The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.
Contact Information
FTC Shuts Down Business Opportunity Scam
Several companies and individuals have agreed to settlements with the Federal Trade Commission that ban them from selling business or work-at-home opportunities and require them to surrender assets to the FTC.
As part of the FTC’s ongoing crackdown on scams that falsely promise business opportunities targeted to unemployed or underemployed people, in October 2012, the FTC filed a complaint against Shopper Systems LLC, Revenue Works LLC (also doing business as Surplus Supplier), EMZ Ventures LLC, The Veracity Group LP, Brett Brosseau, Michael Moysich and Keith R. Powell.
The settlement orders resolve charges that the defendants misled consumers who were seeking to run their own business providing mystery shopping services to retailers, and tricked them into paying money to join programs with recurring monthly charges.
Along with the settlement orders announced today, a federal court approved the filing of an amended complaint adding Concept Rocket LLC and Shopper Select LLC as defendants, and Georgia Farm House Land Holdings LLC, PKP Holdings, Stephanie Powell, and Sportsmen of North America LP as relief defendants who profited from the scheme but did not participate in it.
The settlement order against Moysich, Concept Rocket, Revenue Works, Shopper Select and Shopper Systems, bans them from selling business or work-at-home opportunities, sending unauthorized text messages, and selling products or services with negative-option features. The settlement order against Brosseau and EMZ Ventures bans them from selling business or work-at-home opportunities and sending unauthorized text messages. The settlement orders impose a judgment of more than $40.5 million against these defendants, which will be suspended when the Moysich defendants have surrendered $55,000 in frozen assets, and the Brosseau defendants have surrendered $88,000 in frozen assets and nearly $270,000 from the sale of property in Georgia, Vermont.
The settlement order against Keith R. Powell and The Veracity Group bans them from selling business or work-at-home opportunities. It also imposes a judgment of more than $14.8 million, which will be suspended when Powell has surrendered his assets, including more than $115,000, to the FTC, and the Veracity Group has surrendered telecommunication equipment to a court-appointed receiver for liquidation. As stipulated in all three orders, the full monetary judgments will become due immediately if the defendants are found to have misrepresented their respective financial conditions.
The Commission vote to file the proposed consent judgments and an amended complaint in December 2013 was 2-0-2, with Commissioner Ohlhausen not participating and Commissioner Wright abstaining. The judgments were entered by the U. S. District Court for the Southern District of Florida on January 23, 2014.
To learn more about these kinds of scams, read the FTC’s Business Opportunity Scams (Estafas de Oportunidades de Negocio), Mystery Shopper Scams and Bogus Business Opportunities.
The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.
Contact Information
BARRIO AZTECA LIEUTENANT FOUND GUILTY FOR SIX COUNTS OF MURDER
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, February 19, 2014
Barrio Azteca Lieutenant Who Ordered the Consulate Murders in Ciudad Juarez Found Guilty on All Counts
The Barrio Azteca Lieutenant who ordered the murders of a U.S. Consulate employee, her husband and the husband of another U.S. Consulate employee was found guilty by a jury on all counts charged announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Robert Pitman for the Western District of Texas, FBI Assistant Director of the Criminal Investigative Division Ronald T. Hosko and Administrator Michele M. Leonhart of the U.S. Drug Enforcement Administration (DEA).
Arturo Gallegos Castrellon, aka, “Benny,” aka “Farmero,” aka “51,” aka “Guero,” aka “Pecas,” aka “Tury,” aka “86,” 35, of Chihuahua, Mexico, was formally extradited to the United States from Mexico on June 28, 2012. Today, at the conclusion of a trial before U.S. District Judge Kathleen Cardone in the Western District of Texas, El Paso Division a jury found Gallegos Castrellon guilty to five counts of racketeering, narcotics trafficking, narcotics importation, murder in a foreign country and money laundering conspiracies and six counts of murder.
At trial, prosecutors presented evidence that the defendant was a leader in the Barrio Azteca, or “BA,” a violent street and prison gang that began in the late 1980’s and expanded into a transnational criminal organization. According to information presented in court, the BA formed an alliance with “La Linea,” which is part of the Juarez Drug Cartel. The Juarez Drug Cartel is also known as the Vincente Carrillo Fuentes Drug Cartel, or “VCF.” The purpose of the BA-La Linea alliance was to battle the Chapo Guzman Cartel and its allies for control of the drug trafficking routes through Juarez, Chihuahua, Mexico. The drug routes through Juarez, which is known as the Juarez Plaza, are important to drug trafficking organizations because it is a principal illicit drug trafficking route into the United States.
In addition, prosecutors presented evidence that the defendant was in charge of Barrio Azteca teams of assassin which he helped create and supervised in 2008 through 2010. Testimony and other evidence at trial established that his teams killed up to 800 persons between January and August 2010, reaching a total of nearly 1600 in a multi-year period.
Trial evidence also showed that the defendant ordered the March 13, 2010, triple homicide in Juarez, Mexico, of U.S. Consulate employee Leslie Enriquez, her husband Arthur Redelfs, and Jorge Salcido Ceniceros, the husband of another U.S. Consulate employee. The jury also heard evidence that the defendant was the mastermind of the July 15, 2010, car bombing in Juarez, Mexico, which targeted Mexican Federal Police.
A total of 35 defendants were charged in the Third Superseding Indictment and are alleged to have committed various criminal acts, including the 2010 Juarez Consulate Murders in Juarez, Mexico, racketeering, narcotics distribution and importation, retaliation against persons providing information to U.S. law enforcement, extortion, money laundering, murder, and obstruction of justice. Of the 35 defendants charged, 26 have been convicted, one committed suicide before the conclusion of his trial, and six are awaiting extradition. U.S. law enforcement officials are actively seeking to apprehend the two remaining fugitives in this case, including Eduardo Ravelo, an FBI Top Ten Most Wanted Fugitive.
The case is being prosecuted by Trial Attorney Joseph A. Cooley of the Criminal Division’s Organized Crime and Gang Section, Trial Attorney Brian Skaret of the Criminal Division’s Human Rights and Special Prosecutions Section and AUSA John Gibson of the U.S. Attorney’s Office of the Western District of Texas - El Paso Division. Valuable assistance was provided by the Criminal Division’s Offices of International Affairs and Enforcement Operations.
The case was investigated by the FBI’s El Paso Field Office, Albuquerque Field Office (Las Cruces Resident Agency), DEA Juarez, and DEA El Paso. Special assistance was provided by the Bureau of Alcohol, Tobacco, Firearms and Explosives; Immigration and Customs Enforcement; the U.S. Marshals Service; U.S. Customs and Border Protection; Federal Bureau of Prisons; U.S. Diplomatic Security Service; the Texas Department of Public Safety; the Texas Department of Criminal Justice; El Paso Police Department; El Paso County Sheriff’s Office; El Paso Independent School District Police Department; Texas Alcohol and Beverage Commission; New Mexico State Police; Dona Ana County, N.M., Sheriff’s Office; Las Cruces, N.M., Police Department; Southern New Mexico Correctional Facility and Otero County Prison Facility New Mexico.
Wednesday, February 19, 2014
Barrio Azteca Lieutenant Who Ordered the Consulate Murders in Ciudad Juarez Found Guilty on All Counts
The Barrio Azteca Lieutenant who ordered the murders of a U.S. Consulate employee, her husband and the husband of another U.S. Consulate employee was found guilty by a jury on all counts charged announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Robert Pitman for the Western District of Texas, FBI Assistant Director of the Criminal Investigative Division Ronald T. Hosko and Administrator Michele M. Leonhart of the U.S. Drug Enforcement Administration (DEA).
Arturo Gallegos Castrellon, aka, “Benny,” aka “Farmero,” aka “51,” aka “Guero,” aka “Pecas,” aka “Tury,” aka “86,” 35, of Chihuahua, Mexico, was formally extradited to the United States from Mexico on June 28, 2012. Today, at the conclusion of a trial before U.S. District Judge Kathleen Cardone in the Western District of Texas, El Paso Division a jury found Gallegos Castrellon guilty to five counts of racketeering, narcotics trafficking, narcotics importation, murder in a foreign country and money laundering conspiracies and six counts of murder.
At trial, prosecutors presented evidence that the defendant was a leader in the Barrio Azteca, or “BA,” a violent street and prison gang that began in the late 1980’s and expanded into a transnational criminal organization. According to information presented in court, the BA formed an alliance with “La Linea,” which is part of the Juarez Drug Cartel. The Juarez Drug Cartel is also known as the Vincente Carrillo Fuentes Drug Cartel, or “VCF.” The purpose of the BA-La Linea alliance was to battle the Chapo Guzman Cartel and its allies for control of the drug trafficking routes through Juarez, Chihuahua, Mexico. The drug routes through Juarez, which is known as the Juarez Plaza, are important to drug trafficking organizations because it is a principal illicit drug trafficking route into the United States.
In addition, prosecutors presented evidence that the defendant was in charge of Barrio Azteca teams of assassin which he helped create and supervised in 2008 through 2010. Testimony and other evidence at trial established that his teams killed up to 800 persons between January and August 2010, reaching a total of nearly 1600 in a multi-year period.
Trial evidence also showed that the defendant ordered the March 13, 2010, triple homicide in Juarez, Mexico, of U.S. Consulate employee Leslie Enriquez, her husband Arthur Redelfs, and Jorge Salcido Ceniceros, the husband of another U.S. Consulate employee. The jury also heard evidence that the defendant was the mastermind of the July 15, 2010, car bombing in Juarez, Mexico, which targeted Mexican Federal Police.
A total of 35 defendants were charged in the Third Superseding Indictment and are alleged to have committed various criminal acts, including the 2010 Juarez Consulate Murders in Juarez, Mexico, racketeering, narcotics distribution and importation, retaliation against persons providing information to U.S. law enforcement, extortion, money laundering, murder, and obstruction of justice. Of the 35 defendants charged, 26 have been convicted, one committed suicide before the conclusion of his trial, and six are awaiting extradition. U.S. law enforcement officials are actively seeking to apprehend the two remaining fugitives in this case, including Eduardo Ravelo, an FBI Top Ten Most Wanted Fugitive.
The case is being prosecuted by Trial Attorney Joseph A. Cooley of the Criminal Division’s Organized Crime and Gang Section, Trial Attorney Brian Skaret of the Criminal Division’s Human Rights and Special Prosecutions Section and AUSA John Gibson of the U.S. Attorney’s Office of the Western District of Texas - El Paso Division. Valuable assistance was provided by the Criminal Division’s Offices of International Affairs and Enforcement Operations.
The case was investigated by the FBI’s El Paso Field Office, Albuquerque Field Office (Las Cruces Resident Agency), DEA Juarez, and DEA El Paso. Special assistance was provided by the Bureau of Alcohol, Tobacco, Firearms and Explosives; Immigration and Customs Enforcement; the U.S. Marshals Service; U.S. Customs and Border Protection; Federal Bureau of Prisons; U.S. Diplomatic Security Service; the Texas Department of Public Safety; the Texas Department of Criminal Justice; El Paso Police Department; El Paso County Sheriff’s Office; El Paso Independent School District Police Department; Texas Alcohol and Beverage Commission; New Mexico State Police; Dona Ana County, N.M., Sheriff’s Office; Las Cruces, N.M., Police Department; Southern New Mexico Correctional Facility and Otero County Prison Facility New Mexico.
SUPERCOMPUTER SIMULATIONS RECREATE X-RAYS FROM AREA OF A BLACK HOLE
FROM: NATIONAL SCIENCE FOUNDATION
Let there be light
Simulations on NSF-supported supercomputer re-create X-rays emerging from the neighborhood of black holes
February 18, 2014
Black holes may be dark, but the areas around them definitely are not. These dense, spinning behemoths twist up gas and matter just outside their event horizon, and generate heat and energy that gets radiated, in part, as light. And when black holes merge, they produce a bright intergalactic burst that may act as a beacon for their collision.
Astrophysicists became deeply interested in black holes in the 1960s, but the idea of their event horizon was first intimated in a paper by Karl Schwarzschild published after Einstein introduced general relativity in 1915.
Knowledge about black holes--these still-unseen objects--has grown tremendously in recent years. Part of this growth comes from researchers' ability to use detailed numerical models and powerful supercomputers to simulate the complex dynamics near a black hole. This is no trivial matter. Warped spacetime, gas pressure, ionizing radiation, magnetized plasma--the list of phenomena that must be included in an accurate simulation goes on and on.
"It's not something that you want to do with a paper and pencil," said Scott Noble, an astrophysicist at the Rochester Institute of Technology (RIT).
Working with Jeremy Schnittman of Goddard Space Flight Center and Julian Krolik of Johns Hopkins University, Noble and his colleagues created a new tool that predicts the light that an accreting black hole would produce. They did so by modeling how photons hit gas particles in the disk around the black hole (also known as an accretion disk), generating light--specifically light in the X-ray spectrum--and producing signals detected with today's most powerful telescopes.
In their June 2013 paper in the Astrophysical Journal, the researchers presented the results of a new global radiation transport code coupled to a relativistic simulation of an accreting, non-rotating black hole. For the first time, they were able to re-create and explain nearly all the components seen in the X-ray spectra of stellar-mass black holes.
The ability to generate realistic light signals from a black hole simulation is a first and brings with it the possibility of explaining a whole host of observations taken with multiple X-ray satellites during the past 40 years.
"We felt excited and also incredibly lucky, like we'd turned up ten heads in a row," Noble said. "The simulations are very challenging and if you don't get it just right, it won't give you an accurate answer. This was the first time that people have put all of the pieces together from first principles in such a thorough way."
The simulations are the combined results of two computational codes. One, Harm3d, re-creates the three-dimensional dynamics of a black hole accreting gas, including its magnetohydrodynamics (MHD), which charts the interplay of electrically conducting fluids like plasmas and a powerful magnetic field.
"The magnetic field is important in the area outside the black hole because it whips the gas around and can dictate its dynamics," Noble said. "Also, the movement of the field can lead to it kinking and trigger a reconnection event that produces an explosive burst of energy, turning magnetic field energy into heat."
Though the MHD forces are critical near the black hole, it is the X-rays these forces generate that can be observed. The second component, a radiative transport code called Pandurata, simulates what real photons do.
"They bounce around inside the gas, they reflect off the disk's surface, and their wavelengths change along the way," he explained. "Eventually, they reach some distant light collector--a numerically approximated observer--which provides the predicted light output of our simulation."
The researchers' simulations were run on the Ranger supercomputer at the Texas Advanced Computing Center, built with support from the National Science Foundation, which also funded the group's research.
The simulations were the highest resolution thin disk simulations ever performed, with the most points and the smallest length-scales for numerical cells, allowing the researchers to resolve very small features. Varying only the rate at which the black holes accrete gas, they were able to reproduce the wide range of X-ray states seen in observations of most galactic black hole sources.
With each passing year, the significance of black holes--and their role in shaping the cosmos--grows.
Nearly every good-sized galaxy has a supermassive black hole at its center, said Julian Krolik, a professor of physics and astronomy at Johns Hopkins University. For periods of a few to tens of million years at a time, black holes accrete incredible amounts of gas ultimately released as huge amounts of energy--as much as a hundred times the power output of all the stars in a black hole host galaxy put together.
"Some of that energy can travel out into their surrounding galaxies as ionizing light or fast-moving jets of ionized gas," Krolik continued. "As a result, so much heat can be deposited in the gas orbiting around in those galaxies that it dramatically alters the way they make new stars. It's widely thought that processes like this are largely responsible for regulating how many stars big galaxies hold."
In this way black holes may act as cosmic regulators--all the more reason to use numerical simulations to uncover further clues about how black holes interact with gas, stars and other supermassive black holes.
Said Noble: "To see that it works and reproduces the observational data when the observational data is so complicated...it's really remarkable."
-- Aaron Dubrow, NSF
Investigators
Scott Noble
Julian Krolik
Jeremy Schnittman
John Boisseau
Karl Schulz
Omar Ghattas
Tommy Minyard
Yosef Zlochower
Manuela Campanelli
Related Institutions/Organizations
Rochester Institute of Tech
Johns Hopkins University
Goddard Space Flight Center
University of Texas at Austin
Let there be light
Simulations on NSF-supported supercomputer re-create X-rays emerging from the neighborhood of black holes
February 18, 2014
Black holes may be dark, but the areas around them definitely are not. These dense, spinning behemoths twist up gas and matter just outside their event horizon, and generate heat and energy that gets radiated, in part, as light. And when black holes merge, they produce a bright intergalactic burst that may act as a beacon for their collision.
Astrophysicists became deeply interested in black holes in the 1960s, but the idea of their event horizon was first intimated in a paper by Karl Schwarzschild published after Einstein introduced general relativity in 1915.
Knowledge about black holes--these still-unseen objects--has grown tremendously in recent years. Part of this growth comes from researchers' ability to use detailed numerical models and powerful supercomputers to simulate the complex dynamics near a black hole. This is no trivial matter. Warped spacetime, gas pressure, ionizing radiation, magnetized plasma--the list of phenomena that must be included in an accurate simulation goes on and on.
"It's not something that you want to do with a paper and pencil," said Scott Noble, an astrophysicist at the Rochester Institute of Technology (RIT).
Working with Jeremy Schnittman of Goddard Space Flight Center and Julian Krolik of Johns Hopkins University, Noble and his colleagues created a new tool that predicts the light that an accreting black hole would produce. They did so by modeling how photons hit gas particles in the disk around the black hole (also known as an accretion disk), generating light--specifically light in the X-ray spectrum--and producing signals detected with today's most powerful telescopes.
In their June 2013 paper in the Astrophysical Journal, the researchers presented the results of a new global radiation transport code coupled to a relativistic simulation of an accreting, non-rotating black hole. For the first time, they were able to re-create and explain nearly all the components seen in the X-ray spectra of stellar-mass black holes.
The ability to generate realistic light signals from a black hole simulation is a first and brings with it the possibility of explaining a whole host of observations taken with multiple X-ray satellites during the past 40 years.
"We felt excited and also incredibly lucky, like we'd turned up ten heads in a row," Noble said. "The simulations are very challenging and if you don't get it just right, it won't give you an accurate answer. This was the first time that people have put all of the pieces together from first principles in such a thorough way."
The simulations are the combined results of two computational codes. One, Harm3d, re-creates the three-dimensional dynamics of a black hole accreting gas, including its magnetohydrodynamics (MHD), which charts the interplay of electrically conducting fluids like plasmas and a powerful magnetic field.
"The magnetic field is important in the area outside the black hole because it whips the gas around and can dictate its dynamics," Noble said. "Also, the movement of the field can lead to it kinking and trigger a reconnection event that produces an explosive burst of energy, turning magnetic field energy into heat."
Though the MHD forces are critical near the black hole, it is the X-rays these forces generate that can be observed. The second component, a radiative transport code called Pandurata, simulates what real photons do.
"They bounce around inside the gas, they reflect off the disk's surface, and their wavelengths change along the way," he explained. "Eventually, they reach some distant light collector--a numerically approximated observer--which provides the predicted light output of our simulation."
The researchers' simulations were run on the Ranger supercomputer at the Texas Advanced Computing Center, built with support from the National Science Foundation, which also funded the group's research.
The simulations were the highest resolution thin disk simulations ever performed, with the most points and the smallest length-scales for numerical cells, allowing the researchers to resolve very small features. Varying only the rate at which the black holes accrete gas, they were able to reproduce the wide range of X-ray states seen in observations of most galactic black hole sources.
With each passing year, the significance of black holes--and their role in shaping the cosmos--grows.
Nearly every good-sized galaxy has a supermassive black hole at its center, said Julian Krolik, a professor of physics and astronomy at Johns Hopkins University. For periods of a few to tens of million years at a time, black holes accrete incredible amounts of gas ultimately released as huge amounts of energy--as much as a hundred times the power output of all the stars in a black hole host galaxy put together.
"Some of that energy can travel out into their surrounding galaxies as ionizing light or fast-moving jets of ionized gas," Krolik continued. "As a result, so much heat can be deposited in the gas orbiting around in those galaxies that it dramatically alters the way they make new stars. It's widely thought that processes like this are largely responsible for regulating how many stars big galaxies hold."
In this way black holes may act as cosmic regulators--all the more reason to use numerical simulations to uncover further clues about how black holes interact with gas, stars and other supermassive black holes.
Said Noble: "To see that it works and reproduces the observational data when the observational data is so complicated...it's really remarkable."
-- Aaron Dubrow, NSF
Investigators
Scott Noble
Julian Krolik
Jeremy Schnittman
John Boisseau
Karl Schulz
Omar Ghattas
Tommy Minyard
Yosef Zlochower
Manuela Campanelli
Related Institutions/Organizations
Rochester Institute of Tech
Johns Hopkins University
Goddard Space Flight Center
University of Texas at Austin
Wednesday, February 19, 2014
FACT SHEET: PRESIDENT OBAMA WILL SIGHT EO TO STREAMLINE EXPORT/IMPORT PROCESS
FROM: THE WHITE HOUSE
FACT SHEET: President Obama to Sign Executive Order on Streamlining the Export/Import Process for America’s Businesses
In his State of the Union address, President Obama set an ambitious agenda to make 2014 a year of action: using his pen and his phone to take steps that expand opportunity for America’s middle class – including helping small American businesses compete in a global economy. Today, aboard Air Force One, the President will sign a new Executive Order on Streamlining the Export/Import Process for America’s Businesses.
Specifically, the Executive Order cuts processing and approval times from days to minutes for small businesses that export American-made goods and services by completing the International Trade Data System (ITDS) by December 2016. Today, businesses must submit information to dozens of government agencies, often on paper forms, sometimes waiting on process for days to move goods across the border. The ITDS will allow businesses to electronically transmit, through a “single-window,” the data required by the U.S. Government to import or export cargo. This new electronic system will speed up the shipment of American-made goods overseas, eliminate often duplicative and burdensome paperwork, and make our government more efficient.
This Executive Order is especially important to small and medium companies that depend on global trade. Once fully implemented, the ITDS will dramatically reduce the time and expense for businesses to move the more than 50 million containers and $3.8 trillion worth of goods that cross our borders each year.
Development of a “Single-Window”
The Executive Order mandates the completion of the International Trade Data System (ITDS) by December 2016. The ITDS creates capabilities that will allow businesses to transmit, through an electronic “single-window,” the data required by the U.S. Government to import or export cargo.
At present, businesses must submit data to multiple agencies through various channels, often in paper form. The ITDS will save businesses time and money, and dramatically reduce the number of forms a business has to fill out to import or export.
The ITDS will allow more efficient government decision-making associated with goods arriving at the border, reducing the time for clearing goods from many days to, in some cases, seconds. This will dramatically speed the flow of legitimate commerce across our borders.
Coordinated and automated messaging about these decisions will increase predictability for the private sector and allow them to plan supply chain movements with greater confidence and less cost.
Though the development of the ITDS has been underway for some time, the Order establishes a deadline for completion, requires relevant agencies to transition from paper-based to electronic data collection, and calls for enhanced transparency by requiring public posting of implementation plans and schedules.
Creation of More Efficient Business Processes through Partnership
The new Executive Order also charges the government to partner with non-government stakeholders to build more efficient business processes and improve border management policies.
A newly expanded group, the Border Interagency Executive Council (BIEC) will be responsible for improving coordination among the dozens of agencies with import and export requirements and with outside stakeholders. The BIEC is charged with cutting red tape and reducing supply chain inefficiencies, while managing the risks presented by goods flowing in and out of the United States.
The ITDS Board of Directors will continue to oversee the development of the ITDS automated capabilities.
FACT SHEET: President Obama to Sign Executive Order on Streamlining the Export/Import Process for America’s Businesses
In his State of the Union address, President Obama set an ambitious agenda to make 2014 a year of action: using his pen and his phone to take steps that expand opportunity for America’s middle class – including helping small American businesses compete in a global economy. Today, aboard Air Force One, the President will sign a new Executive Order on Streamlining the Export/Import Process for America’s Businesses.
Specifically, the Executive Order cuts processing and approval times from days to minutes for small businesses that export American-made goods and services by completing the International Trade Data System (ITDS) by December 2016. Today, businesses must submit information to dozens of government agencies, often on paper forms, sometimes waiting on process for days to move goods across the border. The ITDS will allow businesses to electronically transmit, through a “single-window,” the data required by the U.S. Government to import or export cargo. This new electronic system will speed up the shipment of American-made goods overseas, eliminate often duplicative and burdensome paperwork, and make our government more efficient.
This Executive Order is especially important to small and medium companies that depend on global trade. Once fully implemented, the ITDS will dramatically reduce the time and expense for businesses to move the more than 50 million containers and $3.8 trillion worth of goods that cross our borders each year.
Development of a “Single-Window”
The Executive Order mandates the completion of the International Trade Data System (ITDS) by December 2016. The ITDS creates capabilities that will allow businesses to transmit, through an electronic “single-window,” the data required by the U.S. Government to import or export cargo.
At present, businesses must submit data to multiple agencies through various channels, often in paper form. The ITDS will save businesses time and money, and dramatically reduce the number of forms a business has to fill out to import or export.
The ITDS will allow more efficient government decision-making associated with goods arriving at the border, reducing the time for clearing goods from many days to, in some cases, seconds. This will dramatically speed the flow of legitimate commerce across our borders.
Coordinated and automated messaging about these decisions will increase predictability for the private sector and allow them to plan supply chain movements with greater confidence and less cost.
Though the development of the ITDS has been underway for some time, the Order establishes a deadline for completion, requires relevant agencies to transition from paper-based to electronic data collection, and calls for enhanced transparency by requiring public posting of implementation plans and schedules.
Creation of More Efficient Business Processes through Partnership
The new Executive Order also charges the government to partner with non-government stakeholders to build more efficient business processes and improve border management policies.
A newly expanded group, the Border Interagency Executive Council (BIEC) will be responsible for improving coordination among the dozens of agencies with import and export requirements and with outside stakeholders. The BIEC is charged with cutting red tape and reducing supply chain inefficiencies, while managing the risks presented by goods flowing in and out of the United States.
The ITDS Board of Directors will continue to oversee the development of the ITDS automated capabilities.
U.S. DEFENSE DEPARTMENT CONTRACTS FOR FEBRUARY 19, 2014
FROM: U.S. DEFENSE DEPARTMENT
CONTRACTS
ARMY
Raptor Training Services, LLC, Orlando, Fla., was awarded a $97,800,000 indefinite-delivery/indefinite-quantity, firm-fixed-price contract for Special Operations Forces requirements analysis, prototyping, training, operations and rehearsal and for operations and maintenance training support. Funding and performance location will be determined with each order. Estimated completion date is Feb. 12, 2019. Bids were solicited via the Internet with sixteen received. Army Program Executive Office Simulation, Training & Instrumentation, Orlando, Fla. is the contracting activity (W900KK-14-D-0001). (Awarded Feb.13, 2014)
Clark Construction Enterprises, LLC, St. Martinville, La. was awarded a $ 39,482,450 firm-fixed-price contract for the construction and installation of new drainage structures; construction of gravel access roads and ramps; installation of traffic control devices, installation of new highway embankment and pavement; installation of temporary water line utilities; and the permanent relocation of water line utilities, including tie-ins and connections, air release valves, and fire hydrants. Fiscal 2014 other procurement funds in the amount of $39,482,450 were obligated at the time of the award. Estimated completion date is Jan. 1, 2018. Bids were solicited via the Internet with six received. Work will be performed in Plaquemines Parish (Venice) La. Army Corps of Engineers, New Orleans, La. is the contracting activity (W912P8-14-C-0019).
DEFENSE LOGISTICS AGENCY
Raytheon Company, McKinney, Texas, has been awarded a maximum $98,189,220 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for surveillance system spare parts. This contract is a sole-source acquisition. This is a three-year base contract with no option periods. Location of performance is Texas with a Feb. 19, 2017 performance completion date. Using military services are Army and federal civilian agencies. Type of appropriation is fiscal year 2014 through fiscal year 2017 Army and defense working capital funds. The contracting activity is the Defense Logistics Agency Land and Maritime, Aberdeen Proving Ground, Md., (SPRBL1-14-D-0006).
US Foods, Inc., Lexington, S.C., has been awarded a maximum $72,000,000 fixed-price with economic-price-adjustment, bridge contract for prime vendor food and beverage support. This contract is a sole-source acquisition. Location of performance is South Carolina with a Feb. 14, 2015 performance completion date. Using military services are Army, Navy, Air Force, Marine Corps, and federal civilian agencies. Type of appropriation is fiscal year 2014 through fiscal year 2015 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pa., (SPM300-14-D-3662). (Awarded Feb. 14, 2014)
NAVY
Raytheon Integrated Defense Systems, Portsmouth, R.I., is being awarded a $35,545,309 fixed-price-incentive contract for the purchase of three AN/AQS-20A sonar, mine detecting sets with ancillary equipment. The AN/AQS-20A sonar, mine detecting set is a mine hunting and identification system with acoustic and identification sensors housed in an underwater towed body. The acoustic sensors are designed for the detection, classification and localization of bottom, close-tethered, and volume targets in a single pass. The identification sensor is designed for the identification of bottom mines. The system will be deployed from the Littoral Combat Ship as part of the Mine Countermeasures Mission Package. This contract includes options which, if exercised, would bring the cumulative value of this contract to $199,692,601. Work will be performed in Portsmouth, R.I. (56 percent); Tucson, Ariz. (21 percent); Pawcatuck, Conn. (6 percent); Middletown, R.I. (5 percent); Glen Rock, N.J. (2 percent); Windber, Pa. (2 percent); Cincinnati, Ohio (1 percent); Big Lake, Minn. (1 percent); Woodland Hills, Calif. (1 percent); Lewisburg, Tenn. (1 percent); Huntsville, Ala. (1 percent); Poway, Calif. (1 percent); North Springfield, Vt. (1 percent), and Hampton, Va. (1 percent), and is expected to be completed by February 2015. Fiscal 2013 and 2014 other procurement, Navy contract funds in the amount of $35,545,309 will be obligated and will not expire at the end of the current fiscal year. This contract was competitively procured via the Federal Business Opportunities website, with two offers received. The Naval Sea Systems Command, Washington, D.C., is the contracting activity (N00024-14-C-6302).
BAE Systems Land and Armaments L.P., Louisville, Ky., was awarded a $15,222,617 modification to a previously awarded contract (N00024-09-C-4137) on Feb. 18, 2014, to supply long lead time materials in support of the manufacture of the Virginia Class Submarine propulsors for SSN 792 and SSN 793. Work will be performed in Louisville, Ky., and is expected to be completed by February 2015. Fiscal 2013 shipbuilding and conversion, Navy funding in the amount of $7,611,308 will be obligated at time of the award, and funds will not expire at the end of the current fiscal year. This contract was not competitively procured, in accordance with 10 U.S.C. 2304(c)(1) and FAR 6.302-1, as there is only one responsible source and no other supplies or services will satisfy agency requirements. The Naval Sea Systems Command, Washington, D.C., is the contracting activity.
CONTRACTS
ARMY
Raptor Training Services, LLC, Orlando, Fla., was awarded a $97,800,000 indefinite-delivery/indefinite-quantity, firm-fixed-price contract for Special Operations Forces requirements analysis, prototyping, training, operations and rehearsal and for operations and maintenance training support. Funding and performance location will be determined with each order. Estimated completion date is Feb. 12, 2019. Bids were solicited via the Internet with sixteen received. Army Program Executive Office Simulation, Training & Instrumentation, Orlando, Fla. is the contracting activity (W900KK-14-D-0001). (Awarded Feb.13, 2014)
Clark Construction Enterprises, LLC, St. Martinville, La. was awarded a $ 39,482,450 firm-fixed-price contract for the construction and installation of new drainage structures; construction of gravel access roads and ramps; installation of traffic control devices, installation of new highway embankment and pavement; installation of temporary water line utilities; and the permanent relocation of water line utilities, including tie-ins and connections, air release valves, and fire hydrants. Fiscal 2014 other procurement funds in the amount of $39,482,450 were obligated at the time of the award. Estimated completion date is Jan. 1, 2018. Bids were solicited via the Internet with six received. Work will be performed in Plaquemines Parish (Venice) La. Army Corps of Engineers, New Orleans, La. is the contracting activity (W912P8-14-C-0019).
DEFENSE LOGISTICS AGENCY
Raytheon Company, McKinney, Texas, has been awarded a maximum $98,189,220 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for surveillance system spare parts. This contract is a sole-source acquisition. This is a three-year base contract with no option periods. Location of performance is Texas with a Feb. 19, 2017 performance completion date. Using military services are Army and federal civilian agencies. Type of appropriation is fiscal year 2014 through fiscal year 2017 Army and defense working capital funds. The contracting activity is the Defense Logistics Agency Land and Maritime, Aberdeen Proving Ground, Md., (SPRBL1-14-D-0006).
US Foods, Inc., Lexington, S.C., has been awarded a maximum $72,000,000 fixed-price with economic-price-adjustment, bridge contract for prime vendor food and beverage support. This contract is a sole-source acquisition. Location of performance is South Carolina with a Feb. 14, 2015 performance completion date. Using military services are Army, Navy, Air Force, Marine Corps, and federal civilian agencies. Type of appropriation is fiscal year 2014 through fiscal year 2015 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pa., (SPM300-14-D-3662). (Awarded Feb. 14, 2014)
NAVY
Raytheon Integrated Defense Systems, Portsmouth, R.I., is being awarded a $35,545,309 fixed-price-incentive contract for the purchase of three AN/AQS-20A sonar, mine detecting sets with ancillary equipment. The AN/AQS-20A sonar, mine detecting set is a mine hunting and identification system with acoustic and identification sensors housed in an underwater towed body. The acoustic sensors are designed for the detection, classification and localization of bottom, close-tethered, and volume targets in a single pass. The identification sensor is designed for the identification of bottom mines. The system will be deployed from the Littoral Combat Ship as part of the Mine Countermeasures Mission Package. This contract includes options which, if exercised, would bring the cumulative value of this contract to $199,692,601. Work will be performed in Portsmouth, R.I. (56 percent); Tucson, Ariz. (21 percent); Pawcatuck, Conn. (6 percent); Middletown, R.I. (5 percent); Glen Rock, N.J. (2 percent); Windber, Pa. (2 percent); Cincinnati, Ohio (1 percent); Big Lake, Minn. (1 percent); Woodland Hills, Calif. (1 percent); Lewisburg, Tenn. (1 percent); Huntsville, Ala. (1 percent); Poway, Calif. (1 percent); North Springfield, Vt. (1 percent), and Hampton, Va. (1 percent), and is expected to be completed by February 2015. Fiscal 2013 and 2014 other procurement, Navy contract funds in the amount of $35,545,309 will be obligated and will not expire at the end of the current fiscal year. This contract was competitively procured via the Federal Business Opportunities website, with two offers received. The Naval Sea Systems Command, Washington, D.C., is the contracting activity (N00024-14-C-6302).
BAE Systems Land and Armaments L.P., Louisville, Ky., was awarded a $15,222,617 modification to a previously awarded contract (N00024-09-C-4137) on Feb. 18, 2014, to supply long lead time materials in support of the manufacture of the Virginia Class Submarine propulsors for SSN 792 and SSN 793. Work will be performed in Louisville, Ky., and is expected to be completed by February 2015. Fiscal 2013 shipbuilding and conversion, Navy funding in the amount of $7,611,308 will be obligated at time of the award, and funds will not expire at the end of the current fiscal year. This contract was not competitively procured, in accordance with 10 U.S.C. 2304(c)(1) and FAR 6.302-1, as there is only one responsible source and no other supplies or services will satisfy agency requirements. The Naval Sea Systems Command, Washington, D.C., is the contracting activity.
STORE OWNER SENTENCED FOR SELLING CUTTING AGENTS TO DRUG DEALERS
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, February 19, 2014
Former Detroit Liquor Store Owner Sentenced for Tax Fraud and for Selling Cutting Agents to Drug Dealers
Bashar Saroki, a resident of Southfield, Mich., was sentenced today in the U.S. District Court for the Eastern District of Michigan to serve 30 months in prison to be followed by one year of supervised release, the Justice Department and the Internal Revenue Service (IRS) announced. Previously, Saroki pleaded guilty to filing a false 2009 tax return and offering drug paraphernalia for sale.
According to court documents, Saroki controlled and operated Golden Star Party Store, a liquor store that was located in Detroit. From 2007 through 2011, Saroki sold more than $1 million worth of a variety of cutting agents to local narcotics dealers out of Golden Star Party Store and from his residence. Narcotics dealers used these cutting agents to dilute the potency and increase the quantity of the narcotics they sold to customers. Saroki also filed a false tax return for 2009 that reported very little income despite the significant proceeds from the sale of cutting agents.
Assistant Attorney General Kathryn Keneally for the department's Tax Division commended the efforts of special agents of IRS-Criminal Investigation, who investigated this case, and Tax Division Trial Attorneys Kenneth C. Vert and Yael T. Epstein, who prosecuted the case.
Wednesday, February 19, 2014
Former Detroit Liquor Store Owner Sentenced for Tax Fraud and for Selling Cutting Agents to Drug Dealers
Bashar Saroki, a resident of Southfield, Mich., was sentenced today in the U.S. District Court for the Eastern District of Michigan to serve 30 months in prison to be followed by one year of supervised release, the Justice Department and the Internal Revenue Service (IRS) announced. Previously, Saroki pleaded guilty to filing a false 2009 tax return and offering drug paraphernalia for sale.
According to court documents, Saroki controlled and operated Golden Star Party Store, a liquor store that was located in Detroit. From 2007 through 2011, Saroki sold more than $1 million worth of a variety of cutting agents to local narcotics dealers out of Golden Star Party Store and from his residence. Narcotics dealers used these cutting agents to dilute the potency and increase the quantity of the narcotics they sold to customers. Saroki also filed a false tax return for 2009 that reported very little income despite the significant proceeds from the sale of cutting agents.
Assistant Attorney General Kathryn Keneally for the department's Tax Division commended the efforts of special agents of IRS-Criminal Investigation, who investigated this case, and Tax Division Trial Attorneys Kenneth C. Vert and Yael T. Epstein, who prosecuted the case.
READOUT: VP BIDEN CALL WITH UKRAINIAN PRESIDENT YANUKOVYCH
FROM: THE WHITE HOUSE
Readout of Vice President Biden's Call with Ukrainian President Viktor Yanukovych
Vice President Biden called Ukrainian President Viktor Yanukovych today to express grave concern regarding the crisis on the streets of Kiev. He called on President Yanukovych to pull back government forces and to exercise maximum restraint. The Vice President made clear that the United States condemns violence by any side, but that the government bears special responsibility to de-escalate the situation. The Vice President further underscored the urgency of immediate dialogue with opposition leaders to address protesters’ legitimate grievances and to put forward serious proposals for political reform. The United States is committed to supporting efforts to promote a peaceful resolution to the crisis that reflects the will and aspirations of the Ukrainian people.
Readout of Vice President Biden's Call with Ukrainian President Viktor Yanukovych
Vice President Biden called Ukrainian President Viktor Yanukovych today to express grave concern regarding the crisis on the streets of Kiev. He called on President Yanukovych to pull back government forces and to exercise maximum restraint. The Vice President made clear that the United States condemns violence by any side, but that the government bears special responsibility to de-escalate the situation. The Vice President further underscored the urgency of immediate dialogue with opposition leaders to address protesters’ legitimate grievances and to put forward serious proposals for political reform. The United States is committed to supporting efforts to promote a peaceful resolution to the crisis that reflects the will and aspirations of the Ukrainian people.
WHITE HOUSE RESPONSE TO CBO MINIMUM WAGE REPORT
FROM: THE WHITE HOUSE
On-the-Record Call by Jason Furman and Betsey Stevenson on the CBO Report on Minimum Wage
ON-THE-RECORD CONFERENCE CALL
COUNCIL OF ECONOMIC ADVISERS CHAIRMAN JASON FURMAN
AND CEA MEMBER BETSEY STEVENSON
ON THE CBO REPORT ON MINIMUM WAGE
COUNCIL OF ECONOMIC ADVISERS CHAIRMAN JASON FURMAN
AND CEA MEMBER BETSEY STEVENSON
ON THE CBO REPORT ON MINIMUM WAGE
Via Telephone
3:56 P.M. EST
MR. LEHRICH: Hey, everybody. Thanks for joining us. It’s Matt Lehrich from the White House Press Office. I know all of you are interested in our reaction to the CBO report today on minimum wage. And so I’m here with Jason Furman and Betsey Stevenson from the Council of Economic Advisers here at the White House.
And with that, I will turn it over to Jason.
MR. FURMAN: Thank you so much. I think you have all probably seen our blog post on the new CBO report. But just to quickly recap on some of the points we make, the new CBO report finds that 16.5 million workers would get a raise from increasing the minimum wage to $10.10 per hour. It would help millions of hardworking families reduce poverty and increase overall wages going to lower-income and moderate-income households.
In all of that analysis, the CBO is essentially confirming the consensus view: the consensus on the magnitude of workers helped; the consensus on the impact on poverty; I think very important, the consensus that, overall, wages and earnings would go up for low-moderate and middle-income households, even taking into account CBO’s estimates of employment; and then the overall consensus on issues like only a small minority of beneficiaries are teenagers.
On the issue of employment, CBO’s central estimate is that raising the minimum wage to $10.10 per hour would lead to a 0.3 percent decrease in employment. And CBO acknowledges that the employment impact could be essentially zero. But even those estimates do not reflect the overall consensus view of economists who have said that the minimum wage would have little or no impact on employment. And in our blog post we cite a wide range of evidence to that respect, including drawing on 64 different empirical studies of the minimum wage and the impact that it has on employment.
And if you take all of that as a whole, what that research basically finds is that raising the minimum wage increases motivation. It reduces some of the distractions that impact productivity that are related to poverty. It reduces absenteeism. It increases retention for workers on the job, and reduces turnover. And that when you take all of that into account, the overall benefits for productivity, plus the other margins on which firms can adjust -- for example, reduced profits -- mean that there is substantial literature that has found little or no employment impact on the minimum wage. And, in fact, a number of the leading studies from 1994 through the present published in peer review journals have in fact found precisely that, which is no impact on employment.
So, in summary, overall the report very much does make the case for a policy that benefits more than 16.5 million workers, reduces poverty, raises incomes. In doing that, it confirms a consensus -- it goes outside the consensus view of economists when it comes to the impact of the minimum wage on employment.
Q What’s your view on how high the minimum wage would have to go before the employment effects would be significant? I mean, I assume the White House picked $10.10 for some reason. Why not go higher if the effects are negligible at $10.10?
MR. FURMAN: Sure. Josh, the research we have on the minimum wage is within the range of the types of minimum wages we’ve seen at the federal, state and local level over the past couple of decades; $10.10 is well within that range. In fact, it would still be below the peak value of the minimum wage in the late 1960s. It would be below the real value of the minimum wage you’ve seen in some other cases. So for that reason we’re comfortable that that value is within the range that had been considered by the economic studies that we’re drawing on, in terms of its impact on employment.
Q Republicans obviously have already jumped on this report. Are you concerned that these numbers, even spun like you’re spinning them, will make it harder to pass an increase?
MR. FURMAN: Look, I think -- I’ve seen an awful lot of tweets from Democrats as well pointing out how many workers are helped, the reductions in poverty, the increases in income and all the other incredibly positive things this report finds. And even this report finds that the very large majority of the workers that it discusses here are benefitting. And I think that explains why this has overall been a very popular issue for the public. And I don’t think this report changes those facts or will change the public perception.
But as an economist, there have been a lot of studies of the minimum wage. We’ve had a chance to review those studies. This is not a piece of original research into the impact of the minimum wage on employment, and I think a lot of economists who have looked at that literature would summarize it differently than CBO has summarized it here.
Q I just wanted to ask you about something you said earlier. You said that the CBO report, the findings do not reflect the overall consensus view of economists. This is something similar to what you said in the briefing room about the other recent CBO report, the 10-year outlook. Can you talk about why the CEA is coming out and directly refuting something that the CBO -- why are you criticizing the CBO’s report in this way?
MR. FURMAN: When I went to the briefing room on the CBO report, on the employment impact of the Affordable Care Act, the principal argument that I made in that briefing room was that the CBO analysis was not about businesses cutting jobs, it was about choices by workers. I also pointed out there were other factors that CBO hadn’t factored in. But the main argument -- I would say most of what I was pointing out was precisely that.
The next day or the day after, CBO came out with a blog post that said exactly what I had been saying, which is this was not about businesses killing jobs, it was about a labor supply effect. And CBO Director, Doug Elmendorf, both in testimony to his blog, said that in a lot of cases that choice would be, for example, someone nearing retirement that might choose to retire now in a way that they couldn’t before, and that would benefit them and their family.
So there, the main issue was the report was being misinterpreted, and the interpretation I put forward was completely consistent with the interpretation that Doug Elmendorf put forward.
In terms of today’s, sometimes you have to have respectful disagreement between economists. When it comes to a budget estimate, usually the only estimate you have is CBO. And they have all of the expertise on that topic, and that's why we take those budget estimates very seriously.
We take this seriously too, but there are also dozens and dozens of other studies on the minimum wage that we can draw on and infer from. And an economist like Larry Katz, who is one of the leading labor economist experts in the country at Harvard University, is the type of person and authority on the issue of the minimum wage that I would generally look to and draw on.
So I don't think this is the Council of Economic Advisers versus CBO. I think the last one was all about a misinterpretation where CBO agreed with us. Today there is some difference of opinion about how to read the literature on the employment effect of the minimum wage. But that's a difference of opinion that I think a lot of economists would have as well.
Q Hey, Jason. This is RealClearPolitics. We’re all down here in the basement. I have a quick question for you. Would it have been more advisable for CBO’s report to outline in greater depth the ambiguities in the numbers, which is what CBO did in 2006 under Mr. Marron? Or is there sufficient information here in terms of how CBO, without doing original research, came to the conclusions?
MR. FURMAN: I don't want to edit someone else’s report -- and I can't say the report did. This is important -- it did say that 0.3 percent decrease in employment, and that there was a range where that range included essentially no impact on employment and that there were possibilities of estimates beyond that, which presumably would be a small increase in employment.
So their report does convey the possibility that there would be no impact on employment. Their report also does confirm that the greater purchasing power of low-income workers would in the short run boost the economy, which is another effect they have there. But I don't think the way the headline number is being presented reflects the consensus view of economists on this topic.
Q Hey, Jason. Thanks for doing this. Two questions. One, can you explain how it is that -- or the basis for accepting some of CBO’s conclusions -- it seems like the ones that support your position -- but not accepting the conclusions that don't support your position when they're based on the same economic assumptions in the same report? And also, what are you doing at this point to promote minimum wage passage in Congress?
MR. FURMAN: On your first, we put out our own report -- CEA did last week -- and some of the things here are consistent with that and consistent with other research. For example, does raising the minimum wage reduce poverty? There have been a number of studies that have addressed that question and almost all of them have come to the answer yes. In that case, CBO is restating a consensus. When it comes to employment, I think they are not restating what I would understand the consensus to be, and that’s where I think there is some respectful disagreement on the emphasis and the certainty around that magnitude of employment loss.
Could you repeat your second question?
Q Yes, absolutely. Just what are you doing to promote or push for minimum wage passage in Congress? I’m in the Capitol right now and there is certainly -- there’s a lot of debate over how hard the administration and Democrats are --
MR. FURMAN: I mean, the President has -- there are others that could speak to that better than I could, but it certainly was something he emphasized in the State of the Union. He emphasized again when he recently signed the EO raising the pay of federal -- people that work for federal contractors. The Council of Economic Advisers put out a report last week, and it’s something you’ll continue to see the President and the administration more broadly pushing on.
Q Jason, I want to be clear -- are you saying is your argument that what is flawed about CBO’s conclusion on employment has to do with their failure to take into account the adjustments that you cite in the last paragraph of the statement that you and Betsey Stevenson put out -- namely lower turnover, lower absenteeism?
MS. STEVENSON: So, this is Betsey. I think that that’s exactly right. While they’re not completely clear in the report how they’re thinking about that, I suspect that they are not fully appreciating how much the literature has moved in terms of understanding the cost savings that you get from reduced turnover when you raise the wages for lower-wage workers, from reduced absenteeism and from increased productivity.
So I think one of the conceptually harder things to appreciate is that there are important spillover effects. So if the lower-wage workers become more productive, are less likely to quit, have lower absenteeism, that not only means that you’re getting more productivity out of them, but to the extent that they influence the productivity of their coworkers you can overall see greater productivity.
And I think that that understanding in the literature is one of the things that has moved the profession towards believing that the employment effects are zero, and I think that CBO didn’t fully appreciate that in their review.
Q And just if I could follow up, is that the White House view that if you had to put a number on the employment effects, it would be zero rather than the number that CBO comes up with?
MR. FURMAN: Our view is that -- and this is Jason again -- that zero is a perfectly reasonable estimate of the impact of the minimum wage on employment based on research that began with David Card and Alan Krueger comparing minimum wage increase in New Jersey to fast food restaurants across the border in Pennsylvania that didn’t have them, to more recent research that’s taken basically the same method but applied it to hundreds of contiguous county pairs where one of them raised the minimum wage, one of them didn’t. You compare the employment in one county as compared to the other.
This is something economists have spent a long time studying, there’s a lot of papers on, and most of those papers are very close to zero. Some papers are negative. There’s probably some papers that have found -- people have gone out and run a regression and found a big increase in employment, decided that that probably isn’t true, correctly decided that and didn’t publish the paper. I think that doesn’t happen on the other side. If you find a large negative effect, those papers tend to be published, so there’s also some publication bias here. But when you look at some of the highest quality studies in all of it, I think it’s completely reasonable to think it would have zero impact on employment.
Q Jason, so the CBO report also looked at the effects of a $9 minimum wage, which of course is what President Obama first proposed a year ago. And it was only I think just a few months ago that he got on board with the Harkin-Miller plan of $10.10. So then the report, as you expected, the effects -- the positive and negative -- were more muted with the $9 one, but I think the effects on employment were somewhere on the order of like a fifth of the $10.10 proposal. And so I’m wondering if you feel like this would have been a much easier sell at $9, politically, and how secure you are in feeling that $10.10 is the right number here.
MR. FURMAN: I guess I’d say substantively it was one type of proposal that benefitted a wide swath of workers. This benefits 16.5 million directly below $10.10, and then CBO says that as many as 8 million who are just above that line would benefit. That’s substantially more than at $9 an hour. If you look at the poverty line for a family of four with one full-time worker who is working full-time, $10.10 takes that family -- if they’re working full-time -- at the minimum wage from below the poverty line to above the poverty line. And, as I said, we don’t accept the conclusion in this report that this reflects consensus of economists, and that zero employment within the range of $10.10, $9 -- any of those numbers -- would be a perfectly reasonable estimate of the employment impact.
Q I’m wondering, you’ve obviously been looking at this issue for a long time and I’m curious at what you’ve learned from studying minimum wage increases that have been enacted in the past and how that impacts your point of view for increasing the minimum wage now to $10.10.
MS. STEVENSON: This is Betsey. And Jason passed this to me because he sort of already stated this, so I’ll give you a second opinion. I’ve been also looking at minimum wage studies since my very first days in graduate school, and I really do believe that both the profession and the literature has moved towards thinking over the last couple of decades towards thinking the employment effects are small.
I think early on in the literature, people were really focused on this idea that sort of comes from that intro Ec class that many of you may have taken, which is that you assume that productivity doesn’t change or can’t be influenced by the rate of pay. And as I stated earlier, a new burgeoning literature has really pointed out that how much you pay people actually affects how they perform, what they do, and how much they produce. Once you have that relationship between pay and productivity, it changes the standard model in a way that means that you don’t get the loss of employment that that supply and demand X that you saw on the chalkboard, if you took introductory economics, would have demonstrated.
And that, plus the empirical estimate -- so a better understanding of the theory, the complexity of the theory, and hundreds of empirical estimates of the actual effect has really shifted at least how I view the employment effects of the minimum wage. And I think that I am really sort of in the middle of the distribution and the profession in terms of thinking about how the minimum wage affects employment.
MR. FURMAN: And then, just one thing to add is also people have looked across states or across counties that have changed it. And in addition to finding unemployment, as Betsey said, they’ve also found -- confirmed the more obvious things, which is that it raises incomes -- raising the minimum wage raises incomes and reduces poverty.
MR. LEHRICH: Thank you to Jason and Betsey, and to all of you for joining us today. As always, if you have follow-up questions or didn’t get your question in, don’t hesitate to check in with us. Otherwise, we’ll talk to you all next time. Thanks.
END
PRESS GAGGLE EN ROUTE TO TOLUCA, MEXICO
FROM: THE WHITE HOUSE
Press Gaggle en route Toluca, Mexico
PRESS GAGGLE BY
PRESS SECRETARY JAY CARNEY
AND DEPUTY NATIONAL SECURITY ADVISOR
FOR STRATEGIC COMMUNICATIONS BEN RHODES
Aboard Air Force One
En Route Toluca, Mexico
9:50 A.M. EST
MR. CARNEY: Good morning. Thank you for joining us on our early start this morning. We are making our way to Mexico for the North American Leaders Summit. And I have with me today Deputy National Security Advisor Ben Rhodes, who can assist on questions you may have about national security and foreign affairs.
Let me just start by saying, as I think you know, later on this flight, the President will sign an executive order on streamlining the export-import process for America’s businesses. In his State of the Union address, President Obama set an ambitious agenda to make 2014 a “Year of Action,” using his pen and his phone to take steps to expand opportunity for America’s middle class, including helping small, American businesses compete in a global economy.
Today, as I said, aboard Air Force One, the President will sign a new executive order on streamlining the export-import process for America’s businesses, specifically the executive order that cuts processing and approval times from days to minutes for small businesses that export American-made goods and services by completing the International Trade Data System by December 2016.
Today, businesses must submit information to dozens of government agencies, often on paper forms -- sometimes waiting on process for days to move goods across the border. The ITDS will allow businesses to electronically transmit through a single window the data required by the U.S. government to import or export cargo. This new electronic system will speed up the shipment of American-made goods overseas, eliminate often duplicative and burdensome paperwork, and make our government more efficient.
I have no other announcements to make, so if you have questions on domestic matters, why don't you fire away? And then we'll turn it over to Ben.
Q Ben, can you talk about -- (laughter.) Sorry, Jay, I’ll get back to you. Can you comment on the U.S. response to what’s going on in Ukraine, the violence there? Have there been conversations with both President Putin and with Ukrainian leadership?
MR. RHODES: Well, I think the scenes that we saw in Kyiv yesterday were completely outrageous and have no place in the 21st century. The fact of the matter is we have made it very clear to the Ukrainian government that it is their responsibility to allow for peaceful protest. We consistently oppose any use of violence by all sides, but the responsibility is on the government to pull back its riot police, to call a truce and to engage in a meaningful discussion with the opposition about the way forward.
Clearly, the people of Ukraine feel that their legitimate aspirations are not being met in the current political context, and it's incumbent on the Ukrainian government to reach out to the opposition and to find a way forward that can unify the country.
We have also made clear that Ukraine has a future that is a part of the Atlantic community, that Ukraine’s orientation towards Europe and the Transatlantic community is an important priority of U.S. foreign policy; that it is not a zero-sum game with Russia. We understand that Ukraine is a neighbor of Russia, has historic ties to Russia, but that that need not preclude Ukraine from, again, continuing to pursue a European path as well.
So Vice President Biden communicated our position to President Yanukovych yesterday. I know that Secretary Kerry, Victoria Nuland are working this with their counterparts, particularly as the EU prepares for a meeting. The only additional thing I'd say is that we continue to watch events very closely, including who we believe is responsible for violence, and we've made clear that we would consider taking action against individuals who are responsible for acts of violence within Ukraine. And we have a tool kit for doing that that includes sanctions.
Q Can you say whether the United States would consider following the European Union’s lead if they impose sanctions against the Ukraine as an institution?
MR. RHODES: Well, I think as a general matter we aim to be coordinated with the European Union and we have generally had a common position and spoken with a similar voice on issues related to Ukraine because we both have an interest in seeing an end to the violence and seeing the unity of Ukraine upheld and seeing Ukraine on a European orientation. So I think we are in consultation with the European Union on the questions like which individuals should be held responsible for the violence, and in consideration of issues like imposing sanctions related to the ongoing violence.
Q You guys have been talking about sanctions now for a while. What would it actually take to pull the trigger?
MR. RHODES: Well, I think the events that we saw yesterday are certainly heightening our focus on this issue and I think we'll be reviewing this, as we have been, on a near daily basis. And we also will be talking to the Europeans as they have their meeting of the EU foreign ministers, and we'll make a determination both on our own and, again, in consultation with the European Union about the next steps.
Q Is that near-term thing, though? I mean, would there be a determination like this within days, weeks?
MR. RHODES: Well, obviously, the situation is very fluid, so I don’t want to put a timeline on it or get ahead of any particular announcement. I will say that events like what we saw yesterday are clearly going to impact our decision-making. On the other hand, if the government takes the appropriate steps of pulling back riot police, of respecting the right of peaceful protest, releasing prisoners and pursuing serious dialogue with the opposition about how to pursue a more unified government and way forward, that would obviously factor into our calculus as well.
But, clearly, the United States and the European Union believe that the events of yesterday were unacceptable. And I think that’s why you see renewed diplomatic activity this week.
Q To what extent does Russia have a role in either reducing the violence or creating additional disturbances?
MR. RHODES: Well, I think the message that we delivered to the Russians is that, again, we are not in some competition for the future of Ukraine. Frankly, our interest is that the people of Ukraine are able to determine their future, not any external actor. Clearly, we believe that a significant number of Ukrainians believe very deeply in the importance of Ukraine pursuing a European orientation, even as they maintain relations with Russia as a neighbor.
And so the role we would like to see Russia play is of constructive support for reducing these tensions and allowing the Ukrainian people to determine their own future, and that we don’t think that there should be, again, a situation where Russia is viewing this as some competition with the European Union or the United States; rather, we all have an interest in a Ukraine that is stable. And, clearly, the status quo is not a recipe for stability, because too many Ukrainians are feeling like their own aspirations are not being met in this government and in this plan that turns away from Europe. So that’s the message we delivered to the Ukrainian government and the Russian government as well.
Q So far, Vice President Biden has been your main interlocutor on this. Is there a point at which the President gets to follow up directly?
MR. RHODES: Yes, I would expect the President -- he’s been involved in the sense that he’s followed the situation very closely. He’s discussed it with counterparts in the past; with President Hollande this was a subject of discussion. And I’d expect the President to be involved in the days to come as well.
Again, he has pressed us to make sure we’re doing everything we can to try to reduce tensions and to try to stabilize the situation and support the democratic aspirations of the Ukrainian people for a more unified government and a government that has the ability to pursue a European orientation as well as good relations with Russia.
So I’d expect him to be involved. I’d expect it to come up today, frankly. It’s a pressing global issue and I’m sure he’ll be discussing this with President Peña Nieto and Prime Minister Harper.
Q Is he watching any of the television footage from Kyiv or anything?
MR. RHODES: I don’t know if he’s -- we’d have to ask him that. I’m not aware that he’s seen particular footage, but he has been getting very regular updates on the situation in Ukraine.
Q Do you expect the President to say anything publicly today or for it to be more in the meetings with the other leaders?
MR. RHODES: I mean, obviously, it’s not the focus of these meetings. The focus of these meetings is our North American partnership, trade and commerce, and increasing economic competitiveness in the North American region, security issues.
However, it being a significant global issue, I’d anticipate that he will have some public comment on it, as well as comment with the other leaders.
Q Jay, can you talk about the executive order a little bit? This system has been in the works for a while. Why was an executive order necessary?
MR. CARNEY: Because the President has the authority through an executive order to streamline the process on behalf of American businesses, in particular small businesses. And, as you know, while he has taken an approach since he took office that includes not just acting legislatively, but using his executive authority where he can on behalf of the American people, he has tasked his team with finding opportunities for him to use that authority in a way that benefits the American economy and the American people. This is an example of that.
Q Jay, you said numerous times in recent days that it's no surprise that Democrats as well as Republicans have their problems with trade-expanding agreements. But the enthusiasm among Democrats seems particularly slight this time around compared to last -- past rounds of big trade deals. What can the President say to reassure Peña Nieto and Harper that there’s any hope whatsoever for accomplishing trade deals this year?
MR. CARNEY: Well, as you know, Mark, the President has made clear that expanding American exports and trade, especially in the Pacific region, is a priority. And the reason for that is that there’s enormous growth and opportunity in that region, and absent an agreement that allows for expansion we would cede that territory to our competitors, which would be detrimental to our economy, to our middle class. He is pursuing an agreement, the TPP, that explicitly protects American workers and the environment, and that he believes would be highly beneficial to our economy and the middle class. So it’s a conversation he has and others have with lawmakers of both parties.
I think it’s worth noting that this is an issue around which there is not a uniform point of view in either party. And the President has long understood that. And I think it is worth noting that this is nothing new, especially for those of us who have been around Washington for more than 20 years.
But that doesn’t mean that there’s not a reason to make it a priority. The President believes it's a priority and he’ll continue to have those conversations. And I’m sure he'll make his views known in his conversations with the other two leaders today.
MR. RHODES: One thing to add is that this has been an ongoing negotiation for several years, so there’s been a very sustained effort over a period of years, precisely because this represents an agreement that would encompass 40 percent of the global economy and have huge opportunity for the United States and the countries involved. That’s part of the reason why Canada and Mexico came into this process.
What I’d say also, though, is that, first of all, we see this as an opportunity to introduce elevated standards on issues like labor and the environment that were not in NAFTA. So, in many respects, it’s an opportunity to, again, elevate the standards that were absent from the NAFTA agreement so that we are dealing with issues like labor and environmental standards that are important to 21st century trade.
The other thing I’d say, though, is that as you get further along in a trade negotiation, there are sensitive issues in every country. Trade is not simply an issue that has a significant range of opinions in the United States. Every country in a negotiation always has constituencies that have a divergence of views on issues in a trade agreement.
So I think these leaders, like all leaders involved in the agreement, understand and appreciate that. As you continue towards the end of a negotiation, you get into sensitive issues and you will have an effort undertaken to build support for an agreement. And so I think the leaders know exactly where things are in the negotiation and appreciate that.
Q Can you explain the decision to make this such a short trip? Any concern at all that this could be viewed as a bit of a snub by Mexico?
MR. RHODES: No, I don’t think so. This is our second visit to Mexico since President Peña Nieto became President. We had a full bilateral summit in Mexico City and had two days of good meetings and a dinner with the President the last time we were here. So this is not the first time the President has been to Mexico since President Peña Nieto took office.
I think if you look at the history of the North American Leaders Summit, it’s generally a one-day meeting, so this is consistent with summits that have been held in the past, including summits in the United States.
Q Jay, on Keystone, Harper told reporters yesterday his message to our President will be the same as he said publicly. What will President Obama’s message be back to Harper on that discussion today?
MR. CARNEY: He will say the same thing that he and I and others have said publicly, which is this a process that is run out of the State Department in keeping with past practice of administrations of both parties. We have reached a stage in that process with the release of the environmental impact statement. We’re now in a phase where there is input from agencies -- others agencies and from the public, and that that process needs to be insulated from politics -- that’s the President’s view -- and that he will explain that to both leaders. I’m sure they’re fully aware of that dynamic.
Q Do you think you can say the timeline of a likely decision, though, without commenting on the substance of it?
MR. CARNEY: The timeline is as I just relayed to you and we’ve discussed publicly, and it’s something that is institutionalized by the State Department. And we’re now in a phase of input from agencies and the public, and the process will move forward. But we’re not going to alter the process; we’re going to let it proceed the way it should, because these are issues, as the President said, that have to be determined based on what is viewed as in the best national interest of the United States.
Q Immigration is a big issue in Mexico. In his bilat with President Peña Nieto, what will be the President’s assessment of the best chances on the timing of passage of immigration reform?
MR. CARNEY: The President continues to believe that 2014 presents the best opportunity we’ve had to see comprehensive immigration reform become law. We obviously have a ways to go, but the Senate has passed a bill with bipartisan support and a large majority. The House, through its leadership, has taken steps by putting forth standards and principles. That’s a new development this year that represents progress and demonstrates that Republican leaders recognize the value of immigration reform and the benefit that it would provide to our economy, to our border security, to our middle class, and to innovation for our businesses.
So I’m sure the President will update both leaders on where that stands, and his hope and belief that the question around comprehensive immigration reform is not if but when, and we hope it’s this year.
Q Are you guys having any kind of communiqué or deliverable-specific tangible things you’re planning to announce as a result of today? Or is it mainly a matter of catching up and sort of updating each other on where things stand?
MR. RHODES: I’d expect there to be a leaders’ statement at the conclusion of the summit that addresses the agenda that we will have worked on. And again, I think if you look at the North American Leaders Summit, it’s been a venue for us to do two things: in the near term, to work through specific issues related to trade and commerce. That gets at cross-border trade, customs issues, supporting the free flow of commerce, but also secure borders, efforts to promote security in North America more broadly. We have energy cooperation and cooperation on climate change. So there’s a range of near-term steps that they’ll be discussing today and I think we’ll be able to address at the conclusion of the summit.
At the same time, we’re also looking to what is our vision for North America more broadly going forward. It’s a huge asset of the United States, frankly, to have such close relationships with our two neighbors, two significant trading partners. And we cooperate on issues that run the gamut from trade to the environment, to energy and climate change, to security. And so what is the vision of a stable, secure, prosperous North America looking ahead, I think they’ll also be addressing that as well.
Q Obviously, going at a time when we’re marking the 20th anniversary of NAFTA, a lot of debate -- good, bad. What is the President’s assessment of NAFTA? Even though he’s had some issues with it, was it overall a success? Was it something that he wishes didn’t happen? What is his view of that?
MR. RHODES: Well, I think, on the one hand, NAFTA supports a huge amount of trade that supports a significant number of U.S. jobs. If you look at the trade between the United States and Mexico and Canada, millions of U.S. jobs are associated with that. I think it has led to a more prosperous and competitive North America as a whole within the global economy. So there has been progress that is rooted in the trade relationship between the United States, Canada and Mexico.
At the same time, there are issues that were not addressed in NAFTA, like the labor and environmental standards that the President has spoken about in the past and that, frankly, are a part of the TPP agreement.
So we see NAFTA as providing, clearly, a foundation for trade in North America that can be improved and enhanced by elevating the standards of trade to include the issues that are of increasing attention to us. And if you look at TPP, that’s labor and the environment, but also issues related to intellectual property and state-owned enterprises, access to the Pacific markets.
So what you really want, Peter, is a dynamic where the North American competitiveness allows us to be drivers in terms of getting into the fastest emerging markets in the world, which are in this Asia Pacific region. And so we’re in a good position to do that given our own trade relationship, but we also can, frankly, go back and elevate some of the issues that were not a part of the original agreement through the TPP.
Q Ben, last year when we were in Mexico, one of the issues that hung over at those meetings was the level of cooperation taking place between the new Peña Nieto administration and the U.S. over security. What’s the status of that? Has the Peña Nieto administration made inroads on the security issue to the satisfaction of the U.S.? What’s the U.S. view of security?
MR. RHODES: We have maintained our security cooperation with Mexico. We are very pleased with the level of cooperation that we have with the Mexican government in addressing the narcotrafficking issue. President Peña Nieto is focused on reducing the levels of violence, broadly. We continue to provide whatever support the Mexican government asks us for and requires as they deal with huge border security -- huge issues of violence around the border, and because of the narcotrafficking issue. At the same time, we’ve continued to make clear our own responsibilities to crack down, for instance, on the flow of guns southward, which has been an element of the violence there.
So the cooperation has continued. It’s certainly been good from our perspective, and I’m sure that they’ll address it in their bilateral meeting, as well as in the trilat.
MR. CARNEY: Can I just say, since nobody asked -- hey, Christi, did you have a question?
Q No.
MR. CARNEY: Well, so a couple of things have happened this week related to the President’s primary focus on growing the economy and expanding opportunity that are rather remarkable. First of all, you see Republicans lining up en masse against raising the minimum wage, which is a remarkable development if you think about it. You have Americans across the country working full-time and yet being paid a wage that keeps them in poverty. That’s not something that should happen in this country. And the American people, including Republicans’ constituents, overwhelmingly support lifting the minimum wage. As the CBO report demonstrated, that would lift something on the order of 900,000 Americans out of poverty and raise the wages for 16 million-plus Americans across the country. And as Jason Furman said, the substantial consensus among economists is that it would not have a negative impact on jobs.
The second thing that happened was the five-year anniversary of the Recovery Act. And as a point of personal privilege as somebody who was covering these matters back in the early ‘90s, I find it remarkable that Speaker Boehner attacks the President for the Recovery Act. I remember when Speaker Boehner powerfully argued against President Clinton’s economic agenda, said that it would lead to stagnation and job loss. He could not have been more wrong then. We saw record job creation. Speaker Boehner was wrong.
Speaker Boehner argued powerfully against the Recovery Act and President Obama’s economic agenda. In the wake of the worst recession since the Great Depression, we've seen the creation of 8.5 million private sector jobs. Speaker Boehner could not have been more wrong. In between, Speaker Boehner supported economic policies that helped to precipitate the worst financial crisis and economic crisis in our lifetimes and, by the way, led to record deficits, which were handed over to President Obama when he took office.
It's very important to have the long view here. And what we know about the Recovery Act is that it delivered tax cuts, it delivered investments in clean energy, it delivered an infusion in an economy that was teetering on the brink of collapse. And the alternative at the time, as you remember if you saw the headlines, was the potential for depression, some predicting 20 to 25 percent unemployment. Republicans refused to support a plan that saved the country from that kind of disaster and set us on the course towards job creation and economic growth.
This is not a project that's anywhere near done. That's why the President remains focused principally on growing the economy, helping the middle class. And certainly raising the minimum wage is a way to do that.
Q Jay, since you brought it up, on the CBO, it’s been remarkable cherry-picking of the results of the conclusions of that report by both sides. How can it be that those economists can be right on one issue from your side, the raising people out of poverty, but so wrong on the job costs of that report? And is there a danger in going after what is usually considered a fairly neutral arbiter of economic issues and budget issues?
MR. CARNEY: Jim, we're not going after anyone. As Jason Furman, the President’s chief economist, said yesterday, we respectfully disagree with that particular conclusion and point to the deep and wide body of academic research on this that supports our view. But it’s not about -- obviously we have enormous respect for the CBO, and I think that’s reflected in the fact that we point to some of the other conclusions in that report.
It’s just demonstrated by history and, again, by the work of many experts in the field that there’s likely to have no negative impact in terms of job creation by raising the minimum wage, which spurs economic activity, lifts people out of poverty, and raises the wages for Americans across the country, including middle-class Americans. But again, that’s a respectful disagreement on a particular finding in which the experts in the field have expressed a different view.
Q But you must have felt that that report was damaging to your efforts to get support for raising the minimum wage.
MR. CARNEY: Look, I think that Republicans who, against the overwhelming opinion of the American people, rally around that particular item in the report to suggest that we can’t give Americans a raise risk more damage to themselves and politically, as well as to the middle class economically, and to Americans economically.
So I don’t think we view it that way. Support for raising the minimum wage is broad and deep. We’ve seen states take action, and we’re going to continue to press the Congress to take action.
Thank you.
END
Press Gaggle en route Toluca, Mexico
PRESS GAGGLE BY
PRESS SECRETARY JAY CARNEY
AND DEPUTY NATIONAL SECURITY ADVISOR
FOR STRATEGIC COMMUNICATIONS BEN RHODES
Aboard Air Force One
En Route Toluca, Mexico
9:50 A.M. EST
MR. CARNEY: Good morning. Thank you for joining us on our early start this morning. We are making our way to Mexico for the North American Leaders Summit. And I have with me today Deputy National Security Advisor Ben Rhodes, who can assist on questions you may have about national security and foreign affairs.
Let me just start by saying, as I think you know, later on this flight, the President will sign an executive order on streamlining the export-import process for America’s businesses. In his State of the Union address, President Obama set an ambitious agenda to make 2014 a “Year of Action,” using his pen and his phone to take steps to expand opportunity for America’s middle class, including helping small, American businesses compete in a global economy.
Today, as I said, aboard Air Force One, the President will sign a new executive order on streamlining the export-import process for America’s businesses, specifically the executive order that cuts processing and approval times from days to minutes for small businesses that export American-made goods and services by completing the International Trade Data System by December 2016.
Today, businesses must submit information to dozens of government agencies, often on paper forms -- sometimes waiting on process for days to move goods across the border. The ITDS will allow businesses to electronically transmit through a single window the data required by the U.S. government to import or export cargo. This new electronic system will speed up the shipment of American-made goods overseas, eliminate often duplicative and burdensome paperwork, and make our government more efficient.
I have no other announcements to make, so if you have questions on domestic matters, why don't you fire away? And then we'll turn it over to Ben.
Q Ben, can you talk about -- (laughter.) Sorry, Jay, I’ll get back to you. Can you comment on the U.S. response to what’s going on in Ukraine, the violence there? Have there been conversations with both President Putin and with Ukrainian leadership?
MR. RHODES: Well, I think the scenes that we saw in Kyiv yesterday were completely outrageous and have no place in the 21st century. The fact of the matter is we have made it very clear to the Ukrainian government that it is their responsibility to allow for peaceful protest. We consistently oppose any use of violence by all sides, but the responsibility is on the government to pull back its riot police, to call a truce and to engage in a meaningful discussion with the opposition about the way forward.
Clearly, the people of Ukraine feel that their legitimate aspirations are not being met in the current political context, and it's incumbent on the Ukrainian government to reach out to the opposition and to find a way forward that can unify the country.
We have also made clear that Ukraine has a future that is a part of the Atlantic community, that Ukraine’s orientation towards Europe and the Transatlantic community is an important priority of U.S. foreign policy; that it is not a zero-sum game with Russia. We understand that Ukraine is a neighbor of Russia, has historic ties to Russia, but that that need not preclude Ukraine from, again, continuing to pursue a European path as well.
So Vice President Biden communicated our position to President Yanukovych yesterday. I know that Secretary Kerry, Victoria Nuland are working this with their counterparts, particularly as the EU prepares for a meeting. The only additional thing I'd say is that we continue to watch events very closely, including who we believe is responsible for violence, and we've made clear that we would consider taking action against individuals who are responsible for acts of violence within Ukraine. And we have a tool kit for doing that that includes sanctions.
Q Can you say whether the United States would consider following the European Union’s lead if they impose sanctions against the Ukraine as an institution?
MR. RHODES: Well, I think as a general matter we aim to be coordinated with the European Union and we have generally had a common position and spoken with a similar voice on issues related to Ukraine because we both have an interest in seeing an end to the violence and seeing the unity of Ukraine upheld and seeing Ukraine on a European orientation. So I think we are in consultation with the European Union on the questions like which individuals should be held responsible for the violence, and in consideration of issues like imposing sanctions related to the ongoing violence.
Q You guys have been talking about sanctions now for a while. What would it actually take to pull the trigger?
MR. RHODES: Well, I think the events that we saw yesterday are certainly heightening our focus on this issue and I think we'll be reviewing this, as we have been, on a near daily basis. And we also will be talking to the Europeans as they have their meeting of the EU foreign ministers, and we'll make a determination both on our own and, again, in consultation with the European Union about the next steps.
Q Is that near-term thing, though? I mean, would there be a determination like this within days, weeks?
MR. RHODES: Well, obviously, the situation is very fluid, so I don’t want to put a timeline on it or get ahead of any particular announcement. I will say that events like what we saw yesterday are clearly going to impact our decision-making. On the other hand, if the government takes the appropriate steps of pulling back riot police, of respecting the right of peaceful protest, releasing prisoners and pursuing serious dialogue with the opposition about how to pursue a more unified government and way forward, that would obviously factor into our calculus as well.
But, clearly, the United States and the European Union believe that the events of yesterday were unacceptable. And I think that’s why you see renewed diplomatic activity this week.
Q To what extent does Russia have a role in either reducing the violence or creating additional disturbances?
MR. RHODES: Well, I think the message that we delivered to the Russians is that, again, we are not in some competition for the future of Ukraine. Frankly, our interest is that the people of Ukraine are able to determine their future, not any external actor. Clearly, we believe that a significant number of Ukrainians believe very deeply in the importance of Ukraine pursuing a European orientation, even as they maintain relations with Russia as a neighbor.
And so the role we would like to see Russia play is of constructive support for reducing these tensions and allowing the Ukrainian people to determine their own future, and that we don’t think that there should be, again, a situation where Russia is viewing this as some competition with the European Union or the United States; rather, we all have an interest in a Ukraine that is stable. And, clearly, the status quo is not a recipe for stability, because too many Ukrainians are feeling like their own aspirations are not being met in this government and in this plan that turns away from Europe. So that’s the message we delivered to the Ukrainian government and the Russian government as well.
Q So far, Vice President Biden has been your main interlocutor on this. Is there a point at which the President gets to follow up directly?
MR. RHODES: Yes, I would expect the President -- he’s been involved in the sense that he’s followed the situation very closely. He’s discussed it with counterparts in the past; with President Hollande this was a subject of discussion. And I’d expect the President to be involved in the days to come as well.
Again, he has pressed us to make sure we’re doing everything we can to try to reduce tensions and to try to stabilize the situation and support the democratic aspirations of the Ukrainian people for a more unified government and a government that has the ability to pursue a European orientation as well as good relations with Russia.
So I’d expect him to be involved. I’d expect it to come up today, frankly. It’s a pressing global issue and I’m sure he’ll be discussing this with President Peña Nieto and Prime Minister Harper.
Q Is he watching any of the television footage from Kyiv or anything?
MR. RHODES: I don’t know if he’s -- we’d have to ask him that. I’m not aware that he’s seen particular footage, but he has been getting very regular updates on the situation in Ukraine.
Q Do you expect the President to say anything publicly today or for it to be more in the meetings with the other leaders?
MR. RHODES: I mean, obviously, it’s not the focus of these meetings. The focus of these meetings is our North American partnership, trade and commerce, and increasing economic competitiveness in the North American region, security issues.
However, it being a significant global issue, I’d anticipate that he will have some public comment on it, as well as comment with the other leaders.
Q Jay, can you talk about the executive order a little bit? This system has been in the works for a while. Why was an executive order necessary?
MR. CARNEY: Because the President has the authority through an executive order to streamline the process on behalf of American businesses, in particular small businesses. And, as you know, while he has taken an approach since he took office that includes not just acting legislatively, but using his executive authority where he can on behalf of the American people, he has tasked his team with finding opportunities for him to use that authority in a way that benefits the American economy and the American people. This is an example of that.
Q Jay, you said numerous times in recent days that it's no surprise that Democrats as well as Republicans have their problems with trade-expanding agreements. But the enthusiasm among Democrats seems particularly slight this time around compared to last -- past rounds of big trade deals. What can the President say to reassure Peña Nieto and Harper that there’s any hope whatsoever for accomplishing trade deals this year?
MR. CARNEY: Well, as you know, Mark, the President has made clear that expanding American exports and trade, especially in the Pacific region, is a priority. And the reason for that is that there’s enormous growth and opportunity in that region, and absent an agreement that allows for expansion we would cede that territory to our competitors, which would be detrimental to our economy, to our middle class. He is pursuing an agreement, the TPP, that explicitly protects American workers and the environment, and that he believes would be highly beneficial to our economy and the middle class. So it’s a conversation he has and others have with lawmakers of both parties.
I think it’s worth noting that this is an issue around which there is not a uniform point of view in either party. And the President has long understood that. And I think it is worth noting that this is nothing new, especially for those of us who have been around Washington for more than 20 years.
But that doesn’t mean that there’s not a reason to make it a priority. The President believes it's a priority and he’ll continue to have those conversations. And I’m sure he'll make his views known in his conversations with the other two leaders today.
MR. RHODES: One thing to add is that this has been an ongoing negotiation for several years, so there’s been a very sustained effort over a period of years, precisely because this represents an agreement that would encompass 40 percent of the global economy and have huge opportunity for the United States and the countries involved. That’s part of the reason why Canada and Mexico came into this process.
What I’d say also, though, is that, first of all, we see this as an opportunity to introduce elevated standards on issues like labor and the environment that were not in NAFTA. So, in many respects, it’s an opportunity to, again, elevate the standards that were absent from the NAFTA agreement so that we are dealing with issues like labor and environmental standards that are important to 21st century trade.
The other thing I’d say, though, is that as you get further along in a trade negotiation, there are sensitive issues in every country. Trade is not simply an issue that has a significant range of opinions in the United States. Every country in a negotiation always has constituencies that have a divergence of views on issues in a trade agreement.
So I think these leaders, like all leaders involved in the agreement, understand and appreciate that. As you continue towards the end of a negotiation, you get into sensitive issues and you will have an effort undertaken to build support for an agreement. And so I think the leaders know exactly where things are in the negotiation and appreciate that.
Q Can you explain the decision to make this such a short trip? Any concern at all that this could be viewed as a bit of a snub by Mexico?
MR. RHODES: No, I don’t think so. This is our second visit to Mexico since President Peña Nieto became President. We had a full bilateral summit in Mexico City and had two days of good meetings and a dinner with the President the last time we were here. So this is not the first time the President has been to Mexico since President Peña Nieto took office.
I think if you look at the history of the North American Leaders Summit, it’s generally a one-day meeting, so this is consistent with summits that have been held in the past, including summits in the United States.
Q Jay, on Keystone, Harper told reporters yesterday his message to our President will be the same as he said publicly. What will President Obama’s message be back to Harper on that discussion today?
MR. CARNEY: He will say the same thing that he and I and others have said publicly, which is this a process that is run out of the State Department in keeping with past practice of administrations of both parties. We have reached a stage in that process with the release of the environmental impact statement. We’re now in a phase where there is input from agencies -- others agencies and from the public, and that that process needs to be insulated from politics -- that’s the President’s view -- and that he will explain that to both leaders. I’m sure they’re fully aware of that dynamic.
Q Do you think you can say the timeline of a likely decision, though, without commenting on the substance of it?
MR. CARNEY: The timeline is as I just relayed to you and we’ve discussed publicly, and it’s something that is institutionalized by the State Department. And we’re now in a phase of input from agencies and the public, and the process will move forward. But we’re not going to alter the process; we’re going to let it proceed the way it should, because these are issues, as the President said, that have to be determined based on what is viewed as in the best national interest of the United States.
Q Immigration is a big issue in Mexico. In his bilat with President Peña Nieto, what will be the President’s assessment of the best chances on the timing of passage of immigration reform?
MR. CARNEY: The President continues to believe that 2014 presents the best opportunity we’ve had to see comprehensive immigration reform become law. We obviously have a ways to go, but the Senate has passed a bill with bipartisan support and a large majority. The House, through its leadership, has taken steps by putting forth standards and principles. That’s a new development this year that represents progress and demonstrates that Republican leaders recognize the value of immigration reform and the benefit that it would provide to our economy, to our border security, to our middle class, and to innovation for our businesses.
So I’m sure the President will update both leaders on where that stands, and his hope and belief that the question around comprehensive immigration reform is not if but when, and we hope it’s this year.
Q Are you guys having any kind of communiqué or deliverable-specific tangible things you’re planning to announce as a result of today? Or is it mainly a matter of catching up and sort of updating each other on where things stand?
MR. RHODES: I’d expect there to be a leaders’ statement at the conclusion of the summit that addresses the agenda that we will have worked on. And again, I think if you look at the North American Leaders Summit, it’s been a venue for us to do two things: in the near term, to work through specific issues related to trade and commerce. That gets at cross-border trade, customs issues, supporting the free flow of commerce, but also secure borders, efforts to promote security in North America more broadly. We have energy cooperation and cooperation on climate change. So there’s a range of near-term steps that they’ll be discussing today and I think we’ll be able to address at the conclusion of the summit.
At the same time, we’re also looking to what is our vision for North America more broadly going forward. It’s a huge asset of the United States, frankly, to have such close relationships with our two neighbors, two significant trading partners. And we cooperate on issues that run the gamut from trade to the environment, to energy and climate change, to security. And so what is the vision of a stable, secure, prosperous North America looking ahead, I think they’ll also be addressing that as well.
Q Obviously, going at a time when we’re marking the 20th anniversary of NAFTA, a lot of debate -- good, bad. What is the President’s assessment of NAFTA? Even though he’s had some issues with it, was it overall a success? Was it something that he wishes didn’t happen? What is his view of that?
MR. RHODES: Well, I think, on the one hand, NAFTA supports a huge amount of trade that supports a significant number of U.S. jobs. If you look at the trade between the United States and Mexico and Canada, millions of U.S. jobs are associated with that. I think it has led to a more prosperous and competitive North America as a whole within the global economy. So there has been progress that is rooted in the trade relationship between the United States, Canada and Mexico.
At the same time, there are issues that were not addressed in NAFTA, like the labor and environmental standards that the President has spoken about in the past and that, frankly, are a part of the TPP agreement.
So we see NAFTA as providing, clearly, a foundation for trade in North America that can be improved and enhanced by elevating the standards of trade to include the issues that are of increasing attention to us. And if you look at TPP, that’s labor and the environment, but also issues related to intellectual property and state-owned enterprises, access to the Pacific markets.
So what you really want, Peter, is a dynamic where the North American competitiveness allows us to be drivers in terms of getting into the fastest emerging markets in the world, which are in this Asia Pacific region. And so we’re in a good position to do that given our own trade relationship, but we also can, frankly, go back and elevate some of the issues that were not a part of the original agreement through the TPP.
Q Ben, last year when we were in Mexico, one of the issues that hung over at those meetings was the level of cooperation taking place between the new Peña Nieto administration and the U.S. over security. What’s the status of that? Has the Peña Nieto administration made inroads on the security issue to the satisfaction of the U.S.? What’s the U.S. view of security?
MR. RHODES: We have maintained our security cooperation with Mexico. We are very pleased with the level of cooperation that we have with the Mexican government in addressing the narcotrafficking issue. President Peña Nieto is focused on reducing the levels of violence, broadly. We continue to provide whatever support the Mexican government asks us for and requires as they deal with huge border security -- huge issues of violence around the border, and because of the narcotrafficking issue. At the same time, we’ve continued to make clear our own responsibilities to crack down, for instance, on the flow of guns southward, which has been an element of the violence there.
So the cooperation has continued. It’s certainly been good from our perspective, and I’m sure that they’ll address it in their bilateral meeting, as well as in the trilat.
MR. CARNEY: Can I just say, since nobody asked -- hey, Christi, did you have a question?
Q No.
MR. CARNEY: Well, so a couple of things have happened this week related to the President’s primary focus on growing the economy and expanding opportunity that are rather remarkable. First of all, you see Republicans lining up en masse against raising the minimum wage, which is a remarkable development if you think about it. You have Americans across the country working full-time and yet being paid a wage that keeps them in poverty. That’s not something that should happen in this country. And the American people, including Republicans’ constituents, overwhelmingly support lifting the minimum wage. As the CBO report demonstrated, that would lift something on the order of 900,000 Americans out of poverty and raise the wages for 16 million-plus Americans across the country. And as Jason Furman said, the substantial consensus among economists is that it would not have a negative impact on jobs.
The second thing that happened was the five-year anniversary of the Recovery Act. And as a point of personal privilege as somebody who was covering these matters back in the early ‘90s, I find it remarkable that Speaker Boehner attacks the President for the Recovery Act. I remember when Speaker Boehner powerfully argued against President Clinton’s economic agenda, said that it would lead to stagnation and job loss. He could not have been more wrong then. We saw record job creation. Speaker Boehner was wrong.
Speaker Boehner argued powerfully against the Recovery Act and President Obama’s economic agenda. In the wake of the worst recession since the Great Depression, we've seen the creation of 8.5 million private sector jobs. Speaker Boehner could not have been more wrong. In between, Speaker Boehner supported economic policies that helped to precipitate the worst financial crisis and economic crisis in our lifetimes and, by the way, led to record deficits, which were handed over to President Obama when he took office.
It's very important to have the long view here. And what we know about the Recovery Act is that it delivered tax cuts, it delivered investments in clean energy, it delivered an infusion in an economy that was teetering on the brink of collapse. And the alternative at the time, as you remember if you saw the headlines, was the potential for depression, some predicting 20 to 25 percent unemployment. Republicans refused to support a plan that saved the country from that kind of disaster and set us on the course towards job creation and economic growth.
This is not a project that's anywhere near done. That's why the President remains focused principally on growing the economy, helping the middle class. And certainly raising the minimum wage is a way to do that.
Q Jay, since you brought it up, on the CBO, it’s been remarkable cherry-picking of the results of the conclusions of that report by both sides. How can it be that those economists can be right on one issue from your side, the raising people out of poverty, but so wrong on the job costs of that report? And is there a danger in going after what is usually considered a fairly neutral arbiter of economic issues and budget issues?
MR. CARNEY: Jim, we're not going after anyone. As Jason Furman, the President’s chief economist, said yesterday, we respectfully disagree with that particular conclusion and point to the deep and wide body of academic research on this that supports our view. But it’s not about -- obviously we have enormous respect for the CBO, and I think that’s reflected in the fact that we point to some of the other conclusions in that report.
It’s just demonstrated by history and, again, by the work of many experts in the field that there’s likely to have no negative impact in terms of job creation by raising the minimum wage, which spurs economic activity, lifts people out of poverty, and raises the wages for Americans across the country, including middle-class Americans. But again, that’s a respectful disagreement on a particular finding in which the experts in the field have expressed a different view.
Q But you must have felt that that report was damaging to your efforts to get support for raising the minimum wage.
MR. CARNEY: Look, I think that Republicans who, against the overwhelming opinion of the American people, rally around that particular item in the report to suggest that we can’t give Americans a raise risk more damage to themselves and politically, as well as to the middle class economically, and to Americans economically.
So I don’t think we view it that way. Support for raising the minimum wage is broad and deep. We’ve seen states take action, and we’re going to continue to press the Congress to take action.
Thank you.
END
REMARKS: SECRETARY OF STATE KERRY AND FRENCH FOREIGN MINISTER FABIUS
FROM: U.S. STATE DEPARTMENT
Remarks With French Foreign Minister Laurent Fabius Before Their Meeting
Remarks
John Kerry
Secretary of State
Quai d'Orsay
Paris, France
February 19, 2014
SECRETARY KERRY: Hello, everybody. First of all, let me say I’m very happy to be back visiting with Foreign Minister Fabius so soon after his visit to Washington. And we all appreciated the state visit, and we’re still feeling positive results of that meeting, which was very, very productive for all of us.
I wanted to say a word about the situation in Ukraine. All of us are deeply disturbed by the scenes of the violence, by the level of abuse that the citizens in the streets have felt over the course of the last days. And our hearts go out to the people of Ukraine for what has been happening.
President Yanukovych has the opportunity to make a choice. The choice is between protecting the people that he serves, all of the people, and a choice for a compromise and dialogue versus violence and mayhem. We believe the choice is clear, and we are talking about the possibility of sanctions or other steps with our friends in Europe and elsewhere in order to try to create the environment for compromise.
Our desire is for Mr. Yanukovych to bring people together, dialogue with the opposition, find the measure of compromise, and put the broad interests of the people of Ukraine out front. We are convinced there is still space for that to happen. The violence can be avoided, and in the end, the aspirations of the people of Ukraine can be met through that kind of dialogue. That is our hope. Vice President Biden talked yesterday, I believe even today again, with President Yanukovych. But really it’s in his hands to decide what the future of Ukraine and the future hopes of his people will be. And we hope very, very much that violence will be avoided and compromise will be found.
FOREIGN MINISTER FABIUS: (In French.)
SECRETARY KERRY: (Inaudible.) Tomorrow the foreign minister will be leaving to join with the German foreign minister and the Polish foreign minister in Kyiv, where they will gather the latest information regarding the situation on the ground. And then they will go to Brussels, where they will have a meeting in order to discuss the possibility of sanctions or whatever steps might be appropriate.
FOREIGN MINISTER FABIUS: We shall meet tomorrow morning, the different element, the different actors, in Kyiv. And stemming from that, we shall encourage them to find a way of dialogue. And stemming from that, we should be back in Brussels to take the decisions which are necessary.
SECRETARY KERRY: Thank you all very much. Thank you.
Remarks With French Foreign Minister Laurent Fabius Before Their Meeting
Remarks
John Kerry
Secretary of State
Quai d'Orsay
Paris, France
February 19, 2014
SECRETARY KERRY: Hello, everybody. First of all, let me say I’m very happy to be back visiting with Foreign Minister Fabius so soon after his visit to Washington. And we all appreciated the state visit, and we’re still feeling positive results of that meeting, which was very, very productive for all of us.
I wanted to say a word about the situation in Ukraine. All of us are deeply disturbed by the scenes of the violence, by the level of abuse that the citizens in the streets have felt over the course of the last days. And our hearts go out to the people of Ukraine for what has been happening.
President Yanukovych has the opportunity to make a choice. The choice is between protecting the people that he serves, all of the people, and a choice for a compromise and dialogue versus violence and mayhem. We believe the choice is clear, and we are talking about the possibility of sanctions or other steps with our friends in Europe and elsewhere in order to try to create the environment for compromise.
Our desire is for Mr. Yanukovych to bring people together, dialogue with the opposition, find the measure of compromise, and put the broad interests of the people of Ukraine out front. We are convinced there is still space for that to happen. The violence can be avoided, and in the end, the aspirations of the people of Ukraine can be met through that kind of dialogue. That is our hope. Vice President Biden talked yesterday, I believe even today again, with President Yanukovych. But really it’s in his hands to decide what the future of Ukraine and the future hopes of his people will be. And we hope very, very much that violence will be avoided and compromise will be found.
FOREIGN MINISTER FABIUS: (In French.)
SECRETARY KERRY: (Inaudible.) Tomorrow the foreign minister will be leaving to join with the German foreign minister and the Polish foreign minister in Kyiv, where they will gather the latest information regarding the situation on the ground. And then they will go to Brussels, where they will have a meeting in order to discuss the possibility of sanctions or whatever steps might be appropriate.
FOREIGN MINISTER FABIUS: We shall meet tomorrow morning, the different element, the different actors, in Kyiv. And stemming from that, we shall encourage them to find a way of dialogue. And stemming from that, we should be back in Brussels to take the decisions which are necessary.
SECRETARY KERRY: Thank you all very much. Thank you.
REMARKS: SECRETARY KERRY AND JORDANIAN FOREIGN MINISTER JUDEH
FROM: U.S. STATE DEPARTMENT
Remarks With Jordanian Foreign Minister Judeh Before Their Meeting
Remarks
John Kerry
Secretary of State
Paris, France
February 19, 2014
SECRETARY KERRY: It’s great to be able to visit with Foreign Minister Judeh, who has been a tremendous partner in so many efforts with respect to Syria, with respect to the Middle East as a whole, and particularly we are listening very carefully to our friends in Jordan regarding the Middle East peace process. His Majesty King Abdullah just had a very good meeting with President Obama in California. We are discussing a number of ongoing security issues regarding the relationship, and we’re particularly grateful to the role that Jordan has played with respect to the Syrian refugees. It’s an extraordinary burden.
We’re proud that we’re the number one donor to this crisis, but both of us want to stop having increased clients. We want an end to the refugee crisis, an end to the problem of Syria, and we’re working hard to find ways forward on that. Thanks for visiting.
FOREIGN MINISTER JUDEH: Thank you very much, Mr. Secretary, and as my good friend the Secretary of State said, I am here in the wake of an extremely successful visit by His Majesty the King to the United States. His Majesty just returned to Jordan yesterday – an extremely successful meeting with President Obama in Sunnylands, California, and His Majesty had the chance to receive the Secretary of State in Washington, D.C. before that. Excellent discussions. We are not just friends. We keep reminding the world we’re not just friends, we are true partners.
And it is in this spirit that we meet here today, first of all to build on the very productive discussions that His Majesty had with American Administration officials and Congress and different friends, but also to keep in touch and to coordinate closely. This is the nature of our relationship. The political consultation is constant and intensive and ongoing, particularly at this juncture. His Majesty the King is always very careful to point to the diligent efforts that Secretary Kerry, on behalf of President Obama and the Administration, is conducting when it comes to Middle East peacemaking. He has visited the region a number of times only in this last year and engaged with the leaders.
And when it comes to Middle East peace, and peace between Palestinians and Israelis in particular, we are always also careful to point to the Jordanian national interest, and Jordan is a stakeholder, not just a mediator or observer. All final status issues touch the very heart of Jordanian interests and (inaudible). And therefore, we are as interested as anyone out there in having this result in a fruitful outcome, and we salute the efforts of the Secretary of State on this front.
We are also extremely grateful for his constant care to keep us updated at every juncture and with each development in that regard, and we also want to build on the discussions that took place between His Majesty and the President and the Secretary of State when it comes to the challenge of Syria. And as the Secretary pointed out, we are at the receiving end of a huge humanitarian spillover, with 600,000 refugees plus 700,000 economic migrants before that – 1.3 million Syrian nationals on our soil – and the huge challenge that that represents to our infrastructure and to many of our key sectors.
So I look forward to, as always, an excellent discussion with the Secretary of State and to coordinate closely and to keep each other informed. So I thank you for this opportunity.
SECRETARY KERRY: Thanks, Nasser.
Remarks With Jordanian Foreign Minister Judeh Before Their Meeting
Remarks
John Kerry
Secretary of State
Paris, France
February 19, 2014
SECRETARY KERRY: It’s great to be able to visit with Foreign Minister Judeh, who has been a tremendous partner in so many efforts with respect to Syria, with respect to the Middle East as a whole, and particularly we are listening very carefully to our friends in Jordan regarding the Middle East peace process. His Majesty King Abdullah just had a very good meeting with President Obama in California. We are discussing a number of ongoing security issues regarding the relationship, and we’re particularly grateful to the role that Jordan has played with respect to the Syrian refugees. It’s an extraordinary burden.
We’re proud that we’re the number one donor to this crisis, but both of us want to stop having increased clients. We want an end to the refugee crisis, an end to the problem of Syria, and we’re working hard to find ways forward on that. Thanks for visiting.
FOREIGN MINISTER JUDEH: Thank you very much, Mr. Secretary, and as my good friend the Secretary of State said, I am here in the wake of an extremely successful visit by His Majesty the King to the United States. His Majesty just returned to Jordan yesterday – an extremely successful meeting with President Obama in Sunnylands, California, and His Majesty had the chance to receive the Secretary of State in Washington, D.C. before that. Excellent discussions. We are not just friends. We keep reminding the world we’re not just friends, we are true partners.
And it is in this spirit that we meet here today, first of all to build on the very productive discussions that His Majesty had with American Administration officials and Congress and different friends, but also to keep in touch and to coordinate closely. This is the nature of our relationship. The political consultation is constant and intensive and ongoing, particularly at this juncture. His Majesty the King is always very careful to point to the diligent efforts that Secretary Kerry, on behalf of President Obama and the Administration, is conducting when it comes to Middle East peacemaking. He has visited the region a number of times only in this last year and engaged with the leaders.
And when it comes to Middle East peace, and peace between Palestinians and Israelis in particular, we are always also careful to point to the Jordanian national interest, and Jordan is a stakeholder, not just a mediator or observer. All final status issues touch the very heart of Jordanian interests and (inaudible). And therefore, we are as interested as anyone out there in having this result in a fruitful outcome, and we salute the efforts of the Secretary of State on this front.
We are also extremely grateful for his constant care to keep us updated at every juncture and with each development in that regard, and we also want to build on the discussions that took place between His Majesty and the President and the Secretary of State when it comes to the challenge of Syria. And as the Secretary pointed out, we are at the receiving end of a huge humanitarian spillover, with 600,000 refugees plus 700,000 economic migrants before that – 1.3 million Syrian nationals on our soil – and the huge challenge that that represents to our infrastructure and to many of our key sectors.
So I look forward to, as always, an excellent discussion with the Secretary of State and to coordinate closely and to keep each other informed. So I thank you for this opportunity.
SECRETARY KERRY: Thanks, Nasser.
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