Wall Street ends down sharply after Fed minutes
Label: Business
At War Blog: General Allen's Tenure in Afghanistan
Label: WorldMost Americans probably know of him only as a secondary character in the sweeping drama of David H. Petraeus’s affair with his biographer, Paula Broadwell. But Gen. John R. Allen, who announced Tuesday that he would retire from the Marine Corps rather than become the top commander of NATO, was for more than a year and a half the commander of NATO forces in Afghanistan. And when he said farewell to the job recently, he made clear that he wanted to be remembered for more than his bit role in that scandal.
After receiving a medal for his service, just before turning over his command to a fellow Marine, Gen. Joseph Dunford, General Allen surprised some in the audience by declaring unequivocally: “This campaign is successful. We are winning. We are winning.”
During a news conference with a small group of reporters later, General Allen expanded on his confident description of the war – one, polls suggest, that is not shared by many Americans.
“There is no, in the Napoleonic sense, there is no decisive battle,” he said. But he said he saw daily evidence that the Afghan National Security Forces, or A.N.S.F., were getting better. “I see it contributing to the end state, which ultimately is the A.N.S.F. moving into the lead and creating space ultimately for the government of Afghanistan to get up on its feet,” he said.
“We’re not done,” he added. “But I’m comfortable that the trajectory is moving us in the direction we ultimately want to go.”
Asked if widespread corruption by the Afghan government had irreparably undermined its credibility with the people and pushed them toward the Taliban, General Allen acknowledged concerns.
“I think we all have to recognize the limits of the capacity of the Afghan people and the government at this particular moment,” he said. “We’re coming out of 33 years of conflict. Coming out of an environment where the school system was largely decimated or devastated, whichever D-word you want to apply to it.”
The key to the government’s continued stability – and to an international willingness to continue providing it aid – will be its ability to hold a safe and credible presidential election in 2014, General Allen said.
“We’ve reached the point where the rhetoric, while it was encouraging, isn’t enough anymore,” he said. “The rhetoric has to be accompanied by action. The rhetoric has to be accompanied by real and meaningful reform. Reform that reduces the capacity of the criminal patronage networks to grip and weaken institutions of state. Reform that genuinely takes care of the rights of minorities, and particularly the rights of women.”
During his tenure, General Allen had more than his share of crises: a video of Marines urinating on Taliban corpses; the burning of Korans by American soldiers; civilian deaths in allied airstrikes; the massacre of 16 civilians, in which an American soldier has been charged; and a spate of insider attacks by Afghan forces on NATO troops.
He also had to work hard to repair frayed relationships with President Hamid Karzai, who clashed openly with Mr. Petraeus, General Allen’s predecessor as head of international forces in Afghanistan. As The Times’s Matthew Rosenberg noted in a recent article, General Allen established an amicable enough relationship that Mr. Karzai called him to offer condolences while the general was on home leave in Virginia last year for his mother’s funeral.
As Mr. Rosenberg tells it, General Allen had not told anyone in the Afghan government before flying home to bury her. Then, while eating with his family in the Shenandoah Valley, he got a phone call from President Karzai.
“So I’m in the parking lot, it’s just surreal,” General Allen said. “Talking to the president of Afghanistan, who is gripped with emotion saying words to the effect that our mothers are so precious to us.”
A transcript of the interview that accompanied that article, in which General Allen described how he dealt with the Koran burnings, the Panjwai massacre and other crises, can be found here.
As if juggling all that were not enough, General Allen’s reputation came under a cloud when e-mails between him and a socialite in Tampa, Fla., Jill Kelley, emerged during the investigation of General Petraeus’s affair with Ms. Broadwell. After a lengthy review of those e-mails, the Defense Department’s inspector general cleared General Allen of any wrongdoing. The decision allowed President Obama’s nomination of General Allen to become the top NATO commander and head of the United States European Command to proceed.
But during his farewell at his headquarters in Kabul on Feb. 10, General Allen sent what might have been a signal about his plans to retire. He closed his remarks with generous praise of his wife, noting that many generations of her family had served in the military and that she had patiently endured 29 moves with him during 35 years of marriage. General Allen told The Washington Post that he was retiring to help his wife, Kathy, cope with chronic health problems.
Mindy McCready 'Really Loved Her Dog'
Label: Lifestyle
People Pets
02/19/2013 at 03:45 PM EST
But a source close to the star tells Fox News that her decision to end the animal's life would "not have been an act of malice."
"Mindy really loved her dog," the friend said. "It would have been more of a case where she just didn't want to leave the dog alone."
The troubled star, whose boyfriend, David Wilson, died of a self-inflicted gunshot wound in January, was reportedly under investigation at the time of her death. Police were concerned about details surrounding Wilson's passing.
Costlier robotic surgery soars for hysterectomies
Label: HealthCHICAGO (AP) — Robotic surgery is increasingly being used for women's hysterectomies, adding at least $2,000 to the cost without offering much benefit over less high-tech methods, a study found.
The technique was used in just 0.5 percent of operations studied in 2007, but that soared to almost 10 percent by early 2010. Columbia University researchers analyzed data on more than 260,000 women who had their wombs removed at 441 U.S. hospitals for reasons other than cancer. The database covered surgeries performed through the first few months of 2010.
Women who had the robotic operations were slightly less likely to spend more than two days in the hospital, but hospital stays were shorter than that for most women. Also, complications were equally rare among robotic surgery patients and those who had more conventional surgeries. Average costs for robotic hysterectomies totaled nearly $9,000, versus about $3,000 for the least expensive method, a different type of minimally invasive technique using more conventional surgery methods.
Traditionally hysterectomies were done by removing the womb through a large abdominal incision. Newer methods include removing the uterus through the vagina and minimally invasive "keyhole" abdominal operations using more conventional surgery methods, or surgeon-controlled robotic devices.
Robotic operations involve computer-controlled long, thin robot-like "arms" equipped with tiny surgery instruments. Surgeons operate the computer and can see inside the body on the computer screen, through a tiny camera attached to the robotic arms. The initial idea was for surgeons to do these operations miles away from the operating room, but robotic operations now are mostly done with the surgeon in the same room as the patient.
Theoretically, robotic surgeries make it easier to maneuver inside the patient, and are increasingly used for many types of operations, not just hysterectomies.
The main explanation for the big increase "is that robotic surgery has been marketed extensively to not only hospitals and physicians, but also directly to patients. There is minimal data in gynecology that it is advantageous," said Dr. Jason Wright, an assistant professor of women's health and the study's lead author.
The study was published Tuesday in the Journal of the American Medical Association.
"Our findings highlight the importance of developing rational strategies to implement new surgical technologies," the researchers wrote.
They note that 1 in 9 U.S. women will undergo a hysterectomy, usually after the age of 40. Reasons include fibroids and other non-cancerous growths, abnormal bleeding, and cancer.
Traditional abdominal operations remain common and more than 40 percent of women studied had them, costing on average about $6,600.
A JAMA editorial says the study doesn't answer whether the robotic method might be better for certain women, and says more research comparing methods is needed. Still, it says doctors and hospitals have a duty to inform patients about costs of different surgery options.
Dr. Myriam Curet of manufacturer Intuitive Surgical of Sunnyvale, Calif., said surgical robots can help surgeons overcome the limitations of other minimally invasive methods for very overweight patients, those with scarring from other surgeries and other complexities.
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JAMA: http://www.jama.ama-assn.org
Robotic surgery: http://tinyurl.com/byuljds
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AP Medical Writer Lindsey Tanner can be reached at http://www.twitter.com/LindseyTanner
M&A deals lift Wall Street shares nearer a record high
Label: BusinessNEW YORK (Reuters) - U.S. stocks rose on Tuesday as this year's ongoing surge in merger activity suggested investors were still finding value in the market even as indexes closed in on all-time highs.
Office Depot Inc
News of the potential move came just days after Berkshire Hathaway
Deal activity has helped equities resist a pullback as investors use dips in stocks as buying opportunities. The S&P is up about 7 percent so far in 2013 and has climbed for the past seven weeks in its longest weekly winning streak since January 2011, though most of the weekly gains have been slim.
The Dow industrials closed 0.9 percent away from their record high while S&P 500 was 2.2 percent off its peak.
"Deals are good for the market," said Frank Lesh, a futures analyst and broker at FuturePath Trading LLC in Chicago. "The fact that they're being done is a positive."
More than $158 billion in deals has been announced so far in 2013, more than double the activity in the same period last year and accounting for 57 percent of global deal volumes, according to Thomson Reuters Deals Intelligence.
The Dow Jones industrial average <.dji> gained 53.91 points, or 0.39 percent, to 14,035.67. The Standard & Poor's 500 Index <.spx> gained 11.15 points, or 0.73 percent, to 1,530.94. The Nasdaq Composite Index <.ixic> gained 21.56 points, or 0.68 percent, to 3,213.59.
Other stocks in the office supplies sector also rose. Larger rival Staples Inc
"Equity investors have to be encouraged by M&A since, if the number crunchers are offering large premiums, that shows how much value is still in the market," said Mike Gibbs, co-head of the equity advisory group at Raymond James in Memphis, Tennessee.
On the downside, health insurance stocks tumbled, led by a 6.4 percent drop in Humana Inc
UnitedHealth Group
Wall Street's strong start to the year was fueled by better-than-expected corporate earnings, as well as a compromise in Washington that temporarily averted automatic spending cuts and tax hikes that are predicted to damage the economy.
The compromise on across-the-board spending cuts postponed the matter until March 1, at which point the cuts take effect. Ahead of the debate over the cuts, known as sequestration, further gains for stocks may be difficult to come by.
Some investors say the debate could be the catalyst for a long anticipated sell-off after the market's recent strong run.
Carter Worth, a technical analyst at Oppenheimer, pointed to the "especially complacent action of the past six weeks," noting that, as of Friday, stocks have gone 33 sessions without a dip of more than 1.5 percent.
"We would be selling aggressively into the market's current strength," he said in a research note.
Economic data showed the NAHB/Wells Fargo Housing Market index unexpectedly edged down to 46 in February from 47 in the prior month as builders faced higher material costs.
According to the Thomson Reuters data through Monday morning, of the 391 companies in the S&P 500 that have reported results, 70.1 percent have exceeded analysts' expectations, compared with a 62 percent average since 1994 and 65 percent over the past four quarters.
Fourth-quarter earnings for S&P 500 companies have risen 5.6 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.
Express Scripts
About two stocks rose for everyone that fell on the New York Stock Exchange and Nasdaq. About 6.48 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, in line with the daily average so far this year.
(Additional reporting by Chuck Mikolajczak Ryan Vlastelica and Rodrigo Campos; Editing by Chizu Nomiyama, Kenneth Barry and Nick Zieminski)
Mikhail Pakhomov’s Body Is Found Near Moscow in Cement-Filled Barrel
Label: World
MOSCOW — The body of a missing city legislator and construction tycoon has been found in a private basement garage on the city’s outskirts, inside a rusted metal barrel filled with cement, the police said Monday.
Russian television showed investigators removing the body of the man, Mikhail Pakhomov, 36, on Sunday evening from the garage, 20 miles east of Moscow, where the police said he had been tortured and killed over an outstanding $80 million loan.
The killing recalled the brutal violence that routinely emerged from business disputes in the 1990s. Mr. Pakhomov, who was reported missing last Tuesday, was a promising young star in United Russia, the ruling party founded by President Vladimir V. Putin, and had served as head of a construction company that was reported to have won large contracts to develop utilities and infrastructure in several cities.
Sergei B. Ivanov, Mr. Putin’s chief of staff, last year called housing and utilities services one of Russia’s most corrupt sectors. Many lucrative contracts are doled out on the municipal level, and large sums of money are at stake.
Politicians who have tried to battle graft in the system have met with violence. In 2011, Yevgeny Dushko, the mayor of Sergiyev Posad, was gunned down in his driveway in a contract killing that investigators said was most likely linked to his disputes with the city’s utility contractors.
The police have identified the likely mastermind of Mr. Pakhomov’s killing as Yevgeny Kharitonov, a former deputy minister for housing and utilities services in the Moscow region. . They said Mr. Kharitonov had Mr. Pakhomov followed since last November and was pressing the legislator to repay a debt of $80 million. Mr. Kharitonov has been arrested, but so far, he has been charged only with kidnapping. Seven other people were also arrested.
Mr. Pakhomov was reported missing on Feb. 12 from Lipetsk, an industrial city 270 miles southeast of Moscow, where he served as a regional lawmaker. Witnesses said three men had dragged him from his car, and the police said they found traces of blood at the scene.
The search continued for almost a week, until people questioned by the police led investigators to the body.
“A similar event has never happened with a V.I.P. in our city,” read an editorial published in Gorod48, a news Web site based in Lipetsk. “Even in the ‘evil ’90s’ nobody disappeared: businessmen were killed right where they lived or worked, and bandits from competing groups shot or blew each other up wherever they happened to be.”
The Bachelor: AshLee Dishes on Her Connection with Sean - and Tierra
Label: Lifestyle
TV Watch
The Bachelor
By Carrie Bell
02/18/2013 at 04:25 PM EST
Why wait so long to tell him about your high school marriage?
Obviously, I wasn't going to tell him on our very first date. I want to know somebody and make sure the vibe is there before I divulge my story. Every other time was either a group date or the rose ceremony and that just wasn't the appropriate time to talk. He had a few more questions about it [than aired on TV], but he was so loving and genuine about it. He made me feel like a huge weight lifted, like it was OK.
Can you explain how it ended?
The details are pretty simple. I got a divorce. I was young and I didn't handle [going through the rough patch with my family] the best way. It wasn't a bad breakup. It was more like I woke up and [realized], "Oops. What did I do?" We discussed it and both came to the conclusion that we made a bad decision.
You had a great date and said, "I love you." Yet you seemed convinced you would be eliminated. Why?
One hundred percent I was scared this might be the time I go home. I felt safe up until the argument happened and even until Sean came in before the rose ceremony and said that he didn't want anyone with these dramatic spells in his life. I was part of the [drama with Tierra]. I didn't get a chance to talk to him and explain my side of it because there was no cocktail party.
How'd it feel to hear Tierra mock your age and call you high school?
I laughed because what are you gonna do? Go back in time? I'm 32. I've never thought about my age so much in my life. It doesn't bother me. It speaks for itself who was being immature. It was not a very nice thing to say, but that's the difference between her character and mine.
Ever wonder how he could dig Tierra and you simultaneously?
I couldn't sit and wonder why he was keeping Tierra. You have to compartmentalize your feelings and focus on the end and your relationship with Sean. Sean is smart. I knew he'd eventually come to and realize it.
Why do you two mesh?
We come from the same background, have a very similar strong family upbringing and are compatible. He was classy, charismatic and a solid gentleman who made me laugh all the time. You have to balance each other out. I think it was a ying to a yang. He wants to adopt and [great for] my heart to hear. That's a solid foundation to build a perfect relationship.
People have said you might not be enough of a goofball to be the one.
When it came to our relationship. I took it more seriously because this is my future. This is marriage and that's not something I want to tread into lightly. But for the most part, I'm not sure where that comes from. I joked. I laughed. I played a lot of Apples to Apples. I had a blast.
Do you see connections between him and other girls?
I see the possibility. Lindsay is very fun. She's always cracking jokes. Catherine has a big heart. Desiree has a sense of stability. Sean said he wanted someone that was genuine, nice, ready for marriage and somebody with a good heart who loved family and if that's what he wanted, I'm the best match for that.
Is everyone left ready to get married?
If they say they are, I would take it at face value. I would hope that anybody who comes on the show is ready. I can only vouch for myself. I was 100 percent ready to give my heart to somebody and fall in love.
Study: Better TV might improve kids' behavior
Label: HealthSEATTLE (AP) — Teaching parents to switch channels from violent shows to educational TV can improve preschoolers' behavior, even without getting them to watch less, a study found.
The results were modest and faded over time, but may hold promise for finding ways to help young children avoid aggressive, violent behavior, the study authors and other doctors said.
"It's not just about turning off the television. It's about changing the channel. What children watch is as important as how much they watch," said lead author Dr. Dimitri Christakis, a pediatrician and researcher at Seattle Children's Research Institute.
The research was to be published online Monday by the journal Pediatrics.
The study involved 565 Seattle parents, who periodically filled out TV-watching diaries and questionnaires measuring their child's behavior.
Half were coached for six months on getting their 3-to-5-year-old kids to watch shows like "Sesame Street" and "Dora the Explorer" rather than more violent programs like "Power Rangers." The results were compared with kids whose parents who got advice on healthy eating instead.
At six months, children in both groups showed improved behavior, but there was a little bit more improvement in the group that was coached on their TV watching.
By one year, there was no meaningful difference between the two groups overall. Low-income boys appeared to get the most short-term benefit.
"That's important because they are at the greatest risk, both for being perpetrators of aggression in real life, but also being victims of aggression," Christakis said.
The study has some flaws. The parents weren't told the purpose of the study, but the authors concede they probably figured it out and that might have affected the results.
Before the study, the children averaged about 1½ hours of TV, video and computer game watching a day, with violent content making up about a quarter of that time. By the end of the study, that increased by up to 10 minutes. Those in the TV coaching group increased their time with positive shows; the healthy eating group watched more violent TV.
Nancy Jensen, who took part with her now 6-year-old daughter, said the study was a wake-up call.
"I didn't realize how much Elizabeth was watching and how much she was watching on her own," she said.
Jensen said her daughter's behavior improved after making changes, and she continues to control what Elizabeth and her 2-year-old brother, Joe, watch. She also decided to replace most of Elizabeth's TV time with games, art and outdoor fun.
During a recent visit to their Seattle home, the children seemed more interested in playing with blocks and running around outside than watching TV.
Another researcher who was not involved in this study but also focuses his work on kids and television commended Christakis for taking a look at the influence of positive TV programs, instead of focusing on the impact of violent TV.
"I think it's fabulous that people are looking on the positive side. Because no one's going to stop watching TV, we have to have viable alternatives for kids," said Dr. Michael Rich, director of the Center on Media and Child Health at Children's Hospital Boston.
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Online:
Pediatrics: http://www.pediatrics.org
___
Contact AP Writer Donna Blankinship through Twitter (at)dgblankinship
Yen resumes fall after G20, U.S. holiday thins trade
Label: BusinessLONDON (Reuters) - The yen resumed falling on Monday after Japan signaled it would push ahead with expansionist monetary policies having escaped criticism from the world's 20 biggest economies at the weekend.
Industrial metals also dipped and European shares were soft on lingering worries about the economic outlook, especially for the euro zone. While the risk of an inconclusive outcome in Italy's forthcoming election added to investor concerns.
However, activity was curtailed by the closure of markets in the United States for the Presidents' Day holiday.
The yen, which has dropped 20 percent against the dollar since mid-November, fell further after financial leaders from the G20 promised not to devalue their currencies to boost exports and avoided singling out Japan for any direct criticism.
The dollar rose 0.5 percent to 93.95 yen, near a 33-month peak of 94.47 yen set a week ago. The euro added 0.3 percent to 125.40 yen, to be midway between Friday's two-week low of 122.90 and a 34-month high of 127.71 yen hit earlier this month.
Strategists said the yen was likely to stay weak, though its decline could lose momentum until it becomes clear who will be taking the helm at the Bank of Japan when the current governor steps down on March 19.
"The yen probably will weaken a little further in anticipation of more aggressive easing under a new leadership team at the Bank of Japan," said Julian Jessop, chief global economist at Capital Economics.
Japan's Prime Minister Shinzo Abe is poised to nominate the new governor in the next few days. Sources have told Reuters that former financial bureaucrat Toshiro Muto, considered likely to be less radical than other candidates, was leading the field.
Meanwhile the euro dipped slightly against the dollar when European Central Bank president Mario Draghi said the currency's recent gains made any rise in inflation less likely and added that he had yet to see any improvement in the euro zone economy.
Speaking before the European Parliament, Draghi said the euro's exchange rate was not a policy target but was important for growth and stability, adding that appreciation of the euro "is a risk".
The comments left the euro down 0.2 percent at $1.3334.
Elsewhere in the currency market, sterling hit a seven-month low against the dollar, after a key policymaker made comments about the need for further weakness and recent poor data which has kept alive worries of another British recession.
Sterling fell 0.25 percent to $1.5476 having earlier touched $1.5438, its lowest since July 13.
DATA LOOMS
A big week for data on the outlook for the world's economy weighed on other riskier asset markets following the recent dire fourth-quarter growth numbers for the euro zone and Japan, along with Friday's soft U.S. manufacturing figures.
In European markets, attention is focused on the euro area Purchasing Managers' Indexes for February and German sentiment indices due later in the week which could affect hopes for a recovery this year.
Analysts expect Thursday's euro area flash PMI indices, which offer pointers to economic activity around six months out, to show growth stabilizing across the recession-hit region, leaving intact hopes for a recovery in the second half of 2013.
Concerns over an inconclusive outcome in the Italian election on Sunday and Monday have added to the weaker sentiment as a fragmented parliament could hamper a future government's efforts to reform the struggling economy.
The worries about the outlook for Italy were encouraging investors back into safe-haven German government bonds on Monday, with 10-year Bund yields easing 3.5 basis points to be around 1.63 percent.
"Political uncertainty will keep Bunds well bid this week," ING rate strategist Alessandro Giansanti said, adding that only better than expected economic data could create selling pressure on German debt in the near term.
Italian 10-year yields were 4 basis points higher on the day at 4.41 percent.
EARNINGS HIT
European equity markets were taking their lead from corporate earnings reports which have been reflecting the sluggish economic conditions across the region.
Danish brewer Carlsberg
The 5.8-percent drop for shares in the world's fourth biggest brewery helped send the FTSEurofirst 300 index <.fteu3> of top European shares down 0.2 percent. Germany's DAX <.gdaxi>, France's CAC-40 <.fchi> and Britain's FTSE-100 <.ftse> ranged between 0.4 percent up and 0.15 percent lower.
Earlier, the G20 statement and subsequent comment from Prime Minster Abe indicating a renewed drive to stimulate the Japanese economy lifted the Nikkei stock index <.n225> by 2.1 percent, near to its highest level since September 2008.
MSCI's world equity index <.miwd00000pus> was flat as markets extended a two-week period of consolidation that has followed the big run-up in January, when demand was buoyed by the efforts of central banks to stimulate the world economy.
Data from EPFR Global, a U.S.-based firm that tracks the flows and allocations of funds globally, shows investors pulled $3.62 billion from U.S. stock funds in the latest week, the most in 10 weeks after taking a neutral stance the prior week.
But demand for emerging market equities remained strong, with investors putting $1.81 billion in new cash into stock funds, the fund-tracking firm said.
CHINA RETURN
In the commodity markets, traders played catch-up after a week-long holiday last week in China, the world's second biggest consumer of many raw materials, which had kept activity subdued, with worries about the economic outlook weighing on sentiment.
Copper, for which China is the world's largest consumer, dipped to a near three-week low at $8,125.25 a metric ton (1.1023 tons) on the London futures market. Benchmark tin and nickel also touched three-week lows.
Gold managed to edge away from six-month lows as jewelers in China returned to the physical market after the Lunar New Year holiday but a lack of demand from U.S. markets saw the precious metal slip back to be down 0.1 percent to $1,607.06 an ounce.
Crude oil markets were mostly steady after the weak U.S. industrial production data on Friday [ID:nL1N0BF44A] was seen dampening demand, while tensions in the Middle East lent some support.
"We continue to see a mixed picture out of the United States. Industry output was lower than expected but that shouldn't affect the general upward direction," Olivier Jakob, analyst at Geneva-based Petromatrix, said.
Brent crude was down 20 cents at $117.46 a barrel after posting its first weekly loss since the first half of January. U.S. crude slipped 24 cents to $95.62.
(Additional reporting by Marius Zaharia and Ron Bousso; Editing by Philippa Fletcher and Alastair Macdonald)
IHT Rendezvous: Taming the Runaway U.S. Budget
Label: WorldWASHINGTON — If Democrats and Republicans can’t agree on a deficit reduction plan, in two weeks automatic budget cuts will kick in that could severely weaken the U.S. economy and the American military.
As I write in my latest Letter From Washington, there are sensible ways to avoid this, though it is far from certain dysfunctional Washington can achieve them.
One reason is that so much of spending is now hard-wired into the system.
Representative John Dingell of Michigan is the only current member of Congress who served in 1962. Yet he would hard-pressed to recall the federal budget of a half century ago.
In those days, more than two-thirds, 67.5 percent, of spending was discretionary, meaning it had had to be appropriated annually. Almost half the budget went to defense and about 18 percent went to discretionary domestic programs.
Mandatory spending, or entitlements, was only a little more than a quarter of the budget, and more than half of that went for Social Security.
That picture is turned upside down in the current fiscal year. Almost 60 percent of the budget is mandatory spending with one $1 of every $5 going to Social Security and $1 in $7 to Medicare and Medicaid. Defense is almost 19 percent, a fraction of what it was in 1962, and domestic discretionary programs, at a little more than 16 percent, takes a smaller proportional bite out of the federal budget than they did a half century ago despite the creation of so many new initiatives.
This isn’t going to change. “Regardless of who is president, what will be spent in any given year will be determined by laws that are already set, some decades earlier,” says Stan Collender, an expert on the federal budget.
Despite the large budget deficits in recent years, interest on the debt payments, at 6.5 percent this year, is almost precisely what it was a half century ago. These payments, however, are expected to climb steadily over the next 50 years. Under current projections, Mr. Collender says, they are on track to become the fastest-growing area of the federal budget.
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