A U.S. Air Force MQ-1 Predator, unmanned aerial vehicle, armed with AGM-114 Hellfire missiles, performs a low altitude pass during the Aviation Nation 2005 air show at Nellis Air Force Base, Nevada in this November 13, 2005 USAF handout photo obtained by Reuters February 6, 2013.

WASHINGTON | Fri Mar 15, 2013 4:36pm EDT

WASHINGTON (Reuters) - A federal judge twice considered by President Barack Obama for the Supreme Court has rebuked the administration over the secrecy surrounding aerial drone strikes abroad, adding to pressure Obama already faces from fellow Democrats.

A ruling on Friday from Judge Merrick Garland in Washington capped a week of mounting calls for the release of more information and follows a drawn-out confirmation process for the new director of the Central Intelligence agency, John Brennan.

The Obama administration defends the attacks as essential to the fight against al Qaeda and other militants in countries such as Pakistan and Yemen. The strikes have at times killed civilians who were not targets, ignited local anger and frayed diplomatic ties.

A Democratic senator confronted Obama about the drone program at a closed-door meeting on Tuesday, the Politico newspaper reported, and on Wednesday a lawyer who led Obama's 2008 presidential transition, John Podesta, wrote an opinion piece accusing the administration of wrongly withholding drone-related legal opinions.

Garland, writing for himself and two other judges on the Court of Appeals for the District of Columbia Circuit, criticized the Central Intelligence Agency for refusing in a lawsuit even to acknowledge the existence of its drone program. He called the CIA's legal reasoning indefensible and a fiction.

"'There comes a point where... courts should not be ignorant as judges of what (they) know as men' and women," Garland wrote, quoting a 1949 Supreme Court opinion.

"We are at that point with respect to the question of whether the CIA has any documents regarding the subject of drone strikes," he wrote.

The ruling effectively revives a lawsuit in which the American Civil Liberties Union is asking for records from the CIA. Obama administration lawyers have opposed the suit.

TRANSPARENCY DEBATE

In response to the ruling, a National Security Council spokeswoman said the administration had been more transparent than any of its predecessors on the conduct of sensitive counterterrorism operations but would not discuss details of specific operations.

Caitlin Hayden, the spokeswoman, said in a statement: "We will continue to disclose as much as we can - as soon as we can - regarding the framework, the standards, and the process through which we approve such operations."

Justice Department spokeswoman Nanda Chitre said the department was reviewing the decision, while CIA spokesman Todd Ebitz said: "The CIA does not, as a rule, comment on matters before the courts."

Attorney General Eric Holder said in congressional testimony on March 6 that Obama would soon reveal more about the legal rationale for drone strikes.

"We have talked about a need for greater transparency," said Holder, the chief U.S. law enforcement official.

Democrats outside the administration have shown growing impatience with the secrecy. West Virginia Senator Jay Rockefeller, a former Senate Intelligence Committee chairman, urged Obama to be more open during the president's meeting with Senate Democrats on Tuesday, Politico reported.

Podesta, a Democratic insider who oversaw Obama's 2008 transition, wrote in The Washington Post on Wednesday that Obama "is ignoring the system of checks and balances that has governed our country from its earliest days."

Last week, two Democratic senators voiced similar ideas in voting against confirming John Brennan as Obama's CIA director. Brennan was confirmed to the post on March 7, but the confirmation process was delayed for weeks by concerns about the administration's use of drones.

HIGH COURT CANDIDATE

Garland, 60, was a high-level Justice Department official when President Bill Clinton appointed him a judge.

He was on Obama's list of candidates for the Supreme Court when vacancies arose in 2009 and 2010. Obama chose others, but Garland remains a frequently cited judge on the influential appeals court in Washington.

In its efforts to quash the ACLU's records suit, the CIA said it could neither confirm nor deny whether it had drone records because of security concerns.

The ACLU, which sued under the 1966 Freedom of Information Act, countered that government officials had already acknowledged the drone program in public statements from 2009 to 2012.

The question became whether the statements by Obama, former CIA Director Leon Panetta and former counterterrorism adviser Brennan amounted to an official acknowledgment.

Garland ruled that they did, writing, "The president of the United States has himself publicly acknowledged that the United States uses drone strikes against al Qaeda."

However, if the case follows the pattern of similar suits, the ACLU is likely a long way from getting any records. Its suit now heads back to a trial court, where the CIA could invoke other defenses against the records request.

Jameel Jaffer, deputy legal director of the ACLU, said the ruling would make it more difficult for the government to deflect questions about drones.

"The public surely has a right to know who the government is killing, and why, and in which countries, and on whose orders," Jaffer said in a statement.

(Additional reporting by Mark Felsenthal and Tabassum Zakaria; Editing by Howard Goller and David Brunnstrom)

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1 of 4. U.S. President Barack Obama delivers remarks on energy at the Argonne National Lab near Chicago, March 15, 2013.

LEMONT, Ill./WASHINGTON | Fri Mar 15, 2013 6:39pm EDT

LEMONT, Ill./WASHINGTON (Reuters) - President Barack Obama tried to move past partisan fights over energy policy on Friday with a modest proposal to fund research into cars that run on anything but gasoline.

Obama toured the Argonne National Laboratory outside of Chicago, known for its research into advanced batteries used in electric cars, then delivered a speech highlighting the need to find more ways to wean vehicles off oil.

The United States has a newfound wealth of oil and natural gas resources made possible by hydraulic fracturing and other drilling advancements, but consumers still face high prices at the pumps because gasoline prices are tied to world markets.

"The only way to break this cycle of spiking gas prices for good is to shift our car and trucks entirely off oil," Obama said in Argonne's advanced photon facility, which says it produces the brightest source of X-rays in the Western Hemisphere, used for an array of research projects.

The Democratic president proposed a fund that will draw $2 billion over 10 years from royalties the government receives from offshore drilling in the Outer Continental Shelf.

The research would be aimed at new ways to lower the cost of vehicles that run on electricity, biofuels, natural gas or other non-oil fuel sources.

Obama first mentioned the Energy Security Trust fund in his State of the Union address last month.

The White House touted the idea as bipartisan, saying it came from retired military and business leaders, including some Republicans, who belong to a policy group called Securing America's Future Energy.

"This is not a Democratic idea or a Republican idea," Obama said, standing in front of three cars designed to run on alternative fuels. "This is just a smart idea."

But Republican approval was far from assured.

"For this proposal to even be plausible, oil and gas leasing on federal land would need to increase dramatically," said Brendan Buck, a spokesman for Republican House of Representatives Speaker John Boehner. "Unfortunately, this administration has consistently slowed, delayed, and blocked American energy production."

By choosing to focus his first energy speech on research - an issue that appeals equally to Republicans and Democrats, industry and environmental groups - Obama is seeking to build common ground on energy, which has been a divisive policy issue.

"In order for something like this to pass the Hill, it will need votes from both sides," said Michael Levi, an energy fellow at the Council on Foreign Relations. "That makes it wise for the president to start with something that Congress can work from."

IS CONGRESS WILLING?

The research trust fund will require consent from Congress, which is grappling with federal budget cuts. Senator Lisa Murkowski of Alaska, the top Republican on the Senate Energy Committee, had proposed a similar idea. But her version called for expanded drilling, which Obama's proposal does not include.

Murkowski's spokesman Robert Dillon said the president's plan relied on royalties that have already been factored into the budget, "which could mean either deficit spending or less funding for the Land and Water Conservation Fund."

"There's a better way that not only funds investment in research, but also addresses our need for affordable and abundant energy," Dillon said, referring to expanded drilling.

White House officials said the president's plan would not add to the deficit because they expect leasing revenues to grow in coming years for several reasons, including changes the administration plans to make to leasing policy.

White House spokesman Josh Earnest said the administration is willing to work with Congress on the research fund plan.

"If there are different ideas people want to offer up, we'll certainly have a conversation with them about that," he said.

Mark Kennedy, the director of George Washington University's Graduate School of Political Management, said despite the misgivings expressed by some Republicans, the White House may be able to negotiate a deal that pleases both sides.

"I think this is the opening bid," Kennedy said. "This is the beginning of the conversation."

In his first term, Obama pushed for laws that would use market forces to reduce climate-changing carbon pollution, but the "cap and trade" bill was opposed by industry and failed in Congress.

His administration pumped $90 billion in economic stimulus funds into clean energy and "green jobs" projects, helping to dramatically expand renewable energy production in America.

But some projects failed, including a California solar panel maker called Solyndra that had received a $527 million government loan. Critics excoriated his administration for that failure, as well as for delaying approval of the Keystone XL crude oil pipeline from Canada.

The energy trust fund "is a more pragmatic approach to try to continue investments in green energy given the degree to which the (clean energy) brand has been damaged," said Kennedy, a former Republican congressman from Minnesota.

(Editing by Doina Chiacu and Mohammad Zargham)

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Israel's Prime Minister Benjamin Netanyahu points to a red line he has drawn on the graphic of a bomb as he addresses the 67th United Nations General Assembly at the U.N. Headquarters in New York, September 27, 2012.

JERUSALEM | Fri Mar 15, 2013 6:20pm EDT

JERUSALEM (Reuters) - U.S. President Barack Obama visits Israel next week at the onset of spring - the "red line" previously drawn by his host, Prime Minister Benjamin Netanyahu, to trigger an attack on Iran's nuclear sites.

But an Israeli-Iranian war, Washington's nightmare as it tries to scale back defense commitments abroad and avoid a draining Gulf oil crisis, does not appear trip-wire imminent.

Officials and analysts say Iran warded off Israel's threat by calibrating mid-level uranium enrichment so it does not accrue enough fuel for a potential first bomb - the threshold Netanyahu warned about in a United Nations speech in September.

He was presenting a worst-case extrapolation from U.N. nuclear inspector reports. The most recent of those, however, found a slowdown in the stockpiling of the 20 percent fissile uranium that Iran, in the face of mounting Western suspicions, says is part of an entirely peaceful program. [ID:nL6N0BLD2Y]

Netanyahu has not publicly revised the spring-to-summer 2013 dating for his "red line". But several Israeli officials privately acknowledged it had been deferred, maybe indefinitely.

"The red line was never a deadline," one told Reuters.

The chief U.S. military officer, General Martin Dempsey, has questioned Israel's ability to deliver lasting damage to Iran's distant, defended facilities. Netanyahu, meanwhile, makes little secret of preferring that Washington take the lead in any war.

Yet while mobilizing Gulf forces and saying it was open to military force as a last resort, the Obama administration has resisted Israeli calls to present Tehran with a clear ultimatum.

CLOCKS AND KILOS

Interviewed by Israel's top-rated television news program on Thursday, Obama voiced cautious hope that negotiations, re-launched last month between the United States, five other world powers and Iran, could still curb its disputed nuclear drive.

"There's a window - not an infinite period of time - but a window of time where we can resolve this diplomatically, and that it is in all of our interests," he told Channel Two TV.

The U.S. "red line" was Iran reaching the verge of acquiring a nuclear bomb, Obama said, adding: "That would take over a year or so ... But obviously we don't want to cut it too close."

Confidence in Obama is not unanimous among Netanyahu's circle. While one Israeli official, speaking to Reuters on condition of anonymity, said "American presidents don't bluff" and that therefore Obama should be trusted, others worried Iran might elude scrutiny and dash to nuclear arms capability.

"The key question is not when Iran will have a bomb, but only when we can no longer prevent Iran from having a bomb," Michael Oren, Israel's ambassador to Washington, told reporters.

He accused Iran of planning to run an accelerated, "shorter track" toward nuclear weaponry "that is invisible because it is underground".

A February 21 U.N. report said Iran had 167 kg (367 lb) of mid-level enriched uranium, in gas form, after converting some of the stockpile to solid reactor fuel. Experts say it would need 240-250 kg (530-550 lb) of the gaseous material for a bomb, though the fuel would have to be further enriched to 90 percent purity.

Yet Iran has also been expanding centrifuges so it could rapidly ramp up mid-level enrichment if it chose, diplomats say.

Netanyahu alluded to those developments on March 4 when he reiterated his "red line" in a speech to a pro-Israel lobby in Washington, saying Iran was "putting itself in a position to cross that line very quickly once it decides to do so".

An Israeli official posited Iran could gather 230 kg to 240 kg of mid-level uranium - just short of a bomb's worth - and then, between inspectors' weekly visits to the enrichment plants, churn out the few kilograms required to close the gap.

Next, it could move all the material to a secret location for prospective later processing into weapons fuel, making the Islamic Republic a "latent nuclear power", the official argued.

"For now, we know what sites would have to be targeted in a military strike," the official said. "Can any of us, even the Americans, be sure of having such full knowledge in the future?"

The United States sounds more secure about nuclear inspections and intelligence monitoring of the Iranians, as well as in its ability to intervene militarily at short notice.

"We assess Iran could not divert safeguarded material and produce a weapon-worth of WGU (weapons-grade uranium) before this activity is discovered," U.S. National Intelligence Director James Clapper said on Tuesday.

STRATEGIC AMBIGUITY

Gary Samore, Obama's former nuclear non-proliferation adviser, disputed the idea that Iran would break out of the U.N. inspections regime with just one bomb's worth of fuel, or that it would be capable of making a quick switch to the highest level of uranium enrichment, given its technical lags.

"Nobody knows, including the Iranians, how much 20 percent (enriched uranium) they need to have a bomb's worth. They have never done it. They have never converted," Samore, who is now executive director at Harvard Kennedy School's Belfer Center for Science and International Affairs, said in a phone interview.

That made threshold questions "inherently ambiguous", said Samore, who referred to Netanyahu's "red line" alternatively as a "red zone".

Mark Fitzpatrick, a former U.S. State Department official who heads the non-proliferation and disarmament program at London's International Institute for Strategic Studies, had similar doubts about whether Iran would try to sneak past Netanyahu's "red line" and, if so, whether Israel would respond with strikes.

"Nobody's going to make a war-or-peace decision based on a few kilograms of 20 percent enriched uranium," he said. "Nobody knows what Israel's real 'red line' is. I don't think Israel knows either."

Fitzpatrick faulted Netanyahu for fixating on Iran's 20 percent enrichment, arguing that this risked distracting from ongoing progress in other risky aspects of its nuclear program like centrifuge improvements and tonnes of low-purity uranium.

"That may not have been a clever way of putting it, because Iran is able to make tactical adjustments and can push back the so-called 'red line' as long as it wants," he said.

But Fitzpatrick also saw a tactical gain for Netanyahu "in reminding the world that there was a concrete threat here, after the world has heard so much saber-rattling from Israel".

Israel, which is reputed to have the region's sole atomic arsenal, has spoken about being ready to attack Iran for close to a decade - rhetoric some Israeli officials say was designed, at least in part, to stiffen the determination of war-wary world powers to find a diplomatic alternative through sanctions.

Samore said the international coalition had been "deeply energized for years" in confronting Tehran. "I think we still have a reasonable prospect of stopping them, and that if the Iranians misstep, the U.S. will act," he said.

(Writing by Dan Williams; Additional reporting by Matt Spetalnick in Washington; Editing by Jeffrey Heller, Will Waterman and Roger Atwood)

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U.S. President Barack Obama speaks about strengthening the economy for the middle class and measures to combat gun violence during a visit to Hyde Park Academy in Chicago, Illinois February 15, 2013.

CHICAGO | Fri Feb 15, 2013 9:59pm EST

CHICAGO (Reuters) - President Barack Obama acknowledged on Friday that he wished his father had been a bigger part of his life as he argued that stronger families are just as important as gun control in reducing crime and violence in poverty-stricken neighborhoods.

Obama returned to his old home neighborhood on the South Side of Chicago with a different take on his gun control message - that it will require an improved home environment for children to reduce the possibility that they will one day resort to violence.

To do that, he said, will require better economic conditions for low- and middle-class Americans, one reason he wants to raise the hourly minimum wage from $7.25 to $9, a proposal he offered in his State of the Union speech on Tuesday.

Obama, the son of a black Kenyan father and a white mother from Kansas, was raised largely by his mother and grandparents in Hawaii. His father, Barack Obama Sr., divorced Obama's mother when the president was two years old, and he was the central figure in Obama's memoir, "Dreams from My Father."

Pointing to a group of teenage boys with whom he had met privately before delivering a speech, Obama said he had not been much different than them.

"Don't get me wrong," he said in the address to high school students at Hyde Park Academy. "As the son of a single mom, who gave everything she had to raise me with the help of my grandparents, I turned out okay."

"But at the same time, I wish I'd have had a father who was around and involved," he told the mainly black audience of about 700.

Obama worked as a community organizer in the South Side of Chicago but had a more privileged background than many of the children he addressed on Friday.

Chicago has suffered a surge in gang-related violence and is one of the most violent cities in America. Obama's visit comes a week after his wife, Michelle, attended the funeral in the city of 15-year-old honor student Hadiya Pendleton, who was shot dead a week after participating in the presidential inauguration.

At the start of his second term in office, Obama wants Congress to approve a series of tighter gun controls like requiring background checks for all firearms purchasers and banning assault weapons and high-capacity ammunition clips.

But as he made clear in Chicago it will take improvements in the home environment for children to keep them off the streets and that this will require help from parents, teachers and clergy.

"When a child opens fire on another child, there is a hole in that child's heart that government can't fill," Obama said.

In too many areas, "it can feel like the future only extends to the next street corner or the outskirts of town...There are entire neighborhoods where they don't see an example of somebody succeeding," he said.

Corey Stevens, 17, a high school senior, was one of the students who got to meet with Obama before his speech.

"I think that he needed to come back here and get the message to the people up close and personal and let them know that this needs to stop," said Stevens, who wants to go into law enforcement.

Hadiya Pendleton's father, Nathaniel Pendleton, who was in the audience, had a message for those who have been following his family's tragedy in the news -- get involved.

"You never expect this tragedy to knock on your door... But there are preventative measures," Pendleton told Reuters. "So let's try to prevent it instead of waiting for it to happen."

Father Michael Pfleger, a Catholic priest known for his activism against gun violence, agreed with Obama that gun laws alone won't solve the problem.

"We have to look in our urban communities and realize that we have a lack of good schools, lack of employment, abundance of poverty, abundance of folks coming back out of penal institutions with records," Pfleger said. "Until we deal with all those issues, you create the perfect storm for violence."

(Writing by Steve Holland; Additional reporting by Renita D. Young; Editing by Alistair Ball, Mary Wisniewski, David Brunnstrom and Carol Bishopric)

(This story was corrected to read, "...or the outskirts of town..." instead of "...of the outskirts of town...")

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Demonstrators carry a replica of a pipeline during a march against the Keystone XL pipeline in Washington, February 17, 2013.

WASHINGTON | Sun Feb 17, 2013 6:37pm EST

WASHINGTON (Reuters) - Thousands of protesters gathered on the Washington's National Mall on Sunday calling on President Barack Obama to reject the controversial Keystone XL oil pipeline proposal and honor his inaugural pledge to act on climate change.

Organizers of the "Forward on Climate" event estimated that 35,000 people from 30 states turned out in cold, blustery conditions for what they said was the biggest climate rally in U.S. history. Police did not verify the crowd size.

Protesters also marched around the nearby White House, chanting "Keystone pipeline? Shut it down." Among the celebrities on hand were actresses Rosario Dawson and Evangeline Lilly, and hedge fund manager and environmentalist Tom Steyer.

The event came days after a bipartisan group of U.S. senators made the latest call for Obama to approve the $5.3 billion pipeline, seen by many as an engine for job growth and another step toward energy independence.

A new poll by Harris Interactive showed 69 percent of respondents said they support construction of the pipeline, with only 17 percent saying they oppose it.

One of Sunday's main organizers, climate activist Bill McKibben, said that approving the pipeline, which would transport crude oil from the oil sands of northern Alberta to refineries and ports in Texas, would be akin to lighting a "carbon bomb" that could cause irreparable harm to the climate.

"For 25 years our government has basically ignored the climate crisis: now people in large numbers are finally demanding they get to work," said McKibben, founder of the environmental group 350.org.

Other major organizing groups on Sunday included the Sierra Club and the Hip-Hop Caucus.

The proposed TransCanada Corp project has been pending for 4-1/2 years. A revised route through Nebraska, which would avoid crossing sensitive ecological zones and aquifers, was approved by that state's governor last month.

Backers of Keystone, which would transport 830,000 barrels of oil per day, say it would provide thousands of jobs in the United States and increase North American energy security.

Environmentalists oppose the pipeline because the oil sands extraction process is carbon intensive, and say the oil extracted is dirtier than traditional crude oil.

Van Jones, Obama's former green jobs adviser, said if the president approved the pipeline just weeks after pledging to act on climate change, it would overshadow other actions Obama takes to reduce pollution.

"There is nothing else you can do if you let that pipeline go through. It doesn't matter what you do on smog rules and automobile rules - you've already given the whole game way," said Jones, who is president of Rebuild the Dream, a non-government organization.

Democratic Senator Sheldon Whitehouse of Rhode Island, the lone member of Congress to speak at the rally, told Reuters Obama risked creating a "credibility gap" if he approved the pipeline.

"He would have to roll out a very complete and very strong package to offset something that on its own is described by government scientist as ‘game-over' on climate," he said.

Still, some of Obama's core constituents favor the pipeline, including the labor union AFL-CIO's building and construction unit, which sees the potential for job creation for its members, and certain Democratic lawmakers.

In January, nine Democratic senators joined 44 Republicans in urging the president to approve Keystone XL.

(Reporting By Valerie Volcovici; editing by Ros Krasny and Mohammad Zargham)

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WASHINGTON | Sun Feb 17, 2013 5:11pm EST

WASHINGTON (Reuters) - Lawmakers complained on Sunday that President Barack Obama had failed to protect Iranian dissidents from persecution by Tehran following a deadly attack on their camp near Baghdad, and urged they be allowed back to their long-time base in Iraq.

A congressional delegation led by Dana Rohrabacher, chairman of the Republican-controlled House subcommittee on Europe, said that the Obama administration should not have backed the movement of members of Iranian dissident group Mujahadin-e-Khalq, or MEK, to a place where they would not be safe.

At least five people were killed in a February 9 rocket attack on their base in the former U.S. military compound "Camp Liberty" in the western part of the Iraqi capital. The attack was condemned by the United Nations.

"It was unethical for the United States to have endorsed the relocation of the people whom we promised to protect to Camp Liberty, where we knew they would not have proper protection, just because it wants to please Iraqi Prime Minister Nuri al-Maliki and the ruling mullahs of Iran," the delegation said in statement after meeting Iranian dissident leaders in Paris.

The MEK, which calls for the overthrow of Iran's clerical rulers and fought alongside the forces of former Sunni dictator Saddam Hussein in the Iran-Iraq war in the 1980s, was relocated last year from its long-time Iraqi home in exile at Camp Ashraf.

The MEK is no longer welcome in Iraq under the Shi'ite Muslim-led government, which came to power after U.S.-led forces invaded and toppled Saddam in 2003.

But some U.S. politicians view it as a potential opposition force to replace Tehran's rulers and have taken up their cause in Washington. The congressional delegation issued its statement after meeting with Maryam Rajavi, who heads the Paris-based National Council of Resistance of Iran (NCRI).

"Iran needs regime change and the MEK can help bring it about," the congressional delegation said, sharply criticizing the U.N. mission in Iraq for failing to grant more MEK members in Camp Liberty the status of refugees.

"The U.S. Government, the Secretary General of the United Nations, and the UN High Commissioner for Refugees should give top priority to resolving the security situation of the residents of Camp Liberty - which can be ensured by their return to Camp Ashraf."

(Reporting By Alister Bull; Editing by Philip Barbara)

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1 of 2. U.S. President Barack Obama (3rd L) hugs Sarah Davino (L) and Mary Davino (2nd L), as he awards the Presidential Citizens Medal posthumously to their family member Rachel Davino, a teacher who gave her life in the Sandy Hook school shooting in Connecticut in December, in the East Room at the White House in Washington, February 15, 2013.

WASHINGTON | Fri Feb 15, 2013 2:53pm EST

WASHINGTON (Reuters) - President Barack Obama marked a poignant moment in his push to curb gun violence as he awarded presidential medals posthumously on Friday to six educators killed in the Newtown school massacre, saying they gave their lives to protect "the most innocent and helpless among us."

Consoling tearful relatives as they stepped on stage at the White House, Obama paid homage to the four teachers and two administrators killed in the December 14 shooting rampage at Sandy Hook Elementary School in Connecticut, a tragedy that sparked nationwide calls for tighter gun control laws.

Though Obama made no public mention of his gun-control drive, the solemn ceremony unfolded against the backdrop of vocal resistance from gun advocates and their supporters on Capitol Hill to any new restrictions. In private, however, the president was said to have assured victims' relatives: "We're really trying to get something done."

As Obama handed out the Presidential Citizens Medals, the nation's second-highest civilian honor, he focused on the slain women's courage. Twenty first-graders were also killed in the attack, which was carried out by 20-year-old Adam Lanza.

They came to school that morning with "no idea that evil was about to strike," Obama told the audience. "And when it did they could have taken shelter by themselves, they could have focused on their own safety, on their own well-being, but they didn't."

"They gave their lives to protect the precious children in their care and gave all they had for the most innocent and helpless among us. That's what we honor today."

Obama, who has called the day of the mass shooting the worst of his presidency, is moving swiftly to try to build momentum for gun control legislation. He even used his otherwise policy-heavy State of the Union address on Tuesday night to make an impassioned appeal for lawmakers to act.

But he faces an uphill battle against a powerful pro-gun lobby and a strong U.S. tradition of hunting and gun ownership. The right to bear arms is enshrined in the U.S. Constitution.

Principal Dawn Hochsprung, school psychologist Mary Sherlach and teachers Rachel D'Avino, Lauren Rousseau, Anne Marie Murphy and Victoria Soto were killed in the attack.

SPECIAL ATTENTION TO NEWTOWN FAMILIES

At the same time as Obama paid tribute to the Sandy Hook educators, he honored a dozen other Americans in fields that included child development, gay rights, military veterans assistance, immigrant outreach and helping disabled women. They were selected from among nearly 6,000 nominations.

But he gave special attention to the Newtown victims, wrapping mothers and daughters in his arms as the families stood one-by-one to accept the medals.

Hochsprung's mother wiped away tears as she was handed the award. The 47-year-old principal was shot dead reportedly when she sought to confront the shooter after hearing gunshots.

D'Avino's sister, Sarah, who recounted Obama's closed-door comment, said his meeting with the families contrasted with his visit to grief-stricken Newtown in December in the aftermath of the massacre, when he carefully avoided discussing the fraught politics of gun control.

"What he said today is that we're really trying for you," she told reporters after the ceremony in the East Room. Her 29-year-old sister provided behavioral therapy at the school.

D'Avino acknowledged the political hurdles but insisted they could be overcome.

"I don't think anyone is insinuating we're trying to take away every single gun in the country. But there is no reason this kid was able to fire off as many rounds as he did, in as little time as he did," she said. "Nobody is protecting their home with a Bushmaster and a 30-round clip, I'm sorry. They are not."

Sherlach's husband Bill blew a kiss toward the heavens and patted his heart as he stood with Obama. "There needs to be a number of things addressed - gun safety, mental health, school safety and parenting," he said later outside the White House.

With a packed second-term agenda that includes immigration reform and climate change, Obama - who has pledged to use the full power of his office to secure tougher gun laws - is seeking progress on the issue before painful memories of December's shooting fade from the public's consciousness.

His push for reinstatement of a ban on assault rifles is seen as possibly the toughest sell in a country where many Americans see gun control as an infringement of their rights.

Obama's call for criminal background checks for all gun buyers is seen having the best chance of winning over Republicans, but that proposal also faces opposition.

The influential National Rifle Association has launched a major advertising campaign against Obama's gun proposals and deployed its lobbyists in force on Capitol Hill.

(Additional reporting by Mark Felsenthal; Editing by Vicki Allen and David Brunnstrom)

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Former U.S. Senator Chuck Hagel (R-NE) testifies during a Senate Armed Services Committee hearing on his nomination to be Defense Secretary, on Capitol Hill in Washington, January 31, 2013. Hagel, 66, is a decorated Vietnam War veteran and a former two-term Republican senator.

WASHINGTON | Sun Feb 17, 2013 6:21pm EST

WASHINGTON (Reuters) - A senior Republican senator said on Sunday that party colleagues will drop tactics to delay a vote on former Senator Chuck Hagel to be defense secretary, saying that President Barack Obama's nominee likely has sufficient support to be confirmed into this key post.

"We will have a vote when we get back, and I am confident that Senator Hagel will probably have the votes necessary to be confirmed as the secretary of defense," Arizona Senator John McCain, who has led the opposition against his former Republican colleague, told NBC's "Meet the Press" program.

Democrats, who control the Senate, have scheduled a vote for February 26, after members return from a week-long recess. Republicans held up the nomination last week in a delay characterized as the first time the Senate had used a procedural tactic called a filibuster to block a defense nominee.

With Democrats holding 55 votes in the 100-seat Senate, Hagel's nomination is expected to win the simple majority of 51 votes needed for his confirmation to become the civilian leader at the Pentagon, once such a vote is allowed.

If confirmed, Hagel, a 66-year old decorated Vietnam War veteran, would replace 74-year-old Leon Panetta.

Hagel, who broke from his party as a senator by opposing former President George W. Bush's handling of the Iraq War, has faced withering criticism from Republicans since Obama nominated him on January 7 to be the defense secretary.

Some Republicans have questioned if Hagel is sufficiently supportive of Israel, tough enough on Iran or capable of leading the Pentagon. McCain continued on Sunday to voice concern.

"I don't believe he is qualified. But I don't believe we should hold up his nomination any further because I think it is a reasonable amount of time to have questions answered."

(Reporting By Alister Bull; Editing by Philip Barbara)

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U.S. House Speaker John Boehner (R-OH) (R) and House Majority Leader Eric Cantor (R-VA) speak to the media on the ''fiscal cliff'' on Capitol Hill in Washington, December 21, 2012.

WASHINGTON | Fri Jan 18, 2013 6:37pm EST

WASHINGTON (Reuters) - Republicans in the House of Representatives backed away on Friday from a fiscal clash with President Barack Obama next month that could have risked a government default and chaos in financial markets, shifting to a new, less aggressive stance.

Top Republican leaders, meeting in Williamsburg, Virginia, said they were prepared to allow the U.S. government to borrow enough money to keep it fully operating for the next three months without demanding immediate spending cuts from Obama.

Instead, the Republicans, who control the House, will require as part of the legislation raising the debt ceiling that the Democratic-led Senate pass a budget plan by April 15.

If the Senate fails to act, they said, members of Congress would not get paid. How that might work in practice, in light of existing budget law and constitutional restrictions on changing congressional salaries in the middle of a term, was unclear. House Republicans hope to pass the legislation next week.

Republican leaders, including House Speaker John Boehner and Majority Leader Eric Cantor, made the announcement after an annual retreat at a resort in Williamsburg, where members listened to pollsters describe the party's decline in standing among American voters.

It followed a humiliating defeat in the "fiscal cliff" battle that ended on New Year's Day with Obama getting tax increases he sought on the wealthy without committing to significant budget cuts Republicans were seeking in return.

World equity and oil prices rebounded after the statement by the Republican leaders.

STRATEGIC SHIFT

The announcement marked a major climbdown for Republicans, who have seen the debt ceiling as their strongest point of leverage in Washington's partisan spending wars, despite the consternation it caused the White House, global financial markets and public opinion.

The White House on Friday welcomed the three-month extension plan as long as it was not conditioned on spending cuts. Obama has argued that negotiations on spending cuts should be part of larger deficit reduction talks, and not be tied to the debt ceiling.

"We are encouraged that there are signs that Congressional Republicans may back off their insistence on holding our economy hostage to extract drastic cuts in Medicare, education and programs middle class families depend on," White House spokesman Jay Carney said in a statement.

Adam Jentleson, a spokesman for Senate Majority Leader Harry Reid, also said the Republican approach was reassuring.

"If the House can pass a clean debt ceiling increase to avoid default and allow the United States to meet its existing obligations, we will be happy to consider it," he said in a statement.

A spokesman for House Democratic leader Nancy Pelosi was less receptive. "This proposal does not relieve the uncertainty faced by small businesses, the markets and the middle class. This is a gimmick unworthy of the challenges we face and the national debate," Drew Hammill said.

The details on the new Republican approach appeared less pressing to party leaders than defusing the politically and economically explosive debt ceiling battle that was expected in late February and early March.

The Treasury needs congressional authorization to raise the current $16.4 trillion U.S. debt limit sometime between mid-February and early March. How long a debt ceiling lasts - a few months or a few years - depends on the amount of borrowing authorized.

Republicans had promised to use the occasion to demand deep spending cuts from Obama and his Democrats, and some had said they were willing to push the government to the brink of default if their demands were not met.

That sort of rhetoric all but vanished on Friday.

"Next week, we will authorize a three month temporary debt limit increase to give the Senate and House time to pass a budget," Cantor said in a statement.

"Furthermore, if the Senate or House fails to pass a budget in that time, Members of Congress will not be paid by the American people for failing to do their job. No budget, no pay."

The statement made no mention of the 27th Amendment to the U.S. Constitution, which says that no law "varying the compensation" of members of Congress shall take effect until after an intervening congressional election.

The plan aims to draw the Senate into action to shrink deficits. The Senate has failed to pass a formal budget resolution in nearly four years, and it has taken no action on House-passed Republican budgets.

Mitch McConnell of Kentucky, the Senate's Republican minority leader, said in a statement he welcomed the pressure on his Democratic counterparts who had "prevented this body from performing its most basic of duties: passing a federal budget."

RETREAT REFLECTION

A key theme to emerge at the Williamsburg conference was a willingness to pursue more incremental steps on deficit reduction. Rather than one massive deal, each fiscal deadline would represent an opportunity to find savings.

After the deadline for a debt ceiling increase, Congress faces a March 1 deadline to avert automatic spending cuts, and the March 27 expiration of funding for government agencies and programs. A three-month debt limit extension would add a further deadline in April or May.

Representative Mick Mulvaney of South Carolina, one of the House's most conservative budget hawks, said he had concluded that smaller steps were the best path forward in dealing with the immediate fiscal crisis.

Instead of passing regular budgets to try to reduce spending, Congress has relied largely on stop-gap spending measures, known as continuing resolutions, to keep the government running.

Senate leaders have said there was no need to pass a budget for the past two fiscal years because the last major budget deal in 2011 set spending levels that were more legally enforceable.

A House Republican leadership aide said it was not anticipated the three-month debt limit legislation would include spending cuts.

Although Boehner previously sought at least $1 in long-term spending cuts for every dollar of debt limit increase, the aide said the reforms associated with requiring budgets from both chambers would meet the speaker's requirements.

(Editing by Fred Barbash and Peter Cooney)

View the original article here

U.S. House Speaker John Boehner (R-OH) (R) and House Majority Leader Eric Cantor (R-VA) speak to the media on the ''fiscal cliff'' on Capitol Hill in Washington, December 21, 2012.

WASHINGTON | Fri Jan 18, 2013 6:37pm EST

WASHINGTON (Reuters) - Republicans in the House of Representatives backed away on Friday from a fiscal clash with President Barack Obama next month that could have risked a government default and chaos in financial markets, shifting to a new, less aggressive stance.

Top Republican leaders, meeting in Williamsburg, Virginia, said they were prepared to allow the U.S. government to borrow enough money to keep it fully operating for the next three months without demanding immediate spending cuts from Obama.

Instead, the Republicans, who control the House, will require as part of the legislation raising the debt ceiling that the Democratic-led Senate pass a budget plan by April 15.

If the Senate fails to act, they said, members of Congress would not get paid. How that might work in practice, in light of existing budget law and constitutional restrictions on changing congressional salaries in the middle of a term, was unclear. House Republicans hope to pass the legislation next week.

Republican leaders, including House Speaker John Boehner and Majority Leader Eric Cantor, made the announcement after an annual retreat at a resort in Williamsburg, where members listened to pollsters describe the party's decline in standing among American voters.

It followed a humiliating defeat in the "fiscal cliff" battle that ended on New Year's Day with Obama getting tax increases he sought on the wealthy without committing to significant budget cuts Republicans were seeking in return.

World equity and oil prices rebounded after the statement by the Republican leaders.

STRATEGIC SHIFT

The announcement marked a major climbdown for Republicans, who have seen the debt ceiling as their strongest point of leverage in Washington's partisan spending wars, despite the consternation it caused the White House, global financial markets and public opinion.

The White House on Friday welcomed the three-month extension plan as long as it was not conditioned on spending cuts. Obama has argued that negotiations on spending cuts should be part of larger deficit reduction talks, and not be tied to the debt ceiling.

"We are encouraged that there are signs that Congressional Republicans may back off their insistence on holding our economy hostage to extract drastic cuts in Medicare, education and programs middle class families depend on," White House spokesman Jay Carney said in a statement.

Adam Jentleson, a spokesman for Senate Majority Leader Harry Reid, also said the Republican approach was reassuring.

"If the House can pass a clean debt ceiling increase to avoid default and allow the United States to meet its existing obligations, we will be happy to consider it," he said in a statement.

A spokesman for House Democratic leader Nancy Pelosi was less receptive. "This proposal does not relieve the uncertainty faced by small businesses, the markets and the middle class. This is a gimmick unworthy of the challenges we face and the national debate," Drew Hammill said.

The details on the new Republican approach appeared less pressing to party leaders than defusing the politically and economically explosive debt ceiling battle that was expected in late February and early March.

The Treasury needs congressional authorization to raise the current $16.4 trillion U.S. debt limit sometime between mid-February and early March. How long a debt ceiling lasts - a few months or a few years - depends on the amount of borrowing authorized.

Republicans had promised to use the occasion to demand deep spending cuts from Obama and his Democrats, and some had said they were willing to push the government to the brink of default if their demands were not met.

That sort of rhetoric all but vanished on Friday.

"Next week, we will authorize a three month temporary debt limit increase to give the Senate and House time to pass a budget," Cantor said in a statement.

"Furthermore, if the Senate or House fails to pass a budget in that time, Members of Congress will not be paid by the American people for failing to do their job. No budget, no pay."

The statement made no mention of the 27th Amendment to the U.S. Constitution, which says that no law "varying the compensation" of members of Congress shall take effect until after an intervening congressional election.

The plan aims to draw the Senate into action to shrink deficits. The Senate has failed to pass a formal budget resolution in nearly four years, and it has taken no action on House-passed Republican budgets.

Mitch McConnell of Kentucky, the Senate's Republican minority leader, said in a statement he welcomed the pressure on his Democratic counterparts who had "prevented this body from performing its most basic of duties: passing a federal budget."

RETREAT REFLECTION

A key theme to emerge at the Williamsburg conference was a willingness to pursue more incremental steps on deficit reduction. Rather than one massive deal, each fiscal deadline would represent an opportunity to find savings.

After the deadline for a debt ceiling increase, Congress faces a March 1 deadline to avert automatic spending cuts, and the March 27 expiration of funding for government agencies and programs. A three-month debt limit extension would add a further deadline in April or May.

Representative Mick Mulvaney of South Carolina, one of the House's most conservative budget hawks, said he had concluded that smaller steps were the best path forward in dealing with the immediate fiscal crisis.

Instead of passing regular budgets to try to reduce spending, Congress has relied largely on stop-gap spending measures, known as continuing resolutions, to keep the government running.

Senate leaders have said there was no need to pass a budget for the past two fiscal years because the last major budget deal in 2011 set spending levels that were more legally enforceable.

A House Republican leadership aide said it was not anticipated the three-month debt limit legislation would include spending cuts.

Although Boehner previously sought at least $1 in long-term spending cuts for every dollar of debt limit increase, the aide said the reforms associated with requiring budgets from both chambers would meet the speaker's requirements.

(Editing by Fred Barbash and Peter Cooney)

View the original article here

WASHINGTON | Fri Jan 18, 2013 3:43pm EST

WASHINGTON (Reuters) - Reeling from an historic drought, the hottest year on record and more frequent wild weather, mayors from a number of U.S. cities urged the White House this week to take the lead on setting an agenda to address climate change.

City leaders said that only the federal government has the tools and clout to address greenhouse gases often blamed for warming the planet, while mayors focus on issues of "local warming" such as providing a reliable water supply or protecting citizens during dangerous weather events such as the 1995 Chicago heat wave that was blamed for over 700 deaths.

"We are fixing pot holes, dealing with transit issues," Seattle mayor Michael McGinn said while attending the U.S. Conference of Mayors' winter meeting. "But this can be a top tier issue for the president."

On the night of his reelection, Obama said fighting climate change would be a priority in his second term. He has since repeated the point, but without giving policy specifics.

And for now officials are doing their work quietly.

The White House asked that a discussion about climate change at the mayors' meeting on Thursday take place behind closed doors, frustrating some participants, even as hot button topics from immigration to gun control got public airings.

"This should be discussed openly," said Jim Brainard, the Republican mayor of Carmel, Indiana, who co-chaired the climate panel.

White House liaison for climate change Heather Zichal led the discussion, but declined to comment on why the meeting was closed.

"At the end of the day, it was a productive conversation," she said, noting that the White House was eager to hear from cities on reducing emissions of greenhouse gas.

Los Angeles, for example, plans to slash carbon emissions from government sources 35 percent below 1990 levels by 2030, a more ambitious target than even the state has set.

Among other measures, Chicago is spending billions of dollars to boost public transit and help public buildings save energy.

Mayors say they are proud of such steps and understand Obama's reluctance to take on a politically charged issue, but only Washington can achieve the overall greenhouse gas cuts that many say are needed.

"We are looking for leadership from the president in detailing to the American people the magnitude of this issue," McGinn said after the meeting with about two dozen peers.

DASHED CLIMATE HOPES

The Obama administration pinned its hopes on Congress to enact a comprehensive energy and climate bill that would have set a national price on carbon dioxide emissions during the president's first term.

That effort failed in bitter partisan wrangling, forcing the administration to rethink its strategy and reach for existing regulations as a way to mitigate climate warming emissions.

"I absolutely would anticipate that we will continue to use existing authority to make progress in this area," Zichal said after her meeting with mayors.

But efforts by states and cities will also be crucial to "move the needle" on reducing emissions, she said, noting that she heard new ideas about city climate initiatives that create jobs and reduce pollution.

Mayors contend that those efforts often need federal funding. They are counting on help from Washington to upgrade storm water systems, for example, and otherwise brace for the practical fallout from more extreme weather.

Although Greg Fischer, mayor of Louisville, Kentucky, said not all his constituents embrace the idea of man-made climate change, more frequent severe weather is "a far-reaching issue that touches almost every area of the city."

Scientists caution that no single weather event can be blamed on climate change. But the force of Hurricane Sandy, which devastated parts of New York and New Jersey in October, and a withering drought in the Midwest, are seen as harbingers.

"There is a lot of call for the president to use his 'bully pulpit' and explain the consequences here," said Brainard.

(Reporting By Patrick Rucker and Valerie Volcovici, editing by Ros Krasny and Andre Grenon)

View the original article here

1 of 2. U.S. President Barack Obama announces his nomination of White House chief of staff and budget expert Jack Lew (R) as his next treasury secretary, in the East Room of the White House in Washington, January 10, 2013.

WASHINGTON | Thu Jan 10, 2013 7:06pm EST

WASHINGTON (Reuters) - President Barack Obama on Thursday nominated his chief of staff, Jack Lew, as the next Treasury secretary, praising him as a expert on the pressing national issues of U.S. government spending cuts and deficit reduction.

If confirmed by the Senate as expected, Lew would succeed Timothy Geithner and take the lead on difficult negotiations with Congress on how to cut the nation's massive debt and rein in spending - a central challenge for Obama's second term.

Lew, a 57-year-old New Yorker who has previously served as White House budget chief, is likely to face tough questions from Republicans in his Senate Finance Committee confirmation hearing after the bruising year-end battle over tax increases on the wealthy.

Obama described Lew as "a low-key guy who prefers to surround himself with policy experts rather than television cameras," and said the son of a Polish immigrant had a deep belief in public service.

"Over the years, he's built a reputation as a master of policy who can work with members of both parties and forge principled compromises," Obama said.

Since the Treasury secretary signs U.S. currency, Obama teased Lew for his unusually loopy signature and joked that the nominee had promised "to make at least one letter legible in order not to debase our currency."

Denis McDonough, Obama's deputy national security adviser, is considered the leading candidate to replace Lew as White House chief of staff.

Lew has experience in tough financial negotiations, having led talks with Congress in 2011 that brought a deal to avert a U.S. debt default. A similar battle looms now.

As budget director for former President Bill Clinton, he presided over a string of budget surpluses between 1998 and 2000. "For all the talk out there about deficit reduction, making sure our books are balanced, this is the guy who did it, three times," Obama said.

NEXT STEP: THE SENATE

Lew's nomination now will be vetted by the Senate, where Senate Finance Chairman Max Baucus, a Democrat, promised a "speedy but thorough" hearing. No date has yet been set.

Senator Orrin Hatch, the top Republican on the panel, said he plans to ask Lew about the administration's strategy for spending cuts, something Republicans have insisted needs to be made clear before they will agree to raise the debt ceiling.

Obama has vowed not to negotiate over the debt ceiling, which could be reached as early as mid-February.

"It's imperative that Mr. Lew outline the administration's plans on tackling our unsustainable debt, what areas of federal spending should be cut, and what kind of reforms - from our tax code to our entitlement programs - are needed to get our fiscal house in order," Hatch said in a statement.

Senator Bernie Sanders of Vermont, an independent who caucuses with Democrats, said he would not vote for Lew because he did not think he would "stand up" to Wall Street and lobbyists. Sanders said Lew likely would win enough votes for confirmation.

Republican Senator Jeff Sessions of Alabama said he thinks Lew "needs to be held accountable" for Obama's economic policies.

"We need somebody with international credibility, a heavyweight financial person to help get this country's growth path moving," Sessions told Reuters.

LEW A 'TOUGH DUDE'

At the White House announcement, Geithner earned sustained applause for his work helping the administration navigate the financial crisis that put banks at risk and cratered the housing market early in Obama's first term.

At least two former White House budget directors were in the audience for the Lew announcement, including Alice Rivlin, who headed the budget office in the early 1990s, later became a vice chair of the Federal Reserve, and who remains a fixture in fiscal policy debate.

Also attending was Franklin Raines, who led the budget office from 1996 to 1998. He was ousted as chief executive of mortgage finance giant Fannie Mae after an accounting scandal.

Some analysts have questioned whether Lew has enough experience working on international financial issues and on banking regulations.

But the White House has highlighted international experience Lew gained during a stint at the State Department, and his "strong relationships in the business community," having worked as a managing director at Citigroup.

Thomas Donohue, president of the U.S. Chamber of Commerce, said that all Treasury secretaries have to "compensate for the areas where they don't have experience" with strong deputies.

Donohue, whose business lobby has often butted heads with the Obama administration, told reporters he thought Lew was a "skilled operative" and a "tough dude."

"I think Jack Lew will do fine," Donohue said.

(Additional reporting by David Lawder, Mark Felsenthal, Steve Holland, Jeff Mason, Richard Cowan, Rachelle Younglai and Roberta Rampton; Editing by Will Dunham)

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Former Sen. Chuck Hagel (R-NE) (L), sits down before giving testimony to the Senate Armed Services Committee to be Defense Secretary, on Capitol Hill in Washington, January 31, 2013. Hagel, 66, is a decorated Vietnam War veteran and a former two-term Republican senator.

WASHINGTON | Thu Jan 31, 2013 1:06pm EST

WASHINGTON (Reuters) - From his lonely position as an early Republican critic of the Iraq war, former Nebraska Senator Chuck Hagel sometimes lectured his more timid Senate colleagues. "If you wanted a safe job, go sell shoes," he told them.

President Barack Obama's nominee for defense secretary began a Senate confirmation process on Thursday that revived the contentious relations the fiercely independent Vietnam war veteran had with fellow Republicans over his political career.

"I'm proud of my record," Hagel declared before the Armed Services Committee. "I'm on the record on many issues. But no one individual vote, no one individual quote, no one individual statement defines me, my beliefs or my record."

A social conservative and strong internationalist who co-chaired John McCain's failed Republican presidential campaign in 2000, Hagel might have seemed an unlikely pick for Obama were it not for his opposition to the Iraq war launched in 2003 by former President George W. Bush, a Republican.

Opposing that war was the issue on which Democrat Obama also rose to national prominence and he has said that Iraq was not the only matter where he held similar views with Hagel, who was also once touted as presidential material.

"He's a staunch Republican, but Chuck and I agree almost on every item of foreign policy," Obama said in August 2008, a month after joining Hagel on a tour of Iraq.

Hagel's detractors noted he had voted at times against U.S. sanctions on Iran, and said he had made disparaging remarks about the influence of what he called a "Jewish lobby" in Washington.

Hagel rejects the allegations, saying that he had always supported Israel, and if confirmed he would ensure America's military is prepared to strike Iran if necessary.

Hagel has also been critical of the size of the American military, saying in an interview in 2011 that the Defense Department was "bloated" and needed "to be pared down."

Hagel served two terms in the Senate, representing the state of Nebraska, and left in 2008. He is now a professor at Georgetown University in Washington D.C.. He also serves as co-chairman of the President's Intelligence Advisory Board and is a member of the Secretary of Defense's Policy Board.

Since he left the Senate, Hagel has been a big critic of his own party. He told the Financial Times in 2011 that he was "disgusted" by the "irresponsible actions" of Republicans during a fractious debate over raising the U.S. debt-ceiling in 2011.

Last year he endorsed a Democratic candidate for Senate from Nebraska - former Senator Bob Kerrey - instead of Republican Deb Fischer, who won.

Hagel would not be the first Republican to serve Obama as Pentagon chief. Bob Gates, Obama's first defense secretary, was a holdover from his predecessor George Bush.

CLASHES WITH FELLOW REPUBLICANS

While he was in the Senate as a member of the Foreign Relations, Banking, and Intelligence Committees, Hagel often clashed with his party's leaders on foreign and defense policy.

He co-sponsored legislation to ease U.S. trade restrictions with Cuba, and at times voted against trade sanctions on Iran and Libya.

In 2002 Hagel said the U.S. should try to improve relations with the countries Bush had branded an "axis of evil" - Iraq, Iran, and North Korea.

The same year, when Hagel expressed doubts about the Bush administration's buildup to war in Iraq, the conservative Weekly Standard magazine branded him part of an "axis of appeasement." But Hagel did vote to give the president the authority to carry out the March 2003 invasion.

Later Hagel said he regretted that vote and became a persistent critic of the conflict. In January 2007, he was the only Republican on the Senate Foreign Relations Committee to support a non-binding measure that criticized Bush's decision to send more troops to Iraq.

Hagel told senators they must take a stand on "the most divisive issue in the country since Vietnam," a war in which he had fought, but later decided was wrong. His stance put him at odds with McCain, who also has a reputation as a maverick, and Hagel was pilloried by other Republicans.

Bush's vice president Dick Cheney reflected the view of many in his party when he told Newsweek: "I believe firmly in Ronald Reagan's 11th Commandment: thou shalt not speak ill of a fellow Republican. But it's very hard sometimes to adhere to that where Chuck Hagel is involved."

Hagel did not make a public endorsement in the 2008 presidential race, but his wife Lilibet endorsed Obama and sat with Obama's wife Michelle during a presidential debate with McCain.

Hagel skipped the 2008 Republican convention, an important pre-election event, and further irked his party by telling the Omaha World-Herald newspaper that it was a "stretch" to say McCain's running mate Sarah Palin would be qualified to be president.

He had once been considered a contender for the 2008 presidency himself. Instead he said in September 2007 that he was dropping out of politics and retiring from the Senate when his term ended the following year.

Born in 1946, Hagel grew up in Nebraska as the oldest of four boys, and made a fortune by launching a cellphone company in the 1980s. His father was also a military man, a World War II veteran who died of a heart attack when Chuck was 16.

Hagel and his younger brother Tom volunteered for Vietnam, and Hagel saved Tom's life there by pulling him out of a burning vehicle.

In the early 1980s, when Ronald Reagan was president, Hagel served as deputy administrator of the Veterans Administration. (Reporting By Susan Cornwell; Editing by David Storey)

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U.S. President Barack Obama's nominee for Secretary of Defense, former Senator Chuck Hagel (L), stands next to counterterrorism adviser John Brennan (R), the nominee for CIA Director, at the White House in Washington January 7, 2013.

WASHINGTON | Thu Jan 10, 2013 7:52pm EST

WASHINGTON (Reuters) - Chuck Hagel, President Barack Obama's pick to become the next U.S. defense secretary, has begun calling critics in the Senate in an attempt to clarify his views about how to deal with Iran, Hezbollah and Hamas before his upcoming nomination hearing.

The decorated Vietnam veteran's Republican credentials have done little to rally support with his party, which he publicly split with as a senator by opposing the Iraq war during the Bush administration.

Hagel's private calls to lawmakers and efforts by supporters to defend him publicly are part of what is likely to be a hard-fought battle over his nomination. Opponents tried for weeks to dissuade Obama from choosing the former Nebraska senator.

One prominent senator, Republican Lindsey Graham of South Carolina, predicted even before his nomination that Hagel, if confirmed, would be "the most antagonistic secretary of defense towards the State of Israel in our nation's history."

U.S. officials who have spoken with Hagel since he was nominated on Monday say he has been calling senators before confirmation hearings begin in the coming weeks. Current and former U.S. officials say he is particularly concerned with portrayals of his record on Iran. Critics accuse him of opposing sanctions and being satisfied with containing Tehran, as opposed to preventing it from obtaining a nuclear weapon.

Iran says its nuclear ambitions are peaceful.

"He feels that who he is, what he stands for and what his attitudes are have been misrepresented and distorted," said Dennis Ross, a former top Obama Middle East adviser.

"What he said to me very clearly was that ... he deeply believes that Iran does need to be prevented from having the bomb and that he doesn't believe in containment."

By tradition, Cabinet nominees are expected to avoid public comment until their confirmation hearings.

Republican Senator John Cornyn of Texas, in an opinion piece entitled "Why I Can't Support Hagel," accused Hagel of failing to understand the threat from Iran and groups like Hamas.

One U.S. official who is familiar with the information Hagel is providing to members of the Senate defended Hagel's approach to the militant groups Hezbollah and Hamas. As a senator, Hagel decided not to join 88 other senators in a 2006 letter calling on the European Union to designate Lebanon-based Hezbollah a terrorist organization.

The official, speaking on condition of anonymity, said Hagel believes it is not appropriate for members of Congress to write foreign leaders and that they should write the president, instead. More important, the official said, was Hagel's voting record.

"There were a number of pieces of legislation that actually called on Hezbollah to be a terrorist organization that he supported and voted for," the official said.

On Hamas, the Palestinian group that controls the Gaza Strip, the official said Hagel also felt his position was being misrepresented. Despite claims to the contrary by critics, Hagel does not support direct, unconditional engagement with Hamas and agrees it must first renounce violence, he said.

The officials declined to say which lawmakers Hagel has spoken with but said they included members of both parties. Republican Senator John McCain of Arizona has spoken with him and the two agreed to meet, McCain's spokesman said.

Outgoing Defense Secretary Leon Panetta, following two meetings with Hagel this week, on Thursday predicted that Hagel would ultimately be confirmed as his successor.

"In these confirmation battles, there are a lot of charges that will be out there," Panetta said. "But ultimately, the truth prevails. And I think the truth in this case will mean that he'll be confirmed."

(Editing by Warren Strobel and Doina Chiacu)

View the original article here

U.S. President Barack Obama delivers remarks at the White House in Washington November 28, 2012.

WASHINGTON | Thu Jan 31, 2013 6:19pm EST

WASHINGTON (Reuters) - The chief of a group of more than 200 CEOs said on Thursday that President Barack Obama had told the business community last month he might back a territorial tax system, a regime that would exempt offshore corporate profits from U.S. taxation.

Corporate America is pushing for the United States to move to such a regime to make businesses more competitive against foreign rivals that pay no taxes on overseas earnings. The United States currently taxes corporate profits earned abroad only when they are brought into the country.

In 2011, then Treasury Secretary Timothy Geithner privately agreed to move to such a regime in failed talks with Republicans to secure a major budget deal, according to aides present.

During last year's presidential election campaign, Vice President Joe Biden criticized a territorial tax system, employing populist rhetoric to blast companies that shift their business and jobs abroad.

John Engler, president of the Business Roundtable, a CEO lobbying group, said that in meetings during last month's budget standoff between the White House and Congress, Obama was moving back in the business community's direction on the issue.

"He reaffirmed his support for corporate tax reform and he was acknowledging the importance of ... a territorial system, which I think had been a little bit of a question," Engler said.

A White House official on Thursday said Obama is eager to "pursue corporate tax reform that lowers the rate ... but does not believe that a pure territorial system is the best way to achieve this goal."

A territorial system is seen as having a chance of winning approval in Congress only if it were to be coupled with a major budget deal, where Obama could win some of his priorities.

The Business Roundtable is composed of chief executives from marquee companies ranging from mega-retailer Wal-Mart Stores Inc to Wall Street's JPMorgan Chase & Co.

TAX REVAMP UNCERTAIN

Lawmakers in Congress have been working on a tax code overhaul for more than a year, though its prospects are unclear given a crowded legislative agenda and disputes over revenue.

Obama last year pitched a corporate tax revamp that included cutting the top corporate tax rate to 28 percent from 35 percent and closing a number of business tax breaks to pay for the cut.

Pam Olson, assistant treasury for tax policy under Republican President George W. Bush and now chief of PricewaterhouseCooper's Washington tax practice, said Obama's plan carefully opposed a "pure" territorial tax system, but left the door open for hybrid systems that might, for instance, exempt some but not all offshore profits from U.S. taxation.

"The use of the term 'pure' I think, was a signal that they were willing to consider it," Olson said.

Critics of moving to a territorial system say it will cause further U.S. jobs and business to move offshore.

A report by the Congressional Research Service, a nonpartisan think tank for lawmakers, this month said U.S.-based global companies are increasingly shifting profits into tax havens like Bermuda and Switzerland.

Critics say this proves companies are aggressively skirting the law to avoid U.S. tax. Business groups say the trend is the result of the relatively high U.S. tax rate.

TOUGH CHOICES

The notion of trimming the top corporate tax rate is a rare area of agreement between Democrats and Republicans on tax policy, though Republicans want to lower the rate more.

A major hurdle in any tax code revamp would be how to "broaden the base" of taxpayers, which both sides say is needed to help fund a tax rate cut. That would mean making hard choices about scrapping tax deductions, credit and loopholes that some companies hold dear.

Engler said his CEOs would be willing to give up some perks if it meant the corporate tax rate could be cut to 25 percent.

"There are credits for the way you handle depreciation, there are credits on R&D (research and development), there are credits on this type of manufacturing or this type of manufacturing product," he said. "They have to be on the table."

(Editing by Kevin Drawbaugh, Howard Golle, M.D. Golan and Andrew Hay)

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U.S. Vice President Joe Biden (L) and President Barack Obama (R) depart following Obama's remarks after the House of Representatives acted on legislation intended to avoid the ''fiscal cliff,'' at the White House in Washington January 1, 2013. The Republican-controlled House backed a tax hike on the top U.S. earners shortly before midnight on Tuesday, ending weeks of high-stakes budget brinkmanship that threatened to spook consumers and throw financial markets into turmoil.

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U.S. President Barack Obama and Secretary of State Hillary Clinton participate in a transfer ceremony of the remains of U.S. Ambassador to Libya, Chris Stevens and three other Americans killed this week in Benghazi, at Andrews Air Force Base near Washington, September 14, 2012. Ambassador Stevens and the other Americans died after gunmen attacked the lightly fortified U.S. consulate and a safe house refuge in Benghazi on Tuesday night.

WASHINGTON | Sun Dec 30, 2012 9:35am EST

WASHINGTON (Reuters) - The United States has some "very good leads" about who carried out the attacks in Benghazi, Libya, that killed four Americans including the U.S. ambassador in September, President Barack Obama said in an interview broadcast on Sunday.

Obama told NBC's "Meet the Press" that the United States would carry out all of the recommendations put forward in an independent review of the September 11 attack on the U.S. mission in Benghazi in which Ambassador Christopher Stevens was killed.

"We're not going to pretend that this was not a problem. This was a huge problem. And we're going to implement every single recommendation that's been put forward," Obama said in the interview, referring to security issues identified in the review.

"With respect to who carried it out, that's an ongoing investigation. The FBI has sent individuals to Libya repeatedly. We have some very good leads, but this is not something that I'm going to be at liberty to talk about right now," he said.

The interview was conducted on Saturday.

(Reporting by Jeff Mason; Editing by Will Dunham)

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US Democratic presidential candidate Senator Barack Obama (D-IL) (R) shares a laugh with Senator Chuck Hagel (R-NE) at the Amman Citadel in Amman July 22, 2008.

WASHINGTON | Sun Dec 30, 2012 12:12pm EST

WASHINGTON (Reuters) - President Barack Obama offered strong support for former Republican Senator Chuck Hagel as the potential next U.S. defense secretary but said in remarks aired on Sunday that he had not yet decided on a nominee for the Pentagon post.

Hagel is considered a leading candidate to replace outgoing Secretary of Defense Leon Panetta, but the former Nebraska lawmaker has come under criticism for his record on Israel and for a comment that being gay was an inhibiting factor for being an ambassador.

"I've served with Chuck Hagel. I know him. He is a patriot. He is somebody who has done extraordinary work both in the United States Senate, somebody who served this country with valor in Vietnam," Obama told NBC's "Meet the Press" in an interview taped on Saturday and broadcast on Sunday.

Any nomination for defense secretary must be approved by the Senate where some lawmakers have voiced criticism about their former colleague.

"I think a lot of Republicans and Democrats are very concerned about Chuck Hagel's positions on Iran sanctions, his views toward Israel, Hamas and Hezbollah, and that there is wide and deep concern about his policies. All of us like him as a person," Republican Senator Lindsey Graham said.

"There would be very little Republican support for his nomination, at the end of the day, there will be very few votes," Graham said on Fox News Sunday.

Republican Senator Tom Coburn from Oklahoma said bluntly: "I cannot vote for Chuck Hagel."

Aside from his controversial statements, "he does not have the experience to manage a very large organization like the Pentagon," Coburn said on CBS' "Face the Nation." "If there's a place that we need great management it's the Pentagon."

Senator Richard Durbin, a Democrat from Illinois, said on the same television show that Hagel deserved "respect for the service he's given our country in the military and in the Senate" and should be given consideration. "He at least deserves a hearing and an opportunity," he said.

Obama said he had seen nothing that would disqualify Hagel.

The president said Hagel had apologized for his comments related to homosexuality, referred to by NBC's David Gregory in the interview.

"With respect to the particular comment that you quoted, he apologized for it," Obama said.

"And I think it's a testimony to what has been a positive change over the last decade in terms of people's attitudes about gays and lesbians serving our country. And that's something that I'm very proud to have led," he said.

Obama came out in favor of gay marriage in the middle of his re-election bid this year. Earlier in his term he presided over the end of the "don't ask, don't tell" policy that prohibited gay men and women from serving openly in the U.S. military.

Hagel, who left the Senate in 2008, has faced questions about his record on Israel.

Some of Israel's leading U.S. supporters contend that Hagel at times opposed Israel's interests, voting several times against U.S. sanctions on Iran, and made disparaging remarks about the influence of what he called a "Jewish lobby" in Washington.

Obama, who has strained relations with Israeli Prime Minister Benjamin Netanyahu, has faced questions of his own from the American Jewish community about his approach to the U.S. ally.

Obama said Hagel was doing an "outstanding job" serving on an intelligence advisory board and gave no indication on when he would make his final decision about the defense chief job.

The president has already backed down once from a contentious nomination, choosing Democratic Senator John Kerry to replace Hillary Clinton as secretary of state rather than going with his presumed first choice, U.S. Ambassador to the United Nations Susan Rice, whom many Republicans opposed after she made controversial remarks about the September 11 attacks on a U.S. mission in Benghazi, Libya, that killed four Americans.

(Editing by Sandra Maler)

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U.S. President Barack Obama and first lady Michelle Obama visit military personnel and their families as they walk into Anderson Hall base chow hall at the Marine Corps Base Hawaii in Kaneohe Bay, Hawaii December 25, 2012.

WASHINGTON/HONOLULU | Wed Dec 26, 2012 7:30pm EST

WASHINGTON/HONOLULU (Reuters) - Efforts to prevent the U.S. economy from going over a "fiscal cliff" stirred back to life on Wednesday with less than a week to go before potentially disastrous tax hikes and spending cuts kick in at the New Year.

In a sign that there may be a way through deadlock in Congress, Republican House of Representatives Speaker John Boehner urged the Democrat-controlled Senate to act to pull back from the cliff and offered to at least consider any bill the upper chamber produced.

President Barack Obama will try to revive budget crisis talks - which stalled last week - when he returns to Washington on Thursday after cutting short his Christmas holiday in Hawaii.

But the White House and Republicans are still far apart, as hopes for legislation to prevent the economy from tumbling off the fiscal cliff switch to the Senate.

Democrats control a majority in that chamber but still need some support from Republicans across the aisle for a likely attempt to raise taxes on the wealthy.

A senior administration official told reporters traveling with Obama in Hawaii that senior Republican leaders in Congress, Senator Mitch McConnell and Boehner, should step up to head off the looming tax and spending hit.

"It's up to the Senate Minority Leader not to block a vote, and it's up the House Republican leader, the Speaker of the House ... to allow a vote," the official said.

Months of congressional gridlock on how reduce the deficit and rein in the nation's $16 trillion federal debt have begun to affect ordinary Americans.

Shoppers might have spent less this holiday season for fear of looming income tax increases and reports of lackluster retail holiday sales added to the urgency for a deal. U.S. stocks fell on Wednesday, dragged lower by shares of retail companies.

TREASURY BUYING TIME

To avoid defaulting on the national debt if the budget crisis spins out of control, the Treasury Department announced measures essentially designed to buy time to allow Congress to resolve its differences and raise the debt borrowing limit.

Obama flies back from Hawaii overnight and is due in the White House on Thursday morning.

Starbucks Chief Executive Howard Schultz is urging workers in the company's roughly 120 Washington-area coffee shops to write "come together" on customers' cups on Thursday and Friday to tell politicians to end the crisis.

"We're paying attention, we're greatly disappointed in what's going on and we deserve better," Schultz told Reuters.

Boehner and his House Republican leadership team said in a statement that "the Senate must act first."

That puts the ball in the court of the Democrats in the Senate, which is likely to base any legislation on a bill it passed earlier this year to continue tax breaks for households with incomes below $250,000.

A spokesman for Senate Majority Leader Harry Reid issued a strongly worded statement calling on Republicans to "drop their knee-jerk obstruction."

"The Senate bill could pass tomorrow if House Republicans would simply let it come to the floor," the spokesman said.

A Senate bill would likely contain an extension of expiring unemployment benefits for those who have been out of work for extended periods.

With the 435 members scattered throughout the country because the House is in recess, House Republican leaders scheduled a conference call for Thursday with members to possibly discuss bringing the chamber back into session to deal with the fiscal cliff.

The budget fight is not just about taxes, however.

The country faces $109 billion in across-the-board spending cuts starting in January unless a deal is reached to either replace or delay them. Democrats want to switch the spending cuts to tax increases for the most part.

House Republicans have passed a bill to stop the military portion of the spending cuts and place the entire burden on domestic activities, including some social safety net programs.

But the main focus is on how to stop tax hikes on January 1.

"This is the (emergency) scenario that we have long believed would rise in probability the closer we go to December 31, which essentially calls for extending all the rates for those individuals making under $200K and households under $250K and does not address the debt ceiling or the deficit," analyst Chris Krueger of Guggenheim Securities wrote in a research note.

Republican Senator Kay Bailey Hutchison of Texas, who is retiring at year's end, told MSNBC that $250,000 "is too low of a threshold" for raising income taxes.

RAISING TAX THRESHOLD

She said that in conversations she has had with some Senate Democrats, "they are saying maybe more in the $400,000 to $500,000 category."

Obama himself recently offered to raise the threshold to $400,000, before negotiations with Boehner broke off.

Boehner and other Republican leaders said in a statement that if the Senate sends the House new fiscal cliff legislation, "The House will then consider whether to accept the bills ... or to send them back to the Senate with additional amendments.

"The House will take this action on whatever the Senate can pass, but the Senate first must act."

But even if a handful of Senate Republicans support Democrats on a measure to avoid the worst of the fiscal cliff, time is short. When the Senate returns on Thursday it is due to work on a disaster aid bill to help New York and New Jersey recover from Superstorm Sandy and other measures.

All 191 House Democrats might have to team up with at least 26 Republicans to get a majority if the bill included tax hikes on the wealthiest Americans, as Obama is demanding.

Some of those votes could conceivably come from among the 34 Republican members who are either retiring or were defeated in the November elections and no longer have to worry about the political fallout.

An alternative is for Congress to let income taxes go up on everyone as scheduled. Then, during the first week of January, lawmakers would strike a quick deal to reduce them except on people in the highest brackets.

They could also pass a measure putting off the $109 billion in automatic spending cuts that most lawmakers want to avoid.

Once the clock ticks past midnight on December 31, no member of Congress would have to vote for a tax increase on anyone - taxes would have risen automatically - and the only votes would be to decrease tax rates for most Americans back to their 2012 levels.

(Additional reporting by Thomas Ferraro in Washington and Lisa Baertlein in Los Angeles, Writing by Alistair Bell)

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