McConnell warns GOP: Don't help re-elect Obama (AP)

By DAVID ESPO and ANDREW TAYLOR, Associated Press David Espo And Andrew Taylor, Associated Press – 4 mins ago

WASHINGTON – Failure to raise the U.S. debt limit would probably ensure President Barack Obama's re-election in 2012, Senate Republican leader Mitch McConnell warned fellow conservatives on Wednesday, fresh evidence of deep GOP political divisions on an issue of paramount importance to the nation and its economy.

McConnell spoke as Obama and congressional leaders met for a fourth straight day — struggling to avert an unprecedented government default threatened for Aug. 2 — and Moody's Investors Service announced it was reviewing the U.S. bond rating for a possible downgrade. Moody's cited a "rising possibility that the statutory debt limit will not be raised on a timely basis."

At the Capitol, rank-and-file lawmakers advanced their own fallback measures in case the bipartisan compromise talks fail.

One version, authored by Sen. Bill Nelson, D-Fla., was designed to make sure Social Security benefits are paid on time. Another, unveiled by a trio of House conservatives, would give priority to paychecks for members of the armed forces.

"Currently, there is not a single debt limit proposal that can pass the House of Representatives," House Majority Leader Eric Cantor, R-Va., said in a written statement. He said efforts should focus on "what we can agree upon" rather than Democratic demands for raising taxes or GOP calls to repeal the year-old health care bill.

Without an increase in government borrowing authority by Aug. 2, Treasury Secretary Tim Geithner has warned, there could be a default posing a catastrophic risk to the economy, still recovering from the worst recession in decades.

In a sobering reminder of the stakes, the Treasury Department announced that the federal deficit was on pace to exceed $1 trillion for the third consecutive year, and was likely to top last year's $1.29 trillion.

Moody's released its announcement after the U.S. financial markets had closed for the day, and cited fears of a default on U.S. Treasury debt obligations. Six weeks ago, the firm had announced that a rating review would be likely in mid-July unless there was meaningful progress in negotiations to raise the debt limit.

In a radio interview on the Laura Ingraham Show, McConnell predicted that if Congress fails to act, Obama will argue "that Republicans are making the economy worse and try to convince the public, maybe with some merit, if people start not getting their Social Security checks and military families start getting letters saying their service people overseas don't get paid."

"You know it's an argument he has a good chance of winning, and all of a sudden we (Republicans) have co-ownership of a bad economy. That is a very bad positioning going into an election," he said.

McConnell said his first choice was to reach a good compromise with Obama.

Short of that, "my second obligation is to my party ... to prevent them from being sucked into a horrible position politically that would allow the president probably to get re-elected because we didn't handle this difficult situation correctly."

At least in part, McConnell's comments were a rebuttal to conservatives who criticized his proposal on Tuesday to let Obama raise the debt limit without a vote of Congress.

Presidential hopeful Newt Gingrich called that idea an "an irresponsible surrender to big government, big deficits and continued overspending," and Ingraham said she had received emails from conservative listeners likening McConnell to Pontius Pilate.

The Republican lawmaker brushed aside the biblical reference. But without mentioning Gingrich by name, he referred to two government shutdowns of 1995 that the one-time House speaker engineered in hopes of winning deep spending cuts from a Democratic president.

The tactic backfired politically on Gingrich and the Republicans, and benefited President Bill Clinton.

A decade and a half later, some Republicans have set out on what could be a similar course on the debt limit, demanding huge deficit cuts — and no tax increases — as the price for approving an increase in borrowing authority.

Some Democrats couldn't resist the temptation to jab at them.

"You have the Republicans who walked out of the Biden talks. You have the speaker of the House who's close to entering into a framework agreement with the president of the United State walk out because other Republicans in the House undercut him," said Rep. Chris Van Hollen, D-Md., a participant in the talks led by Vice President Joe Biden.

"And now you have Republicans trashing a proposal put forward by the Republican leader in the Senate."

Despite an extraordinary commitment of time, the private talks at the White House have made little if any progress since Obama presided the first session on Sunday.

House Republicans said they would press the president in Wednesday's meeting to outline a deficit-prediction plan of his own.

Obama has said he is willing to take criticism from within his own party over program cuts in order to achieve a significant reduction in future deficits. But he also wants higher taxes that Republicans at the table say are unacceptable.

In advance of the day's meeting, officials said the negotiators would probably turn their attention to cuts that had been proposed in the earlier negotiations in the Capitol led by Biden. Participants in those talks disagree about precisely how much they had agreed to, however, and it was unclear what the prospects were for agreement.

With hopes for a bipartisan deal dimmed, backup proposals proliferated.

Senate Majority leader Harry Reid, D-Nev., has not rejected McConnell's proposal, and officials say he is developing one of his own to create a commission that could recommend deficit cuts and be assured that Congress would vote on them.

Nelson's proposal was designed to ensure that Social Security recipients receive their checks in the event of a default, mandating that the program's obligations no longer count against the overall debt limit.

He acted one day after Obama cautioned that he could not guarantee the checks would go out if there was a default.

On the other side of the Capitol, Republican Reps. Steve King of Iowa, Louie Gohmert of Texas and Michele Bachmann of Minnesota, a presidential candidate, said if the debt ceiling is reached, the Treasury should fund pay any allowances for members of the Armed Forces first and obligations on the public debt second, ahead of all other expenses.

Congressional Republicans have had a relatively muted response to McConnell's debt limit proposal. Privately, though, conservative lawmakers have been critical, accusing him of giving up the leverage the GOP has to force Obama into making deep spending cuts as the price for an increase in the debt limit.

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Associated Press writers Jim Kuhnhenn, Laurie Kellman, Ben Feller and Christopher Rugaber contributed to this story.

UN warns US over Texas execution

8 July 2011 Last updated at 20:11 GMT Leal's friends and family in Mexico were told about his death moments after the execution The US breached international law when the state of Texas executed a Mexican citizen convicted of raping and killing an American girl, the UN's senior human rights official has said.

Navi Pillay cited "particular legal concerns" whether Humberto Leal Garcia, 38, had access to consular officials and a fair trial.

US Secretary of State Hillary Clinton also said she was "disappointed" that Texas carried out the lethal injection.

Leal was executed late on Thursday.

He was not told he could have access to Mexican consular officials, in violation of the Vienna Convention.

"US compliance with Vienna convention terms is absolutely critical to ensuring our own consular access and our own ability to protect Americans detained abroad," State Department spokeswoman Victoria Nuland said.

Ms Nuland said not protecting "the rights of non-Americans in the United States" could lead to a lack of US access to American citizens overseas in the future.

"This is why the secretary is concerned," she added.

Ms Pillay, the UN High Commissioner for Human Rights, who visited Mexico this week, said Texas had placed "the US in breach of international law".

Humberto Leal was born in Mexico but came to the US as a small child

"What the state of Texas has done in this case is imputable in law to the US and engages the United States' international responsibility," she said.

Ms Pillay said Texas Governor Rick Perry, who rejected requests to intervene, and the Texas Board of Pardons and Paroles each failed to exercise consular and fair-trial obligations.

Those obligations fall under the Vienna Convention on Consular Relations and an International Covenant on Civil and Political Rights, she added.

She suggested the issue could reach the International Court of Justice and said "ramifications are likely to spread far beyond Texas".

Supreme Court rejection

Humberto Leal Garcia was sentenced to death for the 1994 rape and murder of 16-year-old Adria Sauceda, whose body was found unclothed and beaten, hours after she was seen leaving a party with Leal in San Antonio.

Leal's lawyers, the Mexican government and foreign diplomats sought a stay in the sentence.

The Obama administration had also wanted the US Supreme Court to grant a stay.

That would have allowed Congress to consider legislation covering foreign nationals who were not given proper consular access before being tried for crimes that carry the death penalty.

But the court rejected the request by the narrowest of margins, 5-4, a little more than an hour before Leal was put to death.

The Mexican government said prior to the execution that the nation regarded it as a violation of international law.

Afghan drawdown creates risk, U.S. military warns (Reuters)

WASHINGTON (Reuters) – The U.S. military warned on Thursday that President Barack Obama's faster-than-expected drawdown in Afghanistan created new risks, even as commanders said they backed the strategy to start winding down the unpopular, nearly decade-old war.

Admiral Mike Mullen, chairman of the U.S. military's Joint Chiefs of Staff, told the U.S. Congress that Obama's plans to withdraw nearly a third of the some 99,000 U.S. troops in Afghanistan by the end of next summer was a riskier plan than he had wanted. Obama announced the withdrawal timetable on Wednesday.

"The president's decisions are more aggressive and incur more risk than I was originally prepared to accept," Mullen told a House of Representatives committee hearing in his first comments on Obama's plan.

Mullen later said the risks were still manageable and would not by themselves jeopardize the overall military mission.

His comments, while carefully phrased, were an unusually public expression of the Pentagon's initial unease with Obama's aggressive Afghan drawdown. In the run-up to Obama's decision, military leaders lobbied privately for more time, and outgoing Defense Secretary Robert Gates publicly said any troop withdrawal should be modest.

Secretary of State Hillary Clinton acknowledged "lots of competing opinions coming at (Obama) from all sides." She, too, said she supported his decision.

In Kabul, Afghan President Hamid Karzai, Washington's ally in a relationship made tense by allegations of incompetence and corruption, welcomed the plan for a gradual pullout and said Afghans increasingly trusted their security forces.

European nations that have contributed troops to the military effort against the Afghan Taliban insurgency said they would also proceed with already-planned phased reductions.

But the Taliban, resurgent a decade after being toppled from power by U.S.-led forces following the September 11 attacks, dismissed the announcement and said only a full, immediate withdrawal of foreign forces could stop "pointless bloodshed."

They rejected any suggestion of U.S. military gains.

'RUSH TO THE EXITS'?

In a prime-time televised appearance on Wednesday, Obama said he would withdraw 10,000 troops from Afghanistan by the end of 2011, and a further 23,000 by the end of next summer. Remaining troops would be steadily withdrawn after that.

Nearly 70,000 U.S. soldiers will, however, remain in Afghanistan even after the cuts announced by Obama, about twice the number when he took office in January 2009.

Obama's decision divided Congress, with some lawmakers demanding a more rapid pullout and others branding Obama's drawdown as a dangerous political move to appease his Democratic base ahead of the 2012 presidential election.

Senator John McCain, a Republican who lost to Obama in the 2008 election, said "I think we're taking a huge unnecessary risk."

Republican Senator Charles Grassley called the pullout pace "very dangerous" and said he understood that General David Petraeus, the overall commander in Afghanistan, had recommended a slower withdrawal than the one Obama announced.

"The president's only consideration in all of this should be what is best for our national security, not finding some halfway point" with war critics, Grassley told Reuters.

But Undersecretary of Defense Michele Flournoy, appearing at the committee hearing alongside Mullen, said, "Clearly, this is not a 'rush to the exits' that will jeopardize our security gains."

Mullen also played down the possibility that security gains could be easily reversed. Bringing home troops offered some benefits, he said, including reinforcing the goal of putting Afghans in control of their own security by the end of 2014.

"The truth is, we would have run other kinds of risks by keeping more forces in Afghanistan longer. We would have made it easier for the Karzai administration to increase their dependency on us," Mullen said.

The Taliban has been pushed out of some areas of their southern heartland, but the insurgency has intensified along Afghanistan's eastern border with Pakistan and U.S. commanders have wanted to shift their focus to that area.

Still, Clinton, appearing separately before a Senate committee, acknowledged there was no military solution to the conflict and said the United States had a broad range of contacts in search of a political resolution.

Asked by Senator Jeanne Shaheen, a Democrat, if there was a possibility for a peace agreement with the Taliban, Clinton said, "I think there is, but I think that we're a long way from knowing what the realistic elements of such an agreement would be."

"I can only stress that we are committed to pursuing it, because it is the only path forward, there is no other path forward. Nobody is strong enough to really assert control," she said.

In another sign of the challenges ahead in transferring control to Afghan authorities, an Afghan court on Thursday overturned a quarter of the results from last year's fraud-tainted parliamentary election -- potentially plunging the country into a new political crisis.

Afghanistan has been in a state of political paralysis since the September 18 election, with a full cabinet still not in place after weeks of squabbling.

EUROPEANS CALL FOR GRADUAL PULLOUT

As the U.S. withdraws, so will its allies. France, Germany, Poland and Spain said they would proceed with a gradual drawdown.

French President Nicolas Sarkozy, like Obama seeking re-election next year, said in a statement that he would oversee a pullout "in a proportional manner and in a calendar comparable to the withdrawal of American reinforcements." France's 4,000-strong contingent is the fourth largest in Afghanistan.

German Defense Minister Guido Westerwelle said his country, with 4,800 troops in the increasingly violent north, hoped "to be able to reduce our own troop contingent for the first time" by the end of the year.

(Additional reporting by David Alexander, Susan Cornwell, Missy Ryan and Jim Wolf in Washington; David Brunnstrom in Brussels and Paul Tait and Hamid Shalizi in Kabul; editing by Sanjeev Miglani and Mohammad Zargham)

Cameron warns over Greek funding

23 June 2011 Last updated at 20:00 GMT Mr Cameron says the funds must come from the eurozone David Cameron has told European Union leaders that the UK will oppose using EU-wide money to bail-out Greece.

The current 110bn euros ($156bn; £98bn) Greek rescue package is a combination of funds from fellow eurozone nations and the International Monetary Fund.

Yet, after eurozone countries agreed in principle to give Greece an extra 120bn euros, there is a suggestion that cash from EU-wide funds may be used.

The prime minister said such funds should not be used in any way.

Key vote

Mr Cameron made the comments at the summit of EU leaders in Brussels. They reiterate previous statements by Chancellor George Osborne.

At present the UK government has contributed to the existing bail-out for Greece through the funds it gives the IMF.

The eurozone money being given to Greece currently comes from the European Financial Stability Facility, to which only the 17 eurozone nations contribute.

Continue reading the main story June 28: Greek parliament to debate new austerity packageJuly 3: Eurozone deadline: will sign off latest bail-out payment to Greece - 12bn euros - if austerity package has passedJuly 15: Default deadline: Without the 12bn euros it needs to make debt repayments, Greece will defaultThe UK contributes to the wider European Financial Stabilisation Mechanism, which covers the whole of the EU.

The Greek parliament will vote next week on the government's latest round of spending cuts.

If the vote goes through, then Greece will get the next 12bn euros instalment of the current 110bn euros of eurozone and IMF funds.

Greece needs this month by 15 July, or else it will default on its loan payments.

However, many economists think that even if Greece gets the latest 12bn euros it will still default at some time in the future.

While Greece's continuing debt woes are dominating the EU summit, the question of who exactly contributes to any second giant Greek bail-out fund later in the year is unlikely to be decided.

Instead, the 27 EU leaders are expected to reaffirm their more general determination to help Greece sort out its problems, while defending the single currency.