Good morning. Here’s what you need to know:1. The New York Times reports: “Close to $2 of every $10 that went into Americans’ wallets last year were payments like jobless benefits, food stamps, Social Security and disability, according to an analysis by Moody’s Analytics. By the end of this year, however, many of those dollars are going to disappear, with the expiration of extended benefits intended to help people cope with the lingering effects of the recession. Moody’s Analytics estimates $37 billion will be drained from the nation’s pocketbooks this year.”
2. Talks between President Obama and Congressional leaders regarding deficit reduction and raising the debt ceiling continued yesterday at the White House. No progress was reported.
4. House Speaker John Boehner had hoped to negotiate the largest deficit reduction package in the nation’s history. He couldn’t sell it to his caucus. The deficit talks reset and are now much less ambitious.
5. defence Secretary Leon E. Panetta said on Saturday that the United States was “within reach of strategically defeating Al Qaeda.” He said the US has now narrowed its focus to capturing or killing 10 to 20 key leaders of the terrorist group in Pakistan, Somalia and Yemen.
6. National Journal reports: “The highest-ranking U.S. military officer (Admiral Mike Mullen) said on Thursday that Pakistan’s control over its nuclear weapons appears tight enough to protect against the possibility of seizure by extremist sympathizers who might infiltrate the nation’s army or intelligence service.”
7. Skirmishes along the Afghanistan-Pakistan border are threatening to mushroom into wider conflict between the two countries.
8. The United States has suspended hundreds of millions of dollars in military aid to Pakistan, citing “slackening support” by Pakistan for Washington’s fight against al Qaeda and the Taliban.
9. Italy is the new Greece. Eurozone finance ministers are meeting today to discuss Italy’s deteriorating debt situation.
10. Europeans were livid with Moody’s for its negative assessment of Portugal’s debt. Wolfgang Munchau writes that the ratings agency did the eurozone a big favour, by clarifying the breadth of the problem. He argues that the only thing that will save the eurozone is a Eurobond.
12. Rep. Michele Bachmann says she began her professional legal career as a “federal tax litigation attorney.” Which is to say: she worked for the IRS as a collection agent. It will be interesting to see how this piece of information sits with her Tea Party supporters.
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