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Archive for June, 2008

We’ve talked about Socialized Health care a few times, pointing out the obvious failures of it. No matter what country its in, it sucks. Well here is some more for those that still think that the ‘Change’ we need is towards a system that even its architect says is a failure!

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Canadian Health Care We So Envy Lies In Ruins, Its Architect Admits

As this presidential campaign continues, the candidates’ comments about health care will continue to include stories of their own experiences and anecdotes of people across the country: the uninsured woman in Ohio, the diabetic in Detroit, the overworked doctor in Orlando, to name a few.

But no one will mention Claude Castonguay — perhaps not surprising because this statesman isn’t an American and hasn’t held office in over three decades.

Castonguay’s evolving view of Canadian health care, however, should weigh heavily on how the candidates think about the issue in this country.

Back in the 1960s, Castonguay chaired a Canadian government committee studying health reform and recommended that his home province of Quebec — then the largest and most affluent in the country — adopt government-administered health care, covering all citizens through tax levies.

The government followed his advice, leading to his modern-day moniker: “the father of Quebec medicare.” Even this title seems modest; Castonguay’s work triggered a domino effect across the country, until eventually his ideas were implemented from coast to coast.

Four decades later, as the chairman of a government committee reviewing Quebec health care this year, Castonguay concluded that the system is in “crisis.”

“We thought we could resolve the system’s problems by rationing services or injecting massive amounts of new money into it,” says Castonguay. But now he prescribes a radical overhaul: “We are proposing to give a greater role to the private sector so that people can exercise freedom of choice.”

Castonguay advocates contracting out services to the private sector, going so far as suggesting that public hospitals rent space during off-hours to entrepreneurial doctors. He supports co-pays for patients who want to see physicians. Castonguay, the man who championed public health insurance in Canada, now urges for the legalization of private health insurance.

In America, these ideas may not sound shocking. But in Canada, where the private sector has been shunned for decades, these are extraordinary views, especially coming from Castonguay. It’s as if John Maynard Keynes, resting on his British death bed in 1946, had declared that his faith in government interventionism was misplaced.

What would drive a man like Castonguay to reconsider his long-held beliefs? Try a health care system so overburdened that hundreds of thousands in need of medical attention wait for care, any care; a system where people in towns like Norwalk, Ontario, participate in lotteries to win appointments with the local family doctor.

Years ago, Canadians touted their health care system as the best in the world; today, Canadian health care stands in ruinous shape.

Sick with ovarian cancer, Sylvia de Vires, an Ontario woman afflicted with a 13-inch, fluid-filled tumor weighing 40 pounds, was unable to get timely care in Canada. She crossed the American border to Pontiac, Mich., where a surgeon removed the tumor, estimating she could not have lived longer than a few weeks more.

The Canadian government pays for U.S. medical care in some circumstances, but it declined to do so in de Vires’ case for a bureaucratically perfect, but inhumane, reason: She hadn’t properly filled out a form. At death’s door, de Vires should have done her paperwork better.

De Vires is far from unusual in seeking medical treatment in the U.S. Even Canadian government officials send patients across the border, increasingly looking to American medicine to deal with their overload of patients and chronic shortage of care.

Since the spring of 2006, Ontario’s government has sent at least 164 patients to New York and Michigan for neurosurgery emergencies — defined by the Globe and Mail newspaper as “broken necks, burst aneurysms and other types of bleeding in or around the brain.” Other provinces have followed Ontario’s example.

Canada isn’t the only country facing a government health care crisis. Britain’s system, once the postwar inspiration for many Western countries, is similarly plagued. Both countries trail the U.S. in five-year cancer survival rates, transplantation outcomes and other measures.

The problem is that government bureaucrats simply can’t centrally plan their way to better health care.

A typical example: The Ministry of Health declared that British patients should get ER care within four hours. The result? At some hospitals, seriously ill patients are kept in ambulances for hours so as not to run afoul of the regulation; at other hospitals, patients are admitted to inappropriate wards.

Declarations can’t solve staffing shortages and the other rationing of care that occurs in government-run systems.

Polls show Americans are desperately unhappy with their system and a government solution grows in popularity. Neither Sen. Obama nor Sen. McCain is explicitly pushing for single-payer health care, as the Canadian system is known in America.

“I happen to be a proponent of a single-payer health care program,” Obama said back in the 1990s. Last year, Obama told the New Yorker that “if you’re starting from scratch, then a single-payer system probably makes sense.”

As for the Republicans, simply criticizing Democratic health care proposals will not suffice — it’s not 1994 anymore. And, while McCain’s health care proposals hold promise of putting families in charge of their health care and perhaps even taming costs, McCain, at least so far, doesn’t seem terribly interested in discussing health care on the campaign trail.

However the candidates choose to proceed, Americans should know that one of the founding fathers of Canada’s government-run health care system has turned against his own creation. If Claude Castonguay is abandoning ship, why should Americans bother climbing on board?

Prepare folks.
Universal health care is coming.
If and when Obama wins he will get it passed with the help of the Democrat party in Congress.

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Speaking Democrat

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Over the years I have found out that I tend to be fiscally conservative and socially moderate. That means, of course, that neither party has much use for me. Not socially conservative enough for the Republicans and definitely not liberal enough for the Democrats. Heck, I have absolutely no reason to vote for Obama and I suspect he has absolutely no intention of doing anything for me other than making me, my income, and my success into one of the bigger problems in America requiring “change”. I’ve learned to live with it and over time, the country tends to plow a middle of the road course which suits me just fine. So why wouldn’t I be for drilling in ANWAR and shooting every ecoweeny on sight? It’s not difficult to understand but it does take a little bandwidth.

I do run a business and I am a physicist by training which means I prefer to view reality for what it is, and not delude myself into believing there is alternate reality just around the corner. So here is reality one, we aren’t going to pay the deft off. Without up to the nanosecond calculation, let’s say the debt is four trillion dollars. Let’s also say that the Democrats and the Republicans arrive at a new view of life and become fast friends. Let’s say that they trim spending and generate a $400 million surplus. They would have to keep things that way for maybe twelve years to pay the debt off, with interest. And the voting taxpayers would have to make the agreement that they will be happy paying their tax burden with no expansion of any programs to pay the debt off. My view – it will never happen. I don’t think we will ever have a government that could consistently generate a $400 million surplus and even if they did, we’d kick them all out of office if they didn’t either expand programs people want or cut taxes.

Social Security is in about the same boat. I don’t want to get into the debates of the SS funds going into the general fund and one part of the gov writing another part of the gov an IOU or the fact that the program pays out more than it takes in. I have my own ideas about how we could make some progress on it but, in truth, I doubt anything will change. For elected officials, SS is a third rail. Propose cuts and you’re not long for office. Obama wants to increase the level of contribution, almost certainly without proportionate return for those who will be required to make the contribution, but I doubt that his increase will do anything other than play accounting sleight of hand and make things appear better for a longer period of time. But he won’t fix anything.

So why do I bring those issues up when I say I am against drilling in ANWAR? The other part of reality is that some of you reading this are going to pay for my retirement just like I have paid for your parents and grandparents retirement by my payments to SS and taxes for civil servant retirement. And your children are going to pay for yours, and so on. At the same time, the gov will keep increasing the debt and the borrowing will get more expensive – those developing countries are going to find that they can buy their own bonds to build their own roads instead of buying ours so our costs will go up. I view the US oil reserves, whether you talk about ANWAR or shale or any other resource that, with technology development, will be available to those children and grandchildren that pay off the bills they accrue as well as the ones we leave to them. I don’t mean to diminish the suffering that people are suffering today with the increase gas prices but we are handling it. There are people that are seeing 15% of their income go to just gasoline and that is a tragedy in the making. For all the squealing of the conservatives playing “I told you so” about not opening up ANWAR they don’t seem to have any interest in anything other than today’s balance sheet. We are feeling the pain with oil at $130/barrel. What happens when it gets to $230 or $330/barrel? Regardless of whether you think today’s prices are driven solely by speculation or not, I can guarantee we will get to those prices for oil eventually. So, as long as anyone is willing to sell us oil and we can somehow make it work, let’s make it work. Transportation costs are going to go up and maybe not come down. After years of everyone telling me how stupid I was for keeping a manufacturing facility in the continental US, some of the brightest guys in the room are starting to bring their manufacturing, and the jobs, back here to the US because of transportation costs. WSJ had an article just yesterday on that. Fortunately, the company hadn’t held the auction and sold their manufacturing equipment off at 10 cents on the dollar so they have one leg up bringing their manufacturing back home from China. But eventually we may get to the point where people won’t sell oil, at any price, but keep it for their own uses. And that is a much different situation. I don’t have a problem with sitting on significant oil reserves at that time. Hopefully, at that time, the ecoweenies will not be able to make much of a case for using our reserves. Maybe we can remind them of what they did to food prices with  their perfect solution of ethanol. No, let’s debate and wrangle and get whatever sound bites there are to get but let’s leave those oil reserves to future Americans. It’s little enough for having them pay off our bills.

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News Link

RALEIGH, North Carolina (Reuters) – Democratic presidential candidate Barack Obama said on Monday he would impose a windfall profits tax on U.S. oil companies as he sought political gain from Americans’ pain over high gasoline prices.

Launching a two-week focus on the economy after clinching the Democratic presidential nomination, Obama drew a sharp contrast between his economic policies and those of John McCain, his Republican rival in the November election.

“I’ll make oil companies like Exxon pay a tax on their windfall profits, and we’ll use the money to help families pay for their skyrocketing energy costs and other bills,” the Illinois senator said.

Obama charged that McCain’s support for extending President George W. Bush’s tax cuts means he is in favor of $2 trillion in corporate tax breaks, including $1.2 billion for Exxon Mobil Corp.

“If John McCain’s policies were implemented, they would add $5.7 trillion to the national debt over the next decade. That isn’t fiscal conservatism, that’s what George Bush has done over the last eight years,” Obama said.

Recently on Money.com the Shell CEO said this: “If our profits are taxed, that means we’ll have less capital to invest in new production” and it could raise gas prices.

In that same Article from Money.com it mentions how over a period of 3 years (2003-2006) oil companies spent LESS on oil exploration. The reasons are pretty clear. Its not cheap to drill in deep ocean. Not to mention that the easy oil is restricted heavily here in the US.

Lets go back to this tax thing. Because it seems like Democrats solutions for everything is to institute a tax on everything. It doesn’t matter what it is. The solution is to tax the crap out of it, have more money to spend and well, spend it.

Someone needs to have the answer on this. Maybe someday Obama will.
Please explain to me what is a ‘Windfall profits tax’?
What will be the level that determines a ‘Windfall’?
What is the percentage of this out of the blue tax?
Will this tax be assessed only to Oil companies?
Why no Google with is BILLIONS for really doing nothing. They sell clicks on a search engine. They don’t really MAKE anything. Its the internet its already there, they just make it so you can search easier. How about Visa, will you windfall profit tax them too? Or farmers that have seen a spike in their earnings from global food prices doubling and tripling.
Or is this another one of those, lets say some crap to make voters vote for me, but they mean nothing speeches.

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Tipping Points

If you haven’t read it, Malcolm Gladwell’s book “The Tipping Point” sort of set the stage for a new view of economic events and if you have some free time, it’s worth a read. I have been mulling over this post for some time but this week just has to be analyzed, especially in its relation to the larger picture. And especially what it means for the individual. I have said that I put about half my cash back to work some time ago and I have. Now, there have been times in the last few weeks that I was sorry that I didn’t spend more time looking at my investments but as I work for a living, my day job has just gotten too busy. And then this week happens. Let’s see, two days ago, more or less, we had oil at $122/bbl and the market had gotten up to 12,600. The talking heads were tripping over themselves to predict that if oil broke through 120, it would be in free fall and the market would rocket. Recession? What recession as Kudlow would say? Well, just because we haven’t had the classical definition met doesn’t mean it’s safe to go back in the water. Oil finished the week at roughly $139/bbl and the market fell to around 12,200. OK, so that’s the facts.

Earlier in the week, people might have been convinced that we were at a tipping point for the economy to head higher. Oil in a nice steady decline, markets in a nice steady uptick, and, maybe most important, lack of bad news. Yesterday everybody with the attention span of a gerbil probably thought the big news for this weekend was Hillary taking the “Kick Me” sign off her pants suit and dropping out of the event. Gerbils unite, it’s a non event and should be treated as such. But that’s off the track. Were we at a tipping point? I don’t think so. Wall Street hates uncertainty because it means they aren’t the brightest guys in the room. As long as every future event replays as a past event, they can look like geniuses. With apologies to Peter Bernstein (Against the Gods, the story of risk – a much better book than The Tipping Point) events don’t replay out in exact detail. And the fact that they don’t has been named risk. My posts on Risk of Recovery are a spin on that. But the biggest factor you could point to earlier this week was that everyone felt the bad news was pretty much all out there. Could that make a tipping point? Not much of one IMO. Most people have learned not to chase the market but it is hard to resist when you watch it going up and the smartest guys in the room are saying “Buy now”. About the only real tipping point you have is the age old one between fear and greed.

There are enough questionable factors going on to make me believe we were not at a tipping point for the upside. OK, I know this is hindsight and that it is 20/20 but I felt that earlier in the week as well, take my word for it. I couldn’t quite understand the US consumer being back at it. Good numbers from Wal Mart and Costco just aren’t enough for me. I don’t see much job growth going on. I am hiring now but we are in an unusual circumstance and I am not going overboard as a business owner. And I see a lot of people out of work or underemployed. What’s the difference between underemployed and employed? Expectations. I am afraid that a lot of the resumes we have for engineers are from people who simply won’t be able to make a living as an engineer and will inevitably have to change careers to live. That’s just the state of business in the US. I don’t get the sense that the consumer is also going to bounce back because of the stimulus checks. I know we don’t have the numbers yet but at least in April, consumer debt took a nice pop. That’s not the sign that people have lowered their standard of living and can only consume based on what they earn. They still have plastic. Maybe they are counting on the gov bailing them out from their credit card bills and their mortgages? That is not good enough for a tipping point to expansion. I bought some Apple a while back when it was in the 130s and I was looking to increase the position but it got away from me. Now, I don’t consider Apple a tech stock. It’s a retail stock as far as I am concerned. So is there enough demand for iPods and iPhones to keep it going up from the 180s? I think it would be healthy if it retreated from here as the retail demand is going to soften going forward for a few months. It is really getting close to what I consider priced for perfection given the current economy.

Energy is not under control. I was convinced that we would see $5/gal here in NoCal this summer and I think I was wrong. The question is going to be how much over $5/gal we are going to see. The consumer isn’t through feeling this pain yet. And in my informal survey, especially as gas price stabilizes at all, the SUVs and mega trucks are still out there. Of course all of them are people who need them for work and they suffer terribly. Funny thing is, the majority of the pickup beds I see are empty, just like the front seat except for the driver. And having lunch on Wednesday I was able to watch three women pull up to the parking space outside the window of the restaurant and disembark from their GMC Denali behemoth after successfully docking it. I am sure these are three very nice ladies. Driving that Denali to lunch was ridiculous just as the notion that somebody needed a vehicle that size because they have a kid that plays soccer. Energy may not impact any industry more than the airlines. Unfortunately for the leisure traveler, they have finally figured out how to raise fares. No, not by charging you for pillows or fresh air but by “retiring” aircraft. I believe United started it, sorry if that is wrong, and now everybody is sliding right along. They ditch the planes, especially the less fuel efficient ones and they can naturally cut routes. Live in a small city that has commercial airline service? I wouldn’t count on it for too long. My contacts say that the airlines think this strategy is working and are hoping to have airfares a year from now up 25 to 30% from todays. Those doe eyed people who say “How am I going to go see Grandma in Orlando” are in for a big surprise. The surprise is you aren’t entitled to see granny. If you’ve got the bucks, and the best thing you can think to do with them is see granny, you get to go. Otherwise, move closer if you want to see her. Oh, and the real layoffs for the airlines haven’t started yet. They have done some reduction in salaried workers but my guess is the union workers are in for a very nasty, and big shock coming up.

Employment was not down as much as expected but the unemployment rate is higher than expected. Now, I believe that Benny and the Feds are on hold until they see the effect of the stimulus checks and that isn’t until third quarter at the earliest. Well, third quarter starts in July so they get to see. If the economy is softening, and the feeling is there might be an interest rate cut or two left in the Fed, the dollar weakens more, and oil goes up. Speculators might have made a lot of money this week. I have a feeling they also lost a lot of money this week. Funny how those who are just convinced that speculators are responsible for the price of gas simply cannot come to terms with the fact that you can lose big time playing commodities in just 24 hours. Why hasn’t oil stabilized? I mean come on, we know now Obama is the heir apparent and his “change” means things will have to get better? It is interesting that the knock on McCain is he doesn’t understand the economy. A relative novice who is a lawyer by trade just has to understand economics better because he doesn’t have anything to do with Bush? Not so quick. Few people here know me, other than some of the CL guys, but believe me, I am an equal opportunity critic of both parties. Last night, an official of the Israeli government does what Israelis often do and said that this UN nonsense is doing nothing to handle the nuclear threat from Iran and that if something more concrete doesn’t happen, they will take care of it. And they will use US support. Think you’re paying too much for gas now? Wait and see what an attack on Iran does. If I were the Israelis I would sure do it with the current administration. Duh. So that means this summer. If, and I hope that is a big if, an attack does come to curtail Iran’s nuclear ambitions, the prices for gasoline are going to shock a whole lot of people. You could easily see $7 or $8, maybe more, for a gallon of gas. It shouldn’t last for long but it will definitely rock the economy.

And then there is the election. I try to slant more econ in my posts and leave cp free to address the pol issues but then there is a reason why this is polyfispectrum. Joined at birth is a good analogy. If you believe Obama is going to win, without having to get into details, then you believe taxes will rise. With control of Congress and him in the WH there is nothing to stop their plans. Whether I feel tax increases are needed or not (I have to look at the proposed increases and what their revenue is intended for to decide) one thing I can tell you is that they are a galaxy class moronic idea with a fragile economy. No matter how many balloons you drop or how sure you are that you know what is better for everyone. There is an exquisite torture in this as well. The Dems really want a poor economy going into the election. Parties in power lose elections when the economy is in the toilet. But with a fragile economy, the last thing we will need is tax increases, even if only on who Obama, Nancy the P., and Barney Frank determine are the “rich”. Government policy on taxation in a poor economy is just like skippering a sailboat in light winds. You need to have a gentle touch on the tiller with no sudden moves. In a perverse turn, I could say that the government that does least does best in a poor economy. That would justify a vote for McCain and a sincere hope that it is enough to induce gridlock for at least a year or two. But is the election a reason to believe that we are near a tipping point for an economic recovery? Not in my book.

Whether you think we have set a double bottom now and oil is heading back up or not doesn’t make much difference. I believe the risks of downside on oil (increased oil prices) are greater than the risks of economic recovery and upside. And the Feds are probably going to become much less meaningful going forward. I wouldn’t think that there is unanimous support for Benny Bs power grab and Bear Stearns bailout. Politicians are always on the side of the guy that is perceived to have made the right policy decision. But they will also turn like a pack of wild dogs when they smell votes to be made by throwing the Fed, or at least Benny, under the train. And even within the Fed there are disagreements over the expanded role they have assumed. An interesting note is that the gov who presents inflation rates also determines how they are calculated. And they have changed. If you calculate inflation using the math used during Regan’s administration, inflation is running about 11% right now. I don’t have the reference for that but it was from a source I respect so I didn’t feel the need to research it much other than to know he was right on the changes. And that inflation is going to outstrip any other government cooked numbers on productivity gains to make everyone feel better. As for the rest of that cash I have, well I am not convinced that the better opportunity to put the rest back to work in equities is now. I think I can wait for a better opportunity or at least better indicators.

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That is the main point now in the global ‘climate change’ cause.

WELLINGTON (AFP) – The president of the low-lying Pacific atoll nation of Kiribati said Thursday his country may already be doomed because of climate change.
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President Anote Tong said communities had already been resettled and crops destroyed by seawater in some parts of the country, made up of 33 coral atolls straddling the equator.

Although scientists are still debating the extent of rising sea levels and their cause, Tong told a press conference marking World Environment Day that changes were obvious in his country of 92,000 people.

“I am not a scientist but what I know is that things are happening we did not experience in the past,” Tong said.

“We may be beyond redemption, we may be at the point of no return where the emissions in the atmosphere will carry on to contribute to climate change to produce a sea-level change that in time our small low-lying islands will be submerged,” he said.

“Villages that have been there over the decades, maybe a century, and now they have to be relocated.

“Where they have been living over the past few decades is no longer there, it is being eroded.”

At international meetings others had argued that measures to combat climate change would hurt their countries’ economic development.

“In frustration, I said, ‘No, it’s not an issue of economic growth, it’s an issue of human survival.'”

Under the worst-case scenario, Kiribati would be submerged by the end of this century and its people would have to be resettled in other countries, he said.

This may be a crazy assessment but I am almost POSITIVE that islands have been consumed by the sea over the last 1 Million years. So this is nothing new.

Then we have a water shortage:

News Link

A catastrophic water shortage could prove an even bigger threat to mankind this century than soaring food prices and the relentless exhaustion of energy reserves, according to a panel of global experts at the Goldman Sachs “Top Five Risks” conference.

Nicholas (Lord) Stern, author of the Government’s Stern Review on the economics of climate change, warned that underground aquifers could run dry at the same time as melting glaciers play havoc with fresh supplies of usable water.

“The glaciers on the Himalayas are retreating, and they are the sponge that holds the water back in the rainy season. We’re facing the risk of extreme run-off, with water running straight into the Bay of Bengal and taking a lot of topsoil with it,” he said.

“A few hundred square miles of the Himalayas are the source for all the major rivers of Asia – the Ganges, the Yellow River, the Yangtze – where 3bn people live. That’s almost half the world’s population,” he said.

Now wouldn’t the problem actually be OVER POPULATION not water run off?
And where is this water disappearing to?
So the new eco boogeyman will be not enough water because it evaporated.
Now if my basic JHS science memory serves me right, the evaporation of water turns into rain somewhere else. So this water isn’t just vanishing.

So before my concern should have been that my kids would be swimming in some ‘waterworld’ type world but now it should be that they won’t have enough water to drink either? Seriously? What is next, I should be worrying about low level clouds?

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A court martial on Wednesday acquitted a US Marine for his role in the deaths of 24 civilians in Haditha in Iraq in 2005, the sixth man to be exonerated in the affair, a military official said.

Lieutenant Andrew Grayson, 27, was declared “not guilty on all charges” by a jury, said a spokesman for the Camp Pendleton military base in southern California where the hearing started on May 28.

Grayson had been charged with making false statements and attempting to fraudulently separate from the Marine Corps. He was also charged with obstruction of justice, but the military judge dismissed this charge Tuesday.

He was the first Marine to stand trial in connection with the killings of 24 men, women and children in Haditha, the most serious war crime allegations leveled at US forces since the 2003 invasion to topple Saddam Hussein.

On November 19, 2005, a US soldier on patrol was killed by a roadside bomb in the village of Haditha, 260 kilometers (160 miles) west of Baghdad.

Defense lawyers claim insurgents hidden in nearby houses subsequently opened fire on the soldiers, forcing them to respond.

But prosecutors say there were no insurgents, alleging that the soldiers opened fire unprovoked in revenge for their colleague’s death.

In a three-hour shooting spree, they say, the soldiers shot five passengers of an approaching taxi and killed 10 women and children at point blank range, among others.

The Marines said in a press release issued immediately after the killings that 15 Iraqis had been killed by the roadside bomb that claimed the life of Lance Corporal Miguel Terrazas.

A subsequent investigation by Time magazine showed that most of the dead were killed as Marines swept through three houses near the bombing, prompting a wide-ranging internal investigation.

Eight military personnel were originally charged over the incident — four soldiers faced murder charges and four officers, including Grayson, were accused of covering up and failing to properly investigate the killings.

However, since charges were first announced in December 2006, prosecutors have struggled to make the allegations stick.

Six have now had charges against them dropped, while charges of murder against squad leader Frank Wuterich were changed to the lesser offense of manslaughter.

Wuterich faces trial later this year, along with Colonel Jeffrey Chessani, the highest ranking officer accused over the incident who has been charged with dereliction of duty and violation of a lawful order.

Wuterich told a preliminary hearing at Camp Pendleton last September that he would “always mourn the unfortunate deaths of the innocent Iraqis who were killed during our response to that attack.”

But he said: “Based on the information I had at the time, based on the situation, I made the best decision I could have.”

Here is the question moving forward though.
Should senator John Murtha face charges for his comments back in 2006?

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