Court Rules Franken Has Won Senate Race; Coleman Concedes
By Kate Phillips
Copyright by The New York Times
June 30, 2009, 4:18 pm
http://thecaucus.blogs.nytimes.com/2009/06/30/court-rules-franken-has-won-senate-seat/?hp
Updated The Minnesota Supreme Court has just issued its long-awaited judgment in the Senate race, declaring that Democrat Al Franken is the winner. And Norm Coleman, his opponent, at 4 p.m., announced that he had conceded and contacted Mr. Franken.
The 32-page unanimous decision by the state’s highest court was released after a seven-months long battle over the seat formerly held by Norm Coleman. On every ground, the judicial panel rejected Mr. Coleman’s claims of trial errors or constitutional violations, and decided that Mr. Franken’s election should be certified by the state as valid.
Mr. Coleman stepped outside his home just a short while ago to give his news conference. He indicated that he and Mr. Franken had a positive, personal talk and he told the Democrat that being senator was the “best job he’ll ever have.”
The Republican’s statement began this way: “Ours is a government of laws, not men and women. The Supreme Court of Minnesota has spoken and I respect its decision and will abide by the result. It’s time for Minnesota to come together under the leaders it has chosen and move forward. I join all Minnesotans in congratulating our newest United States Senator – Al Franken.”
With Mr. Coleman’s concession, Gov. Tim Pawlenty will assuredly sign the certificate required for Mr. Franken to be seated. The governor had indicated as late as Monday that he was willing to certify Mr. Franken as the winner once the state’s highest court decided the recount and Mr. Coleman’s battle. On CNN on Sunday, Mr. Pawlenty said: “I’m prepared to sign it as soon as they give the green light.”
Mark Ritchie, Minnesota’s secretary of state, also issued a statement saying: “This unanimous opinion of the court affirms the accuracy and fairness of Minnesota’s election laws and recount procedures. As required by Minnesota law, I will co-sign the election certificate as soon as it is issued by Governor Tim Pawlenty.”
Mr. Franken will become the Democrats’ much coveted 60th vote. That is the number required to avert filibusters, and with both Senators Edward M. Kennedy and Robert C. Byrd absent due to illness, the Democrats have sometimes scrambled to make sure they had lined up enough votes.
The senator-elect’s news conference is to begin shortly.
In its decision, the Minnesota Supreme Court upheld the rulings of the trial court, which had concluded that Mr. Franken won the election by about 312 votes. Throughout this battle, Mr. Coleman and his lawyers have cited discarded or wrongly discredited absentee ballots as well as other miscounted votes as part of the evidence of problems with the state’s count in this race.
But at oral arguments on June 1, the Supreme Court judges were highly skeptical of Mr. Coleman’s claims, on the counting grounds or constitutional grounds. John Schwartz, our national legal affairs correspondent, attended the arguments and indicated the judges’ questions made it fairly clear that the panel was not persuaded it should overturn the findings of the trial court, or the State Canvassing Board before that.
That was borne out in the panel’s ruling today.
Once Mr. Coleman had conceded, the White House released this statement on behalf of President Obama: “I look forward to working with Senator-Elect Franken to build a new foundation for growth and prosperity by lowering health care costs and investing in the kind of clean energy jobs and industries that will help America lead in the 21st century.”
Earlier, Senator Bob Menendez, the chairman of the National Democratic Senatorial Committee, urged a resolution to the race:
“As we’ve seen over the past 238 days, no matter how many times Norm Coleman goes to court, the result of the election never changes: Al Franken earned more votes than Norm Coleman. Al Franken was elected to the Senate and he ought to be able to get to work for the people of Minnesota. We’ve always said that Norm Coleman deserved his day in court, and he got eight months. Now we expect Governor Pawlenty to do the right thing, follow the law, and sign the election certificate. From health care to the Supreme Court to getting our economy moving again, the challenges facing us are complex and we need Al Franken in the Senate. In this historic and urgent moment in our history, Minnesotans have gone long enough without full representation. Al Franken will be an critical voice on the issues before us and it’s time to let him get to work.”
As for Mr. Coleman, he did not disclose his future plans at the news conference outside his home. Asked whether he would run for governor of Minnesota (Mr. Pawlenty has decided not to seek re-election), Mr. Coleman would only say that he was merely pondering how better to catch fish after apparently experiencing a poor catch this past weekend.
Despite what many in Minnesota viewed as a stubborn refusal to concede, Mr. Coleman said today: “I have never believed that my service is irreplaceable. We have reached the point where further litigation damages the unity of our state, which is also fundamental. In these tough times, we all need to focus on the future. And the future today is we have a new United States senator.”
Just this morning, MSNBC’s First Read listed several factoids that have accumulated during this fight:
$51.1 million has been raised between Coleman and Franken for the entire campaign
– $50.3 million has been spent between the two candidates
– $11 million (at least) has been spent on the recount
– 2,424,946 votes were cast
– 312 votes separate the candidates (Franken leads)
– 239 days since Election Day 2008
– 34 weeks since Election Day 2008
– 7 months, 27 days since Election Day 2008
– 4 seasons seen since Election Day 2008 election.
Tuesday, June 30, 2009
Chicago Sun Times Editorial: How about some compassion for those stuck with the bill?
Chicago Sun Times Editorial: How about some compassion for those stuck with the bill?
Copyright by The Chicago Sun Times
June 30, 2009
http://www.suntimes.com/news/commentary/1644942,CST-EDT-edit30b.article
Why is it whenever someone in the Daley administration gets tangled up in a hiring abuse investigation, the mayor invokes family values?
When the mayor's former patronage chief Robert Sorich and three other city employees were convicted as part of a City Hall hiring fraud investigation a few years back, the mayor said "they are very fine young men, and their families."
When Daley's former head of Streets and Sanitation, Al Sanchez, was convicted for much the same behavior, the mayor noted Sanchez is "very proud of his family."
And last week, when city Inspector General David Hoffman alleged that the mayor's head of human resources, Homero Tristan, lied during an investigation and should be fired, the mayor said Tristan was "dedicated," a "good civil servant" and -- you guessed it -- a "family man."
To be clear, no one's saying these guys don't love their families.
Families have nothing to do with it -- unless you count the families of the hard-working men and women passed over for city jobs or promotions because they had no clout.
Nor is anyone claiming Sorich and company murdered anyone.
Their crimes -- in the case of Sorich and his cohorts, and Sanchez -- are much less serious.
As for Tristan, who has not been charged with any wrongdoing, the allegation that he covered up a mistake by lying to Hoffman's investigators is much worse than his supposed infraction. In his own defense, Tristan says he did nothing wrong.
But all of his doesn't make hiring problems something to be treated lightly.
Which seems to be the attitude at City Hall, from the top down. An attitude that has cost taxpayers millions of dollars in legal fees and in payouts to passed-over employees.
City Hall can either get serious and clean up the mess -- or taxpayers can get out their checkbooks.
Copyright by The Chicago Sun Times
June 30, 2009
http://www.suntimes.com/news/commentary/1644942,CST-EDT-edit30b.article
Why is it whenever someone in the Daley administration gets tangled up in a hiring abuse investigation, the mayor invokes family values?
When the mayor's former patronage chief Robert Sorich and three other city employees were convicted as part of a City Hall hiring fraud investigation a few years back, the mayor said "they are very fine young men, and their families."
When Daley's former head of Streets and Sanitation, Al Sanchez, was convicted for much the same behavior, the mayor noted Sanchez is "very proud of his family."
And last week, when city Inspector General David Hoffman alleged that the mayor's head of human resources, Homero Tristan, lied during an investigation and should be fired, the mayor said Tristan was "dedicated," a "good civil servant" and -- you guessed it -- a "family man."
To be clear, no one's saying these guys don't love their families.
Families have nothing to do with it -- unless you count the families of the hard-working men and women passed over for city jobs or promotions because they had no clout.
Nor is anyone claiming Sorich and company murdered anyone.
Their crimes -- in the case of Sorich and his cohorts, and Sanchez -- are much less serious.
As for Tristan, who has not been charged with any wrongdoing, the allegation that he covered up a mistake by lying to Hoffman's investigators is much worse than his supposed infraction. In his own defense, Tristan says he did nothing wrong.
But all of his doesn't make hiring problems something to be treated lightly.
Which seems to be the attitude at City Hall, from the top down. An attitude that has cost taxpayers millions of dollars in legal fees and in payouts to passed-over employees.
City Hall can either get serious and clean up the mess -- or taxpayers can get out their checkbooks.
Amazon.com fights sales-tax plans
Amazon.com fights sales-tax plans
The Internet retailer jettisons advertising affiliates in two states to avoid taxing its customers there. Overstock.com plans to follow suit.
By Andrea Chang
Copyright © 2009, The Los Angeles Times
June 30, 2009
http://www.chicagotribune.com/business/la-fi-amazon30-2009jun30,0,1737212.story
As revenue-hungry states eye Internet retailers as possible sources of new taxes, Amazon.com Inc. is firing back.
Already, the nation's largest Internet retailer has cut ties with its affiliate websites in two states to avoid legislation that would require the company to collect sales taxes from its customers there. And it is fighting similar tax proposals in several other states, including California.
At issue is the company's Associates Program, which lets thousands of small businesses earn money by posting ads for Amazon and its products on their websites. If a consumer clicks through and buys something, Amazon gives a referral fee -- as much as a 15% cut on the sale -- to the third-party website.
Currently, states can levy sales taxes on Internet commerce only when the Web company has a "physical presence" in the state, such as a corporate office, store or warehouse.
Seattle-based Amazon, for instance, must charge sales taxes on purchases made online by Washington state residents. But Amazon customers in nearly every other state don't have to pay sales taxes when they buy from the site.
Now several states are arguing that these third-party advertising contracts at Amazon and other Internet retailers constitute a physical presence. The states are looking to those companies to charge sales taxes.
On Monday, Amazon cut its ties with Rhode Island affiliates after the state's Assembly passed legislation requiring the company to collect taxes; three days earlier, Amazon canceled its program in North Carolina.
"We feel that the way the state legislatures are going about this is inappropriate," said Patty Smith, an Amazon spokeswoman. "It places an unconstitutional burden on interstate commerce for a state to require a seller without a physical presence in that state to collect sales tax."
Similar legislation is awaiting action in California's state government, prompting Amazon to send a letter to Gov. Arnold Schwarzenegger last week saying it opposed the move.
"If this new tax collection scheme were enacted, Amazon would have little choice but to end its advertising relationships with California-based participants in the Amazon 'Associates Program,' " the letter said. "Thus, this provision would provide no new tax revenue collected by Amazon or others who sever their relationships with California-based advertisers."
On Monday, Schwarzenegger spokeswoman Rachel Cameron said, "The governor has been clear that he is not supportive of new tax increases to solving the budget problem."
Other well-known Internet retailers, including Overstock.com Inc., have pledged to take similar actions. The Salt Lake City-based retailer runs an affiliate program that is similar to Amazon's and is preparing to cancel its programs in North Carolina and Rhode Island, Overstock.com President Jonathan Johnson said.
"We turned off over 3,400 affiliates in New York and we're looking at doing it in every state that's got that kind of legislation proposed," Johnson said. "In our view, it's just not worth it to run an affiliate program where the state's going to make us a tax collector."
Supporters of the legislation say the status quo gives out-of-state retailers an unfair advantage over local merchants and argue that the companies' advertising affiliates clearly indicate a connection, or nexus, between the retailers and the states.
"What the affiliate marketing programs are, are people who are under contract through Amazon who are being paid on commission for referring sales to Amazon," said Lenny Goldberg, executive director at the California Tax Reform Assn. in Sacramento, which supports requiring retailers to charge sales taxes.
"That's drop-dead nexus," he said.
Opponents argue that collecting sales taxes would be both burdensome and costly for Internet retailers; for consumers, it would raise the total cost of purchases. Thousands of people who rely on commission fees would be affected by the programs' cancellation.
Fred Nicely, tax counsel with the Washington-based Council on State Taxation, called the states' efforts to tax shoppers based on affiliate programs "constitutionally suspect."
"This is not door-to-door sales, where someone is knocking on your door, showing you the goods, demonstrating the goods," he said. "This is passive advertising, which the U.S. Supreme Court has said is not enough of a presence in the state to require a remote seller to have to collect a state sales tax."
Nicely said many states are pushing Internet retailers to charge sales taxes as a way to help manage significant budget problems.
"I think they're doing everything they can to get revenue because the states are hurting right now," he said. "We're in a down economy and they're thinking of alternative revenue sources, and this is something they see as potentially easy money."
andrea.chang@latimes.com
The Internet retailer jettisons advertising affiliates in two states to avoid taxing its customers there. Overstock.com plans to follow suit.
By Andrea Chang
Copyright © 2009, The Los Angeles Times
June 30, 2009
http://www.chicagotribune.com/business/la-fi-amazon30-2009jun30,0,1737212.story
As revenue-hungry states eye Internet retailers as possible sources of new taxes, Amazon.com Inc. is firing back.
Already, the nation's largest Internet retailer has cut ties with its affiliate websites in two states to avoid legislation that would require the company to collect sales taxes from its customers there. And it is fighting similar tax proposals in several other states, including California.
At issue is the company's Associates Program, which lets thousands of small businesses earn money by posting ads for Amazon and its products on their websites. If a consumer clicks through and buys something, Amazon gives a referral fee -- as much as a 15% cut on the sale -- to the third-party website.
Currently, states can levy sales taxes on Internet commerce only when the Web company has a "physical presence" in the state, such as a corporate office, store or warehouse.
Seattle-based Amazon, for instance, must charge sales taxes on purchases made online by Washington state residents. But Amazon customers in nearly every other state don't have to pay sales taxes when they buy from the site.
Now several states are arguing that these third-party advertising contracts at Amazon and other Internet retailers constitute a physical presence. The states are looking to those companies to charge sales taxes.
On Monday, Amazon cut its ties with Rhode Island affiliates after the state's Assembly passed legislation requiring the company to collect taxes; three days earlier, Amazon canceled its program in North Carolina.
"We feel that the way the state legislatures are going about this is inappropriate," said Patty Smith, an Amazon spokeswoman. "It places an unconstitutional burden on interstate commerce for a state to require a seller without a physical presence in that state to collect sales tax."
Similar legislation is awaiting action in California's state government, prompting Amazon to send a letter to Gov. Arnold Schwarzenegger last week saying it opposed the move.
"If this new tax collection scheme were enacted, Amazon would have little choice but to end its advertising relationships with California-based participants in the Amazon 'Associates Program,' " the letter said. "Thus, this provision would provide no new tax revenue collected by Amazon or others who sever their relationships with California-based advertisers."
On Monday, Schwarzenegger spokeswoman Rachel Cameron said, "The governor has been clear that he is not supportive of new tax increases to solving the budget problem."
Other well-known Internet retailers, including Overstock.com Inc., have pledged to take similar actions. The Salt Lake City-based retailer runs an affiliate program that is similar to Amazon's and is preparing to cancel its programs in North Carolina and Rhode Island, Overstock.com President Jonathan Johnson said.
"We turned off over 3,400 affiliates in New York and we're looking at doing it in every state that's got that kind of legislation proposed," Johnson said. "In our view, it's just not worth it to run an affiliate program where the state's going to make us a tax collector."
Supporters of the legislation say the status quo gives out-of-state retailers an unfair advantage over local merchants and argue that the companies' advertising affiliates clearly indicate a connection, or nexus, between the retailers and the states.
"What the affiliate marketing programs are, are people who are under contract through Amazon who are being paid on commission for referring sales to Amazon," said Lenny Goldberg, executive director at the California Tax Reform Assn. in Sacramento, which supports requiring retailers to charge sales taxes.
"That's drop-dead nexus," he said.
Opponents argue that collecting sales taxes would be both burdensome and costly for Internet retailers; for consumers, it would raise the total cost of purchases. Thousands of people who rely on commission fees would be affected by the programs' cancellation.
Fred Nicely, tax counsel with the Washington-based Council on State Taxation, called the states' efforts to tax shoppers based on affiliate programs "constitutionally suspect."
"This is not door-to-door sales, where someone is knocking on your door, showing you the goods, demonstrating the goods," he said. "This is passive advertising, which the U.S. Supreme Court has said is not enough of a presence in the state to require a remote seller to have to collect a state sales tax."
Nicely said many states are pushing Internet retailers to charge sales taxes as a way to help manage significant budget problems.
"I think they're doing everything they can to get revenue because the states are hurting right now," he said. "We're in a down economy and they're thinking of alternative revenue sources, and this is something they see as potentially easy money."
andrea.chang@latimes.com
Financial Times Editorial Comment: Iran’s intimidation needs EU response
Financial Times Editorial Comment: Iran’s intimidation needs EU response
Copyright The Financial Times Limited 2009
Published: June 29 2009 19:17 | Last updated: June 29 2009 19:17
http://www.ft.com/cms/s/0/fa973a5a-64d5-11de-a13f-00144feabdc0.html
The arrest and interrogation of Iranian employees of the British embassy in Tehran is alarming. Iran has form on embassies.
Its regime therefore needs to be made very certain that it will pay a high cost if it further crosses the lines of international law and diplomatic protocol.
The arrests, along with the ritual denunciation of and incitement against the UK by the government and Ayatollah Ali Khamenei, the supreme leader, are nothing but a transparent ruse to blame a manufactured external culprit for the civic uprising of Iranians against an equally manufactured landslide for Mahmoud Ahmadi-Nejad, Iran’s demagogic president.
The mullahs have justified their overreaction to the late surge of voters in favour of Mir-Hossein Moussavi by talking darkly of a “velvet revolution” and tenebrous conspiracies against the Islamic Republic. The fact is that Mr Moussavi, prime minister in the early years after the 1979 revolution, and his supporters in the establishment and the clergy, such as former presidents Mohammad Khatami and Akbar Hashemi Rafsanjani, are seeking the reform of Iran’s blend of theocracy and dem ocracy, not to overthrow it. They can claim to be the authentic offspring of the revolution,which is precisely why they pose a threat to the legitimacy of Mr Khamenei and Mr Ahmadi-Nejad: an internal threat, cleaving the establishment.
Britain nevertheless makes an attractive target for a regime at bay. Its long and documented history of meddling in Iran resonates with most Iranians. In the late-19th and early 20th centuries it reduced Iran almost to a protectorate, extracting lucrative concessions in oil and minerals, tobacco and banking, which it protected by armed force and proxy rulers. Britain’s alliance with the US in toppling the nationalist Mossadegh government in 1953 is well-known.
The UK is also a natural proxy for the US for a regime nervous of the embrace of engagement proffered by Barack Obama. External pressure – real or invented – is a much more reliable tool for the mullahs to enforce national unity.
But the theocrats are genuinely alarmed by the BBC’s Persian TV service, which came on air this year and offers millions of Iranians a sober view of the issues and events that divide them. The revolutionaries will remember how the BBC helped their cause in 1978-79 with its reliable and timely chronicle of the turmoil.
Britain has rightly taken its case to its partners in the European Union, which have promised a “strong and collective” response if Tehran continues to harass embassy staff. Faced with retaliation from 27 countries rather than one “little Satan”, Iran might just think again. This is an important test of EU cohesion and solidarity. It must not fail.
Copyright The Financial Times Limited 2009
Published: June 29 2009 19:17 | Last updated: June 29 2009 19:17
http://www.ft.com/cms/s/0/fa973a5a-64d5-11de-a13f-00144feabdc0.html
The arrest and interrogation of Iranian employees of the British embassy in Tehran is alarming. Iran has form on embassies.
Its regime therefore needs to be made very certain that it will pay a high cost if it further crosses the lines of international law and diplomatic protocol.
The arrests, along with the ritual denunciation of and incitement against the UK by the government and Ayatollah Ali Khamenei, the supreme leader, are nothing but a transparent ruse to blame a manufactured external culprit for the civic uprising of Iranians against an equally manufactured landslide for Mahmoud Ahmadi-Nejad, Iran’s demagogic president.
The mullahs have justified their overreaction to the late surge of voters in favour of Mir-Hossein Moussavi by talking darkly of a “velvet revolution” and tenebrous conspiracies against the Islamic Republic. The fact is that Mr Moussavi, prime minister in the early years after the 1979 revolution, and his supporters in the establishment and the clergy, such as former presidents Mohammad Khatami and Akbar Hashemi Rafsanjani, are seeking the reform of Iran’s blend of theocracy and dem ocracy, not to overthrow it. They can claim to be the authentic offspring of the revolution,which is precisely why they pose a threat to the legitimacy of Mr Khamenei and Mr Ahmadi-Nejad: an internal threat, cleaving the establishment.
Britain nevertheless makes an attractive target for a regime at bay. Its long and documented history of meddling in Iran resonates with most Iranians. In the late-19th and early 20th centuries it reduced Iran almost to a protectorate, extracting lucrative concessions in oil and minerals, tobacco and banking, which it protected by armed force and proxy rulers. Britain’s alliance with the US in toppling the nationalist Mossadegh government in 1953 is well-known.
The UK is also a natural proxy for the US for a regime nervous of the embrace of engagement proffered by Barack Obama. External pressure – real or invented – is a much more reliable tool for the mullahs to enforce national unity.
But the theocrats are genuinely alarmed by the BBC’s Persian TV service, which came on air this year and offers millions of Iranians a sober view of the issues and events that divide them. The revolutionaries will remember how the BBC helped their cause in 1978-79 with its reliable and timely chronicle of the turmoil.
Britain has rightly taken its case to its partners in the European Union, which have promised a “strong and collective” response if Tehran continues to harass embassy staff. Faced with retaliation from 27 countries rather than one “little Satan”, Iran might just think again. This is an important test of EU cohesion and solidarity. It must not fail.
Deficit forces California to issue IOUs
Deficit forces California to issue IOUs
By Matthew Garrahan in Los Angeles
Copyright The Financial Times Limited 2009
Published: June 29 2009 19:26 | Last updated: June 29 2009 19:26
http://www.ft.com/cms/s/0/1940d18e-64cf-11de-a13f-00144feabdc0.html
California is preparing to issue IOUs to its creditors this week as it grapples with an unprecedented cash crunch and prepares to begin its new fiscal year deep in the red.
Once the US’s richest state, California now has the dubious distinction of having the worst credit rating in the country.
It is facing a budget deficit of $24bn (€17bn, £14.5bn) yet Arnold Schwarzenegger, its governor, and the state assembly cannot agree on a budget that would address the shortfall.
California’s fiscal year ends on Wednesday but as the state’s cash reserves are empty, IOUs will be issued to a range of creditors, including contractors, such as information technology companies and the food service groups that cater for prisons.
“On Wednesday we start a fiscal year with a massively unbalanced spending plan and a cash shortfall not seen since the Great Depression,” said John Chiang, the state controller. “Unfortunately, the state’s inability to balance its chequebook will now mean short-changing taxpayers, local governments and small businesses.”
The state is also likely to issue IOUs to the US government. California currently contributes funding for government-run programmes for elderly and developmentally disabled people but is considering issuing IOUs to cover its contributions because of the lack of cash.
Education funding is protected under the state’s constitution while payments on the state’s bond debt are also guaranteed under state law.
Democrats and Republicans in the state government last week struck an agreement on a range of money-saving measures. However, Mr Schwarzenegger has threatened to veto the plan on the grounds that it was a piecemeal solution to California’s budgetary woes.
Mr Schwarzenegger said he would veto any bills that raised taxes without reforming the state’s government. “I will veto any majority vote tax increase bill that punishes taxpayers for Sacramento’s failure to live within its means,” he said. ”The legislature will have a difficult time explaining to Californians why they are running floor drills the day before our budget deadline. We do not have time for any more floor drills or partial solutions. It’s time for the legislature to send me a budget that solves our entire deficit without raising taxes.”
By Matthew Garrahan in Los Angeles
Copyright The Financial Times Limited 2009
Published: June 29 2009 19:26 | Last updated: June 29 2009 19:26
http://www.ft.com/cms/s/0/1940d18e-64cf-11de-a13f-00144feabdc0.html
California is preparing to issue IOUs to its creditors this week as it grapples with an unprecedented cash crunch and prepares to begin its new fiscal year deep in the red.
Once the US’s richest state, California now has the dubious distinction of having the worst credit rating in the country.
It is facing a budget deficit of $24bn (€17bn, £14.5bn) yet Arnold Schwarzenegger, its governor, and the state assembly cannot agree on a budget that would address the shortfall.
California’s fiscal year ends on Wednesday but as the state’s cash reserves are empty, IOUs will be issued to a range of creditors, including contractors, such as information technology companies and the food service groups that cater for prisons.
“On Wednesday we start a fiscal year with a massively unbalanced spending plan and a cash shortfall not seen since the Great Depression,” said John Chiang, the state controller. “Unfortunately, the state’s inability to balance its chequebook will now mean short-changing taxpayers, local governments and small businesses.”
The state is also likely to issue IOUs to the US government. California currently contributes funding for government-run programmes for elderly and developmentally disabled people but is considering issuing IOUs to cover its contributions because of the lack of cash.
Education funding is protected under the state’s constitution while payments on the state’s bond debt are also guaranteed under state law.
Democrats and Republicans in the state government last week struck an agreement on a range of money-saving measures. However, Mr Schwarzenegger has threatened to veto the plan on the grounds that it was a piecemeal solution to California’s budgetary woes.
Mr Schwarzenegger said he would veto any bills that raised taxes without reforming the state’s government. “I will veto any majority vote tax increase bill that punishes taxpayers for Sacramento’s failure to live within its means,” he said. ”The legislature will have a difficult time explaining to Californians why they are running floor drills the day before our budget deadline. We do not have time for any more floor drills or partial solutions. It’s time for the legislature to send me a budget that solves our entire deficit without raising taxes.”
Obama junks ‘global war on terror’ label
Obama junks ‘global war on terror’ label
By Edward Luce and Daniel Dombey in Washington
Copyright The Financial Times Limited 2009
Published: June 30 2009 01:04 | Last updated: June 30 2009 01:04
http://www.ft.com/cms/s/0/d4bd1bb6-64f7-11de-a13f-00144feabdc0.html
The Obama administration has junked the term “global war on terror” because it does not describe properly the nature of the terrorist threat to the US, according to Janet Napolitano, secretary for homeland security.
“One of the reasons the nomenclature is not used is that ‘war’ carries with it a relationship to nation states in conflict with each other and of course terrorism is not necessarily derived from the nation state relationship,” she told the Financial Times. “In some respects ‘war’ is too limiting.”
Ms Napolitano’s comments were the clearest acknowledgement by an Obama official of a widely observed change in language. In March, the White House denied reports that an internal memo had been issued banning the term. But Mr Obama has studiously avoided the phrase, which officials see as legally troublesome and politically counterproductive.
Ms Napolitano, who arrived on Monday night in the UK, said she was hoping to learn from her British counterparts, and others, how to improve public “resiliency” to terrorist attacks. “You have got to minimise risk and respond with resiliency – there are lessons to be learned from other countries and the UK is one of them,” she said.
Ms Napolitano, the former governor of Arizona, is in charge of 22 former agencies that make up the Department of Homeland Security.
Her comments follow increasingly strident criticism from Dick Cheney, the former vice-president, that Mr Obama’s actions, including the pledge to close the Guantánamo Bay detention centre and dropping the term “war on terror”, would increase the terrorist threat to the US.
Ms Napolitano dismissed Mr Cheney’s warnings. “Pivoting from closing Guantánamo to the argument that [its closure] could be the causal agent for an attack on the US is, to be charitable, a stretch,” she said. But she conceded the administration needed to do more to persuade Congress to house Guantánamo detainees on US soil.
Ms Napolitano said she also continued to monitor the threat of domestic terrorism following a DHS report in March warning that the declining economy and the return of military veterans meant that there was an increasing threat of rightwing “lone wolf” terrorist activity.
“The fact of the matter is that this threat is very real and is not solely rightwing or leftwing,” she added.
By Edward Luce and Daniel Dombey in Washington
Copyright The Financial Times Limited 2009
Published: June 30 2009 01:04 | Last updated: June 30 2009 01:04
http://www.ft.com/cms/s/0/d4bd1bb6-64f7-11de-a13f-00144feabdc0.html
The Obama administration has junked the term “global war on terror” because it does not describe properly the nature of the terrorist threat to the US, according to Janet Napolitano, secretary for homeland security.
“One of the reasons the nomenclature is not used is that ‘war’ carries with it a relationship to nation states in conflict with each other and of course terrorism is not necessarily derived from the nation state relationship,” she told the Financial Times. “In some respects ‘war’ is too limiting.”
Ms Napolitano’s comments were the clearest acknowledgement by an Obama official of a widely observed change in language. In March, the White House denied reports that an internal memo had been issued banning the term. But Mr Obama has studiously avoided the phrase, which officials see as legally troublesome and politically counterproductive.
Ms Napolitano, who arrived on Monday night in the UK, said she was hoping to learn from her British counterparts, and others, how to improve public “resiliency” to terrorist attacks. “You have got to minimise risk and respond with resiliency – there are lessons to be learned from other countries and the UK is one of them,” she said.
Ms Napolitano, the former governor of Arizona, is in charge of 22 former agencies that make up the Department of Homeland Security.
Her comments follow increasingly strident criticism from Dick Cheney, the former vice-president, that Mr Obama’s actions, including the pledge to close the Guantánamo Bay detention centre and dropping the term “war on terror”, would increase the terrorist threat to the US.
Ms Napolitano dismissed Mr Cheney’s warnings. “Pivoting from closing Guantánamo to the argument that [its closure] could be the causal agent for an attack on the US is, to be charitable, a stretch,” she said. But she conceded the administration needed to do more to persuade Congress to house Guantánamo detainees on US soil.
Ms Napolitano said she also continued to monitor the threat of domestic terrorism following a DHS report in March warning that the declining economy and the return of military veterans meant that there was an increasing threat of rightwing “lone wolf” terrorist activity.
“The fact of the matter is that this threat is very real and is not solely rightwing or leftwing,” she added.
US consumer confidence drops in June
US consumer confidence drops in June
By Sarah O’Connor in Washington
Copyright The Financial Times Limited 2009
Published: June 30 2009 15:31 | Last updated: June 30 2009 16:45
http://www.ft.com/cms/s/0/c9dd6ac0-657e-11de-8e34-00144feabdc0.html
Confidence among US consumers dropped in June after two months of building optimism, surprising economists and knocking the wind from stock markets.
The Confidence Board, an industry group, said its index of consumer confidence dropped to 49.3 this month from a revised 54.8 in May. Economists had expected a figure of around 55, but consumers are feeling worse about the current state of the economy and about where they expect it to be in six months’ time.
Confidence built over the spring amid talk of “green shoots” in the economy and a rising stock market, but this month people say business conditions are worse and jobs are becoming harder to find.
Just 17.4 per cent of consumers surveyed said they expected more jobs to appear in the months ahead, down from 19.3 per cent in May.
The pace of layoffs has lessened somewhat recently but the unemployment rate has leapt to 9.4 per cent, creating a swelling pool of people searching for a shrinking number of jobs.
“For consumers I think the light bulb finally went on and they said ‘you know, less bad is probably not good enough, “less bad” doesn’t pay the bills,’” said Mark Vitner, senior economist at Wachovia. “It may be that consumers need to see a tangible improvement in their own conditions before they buy into the idea the economy is improving.”
There was some positive news on Tuesday, though, as separate figures showed the pace of the US housing downturn abated in April.
House prices in 20 metropolitan areas fell 0.6 per cent month-on-month in April, according to the S&P Case-Shiller home-price index, following a 2.2 per cent decline a month earlier.
Prices were still 18.1 per cent lower than they were a year ago, in a sign of how savaged the housing market has been during this recession. Economists, however, were expecting a worse figure of 18.6 per cent.
“While one month’s data cannot determine if a turnaround has begun, it seems that some stabilisation may be appearing in some of the regions,” said David Blitzer, chairman of the S&P index committee. However, he warned that the spring and summer are traditionally stronger months for house prices, “so it will take some time to determine if a recovery is really here.”
Eight of the 20 areas recorded rising prices, including Dallas, Washington DC, San Francisco and Boston. Areas where prices were bumped up by speculative buying during the bubble years remained the hardest hit, such as Phoenix, Miami and Las Vegas.
The housing market has been at the epicentre of the US recession as collapsing prices kicked off a wave of defaults on parcels of mortgage debt held by banks. The Case-Schiller index has fallen by almost a third since the peak of the market in mid-2006, and many believe prices must stop falling before a broader economic recovery can begin.
Delinquency rates on the least risky mortgages more than doubled in the first quarter from a year earlier, indicating that the pain that began in the “subprime” area is spreading more people struggle to meet their mortgage payments.
Prime mortgages 60 days or more past due climbed to 2.9 per cent, from 1.1 per cent at the same point in 2008, according to the Office of the Comptroller of the Currency and the Office of Thrift Supervision
“I’m very concerned about the rise in delinquent mortgages and foreclosure actions,” said John Dugan, Comptroller of the Currency, but added that he was heartened by the rising number of people modifying their mortgages to make them more manageable.
By Sarah O’Connor in Washington
Copyright The Financial Times Limited 2009
Published: June 30 2009 15:31 | Last updated: June 30 2009 16:45
http://www.ft.com/cms/s/0/c9dd6ac0-657e-11de-8e34-00144feabdc0.html
Confidence among US consumers dropped in June after two months of building optimism, surprising economists and knocking the wind from stock markets.
The Confidence Board, an industry group, said its index of consumer confidence dropped to 49.3 this month from a revised 54.8 in May. Economists had expected a figure of around 55, but consumers are feeling worse about the current state of the economy and about where they expect it to be in six months’ time.
Confidence built over the spring amid talk of “green shoots” in the economy and a rising stock market, but this month people say business conditions are worse and jobs are becoming harder to find.
Just 17.4 per cent of consumers surveyed said they expected more jobs to appear in the months ahead, down from 19.3 per cent in May.
The pace of layoffs has lessened somewhat recently but the unemployment rate has leapt to 9.4 per cent, creating a swelling pool of people searching for a shrinking number of jobs.
“For consumers I think the light bulb finally went on and they said ‘you know, less bad is probably not good enough, “less bad” doesn’t pay the bills,’” said Mark Vitner, senior economist at Wachovia. “It may be that consumers need to see a tangible improvement in their own conditions before they buy into the idea the economy is improving.”
There was some positive news on Tuesday, though, as separate figures showed the pace of the US housing downturn abated in April.
House prices in 20 metropolitan areas fell 0.6 per cent month-on-month in April, according to the S&P Case-Shiller home-price index, following a 2.2 per cent decline a month earlier.
Prices were still 18.1 per cent lower than they were a year ago, in a sign of how savaged the housing market has been during this recession. Economists, however, were expecting a worse figure of 18.6 per cent.
“While one month’s data cannot determine if a turnaround has begun, it seems that some stabilisation may be appearing in some of the regions,” said David Blitzer, chairman of the S&P index committee. However, he warned that the spring and summer are traditionally stronger months for house prices, “so it will take some time to determine if a recovery is really here.”
Eight of the 20 areas recorded rising prices, including Dallas, Washington DC, San Francisco and Boston. Areas where prices were bumped up by speculative buying during the bubble years remained the hardest hit, such as Phoenix, Miami and Las Vegas.
The housing market has been at the epicentre of the US recession as collapsing prices kicked off a wave of defaults on parcels of mortgage debt held by banks. The Case-Schiller index has fallen by almost a third since the peak of the market in mid-2006, and many believe prices must stop falling before a broader economic recovery can begin.
Delinquency rates on the least risky mortgages more than doubled in the first quarter from a year earlier, indicating that the pain that began in the “subprime” area is spreading more people struggle to meet their mortgage payments.
Prime mortgages 60 days or more past due climbed to 2.9 per cent, from 1.1 per cent at the same point in 2008, according to the Office of the Comptroller of the Currency and the Office of Thrift Supervision
“I’m very concerned about the rise in delinquent mortgages and foreclosure actions,” said John Dugan, Comptroller of the Currency, but added that he was heartened by the rising number of people modifying their mortgages to make them more manageable.
Joy and fear as US exits Iraqi cities
Joy and fear as US exits Iraqi cities
By Ernesto Londoño in Baghdad
Copyright The Financial Times Limited 2009
Published: June 29 2009 18:22 | Last updated: June 30 2009 08:48
http://www.ft.com/cms/s/0/f0cc9f9e-64ce-11de-a13f-00144feabdc0.html
Iraqi soldiers on parade in Baghdad during a ceremony in which US forces handed over power
According to Nouri al-Maliki, the withdrawal of US troops from Iraq’s cities, set to be completed on Tuesday, will be a turning point for the country. The Iraqi prime minister has called for nationwide celebrations, which began on Monday night in Baghdad.
But across the country the US military’s withdrawal is being viewed with a mix of apprehension, pride and incredulity.
“I will celebrate when I see my country living in peace,” said Salah al-Jbory, a tribal leader in the western Baghdad neighbourhood of Dora, where no US outposts remain.
“I will celebrate when there is electricity and clean water; when people go to the park and feel safe. I’ll celebrate when kids on the street look clean and are wearing new clothes. I will celebrate when people can earn a living.”
In remarks calling the withdrawal of US troops on Monday a “great victory” for Iraqis, Mr Maliki has shown no hint of deference to the thousands of US lives lost in Iraq, and the billions of US tax dollars spent there.
Many Iraqis speak about the US’s dwarfing presence in Iraq in apocalyptic terms, but the public statements by government officials in recent days appear to have emboldened Iraqis like never before to rail against what many still call “occupation forces”.
US soldiers have been thinning out across Baghdad and other restive cities in recent months. They have shut down dozens of inner-city bases and, in the months ahead, will seek to become as inconspicuous as possible in urban areas.
During the first days of July, in an effort to comply with the security agreement that set strict pull-out dates, US soldiers in, and near, urban areas anticipate being on lockdown.
Some Iraqis have described the date as an independence day of sorts.
“The 30th of June will be like a wedding,” said Major General Abdel Amir al-Zaidi, commander of the Iraqi army’s 11th Division, currently in the northern city of Kirkuk.
“It is a victory for all Iraqis, a national holiday.”
Not everyone shares that sentiment. Violence has increased in recent days as insurgents have sought to make such calls for jubilation seem like hubris.
A string of bombs last week, including powerful ones in Kirkuk and the eastern Baghdad district of Sadr City, killed more than 200 people.
“We are not happy now,” said Abu Noor, a college student standing outside a market in Ur in north-east Baghdad.
“Why should we be happy? We know that things will turn upside down after maybe a week of the withdrawal. We all know that the militias are hiding because they know the Americans are inside the cities and are ready to be there at a moment’s notice.”
Many Iraqis have come to regard the US troops in their neighbourhoods as a necessary evil. Their hulking trucks often tear down wires, bog down traffic and jam mobile phone signals. But those indignities are a small price to pay, according to Mr Noor.
“They’re trivial when you compare it to the importance of security,” he said.
Miles away, in a central Baghdad district where attacks remain frequent, Ala Abdul Majid, a national police officer, stands under a small bunker-turned-checkpoint, watching cars pass during a recent sweltering afternoon.
“Iraqis are able to handle the job,” he said, brimming with confidence, pausing before adding: “At least 80, 90 per cent.”
He was happy to see the US forces fade into the background. It was time. But he believed that they had done more good than bad, providing the Iraqi security forces with uniforms, spare parts for cars and generators for police stations.
If speculation about an increase in attacks after on Tuesday proved true, he said, Iraqis would do their best with what they had.
“We don’t have equipment; no radios,” he said, suddenly less optimistic. “If someone came here at night and killed us, no one would know about it.”
A bombing in downtown Mosul on Monday killed 10 people. A US soldier was killed in combat on Sunday, the military said, in one of the most recent of a near-daily string of attacks on US forces.
Anticipating a wave of attacks during this transition period, Iraqi soldiers and policemen were out in full strength across the country on Monday. Lines at checkpoints were longer as policemen conducted more thorough searches.
At a celebration in Baghdad’s Zahra Park, one of the largest in the country, revellers sang songs popular during the war between Iraq and Iran in 1980. “To the front lines we go,” they sang. “Our bullets in our magazines.”
Then, bobbing their heads in unison and spraying water from bottles at the crowd, they began chanting: “America has left! Baghdad is victorious!”
By Ernesto Londoño in Baghdad
Copyright The Financial Times Limited 2009
Published: June 29 2009 18:22 | Last updated: June 30 2009 08:48
http://www.ft.com/cms/s/0/f0cc9f9e-64ce-11de-a13f-00144feabdc0.html
Iraqi soldiers on parade in Baghdad during a ceremony in which US forces handed over power
According to Nouri al-Maliki, the withdrawal of US troops from Iraq’s cities, set to be completed on Tuesday, will be a turning point for the country. The Iraqi prime minister has called for nationwide celebrations, which began on Monday night in Baghdad.
But across the country the US military’s withdrawal is being viewed with a mix of apprehension, pride and incredulity.
“I will celebrate when I see my country living in peace,” said Salah al-Jbory, a tribal leader in the western Baghdad neighbourhood of Dora, where no US outposts remain.
“I will celebrate when there is electricity and clean water; when people go to the park and feel safe. I’ll celebrate when kids on the street look clean and are wearing new clothes. I will celebrate when people can earn a living.”
In remarks calling the withdrawal of US troops on Monday a “great victory” for Iraqis, Mr Maliki has shown no hint of deference to the thousands of US lives lost in Iraq, and the billions of US tax dollars spent there.
Many Iraqis speak about the US’s dwarfing presence in Iraq in apocalyptic terms, but the public statements by government officials in recent days appear to have emboldened Iraqis like never before to rail against what many still call “occupation forces”.
US soldiers have been thinning out across Baghdad and other restive cities in recent months. They have shut down dozens of inner-city bases and, in the months ahead, will seek to become as inconspicuous as possible in urban areas.
During the first days of July, in an effort to comply with the security agreement that set strict pull-out dates, US soldiers in, and near, urban areas anticipate being on lockdown.
Some Iraqis have described the date as an independence day of sorts.
“The 30th of June will be like a wedding,” said Major General Abdel Amir al-Zaidi, commander of the Iraqi army’s 11th Division, currently in the northern city of Kirkuk.
“It is a victory for all Iraqis, a national holiday.”
Not everyone shares that sentiment. Violence has increased in recent days as insurgents have sought to make such calls for jubilation seem like hubris.
A string of bombs last week, including powerful ones in Kirkuk and the eastern Baghdad district of Sadr City, killed more than 200 people.
“We are not happy now,” said Abu Noor, a college student standing outside a market in Ur in north-east Baghdad.
“Why should we be happy? We know that things will turn upside down after maybe a week of the withdrawal. We all know that the militias are hiding because they know the Americans are inside the cities and are ready to be there at a moment’s notice.”
Many Iraqis have come to regard the US troops in their neighbourhoods as a necessary evil. Their hulking trucks often tear down wires, bog down traffic and jam mobile phone signals. But those indignities are a small price to pay, according to Mr Noor.
“They’re trivial when you compare it to the importance of security,” he said.
Miles away, in a central Baghdad district where attacks remain frequent, Ala Abdul Majid, a national police officer, stands under a small bunker-turned-checkpoint, watching cars pass during a recent sweltering afternoon.
“Iraqis are able to handle the job,” he said, brimming with confidence, pausing before adding: “At least 80, 90 per cent.”
He was happy to see the US forces fade into the background. It was time. But he believed that they had done more good than bad, providing the Iraqi security forces with uniforms, spare parts for cars and generators for police stations.
If speculation about an increase in attacks after on Tuesday proved true, he said, Iraqis would do their best with what they had.
“We don’t have equipment; no radios,” he said, suddenly less optimistic. “If someone came here at night and killed us, no one would know about it.”
A bombing in downtown Mosul on Monday killed 10 people. A US soldier was killed in combat on Sunday, the military said, in one of the most recent of a near-daily string of attacks on US forces.
Anticipating a wave of attacks during this transition period, Iraqi soldiers and policemen were out in full strength across the country on Monday. Lines at checkpoints were longer as policemen conducted more thorough searches.
At a celebration in Baghdad’s Zahra Park, one of the largest in the country, revellers sang songs popular during the war between Iraq and Iran in 1980. “To the front lines we go,” they sang. “Our bullets in our magazines.”
Then, bobbing their heads in unison and spraying water from bottles at the crowd, they began chanting: “America has left! Baghdad is victorious!”
GE unit unveils alliance with Geron - Healthcare groups to develop stem cell technology
GE unit unveils alliance with Geron - Healthcare groups to develop stem cell technology
By Andrew Jack in London
Copyright The Financial Times Limited 2009
Published: June 30 2009 13:38 | Last updated: June 30 2009 13:38
http://www.ft.com/cms/s/0/7cb28eda-656d-11de-8e34-00144feabdc0.html
General Electric on Tuesday unveiled an exclusive alliance with Geron, the US biotechnology company, which could lead to the first significant commercial application of stem cells as soon as next year.
GE Healthcare will develop Geron’s expertise to build tests for medicines derived from human embryonic stem cells. The tests are designed to identify any toxic effects of experimental medicines, and will be sold to drug developers.
The move marks fresh momentum in long-term efforts by biotechnology groups to shift away from a heavy reliance on animal testing for new treatments. The tests could thus save time and costs in drug development, as well as ease criticism from animal rights activists.
It comes at a time when a number of biotech companies including iZumi Bio and Cellular Dynamics International are developing stem cell-related technology which could be used to help improve drug development by identifying the risks of treatment.
Other groups are using highly complex computer models in early tests to simulate the reaction of humans to new drugs as an alternative, although there is no prospect in the coming years that either approach would entirely replace tests on animals.
GE’s new alliance represents the most ambitious partnership so far using stem cell technology, signifying its confidence in what is still a niche market. It is part of an expanding range of its offerings for drug developers.
“This will be the first real economic application of stem cells,” said Konstantin Fiedler, general manager of cell technologies at GE Healthcare. “We’ll not be the only one out there but we’re very confident we will be one of the main players. We see a significant market opportunity.”
The company stressed it would not enter the arena of drug development, but has recently signed a series of partnerships with pharmaceutical companies to use its diagnostic equipment in the study and treatment of disease. It also offers instrumentation, software, reagents, training and technical support to its clients.
Geron this year became the first company to win US regulatory approval for a clinical trial examining its stem cell treatment in humans – those with severe spinal cord injuries. The group has well-established expertise in this field, allowing it to manufacture and differentiate human embryonic stem cells into specific cell types.
The initial tests of experimental drugs developed by the two companies for launch next year will help identify any effects on the heart, and a second test will look at effects on the liver – two vital organs studied closely by pharmaceutical companies and regulators.
GE and Geron would not disclose the financial terms of their alliance, which will involve some upfront payments by GE, as well as milestones and royalties for successful development and sale of the products.
David Earp, senior vice-president of business development at Geron, said: “Geron is intensely focused on developing human embryonic stem cell-based therapies and the expertise we have developed in scaleable manufacturing and differentiation … is directly applicable to the production of these cells for drug discovery.”
By Andrew Jack in London
Copyright The Financial Times Limited 2009
Published: June 30 2009 13:38 | Last updated: June 30 2009 13:38
http://www.ft.com/cms/s/0/7cb28eda-656d-11de-8e34-00144feabdc0.html
General Electric on Tuesday unveiled an exclusive alliance with Geron, the US biotechnology company, which could lead to the first significant commercial application of stem cells as soon as next year.
GE Healthcare will develop Geron’s expertise to build tests for medicines derived from human embryonic stem cells. The tests are designed to identify any toxic effects of experimental medicines, and will be sold to drug developers.
The move marks fresh momentum in long-term efforts by biotechnology groups to shift away from a heavy reliance on animal testing for new treatments. The tests could thus save time and costs in drug development, as well as ease criticism from animal rights activists.
It comes at a time when a number of biotech companies including iZumi Bio and Cellular Dynamics International are developing stem cell-related technology which could be used to help improve drug development by identifying the risks of treatment.
Other groups are using highly complex computer models in early tests to simulate the reaction of humans to new drugs as an alternative, although there is no prospect in the coming years that either approach would entirely replace tests on animals.
GE’s new alliance represents the most ambitious partnership so far using stem cell technology, signifying its confidence in what is still a niche market. It is part of an expanding range of its offerings for drug developers.
“This will be the first real economic application of stem cells,” said Konstantin Fiedler, general manager of cell technologies at GE Healthcare. “We’ll not be the only one out there but we’re very confident we will be one of the main players. We see a significant market opportunity.”
The company stressed it would not enter the arena of drug development, but has recently signed a series of partnerships with pharmaceutical companies to use its diagnostic equipment in the study and treatment of disease. It also offers instrumentation, software, reagents, training and technical support to its clients.
Geron this year became the first company to win US regulatory approval for a clinical trial examining its stem cell treatment in humans – those with severe spinal cord injuries. The group has well-established expertise in this field, allowing it to manufacture and differentiate human embryonic stem cells into specific cell types.
The initial tests of experimental drugs developed by the two companies for launch next year will help identify any effects on the heart, and a second test will look at effects on the liver – two vital organs studied closely by pharmaceutical companies and regulators.
GE and Geron would not disclose the financial terms of their alliance, which will involve some upfront payments by GE, as well as milestones and royalties for successful development and sale of the products.
David Earp, senior vice-president of business development at Geron, said: “Geron is intensely focused on developing human embryonic stem cell-based therapies and the expertise we have developed in scaleable manufacturing and differentiation … is directly applicable to the production of these cells for drug discovery.”
Crude at eight-month peak on recovery hopes - Weaker dollar boosts gold
Crude at eight-month peak on recovery hopes - Weaker dollar boosts gold
By Miles Johnson
Copyright The Financial Times Limited 2009
Published: June 30 2009 10:51 | Last updated: June 30 2009 10:51
http://www.ft.com/cms/s/0/50709b9a-655a-11de-8e34-00144feabdc0.html
Oil hit an eight-month high on Tuesday and was on track to post its largest quarterly gain since 1990 as optimism for an economic recovery rather than clear news flow continued to drive crude prices.
The energy market defied predictions of a quiet US holiday trading period as US crude again broke through $72 a barrel, adding to a 3.7 per cent rise in the previous session.
“Crude posted a strong advance yesterday proving that among all those warnings of a cautious approach, optimism about the economic outlook is still making headlines,” said Marius Paun of ODL.
“The [US] employment report on Thursday is likely to be the main influencing factor for the energy complex offering guidance on the short term.”
A softer dollar added to crude’s upward momentum, with a weaker greenback boosting the appeal of dollar-denominated commodities such as oil and gold.
Nymex West Texas Intermediate futures for August delivery, the US benchmark, rose 56 cents to $72.03, while ICE August Brent gained 66 cents to $71.65.
Earlier WTI hit $73.38 a barrel, the highest level since late October last year.
Spot gold rose 0.4 per cent to $940.50 a troy ounce, the sheen of the yellow metal enhanced by the dollar’s falls, while base metals were broadly stronger.
“Gold has stabilised against the euro over the past few sessions, recovering from a plunge at the start of last week, but sill in an overall lower trend from recent highs at the start of June,” said analysts at UBS.
Copper rose 0.8 per cent to $5143 a tonne, with aluminium up 0.7 per cent to $1651a tonne.
By Miles Johnson
Copyright The Financial Times Limited 2009
Published: June 30 2009 10:51 | Last updated: June 30 2009 10:51
http://www.ft.com/cms/s/0/50709b9a-655a-11de-8e34-00144feabdc0.html
Oil hit an eight-month high on Tuesday and was on track to post its largest quarterly gain since 1990 as optimism for an economic recovery rather than clear news flow continued to drive crude prices.
The energy market defied predictions of a quiet US holiday trading period as US crude again broke through $72 a barrel, adding to a 3.7 per cent rise in the previous session.
“Crude posted a strong advance yesterday proving that among all those warnings of a cautious approach, optimism about the economic outlook is still making headlines,” said Marius Paun of ODL.
“The [US] employment report on Thursday is likely to be the main influencing factor for the energy complex offering guidance on the short term.”
A softer dollar added to crude’s upward momentum, with a weaker greenback boosting the appeal of dollar-denominated commodities such as oil and gold.
Nymex West Texas Intermediate futures for August delivery, the US benchmark, rose 56 cents to $72.03, while ICE August Brent gained 66 cents to $71.65.
Earlier WTI hit $73.38 a barrel, the highest level since late October last year.
Spot gold rose 0.4 per cent to $940.50 a troy ounce, the sheen of the yellow metal enhanced by the dollar’s falls, while base metals were broadly stronger.
“Gold has stabilised against the euro over the past few sessions, recovering from a plunge at the start of last week, but sill in an overall lower trend from recent highs at the start of June,” said analysts at UBS.
Copper rose 0.8 per cent to $5143 a tonne, with aluminium up 0.7 per cent to $1651a tonne.
UK economy shrinks most in 50 years - First quarter GDP is revised sharply lower
UK economy shrinks most in 50 years - First quarter GDP is revised sharply lower
By Daniel Pimlott, Economics Reporter
Copyright The Financial Times Limited 2009
Published: June 30 2009 10:21 | Last updated: June 30 2009 14:37
http://www.ft.com/cms/s/0/971b65f6-6551-11de-8e34-00144feabdc0.html
The UK economy shrank by the most in more than half a century in the first three months of the year, according to revised figures which were much weaker than originally estimated.
The 2.4 per cent decline in gross domestic product was sharper than the 1.9 per cent initially calculated, the Office for National Statistics reported, and was greater than the 2.1 per cent fall expected by economists. About half the revision was due to the introduction of new construction sector data and the rest was bacause of more complete services sector figures showing a sharper decline.
Not since 1958 has the quarter-on-quarter decline in GDP been greater, while the 4.9 per cent drop compared to a year earlier was the largest since records began in 1948.
“‘You’ve never had it so bad’ seems the most apt summary of the state of the UK economy in Q1,” said Ross Walker, economist at RBS. “Although to some extent this is ‘old news’, it does serve to emphasise the size of the hole out of which the UK must climb.”
The precipitous decline in GDP in the first quarter reflected the fallout after the credit crisis escalated dramatically from September of last year onwards and highlights the depth of the recession that the UK has been suffering.
But since the end of the first quarter there have been growing signs that the economy is stabilising. Manufacturing output actually grew in March and April, while survey data suggested the economy has returned to growth.The respected economics thinktank, the National Institute for Economic and Social Research, said it thought the economy began to grow again in April.
“The survey data suggest we have at least stopped digging, but the economy remains on course for a lacklustre pace of recovery,” Mr Walker said.
The Bank of England has warned that the economy faces a slow recovery, as banks remain fragile and lending weak.
The output of the construction was revised down to show a 6.9 per cent decline from the first estimate of a 2.4 per cent drop. However, the fall in output was actually less severe than the 9 per cent fall that a more recent ONS revision had suggested, which had led many to expect GDP to be revised down sharply.
Services output, which makes up about three quarters of the UK economy, was revised down to see a drop of 1.6 per cent rather than the 1.2 per cent orginally reported.
“Revisions to GDP are larger than usual, reflecting greater uncertainty in measurement during a period of rapid change in economic activity,” the ONS said.
The GDP figures confirmed that the recession began in the second quarter of last year, after the economy shrank by 0.1 per cent in the April to June period, rather than the 0.0 per cent decline originally reported.
The economy contracted by 4.9 per cent from its peak in the first quarter until the first quarter this year. That is worse than the 2.5 per cent drop in the 1990s recession, but less than the 5.9 per cent fall in the early 1980s recession.
Despite the dramatic contraction in the economy rating agency Fitch reconfirmed the top triple-A rating on the UK’s sovereign debt at stable - along with the US, France and Germany - refusing to follow rival Standard & Poor’s which recently changed the UK’s debt outlook to negative.
The household saving ratio fell to 3 per cent from 4 per cent in the final quarter of last year, as households’ real disposable income dropped by 2.4 per cent due to lower earnings, but consumption did not fall as sharply.
Business investment fell by 7.1 per cent during the quarter. Inventories made a smaller drag of 0.4 percentage points out of the 2.4 per cent fall in GDP, compared to the previous estimate of 0.6 percentage points.
“The UK national accounts ... underline the fact that the economic recovery is built on very fragile foundations,” said Capital Economics.
“With the annual rate pulled down from -4.1 per cent to -4.9 per cent, average GDP growth in 2009 now looks likely to be -4 per cent or weaker rather than the -3.5 per cent we previously expected.
“Note too that the breakdown is not pretty, with the renewed fall in the household saving ratio from 4 per cent to 3 per cent underlining that the adjustment in the household sector has a long way yet to go.”
By Daniel Pimlott, Economics Reporter
Copyright The Financial Times Limited 2009
Published: June 30 2009 10:21 | Last updated: June 30 2009 14:37
http://www.ft.com/cms/s/0/971b65f6-6551-11de-8e34-00144feabdc0.html
The UK economy shrank by the most in more than half a century in the first three months of the year, according to revised figures which were much weaker than originally estimated.
The 2.4 per cent decline in gross domestic product was sharper than the 1.9 per cent initially calculated, the Office for National Statistics reported, and was greater than the 2.1 per cent fall expected by economists. About half the revision was due to the introduction of new construction sector data and the rest was bacause of more complete services sector figures showing a sharper decline.
Not since 1958 has the quarter-on-quarter decline in GDP been greater, while the 4.9 per cent drop compared to a year earlier was the largest since records began in 1948.
“‘You’ve never had it so bad’ seems the most apt summary of the state of the UK economy in Q1,” said Ross Walker, economist at RBS. “Although to some extent this is ‘old news’, it does serve to emphasise the size of the hole out of which the UK must climb.”
The precipitous decline in GDP in the first quarter reflected the fallout after the credit crisis escalated dramatically from September of last year onwards and highlights the depth of the recession that the UK has been suffering.
But since the end of the first quarter there have been growing signs that the economy is stabilising. Manufacturing output actually grew in March and April, while survey data suggested the economy has returned to growth.The respected economics thinktank, the National Institute for Economic and Social Research, said it thought the economy began to grow again in April.
“The survey data suggest we have at least stopped digging, but the economy remains on course for a lacklustre pace of recovery,” Mr Walker said.
The Bank of England has warned that the economy faces a slow recovery, as banks remain fragile and lending weak.
The output of the construction was revised down to show a 6.9 per cent decline from the first estimate of a 2.4 per cent drop. However, the fall in output was actually less severe than the 9 per cent fall that a more recent ONS revision had suggested, which had led many to expect GDP to be revised down sharply.
Services output, which makes up about three quarters of the UK economy, was revised down to see a drop of 1.6 per cent rather than the 1.2 per cent orginally reported.
“Revisions to GDP are larger than usual, reflecting greater uncertainty in measurement during a period of rapid change in economic activity,” the ONS said.
The GDP figures confirmed that the recession began in the second quarter of last year, after the economy shrank by 0.1 per cent in the April to June period, rather than the 0.0 per cent decline originally reported.
The economy contracted by 4.9 per cent from its peak in the first quarter until the first quarter this year. That is worse than the 2.5 per cent drop in the 1990s recession, but less than the 5.9 per cent fall in the early 1980s recession.
Despite the dramatic contraction in the economy rating agency Fitch reconfirmed the top triple-A rating on the UK’s sovereign debt at stable - along with the US, France and Germany - refusing to follow rival Standard & Poor’s which recently changed the UK’s debt outlook to negative.
The household saving ratio fell to 3 per cent from 4 per cent in the final quarter of last year, as households’ real disposable income dropped by 2.4 per cent due to lower earnings, but consumption did not fall as sharply.
Business investment fell by 7.1 per cent during the quarter. Inventories made a smaller drag of 0.4 percentage points out of the 2.4 per cent fall in GDP, compared to the previous estimate of 0.6 percentage points.
“The UK national accounts ... underline the fact that the economic recovery is built on very fragile foundations,” said Capital Economics.
“With the annual rate pulled down from -4.1 per cent to -4.9 per cent, average GDP growth in 2009 now looks likely to be -4 per cent or weaker rather than the -3.5 per cent we previously expected.
“Note too that the breakdown is not pretty, with the renewed fall in the household saving ratio from 4 per cent to 3 per cent underlining that the adjustment in the household sector has a long way yet to go.”
Pace of US housing downturn abates - Prices start to rebound in some areas
Pace of US housing downturn abates - Prices start to rebound in some areas
By Sarah O’Connor in Washington
Copyright The Financial Times Limited 2009
Published: June 30 2009 15:31 | Last updated: June 30 2009 15:31
http://www.ft.com/cms/s/0/c9dd6ac0-657e-11de-8e34-00144feabdc0.html
The pace of the US housing downturn abated in April and house prices started to rebound in some areas, supporting hopes that the worst of the crash is over.
House prices in 20 metropolitan areas fell 0.6 per cent month-on-month in April, according to the S&P Case-Shiller home-price index, following a 2.2 per cent decline a month earlier.
Prices were still 18.1 per cent lower than they were a year ago, in a sign of how savaged the housing market has been during this recession. Economists, however, were expecting a worse figure of 18.6 per cent.
“While one month’s data cannot determine if a turnaround has begun, it seems that some stabilisation may be appearing in some of the regions,” said David Blitzer, chairman of the S&P index committee. He said that people were beginning to feel more confident about the economy, which was encouraging them to buy homes. However, he warned that the spring and summer are traditionally stronger months for house prices, “so it will take some time to determine if a recovery is really here.”
Eight of the 20 areas recorded rising prices, including Dallas, Washington DC, San Francisco and Boston. Areas where prices were bumped up by speculative buying during the bubble years remained the hardest hit, such as Phoenix, Miami and Las Vegas.
The housing market has been at the epicentre of the US recession as collapsing prices kicked off a wave of defaults on parcels of mortgage debt held by banks. The Case-Schiller index has fallen by almost a third since the peak of the market in mid-2006, and many believe prices must stop falling before a broader economic recovery can begin.
”Things are bottoming,” said John Silvia, chief economist at Wachovia. “For ten to 15 of these cities, things will be positive in another month or two…Housing is going to be less of a drag on the economy but it won’t adding to it as it traditionally does.”
Some economists were more pessimistic. “We are not seeing any rebound or resurgence brewing in the housing market,” said Ken Flanagan, fixed income strategist at Morgan Stanley. “In housing, the worst is behind us, but it is an awfully deep hole we will have to climb our way out of.”
By Sarah O’Connor in Washington
Copyright The Financial Times Limited 2009
Published: June 30 2009 15:31 | Last updated: June 30 2009 15:31
http://www.ft.com/cms/s/0/c9dd6ac0-657e-11de-8e34-00144feabdc0.html
The pace of the US housing downturn abated in April and house prices started to rebound in some areas, supporting hopes that the worst of the crash is over.
House prices in 20 metropolitan areas fell 0.6 per cent month-on-month in April, according to the S&P Case-Shiller home-price index, following a 2.2 per cent decline a month earlier.
Prices were still 18.1 per cent lower than they were a year ago, in a sign of how savaged the housing market has been during this recession. Economists, however, were expecting a worse figure of 18.6 per cent.
“While one month’s data cannot determine if a turnaround has begun, it seems that some stabilisation may be appearing in some of the regions,” said David Blitzer, chairman of the S&P index committee. He said that people were beginning to feel more confident about the economy, which was encouraging them to buy homes. However, he warned that the spring and summer are traditionally stronger months for house prices, “so it will take some time to determine if a recovery is really here.”
Eight of the 20 areas recorded rising prices, including Dallas, Washington DC, San Francisco and Boston. Areas where prices were bumped up by speculative buying during the bubble years remained the hardest hit, such as Phoenix, Miami and Las Vegas.
The housing market has been at the epicentre of the US recession as collapsing prices kicked off a wave of defaults on parcels of mortgage debt held by banks. The Case-Schiller index has fallen by almost a third since the peak of the market in mid-2006, and many believe prices must stop falling before a broader economic recovery can begin.
”Things are bottoming,” said John Silvia, chief economist at Wachovia. “For ten to 15 of these cities, things will be positive in another month or two…Housing is going to be less of a drag on the economy but it won’t adding to it as it traditionally does.”
Some economists were more pessimistic. “We are not seeing any rebound or resurgence brewing in the housing market,” said Ken Flanagan, fixed income strategist at Morgan Stanley. “In housing, the worst is behind us, but it is an awfully deep hole we will have to climb our way out of.”
Live: Oil companies bid for Iraq’s oil fields - Rest of landmark auction is less successful
Live: Oil companies bid for Iraq’s oil fields - Rest of landmark auction is less successful
By Carola Hoyos
Copyright The Financial Times Limited 2009
June 30, 2009 2:42pm
http://blogs.ft.com/energy-source/2009/06/30/live-oil-companies-bid-for-iraqs-oil-fields/
BP and CNPC have won the right to help Iraq develop the Rumaila field. The UK and Chinese companies beat ExxonMobil, the US oil company, which had partnered with Petronas, the Malaysian oil company. BP clinched the contract when it agreed to reduce its fee per barrel from $3.99 to $2.
But the rest of the auction has not gone as smoothly. In fact, so far, the smaller five of the eight oil and gas fields being auctioned off have failed to find a company willing to accept the narrow terms and the relatively low price Iraq is willing to pay for their services. And the future of West Qurna, the biggest of the fields, is looking in doubt after ExxonMobil and CNPC both rejected Iraq’s tougher terms. Royal Dutch Shell has bid for Kirkuk, bit no winner has been announced for that field.
Today had marked the beginning of a long-awaited journey. Braving sand storms and the continued violence on Iraq’s streets, oil executives had come to Baghdad to make their bids. It was the first time since nationalisation more than 30 years ago that international oil companies would be allowed back into the country.
After much debate, Iraq had decided to allow foreign oil companies to help repair its oil developments, which have been plagued by years of war, sanctions and violence. The companies will be paid a fee for their service, but they hope their willingness to accept such narrow terms eventually could lead to more lucrative exploration and development deals.
Kicking off the bidding ceremony, Nuri Al-Maliki, the country’s prime minister, promised Iraq would make even more fields available to international companies that want to develop them.
Bid envelopes for the fields were opened every 45 minutes to an hour. They contained two numbers - the per barrel fee the company proposes to charge Iraq for helping repair the field and the point at which it believes the field will plateau.
The plateau is not only an engineering ambition, but also decides at what point companies begin to make money. Thus the lower the first number and the higher the second, the more likely the bid would win the contract.
Here is the line-up for other contracts auctioned so far:
The Mansuriyah gas field got no bids.
There were four bids from different consortia for the Zubair oilfield. But in the end the winning bidder rejected the terms on which Iraq was insisting and the field went unawarded. The groups that had initially bid were BP , together with CNPC; India’s ONGC with Gazprom Russia and Turkish Petroleum Corp. The third was headed by Italy’s ENI, with China’s Sinopec, Occidental and Korean Gas; and the fourth was led by Exxon Mobil, with Royal Dutch Shell and Petronas.
The Maysan field failed to find a developer as Iraq and the single consortium that bid (Cnooc and Sinochem) could not agree the terms.
The Kirkuk field got one bid by a group led by Royal Dutch Shell and including Sinopec and the Turkish Petroleum Corp.
The Bai Hassan failed to find a developer as Iraq and the ConocoPhillips-led consortium that bid on it failed to agree terms.
The West Qurna field got five bids, but its future hangs in the balance after ExxonMobil and CNPC both rejected Iraq’s tougher terms.
The Akkas gas field got one bid from a group led by Edison.
The the group led by Cnooc, the Chinese oil company, that bid on the Missan oil field, ended up rejecting Iraq’s tougher terms.
By Carola Hoyos
Copyright The Financial Times Limited 2009
June 30, 2009 2:42pm
http://blogs.ft.com/energy-source/2009/06/30/live-oil-companies-bid-for-iraqs-oil-fields/
BP and CNPC have won the right to help Iraq develop the Rumaila field. The UK and Chinese companies beat ExxonMobil, the US oil company, which had partnered with Petronas, the Malaysian oil company. BP clinched the contract when it agreed to reduce its fee per barrel from $3.99 to $2.
But the rest of the auction has not gone as smoothly. In fact, so far, the smaller five of the eight oil and gas fields being auctioned off have failed to find a company willing to accept the narrow terms and the relatively low price Iraq is willing to pay for their services. And the future of West Qurna, the biggest of the fields, is looking in doubt after ExxonMobil and CNPC both rejected Iraq’s tougher terms. Royal Dutch Shell has bid for Kirkuk, bit no winner has been announced for that field.
Today had marked the beginning of a long-awaited journey. Braving sand storms and the continued violence on Iraq’s streets, oil executives had come to Baghdad to make their bids. It was the first time since nationalisation more than 30 years ago that international oil companies would be allowed back into the country.
After much debate, Iraq had decided to allow foreign oil companies to help repair its oil developments, which have been plagued by years of war, sanctions and violence. The companies will be paid a fee for their service, but they hope their willingness to accept such narrow terms eventually could lead to more lucrative exploration and development deals.
Kicking off the bidding ceremony, Nuri Al-Maliki, the country’s prime minister, promised Iraq would make even more fields available to international companies that want to develop them.
Bid envelopes for the fields were opened every 45 minutes to an hour. They contained two numbers - the per barrel fee the company proposes to charge Iraq for helping repair the field and the point at which it believes the field will plateau.
The plateau is not only an engineering ambition, but also decides at what point companies begin to make money. Thus the lower the first number and the higher the second, the more likely the bid would win the contract.
Here is the line-up for other contracts auctioned so far:
The Mansuriyah gas field got no bids.
There were four bids from different consortia for the Zubair oilfield. But in the end the winning bidder rejected the terms on which Iraq was insisting and the field went unawarded. The groups that had initially bid were BP , together with CNPC; India’s ONGC with Gazprom Russia and Turkish Petroleum Corp. The third was headed by Italy’s ENI, with China’s Sinopec, Occidental and Korean Gas; and the fourth was led by Exxon Mobil, with Royal Dutch Shell and Petronas.
The Maysan field failed to find a developer as Iraq and the single consortium that bid (Cnooc and Sinochem) could not agree the terms.
The Kirkuk field got one bid by a group led by Royal Dutch Shell and including Sinopec and the Turkish Petroleum Corp.
The Bai Hassan failed to find a developer as Iraq and the ConocoPhillips-led consortium that bid on it failed to agree terms.
The West Qurna field got five bids, but its future hangs in the balance after ExxonMobil and CNPC both rejected Iraq’s tougher terms.
The Akkas gas field got one bid from a group led by Edison.
The the group led by Cnooc, the Chinese oil company, that bid on the Missan oil field, ended up rejecting Iraq’s tougher terms.
Eurozone inflation turns negative - Complicates ECB rate setting decision
Eurozone inflation turns negative - Complicates ECB rate setting decision
By Ralph Atkins in Frankfurt
Published: June 30 2009 11:03 | Last updated: June 30 2009 11:03
http://www.ft.com/cms/s/0/e52098b2-655a-11de-8e34-00144feabdc0.html
Eurozone annual inflation has turned negative for the first time, complicating the job of the European Central Bank as draws a line under emergency measures to tackle continental Europe’s recession.
Consumer prices in the 16-country eurozone were 0.1 per cent lower in June than the same month a year before, according to Eurostat, the European Union’s statistical office.
It was the first time eurozone annual inflation had fallen below zero since comparable records began in 1991. Inflationary pressures in continental Europe are now lower than at anytime since at least the early 1950s, according to calculations by some economists.
The fall in prices reflected sharply lower energy costs but also the effects of the worst post-war economic downturn. The US had already reported year-on-year falls in consumer prices.
News that inflation had turned negative – and was massively undershooting the ECB’s target of an annual rate “below but close” to 2 per cent - came as the ECB prepares for Thursday’s interest rate setting meeting in Luxembourg.
Since last October, the ECB has slashed its main policy rate by 325 basis points to 1 per cent, and pledged to meet in full banks’ demands for liquidity – which resulted in it last week pumping €442bn in one-year loans in the banking system.
But the ECB’s governing council is not expected to cut official borrowing costs further at this week’s meeting and analysts expect the main policy rate to remain at 1 per cent for many months – possibly well into next year or even beyond.
The ECB believes the impact of its measures have still to feed through into the economy. But it faces a difficult balancing act. Even though the inflation outlook justified further action, the central bank feared “that more aggressive easing now could risk financial stability and or a too sharp acceleration of inflation over the longer-term,” said Nick Kounis, European Economist at Fortis Bank.
Jean-Claude Trichet, ECB president, is likely to stress on Thursday that negative inflation will be only a temporary with a return to positive annual rates expected later this year. But ECB forecasts show inflation remaining well below 2 per cent in 2010 and the worry for ECB policymakers is that months of below-zero inflation rates will stoke fears of full-blown deflation – generalised and persistent falls in prices that wreak significant economic damage.
Meanwhile, credit figures released by the ECB just ahead of the inflation news highlighted how the liquidity it has pumped into the banking system have not yet stopped credit flows to the economy from being thrown into reverse. Businesses repaid a net €5bn in loans in May, slowing the annual rate of growth in such loans to just 4.4 per cent. Even more dramatically, the annual rate of growth of borrowing by households turned negative, with loans down 0.2 per cent on the year.
The ECB has been stepping up its appeals recently for banks to pass on the extra liquidity they have been lent, but it could be some months before any extra lending to businesses and households shows up in official data.
Copyright The Financial Times Limited 2009
By Ralph Atkins in Frankfurt
Published: June 30 2009 11:03 | Last updated: June 30 2009 11:03
http://www.ft.com/cms/s/0/e52098b2-655a-11de-8e34-00144feabdc0.html
Eurozone annual inflation has turned negative for the first time, complicating the job of the European Central Bank as draws a line under emergency measures to tackle continental Europe’s recession.
Consumer prices in the 16-country eurozone were 0.1 per cent lower in June than the same month a year before, according to Eurostat, the European Union’s statistical office.
It was the first time eurozone annual inflation had fallen below zero since comparable records began in 1991. Inflationary pressures in continental Europe are now lower than at anytime since at least the early 1950s, according to calculations by some economists.
The fall in prices reflected sharply lower energy costs but also the effects of the worst post-war economic downturn. The US had already reported year-on-year falls in consumer prices.
News that inflation had turned negative – and was massively undershooting the ECB’s target of an annual rate “below but close” to 2 per cent - came as the ECB prepares for Thursday’s interest rate setting meeting in Luxembourg.
Since last October, the ECB has slashed its main policy rate by 325 basis points to 1 per cent, and pledged to meet in full banks’ demands for liquidity – which resulted in it last week pumping €442bn in one-year loans in the banking system.
But the ECB’s governing council is not expected to cut official borrowing costs further at this week’s meeting and analysts expect the main policy rate to remain at 1 per cent for many months – possibly well into next year or even beyond.
The ECB believes the impact of its measures have still to feed through into the economy. But it faces a difficult balancing act. Even though the inflation outlook justified further action, the central bank feared “that more aggressive easing now could risk financial stability and or a too sharp acceleration of inflation over the longer-term,” said Nick Kounis, European Economist at Fortis Bank.
Jean-Claude Trichet, ECB president, is likely to stress on Thursday that negative inflation will be only a temporary with a return to positive annual rates expected later this year. But ECB forecasts show inflation remaining well below 2 per cent in 2010 and the worry for ECB policymakers is that months of below-zero inflation rates will stoke fears of full-blown deflation – generalised and persistent falls in prices that wreak significant economic damage.
Meanwhile, credit figures released by the ECB just ahead of the inflation news highlighted how the liquidity it has pumped into the banking system have not yet stopped credit flows to the economy from being thrown into reverse. Businesses repaid a net €5bn in loans in May, slowing the annual rate of growth in such loans to just 4.4 per cent. Even more dramatically, the annual rate of growth of borrowing by households turned negative, with loans down 0.2 per cent on the year.
The ECB has been stepping up its appeals recently for banks to pass on the extra liquidity they have been lent, but it could be some months before any extra lending to businesses and households shows up in official data.
Copyright The Financial Times Limited 2009
Monday, June 29, 2009
Chicago Tribune Editorial: Independence Day
Chicago Tribune Editorial: Independence Day
Copyright © 2009, Chicago Tribune
June 29, 2009
http://www.chicagotribune.com/news/opinion/editorials/chi-0629edit1jun29,0,2051456.story
Iraq Prime Minister Nouri al-Maliki has declared Tuesday to be a national holiday, promising feasts and festivals to celebrate the withdrawal of American combat troops from Iraq's cities. For Iraqis, it's a sort of Independence Day.
But that's cause for an American celebration, too. Although American troops will remain in Iraq for training and support missions, the Iraqis now step to the fore, charged with the security of their country. For America, this is the beginning of the end of the Iraq war.
How did we get to this hopeful moment? President George W. Bush set the stage for this transfer of responsibility with the 2007 surge of American troops to quash sectarian violence in Baghdad. It worked. President Barack Obama wisely has hewed to a gradual, reasonable schedule for an American withdrawal, allowing the Iraqis enough time to develop their forces. The Iraqis themselves pushed back from the brink of civil war. With American help, they uprooted Al Qaeda and its culture of death. They embraced democracy, turning out in thrilling numbers to elect government leaders. By almost every measure, Iraq is more peaceful, prosperous and free than it has been in decades. Despite a spasm of bombings in recent days, violence is down significantly:
In May 2007, in the early stages of the surge, 126 U.S. troops were killed in Iraq, according to a Brookings Institution tally. In May 2009, that number was 25. In May of 2007, 197 Iraqi security forces died. May 2009: 39.
Most telling of all: Iraqi civilian deaths from the war. In May 2007: 2,600. In May 2009: 340.
There are also economic measures of the country's progress: Electricity production has soared since May of 2007. Iraq's oil industry is recovering; the country is set to auction development rights to some of its largest oil fields to foreign companies.
All of that would be impossible without political advances, without Sunnis, Shiites and Kurds hashing out differences and agreeing to share power.
A caution: There's still much political and military work to be accomplished by Iraqis who have to prove they can do it. Coalitions can crumble and, as we've seen with the resurgent Taliban in Afghanistan, terrorists and insurgents can regroup.
Preventing that is now Iraq's challenge.
U.S. commanders say decisions about Americans in Iraq -- where they are, what they do -- now rest with the Iraqis. "We will be gone in whatever way the Iraqi government tells us to be gone," Lt. Col. Timothy M. Karcher told a reporter.
That certainly is everyone's hope: a continuing success story with no need for U.S. troops to return to the cities en masse. The American commanders don't want to go back into Iraq's cities, nor do Iraq's leaders want them there.
Predicting how well Iraq will quell its demons is treacherous. But we do know this: By the end of 2011, all U.S. troops are scheduled to leave Iraq.
They will leave a country that was broken, but is now on the mend. They will leave Iraq to its people and their impressive determination to be free.
Copyright © 2009, Chicago Tribune
June 29, 2009
http://www.chicagotribune.com/news/opinion/editorials/chi-0629edit1jun29,0,2051456.story
Iraq Prime Minister Nouri al-Maliki has declared Tuesday to be a national holiday, promising feasts and festivals to celebrate the withdrawal of American combat troops from Iraq's cities. For Iraqis, it's a sort of Independence Day.
But that's cause for an American celebration, too. Although American troops will remain in Iraq for training and support missions, the Iraqis now step to the fore, charged with the security of their country. For America, this is the beginning of the end of the Iraq war.
How did we get to this hopeful moment? President George W. Bush set the stage for this transfer of responsibility with the 2007 surge of American troops to quash sectarian violence in Baghdad. It worked. President Barack Obama wisely has hewed to a gradual, reasonable schedule for an American withdrawal, allowing the Iraqis enough time to develop their forces. The Iraqis themselves pushed back from the brink of civil war. With American help, they uprooted Al Qaeda and its culture of death. They embraced democracy, turning out in thrilling numbers to elect government leaders. By almost every measure, Iraq is more peaceful, prosperous and free than it has been in decades. Despite a spasm of bombings in recent days, violence is down significantly:
In May 2007, in the early stages of the surge, 126 U.S. troops were killed in Iraq, according to a Brookings Institution tally. In May 2009, that number was 25. In May of 2007, 197 Iraqi security forces died. May 2009: 39.
Most telling of all: Iraqi civilian deaths from the war. In May 2007: 2,600. In May 2009: 340.
There are also economic measures of the country's progress: Electricity production has soared since May of 2007. Iraq's oil industry is recovering; the country is set to auction development rights to some of its largest oil fields to foreign companies.
All of that would be impossible without political advances, without Sunnis, Shiites and Kurds hashing out differences and agreeing to share power.
A caution: There's still much political and military work to be accomplished by Iraqis who have to prove they can do it. Coalitions can crumble and, as we've seen with the resurgent Taliban in Afghanistan, terrorists and insurgents can regroup.
Preventing that is now Iraq's challenge.
U.S. commanders say decisions about Americans in Iraq -- where they are, what they do -- now rest with the Iraqis. "We will be gone in whatever way the Iraqi government tells us to be gone," Lt. Col. Timothy M. Karcher told a reporter.
That certainly is everyone's hope: a continuing success story with no need for U.S. troops to return to the cities en masse. The American commanders don't want to go back into Iraq's cities, nor do Iraq's leaders want them there.
Predicting how well Iraq will quell its demons is treacherous. But we do know this: By the end of 2011, all U.S. troops are scheduled to leave Iraq.
They will leave a country that was broken, but is now on the mend. They will leave Iraq to its people and their impressive determination to be free.
Chicago gay pride parade glows in its growing acceptance - Gay community's parade celebrates its 40th anniversary
Chicago gay pride parade glows in its growing acceptance - Gay community's parade celebrates its 40th anniversary
By Rex W. Huppke
Copyright © 2009, Chicago Tribune
June 29, 2009
http://www.chicagotribune.com/news/local/chi-gay-pride-parade-29-jun29,0,6022615.story
Gay pride marched Sunday in Chicago, noisy and joyous. It was the crash of marching band cymbals, the megaphoned whoops of celebration, the sirens, the car horns and the ground-shaking roar of Harleys straddled by leather-clad women unabashed.
It was smiling faces striped in rainbow colors, sweaty brows turned to face a cool summer breeze, women hand-in-hand, men kissing men, children on the shoulders of straight parents, dazzled by the flags and shimmering floats and dancers that filled North Halsted Street.
Pride was remarkable on Sunday, tens of thousands drawn together to celebrate the 40th anniversary of a parade that, when it first happened, was barely a parade at all.
Those in Chicago's first gay pride parade in 1970 were just a bold but loosely organized stream of activists and drag queens who marched the sidewalk along North Halsted Street, shouting and vamping for gay rights.
They did it again the next year and the next. People driving past would gape, a few might cheer from storefronts.
But each year it grew.
Now the parade consumes the street with color and sound. The sidewalk is for spectators, so many that metal barricades are linked together to keep them at bay.
Often lost in the carnival atmosphere is the reason those first women and men stepped out of the closet when it was dangerous to admit you were anything but straight.
The first gay pride parades -- here and across the country -- came the year after the Stonewall riots of 1969, when gays and lesbians stood up to New York City police outside a Greenwich Village bar, birthing the gay rights movement.
Sunday's parade displayed the cumulative impact of that movement. The traditionally flamboyant floats of bare-chested men and near-bare-chested women were flanked by floats carrying straight politicians and gay and lesbian police officers, church groups and, for the first time, a coalition of parents -- gay, straight and lesbian -- from a Chicago public school.
The parade now pulls the curtain back on Chicago's gay, lesbian, bisexual and transgender community and shows its diversity: Republicans and Democrats; Christians and atheists; buttoned-down businesspeople and outlandish artists.
David Sinski gazed down at the river of humanity on North Halsted Street from the third-floor balcony of the Center on Halsted, a GLBT community center, the very idea of which was once impossible to imagine.
"Twenty years ago, this was a very solitary event," said Sinski, 46. "You'd come along with like-minded people. But now there are so many straight people, politicians, corporations, youth groups. Now there are so many things that just aren't questioned. It's much more of a celebration."
Nettelhorst Elementary School parents marched near the front of the parade, leaving behind a wave of bubbles. One kid-filled wagon was topped with a sign that read: "School is out and so are my dads."
Veterans marched, some in full uniform.
There were straight parents with gay kids and gay parents with straight kids and an undeniable sense that, at least in this swath of Chicago on this day, people could be wholly themselves.
Cynthia Lafuente, embraced by a girlfriend from Texas, felt that way: "We can just be free. No worries, no judgments."
Nikki Carlton came out when she was 16. She's now 52 and drove in from Glen Ellyn not so much to see the floats and dancers but to immerse herself in the spirit of the parade: "This shows there's growing acceptance. I think, over the years, this has widened people's eyes about us. They see us as people, as not threatening. They come here and realize we won't turn them gay."
Over three hours, nearly 240 entrants followed the parade route, cheered on by crowds that clogged sidewalks and jammed the balconies of apartments above. At times multicolored confetti rained down and colorful beads were tossed about and balloons drifted off.
Pride was noisy and joyous on Sunday, messy and unpredictable, colorful and exhausting, 40 years old and going strong.
rhuppke@tribune.com
By Rex W. Huppke
Copyright © 2009, Chicago Tribune
June 29, 2009
http://www.chicagotribune.com/news/local/chi-gay-pride-parade-29-jun29,0,6022615.story
Gay pride marched Sunday in Chicago, noisy and joyous. It was the crash of marching band cymbals, the megaphoned whoops of celebration, the sirens, the car horns and the ground-shaking roar of Harleys straddled by leather-clad women unabashed.
It was smiling faces striped in rainbow colors, sweaty brows turned to face a cool summer breeze, women hand-in-hand, men kissing men, children on the shoulders of straight parents, dazzled by the flags and shimmering floats and dancers that filled North Halsted Street.
Pride was remarkable on Sunday, tens of thousands drawn together to celebrate the 40th anniversary of a parade that, when it first happened, was barely a parade at all.
Those in Chicago's first gay pride parade in 1970 were just a bold but loosely organized stream of activists and drag queens who marched the sidewalk along North Halsted Street, shouting and vamping for gay rights.
They did it again the next year and the next. People driving past would gape, a few might cheer from storefronts.
But each year it grew.
Now the parade consumes the street with color and sound. The sidewalk is for spectators, so many that metal barricades are linked together to keep them at bay.
Often lost in the carnival atmosphere is the reason those first women and men stepped out of the closet when it was dangerous to admit you were anything but straight.
The first gay pride parades -- here and across the country -- came the year after the Stonewall riots of 1969, when gays and lesbians stood up to New York City police outside a Greenwich Village bar, birthing the gay rights movement.
Sunday's parade displayed the cumulative impact of that movement. The traditionally flamboyant floats of bare-chested men and near-bare-chested women were flanked by floats carrying straight politicians and gay and lesbian police officers, church groups and, for the first time, a coalition of parents -- gay, straight and lesbian -- from a Chicago public school.
The parade now pulls the curtain back on Chicago's gay, lesbian, bisexual and transgender community and shows its diversity: Republicans and Democrats; Christians and atheists; buttoned-down businesspeople and outlandish artists.
David Sinski gazed down at the river of humanity on North Halsted Street from the third-floor balcony of the Center on Halsted, a GLBT community center, the very idea of which was once impossible to imagine.
"Twenty years ago, this was a very solitary event," said Sinski, 46. "You'd come along with like-minded people. But now there are so many straight people, politicians, corporations, youth groups. Now there are so many things that just aren't questioned. It's much more of a celebration."
Nettelhorst Elementary School parents marched near the front of the parade, leaving behind a wave of bubbles. One kid-filled wagon was topped with a sign that read: "School is out and so are my dads."
Veterans marched, some in full uniform.
There were straight parents with gay kids and gay parents with straight kids and an undeniable sense that, at least in this swath of Chicago on this day, people could be wholly themselves.
Cynthia Lafuente, embraced by a girlfriend from Texas, felt that way: "We can just be free. No worries, no judgments."
Nikki Carlton came out when she was 16. She's now 52 and drove in from Glen Ellyn not so much to see the floats and dancers but to immerse herself in the spirit of the parade: "This shows there's growing acceptance. I think, over the years, this has widened people's eyes about us. They see us as people, as not threatening. They come here and realize we won't turn them gay."
Over three hours, nearly 240 entrants followed the parade route, cheered on by crowds that clogged sidewalks and jammed the balconies of apartments above. At times multicolored confetti rained down and colorful beads were tossed about and balloons drifted off.
Pride was noisy and joyous on Sunday, messy and unpredictable, colorful and exhausting, 40 years old and going strong.
rhuppke@tribune.com
Out of the Closet and Into Congress? - A conversation with former soldier Anthony Woods
Out of the Closet and Into Congress? - A conversation with former soldier Anthony Woods
Copyright by The washington Post
Sunday, June 28, 2009
http://www.washingtonpost.com/wp-dyn/content/article/2009/06/26/AR2009062603526.html
With California Democrat Ellen Tauscher heading to the State Department, former Army captain and West Point grad Anthony Woods has set his sights on her congressional seat. After two tours in Iraq, Woods came out of the closet and had to leave the military. Outlook's Rachel Dry spoke with him about the Obama administration's position on gay rights, the 40th anniversary of the Stonewall riots and why "don't ask, don't tell" is the least of the president's problems. Excerpts:
Why did you decide to come out?
That was one of the toughest choices I had to make in my entire life. I struggled with it, because I knew that my decision would ultimately cost me something that I really loved -- my career in the military. And you know I weighed that with the very real fact that the "don't ask, don't tell" policy is asking people to lie, and there's something that's fundamentally wrong with a policy that's encouraging people to compromise their integrity and to lie about who they are.
When it was first implemented, the policy was allegedly supposed to preserve morale and unit cohesion. How does that fit in with your experience in Iraq?
The thing that soldiers care about is, is their leader competent and does he or she care about them. And if they had a choice between a straight superior who was not very good at their job or a gay superior who was very good at their job, I think they would choose the one who's going to help ensure that they come home to their families.
You volunteered for the Obama campaign. What do you think of his administration's position on gay rights?
My response to anyone who would want to complain about the speed in which he's doing things is, yes, I want him to come around on issues that are important to me from a personal perspective, but he's got to confront climate change, the economy, we've got wars in Iraq and Afghanistan. There are things that they've had eight years to undo and he's had a few months to get us back on the right direction.
How long will it take for "don't ask, don't tell" to be history?
Of all the huge problems that he's confronting, I actually think this one is the easiest. Look, we're a country at war fighting in two different places and trying to combat terrorism all around the world. We need every able-bodied American who wants to serve their country to be allowed to do so.
What is it like talking to California voters about gay rights issues?
People are frustrated with Proposition 8 [outlawing gay marriage in California], and I share their frustrations. Prop 8 is going to be defeated in the future when we build a coalition of African Americans and Hispanics and folks from every swath of life in California.
A number of stories after the election speculated that increased turnout among African American voters helped lead to the passage of Proposition 8.
It's not at all helpful for the LGBT community, right or wrong, to scapegoat the African American community. That's the exact group of people who you need to speak to immediately and get them on board. What I hope I can do in the future is be a bridge for that. I'm a member of both of those communities and that's how we're going to be able to start speaking to each other in a language we both understand.
What's your sense of the gay rights movement now, on the 40th anniversary of the Stonewall riots?
I think we're making very real progress, and I think there is still reason to be optimistic and excited, because we do have a pretty fantastic president in office, and I do believe that he wants to get things right on issues that are important to the LGBT community.
People have been saying that your life is a little bit too much like a made-for-TV movie.
Yeah, I get that sometimes. I guess when you put anyone's life in one sentence it sounds a bit much. For me it's just, you know, this is my life and it's been a fun journey. It is what it is.
Copyright by The washington Post
Sunday, June 28, 2009
http://www.washingtonpost.com/wp-dyn/content/article/2009/06/26/AR2009062603526.html
With California Democrat Ellen Tauscher heading to the State Department, former Army captain and West Point grad Anthony Woods has set his sights on her congressional seat. After two tours in Iraq, Woods came out of the closet and had to leave the military. Outlook's Rachel Dry spoke with him about the Obama administration's position on gay rights, the 40th anniversary of the Stonewall riots and why "don't ask, don't tell" is the least of the president's problems. Excerpts:
Why did you decide to come out?
That was one of the toughest choices I had to make in my entire life. I struggled with it, because I knew that my decision would ultimately cost me something that I really loved -- my career in the military. And you know I weighed that with the very real fact that the "don't ask, don't tell" policy is asking people to lie, and there's something that's fundamentally wrong with a policy that's encouraging people to compromise their integrity and to lie about who they are.
When it was first implemented, the policy was allegedly supposed to preserve morale and unit cohesion. How does that fit in with your experience in Iraq?
The thing that soldiers care about is, is their leader competent and does he or she care about them. And if they had a choice between a straight superior who was not very good at their job or a gay superior who was very good at their job, I think they would choose the one who's going to help ensure that they come home to their families.
You volunteered for the Obama campaign. What do you think of his administration's position on gay rights?
My response to anyone who would want to complain about the speed in which he's doing things is, yes, I want him to come around on issues that are important to me from a personal perspective, but he's got to confront climate change, the economy, we've got wars in Iraq and Afghanistan. There are things that they've had eight years to undo and he's had a few months to get us back on the right direction.
How long will it take for "don't ask, don't tell" to be history?
Of all the huge problems that he's confronting, I actually think this one is the easiest. Look, we're a country at war fighting in two different places and trying to combat terrorism all around the world. We need every able-bodied American who wants to serve their country to be allowed to do so.
What is it like talking to California voters about gay rights issues?
People are frustrated with Proposition 8 [outlawing gay marriage in California], and I share their frustrations. Prop 8 is going to be defeated in the future when we build a coalition of African Americans and Hispanics and folks from every swath of life in California.
A number of stories after the election speculated that increased turnout among African American voters helped lead to the passage of Proposition 8.
It's not at all helpful for the LGBT community, right or wrong, to scapegoat the African American community. That's the exact group of people who you need to speak to immediately and get them on board. What I hope I can do in the future is be a bridge for that. I'm a member of both of those communities and that's how we're going to be able to start speaking to each other in a language we both understand.
What's your sense of the gay rights movement now, on the 40th anniversary of the Stonewall riots?
I think we're making very real progress, and I think there is still reason to be optimistic and excited, because we do have a pretty fantastic president in office, and I do believe that he wants to get things right on issues that are important to the LGBT community.
People have been saying that your life is a little bit too much like a made-for-TV movie.
Yeah, I get that sometimes. I guess when you put anyone's life in one sentence it sounds a bit much. For me it's just, you know, this is my life and it's been a fun journey. It is what it is.
Washington Post Editorial: China's Information Dam - Should Yahoo, Google and Microsoft help the censors?
Washington Post Editorial: China's Information Dam - Should Yahoo, Google and Microsoft help the censors?
Copyright by The Washington Post
Monday, June 29, 2009
http://www.washingtonpost.com/wp-dyn/content/article/2009/06/28/AR2009062802398.html
"IT IS NOT our job to fix the Chinese government," Yahoo CEO Carol Bartz said last week. Maybe not. But search engines operating in China face a dilemma come July. Starting Wednesday, China is embarking on a broad initiative to clamp down on Web content the government views as obscene, billing these efforts as a fight against pornography. For Chinese officials, there has always been an overlap between pornography and references to politically sensitive topics such as the Falun Gong and Tiananmen Square. June traditionally marks a crackdown in China's Web censorship as the country brings down sites such as You Tube (inaccessible since March) and Twitter for the anniversary of the Tiananmen Square massacre. But more is in the works.
The plan? Fine and shut down all sites offering unapproved information on sexual health, command Google to close access to foreign Web sites and push for the pre-installation of censorship software called "Green Dam" on all computers. As this list reveals, China's Web censorship efforts go far beyond the stated goal of protecting against pornography.
Foreign companies are drawn to China's market of more than 200 million Internet users. But the conditions of doing business in China are complicated: Content providers must agree to abide by China's draconian restrictions on the kind of results they can show. Both Bing and Google's sites acknowledge that results have been removed. Their justification is simple: If we don't do it, someone else will.
But this is not necessarily true. In 1996, state news agency Xinhua tried to place restrictions on breaking financial news, moving to prohibit all stories not vetted by its propaganda machine. A concerted pushback by the international media and other stockholders prevailed against the initiative.
This time, the State Department and industry groups are pushing back against China's Green Dam censorship software. They must stand firm, and search engines should join them. The industry can offer China better alternatives to meet its avowed aim of limiting access to pornography. But closing access to sexual-health Web sites is both wrong and dangerous. Fining people who fail to meet government criteria for the information they post could have devastating repercussions. And enhancing China's ability to persecute those who seek freedom is not forgivable.
It may not be companies' job to fix the Chinese government. But if they choose to do business in China, it is their job to serve the Chinese people.
Copyright by The Washington Post
Monday, June 29, 2009
http://www.washingtonpost.com/wp-dyn/content/article/2009/06/28/AR2009062802398.html
"IT IS NOT our job to fix the Chinese government," Yahoo CEO Carol Bartz said last week. Maybe not. But search engines operating in China face a dilemma come July. Starting Wednesday, China is embarking on a broad initiative to clamp down on Web content the government views as obscene, billing these efforts as a fight against pornography. For Chinese officials, there has always been an overlap between pornography and references to politically sensitive topics such as the Falun Gong and Tiananmen Square. June traditionally marks a crackdown in China's Web censorship as the country brings down sites such as You Tube (inaccessible since March) and Twitter for the anniversary of the Tiananmen Square massacre. But more is in the works.
The plan? Fine and shut down all sites offering unapproved information on sexual health, command Google to close access to foreign Web sites and push for the pre-installation of censorship software called "Green Dam" on all computers. As this list reveals, China's Web censorship efforts go far beyond the stated goal of protecting against pornography.
Foreign companies are drawn to China's market of more than 200 million Internet users. But the conditions of doing business in China are complicated: Content providers must agree to abide by China's draconian restrictions on the kind of results they can show. Both Bing and Google's sites acknowledge that results have been removed. Their justification is simple: If we don't do it, someone else will.
But this is not necessarily true. In 1996, state news agency Xinhua tried to place restrictions on breaking financial news, moving to prohibit all stories not vetted by its propaganda machine. A concerted pushback by the international media and other stockholders prevailed against the initiative.
This time, the State Department and industry groups are pushing back against China's Green Dam censorship software. They must stand firm, and search engines should join them. The industry can offer China better alternatives to meet its avowed aim of limiting access to pornography. But closing access to sexual-health Web sites is both wrong and dangerous. Fining people who fail to meet government criteria for the information they post could have devastating repercussions. And enhancing China's ability to persecute those who seek freedom is not forgivable.
It may not be companies' job to fix the Chinese government. But if they choose to do business in China, it is their job to serve the Chinese people.
Pride at the White House
Pride at the White House
By Jarrett Barrios
Copyright by The Washington Post
Monday, June 29, 2009; 12:00 AM
http://www.washingtonpost.com/wp-dyn/content/article/2009/06/28/AR2009062802336.html
The Stonewall Riots of 1969 -- when patrons at a New York city gay bar fought back against police brutality and harassment and set in motion a wave of activism -- have been commemorated in various ways. There have been protests, rallies, academic lectures and parties. Today is the first time Stonewall will be remembered in the tony quarters of the White House.
I have to admit I was ambivalent when I received the invitation, with its fancy curlicue script (truly, just like my sister's wedding announcement) and a return address that read simply "The White House." The problem is that I haven't been as excited as I'd like to be about President Obama. I'd been excited by Candidate Obama. His campaign invited people like me and my husband Doug -- gay, lesbian, bisexual and transgender Americans -- into his aspirational vision of America the Possible. But, as President Obama, he has presided over an administration that has stumbled -- sometimes symbolically, sometimes substantially -- in its commitment to include us on the agenda.
Indeed, some gay community members advocated boycotting the White House's Stonewall event. "Co-optation by Cocktails," read one blog post. "Traitors," blathered another. While my heart wasn't filled with such animus, just disappointment, I could understand their anger.
When I told my 17-year-old son Javier about the reception, he could sense that I was torn. From across the dinner table, he looked straight at me: "Papi, you need to go to the White House, and you need to take me. It's the President." Not persuaded by that one, kid. "It's the President, and he needs to see our family, too. To remind him that we're counting on him."
What's true for President Obama is also true for those Americans who still struggle with stereotypes and misperceptions about gay and transgender people. We know that interpersonal connections -- getting to know gay people, their lives, their struggles and concerns -- are one of the most important ways for everyday Americans to understand that we are in every family, in every workplace, on every street. And that we're counting on them to value our contributions, too, and to support our equal treatment.
It's why, even in a place like my home state of Massachusetts -- where I was able to marry my husband in 2004 -- these conversations are still necessary. Even in Massachusetts, where a gay family like ours is virtually equal under state law (though not under federal law), we see our two sons growing up around stereotyped images, abusive language and unfortunate abhorrence of people like their two dads. Legal advances help, but full equality requires us to move our culture through each personal Stonewall -- though conversations, through storytelling, and through media representations that move us toward ever greater regard for the dignity and value of all people.
"Stonewall" has come to mean many things to many people. For me, it commemorates the moment in time when my powder blue Homecoming tux got soiled with the Coca-Cola that Brad the Surfer poured on me in front of the cheerleaders, just before hurling an f-lettered epithet at me in front of half the school. It wasn't the first time I'd been called that hurtful name, but for the first time I answered back: "Yes, I am, Brad -- and so what?" Instead of feeling afraid, I felt wonderful. Elated. I was sitting on top of the world. My own personal Stonewall.
But, as my son made me realize, commemorating the Stonewall Riots isn't about, or just about, our own liberation. It is a call to action for each of us to change the world by telling our stories. Speaking up so that Stonewall can become no longer a part of our present, but truly a part of our history.
The writer is the incoming president of the Gay & Lesbian Alliance Against Defamation (GLAAD) and a former Massachusetts state senator.
For more Post opinions on the Stonewall anniversary, Michael Hamill Remaley's Stonewall Baby, All Grown Up and our interview with former soldier Anthony Woods.
By Jarrett Barrios
Copyright by The Washington Post
Monday, June 29, 2009; 12:00 AM
http://www.washingtonpost.com/wp-dyn/content/article/2009/06/28/AR2009062802336.html
The Stonewall Riots of 1969 -- when patrons at a New York city gay bar fought back against police brutality and harassment and set in motion a wave of activism -- have been commemorated in various ways. There have been protests, rallies, academic lectures and parties. Today is the first time Stonewall will be remembered in the tony quarters of the White House.
I have to admit I was ambivalent when I received the invitation, with its fancy curlicue script (truly, just like my sister's wedding announcement) and a return address that read simply "The White House." The problem is that I haven't been as excited as I'd like to be about President Obama. I'd been excited by Candidate Obama. His campaign invited people like me and my husband Doug -- gay, lesbian, bisexual and transgender Americans -- into his aspirational vision of America the Possible. But, as President Obama, he has presided over an administration that has stumbled -- sometimes symbolically, sometimes substantially -- in its commitment to include us on the agenda.
Indeed, some gay community members advocated boycotting the White House's Stonewall event. "Co-optation by Cocktails," read one blog post. "Traitors," blathered another. While my heart wasn't filled with such animus, just disappointment, I could understand their anger.
When I told my 17-year-old son Javier about the reception, he could sense that I was torn. From across the dinner table, he looked straight at me: "Papi, you need to go to the White House, and you need to take me. It's the President." Not persuaded by that one, kid. "It's the President, and he needs to see our family, too. To remind him that we're counting on him."
What's true for President Obama is also true for those Americans who still struggle with stereotypes and misperceptions about gay and transgender people. We know that interpersonal connections -- getting to know gay people, their lives, their struggles and concerns -- are one of the most important ways for everyday Americans to understand that we are in every family, in every workplace, on every street. And that we're counting on them to value our contributions, too, and to support our equal treatment.
It's why, even in a place like my home state of Massachusetts -- where I was able to marry my husband in 2004 -- these conversations are still necessary. Even in Massachusetts, where a gay family like ours is virtually equal under state law (though not under federal law), we see our two sons growing up around stereotyped images, abusive language and unfortunate abhorrence of people like their two dads. Legal advances help, but full equality requires us to move our culture through each personal Stonewall -- though conversations, through storytelling, and through media representations that move us toward ever greater regard for the dignity and value of all people.
"Stonewall" has come to mean many things to many people. For me, it commemorates the moment in time when my powder blue Homecoming tux got soiled with the Coca-Cola that Brad the Surfer poured on me in front of the cheerleaders, just before hurling an f-lettered epithet at me in front of half the school. It wasn't the first time I'd been called that hurtful name, but for the first time I answered back: "Yes, I am, Brad -- and so what?" Instead of feeling afraid, I felt wonderful. Elated. I was sitting on top of the world. My own personal Stonewall.
But, as my son made me realize, commemorating the Stonewall Riots isn't about, or just about, our own liberation. It is a call to action for each of us to change the world by telling our stories. Speaking up so that Stonewall can become no longer a part of our present, but truly a part of our history.
The writer is the incoming president of the Gay & Lesbian Alliance Against Defamation (GLAAD) and a former Massachusetts state senator.
For more Post opinions on the Stonewall anniversary, Michael Hamill Remaley's Stonewall Baby, All Grown Up and our interview with former soldier Anthony Woods.
Court Rules for White Firefighters Over Promotions
Court Rules for White Firefighters Over Promotions
Copyright By THE ASSOCIATED PRESS
Published: June 29, 2009
http://www.nytimes.com/aponline/2009/06/29/us/politics/AP-US-Supreme-Court-Firefighters-Lawsuit.html?ref=global-home
WASHINGTON (AP) -- The Supreme Court ruled Monday that white firefighters in New Haven, Conn., were unfairly denied promotions because of their race, reversing a decision that high court nominee Sonia Sotomayor endorsed as an appeals court judge.
New Haven was wrong to scrap a promotion exam because no African-Americans and only two Hispanic firefighters were likely to be made lieutenants or captains based on the results, the court said Monday in a 5-4 decision. The city said that it had acted to avoid a lawsuit from minorities.
The ruling could alter employment practices nationwide and make it harder to prove discrimination when there is no evidence it was intentional.
''Fear of litigation alone cannot justify an employer's reliance on race to the detriment of individuals who passed the examinations and qualified for promotions,'' Justice Anthony Kennedy said in his opinion for the court. He was joined by Chief Justice John Roberts and Justices Samuel Alito, Antonin Scalia and Clarence Thomas.
In dissent, Justice Ruth Bader Ginsburg said the white firefighters ''understandably attract this court's sympathy. But they had no vested right to promotion. Nor have other persons received promotions in preference to them.''
Justices Stephen Breyer, David Souter and John Paul Stevens signed onto Ginsburg's dissent, which she read aloud in court Monday.
Kennedy's opinion made only passing reference to the work of Sotomayor and the other two judges on the 2nd U.S. Circuit Court of Appeals who upheld a lower court ruling in favor of New Haven.
But the appellate judges have been criticized for producing a cursory opinion that failed to deal with ''indisputably complex and far from well-settled'' questions, in the words of another appeals court judge, Sotomayor mentor Jose Cabranes.
''This perfunctory disposition rests uneasily with the weighty issues presented by this appeal,'' Cabranes said, in a dissent from the full 2nd Circuit's decision not to hear the case.
Sen. Patrick Leahy, chairman of the Judiciary Committee, said Sotomayor should not be criticized for the unsigned appeals court decision, which he asserted she did not write. ''Judge Sotomayor and the lower court panel did what judges are supposed to do, they followed precedent,'' said the Vermont Democrat who will preside over Sotomayor's confirmation hearings next month.
Leahy also called the high court decision ''cramped'' and wrong.
In New Haven, Nancy Ricci, whose son, Frank, was the lead plaintiff on the lawsuit, carried a large cake decorated with red, white and blue frosting into the law office where the firefighters were celebrating their victory.
Ricci's father, Jim Ricci said the ruling is a victory for firefighters across the country. ''Now we're going to get the best managers as far as firefighters go. That's really important,'' Ricci said.
Monday's decision has its origins in New Haven's need to fill vacancies for lieutenants and captains in its fire department. It hired an outside firm to design a test, which was given to 77 candidates for lieutenant and 41 candidates for captain.
Fifty six firefighters passed the exams, including 41 whites, 22 blacks and 18 Hispanics. But of those, only 17 whites and two Hispanics could expect promotion.
The city eventually decided not to use the exam to determine promotions. It said it acted because it might have been vulnerable to claims that the exam had a ''disparate impact'' on minorities in violation of the Civil Rights Act of 1964.
The white firefighters said the decision violated the same law's prohibition on intentional discrimination.
Kennedy said an employer needs a ''strong basis in evidence'' to believe it will be held liable in a disparate impact lawsuit. New Haven had no such evidence, he said.
The city declined to validate the test after it was given, a step that could have identified flaws or determined that there were no serious problems with it. In addition, city officials could not say what was wrong with the test, other than the racially skewed results.
''The city could be liable for disparate-impact discrimination only if the examinations were not job related'' or the city failed to use a less discriminatory alternative, Kennedy said. ''We conclude that there is no strong basis in evidence to establish that the test was deficient in either of these respects.''
But Ginsburg said the court should have assessed ''the starkly disparate results'' of the exams against the backdrop of historical and ongoing inequality in the New Haven fire department. As of 2003, she said, only one of the city's 21 fire captains was African-American.
Until this decision, Ginsburg said, the civil rights law's prohibitions on intentional discrimination and disparate impact were complementary, both aimed at ending workplace discrimination.
''Today's decision sets these paired directives at odds,'' she said.
Associated Press writer Katie Nelson in New Haven, Conn., contributed to this report.
Copyright By THE ASSOCIATED PRESS
Published: June 29, 2009
http://www.nytimes.com/aponline/2009/06/29/us/politics/AP-US-Supreme-Court-Firefighters-Lawsuit.html?ref=global-home
WASHINGTON (AP) -- The Supreme Court ruled Monday that white firefighters in New Haven, Conn., were unfairly denied promotions because of their race, reversing a decision that high court nominee Sonia Sotomayor endorsed as an appeals court judge.
New Haven was wrong to scrap a promotion exam because no African-Americans and only two Hispanic firefighters were likely to be made lieutenants or captains based on the results, the court said Monday in a 5-4 decision. The city said that it had acted to avoid a lawsuit from minorities.
The ruling could alter employment practices nationwide and make it harder to prove discrimination when there is no evidence it was intentional.
''Fear of litigation alone cannot justify an employer's reliance on race to the detriment of individuals who passed the examinations and qualified for promotions,'' Justice Anthony Kennedy said in his opinion for the court. He was joined by Chief Justice John Roberts and Justices Samuel Alito, Antonin Scalia and Clarence Thomas.
In dissent, Justice Ruth Bader Ginsburg said the white firefighters ''understandably attract this court's sympathy. But they had no vested right to promotion. Nor have other persons received promotions in preference to them.''
Justices Stephen Breyer, David Souter and John Paul Stevens signed onto Ginsburg's dissent, which she read aloud in court Monday.
Kennedy's opinion made only passing reference to the work of Sotomayor and the other two judges on the 2nd U.S. Circuit Court of Appeals who upheld a lower court ruling in favor of New Haven.
But the appellate judges have been criticized for producing a cursory opinion that failed to deal with ''indisputably complex and far from well-settled'' questions, in the words of another appeals court judge, Sotomayor mentor Jose Cabranes.
''This perfunctory disposition rests uneasily with the weighty issues presented by this appeal,'' Cabranes said, in a dissent from the full 2nd Circuit's decision not to hear the case.
Sen. Patrick Leahy, chairman of the Judiciary Committee, said Sotomayor should not be criticized for the unsigned appeals court decision, which he asserted she did not write. ''Judge Sotomayor and the lower court panel did what judges are supposed to do, they followed precedent,'' said the Vermont Democrat who will preside over Sotomayor's confirmation hearings next month.
Leahy also called the high court decision ''cramped'' and wrong.
In New Haven, Nancy Ricci, whose son, Frank, was the lead plaintiff on the lawsuit, carried a large cake decorated with red, white and blue frosting into the law office where the firefighters were celebrating their victory.
Ricci's father, Jim Ricci said the ruling is a victory for firefighters across the country. ''Now we're going to get the best managers as far as firefighters go. That's really important,'' Ricci said.
Monday's decision has its origins in New Haven's need to fill vacancies for lieutenants and captains in its fire department. It hired an outside firm to design a test, which was given to 77 candidates for lieutenant and 41 candidates for captain.
Fifty six firefighters passed the exams, including 41 whites, 22 blacks and 18 Hispanics. But of those, only 17 whites and two Hispanics could expect promotion.
The city eventually decided not to use the exam to determine promotions. It said it acted because it might have been vulnerable to claims that the exam had a ''disparate impact'' on minorities in violation of the Civil Rights Act of 1964.
The white firefighters said the decision violated the same law's prohibition on intentional discrimination.
Kennedy said an employer needs a ''strong basis in evidence'' to believe it will be held liable in a disparate impact lawsuit. New Haven had no such evidence, he said.
The city declined to validate the test after it was given, a step that could have identified flaws or determined that there were no serious problems with it. In addition, city officials could not say what was wrong with the test, other than the racially skewed results.
''The city could be liable for disparate-impact discrimination only if the examinations were not job related'' or the city failed to use a less discriminatory alternative, Kennedy said. ''We conclude that there is no strong basis in evidence to establish that the test was deficient in either of these respects.''
But Ginsburg said the court should have assessed ''the starkly disparate results'' of the exams against the backdrop of historical and ongoing inequality in the New Haven fire department. As of 2003, she said, only one of the city's 21 fire captains was African-American.
Until this decision, Ginsburg said, the civil rights law's prohibitions on intentional discrimination and disparate impact were complementary, both aimed at ending workplace discrimination.
''Today's decision sets these paired directives at odds,'' she said.
Associated Press writer Katie Nelson in New Haven, Conn., contributed to this report.
Argentina’s Ruling Party Concedes Electoral Defeat
Argentina’s Ruling Party Concedes Electoral Defeat
By ALEXEI BARRIONUEVO
Copyright by The New York Times
Published: June 29, 2009
http://www.nytimes.com/2009/06/30/world/americas/30argentina.html?ref=global-home
BUENOS AIRES — Néstor Kirchner, the former president and head of the governing Peronist Party, conceded defeat early Monday in critical congressional elections that became a referendum on his leadership and that of his wife, the current president, Cristina Fernández de Kirchner.
Just after 2 a.m., a weary Mr. Kirchner told supporters, “We have lost and we don’t have any problem recognizing our opponents’ victory,” as results indicated the party had lost control of both houses of Congress.
With 74 percent of votes counted in the key Buenos Aires Province elections, Mr. Kirchner’s Front for Victory coalition had 32.1 percent of the vote, trailing the Union-PRO party led by Francisco de Narváez, a congressman and businessman, with 34.5 percent.
Mr. Kirchner, who as president guided the country out of its devastating economic crisis of 2001, ran for the lower house of Congress as part of an effort to save the Peronists from a humiliating defeat in Sunday’s elections. Without a first-place finish, the chances that the couple will continue their political dynasty in the 2011 presidential elections will dim badly, political and investment-risk analysts said.
“If Kirchner loses in Buenos Aires, that would require a lot of rethinking about how they are going to manage to stay in control,” said Federico Thomsen, an economist and political analyst in Buenos Aires.
There has been widespread speculation that Mrs. Kirchner could resign or call early elections if her husband lost in Buenos Aires. But that decision could be tough to swallow for the president because it would mean ceding power to Julio Cobos, the vice president who defied her by siding with farmers in a key Senate vote last year.
Analysts had expected the Kirchners to lose control of both houses of Congress, complicating their ability to continue their socialist policies, which have included providing heavy subsidies for food and fuel, and the recent nationalizations of Argentina’s largest airline and of private pension funds.
With Mrs. Kirchner’s popularity dipping badly in rural provinces, where she has waged a protracted battle with farmers over agricultural tax policies, Mr. Kirchner decided to run for the lower house of Congress in Buenos Aires Province, which represents 37 percent of the country’s total voters.
Mrs. Kirchner pushed Congress to move up the congressional elections by four months to June, a move that she said would avoid complicating voters’ lives later in the year, when she expected the global financial crisis to hit Argentina badly. Analysts said it appeared to have been an attempt to catch the opposition off guard.
The Peronists realized that even Mr. Kirchner’s presence on the ticket would not be enough to guarantee a victory in Buenos Aires Province. So party leaders obligated dozens of city councilmen, as well as the governor of Buenos Aires, Daniel Scioli, to run on the ticket with Mr. Kirchner. Mr. Scioli and others are viewed to be “testimonial candidates” who will not actually end up assuming the jobs to which they would be elected and would instead remain in their current posts, a controversial practice here that has not been challenged.
The use of testimonial candidates, along with Mr. Kirchner’s decision to run himself, were “signs of the weakness” of Mrs. Kirchner, who has struggled to garner more than 30 percent support in opinion polls, said Graciela Römer, a political analyst here.
“It is well-established now that the Kirchner era is ending,” Ms. Römer said.
In another critical race, Carlos Reutemann, a former governor of Santa Fe Province, was neck-in-neck with candidates supported by Hermes Binner, the current governor of Santa Fe. With 74 percent of the votes counted, Mr. Reutemann had 39.84 percent compared to 39.85 for Mr. Binner’s candidates.
Mr. Reutemann, who split from the Kirchners, is still among the more popular Peronists and was thought to be the next-best hope for the Peronists to hold onto the presidency in the 2011 election.
Candidates supported by the Kirchners were also losing in Mr. Kirchner’s home state of Santa Cruz. With 71 percent of votes counted, they were trailing with 41.2 percent of the vote, compared to 42.5 percent for their opponents.
Vinod Sreeharsha contributed reporting.
By ALEXEI BARRIONUEVO
Copyright by The New York Times
Published: June 29, 2009
http://www.nytimes.com/2009/06/30/world/americas/30argentina.html?ref=global-home
BUENOS AIRES — Néstor Kirchner, the former president and head of the governing Peronist Party, conceded defeat early Monday in critical congressional elections that became a referendum on his leadership and that of his wife, the current president, Cristina Fernández de Kirchner.
Just after 2 a.m., a weary Mr. Kirchner told supporters, “We have lost and we don’t have any problem recognizing our opponents’ victory,” as results indicated the party had lost control of both houses of Congress.
With 74 percent of votes counted in the key Buenos Aires Province elections, Mr. Kirchner’s Front for Victory coalition had 32.1 percent of the vote, trailing the Union-PRO party led by Francisco de Narváez, a congressman and businessman, with 34.5 percent.
Mr. Kirchner, who as president guided the country out of its devastating economic crisis of 2001, ran for the lower house of Congress as part of an effort to save the Peronists from a humiliating defeat in Sunday’s elections. Without a first-place finish, the chances that the couple will continue their political dynasty in the 2011 presidential elections will dim badly, political and investment-risk analysts said.
“If Kirchner loses in Buenos Aires, that would require a lot of rethinking about how they are going to manage to stay in control,” said Federico Thomsen, an economist and political analyst in Buenos Aires.
There has been widespread speculation that Mrs. Kirchner could resign or call early elections if her husband lost in Buenos Aires. But that decision could be tough to swallow for the president because it would mean ceding power to Julio Cobos, the vice president who defied her by siding with farmers in a key Senate vote last year.
Analysts had expected the Kirchners to lose control of both houses of Congress, complicating their ability to continue their socialist policies, which have included providing heavy subsidies for food and fuel, and the recent nationalizations of Argentina’s largest airline and of private pension funds.
With Mrs. Kirchner’s popularity dipping badly in rural provinces, where she has waged a protracted battle with farmers over agricultural tax policies, Mr. Kirchner decided to run for the lower house of Congress in Buenos Aires Province, which represents 37 percent of the country’s total voters.
Mrs. Kirchner pushed Congress to move up the congressional elections by four months to June, a move that she said would avoid complicating voters’ lives later in the year, when she expected the global financial crisis to hit Argentina badly. Analysts said it appeared to have been an attempt to catch the opposition off guard.
The Peronists realized that even Mr. Kirchner’s presence on the ticket would not be enough to guarantee a victory in Buenos Aires Province. So party leaders obligated dozens of city councilmen, as well as the governor of Buenos Aires, Daniel Scioli, to run on the ticket with Mr. Kirchner. Mr. Scioli and others are viewed to be “testimonial candidates” who will not actually end up assuming the jobs to which they would be elected and would instead remain in their current posts, a controversial practice here that has not been challenged.
The use of testimonial candidates, along with Mr. Kirchner’s decision to run himself, were “signs of the weakness” of Mrs. Kirchner, who has struggled to garner more than 30 percent support in opinion polls, said Graciela Römer, a political analyst here.
“It is well-established now that the Kirchner era is ending,” Ms. Römer said.
In another critical race, Carlos Reutemann, a former governor of Santa Fe Province, was neck-in-neck with candidates supported by Hermes Binner, the current governor of Santa Fe. With 74 percent of the votes counted, Mr. Reutemann had 39.84 percent compared to 39.85 for Mr. Binner’s candidates.
Mr. Reutemann, who split from the Kirchners, is still among the more popular Peronists and was thought to be the next-best hope for the Peronists to hold onto the presidency in the 2011 election.
Candidates supported by the Kirchners were also losing in Mr. Kirchner’s home state of Santa Cruz. With 71 percent of votes counted, they were trailing with 41.2 percent of the vote, compared to 42.5 percent for their opponents.
Vinod Sreeharsha contributed reporting.
Honduran President Is Ousted in Coup
Honduran President Is Ousted in Coup
By ELISABETH MALKIN
Copyright by The Associated Press
Published: June 28, 2009
http://www.nytimes.com/2009/06/29/world/americas/29honduras.html?ref=global-home
MEXICO CITY — President Manuel Zelaya of Honduras was ousted by the army on Sunday, capping months of tensions over his efforts to lift presidential term limits.
In the first military coup in Central America since the end of the cold war, soldiers stormed the presidential palace in the capital, Tegucigalpa, early in the morning, disarming the presidential guard, waking Mr. Zelaya and putting him on a plane to Costa Rica.
Mr. Zelaya, a leftist aligned with President Hugo Chávez of Venezuela, angrily denounced the coup as illegal. “I am the president of Honduras,” he insisted at the airport in San José, Costa Rica, still wearing his pajamas.
Later Sunday the Honduran Congress voted him out of office, replacing him with the president of Congress, Roberto Micheletti.
The military offered no public explanation for its actions, but the Supreme Court issued a statement saying that the military had acted to defend the law against “those who had publicly spoken out and acted against the Constitution’s provisions.”
Leaders across the hemisphere, however, denounced the coup, which American officials on Sunday said they had been working for several days to avert.
President Obama said he was deeply concerned and in a statement called on Honduran officials “to respect democratic norms, the rule of law and the tenets of the Inter-American Democratic charter.
“Any existing tensions and disputes must be resolved peacefully through dialogue free from any outside interference,” he said. His quick condemnation offered a sharp contrast with the actions of the Bush administration, which in 2002 offered a rapid, tacit endorsement of a short-lived coup against Mr. Chávez.
The Organization of American States issued a statement calling for Mr. Zelaya’s return and said it would not recognize any other government. The organization’s secretary general, José Miguel Insulza, called an emergency meeting of the group to weigh further actions.
The arrest of Mr. Zelaya was the culmination of a battle that had been simmering for weeks over a referendum, which was to have taken place Sunday, that he hoped would lead to a revision of the Constitution. Critics said it was part of an illegal attempt by Mr. Zelaya to defy the Constitution’s limit of a single four-year term for the president.
Early this month, the Supreme Court agreed, declaring the referendum unconstitutional, and Congress followed suit last week. In the last few weeks, supporters and opponents of the president have held competing demonstrations. On Thursday, Mr. Zelaya led a group of protesters to an Air Force base and seized the ballots, which the prosecutor’s office and the electoral tribunal had ordered confiscated.
When the army refused to help organize the vote, he fired the armed forces commander, Gen. Romeo Vásquez. The Supreme Court ruled the firing illegal and reinstated General Vásquez.
As the crisis escalated, American officials began in the last few days to talk with Honduran government and military officials in an effort to head off a possible coup. A senior administration official, who briefed reporters on the condition of anonymity, said the military broke off those discussions on Sunday.
The two nations have long had a close military relationship, with an American military task force stationed at a Honduran air base about 50 miles northwest of Tegucigalpa. The unit focuses on training Honduran military forces, counternarcotics operations, search and rescue, and disaster relief missions throughout Central America.
In Costa Rica, Mr. Zelaya told the Venezuelan channel Telesur that he had been awoken by gunshots. Masked soldiers took his cellphone, shoved him into a van and took him to an air force base, where he was put on a plane. He said he did not know that he was being taken to Costa Rica until he landed at the airport in San José.
“They are creating a monster they will not be able to contain,” he told a local television station in San José. “A usurper government, that emerges by force, cannot be accepted, will not be accepted by any country.”
Electricity was cut off for much of the day in Tegucigalpa on Sunday, in what local reports suggested was on military orders. Tanks patrolled the streets and military planes flew overhead. Soldiers guarded the main government buildings, residents said.
A nationwide curfew was imposed overnight starting at 9 p.m.
At the Salvadoran border, an immigration official allowed passage into Honduras Sunday night with a warning: “Be careful. We don’t know what’s going on in there.”
The military also appeared to be moving against Mr. Zelaya’s allies. Local media reported that Foreign Minister Patricia Rodas and the mayor of San Pedro Sula, the country’s second largest city, had been detained at military bases.
Church services were canceled and most people stayed home. Several thousand protesters supporting the president faced off against soldiers outside the presidential palace, burning tires.
The government television station and a television station that supports the president were taken off the air. Television and radio stations broadcast no news. Only wealthy Hondurans with access to the Internet and cable television were able to follow the day’s events.
The Congress met in an emergency session on Sunday afternoon and voted to accept what was said to be a letter of resignation from the president. Mr. Zelaya, whose term officially ends in January, later assured reporters that he had written no such letter.
Obama administration officials said they were working with other members of the Organization of American States to ratchet up pressure on the Honduran military to end the coup and dismissed the prospect of outside military intervention in the matter.
“We think this can be resolved through dialogue,” said the senior administration official. However, he admitted that the Honduran military was not responding to calls from the American government.
The officials also dismissed allegations by Mr. Chávez that the coup had been orchestrated by the United States. They said that the Obama administration considered Mr. Zelaya the constitutional leader of Honduras and that Washington had been consistent in its demands for a peaceful resolution to the brewing crisis.
Honduras has had a civilian government since 1982. But as in much of Central America, the military is still a powerful force behind the scenes. The last coup in the region occurred in Guatemala in 1983, when the military overthrew the government headed by Gen. Efraín Ríos Montt.
Mr. Zelaya, 56, a rancher who often appears in cowboy boots and a western hat, has the support of labor unions and the poor. But the middle class and the wealthy business community fear he wants to introduce Mr. Chávez’s brand of socialist populism into the country, one of Latin America’s poorest.
Marc Lacey contributed reporting from El Amatillo, Honduras, and Mark Mazzetti from Washington.
By ELISABETH MALKIN
Copyright by The Associated Press
Published: June 28, 2009
http://www.nytimes.com/2009/06/29/world/americas/29honduras.html?ref=global-home
MEXICO CITY — President Manuel Zelaya of Honduras was ousted by the army on Sunday, capping months of tensions over his efforts to lift presidential term limits.
In the first military coup in Central America since the end of the cold war, soldiers stormed the presidential palace in the capital, Tegucigalpa, early in the morning, disarming the presidential guard, waking Mr. Zelaya and putting him on a plane to Costa Rica.
Mr. Zelaya, a leftist aligned with President Hugo Chávez of Venezuela, angrily denounced the coup as illegal. “I am the president of Honduras,” he insisted at the airport in San José, Costa Rica, still wearing his pajamas.
Later Sunday the Honduran Congress voted him out of office, replacing him with the president of Congress, Roberto Micheletti.
The military offered no public explanation for its actions, but the Supreme Court issued a statement saying that the military had acted to defend the law against “those who had publicly spoken out and acted against the Constitution’s provisions.”
Leaders across the hemisphere, however, denounced the coup, which American officials on Sunday said they had been working for several days to avert.
President Obama said he was deeply concerned and in a statement called on Honduran officials “to respect democratic norms, the rule of law and the tenets of the Inter-American Democratic charter.
“Any existing tensions and disputes must be resolved peacefully through dialogue free from any outside interference,” he said. His quick condemnation offered a sharp contrast with the actions of the Bush administration, which in 2002 offered a rapid, tacit endorsement of a short-lived coup against Mr. Chávez.
The Organization of American States issued a statement calling for Mr. Zelaya’s return and said it would not recognize any other government. The organization’s secretary general, José Miguel Insulza, called an emergency meeting of the group to weigh further actions.
The arrest of Mr. Zelaya was the culmination of a battle that had been simmering for weeks over a referendum, which was to have taken place Sunday, that he hoped would lead to a revision of the Constitution. Critics said it was part of an illegal attempt by Mr. Zelaya to defy the Constitution’s limit of a single four-year term for the president.
Early this month, the Supreme Court agreed, declaring the referendum unconstitutional, and Congress followed suit last week. In the last few weeks, supporters and opponents of the president have held competing demonstrations. On Thursday, Mr. Zelaya led a group of protesters to an Air Force base and seized the ballots, which the prosecutor’s office and the electoral tribunal had ordered confiscated.
When the army refused to help organize the vote, he fired the armed forces commander, Gen. Romeo Vásquez. The Supreme Court ruled the firing illegal and reinstated General Vásquez.
As the crisis escalated, American officials began in the last few days to talk with Honduran government and military officials in an effort to head off a possible coup. A senior administration official, who briefed reporters on the condition of anonymity, said the military broke off those discussions on Sunday.
The two nations have long had a close military relationship, with an American military task force stationed at a Honduran air base about 50 miles northwest of Tegucigalpa. The unit focuses on training Honduran military forces, counternarcotics operations, search and rescue, and disaster relief missions throughout Central America.
In Costa Rica, Mr. Zelaya told the Venezuelan channel Telesur that he had been awoken by gunshots. Masked soldiers took his cellphone, shoved him into a van and took him to an air force base, where he was put on a plane. He said he did not know that he was being taken to Costa Rica until he landed at the airport in San José.
“They are creating a monster they will not be able to contain,” he told a local television station in San José. “A usurper government, that emerges by force, cannot be accepted, will not be accepted by any country.”
Electricity was cut off for much of the day in Tegucigalpa on Sunday, in what local reports suggested was on military orders. Tanks patrolled the streets and military planes flew overhead. Soldiers guarded the main government buildings, residents said.
A nationwide curfew was imposed overnight starting at 9 p.m.
At the Salvadoran border, an immigration official allowed passage into Honduras Sunday night with a warning: “Be careful. We don’t know what’s going on in there.”
The military also appeared to be moving against Mr. Zelaya’s allies. Local media reported that Foreign Minister Patricia Rodas and the mayor of San Pedro Sula, the country’s second largest city, had been detained at military bases.
Church services were canceled and most people stayed home. Several thousand protesters supporting the president faced off against soldiers outside the presidential palace, burning tires.
The government television station and a television station that supports the president were taken off the air. Television and radio stations broadcast no news. Only wealthy Hondurans with access to the Internet and cable television were able to follow the day’s events.
The Congress met in an emergency session on Sunday afternoon and voted to accept what was said to be a letter of resignation from the president. Mr. Zelaya, whose term officially ends in January, later assured reporters that he had written no such letter.
Obama administration officials said they were working with other members of the Organization of American States to ratchet up pressure on the Honduran military to end the coup and dismissed the prospect of outside military intervention in the matter.
“We think this can be resolved through dialogue,” said the senior administration official. However, he admitted that the Honduran military was not responding to calls from the American government.
The officials also dismissed allegations by Mr. Chávez that the coup had been orchestrated by the United States. They said that the Obama administration considered Mr. Zelaya the constitutional leader of Honduras and that Washington had been consistent in its demands for a peaceful resolution to the brewing crisis.
Honduras has had a civilian government since 1982. But as in much of Central America, the military is still a powerful force behind the scenes. The last coup in the region occurred in Guatemala in 1983, when the military overthrew the government headed by Gen. Efraín Ríos Montt.
Mr. Zelaya, 56, a rancher who often appears in cowboy boots and a western hat, has the support of labor unions and the poor. But the middle class and the wealthy business community fear he wants to introduce Mr. Chávez’s brand of socialist populism into the country, one of Latin America’s poorest.
Marc Lacey contributed reporting from El Amatillo, Honduras, and Mark Mazzetti from Washington.
Gay Marriage Lost in Shuffle of Divided Senate
Gay Marriage Lost in Shuffle of Divided Senate
By JEREMY W. PETERS
Copyright by The New York Times
Published: June 28, 2009
http://www.nytimes.com/2009/06/29/nyregion/29pride.html?th&emc=th
When Gov. David A. Paterson accepted an invitation to be a grand marshal in New York City’s gay pride parade this year, he had high expectations that he would march down Fifth Avenue as the first governor in state history to have signed a law allowing gay couples to marry.
Gov. David A. Paterson, right, with the City Council speaker, Christine C. Quinn, and Senator Thomas K. Duane. More Photos »
But the hopes of Mr. Paterson and gay rights advocates who have been pushing for same-sex marriage have collided with a political maelstrom in Albany. Like every other major public-policy issue before the State Legislature — from local sales taxes to control of New York City’s school system — same-sex marriage is on hold until Republicans and Democrats in the State Senate reach a compromise over who will control the chamber.
So on Sunday afternoon, as the governor clutched a rainbow flag in his left hand and waved to the legions of gay men and lesbians who turned out for the parade, his presence was more of an anticlimax than a climax.
“In my dream, I was grand marshal of a parade where as I’m taking steps down Fifth Avenue, many New Yorkers can take steps down the aisles to be married, which I think is their right,” Mr. Paterson said as he was beginning the 40-plus-block walk from Midtown to Greenwich Village. He noted that he was the first governor to serve as grand marshal.
Mr. Paterson said on Sunday that while he hoped the Senate would move quickly to pass a same-sex marriage bill, he remained wary of introducing the issue into such a fractious political environment.
“I think that the bill should be considered,” he said, adding, “I have tried not to insert into an already acrimonious situation any controversial legislation that might exacerbate the tension and cause the bill to lose.”
It remains unknowable what will become of the bill, which passed the State Assembly in May by a margin of 89 to 52. After Mr. Paterson initially omitted the bill from the agenda of the first extraordinary session of the Senate that he convened last week, he drew a sharp outcry from advocates of gay rights. The governor then included it among the bills he asked the Senate to consider later in the week.
But the Senate has ignored Mr. Paterson’s calls to take up any legislation, and has done all that the State Constitution essentially compels senators to do when the governor convenes an extraordinary session: show up in the Senate chamber.
On Sunday, both sides of the divided Senate returned for brief sessions, one side after the other gaveling in and out without taking up any business. Senators on each side said they had not even agreed whether to meet later that night.
“It’s almost as if they want to stall,” said Senator Tom Libous, a Republican of Binghamton.
Democrats have been pushing for a temporary agreement that will allow critical bills to pass; Republicans insist on a power-sharing deal that extends through 2010.
“We want to get the business of the people done,” said Senator John L. Sampson, the leader of the Democrats.
The question that supporters of same-sex marriage are trying to resolve now is whether the bill would be on the agenda of any session the Senate convenes, once it settles its leadership fight. But no one can be sure when the dispute will be resolved or what legislation will be considered once the Senate begins functioning again.
“We need the Senate to get back to work,” said the New York City Council speaker, Christine C. Quinn, who appeared at the parade with her longtime partner, Kim Catullo. “We need a vote on marriage equality. We need the New York State Senate to have the courage of its convictions and to stand up and say what they think.”
Some spectators at the parade on Sunday were not holding their breath. Kevin Silas, 40, of Poughkeepsie, N.Y., who was with his partner, Charles Kelley, 47, said he did not have much faith that the impasse in Albany would be settled and that same-sex marriage would be one of the issues the Senate addresses soon.
“I mean, I’m going to love him regardless,” Mr. Silas said, gesturing toward Mr. Kelley, his partner of eight years. The two were married in New Paltz, N.Y., during the brief period in 2004 when the mayor there was performing unofficial same-sex marriages. “I’ve already got the ring.”
Danny Hakim and Mathew R. Warren contributed reporting.
By JEREMY W. PETERS
Copyright by The New York Times
Published: June 28, 2009
http://www.nytimes.com/2009/06/29/nyregion/29pride.html?th&emc=th
When Gov. David A. Paterson accepted an invitation to be a grand marshal in New York City’s gay pride parade this year, he had high expectations that he would march down Fifth Avenue as the first governor in state history to have signed a law allowing gay couples to marry.
Gov. David A. Paterson, right, with the City Council speaker, Christine C. Quinn, and Senator Thomas K. Duane. More Photos »
But the hopes of Mr. Paterson and gay rights advocates who have been pushing for same-sex marriage have collided with a political maelstrom in Albany. Like every other major public-policy issue before the State Legislature — from local sales taxes to control of New York City’s school system — same-sex marriage is on hold until Republicans and Democrats in the State Senate reach a compromise over who will control the chamber.
So on Sunday afternoon, as the governor clutched a rainbow flag in his left hand and waved to the legions of gay men and lesbians who turned out for the parade, his presence was more of an anticlimax than a climax.
“In my dream, I was grand marshal of a parade where as I’m taking steps down Fifth Avenue, many New Yorkers can take steps down the aisles to be married, which I think is their right,” Mr. Paterson said as he was beginning the 40-plus-block walk from Midtown to Greenwich Village. He noted that he was the first governor to serve as grand marshal.
Mr. Paterson said on Sunday that while he hoped the Senate would move quickly to pass a same-sex marriage bill, he remained wary of introducing the issue into such a fractious political environment.
“I think that the bill should be considered,” he said, adding, “I have tried not to insert into an already acrimonious situation any controversial legislation that might exacerbate the tension and cause the bill to lose.”
It remains unknowable what will become of the bill, which passed the State Assembly in May by a margin of 89 to 52. After Mr. Paterson initially omitted the bill from the agenda of the first extraordinary session of the Senate that he convened last week, he drew a sharp outcry from advocates of gay rights. The governor then included it among the bills he asked the Senate to consider later in the week.
But the Senate has ignored Mr. Paterson’s calls to take up any legislation, and has done all that the State Constitution essentially compels senators to do when the governor convenes an extraordinary session: show up in the Senate chamber.
On Sunday, both sides of the divided Senate returned for brief sessions, one side after the other gaveling in and out without taking up any business. Senators on each side said they had not even agreed whether to meet later that night.
“It’s almost as if they want to stall,” said Senator Tom Libous, a Republican of Binghamton.
Democrats have been pushing for a temporary agreement that will allow critical bills to pass; Republicans insist on a power-sharing deal that extends through 2010.
“We want to get the business of the people done,” said Senator John L. Sampson, the leader of the Democrats.
The question that supporters of same-sex marriage are trying to resolve now is whether the bill would be on the agenda of any session the Senate convenes, once it settles its leadership fight. But no one can be sure when the dispute will be resolved or what legislation will be considered once the Senate begins functioning again.
“We need the Senate to get back to work,” said the New York City Council speaker, Christine C. Quinn, who appeared at the parade with her longtime partner, Kim Catullo. “We need a vote on marriage equality. We need the New York State Senate to have the courage of its convictions and to stand up and say what they think.”
Some spectators at the parade on Sunday were not holding their breath. Kevin Silas, 40, of Poughkeepsie, N.Y., who was with his partner, Charles Kelley, 47, said he did not have much faith that the impasse in Albany would be settled and that same-sex marriage would be one of the issues the Senate addresses soon.
“I mean, I’m going to love him regardless,” Mr. Silas said, gesturing toward Mr. Kelley, his partner of eight years. The two were married in New Paltz, N.Y., during the brief period in 2004 when the mayor there was performing unofficial same-sex marriages. “I’ve already got the ring.”
Danny Hakim and Mathew R. Warren contributed reporting.
Israel May Shift on Settlements Freeze Amid Broader Effort
Israel May Shift on Settlements Freeze Amid Broader Effort
By ETHAN BRONNER
Copyright by The Associated Press
Published: June 28, 2009
http://www.nytimes.com/2009/06/29/world/middleeast/29mideast.html?_r=1&th&emc=th
JERUSALEM — Israel would be open to a complete freeze of settlement building in the West Bank for three to six months as part of a broad Middle East peace endeavor that included a Palestinian agreement to negotiate an end to the conflict and confidence-building steps by major Arab nations, senior Israeli officials said Sunday.
The officials spoke before a planned meeting in Washington on Tuesday between Israel’s defense minister, Ehud Barak, and George J. Mitchell, the Obama administration’s Middle East envoy, and said this was the message Mr. Barak would take with him.
The freeze would not affect construction that was already under way, nor include East Jerusalem. But it would mean that during the specified time no construction of any kind could start even in the close-in settlement blocks that Israel expects to keep in any future two-state agreement with the Palestinians.
While such an offer falls short of President Obama’s demand that Israel halt all settlement building now, it is the most forthcoming response that senior Israeli officials have given to date and suggests that American pressure is having some effect. Until now, Israeli officials have insisted that settlements cannot be asked to end “natural growth” or “normal life,” meaning building for the children of those living there.
The officials who spoke of the prospect of a temporary freeze said the issue was explosive in Israel, so they were not prepared to have their names publicly associated with the idea at this stage. But they spoke with clear authority. They calculated that about 2,000 buildings were going up in West Bank settlements now and said that they would be completed under their proposal, but nothing new would start. They also said that if broader peace efforts came to naught, the building would start up again.
Mr. Barak himself declined to address the question of a temporary freeze in a conversation on Sunday with The New York Times, saying only that settlements should be viewed as one issue in a larger framework needed to create a Middle East peace.
“For us, it is very important that the Palestinians commit to seeking an end to the conflict and a finality of any claims,” he said. “We should not isolate this issue of settlements and make it the most important one. It has to be discussed in the context of a larger peace discussion.”
He added, “Many Israelis fear that what Palestinians want is not two states but two stages,” meaning an end to Israel in phases. He also said that by focusing solely on settlement building and not on what the Arab countries should also be doing for peace, Israel felt that it was being driven to its knees and delivered to the other side rather than asked to join a shared effort.
Israel, he said, was eager for a regional agreement that would lead to a state for the Palestinians and security for Israel.
The issue of settlement building has plagued regional peace efforts and Israeli-American relations for decades, ever since the 1967 Middle East war ended with Israel holding vast swaths of land that had been won from its neighbors. In particular, taking the West Bank, previously held by Jordan, fired the collective imagination in Israel because so much of it — including the cities of Hebron, Nablus and Jericho — was part of the biblical Jewish homeland that Zionism sought to reclaim.
There are now nearly 300,000 Israeli settlers living in the West Bank in addition to 200,000 Israeli Jews living in East Jerusalem, also taken in that war. Since the Palestinians hope to build their state in the West Bank, Gaza and East Jerusalem, they accuse Israel of making that goal impossible through settlement building.
Israel says the real problem is Arab rejection of its existence in any borders at all and the rise of violent, radical Islam backed by Iran. When it removed soldiers from southern Lebanon in 2000 and soldiers and settlers from Gaza in 2005, it faced rocket fire from Hezbollah and Hamas.
The Obama administration believes that in order to build a solid regional coalition to confront Iranian ambitions, West Bank settlement building needs to stop as a sign of Israeli willingness to accept a Palestinian state.
Such a demand is part of the “road map” agreed to by the United States, Russia, the European Union and the United Nations, the so-called quartet, and signed by Israel. But the Israelis said they had unwritten agreements with the former Bush administration that defined the freeze more narrowly, as not building new settlements or expropriating more land. Last week the quartet issued its own call for a complete settlement freeze.
The issue is so problematic here partly because the three-month-old government of Prime Minister Benjamin Netanyahu is a largely right-wing coalition with parties that support more settlement building. But Mr. Netanyahu recently accepted the idea of two states and has said Israel would work hard on helping the Palestinians improve their lives in the West Bank.
Mr. Barak said on Sunday that Israel was already making progress on that. It has formed a ministerial committee headed by Mr. Netanyahu aimed at starting economic projects in the West Bank. It has also given the Palestinian security forces greater freedom of action in the past couple of weeks.
Mr. Barak presented such steps as examples of concessions Israel had already made that deserved recognition from Washington and Arab leaders. Among the steps being discussed that Arab nations might take as confidence building measures for Israel are permitting Israeli travelers to transit through their airports, allowing Israeli airplanes to fly in their airspace and creating limited academic and tourist exchanges. Among Arab countries, only Egypt and Jordan have full diplomatic relations with Israel.
In the interview, Mr. Barak suggested that there could be a role for an international Middle East peace conference in the coming months at which all sides would agree to steps and concessions. He said that given Washington’s desire to remove its troops from Iraq and find a way to deal with Iran, this was an auspicious moment for bold regional thinking that could make far-reaching changes, and Israel was eager to play its part.
By ETHAN BRONNER
Copyright by The Associated Press
Published: June 28, 2009
http://www.nytimes.com/2009/06/29/world/middleeast/29mideast.html?_r=1&th&emc=th
JERUSALEM — Israel would be open to a complete freeze of settlement building in the West Bank for three to six months as part of a broad Middle East peace endeavor that included a Palestinian agreement to negotiate an end to the conflict and confidence-building steps by major Arab nations, senior Israeli officials said Sunday.
The officials spoke before a planned meeting in Washington on Tuesday between Israel’s defense minister, Ehud Barak, and George J. Mitchell, the Obama administration’s Middle East envoy, and said this was the message Mr. Barak would take with him.
The freeze would not affect construction that was already under way, nor include East Jerusalem. But it would mean that during the specified time no construction of any kind could start even in the close-in settlement blocks that Israel expects to keep in any future two-state agreement with the Palestinians.
While such an offer falls short of President Obama’s demand that Israel halt all settlement building now, it is the most forthcoming response that senior Israeli officials have given to date and suggests that American pressure is having some effect. Until now, Israeli officials have insisted that settlements cannot be asked to end “natural growth” or “normal life,” meaning building for the children of those living there.
The officials who spoke of the prospect of a temporary freeze said the issue was explosive in Israel, so they were not prepared to have their names publicly associated with the idea at this stage. But they spoke with clear authority. They calculated that about 2,000 buildings were going up in West Bank settlements now and said that they would be completed under their proposal, but nothing new would start. They also said that if broader peace efforts came to naught, the building would start up again.
Mr. Barak himself declined to address the question of a temporary freeze in a conversation on Sunday with The New York Times, saying only that settlements should be viewed as one issue in a larger framework needed to create a Middle East peace.
“For us, it is very important that the Palestinians commit to seeking an end to the conflict and a finality of any claims,” he said. “We should not isolate this issue of settlements and make it the most important one. It has to be discussed in the context of a larger peace discussion.”
He added, “Many Israelis fear that what Palestinians want is not two states but two stages,” meaning an end to Israel in phases. He also said that by focusing solely on settlement building and not on what the Arab countries should also be doing for peace, Israel felt that it was being driven to its knees and delivered to the other side rather than asked to join a shared effort.
Israel, he said, was eager for a regional agreement that would lead to a state for the Palestinians and security for Israel.
The issue of settlement building has plagued regional peace efforts and Israeli-American relations for decades, ever since the 1967 Middle East war ended with Israel holding vast swaths of land that had been won from its neighbors. In particular, taking the West Bank, previously held by Jordan, fired the collective imagination in Israel because so much of it — including the cities of Hebron, Nablus and Jericho — was part of the biblical Jewish homeland that Zionism sought to reclaim.
There are now nearly 300,000 Israeli settlers living in the West Bank in addition to 200,000 Israeli Jews living in East Jerusalem, also taken in that war. Since the Palestinians hope to build their state in the West Bank, Gaza and East Jerusalem, they accuse Israel of making that goal impossible through settlement building.
Israel says the real problem is Arab rejection of its existence in any borders at all and the rise of violent, radical Islam backed by Iran. When it removed soldiers from southern Lebanon in 2000 and soldiers and settlers from Gaza in 2005, it faced rocket fire from Hezbollah and Hamas.
The Obama administration believes that in order to build a solid regional coalition to confront Iranian ambitions, West Bank settlement building needs to stop as a sign of Israeli willingness to accept a Palestinian state.
Such a demand is part of the “road map” agreed to by the United States, Russia, the European Union and the United Nations, the so-called quartet, and signed by Israel. But the Israelis said they had unwritten agreements with the former Bush administration that defined the freeze more narrowly, as not building new settlements or expropriating more land. Last week the quartet issued its own call for a complete settlement freeze.
The issue is so problematic here partly because the three-month-old government of Prime Minister Benjamin Netanyahu is a largely right-wing coalition with parties that support more settlement building. But Mr. Netanyahu recently accepted the idea of two states and has said Israel would work hard on helping the Palestinians improve their lives in the West Bank.
Mr. Barak said on Sunday that Israel was already making progress on that. It has formed a ministerial committee headed by Mr. Netanyahu aimed at starting economic projects in the West Bank. It has also given the Palestinian security forces greater freedom of action in the past couple of weeks.
Mr. Barak presented such steps as examples of concessions Israel had already made that deserved recognition from Washington and Arab leaders. Among the steps being discussed that Arab nations might take as confidence building measures for Israel are permitting Israeli travelers to transit through their airports, allowing Israeli airplanes to fly in their airspace and creating limited academic and tourist exchanges. Among Arab countries, only Egypt and Jordan have full diplomatic relations with Israel.
In the interview, Mr. Barak suggested that there could be a role for an international Middle East peace conference in the coming months at which all sides would agree to steps and concessions. He said that given Washington’s desire to remove its troops from Iraq and find a way to deal with Iran, this was an auspicious moment for bold regional thinking that could make far-reaching changes, and Israel was eager to play its part.
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