American Airlines to test in-flight Internet access for passengers this week
DAVID KOENIG
Copyright 2009 Associated Press
11:05 PM CDT, March 30, 2009
http://www.chicagotribune.com/travel/sns-ap-na-us-airborne-internet-american,0,3202551.story
DALLAS (AP) — American Airlines plans to expand Internet access to about half its fleet of aircraft over the next two years as it attempts to raise revenue and improve customer service.
The company said Tuesday it will install flying Wi-Fi hot spots on about 300 planes used in the continental U.S. and charge up to $12.95 for browsing the Web, sending e-mail or connecting with corporate VPN sites.
American has been testing in-flight Internet service for several months on 15 planes. The airline declined to give figures on usage during the test, but an American technology executive called the response positive.
"American Airlines is a very financially driven airline," said the executive, Doug Backelin. "We are especially careful in how we're spending, but this is a good strategic investment, something our customers will value."
AMR Corp.'s American is one of several U.S. carriers getting into Internet service. Delta Air Lines Inc., the world's largest airline operator, plans a quicker rollout, from about 80 planes currently to more than 300 late this year and more than 500 by the end of 2010.
Both airlines will use the Gogo service from Aircell. American will add access to many of its McDonnell Douglas MD-80 series aircraft beginning this year and on new Boeing 737-800 jets as it receives them.
Aircell sets the prices and shares revenue with the airline, although neither company would discuss their financial arrangement.
Prices will range from $5.95 for some redeye flights to $7.95 for using a handheld device, $9.95 for using a laptop computer on a flight up to three hours, and $12.95 for using a laptop on a longer flight. Aircell plans to add other prices for day passes and perhaps monthly subscription rates for frequent fliers.
Travelers can sign up on the ground and connect once the plane reaches 10,000 feet in altitude. They'll use their browser to connect to Aircell's Gogo portal site.
In theory, if enough passengers are online at the same time the speed of the service would degrade. Aircell Chief Executive Jack Blumenstein said that mass hasn't been reached on any trial flights. Each plane will be outfitted with three overlapping Wi-Fi signals, he said.
Backelin said the Internet access will be filtered to block pornographic sites — the airline at first said it wouldn't do that, but relented after hearing complaints from customers and flight attendants. And American won't allow voice-over-Internet phone service, to keep chattering to a minimum.
In customer surveys, Backelin said, "there was a very loud chorus telling us, 'Do not allow voice-over-IP calls in the cabin.'"
Tuesday, March 31, 2009
EHarmony launches gay matchmaking service
EHarmony launches gay matchmaking service - The heterosexual dating website agreed to start Compatible Partners for same-sex couples as part of the settlement of a discrimination suit.
By David Colker
Copyright © 2009, The Los Angeles Times
10:01 PM CDT, March 30, 2009
http://www.chicagotribune.com/features/la-fi-eharmony31-2009mar31,0,4312726.story
As of today, EHarmony comes out of the closet.
The adamantly heterosexual dating website, which has accepted only male-female couples since its inception in 2000, is launching a gay matchmaking service called Compatible Partners (www.compatiblepartners.net).
But EHarmony's new relationship with the gay community is more like a shotgun wedding: The company agreed in November to start the dating service as part of a settlement with the New Jersey attorney general in the wake of a discrimination suit.
Dating site consultant Mark Brooks says Compatible Partners will be watched closely.
"This will be one of the most scrutinized products in Internet dating," said Brooks, who hasn't worked for EHarmony. "They will have to introduce an A1 product."
It's not a comfortable fit for EHarmony's founder, Neil Clark Warren, who based the original service -- which requires applicants to fill out lengthy questionnaires -- on his own practice as a psychologist.
"It's what I did for 40 years," said Warren, 74, who is retired but remains on the board. "I never had a gay couple."
Warren is the former dean of the psychology graduate school at Fuller Theological Seminary in Pasadena. Much of the early promotion of EHarmony was done by well-known figures in the evangelical community, some of whom preach against gay rights.
As part of the settlement, Pasadena-based EHarmony must make a "good-faith commitment" to promoting Compatible Partners. But the company seems as nervous as the groom at a rehearsal dinner, insisting that the only on-the-record interview be with Chief Executive Greg Waldorf. That interview was canceled when the company learned Warren had spoken with The Times.
Brooks thinks Compatible Partners could be a winner.
"Niche products are proving to be very effective," he said. "People are more likely to connect with a brand that serves it, specifically."
Even Warren is finding out that gay couples might not be so different after all. He and his wife are friends with a male couple they met in Maine, where they live most of the year.
"I asked them, 'Are you guys committed?' " Warren said, "and one said yes and the other said, 'I think so.'
"And the first one said, 'You'd better be!' "
david.colker@latimes.com
By David Colker
Copyright © 2009, The Los Angeles Times
10:01 PM CDT, March 30, 2009
http://www.chicagotribune.com/features/la-fi-eharmony31-2009mar31,0,4312726.story
As of today, EHarmony comes out of the closet.
The adamantly heterosexual dating website, which has accepted only male-female couples since its inception in 2000, is launching a gay matchmaking service called Compatible Partners (www.compatiblepartners.net).
But EHarmony's new relationship with the gay community is more like a shotgun wedding: The company agreed in November to start the dating service as part of a settlement with the New Jersey attorney general in the wake of a discrimination suit.
Dating site consultant Mark Brooks says Compatible Partners will be watched closely.
"This will be one of the most scrutinized products in Internet dating," said Brooks, who hasn't worked for EHarmony. "They will have to introduce an A1 product."
It's not a comfortable fit for EHarmony's founder, Neil Clark Warren, who based the original service -- which requires applicants to fill out lengthy questionnaires -- on his own practice as a psychologist.
"It's what I did for 40 years," said Warren, 74, who is retired but remains on the board. "I never had a gay couple."
Warren is the former dean of the psychology graduate school at Fuller Theological Seminary in Pasadena. Much of the early promotion of EHarmony was done by well-known figures in the evangelical community, some of whom preach against gay rights.
As part of the settlement, Pasadena-based EHarmony must make a "good-faith commitment" to promoting Compatible Partners. But the company seems as nervous as the groom at a rehearsal dinner, insisting that the only on-the-record interview be with Chief Executive Greg Waldorf. That interview was canceled when the company learned Warren had spoken with The Times.
Brooks thinks Compatible Partners could be a winner.
"Niche products are proving to be very effective," he said. "People are more likely to connect with a brand that serves it, specifically."
Even Warren is finding out that gay couples might not be so different after all. He and his wife are friends with a male couple they met in Maine, where they live most of the year.
"I asked them, 'Are you guys committed?' " Warren said, "and one said yes and the other said, 'I think so.'
"And the first one said, 'You'd better be!' "
david.colker@latimes.com
Chicago Sun-Times files for bankruptcy
Chicago Sun-Times files for bankruptcy
By James P. Miller
Copyright © 2009, Chicago Tribune
8:36 AM CDT, March 31, 2009
http://www.chicagotribune.com/business/chi-biz-sun-times-media-bankruptcy-march31,0,3147313.story
The Sun-Times has filed for protection from creditors under Chapter 11 of the federal bankruptcy code. (Tribune photo by E. Jason Wambsgans / May 18, 2008)
Sun-Times Media Group Inc., reeling from a painful revenue decline and tax liabilities that date back to the looting of the company during the tenure of former CEO Conrad Black, disclosed Tuesday that it has filed for protection from creditors under Chapter 11 of the federal bankruptcy code.
The publisher of the Chicago Sun-Times and other Chicago-area papers emphasized that it will continue to operate its newspapers and online sites as usual "while it focuses on further improving its cost structure and stabilizing operations" during the Chapter 11 financial reorganization.
Tuesday's filing can't be characterized as a surprise. Many observers have marveled that the company has been able to stay on its feet as long as it has, given the pressures it faces.
The bankruptcy comes on the heels of a proxy fight that led to the ouster earlier this year of almost all of Sun-Times Media's former board members, and the subsequent exit of CEO Cyrus Freidheim, the turnaround expert brought in two years earlier to revive the company's fortunes.
Freidheim had been given the unenviable job of cleaning up the mess left after Conrad Black and his lieutenant, David Radler, diverted millions of dollars' in company revenue into their own pockets. Sun-Times' fortunes were also damaged by an embarassing and costly circulation-overstatement scandal that occurred when Radler was publisher of the Chicago Sun-Times.
Black and Radler were eventually covicted on criminal fraud charges and jailed, but the financial fallout from their actions has been an additional burden as Sun-Times Media fought to stay viable in a newspaper industry that has seen its century-old financial model upended.
Like other newspaper companies, Sun-Times has slashed repeatedly at its staffing levels in order to reduce costs, as ad revenues continued to dwindle because of recessionary pressures and an ongoing migration of advertisers' spending to less-costly Internet platforms.
Left-over issues from the Black era also played a role. Sun-Times Media recently paid $21 million to settle a lawsuit filed by a Canadian company that claimed Black deceived it when it purchased Canadian newspapers from the Chicago holding company several years ago. And although some tax claims from the company's financial footwork during the Black era have been resolved, others linger.
"Unfortunately," said Jeremy Halbreich, Chairman and interm CEO of the company, the "deteriorating economic climate, coupled with a significant pending IRS tax liability dating back to previous management, has led us to today's difficult action."
Sun-Times executives, he added, "firmly believe that filing for Chapter 11 protection and exploring the potential sale of assets or new investment in the company offers us the best opportunity to protect our respected media properties for the long term."
jpmiller@tribune.com
By James P. Miller
Copyright © 2009, Chicago Tribune
8:36 AM CDT, March 31, 2009
http://www.chicagotribune.com/business/chi-biz-sun-times-media-bankruptcy-march31,0,3147313.story
The Sun-Times has filed for protection from creditors under Chapter 11 of the federal bankruptcy code. (Tribune photo by E. Jason Wambsgans / May 18, 2008)
Sun-Times Media Group Inc., reeling from a painful revenue decline and tax liabilities that date back to the looting of the company during the tenure of former CEO Conrad Black, disclosed Tuesday that it has filed for protection from creditors under Chapter 11 of the federal bankruptcy code.
The publisher of the Chicago Sun-Times and other Chicago-area papers emphasized that it will continue to operate its newspapers and online sites as usual "while it focuses on further improving its cost structure and stabilizing operations" during the Chapter 11 financial reorganization.
Tuesday's filing can't be characterized as a surprise. Many observers have marveled that the company has been able to stay on its feet as long as it has, given the pressures it faces.
The bankruptcy comes on the heels of a proxy fight that led to the ouster earlier this year of almost all of Sun-Times Media's former board members, and the subsequent exit of CEO Cyrus Freidheim, the turnaround expert brought in two years earlier to revive the company's fortunes.
Freidheim had been given the unenviable job of cleaning up the mess left after Conrad Black and his lieutenant, David Radler, diverted millions of dollars' in company revenue into their own pockets. Sun-Times' fortunes were also damaged by an embarassing and costly circulation-overstatement scandal that occurred when Radler was publisher of the Chicago Sun-Times.
Black and Radler were eventually covicted on criminal fraud charges and jailed, but the financial fallout from their actions has been an additional burden as Sun-Times Media fought to stay viable in a newspaper industry that has seen its century-old financial model upended.
Like other newspaper companies, Sun-Times has slashed repeatedly at its staffing levels in order to reduce costs, as ad revenues continued to dwindle because of recessionary pressures and an ongoing migration of advertisers' spending to less-costly Internet platforms.
Left-over issues from the Black era also played a role. Sun-Times Media recently paid $21 million to settle a lawsuit filed by a Canadian company that claimed Black deceived it when it purchased Canadian newspapers from the Chicago holding company several years ago. And although some tax claims from the company's financial footwork during the Black era have been resolved, others linger.
"Unfortunately," said Jeremy Halbreich, Chairman and interm CEO of the company, the "deteriorating economic climate, coupled with a significant pending IRS tax liability dating back to previous management, has led us to today's difficult action."
Sun-Times executives, he added, "firmly believe that filing for Chapter 11 protection and exploring the potential sale of assets or new investment in the company offers us the best opportunity to protect our respected media properties for the long term."
jpmiller@tribune.com
Washington Post Editorial: JAMA's Hush-Up - A medical journal's problematic rule on public disclosure of complaints
Washington Post Editorial: JAMA's Hush-Up - A medical journal's problematic rule on public disclosure of complaints
Copyright by The Washington Post
Tuesday, March 31, 2009; Page A16
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/30/AR2009033002765.html
THE EDITORS of the Journal of the American Medical Association (JAMA) surely appreciated that Jonathan Leo, a professor at Lincoln Memorial University, made them aware of an undisclosed conflict involving a pharmaceutical company and the author of a study published in the journal. The JAMA editors did not, however, appreciate that Mr. Leo sent a copy of an e-mail to them to a reporter at the New York Times. Nor did they like his airing of his allegation in an article on the Web site of the British Medical Journal (BMJ) -- almost five months after Mr. Leo sent his initial inquiry to JAMA. As a result, the esteemed medical journal has instituted a new set of complaint compliance rules that leave us wondering whether it cares more about its reputation than the integrity of its articles.
The controversy surrounds a May 2008 study on the effects of an antidepressant drug on stroke patients by Robert Robinson and colleagues. JAMA requires disclosure of any financial relationships and other potential conflicts of interest by its authors. But Mr. Leo discovered that Mr. Robinson failed to disclose that he was on the speakers bureau of the company that made the drug that was the subject of his study. On March 5, six days before the journal was to publish the details of its investigation into Mr. Robinson's incomplete disclosure, Mr. Leo went public with his piece for BMJ.
The new rules from JAMA, announced in its March 20 edition, discourage such third-party disclosure from happening again. "The person bringing the allegation will be specifically informed that he/she should not reveal this information to third parties or the media while the investigation is under way," the editors wrote. Cathy DeAngelis, editor of JAMA, told us that the journal "can do nothing if the 'accuser' goes public, and we do not intend to try." But her insistence that concern for "[p]rotecting the accused person and thereby assuring due process" while the journal conducts its review misses the larger point of Mr. Leo's going public. This is a matter of transparency: If the information in scientific journals and studies is not free of conflicts, its value is diminished and its authors and the publications become suspect.
JAMA's commitment to keep those who bring allegations informed of the investigation's progress and its completion helps with transparency. So does its commitment to immediately put its findings on the Web, instead of waiting until the magazine's next publication date. Muzzling whistleblowers might help JAMA control its image -- but it's a disservice to the public.
Copyright by The Washington Post
Tuesday, March 31, 2009; Page A16
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/30/AR2009033002765.html
THE EDITORS of the Journal of the American Medical Association (JAMA) surely appreciated that Jonathan Leo, a professor at Lincoln Memorial University, made them aware of an undisclosed conflict involving a pharmaceutical company and the author of a study published in the journal. The JAMA editors did not, however, appreciate that Mr. Leo sent a copy of an e-mail to them to a reporter at the New York Times. Nor did they like his airing of his allegation in an article on the Web site of the British Medical Journal (BMJ) -- almost five months after Mr. Leo sent his initial inquiry to JAMA. As a result, the esteemed medical journal has instituted a new set of complaint compliance rules that leave us wondering whether it cares more about its reputation than the integrity of its articles.
The controversy surrounds a May 2008 study on the effects of an antidepressant drug on stroke patients by Robert Robinson and colleagues. JAMA requires disclosure of any financial relationships and other potential conflicts of interest by its authors. But Mr. Leo discovered that Mr. Robinson failed to disclose that he was on the speakers bureau of the company that made the drug that was the subject of his study. On March 5, six days before the journal was to publish the details of its investigation into Mr. Robinson's incomplete disclosure, Mr. Leo went public with his piece for BMJ.
The new rules from JAMA, announced in its March 20 edition, discourage such third-party disclosure from happening again. "The person bringing the allegation will be specifically informed that he/she should not reveal this information to third parties or the media while the investigation is under way," the editors wrote. Cathy DeAngelis, editor of JAMA, told us that the journal "can do nothing if the 'accuser' goes public, and we do not intend to try." But her insistence that concern for "[p]rotecting the accused person and thereby assuring due process" while the journal conducts its review misses the larger point of Mr. Leo's going public. This is a matter of transparency: If the information in scientific journals and studies is not free of conflicts, its value is diminished and its authors and the publications become suspect.
JAMA's commitment to keep those who bring allegations informed of the investigation's progress and its completion helps with transparency. So does its commitment to immediately put its findings on the Web, instead of waiting until the magazine's next publication date. Muzzling whistleblowers might help JAMA control its image -- but it's a disservice to the public.
FDA Says to Avoid Pistachios Amid Salmonella Scare
FDA Says to Avoid Pistachios Amid Salmonella Scare
By GARANCE BURKE
Copyright by The Associated Press
Monday, March 30, 2009; 11:53 PM
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/30/AR2009033002637.html?hpid=artslot
FRESNO, Calif. -- Federal food safety officials warned Monday that consumers should stop eating all foods containing pistachios while they figure out the source of a possible salmonella contamination.
Still reeling from the national salmonella outbreak in peanuts, the Food and Drug Administration said central California-based Setton Pistachio of Terra Bella Inc., the nation's second-largest pistachio processor, was voluntarily recalling a portion of the roasted nuts it has been shipping since last fall. A Setton spokeswoman said that amounts to more than 2 million pounds of nuts.
"Our advice to consumers is that they avoid eating pistachio products, and that they hold onto those products," said Dr. David Acheson, assistant commissioner for food safety. "The number of products that are going to be recalled over the coming days will grow, simply because these pistachio nuts have then been repackaged into consumer-level containers."
Two people called the FDA complaining of gastrointestinal illness that could be associated with the nuts, but the link hasn't been confirmed, Acheson said. Still, the plant decided to shut down late last week, officials said.
The recalled nuts represent a small fraction of the 55 million pounds of pistachios that the company's plant processed last year and an even smaller portion of the 278 million pounds produced in the state in the 2008 season, according to the Fresno-based Administrative Committee for Pistachios.
California alone is the second-largest producer of pistachios in the world.
According to the company's Web site, Setton Pistachio is in the corporate family of Commack, N.Y.-based Setton International Foods Inc. The company sells nuts, dried fruit, edible seeds, chocolate and yogurt-coated candies.
The FDA learned about the problem last Tuesday, when Kraft Foods Inc. notified the agency that it had detected salmonella in roasted pistachios through routine product testing. Kraft and the Georgia Nut Co. recalled their Back to Nature Nantucket Blend trail mix the next day.
The FDA contacted Setton Pistachio and California health officials shortly afterward, in what Acheson called a "proactive move."
By Friday, grocery operator Kroger Co. recalled one of its lines of bagged pistachios because of possible salmonella contamination, saying the California plant also supplied its nuts. Those nuts were sold in 31 states.
Fabia D'Arienzo, a spokeswoman for Tulare County-based Setton Pistachio, said the company was only recalling certain bulk roasted in-shell and roasted shelled pistachios that were shipped on or after September 1.
Because Setton Pistachio shipped tote bags of nuts weighing up to 2,000 pounds to 36 wholesalers across the country, it will take weeks to figure out how many products could be affected, said Jeff Farrar, chief of the Food and Drug Branch of the California Department of Public Health.
"It will be safe to assume based on the volume that this will be an ingredient in a lot of different products, and that may possibly include things like ice cream and cake mixes," Farrar said. "The firm is already turning around trucks in transit to bring those back to the facility."
Salmonella, the most common cause of food-borne illness, is a bacteria that causes diarrhea, fever and cramping. Most people recover, but the infection can be life-threatening for children, the elderly and people with weakened immune systems.
For nuts, roasting is supposed to kill the bacteria. But problems can occur if the roasting is not done correctly or if roasted nuts are re-contaminated. That can happen if mice, rats or birds get into the facility.
Last winter, a national salmonella outbreak was blamed on a Georgia company under federal investigation for flouting safety procedures and knowingly shipping contaminated peanuts.
The outbreak is still ongoing. More than 690 people in 46 states have gotten sick. Nearly 3,900 products made with peanut ingredients from Peanut Corp of America have been recalled.
California public health authorities have taken hundreds of samples at Setton's processing facility, but lab results have not yet determined whether salmonella was found at the plant, Farrar said. The food companies' own tests of the contaminated products isolated four different types of salmonella, but none were the same strain as the one found in the peanuts, Acheson said.
Associated Press writers Ricardo Alonso-Zaldivar in Washington and Tracie Cone in Fresno contributed to this report.
By GARANCE BURKE
Copyright by The Associated Press
Monday, March 30, 2009; 11:53 PM
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/30/AR2009033002637.html?hpid=artslot
FRESNO, Calif. -- Federal food safety officials warned Monday that consumers should stop eating all foods containing pistachios while they figure out the source of a possible salmonella contamination.
Still reeling from the national salmonella outbreak in peanuts, the Food and Drug Administration said central California-based Setton Pistachio of Terra Bella Inc., the nation's second-largest pistachio processor, was voluntarily recalling a portion of the roasted nuts it has been shipping since last fall. A Setton spokeswoman said that amounts to more than 2 million pounds of nuts.
"Our advice to consumers is that they avoid eating pistachio products, and that they hold onto those products," said Dr. David Acheson, assistant commissioner for food safety. "The number of products that are going to be recalled over the coming days will grow, simply because these pistachio nuts have then been repackaged into consumer-level containers."
Two people called the FDA complaining of gastrointestinal illness that could be associated with the nuts, but the link hasn't been confirmed, Acheson said. Still, the plant decided to shut down late last week, officials said.
The recalled nuts represent a small fraction of the 55 million pounds of pistachios that the company's plant processed last year and an even smaller portion of the 278 million pounds produced in the state in the 2008 season, according to the Fresno-based Administrative Committee for Pistachios.
California alone is the second-largest producer of pistachios in the world.
According to the company's Web site, Setton Pistachio is in the corporate family of Commack, N.Y.-based Setton International Foods Inc. The company sells nuts, dried fruit, edible seeds, chocolate and yogurt-coated candies.
The FDA learned about the problem last Tuesday, when Kraft Foods Inc. notified the agency that it had detected salmonella in roasted pistachios through routine product testing. Kraft and the Georgia Nut Co. recalled their Back to Nature Nantucket Blend trail mix the next day.
The FDA contacted Setton Pistachio and California health officials shortly afterward, in what Acheson called a "proactive move."
By Friday, grocery operator Kroger Co. recalled one of its lines of bagged pistachios because of possible salmonella contamination, saying the California plant also supplied its nuts. Those nuts were sold in 31 states.
Fabia D'Arienzo, a spokeswoman for Tulare County-based Setton Pistachio, said the company was only recalling certain bulk roasted in-shell and roasted shelled pistachios that were shipped on or after September 1.
Because Setton Pistachio shipped tote bags of nuts weighing up to 2,000 pounds to 36 wholesalers across the country, it will take weeks to figure out how many products could be affected, said Jeff Farrar, chief of the Food and Drug Branch of the California Department of Public Health.
"It will be safe to assume based on the volume that this will be an ingredient in a lot of different products, and that may possibly include things like ice cream and cake mixes," Farrar said. "The firm is already turning around trucks in transit to bring those back to the facility."
Salmonella, the most common cause of food-borne illness, is a bacteria that causes diarrhea, fever and cramping. Most people recover, but the infection can be life-threatening for children, the elderly and people with weakened immune systems.
For nuts, roasting is supposed to kill the bacteria. But problems can occur if the roasting is not done correctly or if roasted nuts are re-contaminated. That can happen if mice, rats or birds get into the facility.
Last winter, a national salmonella outbreak was blamed on a Georgia company under federal investigation for flouting safety procedures and knowingly shipping contaminated peanuts.
The outbreak is still ongoing. More than 690 people in 46 states have gotten sick. Nearly 3,900 products made with peanut ingredients from Peanut Corp of America have been recalled.
California public health authorities have taken hundreds of samples at Setton's processing facility, but lab results have not yet determined whether salmonella was found at the plant, Farrar said. The food companies' own tests of the contaminated products isolated four different types of salmonella, but none were the same strain as the one found in the peanuts, Acheson said.
Associated Press writers Ricardo Alonso-Zaldivar in Washington and Tracie Cone in Fresno contributed to this report.
New York Times Editorial: Evolutionary Semantics, Texas-Style
New York Times Editorial: Evolutionary Semantics, Texas-Style
Copyright by The New York Times
Published: March 30, 2009
http://www.nytimes.com/2009/03/31/opinion/31tue3.html?ref=global
The Texas Board of Education gave grudging support last week to teaching the mainstream theory of evolution without the most troubling encumbrances sought by religious and social conservatives. But the margins on crucial amendments were disturbingly close, typically a single vote on a 15-member board, and compromise language left ample room for the struggle to continue.
This was not a straightforward battle over whether to include creationism or its close cousin, intelligent design, in the science curriculum. That battle has been lost by Darwin’s opponents in the courts, the schools and most political arenas.
Rather, this was a struggle to insert into the state science standards various phrases and code words that may seem innocuous or meaningless at first glance but could open the door to doubts about evolution. In the most ballyhooed vote, those like us who support the teaching of sound science can claim a narrow victory.
Conservatives tried — but failed — to reinsert a phrase requiring students to study the “strengths and weaknesses” of all scientific theories, including evolution. That language had been in the standards for years, but it was eliminated by experts who prepared the new standards for board approval because it has become a banner for critics of Darwinian evolution who seek to exaggerate supposed weaknesses in the theory.
The conservatives also narrowly lost attempts to have students study the “sufficiency or insufficiency” of natural selection to explain the complexities of the cell, a major issue for proponents of intelligent design. The conservatives also failed to get the word “sufficiency” inserted by itself, presumably because that would imply insufficiency as well. They had to settle for language requiring students to “analyze, evaluate and critique” scientific explanations and examine “all sides” of the scientific evidence.
At the end of a tense, confusing three-day meeting, Darwin’s critics claimed that this and other compromise language amounted to a huge victory that would still allow their critiques into textbooks and classrooms. One can only hope that teachers in Texas will use common sense and teach evolution as scientists understand it.
Copyright by The New York Times
Published: March 30, 2009
http://www.nytimes.com/2009/03/31/opinion/31tue3.html?ref=global
The Texas Board of Education gave grudging support last week to teaching the mainstream theory of evolution without the most troubling encumbrances sought by religious and social conservatives. But the margins on crucial amendments were disturbingly close, typically a single vote on a 15-member board, and compromise language left ample room for the struggle to continue.
This was not a straightforward battle over whether to include creationism or its close cousin, intelligent design, in the science curriculum. That battle has been lost by Darwin’s opponents in the courts, the schools and most political arenas.
Rather, this was a struggle to insert into the state science standards various phrases and code words that may seem innocuous or meaningless at first glance but could open the door to doubts about evolution. In the most ballyhooed vote, those like us who support the teaching of sound science can claim a narrow victory.
Conservatives tried — but failed — to reinsert a phrase requiring students to study the “strengths and weaknesses” of all scientific theories, including evolution. That language had been in the standards for years, but it was eliminated by experts who prepared the new standards for board approval because it has become a banner for critics of Darwinian evolution who seek to exaggerate supposed weaknesses in the theory.
The conservatives also narrowly lost attempts to have students study the “sufficiency or insufficiency” of natural selection to explain the complexities of the cell, a major issue for proponents of intelligent design. The conservatives also failed to get the word “sufficiency” inserted by itself, presumably because that would imply insufficiency as well. They had to settle for language requiring students to “analyze, evaluate and critique” scientific explanations and examine “all sides” of the scientific evidence.
At the end of a tense, confusing three-day meeting, Darwin’s critics claimed that this and other compromise language amounted to a huge victory that would still allow their critiques into textbooks and classrooms. One can only hope that teachers in Texas will use common sense and teach evolution as scientists understand it.
Europe spurns the beloved Obama
Europe spurns the beloved Obama
By Gideon Rachman
Copyright The Financial Times Limited 2009
Published: March 30 2009 20:18 | Last updated: March 30 2009 20:18
http://www.ft.com/cms/s/0/32902674-1d55-11de-9eb3-00144feabdc0.html
Europeans have long worshipped Barack Obama from afar. Now the beloved one is paying his first visit as US president to the old continent. Yet there is every indication that Europe’s leaders are about to stiff him.
Mr Obama is on a rapid-fire tour that will take him from the Group of 20 meeting in London to a Nato summit in Strasbourg, then on to a US-European Union meeting in Prague and, finally, a state visit in Turkey. But he will be lucky to return from Europe with much more than commemorative photos and some presents for the kids. (“I went to the G20 summit in London and all I got was this lousy T-shirt.”)
If you look at Mr Obama’s top priorities, you get a sense of just how little the Europeans are prepared to give him. More help in Afghanistan? Most Europeans will do the bare minimum. A co-ordinated fiscal stimulus? Sorry, Europe is out of cash as well as troops.
Europe’s grudging attitude to the new president is not only discourteous. It is unwise and self-defeating. Mr Obama is an internationalist. But the American public is war weary and preoccupied by the domestic economic disaster. If even a liberal, internationalist president seems to be getting nothing out of America’s allies, then protectionist and isolationist voices in Congress will only get louder.
Any such development would be disastrous for Europe. The US remains the core of the global economy and the guarantor of security in Europe. The continent’s leaders have a huge interest in fostering and fanning the new American internationalism represented by Mr Obama. Instead, they seem to be doing their utmost to pour cold water on it.
Already you hear grumbles in Europe that the new president has little instinctive sympathy for or understanding of Europeans (unlike that nice George W. Bush). There are complaints that the Obama administration is too concerned with domestic affairs. The president is accused of being too casual with European visitors. How dare he give the visiting British prime minister a box of old films? Couldn’t he think of something more lavish?
This is pathetic stuff. If you look at the actual substance of what his administration has been doing, Obama has made a point of moving significantly on four issues that bedevilled US-European relations during the Bush years: climate change, Guantánamo, Iraq and Iran. The prison camp at Guantánamo Bay is to be closed. Mr Obama has appointed people such as Steven Chu, the new energy secretary, who are passionate about tackling global warming. He has announced a timetable for withdrawal from Iraq. And he has launched a diplomatic initiative with Iran.
Naturally, the Obama administration wants something in return from the Europeans. A few months ago the Americans were hoping that their allies might come up with more troops for Afghanistan, and relax some of the notorious “caveats” that restrict what German soldiers, in particular, can do. That hope has proved largely vain. The British might send a couple of thousand more troops. The Poles and Italians could also chip in. But any new European contribution will be feeble compared with the 21,000 extra troops that the US is committing.
Rather than confront the Europeans on the issue of troops, the Obama administration has decided to try to find other areas in which Europe could contribute. A laundry list of such actions will be flourished at the Nato summit; more money, more Europeans to train the Afghan army and police. But while the list will be long, it will not be all that impressive. There will certainly be nothing to compare with Japan’s decision to pay the entire salary bill for the Afghan police for the next six months.
There are aspects of Mr Obama’s new Afghanistan policy that can be legitimately disagreed with. The decision to expand the fight inside Pakistan looks risky. But allied reservations would be listened to with more attention if the Europeans were prepared to make more effort themselves. Mr Obama is certainly right when he insists that the fight in Afghanistan is one that concerns the entire western world. A resurgent al-Qaeda would be just as big a threat to Europe as to the US.
It is the same story on Iran. The Europeans say they are very pleased with Mr Obama’s new tone. But there is little indication that the Germans, in particular, are prepared to tighten sanctions, should diplomacy stall and Iran’s nuclear programme accelerate.
The G20 summit in London is also being overshadowed by a US-European dispute about how to respond to the economic crisis. The Americans want to emphasise co-ordinated Keynesian spending to jolt the world economy back into life. Many Europeans are sceptical. Mirek Topolanek, the recently deposed Czech prime minister – apparently inspired by watching AC/DC perform “Highway to Hell” in Prague – has helpfully warned that US economic policy has put the country on the “road to hell”. This has set just the right atmosphere for the EU-US summit in Prague next weekend.
The Europeans would rather emphasise institutional reform than fiscal stimuli. Both ideas will get a nod in the G20 communiqué. But the American emphasis on dealing with the immediate crisis is surely preferable to the European predilection for abstract discussions of institutions.
Mr Obama was the president that Europeans hoped and prayed for. Now they have got him, they need to give him some help.
gideon.rachman@ft.com
Post and read comments at Gideon Rachman’s blog
More columns at www.ft.com/gideonrachman
By Gideon Rachman
Copyright The Financial Times Limited 2009
Published: March 30 2009 20:18 | Last updated: March 30 2009 20:18
http://www.ft.com/cms/s/0/32902674-1d55-11de-9eb3-00144feabdc0.html
Europeans have long worshipped Barack Obama from afar. Now the beloved one is paying his first visit as US president to the old continent. Yet there is every indication that Europe’s leaders are about to stiff him.
Mr Obama is on a rapid-fire tour that will take him from the Group of 20 meeting in London to a Nato summit in Strasbourg, then on to a US-European Union meeting in Prague and, finally, a state visit in Turkey. But he will be lucky to return from Europe with much more than commemorative photos and some presents for the kids. (“I went to the G20 summit in London and all I got was this lousy T-shirt.”)
If you look at Mr Obama’s top priorities, you get a sense of just how little the Europeans are prepared to give him. More help in Afghanistan? Most Europeans will do the bare minimum. A co-ordinated fiscal stimulus? Sorry, Europe is out of cash as well as troops.
Europe’s grudging attitude to the new president is not only discourteous. It is unwise and self-defeating. Mr Obama is an internationalist. But the American public is war weary and preoccupied by the domestic economic disaster. If even a liberal, internationalist president seems to be getting nothing out of America’s allies, then protectionist and isolationist voices in Congress will only get louder.
Any such development would be disastrous for Europe. The US remains the core of the global economy and the guarantor of security in Europe. The continent’s leaders have a huge interest in fostering and fanning the new American internationalism represented by Mr Obama. Instead, they seem to be doing their utmost to pour cold water on it.
Already you hear grumbles in Europe that the new president has little instinctive sympathy for or understanding of Europeans (unlike that nice George W. Bush). There are complaints that the Obama administration is too concerned with domestic affairs. The president is accused of being too casual with European visitors. How dare he give the visiting British prime minister a box of old films? Couldn’t he think of something more lavish?
This is pathetic stuff. If you look at the actual substance of what his administration has been doing, Obama has made a point of moving significantly on four issues that bedevilled US-European relations during the Bush years: climate change, Guantánamo, Iraq and Iran. The prison camp at Guantánamo Bay is to be closed. Mr Obama has appointed people such as Steven Chu, the new energy secretary, who are passionate about tackling global warming. He has announced a timetable for withdrawal from Iraq. And he has launched a diplomatic initiative with Iran.
Naturally, the Obama administration wants something in return from the Europeans. A few months ago the Americans were hoping that their allies might come up with more troops for Afghanistan, and relax some of the notorious “caveats” that restrict what German soldiers, in particular, can do. That hope has proved largely vain. The British might send a couple of thousand more troops. The Poles and Italians could also chip in. But any new European contribution will be feeble compared with the 21,000 extra troops that the US is committing.
Rather than confront the Europeans on the issue of troops, the Obama administration has decided to try to find other areas in which Europe could contribute. A laundry list of such actions will be flourished at the Nato summit; more money, more Europeans to train the Afghan army and police. But while the list will be long, it will not be all that impressive. There will certainly be nothing to compare with Japan’s decision to pay the entire salary bill for the Afghan police for the next six months.
There are aspects of Mr Obama’s new Afghanistan policy that can be legitimately disagreed with. The decision to expand the fight inside Pakistan looks risky. But allied reservations would be listened to with more attention if the Europeans were prepared to make more effort themselves. Mr Obama is certainly right when he insists that the fight in Afghanistan is one that concerns the entire western world. A resurgent al-Qaeda would be just as big a threat to Europe as to the US.
It is the same story on Iran. The Europeans say they are very pleased with Mr Obama’s new tone. But there is little indication that the Germans, in particular, are prepared to tighten sanctions, should diplomacy stall and Iran’s nuclear programme accelerate.
The G20 summit in London is also being overshadowed by a US-European dispute about how to respond to the economic crisis. The Americans want to emphasise co-ordinated Keynesian spending to jolt the world economy back into life. Many Europeans are sceptical. Mirek Topolanek, the recently deposed Czech prime minister – apparently inspired by watching AC/DC perform “Highway to Hell” in Prague – has helpfully warned that US economic policy has put the country on the “road to hell”. This has set just the right atmosphere for the EU-US summit in Prague next weekend.
The Europeans would rather emphasise institutional reform than fiscal stimuli. Both ideas will get a nod in the G20 communiqué. But the American emphasis on dealing with the immediate crisis is surely preferable to the European predilection for abstract discussions of institutions.
Mr Obama was the president that Europeans hoped and prayed for. Now they have got him, they need to give him some help.
gideon.rachman@ft.com
Post and read comments at Gideon Rachman’s blog
More columns at www.ft.com/gideonrachman
Complaints of internet crime hit record in US
Complaints of internet crime hit record in US
By Joseph Menn in San Francisco
Copyright The Financial Times Limited 2009
Published: March 31 2009 00:32 | Last updated: March 31 2009 00:32
http://www.ft.com/cms/s/0/e160f504-1d76-11de-9eb3-00144feabdc0.html
Victims of internet crime filed 33 per cent more complaints in the US last year than the year before, signally that electronic fraud is being exasperated by the economic crisis.
The Internet Crime Complaint Center, which tracks trends and refers cases to law enforcement agencies for investigation, said on Monday that it processed a record 275,284 complaints last year.
The number filed each month grew as the year progressed and the economy deteriorated. October, November and December were three of the worst five months.
The most frequent complaints – some 33 per cent – were over electronic correspondents failing to deliver promised goods or failing to pay for goods they received. Auction fraud at sites such as Ebay and Craigslist drove another 25 per cent of the cases.
“Anecdotally, there’s some indication that the economy is a factor,” said spokesman Paul Bresson of the Federal Bureau of Investigation, which helps run the Complaint Center.
Harder times might tempt more unemployed to turn to crime, and they can also provide more subtle support for an upward trend. Budget-conscious consumers look harder for bargains, falling for more too-good-to-be-true offers.
The spike could also derive in part from increased consumer awareness of the Complaint Center and referral links on web pages hosted by Ebay and other companies.
Those seeking work can become victims when they are hired to process funds by crooks who drain their bank accounts. Another popular trick involves apparent overpayments to new landlords or sellers, who are instructed to return some of the money before learning that the original cheque is no good.
The total loss of victims filed at the complaint centre reached another record, $265m – up from $239m in 2007. Victims of cheque fraud lost the most, a median of $3,000.
Reports to the Complaint Center provide only a partial picture. Only about one in seven fraud cases get reported anywhere, and many victims who do complain go to police or other officials instead of to the nine-year-old centre.
By Joseph Menn in San Francisco
Copyright The Financial Times Limited 2009
Published: March 31 2009 00:32 | Last updated: March 31 2009 00:32
http://www.ft.com/cms/s/0/e160f504-1d76-11de-9eb3-00144feabdc0.html
Victims of internet crime filed 33 per cent more complaints in the US last year than the year before, signally that electronic fraud is being exasperated by the economic crisis.
The Internet Crime Complaint Center, which tracks trends and refers cases to law enforcement agencies for investigation, said on Monday that it processed a record 275,284 complaints last year.
The number filed each month grew as the year progressed and the economy deteriorated. October, November and December were three of the worst five months.
The most frequent complaints – some 33 per cent – were over electronic correspondents failing to deliver promised goods or failing to pay for goods they received. Auction fraud at sites such as Ebay and Craigslist drove another 25 per cent of the cases.
“Anecdotally, there’s some indication that the economy is a factor,” said spokesman Paul Bresson of the Federal Bureau of Investigation, which helps run the Complaint Center.
Harder times might tempt more unemployed to turn to crime, and they can also provide more subtle support for an upward trend. Budget-conscious consumers look harder for bargains, falling for more too-good-to-be-true offers.
The spike could also derive in part from increased consumer awareness of the Complaint Center and referral links on web pages hosted by Ebay and other companies.
Those seeking work can become victims when they are hired to process funds by crooks who drain their bank accounts. Another popular trick involves apparent overpayments to new landlords or sellers, who are instructed to return some of the money before learning that the original cheque is no good.
The total loss of victims filed at the complaint centre reached another record, $265m – up from $239m in 2007. Victims of cheque fraud lost the most, a median of $3,000.
Reports to the Complaint Center provide only a partial picture. Only about one in seven fraud cases get reported anywhere, and many victims who do complain go to police or other officials instead of to the nine-year-old centre.
US housing price freefall extends into January
US housing price freefall extends into January
By Simone Baribeau in New York
Copyright The Financial Times Limited 2009
Published: March 31 2009 14:54 | Last updated: March 31 2009 14:54
http://www.ft.com/cms/s/0/3de81a3c-1df9-11de-830b-00144feabdc0.html
Single family home prices in the 20 largest metropolitan areas dropped 2.8 per cent in January, according to Case-Shiller’s index of the 20 largest US cities, another sign that the housing market bottom may still be distant.
Nationwide home prices are down 19 per cent on the year, the largest fall since the index started in 2000. Home prices in the 10 largest metropolitan areas dropped 2.5 per cent in January, leaving them more than 30 per cent below their peak in mid-2006. Prices, which rose at roughly the rate of inflation over the first 13 years of the index, grew more than 90 per cent in real terms between 2000 and the market’s peak.
“[There is] no let-up in home price misery with the Case Shiller data 20 major cities number showing no sign of price decline deceleration,” said Alan Ruskin strategist at RBS Capital. “If there is some hope it largely centers on the idea that the data is unlikely to continue to record large price declines [month on month], but unfortunately that does not suggest that a bottom is anywhere close at hand.”
The price declines were widespread, with the Las Vegas, Minneapolis, Detroit, Chicago, Tampa, and San Francisco metropolitan areas all losing more than 4 per cent.
Nationwide housing prices have about another 20 per cent to fall before they stabilise, said Dean Baker, co-director of the Center for Economic and Policy Research, who has been warning of an inflated housing market since 2002.
But with home prices falling at around 2 per cent a month, he said, “I think the real question is whether they overshoot.” Some markets, including Cleveland and Detroit, may already be selling at a discount, he said.
Other housing price indices have been showing glimmers of hope for home price stability. The National Association of Realtors’ initial estimates of home prices in February showed prices remained virtually unchanged from January to February, after falling 15.5 per cent on the year. According to the Office of Federal Housing Enterprise Oversight, which tracks purchase prices of houses with conforming loans, home prices rose 1.7 per cent from December to January but the increase was due largely to a change in the geographic mix of the sales.
“The last thing to turn will be the 10-city index,” which contains some of the most overbuilt areas, said Mark Zandi, chief economist at Moody’s Economy.com, who estimates home prices will fall another 10-15 per cent before stabilising.
He said prices were unlikely to fall to that level before next year and risked overshooting on the downside if the White House’s efforts to mitigate foreclosures do not kick in by the end of the year, but added that was “still a risky forecast”.
Meanwhile, the Chicago Business Barometer fell to 31.4 in March from 34.2 in February to its lowest level in over 29 years, the Institute for Supply Management-Chicago said on Tuesday.
By Simone Baribeau in New York
Copyright The Financial Times Limited 2009
Published: March 31 2009 14:54 | Last updated: March 31 2009 14:54
http://www.ft.com/cms/s/0/3de81a3c-1df9-11de-830b-00144feabdc0.html
Single family home prices in the 20 largest metropolitan areas dropped 2.8 per cent in January, according to Case-Shiller’s index of the 20 largest US cities, another sign that the housing market bottom may still be distant.
Nationwide home prices are down 19 per cent on the year, the largest fall since the index started in 2000. Home prices in the 10 largest metropolitan areas dropped 2.5 per cent in January, leaving them more than 30 per cent below their peak in mid-2006. Prices, which rose at roughly the rate of inflation over the first 13 years of the index, grew more than 90 per cent in real terms between 2000 and the market’s peak.
“[There is] no let-up in home price misery with the Case Shiller data 20 major cities number showing no sign of price decline deceleration,” said Alan Ruskin strategist at RBS Capital. “If there is some hope it largely centers on the idea that the data is unlikely to continue to record large price declines [month on month], but unfortunately that does not suggest that a bottom is anywhere close at hand.”
The price declines were widespread, with the Las Vegas, Minneapolis, Detroit, Chicago, Tampa, and San Francisco metropolitan areas all losing more than 4 per cent.
Nationwide housing prices have about another 20 per cent to fall before they stabilise, said Dean Baker, co-director of the Center for Economic and Policy Research, who has been warning of an inflated housing market since 2002.
But with home prices falling at around 2 per cent a month, he said, “I think the real question is whether they overshoot.” Some markets, including Cleveland and Detroit, may already be selling at a discount, he said.
Other housing price indices have been showing glimmers of hope for home price stability. The National Association of Realtors’ initial estimates of home prices in February showed prices remained virtually unchanged from January to February, after falling 15.5 per cent on the year. According to the Office of Federal Housing Enterprise Oversight, which tracks purchase prices of houses with conforming loans, home prices rose 1.7 per cent from December to January but the increase was due largely to a change in the geographic mix of the sales.
“The last thing to turn will be the 10-city index,” which contains some of the most overbuilt areas, said Mark Zandi, chief economist at Moody’s Economy.com, who estimates home prices will fall another 10-15 per cent before stabilising.
He said prices were unlikely to fall to that level before next year and risked overshooting on the downside if the White House’s efforts to mitigate foreclosures do not kick in by the end of the year, but added that was “still a risky forecast”.
Meanwhile, the Chicago Business Barometer fell to 31.4 in March from 34.2 in February to its lowest level in over 29 years, the Institute for Supply Management-Chicago said on Tuesday.
Japan outlines new stimulus move
Japan outlines new stimulus move
By Michiyo Nakamoto in Tokyo
Copyright The Financial Times Limited 2009
Published: March 31 2009 10:36 | Last updated: March 31 2009 10:36
http://www.ft.com/cms/s/0/64362f08-1dd6-11de-830b-00144feabdc0.html
Taro Aso on Tuesday instructed his ministers to compile a new economic stimulus package “as soon as possible before mid-April” in addition to a longer-term programme for growth.
“The Japanese economy is still in a critical situation,” Mr Aso said.
“I would like to make utmost efforts (to stimulate the economy) based on bold thinking,” he said.
The new stimulus package, which came just ahead of Mr Aso’s departure to join world leaders at the G20 summit in London on Wednesday, will have three main priorities: to ensure that the Japanese economy does not deteriorate further, to maintain jobs and boost Japan’s future growth potential, Mr Aso said.
The additional stimulus package comes as government figures showed unemployment rose to a three-year high of 4.4 per cent and the number of new jobs created sank to a 6-year low. Meanwhile, household spending fell 3.5 per cent year-on-year, a 12th consecutive monthly decline.
Japan’s Financial Services Agency is to inspect banks and credit associations to ensure they are extending loans to keep liquidity flowing to companies in need, Reuters reported on Tuesday.
Japan has already committed Y12,000bn in fiscal spending to revive the ailing economy and Mr Aso said the execution of those measures would be frontloaded as much as possible.
The prime minister failed to indicate how much more spending the new measures would entail, saying only that the cost of the package would depend on the details.
With the new package, Japan’s fiscal spending to combat the adverse effects of the global crisis, is likely to comfortably exceed the 2 per cent of GDP recommended by the IMF.
The new economic stimulus measures come as the Organisation for Economic Cooperation and Development warned that “the unemployment rate is likely to rise above 5.5 per cent and deflation may become entrenched.”
The OECD urged the Bank of Japan to keep the benchmark interest rate near zero and increase liquidity and recommended the Japanese government reform the tax system to promote growth.
The Nikkei stock average closed moderately lower amid concerns about the future outlook following nervousness in the US market over the fate of the car and banking industries.
Meanwhile, the ruling Liberal Democratic Party yesterday decided to submit legislation that would allow the use of public funds to buy exchange traded funds and real estate investment trusts, in a desperate bid to bolster Japan’s sagging markets.
Mr Aso said further that the government was considering measures to channel Japan’s Y1,400,000bn in household financial assets, much of which is held by the elderly, towards consumption.
The government is also working on a long-term growth programme that would bring the public and private sectors together to create new jobs and stimulate demand, Mr Aso said.
The programme will aim to stimulate growth by channelling Japan’s strength in environmental technology, animation, fashion and popular music to revenue-generating businesses.
Japan will also use its financial resources, including overseas development aid, to stimulate growth in Asia, Mr Aso said.
“It is important to look beyond Japan’s borders and think about Asian growth as a whole,” he said.
“I would like Japan to use its technology to lead a low-carbon revolution,” Mr Aso said.
By Michiyo Nakamoto in Tokyo
Copyright The Financial Times Limited 2009
Published: March 31 2009 10:36 | Last updated: March 31 2009 10:36
http://www.ft.com/cms/s/0/64362f08-1dd6-11de-830b-00144feabdc0.html
Taro Aso on Tuesday instructed his ministers to compile a new economic stimulus package “as soon as possible before mid-April” in addition to a longer-term programme for growth.
“The Japanese economy is still in a critical situation,” Mr Aso said.
“I would like to make utmost efforts (to stimulate the economy) based on bold thinking,” he said.
The new stimulus package, which came just ahead of Mr Aso’s departure to join world leaders at the G20 summit in London on Wednesday, will have three main priorities: to ensure that the Japanese economy does not deteriorate further, to maintain jobs and boost Japan’s future growth potential, Mr Aso said.
The additional stimulus package comes as government figures showed unemployment rose to a three-year high of 4.4 per cent and the number of new jobs created sank to a 6-year low. Meanwhile, household spending fell 3.5 per cent year-on-year, a 12th consecutive monthly decline.
Japan’s Financial Services Agency is to inspect banks and credit associations to ensure they are extending loans to keep liquidity flowing to companies in need, Reuters reported on Tuesday.
Japan has already committed Y12,000bn in fiscal spending to revive the ailing economy and Mr Aso said the execution of those measures would be frontloaded as much as possible.
The prime minister failed to indicate how much more spending the new measures would entail, saying only that the cost of the package would depend on the details.
With the new package, Japan’s fiscal spending to combat the adverse effects of the global crisis, is likely to comfortably exceed the 2 per cent of GDP recommended by the IMF.
The new economic stimulus measures come as the Organisation for Economic Cooperation and Development warned that “the unemployment rate is likely to rise above 5.5 per cent and deflation may become entrenched.”
The OECD urged the Bank of Japan to keep the benchmark interest rate near zero and increase liquidity and recommended the Japanese government reform the tax system to promote growth.
The Nikkei stock average closed moderately lower amid concerns about the future outlook following nervousness in the US market over the fate of the car and banking industries.
Meanwhile, the ruling Liberal Democratic Party yesterday decided to submit legislation that would allow the use of public funds to buy exchange traded funds and real estate investment trusts, in a desperate bid to bolster Japan’s sagging markets.
Mr Aso said further that the government was considering measures to channel Japan’s Y1,400,000bn in household financial assets, much of which is held by the elderly, towards consumption.
The government is also working on a long-term growth programme that would bring the public and private sectors together to create new jobs and stimulate demand, Mr Aso said.
The programme will aim to stimulate growth by channelling Japan’s strength in environmental technology, animation, fashion and popular music to revenue-generating businesses.
Japan will also use its financial resources, including overseas development aid, to stimulate growth in Asia, Mr Aso said.
“It is important to look beyond Japan’s borders and think about Asian growth as a whole,” he said.
“I would like Japan to use its technology to lead a low-carbon revolution,” Mr Aso said.
OECD urges ECB to start quantitative easing/Eurozone inflation plunges to record low
OECD urges ECB to start quantitative easing
By Daniel Pimlott in London
Copyright The Financial Times Limited 2009
Published: March 31 2009 11:57 | Last updated: March 31 2009 11:57
http://www.ft.com/cms/s/0/18cdef6e-1dd7-11de-830b-00144feabdc0.html
The Organisation for Economic Co-operation and Development on Tuesday urged the European Central Bank to cut interest rates closer to zero and begin quantitative easing, as it forecast a deeper recession in Europe and Japan than in the US and UK.
The call to the ECB to begin creating money in order to head off deflation comes after the central bank has been less aggressive in cutting interest rates than its American and British counterparts.
While the Federal Reserve and the Bank of England have begun programmes of quantitative easing – increasing reserves in order to buy up government and corporate bonds – the ECB is still exploring expanding its range of monetary weapons to head off the recession.
The Paris-based thinktank warned in its quarterly forecasts for advanced economies that “the growing disinflationary pressures anticipated during the next two years” implied that the “remaining scope for cutting policy rates should be used quickly and quantitative easing policies implemented”.
Interest rates in the ECB currently stand at 1.5 per cent compared to 0.5 per cent in the UK and a range of between zero and 0.25 per cent in the US.
The call for further monetary stimulus in Europe came as the OECD forecast that advanced economies around the world will contract by 4.3 per cent in 2009 with little or no growth expected in 2010.
The whole world economy will shrink by 2.7 per cent this year, the OECD forecasts, before rebounding to a growth rate of 1.2 per cent next year.
“The downturn is the most severe and synchronised in post-war history,” the OECD said.
The call for further monetary stimulus in Europe came as the OECD predicted that one in 10 workers in advanced economies will be without a job next year. Other figures out on Tuesday showed that Japan and Germany have seen sharp increases in unemployment.
On Monday Angel Gurría, the head of the OECD, said that unemployment in the 30 advanced OECD countries would swell “by about 25m million people, by far the largest and most rapid increase in OECD unemployment in the postwar period”.
However, while the downturn will leave no advanced economies unscathed, the OECD is forecasting that it will be less severe in the US and UK, where banking systems have proved more fragile.
While the US is expected to suffer a 4 per cent decline in GDP this year, followed by no growth in 2010, the eurozone is set to contract by 4.1 per cent in 2009 and 0.3 per cent next year.
Within the eurozone, Germany is expected to see the worst recession, with a 5.3 per cent decline in GDP in 2009, with Italy suffering a drop of 4.3 per cent. By comparison the UK gets off relatively lightly with a 3.7 per cent drop in GDP in 2009 and a 0.2 per cent decline in 2010. Japan will suffer most of all with a 6.6 per cent decline this year and a further decline of 0.5 per cent next year.
The OECD appeared to call for further fiscal stimulus in Europe, a demand that is likely to strike a jarring note with Germany and others, who say they want to see the effects of stimulus packages already in place before embarking on another round of spending.
“Additional discretionary fiscal measures are also warranted in member countries that have sufficient budgetary scope,” the OECD said.
In the UK, the OECD warned that although further fiscal stimulus could be warranted if the recession gets much worse, there was not much scope for increased public spending or lower taxes due to the rapid deterioraiton in the public finances.
“The room for additional fiscal manoeuvre to respond to worse-than-expected activity developments is therefore limited and new measures would need to be accompanied by detailed and credible fiscal consolidation plans, in order to ensure that confidence is not eroded,” the report said. “In this regard, the formulation of a strong and credible medium-term fiscal framework would be helpful.”
The report shows world trade growth collapsed at a nearly 25 per cent annualised pace in the fourth quarter of last year, compared with an average of 8 per cent growth over the last 5 years. This was the sharpest contraction since records began in 1965.
Inflation would slow sharply across developed economies this year, with some experiencing prolonged periods of falling prices.
But it said that policy introduced so far would help the world avoid another Great Depression.
“The Great Depression was deepened by terrible policy mistakes, ranging from contractionary monetary policy to beggar-thy-neighbour policies in the form of trade protection and competitive devaluations,” the report said. “In contrast, this recession has broadly elicited the right policy.”
Eurozone inflation plunges to record low
By Ralph Atkins in Frankfurt
Copyright The Financial Times Limited 2009
Published: March 31 2009 11:31 | Last updated: March 31 2009 11:31
http://www.ft.com/cms/s/0/3d8c80ce-1dda-11de-830b-00144feabdc0.html
Eurozone inflation has fallen to a record low, strengthening the case for further European Central Bank action to boost the economy of the 16-country bloc and head off any risk of deflation.
The annual rate of eurozone price increases fell more than expected, from 1.2 per cent in February to just 0.6 per cent in March, according to an initial estimate on Tuesday by Eurostat, the European Union’s statistical unit.
That was the lowest since comparable records began in the early 1990s. Some economists calculated that it was the lowest seen in continental Europe for half a century. It also pointed to substantial undershooting of the ECB's target of an annual inflation rate "below but close" to 2 per cent.
Oil prices accounted for much of the fall but economists said the weakness of the eurozone economy almost certainly added significantly to the downward pressure on prices. Eurostat gave no details.
Spain earlier this week became the first eurozone country to report a negative annual inflation rate. The ECB is braced for the overall eurozone inflation rate to turn negative in coming months, and the unexpected weakness of the eurozone data could heighten fears that the region will enter a deflationary phase.
The ECB sees full-blown deflation – sustained and general falls in prices that wreak substantial economic damage – remaining a remote risk, largely because of rigidities in the eurozone economy.
Jean-Claude Trichet, ECB president, told the European Parliament on Monday that neither the ECB nor other international institutions considered the risk of eurozone deflation to be “elevated and substantiated”. But he added that “we have to remain permanently alert”.
The danger the ECB faces is that negative inflation rates fuel expectations about future trends in prices that become deflationary. A European Commission report this week showed that the rate of price increases expected by eurozone consumers for the next 12 months was the weakest since its survey began in 1985.
The ECB is widely expected to cut its main policy interest rate by a further half percentage point to 1 per cent at its meeting on Thursday. So far its “non-standard” actions to combat the recession have focused on so-called “enhanced credit support” – the ECB’s answer to quantitative easing – by which it is flooding the banking sector with unlimited amounts of liquidity at low interest rates.
But the ECB is activity considering further steps, including the possible purchase of private sector debt. “The ECB’s work will not be finished with the rate cut expected on Thursday,” said Rainer Guntermann, economist at Commerzbank in Frankfurt.
The Organisation for Economic Co-operation and Development on Tuesday urged the ECB to cut interest rates closer to zero and begin quantitative easing, as it forecast a deeper recession in Europe and Japan than in the US and UK.
The Paris-based think-tank warned in its quarterly forecasts for advanced economies that “the growing disinflationary pressures anticipated during the next two years” implied that the “remaining scope for cutting policy rates should be used quickly and quantitative easing policies implemented”.
Additional reporting by Daniel Pimlott
By Daniel Pimlott in London
Copyright The Financial Times Limited 2009
Published: March 31 2009 11:57 | Last updated: March 31 2009 11:57
http://www.ft.com/cms/s/0/18cdef6e-1dd7-11de-830b-00144feabdc0.html
The Organisation for Economic Co-operation and Development on Tuesday urged the European Central Bank to cut interest rates closer to zero and begin quantitative easing, as it forecast a deeper recession in Europe and Japan than in the US and UK.
The call to the ECB to begin creating money in order to head off deflation comes after the central bank has been less aggressive in cutting interest rates than its American and British counterparts.
While the Federal Reserve and the Bank of England have begun programmes of quantitative easing – increasing reserves in order to buy up government and corporate bonds – the ECB is still exploring expanding its range of monetary weapons to head off the recession.
The Paris-based thinktank warned in its quarterly forecasts for advanced economies that “the growing disinflationary pressures anticipated during the next two years” implied that the “remaining scope for cutting policy rates should be used quickly and quantitative easing policies implemented”.
Interest rates in the ECB currently stand at 1.5 per cent compared to 0.5 per cent in the UK and a range of between zero and 0.25 per cent in the US.
The call for further monetary stimulus in Europe came as the OECD forecast that advanced economies around the world will contract by 4.3 per cent in 2009 with little or no growth expected in 2010.
The whole world economy will shrink by 2.7 per cent this year, the OECD forecasts, before rebounding to a growth rate of 1.2 per cent next year.
“The downturn is the most severe and synchronised in post-war history,” the OECD said.
The call for further monetary stimulus in Europe came as the OECD predicted that one in 10 workers in advanced economies will be without a job next year. Other figures out on Tuesday showed that Japan and Germany have seen sharp increases in unemployment.
On Monday Angel Gurría, the head of the OECD, said that unemployment in the 30 advanced OECD countries would swell “by about 25m million people, by far the largest and most rapid increase in OECD unemployment in the postwar period”.
However, while the downturn will leave no advanced economies unscathed, the OECD is forecasting that it will be less severe in the US and UK, where banking systems have proved more fragile.
While the US is expected to suffer a 4 per cent decline in GDP this year, followed by no growth in 2010, the eurozone is set to contract by 4.1 per cent in 2009 and 0.3 per cent next year.
Within the eurozone, Germany is expected to see the worst recession, with a 5.3 per cent decline in GDP in 2009, with Italy suffering a drop of 4.3 per cent. By comparison the UK gets off relatively lightly with a 3.7 per cent drop in GDP in 2009 and a 0.2 per cent decline in 2010. Japan will suffer most of all with a 6.6 per cent decline this year and a further decline of 0.5 per cent next year.
The OECD appeared to call for further fiscal stimulus in Europe, a demand that is likely to strike a jarring note with Germany and others, who say they want to see the effects of stimulus packages already in place before embarking on another round of spending.
“Additional discretionary fiscal measures are also warranted in member countries that have sufficient budgetary scope,” the OECD said.
In the UK, the OECD warned that although further fiscal stimulus could be warranted if the recession gets much worse, there was not much scope for increased public spending or lower taxes due to the rapid deterioraiton in the public finances.
“The room for additional fiscal manoeuvre to respond to worse-than-expected activity developments is therefore limited and new measures would need to be accompanied by detailed and credible fiscal consolidation plans, in order to ensure that confidence is not eroded,” the report said. “In this regard, the formulation of a strong and credible medium-term fiscal framework would be helpful.”
The report shows world trade growth collapsed at a nearly 25 per cent annualised pace in the fourth quarter of last year, compared with an average of 8 per cent growth over the last 5 years. This was the sharpest contraction since records began in 1965.
Inflation would slow sharply across developed economies this year, with some experiencing prolonged periods of falling prices.
But it said that policy introduced so far would help the world avoid another Great Depression.
“The Great Depression was deepened by terrible policy mistakes, ranging from contractionary monetary policy to beggar-thy-neighbour policies in the form of trade protection and competitive devaluations,” the report said. “In contrast, this recession has broadly elicited the right policy.”
Eurozone inflation plunges to record low
By Ralph Atkins in Frankfurt
Copyright The Financial Times Limited 2009
Published: March 31 2009 11:31 | Last updated: March 31 2009 11:31
http://www.ft.com/cms/s/0/3d8c80ce-1dda-11de-830b-00144feabdc0.html
Eurozone inflation has fallen to a record low, strengthening the case for further European Central Bank action to boost the economy of the 16-country bloc and head off any risk of deflation.
The annual rate of eurozone price increases fell more than expected, from 1.2 per cent in February to just 0.6 per cent in March, according to an initial estimate on Tuesday by Eurostat, the European Union’s statistical unit.
That was the lowest since comparable records began in the early 1990s. Some economists calculated that it was the lowest seen in continental Europe for half a century. It also pointed to substantial undershooting of the ECB's target of an annual inflation rate "below but close" to 2 per cent.
Oil prices accounted for much of the fall but economists said the weakness of the eurozone economy almost certainly added significantly to the downward pressure on prices. Eurostat gave no details.
Spain earlier this week became the first eurozone country to report a negative annual inflation rate. The ECB is braced for the overall eurozone inflation rate to turn negative in coming months, and the unexpected weakness of the eurozone data could heighten fears that the region will enter a deflationary phase.
The ECB sees full-blown deflation – sustained and general falls in prices that wreak substantial economic damage – remaining a remote risk, largely because of rigidities in the eurozone economy.
Jean-Claude Trichet, ECB president, told the European Parliament on Monday that neither the ECB nor other international institutions considered the risk of eurozone deflation to be “elevated and substantiated”. But he added that “we have to remain permanently alert”.
The danger the ECB faces is that negative inflation rates fuel expectations about future trends in prices that become deflationary. A European Commission report this week showed that the rate of price increases expected by eurozone consumers for the next 12 months was the weakest since its survey began in 1985.
The ECB is widely expected to cut its main policy interest rate by a further half percentage point to 1 per cent at its meeting on Thursday. So far its “non-standard” actions to combat the recession have focused on so-called “enhanced credit support” – the ECB’s answer to quantitative easing – by which it is flooding the banking sector with unlimited amounts of liquidity at low interest rates.
But the ECB is activity considering further steps, including the possible purchase of private sector debt. “The ECB’s work will not be finished with the rate cut expected on Thursday,” said Rainer Guntermann, economist at Commerzbank in Frankfurt.
The Organisation for Economic Co-operation and Development on Tuesday urged the ECB to cut interest rates closer to zero and begin quantitative easing, as it forecast a deeper recession in Europe and Japan than in the US and UK.
The Paris-based think-tank warned in its quarterly forecasts for advanced economies that “the growing disinflationary pressures anticipated during the next two years” implied that the “remaining scope for cutting policy rates should be used quickly and quantitative easing policies implemented”.
Additional reporting by Daniel Pimlott
Monday, March 30, 2009
The debate over equality for same-sex and unmarried elderly couples
The debate over equality for same-sex and unmarried elderly couples
By JASON PIERCESON
Copyright by THE STATE JOURNAL-REGISTER (Springfield, IL)
Posted Mar 28, 2009 @ 12:03 AM
The debate over equality for same-sex and unmarried elderly couples continues in Illinois with the passage of the Religious Freedom Protection and Civil Union Act by the Illinois House’s Youth and Family Committee.
At the hearing, most of the testimony from opponents invoked religious objections to the legislation, even though the bill explicitly states that no church will be required to perform civil unions. On the positive side, it appears that opponents of rights and equal treatment under the law for sexual minorities no longer feel comfortable making public statements that are rooted in myths and stereotypes. Public opinion has clearly shifted against these extreme views, and groups like the American Psychological Association and the American Academy of Pediatrics have clearly stated that same-sex relationships are equivalent to opposite-sex relationships. In other words, the window of opportunity for the effective use of this extreme language in the public square is rapidly closing, if not already completely closed.
This has left opponents with two arguments. First, they argue that the law should be consistent with their version of theology. The only relationship that is “natural” is a heterosexual one, and the law should recognize nothing else.
The danger of a purely theological approach and applying this subjective assessment to what is “natural” to issues of civil rights is chillingly exemplified by a Virginia judge who stated in defense of laws that made interracial marriage illegal: “Almighty God created the races ... and he placed them on separate continents ... The fact that he separated the races shows that he did not intend for the races to mix.” This, of course, was not the theology of all religious Americans at the time, but it was a view favored by many, perhaps a majority.
Opponents insist that their theology ought to directly drive public policy in the state. While religious voices are certainly valuable in all public policy discussions, the public and lawmakers generally reject this direct link. Many religious individuals and groups want the law to further limit or ban reproductive choice, but a majority of the people and lawmakers disagree. Many religious individuals and groups want no recognition for same-sex couples and their families in the law. The majority of the people of the state disagree, and hopefully lawmakers will listen. Poll after poll reflects strong support for relationship equality through civil unions at the state and national levels. Only about a third of the residents of Illinois want no recognition of same-sex relationships. Of course, not all theological perspectives lead to opposition to civil unions. Nearly 150 clergy from around the state have voiced support for the proposed law.
The second argument of opponents is perhaps more serious: Civil unions will limit religious freedom, even though churches have the freedom to refuse to perform civil unions under the bill. In fact, one of the opponents who testified at the hearing referenced a photographer in New Mexico who was fined by the state’s human rights commission for refusing to photograph a same-sex commitment ceremony. The problem with this example is that New Mexico does not have a law recognizing same-sex relationships. However, the state does have a law prohibiting discrimination on the basis of sexual orientation, as does Illinois. The photographer was fined not under a civil union law but under the anti-discrimination law. In other words, the potential for diminishing religious freedom already exists under current state and federal laws.
This is not a new problem, and policy-makers have generally allowed exemptions for religious institutions under anti-discrimination frameworks, but this does not exist for individuals engaging in activities where religion is only tangentially related to a person’s role or profession. For instance, if the photographer were an anti-Semite, he or she is still obligated to offer photography services for Jewish clients under state and federal anti-discrimination laws and subject to penalties for violation of the law, even if the bias had its foundation in theology. In a society that values both freedom and equality, this will always be a source of tension in law and policy. If anything, the proposed law in Illinois errs on the side of protecting religious freedom.
No good arguments are left for opposing civil unions, only those that are purely theological, and the public clearly supports extending civil protections and responsibilities to the tens of thousands of same-sex and unmarried couples who need these protections in Illinois.
Jason Pierceson is assistant professor of political studies and legal studies at the University of Illinois at Springfield and is author of the book, “Courts, Liberalism, and Rights: Gay Law and Politics in the United States and Canada,” and is co-author of the forthcoming book, “Moral Argument, Religion, and Same-Sex Marriage: Advancing the Public Good.”
By JASON PIERCESON
Copyright by THE STATE JOURNAL-REGISTER (Springfield, IL)
Posted Mar 28, 2009 @ 12:03 AM
The debate over equality for same-sex and unmarried elderly couples continues in Illinois with the passage of the Religious Freedom Protection and Civil Union Act by the Illinois House’s Youth and Family Committee.
At the hearing, most of the testimony from opponents invoked religious objections to the legislation, even though the bill explicitly states that no church will be required to perform civil unions. On the positive side, it appears that opponents of rights and equal treatment under the law for sexual minorities no longer feel comfortable making public statements that are rooted in myths and stereotypes. Public opinion has clearly shifted against these extreme views, and groups like the American Psychological Association and the American Academy of Pediatrics have clearly stated that same-sex relationships are equivalent to opposite-sex relationships. In other words, the window of opportunity for the effective use of this extreme language in the public square is rapidly closing, if not already completely closed.
This has left opponents with two arguments. First, they argue that the law should be consistent with their version of theology. The only relationship that is “natural” is a heterosexual one, and the law should recognize nothing else.
The danger of a purely theological approach and applying this subjective assessment to what is “natural” to issues of civil rights is chillingly exemplified by a Virginia judge who stated in defense of laws that made interracial marriage illegal: “Almighty God created the races ... and he placed them on separate continents ... The fact that he separated the races shows that he did not intend for the races to mix.” This, of course, was not the theology of all religious Americans at the time, but it was a view favored by many, perhaps a majority.
Opponents insist that their theology ought to directly drive public policy in the state. While religious voices are certainly valuable in all public policy discussions, the public and lawmakers generally reject this direct link. Many religious individuals and groups want the law to further limit or ban reproductive choice, but a majority of the people and lawmakers disagree. Many religious individuals and groups want no recognition for same-sex couples and their families in the law. The majority of the people of the state disagree, and hopefully lawmakers will listen. Poll after poll reflects strong support for relationship equality through civil unions at the state and national levels. Only about a third of the residents of Illinois want no recognition of same-sex relationships. Of course, not all theological perspectives lead to opposition to civil unions. Nearly 150 clergy from around the state have voiced support for the proposed law.
The second argument of opponents is perhaps more serious: Civil unions will limit religious freedom, even though churches have the freedom to refuse to perform civil unions under the bill. In fact, one of the opponents who testified at the hearing referenced a photographer in New Mexico who was fined by the state’s human rights commission for refusing to photograph a same-sex commitment ceremony. The problem with this example is that New Mexico does not have a law recognizing same-sex relationships. However, the state does have a law prohibiting discrimination on the basis of sexual orientation, as does Illinois. The photographer was fined not under a civil union law but under the anti-discrimination law. In other words, the potential for diminishing religious freedom already exists under current state and federal laws.
This is not a new problem, and policy-makers have generally allowed exemptions for religious institutions under anti-discrimination frameworks, but this does not exist for individuals engaging in activities where religion is only tangentially related to a person’s role or profession. For instance, if the photographer were an anti-Semite, he or she is still obligated to offer photography services for Jewish clients under state and federal anti-discrimination laws and subject to penalties for violation of the law, even if the bias had its foundation in theology. In a society that values both freedom and equality, this will always be a source of tension in law and policy. If anything, the proposed law in Illinois errs on the side of protecting religious freedom.
No good arguments are left for opposing civil unions, only those that are purely theological, and the public clearly supports extending civil protections and responsibilities to the tens of thousands of same-sex and unmarried couples who need these protections in Illinois.
Jason Pierceson is assistant professor of political studies and legal studies at the University of Illinois at Springfield and is author of the book, “Courts, Liberalism, and Rights: Gay Law and Politics in the United States and Canada,” and is co-author of the forthcoming book, “Moral Argument, Religion, and Same-Sex Marriage: Advancing the Public Good.”
Gunmen Storm Police Training School in Pakistan
Gunmen Storm Police Training School in Pakistan
By WAQAR GILLANI, SABRINA TAVERNISE and SALMAN MASOOD
copyright by The New York Times
Published: March 30, 2009
http://www.nytimes.com/2009/03/31/world/asia/31pstan.html?_r=1&ref=global-home
MANAWAN, Pakistan — Elite police forces recaptured a police training school from more than a dozen well-armed gunmen after an eight-hour siege near Lahore on Monday, with reports of the death toll ranging from 10 to 34.
It was the second brazen terrorist attack in tense Punjab Province this year as the authorities confront a tangle of insurgency and political challenges. The fragility of Pakistan has become a priority for the Obama administration along with the war in neighboring Afghanistan.
Only weeks ago, in early March, a dozen gunmen in Lahore opened fire on a bus carrying the Sri Lankan cricket team and its police escort, killing six police officers and a driver. That assault in the center of the busy provincial capital, a city of nine million people, led to the suspension of international cricket tours to Pakistan, a severe blow to national pride.
On Monday afternoon, after hours of confused explosions and gunfire as security forces battled to retake control of the building, rescue workers began evacuating the wounded in ambulances.
A police commando involved in the operation said three of the gunmen blew themselves up as commandos closed in.
“We announced: Give yourself up,” said Arif Ali, 32, a member of an elite squad of 15 men. “But they chose to kill themselves.”
His team was at the academy at the start of the assault, and said the attackers lobbed at least 10 to 12 grenades. They were armed with light machine guns and pistols and wore the sleeveless padded vests that are commonly used by suicide bombers, he said.
After retaking the building, Pakistani security forces emerged onto its roof and black-clad commandos shouted in jubilation, firing into the air.
Announcing the end of the operation, the senior official at the Pakistani Ministry of Interior, Rehman Malik, said the attack was intended to destabilize Pakistan and illustrated how far "our enemies" had penetrated the country.
The identity of the attackers was not immediately known. Shahid Iqbal, a senior officer commanding some of the forces that retook the school, described the attackers as Afghans, but offered no evidence. He said gunbattles raged in stairwells as the security forces moved in. The attackers threw grenades from upper floors onto police armored vehicles below, he said, and he saw at least one attacker blow himself up.
“One man blasted himself right there,” he said, gesturing toward a window.
Tajamal Hussein, a 20-year-old recruit, said that the attackers spoke with the Saraiki accent of the southern Punjab region of Pakistan and that they shouted: “We have come, O attackers of the Red Mosque, we have come.” The reference was apparently to a bloody, eight-day siege of a militant mosque in Islamabad, in July, 2007, finally ended by the military.
The police academy appeared to have been chosen carefully, and the gunmen struck while hundreds of young recruits were on the parade ground.
The assault began at around 8 a.m. when the gunmen entered the building from a rear entrance, firing indiscriminately and throwing grenades at the parade ground where hundreds of new recruits were starting their morning drill. Adnan Ali had been on night duty with other cadets and was awoken to the sound of gunfire shattering the windows of a sleeping area with mattresses on the floor. Outside, he said in an interview, he saw recruits crawling to safety and joined them to hide under buses parked outside.
Soon afterward, television footage showed bodies of dead policemen littering the ground. Scores of recruits clambered over walls to escape, then crawled along the ground to seek shelter in nearby buildings.
“You can’t even imagine such a situation,” said Saqib Butt, deputy superintendent of Manawan police, as shots rang out behind him. “We were very surprised.”
One police commando said he had personally helped carry into ambulances the bodies of 32 dead police recruits who had been on the parade ground at the time of the assault.
The assault appeared to have been well-planned, an intelligence expert said. “This took many weeks to plan, someone should have smelled this was going to happen,” said Masood Sharif, the former chief of intelligence in Lahore.
Government troops outside the police training school in Lahore.
Scores of police vehicles and ambulances crowded around the high walls of the academy as police rushed to the compound. The attackers fired from the roof of the school as a police helicopter hovered overhead. Police sharpshooters positioned at nearby buildings fired into the compound.
A helicopter ferrying troops to the scene was hit by fire from the attackers, but managed to land safely, according to Dawn television.
A police officer who had been inside the compound, Mohammed Imtiaz Khaliq, said one of the attackers had a short beard and was dressed in traditional Pakistani dress and had said repeatedly in Urdu: “I’m a Muslim.”
The officer said he saw at least 30 people critically wounded after he entered the building through a kitchen area where dozens of police recruits and an instructor were cowering on a floor, some with blood on their clothing.
After the security forces completed their assault, police who entered the building said there were a number of dead bodies inside the compound. It was not immediately clear how high the death toll would climb, or at what stage of the operation people inside the building were killed.
A recruit who identified himself only as Rafique, 20, said he heard an intense blast at the beginning of the regular morning parade. "We ran out immediately. I didn’t come back till the end of the operation," he said, as he stood at the main entrance. The secretary of information for Punjab, Taimur Azmat Usman, said three men, including one carrying hand grenades, had been arrested on the perimeter of the compound on suspicion of helping the attackers inside the building.
There was immediate speculation that the assault may have been carried out by Lashkar-e-Jangvi, a sectarian group that recruits in southern Punjab but in recent years has moved to South and North Waziristan to train alongside Al Qaeda.
A cadet who was on the parade ground at the time of the attack said the gunmen entered the school at about 8 a.m. from the rear. The attackers immediately threw grenades and opened fire, said Amir Farook, 22. “Most of the recruits were present on the parade ground,” Mr. Farook said as he waited for treatment at a Lahore hospital. Contradicting some reports, he said the gunmen were not wearing police uniforms.
Another recruit, Mushammad Raza, 22, said he heard blasts and then saw the attackers throw hand grenades. With a dozen other recruits, he clambered over a wall and crawled across a road before taking shelter in a house for half an hour. Rescue workers then took him to a hospital.
Rizwan Naseer, a doctor in charge of emergency operations, said at least 48 people were being treated at hospitals. Local media cited 90 wounded and said there could be many more casualties. Former police officials told television reporters that security around the school was light, allowing the gunmen to breach the walls easily.
Wounded cadets were carried out of the center on stretchers and some who had escaped by jumping over walls were shown weeping in television footage. The school was believed to have 850 cadets under training. One of them, Khalil Zaman, said the attack had destroyed his ambition to be a police officer. “I will not join the police, not after this,” he said. “I love my life.”
Jane Perlez and Pir Zubair Shah contributed reporting from Islamabad.
By WAQAR GILLANI, SABRINA TAVERNISE and SALMAN MASOOD
copyright by The New York Times
Published: March 30, 2009
http://www.nytimes.com/2009/03/31/world/asia/31pstan.html?_r=1&ref=global-home
MANAWAN, Pakistan — Elite police forces recaptured a police training school from more than a dozen well-armed gunmen after an eight-hour siege near Lahore on Monday, with reports of the death toll ranging from 10 to 34.
It was the second brazen terrorist attack in tense Punjab Province this year as the authorities confront a tangle of insurgency and political challenges. The fragility of Pakistan has become a priority for the Obama administration along with the war in neighboring Afghanistan.
Only weeks ago, in early March, a dozen gunmen in Lahore opened fire on a bus carrying the Sri Lankan cricket team and its police escort, killing six police officers and a driver. That assault in the center of the busy provincial capital, a city of nine million people, led to the suspension of international cricket tours to Pakistan, a severe blow to national pride.
On Monday afternoon, after hours of confused explosions and gunfire as security forces battled to retake control of the building, rescue workers began evacuating the wounded in ambulances.
A police commando involved in the operation said three of the gunmen blew themselves up as commandos closed in.
“We announced: Give yourself up,” said Arif Ali, 32, a member of an elite squad of 15 men. “But they chose to kill themselves.”
His team was at the academy at the start of the assault, and said the attackers lobbed at least 10 to 12 grenades. They were armed with light machine guns and pistols and wore the sleeveless padded vests that are commonly used by suicide bombers, he said.
After retaking the building, Pakistani security forces emerged onto its roof and black-clad commandos shouted in jubilation, firing into the air.
Announcing the end of the operation, the senior official at the Pakistani Ministry of Interior, Rehman Malik, said the attack was intended to destabilize Pakistan and illustrated how far "our enemies" had penetrated the country.
The identity of the attackers was not immediately known. Shahid Iqbal, a senior officer commanding some of the forces that retook the school, described the attackers as Afghans, but offered no evidence. He said gunbattles raged in stairwells as the security forces moved in. The attackers threw grenades from upper floors onto police armored vehicles below, he said, and he saw at least one attacker blow himself up.
“One man blasted himself right there,” he said, gesturing toward a window.
Tajamal Hussein, a 20-year-old recruit, said that the attackers spoke with the Saraiki accent of the southern Punjab region of Pakistan and that they shouted: “We have come, O attackers of the Red Mosque, we have come.” The reference was apparently to a bloody, eight-day siege of a militant mosque in Islamabad, in July, 2007, finally ended by the military.
The police academy appeared to have been chosen carefully, and the gunmen struck while hundreds of young recruits were on the parade ground.
The assault began at around 8 a.m. when the gunmen entered the building from a rear entrance, firing indiscriminately and throwing grenades at the parade ground where hundreds of new recruits were starting their morning drill. Adnan Ali had been on night duty with other cadets and was awoken to the sound of gunfire shattering the windows of a sleeping area with mattresses on the floor. Outside, he said in an interview, he saw recruits crawling to safety and joined them to hide under buses parked outside.
Soon afterward, television footage showed bodies of dead policemen littering the ground. Scores of recruits clambered over walls to escape, then crawled along the ground to seek shelter in nearby buildings.
“You can’t even imagine such a situation,” said Saqib Butt, deputy superintendent of Manawan police, as shots rang out behind him. “We were very surprised.”
One police commando said he had personally helped carry into ambulances the bodies of 32 dead police recruits who had been on the parade ground at the time of the assault.
The assault appeared to have been well-planned, an intelligence expert said. “This took many weeks to plan, someone should have smelled this was going to happen,” said Masood Sharif, the former chief of intelligence in Lahore.
Government troops outside the police training school in Lahore.
Scores of police vehicles and ambulances crowded around the high walls of the academy as police rushed to the compound. The attackers fired from the roof of the school as a police helicopter hovered overhead. Police sharpshooters positioned at nearby buildings fired into the compound.
A helicopter ferrying troops to the scene was hit by fire from the attackers, but managed to land safely, according to Dawn television.
A police officer who had been inside the compound, Mohammed Imtiaz Khaliq, said one of the attackers had a short beard and was dressed in traditional Pakistani dress and had said repeatedly in Urdu: “I’m a Muslim.”
The officer said he saw at least 30 people critically wounded after he entered the building through a kitchen area where dozens of police recruits and an instructor were cowering on a floor, some with blood on their clothing.
After the security forces completed their assault, police who entered the building said there were a number of dead bodies inside the compound. It was not immediately clear how high the death toll would climb, or at what stage of the operation people inside the building were killed.
A recruit who identified himself only as Rafique, 20, said he heard an intense blast at the beginning of the regular morning parade. "We ran out immediately. I didn’t come back till the end of the operation," he said, as he stood at the main entrance. The secretary of information for Punjab, Taimur Azmat Usman, said three men, including one carrying hand grenades, had been arrested on the perimeter of the compound on suspicion of helping the attackers inside the building.
There was immediate speculation that the assault may have been carried out by Lashkar-e-Jangvi, a sectarian group that recruits in southern Punjab but in recent years has moved to South and North Waziristan to train alongside Al Qaeda.
A cadet who was on the parade ground at the time of the attack said the gunmen entered the school at about 8 a.m. from the rear. The attackers immediately threw grenades and opened fire, said Amir Farook, 22. “Most of the recruits were present on the parade ground,” Mr. Farook said as he waited for treatment at a Lahore hospital. Contradicting some reports, he said the gunmen were not wearing police uniforms.
Another recruit, Mushammad Raza, 22, said he heard blasts and then saw the attackers throw hand grenades. With a dozen other recruits, he clambered over a wall and crawled across a road before taking shelter in a house for half an hour. Rescue workers then took him to a hospital.
Rizwan Naseer, a doctor in charge of emergency operations, said at least 48 people were being treated at hospitals. Local media cited 90 wounded and said there could be many more casualties. Former police officials told television reporters that security around the school was light, allowing the gunmen to breach the walls easily.
Wounded cadets were carried out of the center on stretchers and some who had escaped by jumping over walls were shown weeping in television footage. The school was believed to have 850 cadets under training. One of them, Khalil Zaman, said the attack had destroyed his ambition to be a police officer. “I will not join the police, not after this,” he said. “I love my life.”
Jane Perlez and Pir Zubair Shah contributed reporting from Islamabad.
Fox News’s Mad, Apocalyptic, Tearful Rising Star
Fox News’s Mad, Apocalyptic, Tearful Rising Star
By BRIAN STELTER and BILL CARTER
Copyright by The New York Times
Published: March 29, 2009
http://www.nytimes.com/2009/03/30/business/media/30beck.html?th&emc=th
“You are not alone,” Glenn Beck likes to say. For the disaffected and aggrieved Americans of the Obama era, he could not have picked a better rallying cry.
Critics of Glenn Beck say he engages in incendiary rhetoric, but he says, “I’m a rodeo clown.”
Mr. Beck, an early-evening host on the Fox News Channel, is suddenly one of the most powerful media voices for the nation’s conservative populist anger. Barely two months into his job at Fox, his program is a phenomenon: it typically draws about 2.3 million viewers, more than any other cable news host except Bill O’Reilly or Sean Hannity, despite being on at 5 p.m., a slow shift for cable news.
With a mix of moral lessons, outrage and an apocalyptic view of the future, Mr. Beck, a longtime radio host who jumped to Fox from CNN’s Headline News channel this year, is capturing the feelings of an alienated class of Americans.
In an interview, Mr. Beck, who recently rewatched the 1976 film “Network,” said he identified with the character of Howard Beale, the unhinged TV news anchorman who declares on the air that he is “mad as hell.”
“I think that’s the way people feel,” Mr. Beck said. “That’s the way I feel.” In part because of Mr. Beck, Fox News — long identified as the favored channel for conservatives and Republican leaders — is enjoying a resurgence just two months into Mr. Obama’s term. While always top-rated among cable news channels, Fox’s ratings slipped during the long Democratic primary season last year. Now it is back on firm footing as the presumptive network of the opposition, with more than 1.2 million viewers watching at any given time, about twice as many as CNN or MSNBC.
While Mr. O’Reilly, the 8 p.m. host, paints himself as the outsider and Mr. Hannity, at 9, is more consistently ideological, Mr. Beck presents himself as a revivalist in a troubled land.
He preaches against politicians, hosts regular segments titled “Constitution Under Attack” and “Economic Apocalypse,” and occasionally breaks into tears.
Michael Smerconish, a fellow syndicated talk show host, said that Mr. Beck “has a gift for touching the passion nerve.”
Tapping into fear about the future, Mr. Beck also lingers over doomsday situations; in a series called “The War Room” last month he talked to experts about the possibility of global financial panic and widespread outbreaks of violence. He challenged viewers to “think the unthinkable” so that they would be prepared in case of emergency.
“The truth is — that you are the defender of liberty,” he said. “It’s not the government. It’s not an army or anybody else. It’s you. This is your country.”
And always, Mr. Beck’s emotions are never far from the surface. “That’s good dramatic television,” said Phil Griffin, the president of a Fox rival, MSNBC. “That’s who Glenn Beck is.”
Mr. Beck says he believes every word he says on his TV show, and the radio show that he still hosts from 9 a.m. to noon each weekday.
He says that America is “on the road to socialism” and that “God and religion are under attack in the U.S.” He recently wondered aloud whether FEMA was setting up concentration camps, calling it a rumor that he was unable to debunk.
At the same time, though, he says he is an entertainer. “I’m a rodeo clown,” he said in an interview, adding with a coy smile, “It takes great skill.”
And like a rodeo clown, Mr. Beck incites critics to attack by dancing in front of them.
“There are absolutely historical precedents for what is happening with Beck,” said Tom Rosenstiel, the director of the Project for Excellence in Journalism. “There was a lot of radio evangelism during the Depression. People were frustrated and frightened. There are a lot of scary parallels now.”
The conservative writer David Frum said Mr. Beck’s success “is a product of the collapse of conservatism as an organized political force, and the rise of conservatism as an alienated cultural sensibility.”
“It’s a show for people who feel they belong to an embattled minority that is disenfranchised and cut off,” he said.
Joel Cheatwood, a senior vice president for development at Fox News, said he thought Mr. Beck’s audience was a “somewhat disenfranchised” one. And, he added, “it’s a huge audience.”
Mr. Beck has used phrases like “we surround them,” invoked while speaking vaguely about people who do not share his discomfort with the “direction America is being taken in.”
His comments have prompted several bloggers to speculate recently that the TV host may have been promoting an armed revolt.
Jeffrey Jones, a professor of media and politics at Old Dominion University and author of the book “Entertaining Politics,” said that Mr. Beck engages in “inciting rhetoric. People hear their values are under attack and they get worried. It becomes an opportunity for them to stand up and do something.”
Sitting in his corner office overlooking Avenue of the Americas in Manhattan, Mr. Beck rejected such charges but acknowledged that some people see sinister meanings in his commentaries. He said the people “who are spreading the garbage that I’m stirring up a revolution haven’t watched the show.”
To answer his critics, Mr. Beck delivered a 17-minute commentary — remarkably long by cable standards — last Monday, answering criticisms, including one from Bill Maher that he was producing “the same kind of talking” that led Timothy McVeigh to blow up the Oklahoma City federal building in 1995.
“Let me be clear,” Mr. Beck said. “If someone tries to harm another person in the name of the Constitution or the ‘truth’ behind 9/11 or anything else, they are just as dangerous and crazy as those we don’t seem to recognize anymore, who kill in the name of Allah.”
Born in Mount Vernon, Wash., in 1964, Mr. Beck has long been a performer. His roots are in comedy — he spent years as a morning radio disc jockey — and continues to perform comedy on stages across the country.
He got into the radio business to “share my opinion in a humorous way,” but the times “are so serious now that I find myself sometimes being the guy I don’t want to be — the guy saying things that are sometimes pretty scary, but nobody else is willing to say them.”
In 2006, he joined Headline News. There, his show was taped, denying viewers some of the what-will-he-say-next quality of his live program on Fox.
On March 12 Mr. Beck introduced the 9/12 Project, an initiative to reclaim the values and principles that he said were evident the day after the Sept. 11, 2001, terrorist attacks. On a special broadcast he asked: “What ever happened to the country that loved the underdog and stood up for the little guy?”
When it was suggested in an interview that he sometimes sounds like a preacher, he responded, “No. You’ve never met a more flawed guy than me.”
He added later: “I say on the air all time, ‘if you take what I say as gospel, you’re an idiot.’ ”
By BRIAN STELTER and BILL CARTER
Copyright by The New York Times
Published: March 29, 2009
http://www.nytimes.com/2009/03/30/business/media/30beck.html?th&emc=th
“You are not alone,” Glenn Beck likes to say. For the disaffected and aggrieved Americans of the Obama era, he could not have picked a better rallying cry.
Critics of Glenn Beck say he engages in incendiary rhetoric, but he says, “I’m a rodeo clown.”
Mr. Beck, an early-evening host on the Fox News Channel, is suddenly one of the most powerful media voices for the nation’s conservative populist anger. Barely two months into his job at Fox, his program is a phenomenon: it typically draws about 2.3 million viewers, more than any other cable news host except Bill O’Reilly or Sean Hannity, despite being on at 5 p.m., a slow shift for cable news.
With a mix of moral lessons, outrage and an apocalyptic view of the future, Mr. Beck, a longtime radio host who jumped to Fox from CNN’s Headline News channel this year, is capturing the feelings of an alienated class of Americans.
In an interview, Mr. Beck, who recently rewatched the 1976 film “Network,” said he identified with the character of Howard Beale, the unhinged TV news anchorman who declares on the air that he is “mad as hell.”
“I think that’s the way people feel,” Mr. Beck said. “That’s the way I feel.” In part because of Mr. Beck, Fox News — long identified as the favored channel for conservatives and Republican leaders — is enjoying a resurgence just two months into Mr. Obama’s term. While always top-rated among cable news channels, Fox’s ratings slipped during the long Democratic primary season last year. Now it is back on firm footing as the presumptive network of the opposition, with more than 1.2 million viewers watching at any given time, about twice as many as CNN or MSNBC.
While Mr. O’Reilly, the 8 p.m. host, paints himself as the outsider and Mr. Hannity, at 9, is more consistently ideological, Mr. Beck presents himself as a revivalist in a troubled land.
He preaches against politicians, hosts regular segments titled “Constitution Under Attack” and “Economic Apocalypse,” and occasionally breaks into tears.
Michael Smerconish, a fellow syndicated talk show host, said that Mr. Beck “has a gift for touching the passion nerve.”
Tapping into fear about the future, Mr. Beck also lingers over doomsday situations; in a series called “The War Room” last month he talked to experts about the possibility of global financial panic and widespread outbreaks of violence. He challenged viewers to “think the unthinkable” so that they would be prepared in case of emergency.
“The truth is — that you are the defender of liberty,” he said. “It’s not the government. It’s not an army or anybody else. It’s you. This is your country.”
And always, Mr. Beck’s emotions are never far from the surface. “That’s good dramatic television,” said Phil Griffin, the president of a Fox rival, MSNBC. “That’s who Glenn Beck is.”
Mr. Beck says he believes every word he says on his TV show, and the radio show that he still hosts from 9 a.m. to noon each weekday.
He says that America is “on the road to socialism” and that “God and religion are under attack in the U.S.” He recently wondered aloud whether FEMA was setting up concentration camps, calling it a rumor that he was unable to debunk.
At the same time, though, he says he is an entertainer. “I’m a rodeo clown,” he said in an interview, adding with a coy smile, “It takes great skill.”
And like a rodeo clown, Mr. Beck incites critics to attack by dancing in front of them.
“There are absolutely historical precedents for what is happening with Beck,” said Tom Rosenstiel, the director of the Project for Excellence in Journalism. “There was a lot of radio evangelism during the Depression. People were frustrated and frightened. There are a lot of scary parallels now.”
The conservative writer David Frum said Mr. Beck’s success “is a product of the collapse of conservatism as an organized political force, and the rise of conservatism as an alienated cultural sensibility.”
“It’s a show for people who feel they belong to an embattled minority that is disenfranchised and cut off,” he said.
Joel Cheatwood, a senior vice president for development at Fox News, said he thought Mr. Beck’s audience was a “somewhat disenfranchised” one. And, he added, “it’s a huge audience.”
Mr. Beck has used phrases like “we surround them,” invoked while speaking vaguely about people who do not share his discomfort with the “direction America is being taken in.”
His comments have prompted several bloggers to speculate recently that the TV host may have been promoting an armed revolt.
Jeffrey Jones, a professor of media and politics at Old Dominion University and author of the book “Entertaining Politics,” said that Mr. Beck engages in “inciting rhetoric. People hear their values are under attack and they get worried. It becomes an opportunity for them to stand up and do something.”
Sitting in his corner office overlooking Avenue of the Americas in Manhattan, Mr. Beck rejected such charges but acknowledged that some people see sinister meanings in his commentaries. He said the people “who are spreading the garbage that I’m stirring up a revolution haven’t watched the show.”
To answer his critics, Mr. Beck delivered a 17-minute commentary — remarkably long by cable standards — last Monday, answering criticisms, including one from Bill Maher that he was producing “the same kind of talking” that led Timothy McVeigh to blow up the Oklahoma City federal building in 1995.
“Let me be clear,” Mr. Beck said. “If someone tries to harm another person in the name of the Constitution or the ‘truth’ behind 9/11 or anything else, they are just as dangerous and crazy as those we don’t seem to recognize anymore, who kill in the name of Allah.”
Born in Mount Vernon, Wash., in 1964, Mr. Beck has long been a performer. His roots are in comedy — he spent years as a morning radio disc jockey — and continues to perform comedy on stages across the country.
He got into the radio business to “share my opinion in a humorous way,” but the times “are so serious now that I find myself sometimes being the guy I don’t want to be — the guy saying things that are sometimes pretty scary, but nobody else is willing to say them.”
In 2006, he joined Headline News. There, his show was taped, denying viewers some of the what-will-he-say-next quality of his live program on Fox.
On March 12 Mr. Beck introduced the 9/12 Project, an initiative to reclaim the values and principles that he said were evident the day after the Sept. 11, 2001, terrorist attacks. On a special broadcast he asked: “What ever happened to the country that loved the underdog and stood up for the little guy?”
When it was suggested in an interview that he sometimes sounds like a preacher, he responded, “No. You’ve never met a more flawed guy than me.”
He added later: “I say on the air all time, ‘if you take what I say as gospel, you’re an idiot.’ ”
Banks Starting to Walk Away on Foreclosures
Banks Starting to Walk Away on Foreclosures
By SUSAN SAULNY
Copyright by The The New York Times
Published: March 29, 2009
http://www.nytimes.com/2009/03/30/us/30walkaway.html?th=&adxnnl=1&emc=th&adxnnlx=1238421719-IsqDrBouYfJr047SXKJ/Wg
SOUTH BEND, Ind. — Mercy James thought she had lost her rental property here to foreclosure. A date for a sheriff’s sale had been set, and notices about the foreclosure process were piling up in her mailbox.
After Ms. James had her tenants move out, vandals hit the home. It is set for demolition, but the title is still in her name.
Ms. James had the tenants move out, and soon her white house at the corner of Thomas and Maple Streets fell into the hands of looters and vandals, and then, into disrepair. Dejected and broke, Ms. James said she salvaged but a lesson from her loss.
So imagine her surprise when the City of South Bend contacted her recently, demanding that she resume maintenance on the property. The sheriff’s sale had been canceled at the last minute, leaving the property title — and a world of trouble — in her name.
“I thought, ‘What kind of game is this?’ ” Ms. James, 41, said while picking at trash at the house, now so worthless the city plans to demolish it — another bill for which she will be liable.
City officials and housing advocates here and in cities as varied as Buffalo, Kansas City, Mo., and Jacksonville, Fla., say they are seeing an unsettling development: Banks are quietly declining to take possession of properties at the end of the foreclosure process, most often because the cost of the ordeal — from legal fees to maintenance — exceeds the diminishing value of the real estate.
The so-called bank walkaways rarely mean relief for the property owners, caught unaware months after the fact, and often mean additional financial burdens and bureaucratic headaches. Technically, they still owe on the mortgage, but as a practicality, rarely would a mortgage holder receive any more payments on the loan. The way mortgages are bundled and resold, it can be enormously time-consuming just trying to determine what company holds the loan on a property thought to be in foreclosure.
In Ms. James’s case, the company that was most recently servicing her loan is now defunct. Its parent company filed for bankruptcy and dissolved. And the original bank that sold her the loan said it could not find a record of it.
“It is what some of us think is the next wave of the crisis,” said Kermit Lind, a clinical professor at the Cleveland-Marshall College of Law and an expert on foreclosure law.
For older industrial cities like South Bend, hard times in the mortgage market began before the recent national downturn, as did the problem of bank walkaways. In the case of Ms. James, a home health care administrator, the foreclosure proceedings began in the summer of 2007, when she could not keep up with the adjustable rate on her mortgage.
In Buffalo, where officials said the problem had reached “epidemic” proportions in recent months, the city sued 37 banks last year, claiming they were responsible for the deterioration of at least 57 abandoned homes; the city chose a sampling of houses to include in the lawsuit, even though the banks had walked away from many more foreclosures. So far, five banks have settled.
In Kansas City, Rachel Foley, a lawyer who handles housing cases, said bank walkaways were “a rare occurrence two to three years ago.”
“We’re seeing them dumped more and more at the moment,” she said.
Experts suggest the bank walkaways are most visible in states where foreclosures are processed through the courts and therefore tend to be more transparent. Other states, like Indiana and New York, have court-mandated foreclosures, but roughly half of the states allow foreclosures to proceed without court intervention, making it difficult to accurately count the number of bank walkaways in recent months.
The soft housing market and the vandalism that often occurs when a house sits empty are the two main factors influencing the mortgage holders’ decisions to walk away, said Larry Rothenberg, a lawyer for Weltman, Weinberg & Reis, one of the larger creditors’ rights firms in the country.
“Oftentimes when the foreclosure starts out, it’s a viable property,” Mr. Rothenberg said, “but by the time it gets to a sheriff’s sale, it might not have enough value to justify further expense. We’ve always had cases where property was vandalized or lost value, but they were rare compared to these times.”
The problem seems most acute at the bottom of the market — houses that were inexpensive to begin with — and with investment properties, where investors and banks want speedy closure by writing off bad loans as losses. Banks and investors typically lose 40 percent to 50 percent of their investment on every foreclosure.
Guy Cecala, publisher of Inside Mortgage Finance, an industry newsletter, said some properties had become such liabilities for investors that it was not even worth holding on to them to strip valuable fixtures, like kitchen appliances, toilets and hardware.
“The whole purpose of foreclosure is to take title of the property, sell it and recoup what money you can,” Mr. Cecala said. “It’s just a sign of the times that things are so bad no one wants to take possession of the property.”
In South Bend, boarded-up houses for whom no one has stepped forward are dotting the landscape, adding a fresh layer of blight to communities that were already scarred from the area’s industrial decline.
The city is hoping to create a new type of legal mediation process that would bring together the homeowners and the mortgage holders to settle their disputes while allowing the owners to remain in the home — considered crucial to any stabilization effort.
“I’d say in the last three or four months, we’ve seen dozens of these cases,” said Chuck Leone, the South Bend city attorney. “We see it one of two ways. One is that the bank will simply dismiss the foreclosure complaint. The other is that the mortgage holder will follow through and take a judgment of foreclosure, but then not schedule the property for sheriff’s sale.”
In Ms. James’s case, it has been impossible to determine who canceled the sheriff’s sale, since her last mortgage holder went out of business. Even the city clerk’s records did not provide an answer.
“Nobody has any idea who owns what or who’s responsible,” said Judy Fox, Ms. James’s lawyer at the Notre Dame Legal Aid Clinic. “It’s a very common story.”
Mayor Stephen J. Luecke of South Bend added: “It’s just a crime the way it puts people in limbo. They first off have gone through the grief of losing their house, then they move out and find out that they still own it and have responsibility for it.”
In Jacksonville, Fla., Sylvester Kimbrough Jr. found himself caught in the limbo between foreclosure and ownership last year, 10 years into his 30-year mortgage on a $42,000 two-bedroom house.
Mr. Kimbrough, 56, a former driver for a car dealership who is now unemployed, had already moved out when he learned that the foreclosure had been stopped.
“That move really almost destroyed us,” Mr. Kimbrough said. “It was all for nothing.”
By SUSAN SAULNY
Copyright by The The New York Times
Published: March 29, 2009
http://www.nytimes.com/2009/03/30/us/30walkaway.html?th=&adxnnl=1&emc=th&adxnnlx=1238421719-IsqDrBouYfJr047SXKJ/Wg
SOUTH BEND, Ind. — Mercy James thought she had lost her rental property here to foreclosure. A date for a sheriff’s sale had been set, and notices about the foreclosure process were piling up in her mailbox.
After Ms. James had her tenants move out, vandals hit the home. It is set for demolition, but the title is still in her name.
Ms. James had the tenants move out, and soon her white house at the corner of Thomas and Maple Streets fell into the hands of looters and vandals, and then, into disrepair. Dejected and broke, Ms. James said she salvaged but a lesson from her loss.
So imagine her surprise when the City of South Bend contacted her recently, demanding that she resume maintenance on the property. The sheriff’s sale had been canceled at the last minute, leaving the property title — and a world of trouble — in her name.
“I thought, ‘What kind of game is this?’ ” Ms. James, 41, said while picking at trash at the house, now so worthless the city plans to demolish it — another bill for which she will be liable.
City officials and housing advocates here and in cities as varied as Buffalo, Kansas City, Mo., and Jacksonville, Fla., say they are seeing an unsettling development: Banks are quietly declining to take possession of properties at the end of the foreclosure process, most often because the cost of the ordeal — from legal fees to maintenance — exceeds the diminishing value of the real estate.
The so-called bank walkaways rarely mean relief for the property owners, caught unaware months after the fact, and often mean additional financial burdens and bureaucratic headaches. Technically, they still owe on the mortgage, but as a practicality, rarely would a mortgage holder receive any more payments on the loan. The way mortgages are bundled and resold, it can be enormously time-consuming just trying to determine what company holds the loan on a property thought to be in foreclosure.
In Ms. James’s case, the company that was most recently servicing her loan is now defunct. Its parent company filed for bankruptcy and dissolved. And the original bank that sold her the loan said it could not find a record of it.
“It is what some of us think is the next wave of the crisis,” said Kermit Lind, a clinical professor at the Cleveland-Marshall College of Law and an expert on foreclosure law.
For older industrial cities like South Bend, hard times in the mortgage market began before the recent national downturn, as did the problem of bank walkaways. In the case of Ms. James, a home health care administrator, the foreclosure proceedings began in the summer of 2007, when she could not keep up with the adjustable rate on her mortgage.
In Buffalo, where officials said the problem had reached “epidemic” proportions in recent months, the city sued 37 banks last year, claiming they were responsible for the deterioration of at least 57 abandoned homes; the city chose a sampling of houses to include in the lawsuit, even though the banks had walked away from many more foreclosures. So far, five banks have settled.
In Kansas City, Rachel Foley, a lawyer who handles housing cases, said bank walkaways were “a rare occurrence two to three years ago.”
“We’re seeing them dumped more and more at the moment,” she said.
Experts suggest the bank walkaways are most visible in states where foreclosures are processed through the courts and therefore tend to be more transparent. Other states, like Indiana and New York, have court-mandated foreclosures, but roughly half of the states allow foreclosures to proceed without court intervention, making it difficult to accurately count the number of bank walkaways in recent months.
The soft housing market and the vandalism that often occurs when a house sits empty are the two main factors influencing the mortgage holders’ decisions to walk away, said Larry Rothenberg, a lawyer for Weltman, Weinberg & Reis, one of the larger creditors’ rights firms in the country.
“Oftentimes when the foreclosure starts out, it’s a viable property,” Mr. Rothenberg said, “but by the time it gets to a sheriff’s sale, it might not have enough value to justify further expense. We’ve always had cases where property was vandalized or lost value, but they were rare compared to these times.”
The problem seems most acute at the bottom of the market — houses that were inexpensive to begin with — and with investment properties, where investors and banks want speedy closure by writing off bad loans as losses. Banks and investors typically lose 40 percent to 50 percent of their investment on every foreclosure.
Guy Cecala, publisher of Inside Mortgage Finance, an industry newsletter, said some properties had become such liabilities for investors that it was not even worth holding on to them to strip valuable fixtures, like kitchen appliances, toilets and hardware.
“The whole purpose of foreclosure is to take title of the property, sell it and recoup what money you can,” Mr. Cecala said. “It’s just a sign of the times that things are so bad no one wants to take possession of the property.”
In South Bend, boarded-up houses for whom no one has stepped forward are dotting the landscape, adding a fresh layer of blight to communities that were already scarred from the area’s industrial decline.
The city is hoping to create a new type of legal mediation process that would bring together the homeowners and the mortgage holders to settle their disputes while allowing the owners to remain in the home — considered crucial to any stabilization effort.
“I’d say in the last three or four months, we’ve seen dozens of these cases,” said Chuck Leone, the South Bend city attorney. “We see it one of two ways. One is that the bank will simply dismiss the foreclosure complaint. The other is that the mortgage holder will follow through and take a judgment of foreclosure, but then not schedule the property for sheriff’s sale.”
In Ms. James’s case, it has been impossible to determine who canceled the sheriff’s sale, since her last mortgage holder went out of business. Even the city clerk’s records did not provide an answer.
“Nobody has any idea who owns what or who’s responsible,” said Judy Fox, Ms. James’s lawyer at the Notre Dame Legal Aid Clinic. “It’s a very common story.”
Mayor Stephen J. Luecke of South Bend added: “It’s just a crime the way it puts people in limbo. They first off have gone through the grief of losing their house, then they move out and find out that they still own it and have responsibility for it.”
In Jacksonville, Fla., Sylvester Kimbrough Jr. found himself caught in the limbo between foreclosure and ownership last year, 10 years into his 30-year mortgage on a $42,000 two-bedroom house.
Mr. Kimbrough, 56, a former driver for a car dealership who is now unemployed, had already moved out when he learned that the foreclosure had been stopped.
“That move really almost destroyed us,” Mr. Kimbrough said. “It was all for nothing.”
Rising Powers Challenge U.S. on Role in I.M.F.
Rising Powers Challenge U.S. on Role in I.M.F.
By MARK LANDLER
Copyright by The New York Times
Published: March 29, 2009
http://www.nytimes.com/2009/03/30/world/30fund.html?_r=1&th&emc=th
WASHINGTON — Barely six months ago, the International Monetary Fund emerged from years of declining relevance, hurriedly cobbling together emergency loans for countries from Iceland to Pakistan, as the first wave of the financial crisis hit.
Now, with world leaders gathering this week in London to plot a response to the gravest global economic downturn since World War II, the fund is becoming a chip in a contest to reshape the postcrisis landscape.
The Obama administration has made fortifying the I.M.F. one of its primary goals for the meeting of the Group of 20, which includes leading industrial and developing countries and the European Union. But China, India and other rising powers seem to believe that the made-in-America crisis has curtailed the ability of the United States to set the agenda. They view the Western-dominated fund as a place to begin staking their claim to a greater voice in global economic affairs.
Treasury Secretary Timothy F. Geithner, who once worked at the fund, has called for its financial resources to be expanded by $500 billion, effectively tripling its lending capacity to distressed countries and cementing its status as the lender of last resort for much of the world.
Japan and the European Union have each pledged $100 billion; the United States has signaled it will contribute a similar sum, though its money will take longer to arrive because of the need for Congressional approval. China, with its mammoth foreign exchange reserves, is the next obvious donor.
Yet officials of China and other developing countries have served notice that they are reluctant to make comparable pledges without getting a greater say in the operations of the fund, which is run by a Frenchman, Dominique Strauss-Kahn, and is heavily influenced by the United States and Western Europe.
A senior Chinese leader, Wang Qishan, said Friday that Beijing was willing to kick in some money, but he called for an overhaul of the way the fund is governed. China wants its quota — which determines its financial contribution and voting power — adjusted to reflect its economic weight better.
China’s contribution, Mr. Wang said, should not be based on the size of its reserves but on its economic output per person, which is still modest. Some American officials now expect a pledge on the order of $50 billion from China.
“Their arms may yet be twisted, but they simply do not want to pony up based on vague promises of governance reform,” said Eswar S. Prasad, a professor of economics at Cornell University who has discussed the matter in recent days with Chinese and Indian officials.
Given the inevitability that these countries will have a growing influence, the London summit meeting, which begins Thursday, is likely to be remembered “as the last hurrah for the U.S. and Europe rescuing the world economy,” said Simon Johnson, a professor at M.I.T. and a former chief economist of the fund.
One reason the I.M.F. has emerged as such a popular cause is that the United States has been unable to rally countries behind its other major priority: economic stimulus. The European Union opposes further stimulus packages in 2010, arguing that its social safety net makes an increase in government spending unnecessary.
European and American officials are also still divided, to a lesser degree, on how to rewrite international financial regulations. France and Germany are more receptive than the United States to giving regulators supranational authority to scrutinize global banks and other financial companies.
“The United States is desperately trying to assert leadership, as if it were 10 years ago, when the U.S. set the agenda,” said Kenneth S. Rogoff, an economist at Harvard and another former chief economist of the fund.
With more countries slipping into crisis by the week, there is general agreement that the fund needs additional resources. Since last year, the I.M.F. has made nearly $50 billion in loans to 13 countries. It is streamlining the process for making loans and loosening its strings, hoping to counter the resentment that built up against it during past crises because of its stringent demands.
At a preparatory meeting two weeks ago, finance ministers of the Group of 20 agreed to “very substantially” increase financing, though the Europeans favored an extra $250 billion, not $500 billion.
Whatever their reservations about financing, the Chinese have seized on the fund for another purpose: to tweak the United States. The governor of China’s central bank, Zhou Xiaochuan, recently proposed that the American dollar be phased out as the world’s default reserve currency. As a replacement, he suggested using special drawing rights, or S.D.R.’s, the synthetic currency created by the fund that is used for transactions between it and its 185 member countries.
Few economists view that idea as a realistic one, at least for years to come. But the mere assertion that the dollar’s pre-eminence is waning — a theme picked up by Russian officials as well — sends a message.
“I don’t think the Chinese or Russians really believe the S.D.R. is a viable currency,” said Mr. Prasad, the Cornell economist. “But they’re laying down a very clear marker that they’re going to be much more assertive about their role.”
Mr. Geithner took the remarks seriously enough that he publicly reaffirmed the primacy of the dollar.
The United States will address China’s status this week, when it announces details of a new high-level strategic and economic dialogue with Beijing, led by Mr. Geithner and Secretary of State Hillary Rodham Clinton, according to a senior administration official, who spoke anonymously because the information was not yet public. The announcement will come after the first meeting between President Obama and the Chinese president, Hu Jintao, in London.
The Obama administration has personal reasons to support the fund. Mr. Geithner was the I.M.F. director of policy planning from 2001 to 2003, after his first stint in the Treasury Department. He recruited Edwin M. Truman, another former Treasury official and a longtime advocate of the fund, as a temporary adviser to develop policies for the Group of 20 meeting.
Just before leaving his academic position at the Peterson Institute for International Economics, Mr. Truman proposed that the fund issue $250 billion in S.D.R.’s on a one-time basis to be allocated to all its members, as another way of increasing its resources. Western European countries, he said, could use their S.D.R.’s to lend money to their troubled Eastern neighbors.
That proposal is in a current draft of the statement to be issued at the Group of 20 meeting. If all the American proposals for the fund are adopted, its resources will approach $1 trillion — a big number, even in these extraordinary times.
Yet for Mr. Johnson of M.I.T., it merely shows how difficult it is for the United States to marshal support for anything else.
“They can’t agree on fiscal policy; they can’t agree on regulations,” he said. “The only thing left is the I.M.F.”
By MARK LANDLER
Copyright by The New York Times
Published: March 29, 2009
http://www.nytimes.com/2009/03/30/world/30fund.html?_r=1&th&emc=th
WASHINGTON — Barely six months ago, the International Monetary Fund emerged from years of declining relevance, hurriedly cobbling together emergency loans for countries from Iceland to Pakistan, as the first wave of the financial crisis hit.
Now, with world leaders gathering this week in London to plot a response to the gravest global economic downturn since World War II, the fund is becoming a chip in a contest to reshape the postcrisis landscape.
The Obama administration has made fortifying the I.M.F. one of its primary goals for the meeting of the Group of 20, which includes leading industrial and developing countries and the European Union. But China, India and other rising powers seem to believe that the made-in-America crisis has curtailed the ability of the United States to set the agenda. They view the Western-dominated fund as a place to begin staking their claim to a greater voice in global economic affairs.
Treasury Secretary Timothy F. Geithner, who once worked at the fund, has called for its financial resources to be expanded by $500 billion, effectively tripling its lending capacity to distressed countries and cementing its status as the lender of last resort for much of the world.
Japan and the European Union have each pledged $100 billion; the United States has signaled it will contribute a similar sum, though its money will take longer to arrive because of the need for Congressional approval. China, with its mammoth foreign exchange reserves, is the next obvious donor.
Yet officials of China and other developing countries have served notice that they are reluctant to make comparable pledges without getting a greater say in the operations of the fund, which is run by a Frenchman, Dominique Strauss-Kahn, and is heavily influenced by the United States and Western Europe.
A senior Chinese leader, Wang Qishan, said Friday that Beijing was willing to kick in some money, but he called for an overhaul of the way the fund is governed. China wants its quota — which determines its financial contribution and voting power — adjusted to reflect its economic weight better.
China’s contribution, Mr. Wang said, should not be based on the size of its reserves but on its economic output per person, which is still modest. Some American officials now expect a pledge on the order of $50 billion from China.
“Their arms may yet be twisted, but they simply do not want to pony up based on vague promises of governance reform,” said Eswar S. Prasad, a professor of economics at Cornell University who has discussed the matter in recent days with Chinese and Indian officials.
Given the inevitability that these countries will have a growing influence, the London summit meeting, which begins Thursday, is likely to be remembered “as the last hurrah for the U.S. and Europe rescuing the world economy,” said Simon Johnson, a professor at M.I.T. and a former chief economist of the fund.
One reason the I.M.F. has emerged as such a popular cause is that the United States has been unable to rally countries behind its other major priority: economic stimulus. The European Union opposes further stimulus packages in 2010, arguing that its social safety net makes an increase in government spending unnecessary.
European and American officials are also still divided, to a lesser degree, on how to rewrite international financial regulations. France and Germany are more receptive than the United States to giving regulators supranational authority to scrutinize global banks and other financial companies.
“The United States is desperately trying to assert leadership, as if it were 10 years ago, when the U.S. set the agenda,” said Kenneth S. Rogoff, an economist at Harvard and another former chief economist of the fund.
With more countries slipping into crisis by the week, there is general agreement that the fund needs additional resources. Since last year, the I.M.F. has made nearly $50 billion in loans to 13 countries. It is streamlining the process for making loans and loosening its strings, hoping to counter the resentment that built up against it during past crises because of its stringent demands.
At a preparatory meeting two weeks ago, finance ministers of the Group of 20 agreed to “very substantially” increase financing, though the Europeans favored an extra $250 billion, not $500 billion.
Whatever their reservations about financing, the Chinese have seized on the fund for another purpose: to tweak the United States. The governor of China’s central bank, Zhou Xiaochuan, recently proposed that the American dollar be phased out as the world’s default reserve currency. As a replacement, he suggested using special drawing rights, or S.D.R.’s, the synthetic currency created by the fund that is used for transactions between it and its 185 member countries.
Few economists view that idea as a realistic one, at least for years to come. But the mere assertion that the dollar’s pre-eminence is waning — a theme picked up by Russian officials as well — sends a message.
“I don’t think the Chinese or Russians really believe the S.D.R. is a viable currency,” said Mr. Prasad, the Cornell economist. “But they’re laying down a very clear marker that they’re going to be much more assertive about their role.”
Mr. Geithner took the remarks seriously enough that he publicly reaffirmed the primacy of the dollar.
The United States will address China’s status this week, when it announces details of a new high-level strategic and economic dialogue with Beijing, led by Mr. Geithner and Secretary of State Hillary Rodham Clinton, according to a senior administration official, who spoke anonymously because the information was not yet public. The announcement will come after the first meeting between President Obama and the Chinese president, Hu Jintao, in London.
The Obama administration has personal reasons to support the fund. Mr. Geithner was the I.M.F. director of policy planning from 2001 to 2003, after his first stint in the Treasury Department. He recruited Edwin M. Truman, another former Treasury official and a longtime advocate of the fund, as a temporary adviser to develop policies for the Group of 20 meeting.
Just before leaving his academic position at the Peterson Institute for International Economics, Mr. Truman proposed that the fund issue $250 billion in S.D.R.’s on a one-time basis to be allocated to all its members, as another way of increasing its resources. Western European countries, he said, could use their S.D.R.’s to lend money to their troubled Eastern neighbors.
That proposal is in a current draft of the statement to be issued at the Group of 20 meeting. If all the American proposals for the fund are adopted, its resources will approach $1 trillion — a big number, even in these extraordinary times.
Yet for Mr. Johnson of M.I.T., it merely shows how difficult it is for the United States to marshal support for anything else.
“They can’t agree on fiscal policy; they can’t agree on regulations,” he said. “The only thing left is the I.M.F.”
A fine balance for Obama to strike/‘Robust and stable’ system is goal of US
A fine balance for Obama to strike
By Edward Luce, Lionel Barber and Chrystia Freeland
Copyright The Financial Times Limited 2009
Published: March 30 2009 00:30 | Last updated: March 30 2009 00:30
http://www.ft.com/cms/s/0/74ab7ed2-1c8d-11de-977c-00144feabdc0.html
American presidents sometimes give interviews in the Oval Office. On this occasion Barack Obama chooses the nearby Roosevelt room, named after Teddy Roosevelt and his distant relative Franklin Delano Roosevelt, the last American president to be faced with a global economic crisis of this magnitude.
Then, like now, the president inherited a world economic summit in London that was scheduled just a few weeks after he took up residence in the White House (FDR came to office in March 1933, the summit was in April). Fatefully, Roosevelt chose not to attend.
Then, like now, the politics of domestic economic collapse crowded out much time for the rest of the world. Yet this time the crisis is even more global. Mr Obama also inherits an April crisis summit in London, the meeting this Thursday of the leaders of the group of 20 industrialised and developing nations.
Mindful, perhaps, that posterity blames FDR’s absence as the chief reason the 1933 summit failed to arrest global depression, Mr Obama emphasises the need for G20 leaders to be singing from the same song sheet: “The most important task for all of us is to deliver a strong message of unity in the face of crisis,” he says.
But his biggest challenges are probably at home. Dressed in a dark suit and a tie in the ruby-red he often favours, Mr Obama discloses that he reads global newspapers – an option not available to FDR: “I read the Financial Times before other people read the Financial Times [in Chicago in the 1980s],” the president says. “Now it’s trendy and everybody carries around a Financial Times.”
Seated opposite an imposing portrait of FDR and flanked by the famous “Rough Rider” portrait of Theodore Roosevelt, Mr Obama betrays few signs – other than a hint of fatigue – that the economic and political maelstrom around him has induced personal stress. Speaking without notes, props or assistance from aides, the president answers in the professorial “no drama Obama” manner which helped persuade America’s voters last November he had a better temperament than John McCain to cope with this multiplicity of emergencies.
These are immediate and tangible. Just 66 days into his new job, Mr Obama enters the interview having just unveiled a new strategic policy on Afghanistan and Pakistan, including sending another 4,000 American troops into the field on top of the 17,000 he announced last month.
Earlier he had also hosted a meeting with a group of Wall Street executives, including Lloyd Blankfein of Goldman Sachs and Jamie Dimon of JPMorgan Chase, who seemed grateful simply to be invited rather than pilloried by legislators on Capitol Hill.
Mr Obama speaks of the Wall Street executives with disapproval rather than resentment, in a clear moderation of some of the rhetoric he was employing until recently. “It was a constructive conversation,” he says. “But one of the points that I made is that at a time when everybody is needing to sacrifice there has to be a similar sense of sacrifice on the part of those various sectors of the economy that helped to precipitate this crisis.”
Shortly after his election, Mr Obama promised to “hit the ground running”. Even the highly ambitious president-elect could not have anticipated just how much running that would entail. Or how many opportunities there would be to trip up, one or two of which he has taken, such as the succession of nominees for senior posts who had to withdraw.
Following the failure of the first attempt last month by Tim Geithner, Treasury secretary, to announce guidelines for the removal of toxic assets from bank balance sheets, critics fear that Mr Obama still lacks a full strategy to revitalise the financial system.
Last week Mr Geithner unveiled the latest initiative to deal with toxic assets. The plan was attacked by some as insufficiently radical, but the president points to the stock market rally that followed. “Tim Geithner’s efforts to provide a market for asset-backed securities has helped [but] we still have a long way to go,” he says.
The president is also in the midst of increasingly tense negotiations with Capitol Hill over the White House’s breathtakingly ambitious $3,600bn (€2,700bn, £2,518bn) budget – incorporating the biggest pledges, notably universal healthcare and a cap-and-trade system for carbon emissions, on which Mr Obama campaigned before the economy started collapsing.
His budget could yet unravel amid outrage over the kind of double digit fiscal deficits last seen in the second world war when FDR was in the closing stages of his life. Then there is the small matter of managing a drawdown of US combat troops in Iraq, their redeployment to Afghanistan – the “graveyard of empires” – a continued global terrorist threat and, closer to home, the possibility of neighbouring Mexico being torn apart by a drugs war.
Much like FDR, who believed presidents should try everything, junk whatever fails and move swiftly on, Mr Obama conveys a pragmatic approach to the economic emergency, suggesting it is still a work-in-progress.
Nor, perhaps, can Mr Obama have anticipated the degree of high-wire balancing that is required of him – between the demands of increasingly populist politics and the need to take steps that will dig America and the world out of the economic crisis as quickly as possible.
Here the president faces an Everest. He concedes there is a gulf between what is politically possible and what may prove to be economically necessary. Ten days ago the House of Representatives voted to impose a 90 per cent tax retroactively on bonuses for those earning more than $125,000 who work at taxpayer-aided firms – the same firms who may now be deterred from participating in future government rescues.
The final version is likely to be diluted in the Senate next month. “That is one gap,” says Mr Obama. “Then there is a gap in ideas about how to approach a crisis like this, especially among economists – although on the issue of the stimulus there seems to be a much broader consensus [Mr Obama signed a $787bn two-year stimulus bill into law last month].”
He admits there is much less unity on how to repair the financial sector. Some, including liberal critics such as the Nobel-prize winning economists Paul Krugman and Joseph Stiglitz, argue for all-out bank nationalisation. Conservatives, meanwhile, believe the White House bail-out plan is the road to socialism.
Where consensus does reign is in the outrage felt across the political spectrum over the bonuses that recipients of US taxpayer largesse, such as AIG and Citigroup, have been awarding senior employees. There is also the balancing act of pumping lots of new spending into the economy while reassuring Treasury bond investors, particularly the Chinese, that the US remains committed to medium-term fiscal discipline. “In all countries there is an understandable tension between the steps that are needed to kick-start the economy and the fact that many of these steps are very expensive,” says Mr Obama.
This also requires balancing. The president is trying to share the public’s outrage over Wall Street’s runaway culture of over-remuneration without alienating the financiers whose co-operation would be integral to the success of his bail-out plans.
The admonition is calibrated. “To the extent that they [the Wall Street bosses] are showing restraint that compensation packages are structured so that there is some deferral until money is returned to taxpayers, that will be good for everybody,” he says. “That will put me in a stronger position to help them.”
Mr Obama has tried, with limited success, to persuade the US public that what is good for Wall Street is good for Main Street. Until bankers show serious restraint, it will be hard for him to return to Capitol Hill to ask for the hundreds of billions more that most economists believe will be needed to recapitalise the US banking sector. There is a limit to public largesse.
“If voters perceive that it is a one-way street, that we are just pouring more and more money into institutions and seeing no return other than avoiding catastrophe, then it is harder to make an argument for further intervention,” he says.
Moreover, the steps the White House has taken since Inauguration Day will take time to show results, assuming, that is, they ever do. The president believes they already are. He cites “glimmers of stabilisation” in the US property market, where housing starts recently rose, and in the markets for cars and student loans.
Only a handful of economists forecast a return to strong growth next year. Some fear that a contraction of between 3 and 6 per cent in gross domestic product this year could be followed by more of the same in 2010. “What is also difficult is the fact that the policies we initiate all take time to take effect and by its very nature politics looks for more instantaneous gratification,” the president says.
Then there is the international balancing act. Mr Obama wants to unite America’s potentially fractious partners behind a co-ordinated stimulus and new financial regulation in London this week while also arresting the threat of protectionism. Unlike FDR, Mr Obama does not inherit the Smoot-Hawley Act, which erected steep trade barriers that entrenched the Great Depression and helped pave the way to world war two.
However, the US and its partners broke their promise at the first G20 summit last November to restart the Doha round of world trade talks. According to the World Bank, which has accumulated 73 examples of protectionist measures since then, many countries are moving in the opposite direction.
The president is understanding towards his partners, not least perhaps because he recently signed into law “Buy American” clauses that discriminate against foreign suppliers. While pointing out the “Buy American” provisions are consistent with World Trade Organisation rules, he observes: “I think in a democracy there are always going to be some loose ends out there. That is true here and true around the world but overall I don’t think that we have seen a huge rush to protectionism,” he adds. “To the extent that the American people [and others] feel confident their leaders are doing everything they can to encourage and promote economic growth, I think we are going to be able to hold the line on any significant slippage.”
The modulated phrasing strikes a clear contrast to the stentorian tone favoured by many of the president’s predecessors, George W. Bush in particular. Yet there is still an underlying message. On the need for a co-ordinated stimulus, with which many European leaders – most recently Angela Merkel, the German chancellor, in an FT interview – disagree, Mr Obama says: “Each country has its own constraints, its own political rhythms and what we want to make sure is that everybody is doing something...and that we are prepared to step into the breach should current efforts prove inadequate.”
Likewise, time would convince Washington’s partners of the necessity of stronger steps. “You know the financial crisis hit the United States first...Not surprisingly we took some very aggressive action earlier than some other countries...I think the sense of urgency has grown and you are going to start seeing a convergence.”
At home Mr Obama has been criticised for displaying an allegedly light-hearted attitude towards the crisis. One interviewer even accused him of being “punch drunk”. Supporters say that while Mr Obama may not be able to “feel your pain” in the manner of Bill Clinton, for example, America’s 44th president is good at reducing your fever.
Mr Obama conveys a degree of pragmatism that may strike a contrast to Mr Bush with some of his counterparts this week – notably Dmitry Medvedev, the Russian president, and Hu Jintao, his Chinese counterpart, who will hold one-to-one meetings with Mr Obama in London. Neither has yet met him.
Along with the pragmatism, Mr Obama also shows an occasional flash of humour. “Obviously I admire economists – I have a whole bunch of them on my staff,” said Mr Obama, whose senior economic adviser, Lawrence Summers, is arguably the most powerful of that profession in the world. “But to start to make a whole host of plans about next year, without having better information on how the current stimulus efforts are working, is something that I think is of concern.”
Following the London meeting, Mr Obama will travel to Strasbourg for a Nato summit where he will attempt to drum up support for the expanded US operations in Afghanistan, then on to Prague for a meeting with the heads of the European Union and finally on Sunday to Turkey where he will deliver a set-piece address – his first visit as president to a majority Muslim country. It is an ambitious itinerary. Everywhere he goes, thousands of anti-globalisation protesters await him along with tens of thousands of celebrity-watchers hoping to catch a glimpse of America’s most popular leader since John F. Kennedy.
Many believe that the G20 summit will prove a vacuous waste of time and that the world economy will continue to be sucked into the recessionary vortex. Mr Obama, however, projects a Zen-like calm towards the emergencies that he faces. If his rescue operations fail to arrest the tide, history may show him to have been too unfazed. If things started to stabilise and improve, Mr Obama could be hailed as the new FDR.
On the eve of the most important world economic gathering in decades, Mr Obama is still keeping the drama at arm’s length. “I am confident that the American people, and I think people around the world, are looking to its leaders to lead and that some of the steps we have already taken are starting to bear fruit,” Mr Obama says with the same tone he has struck at home in recent weeks.
Politics demands that Mr Obama continues to rally the support of America’s increasingly impatient – and economically beleaguered – electorate. Governance requires he keeps trying to lower its pulse.
In the meantime, Mr Obama may yet have settled on a lasting plan to revive the financial sector. “I am confident that if we are persistent and we don’t approach this with a thought that there is a silver bullet out there but instead we are willing to try a range of methods...that we will get out of this current crisis,” he says.
TOUR OF DUTY:
If it’s Tuesday...
Barack Obama embarks on Tuesday on an eight-day visit to Europe – his first major overseas trip as US president. The busy itinerary includes:
●Tuesday evening: the president arrives at Stansted airport, north of London
●Wednesday: breakfast with Gordon Brown, UK prime minister, at Downing Street; bi-lateral meetings with Dmitry Medvedev of Russia and Hu Jintao of China; private meeting with Queen Elizabeth II
●Thursday: G20 meeting, London
●Friday: flight to Strasbourg, meeting with President Nicolas Sarkozy of France; helicopter to Baden-Baden, meeting with Angela Merkel, German chancellor
●Saturday: meeting with Nato leaders in Germany and France
●Sunday: Prague, EU-US summit
●Monday: Turkey, two-day visit to Istanbul and Ankara
‘Robust and stable’ system is goal of US
By Krishna Guha in Washington
Copyright The Financial Times Limited 2009
Published: March 30 2009 23:27 | Last updated: March 30 2009 23:27
http://www.ft.com/cms/s/0/86ab7a64-1d65-11de-9eb3-00144feabdc0.html
The US and Europe are united in their desire for far-reaching regulatory reform to strengthen the global financial system, Tim Geithner, the US Treasury secretary, has told the Financial Times.
Mr Geithner said ahead of the G20 summit that the “US has a huge interest in acting quickly and comprehensively to use this opportunity to develop an international consensus on how to make the system more robust and stable”.
He rejected the notion that the US is only interested in fiscal stimulus while continental Europeans want regulatory reform. He said all G20 nations agreed on the need for a strong regulatory response to the crisis and on the broad shape it should take.
“Relative to where we were in 1998 during the Asian crisis, there is a much stronger degree of consensus,” he said. “The gap between where the French are, where the Germans are, where the Americans are, where the Chinese are – it is a very small gap.”
Mr Geithner last week unveiled plans for an overhaul of US financial regulation as well as a scheme to clean up toxic bank assets – moves US officials believe give them greater credibility in international discussions.
The Treasury secretary said regulation would remain a sovereign issue. “We are not going to give anyone else the responsibility for deciding what balance between stability and efficiency is right for our markets.” But national reforms “will not work unless we are able to bring others along with us”.
Mr Geithner said the “philosophy is to make both the core institutions and the markets more robust”. The US is focused above all on strengthening capital requirements and market infrastructure.
“I begin with capital. We have a clear imperative to reform capital requirements. I think the basic cushions in the system – capital, liquidity, reserves – were too thin and procyclical in their effects.”
Mr Geithner favours what some call a “systemic risk surcharge” – tougher requirements for the most systemically important companies. The “crucial test of a financial system” is its ability to withstand failure. “That requires core institutions to hold more capital against risk. It also means market infrastructure in all these markets – in derivative markets, in securities lending, in the repo market – has to be able to absorb failure and contagion.”
But the US does not support moves to create new derivative market infrastructure at the European level.
The US and Europe both want to crack down on regulatory arbitrage. There is agreement on the need for hedge funds to register and disclose information, allowing regulators to guard against market manipulation and impose capital requirements on funds that present systemic risks. “We want the system to be able to evolve. But if an entity wants to perform the functions of a bank it should be regulated like a bank.”
Mr Geithner said the Financial Stability Forum would provide the basic infrastructure for future regulatory co-operation. Once the crisis was over the world should maintain an enhanced crisis response capacity through multilateral institutions.
For the Lehmans of this world – global financial institutions – “we need to improve the way insolvency regimes operate in different jurisdictions” he said. “In principle, you want to be able to manage the controlled failure of a global institution. But this is very hard to implement in a crisis. This is going to be a critical piece of the puzzle, but we are only at the beginning of thinking about it.”
Mr Geithner said there would be no global systemic risk regulator. “The home country authority has to have responsibility for consolidated supervision of its institutions.”
It was good for regulators to think more about system rather than institution- specific risks. But he said: “I am sceptical about the ability of central banks and regulators to provide early warnings of crises. We need to build a system that is safe against uncertainty, against ignorance, against the failure to identify the future source of crisis.”
By Edward Luce, Lionel Barber and Chrystia Freeland
Copyright The Financial Times Limited 2009
Published: March 30 2009 00:30 | Last updated: March 30 2009 00:30
http://www.ft.com/cms/s/0/74ab7ed2-1c8d-11de-977c-00144feabdc0.html
American presidents sometimes give interviews in the Oval Office. On this occasion Barack Obama chooses the nearby Roosevelt room, named after Teddy Roosevelt and his distant relative Franklin Delano Roosevelt, the last American president to be faced with a global economic crisis of this magnitude.
Then, like now, the president inherited a world economic summit in London that was scheduled just a few weeks after he took up residence in the White House (FDR came to office in March 1933, the summit was in April). Fatefully, Roosevelt chose not to attend.
Then, like now, the politics of domestic economic collapse crowded out much time for the rest of the world. Yet this time the crisis is even more global. Mr Obama also inherits an April crisis summit in London, the meeting this Thursday of the leaders of the group of 20 industrialised and developing nations.
Mindful, perhaps, that posterity blames FDR’s absence as the chief reason the 1933 summit failed to arrest global depression, Mr Obama emphasises the need for G20 leaders to be singing from the same song sheet: “The most important task for all of us is to deliver a strong message of unity in the face of crisis,” he says.
But his biggest challenges are probably at home. Dressed in a dark suit and a tie in the ruby-red he often favours, Mr Obama discloses that he reads global newspapers – an option not available to FDR: “I read the Financial Times before other people read the Financial Times [in Chicago in the 1980s],” the president says. “Now it’s trendy and everybody carries around a Financial Times.”
Seated opposite an imposing portrait of FDR and flanked by the famous “Rough Rider” portrait of Theodore Roosevelt, Mr Obama betrays few signs – other than a hint of fatigue – that the economic and political maelstrom around him has induced personal stress. Speaking without notes, props or assistance from aides, the president answers in the professorial “no drama Obama” manner which helped persuade America’s voters last November he had a better temperament than John McCain to cope with this multiplicity of emergencies.
These are immediate and tangible. Just 66 days into his new job, Mr Obama enters the interview having just unveiled a new strategic policy on Afghanistan and Pakistan, including sending another 4,000 American troops into the field on top of the 17,000 he announced last month.
Earlier he had also hosted a meeting with a group of Wall Street executives, including Lloyd Blankfein of Goldman Sachs and Jamie Dimon of JPMorgan Chase, who seemed grateful simply to be invited rather than pilloried by legislators on Capitol Hill.
Mr Obama speaks of the Wall Street executives with disapproval rather than resentment, in a clear moderation of some of the rhetoric he was employing until recently. “It was a constructive conversation,” he says. “But one of the points that I made is that at a time when everybody is needing to sacrifice there has to be a similar sense of sacrifice on the part of those various sectors of the economy that helped to precipitate this crisis.”
Shortly after his election, Mr Obama promised to “hit the ground running”. Even the highly ambitious president-elect could not have anticipated just how much running that would entail. Or how many opportunities there would be to trip up, one or two of which he has taken, such as the succession of nominees for senior posts who had to withdraw.
Following the failure of the first attempt last month by Tim Geithner, Treasury secretary, to announce guidelines for the removal of toxic assets from bank balance sheets, critics fear that Mr Obama still lacks a full strategy to revitalise the financial system.
Last week Mr Geithner unveiled the latest initiative to deal with toxic assets. The plan was attacked by some as insufficiently radical, but the president points to the stock market rally that followed. “Tim Geithner’s efforts to provide a market for asset-backed securities has helped [but] we still have a long way to go,” he says.
The president is also in the midst of increasingly tense negotiations with Capitol Hill over the White House’s breathtakingly ambitious $3,600bn (€2,700bn, £2,518bn) budget – incorporating the biggest pledges, notably universal healthcare and a cap-and-trade system for carbon emissions, on which Mr Obama campaigned before the economy started collapsing.
His budget could yet unravel amid outrage over the kind of double digit fiscal deficits last seen in the second world war when FDR was in the closing stages of his life. Then there is the small matter of managing a drawdown of US combat troops in Iraq, their redeployment to Afghanistan – the “graveyard of empires” – a continued global terrorist threat and, closer to home, the possibility of neighbouring Mexico being torn apart by a drugs war.
Much like FDR, who believed presidents should try everything, junk whatever fails and move swiftly on, Mr Obama conveys a pragmatic approach to the economic emergency, suggesting it is still a work-in-progress.
Nor, perhaps, can Mr Obama have anticipated the degree of high-wire balancing that is required of him – between the demands of increasingly populist politics and the need to take steps that will dig America and the world out of the economic crisis as quickly as possible.
Here the president faces an Everest. He concedes there is a gulf between what is politically possible and what may prove to be economically necessary. Ten days ago the House of Representatives voted to impose a 90 per cent tax retroactively on bonuses for those earning more than $125,000 who work at taxpayer-aided firms – the same firms who may now be deterred from participating in future government rescues.
The final version is likely to be diluted in the Senate next month. “That is one gap,” says Mr Obama. “Then there is a gap in ideas about how to approach a crisis like this, especially among economists – although on the issue of the stimulus there seems to be a much broader consensus [Mr Obama signed a $787bn two-year stimulus bill into law last month].”
He admits there is much less unity on how to repair the financial sector. Some, including liberal critics such as the Nobel-prize winning economists Paul Krugman and Joseph Stiglitz, argue for all-out bank nationalisation. Conservatives, meanwhile, believe the White House bail-out plan is the road to socialism.
Where consensus does reign is in the outrage felt across the political spectrum over the bonuses that recipients of US taxpayer largesse, such as AIG and Citigroup, have been awarding senior employees. There is also the balancing act of pumping lots of new spending into the economy while reassuring Treasury bond investors, particularly the Chinese, that the US remains committed to medium-term fiscal discipline. “In all countries there is an understandable tension between the steps that are needed to kick-start the economy and the fact that many of these steps are very expensive,” says Mr Obama.
This also requires balancing. The president is trying to share the public’s outrage over Wall Street’s runaway culture of over-remuneration without alienating the financiers whose co-operation would be integral to the success of his bail-out plans.
The admonition is calibrated. “To the extent that they [the Wall Street bosses] are showing restraint that compensation packages are structured so that there is some deferral until money is returned to taxpayers, that will be good for everybody,” he says. “That will put me in a stronger position to help them.”
Mr Obama has tried, with limited success, to persuade the US public that what is good for Wall Street is good for Main Street. Until bankers show serious restraint, it will be hard for him to return to Capitol Hill to ask for the hundreds of billions more that most economists believe will be needed to recapitalise the US banking sector. There is a limit to public largesse.
“If voters perceive that it is a one-way street, that we are just pouring more and more money into institutions and seeing no return other than avoiding catastrophe, then it is harder to make an argument for further intervention,” he says.
Moreover, the steps the White House has taken since Inauguration Day will take time to show results, assuming, that is, they ever do. The president believes they already are. He cites “glimmers of stabilisation” in the US property market, where housing starts recently rose, and in the markets for cars and student loans.
Only a handful of economists forecast a return to strong growth next year. Some fear that a contraction of between 3 and 6 per cent in gross domestic product this year could be followed by more of the same in 2010. “What is also difficult is the fact that the policies we initiate all take time to take effect and by its very nature politics looks for more instantaneous gratification,” the president says.
Then there is the international balancing act. Mr Obama wants to unite America’s potentially fractious partners behind a co-ordinated stimulus and new financial regulation in London this week while also arresting the threat of protectionism. Unlike FDR, Mr Obama does not inherit the Smoot-Hawley Act, which erected steep trade barriers that entrenched the Great Depression and helped pave the way to world war two.
However, the US and its partners broke their promise at the first G20 summit last November to restart the Doha round of world trade talks. According to the World Bank, which has accumulated 73 examples of protectionist measures since then, many countries are moving in the opposite direction.
The president is understanding towards his partners, not least perhaps because he recently signed into law “Buy American” clauses that discriminate against foreign suppliers. While pointing out the “Buy American” provisions are consistent with World Trade Organisation rules, he observes: “I think in a democracy there are always going to be some loose ends out there. That is true here and true around the world but overall I don’t think that we have seen a huge rush to protectionism,” he adds. “To the extent that the American people [and others] feel confident their leaders are doing everything they can to encourage and promote economic growth, I think we are going to be able to hold the line on any significant slippage.”
The modulated phrasing strikes a clear contrast to the stentorian tone favoured by many of the president’s predecessors, George W. Bush in particular. Yet there is still an underlying message. On the need for a co-ordinated stimulus, with which many European leaders – most recently Angela Merkel, the German chancellor, in an FT interview – disagree, Mr Obama says: “Each country has its own constraints, its own political rhythms and what we want to make sure is that everybody is doing something...and that we are prepared to step into the breach should current efforts prove inadequate.”
Likewise, time would convince Washington’s partners of the necessity of stronger steps. “You know the financial crisis hit the United States first...Not surprisingly we took some very aggressive action earlier than some other countries...I think the sense of urgency has grown and you are going to start seeing a convergence.”
At home Mr Obama has been criticised for displaying an allegedly light-hearted attitude towards the crisis. One interviewer even accused him of being “punch drunk”. Supporters say that while Mr Obama may not be able to “feel your pain” in the manner of Bill Clinton, for example, America’s 44th president is good at reducing your fever.
Mr Obama conveys a degree of pragmatism that may strike a contrast to Mr Bush with some of his counterparts this week – notably Dmitry Medvedev, the Russian president, and Hu Jintao, his Chinese counterpart, who will hold one-to-one meetings with Mr Obama in London. Neither has yet met him.
Along with the pragmatism, Mr Obama also shows an occasional flash of humour. “Obviously I admire economists – I have a whole bunch of them on my staff,” said Mr Obama, whose senior economic adviser, Lawrence Summers, is arguably the most powerful of that profession in the world. “But to start to make a whole host of plans about next year, without having better information on how the current stimulus efforts are working, is something that I think is of concern.”
Following the London meeting, Mr Obama will travel to Strasbourg for a Nato summit where he will attempt to drum up support for the expanded US operations in Afghanistan, then on to Prague for a meeting with the heads of the European Union and finally on Sunday to Turkey where he will deliver a set-piece address – his first visit as president to a majority Muslim country. It is an ambitious itinerary. Everywhere he goes, thousands of anti-globalisation protesters await him along with tens of thousands of celebrity-watchers hoping to catch a glimpse of America’s most popular leader since John F. Kennedy.
Many believe that the G20 summit will prove a vacuous waste of time and that the world economy will continue to be sucked into the recessionary vortex. Mr Obama, however, projects a Zen-like calm towards the emergencies that he faces. If his rescue operations fail to arrest the tide, history may show him to have been too unfazed. If things started to stabilise and improve, Mr Obama could be hailed as the new FDR.
On the eve of the most important world economic gathering in decades, Mr Obama is still keeping the drama at arm’s length. “I am confident that the American people, and I think people around the world, are looking to its leaders to lead and that some of the steps we have already taken are starting to bear fruit,” Mr Obama says with the same tone he has struck at home in recent weeks.
Politics demands that Mr Obama continues to rally the support of America’s increasingly impatient – and economically beleaguered – electorate. Governance requires he keeps trying to lower its pulse.
In the meantime, Mr Obama may yet have settled on a lasting plan to revive the financial sector. “I am confident that if we are persistent and we don’t approach this with a thought that there is a silver bullet out there but instead we are willing to try a range of methods...that we will get out of this current crisis,” he says.
TOUR OF DUTY:
If it’s Tuesday...
Barack Obama embarks on Tuesday on an eight-day visit to Europe – his first major overseas trip as US president. The busy itinerary includes:
●Tuesday evening: the president arrives at Stansted airport, north of London
●Wednesday: breakfast with Gordon Brown, UK prime minister, at Downing Street; bi-lateral meetings with Dmitry Medvedev of Russia and Hu Jintao of China; private meeting with Queen Elizabeth II
●Thursday: G20 meeting, London
●Friday: flight to Strasbourg, meeting with President Nicolas Sarkozy of France; helicopter to Baden-Baden, meeting with Angela Merkel, German chancellor
●Saturday: meeting with Nato leaders in Germany and France
●Sunday: Prague, EU-US summit
●Monday: Turkey, two-day visit to Istanbul and Ankara
‘Robust and stable’ system is goal of US
By Krishna Guha in Washington
Copyright The Financial Times Limited 2009
Published: March 30 2009 23:27 | Last updated: March 30 2009 23:27
http://www.ft.com/cms/s/0/86ab7a64-1d65-11de-9eb3-00144feabdc0.html
The US and Europe are united in their desire for far-reaching regulatory reform to strengthen the global financial system, Tim Geithner, the US Treasury secretary, has told the Financial Times.
Mr Geithner said ahead of the G20 summit that the “US has a huge interest in acting quickly and comprehensively to use this opportunity to develop an international consensus on how to make the system more robust and stable”.
He rejected the notion that the US is only interested in fiscal stimulus while continental Europeans want regulatory reform. He said all G20 nations agreed on the need for a strong regulatory response to the crisis and on the broad shape it should take.
“Relative to where we were in 1998 during the Asian crisis, there is a much stronger degree of consensus,” he said. “The gap between where the French are, where the Germans are, where the Americans are, where the Chinese are – it is a very small gap.”
Mr Geithner last week unveiled plans for an overhaul of US financial regulation as well as a scheme to clean up toxic bank assets – moves US officials believe give them greater credibility in international discussions.
The Treasury secretary said regulation would remain a sovereign issue. “We are not going to give anyone else the responsibility for deciding what balance between stability and efficiency is right for our markets.” But national reforms “will not work unless we are able to bring others along with us”.
Mr Geithner said the “philosophy is to make both the core institutions and the markets more robust”. The US is focused above all on strengthening capital requirements and market infrastructure.
“I begin with capital. We have a clear imperative to reform capital requirements. I think the basic cushions in the system – capital, liquidity, reserves – were too thin and procyclical in their effects.”
Mr Geithner favours what some call a “systemic risk surcharge” – tougher requirements for the most systemically important companies. The “crucial test of a financial system” is its ability to withstand failure. “That requires core institutions to hold more capital against risk. It also means market infrastructure in all these markets – in derivative markets, in securities lending, in the repo market – has to be able to absorb failure and contagion.”
But the US does not support moves to create new derivative market infrastructure at the European level.
The US and Europe both want to crack down on regulatory arbitrage. There is agreement on the need for hedge funds to register and disclose information, allowing regulators to guard against market manipulation and impose capital requirements on funds that present systemic risks. “We want the system to be able to evolve. But if an entity wants to perform the functions of a bank it should be regulated like a bank.”
Mr Geithner said the Financial Stability Forum would provide the basic infrastructure for future regulatory co-operation. Once the crisis was over the world should maintain an enhanced crisis response capacity through multilateral institutions.
For the Lehmans of this world – global financial institutions – “we need to improve the way insolvency regimes operate in different jurisdictions” he said. “In principle, you want to be able to manage the controlled failure of a global institution. But this is very hard to implement in a crisis. This is going to be a critical piece of the puzzle, but we are only at the beginning of thinking about it.”
Mr Geithner said there would be no global systemic risk regulator. “The home country authority has to have responsibility for consolidated supervision of its institutions.”
It was good for regulators to think more about system rather than institution- specific risks. But he said: “I am sceptical about the ability of central banks and regulators to provide early warnings of crises. We need to build a system that is safe against uncertainty, against ignorance, against the failure to identify the future source of crisis.”
Obama gets tough on US car industry
Washington Post Editorial: Tough but Fair - President Obama's response to the auto companies offers a narrow path forward.
Copyright by The Washington Post
Tuesday, March 31, 2009; Page A16
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/30/AR2009033002761.html
PRESIDENT OBAMA yesterday delivered a believable, sharp and necessary ultimatum to U.S. automakers. "We cannot make the survival of our auto industry dependent on an unending flow of taxpayer dollars," he declared. It wasn't exactly rhetoric worthy of Dirty Harry, but we hope it will cause General Motors and Chrysler to undertake the financial and structural reforms they have been avoiding.
Since December, the federal government has funneled some $17.4 billion into the two companies. GM and Chrysler had agreed, as a condition of the loans, to significantly alter their business plans, negotiate further concessions from union workers, and restructure or eliminate billions of dollars worth of debt by March 31. The president announced a day early that the companies had come up more than a few dollars short. But rather than immediately cut the companies off from the dole, as the December agreement allowed, Mr. Obama offered them a last chance to make a go of it.
The administration, which concluded that Chrysler has no chance of succeeding as a stand-alone enterprise, gave the company 30 days to finalize a merger with Italian auto manufacturer Fiat. Chrysler was offered an additional $6 billion if it consummates the deal, and was threatened with a fund cutoff if it fails. Mr. Obama was both more generous and more demanding with GM. Chairman and chief executive G. Richard Wagoner Jr., who faced the possibly impossible task of turning around the long-ailing auto giant in the midst of the deepest financial and credit crisis in a generation, was forced out by the White House. Mr. Obama praised GM for making progress on eliminating waste and rethinking product lines, but he rightly insisted on more: more cuts, more streamlining, more restructuring.
It is important that the president did not flinch in demanding even deeper concessions from workers. And he was right to keep on the table the possibility of a court-supervised bankruptcy, in which contracts can be ripped up and debts erased with little input from unions and little promise of creditor payback. All sides should work to avert this possibility by making tough decisions that will keep the company alive and preserve as many jobs as possible.
The administration has a delicate task. It must be careful not to undermine the ability of GM's new leaders to make market-driven decisions they believe are in the company's long-term interest. Yet it must not let up on holding accountable an enterprise whose very existence is being made possible by taxpayer dollars.
Do you have a different view of this issue? Debate a member of the editorial board today at http://www.washingtonpost.com/opinions.
New York Times Editorial: The Last Best Chance for Detroit
Copyright by The New York Times
Published: March 30, 2009
http://www.nytimes.com/2009/03/31/opinion/31tue1.html?_r=1&ref=global
President Obama struck an acceptable compromise on Monday between two unappealing options: letting General Motors and Chrysler go bankrupt right away or giving them tens of billions of dollars more while hoping for the best. Instead, he decided to finance their operations for just a matter of weeks while forcing them to come up with a better plan to overhaul their businesses.
Now that the government is in control of the process, it must stick to its stated objectives and deadlines. If Chrysler can’t reach an acceptable merger deal with Italy’s Fiat in a month, the government must let go, even if this means certain liquidation.
The government has 60 days to clean up G.M.’s balance sheet, eliminate debts and shed product lines and dealerships so it can emerge as a smaller, viable car company. The Obama administration should stand by its offer to support both companies through a quick and controlled bankruptcy process. Considering the unwillingness of bondholders to swap debt for equity in the automakers, bankruptcy proceedings will probably be necessary to clear most of the companies’ debt.
The government’s $17.4 billion bailout of G.M. and Chrysler last year was the right move. Including jobs at parts manufacturers and car dealers, hundreds of thousands of jobs were on the line. Still, the automakers failed to put together adequate restructuring plans that guaranteed their survival as self-sustaining companies at the other end of the taxpayers’ multibillion-dollar bailout. The government was right to refuse the additional billions they requested.
The automakers failed to reach agreements with their bondholders, to convert debt into equity, or with the United Automobile Workers union, to use equity to finance a fund for retiree health care. The restructuring plans they offered were wildly optimistic. They presumed that the companies would keep most of their market share, a dubious assumption considering past performance. And their sales projections were out of touch with the precipitous decline in the American car market.
Mr. Obama’s task force decided that Chrysler, which is heavily dependent on sport-utility vehicles, was not only hampered by the wrong product mix but also too small to survive on its own. And while the task force decided that G.M. seemed on its way to an eventual turnaround, it was seen as moving way too slowly in culling its unprofitable brands and changing its product mix. Even under an optimistic scenario, it was expected to lose money for years.
The government’s new, forceful stance is more likely to produce a meaningful overhaul of the car industry. Forcing G.M.’s chairman and chief executive, Rick Wagoner, to resign was a necessary step to bring in new leadership that can set the company on a new course. A government-backed bankruptcy process could be used to discard G.M.’s liabilities and unwanted assets and produce a profitable, albeit smaller, car company. For Chrysler, a merger with Fiat appears to be a good fit.
There will be resistance to allowing G.M. to undergo a bankruptcy proceeding. If Chrysler is threatened with liquidation, there will be enormous pressure for the government to provide more money to save it. But the auto task force has come up with what seems to be the best shot we have at obtaining a viable auto industry. The president must stick to it.
Financial Times Editorial Comment: US should not be taken for a ride
Copyright The Financial Times Limited 2009
Published: March 30 2009 20:58 | Last updated: March 30 2009 20:58
http://www.ft.com/cms/s/0/b1784cce-1d54-11de-9eb3-00144feabdc0.html
The Obama administration’s firm stance on aid for the country’s struggling carmakers surprised most observers, most of Wall Street, and not least Rick Wagoner, the ousted chief of General Motors. Despite pressure to quit from outsiders in recent months, Mr Wagoner, a 30-year veteran of the company, retained the backing of the board and appeared to think he could hang on. The government rejected his restructuring proposals and insisted on his departure. It was right on both counts.
Administration officials, mindful of a backlash against use of taxpayer funds to bail out failing enterprises, found that neither GM nor Chrysler had put forward credible plans for survival. Chrysler has no future as an independent company, they concluded, but the firm has been given a last chance, and a month’s worth of working capital, to ally with Fiat. The prognosis for GM was a little more favourable. The company has a future, says the administration, but only if it tries harder to cut costs and restructure.
Failure up to now to secure adequate concessions from creditors and the United Auto Workers union has been the main sticking-point. For both companies, supervised bankruptcies may now be the best way to force the necessary sacrifices – though, at least in GM’s case, Mr Wagoner’s removal may focus minds sufficiently to re-energise the stalled discussions. It was enough to persuade interested parties that the administration might not be bluffing when it says it is willing to let the companies go under.
Jennifer Granholm, governor of Michigan, said that the administration had made a sacrificial lamb of Mr Wagoner. His defenders point to efforts to cut costs, shed some of the firm’s brands, and pare back its dealership network. All this was too little and too late. Concessions won from the union on wages and the overhead of pensions and healthcare payments were inadequate. On the company’s newest proposals, said the administration’s task force, “cash needs associated with legacy liabilities grow to unsustainable levels, reaching approximately $6bn per year in 2013 and 2014”.
After these too-timid changes, the company was still plainly unviable. Since the board chose not to act, the administration was right to hold Mr Wagoner accountable. But it is important to hold the UAW accountable as well. Further support for the companies must not be a bail-out of the union, so deeply implicated in the companies’ failure. Mr Obama’s team has been tough with management. It must be tough on the UAW as well, or put both firms into bankruptcy.
Obama gets tough on US car industry
By Tom Braithwaite in Washington, Julie MacIntosh in New York, Bertrand Benoit in Berlin and John Reed in London
Copyright The Financial Times Limited 2009
Published: March 30 2009 18:03 | Last updated: March 31 2009 03:09
http://www.ft.com/cms/s/0/72e5d0f8-1d40-11de-9eb3-00144feabdc0.html
The Obama administration on Monday ratcheted up the government’s involvement in the US auto industry, raising the spectre of bankruptcy if debtholders, unions and executives at General Motors and Chrysler fail to make new sacrifices.
Condemning “a failure of leadership” from Washington to Detroit for the decline of America’s carmakers, President Barack Obama rejected the turnround plans GM and Chrysler presented to his administration last month. He said the government would fund GM for 60 days as it tries to put together a more aggressive restructuring programme. He gave smaller Chrysler 30 days to strike an acceptable rescue alliance with Italian carmaker Fiat.
The deadlines marked the latest step in the administration’s increasingly interventionist approach to the auto industry. Just hours after forcing Rick Wagoner out as GM chief, the Obama administration said it would let GM and Chrysler slide into bankruptcy if necessary to facilitate the industry’s restructuring. “Their best chance at success may well require utilising the bankruptcy code in a quick and surgical way,” it said.
Fritz Henderson, speaking on his first day as GM’s chief executive, indicated that he believed the risk of GM filing for bankruptcy had grown
The federal government appears to favour a restructuring plan – in development since November – under which GM could file for bankruptcy protection within a month and then split the viable parts of its business from its messier obligations, people close to the matter say.
A “new” GM containing the good assets – and backed by a plan to build and sell cars that the government feels is acceptable – could then emerge from bankruptcy protection.
The administration told Chrysler to extract heavy concessions from workers and debtholders and redraft its proposed alliance with Fiat, or risk losing its federal financing. Chrysler and Fiat expect the government to play a significant role in shaping their developing agreement, said one person close to the matter.
GM and Chrysler, which have requested an additional $21.6bn of federal funds, will receive capital to continue operating as they race to meet the deadlines.
The increased threat of automaker bankruptcies led to a steep fall in US share prices. Shares in GM fell 25.4 per cent as the S&P 500 lost 3.5 per cent
GM and Chrysler denied extra funds
By Tom Braithwaite in Washington
Copyright The Financial Times Limited 2009
Published: March 30 2009 11:25 | Last updated: March 30 2009 13:19
http://www.ft.com/cms/s/0/a2ede9ae-1cc1-11de-977c-00144feabdc0.html
The Obama administration refused on Sunday night to give fresh bail-out money to General Motors and Chrysler, telling the carmakers to come up with new plans or risk insolvency.
GM has received $13.4bn in government aid and had asked for an additional $16.6bn. Chrysler has received $4bn and had asked for another $5bn. But both companies failed to meet targets on cutting their debt and reducing the cost of benefits paid to workers.
The crisis talks between the companies and the administration’s auto task force cost the job of Rick Wagoner, chief executive and chairman of General Motors, who was asked to step down by the White House after 30 years with the carmaker. The chairman and chief executive positions will be split with company president Fritz Henderson taking over as chief executive and Kent Kresa, chairman emeritus of Northrop Grumman, taking the position of interim non-executive chairman.
Officials said on Sunday night that Chrysler would be given 30 days and GM 60 days to reach agreement with debtholders and unions, with new tougher targets for cost cutting, or they would lose their last chance for a government bailout, almost certainly sending them into bankruptcy.
“That’s going to mean a set of sacrifices from all parties involved: management, labour, shareholders, creditors, suppliers, dealers,” President Barack Obama said Sunday on CBS, before the details had been laid out.
“Everybody is going to have to come to the table and say it’s important for us to take serious restructuring steps now in order to preserve a brighter future down the road ... They’re not there yet,” Mr Obama said.
The task force, whose members include former investment bankers Steve Rattner and Ron Bloom, decided that the companies had failed to prove their viability and would not, therefore, receive the combined $21.6bn of taxpayer money they had asked for.
However, both carmakers will be supported with working capital as they work to meet their new deadlines on restructuring and could end up with more funds than they had requested. Existing loans will not be recalled.
Warranties on the companies’ cars sold in the US will be guaranteed by the government in a bid to prevent buyers from turning away from GM and Chrysler. US car sales have dropped from 16m a year earlier this year to a current trend of less than 10m a year.
GM’s Frankfurt-listed shares dropped sharply, falling 11.6 per cent.
Chrysler’s hopes for survival hinge on finalising a partnership agreement with Fiat, the Italian carmaker, which has offered to acquire 35 per cent of Chrysler in return for technology.
In a bid to prevent US taxpayer money going overseas, the task force has said it would offer up to $6bn in support to Chrysler but only with the agreement from Fiat to build new cars and engines in the US.
If Fiat wants to lift its ownership above 50 per cent, Chrysler will first have to pay back the bail-out money.
A senior administration official said the companies had failed to meet a number of benchmarks, including the requirement for GM to reduce its $27bn unsecured debt to $9bn.
Bondholders in GM, who have railed against the administration and the company as the March 31 deadline for an agreement approached, are now faced with conceding to new, even tougher, demands for debt reduction or accepting the results of a court-supervised bankruptcy.
The task force has made clear that it does not want to see the companies lapse into a traditional Chapter 11 bankruptcy from which they are unlikely to re-emerge, but would use a quick court-supervised process to restructure them forcibly as part of any final settlement.
Even though it is Mr Wagoner who is unseated at GM, the company received a much better report card than Chrysler, whose cars were condemned as lacking in quality.
While the task force concluded that GM could be turned into a strong business, it decided that Chrysler cannot survive independently.
U.S. Lays Down Terms for Auto Bailout
By SHERYL GAY STOLBERG and BILL VLASIC
Copyright by The New York Times
Published: March 30, 2009
http://www.nytimes.com/2009/03/30/business/30auto.html?ref=global-home
WASHINGTON — The White House on Sunday pushed out the chairman of General Motors and instructed Chrysler to form a partnership with the Italian automaker Fiat within 30 days as conditions for receiving another much-needed round of government aid.
The government would back an account to pay for repairs on autos made during the manufacturers’ restructuring periods.
The decision to ask G.M.’s chairman and chief executive, Rick Wagoner, to resign caught Detroit and Washington by surprise, and it underscored the Obama administration’s determination to keep a tight rein on the companies it is bailing out — a level of government involvement in business perhaps not seen since the Great Depression.
President Obama is scheduled to announce details of the auto package at the White House on Monday, but two senior officials, offering a preview on condition of anonymity, made clear that some form of bankruptcy — a quick, court-supervised restructuring, as they described it — could still be an option for one or both companies.
Mr. Obama’s auto industry task force, in a report released Sunday night assessing the viability of both companies and detailing the administration’s new plans for them, concluded that Chrysler could not survive as a stand-alone company.
The report said the company would get no more help from the government unless it can finalize a proposed alliance with the Italian automaker Fiat by April 30. It must also reduce its debt and health-care obligations.
If a deal is reached between Chrysler and Fiat, the administration says it would consider another loan of $6 billion to Chrysler.
G.M., on the other hand, has made considerable progress in developing new energy-efficient cars and could survive if it can cut costs sharply, the task force reported. The administration is giving G.M. 60 days to present a cost-cutting plan and will provide taxpayer assistance to keep it afloat during that time.
Along with Mr. Wagoner’s ouster, the task force said most of the company’s board would be replaced over the next few months. In a statement Monday, Mr. Wagoner said he had been urged to “step aside” by administration officials, “and so I have.”
His resignation is the latest example of the government taking a hands-on role in making major decisions at companies it is bailing out. The government has already pushed banks to make management changes and sharply reduce or eliminate their dividends, and it also is directing many of the decisions at the troubled insurance giant American International Group, which is nearly 80 percent owned by the government after its rescue.
In deciding to urge Mr. Wagoner to step down, the Obama administration seemed mindful of the public’s growing outrage over bailouts of private companies, as well as the bonuses paid to employees of A.I.G.
Mr. Obama is well aware that he cannot afford to give the appearance of using tax dollars to reward executives who have done a poor job, and he began signaling as early as last week that he would take a tough stance with the automakers.
In a question and answer session at the White House on Thursday, the president said there had been “a lot of mismanagement of the auto industry over the past several years,” and declared that more government help would be contingent on the companies’ “willingness to make some pretty drastic changes.”
The plan Mr. Obama is to announce on Monday will also include government backing of warranties for G.M. and Chrysler cars and trucks, to give consumers enough confidence to buy them, even if one or both are forced into bankruptcy.
In Detroit, the G.M. board said Monday in a statement that it “has recognized for some time that the company’s restructuring will likely cause a significant change in the stockholders of the company and create the need for new directors with additional skills and experience.”
“The board intends to work to nominate a slate of directors for the next annual meeting that will include a majority of new directors,” the board said.
Mr. Wagoner has presided over a steep drop in G.M.’s domestic market share, which has led to tens of billions of dollars in losses. His critics have said that management’s failure to move aggressively to address the company’s problems contributed to its dire financial situation.
“The bigger surprise is not that he resigned. That was going to happen sooner or later,” said Michael Useem, professor of management at the Wharton School of Business at the University of Pennsylvania. “But the moment seems inexplicable.”
G.M. and Chrysler have almost exhausted the combined $17.4 billion in federal aid they have received since December. G.M. has asked for up to $16.6 billion more, and Chrysler has requested another $5 billion.
Bondholders are under pressure to convert two-thirds of the $27 billion owed them into G.M. stock, while the United Auto Workers union is being asked to substitute stock for 50 percent of their health care benefits for retirees. Both groups have resisted those changes.
Administration officials say they have enough money to offer the assistance they envision under plans already approved by Congress. Even so, Mr. Obama may face skepticism on Capitol Hill and from the public.
As part of the companies’ original agreement for the loans, both were required to submit restructuring plans. Mr. Wagoner’s removal underscores how much more G.M. needs to cut than was proposed in the plan the company submitted.
Administration officials stressed that the company needed a fresh approach and leadership changes; they said Steven Rattner, the former investment banker who co-chairs the auto task force, delivered the news to Mr. Wagoner.
Sheryl Gay Stolberg reported from Washington and Bill Vlasic from Detroit. Micheline Maynard and Nick Bunkley contributed reporting from Detroit and David M. Herszenhorn from Washington.
As recently as March 18 he said in an interview that his discussions with the task force did not give him the impression that his job was at stake. “They so far haven’t commented on that,” he said then.
Frederick A. Henderson, G.M.’s president, will succeed Mr. Wagoner on an interim basis as chief executive; Kent Kresa, a board member, will assume the chairmanship. Members of the auto panel spoke with Mr. Henderson recently and came away with a favorable impression of him, people familiar with the panel’s discussions said.
Like Mr. Wagoner, Mr. Henderson is a graduate of the Harvard Business School and a lifer at G.M. He started in the finance division in 1984 and later spent nine years in executive positions in South America, Asia and Europe. The Detroit-born son of a G.M. sales manager, Mr. Henderson, 50, became chief financial officer in 2006 and was named president and chief operating officer a year ago.
Mr. Wagoner’s departure at G.M. marks an end to a corporate hierarchy that spanned generations. The last G.M. chairman to leave under duress was Robert C. Stempel, who was forced out in 1992 by outside directors who blamed him for losses.
Mr. Wagoner, 56, came to G.M. in 1977 and rose to become chief financial officer in 1992 when he was 38. He oversaw the company’s North American business for years before being named chairman in 2000.
G.M.’s share of its most important market, the United States, declined steadily under Mr. Wagoner. In 1994, when he took charge of North America, G.M. held 33.2 percent of the American car market. Last month, G.M.’s share was only 18.8 percent, according to statistics from Motorintelligence.com, which specializes in industry data. Auto sales in February were the worst for the industry since 1981.
G.M. collapsed last fall when new-vehicle sales in the United States plummeted to their lowest level in 25 years. G.M. lost more than $30 billion in 2008, and has been subsisting on government loans since the beginning of the year.
The administration briefed lawmakers on the plan Sunday night. Afterward, Representative Thaddeus G. McCotter, Republican of Michigan, whose district is just outside Detroit, expressed frustration over the ousting of Mr. Wagoner and with administration officials for not being clearer about the potential job losses that lie ahead.
“Why would you ask Rick Wagoner to resign when you are giving G.M. 60 days to meet a new target, but you aren’t saying what the new goal is yet,” Mr. McCotter said in an interview.
The Steady Optimist Who Oversaw G.M.’s Decline
By MICHELINE MAYNARD
Copyright by The New York Times
Published: March 29, 2009
http://www.nytimes.com/2009/03/30/business/30wagoner.html?th&emc=th
DETROIT — In recent years, despite many challenges to his leadership of General Motors, Rick Wagoner had managed to keep a firm grip on his job, like hands wrapped tight around a steering wheel.
Rick Wagoner took over G.M. in 2000. Since then, shares have fallen 95 percent.
During his tenure as chief executive, beginning in 2000, the company’s stock has fallen from $70 a share to less than $4 now, and its market share has fallen roughly 10 percentage points.
There have been many challenges to his authority, most notably from the investor Kirk Kerkorian in 2006 and from angry members of Congress during hearings last fall. Throughout the attacks, he had managed to retain the unwavering support of his board.
For a time, it seemed he might become the rare chief executive who gets another chance, this time to try to fix many of the problems that occurred on his watch.
But he appears to have met his match in President Obama, whose calls for sacrifices from all sides apparently included a call for Mr. Wagoner to step down.
In a statement early Monday, Mr. Wagoner said he had been urged to “step aside” by administration officials, “and so I have.” He thanked G.M. employees for their support. “G.M. is a great company with a storied history.” Mr. Wagoner said. “Ignore the doubters because I know it is also a company with a great future.”
The United Automobile Workers union had no comment on Mr. Wagoner’s departure. But Michigan’s governor, Jennifer M. Granholm, echoed an fledgling sense in Detroit that Mr. Wagoner may be viewed as an auto industry martyr. Speaking on MSNBC, Gov. Granholm said Mr. Wagoner was a “sacrficial lamb.”
During his nine years in charge, Mr. Wagoner never appeared to waver from his determination that G.M. would reclaim its spot as the unrivaled leader of the auto industry, despite steadily falling sales.
Through three major restructuring plans enacted on his watch — eliminating dozens of plants, tens of thousands of jobs and jettisoning hundreds of dealers — Mr. Wagoner maintained a stolid confidence in himself and the company’s strength. Only recently did he acknowledge the need to significantly pare the company’s brand and model lineup, to better match the company’s bloated infrastructure with the shrinking market.
Only at the second round of Congressional hearings last fall did Mr. Wagoner start agreeing that the company had made mistakes, and that its problems were not all attributable to outside forces like the weakening economy and tightening credit markets.
Mr. Wagoner joined G.M.’s financial operations in 1977 out of Harvard Business School, and, like generations of executives before him, worked nowhere else during his career.
Mr. Wagoner vaulted into Detroit’s consciousness in 1992 upon another resignation during a financial crisis — that of Robert C. Stempel, the chief executive at G.M. at the time.
Then only 38, Mr. Wagoner became G.M.’s chief financial officer. Two years later, he was named president of its North American operations.
His mentor, the chief executive John F. Smith Jr., named Mr. Wagoner president of G.M. in 1998, and he succeeded Mr. Smith in the top job in 2000.
Like Mr. Smith, Mr. Wagoner aggressively expanded G.M.’s operations outside the United States. The company now sells 65 percent of its vehicles overseas, thanks to Mr. Wagoner’s push into markets like China, Russia and Latin America.
However, G.M.’s sales slump at home led to it losing its longtime title last year as the world’s largest auto company, replaced by Toyota.
“It’s a pretty unceremonious ending,” said John Casesa, an industry analyst and managing partner of the Casesa Shapiro Group. “G.M. lost its way in the ‘70s, but the company didn’t know it until 20 years late. The hole was much deeper than he realized when he became C.E.O.”
And, Mr. Casesa said, Mr. Wagoner’s finance background might have been a poor fit: “The most successful auto companies are run by people who came out of the revenue-generating functions — manufacturing, design, marketing — making cars and selling cars.” Mr. Wagoner, the analyst said, “skipped the whole apprenticeship that most auto C.E.O.’s experience.”
Mr. Wagoner presided over some of the biggest losses in G.M. history. In 2002, the company had predicted that it would earn $10 a share by the middle of the decade.
Instead, G.M. lost $30.9 billion in 2008, when its per-share loss translated to more than $50 a share. G.M. stock, an economic bellwether that sold above $35 only three years ago, closed Friday at $3.62; it has fallen as low as $1.27 in the last year.
In 1994, when he took charge of G.M.’s North American operations, the company made up 33.2 percent of auto sales in the United States.
Last month, G.M. represented only 18.8 percent of American car and truck sales, according to statistics from Motor Intelligence, which tracks industry data.
Under pressure to stop G.M.’s sliding market share, Mr. Wagoner hired Robert A. Lutz, a longtime auto industry executive, in 2002. Mr. Lutz reorganized G.M.’s product development operations, and introduced a number of new vehicles, including sporty models like the Pontiac Solstice and Saturn Sky.
Both Mr. Lutz, who had previously announced his plans to retire by year’s end, and Mr. Wagoner have championed the Chevrolet Volt, a plug-in hybrid electric car that G.M. plans to introduce in late 2010.
Mr. Wagoner has said that one of the moves he regretted most was G.M’s decision to kill the EV-1, an electric car that it leased to customers in the late 1990s. Although the vehicle was not profitable, it helped G.M.’s image with environmentalists, which in 2006 Mr. Wagoner conceded he had understood too late.
Only six months ago, Mr. Wagoner stood in front of hundreds of G.M. employees in the atrium of the company’s Detroit headquarters, celebrating the automaker’s 100th anniversary.
Dressed in a gray suit and a yellow, blue and white striped tie, Mr. Wagoner said: “So, what’s our assignment for today and tomorrow? Above all, it’s to demonstrate to the world that we are more than a 100-year-old company. We’re a company that’s ready to lead for 100 years to come.”
Copyright by The Washington Post
Tuesday, March 31, 2009; Page A16
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/30/AR2009033002761.html
PRESIDENT OBAMA yesterday delivered a believable, sharp and necessary ultimatum to U.S. automakers. "We cannot make the survival of our auto industry dependent on an unending flow of taxpayer dollars," he declared. It wasn't exactly rhetoric worthy of Dirty Harry, but we hope it will cause General Motors and Chrysler to undertake the financial and structural reforms they have been avoiding.
Since December, the federal government has funneled some $17.4 billion into the two companies. GM and Chrysler had agreed, as a condition of the loans, to significantly alter their business plans, negotiate further concessions from union workers, and restructure or eliminate billions of dollars worth of debt by March 31. The president announced a day early that the companies had come up more than a few dollars short. But rather than immediately cut the companies off from the dole, as the December agreement allowed, Mr. Obama offered them a last chance to make a go of it.
The administration, which concluded that Chrysler has no chance of succeeding as a stand-alone enterprise, gave the company 30 days to finalize a merger with Italian auto manufacturer Fiat. Chrysler was offered an additional $6 billion if it consummates the deal, and was threatened with a fund cutoff if it fails. Mr. Obama was both more generous and more demanding with GM. Chairman and chief executive G. Richard Wagoner Jr., who faced the possibly impossible task of turning around the long-ailing auto giant in the midst of the deepest financial and credit crisis in a generation, was forced out by the White House. Mr. Obama praised GM for making progress on eliminating waste and rethinking product lines, but he rightly insisted on more: more cuts, more streamlining, more restructuring.
It is important that the president did not flinch in demanding even deeper concessions from workers. And he was right to keep on the table the possibility of a court-supervised bankruptcy, in which contracts can be ripped up and debts erased with little input from unions and little promise of creditor payback. All sides should work to avert this possibility by making tough decisions that will keep the company alive and preserve as many jobs as possible.
The administration has a delicate task. It must be careful not to undermine the ability of GM's new leaders to make market-driven decisions they believe are in the company's long-term interest. Yet it must not let up on holding accountable an enterprise whose very existence is being made possible by taxpayer dollars.
Do you have a different view of this issue? Debate a member of the editorial board today at http://www.washingtonpost.com/opinions.
New York Times Editorial: The Last Best Chance for Detroit
Copyright by The New York Times
Published: March 30, 2009
http://www.nytimes.com/2009/03/31/opinion/31tue1.html?_r=1&ref=global
President Obama struck an acceptable compromise on Monday between two unappealing options: letting General Motors and Chrysler go bankrupt right away or giving them tens of billions of dollars more while hoping for the best. Instead, he decided to finance their operations for just a matter of weeks while forcing them to come up with a better plan to overhaul their businesses.
Now that the government is in control of the process, it must stick to its stated objectives and deadlines. If Chrysler can’t reach an acceptable merger deal with Italy’s Fiat in a month, the government must let go, even if this means certain liquidation.
The government has 60 days to clean up G.M.’s balance sheet, eliminate debts and shed product lines and dealerships so it can emerge as a smaller, viable car company. The Obama administration should stand by its offer to support both companies through a quick and controlled bankruptcy process. Considering the unwillingness of bondholders to swap debt for equity in the automakers, bankruptcy proceedings will probably be necessary to clear most of the companies’ debt.
The government’s $17.4 billion bailout of G.M. and Chrysler last year was the right move. Including jobs at parts manufacturers and car dealers, hundreds of thousands of jobs were on the line. Still, the automakers failed to put together adequate restructuring plans that guaranteed their survival as self-sustaining companies at the other end of the taxpayers’ multibillion-dollar bailout. The government was right to refuse the additional billions they requested.
The automakers failed to reach agreements with their bondholders, to convert debt into equity, or with the United Automobile Workers union, to use equity to finance a fund for retiree health care. The restructuring plans they offered were wildly optimistic. They presumed that the companies would keep most of their market share, a dubious assumption considering past performance. And their sales projections were out of touch with the precipitous decline in the American car market.
Mr. Obama’s task force decided that Chrysler, which is heavily dependent on sport-utility vehicles, was not only hampered by the wrong product mix but also too small to survive on its own. And while the task force decided that G.M. seemed on its way to an eventual turnaround, it was seen as moving way too slowly in culling its unprofitable brands and changing its product mix. Even under an optimistic scenario, it was expected to lose money for years.
The government’s new, forceful stance is more likely to produce a meaningful overhaul of the car industry. Forcing G.M.’s chairman and chief executive, Rick Wagoner, to resign was a necessary step to bring in new leadership that can set the company on a new course. A government-backed bankruptcy process could be used to discard G.M.’s liabilities and unwanted assets and produce a profitable, albeit smaller, car company. For Chrysler, a merger with Fiat appears to be a good fit.
There will be resistance to allowing G.M. to undergo a bankruptcy proceeding. If Chrysler is threatened with liquidation, there will be enormous pressure for the government to provide more money to save it. But the auto task force has come up with what seems to be the best shot we have at obtaining a viable auto industry. The president must stick to it.
Financial Times Editorial Comment: US should not be taken for a ride
Copyright The Financial Times Limited 2009
Published: March 30 2009 20:58 | Last updated: March 30 2009 20:58
http://www.ft.com/cms/s/0/b1784cce-1d54-11de-9eb3-00144feabdc0.html
The Obama administration’s firm stance on aid for the country’s struggling carmakers surprised most observers, most of Wall Street, and not least Rick Wagoner, the ousted chief of General Motors. Despite pressure to quit from outsiders in recent months, Mr Wagoner, a 30-year veteran of the company, retained the backing of the board and appeared to think he could hang on. The government rejected his restructuring proposals and insisted on his departure. It was right on both counts.
Administration officials, mindful of a backlash against use of taxpayer funds to bail out failing enterprises, found that neither GM nor Chrysler had put forward credible plans for survival. Chrysler has no future as an independent company, they concluded, but the firm has been given a last chance, and a month’s worth of working capital, to ally with Fiat. The prognosis for GM was a little more favourable. The company has a future, says the administration, but only if it tries harder to cut costs and restructure.
Failure up to now to secure adequate concessions from creditors and the United Auto Workers union has been the main sticking-point. For both companies, supervised bankruptcies may now be the best way to force the necessary sacrifices – though, at least in GM’s case, Mr Wagoner’s removal may focus minds sufficiently to re-energise the stalled discussions. It was enough to persuade interested parties that the administration might not be bluffing when it says it is willing to let the companies go under.
Jennifer Granholm, governor of Michigan, said that the administration had made a sacrificial lamb of Mr Wagoner. His defenders point to efforts to cut costs, shed some of the firm’s brands, and pare back its dealership network. All this was too little and too late. Concessions won from the union on wages and the overhead of pensions and healthcare payments were inadequate. On the company’s newest proposals, said the administration’s task force, “cash needs associated with legacy liabilities grow to unsustainable levels, reaching approximately $6bn per year in 2013 and 2014”.
After these too-timid changes, the company was still plainly unviable. Since the board chose not to act, the administration was right to hold Mr Wagoner accountable. But it is important to hold the UAW accountable as well. Further support for the companies must not be a bail-out of the union, so deeply implicated in the companies’ failure. Mr Obama’s team has been tough with management. It must be tough on the UAW as well, or put both firms into bankruptcy.
Obama gets tough on US car industry
By Tom Braithwaite in Washington, Julie MacIntosh in New York, Bertrand Benoit in Berlin and John Reed in London
Copyright The Financial Times Limited 2009
Published: March 30 2009 18:03 | Last updated: March 31 2009 03:09
http://www.ft.com/cms/s/0/72e5d0f8-1d40-11de-9eb3-00144feabdc0.html
The Obama administration on Monday ratcheted up the government’s involvement in the US auto industry, raising the spectre of bankruptcy if debtholders, unions and executives at General Motors and Chrysler fail to make new sacrifices.
Condemning “a failure of leadership” from Washington to Detroit for the decline of America’s carmakers, President Barack Obama rejected the turnround plans GM and Chrysler presented to his administration last month. He said the government would fund GM for 60 days as it tries to put together a more aggressive restructuring programme. He gave smaller Chrysler 30 days to strike an acceptable rescue alliance with Italian carmaker Fiat.
The deadlines marked the latest step in the administration’s increasingly interventionist approach to the auto industry. Just hours after forcing Rick Wagoner out as GM chief, the Obama administration said it would let GM and Chrysler slide into bankruptcy if necessary to facilitate the industry’s restructuring. “Their best chance at success may well require utilising the bankruptcy code in a quick and surgical way,” it said.
Fritz Henderson, speaking on his first day as GM’s chief executive, indicated that he believed the risk of GM filing for bankruptcy had grown
The federal government appears to favour a restructuring plan – in development since November – under which GM could file for bankruptcy protection within a month and then split the viable parts of its business from its messier obligations, people close to the matter say.
A “new” GM containing the good assets – and backed by a plan to build and sell cars that the government feels is acceptable – could then emerge from bankruptcy protection.
The administration told Chrysler to extract heavy concessions from workers and debtholders and redraft its proposed alliance with Fiat, or risk losing its federal financing. Chrysler and Fiat expect the government to play a significant role in shaping their developing agreement, said one person close to the matter.
GM and Chrysler, which have requested an additional $21.6bn of federal funds, will receive capital to continue operating as they race to meet the deadlines.
The increased threat of automaker bankruptcies led to a steep fall in US share prices. Shares in GM fell 25.4 per cent as the S&P 500 lost 3.5 per cent
GM and Chrysler denied extra funds
By Tom Braithwaite in Washington
Copyright The Financial Times Limited 2009
Published: March 30 2009 11:25 | Last updated: March 30 2009 13:19
http://www.ft.com/cms/s/0/a2ede9ae-1cc1-11de-977c-00144feabdc0.html
The Obama administration refused on Sunday night to give fresh bail-out money to General Motors and Chrysler, telling the carmakers to come up with new plans or risk insolvency.
GM has received $13.4bn in government aid and had asked for an additional $16.6bn. Chrysler has received $4bn and had asked for another $5bn. But both companies failed to meet targets on cutting their debt and reducing the cost of benefits paid to workers.
The crisis talks between the companies and the administration’s auto task force cost the job of Rick Wagoner, chief executive and chairman of General Motors, who was asked to step down by the White House after 30 years with the carmaker. The chairman and chief executive positions will be split with company president Fritz Henderson taking over as chief executive and Kent Kresa, chairman emeritus of Northrop Grumman, taking the position of interim non-executive chairman.
Officials said on Sunday night that Chrysler would be given 30 days and GM 60 days to reach agreement with debtholders and unions, with new tougher targets for cost cutting, or they would lose their last chance for a government bailout, almost certainly sending them into bankruptcy.
“That’s going to mean a set of sacrifices from all parties involved: management, labour, shareholders, creditors, suppliers, dealers,” President Barack Obama said Sunday on CBS, before the details had been laid out.
“Everybody is going to have to come to the table and say it’s important for us to take serious restructuring steps now in order to preserve a brighter future down the road ... They’re not there yet,” Mr Obama said.
The task force, whose members include former investment bankers Steve Rattner and Ron Bloom, decided that the companies had failed to prove their viability and would not, therefore, receive the combined $21.6bn of taxpayer money they had asked for.
However, both carmakers will be supported with working capital as they work to meet their new deadlines on restructuring and could end up with more funds than they had requested. Existing loans will not be recalled.
Warranties on the companies’ cars sold in the US will be guaranteed by the government in a bid to prevent buyers from turning away from GM and Chrysler. US car sales have dropped from 16m a year earlier this year to a current trend of less than 10m a year.
GM’s Frankfurt-listed shares dropped sharply, falling 11.6 per cent.
Chrysler’s hopes for survival hinge on finalising a partnership agreement with Fiat, the Italian carmaker, which has offered to acquire 35 per cent of Chrysler in return for technology.
In a bid to prevent US taxpayer money going overseas, the task force has said it would offer up to $6bn in support to Chrysler but only with the agreement from Fiat to build new cars and engines in the US.
If Fiat wants to lift its ownership above 50 per cent, Chrysler will first have to pay back the bail-out money.
A senior administration official said the companies had failed to meet a number of benchmarks, including the requirement for GM to reduce its $27bn unsecured debt to $9bn.
Bondholders in GM, who have railed against the administration and the company as the March 31 deadline for an agreement approached, are now faced with conceding to new, even tougher, demands for debt reduction or accepting the results of a court-supervised bankruptcy.
The task force has made clear that it does not want to see the companies lapse into a traditional Chapter 11 bankruptcy from which they are unlikely to re-emerge, but would use a quick court-supervised process to restructure them forcibly as part of any final settlement.
Even though it is Mr Wagoner who is unseated at GM, the company received a much better report card than Chrysler, whose cars were condemned as lacking in quality.
While the task force concluded that GM could be turned into a strong business, it decided that Chrysler cannot survive independently.
U.S. Lays Down Terms for Auto Bailout
By SHERYL GAY STOLBERG and BILL VLASIC
Copyright by The New York Times
Published: March 30, 2009
http://www.nytimes.com/2009/03/30/business/30auto.html?ref=global-home
WASHINGTON — The White House on Sunday pushed out the chairman of General Motors and instructed Chrysler to form a partnership with the Italian automaker Fiat within 30 days as conditions for receiving another much-needed round of government aid.
The government would back an account to pay for repairs on autos made during the manufacturers’ restructuring periods.
The decision to ask G.M.’s chairman and chief executive, Rick Wagoner, to resign caught Detroit and Washington by surprise, and it underscored the Obama administration’s determination to keep a tight rein on the companies it is bailing out — a level of government involvement in business perhaps not seen since the Great Depression.
President Obama is scheduled to announce details of the auto package at the White House on Monday, but two senior officials, offering a preview on condition of anonymity, made clear that some form of bankruptcy — a quick, court-supervised restructuring, as they described it — could still be an option for one or both companies.
Mr. Obama’s auto industry task force, in a report released Sunday night assessing the viability of both companies and detailing the administration’s new plans for them, concluded that Chrysler could not survive as a stand-alone company.
The report said the company would get no more help from the government unless it can finalize a proposed alliance with the Italian automaker Fiat by April 30. It must also reduce its debt and health-care obligations.
If a deal is reached between Chrysler and Fiat, the administration says it would consider another loan of $6 billion to Chrysler.
G.M., on the other hand, has made considerable progress in developing new energy-efficient cars and could survive if it can cut costs sharply, the task force reported. The administration is giving G.M. 60 days to present a cost-cutting plan and will provide taxpayer assistance to keep it afloat during that time.
Along with Mr. Wagoner’s ouster, the task force said most of the company’s board would be replaced over the next few months. In a statement Monday, Mr. Wagoner said he had been urged to “step aside” by administration officials, “and so I have.”
His resignation is the latest example of the government taking a hands-on role in making major decisions at companies it is bailing out. The government has already pushed banks to make management changes and sharply reduce or eliminate their dividends, and it also is directing many of the decisions at the troubled insurance giant American International Group, which is nearly 80 percent owned by the government after its rescue.
In deciding to urge Mr. Wagoner to step down, the Obama administration seemed mindful of the public’s growing outrage over bailouts of private companies, as well as the bonuses paid to employees of A.I.G.
Mr. Obama is well aware that he cannot afford to give the appearance of using tax dollars to reward executives who have done a poor job, and he began signaling as early as last week that he would take a tough stance with the automakers.
In a question and answer session at the White House on Thursday, the president said there had been “a lot of mismanagement of the auto industry over the past several years,” and declared that more government help would be contingent on the companies’ “willingness to make some pretty drastic changes.”
The plan Mr. Obama is to announce on Monday will also include government backing of warranties for G.M. and Chrysler cars and trucks, to give consumers enough confidence to buy them, even if one or both are forced into bankruptcy.
In Detroit, the G.M. board said Monday in a statement that it “has recognized for some time that the company’s restructuring will likely cause a significant change in the stockholders of the company and create the need for new directors with additional skills and experience.”
“The board intends to work to nominate a slate of directors for the next annual meeting that will include a majority of new directors,” the board said.
Mr. Wagoner has presided over a steep drop in G.M.’s domestic market share, which has led to tens of billions of dollars in losses. His critics have said that management’s failure to move aggressively to address the company’s problems contributed to its dire financial situation.
“The bigger surprise is not that he resigned. That was going to happen sooner or later,” said Michael Useem, professor of management at the Wharton School of Business at the University of Pennsylvania. “But the moment seems inexplicable.”
G.M. and Chrysler have almost exhausted the combined $17.4 billion in federal aid they have received since December. G.M. has asked for up to $16.6 billion more, and Chrysler has requested another $5 billion.
Bondholders are under pressure to convert two-thirds of the $27 billion owed them into G.M. stock, while the United Auto Workers union is being asked to substitute stock for 50 percent of their health care benefits for retirees. Both groups have resisted those changes.
Administration officials say they have enough money to offer the assistance they envision under plans already approved by Congress. Even so, Mr. Obama may face skepticism on Capitol Hill and from the public.
As part of the companies’ original agreement for the loans, both were required to submit restructuring plans. Mr. Wagoner’s removal underscores how much more G.M. needs to cut than was proposed in the plan the company submitted.
Administration officials stressed that the company needed a fresh approach and leadership changes; they said Steven Rattner, the former investment banker who co-chairs the auto task force, delivered the news to Mr. Wagoner.
Sheryl Gay Stolberg reported from Washington and Bill Vlasic from Detroit. Micheline Maynard and Nick Bunkley contributed reporting from Detroit and David M. Herszenhorn from Washington.
As recently as March 18 he said in an interview that his discussions with the task force did not give him the impression that his job was at stake. “They so far haven’t commented on that,” he said then.
Frederick A. Henderson, G.M.’s president, will succeed Mr. Wagoner on an interim basis as chief executive; Kent Kresa, a board member, will assume the chairmanship. Members of the auto panel spoke with Mr. Henderson recently and came away with a favorable impression of him, people familiar with the panel’s discussions said.
Like Mr. Wagoner, Mr. Henderson is a graduate of the Harvard Business School and a lifer at G.M. He started in the finance division in 1984 and later spent nine years in executive positions in South America, Asia and Europe. The Detroit-born son of a G.M. sales manager, Mr. Henderson, 50, became chief financial officer in 2006 and was named president and chief operating officer a year ago.
Mr. Wagoner’s departure at G.M. marks an end to a corporate hierarchy that spanned generations. The last G.M. chairman to leave under duress was Robert C. Stempel, who was forced out in 1992 by outside directors who blamed him for losses.
Mr. Wagoner, 56, came to G.M. in 1977 and rose to become chief financial officer in 1992 when he was 38. He oversaw the company’s North American business for years before being named chairman in 2000.
G.M.’s share of its most important market, the United States, declined steadily under Mr. Wagoner. In 1994, when he took charge of North America, G.M. held 33.2 percent of the American car market. Last month, G.M.’s share was only 18.8 percent, according to statistics from Motorintelligence.com, which specializes in industry data. Auto sales in February were the worst for the industry since 1981.
G.M. collapsed last fall when new-vehicle sales in the United States plummeted to their lowest level in 25 years. G.M. lost more than $30 billion in 2008, and has been subsisting on government loans since the beginning of the year.
The administration briefed lawmakers on the plan Sunday night. Afterward, Representative Thaddeus G. McCotter, Republican of Michigan, whose district is just outside Detroit, expressed frustration over the ousting of Mr. Wagoner and with administration officials for not being clearer about the potential job losses that lie ahead.
“Why would you ask Rick Wagoner to resign when you are giving G.M. 60 days to meet a new target, but you aren’t saying what the new goal is yet,” Mr. McCotter said in an interview.
The Steady Optimist Who Oversaw G.M.’s Decline
By MICHELINE MAYNARD
Copyright by The New York Times
Published: March 29, 2009
http://www.nytimes.com/2009/03/30/business/30wagoner.html?th&emc=th
DETROIT — In recent years, despite many challenges to his leadership of General Motors, Rick Wagoner had managed to keep a firm grip on his job, like hands wrapped tight around a steering wheel.
Rick Wagoner took over G.M. in 2000. Since then, shares have fallen 95 percent.
During his tenure as chief executive, beginning in 2000, the company’s stock has fallen from $70 a share to less than $4 now, and its market share has fallen roughly 10 percentage points.
There have been many challenges to his authority, most notably from the investor Kirk Kerkorian in 2006 and from angry members of Congress during hearings last fall. Throughout the attacks, he had managed to retain the unwavering support of his board.
For a time, it seemed he might become the rare chief executive who gets another chance, this time to try to fix many of the problems that occurred on his watch.
But he appears to have met his match in President Obama, whose calls for sacrifices from all sides apparently included a call for Mr. Wagoner to step down.
In a statement early Monday, Mr. Wagoner said he had been urged to “step aside” by administration officials, “and so I have.” He thanked G.M. employees for their support. “G.M. is a great company with a storied history.” Mr. Wagoner said. “Ignore the doubters because I know it is also a company with a great future.”
The United Automobile Workers union had no comment on Mr. Wagoner’s departure. But Michigan’s governor, Jennifer M. Granholm, echoed an fledgling sense in Detroit that Mr. Wagoner may be viewed as an auto industry martyr. Speaking on MSNBC, Gov. Granholm said Mr. Wagoner was a “sacrficial lamb.”
During his nine years in charge, Mr. Wagoner never appeared to waver from his determination that G.M. would reclaim its spot as the unrivaled leader of the auto industry, despite steadily falling sales.
Through three major restructuring plans enacted on his watch — eliminating dozens of plants, tens of thousands of jobs and jettisoning hundreds of dealers — Mr. Wagoner maintained a stolid confidence in himself and the company’s strength. Only recently did he acknowledge the need to significantly pare the company’s brand and model lineup, to better match the company’s bloated infrastructure with the shrinking market.
Only at the second round of Congressional hearings last fall did Mr. Wagoner start agreeing that the company had made mistakes, and that its problems were not all attributable to outside forces like the weakening economy and tightening credit markets.
Mr. Wagoner joined G.M.’s financial operations in 1977 out of Harvard Business School, and, like generations of executives before him, worked nowhere else during his career.
Mr. Wagoner vaulted into Detroit’s consciousness in 1992 upon another resignation during a financial crisis — that of Robert C. Stempel, the chief executive at G.M. at the time.
Then only 38, Mr. Wagoner became G.M.’s chief financial officer. Two years later, he was named president of its North American operations.
His mentor, the chief executive John F. Smith Jr., named Mr. Wagoner president of G.M. in 1998, and he succeeded Mr. Smith in the top job in 2000.
Like Mr. Smith, Mr. Wagoner aggressively expanded G.M.’s operations outside the United States. The company now sells 65 percent of its vehicles overseas, thanks to Mr. Wagoner’s push into markets like China, Russia and Latin America.
However, G.M.’s sales slump at home led to it losing its longtime title last year as the world’s largest auto company, replaced by Toyota.
“It’s a pretty unceremonious ending,” said John Casesa, an industry analyst and managing partner of the Casesa Shapiro Group. “G.M. lost its way in the ‘70s, but the company didn’t know it until 20 years late. The hole was much deeper than he realized when he became C.E.O.”
And, Mr. Casesa said, Mr. Wagoner’s finance background might have been a poor fit: “The most successful auto companies are run by people who came out of the revenue-generating functions — manufacturing, design, marketing — making cars and selling cars.” Mr. Wagoner, the analyst said, “skipped the whole apprenticeship that most auto C.E.O.’s experience.”
Mr. Wagoner presided over some of the biggest losses in G.M. history. In 2002, the company had predicted that it would earn $10 a share by the middle of the decade.
Instead, G.M. lost $30.9 billion in 2008, when its per-share loss translated to more than $50 a share. G.M. stock, an economic bellwether that sold above $35 only three years ago, closed Friday at $3.62; it has fallen as low as $1.27 in the last year.
In 1994, when he took charge of G.M.’s North American operations, the company made up 33.2 percent of auto sales in the United States.
Last month, G.M. represented only 18.8 percent of American car and truck sales, according to statistics from Motor Intelligence, which tracks industry data.
Under pressure to stop G.M.’s sliding market share, Mr. Wagoner hired Robert A. Lutz, a longtime auto industry executive, in 2002. Mr. Lutz reorganized G.M.’s product development operations, and introduced a number of new vehicles, including sporty models like the Pontiac Solstice and Saturn Sky.
Both Mr. Lutz, who had previously announced his plans to retire by year’s end, and Mr. Wagoner have championed the Chevrolet Volt, a plug-in hybrid electric car that G.M. plans to introduce in late 2010.
Mr. Wagoner has said that one of the moves he regretted most was G.M’s decision to kill the EV-1, an electric car that it leased to customers in the late 1990s. Although the vehicle was not profitable, it helped G.M.’s image with environmentalists, which in 2006 Mr. Wagoner conceded he had understood too late.
Only six months ago, Mr. Wagoner stood in front of hundreds of G.M. employees in the atrium of the company’s Detroit headquarters, celebrating the automaker’s 100th anniversary.
Dressed in a gray suit and a yellow, blue and white striped tie, Mr. Wagoner said: “So, what’s our assignment for today and tomorrow? Above all, it’s to demonstrate to the world that we are more than a 100-year-old company. We’re a company that’s ready to lead for 100 years to come.”
Sunday, March 29, 2009
U.S. ally's arrest unleashes fierce firefights in Baghdad - At least 15 wounded in gunfights after Iraq holds key U.S. ally and aide
U.S. ally's arrest unleashes fierce firefights in Baghdad - At least 15 wounded in gunfights after Iraq holds key U.S. ally and aide
By Sudarsan Raghavan
Copyright © 2009, Chicago Tribune and The Washington Post
1:25 AM CDT, March 29, 2009
http://www.chicagotribune.com/news/nationworld/chi-iraq_5smar29,0,6313535.story
BAGHDAD — American and Iraqi forces arrested an influential U.S. ally Saturday, triggering fierce clashes in central Baghdad that threatened to disrupt a key pillar of American efforts to stabilize the capital as combat forces draw down.
As Apache helicopter gunships cruised above Baghdad's Fadhil neighborhood, former Sunni insurgents fought from rooftops and street corners against American and Iraqi forces, according to witnesses, the Iraqi military and police. At least 15 people were wounded in the gunfights, which lasted several hours. By nightfall, the street fighters had taken five Iraqi soldiers hostage.
The battles, the most ferocious in nearly a year in Baghdad, erupted minutes after the arrest of Adil al-Mashhadani, the leader of the Fadhil Awakening Council, which is composed mostly of former Sunni insurgents who allied themselves with the U.S. military in exchange for monthly salaries that are now paid by Iraq's government.
The formation of Awakening Councils across Iraq, which include an estimated 100,000 fighters, is widely credited with bringing down violence in many Sunni insurgent strongholds such as Fadhil. But mistrust has lingered between the councils and Iraq's Shiite leaders. Saturday's violence illustrated these tensions, which appear to be deepening.
"We will fight them till the end if they don't release him," declared Abu Mirna, a spokesman for the Fadhil Awakening Council. As he spoke by phone, the sounds of heavy gunfire could be heard in the background.
Iraq's chief military spokesman, Gen. Qassim Atta, said an arrest warrant had been issued for Mashhadani and an aide for committing "terrorist acts."
U.S. military commanders have expressed concern that many Awakening fighters, dubbed the Sons of Iraq by the U.S. military, could end up returning to supporting the insurgent group Al Qaeda in Iraq if they feel oppressed by the government. Most Awakening groups have been transferred to Iraqi government control, much to the dissatisfaction of many of their leaders.
In recent months, Iraqi security forces have targeted dozens of Awakening leaders in Baghdad, Anbar and Diyala provinces for past crimes, fearing they could turn against them once U.S. troops withdraw. And for the past year, many Awakening commanders and fighters have expressed frustration over late salary payments and low acceptance rates into Iraq's security forces.
On Saturday, a U.S. military spokesman said that Mashhadani was not arrested for his role as an Awakening leader and that the groups were not being targeted.
"The Sons of Iraq have provided a great service to the people of Iraq," said Col. Bill Buckner, a U.S. military spokesman.
In Fadhil, anger mounted against the American military. Awakening fighters said they felt betrayed for the support role the U.S. troops played in Mashhadani's arrest.
By Saturday night, U.S. armored vehicles patrolled the streets; others were positioned at entrances to the neighborhoods. American snipers flashed green laser lights at approaching vehicles signaling them to turn around.
Abu Mirna said it is too early to decide whether the fighters would break off their alliance with the U.S. military. But it was clear their relationship had been tainted by Mashhadani's arrest and Saturday's clashes.
"The American forces do not have credibility with us," Abu Mirna said. "They fought the Fadhil people. We used to call the American forces 'the friendly forces.' What they have done today was unexpected. What happened today will affect the trust between other Awakening groups and the Americans."
"If they don't release Adil Mashhadani, all the Awakening in Iraq will rise up like our uprising today," he added.
The reaction from other Awakening leaders across Baghdad was mixed. In the former Sunni insurgent haven of Dora, Ali Hussain Hafidh, an Awakening commander, said he was alarmed by the sight of four U.S. Humvees on his street. "I said to myself, 'They must have arrived to arrest me,' " he said. "We always feel worried about our usual enemies such as Al Qaeda and the Shiite militias. Now, we have to add the Americans and the Iraqi government to our worries."
By Sudarsan Raghavan
Copyright © 2009, Chicago Tribune and The Washington Post
1:25 AM CDT, March 29, 2009
http://www.chicagotribune.com/news/nationworld/chi-iraq_5smar29,0,6313535.story
BAGHDAD — American and Iraqi forces arrested an influential U.S. ally Saturday, triggering fierce clashes in central Baghdad that threatened to disrupt a key pillar of American efforts to stabilize the capital as combat forces draw down.
As Apache helicopter gunships cruised above Baghdad's Fadhil neighborhood, former Sunni insurgents fought from rooftops and street corners against American and Iraqi forces, according to witnesses, the Iraqi military and police. At least 15 people were wounded in the gunfights, which lasted several hours. By nightfall, the street fighters had taken five Iraqi soldiers hostage.
The battles, the most ferocious in nearly a year in Baghdad, erupted minutes after the arrest of Adil al-Mashhadani, the leader of the Fadhil Awakening Council, which is composed mostly of former Sunni insurgents who allied themselves with the U.S. military in exchange for monthly salaries that are now paid by Iraq's government.
The formation of Awakening Councils across Iraq, which include an estimated 100,000 fighters, is widely credited with bringing down violence in many Sunni insurgent strongholds such as Fadhil. But mistrust has lingered between the councils and Iraq's Shiite leaders. Saturday's violence illustrated these tensions, which appear to be deepening.
"We will fight them till the end if they don't release him," declared Abu Mirna, a spokesman for the Fadhil Awakening Council. As he spoke by phone, the sounds of heavy gunfire could be heard in the background.
Iraq's chief military spokesman, Gen. Qassim Atta, said an arrest warrant had been issued for Mashhadani and an aide for committing "terrorist acts."
U.S. military commanders have expressed concern that many Awakening fighters, dubbed the Sons of Iraq by the U.S. military, could end up returning to supporting the insurgent group Al Qaeda in Iraq if they feel oppressed by the government. Most Awakening groups have been transferred to Iraqi government control, much to the dissatisfaction of many of their leaders.
In recent months, Iraqi security forces have targeted dozens of Awakening leaders in Baghdad, Anbar and Diyala provinces for past crimes, fearing they could turn against them once U.S. troops withdraw. And for the past year, many Awakening commanders and fighters have expressed frustration over late salary payments and low acceptance rates into Iraq's security forces.
On Saturday, a U.S. military spokesman said that Mashhadani was not arrested for his role as an Awakening leader and that the groups were not being targeted.
"The Sons of Iraq have provided a great service to the people of Iraq," said Col. Bill Buckner, a U.S. military spokesman.
In Fadhil, anger mounted against the American military. Awakening fighters said they felt betrayed for the support role the U.S. troops played in Mashhadani's arrest.
By Saturday night, U.S. armored vehicles patrolled the streets; others were positioned at entrances to the neighborhoods. American snipers flashed green laser lights at approaching vehicles signaling them to turn around.
Abu Mirna said it is too early to decide whether the fighters would break off their alliance with the U.S. military. But it was clear their relationship had been tainted by Mashhadani's arrest and Saturday's clashes.
"The American forces do not have credibility with us," Abu Mirna said. "They fought the Fadhil people. We used to call the American forces 'the friendly forces.' What they have done today was unexpected. What happened today will affect the trust between other Awakening groups and the Americans."
"If they don't release Adil Mashhadani, all the Awakening in Iraq will rise up like our uprising today," he added.
The reaction from other Awakening leaders across Baghdad was mixed. In the former Sunni insurgent haven of Dora, Ali Hussain Hafidh, an Awakening commander, said he was alarmed by the sight of four U.S. Humvees on his street. "I said to myself, 'They must have arrived to arrest me,' " he said. "We always feel worried about our usual enemies such as Al Qaeda and the Shiite militias. Now, we have to add the Americans and the Iraqi government to our worries."
Afghanistan's Karzai Endorses Obama Plan
Afghanistan's Karzai Endorses Obama Plan
By Pamela Constable
Copyright by The Washington Post
Sunday, March 29, 2009; Page A10
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/28/AR2009032801727.html?hpid=topnews
KABUL, March 28 -- Afghan President Hamid Karzai said Saturday that he was in "full agreement" with President Obama's newly announced strategy for Afghanistan, saying it was "exactly what the Afghan people were hoping for" and promising to "work very closely" with the United States to implement the plan.
After months of tension between the Afghan leader and officials in Washington, especially over civilian casualties caused by Western military forces, Karzai seemed pleasantly surprised by Obama's prescriptions for Afghanistan's problems, calling his plan "better than we were expecting."
Like a cross-section of Afghans interviewed Saturday, Karzai said he was especially glad that Obama explicitly endorsed two ideas Afghan officials have been stressing for several years: that the fight against Islamist terrorism must focus on militant safe havens in next-door Pakistan and that negotiations with Taliban insurgents are essential to ending the conflict in Afghanistan.
Afghan and U.S.-led coalition forces have been fighting a revived Taliban insurgency for several years but making little headway, while across the border in Pakistan, other extreme Islamist groups have been making steady inroads from isolated tribal zones along the border into Pakistani society, using a mixture of violent intimidation and religious influence.
Obama's strategy calls for a major expansion of Afghan security forces and the deployment of 4,000 new U.S. troops to train them, on top of an additional 17,000 combat troops. It also proposes a boost in U.S. civilian expert assistance, more economic aid to Pakistan in return for stronger action against Islamist militant groups, and support for a better-run, more honest and responsive Afghan government as part of an overarching focus on fighting terrorism in the region.
Pakistani President Asif Ali Zardari also praised Obama's plan, telling members of Parliament in Islamabad on Saturday that it "represents a positive change" in U.S. policy. He specifically endorsed Obama's proposal to devote large amounts of aid to development in Pakistan's lawless border region as an antidote to Islamist extremism.
Zardari said Pakistan would deal "firmly" with groups that seek to harm the government but did not elaborate. The Obama plan would toughen conditions for U.S. economic aid, making it conditional on a stepped-up commitment by Pakistan to fighting Islamist terrorism within its borders.
Afghans interviewed Saturday in markets, on university campuses and in offices in Kabul, the capital, said they were grateful that Obama had recognized the role of Pakistan as a sanctuary for Islamist terrorism yet pleased that he had endorsed the idea of seeking reconciliation with the Taliban, calling this the only sensible way to make peace with their fellow Muslims.
"The American government has finally realized the threat that comes from our neighbor. We welcome that," said Enayatullah Balegh, an influential cleric and Islamic law professor. Negotiating with the Taliban, he added, is "the only way to bring peace and stability. We cannot defeat them when we have foreigners bombing our villages and raiding our homes. Once we solve things with the Afghan fighters, the al-Qaeda forces will go away on their own."
It was not clear, however, whether Afghan and U.S. officials would agree on which adversaries to approach. Karzai said Saturday that he seeks dialogue with Afghan Taliban leaders who are not part of al-Qaeda. He said some should be removed from a U.N. blacklist, but he did not name them. Obama said there should be no talks with an "uncompromising core" of Taliban hard-liners, including the fugitive leader Mohammad Omar.
Political leaders here expressed overall appreciation for Obama's new focus on Afghanistan but said they had concerns about various details or omissions in the plan. Several said they worried that an emphasis on building democracy in their country was being subordinated to the international war against terrorism.
"I was excited that he had a new strategy but not totally satisfied with the result," said Shukria Barakzai, a member of parliament. "In some ways, it seems like a continuation of President Bush's policies. Is he just going to put pressure on the Pakistani executive, or on the army and the intelligence agencies and other groups? There is a much larger picture there."
Despite Zardari's call for more cooperation with Washington against Islamist violence and extremism, U.S. and Afghan officials suspect some elements in the Pakistani security services support the Taliban insurgents and seek to dominate Afghanistan as a counterweight to India, Pakistan's longtime adversary and neighbor.
Like Balegh, some Afghans said they remained suspicious of U.S. intentions in their country and angry about reports of civilian casualties at the hands of foreign troops. They said that the greater the number of U.S. forces, the more likelihood there will be of further abuses, confrontations and mistaken deaths, and that they wished Obama had addressed that problem.
But others said Obama's new approach had generated hope for their future and that he seemed to identify with their problems far more than Bush, who they said was concerned only with fighting al-Qaeda at Afghanistan's expense.
"President Obama is a good man, and he knows how much we have suffered," said furniture salesman Mohammed Najibullah, 40. "This country needs security, jobs, investment, so many things. If Mr. Obama can follow through with all he has promised, he will have a special place in Afghan hearts."
By Pamela Constable
Copyright by The Washington Post
Sunday, March 29, 2009; Page A10
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/28/AR2009032801727.html?hpid=topnews
KABUL, March 28 -- Afghan President Hamid Karzai said Saturday that he was in "full agreement" with President Obama's newly announced strategy for Afghanistan, saying it was "exactly what the Afghan people were hoping for" and promising to "work very closely" with the United States to implement the plan.
After months of tension between the Afghan leader and officials in Washington, especially over civilian casualties caused by Western military forces, Karzai seemed pleasantly surprised by Obama's prescriptions for Afghanistan's problems, calling his plan "better than we were expecting."
Like a cross-section of Afghans interviewed Saturday, Karzai said he was especially glad that Obama explicitly endorsed two ideas Afghan officials have been stressing for several years: that the fight against Islamist terrorism must focus on militant safe havens in next-door Pakistan and that negotiations with Taliban insurgents are essential to ending the conflict in Afghanistan.
Afghan and U.S.-led coalition forces have been fighting a revived Taliban insurgency for several years but making little headway, while across the border in Pakistan, other extreme Islamist groups have been making steady inroads from isolated tribal zones along the border into Pakistani society, using a mixture of violent intimidation and religious influence.
Obama's strategy calls for a major expansion of Afghan security forces and the deployment of 4,000 new U.S. troops to train them, on top of an additional 17,000 combat troops. It also proposes a boost in U.S. civilian expert assistance, more economic aid to Pakistan in return for stronger action against Islamist militant groups, and support for a better-run, more honest and responsive Afghan government as part of an overarching focus on fighting terrorism in the region.
Pakistani President Asif Ali Zardari also praised Obama's plan, telling members of Parliament in Islamabad on Saturday that it "represents a positive change" in U.S. policy. He specifically endorsed Obama's proposal to devote large amounts of aid to development in Pakistan's lawless border region as an antidote to Islamist extremism.
Zardari said Pakistan would deal "firmly" with groups that seek to harm the government but did not elaborate. The Obama plan would toughen conditions for U.S. economic aid, making it conditional on a stepped-up commitment by Pakistan to fighting Islamist terrorism within its borders.
Afghans interviewed Saturday in markets, on university campuses and in offices in Kabul, the capital, said they were grateful that Obama had recognized the role of Pakistan as a sanctuary for Islamist terrorism yet pleased that he had endorsed the idea of seeking reconciliation with the Taliban, calling this the only sensible way to make peace with their fellow Muslims.
"The American government has finally realized the threat that comes from our neighbor. We welcome that," said Enayatullah Balegh, an influential cleric and Islamic law professor. Negotiating with the Taliban, he added, is "the only way to bring peace and stability. We cannot defeat them when we have foreigners bombing our villages and raiding our homes. Once we solve things with the Afghan fighters, the al-Qaeda forces will go away on their own."
It was not clear, however, whether Afghan and U.S. officials would agree on which adversaries to approach. Karzai said Saturday that he seeks dialogue with Afghan Taliban leaders who are not part of al-Qaeda. He said some should be removed from a U.N. blacklist, but he did not name them. Obama said there should be no talks with an "uncompromising core" of Taliban hard-liners, including the fugitive leader Mohammad Omar.
Political leaders here expressed overall appreciation for Obama's new focus on Afghanistan but said they had concerns about various details or omissions in the plan. Several said they worried that an emphasis on building democracy in their country was being subordinated to the international war against terrorism.
"I was excited that he had a new strategy but not totally satisfied with the result," said Shukria Barakzai, a member of parliament. "In some ways, it seems like a continuation of President Bush's policies. Is he just going to put pressure on the Pakistani executive, or on the army and the intelligence agencies and other groups? There is a much larger picture there."
Despite Zardari's call for more cooperation with Washington against Islamist violence and extremism, U.S. and Afghan officials suspect some elements in the Pakistani security services support the Taliban insurgents and seek to dominate Afghanistan as a counterweight to India, Pakistan's longtime adversary and neighbor.
Like Balegh, some Afghans said they remained suspicious of U.S. intentions in their country and angry about reports of civilian casualties at the hands of foreign troops. They said that the greater the number of U.S. forces, the more likelihood there will be of further abuses, confrontations and mistaken deaths, and that they wished Obama had addressed that problem.
But others said Obama's new approach had generated hope for their future and that he seemed to identify with their problems far more than Bush, who they said was concerned only with fighting al-Qaeda at Afghanistan's expense.
"President Obama is a good man, and he knows how much we have suffered," said furniture salesman Mohammed Najibullah, 40. "This country needs security, jobs, investment, so many things. If Mr. Obama can follow through with all he has promised, he will have a special place in Afghan hearts."
New York Times Editorial: Questions for Reform
New York Times Editorial: Questions for Reform
Copyright by tHe New York Times
Published: March 28, 2009
http://www.nytimes.com/2009/03/29/opinion/29sun1.html?_r=1&ref=opinion
Treasury Secretary Timothy Geithner sounded the right notes last week when he presented a first draft of the administration’s plan to reform the financial system. He said the system had failed “in fundamental ways” and would require comprehensive overhaul. “Not modest repairs at the margin,” he told Congress, “but new rules of the game.”
It is too early to say whether a fleshed-out proposal — and what Congress eventually passes — will amount to a game changer. Some of Mr. Geithner’s proposals do appear aimed at limiting dangers that have lurked for too long in dark corners of the markets. Others may simply preserve Wall Street’s prerogative to party on once the current storm has passed.
For instance, Mr. Geithner called for all large hedge funds and private equity firms to register with the Securities and Exchange Commission, a move that could bring much-needed disclosure and oversight to vast pools of capital that fed the bubble economy. But the S.E.C. would not have the full authority to resolve all concerns. Rather, it would report its findings up what could turn out to be a convoluted chain of regulatory command.
Similarly, Mr. Geithner called for oversight of unregulated derivatives, like the credit default swaps at the heart of the debacle at American International Group. But he made a troubling distinction between “standardized” derivatives and “non-standardized” ones, and proposed different regulation for each. That looks like a loophole disguised as a new rule. Derivatives, now swapped one-on-one, ad infinitum across the financial system, need to be traded on a fully regulated exchange, period.
A dual system would close off some activities, but would also invite a variation on the regulator shopping that Mr. Geithner said he wanted to stop.
The real tension in Mr. Geithner’s presentation was in what went unsaid. His proposals can serve as the basis to start a reform discussion. But there are big underlying issues that Congress and the administration should keep in mind. Here are three that concern us now:
Is too big to fail too big to exist? The notion of institutions “too big to fail” is shorthand for firms whose collapse would endanger the entire financial system. It is not just a matter of size. Such firms, like A.I.G., have proved dangerous mainly because of their involvement in a web of often conflicting financial practices and products. The A.I.G. financial unit that sold credit default swaps did not have the wherewithal to make good on its obligations, but leeched off the AAA rating of the company’s strong insurance business.
Of all the proposals Mr. Geithner laid out this week, the most far-reaching pertain to such systemically important firms. He called for a single powerful regulator to police the most powerful institutions, presumably intervening to require more capital whenever sheer size and conflicting activities appear threatening. In the all-too-likely event that firms would get too big to fail anyway, he called for new government powers to seize and restructure them, if failure seemed imminent. No one disputes that this authority is needed in today’s world to avoid calamitous bankruptcies and bailouts. The aim would be to make such takeovers as orderly as a bank seizure by the Federal Deposit Insurance Corporation.
The important question, however, is whether, in a reformed future, any firm should even come close to getting too big — too diverse, too interconnected — to fail.
Mr. Geithner’s plan assumes that such firms will be a feature of the financial landscape going forward. That is a radical shift in perspective. Depression-era legislation, after all, prevented financial firms from mixing commercial banking with investment banking and insurance. Only in the last 10 years — with the passage in 1999 of the Gramm-Leach-Bliley Act — have such financial supermarkets been allowed to re-emerge.
Supporters of Gramm-Leach-Bliley recognized that too-big-to-fail firms posed a risk of taxpayer bailouts. Their concerns were soothed by a belief that market discipline, combined with innovative ways to reduce risk — namely derivatives like credit default swaps — would mitigate the danger. We now know that discipline failed and the innovations actually amplified risk greatly.
In some cases, these big firms allowed ever more financial risk to be piled on ever-thinner cushions of capital. That helped to juice Wall Street profits, but did it really outweigh the disadvantages that are now so painfully evident in taxpayer-funded bailouts?
If there is no proven way to reduce the systemic risk in big and interconnected firms, why should they be allowed to exist? It would take some time to dismantle them, so the government should, in the meantime, be granted the resolution authority to seize them if needed. But that should not substitute for a debate on whether such firms should be allowed to exist at all.
What are we trying to fix, anyway? The urgency to repair the financial system is mainly political. Crises create intense public awareness and with it, the opportunity for change that reform-minded officials do not want to squander. Even lawmakers who would prefer the status quo feel the pressure to act.
But does anyone understand with specificity what brought on the financial meltdown? Can the lawmakers and other officials charged with writing the new rules explain the transactions, interactions, norms, products and relationships that got us in this mess? Can anyone parse how much of the crisis is due to regulatory failure, how much to recklessness and greed, how much to fraud and manipulation? Why, exactly, did Goldman Sachs get $12.9 billion in the A.I.G. bailout?
Without the answers, which we do not yet have, Congress and the administration cannot be confident that they are coming up with the right reforms.
It is clear, however, that there is bipartisan resistance to a thorough investigation of what caused the collapse. There have been hearings galore. But they are often little more than hazings of corporate executives and government officials. Even the illuminating hearings have not been connected in a meaningful way that will help us all understand what went wrong.
Without an investigation, the reform effort will be at best, hit or miss, and at worst, a charade. Congress should start now to gear up for an investigation, using as its model the 1930s Pecora inquiry into the stock market crash, or the Watergate hearings of the 1970s. The investigation should not be performed by outside experts, like the 9/11 commission, whose report Congress is free to accept or reject. It should be part of the Congressional process and include an investigator with subpoena power and the right to participate in the questioning of witnesses, as well as to prep lawmakers for the hearings.
A real investigation might serve as a channel for the public anger now used by politicians to score quick populist points on television without tackling the real issues.
Who is to carry out the reforms? Any serious call for reform has to acknowledge the severe institutional damage that has been done to the nation’s regulatory agencies. For 30 years, the political tide in this country has run against regulation and for deregulation. In the last 10 years, opponents of financial regulation have been especially successful in dismantling and undermining regulation — putting their faith and the nation’s future in the hands of a market discipline that turned out not to exist and can’t-miss financial products that missed, big.
There is not an agency that has not suffered a diminution of expertise or reputation.
Recent examples include the Federal Reserve’s repeated failures to use its consumer-protection authority to stop unfair mortgage lending; the Securities and Exchange Commission’s failure to heed repeated warnings about the Madoff Ponzi scheme; the efforts by the Office of the Comptroller of the Currency, a bank regulator, to block state regulators’ efforts to police lending violations; and the utter failure of the Office of Thrift Supervision, A.I.G’s federal regulator, to understand — or, even worse, care about — what was going on at that company.
Unfortunately, there are many, many more examples. Advocates of deregulation point to the failures as evidence that the government has no intrinsic ability to police markets. That is incorrect. The nation’s regulatory agencies have been allowed to languish, underfunded, understaffed — and too often headed by political appointees who are true believers only in the dogma of deregulation and not in their agencies’ missions.
If the United States is going to have meaningful reform of its out-of-control financial system, new rules will only be a first step.
Copyright by tHe New York Times
Published: March 28, 2009
http://www.nytimes.com/2009/03/29/opinion/29sun1.html?_r=1&ref=opinion
Treasury Secretary Timothy Geithner sounded the right notes last week when he presented a first draft of the administration’s plan to reform the financial system. He said the system had failed “in fundamental ways” and would require comprehensive overhaul. “Not modest repairs at the margin,” he told Congress, “but new rules of the game.”
It is too early to say whether a fleshed-out proposal — and what Congress eventually passes — will amount to a game changer. Some of Mr. Geithner’s proposals do appear aimed at limiting dangers that have lurked for too long in dark corners of the markets. Others may simply preserve Wall Street’s prerogative to party on once the current storm has passed.
For instance, Mr. Geithner called for all large hedge funds and private equity firms to register with the Securities and Exchange Commission, a move that could bring much-needed disclosure and oversight to vast pools of capital that fed the bubble economy. But the S.E.C. would not have the full authority to resolve all concerns. Rather, it would report its findings up what could turn out to be a convoluted chain of regulatory command.
Similarly, Mr. Geithner called for oversight of unregulated derivatives, like the credit default swaps at the heart of the debacle at American International Group. But he made a troubling distinction between “standardized” derivatives and “non-standardized” ones, and proposed different regulation for each. That looks like a loophole disguised as a new rule. Derivatives, now swapped one-on-one, ad infinitum across the financial system, need to be traded on a fully regulated exchange, period.
A dual system would close off some activities, but would also invite a variation on the regulator shopping that Mr. Geithner said he wanted to stop.
The real tension in Mr. Geithner’s presentation was in what went unsaid. His proposals can serve as the basis to start a reform discussion. But there are big underlying issues that Congress and the administration should keep in mind. Here are three that concern us now:
Is too big to fail too big to exist? The notion of institutions “too big to fail” is shorthand for firms whose collapse would endanger the entire financial system. It is not just a matter of size. Such firms, like A.I.G., have proved dangerous mainly because of their involvement in a web of often conflicting financial practices and products. The A.I.G. financial unit that sold credit default swaps did not have the wherewithal to make good on its obligations, but leeched off the AAA rating of the company’s strong insurance business.
Of all the proposals Mr. Geithner laid out this week, the most far-reaching pertain to such systemically important firms. He called for a single powerful regulator to police the most powerful institutions, presumably intervening to require more capital whenever sheer size and conflicting activities appear threatening. In the all-too-likely event that firms would get too big to fail anyway, he called for new government powers to seize and restructure them, if failure seemed imminent. No one disputes that this authority is needed in today’s world to avoid calamitous bankruptcies and bailouts. The aim would be to make such takeovers as orderly as a bank seizure by the Federal Deposit Insurance Corporation.
The important question, however, is whether, in a reformed future, any firm should even come close to getting too big — too diverse, too interconnected — to fail.
Mr. Geithner’s plan assumes that such firms will be a feature of the financial landscape going forward. That is a radical shift in perspective. Depression-era legislation, after all, prevented financial firms from mixing commercial banking with investment banking and insurance. Only in the last 10 years — with the passage in 1999 of the Gramm-Leach-Bliley Act — have such financial supermarkets been allowed to re-emerge.
Supporters of Gramm-Leach-Bliley recognized that too-big-to-fail firms posed a risk of taxpayer bailouts. Their concerns were soothed by a belief that market discipline, combined with innovative ways to reduce risk — namely derivatives like credit default swaps — would mitigate the danger. We now know that discipline failed and the innovations actually amplified risk greatly.
In some cases, these big firms allowed ever more financial risk to be piled on ever-thinner cushions of capital. That helped to juice Wall Street profits, but did it really outweigh the disadvantages that are now so painfully evident in taxpayer-funded bailouts?
If there is no proven way to reduce the systemic risk in big and interconnected firms, why should they be allowed to exist? It would take some time to dismantle them, so the government should, in the meantime, be granted the resolution authority to seize them if needed. But that should not substitute for a debate on whether such firms should be allowed to exist at all.
What are we trying to fix, anyway? The urgency to repair the financial system is mainly political. Crises create intense public awareness and with it, the opportunity for change that reform-minded officials do not want to squander. Even lawmakers who would prefer the status quo feel the pressure to act.
But does anyone understand with specificity what brought on the financial meltdown? Can the lawmakers and other officials charged with writing the new rules explain the transactions, interactions, norms, products and relationships that got us in this mess? Can anyone parse how much of the crisis is due to regulatory failure, how much to recklessness and greed, how much to fraud and manipulation? Why, exactly, did Goldman Sachs get $12.9 billion in the A.I.G. bailout?
Without the answers, which we do not yet have, Congress and the administration cannot be confident that they are coming up with the right reforms.
It is clear, however, that there is bipartisan resistance to a thorough investigation of what caused the collapse. There have been hearings galore. But they are often little more than hazings of corporate executives and government officials. Even the illuminating hearings have not been connected in a meaningful way that will help us all understand what went wrong.
Without an investigation, the reform effort will be at best, hit or miss, and at worst, a charade. Congress should start now to gear up for an investigation, using as its model the 1930s Pecora inquiry into the stock market crash, or the Watergate hearings of the 1970s. The investigation should not be performed by outside experts, like the 9/11 commission, whose report Congress is free to accept or reject. It should be part of the Congressional process and include an investigator with subpoena power and the right to participate in the questioning of witnesses, as well as to prep lawmakers for the hearings.
A real investigation might serve as a channel for the public anger now used by politicians to score quick populist points on television without tackling the real issues.
Who is to carry out the reforms? Any serious call for reform has to acknowledge the severe institutional damage that has been done to the nation’s regulatory agencies. For 30 years, the political tide in this country has run against regulation and for deregulation. In the last 10 years, opponents of financial regulation have been especially successful in dismantling and undermining regulation — putting their faith and the nation’s future in the hands of a market discipline that turned out not to exist and can’t-miss financial products that missed, big.
There is not an agency that has not suffered a diminution of expertise or reputation.
Recent examples include the Federal Reserve’s repeated failures to use its consumer-protection authority to stop unfair mortgage lending; the Securities and Exchange Commission’s failure to heed repeated warnings about the Madoff Ponzi scheme; the efforts by the Office of the Comptroller of the Currency, a bank regulator, to block state regulators’ efforts to police lending violations; and the utter failure of the Office of Thrift Supervision, A.I.G’s federal regulator, to understand — or, even worse, care about — what was going on at that company.
Unfortunately, there are many, many more examples. Advocates of deregulation point to the failures as evidence that the government has no intrinsic ability to police markets. That is incorrect. The nation’s regulatory agencies have been allowed to languish, underfunded, understaffed — and too often headed by political appointees who are true believers only in the dogma of deregulation and not in their agencies’ missions.
If the United States is going to have meaningful reform of its out-of-control financial system, new rules will only be a first step.
Spanish Court Weighs Inquiry on Torture for 6 Bush-Era Officials
Spanish Court Weighs Inquiry on Torture for 6 Bush-Era Officials
By MARLISE SIMONS
Copyright by The New York Times
Published: March 28, 2009
http://www.nytimes.com/2009/03/29/world/europe/29spain.html?_r=1&th&emc=th
LONDON — A Spanish court has taken the first steps toward opening a criminal investigation into allegations that six former high-level Bush administration officials violated international law by providing the legal framework to justify the torture of prisoners at Guantánamo Bay, Cuba, an official close to the case said.
The case, against former Attorney General Alberto R. Gonzales and others, was sent to the prosecutor’s office for review by Baltasar Garzón, the crusading investigative judge who ordered the arrest of the former Chilean dictator Augusto Pinochet. The official said that it was “highly probable” that the case would go forward and that it could lead to arrest warrants.
The move represents a step toward ascertaining the legal accountability of top Bush administration officials for allegations of torture and mistreatment of prisoners in the campaign against terrorism. But some American experts said that even if warrants were issued their significance could be more symbolic than practical, and that it was a near certainty that the warrants would not lead to arrests if the officials did not leave the United States.
The complaint under review also names John C. Yoo, the former Justice Department lawyer who wrote secret legal opinions saying the president had the authority to circumvent the Geneva Conventions, and Douglas J. Feith, the former under secretary of defense for policy.
Most of the officials cited in the complaint declined to comment on the allegations or could not be reached on Saturday. However their defenders have said their legal analyses and policy work on interrogation practices, conducted under great pressure after the 2001 terrorist attacks, are now being unfairly second-guessed after many years without a terrorist attack on the United States.
The court case was not entirely unexpected, as several human rights groups have been asking judges in different countries to indict Bush administration officials. One group, the Center for Constitutional Rights, had asked a German prosecutor for such an indictment, but the prosecutor declined.
Judge Garzón, however, has built an international reputation by bringing high-profile cases against human rights violators as well as international terrorist networks like Al Qaeda. The arrest warrant for General Pinochet led to his detention in Britain, although he never faced a trial. The judge has also been outspoken about the treatment of detainees at Guantánamo Bay.
Spain can claim jurisdiction in the case because five citizens or residents of Spain who were prisoners at Guantánamo Bay have said they were tortured there. The five had been indicted in Spain, but their cases were dismissed after the Spanish Supreme Court ruled that evidence obtained under torture was not admissible.
The 98-page complaint, a copy of which was obtained by The New York Times, is based on the Geneva Conventions and the 1984 Convention Against Torture, which is binding on 145 countries, including Spain and the United States. Countries that are party to the torture convention have the authority to investigate torture cases, especially when a citizen has been abused.
The complaint was prepared by Spanish lawyers, with help from experts in the United States and Europe, and filed by a Spanish human rights group, the Association for the Dignity of Prisoners.
The National Court in Madrid, which specializes in international crimes, assigned the case to Judge Garzón. His acceptance of the case and referral of it to the prosecutor made it likely that a criminal investigation would follow, the official said.
Even so, arrest warrants, if they are issued, would still be months away.
Gonzalo Boye, the Madrid lawyer who filed the complaint, said that the six Americans cited had had well-documented roles in approving illegal interrogation techniques, redefining torture and abandoning the definition set by the 1984 Torture Convention.
Secret memorandums by Mr. Yoo and other top administration lawyers helped clear the way for aggressive policies like waterboarding and other harsh interrogation techniques, which the C.I.A. director, the attorney general and other American officials have said amount to torture.
The other Americans named in the complaint were William J. Haynes II, former general counsel for the Department of Defense; Jay S. Bybee, Mr. Yoo’s former boss at the Justice Department’s Office of Legal Counsel; and David S. Addington, who was the chief of staff and legal adviser to Vice President Dick Cheney.
Mr. Yoo declined to comment on Saturday, saying that he had not seen or heard of the petition.
Mr. Feith, who was the top policy official at the Pentagon when the prison at Guantánamo was established, said he did not make the decision on interrogation methods and was baffled by the allegations. “I didn’t even argue for the thing I understand they’re objecting to,” he said.
But Mr. Boye said that lawyers should be held accountable for the effects of their work. Noting that the association he represents includes many lawyers, he said: “This is a case from lawyers against lawyers. Our profession does not allow us to misuse our legal knowledge to create a pseudo-legal frame to justify, stimulate and cover up torture.”
Prosecutions and convictions under the Torture Convention have been rare.
Reed Brody, a lawyer at Human Rights Watch who has specialized in this issue, said that even though torture was widely practiced, there were numerous obstacles, including “a lack of political will, the problem of gathering evidence in a foreign country and the failure of countries to pass the necessary laws.”
This year for the first time, the United States used a law that allows it to prosecute torture in other countries. On Jan. 10, a federal court in Miami sentenced Chuckie Taylor, the son of the former Liberian president, to 97 years in a federal prison for torture, even though the crimes were committed in Liberia.
Last October, when the Miami court handed down the conviction, Attorney General Michael B. Mukasey applauded the ruling and said: “This is the first case in the United States to charge an individual with criminal torture. I hope this case will serve as a model to future prosecutions of this type.”
The United States, however, would be expected to ignore an extradition request for former officials, although other investigations within the United States have been proposed. Calls for the Justice Department to open a criminal investigation have so far been resisted by the Obama administration, but for more than four years, the Justice Department ethics office has been conducting its own investigation into the work of Mr. Yoo and some of his colleagues.
While the officials named in the complaint have not addressed these specific accusations, Mr. Yoo defended his work in an opinion column in The Wall Street Journal on March 7, warning that the Obama administration risked harming national security if it punished lawyers like himself.
“If the administration chooses to seriously pursue those officials who were charged with preparing for the unthinkable, today’s intelligence and military officials will no doubt hesitate to fully prepare for those contingencies in the future,” Mr. Yoo wrote.
Scott Shane and Eric Schmitt contributed reporting from Washington.
By MARLISE SIMONS
Copyright by The New York Times
Published: March 28, 2009
http://www.nytimes.com/2009/03/29/world/europe/29spain.html?_r=1&th&emc=th
LONDON — A Spanish court has taken the first steps toward opening a criminal investigation into allegations that six former high-level Bush administration officials violated international law by providing the legal framework to justify the torture of prisoners at Guantánamo Bay, Cuba, an official close to the case said.
The case, against former Attorney General Alberto R. Gonzales and others, was sent to the prosecutor’s office for review by Baltasar Garzón, the crusading investigative judge who ordered the arrest of the former Chilean dictator Augusto Pinochet. The official said that it was “highly probable” that the case would go forward and that it could lead to arrest warrants.
The move represents a step toward ascertaining the legal accountability of top Bush administration officials for allegations of torture and mistreatment of prisoners in the campaign against terrorism. But some American experts said that even if warrants were issued their significance could be more symbolic than practical, and that it was a near certainty that the warrants would not lead to arrests if the officials did not leave the United States.
The complaint under review also names John C. Yoo, the former Justice Department lawyer who wrote secret legal opinions saying the president had the authority to circumvent the Geneva Conventions, and Douglas J. Feith, the former under secretary of defense for policy.
Most of the officials cited in the complaint declined to comment on the allegations or could not be reached on Saturday. However their defenders have said their legal analyses and policy work on interrogation practices, conducted under great pressure after the 2001 terrorist attacks, are now being unfairly second-guessed after many years without a terrorist attack on the United States.
The court case was not entirely unexpected, as several human rights groups have been asking judges in different countries to indict Bush administration officials. One group, the Center for Constitutional Rights, had asked a German prosecutor for such an indictment, but the prosecutor declined.
Judge Garzón, however, has built an international reputation by bringing high-profile cases against human rights violators as well as international terrorist networks like Al Qaeda. The arrest warrant for General Pinochet led to his detention in Britain, although he never faced a trial. The judge has also been outspoken about the treatment of detainees at Guantánamo Bay.
Spain can claim jurisdiction in the case because five citizens or residents of Spain who were prisoners at Guantánamo Bay have said they were tortured there. The five had been indicted in Spain, but their cases were dismissed after the Spanish Supreme Court ruled that evidence obtained under torture was not admissible.
The 98-page complaint, a copy of which was obtained by The New York Times, is based on the Geneva Conventions and the 1984 Convention Against Torture, which is binding on 145 countries, including Spain and the United States. Countries that are party to the torture convention have the authority to investigate torture cases, especially when a citizen has been abused.
The complaint was prepared by Spanish lawyers, with help from experts in the United States and Europe, and filed by a Spanish human rights group, the Association for the Dignity of Prisoners.
The National Court in Madrid, which specializes in international crimes, assigned the case to Judge Garzón. His acceptance of the case and referral of it to the prosecutor made it likely that a criminal investigation would follow, the official said.
Even so, arrest warrants, if they are issued, would still be months away.
Gonzalo Boye, the Madrid lawyer who filed the complaint, said that the six Americans cited had had well-documented roles in approving illegal interrogation techniques, redefining torture and abandoning the definition set by the 1984 Torture Convention.
Secret memorandums by Mr. Yoo and other top administration lawyers helped clear the way for aggressive policies like waterboarding and other harsh interrogation techniques, which the C.I.A. director, the attorney general and other American officials have said amount to torture.
The other Americans named in the complaint were William J. Haynes II, former general counsel for the Department of Defense; Jay S. Bybee, Mr. Yoo’s former boss at the Justice Department’s Office of Legal Counsel; and David S. Addington, who was the chief of staff and legal adviser to Vice President Dick Cheney.
Mr. Yoo declined to comment on Saturday, saying that he had not seen or heard of the petition.
Mr. Feith, who was the top policy official at the Pentagon when the prison at Guantánamo was established, said he did not make the decision on interrogation methods and was baffled by the allegations. “I didn’t even argue for the thing I understand they’re objecting to,” he said.
But Mr. Boye said that lawyers should be held accountable for the effects of their work. Noting that the association he represents includes many lawyers, he said: “This is a case from lawyers against lawyers. Our profession does not allow us to misuse our legal knowledge to create a pseudo-legal frame to justify, stimulate and cover up torture.”
Prosecutions and convictions under the Torture Convention have been rare.
Reed Brody, a lawyer at Human Rights Watch who has specialized in this issue, said that even though torture was widely practiced, there were numerous obstacles, including “a lack of political will, the problem of gathering evidence in a foreign country and the failure of countries to pass the necessary laws.”
This year for the first time, the United States used a law that allows it to prosecute torture in other countries. On Jan. 10, a federal court in Miami sentenced Chuckie Taylor, the son of the former Liberian president, to 97 years in a federal prison for torture, even though the crimes were committed in Liberia.
Last October, when the Miami court handed down the conviction, Attorney General Michael B. Mukasey applauded the ruling and said: “This is the first case in the United States to charge an individual with criminal torture. I hope this case will serve as a model to future prosecutions of this type.”
The United States, however, would be expected to ignore an extradition request for former officials, although other investigations within the United States have been proposed. Calls for the Justice Department to open a criminal investigation have so far been resisted by the Obama administration, but for more than four years, the Justice Department ethics office has been conducting its own investigation into the work of Mr. Yoo and some of his colleagues.
While the officials named in the complaint have not addressed these specific accusations, Mr. Yoo defended his work in an opinion column in The Wall Street Journal on March 7, warning that the Obama administration risked harming national security if it punished lawyers like himself.
“If the administration chooses to seriously pursue those officials who were charged with preparing for the unthinkable, today’s intelligence and military officials will no doubt hesitate to fully prepare for those contingencies in the future,” Mr. Yoo wrote.
Scott Shane and Eric Schmitt contributed reporting from Washington.
Saturday, March 28, 2009
Here is the Washington Post's Mensa Invitational
Here is the Washington Post's Mensa Invitational which once again asked readers to take any word from the dictionary, alter it by adding, subtracting, or changing one letter, and supply a new definition
Here are the winners:
1. Cashtration (n.): The act of buying a house, which renders the subject financially impotent for an indefinite period of time.
2. Ignoranus : A person who's both stupid and an asshole.
3. Intaxicaton : Euphoria at getting a tax refund, which lasts until you realize it was your money to start with.
4. Reintarnation : Coming back to life as a hillbilly.
5. Bozone ( n.): The substance surrounding stupid people that stops bright ideas from penetrating. The bozone layer, unfortunately, shows little sign of breaking down in the near future.
6. Foreploy : Any misrepresentation about yourself for the purpose of getting laid.
7. Giraffiti : Vandalism spray-painted very, very high
8. Sarchasm : The gulf between the author of sarcastic wit and the person who doesn't get it.
9. Inoculatte : To take coffee intravenously when you are running late.
10. Osteopornosis : A degenerate disease. (This one got extra credit.)
11. Karmageddon : It's like, when everybody is sending off all these really bad vibes, right? And then, like, the Earth explodes and it's like, a serious bummer.
12. Decafalon (n.): The gruelling event of getting through the day consuming only things that are good for you.
13. Glibido : All talk and no action.
14. Dopeler Effect: The tendency of stupid ideas to seem smarter when they come at you rapidly.
15. Arachnoleptic Fit (n.): The frantic dance performed just after you've accidentally walked through a spider web.
16. Beelzebug (n.) : Satan in the form of a mosquito, that gets into your bedroom at three in the morning and cannot be cast out.
17. Caterpallor ( n.): The color you turn after finding half a worm in the fruit you're eating.
The Washington Post has also published the winning submissions to its yearly contest, in which readers are asked to supply alternate meanings for common words.
And the winners are:
1. Coffee , n. The person upon whom one coughs.
2. Flabbergasted , adj. Appalled by discovering how much weight one has gained.
3. Abdicate , v. To give up all hope of ever having a flat stomach.
4. Esplanade , v. To attempt an explanation while drunk.
5. Willy-nilly , adj. Impotent.
6. Negligent , adj. Absentmindedly answering the door when wearing only a nightgown.
7. Lymph , v. To walk with a lisp.
8. Gargoyle , n. Olive-flavored mouthwash.
9. Flatulence , n. Emergency vehicle that picks up someone who has been run over by a steamroller.
10. Balderdash , n. A rapidly receding hairline.
11. Testicle , n. A humorous question on an exam.
12. Rectitude , n. The formal, dignified bearing adopted by proctologists.
13. Pokemon , n.. A Rastafarian proctologist.
14. Oyster , n. A person who sprinkles his conversation with Yiddishisms.
15. Frisbeetarianism , n. The belief that, after death, the soul flies up onto the roof and gets stuck there.
16. Circumvent , n. An opening in the front of boxer shorts worn by Jewish men.
"The central conservative truth is that it is culture, not politics, that determines the success of a society. The central liberal truth is that politics can change a culture and save it from itself."
- Daniel Patrick Moynihan
Here are the winners:
1. Cashtration (n.): The act of buying a house, which renders the subject financially impotent for an indefinite period of time.
2. Ignoranus : A person who's both stupid and an asshole.
3. Intaxicaton : Euphoria at getting a tax refund, which lasts until you realize it was your money to start with.
4. Reintarnation : Coming back to life as a hillbilly.
5. Bozone ( n.): The substance surrounding stupid people that stops bright ideas from penetrating. The bozone layer, unfortunately, shows little sign of breaking down in the near future.
6. Foreploy : Any misrepresentation about yourself for the purpose of getting laid.
7. Giraffiti : Vandalism spray-painted very, very high
8. Sarchasm : The gulf between the author of sarcastic wit and the person who doesn't get it.
9. Inoculatte : To take coffee intravenously when you are running late.
10. Osteopornosis : A degenerate disease. (This one got extra credit.)
11. Karmageddon : It's like, when everybody is sending off all these really bad vibes, right? And then, like, the Earth explodes and it's like, a serious bummer.
12. Decafalon (n.): The gruelling event of getting through the day consuming only things that are good for you.
13. Glibido : All talk and no action.
14. Dopeler Effect: The tendency of stupid ideas to seem smarter when they come at you rapidly.
15. Arachnoleptic Fit (n.): The frantic dance performed just after you've accidentally walked through a spider web.
16. Beelzebug (n.) : Satan in the form of a mosquito, that gets into your bedroom at three in the morning and cannot be cast out.
17. Caterpallor ( n.): The color you turn after finding half a worm in the fruit you're eating.
The Washington Post has also published the winning submissions to its yearly contest, in which readers are asked to supply alternate meanings for common words.
And the winners are:
1. Coffee , n. The person upon whom one coughs.
2. Flabbergasted , adj. Appalled by discovering how much weight one has gained.
3. Abdicate , v. To give up all hope of ever having a flat stomach.
4. Esplanade , v. To attempt an explanation while drunk.
5. Willy-nilly , adj. Impotent.
6. Negligent , adj. Absentmindedly answering the door when wearing only a nightgown.
7. Lymph , v. To walk with a lisp.
8. Gargoyle , n. Olive-flavored mouthwash.
9. Flatulence , n. Emergency vehicle that picks up someone who has been run over by a steamroller.
10. Balderdash , n. A rapidly receding hairline.
11. Testicle , n. A humorous question on an exam.
12. Rectitude , n. The formal, dignified bearing adopted by proctologists.
13. Pokemon , n.. A Rastafarian proctologist.
14. Oyster , n. A person who sprinkles his conversation with Yiddishisms.
15. Frisbeetarianism , n. The belief that, after death, the soul flies up onto the roof and gets stuck there.
16. Circumvent , n. An opening in the front of boxer shorts worn by Jewish men.
"The central conservative truth is that it is culture, not politics, that determines the success of a society. The central liberal truth is that politics can change a culture and save it from itself."
- Daniel Patrick Moynihan
Drug prices: Wal-Mart/Caterpillar plan may drive down employer health-care costs
Drug prices: Wal-Mart/Caterpillar plan may drive down employer health-care costs - Program with Caterpillar aims to reduce employer health-care costs while increasing traffic to stores
By Sandra M. Jones
Copyright © 2009, Chicago Tribune
March 28, 2009
http://www.chicagotribune.com/business/chi-sat-wal-mart-pharmacy-mar28,0,1451349.story
Diapers. Barbies. Lettuce. Now medicine.
Wal-Mart Stores Inc., the world's largest retailer, is aiming its economic might at the health-care industry with a program that lowers prescription drug prices for employers. A pilot program with Caterpillar Inc. to streamline the way drugs are purchased has shown enough promise that Wal-Mart is in talks with several other firms to do the same, the companies said Friday.
"We hope we will drive down costs for the entire health-care industry," Michael Struhs, director of business development at Wal-Mart, said during a Webcast hosted by the Pharmacy Benefits Management Institute. "That is what we do. We operate efficiently and that allows us to lower costs, and those savings are passed on to our customers."
The discount chain has already shaken up the retailing landscape in recent years, rising to become the biggest seller of apparel, groceries and toys. But it is hungry for more growth and sees a chance to bring its extraordinary size and clout to bear on rising health-care costs.
The Wal-Mart contract waives the $5 co-payment for Caterpillar employees on any generic drugs if they purchase them at a Wal-Mart or Sam's Club pharmacy. By giving workers an incentive to fill prescriptions at Wal-Mart rather than another pharmacy, the retailer not only beefs up its pharmacy business, but also attracts more shoppers into the store, where they might make other purchases.
The most radical aspect of the test, however, is the threat of unraveling how the health-care industry buys and sells prescription drugs.
Under the initiative that began in October, Peoria-based Caterpillar has a contract to buy prescription drugs for employees directly from Wal-Mart and has a third-party audit system in place to make sure that prices aren't inflated.
That process contrasts with the way most employers purchase drugs, through a middleman, known as a pharmacy benefit manager, or PBM. The pricing system is complicated and filled with opportunities for handlers to inflate prices, experts say.
For example, the markup on prescription drugs starts with the average wholesale price, a figure similar to a list price on a car. Caterpillar was fed up with rising health-care costs, said Todd Bisping, pharmacy benefits and informatics manager at the construction- and mining-equipment manufacturer, which estimated there was as much as 20 percent waste in the supply chain that was "not adding value, but just higher prices," he said on the Webcast.
"As I talk to other companies there's a lot of confusion and complexity in this," he said. "And I just think a lot of people don't understand it. The easiest thing to do is look at the number the PBMs spit out. As more and more companies realize we just can't blindly assume what's going on is best for us, they're going to start digging into it and find the same thing."
He said others are examining Caterpillar's program with Wal-Mart.
"I have talked to multiple large companies who called me because they are interested in learning more about this concept," Bisping said.
What Wal-Mart is doing isn't the only way to lower prescription drug prices, said Michael Polzin, spokesman for Deerfield-based Walgreen Co.
"We're going down a similar path by going directly to employers, but we have a more comprehensive offering," he said. Walgreens started a program in January offering lower drug prices, health and wellness clinics, and retail clinics on corporate campuses.
The price Wal-Mart charges Caterpillar for drugs is based on the price it paid the drugmaker, plus a markup for overhead and profit. Caterpillar doesn't know the price Wal-Mart paid the drugmaker but relies on an independent auditor to make sure the retailer begins with the actual price it paid, Bisping said.
Caterpillar declined to disclose how many of its 70,000 employees and retirees are using the program, but the company said it is more than expected. Caterpillar still has a contract with its PBM for the business of handling claims, an arrangement it intends to keep, Bisping said.
Wal-Mart set off a wave of price competition in 2006 when it began offering a range of generic drugs for $4 a month.
smjones@tribune.com
By Sandra M. Jones
Copyright © 2009, Chicago Tribune
March 28, 2009
http://www.chicagotribune.com/business/chi-sat-wal-mart-pharmacy-mar28,0,1451349.story
Diapers. Barbies. Lettuce. Now medicine.
Wal-Mart Stores Inc., the world's largest retailer, is aiming its economic might at the health-care industry with a program that lowers prescription drug prices for employers. A pilot program with Caterpillar Inc. to streamline the way drugs are purchased has shown enough promise that Wal-Mart is in talks with several other firms to do the same, the companies said Friday.
"We hope we will drive down costs for the entire health-care industry," Michael Struhs, director of business development at Wal-Mart, said during a Webcast hosted by the Pharmacy Benefits Management Institute. "That is what we do. We operate efficiently and that allows us to lower costs, and those savings are passed on to our customers."
The discount chain has already shaken up the retailing landscape in recent years, rising to become the biggest seller of apparel, groceries and toys. But it is hungry for more growth and sees a chance to bring its extraordinary size and clout to bear on rising health-care costs.
The Wal-Mart contract waives the $5 co-payment for Caterpillar employees on any generic drugs if they purchase them at a Wal-Mart or Sam's Club pharmacy. By giving workers an incentive to fill prescriptions at Wal-Mart rather than another pharmacy, the retailer not only beefs up its pharmacy business, but also attracts more shoppers into the store, where they might make other purchases.
The most radical aspect of the test, however, is the threat of unraveling how the health-care industry buys and sells prescription drugs.
Under the initiative that began in October, Peoria-based Caterpillar has a contract to buy prescription drugs for employees directly from Wal-Mart and has a third-party audit system in place to make sure that prices aren't inflated.
That process contrasts with the way most employers purchase drugs, through a middleman, known as a pharmacy benefit manager, or PBM. The pricing system is complicated and filled with opportunities for handlers to inflate prices, experts say.
For example, the markup on prescription drugs starts with the average wholesale price, a figure similar to a list price on a car. Caterpillar was fed up with rising health-care costs, said Todd Bisping, pharmacy benefits and informatics manager at the construction- and mining-equipment manufacturer, which estimated there was as much as 20 percent waste in the supply chain that was "not adding value, but just higher prices," he said on the Webcast.
"As I talk to other companies there's a lot of confusion and complexity in this," he said. "And I just think a lot of people don't understand it. The easiest thing to do is look at the number the PBMs spit out. As more and more companies realize we just can't blindly assume what's going on is best for us, they're going to start digging into it and find the same thing."
He said others are examining Caterpillar's program with Wal-Mart.
"I have talked to multiple large companies who called me because they are interested in learning more about this concept," Bisping said.
What Wal-Mart is doing isn't the only way to lower prescription drug prices, said Michael Polzin, spokesman for Deerfield-based Walgreen Co.
"We're going down a similar path by going directly to employers, but we have a more comprehensive offering," he said. Walgreens started a program in January offering lower drug prices, health and wellness clinics, and retail clinics on corporate campuses.
The price Wal-Mart charges Caterpillar for drugs is based on the price it paid the drugmaker, plus a markup for overhead and profit. Caterpillar doesn't know the price Wal-Mart paid the drugmaker but relies on an independent auditor to make sure the retailer begins with the actual price it paid, Bisping said.
Caterpillar declined to disclose how many of its 70,000 employees and retirees are using the program, but the company said it is more than expected. Caterpillar still has a contract with its PBM for the business of handling claims, an arrangement it intends to keep, Bisping said.
Wal-Mart set off a wave of price competition in 2006 when it began offering a range of generic drugs for $4 a month.
smjones@tribune.com
Washington Post Editorial: The Price of Realism - President Obama's plan for Afghanistan and Pakistan is ambitious and expensive. It is also hard-hea
Washington Post Editorial: The Price of Realism - President Obama's plan for Afghanistan and Pakistan is ambitious and expensive. It is also hard-headed
Copyright by The Washington Post
Saturday, March 28, 2009; Page A12
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/27/AR2009032702716.html
THE STRATEGY for Afghanistan and Pakistan announced by President Obama yesterday is conservative as well as bold. It is conservative because Mr. Obama chose to embrace many of the recommendations of U.S. military commanders and the Bush administration, based on the hard lessons of seven years of war. Yet it is bold -- and politically brave -- because, at a time of economic crisis and war-weariness at home, Mr. Obama is ordering not just a major increase in U.S. troops, but also an ambitious effort at nation-building in both Afghanistan and Pakistan. He is right to do it.
Few Americans would dispute Mr. Obama's description yesterday of the continuing threat from Afghanistan and Pakistan's tribal areas. "Multiple intelligence estimates have warned that al-Qaeda is actively planning attacks on the U.S. homeland from its safe haven in Pakistan," he said. "And if the Afghan government falls to the Taliban -- or allows al-Qaeda to go unchallenged -- that country will again be a base for terrorists who want to kill as many of our people as they possibly can." The goal he stated was similarly simple and clear: "to disrupt, dismantle and defeat al-Qaeda in Pakistan and Afghanistan, and to prevent their return to either country in the future."
What distinguishes the president's plan -- and opens him to criticism from some liberals as well as conservatives -- is its recognition that U.S. goals cannot be achieved without a major effort to strengthen the economies and political institutions of Pakistan and Afghanistan. The Bush administration tried to combat the al-Qaeda threat with limited numbers of U.S. and NATO troops, targeted strikes against militants, and broad, mostly ineffective, aid programs. It provided large sums of money to the Pakistani army, with few strings attached, in the hope that action would be taken against terrorist camps near the Afghan border. The strategy failed: The Taliban has only grown stronger, and both the Afghan and Pakistani governments are dangerously weak.
The lesson is that only a strategy that aims at protecting and winning over the populations where the enemy operates, and at strengthening the armies, judiciaries, and police and political institutions of Afghanistan, can reverse the momentum of the war and, eventually, allow a safe and honorable exit for U.S. and NATO troops. This means more soldiers, more civilian experts and much higher costs in the short term: Mr. Obama has approved a total of 21,000 more U.S. troops and several hundred additional civilians for Afghanistan, and yesterday he endorsed two pieces of legislation that would provide Pakistan with billions of dollars in nonmilitary aid as well as trade incentives for investment in the border areas. More is likely to be needed: U.S. commanders in Afghanistan hope to obtain another brigade of troops and a division headquarters in 2010, and to double the Afghan army again after the expansion now underway is completed in 2011. Mr. Obama should support those plans.
Such initiatives are not the product of starry-eyed idealism or an attempt to convert either country into "the 51st state" but of a realistic appreciation of what has worked -- and failed -- during the past seven years. As Mr. Obama put it, "It's far cheaper to train a policeman to secure his or her own village or to help a farmer seed a crop than it is to send our troops to fight tour after tour of duty with no transition to Afghan responsibility." That effort will be expensive and will require years of steadiness. But it offers the best chance for minimizing the threat of Islamic jihadism -- to this country and to the world.
Copyright by The Washington Post
Saturday, March 28, 2009; Page A12
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/27/AR2009032702716.html
THE STRATEGY for Afghanistan and Pakistan announced by President Obama yesterday is conservative as well as bold. It is conservative because Mr. Obama chose to embrace many of the recommendations of U.S. military commanders and the Bush administration, based on the hard lessons of seven years of war. Yet it is bold -- and politically brave -- because, at a time of economic crisis and war-weariness at home, Mr. Obama is ordering not just a major increase in U.S. troops, but also an ambitious effort at nation-building in both Afghanistan and Pakistan. He is right to do it.
Few Americans would dispute Mr. Obama's description yesterday of the continuing threat from Afghanistan and Pakistan's tribal areas. "Multiple intelligence estimates have warned that al-Qaeda is actively planning attacks on the U.S. homeland from its safe haven in Pakistan," he said. "And if the Afghan government falls to the Taliban -- or allows al-Qaeda to go unchallenged -- that country will again be a base for terrorists who want to kill as many of our people as they possibly can." The goal he stated was similarly simple and clear: "to disrupt, dismantle and defeat al-Qaeda in Pakistan and Afghanistan, and to prevent their return to either country in the future."
What distinguishes the president's plan -- and opens him to criticism from some liberals as well as conservatives -- is its recognition that U.S. goals cannot be achieved without a major effort to strengthen the economies and political institutions of Pakistan and Afghanistan. The Bush administration tried to combat the al-Qaeda threat with limited numbers of U.S. and NATO troops, targeted strikes against militants, and broad, mostly ineffective, aid programs. It provided large sums of money to the Pakistani army, with few strings attached, in the hope that action would be taken against terrorist camps near the Afghan border. The strategy failed: The Taliban has only grown stronger, and both the Afghan and Pakistani governments are dangerously weak.
The lesson is that only a strategy that aims at protecting and winning over the populations where the enemy operates, and at strengthening the armies, judiciaries, and police and political institutions of Afghanistan, can reverse the momentum of the war and, eventually, allow a safe and honorable exit for U.S. and NATO troops. This means more soldiers, more civilian experts and much higher costs in the short term: Mr. Obama has approved a total of 21,000 more U.S. troops and several hundred additional civilians for Afghanistan, and yesterday he endorsed two pieces of legislation that would provide Pakistan with billions of dollars in nonmilitary aid as well as trade incentives for investment in the border areas. More is likely to be needed: U.S. commanders in Afghanistan hope to obtain another brigade of troops and a division headquarters in 2010, and to double the Afghan army again after the expansion now underway is completed in 2011. Mr. Obama should support those plans.
Such initiatives are not the product of starry-eyed idealism or an attempt to convert either country into "the 51st state" but of a realistic appreciation of what has worked -- and failed -- during the past seven years. As Mr. Obama put it, "It's far cheaper to train a policeman to secure his or her own village or to help a farmer seed a crop than it is to send our troops to fight tour after tour of duty with no transition to Afghan responsibility." That effort will be expensive and will require years of steadiness. But it offers the best chance for minimizing the threat of Islamic jihadism -- to this country and to the world.
Why a GOP Benefactor Switched Parties
Why a GOP Benefactor Switched Parties
By Kathleen Parker
Copyright by The Washington Post
Sunday, March 29, 2009; Page A11
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/27/AR2009032702568.html
Just as news breaks that political fundraising is down for both parties, Republicans have lost one of their more generous contributors.
In what one might call a biblical move, Christian philanthropist Howard Ahmanson -- one of three major funders of the campaign for California's Proposition 8, which banned same-sex marriages -- has abandoned the GOP for the Democratic Party.
No one ever said the multimillionaire isn't idiosyncratic.
In a rare interview Thursday, Ahmanson shared some of his thoughts about why he switched parties. In a word, taxes.
Specifically, he was offended by the California Republican Party's insistence during a recent state budget battle that there would be no tax increases for any reason, no matter what. "They're providing one issue, and it's just a very silly issue," Ahmanson told me by telephone.
So, without fanfare, Ahmanson printed out an online form and mailed in his Democratic Party registration. Thus far, he's heard nothing back, but confesses to hoping he'll receive a little card or something.
Ahmanson, who was born to and inherited great wealth, has spent a lifetime trying to figure out what to do with his good fortune. It has been, at times, a burden of guilt, complicated by a lonely childhood. He also has Tourette's syndrome, which has contributed to his reclusiveness.
Now 58, Ahmanson is recognized as one of the nation's leading evangelical Christians and one of conservatism's most reliable supporters, though he is hardly a Republican talking-point man. He follows his own script and has parted company with social conservatives before. He thinks those who argue for school prayer, for instance, are confusing the moral with the religious. Morality is how we relate to one another, he says. Religion is how we relate to God -- "and it's not the government's business."
One can't mention Ahmanson without also discussing his association with Calvinist theologian R.J. Rushdoony, who believed in a literal application of biblical teachings and is credited with inspiring the Christian home-schooling movement.
Rushdoony's ideas captured Ahmanson's imagination in what the philanthropist now calls "my wild youth," but he has mellowed. Ahmanson certainly doesn't believe that homosexuals should be executed, as some of his critics have suggested, but he does believe that gays should "come to Christ and then recover."
He is also no longer the welfare abolitionist he used to be, "though I hate the attitude that welfare, once granted, is a moral entitlement that can never be reduced. And Social Security and Medicare are included in my definition of welfare."
Ahmanson's conversion to the Democratic Party, following decades of donating millions to conservative think tanks and causes, certainly qualifies as a "shocker" in political circles. "What!!!!!" is typical of the response I've gotten as I've sought reactions.
A few Republicans have e-mailed Ahmanson, but he hasn't gotten around to responding yet. He figures most are curious to understand his thinking. Some also may worry whither go those deep pockets, though Ahmanson's contributions to individual candidates have been relatively modest. As one conservative philanthropist put it: "He's more issue-oriented than party-oriented."
Thus, it isn't possible to draw conclusions about the direction of the Republican Party based on Ahmanson joining the "enemy camp." He did make some observations about the GOP, however, and said he sees the party's current problems as tension between "the upscales and the downscales" -- the upper middle classes and the lower middle classes.
"If I were in the GOP, I'd advocate the party should be downscaling." Heading, that is, toward a populist position.
Yes, he liked Sarah Palin all right, but he favors Louisiana Gov. Bobby Jindal. "I'm now a blue-dog Democrat for Bobby Jindal in 2012."
On Barack Obama, it's too early to tell, he says. "He may do well or he may not do well."
Ahmanson was disappointed, but not surprised, by Obama's overturning of Bush administration restrictions on abortion and embryonic stem cell research.
It is probably safe to say that when Democrats decided they needed to start talking more about faith and take God back from the GOP, they hadn't quite figured on landing Ahmanson. But Ahmanson is certain he'll find friends among Democrats who believe, as he does, that conservative ideas are not exclusively Republican.
On the other hand, he says that Democrats who have contacted him think he will be disappointed to find a lack of support for his views. Says Ahmanson: "We'll see how tolerant they really are."
kparker@kparker.com
By Kathleen Parker
Copyright by The Washington Post
Sunday, March 29, 2009; Page A11
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/27/AR2009032702568.html
Just as news breaks that political fundraising is down for both parties, Republicans have lost one of their more generous contributors.
In what one might call a biblical move, Christian philanthropist Howard Ahmanson -- one of three major funders of the campaign for California's Proposition 8, which banned same-sex marriages -- has abandoned the GOP for the Democratic Party.
No one ever said the multimillionaire isn't idiosyncratic.
In a rare interview Thursday, Ahmanson shared some of his thoughts about why he switched parties. In a word, taxes.
Specifically, he was offended by the California Republican Party's insistence during a recent state budget battle that there would be no tax increases for any reason, no matter what. "They're providing one issue, and it's just a very silly issue," Ahmanson told me by telephone.
So, without fanfare, Ahmanson printed out an online form and mailed in his Democratic Party registration. Thus far, he's heard nothing back, but confesses to hoping he'll receive a little card or something.
Ahmanson, who was born to and inherited great wealth, has spent a lifetime trying to figure out what to do with his good fortune. It has been, at times, a burden of guilt, complicated by a lonely childhood. He also has Tourette's syndrome, which has contributed to his reclusiveness.
Now 58, Ahmanson is recognized as one of the nation's leading evangelical Christians and one of conservatism's most reliable supporters, though he is hardly a Republican talking-point man. He follows his own script and has parted company with social conservatives before. He thinks those who argue for school prayer, for instance, are confusing the moral with the religious. Morality is how we relate to one another, he says. Religion is how we relate to God -- "and it's not the government's business."
One can't mention Ahmanson without also discussing his association with Calvinist theologian R.J. Rushdoony, who believed in a literal application of biblical teachings and is credited with inspiring the Christian home-schooling movement.
Rushdoony's ideas captured Ahmanson's imagination in what the philanthropist now calls "my wild youth," but he has mellowed. Ahmanson certainly doesn't believe that homosexuals should be executed, as some of his critics have suggested, but he does believe that gays should "come to Christ and then recover."
He is also no longer the welfare abolitionist he used to be, "though I hate the attitude that welfare, once granted, is a moral entitlement that can never be reduced. And Social Security and Medicare are included in my definition of welfare."
Ahmanson's conversion to the Democratic Party, following decades of donating millions to conservative think tanks and causes, certainly qualifies as a "shocker" in political circles. "What!!!!!" is typical of the response I've gotten as I've sought reactions.
A few Republicans have e-mailed Ahmanson, but he hasn't gotten around to responding yet. He figures most are curious to understand his thinking. Some also may worry whither go those deep pockets, though Ahmanson's contributions to individual candidates have been relatively modest. As one conservative philanthropist put it: "He's more issue-oriented than party-oriented."
Thus, it isn't possible to draw conclusions about the direction of the Republican Party based on Ahmanson joining the "enemy camp." He did make some observations about the GOP, however, and said he sees the party's current problems as tension between "the upscales and the downscales" -- the upper middle classes and the lower middle classes.
"If I were in the GOP, I'd advocate the party should be downscaling." Heading, that is, toward a populist position.
Yes, he liked Sarah Palin all right, but he favors Louisiana Gov. Bobby Jindal. "I'm now a blue-dog Democrat for Bobby Jindal in 2012."
On Barack Obama, it's too early to tell, he says. "He may do well or he may not do well."
Ahmanson was disappointed, but not surprised, by Obama's overturning of Bush administration restrictions on abortion and embryonic stem cell research.
It is probably safe to say that when Democrats decided they needed to start talking more about faith and take God back from the GOP, they hadn't quite figured on landing Ahmanson. But Ahmanson is certain he'll find friends among Democrats who believe, as he does, that conservative ideas are not exclusively Republican.
On the other hand, he says that Democrats who have contacted him think he will be disappointed to find a lack of support for his views. Says Ahmanson: "We'll see how tolerant they really are."
kparker@kparker.com
New York Times Editorial: Border Control
New York Times Editorial: Border Control
Copyright by tHe New York Times
Published: March 28, 2009
http://www.nytimes.com/2009/03/28/opinion/28sat2.html?ref=opinion
The Obama administration has taken sensible steps to keep Mexico’s vicious drug war from spilling over the border. The homeland security secretary, Janet Napolitano, announced that she was sending hundreds more agents and officers to patrol the border region and to work with the authorities in Mexico. She also is bolstering screening technology at border crossings to root out drugs, drug money, guns and violent fugitives.
The moves were encouraging for the realism and proportion they bring to the job of controlling a long and all-too-lawless border. They add resources to curb the deadliest illegal flow — of drugs, guns and cash — and recognize a critical distinction between narco-gangs who mean us harm and economic migrants who don’t.
The administration is, helpfully, stressing the importance of sharing information and resources with Mexico. It is also acknowledging the role of the United States in Mexico’s agonies. Americans, after all, are the addicts whose desperate consumption fuels the drug trade, and the gun merchants whose illegal profiteering has turned feuding cartels into bristling armies. Secretary of State Hillary Rodham Clinton was right to have explicitly conceded that point this week. It is good news that our government will soon be stepping up screening for guns in trucks and train cars heading south.
This is the kind of targeted crackdown that crime-weary officials along the border have long sought. But there is one more thing to help it succeed: Enact comprehensive immigration reform. Fight the illegal flow not just with more armed guards, but with more visas.
For too long, the United States has suffered from a mind-set that conflates all illegal border crossers into a single criminal class — the all-purpose alien threat. This has led it to spread scarce law-enforcement resources over 2,000 miles of dirt and mountains. The fence is more a political prop than an actual border sealant. Drugs, guns and people still get across. The hunt for violent fugitives and gang members languishes while the authorities chase after every last janitor and farm worker.
Most perversely, the lack of an honest path to jobs in the north dovetails with the business plans of narco-gangs. Many have shifted to human smuggling, easily exploiting frightened immigrants as silent — and highly lucrative — contraband.
The tough-smart strategy, which the Obama administration seems willing to pursue, combines aggressive enforcement against criminals with opportunities for legal status, even citizenship, for economic migrants — the people who would gladly line up to enter lawfully, if such a line existed.
Copyright by tHe New York Times
Published: March 28, 2009
http://www.nytimes.com/2009/03/28/opinion/28sat2.html?ref=opinion
The Obama administration has taken sensible steps to keep Mexico’s vicious drug war from spilling over the border. The homeland security secretary, Janet Napolitano, announced that she was sending hundreds more agents and officers to patrol the border region and to work with the authorities in Mexico. She also is bolstering screening technology at border crossings to root out drugs, drug money, guns and violent fugitives.
The moves were encouraging for the realism and proportion they bring to the job of controlling a long and all-too-lawless border. They add resources to curb the deadliest illegal flow — of drugs, guns and cash — and recognize a critical distinction between narco-gangs who mean us harm and economic migrants who don’t.
The administration is, helpfully, stressing the importance of sharing information and resources with Mexico. It is also acknowledging the role of the United States in Mexico’s agonies. Americans, after all, are the addicts whose desperate consumption fuels the drug trade, and the gun merchants whose illegal profiteering has turned feuding cartels into bristling armies. Secretary of State Hillary Rodham Clinton was right to have explicitly conceded that point this week. It is good news that our government will soon be stepping up screening for guns in trucks and train cars heading south.
This is the kind of targeted crackdown that crime-weary officials along the border have long sought. But there is one more thing to help it succeed: Enact comprehensive immigration reform. Fight the illegal flow not just with more armed guards, but with more visas.
For too long, the United States has suffered from a mind-set that conflates all illegal border crossers into a single criminal class — the all-purpose alien threat. This has led it to spread scarce law-enforcement resources over 2,000 miles of dirt and mountains. The fence is more a political prop than an actual border sealant. Drugs, guns and people still get across. The hunt for violent fugitives and gang members languishes while the authorities chase after every last janitor and farm worker.
Most perversely, the lack of an honest path to jobs in the north dovetails with the business plans of narco-gangs. Many have shifted to human smuggling, easily exploiting frightened immigrants as silent — and highly lucrative — contraband.
The tough-smart strategy, which the Obama administration seems willing to pursue, combines aggressive enforcement against criminals with opportunities for legal status, even citizenship, for economic migrants — the people who would gladly line up to enter lawfully, if such a line existed.
Don’t Deport Benita Veliz
Don’t Deport Benita Veliz
By LAWRENCE DOWNES
Copyright by The New York Times
Published: March 28, 2009
http://www.nytimes.com/2009/03/28/opinion/28sat4.html?ref=opinion
A question from the realm of the unanswerable: How will this country be a better place once we force Benita Veliz to leave it?
Ms. Veliz is an illegal immigrant facing deportation, but she is nobody’s idea of a criminal, social undesirable or drain on the public till.
She is a 23-year-old college graduate from San Antonio who works in a church office. She is smart, self-sufficient and hard-working. She is bursting with academic and professional ambitions — dreams that she has set aside because her paths to achieve them have all been closed. Immigration lawyers have told her that she has no hope of avoiding expulsion. She can only postpone it.
Ms. Veliz is here illegally, but not by choice. She arrived from Mexico with her parents in 1993 on a tourist visa. She was 8. She had never lived in the United States before but has lived nowhere else since. By all detectable measures, she is an American, a Texan.
And an impressive one at that. She was valedictorian at Jefferson High School, graduating at age 16. She went to St. Mary’s University in San Antonio on a full scholarship. She doubled majored in biology and sociology and fully deployed herself beyond the classroom in clubs, student government, choir. She volunteered in a children’s hospital. And she waited tables 45 hours a week in a Mexican restaurant.
Her honors thesis was about the Dream Act.
A quick digression about that. The Dream Act is a Congressional bill that would allow children of illegal immigrants to earn citizenship after going to college or serving in the military. The idea is that America should not expel but assimilate dedicated young people who are not at fault for their illegal status. The Dream Act seeks to make citizens out of people, like Benita Veliz, who are longing — and fighting — for its passage. Bipartisan Dream Act bills were introduced in the House and Senate just this week, their future uncertain.
Ms. Veliz wanted to go to law school, but couldn’t afford tuition and didn’t qualify for federal loans. So she started a photography and design business, taught piano and tutored in math and science. She now works in a regional office of a Pentecostal church in San Antonio, doing payroll and other administrative tasks.
Her fateful encounter with the law happened on Jan. 21. A police officer pulled her over, saying she had rolled through a stop sign. She says that is not true, but she acknowledges driving without a license. She had a Mexican consular identity card, and after a series of questions, the officer called immigration authorities. She was jailed overnight and released on bond.
Nancy Shivers, an immigration lawyer in San Antonio whom Ms. Veliz has consulted, said she met some of the requirements that might have allowed her to stay in the United States. She has been here more than 10 years and is demonstrably of good moral character. But without a qualifying parent, spouse or child to petition on her behalf, she cannot stay.
Ms. Shivers says Ms. Veliz is a poster child for the Dream Act, but hardly the only one. For every Benita Veliz, she said, there many others who dropped out because they saw no point in getting a college degree. They are working in low-wage jobs, off the books, their bright futures prematurely dead-ended.
Ms. Veliz’s voice cracks when talking about her case, but she gets excited when asked about her dreams. The words just tumble out:
“I would like to go to law school and be an attorney for a few years, and then after that get into politics on a Congressional level, either senator or representative. I’ve actually always wanted to do international relations, get a master’s in international relations, with a law degree. I would want to do international law, or immigration law, but not really just that, but that’s just one small sort of thing in the long spectrum of things.”
For Ms. Veliz, the long spectrum of things might involve a long or permanent stay in Mexico, a country that she does not know or belong in anymore.
As for the country she knows and loves, if it were smarter and kinder, more like the country we see in fuzzy old documentaries, where hopeful families cluster on the decks of ships passing the Statue of Liberty, it would find a way to let her stay. It would let her go to law school. It would accept Benita Veliz as the American she is.
By LAWRENCE DOWNES
Copyright by The New York Times
Published: March 28, 2009
http://www.nytimes.com/2009/03/28/opinion/28sat4.html?ref=opinion
A question from the realm of the unanswerable: How will this country be a better place once we force Benita Veliz to leave it?
Ms. Veliz is an illegal immigrant facing deportation, but she is nobody’s idea of a criminal, social undesirable or drain on the public till.
She is a 23-year-old college graduate from San Antonio who works in a church office. She is smart, self-sufficient and hard-working. She is bursting with academic and professional ambitions — dreams that she has set aside because her paths to achieve them have all been closed. Immigration lawyers have told her that she has no hope of avoiding expulsion. She can only postpone it.
Ms. Veliz is here illegally, but not by choice. She arrived from Mexico with her parents in 1993 on a tourist visa. She was 8. She had never lived in the United States before but has lived nowhere else since. By all detectable measures, she is an American, a Texan.
And an impressive one at that. She was valedictorian at Jefferson High School, graduating at age 16. She went to St. Mary’s University in San Antonio on a full scholarship. She doubled majored in biology and sociology and fully deployed herself beyond the classroom in clubs, student government, choir. She volunteered in a children’s hospital. And she waited tables 45 hours a week in a Mexican restaurant.
Her honors thesis was about the Dream Act.
A quick digression about that. The Dream Act is a Congressional bill that would allow children of illegal immigrants to earn citizenship after going to college or serving in the military. The idea is that America should not expel but assimilate dedicated young people who are not at fault for their illegal status. The Dream Act seeks to make citizens out of people, like Benita Veliz, who are longing — and fighting — for its passage. Bipartisan Dream Act bills were introduced in the House and Senate just this week, their future uncertain.
Ms. Veliz wanted to go to law school, but couldn’t afford tuition and didn’t qualify for federal loans. So she started a photography and design business, taught piano and tutored in math and science. She now works in a regional office of a Pentecostal church in San Antonio, doing payroll and other administrative tasks.
Her fateful encounter with the law happened on Jan. 21. A police officer pulled her over, saying she had rolled through a stop sign. She says that is not true, but she acknowledges driving without a license. She had a Mexican consular identity card, and after a series of questions, the officer called immigration authorities. She was jailed overnight and released on bond.
Nancy Shivers, an immigration lawyer in San Antonio whom Ms. Veliz has consulted, said she met some of the requirements that might have allowed her to stay in the United States. She has been here more than 10 years and is demonstrably of good moral character. But without a qualifying parent, spouse or child to petition on her behalf, she cannot stay.
Ms. Shivers says Ms. Veliz is a poster child for the Dream Act, but hardly the only one. For every Benita Veliz, she said, there many others who dropped out because they saw no point in getting a college degree. They are working in low-wage jobs, off the books, their bright futures prematurely dead-ended.
Ms. Veliz’s voice cracks when talking about her case, but she gets excited when asked about her dreams. The words just tumble out:
“I would like to go to law school and be an attorney for a few years, and then after that get into politics on a Congressional level, either senator or representative. I’ve actually always wanted to do international relations, get a master’s in international relations, with a law degree. I would want to do international law, or immigration law, but not really just that, but that’s just one small sort of thing in the long spectrum of things.”
For Ms. Veliz, the long spectrum of things might involve a long or permanent stay in Mexico, a country that she does not know or belong in anymore.
As for the country she knows and loves, if it were smarter and kinder, more like the country we see in fuzzy old documentaries, where hopeful families cluster on the decks of ships passing the Statue of Liberty, it would find a way to let her stay. It would let her go to law school. It would accept Benita Veliz as the American she is.
Amid Abuse of Girls in Brazil, Abortion Debate Flares
Amid Abuse of Girls in Brazil, Abortion Debate Flares
By ALEXEI BARRIONUEVO
Copyright by The New York Times
Published: March 27, 2009
http://www.nytimes.com/2009/03/28/world/americas/28brazil.html?_r=1&hp
SÃO PAULO, Brazil — The waiting room at Pérola Byington Hospital resembles a small day care center many days. Young girls play on the cold tile floors or rock hyperactively in plastic chairs, while their mothers stare pensively at the red digital readout on a wall, signaling their place in line.
But this is a women’s health clinic specializing in treating victims of sexual violence. Of the 15 such cases the hospital averages each day, nearly half involve children under 12.
While much of Brazil has been riled by the case of a 9-year-old girl who aborted twins this month after claiming her stepfather raped her, her ordeal was an all too familiar one at the clinic.
The girl’s story of rape and pregnancy at such a young age seemingly caught the nation off guard, reviving a tense debate over reproductive rights in a country with more Catholics than any other. But doctors, clinic workers and other experts say her case is symptomatic of a widespread problem of sexual abuse of under-age girls — one that has long been neglected and may be getting worse.
“Unfortunately, this is becoming more and more common,” said Daniela Pedroso, a psychologist who has worked here for 11 years.
Weighing just 79 pounds and barely four feet tall, the 9-year-old girl, from Alagoinha, a town in the northeast, underwent an abortion when she was 15 weeks pregnant at one of the 55 centers authorized to perform the procedure in Brazil. Abortion is legal here only in cases of rape or when the mother’s life is at risk.
The doctors’ actions set off a swirl of controversy. A Brazilian archbishop summarily excommunicated everyone involved — the doctors for performing the abortion and the girl’s mother for allowing it — except for the stepfather, who stands accused of raping the girl over a number of years.
“The law of God is above any human law,” said José Cardoso Sobrinho, the archbishop, who argued that while rape was bad, abortion was even worse.
The storm intensified when a high-ranking Vatican official supported the excommunications. But then a conference of Brazilian bishops overruled Archbishop Sobrinho, saying that the child’s mother had acted “under pressure” from doctors who said the girl would die if she carried the babies to term, and that only doctors who “systematically” performed abortions should be thrown out of the church.
Finally, the Vatican’s top bioethics official, Archbishop Rino Fisichella, also criticized the initial stance, saying the “credibility of our teaching took a blow as it appeared, in the eyes of many, to be insensitive, incomprehensible and lacking mercy.”
The case has brought to light other instances of young girls being raped and impregnated by family members, especially in the poorer northeastern region.
The number of legal abortions of girls ages 10 to 14 more than doubled last year to 49, up from 22 in 2007, the Ministry of Health reported. That was out of 3,050 legal abortions performed last year in a country of more than 190 million. But the vast majority of Brazil’s abortions are not legal. The Ministry of Health estimates about one million unsafe or clandestine abortions every year.
Brazil’s abortion laws are among the strictest in Latin America. Only Chile, El Salvador and Nicaragua, which have banned abortion outright for any reason, are stricter, according to the Center for Reproductive Rights, which supports abortion rights.
In some parts of the region, most notably Mexico City, where first-trimester abortions are now legal, laws have been relaxed. But in other areas and countries, legislators have sought to toughen the restrictions on abortion.
Twenty years ago, Brazil had just one center to perform abortions. Today, beyond the 55 clinics that can perform them, another 400 or so treat patients that have been sexually abused.
“It’s still not enough,” said Beatriz Galli, a policy associate and human rights lawyer with Ipas, an organization pushing to expand women’s reproductive rights. Most state-financed clinics are in capitals that can be as far as an 11-hour boat ride away, and they are concentrated in the wealthier southeast region.
Anti-abortion advocates, who represent the majority in Brazil’s Congress, are pushing hard to make the law even tighter. Of some 50 abortion-related initiatives being studied in Congress, at least 40 seek to further criminalize abortion, according to a study by the Feminist Center for Studies and Advisory Services, a Brazilian group that supports less restrictive abortion laws. One would require home pregnancy tests to carry labels with warnings like “The penalty for abortion is one to three years in prison.”
Access to legal abortion clinics is also a challenge. The 9-year-old girl from Alagoinha sought medical treatment after complaining of pain. But with no legal abortion center near her home, she had to be driven about 140 miles to a state clinic in Recife. Doctors there said the girl’s uterus was too small to support one baby, let alone two.
The 9-year-old girl’s stepfather was arrested and accused of raping her and her 14-year-old sister on multiple occasions, the police later said.
Luiz Inácio Lula da Silva, Brazil’s president, said he regretted the archbishop’s decision to excommunicate the two doctors, saying they had done the right thing in saving the young girl’s life. She will probably “need decades of psychological care to get her life back to normal,” he said.
Here at Pérola Byington Hospital, doctors said abortions were often necessary to protect the lives of sexual-violence victims. Of the 47 abortions performed at the hospital last year, 13 were girls under 18, all victims of rape.
In more than 80 percent of the cases, fathers or stepfathers committed the sexual abuse, doctors at the clinic said.
“A part of Brazilian society still doesn’t want to stop treating women like they are property,” said Jefferson Drezett, a gynecologist and coordinator of the sexual-abuse victims service at the hospital. “This has to change.”
Earlier this month, a 21-year-old woman walked into the hospital with her 6-year-old daughter. She said the 6-year-old had been sexually molested by the girl’s stepgrandfather, whom the woman was seeking to have arrested.
The woman, who spoke on the condition of anonymity, sat for an interview in a room with tiny chairs and dolls that is used for the psychological evaluation of victims. She said she had lived with him until she was 14, when she felt uncomfortable with his advances and asked her mother to leave him.
Fighting back tears, she said she worried that the man would abuse other children still living with him, including the daughters of his own son that are close to her daughter’s age.
“We don’t want to believe what happened,” she said. “We think this just happens on television, that it’s a fairy tale. But the reality is it can happen to any family, and it’s very difficult to deal with when it does.”
Mery Galanternick contributed reporting from Rio de Janeiro.
By ALEXEI BARRIONUEVO
Copyright by The New York Times
Published: March 27, 2009
http://www.nytimes.com/2009/03/28/world/americas/28brazil.html?_r=1&hp
SÃO PAULO, Brazil — The waiting room at Pérola Byington Hospital resembles a small day care center many days. Young girls play on the cold tile floors or rock hyperactively in plastic chairs, while their mothers stare pensively at the red digital readout on a wall, signaling their place in line.
But this is a women’s health clinic specializing in treating victims of sexual violence. Of the 15 such cases the hospital averages each day, nearly half involve children under 12.
While much of Brazil has been riled by the case of a 9-year-old girl who aborted twins this month after claiming her stepfather raped her, her ordeal was an all too familiar one at the clinic.
The girl’s story of rape and pregnancy at such a young age seemingly caught the nation off guard, reviving a tense debate over reproductive rights in a country with more Catholics than any other. But doctors, clinic workers and other experts say her case is symptomatic of a widespread problem of sexual abuse of under-age girls — one that has long been neglected and may be getting worse.
“Unfortunately, this is becoming more and more common,” said Daniela Pedroso, a psychologist who has worked here for 11 years.
Weighing just 79 pounds and barely four feet tall, the 9-year-old girl, from Alagoinha, a town in the northeast, underwent an abortion when she was 15 weeks pregnant at one of the 55 centers authorized to perform the procedure in Brazil. Abortion is legal here only in cases of rape or when the mother’s life is at risk.
The doctors’ actions set off a swirl of controversy. A Brazilian archbishop summarily excommunicated everyone involved — the doctors for performing the abortion and the girl’s mother for allowing it — except for the stepfather, who stands accused of raping the girl over a number of years.
“The law of God is above any human law,” said José Cardoso Sobrinho, the archbishop, who argued that while rape was bad, abortion was even worse.
The storm intensified when a high-ranking Vatican official supported the excommunications. But then a conference of Brazilian bishops overruled Archbishop Sobrinho, saying that the child’s mother had acted “under pressure” from doctors who said the girl would die if she carried the babies to term, and that only doctors who “systematically” performed abortions should be thrown out of the church.
Finally, the Vatican’s top bioethics official, Archbishop Rino Fisichella, also criticized the initial stance, saying the “credibility of our teaching took a blow as it appeared, in the eyes of many, to be insensitive, incomprehensible and lacking mercy.”
The case has brought to light other instances of young girls being raped and impregnated by family members, especially in the poorer northeastern region.
The number of legal abortions of girls ages 10 to 14 more than doubled last year to 49, up from 22 in 2007, the Ministry of Health reported. That was out of 3,050 legal abortions performed last year in a country of more than 190 million. But the vast majority of Brazil’s abortions are not legal. The Ministry of Health estimates about one million unsafe or clandestine abortions every year.
Brazil’s abortion laws are among the strictest in Latin America. Only Chile, El Salvador and Nicaragua, which have banned abortion outright for any reason, are stricter, according to the Center for Reproductive Rights, which supports abortion rights.
In some parts of the region, most notably Mexico City, where first-trimester abortions are now legal, laws have been relaxed. But in other areas and countries, legislators have sought to toughen the restrictions on abortion.
Twenty years ago, Brazil had just one center to perform abortions. Today, beyond the 55 clinics that can perform them, another 400 or so treat patients that have been sexually abused.
“It’s still not enough,” said Beatriz Galli, a policy associate and human rights lawyer with Ipas, an organization pushing to expand women’s reproductive rights. Most state-financed clinics are in capitals that can be as far as an 11-hour boat ride away, and they are concentrated in the wealthier southeast region.
Anti-abortion advocates, who represent the majority in Brazil’s Congress, are pushing hard to make the law even tighter. Of some 50 abortion-related initiatives being studied in Congress, at least 40 seek to further criminalize abortion, according to a study by the Feminist Center for Studies and Advisory Services, a Brazilian group that supports less restrictive abortion laws. One would require home pregnancy tests to carry labels with warnings like “The penalty for abortion is one to three years in prison.”
Access to legal abortion clinics is also a challenge. The 9-year-old girl from Alagoinha sought medical treatment after complaining of pain. But with no legal abortion center near her home, she had to be driven about 140 miles to a state clinic in Recife. Doctors there said the girl’s uterus was too small to support one baby, let alone two.
The 9-year-old girl’s stepfather was arrested and accused of raping her and her 14-year-old sister on multiple occasions, the police later said.
Luiz Inácio Lula da Silva, Brazil’s president, said he regretted the archbishop’s decision to excommunicate the two doctors, saying they had done the right thing in saving the young girl’s life. She will probably “need decades of psychological care to get her life back to normal,” he said.
Here at Pérola Byington Hospital, doctors said abortions were often necessary to protect the lives of sexual-violence victims. Of the 47 abortions performed at the hospital last year, 13 were girls under 18, all victims of rape.
In more than 80 percent of the cases, fathers or stepfathers committed the sexual abuse, doctors at the clinic said.
“A part of Brazilian society still doesn’t want to stop treating women like they are property,” said Jefferson Drezett, a gynecologist and coordinator of the sexual-abuse victims service at the hospital. “This has to change.”
Earlier this month, a 21-year-old woman walked into the hospital with her 6-year-old daughter. She said the 6-year-old had been sexually molested by the girl’s stepgrandfather, whom the woman was seeking to have arrested.
The woman, who spoke on the condition of anonymity, sat for an interview in a room with tiny chairs and dolls that is used for the psychological evaluation of victims. She said she had lived with him until she was 14, when she felt uncomfortable with his advances and asked her mother to leave him.
Fighting back tears, she said she worried that the man would abuse other children still living with him, including the daughters of his own son that are close to her daughter’s age.
“We don’t want to believe what happened,” she said. “We think this just happens on television, that it’s a fairy tale. But the reality is it can happen to any family, and it’s very difficult to deal with when it does.”
Mery Galanternick contributed reporting from Rio de Janeiro.
Financial Times Editorial: Catholic tastes
Financial Times Editorial: Catholic tastes
Copyright The Financial Times Limited 2009
Published: March 27 2009 22:34 | Last updated: March 27 2009 22:34
http://www.ft.com/cms/s/0/65c3d728-1b04-11de-8aa3-0000779fd2ac.html
Who would have thought it? The British royal family, it transpires, is not all that keen on absurd anachronisms. Since 1689, royals who wish to accede to the throne have been banned not only from practising Roman Catholicism but also from wedding people who do. But among reforms being discussed by the Queen and the prime minister is a plan to allow British royals to marry Catholics. About time too.
These rules are remnants of the most successful propaganda effort in British history – the “Glorious Revolution” of 1688. It was an invasion by 15,000 foreign troops, which scared a sitting King into exile so that a Dutch princeling could seize power. But a sophisticated media campaign spun it as a peaceful transfer of power from a Papist brute to a great Protestant prince at the invitation of British patriots.
The English were a good audience for this bile; the oppressiveness of France’s Sun King was considered proof that Catholicism was not compatible with freedom. This tribal prejudice led the British to prefer to import kings (or have kings imported upon them) rather than risk the whiff of incense from home-grown heirs. This hatred is still strong in Northern Ireland and in parts of Scotland.
Changing the law about who may take the throne is not easy: if any of the other countries where Her Majesty is head of state do not approve and stick with the old rules of succession, they may get different monarchs from everyone else. It would be nice to find work for junior royals as sovereigns of far-flung places but would also cause regal ructions.
Her Majesty should go further. Roman Catholics should be allowed to hold her office. One can understand she may be nervous at such a move, but it has been at least 250 years since Catholics made a serious attempt to take the throne. She is probably safe. A Catholic monarch might have difficulty performing the monarch’s current role of head of the established churches. But the solution to that problem is another newfangled idea: separation of Church and State.
Copyright The Financial Times Limited 2009
Published: March 27 2009 22:34 | Last updated: March 27 2009 22:34
http://www.ft.com/cms/s/0/65c3d728-1b04-11de-8aa3-0000779fd2ac.html
Who would have thought it? The British royal family, it transpires, is not all that keen on absurd anachronisms. Since 1689, royals who wish to accede to the throne have been banned not only from practising Roman Catholicism but also from wedding people who do. But among reforms being discussed by the Queen and the prime minister is a plan to allow British royals to marry Catholics. About time too.
These rules are remnants of the most successful propaganda effort in British history – the “Glorious Revolution” of 1688. It was an invasion by 15,000 foreign troops, which scared a sitting King into exile so that a Dutch princeling could seize power. But a sophisticated media campaign spun it as a peaceful transfer of power from a Papist brute to a great Protestant prince at the invitation of British patriots.
The English were a good audience for this bile; the oppressiveness of France’s Sun King was considered proof that Catholicism was not compatible with freedom. This tribal prejudice led the British to prefer to import kings (or have kings imported upon them) rather than risk the whiff of incense from home-grown heirs. This hatred is still strong in Northern Ireland and in parts of Scotland.
Changing the law about who may take the throne is not easy: if any of the other countries where Her Majesty is head of state do not approve and stick with the old rules of succession, they may get different monarchs from everyone else. It would be nice to find work for junior royals as sovereigns of far-flung places but would also cause regal ructions.
Her Majesty should go further. Roman Catholics should be allowed to hold her office. One can understand she may be nervous at such a move, but it has been at least 250 years since Catholics made a serious attempt to take the throne. She is probably safe. A Catholic monarch might have difficulty performing the monarch’s current role of head of the established churches. But the solution to that problem is another newfangled idea: separation of Church and State.
Bank chiefs hold peace talks with Obama
Bank chiefs hold peace talks with Obama
By Andrew Ward and Tom Braithwaite in Washington and Francesco Guerrera in New York
Copyright The Financial Times Limited 2009
Published: March 27 2009 17:58 | Last updated: March 27 2009 17:58
http://www.ft.com/cms/s/0/e7f61650-1af7-11de-8aa3-0000779fd2ac.html
Top bank chief executives held peace talks with President Barack Obama at the White House on Friday as the administration sought to soothe tensions over lavish Wall Street bonus payments.
The meeting came at the end of a week in which in which Mr Obama pushed back against efforts by Congress to slap hefty tax penalties on bonuses and warned people not to “demonise” investors and entrepreneurs.
Ken Lewis of Bank of America, Jamie Dimon of JP Morgan, and Vikram Pandit of Citigroup were among 15 bank heads invited to the talks in the White House state dining room.
Robert Gibbs, White House press secretary, said the president would deliver a tough message on the need for shared sacrifice between Wall Street and Main Street.
But another administration official made clear it would not be a one-way lecture.
“The purpose of the meeting is to listen and to have a conversation about how we’re going to repair the damage to our financial system,” said the official. “Our recovery depends on reviving our financial system and capital markets.”
Mr Obama initially echoed and even encouraged public anger towards Wall Street after revelations earlier this month that AIG, the bailed-out insurer, had used taxpayer money to pay $165m of bonuses to top employees.
But he dialled back his rhetoric this week amid mounting concern that anti-Wall Street sentiment could undermine the administration’s efforts to shore up the financial sector.
In particular, Tim Geithner, Treasury secretary, needs support from investors for his plan, announced on Monday, for a public-private partnership to buy up the toxic assets weighing down bank balance sheets.
The administration has also been rattled by signs that healthier banks could withdraw early from the Troubled Asset Relief Programme because of heavy-handed government intervention, a move that would make it harder for the administration to kick-start lending.
Tensions between Wall Street and Washington reached a peak last week when the House of Representatives rushed through legislation to impose a 90 per cent tax on bonuses at many financial institutions receiving taxpayer support.
However, momentum behind the proposals has slowed this week after Mr Obama signalled his opposition and the initial wave of anger over the AIG bonuses fades.
Harry Reid, the Democratic leader in the Senate, insisted on Friday that “the issue has not gone away” but conceded that the Senate version of the bill was on hold until later in April at the earliest. “When we come back after Easter recess I’m committed to taking the lay of land to find out where we all go on this,” he said.
The Senate is working on a watered-down version of the House bill that would impose a 70 per cent tax on a wider range of bonuses, with half paid by the employee and half by the employer.
Bankers went into Friday’s meeting with a mixture of apprehension and hope.
Financial executives said that White House officials wanted to reassure them that President Obama would use the gathering to cool tensions rather than pressing them on specific issues.
However, few bankers believed the administration would not take the opportunity to remind the country’s largest financial institutions that the billions of dollars in taxpayers’ funds they have received came with strings attached.
“Hot button topics such as executive compensation, the resumption of lending and banks’ participation in the latest plan to rid the system of toxic assets are bound to come up,” said a Wall Street insider. “The question is how hard the White House wants to press the banks on these”.
For their part, bankers said they would be in a listening mode and keep their lobbying and complaints about the political furore surrounding the industry to a minimum.
Others attending the meeting included Lloyd Blankfein of Goldman Sachs, John Mack of Morgan Stanley, Ken Chenault of American Express, and Rick Waddell of Northern Trust.
By Andrew Ward and Tom Braithwaite in Washington and Francesco Guerrera in New York
Copyright The Financial Times Limited 2009
Published: March 27 2009 17:58 | Last updated: March 27 2009 17:58
http://www.ft.com/cms/s/0/e7f61650-1af7-11de-8aa3-0000779fd2ac.html
Top bank chief executives held peace talks with President Barack Obama at the White House on Friday as the administration sought to soothe tensions over lavish Wall Street bonus payments.
The meeting came at the end of a week in which in which Mr Obama pushed back against efforts by Congress to slap hefty tax penalties on bonuses and warned people not to “demonise” investors and entrepreneurs.
Ken Lewis of Bank of America, Jamie Dimon of JP Morgan, and Vikram Pandit of Citigroup were among 15 bank heads invited to the talks in the White House state dining room.
Robert Gibbs, White House press secretary, said the president would deliver a tough message on the need for shared sacrifice between Wall Street and Main Street.
But another administration official made clear it would not be a one-way lecture.
“The purpose of the meeting is to listen and to have a conversation about how we’re going to repair the damage to our financial system,” said the official. “Our recovery depends on reviving our financial system and capital markets.”
Mr Obama initially echoed and even encouraged public anger towards Wall Street after revelations earlier this month that AIG, the bailed-out insurer, had used taxpayer money to pay $165m of bonuses to top employees.
But he dialled back his rhetoric this week amid mounting concern that anti-Wall Street sentiment could undermine the administration’s efforts to shore up the financial sector.
In particular, Tim Geithner, Treasury secretary, needs support from investors for his plan, announced on Monday, for a public-private partnership to buy up the toxic assets weighing down bank balance sheets.
The administration has also been rattled by signs that healthier banks could withdraw early from the Troubled Asset Relief Programme because of heavy-handed government intervention, a move that would make it harder for the administration to kick-start lending.
Tensions between Wall Street and Washington reached a peak last week when the House of Representatives rushed through legislation to impose a 90 per cent tax on bonuses at many financial institutions receiving taxpayer support.
However, momentum behind the proposals has slowed this week after Mr Obama signalled his opposition and the initial wave of anger over the AIG bonuses fades.
Harry Reid, the Democratic leader in the Senate, insisted on Friday that “the issue has not gone away” but conceded that the Senate version of the bill was on hold until later in April at the earliest. “When we come back after Easter recess I’m committed to taking the lay of land to find out where we all go on this,” he said.
The Senate is working on a watered-down version of the House bill that would impose a 70 per cent tax on a wider range of bonuses, with half paid by the employee and half by the employer.
Bankers went into Friday’s meeting with a mixture of apprehension and hope.
Financial executives said that White House officials wanted to reassure them that President Obama would use the gathering to cool tensions rather than pressing them on specific issues.
However, few bankers believed the administration would not take the opportunity to remind the country’s largest financial institutions that the billions of dollars in taxpayers’ funds they have received came with strings attached.
“Hot button topics such as executive compensation, the resumption of lending and banks’ participation in the latest plan to rid the system of toxic assets are bound to come up,” said a Wall Street insider. “The question is how hard the White House wants to press the banks on these”.
For their part, bankers said they would be in a listening mode and keep their lobbying and complaints about the political furore surrounding the industry to a minimum.
Others attending the meeting included Lloyd Blankfein of Goldman Sachs, John Mack of Morgan Stanley, Ken Chenault of American Express, and Rick Waddell of Northern Trust.
US consumer spending rises in February
US consumer spending rises in February
By Alan Rappeport in New York
Copyright The Financial Times Limited 2009
Published: March 27 2009 13:21 | Last updated: March 27 2009 14:41
http://www.ft.com/cms/s/0/bab4794c-1ad0-11de-8aa3-0000779fd2ac.html
US consumers upped their spending for the second month running in February as prices rose, but concerns over falling incomes left the savings rate near last month’s 14-year high.
Personal consumption expenditure rose by 0.2 per cent, in line with economists’ expectations, according to commerce department figures released on Friday. The February rise followed a revised 1 per cent increase in January, which broke a record streak of six consecutive declines.
Economists expect that consumer spending could increase by an annual rate of 1 per cent in the first quarter of this year after falling by 4 per cent during the second half of last year. Recent figures showed that retail sales have stabilised during the last two months, falling by 0.1 per cent in February after jumping by 1.8 per cent in January.
Incomes fell back in February, with personal income declining by 0.2 per cent for the second consecutive month. The drop was largely due to rising job cuts, pay freezes and eliminated bonuses.
The commerce department’s closely watched gauge of prices rose 0.3 per cent in February, the same rate as in January, and showed a 0.2 per cent increase excluding food and energy for the second month running. Year-on-year core prices are up 1.8 per cent.
That should ease fears that the US downturn could lead to a deflationary trap. The labour department’s February consumer price index rose by 0.4 per cent on higher energy prices.
Meanwhile the savings rate, which is measured as the proportion of income left after spending and taxes, slipped from 4.4 percent to 4.2 per cent in February, retreating slightly from a 14-year high.
Consumers have curtailed spending in recent months as the economic recession has deepened. Earlier this month the Federal Reserve said that the net worth of US households plunged 18 per cent last year and 9 per cent last quarter, the biggest drops since tracking began in 1946.
“The US consumer is faced with daunting fundamentals,” said Joshua Shapiro, chief US economist at MFR. “Wage and salary income is declining, credit is very tight, home prices continue to fall, financial asset values have been decimated, and household balance sheets are extremely stressed.”
Such conditions kept consumer sentiment, as reported on Friday by the University of Michigan’s index, depressed this month. Sentiment rose to 57.3 in March from a revised 56.3 the prior month, in a reading that was slightly more optimistic than analysts expected. The index, produced jointly with Reuters, bottomed at 51.7 in 1980.
Falling incomes and dim sentiment reflect the impact of the deteriorating employment situation. In February the unemployment rate jumped from 7.6 per cent to 8.1 per cent, its highest level since 1983, as the number of jobs lost reached 651,000. Economists expect that another 700,000 jobs could be lost this month and that the official employment report next week could show the jobless rate reaching 8.5 per cent.
Feelings about current conditions slipped this month but expectations ticked up, as consumers took hope from rebounding equity markets. The S&P 500 is on course for its biggest monthly gain since 1987.
By Alan Rappeport in New York
Copyright The Financial Times Limited 2009
Published: March 27 2009 13:21 | Last updated: March 27 2009 14:41
http://www.ft.com/cms/s/0/bab4794c-1ad0-11de-8aa3-0000779fd2ac.html
US consumers upped their spending for the second month running in February as prices rose, but concerns over falling incomes left the savings rate near last month’s 14-year high.
Personal consumption expenditure rose by 0.2 per cent, in line with economists’ expectations, according to commerce department figures released on Friday. The February rise followed a revised 1 per cent increase in January, which broke a record streak of six consecutive declines.
Economists expect that consumer spending could increase by an annual rate of 1 per cent in the first quarter of this year after falling by 4 per cent during the second half of last year. Recent figures showed that retail sales have stabilised during the last two months, falling by 0.1 per cent in February after jumping by 1.8 per cent in January.
Incomes fell back in February, with personal income declining by 0.2 per cent for the second consecutive month. The drop was largely due to rising job cuts, pay freezes and eliminated bonuses.
The commerce department’s closely watched gauge of prices rose 0.3 per cent in February, the same rate as in January, and showed a 0.2 per cent increase excluding food and energy for the second month running. Year-on-year core prices are up 1.8 per cent.
That should ease fears that the US downturn could lead to a deflationary trap. The labour department’s February consumer price index rose by 0.4 per cent on higher energy prices.
Meanwhile the savings rate, which is measured as the proportion of income left after spending and taxes, slipped from 4.4 percent to 4.2 per cent in February, retreating slightly from a 14-year high.
Consumers have curtailed spending in recent months as the economic recession has deepened. Earlier this month the Federal Reserve said that the net worth of US households plunged 18 per cent last year and 9 per cent last quarter, the biggest drops since tracking began in 1946.
“The US consumer is faced with daunting fundamentals,” said Joshua Shapiro, chief US economist at MFR. “Wage and salary income is declining, credit is very tight, home prices continue to fall, financial asset values have been decimated, and household balance sheets are extremely stressed.”
Such conditions kept consumer sentiment, as reported on Friday by the University of Michigan’s index, depressed this month. Sentiment rose to 57.3 in March from a revised 56.3 the prior month, in a reading that was slightly more optimistic than analysts expected. The index, produced jointly with Reuters, bottomed at 51.7 in 1980.
Falling incomes and dim sentiment reflect the impact of the deteriorating employment situation. In February the unemployment rate jumped from 7.6 per cent to 8.1 per cent, its highest level since 1983, as the number of jobs lost reached 651,000. Economists expect that another 700,000 jobs could be lost this month and that the official employment report next week could show the jobless rate reaching 8.5 per cent.
Feelings about current conditions slipped this month but expectations ticked up, as consumers took hope from rebounding equity markets. The S&P 500 is on course for its biggest monthly gain since 1987.
US to take fight to Pakistan border area
US to take fight to Pakistan border area
By Demetri Sevastopulo, Daniel Dombey and Andrew Ward in Washington
Copyright The Financial Times Limited 2009
Published: March 27 2009 15:18 | Last updated: March 27 2009 23:23
http://www.ft.com/cms/s/0/684a386a-1ae2-11de-8aa3-0000779fd2ac.html
President Barack Obama on Friday unveiled a new strategy for Afghanistan that shifts the focus to defeating al-Qaeda and Taliban militants operating from neighbouring Pakistan.
Calling the situation in Afghanistan “increasingly perilous”, the US president sought to rally the American people and the world around a conflict that some US generals have called the “forgotten war”. He called al-Qaeda a “cancer that risks killing Pakistan from within”.
Mr Obama stressed that the US goal for Afghanistan would be defeating al-Qaeda, and not the aim of building a democracy pushed by the Bush administration. Emphasising the need to deal with militant havens inside Pakistan, he said the “most dangerous place in the world” for America was the border area.
“Multiple intelligence estimates have warned that al-Qaeda is actively planning attacks on the US homeland from its safe haven in Pakistan.”
Pakistan’s president Asif Ali Zardari welcomed the review’s findings, which saw Mr Obama urge Congress to pass legislation that would provide Pakistan with $7.5bn in assistance over five years to improve infrastructure and strengthen its democracy.
Mr Obama also pledged to send more civilian experts, such as agricultural specialists, which the US military and allies have complained have been lacking.
European foreign ministers welcomed the strategy, saying they would step up their commitment to Afghanistan. But diplomats warned that there was little time for Nato members to agree on sending more personnel and resources to Afghanistan
By Demetri Sevastopulo, Daniel Dombey and Andrew Ward in Washington
Copyright The Financial Times Limited 2009
Published: March 27 2009 15:18 | Last updated: March 27 2009 23:23
http://www.ft.com/cms/s/0/684a386a-1ae2-11de-8aa3-0000779fd2ac.html
President Barack Obama on Friday unveiled a new strategy for Afghanistan that shifts the focus to defeating al-Qaeda and Taliban militants operating from neighbouring Pakistan.
Calling the situation in Afghanistan “increasingly perilous”, the US president sought to rally the American people and the world around a conflict that some US generals have called the “forgotten war”. He called al-Qaeda a “cancer that risks killing Pakistan from within”.
Mr Obama stressed that the US goal for Afghanistan would be defeating al-Qaeda, and not the aim of building a democracy pushed by the Bush administration. Emphasising the need to deal with militant havens inside Pakistan, he said the “most dangerous place in the world” for America was the border area.
“Multiple intelligence estimates have warned that al-Qaeda is actively planning attacks on the US homeland from its safe haven in Pakistan.”
Pakistan’s president Asif Ali Zardari welcomed the review’s findings, which saw Mr Obama urge Congress to pass legislation that would provide Pakistan with $7.5bn in assistance over five years to improve infrastructure and strengthen its democracy.
Mr Obama also pledged to send more civilian experts, such as agricultural specialists, which the US military and allies have complained have been lacking.
European foreign ministers welcomed the strategy, saying they would step up their commitment to Afghanistan. But diplomats warned that there was little time for Nato members to agree on sending more personnel and resources to Afghanistan
Friday, March 27, 2009
Same-sex marriage: At Loyola University, advocates of same-sex marriage find a voice
Same-sex marriage: At Loyola University, advocates of same-sex marriage find a voice
By Mary Schmich
March 27, 2009
http://www.chicagotribune.com/news/columnists/chi-schmich-27-mar27,0,5736306.column
When John Litchfield, who's 26, enrolled at Loyola University's Chicago School of Law three years ago, he went to the student activities fair looking for the gay and lesbian support group. There wasn't one.
The lack of an official gay group at a Catholic school might not surprise you since the Roman Catholic church deems homosexual behavior a sin. But Litchfield was surprised. He had come to Loyola convinced that he'd be as accepted there as he was by his Catholic grandmother in Flossmoor, the south suburb where he grew up.
"I thought, OK, I know I'm not the only one here," he said when we met on Thursday.
"Where are they?"
He found them. That year, he and a few other gay students formed a group, called OUTlaw. One of the deans signed on as an adviser.
And on Thursday, the flat-screen TVs all over the law school were advertising the group's latest venture: a big symposium on same-sex marriage.
If Loyola were a public school, I might have deleted Litchfield's e-mail about the symposium. Life is heavy with press releases. But the fact that one of Chicago's Catholic institutions was opening its grand "ceremonial courtroom" to same-sex marriage advocates seemed worth some consideration.
"I think this reflects young Catholics in Chicago," said Litchfield, a slender guy with short auburn hair, neatly dressed in slacks, a white shirt and a navy pullover sweater. When I arrived, he'd been reading a news article—new rules for hedge funds—on his iPod.
"People in this age group, 22 to 30," he went on, "are mature, able to think things through."
He doesn't mean that all young Catholics think gays should be allowed to marry. But except for a single instance in his first year—someone ripped the group's posters off a wall in a locker room—he's felt entirely supported at this school where crucifixes hang in the classrooms.
Litchfield wasn't raised Catholic, but—"I know it sounds really schmaltzy"—Loyola feels like family. He points out that it's not just Catholic, it's run by Jesuit priests.
"The Jesuits value diversity," he said. "They value education and discourse. If you're pro-choice or you're gay, you're someone who can add to the discussion."
And so on Friday there will be a discussion.
Greg Harris, the Chicago state representative who is shepherding a civil-unions bill through the Illinois legislature, will be on the panel. So will lawyers pressing for same-sex marriage in Iowa and California.
The panelists will be there to advocate. Litchfield anticipates students who will come to argue. It's all part of the education.
Litchfield himself isn't ready to be married.
"But when I am," he said, "I want my devotion to this person to be recognized the same way my parents' devotion to each other is recognized. I want my kids to be able to say, 'Yeah, my parents are married.' "
After a while, we walked over to the ceremonial courtroom where the symposium will be held. The ceilings soared, and Chicago rose across the walls of windows.
Out in the changing, growing city, old buildings crowded next to new ones, and next to buildings so freshly under construction that you couldn't know exactly what they'd look like, only that one day soon they'd be there, and that once they were there, we'd take them for granted.
Just like, I'm betting, same-sex marriage.
For information on the symposium, go to chicagotribune.com/conference
By Mary Schmich
March 27, 2009
http://www.chicagotribune.com/news/columnists/chi-schmich-27-mar27,0,5736306.column
When John Litchfield, who's 26, enrolled at Loyola University's Chicago School of Law three years ago, he went to the student activities fair looking for the gay and lesbian support group. There wasn't one.
The lack of an official gay group at a Catholic school might not surprise you since the Roman Catholic church deems homosexual behavior a sin. But Litchfield was surprised. He had come to Loyola convinced that he'd be as accepted there as he was by his Catholic grandmother in Flossmoor, the south suburb where he grew up.
"I thought, OK, I know I'm not the only one here," he said when we met on Thursday.
"Where are they?"
He found them. That year, he and a few other gay students formed a group, called OUTlaw. One of the deans signed on as an adviser.
And on Thursday, the flat-screen TVs all over the law school were advertising the group's latest venture: a big symposium on same-sex marriage.
If Loyola were a public school, I might have deleted Litchfield's e-mail about the symposium. Life is heavy with press releases. But the fact that one of Chicago's Catholic institutions was opening its grand "ceremonial courtroom" to same-sex marriage advocates seemed worth some consideration.
"I think this reflects young Catholics in Chicago," said Litchfield, a slender guy with short auburn hair, neatly dressed in slacks, a white shirt and a navy pullover sweater. When I arrived, he'd been reading a news article—new rules for hedge funds—on his iPod.
"People in this age group, 22 to 30," he went on, "are mature, able to think things through."
He doesn't mean that all young Catholics think gays should be allowed to marry. But except for a single instance in his first year—someone ripped the group's posters off a wall in a locker room—he's felt entirely supported at this school where crucifixes hang in the classrooms.
Litchfield wasn't raised Catholic, but—"I know it sounds really schmaltzy"—Loyola feels like family. He points out that it's not just Catholic, it's run by Jesuit priests.
"The Jesuits value diversity," he said. "They value education and discourse. If you're pro-choice or you're gay, you're someone who can add to the discussion."
And so on Friday there will be a discussion.
Greg Harris, the Chicago state representative who is shepherding a civil-unions bill through the Illinois legislature, will be on the panel. So will lawyers pressing for same-sex marriage in Iowa and California.
The panelists will be there to advocate. Litchfield anticipates students who will come to argue. It's all part of the education.
Litchfield himself isn't ready to be married.
"But when I am," he said, "I want my devotion to this person to be recognized the same way my parents' devotion to each other is recognized. I want my kids to be able to say, 'Yeah, my parents are married.' "
After a while, we walked over to the ceremonial courtroom where the symposium will be held. The ceilings soared, and Chicago rose across the walls of windows.
Out in the changing, growing city, old buildings crowded next to new ones, and next to buildings so freshly under construction that you couldn't know exactly what they'd look like, only that one day soon they'd be there, and that once they were there, we'd take them for granted.
Just like, I'm betting, same-sex marriage.
For information on the symposium, go to chicagotribune.com/conference
Pet-related injuries? They do happen
Pet-related injuries? They do happen
About 86,000 people are hurt each year in accidents involving their pets -- usually by tripping over them, a CDC study says. That figure, however, represents only 1% of injuries from falls.
By Carla Hall
Copyright © 2009, The Los Angeles Times
March 27, 2009
http://www.chicagotribune.com/news/nationworld/la-na-pet-falls27-2009mar27,0,6082292.story
People are always falling for their pets. Apparently, some are falling over them, too.
About 86,000 injuries each year occur when good people go klutzy around their animals and end up in emergency rooms. Most stumble over their cats and dogs. Others get pushed or pulled by a dog on a walk -- or are doing the chasing themselves. Some pet owners are tripped up by food bowls and pet toys.
That said, such mishaps are relatively rare, accounting for only 1% of injuries from falls, according to a Centers for Disease Control and Prevention report released Thursday.
Most of the injured were treated and released, according to researchers who looked at emergency room reports for 66 U.S. hospitals from 2001 through 2006.
"I wouldn't say it's common," said Dr. Frederick Carr, medical director of the emergency department at Providence Little Company of Mary Medical Center Torrance. "I see many more people who trip over curbs and speed bumps. I see one or two of those a day."
Carr recalled, however, that when his elderly mother house-sat for him once, "she tripped over the dog and sustained many cuts. She needed some stitches."
The CDC study said the rate of injury was higher for the elderly.
But pet owners proudly said their animals did not contribute to those statistics. Laura Trope, owner of Lakal Jewelry in Brentwood, brings her Dachshund, Jill, to the store every day.
"No one has fallen over her yet -- and she's definitely close to the ground and hard to see," Trope said.
Most cat owners are aware of their felines' risky predilection for weaving around their owners' legs.
"I love it when they cut me off at the pass," said Kathy Riordan, an L.A. Animal Services Commissioner and the owner of multiple cats. "In all the times they've cut me off, I've never fallen. But I have fallen wearing high heels."
Not mentioned in the report were possible injuries sustained by pooches and kitties bearing the brunt of their stumbling owners.
"Back in 1991, I stepped on my cat's paw," Riordan said. "I felt terrible. We had it X-rayed, and he was fine. But for the remaining 16 years of his life, he would lift a paw and I would run over and apologize."
carla.hall@latimes.com
About 86,000 people are hurt each year in accidents involving their pets -- usually by tripping over them, a CDC study says. That figure, however, represents only 1% of injuries from falls.
By Carla Hall
Copyright © 2009, The Los Angeles Times
March 27, 2009
http://www.chicagotribune.com/news/nationworld/la-na-pet-falls27-2009mar27,0,6082292.story
People are always falling for their pets. Apparently, some are falling over them, too.
About 86,000 injuries each year occur when good people go klutzy around their animals and end up in emergency rooms. Most stumble over their cats and dogs. Others get pushed or pulled by a dog on a walk -- or are doing the chasing themselves. Some pet owners are tripped up by food bowls and pet toys.
That said, such mishaps are relatively rare, accounting for only 1% of injuries from falls, according to a Centers for Disease Control and Prevention report released Thursday.
Most of the injured were treated and released, according to researchers who looked at emergency room reports for 66 U.S. hospitals from 2001 through 2006.
"I wouldn't say it's common," said Dr. Frederick Carr, medical director of the emergency department at Providence Little Company of Mary Medical Center Torrance. "I see many more people who trip over curbs and speed bumps. I see one or two of those a day."
Carr recalled, however, that when his elderly mother house-sat for him once, "she tripped over the dog and sustained many cuts. She needed some stitches."
The CDC study said the rate of injury was higher for the elderly.
But pet owners proudly said their animals did not contribute to those statistics. Laura Trope, owner of Lakal Jewelry in Brentwood, brings her Dachshund, Jill, to the store every day.
"No one has fallen over her yet -- and she's definitely close to the ground and hard to see," Trope said.
Most cat owners are aware of their felines' risky predilection for weaving around their owners' legs.
"I love it when they cut me off at the pass," said Kathy Riordan, an L.A. Animal Services Commissioner and the owner of multiple cats. "In all the times they've cut me off, I've never fallen. But I have fallen wearing high heels."
Not mentioned in the report were possible injuries sustained by pooches and kitties bearing the brunt of their stumbling owners.
"Back in 1991, I stepped on my cat's paw," Riordan said. "I felt terrible. We had it X-rayed, and he was fine. But for the remaining 16 years of his life, he would lift a paw and I would run over and apologize."
carla.hall@latimes.com
New documentary challenges gender stereotypes
New documentary challenges gender stereotypes
By Amy Wooten
Copyright by The Chicago Free Press
March 25, 2009
http://www.chicagofreepress.com/node/3301
A new documentary about the harmful effects of gender stereotypes and homophobia among high school-aged teens that aims to spark dialogue and action is making its Midwest debut.
Illinois Safe Schools Alliance, in partnership with Groundspark, will screen the feature-length documentary “Straightlaced: How Gender’s Got Us All Tied Up” on April 7.
Groundspark executive director Debra Chasnoff, best known for her groundbreaking film, “It’s Elementary: Talking About Gay Issues in School,” also directed “Straightlaced.” In her new film, over 50 teens from all walks of life open up during candid interviews about how gender role expectations and homophobia impact them on a daily basis.
“There is something in this film that everyone can relate to,” Chasnoff said, noting that most of the teens interviewed identified as straight. She hopes that the film inspires teens, teachers and others to check the ways in which they limit themselves and others because of gender role expectations and anti-gay attitudes. She also hopes that people are inspired to take action and create change.
Chasnoff feels that since “It’s Elementary” debuted, schools are more willing to discusses issues like homophobia. She finds it promising that many school districts have put great policies in place, but is saddened that many schools “still don’t put muscle behind” ensuring these policies are followed.
“There is still a real gap between awareness and action,” Chasnoff added.
The event, which benefits Illinois Safe Schools Alliance, starts at 7 p.m. at Oak Park River Forest High School, 201 N. Scoville. Get tickets ($10 for students and $20 for adults) at groundspark.com/upcoming-screenings. The organization also encourages individuals to sponsor student tickets and help local schools bring their Gay-Straight Alliances to the event.
By Amy Wooten
Copyright by The Chicago Free Press
March 25, 2009
http://www.chicagofreepress.com/node/3301
A new documentary about the harmful effects of gender stereotypes and homophobia among high school-aged teens that aims to spark dialogue and action is making its Midwest debut.
Illinois Safe Schools Alliance, in partnership with Groundspark, will screen the feature-length documentary “Straightlaced: How Gender’s Got Us All Tied Up” on April 7.
Groundspark executive director Debra Chasnoff, best known for her groundbreaking film, “It’s Elementary: Talking About Gay Issues in School,” also directed “Straightlaced.” In her new film, over 50 teens from all walks of life open up during candid interviews about how gender role expectations and homophobia impact them on a daily basis.
“There is something in this film that everyone can relate to,” Chasnoff said, noting that most of the teens interviewed identified as straight. She hopes that the film inspires teens, teachers and others to check the ways in which they limit themselves and others because of gender role expectations and anti-gay attitudes. She also hopes that people are inspired to take action and create change.
Chasnoff feels that since “It’s Elementary” debuted, schools are more willing to discusses issues like homophobia. She finds it promising that many school districts have put great policies in place, but is saddened that many schools “still don’t put muscle behind” ensuring these policies are followed.
“There is still a real gap between awareness and action,” Chasnoff added.
The event, which benefits Illinois Safe Schools Alliance, starts at 7 p.m. at Oak Park River Forest High School, 201 N. Scoville. Get tickets ($10 for students and $20 for adults) at groundspark.com/upcoming-screenings. The organization also encourages individuals to sponsor student tickets and help local schools bring their Gay-Straight Alliances to the event.
Microbicide advocates stress options - Researchers hope microbicides are the next step in the fight against HIV/AIDS.
Microbicide advocates stress options - Researchers hope microbicides are the next step in the fight against HIV/AIDS.
By Amy Wooten
Copyright by The Chicago Free Press
March 25, 2009
http://www.chicagofreepress.com/node/3299
With over 33 million people living with HIV/AIDS across the globe, advocates stress that more prevention options are needed, and a product currently in development—microbicides—could potentially save millions of people from infection.
Microbicides have for years been in development to reduce HIV transmission, and some even aim to prevent other STDs, as well. But since the rectum and vagina are biologically very different, safe and effective microbicides for both areas need to be developed.
The rectum is what AIDS Foundation of Chicago (AFC) Director of Advocacy and International Rectal Microbicides Advocates (IRMA) chair Jim Pickett describes as “the perfect storm” for HIV infection. Although women will primarily use vaginal microbicides, safety trials are being conducted to determine if they are safe for anal use. Both men and women will ideally utilize rectal microbicides.
According to AFC policy manager Jessica Terlikowski, Chicago has been a hub for microbicide activism.
“This is the city where microbicide advocacy has been taking place for the last 10 years,” Terlikowski said.
That is why advocates are ecstatic that an upcoming clinical trial of a vaginal microbicide gel will take place in Chicago, as well as other cities. Terlikowski said that the trial would most likely be launched this summer and added that support for microbicide research and development is on the rise.
“There has been a groundswell of both intellectual and monetary investments,” according to Terlikowski.
Between fiscal year 1999 and fiscal year 2008, the USA Agency for International Development’s funding for such research and development has increased nearly 20-fold.
The Obama White House is supportive of microbicide research and development as well, and included it in the White House agenda. In fact, while a U.S. senator, President Barack Obama introduced the Microbicide Development Act.
Pickett said the support from the top leaves advocates feeling very optimistic.
“We don’t have to deny behavior and pretend gay people don’t exist” to get government dollars,” he said, adding that under the Bush regime scientists had to quietly conduct rectal microbicide research for fear of getting their funding pulled.
This increased attention has allowed scientists to make headway. New research suggests that a vaginal gel called Pro 2000 lessened the risk of infection. Pickett said the initial study’s results, while not statistically significant, still “offer the first glimmer of hope” for the field. A much larger study of Pro 2000 is now taking place.
While interest and support of vaginal microbicides has increased over the years, support for rectal microbicides—which could greatly impact the gay community—is not as strong.
According to Pickett, the rectal microbicide field is “significantly behind” for various reasons. For one, funding is hard to come by, and the current economic crisis won’t make things easier. Data on sexual behavior, even today, is spotty. Also, anal sex is an issue still not widely discussed because of the stigma attached to it and homophobia.
“This is typical of anything that has to do with anal sex or gay men,” Pickett said. “We need to take away the moral component and the judgment and focus on saving lives.”
Regardless, headway has been made. UCLA recently conducted the world’s first rectal microbicide safety trial, and several more Phase 1 safety trials are already planned or underway. Safety trials of vaginal microbicides used rectally have taken place, as well.
International Rectal Microbicides Advocates, an organization created in 2005 by a handful of individuals that now boasts nearly 900 members, calls for rectal microbicide funding to increase five-fold by 2010, from $7 million in U.S. funding per year to $35 million. A large bulk of current rectal microbicide funding comes from the NIH, which accounts for over half of federal microbicide (rectal and vaginal) research dollars.
Advocates emphasize that gay men aren’t the only ones having anal sex. Between 10-35 percent of straight women and up to 40 percent of men in the U.S. practice anal sex. Studies also show that more straight women than gay men in the U.S. practice receptive anal sex, and that heterosexual anal sex is largely practiced unprotected.
According to IRMA, even a 60 percent effective microbicide used by 20 percent of sexually active people in over 70 low-income countries could prevent 2.5 million HIV infections over the course of three years.
Advocates additionally point out that condom use will not disappear with the eventual availability of microbicides, and that they will continue to stress condom use, which is believed to be 98 percent effective. Advocates say microbicides will, rather, become a part of a comprehensive prevention strategy.
“They won’t replace condoms,” Terlikowski said. “Condoms still serve as the gold standard.”
Microbicides additionally can be useful for those who don’t use condoms at all. Vaginal microbicides are particularly important for women who can’t negotiate condom use in a relationship for fear of physical abuse, which is often the case in poorer countries. In sub-Saharan Africa, where 60 percent of those with HIV are women, less than 7 percent of women reported using a condom the last time they had sex with their primary partner. A vaginal gel, however, can be applied secretly.
There are also no options for those who simply don’t want to use condoms. And although many gay men have lessoned their risk over the years by methods like serosorting, microbicides could further reduce their risk. While some believe that advocating alternatives to the condom equates advocating unprotected sex, microbicide advocates like Pickett quip that something is far better than nothing.
“It’s a false argument,” he said. “If you aren’t using a condom, you have no protection. Wouldn’t something that’s even 60 percent effective be great in comparison?”
Terlikowski, who is also a strong female condom advocate, feels that in order to reduce infection rates, people need a variety of affordable and accessible choices. She said that doing female condom advocacy “helped lay the groundwork for microbicides.”
“I find it absolutely ridiculous we’ve been so satisfied with one option,” Pickett said. “After all, we’re a consumer culture. We don’t accept that in any other aspect of our lives.”
By Amy Wooten
Copyright by The Chicago Free Press
March 25, 2009
http://www.chicagofreepress.com/node/3299
With over 33 million people living with HIV/AIDS across the globe, advocates stress that more prevention options are needed, and a product currently in development—microbicides—could potentially save millions of people from infection.
Microbicides have for years been in development to reduce HIV transmission, and some even aim to prevent other STDs, as well. But since the rectum and vagina are biologically very different, safe and effective microbicides for both areas need to be developed.
The rectum is what AIDS Foundation of Chicago (AFC) Director of Advocacy and International Rectal Microbicides Advocates (IRMA) chair Jim Pickett describes as “the perfect storm” for HIV infection. Although women will primarily use vaginal microbicides, safety trials are being conducted to determine if they are safe for anal use. Both men and women will ideally utilize rectal microbicides.
According to AFC policy manager Jessica Terlikowski, Chicago has been a hub for microbicide activism.
“This is the city where microbicide advocacy has been taking place for the last 10 years,” Terlikowski said.
That is why advocates are ecstatic that an upcoming clinical trial of a vaginal microbicide gel will take place in Chicago, as well as other cities. Terlikowski said that the trial would most likely be launched this summer and added that support for microbicide research and development is on the rise.
“There has been a groundswell of both intellectual and monetary investments,” according to Terlikowski.
Between fiscal year 1999 and fiscal year 2008, the USA Agency for International Development’s funding for such research and development has increased nearly 20-fold.
The Obama White House is supportive of microbicide research and development as well, and included it in the White House agenda. In fact, while a U.S. senator, President Barack Obama introduced the Microbicide Development Act.
Pickett said the support from the top leaves advocates feeling very optimistic.
“We don’t have to deny behavior and pretend gay people don’t exist” to get government dollars,” he said, adding that under the Bush regime scientists had to quietly conduct rectal microbicide research for fear of getting their funding pulled.
This increased attention has allowed scientists to make headway. New research suggests that a vaginal gel called Pro 2000 lessened the risk of infection. Pickett said the initial study’s results, while not statistically significant, still “offer the first glimmer of hope” for the field. A much larger study of Pro 2000 is now taking place.
While interest and support of vaginal microbicides has increased over the years, support for rectal microbicides—which could greatly impact the gay community—is not as strong.
According to Pickett, the rectal microbicide field is “significantly behind” for various reasons. For one, funding is hard to come by, and the current economic crisis won’t make things easier. Data on sexual behavior, even today, is spotty. Also, anal sex is an issue still not widely discussed because of the stigma attached to it and homophobia.
“This is typical of anything that has to do with anal sex or gay men,” Pickett said. “We need to take away the moral component and the judgment and focus on saving lives.”
Regardless, headway has been made. UCLA recently conducted the world’s first rectal microbicide safety trial, and several more Phase 1 safety trials are already planned or underway. Safety trials of vaginal microbicides used rectally have taken place, as well.
International Rectal Microbicides Advocates, an organization created in 2005 by a handful of individuals that now boasts nearly 900 members, calls for rectal microbicide funding to increase five-fold by 2010, from $7 million in U.S. funding per year to $35 million. A large bulk of current rectal microbicide funding comes from the NIH, which accounts for over half of federal microbicide (rectal and vaginal) research dollars.
Advocates emphasize that gay men aren’t the only ones having anal sex. Between 10-35 percent of straight women and up to 40 percent of men in the U.S. practice anal sex. Studies also show that more straight women than gay men in the U.S. practice receptive anal sex, and that heterosexual anal sex is largely practiced unprotected.
According to IRMA, even a 60 percent effective microbicide used by 20 percent of sexually active people in over 70 low-income countries could prevent 2.5 million HIV infections over the course of three years.
Advocates additionally point out that condom use will not disappear with the eventual availability of microbicides, and that they will continue to stress condom use, which is believed to be 98 percent effective. Advocates say microbicides will, rather, become a part of a comprehensive prevention strategy.
“They won’t replace condoms,” Terlikowski said. “Condoms still serve as the gold standard.”
Microbicides additionally can be useful for those who don’t use condoms at all. Vaginal microbicides are particularly important for women who can’t negotiate condom use in a relationship for fear of physical abuse, which is often the case in poorer countries. In sub-Saharan Africa, where 60 percent of those with HIV are women, less than 7 percent of women reported using a condom the last time they had sex with their primary partner. A vaginal gel, however, can be applied secretly.
There are also no options for those who simply don’t want to use condoms. And although many gay men have lessoned their risk over the years by methods like serosorting, microbicides could further reduce their risk. While some believe that advocating alternatives to the condom equates advocating unprotected sex, microbicide advocates like Pickett quip that something is far better than nothing.
“It’s a false argument,” he said. “If you aren’t using a condom, you have no protection. Wouldn’t something that’s even 60 percent effective be great in comparison?”
Terlikowski, who is also a strong female condom advocate, feels that in order to reduce infection rates, people need a variety of affordable and accessible choices. She said that doing female condom advocacy “helped lay the groundwork for microbicides.”
“I find it absolutely ridiculous we’ve been so satisfied with one option,” Pickett said. “After all, we’re a consumer culture. We don’t accept that in any other aspect of our lives.”
Chicago Free Press Editorial: It’s about time
Chicago Free Press Editorial: It’s about time
Copyright by The Chicago Free Press
March 25, 2009
http://www.chicagofreepress.com/node/3306
International GLBT communities received good news last week when the Obama administration signed onto a U.N. declaration calling for the worldwide decriminalization of homosexuality.
Former President George W. Bush had refused to sign the declaration late last year, making for yet another blot on both the U.S.’ track records on overall human rights and GLBT rights in particular.
Our country had been the only western nation not to add its name to the nonbinding declaration. The entire European Union, as well as Australia, Japan and Mexico, all signed. The other notable absence from the declaration was, not surprisingly, the Vatican.
The signing last week, of course, probably will cost President Obama relatively little political capital. Even the most strident foes of the gay community would dare argue in public that international GLBTs should not have the right to be left alone by hostile governments.
But we nevertheless congratulate President Obama and his administration on the signing. It is one step in reversing the Bush administration’s horrendous track record on human rights. Our country had moved to the point wherein we were debating the relative merits of torture, so it was to no one’s surprise that Bush would refuse to put his neck on the line for a constituency whose mere existence incited the ire of his base.
The declaration also represents an early step by the president in demonstrating a commitment to the GLBT community. He has made numerous promises to us, from overturning the ban on gays in the military to initiating a comprehensive policy on HIV/AIDS. We’ve been concerned that the administration will drag its feet on these promises; overturning Don’t Ask, Don’t Tell, for example, seems to have gotten moved to the back burner for the time being.
But this is at least a good start on the president’s behalf, joining the rest of the world in speaking out on GLBTs who are oppressed and live under the threat of persecution. Some 70 U.N. nations outlaw homosexuality and more than 50 opposed the declaration.
For now, we’re at least pleased that our president has moved the United States to the right side of this battle.
Copyright by The Chicago Free Press
March 25, 2009
http://www.chicagofreepress.com/node/3306
International GLBT communities received good news last week when the Obama administration signed onto a U.N. declaration calling for the worldwide decriminalization of homosexuality.
Former President George W. Bush had refused to sign the declaration late last year, making for yet another blot on both the U.S.’ track records on overall human rights and GLBT rights in particular.
Our country had been the only western nation not to add its name to the nonbinding declaration. The entire European Union, as well as Australia, Japan and Mexico, all signed. The other notable absence from the declaration was, not surprisingly, the Vatican.
The signing last week, of course, probably will cost President Obama relatively little political capital. Even the most strident foes of the gay community would dare argue in public that international GLBTs should not have the right to be left alone by hostile governments.
But we nevertheless congratulate President Obama and his administration on the signing. It is one step in reversing the Bush administration’s horrendous track record on human rights. Our country had moved to the point wherein we were debating the relative merits of torture, so it was to no one’s surprise that Bush would refuse to put his neck on the line for a constituency whose mere existence incited the ire of his base.
The declaration also represents an early step by the president in demonstrating a commitment to the GLBT community. He has made numerous promises to us, from overturning the ban on gays in the military to initiating a comprehensive policy on HIV/AIDS. We’ve been concerned that the administration will drag its feet on these promises; overturning Don’t Ask, Don’t Tell, for example, seems to have gotten moved to the back burner for the time being.
But this is at least a good start on the president’s behalf, joining the rest of the world in speaking out on GLBTs who are oppressed and live under the threat of persecution. Some 70 U.N. nations outlaw homosexuality and more than 50 opposed the declaration.
For now, we’re at least pleased that our president has moved the United States to the right side of this battle.
Heartbreaking triage as Fargo battles floods
Heartbreaking triage as Fargo battles floods
By Monica Davey
Copyright by The International Herald Tribune
Published: March 27, 2009
http://www.iht.com/articles/2009/03/27/america/27flood.php
FARGO, North Dakota: For some residents in the neighborhoods closest to the fast-rising Red River here, the last-minute announcement by anxious city officials that they would build a second set of dikes to protect the heart of this state's most populous city was anything but soothing.
In fact, hundreds of homeowners now could find their properties sandwiched between the city's first 12-mile-long dike and the new line of defense. Record water levels are expected by Friday afternoon.
"What you're saying here is that we're on the wrong side of the world?" Laura Krupich, a resident of the South Acres neighborhood in Fargo, asked a city commissioner as she found her house on a map showing the new earthen and sandbag levees.
Ms. Krupich's house, according to city planners' estimates, may not be protected by the city's second "contingency" dikes. There was even concern that houses between the two sets of dikes could be in particular danger if the first one breaks but the second one holds.
It was an alarming prospect, particularly as weather forecasters said the river would rise still higher than expected, nearly two feet higher than its record nearly a century ago. Later in the day, city officials recommended that people living in homes between the dikes consider evacuating.
"These are brutal choices," said Dave Piepkorn, the commissioner. With a pained look, he told Ms. Krupich that he hoped the city's first line of defense would hold but that she should be prepared to get out fast. Park your cars elsewhere, Mr. Piepkorn said. Plug your toilets.
"You know these are people's houses we're talking about, and it just gets to you," he said later, shaking his head. "But we also have to be responsible for the city as a whole."
So went many of the troubling decisions here and elsewhere in North Dakota and Minnesota this week, where river and stream levels have overwhelmed communities, swamped some homes and roads and rural towns, and are threatening cities like this one.
The authorities here had to choose which roads to plow when snow just kept falling and which to leave impassible. They had to pick where to pile sandbags still higher and where not to. And in some low-lying sections already full of frigid waters, they had to decide which people to evacuate first by airboat.
"We are not abandoning anybody," Mayor Dennis Walaker of Fargo said, after hearing from nervous and upset residents who were told they would soon find themselves sitting "on the wrong side" of the planned second line of levees. "That was never the intent." Mr. Walaker estimated that a thousand homes lay between the dikes.
Still, the mayor said that given the record amount of water now expected here — the icy river was already sloshing up against the bridges that connect this city to neighboring Moorhead, Minnesota — Fargo needed to put extra protection around the bulk of the city and crucial elements of its infrastructure, like its water and sewer systems.
City officials also decided later in the day to make the dikes one foot higher and to close major arteries so they could be devoted to trucks carrying sand.
"We do not want to give up yet," Mr. Walaker said. "We want to go down swinging — if we go down."
In some rural areas to the south of this city and elsewhere, water had already filled homes. White caps, one law enforcement officer said, could be seen around what had once been farm fields. The authorities ordered about 100 people to evacuate, including residents of a nursing home, after cracks appeared in one dike. In Minnesota, evacuations were also ordered in Moorhead.
And while sheriff's officers south of Fargo rescued scores of people and animals from submerged — or soon to be submerged — homes, other residents, equipped with water, food and rubber waders said they were staying put. They were trying to protect their homes with rings of sandbags, though many of those homes were now unreachable because water covered roads all around them.
Around Bismarck, the state capital, flooded neighborhoods sat empty as demolition crews battled dangerous ice jams on the Missouri with explosives. Water levels had dropped some there, offering hope.
"Our biggest concern is an ice jam in the river just 10 miles north of Bismarck, which we're hoping does not dislodge," said Bill Wocken, that city's administrator. "An ice jam is kind of like my teenage daughter. Sometimes there is just no way to predict what they'll do next."
In Grand Forks, which was devastated by flooding in 1997, two of the three bridges leading in and out of town were already closed. But city officials seemed hopeful that a $409 million Army Corps of Engineers flood protection project, completed two years ago, would save the city from the Red River this time. "We remain cautious, vigilant and watchful," said Kevin Dean, a city spokesman.
In Fargo, near Harwood Drive, the second line of levees was expected to be built overnight on Thursday. Ten homes, among the fanciest in the city, were to be left between the old and new dikes.
"We'll be on the wrong side of that thing," said Ron Offutt, whose stately home sits at the end of the road. Mr. Offutt said, "We know that they've got to protect the rest of the city and we understand that."
But he said he and a team of his own warmly dressed workers had a project of their own under way: a four-foot-high ring of sandbags around his house.
Karen Ann Culotta contributed reporting from Chicago.
By Monica Davey
Copyright by The International Herald Tribune
Published: March 27, 2009
http://www.iht.com/articles/2009/03/27/america/27flood.php
FARGO, North Dakota: For some residents in the neighborhoods closest to the fast-rising Red River here, the last-minute announcement by anxious city officials that they would build a second set of dikes to protect the heart of this state's most populous city was anything but soothing.
In fact, hundreds of homeowners now could find their properties sandwiched between the city's first 12-mile-long dike and the new line of defense. Record water levels are expected by Friday afternoon.
"What you're saying here is that we're on the wrong side of the world?" Laura Krupich, a resident of the South Acres neighborhood in Fargo, asked a city commissioner as she found her house on a map showing the new earthen and sandbag levees.
Ms. Krupich's house, according to city planners' estimates, may not be protected by the city's second "contingency" dikes. There was even concern that houses between the two sets of dikes could be in particular danger if the first one breaks but the second one holds.
It was an alarming prospect, particularly as weather forecasters said the river would rise still higher than expected, nearly two feet higher than its record nearly a century ago. Later in the day, city officials recommended that people living in homes between the dikes consider evacuating.
"These are brutal choices," said Dave Piepkorn, the commissioner. With a pained look, he told Ms. Krupich that he hoped the city's first line of defense would hold but that she should be prepared to get out fast. Park your cars elsewhere, Mr. Piepkorn said. Plug your toilets.
"You know these are people's houses we're talking about, and it just gets to you," he said later, shaking his head. "But we also have to be responsible for the city as a whole."
So went many of the troubling decisions here and elsewhere in North Dakota and Minnesota this week, where river and stream levels have overwhelmed communities, swamped some homes and roads and rural towns, and are threatening cities like this one.
The authorities here had to choose which roads to plow when snow just kept falling and which to leave impassible. They had to pick where to pile sandbags still higher and where not to. And in some low-lying sections already full of frigid waters, they had to decide which people to evacuate first by airboat.
"We are not abandoning anybody," Mayor Dennis Walaker of Fargo said, after hearing from nervous and upset residents who were told they would soon find themselves sitting "on the wrong side" of the planned second line of levees. "That was never the intent." Mr. Walaker estimated that a thousand homes lay between the dikes.
Still, the mayor said that given the record amount of water now expected here — the icy river was already sloshing up against the bridges that connect this city to neighboring Moorhead, Minnesota — Fargo needed to put extra protection around the bulk of the city and crucial elements of its infrastructure, like its water and sewer systems.
City officials also decided later in the day to make the dikes one foot higher and to close major arteries so they could be devoted to trucks carrying sand.
"We do not want to give up yet," Mr. Walaker said. "We want to go down swinging — if we go down."
In some rural areas to the south of this city and elsewhere, water had already filled homes. White caps, one law enforcement officer said, could be seen around what had once been farm fields. The authorities ordered about 100 people to evacuate, including residents of a nursing home, after cracks appeared in one dike. In Minnesota, evacuations were also ordered in Moorhead.
And while sheriff's officers south of Fargo rescued scores of people and animals from submerged — or soon to be submerged — homes, other residents, equipped with water, food and rubber waders said they were staying put. They were trying to protect their homes with rings of sandbags, though many of those homes were now unreachable because water covered roads all around them.
Around Bismarck, the state capital, flooded neighborhoods sat empty as demolition crews battled dangerous ice jams on the Missouri with explosives. Water levels had dropped some there, offering hope.
"Our biggest concern is an ice jam in the river just 10 miles north of Bismarck, which we're hoping does not dislodge," said Bill Wocken, that city's administrator. "An ice jam is kind of like my teenage daughter. Sometimes there is just no way to predict what they'll do next."
In Grand Forks, which was devastated by flooding in 1997, two of the three bridges leading in and out of town were already closed. But city officials seemed hopeful that a $409 million Army Corps of Engineers flood protection project, completed two years ago, would save the city from the Red River this time. "We remain cautious, vigilant and watchful," said Kevin Dean, a city spokesman.
In Fargo, near Harwood Drive, the second line of levees was expected to be built overnight on Thursday. Ten homes, among the fanciest in the city, were to be left between the old and new dikes.
"We'll be on the wrong side of that thing," said Ron Offutt, whose stately home sits at the end of the road. Mr. Offutt said, "We know that they've got to protect the rest of the city and we understand that."
But he said he and a team of his own warmly dressed workers had a project of their own under way: a four-foot-high ring of sandbags around his house.
Karen Ann Culotta contributed reporting from Chicago.
Pakistani and Afghan Taliban Unify in Face of U.S. Influx /Suicide bomber kills 45 in Pakistan
Pakistani and Afghan Taliban Unify in Face of U.S. Influx
By CARLOTTA GALL
Copyright by tHe New York Times
Published: March 26, 2009
http://www.nytimes.com/2009/03/27/world/asia/27taliban.html?hp
ISLAMABAD, Pakistan — After agreeing to bury their differences and unite forces, Taliban leaders based in Pakistan have closed ranks with their Afghan comrades to ready a new offensive in Afghanistan as the United States prepares to send 17,000 more troops there this year.
In interviews, several Taliban fighters based in the border region said preparations for the anticipated influx of American troops were already being made. A number of new, younger commanders have been preparing to step up a campaign of roadside bombings and suicide attacks to greet the Americans, the fighters said.
The refortified alliance was forged after the reclusive Afghan Taliban leader, Mullah Muhammad Omar, sent emissaries to persuade Pakistani Taliban leaders to join forces and turn their attention to Afghanistan, Pakistani officials and Taliban members said.
The overture by Mullah Omar is an indication that with the prospect of an American buildup, the Taliban feel the need to strengthen their own forces in Afghanistan and to redirect their Pakistani allies toward blunting the new American push.
The Pakistani Taliban, an offspring of the Afghan Taliban, are led by veterans of the fighting in Afghanistan who come from the border regions. They have always supported the fight against foreign forces in Afghanistan by supplying fighters, training and logistical aid.
But in recent years the Pakistani Taliban have concentrated on battling the Pakistani government, extending a domain that has not only threatened Pakistan but has also provided an essential rear base for the Taliban insurgency in Afghanistan.
At the same time, American officials told The New York Times this week that Pakistan’s military intelligence agency continued to offer money, supplies and guidance to the Taliban insurgency in Afghanistan as a proxy to help shape a friendly government there once American forces leave.
The new Taliban alliance has raised concern in Afghanistan, where NATO generals warn that the conflict will worsen this year. It has also generated anxiety in Pakistan, where officials fear that a united Taliban will be more dangerous, even if focused on Afghanistan, and draw more attacks inside Pakistan from United States drone aircraft.
“This may bring some respite for us from militants’ attacks, but what it may entail in terms of national security could be far more serious,” said one senior Pakistani official, who spoke on condition of anonymity because he is not permitted to talk to news organizations. “This would mean more attacks inside our tribal areas, something we have been arguing against with the Americans.”
The Pakistani Taliban is dominated by three powerful commanders — Baitullah Mehsud, Hafiz Gul Bahadur and Maulavi Nazir — based in North and South Waziristan, the hub of insurgent activity in Pakistan’s tribal border regions, who have often clashed among themselves.
Mullah Omar dispatched a six-member team to Waziristan in late December and early January, several Taliban fighters said in interviews in Dera Ismail Khan, a town in North-West Frontier Province that is not far from South Waziristan. The Afghan Taliban delegation urged the Pakistani Taliban leaders to settle their internal differences, scale down their activities in Pakistan and help counter the planned increase of American forces in Afghanistan, the fighters said.
The three Pakistani Taliban leaders agreed. In February, they formed a united council, or shura, called the Council of United Mujahedeen. In a printed statement the leaders vowed to put aside their disputes and focus on fighting American-led forces in Afghanistan.
A spokesman for the Afghan Taliban, Zabiullah Mujahid, denied that the meetings ever took place or that any emissaries were sent by Mullah Omar. The Afghan Taliban routinely disavow any presence in Pakistan or connection to the Pakistani Taliban to emphasize that their movement is indigenous to Afghanistan. “We don’t like to be involved with them, as we have rejected all affiliation with Pakistani Taliban fighters,” Mr. Mujahid said. “We have sympathy for them as Muslims, but beside that, there is nothing else between us.”
Several Pakistani officials, who spoke on condition of anonymity because they were not permitted to talk to news organizations, confirmed the meetings. But they said that the overture might have been inspired by Sirajuddin Haqqani, an Afghan Taliban leader who swears allegiance to Mullah Omar but is largely independent in his operations.
Mr. Haqqani, and his father Jalaluddin Haqqani, the most powerful figures in Waziristan, are closely linked to Al Qaeda and to Pakistani intelligence, American officials say. From their base in North Waziristan, they have directed groups of fighters into eastern Afghanistan and increasingly in complex attacks on the Afghan capital, Kabul.
The Taliban fighters said the Afghan Taliban delegation was led by Mullah Abdullah Zakir, a commander from Helmand Province in southern Afghanistan, whose real name is reported to be Abdullah Ghulam Rasoul.
A front-line commander during the Taliban government, Mullah Zakir was captured in 2001 in northern Afghanistan and was detained at Guantánamo Bay, Cuba, until his release in 2007, Afghan Taliban members contacted by telephone said.
The Pakistani fighters described Mullah Zakir as an impressive speaker and a trainer, and one said he was particularly energetic in working to unite the different Taliban groups. Beyond bolstering Taliban forces in Afghanistan, both the Afghan and Pakistani Taliban leaders had other reasons to unite, Pakistani officials said.
One motivation may have been to shift the focus of hostilities to Afghanistan in hopes of improving their own security in Waziristan, where more than 30 drone strikes in recent months have been directed at both Mr. Mehsud and Mr. Nazir. Two senior commanders of the Haqqani network have been killed.
The Pakistani Taliban leaders also rely on Mr. Haqqani and their affiliation with the Afghan mujahedeen for legitimacy, as well as the money and influence it brings.
In their written statement, decorated with crossed swords, the three Pakistani Taliban leaders reaffirmed their allegiance to Mullah Omar, as well as the leader of Al Qaeda, Osama bin Laden.
The mujahedeen should unite as the “enemies” have united behind the leadership of President Obama, it said. “The mujahedeen should put aside their own differences for the sake of God, God’s happiness, for the strength of religion, and to bring dishonor on the infidels.” The Taliban fighters interviewed said that the top commanders removed a number of older commanders and appointed younger commanders who were good fighters to prepare for operations in Afghanistan in the coming weeks.
In confident spirits, the Taliban fighters predicted that 2009 was going to be a “very bloody” year.
Ismail Khan contributed reporting from Peshawar, Pakistan; Pir Zubair Shah from Dera Ismail Khan, Pakistan; and Taimoor Shah from Kandahar, Afghanistan.
Suicide bomber kills 45 in Pakistan
By Pir Zubair Shah and Alan Cowell
Copyright by The International Herald Tribune
Published: March 27, 2009
http://www.iht.com/articles/2009/03/27/asia/28pstan.php
ISLAMABAD, Pakistan: At least 45 people were killed and around 70 injured when a suicide bomber detonated explosives during Friday prayers at a mosque in the Khyber region of northwest Pakistan, according to news reports from the area and residents.
Reuters quoted Tariq Hayat Khan, the chief administrator of the region close to the Afghanistan border, as telling Geo TV that "45 to 46 bodies have been retrieved. Up to 70 people could have been killed." News reports said that about 250 worshippers may have been in the mosque at the time of the attack and that the death toll could rise sharply.
Mosques across the Islamic world are especially crowded on Fridays and the apparent scale of the attack dwarfed other recent attacks in the region.
The bombing came as President Barack Obama prepared to announce his new strategy to bolster American forces in Afghanistan and for the first time set benchmarks for progress in fighting Al Qaeda and the Taliban in both Afghanistan and Pakistan.
The mosque was located in the town of Bagiari on the main highway between Afghanistan and Pakistan which is used as a principle supply route for NATO and American forces in Afghanistan. After the attack, dozens of bodies were taken to a hospital in Jamrud while relatives removed others for burial, residents said.
Many of the dead were civilians, including children, with a handful of local security forces among them, residents reported.
Television news footage from the attack showed men in long robes and white skullcaps standing atop a wall overlooking the wreckage of the mosque and carrying corpses from the debris. A minaret with a loudspeaker jutted from the rubble.
Initial reports did not indicate any claim of responsibility for the attack, which came as news emerged that Taliban leaders in Pakistan had agreed to close ranks with their Afghan counterparts to confront a planned increase of 17,000 in the number of American troops in Afghanistan.
Pir Zubair Shah reported from Islamabad, Pakistan, and Alan Cowell from Paris.
By CARLOTTA GALL
Copyright by tHe New York Times
Published: March 26, 2009
http://www.nytimes.com/2009/03/27/world/asia/27taliban.html?hp
ISLAMABAD, Pakistan — After agreeing to bury their differences and unite forces, Taliban leaders based in Pakistan have closed ranks with their Afghan comrades to ready a new offensive in Afghanistan as the United States prepares to send 17,000 more troops there this year.
In interviews, several Taliban fighters based in the border region said preparations for the anticipated influx of American troops were already being made. A number of new, younger commanders have been preparing to step up a campaign of roadside bombings and suicide attacks to greet the Americans, the fighters said.
The refortified alliance was forged after the reclusive Afghan Taliban leader, Mullah Muhammad Omar, sent emissaries to persuade Pakistani Taliban leaders to join forces and turn their attention to Afghanistan, Pakistani officials and Taliban members said.
The overture by Mullah Omar is an indication that with the prospect of an American buildup, the Taliban feel the need to strengthen their own forces in Afghanistan and to redirect their Pakistani allies toward blunting the new American push.
The Pakistani Taliban, an offspring of the Afghan Taliban, are led by veterans of the fighting in Afghanistan who come from the border regions. They have always supported the fight against foreign forces in Afghanistan by supplying fighters, training and logistical aid.
But in recent years the Pakistani Taliban have concentrated on battling the Pakistani government, extending a domain that has not only threatened Pakistan but has also provided an essential rear base for the Taliban insurgency in Afghanistan.
At the same time, American officials told The New York Times this week that Pakistan’s military intelligence agency continued to offer money, supplies and guidance to the Taliban insurgency in Afghanistan as a proxy to help shape a friendly government there once American forces leave.
The new Taliban alliance has raised concern in Afghanistan, where NATO generals warn that the conflict will worsen this year. It has also generated anxiety in Pakistan, where officials fear that a united Taliban will be more dangerous, even if focused on Afghanistan, and draw more attacks inside Pakistan from United States drone aircraft.
“This may bring some respite for us from militants’ attacks, but what it may entail in terms of national security could be far more serious,” said one senior Pakistani official, who spoke on condition of anonymity because he is not permitted to talk to news organizations. “This would mean more attacks inside our tribal areas, something we have been arguing against with the Americans.”
The Pakistani Taliban is dominated by three powerful commanders — Baitullah Mehsud, Hafiz Gul Bahadur and Maulavi Nazir — based in North and South Waziristan, the hub of insurgent activity in Pakistan’s tribal border regions, who have often clashed among themselves.
Mullah Omar dispatched a six-member team to Waziristan in late December and early January, several Taliban fighters said in interviews in Dera Ismail Khan, a town in North-West Frontier Province that is not far from South Waziristan. The Afghan Taliban delegation urged the Pakistani Taliban leaders to settle their internal differences, scale down their activities in Pakistan and help counter the planned increase of American forces in Afghanistan, the fighters said.
The three Pakistani Taliban leaders agreed. In February, they formed a united council, or shura, called the Council of United Mujahedeen. In a printed statement the leaders vowed to put aside their disputes and focus on fighting American-led forces in Afghanistan.
A spokesman for the Afghan Taliban, Zabiullah Mujahid, denied that the meetings ever took place or that any emissaries were sent by Mullah Omar. The Afghan Taliban routinely disavow any presence in Pakistan or connection to the Pakistani Taliban to emphasize that their movement is indigenous to Afghanistan. “We don’t like to be involved with them, as we have rejected all affiliation with Pakistani Taliban fighters,” Mr. Mujahid said. “We have sympathy for them as Muslims, but beside that, there is nothing else between us.”
Several Pakistani officials, who spoke on condition of anonymity because they were not permitted to talk to news organizations, confirmed the meetings. But they said that the overture might have been inspired by Sirajuddin Haqqani, an Afghan Taliban leader who swears allegiance to Mullah Omar but is largely independent in his operations.
Mr. Haqqani, and his father Jalaluddin Haqqani, the most powerful figures in Waziristan, are closely linked to Al Qaeda and to Pakistani intelligence, American officials say. From their base in North Waziristan, they have directed groups of fighters into eastern Afghanistan and increasingly in complex attacks on the Afghan capital, Kabul.
The Taliban fighters said the Afghan Taliban delegation was led by Mullah Abdullah Zakir, a commander from Helmand Province in southern Afghanistan, whose real name is reported to be Abdullah Ghulam Rasoul.
A front-line commander during the Taliban government, Mullah Zakir was captured in 2001 in northern Afghanistan and was detained at Guantánamo Bay, Cuba, until his release in 2007, Afghan Taliban members contacted by telephone said.
The Pakistani fighters described Mullah Zakir as an impressive speaker and a trainer, and one said he was particularly energetic in working to unite the different Taliban groups. Beyond bolstering Taliban forces in Afghanistan, both the Afghan and Pakistani Taliban leaders had other reasons to unite, Pakistani officials said.
One motivation may have been to shift the focus of hostilities to Afghanistan in hopes of improving their own security in Waziristan, where more than 30 drone strikes in recent months have been directed at both Mr. Mehsud and Mr. Nazir. Two senior commanders of the Haqqani network have been killed.
The Pakistani Taliban leaders also rely on Mr. Haqqani and their affiliation with the Afghan mujahedeen for legitimacy, as well as the money and influence it brings.
In their written statement, decorated with crossed swords, the three Pakistani Taliban leaders reaffirmed their allegiance to Mullah Omar, as well as the leader of Al Qaeda, Osama bin Laden.
The mujahedeen should unite as the “enemies” have united behind the leadership of President Obama, it said. “The mujahedeen should put aside their own differences for the sake of God, God’s happiness, for the strength of religion, and to bring dishonor on the infidels.” The Taliban fighters interviewed said that the top commanders removed a number of older commanders and appointed younger commanders who were good fighters to prepare for operations in Afghanistan in the coming weeks.
In confident spirits, the Taliban fighters predicted that 2009 was going to be a “very bloody” year.
Ismail Khan contributed reporting from Peshawar, Pakistan; Pir Zubair Shah from Dera Ismail Khan, Pakistan; and Taimoor Shah from Kandahar, Afghanistan.
Suicide bomber kills 45 in Pakistan
By Pir Zubair Shah and Alan Cowell
Copyright by The International Herald Tribune
Published: March 27, 2009
http://www.iht.com/articles/2009/03/27/asia/28pstan.php
ISLAMABAD, Pakistan: At least 45 people were killed and around 70 injured when a suicide bomber detonated explosives during Friday prayers at a mosque in the Khyber region of northwest Pakistan, according to news reports from the area and residents.
Reuters quoted Tariq Hayat Khan, the chief administrator of the region close to the Afghanistan border, as telling Geo TV that "45 to 46 bodies have been retrieved. Up to 70 people could have been killed." News reports said that about 250 worshippers may have been in the mosque at the time of the attack and that the death toll could rise sharply.
Mosques across the Islamic world are especially crowded on Fridays and the apparent scale of the attack dwarfed other recent attacks in the region.
The bombing came as President Barack Obama prepared to announce his new strategy to bolster American forces in Afghanistan and for the first time set benchmarks for progress in fighting Al Qaeda and the Taliban in both Afghanistan and Pakistan.
The mosque was located in the town of Bagiari on the main highway between Afghanistan and Pakistan which is used as a principle supply route for NATO and American forces in Afghanistan. After the attack, dozens of bodies were taken to a hospital in Jamrud while relatives removed others for burial, residents said.
Many of the dead were civilians, including children, with a handful of local security forces among them, residents reported.
Television news footage from the attack showed men in long robes and white skullcaps standing atop a wall overlooking the wreckage of the mosque and carrying corpses from the debris. A minaret with a loudspeaker jutted from the rubble.
Initial reports did not indicate any claim of responsibility for the attack, which came as news emerged that Taliban leaders in Pakistan had agreed to close ranks with their Afghan counterparts to confront a planned increase of 17,000 in the number of American troops in Afghanistan.
Pir Zubair Shah reported from Islamabad, Pakistan, and Alan Cowell from Paris.
GM rethinks survival plan again
GM rethinks survival plan again
By Bernard Simon in Toronto and Daniel Schaefer in Frankfurt
Copyright The Financial Times Limited 2009
Published: March 26 2009 18:59 | Last updated: March 26 2009 18:59
http://www.ft.com/cms/s/0/15942c22-1a36-11de-9f91-0000779fd2ac.html
General Motors is to prepare a third version of the viability plan that forms the basis of US government aid to the ailing carmaker in order to take account of unrelenting weakness in the new vehicle market.
The revised plan, known as VP3, will be published early next week to coincide with the March 31 deadline for GM and its smaller Detroit rival Chrysler to prove they are meeting conditions set by the US government bail-out.
More conservative assumptions could force both carmakers into further cost-cutting measures, such as plant closures.
But people familiar with the plan said GM was not intending to ask for more aid from Washington in addition to the $13.4bn it has received and its earlier request for another $16.6bn. Chrysler has received $4bn and is asking for another $5bn. GM is also seeking help from Germany, the UK, Canada and Thailand, among others.
With the two companies still engaged in talks about concessions from lenders and the United Auto Workers union, the deadline for implementation of their turnround plans is almost certain to slip into the one-month grace period provided for by the bail-out agreements.
President Barack Obama on Thursday said the US government would advance the funds required to keep the companies afloat in the next few days, pending the outcome of the UAW and lender talks, and deliberations by the Obama administration’s auto industry task force.
“Everybody is going to have to recognise that the current economic model of the US auto industry is unsustainable,” he said.
Optimism that GM will avoid bankruptcy helped drive its shares up another 14 per cent to $3.41 on Thursday, more than double their seven-decade low this month.
But the task force, among others, has questioned assumptions of the two companies’ turnround plans.
GM’s original plan last December was based on it breaking even at US light vehicle sales of 12.5m-13m units a year. That original estimate was lowered to 11.5m-12m in February. GM also reduced its anticipated market share from 20.5 per cent to 20 per cent.
But industry sales in the first two months this year have been running at an annual rate of only 9.3m units, while GM’s market share slid to 18.3 per cent last month.
Meanwhile, tensions have risen between Opel, GM’s German subsidiary, and the Detroit parent. Some Opel managers have said they feel neglected by GM. “The US management is only occupied with the GM world and they are completely negligent of Opel,” one said.
GM Europe denied there was friction with Opel and said that it had informed management in Germany of its restructuring plans.
Opel is the core of GM’s European operations. But its restructuring is closely linked to the parent company’s own viability plan.
By Bernard Simon in Toronto and Daniel Schaefer in Frankfurt
Copyright The Financial Times Limited 2009
Published: March 26 2009 18:59 | Last updated: March 26 2009 18:59
http://www.ft.com/cms/s/0/15942c22-1a36-11de-9f91-0000779fd2ac.html
General Motors is to prepare a third version of the viability plan that forms the basis of US government aid to the ailing carmaker in order to take account of unrelenting weakness in the new vehicle market.
The revised plan, known as VP3, will be published early next week to coincide with the March 31 deadline for GM and its smaller Detroit rival Chrysler to prove they are meeting conditions set by the US government bail-out.
More conservative assumptions could force both carmakers into further cost-cutting measures, such as plant closures.
But people familiar with the plan said GM was not intending to ask for more aid from Washington in addition to the $13.4bn it has received and its earlier request for another $16.6bn. Chrysler has received $4bn and is asking for another $5bn. GM is also seeking help from Germany, the UK, Canada and Thailand, among others.
With the two companies still engaged in talks about concessions from lenders and the United Auto Workers union, the deadline for implementation of their turnround plans is almost certain to slip into the one-month grace period provided for by the bail-out agreements.
President Barack Obama on Thursday said the US government would advance the funds required to keep the companies afloat in the next few days, pending the outcome of the UAW and lender talks, and deliberations by the Obama administration’s auto industry task force.
“Everybody is going to have to recognise that the current economic model of the US auto industry is unsustainable,” he said.
Optimism that GM will avoid bankruptcy helped drive its shares up another 14 per cent to $3.41 on Thursday, more than double their seven-decade low this month.
But the task force, among others, has questioned assumptions of the two companies’ turnround plans.
GM’s original plan last December was based on it breaking even at US light vehicle sales of 12.5m-13m units a year. That original estimate was lowered to 11.5m-12m in February. GM also reduced its anticipated market share from 20.5 per cent to 20 per cent.
But industry sales in the first two months this year have been running at an annual rate of only 9.3m units, while GM’s market share slid to 18.3 per cent last month.
Meanwhile, tensions have risen between Opel, GM’s German subsidiary, and the Detroit parent. Some Opel managers have said they feel neglected by GM. “The US management is only occupied with the GM world and they are completely negligent of Opel,” one said.
GM Europe denied there was friction with Opel and said that it had informed management in Germany of its restructuring plans.
Opel is the core of GM’s European operations. But its restructuring is closely linked to the parent company’s own viability plan.
Japan prepares interception missiles
Japan prepares interception missiles
© Reuters Limited
March 27, 2009
http://www.ft.com/cms/s/0/93ee9180-1a76-11de-9f91-0000779fd2ac.html
TOKYO, March 27 – Japan on Friday ordered its military to prepare to intercept any dangerous debris that might fall on its territory if a missile launch planned by Pyongyang goes wrong.
Pyongyang has said that between April 4-8 it will launch a satellite, but regional powers believe the real purpose is to test its longest-range missile, the Taepodong-2. It has already positioned what is believed to be the missile on a launch pad.
”I have issued an order ... to prepare to destroy any object that might fall on Japan as a result of an accident involving a flying object from North Korea,” Defence Minister Yasukazu Hamada told reporters after a meeting of Japan’s Security Council.
North Korea this week put a long-range missile in place for the launch, which the United States has warned would violate UN sanctions imposed on Pyongyang for past weapons tests.
Top nuclear envoys from Japan, South Korea and the United States were to meet in Washington on Friday in a signal of growing concern over the possible launch, the first big test for US President Barack Obama in dealing with the prickly North.
Japan’s pacifist constitution does not allow it to intercept a missile if it is clearly heading elsewhere, but Tokyo would try to shoot down a missile aimed at Japanese territory and might try to intercept any debris that falls toward Japan.
Japan is expected to move ground-based Patriot Advanced Capability-3 interceptors to northern Japan, which lies under the rocket’s trajectory, and deploy two Aegis-equipped destroyers with Standard Missile-3 interceptors off Japan’s coast.
North Korea has given international agencies notice of the rocket’s planned trajectory that would take it over Japan, dropping booster stages to its east and west.
The US military has said it could with ”high probability” intercept any North Korean missile heading for US territory, if ordered to do so. Pyongyang says any attempt to shoot down the rocket would be an act of war.
Japan has interceptors theoretically capable of shooting down a missile aimed at its territory, but analysts are divided on whether it can intercept free-falling debris that may fall toward Japan.
South Korea said the launch would be a serious challenge to security in north Asia, which accounts for one sixth of the global economy. Japan urged North Korea to refrain from action that would destablise the region.
The planned launch and growing tension on the Korean peninsula are beginning to worry financial markets in the South, although so far there has been only minor impact.
”If they really fire something, it would definitely shake the financial markets, but only briefly, as has been the case in many previous cases of provocation and clashes,” said Jung Sung-min, a fixed-income analyst at Eugene Futures.
US Secretary of State Hillary Clinton, during a visit to Mexico earlier this week, said the launch would deal a blow to six-party talks to end Pyongyang’s nuclear weapons programme.
Those talks sputtered to a halt in December over disagreement on how to check the North was disabling its nuclear facilities.
North Korea warned that any action by the UN Security Council to punish it would be a ”hostile act”.
North Korea faces a range of UN sanctions and many analysts doubt new ones would get past China – the nearest Pyongyang has to a powerful ally – in the Security Council.
China, sticking to its low-key approach, said it hoped all ”relevant parties will remain restrained and calm”.
Russian Foreign Minister Sergei Lavrov also cautioned the international community against making rash decisions.
”Do not try to make evaluations before events have occurred,” he said in Moscow, while noting UN Security Council resolutions should be adhered to.
A successful launch would be a huge boost at home to leader Kim Jong-il, whose illness last year – widely thought to have been a stroke – has raised questions over his grip on power.
© Reuters Limited
March 27, 2009
http://www.ft.com/cms/s/0/93ee9180-1a76-11de-9f91-0000779fd2ac.html
TOKYO, March 27 – Japan on Friday ordered its military to prepare to intercept any dangerous debris that might fall on its territory if a missile launch planned by Pyongyang goes wrong.
Pyongyang has said that between April 4-8 it will launch a satellite, but regional powers believe the real purpose is to test its longest-range missile, the Taepodong-2. It has already positioned what is believed to be the missile on a launch pad.
”I have issued an order ... to prepare to destroy any object that might fall on Japan as a result of an accident involving a flying object from North Korea,” Defence Minister Yasukazu Hamada told reporters after a meeting of Japan’s Security Council.
North Korea this week put a long-range missile in place for the launch, which the United States has warned would violate UN sanctions imposed on Pyongyang for past weapons tests.
Top nuclear envoys from Japan, South Korea and the United States were to meet in Washington on Friday in a signal of growing concern over the possible launch, the first big test for US President Barack Obama in dealing with the prickly North.
Japan’s pacifist constitution does not allow it to intercept a missile if it is clearly heading elsewhere, but Tokyo would try to shoot down a missile aimed at Japanese territory and might try to intercept any debris that falls toward Japan.
Japan is expected to move ground-based Patriot Advanced Capability-3 interceptors to northern Japan, which lies under the rocket’s trajectory, and deploy two Aegis-equipped destroyers with Standard Missile-3 interceptors off Japan’s coast.
North Korea has given international agencies notice of the rocket’s planned trajectory that would take it over Japan, dropping booster stages to its east and west.
The US military has said it could with ”high probability” intercept any North Korean missile heading for US territory, if ordered to do so. Pyongyang says any attempt to shoot down the rocket would be an act of war.
Japan has interceptors theoretically capable of shooting down a missile aimed at its territory, but analysts are divided on whether it can intercept free-falling debris that may fall toward Japan.
South Korea said the launch would be a serious challenge to security in north Asia, which accounts for one sixth of the global economy. Japan urged North Korea to refrain from action that would destablise the region.
The planned launch and growing tension on the Korean peninsula are beginning to worry financial markets in the South, although so far there has been only minor impact.
”If they really fire something, it would definitely shake the financial markets, but only briefly, as has been the case in many previous cases of provocation and clashes,” said Jung Sung-min, a fixed-income analyst at Eugene Futures.
US Secretary of State Hillary Clinton, during a visit to Mexico earlier this week, said the launch would deal a blow to six-party talks to end Pyongyang’s nuclear weapons programme.
Those talks sputtered to a halt in December over disagreement on how to check the North was disabling its nuclear facilities.
North Korea warned that any action by the UN Security Council to punish it would be a ”hostile act”.
North Korea faces a range of UN sanctions and many analysts doubt new ones would get past China – the nearest Pyongyang has to a powerful ally – in the Security Council.
China, sticking to its low-key approach, said it hoped all ”relevant parties will remain restrained and calm”.
Russian Foreign Minister Sergei Lavrov also cautioned the international community against making rash decisions.
”Do not try to make evaluations before events have occurred,” he said in Moscow, while noting UN Security Council resolutions should be adhered to.
A successful launch would be a huge boost at home to leader Kim Jong-il, whose illness last year – widely thought to have been a stroke – has raised questions over his grip on power.
Lancet lashes out at Pope over condoms
Lancet lashes out at Pope over condoms
By John O’Doherty
Copyright The Financial Times Limited 2009
Published: March 27 2009 09:28 | Last updated: March 27 2009 10:01
http://www.ft.com/cms/s/0/02826b9e-1aa9-11de-8aa3-0000779fd2ac.html
The Lancet has launched a stinging attack on the Pope for his opposition to the use of condoms, branding as “outrageous and wildly inaccurate” his argument that the prophylactics serve to increase HIV infection.
“By saying that condoms exacerbate the problem of HIV/AIDS, the Pope has publicly distorted scientific evidence to promote Catholic doctrine on this issue,” the journal said in an editorial released on Friday.
While the Vatican has long been opposed to the use of artificial contraception, Pope Benedict hardened his stance during his first visit to Africa, made last week, when he said that condom use actually increased the likelihood of HIV infection and the spread of AIDS.
“The problem [of AIDS] cannot be overcome by the distribution of prophylactics: on the contrary, they increase it,” he said to a French journalist, while on a flight to Cameroon.
The controversy forced the Vatican to subsequently try and finesse the pope’s comments, insisting he had been misunderstood.
“Whether the Pope’s error was due to ignorance or a deliberate attempt to manipulate science to support Catholic ideology is unclear,” the Lancet editorial continued.
“But the comment still stands and the Vatican’s attempts to tweak the Pope’s words, further tampering with the truth, is not the way forward. When any influential person, be it a religious or political leader, makes a false scientific statement that could be devastating to the health of millions of people, they should retract or correct the public record.”
The Pope’s comments on HIV have been seized upon by critics as another example of his detachment from the sensibilities of the modern world, following the furore last month over his decision to lift the excommunication of four ultra-traditionalist clerics. The men were followers of Marcel Lefebvre, a French archbishop who opposed the reforms of the Second Vatican Council. One of those rehabilitated was a British bishop who questioned the existence of German gas chambers in the second world war.
Benedict also aroused the ire of critics in 2006, when at a speech in Regensburg, Germany he quoted from a 14th century Byzantine emperor who described Islam as “evil and inhuman”.
By John O’Doherty
Copyright The Financial Times Limited 2009
Published: March 27 2009 09:28 | Last updated: March 27 2009 10:01
http://www.ft.com/cms/s/0/02826b9e-1aa9-11de-8aa3-0000779fd2ac.html
The Lancet has launched a stinging attack on the Pope for his opposition to the use of condoms, branding as “outrageous and wildly inaccurate” his argument that the prophylactics serve to increase HIV infection.
“By saying that condoms exacerbate the problem of HIV/AIDS, the Pope has publicly distorted scientific evidence to promote Catholic doctrine on this issue,” the journal said in an editorial released on Friday.
While the Vatican has long been opposed to the use of artificial contraception, Pope Benedict hardened his stance during his first visit to Africa, made last week, when he said that condom use actually increased the likelihood of HIV infection and the spread of AIDS.
“The problem [of AIDS] cannot be overcome by the distribution of prophylactics: on the contrary, they increase it,” he said to a French journalist, while on a flight to Cameroon.
The controversy forced the Vatican to subsequently try and finesse the pope’s comments, insisting he had been misunderstood.
“Whether the Pope’s error was due to ignorance or a deliberate attempt to manipulate science to support Catholic ideology is unclear,” the Lancet editorial continued.
“But the comment still stands and the Vatican’s attempts to tweak the Pope’s words, further tampering with the truth, is not the way forward. When any influential person, be it a religious or political leader, makes a false scientific statement that could be devastating to the health of millions of people, they should retract or correct the public record.”
The Pope’s comments on HIV have been seized upon by critics as another example of his detachment from the sensibilities of the modern world, following the furore last month over his decision to lift the excommunication of four ultra-traditionalist clerics. The men were followers of Marcel Lefebvre, a French archbishop who opposed the reforms of the Second Vatican Council. One of those rehabilitated was a British bishop who questioned the existence of German gas chambers in the second world war.
Benedict also aroused the ire of critics in 2006, when at a speech in Regensburg, Germany he quoted from a 14th century Byzantine emperor who described Islam as “evil and inhuman”.
Obama set to boost Afghanistan force
Obama set to boost Afghanistan force
By Demetri Sevastopulo in Washington
Copyright The Financial Times Limited 2009
Published: March 26 2009 23:49 | Last updated: March 26 2009 23:49
http://www.ft.com/cms/s/0/f11061ee-1a5e-11de-9f91-0000779fd2ac.html
Barack Obama will on Friday announce a new strategy for Afghanistan that will include sending another 4,000 troops and hundreds of new civilian officials to the war-torn country.
The president’s strategy is expected to shift the focus of operations in Afghanistan to ensuring that al-Qaeda cannot attack the US, which represents a ratcheting down of the ambitious goals of George W. Bush, the former US president, who pledged to instill democracy in Afghanistan.
US military and state department officials briefed Congress on Friday on the strategy which is the product of several months of review.
Earlier, Dennis Blair, the new director of national intelligence, said the US needed to improve its intelligence on Afghanistan to gain a better understanding of the country regardless of whatever strategy Mr Obama chose.
“We know a heck of a lot more about Iraq on a very granular basis than we know about Afghanistan,” said Mr Blair.
“We need to ramp up the level of intelligence support in Afghanistan and that would be a lot more than just making sure the villages were on the maps. It would be a granular understanding of local power structures, individuals . . . ”
Mr Obama is on Friday expected to detail the new direction for policy in Afghanistan, which will place a greater focus on dealing with al-Qaeda and Taliban militants operating from havens inside Pakistan.
The Pentagon is also examining whether the US and Afghanistan can peel local Taliban away from the hard-core extremists linked to Mullah Omar, the Taliban leader who fled Afghanistan after the 2001 invasion.
“There are Taliban and Taliban,” said Mr Blair. “Some of them have local issues . . . some of them have pretty hard core aggressive ideas which are unlikely to be ever compatible with American interests.”
Mr Blair said that about two-thirds of the Taliban were locally focused militants who “can be defeated if the government with international assistance can provide them the basics of a good life and that particularly valley or district”.
He said: “Mullah Omar is certainly a tough case. He thinks he ought to be running Afghanistan and doesn’t show many signs of settling for anything less.”
Some US officials have pushed for an effort to reach out to Mullah Omar, but other officials believe that he falls into the category of hardcore militants where accommodation could not be reached.
Hamid Karzai, the president of Afghanistan, last week said that Mr Omar must “speak for peace, accept the Afghan constitution, denounce violence and say that he’s not enemies with the rest of the world, that he wants to co-exist with the rest of the world” before the Afghan government would reconcile with him.
However, Mr Karzai suggested that Washington needed to reach out to Mr Omar, telling PBS television that “it has to be a two-way thing”.
“One is the announcement by President Obama; the next is the responsibility that falls on the Taliban leaders to take this opportunity.”
By Demetri Sevastopulo in Washington
Copyright The Financial Times Limited 2009
Published: March 26 2009 23:49 | Last updated: March 26 2009 23:49
http://www.ft.com/cms/s/0/f11061ee-1a5e-11de-9f91-0000779fd2ac.html
Barack Obama will on Friday announce a new strategy for Afghanistan that will include sending another 4,000 troops and hundreds of new civilian officials to the war-torn country.
The president’s strategy is expected to shift the focus of operations in Afghanistan to ensuring that al-Qaeda cannot attack the US, which represents a ratcheting down of the ambitious goals of George W. Bush, the former US president, who pledged to instill democracy in Afghanistan.
US military and state department officials briefed Congress on Friday on the strategy which is the product of several months of review.
Earlier, Dennis Blair, the new director of national intelligence, said the US needed to improve its intelligence on Afghanistan to gain a better understanding of the country regardless of whatever strategy Mr Obama chose.
“We know a heck of a lot more about Iraq on a very granular basis than we know about Afghanistan,” said Mr Blair.
“We need to ramp up the level of intelligence support in Afghanistan and that would be a lot more than just making sure the villages were on the maps. It would be a granular understanding of local power structures, individuals . . . ”
Mr Obama is on Friday expected to detail the new direction for policy in Afghanistan, which will place a greater focus on dealing with al-Qaeda and Taliban militants operating from havens inside Pakistan.
The Pentagon is also examining whether the US and Afghanistan can peel local Taliban away from the hard-core extremists linked to Mullah Omar, the Taliban leader who fled Afghanistan after the 2001 invasion.
“There are Taliban and Taliban,” said Mr Blair. “Some of them have local issues . . . some of them have pretty hard core aggressive ideas which are unlikely to be ever compatible with American interests.”
Mr Blair said that about two-thirds of the Taliban were locally focused militants who “can be defeated if the government with international assistance can provide them the basics of a good life and that particularly valley or district”.
He said: “Mullah Omar is certainly a tough case. He thinks he ought to be running Afghanistan and doesn’t show many signs of settling for anything less.”
Some US officials have pushed for an effort to reach out to Mullah Omar, but other officials believe that he falls into the category of hardcore militants where accommodation could not be reached.
Hamid Karzai, the president of Afghanistan, last week said that Mr Omar must “speak for peace, accept the Afghan constitution, denounce violence and say that he’s not enemies with the rest of the world, that he wants to co-exist with the rest of the world” before the Afghan government would reconcile with him.
However, Mr Karzai suggested that Washington needed to reach out to Mr Omar, telling PBS television that “it has to be a two-way thing”.
“One is the announcement by President Obama; the next is the responsibility that falls on the Taliban leaders to take this opportunity.”
Shoddy wiring 'everywhere' on Iraq bases, Army inspector says
Shoddy wiring 'everywhere' on Iraq bases, Army inspector says
From Abbie Boudreau and Scott Bronstein
Copyright by CNN News
updated 8:57 p.m. EDT, Thu March 26, 2009
http://www.cnn.com/2009/WORLD/meast/03/26/military.electrocutions/index.html
WASHINGTON (CNN) -- Thousands of buildings at U.S. bases in Iraq and Afghanistan have such poorly installed wiring that American troops face life-threatening risks, a top inspector for the Army says.
These wires installed in Iraq are some of the most important to ensure safety. They all need to be replaced.
These wires installed in Iraq are some of the most important to ensure safety. They all need to be replaced.
"It was horrible -- some of the worst electrical work I've ever seen," said Jim Childs, a master electrician and the top civilian expert in an Army safety survey. Childs told CNN that "with the buildings the way they are, we're playing Russian roulette."
Childs recently returned from Iraq, where he is taking part in a yearlong review aimed at correcting electrical hazards on U.S. bases. He told CNN that thousands of buildings in Iraq and Afghanistan are so badly wired that troops are at serious risk of death or injury.
He said problems are "everywhere" in Iraq, where 18 U.S. troops have died by electrocution since 2003. All deaths occurred in different circumstances and different locations, but many happened on U.S. bases being managed by various military contractors. The Army has has reopened investigations in at least five cases, according to Pentagon sources.
Of the nearly 30,000 buildings the Army's "Task Force Safe" has examined so far, Childs said more than half "failed miserably." And 8,527 had such serious problems that inspectors gave them a "flash" warning, meaning repairs had to be completed in four hours or the facility evacuated.
He said the majority of those buildings were wired by contractor KBR, based in Houston, Texas. KBR has faced extensive criticism from Congress over its performance in the war zone. KBR has defended its performance and argued it was not to blame for any fatalities.
Military electrocutions became a national issue about a year ago, after the January 2008 death of Staff Sgt. Ryan Maseth of Pittsburgh, Pennsylvania. A decorated member of the Army's Green Berets, Maseth was electrocuted in his shower at a U.S. base in Baghdad that once served as one of Saddam Hussein's palaces.
His death was blamed on improper grounding and dangerous wiring on his living quarters. Soon after that, the Army asked Childs to help create "Task Force Safe," a team of master electricians assigned to inspect Army posts for electrical dangers.
Childs said the "large majority" of the buildings the task force examined in Iraq had been wired by KBR, which he expected would follow American standards. But the results, he said, were "just horrible."
In one building, "I had them pull a switch out of the wall to look at a switch, and when they pulled it out of the wall, the wires fell out of it," Childs said. Thinking that was an exception, "We pulled the one next to it. They fell off," he said. "It was just very, very poor quality work."
Much of the work was done by crews from countries beyond Iraq, "with very little supervision by anybody." And many of the problems involved improperly grounded systems that allowed plumbing to conduct electricity, which he said could lead to electric shocks such as the one that killed Maseth.
Childs said service orders on at least two occasions warned of the hazard in Maseth's quarters, and "two simple electrical 101s" should have been checked out by electricians.
"A competent electrical contractor and electrician would have gone to that job site and tried to discover why pipes could have been energized," he said. If they had been, "then Ryan Maseth would not have been electrocuted, in my opinion."
Maseth's family is suing KBR. An Army investigator has recommended that his cause of death be changed to "negligent homicide," accusing the company of failing to properly supervise or inspect its work. The Army has yet to accept the recommendation.
KBR has repeatedly said it was not responsible for Maseth's death or for any of the others and defended its work.
"KBR has worked diligently to address electrical issues when asked," the company told CNN in a written statement. "What is important to remember is the challenging environment in which these issues exist.
"The electrical standards in Iraq are nowhere near those of Western or U.S. standards. Add to this the challenges that exist in a war zone. We have been and remain committed to fully cooperating with the government on this issue."
But Childs said the majority of buildings on U.S. bases were built and wired by KBR since the U.S. invasion.
"They installed the housing units, they installed the electrical, they installed the wiring. They installed it all. And it's wrong," he said. "It's all put in wrong."
KBR was not alone, however. He said the Army survey found problems with every contractor whose work it inspected.
Task Force Safe has yet to inspect another 70,000 buildings in Iraq and has just begun its review of bases in Afghanistan, where contractors have raised similar concerns. In written answers to questions from CNN, Pentagon spokesman Chris Isleib said, "We are correcting hazardous conditions every day."
"This is a huge undertaking but absolutely necessary for the life, health and safety of our service members and civilians," he said. "When we find a defect, we put in an emergency work order and take action immediately to protect the people working or living in those facilities."
But Childs told CNN he is surprised more Americans have not been hurt.
"All the potentials are there," he said. "It just hasn't happened."
From Abbie Boudreau and Scott Bronstein
Copyright by CNN News
updated 8:57 p.m. EDT, Thu March 26, 2009
http://www.cnn.com/2009/WORLD/meast/03/26/military.electrocutions/index.html
WASHINGTON (CNN) -- Thousands of buildings at U.S. bases in Iraq and Afghanistan have such poorly installed wiring that American troops face life-threatening risks, a top inspector for the Army says.
These wires installed in Iraq are some of the most important to ensure safety. They all need to be replaced.
These wires installed in Iraq are some of the most important to ensure safety. They all need to be replaced.
"It was horrible -- some of the worst electrical work I've ever seen," said Jim Childs, a master electrician and the top civilian expert in an Army safety survey. Childs told CNN that "with the buildings the way they are, we're playing Russian roulette."
Childs recently returned from Iraq, where he is taking part in a yearlong review aimed at correcting electrical hazards on U.S. bases. He told CNN that thousands of buildings in Iraq and Afghanistan are so badly wired that troops are at serious risk of death or injury.
He said problems are "everywhere" in Iraq, where 18 U.S. troops have died by electrocution since 2003. All deaths occurred in different circumstances and different locations, but many happened on U.S. bases being managed by various military contractors. The Army has has reopened investigations in at least five cases, according to Pentagon sources.
Of the nearly 30,000 buildings the Army's "Task Force Safe" has examined so far, Childs said more than half "failed miserably." And 8,527 had such serious problems that inspectors gave them a "flash" warning, meaning repairs had to be completed in four hours or the facility evacuated.
He said the majority of those buildings were wired by contractor KBR, based in Houston, Texas. KBR has faced extensive criticism from Congress over its performance in the war zone. KBR has defended its performance and argued it was not to blame for any fatalities.
Military electrocutions became a national issue about a year ago, after the January 2008 death of Staff Sgt. Ryan Maseth of Pittsburgh, Pennsylvania. A decorated member of the Army's Green Berets, Maseth was electrocuted in his shower at a U.S. base in Baghdad that once served as one of Saddam Hussein's palaces.
His death was blamed on improper grounding and dangerous wiring on his living quarters. Soon after that, the Army asked Childs to help create "Task Force Safe," a team of master electricians assigned to inspect Army posts for electrical dangers.
Childs said the "large majority" of the buildings the task force examined in Iraq had been wired by KBR, which he expected would follow American standards. But the results, he said, were "just horrible."
In one building, "I had them pull a switch out of the wall to look at a switch, and when they pulled it out of the wall, the wires fell out of it," Childs said. Thinking that was an exception, "We pulled the one next to it. They fell off," he said. "It was just very, very poor quality work."
Much of the work was done by crews from countries beyond Iraq, "with very little supervision by anybody." And many of the problems involved improperly grounded systems that allowed plumbing to conduct electricity, which he said could lead to electric shocks such as the one that killed Maseth.
Childs said service orders on at least two occasions warned of the hazard in Maseth's quarters, and "two simple electrical 101s" should have been checked out by electricians.
"A competent electrical contractor and electrician would have gone to that job site and tried to discover why pipes could have been energized," he said. If they had been, "then Ryan Maseth would not have been electrocuted, in my opinion."
Maseth's family is suing KBR. An Army investigator has recommended that his cause of death be changed to "negligent homicide," accusing the company of failing to properly supervise or inspect its work. The Army has yet to accept the recommendation.
KBR has repeatedly said it was not responsible for Maseth's death or for any of the others and defended its work.
"KBR has worked diligently to address electrical issues when asked," the company told CNN in a written statement. "What is important to remember is the challenging environment in which these issues exist.
"The electrical standards in Iraq are nowhere near those of Western or U.S. standards. Add to this the challenges that exist in a war zone. We have been and remain committed to fully cooperating with the government on this issue."
But Childs said the majority of buildings on U.S. bases were built and wired by KBR since the U.S. invasion.
"They installed the housing units, they installed the electrical, they installed the wiring. They installed it all. And it's wrong," he said. "It's all put in wrong."
KBR was not alone, however. He said the Army survey found problems with every contractor whose work it inspected.
Task Force Safe has yet to inspect another 70,000 buildings in Iraq and has just begun its review of bases in Afghanistan, where contractors have raised similar concerns. In written answers to questions from CNN, Pentagon spokesman Chris Isleib said, "We are correcting hazardous conditions every day."
"This is a huge undertaking but absolutely necessary for the life, health and safety of our service members and civilians," he said. "When we find a defect, we put in an emergency work order and take action immediately to protect the people working or living in those facilities."
But Childs told CNN he is surprised more Americans have not been hurt.
"All the potentials are there," he said. "It just hasn't happened."
Thursday, March 26, 2009
Chicago Parking Meter Revolt...
Chicago Parking Meter Revolt...
As you all know, the City of Chicago has given our parking meters
away to a private company on a 75 year lease. This company
has decided to quadruple rates, which will now apply 24/7/365.
There has been a rumor going around that many Chicagoans
are now feeding meters with coins wrapped in chewing gum,
as well as utilizing a myriad of other such stunts. This causes
the meters to be disabled.
Remember, if you park at a meter which happens to be disabled
you can still get a parking ticket, unless, within 24 hours, you
report that meter to be out of order. To report a meter out of
order: “Report the broken or malfunctioning meter by
calling 1-877-242-7901, or by filling out our Feedback form….”
Also see
http://vodpod.com/watch/1466261-chicagoans-vandalize-parking-meters-video
Another rumor going around now claims that the motto of Chicago
has changed, from “The City That Works” to “Never Pass On An
Opportunity To Vandalize A Parking Meter.”
Obviously, I am not vouching for the truth of these rumors,
nor endorsing such behaviors…
As you all know, the City of Chicago has given our parking meters
away to a private company on a 75 year lease. This company
has decided to quadruple rates, which will now apply 24/7/365.
There has been a rumor going around that many Chicagoans
are now feeding meters with coins wrapped in chewing gum,
as well as utilizing a myriad of other such stunts. This causes
the meters to be disabled.
Remember, if you park at a meter which happens to be disabled
you can still get a parking ticket, unless, within 24 hours, you
report that meter to be out of order. To report a meter out of
order: “Report the broken or malfunctioning meter by
calling 1-877-242-7901, or by filling out our Feedback
Also see
http://vodpod.com/watch/1466261-chicagoans-vandalize-parking-meters-video
Another rumor going around now claims that the motto of Chicago
has changed, from “The City That Works” to “Never Pass On An
Opportunity To Vandalize A Parking Meter.”
Obviously, I am not vouching for the truth of these rumors,
nor endorsing such behaviors…
Obama answers seven of 90,000 Web questions
Obama answers seven of 90,000 Web questions
By John D. Sutter
Copyright by CNN News
http://www.cnn.com/2009/TECH/03/26/online.obama/index.html
See the video: http://www.whitehouse.gov/openforquestions/?elr=KArks8c7PaP3E77K_3c::D3aDhUec7PaP3E77K_0c::D3aDhUiacyKUUr
(CNN) -- In an appeal to the tech-savvy public, the White House's Web site opened itself to questions for President Obama's online town hall meeting Thursday.
Obama began taking your questions in an online town hall meeting at 11:30 a.m. ET.
The virtual meeting, a new take on President Franklin Roosevelt's fireside chats, was another sign that Obama is reaching out to online followers as he tries to rally an anxious country in support of his solutions to the economic crisis.
Obama began his address by trying to draw a clear line between what he sees as the political games of Washington and the actual needs of the American people.
"What matters to you and your families and what people here in Washington are focused on are not always" the same, he said, criticizing the winner-loser mindset of the politicians in the nation's capitol.
"This isn't about me, it's about you," he said. "It's about the families whose letters I read every single day, and, for the American people, what's going on is not a game."
After the call for questions closed at 9:30 a.m., more than 90,000 people had submitted more than 104,000 questions for the president. The questions largely focused on the economy but spread across several categories. Online users ranked the questions more than 3.6 million times, according to WhiteHouse.gov.
Obama had promised to answer popular questions from the site.
The idea that a president would want to talk directly to the American people has been around since the days of FDR, but what was new about Obama's online town hall is that it encouraged members of the public to interact with each other, said Julie Moos, director of Poynter Online, a nonprofit journalism site.
Don't Miss
Questions pour in for Obama's online town hall
Obama goes to Capitol to lobby Democrats on budget
"By allowing [Internet users] not just to submit questions but to see the other questions ... and to rank the questions continues to connect them in the same way that the [Obama] campaign did," Moos said. "And I think that's one of the most innovative things that they're doing."
Flanked by a flat-screen TV and backed by a 100-person audience in the White House's East Room, the president answered text questions and those submitted in video format. Read a CNN blog on the event
Obama answered seven of the most popular online questions, according to a CNN tally. That included a paraphrase of a question asked by several people online: would legalizing marijuana help jumpstart the economy.
The president grinned through his answer: "I don't' know what this says about the online audience," he said, adding: "The answer is, 'No,' I don't think that is a good strategy to grow our economy." iReport.com: Is it time to legalize marijuana?
Other questions -- some of which came from the live audience -- focused primarily on health care, job loss, mortgage payments and energy.
A video question from three bubbly college students was well received by the audience. In it, the young women asked how Obama will make college more affordable and when a national program may start.
Obama said too many college students finish school while drowning in debt. He said a public service program will begin in a matter of weeks.
"If you come out of college with $50,000 worth of debt it's then hard for you to start making a decision about wanting to be a teacher or wanting to go into social work," he said.
In one video question, a woman asked the president if manufacturing jobs that have gone overseas will come back.
No, Obama answered.
America needs to create new jobs "that can't be outsourced," he said. Many of those will be in the renewable energy sector, he said.
During the address, the online community commented on Obama's answers and the format of the town hall. Users could watch streaming video of the question-answer session online at WhiteHouse.gov as well as on CNN.com.
On the social media site Twitter, a user named kfoggy1 wrote: "[I] didn't vote for Obama, but I really like what he is doing with technology. Good for democracy."
A user called BeaconOfLight was less impressed.
"Another chance for Obama to get TV time. Get your glass the 'kool aid' will flow," the user wrote.
A quick survey of the more than 90,000 questions submitted at WhiteHouse.gov revealed an America troubled by the state of the economy and struggling to make ends meet.
The White House asked the public to submit questions only about the economy, but the site divided them into several subcategories.
In education, several popular questions came from people who criticized the state of the nation's educational system, or were having trouble paying off college debt.
"The Founding Fathers believed that there is no difference between a free society and an educated society. Our educational system, however, is woefully inadequate. How do you plan to restore education as a right and core cultural value in America?" asked Takeok, from Boston, Massachusetts.
In the "home ownership" category, several users wrote that they feel they've been making all the right financial moves and still find themselves in turmoil.
"Why aren't you helping the people who want to PREVENT foreclosure?" asked MistyLee, from Providence, Rhode Island.
Some health care submissions questioned why more Americans aren't covered.
Richard from California asked why this nation can't have universal health care like countries in Europe, "where people are treated based on needs, rather than financial resources."
Questions filed under green jobs and energy prodded the president to reconsider ethanol subsidies and asked him to explain how the stimulus plan will affect green jobs and home weatherization.
Larkin, a user from Gaithersburg, Maryland, was one of several people to raise the issue of public transit.
"Will we ever see high-speed passenger rail service in the U.S.?" the user asked.
In the finance category, Web users wanted to know more about why the government couldn't break up large financial institutions into smaller entities.
Adrian, of Collinsville, Illinois, worried about businesses that have survived the economic collapse.
"What rewards are there for those people and businesses that chose to live and operate within their means?" the user asked.
The site began taking questions on Tuesday and stopped on Thursday at 9:30 a.m. ET. The Web service was hosted by Google, but the White House said it will protect user information in accordance with its own privacy guidelines.
Questions asked on the site were made public immediately, the White House said. Users could flag questions they deemed inappropriate.
Moos, of Poynter, said one of the biggest take-aways from the event is that it connected these audiences to the president and a sense that they're part of a valued online community -- an engaged citizenry.
By John D. Sutter
Copyright by CNN News
http://www.cnn.com/2009/TECH/03/26/online.obama/index.html
See the video: http://www.whitehouse.gov/openforquestions/?elr=KArks8c7PaP3E77K_3c::D3aDhUec7PaP3E77K_0c::D3aDhUiacyKUUr
(CNN) -- In an appeal to the tech-savvy public, the White House's Web site opened itself to questions for President Obama's online town hall meeting Thursday.
Obama began taking your questions in an online town hall meeting at 11:30 a.m. ET.
The virtual meeting, a new take on President Franklin Roosevelt's fireside chats, was another sign that Obama is reaching out to online followers as he tries to rally an anxious country in support of his solutions to the economic crisis.
Obama began his address by trying to draw a clear line between what he sees as the political games of Washington and the actual needs of the American people.
"What matters to you and your families and what people here in Washington are focused on are not always" the same, he said, criticizing the winner-loser mindset of the politicians in the nation's capitol.
"This isn't about me, it's about you," he said. "It's about the families whose letters I read every single day, and, for the American people, what's going on is not a game."
After the call for questions closed at 9:30 a.m., more than 90,000 people had submitted more than 104,000 questions for the president. The questions largely focused on the economy but spread across several categories. Online users ranked the questions more than 3.6 million times, according to WhiteHouse.gov.
Obama had promised to answer popular questions from the site.
The idea that a president would want to talk directly to the American people has been around since the days of FDR, but what was new about Obama's online town hall is that it encouraged members of the public to interact with each other, said Julie Moos, director of Poynter Online, a nonprofit journalism site.
Don't Miss
Questions pour in for Obama's online town hall
Obama goes to Capitol to lobby Democrats on budget
"By allowing [Internet users] not just to submit questions but to see the other questions ... and to rank the questions continues to connect them in the same way that the [Obama] campaign did," Moos said. "And I think that's one of the most innovative things that they're doing."
Flanked by a flat-screen TV and backed by a 100-person audience in the White House's East Room, the president answered text questions and those submitted in video format. Read a CNN blog on the event
Obama answered seven of the most popular online questions, according to a CNN tally. That included a paraphrase of a question asked by several people online: would legalizing marijuana help jumpstart the economy.
The president grinned through his answer: "I don't' know what this says about the online audience," he said, adding: "The answer is, 'No,' I don't think that is a good strategy to grow our economy." iReport.com: Is it time to legalize marijuana?
Other questions -- some of which came from the live audience -- focused primarily on health care, job loss, mortgage payments and energy.
A video question from three bubbly college students was well received by the audience. In it, the young women asked how Obama will make college more affordable and when a national program may start.
Obama said too many college students finish school while drowning in debt. He said a public service program will begin in a matter of weeks.
"If you come out of college with $50,000 worth of debt it's then hard for you to start making a decision about wanting to be a teacher or wanting to go into social work," he said.
In one video question, a woman asked the president if manufacturing jobs that have gone overseas will come back.
No, Obama answered.
America needs to create new jobs "that can't be outsourced," he said. Many of those will be in the renewable energy sector, he said.
During the address, the online community commented on Obama's answers and the format of the town hall. Users could watch streaming video of the question-answer session online at WhiteHouse.gov as well as on CNN.com.
On the social media site Twitter, a user named kfoggy1 wrote: "[I] didn't vote for Obama, but I really like what he is doing with technology. Good for democracy."
A user called BeaconOfLight was less impressed.
"Another chance for Obama to get TV time. Get your glass the 'kool aid' will flow," the user wrote.
A quick survey of the more than 90,000 questions submitted at WhiteHouse.gov revealed an America troubled by the state of the economy and struggling to make ends meet.
The White House asked the public to submit questions only about the economy, but the site divided them into several subcategories.
In education, several popular questions came from people who criticized the state of the nation's educational system, or were having trouble paying off college debt.
"The Founding Fathers believed that there is no difference between a free society and an educated society. Our educational system, however, is woefully inadequate. How do you plan to restore education as a right and core cultural value in America?" asked Takeok, from Boston, Massachusetts.
In the "home ownership" category, several users wrote that they feel they've been making all the right financial moves and still find themselves in turmoil.
"Why aren't you helping the people who want to PREVENT foreclosure?" asked MistyLee, from Providence, Rhode Island.
Some health care submissions questioned why more Americans aren't covered.
Richard from California asked why this nation can't have universal health care like countries in Europe, "where people are treated based on needs, rather than financial resources."
Questions filed under green jobs and energy prodded the president to reconsider ethanol subsidies and asked him to explain how the stimulus plan will affect green jobs and home weatherization.
Larkin, a user from Gaithersburg, Maryland, was one of several people to raise the issue of public transit.
"Will we ever see high-speed passenger rail service in the U.S.?" the user asked.
In the finance category, Web users wanted to know more about why the government couldn't break up large financial institutions into smaller entities.
Adrian, of Collinsville, Illinois, worried about businesses that have survived the economic collapse.
"What rewards are there for those people and businesses that chose to live and operate within their means?" the user asked.
The site began taking questions on Tuesday and stopped on Thursday at 9:30 a.m. ET. The Web service was hosted by Google, but the White House said it will protect user information in accordance with its own privacy guidelines.
Questions asked on the site were made public immediately, the White House said. Users could flag questions they deemed inappropriate.
Moos, of Poynter, said one of the biggest take-aways from the event is that it connected these audiences to the president and a sense that they're part of a valued online community -- an engaged citizenry.
D.C. AIDS activist joins TPAN/TPAN names new director
D.C. AIDS activist joins TPAN
By Amy Wooten
Copyright by The Chicago Free Press
March 25, 2009
http://www.chicagofreepress.com/node/3298
Test Positive Aware Network (TPAN) last week announced its new executive director, Bruce Weiss.
Weiss worked as a leader of the Washington, D.C., HIV/AIDS community for over a decade. His previous work includes serving as the executive director of the Sexual Minority Youth Action League, and more recently, as the director of community health at D.C.’s Whitman-Walker Clinic. Weiss also received the 2006 Capital Pride Hero Award.
Weiss said that he was “really thrilled” when he saw that TPAN, an agency he was known about for years, was looking for a new executive director, and added that he had been inspired by the organization’s approach to HIV/AIDS services.
“I feel very honored to have been chosen to join the team,” he added.
Bill Farrand, who served as the interim executive director, will serve as the agency’s director of client services once Weiss starts on April 13.
TPAN names new director
Copyright by The Windy City Times
2009-03-25
http://www.windycitymediagroup.com/gay/lesbian/news/ARTICLE.php?AID=20748
HIV/AIDS agency Test Positive Aware Network ( TPAN ) has announced that Bruce Weiss is the organization's executive director.
“Bruce is that rare combination of experienced leadership and unbridled enthusiasm,” said TPAN board president Condon McGlothlen. “Everyone at TPAN is excited about his arrival.”
A recipient of the 2006 Capital Pride Hero Award honoring LGBT leaders, Weiss has provided leadership to the HIV/AIDS community in Washington, D.C., for more than a decade. He served for several years as the executive director of the Sexual Minority Youth Action League ) , overseeing major growth in their programs, staffing and funding. He later became the director of the Whitman-Walker Clinic of Northern Virginia, a community health clinic focused on HIV and LGBT health care.
“I feel very fortunate to be joining such a vibrant organization,” said Weiss. “Chicago is a great city and the TPAN staff, board of directors and volunteers inspired me with their energy and passion the moment I walked through the front door. It is a remarkable organization providing important HIV prevention and care services.”
Bill Farrand, who has served as TPAN's interim executive director since October 2008, will continue in his role as the agency's director of client services.
More than 100 Chicago Public Schools ( CPS ) alumni have achieved renown as journalists, publishers and media personalities in the history of the school district. CPS issued a press release announcing the top 100 list; Windy City Times co-founder and publisher, Tracy Baim, is on said list.
The list of media personalities, found on the CPS alumni Web site, www.CPSalumni.org , also includes the late Studs Terkel, Saul Bellow, Nelson Algren, Ethel Payne, Jerome Holtzman and Mike Royko. There are seven Pulitzer Prize winners, seven Peabody Award winners, two National Book Award winners, two members of the Baseball Hall of Fame Writer's Wing and 18 Emmy Award winners listed.
Several CPS alums now have awards named for them, including the late John Chancellor, Peter Lisagor and Herb Block, a three-time Pulitzer Prize-winning editorial cartoonist.
Baim attended Grenneman, Newberry and Walt Disney grammar schools, and is a 1980 graduate of Lane Technical High School.
By Amy Wooten
Copyright by The Chicago Free Press
March 25, 2009
http://www.chicagofreepress.com/node/3298
Test Positive Aware Network (TPAN) last week announced its new executive director, Bruce Weiss.
Weiss worked as a leader of the Washington, D.C., HIV/AIDS community for over a decade. His previous work includes serving as the executive director of the Sexual Minority Youth Action League, and more recently, as the director of community health at D.C.’s Whitman-Walker Clinic. Weiss also received the 2006 Capital Pride Hero Award.
Weiss said that he was “really thrilled” when he saw that TPAN, an agency he was known about for years, was looking for a new executive director, and added that he had been inspired by the organization’s approach to HIV/AIDS services.
“I feel very honored to have been chosen to join the team,” he added.
Bill Farrand, who served as the interim executive director, will serve as the agency’s director of client services once Weiss starts on April 13.
TPAN names new director
Copyright by The Windy City Times
2009-03-25
http://www.windycitymediagroup.com/gay/lesbian/news/ARTICLE.php?AID=20748
HIV/AIDS agency Test Positive Aware Network ( TPAN ) has announced that Bruce Weiss is the organization's executive director.
“Bruce is that rare combination of experienced leadership and unbridled enthusiasm,” said TPAN board president Condon McGlothlen. “Everyone at TPAN is excited about his arrival.”
A recipient of the 2006 Capital Pride Hero Award honoring LGBT leaders, Weiss has provided leadership to the HIV/AIDS community in Washington, D.C., for more than a decade. He served for several years as the executive director of the Sexual Minority Youth Action League ) , overseeing major growth in their programs, staffing and funding. He later became the director of the Whitman-Walker Clinic of Northern Virginia, a community health clinic focused on HIV and LGBT health care.
“I feel very fortunate to be joining such a vibrant organization,” said Weiss. “Chicago is a great city and the TPAN staff, board of directors and volunteers inspired me with their energy and passion the moment I walked through the front door. It is a remarkable organization providing important HIV prevention and care services.”
Bill Farrand, who has served as TPAN's interim executive director since October 2008, will continue in his role as the agency's director of client services.
More than 100 Chicago Public Schools ( CPS ) alumni have achieved renown as journalists, publishers and media personalities in the history of the school district. CPS issued a press release announcing the top 100 list; Windy City Times co-founder and publisher, Tracy Baim, is on said list.
The list of media personalities, found on the CPS alumni Web site, www.CPSalumni.org , also includes the late Studs Terkel, Saul Bellow, Nelson Algren, Ethel Payne, Jerome Holtzman and Mike Royko. There are seven Pulitzer Prize winners, seven Peabody Award winners, two National Book Award winners, two members of the Baseball Hall of Fame Writer's Wing and 18 Emmy Award winners listed.
Several CPS alums now have awards named for them, including the late John Chancellor, Peter Lisagor and Herb Block, a three-time Pulitzer Prize-winning editorial cartoonist.
Baim attended Grenneman, Newberry and Walt Disney grammar schools, and is a 1980 graduate of Lane Technical High School.
AFC: Governor's budget proposal hurts HIV services
AFC: Governor's budget proposal hurts HIV services
Copyright by The Windy City Times
2009-03-25
http://www.windycitymediagroup.com/gay/lesbian/news/ARTICLE.php?AID=20747
Illinois Gov. Pat Quinn has proposed a state budget plan that reduces some HIV prevention and care spending by 3 percent, according to a press release from AIDS Foundation of Chicago ( AFC ) . The plan is part of reforms designed to balance the state's budget without eviscerating essential health and human services.
“In these difficult economic times, tens of thousands of HIV-affected Illinoisans need a dependable health and human services safety net to meet their basic needs,” said Mark Ishaug, AFC's president/CEO. “While troubled by HIV funding cuts, we recognize that budgetary reform is urgently needed. We will work closely with Governor Quinn and the General Assembly to find sustainable solutions in order to ensure that essential state services continue for those most vulnerable due to illness, disability, unemployment, and other hardships.”
Gov. Quinn said the state must address a debilitating deficit of nearly $11 billion in fiscal years 2009 and 2010. Without a balance of cost-containment measures and targeted revenue increases, vital state services would need to be eliminated at a time when help is needed the most, he said.
“We recognize that without tax and other revenue increases, reductions to HIV services and other programs for vulnerable citizens would be far greater,” said John Peller, AFC director of government relations. “HIV funding reductions will require even more diligence among state officials to ensure continuity of care and strategic investments in evidence-based interventions that yield the greatest results.”
Copyright by The Windy City Times
2009-03-25
http://www.windycitymediagroup.com/gay/lesbian/news/ARTICLE.php?AID=20747
Illinois Gov. Pat Quinn has proposed a state budget plan that reduces some HIV prevention and care spending by 3 percent, according to a press release from AIDS Foundation of Chicago ( AFC ) . The plan is part of reforms designed to balance the state's budget without eviscerating essential health and human services.
“In these difficult economic times, tens of thousands of HIV-affected Illinoisans need a dependable health and human services safety net to meet their basic needs,” said Mark Ishaug, AFC's president/CEO. “While troubled by HIV funding cuts, we recognize that budgetary reform is urgently needed. We will work closely with Governor Quinn and the General Assembly to find sustainable solutions in order to ensure that essential state services continue for those most vulnerable due to illness, disability, unemployment, and other hardships.”
Gov. Quinn said the state must address a debilitating deficit of nearly $11 billion in fiscal years 2009 and 2010. Without a balance of cost-containment measures and targeted revenue increases, vital state services would need to be eliminated at a time when help is needed the most, he said.
“We recognize that without tax and other revenue increases, reductions to HIV services and other programs for vulnerable citizens would be far greater,” said John Peller, AFC director of government relations. “HIV funding reductions will require even more diligence among state officials to ensure continuity of care and strategic investments in evidence-based interventions that yield the greatest results.”
Report: LGBs more likely to be poor
Report: LGBs more likely to be poor
by Bob Roehr
Copyright by The Windy City Times
2009-03-25
http://www.windycitymediagroup.com/gay/lesbian/news/ARTICLE.php?AID=20730
There are “many reasons to think that LGB people are at least as likely—and perhaps more likely—to experience poverty” than their heterosexual counterparts, according to “Poverty in the Lesbian, Gay, and Bisexual Community,” the first report ever to look at the subject in depth.
The overall rate of poverty in the United States was 12.5 percent in 2007. Lesbian couples and the children of same-sex partners definitely are more likely to live in poverty than are their heterosexual counterparts, the report's lead co-authors Randy Albelda and Lee Badgett told members of the LGBT congressional caucus at a briefing March 20.
Badgett said “the myth of gay affluence” is what motivated her to get involved in the field. Gay magazine surveys have found that their readers are affluent, which is typical of all magazine subscribers, and antigay groups have spun this into an assertion that all gays are rich and powerful and therefore do not need legal protection from discrimination.
Her earlier research debunked this myth, “but that research aimed at the middle of the income distribution.” She said an out lesbian friend working at a homeless shelter for women had noted that 20-25 percent of her clients were gay or bisexual.
“This is a part of the community we don't hear much about, they are invisible in many ways.” The main group of poor LGBT people who have been studied is homeless kids who have run away or been kicked out by their families, she said.
“We know that gay families have less access to the institutional supports that come with marriage and often we see that they don't get as much family support as their heterosexual siblings and colleagues get … and same-sex couples are twice as likely to be uninsured as people who are married.”
Badgett lamented the fact that the 2000 U.S. Census does not ask questions about sexual orientation. Her analysis was based upon data from the census on same sex unmarried couples living together, the 2002 National Survey of Family Growth, and the 2003/5 California Health Interview Survey.
Albelda reminded the audience that their analysis only covers couples. “Individuals are much more likely to be poor than people in two adult households.” There seems to be a synergistic effect between other risk factors for poverty and being gay or lesbian.
“Not surprisingly, lesbian couples have statistically significantly higher poverty rates than married heterosexual couples, and gay men have lower rates,” she said.
About 20 percent of same-sex couples had children living in the household, a lower figure than their heterosexual counterparts. “What was striking was the very high level of poverty among the kids in gay and lesbian couples.” Surprisingly, “ [ t ] he children of gay male couples were much more likely to be poor.”
Albelda said most anti-poverty programs in the U.S. are designed from the default position of a single parent household with children, “there is no incentive whatsoever to claim somebody's income in the household if you don't have to.” This discourages heterosexual marriage.
At the same time, employment based benefits packages “are based on a male breadwinner model” with families in mind. “Gay and lesbian families don't look like either of those,” she said.
One thing that surprised Albelda is the effect of education: “Highly educated lesbian and gay male couples are much less likely to be in poverty than comparably educated married couples. And the reverse is true, those [ lesbians and gay men ] with lower levels of education are much more likely to be poor. So the payoff for education at both ends is much more extreme for gay and lesbian couples.”
Badgett said employment discrimination is a major explanation of lower economic status: “We see a large income gap for gay men compared with heterosexual men.”
Some reports have suggested that gay men are more likely to be self-employed, perhaps by choice, suggesting that perhaps they might be making career choices based on job satisfaction rather than on maximizing income. But Badgett said she has not seen good data confirming any of this.
Another possibility is that some people might be limiting their income in order to meet eligibility qualifications for programs such as housing assistance or the AIDS drug assistance programs.
Albelda readily acknowledged anecdotal accounts of this occurring though she is not aware of any data on the extent of that activity. She said with incomes between about $13-$25 an hour “you run in place and lose valuable support” as your income increases.
Diego M. Sanchez, legislative assistant to Rep. Barney Frank, said this is a problem for people living with HIV in the congressman's Boston area district. “If you make too much money you don't get medical entitlements, you get pulled off of the waiting list for housing.”
He said they are working to try to remove these disincentives in the Medicare and Medicaid program.
“Poverty in the Lesbian, Gay, and Bisexual Community” was prepared by The Williams Institute at UCLA and is available online at www.law.ucla.edu/WilliamsInstitute/pdf/LGBPovertyReport.pdf .
by Bob Roehr
Copyright by The Windy City Times
2009-03-25
http://www.windycitymediagroup.com/gay/lesbian/news/ARTICLE.php?AID=20730
There are “many reasons to think that LGB people are at least as likely—and perhaps more likely—to experience poverty” than their heterosexual counterparts, according to “Poverty in the Lesbian, Gay, and Bisexual Community,” the first report ever to look at the subject in depth.
The overall rate of poverty in the United States was 12.5 percent in 2007. Lesbian couples and the children of same-sex partners definitely are more likely to live in poverty than are their heterosexual counterparts, the report's lead co-authors Randy Albelda and Lee Badgett told members of the LGBT congressional caucus at a briefing March 20.
Badgett said “the myth of gay affluence” is what motivated her to get involved in the field. Gay magazine surveys have found that their readers are affluent, which is typical of all magazine subscribers, and antigay groups have spun this into an assertion that all gays are rich and powerful and therefore do not need legal protection from discrimination.
Her earlier research debunked this myth, “but that research aimed at the middle of the income distribution.” She said an out lesbian friend working at a homeless shelter for women had noted that 20-25 percent of her clients were gay or bisexual.
“This is a part of the community we don't hear much about, they are invisible in many ways.” The main group of poor LGBT people who have been studied is homeless kids who have run away or been kicked out by their families, she said.
“We know that gay families have less access to the institutional supports that come with marriage and often we see that they don't get as much family support as their heterosexual siblings and colleagues get … and same-sex couples are twice as likely to be uninsured as people who are married.”
Badgett lamented the fact that the 2000 U.S. Census does not ask questions about sexual orientation. Her analysis was based upon data from the census on same sex unmarried couples living together, the 2002 National Survey of Family Growth, and the 2003/5 California Health Interview Survey.
Albelda reminded the audience that their analysis only covers couples. “Individuals are much more likely to be poor than people in two adult households.” There seems to be a synergistic effect between other risk factors for poverty and being gay or lesbian.
“Not surprisingly, lesbian couples have statistically significantly higher poverty rates than married heterosexual couples, and gay men have lower rates,” she said.
About 20 percent of same-sex couples had children living in the household, a lower figure than their heterosexual counterparts. “What was striking was the very high level of poverty among the kids in gay and lesbian couples.” Surprisingly, “ [ t ] he children of gay male couples were much more likely to be poor.”
Albelda said most anti-poverty programs in the U.S. are designed from the default position of a single parent household with children, “there is no incentive whatsoever to claim somebody's income in the household if you don't have to.” This discourages heterosexual marriage.
At the same time, employment based benefits packages “are based on a male breadwinner model” with families in mind. “Gay and lesbian families don't look like either of those,” she said.
One thing that surprised Albelda is the effect of education: “Highly educated lesbian and gay male couples are much less likely to be in poverty than comparably educated married couples. And the reverse is true, those [ lesbians and gay men ] with lower levels of education are much more likely to be poor. So the payoff for education at both ends is much more extreme for gay and lesbian couples.”
Badgett said employment discrimination is a major explanation of lower economic status: “We see a large income gap for gay men compared with heterosexual men.”
Some reports have suggested that gay men are more likely to be self-employed, perhaps by choice, suggesting that perhaps they might be making career choices based on job satisfaction rather than on maximizing income. But Badgett said she has not seen good data confirming any of this.
Another possibility is that some people might be limiting their income in order to meet eligibility qualifications for programs such as housing assistance or the AIDS drug assistance programs.
Albelda readily acknowledged anecdotal accounts of this occurring though she is not aware of any data on the extent of that activity. She said with incomes between about $13-$25 an hour “you run in place and lose valuable support” as your income increases.
Diego M. Sanchez, legislative assistant to Rep. Barney Frank, said this is a problem for people living with HIV in the congressman's Boston area district. “If you make too much money you don't get medical entitlements, you get pulled off of the waiting list for housing.”
He said they are working to try to remove these disincentives in the Medicare and Medicaid program.
“Poverty in the Lesbian, Gay, and Bisexual Community” was prepared by The Williams Institute at UCLA and is available online at www.law.ucla.edu/WilliamsInstitute/pdf/LGBPovertyReport.pdf .
New York Times Editorial: A Legal Adviser Worthy of the Job
New York Times Editorial: A Legal Adviser Worthy of the Job
Copyright by The New York Times
Published: March 26, 2009
http://www.nytimes.com/2009/03/26/opinion/26thu3.html?_r=1&ref=opinion
In the Bush administration, the Office of Legal Counsel gave a green light to many objectionable policies, from a lawless expansion of executive power to the use of torture. President Obama has nominated Dawn Johnsen to lead the office, but her nomination is being attacked by Republican senators who still prefer the Bush approach. Ms. Johnsen is superbly qualified and has fought for just the sort of change the office needs. The Senate should confirm her without further delay.
The Office of Legal Counsel is little known to the public, but it plays an important role in guiding national policy. As the legal adviser to the executive branch, it informs the White House and the agencies about what the law requires — and what it prohibits. The office was thrust into the limelight a few years ago when word leaked out of an O.L.C. torture memo that cleared the way for horrific forms of interrogation.
Ms. Johnsen, a law professor at Indiana University, spent five years in the office under President Bill Clinton, including a stint as its acting chief. In response to the abuses of the Bush years, she joined in a much-needed statement of principles, signed by 19 former lawyers from the office. It called for the office to be more transparent and to show greater respect for Congress and the courts.
Republican senators’ harsh criticism of the nomination is groundless. They have questioned Ms. Johnsen’s commitment to fighting terrorism, but their main complaint seems to be her opposition to torture and to extreme views on presidential power. Her critics are outraged that early in her career, Ms. Johnsen worked for an abortion-rights advocacy group, but her views on abortion are hardly unusual.
Senator John Cornyn, a Republican of Texas, has made the bizarre accusation that despite her impressive legal record, Ms. Johnsen has not demonstrated the “requisite seriousness” for the job. It is an odd charge coming from someone who was a staunch defender of former Attorney General Alberto Gonzales, to whom that description actually applied.
Ms. Johnsen made it through the Judiciary Committee on a party-line vote, and there is talk that Republicans may try to filibuster her nomination. That would be an outrage. There is no corner of the executive branch in greater need of a new direction than the Office of Legal Counsel. The impressive Ms. Johnsen is an excellent choice to provide it.
Copyright by The New York Times
Published: March 26, 2009
http://www.nytimes.com/2009/03/26/opinion/26thu3.html?_r=1&ref=opinion
In the Bush administration, the Office of Legal Counsel gave a green light to many objectionable policies, from a lawless expansion of executive power to the use of torture. President Obama has nominated Dawn Johnsen to lead the office, but her nomination is being attacked by Republican senators who still prefer the Bush approach. Ms. Johnsen is superbly qualified and has fought for just the sort of change the office needs. The Senate should confirm her without further delay.
The Office of Legal Counsel is little known to the public, but it plays an important role in guiding national policy. As the legal adviser to the executive branch, it informs the White House and the agencies about what the law requires — and what it prohibits. The office was thrust into the limelight a few years ago when word leaked out of an O.L.C. torture memo that cleared the way for horrific forms of interrogation.
Ms. Johnsen, a law professor at Indiana University, spent five years in the office under President Bill Clinton, including a stint as its acting chief. In response to the abuses of the Bush years, she joined in a much-needed statement of principles, signed by 19 former lawyers from the office. It called for the office to be more transparent and to show greater respect for Congress and the courts.
Republican senators’ harsh criticism of the nomination is groundless. They have questioned Ms. Johnsen’s commitment to fighting terrorism, but their main complaint seems to be her opposition to torture and to extreme views on presidential power. Her critics are outraged that early in her career, Ms. Johnsen worked for an abortion-rights advocacy group, but her views on abortion are hardly unusual.
Senator John Cornyn, a Republican of Texas, has made the bizarre accusation that despite her impressive legal record, Ms. Johnsen has not demonstrated the “requisite seriousness” for the job. It is an odd charge coming from someone who was a staunch defender of former Attorney General Alberto Gonzales, to whom that description actually applied.
Ms. Johnsen made it through the Judiciary Committee on a party-line vote, and there is talk that Republicans may try to filibuster her nomination. That would be an outrage. There is no corner of the executive branch in greater need of a new direction than the Office of Legal Counsel. The impressive Ms. Johnsen is an excellent choice to provide it.
International Herald Tribune Editorial: A green light for medical marijuana
International Herald Tribune Editorial: A green light for medical marijuana
Copyright by The International Herald Tribune
Published: March 26, 2009
http://www.iht.com/articles/2009/03/26/opinion/edmarijuana.php
U.S. Attorney General Eric Holder announced last week that the federal government will no longer prosecute dispensers of medical marijuana if they comply with state law. That should bring relief to people who need marijuana for health reasons and free up law enforcement resources for more important work.
There is considerable evidence that marijuana can be useful in treating pain, nausea, weight loss and other symptoms associated with chemotherapy and H.I.V. and other illnesses. Thirteen states, including California, have legalized marijuana for medical purposes, which remains illegal under federal law.
The Bush administration was, nevertheless, intent on stopping the medical use of marijuana. It brought criminal charges against medical marijuana dispensaries, even ones in states that had made medical use of marijuana legal. Federal prosecutors treated their targets like common drug traffickers.
In 2006, the Food and Drug Administration issued a poorly documented statement disputing marijuana's therapeutic value. It was one of many cases in which the Bush team distorted science to justify its policies.
Mr. Holder's statement does not mean an end to all medical marijuana prosecutions. The Drug Enforcement Administration says it will continue to go after dispensaries that violate state and federal laws, like by operating as fronts for drug dealers or selling to minors.
The Obama Justice Department has an enormous backlog of legal matters to work through, from enforcing long-ignored civil-rights laws to prosecuting white-collar criminals in the banking industry and on Wall Street. Mr. Holder deserves credit for recognizing that going after medical marijuana dispensers is not only bad policy, it is a distraction from work that really matters
Copyright by The International Herald Tribune
Published: March 26, 2009
http://www.iht.com/articles/2009/03/26/opinion/edmarijuana.php
U.S. Attorney General Eric Holder announced last week that the federal government will no longer prosecute dispensers of medical marijuana if they comply with state law. That should bring relief to people who need marijuana for health reasons and free up law enforcement resources for more important work.
There is considerable evidence that marijuana can be useful in treating pain, nausea, weight loss and other symptoms associated with chemotherapy and H.I.V. and other illnesses. Thirteen states, including California, have legalized marijuana for medical purposes, which remains illegal under federal law.
The Bush administration was, nevertheless, intent on stopping the medical use of marijuana. It brought criminal charges against medical marijuana dispensaries, even ones in states that had made medical use of marijuana legal. Federal prosecutors treated their targets like common drug traffickers.
In 2006, the Food and Drug Administration issued a poorly documented statement disputing marijuana's therapeutic value. It was one of many cases in which the Bush team distorted science to justify its policies.
Mr. Holder's statement does not mean an end to all medical marijuana prosecutions. The Drug Enforcement Administration says it will continue to go after dispensaries that violate state and federal laws, like by operating as fronts for drug dealers or selling to minors.
The Obama Justice Department has an enormous backlog of legal matters to work through, from enforcing long-ignored civil-rights laws to prosecuting white-collar criminals in the banking industry and on Wall Street. Mr. Holder deserves credit for recognizing that going after medical marijuana dispensers is not only bad policy, it is a distraction from work that really matters
U.S. cities deal with a surge in shanty towns
U.S. cities deal with a surge in shanty towns
By Jesse Mckinley
Copyright by The International Herald Tribune
Published: March 26, 2009
http://www.iht.com/articles/2009/03/26/america/26tents.php
FRESNO, Calif.: As the operations manager of a outreach center for the homeless here, Paul Stack is used to seeing people down on their luck. What he had never seen before was people living in tents and lean-tos on the railroad lot across from the center.
"They just popped up about 18 months ago," Mr. Stack said. "One day it was empty. The next day, there were people living there."
Like a dozen or so other cities across the nation, Fresno is dealing with an unhappy déjà vu: the arrival of modern-day Hoovervilles, illegal encampments of homeless people that are reminiscent, on a far smaller scale, of Depression-era shantytowns. At his news conference on Tuesday night, President Obama was asked directly about the tent cities and responded by saying that it was "not acceptable for children and families to be without a roof over their heads in a country as wealthy as ours."
While encampments and street living have always been a part of the landscape in big cities like Los Angeles and New York, these new tent cities have taken root — or grown from smaller enclaves of the homeless as more people lose jobs and housing — in such disparate places as Nashville, Olympia, Wash., and St. Petersburg, Fla.
In Seattle, homeless residents in the city's 100-person encampment call it Nickelsville, an unflattering reference to the mayor, Greg Nickels. A tent city in Sacramento prompted Gov. Arnold Schwarzenegger to announce a plan Wednesday to shift the entire 125-person encampment to a nearby fairground. That came after a recent visit by "The Oprah Winfrey Show" set off such a news media stampede that some fed-up homeless people complained of overexposure and said they just wanted to be left alone.
The problem in Fresno is different in that it is both chronic and largely outside the national limelight. Homelessness here has long been fed by the ups and downs in seasonal and subsistence jobs in agriculture, but now the recession has cast a wider net and drawn in hundreds of the newly homeless — from hitchhikers to truck drivers to electricians.
"These are able-bodied folks that did day labor, at minimum wage or better, who were previously able to house themselves based on their income," said Michael Stoops, the executive director of the National Coalition for the Homeless, an advocacy group based in Washington.
The surging number of homeless people in Fresno, a city of 500,000 people, has been a surprise. City officials say they have three major encampments near downtown and smaller settlements along two highways. All told, as many 2,000 people are homeless here, according to Gregory Barfield, the city's homeless prevention and policy manager, who said that drug use, prostitution and violence were all too common in the encampments.
"That's all part of that underground economy," Mr. Barfield said. "It's what happens when a person is trying to survive."
He said the city planned to begin "triage" on the encampments in the next several weeks, to determine how many people needed services and permanent housing. "We're treating it like any other disaster area," Mr. Barfield said.
Mr. Barfield took over his newly created position in January, after the county and city adopted a 10-year plan to address homelessness. A class-action lawsuit brought on behalf of homeless people against the city and the California Department of Transportation led to a $2.35 million settlement in 2008, making money available to about 350 residents who had had their belongings discarded in sweeps by the city.
The growing encampments led the city to place portable toilets and security guards near one area known as New Jack City, named after a dark and drug-filled 1991 movie. But that just attracted more homeless people.
"It was just kind of an invitation to move in," said Mr. Stack, the outreach center manager.
On a recent afternoon, nobody seemed thrilled to be living in New Jack City, a filthy collection of rain- and wind-battered tents in a garbage-strewn lot. Several weary-looking residents sat on decaying sofas as a pair of pit bulls chained to a fence howled.
Northwest of New Jack City sits a somewhat less grim encampment. It is sometimes called Taco Flats or Little Tijuana because of the large number of Latino residents, many of whom were drawn to Fresno on the promise of agricultural jobs, which have dried up in the face of the poor economy and a three-year drought.
Guillermo Flores, 32, said he had looked for work in the fields and in fast food, but had found nothing. For the last eight months, he has collected cans, recycling them for $5 to $10 a day, and lived in a hand-built, three-room shack, a home that he takes pride in, with a door, clean sheets on his bed and a bowl full of fresh apples in his propane-powered kitchen area.
"I just built it because I need it," said Mr. Flores, as he cooked a dinner of chili peppers, eggs and onions over a fire. "The only problem I have is the spiders."
Dozens of homeless men and women here have found more organized shelter at the Village of Hope, a collection of 8-by-10-foot storage sheds built by the nonprofit group Poverello House and overseen by Mr. Stack. Planted in a former junkyard behind a chain-link fence, each unit contains two cots, sleeping bags and a solar-powered light.
Doug Brown, a freelance electrical engineer, said he had discovered the Village of Hope while unemployed a few years back and had returned after losing his job in October. Mr. Stoops, of the homeless coalition, predicted that the population at such new Hoovervilles could grow as those without places to live slowly burned through their options and joined the ranks of the chronically homeless, many of whom are indigent as a result of illiteracy, alcoholism, mental illness and drug abuse.
That mix is already evident in a walk around Taco Flats, where Sean Langer, 42, who lost a trucking job in December and could pass for a soccer dad, lives in his car in front of a sturdy shanty that is home to Barbara Smith, 41, a crack addict with a wild cackle for a laugh.
"This is a one-bedroom house," said Ms. Smith, proudly taking a visitor through her home built with scrap wood and scavenged two-by-fours. "We got a roof, and it does not leak."
During the day, the camp can seem peaceful. American flags fly over some shanties, and neighbors greet one another. Some feed pets, while others build fires and chat.
Daniel Kent, a clean-shaven 27-year-old from Oregon, has been living in Taco Flats for three months after running out of money on a planned hitchhiking trip to Florida. He did manage to earn $35 a day holding up a going-out-of-business sign for Mervyn's until the department store actually went of out business.
Mr. Kent planned to attend a job fair soon, but said he did not completely mind living outdoors.
"We got veterans out here; we got people with heart, proud to be who they are," Mr. Kent said. "Regardless of living situations, it doesn't change the heart. There's some good people out here, really good people."
But the danger after dark is real. Ms. Smith, who lost an eye after being shot in the face years ago, said she had seen two people killed in New Jack City, prompting her to move to Taco Flats and try to quit drugs. Her companion, Willie Mac, 53, a self-described youth minister, said he was "waiting on her to get herself right with the Lord."
Ms. Smith said her dream was simple: "To get out of here, get off the street, have our own home."
By Jesse Mckinley
Copyright by The International Herald Tribune
Published: March 26, 2009
http://www.iht.com/articles/2009/03/26/america/26tents.php
FRESNO, Calif.: As the operations manager of a outreach center for the homeless here, Paul Stack is used to seeing people down on their luck. What he had never seen before was people living in tents and lean-tos on the railroad lot across from the center.
"They just popped up about 18 months ago," Mr. Stack said. "One day it was empty. The next day, there were people living there."
Like a dozen or so other cities across the nation, Fresno is dealing with an unhappy déjà vu: the arrival of modern-day Hoovervilles, illegal encampments of homeless people that are reminiscent, on a far smaller scale, of Depression-era shantytowns. At his news conference on Tuesday night, President Obama was asked directly about the tent cities and responded by saying that it was "not acceptable for children and families to be without a roof over their heads in a country as wealthy as ours."
While encampments and street living have always been a part of the landscape in big cities like Los Angeles and New York, these new tent cities have taken root — or grown from smaller enclaves of the homeless as more people lose jobs and housing — in such disparate places as Nashville, Olympia, Wash., and St. Petersburg, Fla.
In Seattle, homeless residents in the city's 100-person encampment call it Nickelsville, an unflattering reference to the mayor, Greg Nickels. A tent city in Sacramento prompted Gov. Arnold Schwarzenegger to announce a plan Wednesday to shift the entire 125-person encampment to a nearby fairground. That came after a recent visit by "The Oprah Winfrey Show" set off such a news media stampede that some fed-up homeless people complained of overexposure and said they just wanted to be left alone.
The problem in Fresno is different in that it is both chronic and largely outside the national limelight. Homelessness here has long been fed by the ups and downs in seasonal and subsistence jobs in agriculture, but now the recession has cast a wider net and drawn in hundreds of the newly homeless — from hitchhikers to truck drivers to electricians.
"These are able-bodied folks that did day labor, at minimum wage or better, who were previously able to house themselves based on their income," said Michael Stoops, the executive director of the National Coalition for the Homeless, an advocacy group based in Washington.
The surging number of homeless people in Fresno, a city of 500,000 people, has been a surprise. City officials say they have three major encampments near downtown and smaller settlements along two highways. All told, as many 2,000 people are homeless here, according to Gregory Barfield, the city's homeless prevention and policy manager, who said that drug use, prostitution and violence were all too common in the encampments.
"That's all part of that underground economy," Mr. Barfield said. "It's what happens when a person is trying to survive."
He said the city planned to begin "triage" on the encampments in the next several weeks, to determine how many people needed services and permanent housing. "We're treating it like any other disaster area," Mr. Barfield said.
Mr. Barfield took over his newly created position in January, after the county and city adopted a 10-year plan to address homelessness. A class-action lawsuit brought on behalf of homeless people against the city and the California Department of Transportation led to a $2.35 million settlement in 2008, making money available to about 350 residents who had had their belongings discarded in sweeps by the city.
The growing encampments led the city to place portable toilets and security guards near one area known as New Jack City, named after a dark and drug-filled 1991 movie. But that just attracted more homeless people.
"It was just kind of an invitation to move in," said Mr. Stack, the outreach center manager.
On a recent afternoon, nobody seemed thrilled to be living in New Jack City, a filthy collection of rain- and wind-battered tents in a garbage-strewn lot. Several weary-looking residents sat on decaying sofas as a pair of pit bulls chained to a fence howled.
Northwest of New Jack City sits a somewhat less grim encampment. It is sometimes called Taco Flats or Little Tijuana because of the large number of Latino residents, many of whom were drawn to Fresno on the promise of agricultural jobs, which have dried up in the face of the poor economy and a three-year drought.
Guillermo Flores, 32, said he had looked for work in the fields and in fast food, but had found nothing. For the last eight months, he has collected cans, recycling them for $5 to $10 a day, and lived in a hand-built, three-room shack, a home that he takes pride in, with a door, clean sheets on his bed and a bowl full of fresh apples in his propane-powered kitchen area.
"I just built it because I need it," said Mr. Flores, as he cooked a dinner of chili peppers, eggs and onions over a fire. "The only problem I have is the spiders."
Dozens of homeless men and women here have found more organized shelter at the Village of Hope, a collection of 8-by-10-foot storage sheds built by the nonprofit group Poverello House and overseen by Mr. Stack. Planted in a former junkyard behind a chain-link fence, each unit contains two cots, sleeping bags and a solar-powered light.
Doug Brown, a freelance electrical engineer, said he had discovered the Village of Hope while unemployed a few years back and had returned after losing his job in October. Mr. Stoops, of the homeless coalition, predicted that the population at such new Hoovervilles could grow as those without places to live slowly burned through their options and joined the ranks of the chronically homeless, many of whom are indigent as a result of illiteracy, alcoholism, mental illness and drug abuse.
That mix is already evident in a walk around Taco Flats, where Sean Langer, 42, who lost a trucking job in December and could pass for a soccer dad, lives in his car in front of a sturdy shanty that is home to Barbara Smith, 41, a crack addict with a wild cackle for a laugh.
"This is a one-bedroom house," said Ms. Smith, proudly taking a visitor through her home built with scrap wood and scavenged two-by-fours. "We got a roof, and it does not leak."
During the day, the camp can seem peaceful. American flags fly over some shanties, and neighbors greet one another. Some feed pets, while others build fires and chat.
Daniel Kent, a clean-shaven 27-year-old from Oregon, has been living in Taco Flats for three months after running out of money on a planned hitchhiking trip to Florida. He did manage to earn $35 a day holding up a going-out-of-business sign for Mervyn's until the department store actually went of out business.
Mr. Kent planned to attend a job fair soon, but said he did not completely mind living outdoors.
"We got veterans out here; we got people with heart, proud to be who they are," Mr. Kent said. "Regardless of living situations, it doesn't change the heart. There's some good people out here, really good people."
But the danger after dark is real. Ms. Smith, who lost an eye after being shot in the face years ago, said she had seen two people killed in New Jack City, prompting her to move to Taco Flats and try to quit drugs. Her companion, Willie Mac, 53, a self-described youth minister, said he was "waiting on her to get herself right with the Lord."
Ms. Smith said her dream was simple: "To get out of here, get off the street, have our own home."
UK to investigate Guantánamo torture claim
UK to investigate Guantánamo torture claim
By Megan Murphy
Copyright The Financial Times Limited 2009
Published: March 26 2009 15:47 | Last updated: March 26 2009 15:47
http://www.ft.com/cms/s/0/c682092c-1a19-11de-9f91-0000779fd2ac.html
Police are to investigate whether British agents were complicit in the alleged torture of former Guantánamo Bay detainee Binyam Mohamed.
Baroness Scotland, the Attorney General, announced on Thursday that she would ask the Commissioner of the Metropolitan Police Force to probe allegations of “possible criminal wrongdoing” in relation to Mr Mohamed, who was released from the US prison camp last month following a lengthy legal fight.
He claims that he was repeatedly tortured after being arrested in Pakistan in 2002 and flown to detention centres in Morocco and Afghanistan as part of the US government’s programme of “extraordinary rendition” before being sent to Guantánamo.
The Met inquiry will focus on his allegations that British security officials fed information about his case to his captors for use in their interrogations.
An MI5 agent who questioned Mr Mohamed in Morocco, known only as “Witness B”, has denied threatening or putting any pressure on him.
The Attorney General, who first began weighing whether to involve the police in October, said she had given the matter “very careful consideration” before referring the investigation to the police.
She said: ”Any decision on whether any person should be charged with a criminal offence can only be taken following the police investigation on the basis of an independent assessment of the evidence and the public interest, in accordance with the Code for Crown Prosecutors.”
Mr Mohamed, who was born in Ethiopia but lived in the UK before his arrest in Pakistan, was held in Guantánamo for nearly five years. He has never been charged or tried with any crime.
Human rights groups, which have long pushed for a full judicial inquiry into Mr Mohamed’s treatment, gave a cautious backing to news of the investigation.
“While many will see the Attorney General’s announcement as coming better late than never, the five-month delay in reporting such a serious suspected offence to the police is far from an ideal example of respect for the law,” said Shami Chakrabarti, director of Liberty.
By Megan Murphy
Copyright The Financial Times Limited 2009
Published: March 26 2009 15:47 | Last updated: March 26 2009 15:47
http://www.ft.com/cms/s/0/c682092c-1a19-11de-9f91-0000779fd2ac.html
Police are to investigate whether British agents were complicit in the alleged torture of former Guantánamo Bay detainee Binyam Mohamed.
Baroness Scotland, the Attorney General, announced on Thursday that she would ask the Commissioner of the Metropolitan Police Force to probe allegations of “possible criminal wrongdoing” in relation to Mr Mohamed, who was released from the US prison camp last month following a lengthy legal fight.
He claims that he was repeatedly tortured after being arrested in Pakistan in 2002 and flown to detention centres in Morocco and Afghanistan as part of the US government’s programme of “extraordinary rendition” before being sent to Guantánamo.
The Met inquiry will focus on his allegations that British security officials fed information about his case to his captors for use in their interrogations.
An MI5 agent who questioned Mr Mohamed in Morocco, known only as “Witness B”, has denied threatening or putting any pressure on him.
The Attorney General, who first began weighing whether to involve the police in October, said she had given the matter “very careful consideration” before referring the investigation to the police.
She said: ”Any decision on whether any person should be charged with a criminal offence can only be taken following the police investigation on the basis of an independent assessment of the evidence and the public interest, in accordance with the Code for Crown Prosecutors.”
Mr Mohamed, who was born in Ethiopia but lived in the UK before his arrest in Pakistan, was held in Guantánamo for nearly five years. He has never been charged or tried with any crime.
Human rights groups, which have long pushed for a full judicial inquiry into Mr Mohamed’s treatment, gave a cautious backing to news of the investigation.
“While many will see the Attorney General’s announcement as coming better late than never, the five-month delay in reporting such a serious suspected offence to the police is far from an ideal example of respect for the law,” said Shami Chakrabarti, director of Liberty.
Wednesday, March 25, 2009
Another McCain Throws Down a Challenge
Another McCain Throws Down a Challenge
By Kathleen Parker
Copyright by The Washington Post
Wednesday, March 25, 2009; Page A15
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/24/AR2009032402465.html
The GOP's identity crisis just got more interesting with the media splash of Meghan McCain, daughter of the senator who did not become president.
Young McCain, who began blogging during her father's presidential campaign, recently made waves at the Daily Beast when she picked a fight with conservative media mavens Ann Coulter and Laura Ingraham.
This is enough sport to make the little dog laugh, to say nothing of the dish and the spoon.
McCain, just 24, is one smart cookie. In a matter of weeks, she has created a brand, presenting herself as a fresh face of her daddy's party and a voice for young conservatives. Strategically speaking, what better way to launch herself than to challenge the reigning diva herself, Miz Coulter?
Madonna, meet Britney.
McCain jammed traffic on Tina Brown's site with her charge that Coulter is bad for the party. In a voice that is sometimes, alas, reminiscent of a coed's tweet, she wrote: "I straight up don't understand this woman or her popularity. I find her offensive, radical, insulting, and confusing all at the same time."
Claiming that Coulter could be the poster woman for the "most extreme side of the Republican Party," McCain offered herself as the opposite. Bzzzzzt. Give that girl a talk show!
Indeed, McCain's generation is more moderate, especially on social issues. This isn't news. Yet, reaction from the more-established right has been a tad intolerant.
Among criticism now familiar to anyone who has dared contradict or question the GOP's wisdom is that Meghan McCain is a "useful idiot" to liberals who will use her to further diminish Republicans. Or that she is poking her father's party just to draw attention to herself.
'Tis a fact that McCain has suddenly surged as a popular talk show guest. This happens when one says something provocative in a town where 400 producers are trying to plug 10,000 talking-head spots. And of course, Coulter would never say or do anything provocative in the interest of self-promotion. Calling Al Gore a "total fag," or saying that Jews should be "perfected" by conversion to Christianity, could hardly be construed as anything but profoundly constructive.
Next, McCain went after Ingraham, who had parodied McCain on her radio show in a Valley-girl voice: "Okay, I was really hoping that I was going to get that role in 'The Real World,' but then I realized that, well, they don't like plus-sized models."
McCain fired back at the athletically trim Ingraham with a new blog posting: "Quit talking about my weight, Laura Ingraham."
Boom! McCain was on "The View" encouraging women to stop worrying so much about their bodies. In an inspired flourish, she suggested that Ingraham "kiss my fat [ahem]."
Well, if McCain doesn't make it in journalism, she has a future in marketing. She has learned, perhaps from a lifetime of observing political strategy, how and when to pick a fight. Trying to provoke Coulter (who so far has gamely ignored her) was shrewd. And engaging American women in solidarity against market-imposed body images was a stroke of genius.
Yes, of course, a 24-year-old political pundette doesn't find her way onto "Larry King Live" without a famous name. McCain is interesting because of who she is, not because of what she has accomplished. Liberals found young Ron Reagan equally riveting for the same reason.
On the other hand, McCain is also a successful blogger with a following. She has established a voice and an audience. And the GOP is, allegedly, hoping to expand its tent.
Moreover, thanks to the "Internets," as our former president liked to say, young people are gaining influence sooner than ever before. One of the smarter, slicker political Web sites, Scoop44, is produced, written and edited by high school and college students across the country. Its editor in chief, Alexander Heffner, is a 19-year-old undergraduate at Harvard.
As Heffner put it in a February interview, he and his colleagues belong to a generation that was galvanized by Barack Obama to take their civic responsibility seriously. Meghan McCain may be simply another manifestation of that call to engagement. And she isn't wrong on the substance of her charges.
The GOP's extreme voices are a turnoff, not just to young people but to millions of Americans who might otherwise be attracted to conservative principles. Who better to point that out than a young maverick named McCain?
kparker@kparker.com
By Kathleen Parker
Copyright by The Washington Post
Wednesday, March 25, 2009; Page A15
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/24/AR2009032402465.html
The GOP's identity crisis just got more interesting with the media splash of Meghan McCain, daughter of the senator who did not become president.
Young McCain, who began blogging during her father's presidential campaign, recently made waves at the Daily Beast when she picked a fight with conservative media mavens Ann Coulter and Laura Ingraham.
This is enough sport to make the little dog laugh, to say nothing of the dish and the spoon.
McCain, just 24, is one smart cookie. In a matter of weeks, she has created a brand, presenting herself as a fresh face of her daddy's party and a voice for young conservatives. Strategically speaking, what better way to launch herself than to challenge the reigning diva herself, Miz Coulter?
Madonna, meet Britney.
McCain jammed traffic on Tina Brown's site with her charge that Coulter is bad for the party. In a voice that is sometimes, alas, reminiscent of a coed's tweet, she wrote: "I straight up don't understand this woman or her popularity. I find her offensive, radical, insulting, and confusing all at the same time."
Claiming that Coulter could be the poster woman for the "most extreme side of the Republican Party," McCain offered herself as the opposite. Bzzzzzt. Give that girl a talk show!
Indeed, McCain's generation is more moderate, especially on social issues. This isn't news. Yet, reaction from the more-established right has been a tad intolerant.
Among criticism now familiar to anyone who has dared contradict or question the GOP's wisdom is that Meghan McCain is a "useful idiot" to liberals who will use her to further diminish Republicans. Or that she is poking her father's party just to draw attention to herself.
'Tis a fact that McCain has suddenly surged as a popular talk show guest. This happens when one says something provocative in a town where 400 producers are trying to plug 10,000 talking-head spots. And of course, Coulter would never say or do anything provocative in the interest of self-promotion. Calling Al Gore a "total fag," or saying that Jews should be "perfected" by conversion to Christianity, could hardly be construed as anything but profoundly constructive.
Next, McCain went after Ingraham, who had parodied McCain on her radio show in a Valley-girl voice: "Okay, I was really hoping that I was going to get that role in 'The Real World,' but then I realized that, well, they don't like plus-sized models."
McCain fired back at the athletically trim Ingraham with a new blog posting: "Quit talking about my weight, Laura Ingraham."
Boom! McCain was on "The View" encouraging women to stop worrying so much about their bodies. In an inspired flourish, she suggested that Ingraham "kiss my fat [ahem]."
Well, if McCain doesn't make it in journalism, she has a future in marketing. She has learned, perhaps from a lifetime of observing political strategy, how and when to pick a fight. Trying to provoke Coulter (who so far has gamely ignored her) was shrewd. And engaging American women in solidarity against market-imposed body images was a stroke of genius.
Yes, of course, a 24-year-old political pundette doesn't find her way onto "Larry King Live" without a famous name. McCain is interesting because of who she is, not because of what she has accomplished. Liberals found young Ron Reagan equally riveting for the same reason.
On the other hand, McCain is also a successful blogger with a following. She has established a voice and an audience. And the GOP is, allegedly, hoping to expand its tent.
Moreover, thanks to the "Internets," as our former president liked to say, young people are gaining influence sooner than ever before. One of the smarter, slicker political Web sites, Scoop44, is produced, written and edited by high school and college students across the country. Its editor in chief, Alexander Heffner, is a 19-year-old undergraduate at Harvard.
As Heffner put it in a February interview, he and his colleagues belong to a generation that was galvanized by Barack Obama to take their civic responsibility seriously. Meghan McCain may be simply another manifestation of that call to engagement. And she isn't wrong on the substance of her charges.
The GOP's extreme voices are a turnoff, not just to young people but to millions of Americans who might otherwise be attracted to conservative principles. Who better to point that out than a young maverick named McCain?
kparker@kparker.com
Drugs, Guns and a Reality Check/Clinton Says U.S. Feeds Mexico Drug Trade/Clinton: U.S. Drug Policies Failed, Fueled Mexico's Drug War
Drugs, Guns and a Reality Check
By Eugene Robinson
Copyright by The Washington Post
Friday, March 27, 2009; Page A17
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/26/AR2009032603115.html
It's an indictment of our fact-averse political culture that a statement of the blindingly obvious could sound so revolutionary. "Our insatiable demand for illegal drugs fuels the drug trade," Secretary of State Hillary Clinton told reporters on her plane Wednesday as she flew to Mexico for an official visit. "Our inability to prevent weapons from being illegally smuggled across the border . . . causes the deaths of police, of soldiers and civilians."
Amazingly, U.S. officials have avoided facing these facts for decades. This is not just an intellectual blind spot but a moral failure, one that has had horrific consequences for Mexico, Colombia, Peru, Bolivia and other Latin American and Caribbean nations. Clinton deserves high praise for acknowledging that the United States bears "shared responsibility" for the drug-fueled violence sweeping Mexico, which has claimed more than 7,000 lives since the beginning of 2008. But that means we will also share responsibility for the next 7,000 killings as well.
Our long-running "war on drugs," focusing on the supply side of the equation, has been an utter disaster. Domestically, we've locked up hundreds of thousands of street-level dealers, some of whom genuinely deserve to be in prison and some of whom don't. It made no difference. According to a 2007 University of Michigan study, 84 percent of high school seniors nationwide said they could obtain marijuana "fairly easily" or "very easily." The figure for amphetamines was 50 percent; for cocaine, 47 percent; for heroin, 30 percent.
At the same time, we've persisted in a Sisyphean attempt to cut off the drug supply at or near the source. When I was The Washington Post's correspondent in South America, I once took a nerve-racking helicopter ride to visit a U.S.-funded military base in the Upper Huallaga Valley of Peru. It was the place where most of the country's coca -- the plant from which cocaine is processed -- was being grown, and the valley was crawling with Maoist guerrillas who funded their insurgency with money they extorted from the coca growers and traffickers. Eventually, the coca business was eliminated in the Upper Huallaga. But now it's flourishing in other parts of Peru, and last year authorities there seized a record 30 tons of cocaine -- meaning, by rule of thumb, that at least 10 times that much was probably produced and shipped.
In Colombia, I saw how the huge, brutally violent Medellin and Cali cocaine cartels threatened to turn the country into the world's first "narco-state." The Colombian government, again with U.S. assistance, managed to pulverize these sprawling criminal organizations into smaller units, but the business continues to thrive -- and to provide most of the cocaine that finds its way to the American market. Last year, Colombian authorities seized 119 tons of cocaine. Money from the drug trade sustains the longest-running leftist insurgency in the hemisphere. Ever inventive, the Colombian traffickers have gone so far as to build their own miniature submarines to smuggle illicit cargo into the United States.
And now Mexico has become the focal point of the drug trade, with its cartels blasting their way to dominance in the business of bringing marijuana, methamphetamine, cocaine and other drugs to the American market. Violence among drug gangs, not just along the border but throughout the country, has reached crisis levels. The government's strategy is to break up the big cartels, as the Colombians did. But even if authorities succeed, the industry will live on.
In the case of Mexico, there's a complicating factor: This is a two-way problem. While drugs are being moved north across the border, powerful assault weapons -- purchased in the United States -- are being moved south to arm the cartels' foot soldiers. Clinton's statement about "shared responsibility" recognizes that if we expect Mexico to do something about the flow of drugs, we're obliged to do something about the counterflow of guns.
First, though, let's be honest with ourselves. This whole disruptive, destabilizing enterprise has one purpose, which is to supply the U.S. market with illegal drugs. As long as the demand exists, entrepreneurs will find a way to meet it. The obvious demand-side solution -- legalization -- would do more harm than good with some drugs, but maybe not with others. We need to examine all options. It's time to put everything on the table, because all we've accomplished so far is to bring the terrible violence of the drug trade ever closer to home.
eugenerobinson@washpost.com
Clinton Says U.S. Feeds Mexico Drug Trade
By MARK LANDLER
Copyright by The New York Times
Published: March 25, 2009
http://www.nytimes.com/2009/03/26/world/americas/26mexico.html?scp=1&sq=hillary%20clinton%20mexico%20drug&st=cse
MEXICO CITY — Seeking to ease a cross-border relationship strained by drug trafficking, Secretary of State Hillary Rodham Clinton arrived here Wednesday and offered the clearest acknowledgment yet from an Obama administration official of the role the United States plays in the violent narcotics trade in Mexico.
“Our insatiable demand for illegal drugs fuels the drug trade,” Mrs. Clinton said, using unusually blunt language. “Our inability to prevent weapons from being illegally smuggled across the border to arm these criminals causes the deaths of police officers, soldiers and civilians.”
Mrs. Clinton’s remarks were coupled with a pledge that the administration would seek $80 million from Congress to provide Mexican authorities with three Black Hawk helicopters to help the police track drug runners.
She also came bearing a new White House initiative, announced Tuesday, to deploy 450 more law enforcement officers at the border, and crack down on the smuggling of guns and drug money into Mexico.
The diplomatic offensive, which will include visits by several other senior American officials ahead of President Obama’s visit next month, was calculated to mollify Mexican officials, who have chafed in recent years at what they regard as Mexico-bashing in Washington. It seems to have worked.
Patricia Espinosa, Mexico’s foreign secretary, said the new measures were “much along the line of cooperation that we have been trying to build upon.” But, she added, “there is always room for improvement in the U.S.”
Indeed, some of the Obama administration’s measures are likely to run squarely into American political realities. For example, early indications that Mr. Obama will push for stricter controls on the sale of assault rifles have already set off an outcry among gun-control opponents.
“Politically, this is a very big hurdle in our Congress,” Mrs. Clinton conceded.
Since last year, battles between law enforcement authorities and cartels, and other drug-related violence, have resulted in more than 7,200 deaths in Mexico, raising doubts about the government’s control over parts of its territory. The violence has also begun to spill across the border.
Mrs. Clinton met with the President Felipe Calderón and praised his campaign to root out corruption in the police force and the courts. She said Mr. Obama had not decided whether to post National Guard troops along the border, an issue that has aroused opposition in Mexico.
On Wednesday, the Mexican Army said it had arrested one of the country’s most-wanted drug smugglers, Héctor Huerta, near Monterrey, the northern city Mrs. Clinton will visit Thursday.
Mrs. Clinton said that in addition to sending the helicopters, the United States would help supply Mexican law enforcement officers with night-vision goggles, body armor and other equipment to battle the cartels, which are heavily armed.
“We’ve got to figure out how to stop these bad guys,” she said. “These criminals are outgunning the law enforcement officials.”
Drugs are not the only issue vexing relations between the United States and Mexico. Congress recently canceled funds for a pilot program to allow Mexican trucks to haul cargo on American highways. Mexico retaliated by imposing $2.4 billion in tariffs on 89 American exports.
Mexican officials complain about mixed signals from the United States, noting that even as the administration steps up law enforcement help on the border, Congress has cut back funds for a three-year, $1.4 billion drug countertrafficking campaign called the Merida Initiative.
Even small slights rankle. When Forbes magazine put the Mexican drug lord Joaquín Guzmán, known as El Chapo, on its list of the world’s richest people, it elicited more attention, and offense, in Mexico than when Mr. Obama acknowledged that the drug trade was a two-way street.
“There have been lots of different voices from the Obama administration,” said Andrew Selee, director of the Mexico Institute at the Woodrow Wilson International Center for Scholars. “Hillary Clinton’s mission is to make sure there is a single voice.”
Mrs. Clinton said the administration was retooling the truck program to get it through Congress, and she expressed optimism that lawmakers were receptive but did not give details.
She defended the decision of Congress to withhold funds for the Merida Initiative, saying the lawmakers were watching to see that the $700 million already spent was being used wisely. The administration, she said, was weighing whether to ask for more money for the program.
The agreement between the nations was most vivid in comments by Ms. Espinosa and Mrs. Clinton on the need to crack down on gun smuggling. In December, Ms. Espinosa stood by as Condoleezza Rice, then the secretary of state, denied a link between the expiration of an assault weapons ban and drug violence.
“It is shocking to hear an American politician admit there is an issue,” said Denise Dresser, a prominent Mexican commentator and political scientist.
There were echoes of the presidential candidate in Mrs. Clinton’s discussion of America’s fitful war on drugs. She mentioned many failed efforts, going back to the “Just Say No” campaign.
“Clearly what we have been doing has not worked,” she said.
Marc Lacey contributed reporting.
Clinton: U.S. Drug Policies Failed, Fueled Mexico's Drug War
By Mary Beth Sheridan
Copyright by The Washington Post
Wednesday, March 25, 2009; 2:51 PM
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/25/AR2009032501034.html?hpid=topnews
MEXICO CITY, March 25 -- Secretary of State Hillary Rodham Clinton traveled to Mexico on Wednesday with a stark mea culpa, saying that decades of U.S. anti-narcotics policies had been a failure and contributed to the explosion of drug violence south of the border.
"Clearly what we've been doing has not worked," Clinton told reporters on her plane at the start of her two-day trip. "It is unfair for our incapacity to have effective policies" on curbing drug use, narcotics shipments and the flow of guns "to be creating a situation where people are holding the Mexican government and people responsible. That's not right."
Clinton's comments appeared to be the most sweeping yet by a top Obama administration official accepting a U.S. role in the drug havoc in Mexico. More than 7,000 Mexicans have been killed since January 2008, as cartels have warred over trafficking routes and lashed out at the government for deploying the military against them.
Mexican officials have long complained that the U.S. government pointed the finger at its neighbor while ignoring how American demand for cocaine, marijuana, heroin and methamphetamines fueled the trade. Mexican authorities also blame some of the violence on the flow of American guns, which have been used in about 90 percent of the drug killings, according to both U.S. and Mexican officials.
Clinton's comments came at the start of a U.S. blitz to improve relations at a moment when Mexico is facing perhaps the greatest challenge to its stability in a century. The Obama administration announced Tuesday it was sending hundreds more agents and extra high-tech gear to the border to intercept weapons and drug proceeds heading south. U.S. border states have become alarmed about a possible spillover of the drug violence, and Congress has held a flurry of hearings on the bloodshed and the potential threat to Mexico's institutions.
Clinton signaled that the U.S. government planned to do more. She vowed to press for swift delivery of equipment promised under the Merida Initiative, a three-year, $1.4 billion package of anti-drug assistance to Mexico and Central America. Mexican officials and U.S. lawmakers say there are long lag times for helicopters and other gear that are desperately needed. In addition, Congress has approved only $700 million of the $950 million that the Bush administration requested for the program since it began last year.
Clinton also the administration would "try to get more tools to go after the gun dealers" and those who purchase weapons to pass on to the cartels. She did not elaborate. Several U.S. lawmakers have already balked at the idea of cracking down on guns on the American side of the border, and the idea could face an uphill battle in Congress.
Mexican officials, historically sensitive to criticism from their richer, more powerful neighbor, have bristled at conclusions in U.S. military reports and in hearings recently that their government was losing control over parts of the country. President Felipe Calderón has described such statements as part of a "campaign" against his country.
Seeking to heal the strain, Clinton went out of her way to accept U.S. responsibility for the problem. She said drug demand in the United States remained "insatiable," blaming a lack of treatment facilities and insufficient campaigns to discourage narcotics abuse. American drug abusers provide Mexican traffickers with an estimated $15 to 25 billion a year.
"Neither interdiction [of drugs] nor reducing demand have been successful," Clinton said, noting that "we have been pursuing these strategies for 30 years."
"We've got to take a hard look at what we can do" to cut off the supply of drugs and "stop the bad guys," the secretary added. "The amount of violence going on because of these drug wars in Mexico is horrific."
Clinton's assessment appeared to be at odds with some conclusions by U.S. anti-drug officials. The Drug Enforcement Agency says that traffickers have had an increasingly hard time getting their shipments over the U.S. border, resulting in higher prices and lower purity for cocaine on American streets.
Michael Braun, who recently retired as a senior DEA official, told a congressional hearing this month that the U.S. military and law-enforcement agencies had dealt significant blows to traffickers' transportation networks.
"The seizure rates are off the charts for the last three or four years," he said. One of the reasons for the escalating violence in Mexico, he said, was the effectiveness of the U.S. operations against traffickers' transportation and financial infrastructure.
U.S. authorities, including Clinton, have lauded Calderón for dispatching 45,000 troops to battle the cartels.
While emphasizing the U.S. desire to cooperate on drugs, Clinton said she wanted her trip to also illustrate the broad range of issues the two countries cooperate on routinely, ranging from trade to education to the environment.
"The relationship we have with Mexico is much broader and deeper" than the drug issue, she said.
Clinton is planning to travel Thursday to Monterrey, Mexico's business capital, before heading back to Washington. Homeland Security Secretary Janet Napolitano and Attorney General Eric H. Holder Jr. are also scheduled to visit Mexico before Obama arrives in mid-April.
By Eugene Robinson
Copyright by The Washington Post
Friday, March 27, 2009; Page A17
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/26/AR2009032603115.html
It's an indictment of our fact-averse political culture that a statement of the blindingly obvious could sound so revolutionary. "Our insatiable demand for illegal drugs fuels the drug trade," Secretary of State Hillary Clinton told reporters on her plane Wednesday as she flew to Mexico for an official visit. "Our inability to prevent weapons from being illegally smuggled across the border . . . causes the deaths of police, of soldiers and civilians."
Amazingly, U.S. officials have avoided facing these facts for decades. This is not just an intellectual blind spot but a moral failure, one that has had horrific consequences for Mexico, Colombia, Peru, Bolivia and other Latin American and Caribbean nations. Clinton deserves high praise for acknowledging that the United States bears "shared responsibility" for the drug-fueled violence sweeping Mexico, which has claimed more than 7,000 lives since the beginning of 2008. But that means we will also share responsibility for the next 7,000 killings as well.
Our long-running "war on drugs," focusing on the supply side of the equation, has been an utter disaster. Domestically, we've locked up hundreds of thousands of street-level dealers, some of whom genuinely deserve to be in prison and some of whom don't. It made no difference. According to a 2007 University of Michigan study, 84 percent of high school seniors nationwide said they could obtain marijuana "fairly easily" or "very easily." The figure for amphetamines was 50 percent; for cocaine, 47 percent; for heroin, 30 percent.
At the same time, we've persisted in a Sisyphean attempt to cut off the drug supply at or near the source. When I was The Washington Post's correspondent in South America, I once took a nerve-racking helicopter ride to visit a U.S.-funded military base in the Upper Huallaga Valley of Peru. It was the place where most of the country's coca -- the plant from which cocaine is processed -- was being grown, and the valley was crawling with Maoist guerrillas who funded their insurgency with money they extorted from the coca growers and traffickers. Eventually, the coca business was eliminated in the Upper Huallaga. But now it's flourishing in other parts of Peru, and last year authorities there seized a record 30 tons of cocaine -- meaning, by rule of thumb, that at least 10 times that much was probably produced and shipped.
In Colombia, I saw how the huge, brutally violent Medellin and Cali cocaine cartels threatened to turn the country into the world's first "narco-state." The Colombian government, again with U.S. assistance, managed to pulverize these sprawling criminal organizations into smaller units, but the business continues to thrive -- and to provide most of the cocaine that finds its way to the American market. Last year, Colombian authorities seized 119 tons of cocaine. Money from the drug trade sustains the longest-running leftist insurgency in the hemisphere. Ever inventive, the Colombian traffickers have gone so far as to build their own miniature submarines to smuggle illicit cargo into the United States.
And now Mexico has become the focal point of the drug trade, with its cartels blasting their way to dominance in the business of bringing marijuana, methamphetamine, cocaine and other drugs to the American market. Violence among drug gangs, not just along the border but throughout the country, has reached crisis levels. The government's strategy is to break up the big cartels, as the Colombians did. But even if authorities succeed, the industry will live on.
In the case of Mexico, there's a complicating factor: This is a two-way problem. While drugs are being moved north across the border, powerful assault weapons -- purchased in the United States -- are being moved south to arm the cartels' foot soldiers. Clinton's statement about "shared responsibility" recognizes that if we expect Mexico to do something about the flow of drugs, we're obliged to do something about the counterflow of guns.
First, though, let's be honest with ourselves. This whole disruptive, destabilizing enterprise has one purpose, which is to supply the U.S. market with illegal drugs. As long as the demand exists, entrepreneurs will find a way to meet it. The obvious demand-side solution -- legalization -- would do more harm than good with some drugs, but maybe not with others. We need to examine all options. It's time to put everything on the table, because all we've accomplished so far is to bring the terrible violence of the drug trade ever closer to home.
eugenerobinson@washpost.com
Clinton Says U.S. Feeds Mexico Drug Trade
By MARK LANDLER
Copyright by The New York Times
Published: March 25, 2009
http://www.nytimes.com/2009/03/26/world/americas/26mexico.html?scp=1&sq=hillary%20clinton%20mexico%20drug&st=cse
MEXICO CITY — Seeking to ease a cross-border relationship strained by drug trafficking, Secretary of State Hillary Rodham Clinton arrived here Wednesday and offered the clearest acknowledgment yet from an Obama administration official of the role the United States plays in the violent narcotics trade in Mexico.
“Our insatiable demand for illegal drugs fuels the drug trade,” Mrs. Clinton said, using unusually blunt language. “Our inability to prevent weapons from being illegally smuggled across the border to arm these criminals causes the deaths of police officers, soldiers and civilians.”
Mrs. Clinton’s remarks were coupled with a pledge that the administration would seek $80 million from Congress to provide Mexican authorities with three Black Hawk helicopters to help the police track drug runners.
She also came bearing a new White House initiative, announced Tuesday, to deploy 450 more law enforcement officers at the border, and crack down on the smuggling of guns and drug money into Mexico.
The diplomatic offensive, which will include visits by several other senior American officials ahead of President Obama’s visit next month, was calculated to mollify Mexican officials, who have chafed in recent years at what they regard as Mexico-bashing in Washington. It seems to have worked.
Patricia Espinosa, Mexico’s foreign secretary, said the new measures were “much along the line of cooperation that we have been trying to build upon.” But, she added, “there is always room for improvement in the U.S.”
Indeed, some of the Obama administration’s measures are likely to run squarely into American political realities. For example, early indications that Mr. Obama will push for stricter controls on the sale of assault rifles have already set off an outcry among gun-control opponents.
“Politically, this is a very big hurdle in our Congress,” Mrs. Clinton conceded.
Since last year, battles between law enforcement authorities and cartels, and other drug-related violence, have resulted in more than 7,200 deaths in Mexico, raising doubts about the government’s control over parts of its territory. The violence has also begun to spill across the border.
Mrs. Clinton met with the President Felipe Calderón and praised his campaign to root out corruption in the police force and the courts. She said Mr. Obama had not decided whether to post National Guard troops along the border, an issue that has aroused opposition in Mexico.
On Wednesday, the Mexican Army said it had arrested one of the country’s most-wanted drug smugglers, Héctor Huerta, near Monterrey, the northern city Mrs. Clinton will visit Thursday.
Mrs. Clinton said that in addition to sending the helicopters, the United States would help supply Mexican law enforcement officers with night-vision goggles, body armor and other equipment to battle the cartels, which are heavily armed.
“We’ve got to figure out how to stop these bad guys,” she said. “These criminals are outgunning the law enforcement officials.”
Drugs are not the only issue vexing relations between the United States and Mexico. Congress recently canceled funds for a pilot program to allow Mexican trucks to haul cargo on American highways. Mexico retaliated by imposing $2.4 billion in tariffs on 89 American exports.
Mexican officials complain about mixed signals from the United States, noting that even as the administration steps up law enforcement help on the border, Congress has cut back funds for a three-year, $1.4 billion drug countertrafficking campaign called the Merida Initiative.
Even small slights rankle. When Forbes magazine put the Mexican drug lord Joaquín Guzmán, known as El Chapo, on its list of the world’s richest people, it elicited more attention, and offense, in Mexico than when Mr. Obama acknowledged that the drug trade was a two-way street.
“There have been lots of different voices from the Obama administration,” said Andrew Selee, director of the Mexico Institute at the Woodrow Wilson International Center for Scholars. “Hillary Clinton’s mission is to make sure there is a single voice.”
Mrs. Clinton said the administration was retooling the truck program to get it through Congress, and she expressed optimism that lawmakers were receptive but did not give details.
She defended the decision of Congress to withhold funds for the Merida Initiative, saying the lawmakers were watching to see that the $700 million already spent was being used wisely. The administration, she said, was weighing whether to ask for more money for the program.
The agreement between the nations was most vivid in comments by Ms. Espinosa and Mrs. Clinton on the need to crack down on gun smuggling. In December, Ms. Espinosa stood by as Condoleezza Rice, then the secretary of state, denied a link between the expiration of an assault weapons ban and drug violence.
“It is shocking to hear an American politician admit there is an issue,” said Denise Dresser, a prominent Mexican commentator and political scientist.
There were echoes of the presidential candidate in Mrs. Clinton’s discussion of America’s fitful war on drugs. She mentioned many failed efforts, going back to the “Just Say No” campaign.
“Clearly what we have been doing has not worked,” she said.
Marc Lacey contributed reporting.
Clinton: U.S. Drug Policies Failed, Fueled Mexico's Drug War
By Mary Beth Sheridan
Copyright by The Washington Post
Wednesday, March 25, 2009; 2:51 PM
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/25/AR2009032501034.html?hpid=topnews
MEXICO CITY, March 25 -- Secretary of State Hillary Rodham Clinton traveled to Mexico on Wednesday with a stark mea culpa, saying that decades of U.S. anti-narcotics policies had been a failure and contributed to the explosion of drug violence south of the border.
"Clearly what we've been doing has not worked," Clinton told reporters on her plane at the start of her two-day trip. "It is unfair for our incapacity to have effective policies" on curbing drug use, narcotics shipments and the flow of guns "to be creating a situation where people are holding the Mexican government and people responsible. That's not right."
Clinton's comments appeared to be the most sweeping yet by a top Obama administration official accepting a U.S. role in the drug havoc in Mexico. More than 7,000 Mexicans have been killed since January 2008, as cartels have warred over trafficking routes and lashed out at the government for deploying the military against them.
Mexican officials have long complained that the U.S. government pointed the finger at its neighbor while ignoring how American demand for cocaine, marijuana, heroin and methamphetamines fueled the trade. Mexican authorities also blame some of the violence on the flow of American guns, which have been used in about 90 percent of the drug killings, according to both U.S. and Mexican officials.
Clinton's comments came at the start of a U.S. blitz to improve relations at a moment when Mexico is facing perhaps the greatest challenge to its stability in a century. The Obama administration announced Tuesday it was sending hundreds more agents and extra high-tech gear to the border to intercept weapons and drug proceeds heading south. U.S. border states have become alarmed about a possible spillover of the drug violence, and Congress has held a flurry of hearings on the bloodshed and the potential threat to Mexico's institutions.
Clinton signaled that the U.S. government planned to do more. She vowed to press for swift delivery of equipment promised under the Merida Initiative, a three-year, $1.4 billion package of anti-drug assistance to Mexico and Central America. Mexican officials and U.S. lawmakers say there are long lag times for helicopters and other gear that are desperately needed. In addition, Congress has approved only $700 million of the $950 million that the Bush administration requested for the program since it began last year.
Clinton also the administration would "try to get more tools to go after the gun dealers" and those who purchase weapons to pass on to the cartels. She did not elaborate. Several U.S. lawmakers have already balked at the idea of cracking down on guns on the American side of the border, and the idea could face an uphill battle in Congress.
Mexican officials, historically sensitive to criticism from their richer, more powerful neighbor, have bristled at conclusions in U.S. military reports and in hearings recently that their government was losing control over parts of the country. President Felipe Calderón has described such statements as part of a "campaign" against his country.
Seeking to heal the strain, Clinton went out of her way to accept U.S. responsibility for the problem. She said drug demand in the United States remained "insatiable," blaming a lack of treatment facilities and insufficient campaigns to discourage narcotics abuse. American drug abusers provide Mexican traffickers with an estimated $15 to 25 billion a year.
"Neither interdiction [of drugs] nor reducing demand have been successful," Clinton said, noting that "we have been pursuing these strategies for 30 years."
"We've got to take a hard look at what we can do" to cut off the supply of drugs and "stop the bad guys," the secretary added. "The amount of violence going on because of these drug wars in Mexico is horrific."
Clinton's assessment appeared to be at odds with some conclusions by U.S. anti-drug officials. The Drug Enforcement Agency says that traffickers have had an increasingly hard time getting their shipments over the U.S. border, resulting in higher prices and lower purity for cocaine on American streets.
Michael Braun, who recently retired as a senior DEA official, told a congressional hearing this month that the U.S. military and law-enforcement agencies had dealt significant blows to traffickers' transportation networks.
"The seizure rates are off the charts for the last three or four years," he said. One of the reasons for the escalating violence in Mexico, he said, was the effectiveness of the U.S. operations against traffickers' transportation and financial infrastructure.
U.S. authorities, including Clinton, have lauded Calderón for dispatching 45,000 troops to battle the cartels.
While emphasizing the U.S. desire to cooperate on drugs, Clinton said she wanted her trip to also illustrate the broad range of issues the two countries cooperate on routinely, ranging from trade to education to the environment.
"The relationship we have with Mexico is much broader and deeper" than the drug issue, she said.
Clinton is planning to travel Thursday to Monterrey, Mexico's business capital, before heading back to Washington. Homeland Security Secretary Janet Napolitano and Attorney General Eric H. Holder Jr. are also scheduled to visit Mexico before Obama arrives in mid-April.
New York Times Editorial: Broader Access to Morning-After Pills
New York Times Editorial: Broader Access to Morning-After Pills
Copyright by The New York Times
Published: March 24, 2009
http://www.nytimes.com/2009/03/25/opinion/25wed2.html?ref=opinion
A federal judge in New York has added his weight to contentions that the Bush administration delayed easy, nonprescription access to the morning-after pill for political and ideological reasons, not from a desire to protect the public’s health. Judge Edward R. Korman wisely ordered the Food and Drug Administration to make the pill available without prescription to women as young as 17 and to consider approving it for girls of any age, as major medical groups have long advocated.
The morning-after pill, actually two pills taken in sequence, can block a pregnancy if taken soon after intercourse. It works best if taken within 24 hours but is effective up to 72 hours after intercourse. Prompt access is imperative; any delay in reaching a doctor to get a prescription can render the drug useless.
Judge Korman lays out in detail the continuous efforts by the Bush administration to prevent easy access to the pill by requiring a prescription, contrary to prevailing medical opinion. The World Health Organization and a slew of American health groups had urged that the pill be made available without prescription and without age restrictions, and virtually all major industrialized nations did so years ago. The drug has no serious long-term side effects, just mild short-term effects like nausea or abdominal pain in some users. The health benefits of preventing unplanned pregnancies or abortions far outweigh any likely downside.
Yet the Bush administration, through the Food and Drug Administration, found excuse after excuse for delaying a decision and narrowing its ultimate scope, presumably to placate Mr. Bush’s base of social and religious conservatives. At various stages, the agency’s leadership, sometimes after consulting the White House, dictated decisions that ran counter to what its scientists and advisory groups were recommending. It was only after the Senate threatened to hold up confirmation of a new F.D.A. commissioner in 2006 that the agency finally approved sales without prescription to women 18 and over, provided the drugs were kept behind the counter.
We called that decision “an acceptable compromise” because it finally made the drug more accessible. But Judge Korman notes that there is “overwhelming evidence” in F.D.A. files that 17-year-olds can use the drug safely without medical supervision.
The harder question is whether to remove all age and other restrictions, potentially allowing children as young as 11 or 12 to take the drug without medical supervision. The judge sensibly left that issue to the F.D.A., which can presumably be trusted to make a fair assessment now that it will be under new leadership.
Copyright by The New York Times
Published: March 24, 2009
http://www.nytimes.com/2009/03/25/opinion/25wed2.html?ref=opinion
A federal judge in New York has added his weight to contentions that the Bush administration delayed easy, nonprescription access to the morning-after pill for political and ideological reasons, not from a desire to protect the public’s health. Judge Edward R. Korman wisely ordered the Food and Drug Administration to make the pill available without prescription to women as young as 17 and to consider approving it for girls of any age, as major medical groups have long advocated.
The morning-after pill, actually two pills taken in sequence, can block a pregnancy if taken soon after intercourse. It works best if taken within 24 hours but is effective up to 72 hours after intercourse. Prompt access is imperative; any delay in reaching a doctor to get a prescription can render the drug useless.
Judge Korman lays out in detail the continuous efforts by the Bush administration to prevent easy access to the pill by requiring a prescription, contrary to prevailing medical opinion. The World Health Organization and a slew of American health groups had urged that the pill be made available without prescription and without age restrictions, and virtually all major industrialized nations did so years ago. The drug has no serious long-term side effects, just mild short-term effects like nausea or abdominal pain in some users. The health benefits of preventing unplanned pregnancies or abortions far outweigh any likely downside.
Yet the Bush administration, through the Food and Drug Administration, found excuse after excuse for delaying a decision and narrowing its ultimate scope, presumably to placate Mr. Bush’s base of social and religious conservatives. At various stages, the agency’s leadership, sometimes after consulting the White House, dictated decisions that ran counter to what its scientists and advisory groups were recommending. It was only after the Senate threatened to hold up confirmation of a new F.D.A. commissioner in 2006 that the agency finally approved sales without prescription to women 18 and over, provided the drugs were kept behind the counter.
We called that decision “an acceptable compromise” because it finally made the drug more accessible. But Judge Korman notes that there is “overwhelming evidence” in F.D.A. files that 17-year-olds can use the drug safely without medical supervision.
The harder question is whether to remove all age and other restrictions, potentially allowing children as young as 11 or 12 to take the drug without medical supervision. The judge sensibly left that issue to the F.D.A., which can presumably be trusted to make a fair assessment now that it will be under new leadership.
Afghan Strikes by Taliban Get Pakistan Help, U.S. Aides Say
Afghan Strikes by Taliban Get Pakistan Help, U.S. Aides Say
By MARK MAZZETTI and ERIC SCHMITT
Copyright by The New York Times
Published: March 25, 2009
http://www.nytimes.com/2009/03/26/world/asia/26tribal.html?_r=1&hp
WASHINGTON — The Taliban’s widening campaign in southern Afghanistan is made possible in part by direct support from operatives in Pakistan’s military intelligence agency, despite Pakistani government promises to sever ties to militant groups fighting in Afghanistan, according to American government officials.
The support consists of money, military supplies and strategic planning guidance to Taliban commanders who are gearing up to confront the international force in Afghanistan that will soon include some 17,000 American reinforcements.
Support for the Taliban, as well as other militant groups, is coordinated by operatives inside the shadowy S Wing of Pakistan’s spy service, the Directorate for Inter-Services Intelligence, the officials said. There is even evidence that ISI operatives meet regularly with Taliban commanders to discuss whether to intensify or scale back violence before the Afghan elections.
Details of the ISI’s continuing ties to militant groups were described by a half-dozen American, Pakistani and other security officials during recent interviews in Washington and the Pakistani capital, Islamabad. All requested anonymity because they were discussing classified and sensitive intelligence information.
The American officials said proof of the ties between the Taliban and Pakistani spies came from electronic surveillance and trusted informants. The Pakistani officials interviewed said that they had firsthand knowledge of the connections, though they denied that the ties were strengthening the insurgency.
American officials have complained for more than a year about the ISI’s support to groups like the Taliban. But the new details reveal that the spy agency is aiding a broader array of militant networks with more diverse types of support than was previously known — even months after Pakistani officials said that the days of the ISI’s playing a “double game” had ended.
Pakistan’s military and civilian leaders publicly deny any government ties to militant groups, and American officials say it is unlikely that top officials in Islamabad are directly coordinating the clandestine efforts. American officials have also said that midlevel ISI operatives occasionally cultivate relationships that are not approved by their bosses.
In a sign of just how resigned Western officials are to the ties, the British government has sent several dispatches to Islamabad in recent months asking that the ISI use its strategy meetings with the Taliban to persuade its commanders to scale back violence in Afghanistan before the August presidential election there, according to one official.
But the inability, or unwillingness, of the embattled civilian government, led by President Asif Ali Zardari, to break the ties that bind the ISI to the militants illustrates the complexities of a region of shifting alliances. Obama administration officials admit that they are struggling to understand these allegiances as they try to forge a strategy to quell violence in Afghanistan, which has intensified because of a resurgent Taliban. Fighting this insurgency is difficult enough, officials said, without having to worry about an allied spy service’s supporting the enemy.
But the Pakistanis offered a more nuanced portrait. They said the contacts were less threatening than the American officials depicted and were part of a strategy to maintain influence in Afghanistan for the day when American forces would withdraw and leave what they fear could be a power vacuum to be filled by India, Pakistan’s archenemy. A senior Pakistani military officer said, “In intelligence, you have to be in contact with your enemy or you are running blind.”
The ISI helped create and nurture the Taliban movement in the 1990s to bring stability to a nation that had been devastated by years of civil war between rival warlords, and one Pakistani official explained that Islamabad needed to use groups like the Taliban as “proxy forces to preserve our interests.”
A spokesman at the Pakistani Embassy in Washington declined to comment for this article.
Over the past year, a parade of senior American diplomats, military officers and intelligence officials have flown to Islamabad to urge Pakistan’s civilian and military leaders to cut off support for militant groups, and Washington has threatened to put conditions on more than $1 billion in annual military aid to Pakistan. On Saturday, the director of the C.I.A., Leon E. Panetta, met with top Pakistani officials in Islamabad.
Little is publicly known about the ISI’s S Wing, which officials say directs intelligence operations outside of Pakistan. American officials said that the S Wing provided direct support to three major groups carrying out attacks in Afghanistan: the Taliban based in Quetta, Pakistan, commanded by Mullah Muhammad Omar; the militant network run by Gulbuddin Hekmatyar; and a different group run by the guerrilla leader Jalaluddin Haqqani.
Dennis C. Blair, the director of national intelligence, recently told senators that the Pakistanis “draw distinctions” among different militant groups.
“There are some they believe have to be hit and that we should cooperate on hitting, and there are others they think don’t constitute as much of a threat to them and that they think are best left alone,” Mr. Blair said.
The Haqqani network, which focuses its attacks on Afghanistan, is considered a strategic asset to Pakistan, according to American and Pakistani officials, in contrast to the militant network run by Baitullah Mehsud, which has the goal of overthrowing Pakistan’s government.
Top American officials speak bluntly about how the situation has changed little since last summer, when evidence showed that ISI operatives helped plan the bombing of the Indian Embassy in Kabul, an attack that killed 54 people.
“They have been very attached to many of these extremist organizations, and it’s my belief that in the long run, they have got to completely cut ties with those in order to really move in the right direction,” Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, said recently on “The Charlie Rose Show” on PBS.
The Taliban has been able to finance a military campaign inside Afghanistan largely through proceeds from the illegal drug trade and wealthy individuals from the Persian Gulf. But American officials said that when fighters needed fuel or ammunition to sustain their attacks against American troops, they would often turn to the ISI.
When the groups needed to replenish their ranks, it would be operatives from the S Wing who often slipped into radical madrasas across Pakistan to drum up recruits, the officials said.
The ISI support for militants extends beyond those operating in the tribal areas of northwest Pakistan. American officials said the spy agency had also shared intelligence with Lashkar-e-Taiba, the Pakistan-based militant group suspected of conducting the Mumbai attacks, and provided protection for it.
Mr. Zardari took steps last summer to purge the ISI’s top ranks after the United States confronted Pakistan with evidence about the Indian Embassy bombing. Mr. Zardari pledged that the ISI would be “handled,” and that anyone working with militants would be dismissed.
Yet with the future of Mr. Zardari’s government uncertain in the current political turmoil and with Obama officials seeing few immediate alternatives, American officials and outside experts said that Pakistan’s military establishment appears to see little advantage in responding to the demands of civilian officials in Islamabad or Washington.
As a result, when the Haqqani fighters need to stay a step ahead of American forces stalking them on the ground and in the air, they rely on moles within the spy agency to tip them off to allied missions planned against them, American military officials said.
Mark Mazzetti reported from Washington, and Eric Schmitt from Washington and Islamabad, Pakistan.
By MARK MAZZETTI and ERIC SCHMITT
Copyright by The New York Times
Published: March 25, 2009
http://www.nytimes.com/2009/03/26/world/asia/26tribal.html?_r=1&hp
WASHINGTON — The Taliban’s widening campaign in southern Afghanistan is made possible in part by direct support from operatives in Pakistan’s military intelligence agency, despite Pakistani government promises to sever ties to militant groups fighting in Afghanistan, according to American government officials.
The support consists of money, military supplies and strategic planning guidance to Taliban commanders who are gearing up to confront the international force in Afghanistan that will soon include some 17,000 American reinforcements.
Support for the Taliban, as well as other militant groups, is coordinated by operatives inside the shadowy S Wing of Pakistan’s spy service, the Directorate for Inter-Services Intelligence, the officials said. There is even evidence that ISI operatives meet regularly with Taliban commanders to discuss whether to intensify or scale back violence before the Afghan elections.
Details of the ISI’s continuing ties to militant groups were described by a half-dozen American, Pakistani and other security officials during recent interviews in Washington and the Pakistani capital, Islamabad. All requested anonymity because they were discussing classified and sensitive intelligence information.
The American officials said proof of the ties between the Taliban and Pakistani spies came from electronic surveillance and trusted informants. The Pakistani officials interviewed said that they had firsthand knowledge of the connections, though they denied that the ties were strengthening the insurgency.
American officials have complained for more than a year about the ISI’s support to groups like the Taliban. But the new details reveal that the spy agency is aiding a broader array of militant networks with more diverse types of support than was previously known — even months after Pakistani officials said that the days of the ISI’s playing a “double game” had ended.
Pakistan’s military and civilian leaders publicly deny any government ties to militant groups, and American officials say it is unlikely that top officials in Islamabad are directly coordinating the clandestine efforts. American officials have also said that midlevel ISI operatives occasionally cultivate relationships that are not approved by their bosses.
In a sign of just how resigned Western officials are to the ties, the British government has sent several dispatches to Islamabad in recent months asking that the ISI use its strategy meetings with the Taliban to persuade its commanders to scale back violence in Afghanistan before the August presidential election there, according to one official.
But the inability, or unwillingness, of the embattled civilian government, led by President Asif Ali Zardari, to break the ties that bind the ISI to the militants illustrates the complexities of a region of shifting alliances. Obama administration officials admit that they are struggling to understand these allegiances as they try to forge a strategy to quell violence in Afghanistan, which has intensified because of a resurgent Taliban. Fighting this insurgency is difficult enough, officials said, without having to worry about an allied spy service’s supporting the enemy.
But the Pakistanis offered a more nuanced portrait. They said the contacts were less threatening than the American officials depicted and were part of a strategy to maintain influence in Afghanistan for the day when American forces would withdraw and leave what they fear could be a power vacuum to be filled by India, Pakistan’s archenemy. A senior Pakistani military officer said, “In intelligence, you have to be in contact with your enemy or you are running blind.”
The ISI helped create and nurture the Taliban movement in the 1990s to bring stability to a nation that had been devastated by years of civil war between rival warlords, and one Pakistani official explained that Islamabad needed to use groups like the Taliban as “proxy forces to preserve our interests.”
A spokesman at the Pakistani Embassy in Washington declined to comment for this article.
Over the past year, a parade of senior American diplomats, military officers and intelligence officials have flown to Islamabad to urge Pakistan’s civilian and military leaders to cut off support for militant groups, and Washington has threatened to put conditions on more than $1 billion in annual military aid to Pakistan. On Saturday, the director of the C.I.A., Leon E. Panetta, met with top Pakistani officials in Islamabad.
Little is publicly known about the ISI’s S Wing, which officials say directs intelligence operations outside of Pakistan. American officials said that the S Wing provided direct support to three major groups carrying out attacks in Afghanistan: the Taliban based in Quetta, Pakistan, commanded by Mullah Muhammad Omar; the militant network run by Gulbuddin Hekmatyar; and a different group run by the guerrilla leader Jalaluddin Haqqani.
Dennis C. Blair, the director of national intelligence, recently told senators that the Pakistanis “draw distinctions” among different militant groups.
“There are some they believe have to be hit and that we should cooperate on hitting, and there are others they think don’t constitute as much of a threat to them and that they think are best left alone,” Mr. Blair said.
The Haqqani network, which focuses its attacks on Afghanistan, is considered a strategic asset to Pakistan, according to American and Pakistani officials, in contrast to the militant network run by Baitullah Mehsud, which has the goal of overthrowing Pakistan’s government.
Top American officials speak bluntly about how the situation has changed little since last summer, when evidence showed that ISI operatives helped plan the bombing of the Indian Embassy in Kabul, an attack that killed 54 people.
“They have been very attached to many of these extremist organizations, and it’s my belief that in the long run, they have got to completely cut ties with those in order to really move in the right direction,” Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, said recently on “The Charlie Rose Show” on PBS.
The Taliban has been able to finance a military campaign inside Afghanistan largely through proceeds from the illegal drug trade and wealthy individuals from the Persian Gulf. But American officials said that when fighters needed fuel or ammunition to sustain their attacks against American troops, they would often turn to the ISI.
When the groups needed to replenish their ranks, it would be operatives from the S Wing who often slipped into radical madrasas across Pakistan to drum up recruits, the officials said.
The ISI support for militants extends beyond those operating in the tribal areas of northwest Pakistan. American officials said the spy agency had also shared intelligence with Lashkar-e-Taiba, the Pakistan-based militant group suspected of conducting the Mumbai attacks, and provided protection for it.
Mr. Zardari took steps last summer to purge the ISI’s top ranks after the United States confronted Pakistan with evidence about the Indian Embassy bombing. Mr. Zardari pledged that the ISI would be “handled,” and that anyone working with militants would be dismissed.
Yet with the future of Mr. Zardari’s government uncertain in the current political turmoil and with Obama officials seeing few immediate alternatives, American officials and outside experts said that Pakistan’s military establishment appears to see little advantage in responding to the demands of civilian officials in Islamabad or Washington.
As a result, when the Haqqani fighters need to stay a step ahead of American forces stalking them on the ground and in the air, they rely on moles within the spy agency to tip them off to allied missions planned against them, American military officials said.
Mark Mazzetti reported from Washington, and Eric Schmitt from Washington and Islamabad, Pakistan.
US economy falls 6.3% in fourth quarter/Glimmers of hope for a feeble U.S. economy
US economy falls 6.3% in fourth quarter
By Alan Rappeport in New York
Copyright The Financial Times Limited 2009
Published: March 26 2009 13:12 | Last updated: March 26 2009 15:29
http://www.ft.com/cms/s/0/9a973c12-19fe-11de-9f91-0000779fd2ac.html
The US economy shrank in the fourth quarter at its fastest rate since 1982, revised official figures showed on Thursday, as corporate profits fell at the sharpest pace in 55 years and jobless claims continued to climb.
Updated commerce department data showed US gross domestic product contracting at an annualised rate of 6.3 per cent in the fourth quarter of last year, compared with last month’s estimate of 6.2 per cent. That previous 26-year record came after an overly optimistic January projection that the economy contracted by just 3.8 per cent in spite of anecdotal evidence of a more severe downturn.
The final GDP figures were expected to show a contraction of 6.6 per cent, but the results signal that a deeper contraction could be coming this quarter. The revision was due to a draw-down of inventories and a slowing of construction and exported services. The downgrade was blunted by reduced imports, an uptick in exported goods and an infusion of government spending.
A weakened US economy pulled corporate profits down by 16.5 per cent, or $250.3bn, in the fourth quarter of 2008 from the third, the biggest drop since a decline of 16.9 per cent in the same period of 1953. According to economists at Goldman Sachs 70 per cent of this decline was due to write downs of assets in the financial sector.
The decline in corporate profits also sapped government coffers, as taxes paid on corporate income fell by 33.1 per cent.
“All the incoming data suggest that the economy will contract by a staggering 7 to 8 per cent in the first quarter, before the economy begins to stabilise,” said Nariman Behravesh, chief economist at IHS Global Insight.
Economists predict that the impact of the $787bn government stimulus package will not be felt until the second half of this year and that the economy could contract by another 6 per cent in the second quarter before flattening. The US government’s 10-year budget outline unveiled last month projected that the economy would contract by 1.2 per cent in 2009 before rebounding to 3.2 per cent growth in 2010. The Congressional Budget Office, however, found those estimates to be exceedingly hopeful.
Separately on Thursday the labour department said that new jobless claims climbed by 8,000 last week after easing in the second week of March. Initial claims rose to 652,000 from a revised 644,000 the week before, disappointing consensus estimates of 650,000 new claims.
Meanwhile the number of people continuing to claim unemployment benefits through the second week of March rose by 122,000 to 5.56m, the highest total since tracking began in 1967.
The insured unemployment rate rose from 4.1 per cent to 4.2 per cent, the highest level since 1983, while the four-week average of weekly jobless claims fell back last week to 649,000, retreating from a 27-year high the week before.
“There is no sign of recovery here, and claims are usually one of the very first numbers to turn,” said Ian Sheperdson, chief US economist at High Frequency Economics.
In February the unemployment rate jumped from 7.6 per cent to 8.1 per cent, its highest level since 1983, as the number of jobs lost reached 651,000. Economists expect that another 700,000 jobs could be lost this month and that the official employment report next week could show the jobless rate reaching 8.5 per cent.
In spite of Thursday’s grim data, recent figures have shown signs that the US economy could be starting to stabilise.
On Wednesday the Mortgage Bankers Association said that applications for US mortgages surged last week as banks lowered borrowing costs after the Federal Reserve’s decision to buy Treasuries pushed interest rates to record lows. Sales of new homes rose for the first time in seven months in February as falling prices began to lure buyers to the market and companies have finally begun to increase spending on durable goods.
“The slight improvement in the data will not prevent another big contraction in first quarter real GDP,” Mr Behravesh said. “On the other hand the worst of the worst is probably behind us.”
Glimmers of hope for a feeble U.S. economy
By Jack Healy
Copyright by The International Herald Tribune
Published: March 25, 2009
http://www.iht.com/articles/2009/03/25/business/usecon.php
NEW YORK: During the worst economic downturn in a generation, some people in the United States are beginning to catch glimpses of an unfamiliar sight: causes for hope.
The banking system is still fraught, the U.S. economy is contracting sharply, and 600,000 jobs are vanishing every month. But other economic barometers have stabilized a bit and stock markets have surged about 20 percent during the past two weeks, kindling hopes among investors that the long-suffering economy might finally be searching for a bottom.
Two new reports from the housing market and manufacturing sector underscored those fragile wisps of optimism Wednesday.
Factory orders for goods like metals, machines and military equipment rose last month after six months of declines, the U.S. Commerce Department reported. Those orders increased 3.4 percent in February after a stark 7.3 decline a month earlier.
Orders for machinery, transportation equipment and computers and electronics were all higher than the month before. Economists had expected a 2.5 percent decline.
The Commerce Department also said Wednesday that sales of new single-family homes rose 4.7 percent in February, a welcome sign of life for the foundering U.S. housing market. Home builders have cut back significantly on new residential development as they struggle with lower demand, tighter credit and a flood of cheap foreclosure properties.
"You don't want to make a trend out of any one month," said Adam G. York, an economist at Wachovia Economics. "But we'll take the good news where we can get it, and here and there we're seeing some smatterings of less-bad economic data."'
Investors on Wall Street pushed stocks higher in morning trading, though the gains had faded by mid-afternoon, when the Dow Jones industrial average was off 76 points, or about 1 percent.
The economic data released Wednesday were the latest in a series of less-than-terrible reports that have offered a break from months of relentlessly bad economic news.
Earlier this week, an industry group reported that sales of previously owned homes rose 5 percent last month. The government reported Tuesday that its barometer of home prices rose in January after 10 months of decline.
Earlier this month, the government reported that consumer prices were stabilizing slightly, cooling fears of deflation and that retail sales in February had fallen by less than expected.
Economists caution that many of these monthly statistics are extremely volatile, and that a one-month increase does not represent anything resembling a turnaround. Even if the economy is beginning to bottom out after slipping into recession in December 2007, hitting a floor does not presage any return to growth.
"Is it possible the economy has bottomed? Absolutely," said Russ Koesterich, head of investment strategy at Barclays Global Investors. "Would it be reasonable or rational to expect a strong recovery? I don't think so."
Given the scale of the problems facing consumers, homeowners, the financial system and the U.S. government, analysts are expecting a tentative L-shaped recovery in stock markets and the broader economy, rather than a V-shaped rebound.
Also, economists say that the details of "better than expected" economic numbers provide little cause for celebration.
The bounce in durable-goods orders followed large downward revisions to January data. And even with the 3.4 percent gain in February, orders for durable goods were down 28.4 percent from a year earlier, the government said.
And economists said that forward-looking indexes of manufacturing activity are still bracing for months of further declines as businesses cut jobs and capital spending in an effort to survive the broad global downturn.
"The underlying state of industry is still deteriorating," Ian C. Shepherdson, chief U.S. economist at High Frequency Economics, wrote in a note to investors.
Still, some economists say that depressed industrial activity would probably pick up later this year and into 2010 as projects from the government's $787 billion stimulus package get under way.
"The February report on durable goods demand is the latest in a recent series of data releases which suggest that the recession-battered U.S. economy may be close to, or at, a business cycle bottom," Cliff Waldman, an economist for the Manufacturers Alliance, wrote in a note.
By Alan Rappeport in New York
Copyright The Financial Times Limited 2009
Published: March 26 2009 13:12 | Last updated: March 26 2009 15:29
http://www.ft.com/cms/s/0/9a973c12-19fe-11de-9f91-0000779fd2ac.html
The US economy shrank in the fourth quarter at its fastest rate since 1982, revised official figures showed on Thursday, as corporate profits fell at the sharpest pace in 55 years and jobless claims continued to climb.
Updated commerce department data showed US gross domestic product contracting at an annualised rate of 6.3 per cent in the fourth quarter of last year, compared with last month’s estimate of 6.2 per cent. That previous 26-year record came after an overly optimistic January projection that the economy contracted by just 3.8 per cent in spite of anecdotal evidence of a more severe downturn.
The final GDP figures were expected to show a contraction of 6.6 per cent, but the results signal that a deeper contraction could be coming this quarter. The revision was due to a draw-down of inventories and a slowing of construction and exported services. The downgrade was blunted by reduced imports, an uptick in exported goods and an infusion of government spending.
A weakened US economy pulled corporate profits down by 16.5 per cent, or $250.3bn, in the fourth quarter of 2008 from the third, the biggest drop since a decline of 16.9 per cent in the same period of 1953. According to economists at Goldman Sachs 70 per cent of this decline was due to write downs of assets in the financial sector.
The decline in corporate profits also sapped government coffers, as taxes paid on corporate income fell by 33.1 per cent.
“All the incoming data suggest that the economy will contract by a staggering 7 to 8 per cent in the first quarter, before the economy begins to stabilise,” said Nariman Behravesh, chief economist at IHS Global Insight.
Economists predict that the impact of the $787bn government stimulus package will not be felt until the second half of this year and that the economy could contract by another 6 per cent in the second quarter before flattening. The US government’s 10-year budget outline unveiled last month projected that the economy would contract by 1.2 per cent in 2009 before rebounding to 3.2 per cent growth in 2010. The Congressional Budget Office, however, found those estimates to be exceedingly hopeful.
Separately on Thursday the labour department said that new jobless claims climbed by 8,000 last week after easing in the second week of March. Initial claims rose to 652,000 from a revised 644,000 the week before, disappointing consensus estimates of 650,000 new claims.
Meanwhile the number of people continuing to claim unemployment benefits through the second week of March rose by 122,000 to 5.56m, the highest total since tracking began in 1967.
The insured unemployment rate rose from 4.1 per cent to 4.2 per cent, the highest level since 1983, while the four-week average of weekly jobless claims fell back last week to 649,000, retreating from a 27-year high the week before.
“There is no sign of recovery here, and claims are usually one of the very first numbers to turn,” said Ian Sheperdson, chief US economist at High Frequency Economics.
In February the unemployment rate jumped from 7.6 per cent to 8.1 per cent, its highest level since 1983, as the number of jobs lost reached 651,000. Economists expect that another 700,000 jobs could be lost this month and that the official employment report next week could show the jobless rate reaching 8.5 per cent.
In spite of Thursday’s grim data, recent figures have shown signs that the US economy could be starting to stabilise.
On Wednesday the Mortgage Bankers Association said that applications for US mortgages surged last week as banks lowered borrowing costs after the Federal Reserve’s decision to buy Treasuries pushed interest rates to record lows. Sales of new homes rose for the first time in seven months in February as falling prices began to lure buyers to the market and companies have finally begun to increase spending on durable goods.
“The slight improvement in the data will not prevent another big contraction in first quarter real GDP,” Mr Behravesh said. “On the other hand the worst of the worst is probably behind us.”
Glimmers of hope for a feeble U.S. economy
By Jack Healy
Copyright by The International Herald Tribune
Published: March 25, 2009
http://www.iht.com/articles/2009/03/25/business/usecon.php
NEW YORK: During the worst economic downturn in a generation, some people in the United States are beginning to catch glimpses of an unfamiliar sight: causes for hope.
The banking system is still fraught, the U.S. economy is contracting sharply, and 600,000 jobs are vanishing every month. But other economic barometers have stabilized a bit and stock markets have surged about 20 percent during the past two weeks, kindling hopes among investors that the long-suffering economy might finally be searching for a bottom.
Two new reports from the housing market and manufacturing sector underscored those fragile wisps of optimism Wednesday.
Factory orders for goods like metals, machines and military equipment rose last month after six months of declines, the U.S. Commerce Department reported. Those orders increased 3.4 percent in February after a stark 7.3 decline a month earlier.
Orders for machinery, transportation equipment and computers and electronics were all higher than the month before. Economists had expected a 2.5 percent decline.
The Commerce Department also said Wednesday that sales of new single-family homes rose 4.7 percent in February, a welcome sign of life for the foundering U.S. housing market. Home builders have cut back significantly on new residential development as they struggle with lower demand, tighter credit and a flood of cheap foreclosure properties.
"You don't want to make a trend out of any one month," said Adam G. York, an economist at Wachovia Economics. "But we'll take the good news where we can get it, and here and there we're seeing some smatterings of less-bad economic data."'
Investors on Wall Street pushed stocks higher in morning trading, though the gains had faded by mid-afternoon, when the Dow Jones industrial average was off 76 points, or about 1 percent.
The economic data released Wednesday were the latest in a series of less-than-terrible reports that have offered a break from months of relentlessly bad economic news.
Earlier this week, an industry group reported that sales of previously owned homes rose 5 percent last month. The government reported Tuesday that its barometer of home prices rose in January after 10 months of decline.
Earlier this month, the government reported that consumer prices were stabilizing slightly, cooling fears of deflation and that retail sales in February had fallen by less than expected.
Economists caution that many of these monthly statistics are extremely volatile, and that a one-month increase does not represent anything resembling a turnaround. Even if the economy is beginning to bottom out after slipping into recession in December 2007, hitting a floor does not presage any return to growth.
"Is it possible the economy has bottomed? Absolutely," said Russ Koesterich, head of investment strategy at Barclays Global Investors. "Would it be reasonable or rational to expect a strong recovery? I don't think so."
Given the scale of the problems facing consumers, homeowners, the financial system and the U.S. government, analysts are expecting a tentative L-shaped recovery in stock markets and the broader economy, rather than a V-shaped rebound.
Also, economists say that the details of "better than expected" economic numbers provide little cause for celebration.
The bounce in durable-goods orders followed large downward revisions to January data. And even with the 3.4 percent gain in February, orders for durable goods were down 28.4 percent from a year earlier, the government said.
And economists said that forward-looking indexes of manufacturing activity are still bracing for months of further declines as businesses cut jobs and capital spending in an effort to survive the broad global downturn.
"The underlying state of industry is still deteriorating," Ian C. Shepherdson, chief U.S. economist at High Frequency Economics, wrote in a note to investors.
Still, some economists say that depressed industrial activity would probably pick up later this year and into 2010 as projects from the government's $787 billion stimulus package get under way.
"The February report on durable goods demand is the latest in a recent series of data releases which suggest that the recession-battered U.S. economy may be close to, or at, a business cycle bottom," Cliff Waldman, an economist for the Manufacturers Alliance, wrote in a note.
BofA plans swift payback of Tarp funds
BofA plans swift payback of Tarp funds
By Greg Farrell and Saskia Scholtes in New York
Copyright The Financial Times Limited 2009
Published: March 25 2009 21:01 | Last updated: March 26 2009 00:09
http://www.ft.com/cms/s/0/989391c4-197a-11de-9d34-0000779fd2ac.html
Bank of America has added its name to the growing list of major US banks that are seeking to pay back as soon as possible the funds borrowed under the government’s bank recapitalisation scheme.
Ken Lewis, BofA chief executive, said in an interview published on Wednesday that he hoped to start paying back $45bn in taxpayer funds in late April, after the results from the Treasury Department’s first round of “stress tests” are issued. The tests are designed to separate strong banks from the weak.
If the capital markets continued to improve, he added, BofA wanted to repay the entire $45bn by the end of 2009.
Mr Lewis’ pledge, in an interview with the Los Angeles Times, to pay back the money from the troubled asset relief programme as soon as possible came on the same day as Goldman Sachs confirmed that it planned to pay its entire $10bn Tarp stake back, possibly by the end of April, following the disclosure of “stress test” results.
While the major US Tarp recipients have said they plan to pay back the funds as soon as possible, populist outrage in Washington against bankers – which manifested itself last week in a proposal to tax bonuses of Tarp recipients at 90 per cent – seems to have crystallised the notion among US bankers that the sooner they divest themselves of government funding the better.
Northern Trust, a custody bank specialising in asset management for institutions and wealthy private clients, has also pledged to pay back its Tarp money as soon as possible. The bank attracted public ridicule last month for its sponsorship of a golf tournament in southern California, the Northern Trust Open, which featured VIP treatment of its guests.
“Right now, there’s going to be a race to see who can pay back Tarp fastest,” said Carole Browner of Luna Analytics. “There are too many stipulations on what banks can and can’t do if they have received Tarp money”.
But whether banks such as BofA can afford to pay their Tarp money back is another matter, says Richard Staite of Atlantic Equities. “It’s clear that regulators in the US and globally want banks to significantly strengthen their capital ratios at this point, and paying back Tarp at the end of April would be contrary to efforts to stabilise the financial system”, he says.
Given that BofA is still trying to digest two major acquisitions that saddled the group with bad assets – Countrywide Financial and Merrill Lynch – Mr Staite doesn’t think BofA should be in any rush to get out of the Tarp programme.
Separately, Moody’s Investors Service cut the credit ratings of Bank of America and Wells Fargo on Wednesday, including slashing ratings on their preferred stock to junk, citing concerns the banks’ capital ratios would remain under pressure, increasing the likelihood that further government support would be needed.
BofA’s pledge to pay back Tarp funds comes as a group of US and European pension funds sought to consolidate 11 shareholder lawsuits into one class action against BofA for not warning investors about the depths of Merrill Lynch’s problems prior to the December 5 shareholder vote.
By Greg Farrell and Saskia Scholtes in New York
Copyright The Financial Times Limited 2009
Published: March 25 2009 21:01 | Last updated: March 26 2009 00:09
http://www.ft.com/cms/s/0/989391c4-197a-11de-9d34-0000779fd2ac.html
Bank of America has added its name to the growing list of major US banks that are seeking to pay back as soon as possible the funds borrowed under the government’s bank recapitalisation scheme.
Ken Lewis, BofA chief executive, said in an interview published on Wednesday that he hoped to start paying back $45bn in taxpayer funds in late April, after the results from the Treasury Department’s first round of “stress tests” are issued. The tests are designed to separate strong banks from the weak.
If the capital markets continued to improve, he added, BofA wanted to repay the entire $45bn by the end of 2009.
Mr Lewis’ pledge, in an interview with the Los Angeles Times, to pay back the money from the troubled asset relief programme as soon as possible came on the same day as Goldman Sachs confirmed that it planned to pay its entire $10bn Tarp stake back, possibly by the end of April, following the disclosure of “stress test” results.
While the major US Tarp recipients have said they plan to pay back the funds as soon as possible, populist outrage in Washington against bankers – which manifested itself last week in a proposal to tax bonuses of Tarp recipients at 90 per cent – seems to have crystallised the notion among US bankers that the sooner they divest themselves of government funding the better.
Northern Trust, a custody bank specialising in asset management for institutions and wealthy private clients, has also pledged to pay back its Tarp money as soon as possible. The bank attracted public ridicule last month for its sponsorship of a golf tournament in southern California, the Northern Trust Open, which featured VIP treatment of its guests.
“Right now, there’s going to be a race to see who can pay back Tarp fastest,” said Carole Browner of Luna Analytics. “There are too many stipulations on what banks can and can’t do if they have received Tarp money”.
But whether banks such as BofA can afford to pay their Tarp money back is another matter, says Richard Staite of Atlantic Equities. “It’s clear that regulators in the US and globally want banks to significantly strengthen their capital ratios at this point, and paying back Tarp at the end of April would be contrary to efforts to stabilise the financial system”, he says.
Given that BofA is still trying to digest two major acquisitions that saddled the group with bad assets – Countrywide Financial and Merrill Lynch – Mr Staite doesn’t think BofA should be in any rush to get out of the Tarp programme.
Separately, Moody’s Investors Service cut the credit ratings of Bank of America and Wells Fargo on Wednesday, including slashing ratings on their preferred stock to junk, citing concerns the banks’ capital ratios would remain under pressure, increasing the likelihood that further government support would be needed.
BofA’s pledge to pay back Tarp funds comes as a group of US and European pension funds sought to consolidate 11 shareholder lawsuits into one class action against BofA for not warning investors about the depths of Merrill Lynch’s problems prior to the December 5 shareholder vote.
I.R.S. to offer deal to offshore tax evaders/US retail investors flee to savings
I.R.S. to offer deal to offshore tax evaders
By Lynnley Browning
Copyright by tHe International Herald Tribune
Published: March 26, 2009
http://www.iht.com/articles/2009/03/26/business/27tax.php
The Internal Revenue Service, under pressure to bring in money to the faltering economy, plans to give offshore tax evaders a big break.
The agency has drafted a plan that significantly lowers a penalty that applies to wealthy Americans who hide money overseas in secret accounts, a person briefed on the matter said Thursday. The plan is intended to lure out of hiding scores of wealthy people who must come forward and declare their accounts in order to take advantage of the lower penalty.
The plan was developed amid a widening investigation into wealthy American clients of UBS but will apply to clients of other banks as well.
Under the plan, according to the person briefed on the issue, the I.R.S. will cut an onerous penalty for not filing a Report of Foreign Bank and Financial Account, known as an Fbar — something offshore tax evaders have not done.
The current penalty is 50 percent of the high balance of each account over the last three years — an amount that can wipe out an investor's accounts in just two years — but the I.R.S. will reduce that penalty to 5 percent to 20 percent, depending in part on whether the wealth was inherited.
The I.R.S. will also require taxpayers to pay any taxes and interest owed over the last six years, as well as assess a standard, accuracy-related penalty of 20 percent. Taxpayers must also file amended returns for the last six years.
The proposal, which the I.R.S. is communicating to its field agents who audit returns, does not allow taxpayers to escape potential prosecution, but it makes that outcome less likely, in particular for those covered under the 5 percent Fbar penalty, this person said.
"They need to get money back into the system, so they needed to sweeten the deal," the person said.
An I.R.S. spokesman declined to comment.
The plan comes after the I.R.S. last November scrapped a last-minute proposal to create a global settlement for taxpayers with offshore accounts. Such settlements in the past have come under criticism for not attracting enough tax evaders.
The new plan may be more likely to draw in tax evaders because the I.R.S. and the Justice Department are exerting significant legal pressure on UBS, the world's largest private bank, to disclose 52,000 client names. Unless those clients come forward before their names are potentially turned over, they can face a heightened risk of being prosecuted, as well as the steeper Fbar penalties.
US retail investors flee to savings
By Deborah Brewster in New York
Copyright The Financial Times Limited 2009
Published: March 25 2009 23:37 | Last updated: March 25 2009 23:37
http://www.ft.com/cms/s/0/182e200a-1973-11de-9d34-0000779fd2ac.html
US retail investors poured close to $250bn (€184bn) into bank accounts in the first months of this year, sharply accelerating a flight to safety as they continued to flee volatile stock markets.
Bank savings deposits rose by $246bn to a record $4,343bn in the nine weeks to March 9, according to data from the Federal Reserve. This is more than the whole of 2008, in which savings deposits rose by $229bn.
The big plunge into cash comes in spite of repeated government attempts to restart frozen fixed-income markets and restore confidence in the financial system.
It is not clear where all the deposits came from but in the first two months of the year investors pulled $20bn from stock mutual funds – almost half the total $43bn redeemed during the whole of 2008 – as they appeared to lose confidence in stock markets, according to data from Financial Research Corporation.
During the first nine weeks of the year, investors pulled a small amount – $15bn – from savings accounts with a period of notice, in an apparent indication they were reluctant to lock up cash for even short periods of time.
Charles Biderman, chief executive of TrimTabs, a research group, said: “Net flows into savings have gone into only two places – bank savings and US Treasuries. Both . . . offer extremely low yields with a high degree of safety.
“During an economy where equity prices are down about 50 per cent and home prices down about 30 per cent or so, is there any question as to why money is flowing only into the safest bets?”
Historically, money flows more strongly into bank accounts when stock markets are falling. In 2005 and 2006, when US equities rose, retail investors put less than $100bn into savings and current accounts each year.
The previous record year for a rise in bank deposits was 2002, following the dotcom boom, when deposits rose by $465bn. “During hard times people worry about return of principal, not return on principal,” Mr Biderman said.
As retail investors seek cash, hedge fund managers are placing big bets on gold in the belief that paper currencies will be debased.
The Federal Reserve tracks assets held in bank accounts, not actual inflows. But with interest rates at typical savings accounts hovering below 2 per cent, the rise in deposits – which includes current accounts – is overwhelmingly due to an inflow of new money rather than returns.
By Lynnley Browning
Copyright by tHe International Herald Tribune
Published: March 26, 2009
http://www.iht.com/articles/2009/03/26/business/27tax.php
The Internal Revenue Service, under pressure to bring in money to the faltering economy, plans to give offshore tax evaders a big break.
The agency has drafted a plan that significantly lowers a penalty that applies to wealthy Americans who hide money overseas in secret accounts, a person briefed on the matter said Thursday. The plan is intended to lure out of hiding scores of wealthy people who must come forward and declare their accounts in order to take advantage of the lower penalty.
The plan was developed amid a widening investigation into wealthy American clients of UBS but will apply to clients of other banks as well.
Under the plan, according to the person briefed on the issue, the I.R.S. will cut an onerous penalty for not filing a Report of Foreign Bank and Financial Account, known as an Fbar — something offshore tax evaders have not done.
The current penalty is 50 percent of the high balance of each account over the last three years — an amount that can wipe out an investor's accounts in just two years — but the I.R.S. will reduce that penalty to 5 percent to 20 percent, depending in part on whether the wealth was inherited.
The I.R.S. will also require taxpayers to pay any taxes and interest owed over the last six years, as well as assess a standard, accuracy-related penalty of 20 percent. Taxpayers must also file amended returns for the last six years.
The proposal, which the I.R.S. is communicating to its field agents who audit returns, does not allow taxpayers to escape potential prosecution, but it makes that outcome less likely, in particular for those covered under the 5 percent Fbar penalty, this person said.
"They need to get money back into the system, so they needed to sweeten the deal," the person said.
An I.R.S. spokesman declined to comment.
The plan comes after the I.R.S. last November scrapped a last-minute proposal to create a global settlement for taxpayers with offshore accounts. Such settlements in the past have come under criticism for not attracting enough tax evaders.
The new plan may be more likely to draw in tax evaders because the I.R.S. and the Justice Department are exerting significant legal pressure on UBS, the world's largest private bank, to disclose 52,000 client names. Unless those clients come forward before their names are potentially turned over, they can face a heightened risk of being prosecuted, as well as the steeper Fbar penalties.
US retail investors flee to savings
By Deborah Brewster in New York
Copyright The Financial Times Limited 2009
Published: March 25 2009 23:37 | Last updated: March 25 2009 23:37
http://www.ft.com/cms/s/0/182e200a-1973-11de-9d34-0000779fd2ac.html
US retail investors poured close to $250bn (€184bn) into bank accounts in the first months of this year, sharply accelerating a flight to safety as they continued to flee volatile stock markets.
Bank savings deposits rose by $246bn to a record $4,343bn in the nine weeks to March 9, according to data from the Federal Reserve. This is more than the whole of 2008, in which savings deposits rose by $229bn.
The big plunge into cash comes in spite of repeated government attempts to restart frozen fixed-income markets and restore confidence in the financial system.
It is not clear where all the deposits came from but in the first two months of the year investors pulled $20bn from stock mutual funds – almost half the total $43bn redeemed during the whole of 2008 – as they appeared to lose confidence in stock markets, according to data from Financial Research Corporation.
During the first nine weeks of the year, investors pulled a small amount – $15bn – from savings accounts with a period of notice, in an apparent indication they were reluctant to lock up cash for even short periods of time.
Charles Biderman, chief executive of TrimTabs, a research group, said: “Net flows into savings have gone into only two places – bank savings and US Treasuries. Both . . . offer extremely low yields with a high degree of safety.
“During an economy where equity prices are down about 50 per cent and home prices down about 30 per cent or so, is there any question as to why money is flowing only into the safest bets?”
Historically, money flows more strongly into bank accounts when stock markets are falling. In 2005 and 2006, when US equities rose, retail investors put less than $100bn into savings and current accounts each year.
The previous record year for a rise in bank deposits was 2002, following the dotcom boom, when deposits rose by $465bn. “During hard times people worry about return of principal, not return on principal,” Mr Biderman said.
As retail investors seek cash, hedge fund managers are placing big bets on gold in the belief that paper currencies will be debased.
The Federal Reserve tracks assets held in bank accounts, not actual inflows. But with interest rates at typical savings accounts hovering below 2 per cent, the rise in deposits – which includes current accounts – is overwhelmingly due to an inflow of new money rather than returns.
Geithner lays out new financial rules/Geithner ‘power grab’ could worry creditors
Geithner lays out new financial rules
By Tom Braithwaite in Washington
Copyright The Financial Times Limited 2009
Published: March 26 2009 14:36 | Last updated: March 26 2009 14:52
http://www.ft.com/cms/s/0/9d8a6dd2-1a11-11de-9f91-0000779fd2ac.html
Tim Geithner, US Treasury secretary, set out plans for more stringent scrutiny of the financial services sector, capturing hedge funds and derivatives in a new regulatory regime and demanding institutions build up a bigger layer of capital.
Appearing on Thursday before the House financial services committee, Mr Geithner said that “our system failed in basic fundamental ways” and described his reform of regulation as “not modest repairs at the margin, but new rules of the game”.
“This crisis has made clear that certain large, interconnected firms and markets need to be under a more consistent, and more conservative regulatory regime,” said Mr Geithner. “These standards cannot simply address the soundness of individual institutions, but must also ensure the stability of the system itself.”
Hedge funds above an unspecified size would have to register with the Securities and Exchange Commission and provide data on their counter-parties. Over-the-counter derivatives trades would also be subject to more scrutiny and the administration would “force” trades to go through an approved central clearing house.
Extra rules on derivatives trading are an attempt to prevent a repeat of the near-collapse of AIG, the insurance group, whose risky dealing in credit default swaps led to a $173bn bailout with federal money last September.
Mr Geithner said there were also lessons to be learned from the collapse of Lehman Brothers last year, which led indirectly to a run on money market mutual funds, previously viewed as one of the safest parts of the financial services sector. He said the SEC would be directed to tighten its rules over the funds.
These complex instruments were poorly understood by counterparties, and the implication that they could threaten the entire financial system or bring down a company of the size and scope of AIG was not identified by regulators, in part because the CDS markets lacked transparency.
The broad regulatory overhaul will take on an international dimension, a facet likely to please French and German governments ahead of the Group of 20 summit in London on April 2. Many Europeans see financial regulation as a topic preferable to talk of more fiscal stimulus.
“Markets are global and high standards at home need to be complemented by strong international standards enforced more evenly and fairly,” said Mr Geithner. The administration is to propose a crackdown on tax havens and money laundering.
The regulatory overhaul is safer ground for Mr Geithner who has endured sustained criticism during his two-month tenure as Treasury secretary, accused of presenting a lack of detail in plans to fix the banking sector and questioned over his part in drawing up law that allowed AIG, the bailed-out insurer, to pay large retention bonuses to executives.
Spencer Bachus, the leading Republican on the committee, said legislators must “not rush” into new regulation and said there was a lack of detail in the regulatory framework.
Banking stocks took a sudden tumble after the release of Mr Geithner’s testimony . The sector’s confidence was already fragile after the ratings agency Moody’s downgraded Bank of America’s debt. The bank lost 2.2 per cent to $7.53. Other banks also fell, including Citigroup, which dropped 2 per cent to $2.89 and Wells Fargo, falling 1.6 per cent to $16.15.
Geithner ‘power grab’ could worry creditors
By Tom Braithwaite in Washington and Joanna Chung in New York
Copyright The Financial Times Limited 2009
Published: March 25 2009 20:35 | Last updated: March 25 2009 20:35
http://www.ft.com/cms/s/0/a6c2516c-197b-11de-9d34-0000779fd2ac.html
Tim Geithner’s bid for new power to force a restructuring at failing financial institutions is securing broad approval in Congress, but may prove worrying to creditors.
The Treasury secretary, who returns to Capitol Hill on Thursday to set out his vision for regulatory overhaul in the US, released more details on Wednesday on a plan for a legal framework to put a “non-bank” into receivership at the behest of the government.
With the backing of Ben Bernanke, Federal Reserve chairman, Mr Geithner wants powers to “resolve’’ ailing companies that are deemed systemically important.
He told legislators on Tuesday that such powers would have allowed the government to handle better the collapse of AIG, the giant insurer now surviving on $173bn of taxpayer funds.
“It doesn’t really matter if it’s called a bank, a hedge fund or a purple panda,” says Randy Quarles, a managing director at Carlyle Group, the private equity firm, and former Treasury undersecretary.
“I think it is important for regulators to have the ability to step in in advance of a run actually happening at a systemically important institution.”
Where the power lies is a potential stumbling block for Mr Geithner.
The Federal Deposit Insurance Corporation, which has resolution authority over deposit-taking banks, may end up with the authority but Mr Geithner wants the president, the Treasury and the Federal Reserve to weigh in on any initial decision.
House Republican leader John Boehner said on Tuesday that Mr Geithner’s plan sounded like “an unprecedented grab of power”.
The desire for a broader resolution authority has taken on an added urgency, not least because sweeping powers, particularly over bank holding companies, could be needed following planned stress tests on the largest US banks.
A draft bill is due to be sent to Congress this week, the Treasury said on Wednesday, which would allow the government to “sell or transfer the assets or liabilities . . . to deal with a derivatives book . . . [and replace a] board of directors.
None of these actions would be subject to the approval of the institution’s creditors or other stakeholders.”
John Douglas, a former FDIC counsel and now banking regulation lawyer at Paul, Hastings, Janofsky & Walker, warns that any process that overrides the bankruptcy code could have unforeseen consequences.
“If AIG had gone into bankruptcy there is a well-structured mechanism to figure out who gets paid and who doesn’t get paid. The problem with a government mandated receivership is that the outcomes are not clear.”
For bondholders and other creditors of institutions going through receivership, “there is no mechanism for them to figure out what’s going on in the bowels of the FDIC . . . [That] will impact upon their willingness to lend to institutions on an ongoing basis”.
Alan Avery, a lawyer at Arnold & Porter, believes the FDIC’s “broad authority to repudiate or renegotiate any contract that an institution has entered into” is an appealing power that could save taxpayers’ money.
A minor – but politically attractive – feature of the planned resolution authority is that bonus contracts could be ripped up – preventing a repeat of AIG’s $165m payments to executives that caused public uproar.
By Tom Braithwaite in Washington
Copyright The Financial Times Limited 2009
Published: March 26 2009 14:36 | Last updated: March 26 2009 14:52
http://www.ft.com/cms/s/0/9d8a6dd2-1a11-11de-9f91-0000779fd2ac.html
Tim Geithner, US Treasury secretary, set out plans for more stringent scrutiny of the financial services sector, capturing hedge funds and derivatives in a new regulatory regime and demanding institutions build up a bigger layer of capital.
Appearing on Thursday before the House financial services committee, Mr Geithner said that “our system failed in basic fundamental ways” and described his reform of regulation as “not modest repairs at the margin, but new rules of the game”.
“This crisis has made clear that certain large, interconnected firms and markets need to be under a more consistent, and more conservative regulatory regime,” said Mr Geithner. “These standards cannot simply address the soundness of individual institutions, but must also ensure the stability of the system itself.”
Hedge funds above an unspecified size would have to register with the Securities and Exchange Commission and provide data on their counter-parties. Over-the-counter derivatives trades would also be subject to more scrutiny and the administration would “force” trades to go through an approved central clearing house.
Extra rules on derivatives trading are an attempt to prevent a repeat of the near-collapse of AIG, the insurance group, whose risky dealing in credit default swaps led to a $173bn bailout with federal money last September.
Mr Geithner said there were also lessons to be learned from the collapse of Lehman Brothers last year, which led indirectly to a run on money market mutual funds, previously viewed as one of the safest parts of the financial services sector. He said the SEC would be directed to tighten its rules over the funds.
These complex instruments were poorly understood by counterparties, and the implication that they could threaten the entire financial system or bring down a company of the size and scope of AIG was not identified by regulators, in part because the CDS markets lacked transparency.
The broad regulatory overhaul will take on an international dimension, a facet likely to please French and German governments ahead of the Group of 20 summit in London on April 2. Many Europeans see financial regulation as a topic preferable to talk of more fiscal stimulus.
“Markets are global and high standards at home need to be complemented by strong international standards enforced more evenly and fairly,” said Mr Geithner. The administration is to propose a crackdown on tax havens and money laundering.
The regulatory overhaul is safer ground for Mr Geithner who has endured sustained criticism during his two-month tenure as Treasury secretary, accused of presenting a lack of detail in plans to fix the banking sector and questioned over his part in drawing up law that allowed AIG, the bailed-out insurer, to pay large retention bonuses to executives.
Spencer Bachus, the leading Republican on the committee, said legislators must “not rush” into new regulation and said there was a lack of detail in the regulatory framework.
Banking stocks took a sudden tumble after the release of Mr Geithner’s testimony . The sector’s confidence was already fragile after the ratings agency Moody’s downgraded Bank of America’s debt. The bank lost 2.2 per cent to $7.53. Other banks also fell, including Citigroup, which dropped 2 per cent to $2.89 and Wells Fargo, falling 1.6 per cent to $16.15.
Geithner ‘power grab’ could worry creditors
By Tom Braithwaite in Washington and Joanna Chung in New York
Copyright The Financial Times Limited 2009
Published: March 25 2009 20:35 | Last updated: March 25 2009 20:35
http://www.ft.com/cms/s/0/a6c2516c-197b-11de-9d34-0000779fd2ac.html
Tim Geithner’s bid for new power to force a restructuring at failing financial institutions is securing broad approval in Congress, but may prove worrying to creditors.
The Treasury secretary, who returns to Capitol Hill on Thursday to set out his vision for regulatory overhaul in the US, released more details on Wednesday on a plan for a legal framework to put a “non-bank” into receivership at the behest of the government.
With the backing of Ben Bernanke, Federal Reserve chairman, Mr Geithner wants powers to “resolve’’ ailing companies that are deemed systemically important.
He told legislators on Tuesday that such powers would have allowed the government to handle better the collapse of AIG, the giant insurer now surviving on $173bn of taxpayer funds.
“It doesn’t really matter if it’s called a bank, a hedge fund or a purple panda,” says Randy Quarles, a managing director at Carlyle Group, the private equity firm, and former Treasury undersecretary.
“I think it is important for regulators to have the ability to step in in advance of a run actually happening at a systemically important institution.”
Where the power lies is a potential stumbling block for Mr Geithner.
The Federal Deposit Insurance Corporation, which has resolution authority over deposit-taking banks, may end up with the authority but Mr Geithner wants the president, the Treasury and the Federal Reserve to weigh in on any initial decision.
House Republican leader John Boehner said on Tuesday that Mr Geithner’s plan sounded like “an unprecedented grab of power”.
The desire for a broader resolution authority has taken on an added urgency, not least because sweeping powers, particularly over bank holding companies, could be needed following planned stress tests on the largest US banks.
A draft bill is due to be sent to Congress this week, the Treasury said on Wednesday, which would allow the government to “sell or transfer the assets or liabilities . . . to deal with a derivatives book . . . [and replace a] board of directors.
None of these actions would be subject to the approval of the institution’s creditors or other stakeholders.”
John Douglas, a former FDIC counsel and now banking regulation lawyer at Paul, Hastings, Janofsky & Walker, warns that any process that overrides the bankruptcy code could have unforeseen consequences.
“If AIG had gone into bankruptcy there is a well-structured mechanism to figure out who gets paid and who doesn’t get paid. The problem with a government mandated receivership is that the outcomes are not clear.”
For bondholders and other creditors of institutions going through receivership, “there is no mechanism for them to figure out what’s going on in the bowels of the FDIC . . . [That] will impact upon their willingness to lend to institutions on an ongoing basis”.
Alan Avery, a lawyer at Arnold & Porter, believes the FDIC’s “broad authority to repudiate or renegotiate any contract that an institution has entered into” is an appealing power that could save taxpayers’ money.
A minor – but politically attractive – feature of the planned resolution authority is that bonus contracts could be ripped up – preventing a repeat of AIG’s $165m payments to executives that caused public uproar.
U.S. sees Chinese military rise/Beijing’s naval harassment rouses US/‘More Chinese missiles’ in Taiwan Strait
U.S. sees Chinese military rise
By Thom Shanker
copyright by The International Herald Tribune
Published: March 26, 2009
http://www.iht.com/articles/2009/03/26/news/27military.php
WASHINGTON: China is seeking technology and weapons to disrupt the traditional advantages of American forces, and secrecy surrounding its military creates the potential for miscalculation on both sides, according to a Pentagon study released Wednesday.
The annual report from the Defense Department to Congress, "Military Power of the People's Republic of China 2009," catalogs efforts by China to supply its armed forces with weapons that can be used to intimidate and attack Taiwan and blunt the superiority of American naval and air power, at least near its territory.
"We have advocated time and again for more dialogue and transparency in our dealings with the Chinese government and military, all in an effort to reduce suspicions on both sides," said Geoff Morrell, the Pentagon press secretary.
He said the report should be read as calling "for deeper, broader, more high-level contacts with the Chinese."
China's Foreign Ministry spokesman, Qin Gang, dismissed the Pentagon report on Thursday as "a gross distortion of the facts" and interference in China's internal affairs.
"This report issued by the U. S. side continues to play up the fallacy of China's military threat," he said at his regular news briefing in Beijing. He suggested that the Pentagon stop issuing the annual report to avoid "further damage to the two sides' military relations."
China suspended high-level contacts with the Pentagon last October in response to the Bush administration's decision to sell a record $6.5 billion in military equipment to Taiwan. But relations appeared to improve after the deputy assistant secretary of defense for East Asia, David S. Sedney, held two days of talks with his Chinese counterparts last month.
Military relations between the United States and China have tended to crest and then fall over recent years, with ties having just recovered from Beijing's outrage over the sales to Taiwan.
But even the resumption of military-to-military talks was threatened this month after Chinese vessels shadowed and harassed an American surveillance ship in international waters of the South China Sea.
The Pentagon report describes how China's military modernization has continued over the past year, with a particular focus on Taiwan, which China considers a renegade province. China has built up short-range missiles across from Taiwan, even though the report concludes that relations between the two have relaxed over the past year.
Even so, the study said China could not deploy and sustain even small military units far beyond its borders before 2015. Further, China would not be able to deploy and sustain large forces in combat operations far from China until well into the following decade, the report states.
Instead, the Chinese military appears to have embarked on modernization programs that would allow it to fight and win short conflicts fought with new weapons along its periphery.
To blunt traditional advantages of the United States, China has invested in new technologies for cyber- and space warfare, in addition to sustaining and modernizing its nuclear arsenal, the report said. The Chinese military also is expanding and improving its fleet of submarines, and hopes to build a number of new aircraft carriers, the report said.
The report does single out acts by the Chinese military to participate in international relief and rescue missions. Between 2002 and 2007, the People's Liberation Army joined at least 14 search-and-rescue missions at sea, and was involved in 10 emergency relief missions in 14 countries.
Between 2003 and 2007, China also sold nearly $7 billion worth of conventional weapons around the world, mostly to Pakistan, the report said.
Rep. Ike Skelton, the Missouri Democrat who is chairman of the House Armed Services Committee, released a statement on Wednesday that expressed concern at "some of the continuing trends and ambiguities regarding China's military modernization, including China's missile buildup across from Taiwan and the steady increase of China's power projection capabilities."
He said that "China's military budget continues a trend of double-digit increases and questions remain about China's strategic intentions."
Michael Wines contributed reporting from Beijing.
Beijing’s naval harassment rouses US
By Demetri Sevastopulo in Washington and Kathrin Hille in Beijing
Copyright The Financial Times Limited 2009
Published: March 25 2009 18:37 | Last updated: March 26 2009 03:23
http://www.ft.com/cms/s/0/38043386-196b-11de-9d34-0000779fd2ac.html
When Chinese ships recently harassed the Impeccable, a US navy surveillance ship, in the South China Sea, they shone the spotlight on brewing regional tensions that until that point were moving only slowly onto the US radar.
By surrounding, and then blocking, the Impeccable, the Chinese navy inadvertently succeeded in explaining what Robert Gates, US defence secretary, meant when he referred to “coercive diplomacy and other pressures” in a nuanced speech to Asian defence officials in Singapore last year.
“The Chinese are very sophisticated, but in this latest incident [in terms of harassing ships] I think they stepped in it,” says Marvin Ott, a south-east Asia expert at the US National War College.
“The Impeccable incident will cause the US to drop its lethargy and start to focus on the issue.”
The proximate cause of the incident may have been that the Impeccable was learning too much about Chinese submarines based at Hainan Island that were conducting exercises in the South China Sea.
“The Chinese have decided that one of their biggest naval facilities is going to be at Hainan, therefore the area is becoming more sensitive for the Chinese military,” said Dennis Wilder, a China military expert at the Brookings Institution who served as George W. Bush’s top Asia adviser until January.
“The Chinese goal is to have the US back away from sensitive areas.”
China is especially sensitive about US operations near Hainan because the island is being used to base a new sophisticated Jin-class submarine that will carry nuclear-armed intercontinental ballistic missiles.
“It is well known that the submarine base was established [at Hainan], so it is unacceptable for China to have the US navy snooping around so close,” said Li Jinming, a South China Sea expert at Xiamen University.
The US has already made clear that it does not intend to stop surveillance missions just because of the Impeccable incident. The US navy has become more concerned about Chinese submarines since one vessel surfaced undetected by radar within firing range of a US aircraft carrier in 2006.
Michael Swaine, a China expert at the Carnegie Endowment, says China appears to be responding more aggressively as the US increases the frequency of its spying missions.
“They want to keep capable, advanced, foreign navies away from their shores…It is to reduce the ability of the US to operate freely along their coast.”
China has also signalled that it intends to build a “blue water” navy with aircraft carriers. While some China hawks in the US question Chinese intent, other defence officials see the growing Chinese naval presence as natural for a country that is growing into a superpower.
“There are legitimate reasons for them to grow a ‘blue water’ navy, mostly to help the rest of us to ensure the stability and prosperity of this globalised world of ours,” said one US defence official.
“We’re okay with that and we want to engage with them going forwards and partner [them] where it makes sense. It’s the other things that they are doing on the way that leave you baffled, like this incident with the Impeccable.”
Experts point to a range of other reasons for the increased aggressiveness in the South China Sea. The Chinese navy is expanding its reach beyond its coast as part of the country’s defence strategy.
David Finkelstein, director of China studies at CNA, a defence think-tank, says Beijing made clear for the first time in 2006 that the People’s Liberation Army navy would expand its “strategic depth” off the Chinese coast.
“As the PLA navy goes further out to sea it will certainly encounter the US navy, and it is not out of the question that a conscious decision has been made by Beijing to engage in the practice of periodically challenging the US navy’s ability to operate with impunity in China’s exclusive economic zone [EEZ], even though China’s EEZ constitutes waters in which all nations can exercise high seas freedom.”
The expansion of Chinese military activities in the area also comes as countries jostle over competing claims for maritime territory that may be energy-rich. Vietnam, in particular, has complained to the US about Chinese diplomatic and military aggressiveness.
“The tensions are flaring up because Vietnam is coming into its own, and inviting foreign companies to do energy deals,” says Mr Wilder. “China has told western companies not to contest the waters, and most companies have backed off.”
Michael Green, another former top Asia adviser to Mr Bush, says the Chinese are also tackling the Americans to send a signal to other countries.
“The Chinese are elbowing, seeing how far they can go before the referee blows the whistle on them and they get a yellow card,” says Mr Green. “This is also a signal to Vietnam, the Philippines, and the smaller countries in the region, that ‘look, if we can do this to the Americans, what chance do you think you have?’.”
James Clad, the top Pentagon official for south-east Asia until January, agrees that China is challenging the US navy partly to send a message to energy companies looking to operate in the region.
”Some analysts believe China increasingly is orienting itself to the south…China has been putting steadily increasing pressure on energy companies over the past several years in the South China Sea.”
Mr Clad says a number of Western firms, including Chevron, BP, and Exxon Mobil, have entered exploration and production (E&P) arrangements with PetroVietnam, ”none of which has pleased Beijing”.
”By crowding the USNS Impeccable, China is telegraphing without much ambiguity that it can easily treat energy company survey ships in the same manner,” he added.
Military experts in Beijing say another reason for the more aggressive behaviour from the PLA navy is the economic side of China’s sovereignty claim over most of the South China Sea.
Analysts agree that the moves earlier this year of Malaysia’s prime minister to renew the country’s claim over certain islands in the area and of the Philippine parliament to pass a law expanding its claimed continental shelf forced Beijing to decide it had to take a harder stance.
Beijing felt that it had become the only country still practicing restraint, and was losing out doing so, says Chinese scholars. The 2002 Asean Declaration on Conduct in the South China Sea under which all participants, including China, pledged to put aside controversy and tap resources together, had been “violated by everyone but China,” says Mr Li.
Some US officials see a broader move by China to assert control over an area inside what the Chinese call the “six segment dotted line”, particularly as the Chinese navy develops increased capabilities to project power. Sometimes referred to the “cow’s tongue” outside China because of its shape, the boundary marks China’s definition of its maritime territory.
“China appears to have a long-term interest in gradually expanding ’sovereignty’ inside the six segment dotted line,” said one senior US defence official.
But the official said China may also see the lower tensions across the Taiwan Strait as an opportunity to shift their focus.
“Some in the Chinese military did not believe that the soft policy of [President] Hu Jintao would work, because they felt they needed Taiwan as a justification for continued military spending, but it is working and so now they need a new rationale.”
China hawks within the US military are often accused of using the rise of China as a pretext to justify increased funding for weapons such as the F-22 fighter jet. Much in the same manner, some US experts argue that the PLA navy has learned a trick from the Pentagon playbook, and is using the increased tensions in the South China Sea as justification for its own funding during a tight economic environment.
While lower tensions with Taiwan may have provided some space for the Chinese military, Mr Ott says the overall geopolitical landscape has shifted in a way that has prompted China to change its strategy. He says China has been playing “defence” in Northeast Asia, but now sees opportunity in south-east Asia which is the “soft underbelly”.
“The traditional historic strategic threats – Russia and Japan – are off the board so China is free for the first time since the Ming dynasty to be proactively assertive in terms of their interests and they see those interests primarily through to the south,” says Mr Ott.
“What the Chinese see in Southeast Asia is a natural sphere of influence,” says Mr Ott. “This is China’s Central America. They want to push US military power out of their backyard.”
To contact the reporter, email demetri.sevastopulo@ft.com
‘More Chinese missiles’ in Taiwan Strait
By Demetri Sevastopulo in Washington
Copyright The Financial Times Limited 2009
Published: March 25 2009 18:50 | Last updated: March 25 2009 23:19
http://www.ft.com/cms/s/0/4a5104aa-196c-11de-9d34-0000779fd2ac.html
China deployed more missiles across the Taiwan Strait during the past year in spite of a decline in tensions since a new Taiwanese president was elected, the Pentagon said on Wednesday.
In its annual report on the Chinese military, the US defence department said China was “rapidly developing coercive capabilities” to deter Taiwan – which Beijing considers a renegade province – from seeking de jure independence.
“These same capabilities could in the future be used to pressure Taiwan toward a settlement of the cross-strait dispute on Beijing’s terms while simultaneously attempting to deter, delay or deny any possible US support for the island in case of conflict,” the report said.
“This modernisation and the threat to Taiwan continue despite significant reduction in cross-strait tension over the last year since Taiwan elected a new president.”
The report, mandated by the US Congress, comes just a few weeks after an incident in the South China Sea in which five Chinese naval, fisheries and fishing ships harassed the USNS Impeccable, a US navy ship used for detecting submarines. Defence experts say the Chinese navy is increasingly trying to challenge the US Seventh Fleet, which has long been the dominant naval power in the region.
Hawks in the US are concerned that China is expanding the capabilities of its military to become more aggressive in Asia and elsewhere.
Other officials say it is natural for China to develop its military as it grows into a big power, but they have concerns about a lack of transparency.
“There are legitimate reasons for them to grow a ‘blue water’ navy, mostly to help the rest of us to ensure the stability and prosperity of this globalised world of ours,” said one US defence official. “So we’re okay with that and we want to engage with them going forwards and partner [them] where it makes sense. It’s the other things that they are doing on the way that leaves you baffled, like this incident with the Impeccable.”
Following several days of heated rhetoric, the US and China have attempted to ratchet down the tensions. The US sent a destroyer to protect the Impeccable, but the White House was later annoyed that the Pentagon revealed the move to avoid the perception that the US was trying to escalate the incident.
While the Chinese military budget has benefited from double-digit growth for years, the Pentagon said the People’s Liberation Army still had “limited” ability to sustain military power at a distance. But it said the Chinese continued to develop “disruptive technologies”, such as missiles that would hinder adversaries from entering a battle zone, that “are changing regional military balances and that have implications beyond the Asia-Pacific region”.
Disruptive technologies are products or processes that marginalise older technologies. In the military, cyber warfare can disable computer-based weapons systems. In 2007, China destroyed one of its weather satellites in space with a kinetic weapon, leading to concerns in the US about the safety of its surveillance and communications satellites.
The Pentagon said China’s lack of transparency on its military spending and capabilities “poses risks to stability by creating uncertainty and increasing the potential for misunderstanding and miscalculation”.
Additional reporting by agencies.
By Thom Shanker
copyright by The International Herald Tribune
Published: March 26, 2009
http://www.iht.com/articles/2009/03/26/news/27military.php
WASHINGTON: China is seeking technology and weapons to disrupt the traditional advantages of American forces, and secrecy surrounding its military creates the potential for miscalculation on both sides, according to a Pentagon study released Wednesday.
The annual report from the Defense Department to Congress, "Military Power of the People's Republic of China 2009," catalogs efforts by China to supply its armed forces with weapons that can be used to intimidate and attack Taiwan and blunt the superiority of American naval and air power, at least near its territory.
"We have advocated time and again for more dialogue and transparency in our dealings with the Chinese government and military, all in an effort to reduce suspicions on both sides," said Geoff Morrell, the Pentagon press secretary.
He said the report should be read as calling "for deeper, broader, more high-level contacts with the Chinese."
China's Foreign Ministry spokesman, Qin Gang, dismissed the Pentagon report on Thursday as "a gross distortion of the facts" and interference in China's internal affairs.
"This report issued by the U. S. side continues to play up the fallacy of China's military threat," he said at his regular news briefing in Beijing. He suggested that the Pentagon stop issuing the annual report to avoid "further damage to the two sides' military relations."
China suspended high-level contacts with the Pentagon last October in response to the Bush administration's decision to sell a record $6.5 billion in military equipment to Taiwan. But relations appeared to improve after the deputy assistant secretary of defense for East Asia, David S. Sedney, held two days of talks with his Chinese counterparts last month.
Military relations between the United States and China have tended to crest and then fall over recent years, with ties having just recovered from Beijing's outrage over the sales to Taiwan.
But even the resumption of military-to-military talks was threatened this month after Chinese vessels shadowed and harassed an American surveillance ship in international waters of the South China Sea.
The Pentagon report describes how China's military modernization has continued over the past year, with a particular focus on Taiwan, which China considers a renegade province. China has built up short-range missiles across from Taiwan, even though the report concludes that relations between the two have relaxed over the past year.
Even so, the study said China could not deploy and sustain even small military units far beyond its borders before 2015. Further, China would not be able to deploy and sustain large forces in combat operations far from China until well into the following decade, the report states.
Instead, the Chinese military appears to have embarked on modernization programs that would allow it to fight and win short conflicts fought with new weapons along its periphery.
To blunt traditional advantages of the United States, China has invested in new technologies for cyber- and space warfare, in addition to sustaining and modernizing its nuclear arsenal, the report said. The Chinese military also is expanding and improving its fleet of submarines, and hopes to build a number of new aircraft carriers, the report said.
The report does single out acts by the Chinese military to participate in international relief and rescue missions. Between 2002 and 2007, the People's Liberation Army joined at least 14 search-and-rescue missions at sea, and was involved in 10 emergency relief missions in 14 countries.
Between 2003 and 2007, China also sold nearly $7 billion worth of conventional weapons around the world, mostly to Pakistan, the report said.
Rep. Ike Skelton, the Missouri Democrat who is chairman of the House Armed Services Committee, released a statement on Wednesday that expressed concern at "some of the continuing trends and ambiguities regarding China's military modernization, including China's missile buildup across from Taiwan and the steady increase of China's power projection capabilities."
He said that "China's military budget continues a trend of double-digit increases and questions remain about China's strategic intentions."
Michael Wines contributed reporting from Beijing.
Beijing’s naval harassment rouses US
By Demetri Sevastopulo in Washington and Kathrin Hille in Beijing
Copyright The Financial Times Limited 2009
Published: March 25 2009 18:37 | Last updated: March 26 2009 03:23
http://www.ft.com/cms/s/0/38043386-196b-11de-9d34-0000779fd2ac.html
When Chinese ships recently harassed the Impeccable, a US navy surveillance ship, in the South China Sea, they shone the spotlight on brewing regional tensions that until that point were moving only slowly onto the US radar.
By surrounding, and then blocking, the Impeccable, the Chinese navy inadvertently succeeded in explaining what Robert Gates, US defence secretary, meant when he referred to “coercive diplomacy and other pressures” in a nuanced speech to Asian defence officials in Singapore last year.
“The Chinese are very sophisticated, but in this latest incident [in terms of harassing ships] I think they stepped in it,” says Marvin Ott, a south-east Asia expert at the US National War College.
“The Impeccable incident will cause the US to drop its lethargy and start to focus on the issue.”
The proximate cause of the incident may have been that the Impeccable was learning too much about Chinese submarines based at Hainan Island that were conducting exercises in the South China Sea.
“The Chinese have decided that one of their biggest naval facilities is going to be at Hainan, therefore the area is becoming more sensitive for the Chinese military,” said Dennis Wilder, a China military expert at the Brookings Institution who served as George W. Bush’s top Asia adviser until January.
“The Chinese goal is to have the US back away from sensitive areas.”
China is especially sensitive about US operations near Hainan because the island is being used to base a new sophisticated Jin-class submarine that will carry nuclear-armed intercontinental ballistic missiles.
“It is well known that the submarine base was established [at Hainan], so it is unacceptable for China to have the US navy snooping around so close,” said Li Jinming, a South China Sea expert at Xiamen University.
The US has already made clear that it does not intend to stop surveillance missions just because of the Impeccable incident. The US navy has become more concerned about Chinese submarines since one vessel surfaced undetected by radar within firing range of a US aircraft carrier in 2006.
Michael Swaine, a China expert at the Carnegie Endowment, says China appears to be responding more aggressively as the US increases the frequency of its spying missions.
“They want to keep capable, advanced, foreign navies away from their shores…It is to reduce the ability of the US to operate freely along their coast.”
China has also signalled that it intends to build a “blue water” navy with aircraft carriers. While some China hawks in the US question Chinese intent, other defence officials see the growing Chinese naval presence as natural for a country that is growing into a superpower.
“There are legitimate reasons for them to grow a ‘blue water’ navy, mostly to help the rest of us to ensure the stability and prosperity of this globalised world of ours,” said one US defence official.
“We’re okay with that and we want to engage with them going forwards and partner [them] where it makes sense. It’s the other things that they are doing on the way that leave you baffled, like this incident with the Impeccable.”
Experts point to a range of other reasons for the increased aggressiveness in the South China Sea. The Chinese navy is expanding its reach beyond its coast as part of the country’s defence strategy.
David Finkelstein, director of China studies at CNA, a defence think-tank, says Beijing made clear for the first time in 2006 that the People’s Liberation Army navy would expand its “strategic depth” off the Chinese coast.
“As the PLA navy goes further out to sea it will certainly encounter the US navy, and it is not out of the question that a conscious decision has been made by Beijing to engage in the practice of periodically challenging the US navy’s ability to operate with impunity in China’s exclusive economic zone [EEZ], even though China’s EEZ constitutes waters in which all nations can exercise high seas freedom.”
The expansion of Chinese military activities in the area also comes as countries jostle over competing claims for maritime territory that may be energy-rich. Vietnam, in particular, has complained to the US about Chinese diplomatic and military aggressiveness.
“The tensions are flaring up because Vietnam is coming into its own, and inviting foreign companies to do energy deals,” says Mr Wilder. “China has told western companies not to contest the waters, and most companies have backed off.”
Michael Green, another former top Asia adviser to Mr Bush, says the Chinese are also tackling the Americans to send a signal to other countries.
“The Chinese are elbowing, seeing how far they can go before the referee blows the whistle on them and they get a yellow card,” says Mr Green. “This is also a signal to Vietnam, the Philippines, and the smaller countries in the region, that ‘look, if we can do this to the Americans, what chance do you think you have?’.”
James Clad, the top Pentagon official for south-east Asia until January, agrees that China is challenging the US navy partly to send a message to energy companies looking to operate in the region.
”Some analysts believe China increasingly is orienting itself to the south…China has been putting steadily increasing pressure on energy companies over the past several years in the South China Sea.”
Mr Clad says a number of Western firms, including Chevron, BP, and Exxon Mobil, have entered exploration and production (E&P) arrangements with PetroVietnam, ”none of which has pleased Beijing”.
”By crowding the USNS Impeccable, China is telegraphing without much ambiguity that it can easily treat energy company survey ships in the same manner,” he added.
Military experts in Beijing say another reason for the more aggressive behaviour from the PLA navy is the economic side of China’s sovereignty claim over most of the South China Sea.
Analysts agree that the moves earlier this year of Malaysia’s prime minister to renew the country’s claim over certain islands in the area and of the Philippine parliament to pass a law expanding its claimed continental shelf forced Beijing to decide it had to take a harder stance.
Beijing felt that it had become the only country still practicing restraint, and was losing out doing so, says Chinese scholars. The 2002 Asean Declaration on Conduct in the South China Sea under which all participants, including China, pledged to put aside controversy and tap resources together, had been “violated by everyone but China,” says Mr Li.
Some US officials see a broader move by China to assert control over an area inside what the Chinese call the “six segment dotted line”, particularly as the Chinese navy develops increased capabilities to project power. Sometimes referred to the “cow’s tongue” outside China because of its shape, the boundary marks China’s definition of its maritime territory.
“China appears to have a long-term interest in gradually expanding ’sovereignty’ inside the six segment dotted line,” said one senior US defence official.
But the official said China may also see the lower tensions across the Taiwan Strait as an opportunity to shift their focus.
“Some in the Chinese military did not believe that the soft policy of [President] Hu Jintao would work, because they felt they needed Taiwan as a justification for continued military spending, but it is working and so now they need a new rationale.”
China hawks within the US military are often accused of using the rise of China as a pretext to justify increased funding for weapons such as the F-22 fighter jet. Much in the same manner, some US experts argue that the PLA navy has learned a trick from the Pentagon playbook, and is using the increased tensions in the South China Sea as justification for its own funding during a tight economic environment.
While lower tensions with Taiwan may have provided some space for the Chinese military, Mr Ott says the overall geopolitical landscape has shifted in a way that has prompted China to change its strategy. He says China has been playing “defence” in Northeast Asia, but now sees opportunity in south-east Asia which is the “soft underbelly”.
“The traditional historic strategic threats – Russia and Japan – are off the board so China is free for the first time since the Ming dynasty to be proactively assertive in terms of their interests and they see those interests primarily through to the south,” says Mr Ott.
“What the Chinese see in Southeast Asia is a natural sphere of influence,” says Mr Ott. “This is China’s Central America. They want to push US military power out of their backyard.”
To contact the reporter, email demetri.sevastopulo@ft.com
‘More Chinese missiles’ in Taiwan Strait
By Demetri Sevastopulo in Washington
Copyright The Financial Times Limited 2009
Published: March 25 2009 18:50 | Last updated: March 25 2009 23:19
http://www.ft.com/cms/s/0/4a5104aa-196c-11de-9d34-0000779fd2ac.html
China deployed more missiles across the Taiwan Strait during the past year in spite of a decline in tensions since a new Taiwanese president was elected, the Pentagon said on Wednesday.
In its annual report on the Chinese military, the US defence department said China was “rapidly developing coercive capabilities” to deter Taiwan – which Beijing considers a renegade province – from seeking de jure independence.
“These same capabilities could in the future be used to pressure Taiwan toward a settlement of the cross-strait dispute on Beijing’s terms while simultaneously attempting to deter, delay or deny any possible US support for the island in case of conflict,” the report said.
“This modernisation and the threat to Taiwan continue despite significant reduction in cross-strait tension over the last year since Taiwan elected a new president.”
The report, mandated by the US Congress, comes just a few weeks after an incident in the South China Sea in which five Chinese naval, fisheries and fishing ships harassed the USNS Impeccable, a US navy ship used for detecting submarines. Defence experts say the Chinese navy is increasingly trying to challenge the US Seventh Fleet, which has long been the dominant naval power in the region.
Hawks in the US are concerned that China is expanding the capabilities of its military to become more aggressive in Asia and elsewhere.
Other officials say it is natural for China to develop its military as it grows into a big power, but they have concerns about a lack of transparency.
“There are legitimate reasons for them to grow a ‘blue water’ navy, mostly to help the rest of us to ensure the stability and prosperity of this globalised world of ours,” said one US defence official. “So we’re okay with that and we want to engage with them going forwards and partner [them] where it makes sense. It’s the other things that they are doing on the way that leaves you baffled, like this incident with the Impeccable.”
Following several days of heated rhetoric, the US and China have attempted to ratchet down the tensions. The US sent a destroyer to protect the Impeccable, but the White House was later annoyed that the Pentagon revealed the move to avoid the perception that the US was trying to escalate the incident.
While the Chinese military budget has benefited from double-digit growth for years, the Pentagon said the People’s Liberation Army still had “limited” ability to sustain military power at a distance. But it said the Chinese continued to develop “disruptive technologies”, such as missiles that would hinder adversaries from entering a battle zone, that “are changing regional military balances and that have implications beyond the Asia-Pacific region”.
Disruptive technologies are products or processes that marginalise older technologies. In the military, cyber warfare can disable computer-based weapons systems. In 2007, China destroyed one of its weather satellites in space with a kinetic weapon, leading to concerns in the US about the safety of its surveillance and communications satellites.
The Pentagon said China’s lack of transparency on its military spending and capabilities “poses risks to stability by creating uncertainty and increasing the potential for misunderstanding and miscalculation”.
Additional reporting by agencies.
Tuesday, March 24, 2009
Hospira to cut 1,450 jobs, 10% of work force/IBM set to lay off 5,000 in North America
Hospira to cut 1,450 jobs, 10% of work force
By James P. Miller
Copyright © 2009, Chicago Tribune
8:21 AM CDT, March 24, 2009
http://www.chicagotribune.com/business/chi-biz-hospira-job-cuts-hsp-march24,0,4608558.story
Hospira Inc. outlined a reorganization plan that will eliminate one out of every 10 jobs at the Lake Forest specialty pharmaceutical and medication-delivery concern.
Based on the 14,500-person workforce Hospira listed in a recent regulatory filing, the makeover initiative Hospira refers to as "Project Fuel" promises to cut 1,450 positions during the next two years, most within the first 12 months. A spokesperson said only about 150 of the jobs being eliminted are in the Chicago region.
Hospira said it expects the initiative to yield annual savings of $110 million to as much as $140 million once it is fully implemented. But it will also generate a total of $140 million to $160 million in one-time pretax charges, the company noted.
Chairman and Chief Executive Officer Christopher Begley said the company is taking "a number of important steps to simplify our business, strengthen our financial position and establish a strong foundation for our future."
Reducing costs and improving efficiencies through the new initiative, he said, will "free up more dollars to invest for profitable growth and shareholder returns."
Among other actions, the new project calls for Hospira to streamline its product line, focusing what the company describes as an overly complex line of offerings that sometimes duplicates the same drug compound choices in a confusing fashion.
Hospira also said it is looking for ways to shed non-core assets that show less growth than the company's flagship specialty injectable pharmaceuticals and medication management systems product lines. Without providing details, Hospira said that beyond those two key segments, it will be "rationalizing non-strategic assets that detract from the company's overall growth trajectory and margin expansion opportunities."
It will also "streamline" its organizational structure to boost efficiency, with key targets including its procurement, finance and information-technology operations.
jpmiller@tribune.com
IBM set to lay off 5,000 in North America
By Joseph Menn in San Francisco
Copyright The Financial Times Limited 2009
Published: March 26 2009 00:21 | Last updated: March 26 2009 00:21
http://www.ft.com/cms/s/0/e70a378a-1999-11de-9d34-0000779fd2ac.html
IBM, which has the largest workforce in the US technology sector, is set to lay off about 5,000 staff in its North America operations. Employees are expected to be told of the cuts on Tuesday.
IBM declined to comment on the job losses, which were confirmed by a person familiar with the company’s plans.
The group has more than 100,000 staff on its payroll. IBM executives indicated recently that it would eliminate more jobs in the first half of 2009 than in the second half.
IBM, which which has been hit by slower technology spending in the US as the downturn bites, now earns around two-thirds of its revenue overseas and has been expanding its workforce in emerging markets including China and India.
Many of the cuts are likely to come in the global services division, which has been a consistent source of profits at Big Blue as the fortunes have fluctuated at other divisions.
IBM has been pushing to provide support contracts to clients from bases in India and other lower-cost countries.
Elsewhere, IBM is seeking new business. It is in talks to acquire Silicon Valley server and software company Sun Microsystems for about $6.5bn in cash, in what would be IBM’s largest takeover.
IBM recently announced that fourth-quarter profits rose 12 per cent to $4.43bn.
In the most recent quarter, global business services revenue was flat, at $4.7bn after currency adjustments.
The technology services business fared better, rising 3 per cent to $9.6bn. But the combined services business saw new short-term contract signings dip 1 per cent.
Once known mainly for its largest computers, IBM has steadily diversified, building up first software and then services and expanding beyond core technology expertise. It is the second largest software supplier in the world and the largest IT services firm.
That strategy has helped the company, and outsourcing to contract employees has risen by 20 per cent. Higher-priced consulting can be axed quickly by customers looking to save.
Total revenue in the fourth quarter declined 1 per cent to $27bn, again adjusting for currency shifts.
IBM shares fell 0.42 per cent to close at $97.95 on the New York Stock Exchange.
By James P. Miller
Copyright © 2009, Chicago Tribune
8:21 AM CDT, March 24, 2009
http://www.chicagotribune.com/business/chi-biz-hospira-job-cuts-hsp-march24,0,4608558.story
Hospira Inc. outlined a reorganization plan that will eliminate one out of every 10 jobs at the Lake Forest specialty pharmaceutical and medication-delivery concern.
Based on the 14,500-person workforce Hospira listed in a recent regulatory filing, the makeover initiative Hospira refers to as "Project Fuel" promises to cut 1,450 positions during the next two years, most within the first 12 months. A spokesperson said only about 150 of the jobs being eliminted are in the Chicago region.
Hospira said it expects the initiative to yield annual savings of $110 million to as much as $140 million once it is fully implemented. But it will also generate a total of $140 million to $160 million in one-time pretax charges, the company noted.
Chairman and Chief Executive Officer Christopher Begley said the company is taking "a number of important steps to simplify our business, strengthen our financial position and establish a strong foundation for our future."
Reducing costs and improving efficiencies through the new initiative, he said, will "free up more dollars to invest for profitable growth and shareholder returns."
Among other actions, the new project calls for Hospira to streamline its product line, focusing what the company describes as an overly complex line of offerings that sometimes duplicates the same drug compound choices in a confusing fashion.
Hospira also said it is looking for ways to shed non-core assets that show less growth than the company's flagship specialty injectable pharmaceuticals and medication management systems product lines. Without providing details, Hospira said that beyond those two key segments, it will be "rationalizing non-strategic assets that detract from the company's overall growth trajectory and margin expansion opportunities."
It will also "streamline" its organizational structure to boost efficiency, with key targets including its procurement, finance and information-technology operations.
jpmiller@tribune.com
IBM set to lay off 5,000 in North America
By Joseph Menn in San Francisco
Copyright The Financial Times Limited 2009
Published: March 26 2009 00:21 | Last updated: March 26 2009 00:21
http://www.ft.com/cms/s/0/e70a378a-1999-11de-9d34-0000779fd2ac.html
IBM, which has the largest workforce in the US technology sector, is set to lay off about 5,000 staff in its North America operations. Employees are expected to be told of the cuts on Tuesday.
IBM declined to comment on the job losses, which were confirmed by a person familiar with the company’s plans.
The group has more than 100,000 staff on its payroll. IBM executives indicated recently that it would eliminate more jobs in the first half of 2009 than in the second half.
IBM, which which has been hit by slower technology spending in the US as the downturn bites, now earns around two-thirds of its revenue overseas and has been expanding its workforce in emerging markets including China and India.
Many of the cuts are likely to come in the global services division, which has been a consistent source of profits at Big Blue as the fortunes have fluctuated at other divisions.
IBM has been pushing to provide support contracts to clients from bases in India and other lower-cost countries.
Elsewhere, IBM is seeking new business. It is in talks to acquire Silicon Valley server and software company Sun Microsystems for about $6.5bn in cash, in what would be IBM’s largest takeover.
IBM recently announced that fourth-quarter profits rose 12 per cent to $4.43bn.
In the most recent quarter, global business services revenue was flat, at $4.7bn after currency adjustments.
The technology services business fared better, rising 3 per cent to $9.6bn. But the combined services business saw new short-term contract signings dip 1 per cent.
Once known mainly for its largest computers, IBM has steadily diversified, building up first software and then services and expanding beyond core technology expertise. It is the second largest software supplier in the world and the largest IT services firm.
That strategy has helped the company, and outsourcing to contract employees has risen by 20 per cent. Higher-priced consulting can be axed quickly by customers looking to save.
Total revenue in the fourth quarter declined 1 per cent to $27bn, again adjusting for currency shifts.
IBM shares fell 0.42 per cent to close at $97.95 on the New York Stock Exchange.
Al Baskin Co.: Owner of Mark Shale stores files for bankruptcy - Out-of-state stores to close; 3 in Chicago area to remain open
Al Baskin Co.: Owner of Mark Shale stores files for bankruptcy - Out-of-state stores to close; 3 in Chicago area to remain open
By Sandra M. Jones
Copyright © 2009, Chicago Tribune
March 24, 2009
http://www.chicagotribune.com/business/chi-tue-mark-shale-bankruptcy-mar24,0,1122535.story
The family-owned operator of Mark Shale stores filed for Chapter 11 bankruptcy protection Monday, citing a "dramatic revenue decline" amid the worst retail environment in decades.
The Al Baskin Co., the 80-year-old Woodridge-based retailer, is keeping open three Chicago-area full-price stores as it seeks a buyer for its Chicago operations and Internet business. It closed its outlet store on Elston Avenue in Chicago on Monday and plans to shutter all of its stores in Dallas, Kansas City, St. Louis and Atlanta in April.
Mark Shale, a purveyor of high-end suits and sportswear for men and women, has been a fixture on North Michigan Avenue since 1981. It also operates stores in Northbrook and Oak Brook.
Luxury retailers, typically immune to economic turmoil, have been especially hard hit by this recession as well-to-do customers see their net worth plummet. As customers watched their stock portfolios fall in half, they stopped shopping, said Scott Baskin, co-president and grandson of the company's founder.
"We just got caught in the tsunami of this economy," Baskin said.
Sales declined 30 percent over the holidays, and then tumbled up to 50 percent in recent weeks, Baskin said.
With eight stores and about $50 million in annual sales, Mark Shale didn't have the girth of a big department store to have the leverage with its vendors, yet it wasn't small enough to quickly cut overhead costs like a single boutique can do, he said.
Al Baskin was founded in 1929 in Joliet. The company expanded to the Chicago market in the 1970s and changed the name of its stores to Mark Shale to avoid confusion with the Baskin stores then operated by Hartmarx Corp.
Al Baskin went through Chapter 11 in 1995 after taking on debt to expand, and it emerged in 1997 as a smaller entity.
Al Baskin employs more than 380 people, including 250 in the Chicago area. There will be layoffs at headquarters as it reorganizes, Baskin said.
smjones@tribune.com
By Sandra M. Jones
Copyright © 2009, Chicago Tribune
March 24, 2009
http://www.chicagotribune.com/business/chi-tue-mark-shale-bankruptcy-mar24,0,1122535.story
The family-owned operator of Mark Shale stores filed for Chapter 11 bankruptcy protection Monday, citing a "dramatic revenue decline" amid the worst retail environment in decades.
The Al Baskin Co., the 80-year-old Woodridge-based retailer, is keeping open three Chicago-area full-price stores as it seeks a buyer for its Chicago operations and Internet business. It closed its outlet store on Elston Avenue in Chicago on Monday and plans to shutter all of its stores in Dallas, Kansas City, St. Louis and Atlanta in April.
Mark Shale, a purveyor of high-end suits and sportswear for men and women, has been a fixture on North Michigan Avenue since 1981. It also operates stores in Northbrook and Oak Brook.
Luxury retailers, typically immune to economic turmoil, have been especially hard hit by this recession as well-to-do customers see their net worth plummet. As customers watched their stock portfolios fall in half, they stopped shopping, said Scott Baskin, co-president and grandson of the company's founder.
"We just got caught in the tsunami of this economy," Baskin said.
Sales declined 30 percent over the holidays, and then tumbled up to 50 percent in recent weeks, Baskin said.
With eight stores and about $50 million in annual sales, Mark Shale didn't have the girth of a big department store to have the leverage with its vendors, yet it wasn't small enough to quickly cut overhead costs like a single boutique can do, he said.
Al Baskin was founded in 1929 in Joliet. The company expanded to the Chicago market in the 1970s and changed the name of its stores to Mark Shale to avoid confusion with the Baskin stores then operated by Hartmarx Corp.
Al Baskin went through Chapter 11 in 1995 after taking on debt to expand, and it emerged in 1997 as a smaller entity.
Al Baskin employs more than 380 people, including 250 in the Chicago area. There will be layoffs at headquarters as it reorganizes, Baskin said.
smjones@tribune.com
Consider This: NPR Achieves Record Ratings
Consider This: NPR Achieves Record Ratings
By Paul Farhi
Copyright by The Washington Post
Tuesday, March 24, 2009; Page C01
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/23/AR2009032302972.html?hpid=topnews
At a time when newspapers, magazines and TV news continue to lose readers and viewers, at least one part of the traditional media has continued to grow robustly: National Public Radio.
The audience for NPR's daily news programs, including "Morning Edition" and "All Things Considered," reached a record last year, driven by widespread interest in the presidential election, and the general decline of radio news elsewhere. Washington-based NPR will release new figures to its stations today showing that the cumulative audience for its daily news programs hit 20.9 million a week, a 9 percent increase over the previous year.
The weekly audience for all the programming fed by Washington-based NPR -- including talk shows and music -- also reached a record last year, with 23.6 million people tuning in each week, an 8.7 percent increase over 2007.
While almost every news organization saw its audience spike during the political campaign last year, NPR's surge continues a trend that goes back to at least the fall of 2000, when the organization began aggregating audience data from hundreds of affiliated public stations across the country. NPR saw a big audience increase after the terrorist attacks of Sept. 11, 2001, and has added listeners since. Its audience has grown 47 percent since 2000, according to figures from Arbitron.
"When people discover us, they seem to discover us for good," Ellen Weiss, NPR's senior vice president for news, said in an interview yesterday. "They stay with us."
More than half of NPR's daily audience comes from its two "core" news shows, "Morning Edition" and the evening "All Things Considered." "Morning Edition's" average daily audience, 7.6 million, is now about 60 percent larger than the audience for "Good Morning America" on ABC and about one-third larger than the audience for the "Today" show on NBC.
The favorable audience data, however, hasn't spared NPR from the budget woes that are affecting almost every news organization in the nation.
In December, NPR cut 7 percent of its news staff and eliminated two daily newsmagazine programs, "Day to Day" and "News & Notes." Last week, NPR said its top managers, including its new chief executive, Vivian Schiller, will not be paid for the last two weeks of this year. It will also suspend retirement contributions for these managers, and it dropped some office newspaper subscriptions.
The cuts still leave NPR with a projected budget gap of $8 million this year, based on expenditures of about $160 million, according to Dana Davis Rehm, senior vice president of marketing. Rehm said more cuts are imminent but declined to specify where they will be made, pending an announcement later this spring.
NPR faces declining funding from all its major sources: corporate underwriters that give money in exchange for on-air mentions, charitable foundations and annual dues from almost 900 member stations. Many NPR member stations have announced staff cutbacks of their own in the face of declining listener contributions and other revenue.
"It would be a dangerous correlation to say there's a direct relationship between the size of our audience and our revenue," said Schiller, who took over as CEO in January. "But the fact that we have such a large and loyal audience means that when we come out of this economic slump, we'll continue to be strong. I wish I felt the same way about my brethren in the rest of the media."
NPR remains a powerhouse in its home town. WAMU (88.5 FM), which carries NPR news and talk programs throughout the day, has consistently ranked as the region's second-most-popular station, behind all-news WTOP (103.5 FM), a commercial station. Noncommercial WETA (90.9 FM), which has a classical music format but also carries NPR news, is among the area's 10 most popular stations.
NPR's rising popularity reflects the decline of news as a radio format, said Mark Jurkowitz, associate director of the Project for Excellence in Journalism, a Washington think tank. Producing an original newscast is expensive, especially compared with playing music or airing syndicated talk shows; many radio companies have pared back or eliminated their news departments as the industry has consolidated over the past decade. "Local news stations have slowly but steadily vanished in a lot of cities," said Jurkowitz.
One strength of NPR, he said, is its original foreign reporting -- something that is now largely unavailable elsewhere on the radio. The organization maintains 18 foreign bureaus, more than any of the major broadcast TV networks.
Its reports from abroad, he said, are a magnet "for a lot of people who weren't necessarily born in this country who may see NPR as the one place to get news about parts of the world they care about."
By Paul Farhi
Copyright by The Washington Post
Tuesday, March 24, 2009; Page C01
http://www.washingtonpost.com/wp-dyn/content/article/2009/03/23/AR2009032302972.html?hpid=topnews
At a time when newspapers, magazines and TV news continue to lose readers and viewers, at least one part of the traditional media has continued to grow robustly: National Public Radio.
The audience for NPR's daily news programs, including "Morning Edition" and "All Things Considered," reached a record last year, driven by widespread interest in the presidential election, and the general decline of radio news elsewhere. Washington-based NPR will release new figures to its stations today showing that the cumulative audience for its daily news programs hit 20.9 million a week, a 9 percent increase over the previous year.
The weekly audience for all the programming fed by Washington-based NPR -- including talk shows and music -- also reached a record last year, with 23.6 million people tuning in each week, an 8.7 percent increase over 2007.
While almost every news organization saw its audience spike during the political campaign last year, NPR's surge continues a trend that goes back to at least the fall of 2000, when the organization began aggregating audience data from hundreds of affiliated public stations across the country. NPR saw a big audience increase after the terrorist attacks of Sept. 11, 2001, and has added listeners since. Its audience has grown 47 percent since 2000, according to figures from Arbitron.
"When people discover us, they seem to discover us for good," Ellen Weiss, NPR's senior vice president for news, said in an interview yesterday. "They stay with us."
More than half of NPR's daily audience comes from its two "core" news shows, "Morning Edition" and the evening "All Things Considered." "Morning Edition's" average daily audience, 7.6 million, is now about 60 percent larger than the audience for "Good Morning America" on ABC and about one-third larger than the audience for the "Today" show on NBC.
The favorable audience data, however, hasn't spared NPR from the budget woes that are affecting almost every news organization in the nation.
In December, NPR cut 7 percent of its news staff and eliminated two daily newsmagazine programs, "Day to Day" and "News & Notes." Last week, NPR said its top managers, including its new chief executive, Vivian Schiller, will not be paid for the last two weeks of this year. It will also suspend retirement contributions for these managers, and it dropped some office newspaper subscriptions.
The cuts still leave NPR with a projected budget gap of $8 million this year, based on expenditures of about $160 million, according to Dana Davis Rehm, senior vice president of marketing. Rehm said more cuts are imminent but declined to specify where they will be made, pending an announcement later this spring.
NPR faces declining funding from all its major sources: corporate underwriters that give money in exchange for on-air mentions, charitable foundations and annual dues from almost 900 member stations. Many NPR member stations have announced staff cutbacks of their own in the face of declining listener contributions and other revenue.
"It would be a dangerous correlation to say there's a direct relationship between the size of our audience and our revenue," said Schiller, who took over as CEO in January. "But the fact that we have such a large and loyal audience means that when we come out of this economic slump, we'll continue to be strong. I wish I felt the same way about my brethren in the rest of the media."
NPR remains a powerhouse in its home town. WAMU (88.5 FM), which carries NPR news and talk programs throughout the day, has consistently ranked as the region's second-most-popular station, behind all-news WTOP (103.5 FM), a commercial station. Noncommercial WETA (90.9 FM), which has a classical music format but also carries NPR news, is among the area's 10 most popular stations.
NPR's rising popularity reflects the decline of news as a radio format, said Mark Jurkowitz, associate director of the Project for Excellence in Journalism, a Washington think tank. Producing an original newscast is expensive, especially compared with playing music or airing syndicated talk shows; many radio companies have pared back or eliminated their news departments as the industry has consolidated over the past decade. "Local news stations have slowly but steadily vanished in a lot of cities," said Jurkowitz.
One strength of NPR, he said, is its original foreign reporting -- something that is now largely unavailable elsewhere on the radio. The organization maintains 18 foreign bureaus, more than any of the major broadcast TV networks.
Its reports from abroad, he said, are a magnet "for a lot of people who weren't necessarily born in this country who may see NPR as the one place to get news about parts of the world they care about."
International Herald Tribune Editorial: President Obama flinches on immigration
International Herald Tribune Editorial: President Obama flinches on immigration
Copyright by The International Herald Tribune
Published: March 24, 2009
http://www.iht.com/articles/2009/03/24/opinion/edimmig.php
In a little-noticed act of political faintheartedness, the Obama administration has pulled back from nominating Thomas Saenz, a highly regarded civil-rights lawyer and counsel to the mayor of Los Angeles, to run the Justice Department’s civil rights division. Mr. Saenz, the former top litigator in Los Angeles for the Mexican American Legal Defense and Educational Fund, or Maldef, was privately offered the job in January.
The floating of his name led to fierce outbursts from anti-immigrant groups and blogs, which detest him for being so good at what he does. He was a leader of the successful fight to block California’s Proposition 187, an unconstitutional effort to deny social services and schooling to illegal immigrants. He has defended Latino day laborers who were targets of misguided local crackdowns, from illegal police stings to unconstitutional anti-solicitation ordinances.
The resistance was apparently too much for the White House. Mr. Saenz was ditched in favor of Maryland’s labor secretary, Thomas Perez, who has a solid record but is not as closely tied to immigrant rights.
Immigrant advocates are stuck with the sinking feeling that Mr. Obama’s supposed enthusiasm for immigration reform will wilt under pressure and heat. Representative Luis Gutiérrez of Illinois, a member of the Congressional Hispanic Caucus, found it sadly unsurprising that a lawyer could be rejected for the nation’s top civil-rights job because he had stood up for civil rights. “In what other position do you find that your life experience, your educational knowledge and commitment to an issue actually hurts you?” he asked.
Mr. Obama may have avoided a nasty fight this time. But if he is ever going to win the battle to put 12 million illegal immigrants on a path to citizenship, he will to have to confront and dismantle the core restrictionist argument: that being an illegal immigrant is an unpardonable crime.
The suffering that illegal immigrants endure, from raids to workplace exploitation to mistreatment in detention, is a civil-rights crisis. It cannot be left to fester while we wait for the big immigration bill that may or may not arrive under this president.
Copyright by The International Herald Tribune
Published: March 24, 2009
http://www.iht.com/articles/2009/03/24/opinion/edimmig.php
In a little-noticed act of political faintheartedness, the Obama administration has pulled back from nominating Thomas Saenz, a highly regarded civil-rights lawyer and counsel to the mayor of Los Angeles, to run the Justice Department’s civil rights division. Mr. Saenz, the former top litigator in Los Angeles for the Mexican American Legal Defense and Educational Fund, or Maldef, was privately offered the job in January.
The floating of his name led to fierce outbursts from anti-immigrant groups and blogs, which detest him for being so good at what he does. He was a leader of the successful fight to block California’s Proposition 187, an unconstitutional effort to deny social services and schooling to illegal immigrants. He has defended Latino day laborers who were targets of misguided local crackdowns, from illegal police stings to unconstitutional anti-solicitation ordinances.
The resistance was apparently too much for the White House. Mr. Saenz was ditched in favor of Maryland’s labor secretary, Thomas Perez, who has a solid record but is not as closely tied to immigrant rights.
Immigrant advocates are stuck with the sinking feeling that Mr. Obama’s supposed enthusiasm for immigration reform will wilt under pressure and heat. Representative Luis Gutiérrez of Illinois, a member of the Congressional Hispanic Caucus, found it sadly unsurprising that a lawyer could be rejected for the nation’s top civil-rights job because he had stood up for civil rights. “In what other position do you find that your life experience, your educational knowledge and commitment to an issue actually hurts you?” he asked.
Mr. Obama may have avoided a nasty fight this time. But if he is ever going to win the battle to put 12 million illegal immigrants on a path to citizenship, he will to have to confront and dismantle the core restrictionist argument: that being an illegal immigrant is an unpardonable crime.
The suffering that illegal immigrants endure, from raids to workplace exploitation to mistreatment in detention, is a civil-rights crisis. It cannot be left to fester while we wait for the big immigration bill that may or may not arrive under this president.
Nine who got biggest bonuses at A.I.G. pledge to give them back
Nine who got biggest bonuses at A.I.G. pledge to give them back
By Mary Williams Walsh and Carl Hulse
Copyright by The International Herald Tribune
Published: March 24, 2009
http://www.iht.com/articles/2009/03/24/business/bonus.php
NEW YORK: The New York State attorney general, Andrew M. Cuomo, said he had persuaded nine of the top 10 bonus recipients at the American International Group to give the money back, as the Senate retreated on plans to tax such bonuses.
Mr. Cuomo said Monday that he was working his way down a list of the insurer's employees, ranked by the size of their bonuses, and had already won commitments to pay back $50 million out of the total $165 million awarded this month. But in a reversal of the stand he took last week, he said he did not intend to release any names.
"If the person returns the mon
By Mary Williams Walsh and Carl Hulse
Copyright by The International Herald Tribune
Published: March 24, 2009
http://www.iht.com/articles/2009/03/24/business/bonus.php
NEW YORK: The New York State attorney general, Andrew M. Cuomo, said he had persuaded nine of the top 10 bonus recipients at the American International Group to give the money back, as the Senate retreated on plans to tax such bonuses.
Mr. Cuomo said Monday that he was working his way down a list of the insurer's employees, ranked by the size of their bonuses, and had already won commitments to pay back $50 million out of the total $165 million awarded this month. But in a reversal of the stand he took last week, he said he did not intend to release any names.
"If the person returns the mon