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Wednesday, July 02, 2008

Free Internet Press Newsletter - Wednesday July 2 2008 - (813)

Wednesday July 2 2008 edition
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More Than 900 Cases Alleging Fraud By Government Contractors, Drugmakers Getting Nowhere
2008-07-02 03:09:34

More than 900 cases alleging that government contractors and drugmakers have defrauded taxpayers out of billions of dollars are languishing in a backlog that has built up over the past decade because the Justice Department cannot keep pace with the surge in charges brought by whistle-blowers, according to lawyers involved in the disputes.

The issue is drawing renewed interest among lawmakers and nonprofit groups because many of the cases involve the wars in Iraq and Afghanistan, rising health-care payouts, and privatization of government functions - all of which offer rich new opportunities to swindle taxpayers.

Since 2001, 300 to 400 civil cases have been filed each year by employees charging that their companies defrauded the government. But under the cumbersome process that governs these cases, Justice Department lawyers must review them under seal, and whistle-blowers routinely wait 14 months or longer just to learn whether the department will get involved. The government rejects about three-quarters of the cases it receives, saying that the vast majority have little merit.

Disputes can stay buried for years more while the government investigates the allegations.

"Even if no new cases are filed, it might take 10 years for the Department of Justice to clear its desk. Cases in the backlog represent a lot of money being left on the table," said Patrick Burns, a spokesman for Taxpayers Against Fraud, which advocates for Justice to receive more funding to support cases by whistle-blowers and their attorneys.

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Deepening Cycle Of U.S. Job Losses Could Last Into 2009
2008-07-02 03:09:12

As automakers dropped their latest batch of awful sales numbers on the market on Tuesday, reinforcing the gloom spreading across the economy, the troubles confronting American workers seemed to intensify.

Plummeting home prices have in recent months eliminated jobs for hundreds of thousands of people, from bankers and real estate agents to construction workers and furniture manufacturers. Tighter lending standards imposed by banks in the wake of huge mortgage losses have made it hard for many Americans to secure credit - the lifeblood of expansion in recent years - crimping the appetite of consumers, whose spending amounts to 70 percent of the economy.

Joblessness has accelerated, and employers have slashed working hours even for those on their payrolls, shrinking the size of paychecks just as workers need them the most.

Now, add to that unsavory mix the word from automakers that sales plunged in June - by 28 percent for Ford, 21 percent for Toyota and 18 percent for General Motors - a sharp sign that consumers are pulling back, making manufacturers more likely to cut production and impose more layoffs. Until recently, the weak labor market has been marked more by the reluctance of employers to create new jobs than by mass layoffs.

Among economists, the sense is broadening that the troubles dogging the economy will be stubborn, leaving in place an uncomfortable combination of tight credit and scant job opportunities perhaps well into next year.

“It’s a slow-motion recession,” said Ethan Harris, chief United States economist for Lehman Brothers. “In a normal recession, things kind of collapse and get so weak that you have nowhere to go but up. But we’re not getting the classic two or three negative quarters. Instead, we’re expecting two years of sub-par growth. Growth that’s not enough to generate jobs. It’s kind of a chronic rather than an acute pain.”

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U.S. Supreme Court's Weighing Of Death Penalty In Child Rape Case Contained Factual Error
2008-07-02 03:08:25
When the U.S. Supreme Court ruled last week that the death penalty for raping a child was unconstitutional, the majority noted that a child rapist could face the ultimate penalty in only six states - not in any of the 30 other states that have the death penalty, and not under the jurisdiction of the federal government either.

This inventory of jurisdictions was a central part of the court’s analysis, the foundation for Justice Anthony M. Kennedy's  conclusion in his majority opinion that capital punishment for child rape was contrary to the “evolving standards of decency” by which the court judges how the death penalty is applied.

It turns out that Justice Kennedy’s confident assertion about the absence of federal law was wrong.

A military law blog pointed out over the weekend that Congress, in fact, revised the sex crimes section of the Uniform Code of Military Justice in 2006 to add child rape to the military death penalty. The revisions were in the National Defense Authorization Act that year. President Bush signed that bill into law and then, last September, carried the changes forward by issuing Executive Order 13447, which put the provisions into the 2008 edition of the Manual for Courts-Martial.

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Aussie Charity Used 'Terror' Group To Distribute Aid In Gaza
2008-07-02 03:06:52
A Sydney charity has admitted channeling into the Palestinian Territories through an Islamic organization banned by Australia and the U.S. for its alleged links to terrorism.

Muslim Aid Australia (MAA) has used Interpal - an organization proscribed by former Australian foreign affairs minister Alexander Downer and declared a "specially designated global terrorist" organization by U.S. President George W. Bush in 2003 - to distribute medical aid in Gaza.

Interpal is a British-based humanitarian group also known as the Palestinian Relief and Development Fund. It has been cleared of terror links by the British Charity Commission but failed three years ago to have its proscribed listing revoked in Australia, when lawyers for the group unsuccessfully petitioned Downer.

When informed of MAA's relationship with Interpal, the Department of Foreign Affairs indicated it might refer the case for investigation. The Australian Federal Police Monday night refused to confirm or deny whether inquiries were already under way.

It is a criminal offense under the Charter of the United Nations Act for Australian individuals or organizations to deal with groups identified by DFAT's Consolidated List, which names banned groups and people. Breaching the act can result in a maximum 10-year prison sentence and fines of more than $275,000 for individuals and more than $1.1 million for organizations, DFAT says.

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BP Edged Further Out Of Russia As Visas Are Refused
2008-07-01 20:27:43

The future of BP in Russia was in doubt last night after its joint oil venture TNK-BP confirmed that its chief executive, Bob Dudley, and all international staff would have to leave Russia this month.

The decision by Moscow officials not to renew Dudley's visa follows a bitter battle between BP and its Russian partners that could see a group of oligarchs led by Mikhail Fridman and Viktor Vekselberg seize operational control of TNK-BP.

Britain Prime Minister Gordon Brown is expected to raise the issue in wider talks on energy security when he meets the new Russian president, Dmitry Medvedev, at the G8 summit in Japan next week. Brown's predecessor, Tony Blair, had a row with Vladimir Putin at the last G8 summit and Anglo-Russian relations have been deteriorating since then.

With BP struggling to rebuild a reputation hit by problems in the U.S. and TNK-BP making up a quarter of its stagnating output, the British firm can ill afford to lose its influence and possible ownership of such vital assets. "We can't say the Russian half has won but they are close to winning," said Konstantin Cherepanov, an analyst with the Moscow brokerage KIT Finance.

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After Huge Protests, China Police Reopen Investigation Into Girl's Death
2008-07-01 20:27:19

Chinese police have reopened an investigation into the death of a teenage girl after rumors of a cover-up sparked a riot and huge protests in southwest China over the weekend.

Officials accused gangsters and others with ulterior motives of whipping up local residents' anger, warning that such offenders faced strict punishment.

The state news agency, Xinhua, said Monday around 30,000 people took part in the riot in Weng'an county, Guizhou province. Government offices and police vehicles were set afire.

The protests followed the death of Li Shufen, whose body was pulled from a river on June 22. Her relatives allege she was raped and murdered by a group of men, one of whom is related to a senior local official, but the police ruled that she had committed suicide.

Passions became further inflamed after the girl's uncle Li Xiuzhong was badly beaten in the street by unidentified men, following his confrontations with the police. His current whereabouts are unknown, following his transfer from the county hospital.

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U.S. Car Sales Take A Dive In June
2008-07-01 20:26:21

U.S. car sales plunged in June, dragged down by high fuel prices and a weak economy, but General Motors held onto its traditional lead in domestic sales by recording a smaller decline than Toyota, according to figures released Tuesday.

GM reported selling 262,329 vehicles in June, a drop of 18.2 percent. Toyota sold 193,234 vehicles, down 21.4 percent. Ford Motor Co.recorded an even sharper decline in total sales: about 28 percent. Honda was the only automaker to report increased U.S. sales, a gain of 1.1 percent from a year ago.

For the first half of this year, GM's sales were down 16.3 percent compared with the first half of 2007, Toyota's were off 6.8 percent and Ford's were down 14 percent.

Toyota's decline came as something of a surprise, since its lineup features smaller fuel-efficient cars, gas-electric hybrids and crossover vehicles. The Japanese automaker reported today that its U.S. car sales declined 9.4 percent in June and its truck sales plummeted 38.9 percent.

Toyota last year overtook Ford for second place in the U.S. auto market, and the company captured the top spot in global sales from General Motors in the first quarter of this year. It had been expected to pass GM in monthly U.S. sales for the first time in June, but its steep decline caused it to fall short.

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Mexico In Uproar Over 'Torture' Videos
2008-07-01 20:25:35
Videos showing Leon police practicing torture techniques on a fellow officer and dragging another through vomit at the instruction of a U.S. adviser created an uproar Tuesday in Mexico, which has struggled to eliminate torture in law enforcement.

Two of the videos - broadcast by national television networks and displayed on newspaper Internet sites - showed what Leon city Police Chief Carlos Tornero described as training for an elite unit that must face "real-life, high-stress situations", such as kidnapping and torture by organized crime groups.

Many Mexicans, however, saw a sinister side, especially at a moment when police and soldiers across the country are struggling with scandals over alleged abuses.

"They are teaching police ... to torture!" read the headline in the Mexico City newspaper Reforma.

Human rights investigators in Guanajuato state, where Leon is located, are looking into the tapes, and the National Human Rights Commission also expressed concerned.

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French Army Chief Resigns Over Shootings At Military Show
2008-07-01 20:24:56

The head of the French army has resigned after a shooting at a military show left 17 people injured when real bullets were used instead of blanks, the French president's office said Tuesday.

Officials said Nicolas Sarkozy had accepted the resignation of General Bruno Cuche.

The incident occurred on Sunday during a demonstration of hostage-freeing techniques at the Laperrine military barracks, in southeast France.

Most of those injured were civilians, three of them children. Four people were seriously wounded, including a three-year-old child, although hospital officials said Monday that none of the injuries appeared life-threatening.

Sarkozy pledged "consequences" after the shooting, which is still being investigated.

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At Midyear, U.S. Economic Pain Remains
2008-07-01 05:23:27

Many policy makers and bankers said this credit mess was contained.

Boy, were they wrong. More than a year after the crisis first flared, the financial industry, and with it the broader economy, seems to be caught in a vicious circle.

As home prices sink, people are falling behind on their mortgages in growing numbers. As more homeowners run into trouble, banks must write off even more loans. And as the bad loans mount, financial companies are increasingly unable or unwilling to extend credit, making it even harder to buy homes or expand businesses.

This process is playing out painfully on Wall Street, where on Monday the stock market rounded out its worst 12-month run since the spring of 2003, when the United States invaded Iraq and the market was beginning a tenuous recovery from the bursting of the technology bubble.

The Standard & Poor’s 500-stock index is down 12.8 percent for the first half of the year. The index just had its worst June (down 8.6 percent) since 1930 (down 16.5 percent).

The Dow Jones industrial average is off 14.4 percent for the first half of the year. Financial shares keep falling. Even as the broader market posted a small gain on Monday, shares of banks and brokerage firms in the S.& P. 500 fell 2.1 percent, to a five-year low.

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McCain's Energy Record Is On And Off
2008-07-01 05:23:02
The Republican presidential candidate has swerved from one position to another over the years, taking often contradictory stances on the government's role in energy policy.

Crisscrossing the country over the last two weeks to promote his energy plans, Sen. John McCain promised a forceful national strategy to combat global warming and end U.S. dependence on foreign oil.

"We must steer far clear of the errors and false assumptions that have marked the energy policies of nearly 20 Congresses and seven presidents," the presumptive Republican nominee told a crowd of oil executives in Houston, Texas.

Yet McCain's record of tackling energy policy on Capitol Hill shows little of the clear direction he says would come from a McCain White House.

Instead, the Arizona senator has swerved from one position to another over the years, taking often contradictory stances on the federal government's role in energy policy.
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Ex-Agent Says CIA Ignored Facts On Iran
2008-07-01 05:22:25

A former CIA operative who says he tried to warn the agency about faulty intelligence on Iraqi weapons programs now contends that CIA officials also ignored evidence that Iran had suspended work on a nuclear bomb.

The onetime undercover agent, who has been barred by the CIA from using his real name, filed a motion in federal court late Friday asking the government to declassify legal documents describing what he says was a deliberate suppression of findings on Iran that were contrary to agency views at the time.

The former operative alleged in a 2004 lawsuit that the CIA fired him after he repeatedly clashed with senior managers over his attempts to file reports that challenged the conventional wisdom about weapons of mass destruction in the Middle East. Key details of his claim have not been made public because they describe events the CIA deems secret.

The consensus view on Iran's nuclear program shifted dramatically last December with the release of a landmark intelligence report that concluded that Iran halted work on nuclear weapons design in 2003. The publication of the National Intelligence Estimate on Iran undermined the CIA's rationale for censoring the former officer's lawsuit, said his attorney, Roy Krieger.

"On five occasions he was ordered to either falsify his reporting on WMD in the Near East, or not to file his reports at all," Krieger said in an interview.

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A Ragtag Insurgency Gains An Al-Qaeda Lifeline
2008-07-01 00:51:59
Hiding in the caves and woodlands surrounding the hill-country town of Naciria, Algerian insurgents were all but washed up a few years ago.

Their nationalist battle against the Algerian military was faltering. “We didn’t have enough weapons,” recalled a former militant lieutenant, Mourad Khettab, 34. “The people didn’t want to join. And money, we didn’t have enough money.”

Then the leader of the group, a university mathematics graduate named Abdelmalek Droukdal, sent a secret message to Iraq in the fall of 2004. The recipient was Abu Musab Al-Zarqawi, the leader of al-Qaeda in Mesopotamia, and the two men on opposite ends of the Arab world engaged in what one firsthand observer describes as a corporate merger.

Today, as Islamist violence wanes in some parts of the world, the Algerian militants - renamed al-Qaeda in the Islamic Maghreb - have grown into one of the most potent Osama bin Laden affiliates, reinvigorated with fresh recruits and a zeal for Western targets.

Their gunfights with Algerian forces have evolved into suicide truck bombings of iconic sites like the United Nations  offices in Algiers. They have kidnapped and killed European tourists as their reach expands throughout northern Africa.

Last month, they capped a string of attacks with an operation that evoked the horrors of Iraq: a pair of bombs outside a train station east of Algiers, the second one timed to hit emergency responders. A French engineer and his driver were killed by the first bomb; the second one failed to explode.

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Bear Market Snapping At Wall Street's Ankles
2008-07-01 00:51:24
The Dow Jones industrial average came as close as possible to a bear market in the second quarter without actually falling into one.

Pounded in the final six weeks by the noxious mixture of rising oil prices, falling home values and continued losses in the banking sector, the Dow sank 7.4% in the quarter and finished down 19.9% from its record high last October.

The bulk of the losses struck in June as both the Dow and the Standard & Poor's 500 index suffered their biggest declines for the month since 1930 - the depths of the bear market during the Great Depression.

Though the Dow and other major averages averted the 20% drop that historically has defined a bear market, many on Wall Street are convinced that a bear is underway and that it may be a particularly bruising one given the tangle of problems afflicting the economy.

"The average bear market takes us down 30%," said Peter Boockvar, equity strategist at New York brokerage house Miller Tabak & Co. "If that's just the average we have a way to go. And if you believe this is the worst economic environment in decades, you can even make argument that that maybe we're only halfway there."

The second quarter started on an up note for the stock market as the 11th-hour rescue of Bear Stearns in mid-March raised hope that the global financial system had withstood its biggest threat in decades.
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Campaign Blog: McCain Talks About Upcoming Latin America Trip
2008-07-01 00:50:53
Sen. John McCain spoke at length about his upcoming trip to Latin America and approach to international affairs during a ride on his Straight Talk Express bus to Pipersville, Pennsylvania, Monday.

When asked about why he was going to tout the virtues of free trade abroad at a time when many Americans have grown increasingly skeptical of such agreements, the senator said he had no intention of backing away from such a longstanding commitment.

"You gotta stand on principle. I believe in the principle of free trade," he said, adding that Americans have been ill-served by the unemployment and worker displacement programs that the federal government runs. "It's terrible," he said of the two programs.

McCain said he was determined not to follow the example of President Herbert Hoover, who signed protectionist legislation into law. "We went from a recession into one of the great depressions of our history," he said. "I've got to convince people... that I have a plan to give them the kind of education and training they need."

McCain said he hoped to achieve several goals with his upcoming trip, including thanking the leaders of Colombia and Mexico for their work on the drug trade, and to "pledge my continued cooperation with them." But he added that he would also press them to make further progress.

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Chrysler To Close 1 Plant, Cut Output At Another
2008-07-01 00:49:43
Chrysler said Monday that it would indefinitely close one Missouri plant and cut production at another because of slumping demand for pickup trucks and minivans.

Executives said in a conference call that the automaker would shutter the St. Louis South plant, which makes minivans, effective Oct. 31. The St. Louis North plant, which makes full-size pickups, will be cut from two shifts to one effective Sept. 2.

Auburn Hills, Michigan-based Chrysler said the moves would affect 2,400 jobs. That includes 1,500 at the minivan plant and another 900 at the pickup truck plant, both of which are in Fenton, a St. Louis suburb.

Chrysler President and Vice Chairman Tom LaSorda said the company had no plans to reopen the minivan plant.

"We see no need for the capacity in the future," he said, adding that demand can be handled at another minivan plant in Windsor, Canada.

LaSorda also denied rumors that Chrysler's owner, Cerberus Capital Management, planned to sell the company in pieces: "Hogwash, absolutely not being considered at all."
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U.S. Air Force Finds Lack Security At Nuclear Weapons Storage Sites
2008-07-02 03:09:22

Most overseas storage sites for U.S. nuclear weapons, particularly in Europe, need substantial improvements in physical security measures and the personnel who guard the weapons, according to a newly available Air Force report.

"Most sites require significant additional resources to meet DoD (Department of Defense) security requirements," according to the final report of the Air Force Blue Ribbon Review of Nuclear Weapons Policies and Procedures, completed in February.

The report was made public last week by Hans M. Kristensen, director of the Nuclear Information Project at the Federation of American Scientists,who obtained it under a Freedom of Information Act request.

The report said upgrades are needed in "support buildings, fencing, lighting and security systems" at several European sites. It also cited conscripts who serve only nine months and "unionized security personnel" whom some host countries provide as guards.

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Immigrant Killed In Afghanistan Granted Posthumous U.S. Citizenship
2008-07-02 03:08:38

Dawid Pietrek, a Polish immigrant, couldn't vote, run for public office or obtain a U.S. passport; but he signed up to serve a country that wasn't yet his, and last month he gave his life for that country.

Pfc. Pietrek, 24, of Bensenville, Illinois, was one of four Marines killed by a roadside bomb June 14 in Afghanistan's Farah province. Tuesday, more than 90 mourners gathered at Arlington National Cemetery to celebrate Pietrek's life and honor his sacrifice. He was the 489th member of the military killed in Iraq and Afghanistan to be buried at Arlington.

Pietrek's grave was surrounded by a half-dozen wreaths and floral arrangements and a pair of flags, one American and the other a Marine Corps flag. Mourners dressed in dark suits and dresses stood in contrast to Marines in crisp white hats lined up at the rear of the group.

In an e-mail to family, friends and the Daily Herald of Illinois, Pietrek's mother, Dorota, asked that her son's sacrifice be remembered.

"Thank you for keeping him in your hearts and your minds," she wrote in Polish, according to the Daily Herald.

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Google-Yahoo Ad Deal Is Under Anti-Trust Investigation
2008-07-02 03:08:01

The U.S. Justice Department has opened a formal antitrust investigation into a deal struck last month that would allow Internet titan Google to provide some search advertising for Yahoo, according to sources familiar with the inquiry.

Investigators are planning to demand documents not only from Google and Yahoo, but also from other large companies in the Internet and media industries, said the sources, who spoke on condition of anonymity because the investigation is ongoing.

Google and Yahoo officials have said since the deal's announcement that they would delay its implementation for a voluntary Justice Department review; but a formal investigation signals that the department may have found some cause for concern.

"There is nothing unexpected in the review of this arrangement as structured by the parties and Department of Justice officials," Yahoo said in a statement, expressing confidence that the deal would be good for competition. Officials with Google and the Justice Department declined to comment.

Lawyers familiar with similar investigations said that the kind of legal requests being issued by the Justice Department in this case - "civil investigative demands" - are not used for routine matters.

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Swiss Bank UBS Suffers Another Setback In U.S. Federal Court
2008-07-01 20:27:55
A U.S. federal judge on Tuesday cleared the way for prosecutors to force the Swiss banking giant UBS to turn over the names of wealthy clients as part of an investigation of its offshore private banking practices.

An order signed by Judge Joan A. Lenard of Federal District Court in Miami gives prosecutors and the Inernal Revenue Service (IRS)the authority to request the information. It was unclear whether UBS would turn over the names or appeal the process.

The decision is a setback for UBS, which is struggling to maintain its tradition of Swiss banking secrecy amid the rapidly unfolding investigation. The bank said in an e-mailed statement Tuesday that “UBS looks forward to working with the I.R.S. to address the summons.”

The embattled bank, which is struggling against investor concerns about further write-downs and its ability to retain vital private clients, also announced a major overhaul of its corporate governance rules on Tuesday.

It said it would replace four directors and more clearly separate the responsibilities of the board from those of the executive management to end what some critics called a cozy relationship that had led to the bank’s becoming one of the first and largest casualties of the subprime mortgage turmoil.

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Britain Manufacturing Hit By High Inflation, Weak Demand
2008-07-01 20:27:32

Britain's manufacturing sector contracted last month at the fastest rate since 2001 while factory-gate inflation hit record levels, a survey showed Tuesday.

Output and new orders fell at the sharpest rate for almost a decade, but inflationary pressures also picked up, with raw material costs and factory-gate prices rising at the fastest pace since the series began more than 16 years ago.

Sterling, which had been poised to break through the $2 barrier, fell back to $1.9975 by 10.20am. The FTSE 100 index dropped 132.5 points to 5493.4 points, a fall of nearly 2.4%.

The Chartered Institute of Purchasing and Supply/Markit index of manufacturing fell to 45.8 in June from 49.5 in May. Any reading below 50 indicates contraction. It was the weakest number since December 2001, when manufacturing suffered a sharp drop in activity after the September 11 attacks in the U.S.

"The U.K. manufacturing sector buckled under the weight of a brutal combination of survey record-cost inflation and weak domestic demand in June," said Rob Dobson at Markit Economics.

The output index tumbled to 43.5 last month from 49.2 in May, marking the worst decline in production since 1998. Companies cut back production to clear backlogs at the fastest pace in the history of the survey.

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Allied Troop Deaths In Afghanistan Exceed Those In Iraq For Second Month
2008-07-01 20:26:52

Militants in Afghanistan killed more U.S. and NATO troops than those in Iraq in June after a fresh spate of rebel attacks that highlighted the growing strength of the Taliban.

A count by Associated Press (A.P.) found that at least 45 international troops, including 27 from the U.S. and 13 British, died in Afghanistan last month, compared with 31 international soldiers killed in Iraq, of whom 29 were from the U.S.

It was the second consecutive month that more troops were killed in Afghanistan, where international forces suffered their deadliest month since the 2001 U.S.-led invasion.

The figures follow a report by the Pentagon last week that forecast the Taliban would maintain or increase the rate of attacks along the Pakistan border where US troops operate. Attacks are already up by 40% this year from 2007.

Fighting between militants and international troops is intensifying in the southern half of Afghanistan. A.P.'s tally places the total death toll at 2,100 in the past six months.

While most of those killed have been militants, foreign troop deaths are also rising, as insurgents get more effective at ambushes and roadside bombings.

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Clay Felker, Magazine Pioneer, Dies At 82
2008-07-01 20:25:54
Clay Felker, a visionary editor who was widely credited with inventing the formula for the modern magazine, giving it energetic expression in a glossy weekly named for and devoted to the boisterous city that fascinated him - New York -  died on Tuesday at his home in Manhattan. He was 82.

His death was of natural causes, said his wife, the author Gail Sheehy. He had had throat cancer in his later years.

Felker edited a number of publications besides New York magazine. There were stints at Esquire; The Village Voice; Adweek; Manhattan, inc.; and others; he created an opposite-coast counterpart to New York and called it New West.

Yett it was at New York that he left his biggest imprint on American journalism. He founded it as a Sunday supplement to the New York Herald Tribune in 1964. Four years later, after the newspaper had closed, he and the graphic designer Milton Glaser reintroduced New York as a glossy, stand-alone magazine.

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African Leaders Propose Zimbabwe Talks
2008-07-01 20:25:13
An African summit in Sharm El-Sheikh, Egypt, Tuesday rejected calls to deny recognition to the disputed election results in Zimbabwe and instead proposed talks between President Robert Mugabe and opposition leader Morgan Tsvangirai in an effort to form a joint government.

The African leaders, meeting to discuss a response to the crisis in Zimbabwe, conferred behind closed doors, with Mugabe in attendance. According to a statement presented by Botswana's delegation at the meeting and later obtained by journalists, at least some of the leaders of the 53-nation African Union were urging their counterparts not to recognize the elections, or Mugabe as president.

Friday's flawed vote "does not confer legitimacy on the government of President Mugabe," the Botswana delegation said. The statement noted that a consensus appeared to be emerging among African leaders for a power-sharing government in Zimbabwe. Zimbabwe's opposition should be treated as equal partners with Mugabe in any such government, said the Botswanan statement.

A similar power-sharing proposal was adopted this year in Kenya, ending violence between two parties after a close presidential election.

However, Mugabe's spokesman, George Charamba, seemed to rule out the idea for Zimbabwe earlier in the day.

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NewsBlog: French President Sarkozy Loses His Cool, Leaked Video Already Has 400,000 Hits
2008-07-01 20:24:42

Nicolas Sarkozy's attempts to get France's presidency of the European Union off to a flying start with a carefully orchestrated television interview have been undermined since footage of him losing his cool in front of the camera became an instant internet hit.

France 3, the state TV station which broadcast Sarkozy's hour-long interview last night, said it had ordered an immediate internal investigation into the leaking of the tape, which by this afternoon had already been watched more than 440,000 times.

The footage, recorded in the minutes before the prime time interview, shows a visibly irritated Sarkozy struggling to maintain his calm as tensions between the President and state television employees erupt onto the set.

Enraged at the perceived snub by a technician who, while pinning a microphone to his shirt, appears not to have heard Sarkozy address him, the president gives in to a barely controlled outburst of anger.

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Editorial: As Foreclosures Escalate
2008-07-01 05:23:15
Intellpuke: This editorial appeared in the New York Times edition for Tuesday, July 1, 2008.

By the time the Senate returns next Monday from its July 4 recess, some 55,000 more homes will have entered foreclosure. And that’s hardly the full picture of the growing calamity. More than three million homeowners are currently at risk of default and millions more are expected to join them in the coming year as home prices drop, the economy falters and delinquencies rise. Yet the Senate went ahead with its vacation last Friday without passing a foreclosure prevention measure.

The bill was expected to pass, but the vote was derailed by petty politics. Senator John Ensign, Republican of Nevada, for example, demanded that the Senate add a multibillion dollar package of tax breaks for renewable energy. Democrats balked - not out of opposition to the tax breaks, which rightly enjoy bipartisan support, but because Mr. Ensign wanted to tack them on to the foreclosure bill without paying for them. That would threaten passage of the bill in the House, which is more committed than the Senate to pay-as-you-go governing.

This sort of delay achieves political ends, like denying Democrats the chance to campaign on the accomplishment during the recess, but it’s exceedingly poor policy. Foreclosures are feeding the nation’s severe economic problems. Turmoil in the financial markets is rooted in the collapse of the housing bubble and will not abate until house prices stabilize and sales pick up. Even Americans fortunate enough to have a down payment and a willing lender are hesitating, understandably fearful of further price drops. Rising foreclosures add daily to the glut of unsold homes, pushing prices down and foreclosures up in a vicious cycle.

That same financial turmoil, coupled with huge losses in home equity, has deprived many Americans of the means or the confidence to buy a new house or other big-ticket items, like cars. In a recent Gallup poll, a majority of Americans said they were now worse off financially than they were a year ago. That’s the first time in the 32-year history of the question that more than half the population has reported losing ground.

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Saudi Oil Project Causes Skepticism
2008-07-01 05:22:46
For mile after mile, there is nothing but flat and unrelenting sand on every side, with a few black camels wandering in the desert glare.

Then, suddenly, it rises into view, like some vast industrial mirage. The Khurais oil field’s processing plant resembles nothing so much as an oversize Erector Set, its unlikely vertical tubes and steel scaffolding gleaming in the sun.

Yet this remote patch of desert could hold the key to the soaring price of gasoline around the world.

Khurais, about 90 miles east of Riyadh, the Saudi capital, is one of the planet’s last giant oil fields. The Saudis say that it holds 27 billion barrels of oil - more oil than all the proven reserves of the United States - and that it will significantly bolster the kingdom’s production capacity once it starts pumping a year from now, easing global need.

Some oil traders and analysts doubt that. Their pessimistic forecasts of dwindling oil supplies have helped propel the current increase in prices, which pushed past $140 a barrel last week and seem to be heading higher.

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Experts At Petroleum Conference Split On Oil Prices
2008-07-01 05:22:14
Experts remained divided Monday over the causes of soaring oil prices at the 19th World Petroleum Congress (WPC), one of the top events of the industry, which was inaugurated here one week after a meeting in Saudi Arabia failed to bring prices down.

Oil rose more than $3 a barrel Monday to a new record above $143, propelled by heightened market fears of conflict between Israel and Iran over Tehran’s nuclear program. Prices later retreated from session highs, partly reflecting a rebound in the U.S. dollar versus the euro. U.S. light crude was up $1.76 at $141.97 a barrel by 1357 GMT, after a record high of $143.67 a barrel.

London Brent crude was up $1.91 at $142.22.

The congress brought thousands of experts from more than 50 countries, including OPEC head Chakib Khelil, International Energy Agency Director Nobuo Tanaka and energy ministers and oil company executives, to the Spanish capital. The congress ends Thursday.

Spanish Industry Minister Miguel Sebastian said operations in futures markets had increased the demand for crude by 850,000 barrels daily. He called for a “deep market reform.”

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Future Of Biofuel Clouded By Weather
2008-07-01 00:51:41

The record storms and floods that swept through the Midwest last month struck at the heart of America’s corn region, drowning fields and dashing hopes of a bumper crop.

They also brought into sharp relief a new economic hazard. As America grows more reliant on corn for its fuel supply, it is becoming vulnerable to the many hazards that can damage crops, ranging from droughts to plagues to storms.

The floods have helped send the price of ethanol up 19 percent in a month. They appear to have had little effect on the price of gasoline at the pump, as ethanol represents only about 6 percent of the nation’s transport fuel today.

That share is expected to rise to at least 20 percent in coming decades. Experts fear that a future crop failure could take so much fuel out of the market that it would send prices soaring at the pump. Eventually, the cost of filling Americans’ gas tanks could be influenced as much by hail in Iowa as by the bombing of an oil pipeline in Nigeria.

“We are holding ourselves hostage to the weather,” said John M. Reilly, a senior lecturer at the Massachusetts Institute of Technology and an ethanol expert. “Agricultural markets are subject to wide variability and big price spikes, just like oil markets.”

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Campaign Blog: Obama Hits Back On Questions About His Patriotism
2008-07-01 00:51:04
Dogged by persistent questions about his faith in God and country, Sen. Barack Obama Monday journeyed to Harry Truman's birthplace to lay out his vision of patriotism, conceding that he has learned in this campaign "the question of who is - or is not - a patriot all too often poisons our political debate."

"Throughout my life, I have always taken my deep and abiding love for this country as a given, " said Obama. "It was how I was raised. It was what propelled me into public service. It it why I am running for president. And yet at times over the last 16 months, my patriotism [has been] challenged - at times as a result of my own carelessness, more often as a result of the desire by some to score political points and raise fears about who I am and what I stand for."

The address, at the Truman Memorial Building here in Independence, Missouri, was an extraordinary one for a presumptive nominee of the Democratic Party just four months before election day. Obama has built his candidacy on the promise of change in a political year when the vast majority of Americans feel their nation is on the wrong track. But he has found himself tripping over one of the lowest hurdles a politician faces, the issue of his patriotism.

False assertions have persistently circulated online, claiming incorrectly that Obama will not recite the Pledge of Allegiance, place his hand on his heart for the national anthem or wear an American flag pin on his lapel.

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Bush Administration Delaying Medicare Fee Cut
2008-07-01 00:50:09
The Bush administration said Monday it will delay paying doctors for treating Medicare patients in early July to give Congress more time to block a scheduled 10.6 percent fee cut.

The move by the Centers for Medicare and Medicaid Services doesn't block the cut, scheduled to take place Tuesday. It's up to Congress to decide that.

To give Congress more time to act, the agency will instruct its contractors to delay the processing of any physician or non-physician Medicare claims for health care services given during the first 10 business days of July. Claims for services received on before June 30 will be processed as usual.

CMS will not be making any payments at the 10.6 percent reduced rate until July 15, at the earliest, agency spokesman Jeff Nelligan said. The delay in processing claims probably means that claims that would have been paid in mid-July will be delayed up to a week, the agency estimates.

Another option would have been to issue on-time payments at the lower rate and pay the rest later after Congress fixes the problem.

Congress, facing the prospect of millions of angry seniors at the polls in November, will be under tremendous pressure to act quickly when it returns to Washington the week of July 7 to prevent the cuts in payments for some 600,000 doctors who treat Medicare patients. The cuts were scheduled because of a formula that requires fee cuts when spending exceeds established goals.

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Light Winds Help Big Sur Firefighters
2008-07-01 00:49:26
Mother Nature has lent a helping hand to firefighters battling blazes around the northern part of the state today, dishing up light winds that appear to be pushing a blaze threatening Big Sur back on itself for now.

More than 1,250 structures remain threatened by the Basin Complex fire in Monterey County, one of 1,500 blazes that have blackened nearly 400,000 acres in tinderbox-dry Northern California over the last 10 days.

Near Big Sur, crews with the U.S. Forest Service have been feverishly trying to construct fire breaks to protect Palo Colorado Canyon, a scattered collection of homes hidden in the steep hills east of California 1.

"You don't realize it driving along the highway, but there are quite a few homes tucked up in those hillsides," said John Ahman, a Forest Service spokesman. "And those are what we're most concerned with."

The good news for now, said Ahman, is that winds have been light and out of the northwest, helping push the fire back onto itself since Sunday. A dose of coastal overcast also propped up humidity levels, helping further slow the fire's advance and allowing hand crews to get closer to fight the blaze.

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