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Thursday, November 13, 2008

Free Internet Press Newsletter - Thursday November 13 2008 - (813)

Thursday November 13 2008 edition
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Overhaul of U.S. Justice Department Planned
2008-11-12 22:03:48

As a transition team for the Obama administration begins work on a Justice Department (DOJ) overhaul, the key question is where to begin.

Political considerations affected every crevice of the department during the Bush years, from the summer intern hiring program to the dispensing of legal advice about detainee interrogations, according to reports by the inspector general and testimony from bipartisan former DOJ officials at congressional hearings.

Although retired federal judge Michael B. Mukasey, who took charge of the department last winter, has drawn praise for limiting contacts between White House officials and prosecutors, and for firmly rejecting the role of politics in law enforcement, restoring public confidence in the department's law enforcement actions will be central, say lawmakers and former government officials.

"The infusion of politics into the Justice Department and an abdication of responsibility by its leaders have dealt a severe blow," Senate Judiciary Committee Chairman Patrick J. Leahy (D-Vermont) and Sen. Arlen Specter (Pennsylvania), the panel's ranking Republican, wrote in an opinion piece last month. "Great damage has been done to the credibility and effectiveness of the Justice Department."

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Iran Test-Fires New Missile - Israel, U.S. Bases In Range
2008-11-12 22:03:28
Iran said it test-fired a new generation of surface-to-surface missile on Wednesday and that the Islamic Republic was ready to defend itself against any attacker.

Iran's latest missile test followed persistent speculation in recent months of possible U.S. or Israeli strikes against its nuclear facilities, which the West suspects form part of a covert atomic weapons program, a charge Tehran denies.

U.S. President-elect Barack Obama, like outgoing U.S. President George W. Bush, has not ruled out military action although he has criticized the Bush administration for not pursuing more diplomacy and engagement with Tehran.

Washington said the test highlighted the need for a missile defense system it plans to base in Poland and the Czech Republic to counter threats from what it calls "rogue states."

Iranian Defence Minister Mostafa Mohammad Najjar said the Iranian-made surface-to-surface Sejil missile had "extremely high capabilities" and was only intended for defensive purposes.

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U.S. Reports Huge Alaska Natural Gas Reserves
2008-11-12 22:02:51
Frozen crystals packed with concentrated natural gas and buried 2,000 feet below the permafrost on Alaska's North Slope could become the next major domestic energy source, according to an assessment released Wednesday by the U.S. Geological Survey.

The study finds that in the North Slope, frozen methane-and-water crystals known as hydrates contain as much as 85.4 trillion cubic feet of recoverable natural gas. That's enough to heat 100 million homes for as long as 10 years,  said Interior Secretary Dirk Kempthorne.

New research into how to extract those resources has moved the possibility of recovering the usable energy from the realm of "science and speculation" to that of the "actual and useful," Kempthorne said Wednesday.

Globally, "hydrates have more potential for energy than all other fossil fuels combined," he said. "This can be a paradigm shift."

Government research is beginning to show that it may be possible to extract hydrates using depressurization, a technique used to get at more conventional fuel sources. Simply boring into the ground may be enough to change the pressure to extract it, said Steve Rinehart, a spokesman for British Petroleum in Alaska. Or the pressure could be changed by pumping.

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Dow Down 411 Points On Investors' Worries
2008-11-12 16:42:01

Shares on Wall Street tumbled more than 4 percent on Wednesday as frightened investors wondered how long the economic slowdown will last, how deep it will cut, and whether Washington can do anything to stanch the bleeding.

Financial markets compounded their early losses in afternoon trading, ending down for a third day. The Dow Jones industrial average fell 411.30 points or 4.73 percent, while the broader Standard & Poor’s 500-stock index was down more than 5 percent for the day and nearly 9 percent for the week.

“It’s just a downward spiral caused by fear,” said Richard Sparks, senior equity analyst at Schaeffer’s Investment Research. “We’ve got bad news everywhere.”

Wall Street spent the day looking at Washington for guidance and reassurance, and investors did not like what they saw, analysts said.

“Wall Street is increasingly taking its cues from D.C.,” Marc Zandi, chief economist at Moody's , said by e-mail message. “Policymakers are deciding who survives and who doesn’t.”

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Study: Deadly Stomach Bug More Common Than Thought
2008-11-12 15:26:09
A nasty, sometimes deadly stomach bug is at least six times more common than was thought, researchers said Tuesday, based on a survey of hundreds of U.S. hospitals. The germ, Clostridium difficile, is resistant to some antibiotics and has become a regular menace in hospitals and nursing homes.

Doctors say it plays a role in hundreds of thousands of hospitalizations each year, and that number has been growing.

The latest study estimates that more than 7,100 hospital patients are infected with it on any given day. That number is between 6.5 and 20 times greater than previous estimates, according to the Association for Professionals in Infection Control and Epidemiology. Researchers from that group presented their findings Tuesday at a medical conference in Orlando, Florida.

"This study shows that C. difficile infection is an escalating issue in our nation's health care facilities," said Dr. William Jarvis, the study's lead investigator, in a prepared statement. Jarvis, formerly a scientist with the U.S. Centers for Disease Control and Prevention, is a consulting epidemiologist hired by the association.

The study suggests that about 13 per 1,000 hospital patients have the germ.

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U.S. May Ease Rules For Mortgage Relief Program
2008-11-12 15:25:40
The government may modify the rules for a $300 billion mortgage-relief program so that troubled homeowners are better able to swap risky loans for more affordable ones, a top Bush administration official said Wednesday.

The program, included in a housing bill passed by lawmakers over the summer, was launched Oct. 1. But there are concerns that lenders will not take part because they have to agree to reduce the value of a loan and take a loss.

“We’re concerned that the program - as constructed today - is limiting people’s availability,” the secretary of housing and urban dvelopment, Steve Preston, said in an interview with Associated Press writers and editors.

In its current design, lenders have to take a big loss. They must absorb the difference between the current mortgage’s value and a new loan for 90 percent of the house’s current appraised value. One potential change is to make the new loan around 97 percent of the current home value, thus requiring lenders to take a smaller loss, said Preston.

Making that change and others “would open up participation in the program,” he said.

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N.Y. Gov. Paterson Calls For $5.2 Billion In Cuts
2008-11-12 15:25:06

New York Gov. David A. Paterson dropped the budget hammer on Wednesday, proposing $5.2 billion worth of cuts over the next 16½ months, with Medicaid and education, the two largest pieces of the budget, bearing the brunt of the pain.

The governor said he would not seek layoffs, but state workers are being asked to forgo a previously negotiated 3 percent pay raise for next year, a move that would require the labor unions to reopen their contracts. Labor leaders have already expressed reluctance to make such a move. The governor is also proposing to make state workers pay for a greater part of the bill for their health care benefits.

The governor said during a press conference on Wednesday morning that Wall Street had “bailed us out” for years, but “now the well has run dry” amid Wall Street’s turmoil and the state must halt its free-spending habits.

“We’re not going to get out of this quagmire we’ve built until we reduce our spending,” he said.

But hospital and teachers’ unions, and unions that represent state workers, have already started to lay the groundwork for a fight over the budget cuts.

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Recession Fears Weigh Down Markets
2008-11-12 15:24:37
World markets continued their downward trend Wednesday, as recession fears remained in the fore.

In an effort to bolster economic confidence U.S. Treasury Secretary Henry Paulson said he had seen signs of improvement in the economic situation.

However, Wall Street markets dipped further, weighed down by losses in Europe and Asia. The benchmark Dow Jones and Nasdaq indexes were down nearly 4 percent in late trading.

Paulson said "at home and around the world" there were already signs of improvement.

"Our system is stronger and more stable than just a few weeks ago," Paulson said as he updated reporters on the progress of the U.S. government's financial rescue package.

Paulson warned that the economy remained "fragile" and said further market turmoil could be expected as a consequence of the collapse of the U.S. housing market.

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Macy's Reports $44 Million 3rd-Quarter Loss
2008-11-12 15:23:52
Macy's Inc. swung to a loss in the third quarter as sales dropped more than 7 percent, with the retailer saying the holiday season would be a ''nailbiter'' and it saw no benefit in being optimistic for next year.

The department store operator also said Wednesday it slashed its budget for 2009 capital expenditures by almost half as it navigates the deteriorating economy. Macy's reiterated its profit outlook for the year, but said it would be at the low end of the range if current sales trends continue.

As for the upcoming holiday season, ''it will be a nailbiter,'' Chief Financial Officer Karen Hoguet told analysts in a conference call. She also noted that Macy's planned to have inventories for spring and fall 2009 below last year's levels, saying, ''We don't see an upside in being optimistic.''

Shares in the Cincinnati-based chain fell 49 cents, or more than 5 percent, to $8.92.

Macy's said it lost $44 million, or 10 cents per share, in the quarter, after a profit of $33 million, or 8 cents per share, a year earlier. Excluding costs related to the consolidation of three regional divisions that totaled $16 million - $10 million after tax or 2 cents per share - the third-quarter loss was 8 cents per share.

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Blackwater Likely To Be Fined Millions In Iraq Weapons Case
2008-11-12 22:03:37
The State Department is preparing to slap a multi-million dollar fine on private military contractor Blackwater USA for shipping hundreds of automatic weapons to Iraq without the necessary permits.

Some of the weapons are believed to have ended up on the country's black market, department officials told McClatchy, but no criminal charges have been filed in the case.

The expected fine is the result of a long-running federal investigation into whether employees of the firm shipped weapons hidden in shrink-wrapped pallets from its Moyock, North Carolina, headquarters to Iraq, where Blackwater is the State Department's largest personal security contractor.

Since the arms shipment allegations first became public 14 months ago, Blackwater, which has received $1.2 billion in federal contracts, according to the Web site, has consistently denied involvement in illicit arms trafficking.

However, the State Department found that Blackwater shipped 900 weapons to Iraq without the paperwork required by arms export control regulations, said one department official. Of that number, 119 were "particularly ... erroneous," he said. He and the other officials spoke on the condition of anonymity because the decision hasn't been announced.

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Appeals Court Uphold Charges Against Rep. Jefferson
2008-11-12 22:03:17
A federal appeals court upheld bribery and other charges against Louisiana Democratic U.S. Rep. William Jefferson on Wednesday, clearing the way for a trial.

Jefferson, who cruised to victory in a primary last week and is expected to easily win re-election, had sought to dismiss a 16-count indictment charging him with taking bribes, laundering money and misusing his congressional office for business dealings in Africa.

A three-judge panel of the 4th U.S. Circuit Court of Appeals rejected Jefferson's claims that a federal grand jury received evidence that violated his constitutional right to legislative immunity.

Jefferson's attorneys argued that three staffers should not have been allowed to tell the grand jury about Jefferson's relationships with African leaders and his knowledge about West African nations because those activities were part of his legislative duties.

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In Alaska Senate Race, Begich Leads Stevens By 3 Votes, 35,000 Votes Left To Count
2008-11-12 22:02:36
The elections division still has over 10,000 ballots left to count Wednesday and thousands more through next week, but the latest numbers show Mark Begich leading Sen. Ted Stevens 125,019 to 125,016.

The new numbers, reflecting nearly 43,000 absentee ballots counted Wednesday, are from all over the state. Election night, Ted Stevens led the Democratic Begich by about 3,000 votes.

Alaska Rep. Don Young is maintaining his solid lead over Ethan Berkowitz, who still has not conceded the election. Young now leads by 15,710 votes, a lead that has only narrowed by about 1,000 votes Tuesday.

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Two Top Officials In U.S. Intelligence Expect To Lose Jobs
2008-11-12 15:28:00

The nation's top two intelligence officers expect to be replaced by President-elect Barack Obama early in his administration, according to senior intelligence officials.

A number of influential congressional Democrats oppose keeping Director of National Intelligence Mike McConnell and CIA Director Michael V. Hayden in their posts because both have publicly supported controversial Bush administration policies on interrogation and telephone surveillance. One Democrat on the Senate intelligence committee said there is a "consensus" view on the matter.

Other Democrats and many intelligence experts, however, give high marks to the current cadre of intelligence leaders, crediting them with restoring stability and professionalism to a community rocked by multiple scandals in recent years. A government official who has closely followed the evolution in the intelligence leadership in recent years argued that it is important to keep at least a few "seasoned" professionals in place during wartime.

Obama transition officials, who have steadfastly declined to discuss the personnel selection process, said yesterday that no decisions have been made regarding intelligence appointments. McConnell and Hayden, both career intelligence professionals, interpret the Obama team not reaching out to them as a sign that they will not be kept on, said intelligence officials.

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Paulson: Federal Bailout May Include Credit Card, Loan Companies
2008-11-12 15:25:56

U.S. Treasury Secretary Henry M. Paulson, Jr., said he wants to expand the government's $700 billion bailout program to include credit card, student loan and car loan companies, part of an effort to ensure that households and businesses have access to a broad array of borrowing options.

In a speech Wednesday morning, Paulson laid out his priorities for some $350 billion of the bailout fund that remains uncommitted. Much of the first half was used for direct capital investments into banks.

At least some of the remainder, said Paulson, should be used to reinvigorate the market for credit cards, student and auto loans - which combined account for some 40 percent of consumer credit.

"This market, which is vital for lending and growth, has for all practical purposes ground to a halt," said Paulson.

His comments amount to a significant shift in the use of the bailout fund from a program to remove troubled loans from the books of financial institutions into an effort to support household and business spending at a time when both are in decline.

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U.S. Supreme Court Rules For Navy In Dispute Over Sonar Harming Whales
2008-11-12 15:25:21

The Supreme Court Wednesday lifted restrictions on the Navy's use of sonar in training exercises off the Southern California coast, ruling that U.S. national security interests outweigh the risk of harming whales and other marine mammals.

In a 5-4 decision, the court vacated a preliminary injunction imposed by a lower court in response to complaints by environmental groups that the Navy's use of loud, mid-frequency sonar during submarine-detecting exercises violates U.S. environmental laws. It was the first decision of the court's current term.

The sharply divided court did not rule on the merits of the environmental groups' claims but said the lower court "abused its discretion" by imposing the restrictions.

The majority opinion was written by Chief Justice John G. Roberts, Jr., and was joined by justices Samuel A. Alito,  Jr., Anthony M. Kennedy, Antonin Scalia and Clarence Thomas. Justice Stephen G. Breyer wrote a partial dissent, which was joined in part by Justice John Paul Stevens. Justice Ruth Bader Ginsburg issued a separate full dissenting opinion that was seconded by Justice David H. Souter.

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Insurgents Seize Somalia Port City
2008-11-12 15:24:54
Another major city in Somalia fell without a shot to Islamist insurgents on Wednesday, with Islamist guerrilla fighters taking over the strategic port of Merka, said residents and Somali officials.

The Islamists are now in control of a large - and rapidly growing - swath of south-central Somalia, and the weak transitional government seems too paralyzed by infighting to do much about it.

The government, which is recognized internationally and backed by Ethiopian troops, has repeatedly urged the United Nations to send in peacekeepers to quell the insurgency and stabilize the country but, with the continuing conflicts in eastern Congo and Darfur, another major international peacekeeping effort in the region seems unlikely at the moment.

Hundreds of fighters rolled into the port town of Merka at around 8 a.m. on Wednesday in heavily-armed pickup trucks, meeting no resistance because government-allied militias had fled the night before, according to residents. Merka is only 60 miles south of Mogadishu, Somalia’s bullet-pocked capital, and Somali officials warned that the Islamists were now planning to lay siege to Mogadishu.

“We know their grand plan,” said Abdi Awaleh Jama, an ambassador at large for the transitional federal government. “But we’re not going to run away. We’re going to fight with whatever we have.” But, he added, “We need help -  urgently.”

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Swiss Banker Charged With Conspiring In Massive Tax Fraud
2008-11-12 15:24:08

The Justice Department Wednesday announced that a senior Swiss banker has been indicted on charges of conspiring to defraud the U.S. government by helping about 20,000 U.S. clients hide $20 billion in assets from the Internal Revenue Service.

The indictment of Raoul Weil alleged that he conspired with a host of others at his bank, overseeing a business that employed encrypted laptops, numbered accounts and counter-surveillance techniques to help American clients conceal their identities and evade taxes.

Weil oversaw the bank's cross-border business that catered to U.S. clients, generating about $200 million a year in revenue for the bank, the Justice Department said in a news release.

The announcement did not name the bank, describing it only as a large Swiss bank with offices worldwide.

A report on UBS's Web site says an executive name Raoul Weil was head of UBS's wealth management international business between 2002 and 2007. The indictment says the Raoul Weil charged in the case was head of the unnamed Swiss bank's wealth management business from 2002 through 2007.

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