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Saturday, February 14, 2009

Free Internet Press Newsletter - Saturday February 14 2009 - (813)

Saturday February 14 2009 edition
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U.S.Senate Passes Stimulus Plan
2009-02-14 02:35:53
With the House of Representatives and Senate giving final approval to the massive stimulus bill Friday, and President Obama prepared to sign it early next week, the question now is: Just how soon might Americans begin to feel its benefits, and when will they know whether it's working?

The scale of the legislation is so huge and its provisions so diverse that its effects could potentially be felt in almost every corner of American society - from small businesses and major industries to individuals in their varied roles as workers, taxpayers and consumers.

Like a time-release capsule, the $787-billion plan will move into the nation's economic bloodstream in stages. A majority of Americans should see more money in their pockets quickly, as a result of tax cuts designed to reduce withholding and fatten take-home pay. Investments in science, basic research and the so-called green economy may not yield sizable benefits for years, even decades.

The Congressional Budget Office said the legislation would deliver its largest benefits to the nation's total gross domestic product by the end of this year, with the effect dropping some in 2010 and disappearing altogether by 2013.

The budget office said the bill would have its greatest effect in terms of increasing employment next year, when about 3.6 million jobs could be created. But the report added that the package could have a positive effect on employment for the next five years, perhaps leading to the creation of as many as 11.6 million jobs during that span.

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U.S. Houses Passes Stimulus Bill, Senate Still Voting
2009-02-13 22:25:24

The House of Representatives Friday passed a massive economic stimulus plan and sent it to the Senate, giving President Obama a major legislative victory in what he says is a crucial effort to pull the nation back from the brink of depression.

After the $787 billion package of stimulus spending and tax cuts passed the House on a largely party-line vote of 246 to 183, the Senate began voting on the bill at 5:30 p.m. But the Democratic leadership said it would hold the Senate vote open until late tonight to ensure that a member attending a memorial service for his mother in Ohio, Sherrod Brown, could fly back to cast what was expected to be the decisive 60th vote needed for final passage.

The legislation had received 59 "aye" votes, including those of the three Republicans who previously broke ranks with their party leadership to back the bill. Sen. Edward M. Kennedy (D-Massachusetts), who voted yes on Tuesday on an earlier version of the legislation, was out of town for treatment of his brain cancer and did not return for the vote, making Brown's vote critical.

In the House, seven Democrats joined 176 Republicans in voting against the bill. One member voted present, and three did not vote. No Republicans voted in favor of the package.

In its latest cost estimate, the Congressional Budget Office put the price tag of the stimulus plan at $787.2 billion over 10 years, a slight drop from the $789 billion that lawmakers said it would cost after it was approved by House and Senate negotiators.

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Drug Giant Pledges Cheap Medicine For World's Poor, Shocks Industry
2009-02-13 22:24:58
The world's second biggest pharmaceutical company is to radically shift its attitude to providing cheap drugs to millions of people in the developing world.

In a major change of strategy, the new head of GlaxoSmithKline, Andrew Witty, has told the Guardian he will slash prices on all medicines in the poorest countries, give back profits to be spent on hospitals and clinics and - most ground-breaking of all - share knowledge about potential drugs that are currently protected by patents.

Witty says he believes drug companies have an obligation to help the poor get treatment. He challenges other pharmaceutical giants to follow his lead.

Pressure on the industry has been growing over the past decade, triggered by the AIDS catastrophe.

Drug companies have been repeatedly criticized for failing to drop their prices for HIV drugs while millions died in Africa and Asia. Since then, campaigners have targeted them for defending the patents, which keep their prices high, while attempting to crush competition from generic manufacturers, who undercut them dramatically in countries where patents do not apply.

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Obama To Detail Foreclosure Plan On Wednesday
2009-02-13 22:24:00
Citigroup, Bank of America and J.P. Morgan Chase freeze home foreclosures.

President Obama will release the details of his foreclosure prevention plan Wednesday, the White House announced Friday as several large banks pledged to temporarily stop foreclosures until the program is in place.

Obama will make the eagerly awaited announcement from Arizona, White House press secretary Robert Gibbs told reporters this afternoon.

That schedule came as J.P. Morgan Chase, Bank of America and Citigroup announced temporary moratoriums on foreclosures at the urging of a key House member.

Top executives from these firms endured tough questioning before the House Financial Services Committee earlier this week, including about whether the banks have done enough to help struggling homeowners. In public statements and letters to the committee released today, the banking firms sought to show the extent of their efforts.

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With Every Satellite Launch, Risks From Space Debris Increase
2009-02-13 22:22:54

Satellite 33442 orbits the earth every 91 minutes, circling at an inclination of 56.1 degrees to the Equator and gradually slowing down, destined to fall into the atmosphere in late spring or summer and burn up. Aficionados of satellites know that 33442 is a tool bag. A spacewalking astronaut let it slip last year, adding one more tiny, artificial moon to the junk in low Earth orbit.

The military tracks about 18,000 pieces of orbital debris. Earlier this week the census of space-shmutz suddenly jumped by 600, the initial estimate of the number of fragments from a stunning collision Tuesday of two satellites high above Siberia.

Space is now polluted with the flotsam and jetsam of a satellite-dependent civilization. The debris is increasingly a hazard for human spaceflight and has put everything from the Hubble Space Telescope to communications satellites at risk of being struck by an object moving at hypervelocity.

The military's radar can spot objects about four inches in diameter, roughly the size of a baseball, or larger. This collision, however, may have produced many thousands of small, undetectable pieces of debris that would still carry enough kinetic punch at orbital velocities to damage or destroy a spacecraft.

"We expect, when all is said and done, there will be hundreds if not thousands of pieces larger than the four inches. We expect there will be tens or hundreds of thousands of pieces down to a centimeter or a millimeter," said Nicholas Johnson, NASA's chief scientist for orbital debris.

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Peanut Corp. Of America Files For Bankruptcy
2009-02-13 22:21:53
The peanut processing company at the heart of a national salmonella outbreak is going out of business. The Lynchburg, Virginia-based Peanut Corp. of America filed for Chapter 7 bankruptcy in U.S. Bankruptcy Court in Virginia Friday, the latest bad news for the company that has been accused of producing tainted peanut products that may have reached everyone from poor school children to disaster victims.

"It's regrettable, but it's inevitable with the events of last month," said Andrew S. Goldstein, a bankruptcy lawyer in Roanoke, Va., who filed the petition.

The salmonella outbreak was traced to the company's plant in Blakely, Georgia, where inspectors found roaches, mold and a leaking roof. A second plant in Plainview, Texas was shuttered this week after preliminary tests came back positive for possible salmonella contamination. So far, the outbreak has been suspected of sickening more than 630 people and may have caused nine deaths. It also has led to more than 2,000 product recalls, one of the largest recalls in U.S. history.

Companies file Chapter 7 to liquidate their assets and distribute the proceeds to creditors. A trustee is automatically appointed to oversee the wind down, as opposed to a Chapter 11 filing that gives a company breathing room while it tries to reduce its debts and continue in business. The company said in the filing that its debt and assets both ranged between $1 million and $10 million.

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50 Killed In Plane Crash Near Buffalo, New York
2009-02-13 13:13:53

Federal investigators have retrieved both black boxes from a Continental Airlines plane that crashed late Thursday night near Buffalo on its way to Buffalo Niagara International Airport from Newark, killing 50 people. The boxes were in good condition and should be at the laboratories of the National Transportation Safety Board in Washington, D.C.,  for analysis this afternoon, said officials.

The plane, which crashed in the hamlet of Clarence Center, N.Y., carried 44 passengers, a crew of 4 and an off-duty crew member, officials said. All the people aboard the plane and one person in a house destroyed by the plane were killed, said Chris Collins, the Erie County executive.

Two others in the house, a 57-year-old woman and her 22-year-old daughter, suffered minor injuries and were taken to a nearby hospital, where they were treated and released, said officials.

Among those on the flight was Alison L. Des Forges, a historian and human rights advocate who documented the 1994 genocide in Rwanda and has investigated related issues in Burundi and Democratic Republic of the Congo since then, according to Emma Daly, communications director of Human Rights Watch in New York City.

Also on the flight was Beverly Eckert, the widow of Sean Rooney, a Buffalo native who died in the Sept. 11 terrorist attacks on the World Trade Center.

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50 Killed When Continental Flight 3407 Crashed
2009-02-13 08:46:56

Fifty people died when a Continental Connection airplane crashed into a house in Clarence Center shortly after 10:15 p.m. Thursday, setting off a huge fire that could be seen miles away.

The dead included 44 passengers, five crew members and a person on the ground. Earlier reports listed only four crew members.

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Schwarzenegger Delays Layoff Notices For 20,000 State Employees
2009-02-14 02:35:43
Bullish on the prospects of winning approval this weekend of a budget to close California's deficit, Gov. Arnold Schwarzenegger delayed plans Friday to dispatch layoff notices to up to 20,000 state workers.

Yet, as the clock ticked toward a planned vote Friday by the Legislature, the odds appeared mixed for endorsement of a spending blueprint said by battle-worn officials to contain something that everyone can hate.

The governor had threatened to send layoff notices if the Legislature didn't agree on a budget by Friday, starting a process that could lead to the termination of 10,000 state workers in the coming months; but he eventually reversed course, saying the curtain soon might fall on the state's long budgetary drama.

"We believe we are close to an agreement, so we will not be sending layoff notices for the time being," said Aaron McLear, a spokesman for Schwarzenegger. But the notices still could go out next week if the budget fails to pass, he said.

Even before the final draft of the budget was off the presses, lawmakers on both sides of the aisle were being flooded with phone calls and e-mails from constituents and special interests with a bone to pick.

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Intelligence Chief: Financial Crisis Top Threat To U.S. Security
2009-02-13 22:25:11

Director of National Intelligence Dennis C. Blair told Congress Thursday that instability in countries around the world caused by the current global economic crisis, rather than terrorism, is the primary near-term security threat to the United States.

"Roughly a quarter of the countries in the world have already experienced low-level instability such as government changes because of the current slowdown," Blair told the Senate Select Committee on Intelligence, delivering the first annual threat assessment in six years in which terrorism was not presented as the primary danger to this country.

Making his first appearance before the panel as President Obama's top intelligence adviser, Blair said the most immediate fallout from the worldwide economic decline for the United States will be "allies and friends not being able to fully meet their defense and humanitarian obligations." He also saw the prospect of possible refugee flows from the Caribbean to the United States and a questioning of American economic and financial leadership in the world.

Blair also raised the specter of the "high levels of violent extremism" in the turmoil of the 1920s and 1930s along with "regime-threatening instability" if the economic crisis persists over a one-to-two-year period.

In answer to a question about whether he was shifting assets to cover the financial downturn, Blair said that by leading off with the economic situation he "was trying to act as your intelligence officer today, telling you what I thought the Senate ought to be caring about." He said he was not refocusing the intelligence community's basic collection and analytic work from traditional concerns such as terrorism, Afghanistan, Pakistan, Iran, North Korea, Russia and China.

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Update: Pilots Noted Ice Build Up Shortly Before Buffalo Crash
2009-02-13 22:24:28

A flight voice recorder revealed that pilots of a Continental commuter plane talked about "significant icing on the windshield" and "on the leading edge of the wing" moments before crashing into a house outside Buffalo last night, killing 50 people, a federal official said this afternoon.

Shortly after those cockpit comments, as the crew attempted to land the plane by deploying the wing flaps and the landing gear, the plane went into a severe "pitch and roll" that was picked up by the flight data recorder, said Steve Chealander, a member of the National Transportation Safety Board who briefed reporters in New York.

Chealander also said the plane's de-icing system was turned on before the crew talked about the ice buildup, but he said the initial information gathered today from the recorders cannot determine if it was working.

"If the de-icing system was on, the leading edge of the wing and tail should have been clean and icing should have not caused an upset of the aircraft," said Bill Voss, president of the Flight Safety Foundation. "What remains to be seen is there some other malfunction to the de-icing system or other systems. That's a fancy way of saying we don't know why the airplane crashed yet."

Chealander described the final moments of the flight captured on the recorders. He said the crew was briefed on the landing approach and the weather. The landing gear was placed down just one minute before the recording ends, and 20 second later, the flaps' positioning was changed to prepare for landing.

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Lloyds Reveals Potential HBOS Loss Of $16 Billion, Stuns London Financial District
2009-02-13 22:23:40
A shock profits warning by Lloyds Banking Group knocked 32% off the bank's share price Friday and raised speculation that the taxpayer may be forced to take a majority stake in the banking giant created with the intervention of British Prime Minister Gordon Brown.

Eric Daniels, chief executive of the bank formed just under four weeks ago when Lloyds TSB rescued HBOS, was under intense pressure after the admission that HBOS had incurred almost £11 billion ($16) of losses, caused partly by a £1.6 billion deterioration in loans to big companies in the retail and property sectors.

The unusual timing of the announcement - at 1:30 p.m. rather than the more traditional 7 a.m. - followed a board meeting at which the scale of the problem was laid bare. It came barely 48 hours after Daniels had told the Treasury select committee of Parliament members that Lloyds had done between three and five times less due diligence on HBOS than it would usually have done.

Shareholders warned that this might open the door to potential litigation after they voted in favor of the takeover which the prime minister brokered at the height of the banking crisis last September by promising the Lloyds chairman Sir Victor Blank that he would tear up the competition rule book.

The government owns nearly 43% of Lloyds, although some analysts believe this may now rise to a majority holding because the increased losses in the HBOS corporate loan book are eating into the new bank's capital cushion.

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Blackwater Tries To Clean Up Image By Changing Name To Xe
2009-02-13 22:22:04

Blackwater Worldwide is abandoning its tarnished brand name as it tries to shake a reputation battered by oft-criticized work in Iraq, renaming its family of two dozen businesses under the name Xe. The parent company's new name is pronounced like the letter z.

Blackwater Lodge & Training Center - the subsidiary that conducts much of the company's overseas operations and domestic training - has been renamed U.S. Training Center Inc., the company said Friday.

The decision comes as part of an ongoing rebranding effort that grew more urgent following a September 2007 shooting in Iraq that left at least a dozen civilians dead. Blackwater president Gary Jackson said in a memo to employees the new name reflects the change in company focus away from the business of providing private security.

"The volume of changes over the past half-year have taken the company to an exciting place and we are now ready for two of the final, and most obvious changes," Jackson said in the note.

In his memo, Jackson indicated the company was not interested in actively pursuing new private security contracts. Jackson and other Blackwater executives said last year the company was shifting its focus away from such work to focus on training and providing logistics.

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Toyota Cutting U.S. Exec's Pay, Offering Buyouts to 18,000 Workers
2009-02-13 22:21:42
Toyota Motor Corp. is reacting to the slump in U.S. auto sales by further cutting North American production, slashing executives' compensation up to 30 percent and offering buyouts to about 18,000 workers.

"We've taken responsible, step-by-step actions to address this issue in recent months, and we hope the new measures will help us adjust while protecting jobs," said Jim Wiseman, vice president of external affairs for Toyota Motor Engineering & Manufacturing North America in a statement.

The company said Thursday it will cut production days at some U.S. factories in April - from two to eight days according to the amount of inventory at the particular plant.

Toyota is also instituting a shorter work week at some plants. Affected hourly employees would work eight hours less per two-week period, taking a pay cut with the new 72-hour workweek.

Unionized plants in the U.S. and Mexico will not be affected.

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Analysis: Ailing U.S. Banks May Require More Aid To Keep Solvent
2009-02-13 13:13:42

Some of the nation’s large banks, according to economists and other finance experts, are like dead men walking.

A sober assessment of the growing mountain of losses from bad bets, measured in today’s marketplace, would overwhelm the value of the banks’ assets, they say. The banks, in their view, are insolvent.

None of the experts’ research focuses on individual banks, and there are certainly exceptions among the 50 largest banks in the country. Nor do consumers and businesses need to fret about their deposits, which are federally insured. And even banks that might technically be insolvent can continue operating for a long time, and could recover their financial health when the economy improves.

Without a cure for the problem of bad assets, the credit crisis that is dragging down the economy will linger, as banks cannot resume the ample lending needed to restart the wheels of commerce. The answer, say the economists and experts, is a larger, more direct government role than in the Treasury Department’s plan outlined this week.

The Treasury program leans heavily on a sketchy public-private investment fund to buy up the troubled mortgage-backed securities held by the banks. Instead, the experts say, the government needs to plunge in, weed out the weakest banks, pour capital into the surviving banks and sell off the bad assets.

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