Tuesday, December 7, 2010

Obama blinks, reaches deal with GOP to extend tax cuts

WASHINGTON – Brushing past Democratic opposition, President Barack Obama announced agreement with Republicans Monday night on a plan to extend expiring income tax cuts for all Americans, renew jobless benefits for the long-term unemployed and grant a one-year reduction in Social Security taxes.

The emerging agreement also includes tax breaks for businesses that the president said would contribute to the economy's recovery from the worst recession in eight decades.

Obama's announcement marked a dramatic reversal of his long-held insistence, originally laid out in his 2008 campaign, that tax cuts should only be extended at incomes up to $200,000 for individuals and $250,000 for couples. He explained his about-face by saying that he still opposed the move and noted the agreement called for a temporary, two-year extension of cuts at all income levels, not the permanent renewal that Republicans have long sought.

At the same time, it signaled the arrival of a new era of divided government following midterm elections in which Republicans won control of the House and strengthened their hand in the Senate.

"We cannot allow this moment to pass," Obama said.

Officials said that under the plan, unemployment benefits would remain in effect through the end of next year for workers who have been laid off for more than 26 weeks and less than 99 weeks. Without an extension, two million individuals would have lost their benefits over the holidays, the White House said, and seven million would have done so by the end of next year.

The Social Security tax cut would apply to workers, not employers, and would drop from 6.2 percent of pay to 4.2 percent for one year. The White House said the result would be to fatten take-home pay by $120 billion over the course of the year.

In addition, administration officials emphasized that the agreement would extend a variety of other tax breaks for lower and middle-income families, including the Earned Income Tax Credit and the child tax credit.

The estate tax provision under discussion would mean the first $5 million would pass tax-free to heirs. Anything over that would be taxed at a rate of 35 percent. Democrats favored a $3.5 million threshold, with a 45 percent tax on anything higher.

In a sign of Democratic discontent, Senate Majority Leader Harry Reid, D-Nev., reacted curtly to the president's announcement.

"Now that the president has outlined his proposal, Senator Reid plans on discussing it with his caucus tomorrow," his spokesman, Jim Manley, said in a written statement.

Top Republicans were far more receptive.

"I appreciate the determined efforts of the president and vice president in working with Republicans on a bipartisan plan to prevent a tax hike on any American and in creating incentives for economic growth," said Sen. Mitch McConnell of Kentucky, the GOP leader. In a jab at Democratic lawmakers, he added, "I am optimistic that Democrats in Congress will show the same openness to preventing tax hikes the administration has already shown."

Democrats also objected to an extension of the estate tax that tilted toward the Republican position.

For months, Democrats have repeatedly raised objections to including the upper-income in any plan to extend tax cuts enacted in 2001 and 2003 when George W. Bush was president. The Democratic-controlled House recently passed legislation to let the cuts lapse on incomes over $200,000 for individuals and $250,000 for couples. On Saturday, Republicans blocked an attempt by Senate Democrats to do the same.

Obama said he personally opposed elements of the deal, such as an extension of expiring income tax cuts at upper income levels and the more generous deal on estates. But he said he decided that an agreement with Republicans was more important than a stalemate that would have resulted in higher income taxes at all levels on Jan. 1.

"Make no mistake, allowing taxes to go up on all Americans would have raised taxes by $3,000 for a typical American family and that could cost our economy well over a million jobs," he said at the White House.

Obama said the continued political stalemate over taxes amounted to a "chilling prospect for the American people whose taxes are currently scheduled to go up on Jan. 1."

In his announcement, Obama said he had agreed on a bipartisan framework, and said he wanted Congress to approve it before lawmakers adjourn for the year later this month. In a telling sign that the White House recognizes the extent of Democratic opposition, officials said they would prefer the Senate vote first.

Republicans won control of the House last month, and strengthened their hand in the Senate. Even though the newly elected lawmakers don't take their seats until January, Obama has already treated their leaders with far more deference than he has so far in his term. Similarly, McConnell and Rep. John Boehner of Ohio, in line to become House speaker, have seemed willing to strive for compromise with the White House, rather than merely oppose virtually all of the president's initiatives.

Momentum for a year-end deal picked up after Obama met at the White House last week with Republican leaders for the first time since his party's dispiriting election losses, and accelerated again when the government reported last week that joblessness had risen in November, to 9.8 percent.

The flurry of negotiations is taking place with lawmakers eager to wrap up their work for the year and adjourn for the holidays.

Obama, Reid and McConnell have all said in recent days they believe a deal on tax cuts and unemployment benefits is possible by midweek. If so, that would leave time for the Senate to debate and vote on a new arms control treaty with Russia, which Obama has made a top year-end priority.

Senate Republicans have seemed more willing to hold a ratification debate in recent days as the negotiations over taxes intensified, suggesting at least an implicit link between the two issues in the talks

Mbeki ends Ivory Coast poll row talks without deal

ABIDJAN (Reuters) – Former South African leader Thabo Mbeki failed on Monday to settle an election row between Ivory Coast's presidential claimant Alassane Ouattara and incumbent Laurent Gbagbo, but appealed to both for a peaceful solution.

Mbeki had hoped to defuse a power struggle enveloping the country since an election which the electoral commission and international observers say Ouattara won -- a decision reversed by the Constitutional Council, backed by the armed forces chief.

Gbagbo refused to concede defeat after the election commission said the November 28 poll, meant to reunite the region's former economic powerhouse after a 2002-03 civil war, had been won by Ouattara with 54.1 percent of the vote.

Analysts warned the dispute could now pit the army against pro-Ouattara rebels, who told Reuters they would defend themselves against any attack, or even divide the army itself.

"The African Union is very keen that peace can be sustained and every effort should be made to ensure this transition to democracy succeeds," Mbeki told journalists at Gbagbo's house before leaving, adding he would file a report to the union.

"Cote D'Ivoire (Ivory Coast) needs peace and needs democracy ... We indeed hope that the leadership of this country will do all that it can to ensure peace is maintained."

The United Nations is temporarily moving 460 non-essential staff from its mission in Ivory Coast out of the country because of security concerns, a spokesman in New York said.

Ouattara's team at the Golf Hotel, where he is holed up under U.N. protection, held its first 'council of ministers'.

"Everything except the departure of the old president is on the table for negotiation," said Patrick Achi, Ouattara's spokesman, adding that he thought the crisis could be resolved internally, rather than through international sanctions.

Small groups of Ouattara supporters burned tires and blocked roads in Abidjan on Monday as police in riot gear patrolled the streets. There were no reports of violence. At least 10 people were killed in clashes in the previous two weeks.

The military extended a curfew for an extra week, until Sunday, but relaxed the hours to 10 p.m. to 5 a.m.

The political deadlock gripped the world's top cocoa grower after the Constitutional Council -- run by a Gbagbo ally -- scrapped hundreds of thousands of votes from Ouattara strongholds, reversing provisional results giving him victory.

President Barack Obama has backed Ouattara, leading calls from the United Nations, France, the European Union, the African Union and West African bloc ECOWAS on Gbagbo to accept the election commission ruling. ECOWAS leaders are due to hold an emergency summit on Ivory Coast on Tuesday.

REBELS ON ALERT

Gbagbo has scorned the international rejection as an affront to Ivorian sovereignty and has threatened to expel the U.N. Ivory Coast envoy for interference in internal affairs.

Citing a "breakdown of governance," the World Bank and the African Development Bank said they would reassess aid.

Ouattara has named Gbagbo's former finance minister, Charles Koffi Dibby, to his cabinet, a move which would strip Gbagbo of an official praised for his handling of debt talks. Dibby was not available to confirm he had switched sides.

The World Bank tied $3 billion of external debt, estimated to total $12.5 billion, to smooth elections. But Gbagbo's hand on the economy is strengthened by cocoa and oil revenues.

Benchmark ICE cocoa futures traded at a four-month high of $3,028 a metric ton on Monday on fears of supply disruptions.

Despite the stand-off, Ivory Coast reopened its borders on Monday that had been sealed during a tense wait for results.

The army chief of staff has sworn allegiance to Gbagbo and troops appear to be on his side. Ouattara has the open support of the New Forces rebels occupying the north.

"We've put our troops on alert," New Forces spokesman Seydou Ouattara told Reuters. "If we are attacked we will defend our zones and we will take the rest of the Ivorian territory."

Gbagbo has been in power for a decade but faces isolation, though diplomats said Russia, whose Lukoil is exploring for oil in Ivory Coast, has blocked U.N. Security Council efforts to back Ouattara.

The crisis in what was once West Africa's brightest star has forced up the yield on the country's $2.3 billion Eurobond to 11.67 percent, from below 10 percent before polls.

French court: Continental guilty in Concorde crash


PONTOISE, France – Continental Airlines Inc. and one of its mechanics were convicted in a French court of manslaughter Monday because debris from one of its planes caused the crash of an Air France Concorde jet that killed 113 people a decade ago.

The Houston-based airline was ordered to pay Air France euro1.08 million ($1.43 million) for damaging its reputation, in addition to a fine of around euro200,000 ($265,000). The victims of the crash were mostly German tourists.

The presiding judge confirmed investigators' long-held belief that titanium debris dropped by a Continental DC-10 onto the runway at Charles de Gaulle airport before the supersonic jet took off on July 25, 2000, was to blame. Investigators said the debris gashed the Concorde's tire, propelling bits of rubber into the fuel tanks and sparking a fire.

The plane then slammed into a nearby hotel, killing all 109 people aboard and four others on the ground.

Ronald Schmid, a lawyer who has represented several families of the German victims, said he was "skeptical" about the ruling.

"It bothers me that none of those responsible for Air France were sitting in the docks," he told The Associated Press by phone from Frankfurt.

The airline and mechanic, John Taylor, were also ordered to jointly pay more than euro274,000 ($360,000) in damages to different civil parties.

Taylor was also handed a 15-month suspended prison sentence, and a euro2,000 ($2,650) fine. All other defendants — including three former French officials and Taylor's now-retired supervisor Stanley Ford — were acquitted.

The court said Taylor should not have used titanium, a harder metal than usual, to build a piece for the DC-10 that is known as a wear strip. He was also accused of improperly installing the piece that fell onto the runway.

Continental's defense lawyer, Olivier Metzner, confirmed the carrier would appeal. He denounced a ruling that he called "patriotic" for sparing the French defendants and convicting only the Americans.

"This is a ruling that protects only the interests of France. This has strayed far from the truth of law and justice," he said. "This has privileged purely national interests.

Continental spokesman Nick Britton, in a statement, echoed that sentiment, and said the airline disagreed with the "absurd finding" against it and Taylor.

"Portraying the metal strip as the cause of the accident and Continental and one of its employees as the sole guilty parties shows the determination of the French authorities to shift attention and blame away from Air France," he said, noting that Air France was state-run at the time.

Roland Rappaport, a lawyer for the family of Concorde pilot Christian Marty and a pilots union, said the verdict was "incomprehensible" and asked why blame was heaped on Continental mechanics when French officials were aware of weaknesses on the Concorde around two decades before the crash.

"This trial made clear that the Concorde, this superb plane, suffered from severe technical insufficiencies, problems with the fuel tanks that were known since '79," he said outside the courtroom.

The fine delivered against Continental surpassed the euro175,000 ($231,000) fine sought by a state prosecutor, who had requested 18-month suspended prison sentences for both Taylor and Ford.

The prosecution also requested a two-year suspended sentence for Henri Perrier, former head of the Concorde program at former plane maker Aerospatiale. It argued for acquitting French engineer Jacques Herubel and Claude Frantzen, former chief of France's civil aviation authority.

While France's aviation authority concluded the crash could not have been foreseen, a judicial inquiry said the plane's fuel tanks lacked sufficient protection from shock and said officials had known about the problem for more than 20 years.

The families of most victims were compensated years ago, so financial claims were not the trial's focus — the main goal was to assign responsibility. It is not uncommon for such cases to take years to reach trial in France.

Continental is now part of Chicago-based United Continental Holdings Inc., which was formed in October as the holding company owner of United and Continental airlines, which will eventually be combined into a single airline.

In France, unlike in many other countries, plane crashes routinely lead to trials to assign criminal responsibility. It is common for cases to drag on for years.

In 2009, France's highest court finally confirmed the acquittal of all those originally accused of responsibility in an Air Inter crash that killed 87 people in 1992 — 17 years earlier.

Friday, December 3, 2010

WikiLeaks dropped by domain name provider

STOCKHOLM – WikiLeaks' domain name system provider says it has withdrawn service to the wikileaks.org name.

EveryDNS says it dropped the website late Thursday after it became the "target of multiple distributed denial of service attacks."

The American provider says in a statement that the attacks have threatened the stability of its infrastructure.

Thursday, December 2, 2010

Russia World Cup 2018: Another score for Putin


Russia's sports minister likened the geopolitical impact of Russia hosting the 2018 World Cup to the tearing down of the Berlin Wall.


The Christian Science Monitor

Moscow
There was mass exultation in Moscow late Thursday after news broke that Russia has won its bid to host the 2018 World Cup, the first time an eastern European country has ever achieved that honor.

"We go to new lands," Sepp Blatter, president of soccer's governing world body, FIFA, declared as he announced the cliffhanger decision by the organization's 22-member executive committee in Zurich.

For Russians, who love soccer, it looks like much more than a smart marketing decision by FIFA, which aims to expand beyond its traditional turf. Many immediately saw it as yet another indication that their former communist country has come in from the cold and finally acceptance as an important member of the European community.

RELATED: Five things Russia and Qatar did right to win World Cup bids

"It is a huge victory for Russia and a big event for our soccer," says Vladimir Konstantinov, soccer expert with the popular Moscow daily Sport Express. "I hope in eight years' time we'll have a revolutionary new infrastructure for soccer, which we do not have now. This will give an impulse to the economic development of the country, development of transport, service. I have been to several soccer championships and it was always a colossal holiday for the people."

Russia's sports minister likened the geopolitical impact of the win – which saw Russia defeat competition from Britain, Spain, and the Netherlands – to a reenactment of the tearing down of the Iron Curtain.

"Twenty-one years ago the Berlin Wall was broken," declared a triumphant Vitaly Mutko after the announcement. "Today we can break another symbolic wall and open a new era in football together ... Russia represents new horizons for FIFA, millions of new hearts and minds and a great legacy after the World Cup, great new stadiums, and millions of boys and girls embracing the game."

President Dmitry Medvedev tweeted his joy: "Hurrah! Victory! We’re going to host the 2018 World Cup! Now we need to get properly ready to stage the tournament and, of course, to perform honorably," he said on his official Twitter page.

Qatar also won the right to hold the 2022 World cup after defeating competition from the US, Australia, Japan, and South Korea.

U.S. views Chavez in "axis of mischief": WikiLeaks

CARACAS (Reuters) – Cuban intelligence services directly advise Venezuelan President Hugo Chavez in what a U.S. diplomat called the "Axis of Mischief," according to a State Department cable released by the WikiLeaks website.

Other releases by the group revealed U.S. anxiety at Chavez's "coziness" with Iran, and concerns by Venezuelan Jews over what they see as government prejudice against them.

Worries over Cuba's role in Venezuela, a top U.S. oil supplier, were shown in a 2006 diplomatic message. "Cuban intelligence has much to offer to Venezuela's anti-U.S. intelligence services," said the cable posted on wikileaks.org on Wednesday.

During 12 years in office, the socialist Chavez has forged close ties with Cuba's Castro brothers, subsidizing the communist island's economy with cheap oil in return for thousands of doctors and advisers who operate in Venezuela.

Former soldier Chavez has incorporated Cuban-style militias in the armed forces and experts on Venezuela have long said Cuban intelligence services train Chavez's security detail.

The leaked document implied Chavez trusts Cuban information almost more than his own intelligence services.

"Cuban intelligence officers have direct access to Chavez and frequently provide him with intelligence reporting unvetted by Venezuelan officers," the report said.

"Sensitive reports indicate Cuban and Venezuelan intelligence ties are so advanced that the two countries' agencies appear to be competing with each other for the BRV's (Bolivarian Republic of Venezuela's) attention."

The cable was part of a cache of more than 250,000 State Department documents that WikiLeaks released either to media outlets or on its website this week.

It did not reveal the sources behind the "sensitive reports." The document was classified by diplomat Robert Downes, the U.S. Embassy's then political counselor in Caracas.

It was titled "Cuba/Venezuela Axis of Mischief: The view from Caracas," in an apparent reference to former U.S. President George W. Bush's "axis of evil" -- a term for three countries he accused of supporting terrorism.

CONCERNS OVER IRANIAN FRIENDSHIP

Another in a clutch of Caracas embassy cables released by WikiLeaks showed the vulnerability felt by Venezuela's Jewish community given Chavez's political opposition to Israel, with which he broke relations in 2009.

Chavez denies being anti-Semitic, but his fierce words against Israel have been taken by some supporters as a green light for actions like daubing walls with anti-Jewish slogans.

"They believe he has merged his anti-Zionist views with anti-Semitic ones," the 2009 cable said, describing opinions of local Jewish leaders. "The horizon is dark," it quoted one unnamed leader as saying of religious freedom in Venezuela.

Another cable, from 2006 and also classified by Downes, dealt with Chavez's blossoming friendship and "bilateral coziness" with Iranian President Mahmoud Ahmadinejad.

"A shared hatred for the USG (U.S. government) is the driving force" said the cable, describing "Chavez's ill-defined, left-wing, anti-American ideology."

The cable said Venezuela's backing for a nation accused of supporting terrorism and talking of eliminating Israel was a matter of "grave concern."

But rumors of Venezuelan cooperation with a suspected Iranian nuclear arms plan "appear baseless" and "little more than conspiracy-mongering by Chavez adversaries," it said.

Other cables, from 2009, said Venezuela's frequent talk of developing a nuclear energy program was largely scoffed at by local physicists due to the lack of domestic expertise and the enormous financing needed.

Chavez has since said Russia will provide it with a nuclear power plant, but the skepticism remains.

WikiLeaks Founder Assange to TIME: Clinton 'Should Resign'



TIME VIDEO

Hillary Clinton, Julian Assange said, "should resign." Speaking over Skype from an undisclosed location on Tuesday, the WikiLeaks founder was replying to a question by TIME managing editor Richard Stengel over the diplomatic-cable dump that Assange's organization loosed on the world this past weekend. Stengel had said the U.S. Secretary of State was looking like "the fall guy" in the ensuing controversy, and had asked whether her firing or resignation was an outcome that Assange wanted. "I don't think it would make much of a difference either way," Assange said. "But she should resign if it can be shown that she was responsible for ordering U.S. diplomatic figures to engage in espionage in the United Nations, in violation of the international covenants to which the U.S. has signed up. Yes, she should resign over that."

Assange spoke about the latest tranche of documents from WikiLeaks in a 36-minute interview with TIME (the full audio will be available soon on TIME.com). He said there would be more: "We're doing about 80 a day, presently, and that will gradually step up as the other media partners step in." Indeed, every region of the world appears to be bracing for its turn in the WikiLeaks mill. Pakistani officials are almost certain that more revealing documents focusing on their country will come out soon. And the Russian media are anxious to see if future leaks will detail any behind-the-scenes dealings over the August 2008 Russia-Georgia war. (See a TIME profile of Julian Assange.)

Assange said that all the documents were redacted "carefully." "They are all reviewed, and they're all redacted either by us or by the newspapers concerned," he said. He added that WikiLeaks "formally asked the State Department for assistance with that. That request was formally rejected."



Asked what his "moral calculus" was to justify publishing the leaks and whether he considered what he was doing to be "civil disobedience," Assange said, "Not at all. This organization practices civil obedience, that is, we are an organization that tries to make the world more civil and act against abusive organizations that are pushing it in the opposite direction." As for whether WikiLeaks was breaking the law, he said, "We have now in our four-year history, and over 100 legal attacks of various kinds, been victorious in all of those matters." He added, "It's very important to remember the law is not what, not simply what, powerful people would want others to believe it is. The law is not what a general says it is. The law is not what Hillary Clinton says it is." (See a TIME video with Julian Assange on the top 10 leaks.)

And the source or sources of all the diplomatic cables? Stengel asked Assange if U.S. Army PFC Bradley Manning, now detained in Quantico, Va., was the sole source of the megaleak. "We're a source-protection organization," Assange said, "so the last thing we would do is discuss possible sources. However, we do know that ... the FBI, State Department and U.S. Army CID [Criminal Investigation Command] has been going around Boston visiting a number of people there." He referred to "people who have been detained coming back into the United States" with connections to Manning. The U.S. soldier's "mother's home in Wales, in the U.K.," he said, was "visited, or raided, depending on how you want to describe it," by the FBI.

Stengel asked what was coming next from WikiLeaks. "We don't have targets," said Assange, "other than organizations that use secrecy to conceal unjust behavior ... That's created a general target." A story in Forbes magazine, which interviewed Assange before the latest leak, said that WikiLeaks has a large U.S. financial corporation in its sights. Assange confirmed that. "Yes, the banks are in there. Many different multinational organizations are in the upcoming weeks, but that is a continuation of what we have been doing for the past four years" since WikiLeaks was founded. He added that the volume of material has increased. "The upcoming bank material is 10,000 documents, as opposed to hundreds, which we have gotten in the other cases."