Monday, 10 November 2008

A Place in the Auvergne, Sunday, 9th November 2008


Once inspired by a war, now by the land
By Carol Kino
Sunday, November 9, 2008
MOUNTAINVILLE, New York: ON a gray, unusually muggy October day the artist and architect Maya Lin was showing a visitor around "Wave Field," her new earthwork project at the Storm King Art Center here. The 11-acre installation, which will open to the public next spring, consists of seven rows of undulating hills cradled in a gently sloping valley. Lin clambered nimbly up and down them, regarding each nook, cranny and blade of grass with something of a proprietary air.
"It's part of a study that started with looking at a simple water wave," she explained en route, "and how does the wave begin or end." Given that she was working with land, not water, she added, "I was almost afraid to start it."
From a neighboring hill came the delighted screams of children at play: Lin's daughters, India, 11, and Rachel, 9, and one of Rachel's friends.
Seen from afar the piece does suggest an expanse of ocean waves that have been frozen in place, as well as many other things: snowdrifts, a Zen moss garden, perhaps a cluster of the American Indian burial mounds that can be found in the hills of southeastern Ohio, where Lin grew up.
With its sense of having arisen naturally from the earth, the earthwork also recalls Lin's Vietnam Veterans Memorial, the design for which catapulted her to stardom and notoriety in 1981, when she was a 21-year-old senior at Yale.
Yet as soon as you walk into the piece, whose earthen swells range in height from 12 to 18 feet, your experience of it changes remarkably. At first, standing at the bottom of a slope, it may look craggy and insurmountable. But in scaling it — which turns out to be relatively easy because of the rough surface — you become keenly aware of the earth itself, currently a patchy mix of topsoil, short grass, clover, white daisies and yellow-flowered partridge pea, which attracts swarms of monarch butterflies.
"This stuff was just rock-laden soil," Lin said, stooping to finger the plants, which were seeded by hand. "It will all end up being field. You don't want it to turn into a golf course. You basically want whatever is around here naturally to take root. You're after something that doesn't look premeditated and too cultivated."
Then she happened across a large tunnel burrowed into the side of a wave. "Oh my God!" she cried. "A groundhog hole!"
India suddenly scrambled into view, shouting, "Mommy, we counted five of them!"
Lin laughed and then paused, reflecting, "I think we'll cover it up?" But within moments she had changed her mind. "I think you have to let it be what it's going to be," she said.
In a sense that has been her mantra throughout the project.
Eight years ago, when she was first invited to visit Storm King to start thinking about making a piece, she found herself strangely attracted to an overlooked area known around the art center as the gravel pit. Located on the property's southwestern edge, about 100 feet beyond Andy Goldsworthy's "Storm King Wall" (1997-98), it was a reminder of what Storm King looked like in 1960, the year it opened.
Back then much of Storm King's landscape consisted of acres of gravel that had been mined from the surrounding fields in the 1950s in connection with the construction of the New York State Thruway. Over the years the art center used this rocky material to shape its grounds, creating the seemingly natural hills and valleys that now are dotted with sculptures and site-specific works by artists like David Smith, Isamu Noguchi and Goldsworthy.
"It's a man-made landscape, bringing gravel in and reshaping it," said David Collens, the director of Storm King. "That's the untold story about the art center." And as soon as Lin saw the pit, he said, "her eyes lit up, and that was it for her."
Lin said: "I've tended to create works on the edges and boundaries of places, so the work becomes less of a centerpiece. I'm very interested in exploring works that begin to own the environment."
By the time she finally proposed the piece to Storm King's board in 2006, she had already completed two smaller-scale "Wave Field" earthworks, the first at the University of Michigan in Ann Arbor, the second for the courtyard of the Wilkie D. Ferguson Jr. federal courthouse in Miami. "I always knew that I wanted to culminate the series with a field that literally, when you were in it, you became lost inside it," she said, "so the waves had to become much larger than you." To her the gravel pit seemed perfect for this concluding piece, which will also be Storm King's first earthwork.
Because the site was officially a mine, Collens had to secure permission from the state Environmental Conservation Department to reclaim it as an artwork. The department has strongly supported the project. Because Lin is "a committed environmentalist," as she put it, she was intent on using minimal intervention to turn it into an artwork and making the most of what was already there.
That meant gently grading the site and using its largest rocks to create an underlying structure that would provide the piece with natural drainage, a project she accomplished with the aid of the landscape architect Edwina von Gal. The waves and the bowl-like valley in which they rest were largely built from the gravel and earth in the pit itself as well as a berm that had shielded the site from view. Here Lin relied heavily on Frank Tantillo, a local landscaper. "You need to find a contractor who's sympathetic and really supportive," she said, "because they're basically sculpting the landscape with a bulldozer."
By the time the piece opens to the public next spring, it will be shielded from the Thruway by about 270 young trees — a mix of maple, oak, sycamore and other local natives. That's how many trees Lin's studio staff has calculated it will take to offset the fuel and energy consumed in making the piece, including the artist's own frequent car trips from New York. "I might actually look for more trees that can take hotter weather and make them more predominant," Lin said. "I'm a firm believer that global warming is happening."
And then there are the grasses. Chosen by Darrel Morrison, a landscape restoration expert who consults on all the tall grasses planted at Storm King, they are a native mix that should require little maintenance or watering. By spring tall plants like deertongue and Canada bluegrass will have taken over from the ground cover that now holds the topsoil in place. At that point, Lin said: "The grass will flow in the wind and feel more like water. Although of course you're not trying to recreate water. It begins to be its own formal play."
In a sense Lin's entire career has been interplay among what she regards as three separate strands: she is an architect and an artist, and she also designs memorials (she likes to call them anti-monuments) that fall somewhere between the two. She has been pursuing all three directions since she finished the Vietnam memorial in 1982. That project transformed her into something of an instant celebrity, and she was offered a number of architectural commissions as a result. But Lin, who in person is strikingly friendly and unassuming, does not seem to have let the experience turn her head.
"There's a part of me that's oddly shy," she said. "And I tend to take my time. I didn't want to produce work that wasn't quite ready." So she decided to "maintain course" by earning a master's degree in architecture at Yale.
While studying the art of building design in graduate school, Lin found herself spending more and more time in the sculpture studios of the Yale art department, working with her hands. "I was called an architect, and I loved building," she said, "but at the same time there was this other side of me that was beginning to differentiate itself."
Soon after graduating, she designed her second monument, the Civil Rights Memorial at the Southern Poverty Law Center in Montgomery, Alabama, which was dedicated in 1989. By 1993 she had completed her first major building, for the Museum of African Art in SoHo, which is now defunct.
Since then she has worked consistently in all three areas, often developing ideas for one sort of project while working on another. In 1993 she created her first site-specific sculpture for the Wexner Center for the Arts in Columbus, Ohio. Called "Groundswell," it consisted of 40 tons of broken tempered glass poured into snowdriftlike piles around the museum's exterior walls. From this came the idea for her first earthwork, "Wave Field," in Michigan, which she completed in 1995. That in turn led her back to the studio, where for a time she focused on making sculpture.
Making sculpture as well as drawings and maquettes is at the heart of everything Lin does, as becomes clear when you enter her studio, a 2,600-square-foot loft in the heart of SoHo. Much of the space is occupied by her assistants, who carry out the mathematical and topographical data collection, analysis and computer modeling that are crucial to her work. But by the doorway there is a small area where, she said, "I literally get to disappear and make the sculptures."
The room is full of small artworks, most of which suggest the earth in some form or another. There is also a group of colorful asteroidlike objects made from discarded (and nonrecyclable) plastic toys and bottle caps. "It's really important that I get to make things by hand," Lin said. "I think when you're working with bulldozers, when everything you're doing is translated through a fairly large-scale machined operation, just to be able to come back here is really crucial to my creativity."
She also makes some work at home, an apartment on the Upper East Side that she shares with her children and her husband, Daniel Wolf, a photography dealer. "I've always made work in my bedroom, basically," she said.
Many of her larger sculptures and installations can be seen in "Systematic Landscapes," an exhibition that opened at the Henry Art Gallery in Seattle in April 2006 and is now at the de Young Museum in San Francisco. It includes three focal installations, all made in 2006. "2 x 4 Landscape" is an earthworklike mound with a pixelated appearance that was built from two-by-fours.
"Water Line," based on remote Bouvet Island in the South Atlantic, is a topographical rendering built with aluminum tubing and suspended from the walls — a kind of three-dimensional drawing — so that visitors can walk beneath it. Then there is "Blue Lake Pass," a model of the Colorado mountain range where Lin and her family spend summers. Made from particle board, it is cut into cross-sections that visitors can walk among. While making these works, Lin said, her overall impulse was "to take the aesthetic of 'Wave Field' and bring it indoors."
In the past Lin has always conceived of her different career strands as separate. "I think it may be the only way I can keep myself balanced," she said. Although she is also working on a commission for the Museum of Chinese in America in Chinatown in New York, she is reluctant to talk about such projects and her artwork in the same breath. "It kind of confuses people," she said.
Yet recently she has been coming around to the idea that the strands may be intertwined. "My greatest fear 15 years ago is that the different parts weren't in dialogue with each other," she said. "But whether it's art, architecture or memorials, I realize now that all my work is intrinsically tied to the natural landscape around us."

The climate for change
By Al Gore
Sunday, November 9, 2008
The inspiring and transformative choice by the American people to elect Barack Obama as our 44th president lays the foundation for another fateful choice that he - and we - must make this January to begin an emergency rescue of human civilization from the imminent and rapidly growing threat posed by the climate crisis.
The electrifying redemption of America's revolutionary declaration that all human beings are born equal sets the stage for the renewal of U.S. leadership in a world that desperately needs to protect its primary endowment: the integrity and livability of the planet.
The world authority on the climate crisis, the Intergovernmental Panel on Climate Change, after 20 years of detailed study and four unanimous reports, now says that the evidence is "unequivocal." To those who are still tempted to dismiss the increasingly urgent alarms from scientists around the world, ignore the melting of the north polar ice cap and all of the other apocalyptic warnings from the planet itself, and who roll their eyes at the very mention of this existential threat to the future of the human species, please wake up. Our children and grandchildren need you to recognize the truth, before it is too late.
Here is the good news: The bold steps that are needed to solve the climate crisis are exactly the same steps that ought to be taken in order to solve the economic crisis and the energy security crisis.
Economists across the spectrum agree that rapid investments in a jobs-intensive infrastructure initiative is the best way to revive the U.S. economy in a quick and sustainable way. Many also agree that our economy will fall behind if we continue spending billions of dollars on foreign oil. Moreover, national security experts in both parties agree that we face a dangerous strategic vulnerability if the world suddenly loses access to Middle Eastern oil.
Thirty-five years ago this past week, President Richard Nixon created Project Independence, which set a national goal that, within seven years, the United States would develop "the potential to meet our own energy needs without depending on any foreign energy sources." His statement came three weeks after the Arab oil embargo had sent prices skyrocketing and woke America to the dangers of dependence on foreign oil. And it came only three years after U.S. domestic oil production had peaked.
At the time, the United States imported less than a third of its oil from foreign countries. Yet today, after all six of the presidents succeeding Nixon repeated some version of his goal, our dependence has doubled from one-third to nearly two-thirds - and many feel that global oil production is at or near its peak.
Some still see this as a problem of domestic production. If we could only increase oil and coal production at home, they argue, then we wouldn't have to rely on imports. Some have come up with even dirtier and more expensive ways to extract the same old fuels, like coal liquids, oil shale and "clean coal" technology.
But in every case, the resources in question are much too expensive or polluting, or, in the case of "clean coal," too imaginary to make a difference in protecting either our national security or the global climate. If the coal industry can make good on this promise, then I'm all for it. But until that day comes, we simply cannot any longer base the strategy for human survival on a cynical and self-interested illusion.
Here's what we can do - now: We can make an immediate and large strategic investment to put people to work replacing 19th-century energy technologies that depend on dangerous and expensive carbon-based fuels with 21st-century technologies that use fuel that is free forever: the sun, the wind and the natural heat of the earth.
What follows is a five-part plan to repower America with a commitment to producing 100 percent of our electricity from carbon-free sources within 10 years.
First, the new president and the new Congress should offer large-scale investment incentives for the construction of concentrated solar thermal plants in the Southwestern deserts, wind farms in the corridor stretching from Texas to the Dakotas and advanced plants in geothermal hot spots that could produce large amounts of electricity.
Second, we should begin the planning and construction of a unified national smart grid for the transport of renewable electricity from the rural places where it is mostly generated to the cities where it is mostly used. The cost of this modern grid - $400 billion over 10 years - pales in comparison with the annual loss to American business of $120 billion due to the cascading failures that are endemic to our current balkanized and antiquated electricity lines.
Third, we should help America's automobile industry (not only the Big Three but the innovative new startup companies as well) to convert quickly to plug-in hybrids that can run on the renewable electricity that will be available as the rest of this plan matures. In combination with the unified grid, a nationwide fleet of plug-in hybrids would also help to solve the problem of electricity storage.
With this sort of grid, cars could be charged during off-peak energy-use hours; during peak hours, when fewer cars are on the road, they could contribute their electricity back into the national grid.
Fourth, we should embark on a nationwide effort to retrofit buildings with better insulation and energy-efficient windows and lighting. This initiative should be coupled with the proposal in Congress to help Americans who are burdened by mortgages that exceed the value of their homes.
Fifth, the United States should lead the way by putting a price on carbon here at home, and by leading the world's efforts to replace the Kyoto treaty next year in Copenhagen with a more effective treaty that caps global carbon dioxide emissions and encourages nations to invest together in efficient ways to reduce global warming pollution quickly, including by sharply reducing deforestation.
Of course, the best way to secure a global agreement to safeguard our future is by re-establishing the United States as the country with the moral and political authority to lead the world toward a solution.
Looking ahead, I have great hope that we will have the courage to embrace the changes necessary to save our economy, our planet and ultimately ourselves.
In an earlier transformative era, President John F. Kennedy challenged our nation to land a man on the moon within 10 years. Eight years and two months later, Neil Armstrong set foot on the lunar surface. The average age of the systems engineers cheering on Apollo 11 from the Houston control room that day was 26, which means that their average age when Kennedy announced the challenge was 18.
This year similarly saw the rise of young Americans, whose enthusiasm electrified Barack Obama's campaign. There is little doubt that this same group of energized youth will play an essential role in this project to secure our national future, once again turning seemingly impossible goals into inspiring success.
Al Gore, vice president of the United States from 1993 to 2001, was the co-recipient of the Nobel Peace Prize in 2007.



Crisis and opportunity
By Ban Ki Moon, Susilo Bambang Yudhoyono, Donald Tusk and Anders Fogh Rasmussen
Sunday, November 9, 2008
As world leaders gather in Washington this weekend, they would do well to remember that we face two crises. The global financial crisis is most immediate; the more existential is climate change. The urgency of the first is no excuse for neglecting the second. On the contrary, it is an opportunity to kill two birds with one stone.
Let us make the case purely in terms of pragmatic economics. Global growth is slowing. Budgets are tightening. We will likely have fewer resources to tackle a lengthening agenda of global problems. What steps can we take, then, to create jobs and spur growth? How can we assure energy supplies at affordable prices? What must we do to insulate the global financial system from recurring shocks and cyclical bubbles, so that people of all nations can live in economic security?
The answer is to find common solutions to the grave challenges facing us. And when it comes to two of the most serious - the financial crisis and climate change - that answer is the green economy. Scientists agree: To address climate change, we need an energy revolution, a wholesale change in how we power our societies. Economists agree as well: The hottest growth industry in the world is renewable energy. That's where the jobs of the future are already being created, and where much of the technological innovation is taking place that will usher in the next era of economic transformation.
Practical philosophers remind us that tomorrow begins today. Yes, this weekend's financial summit in Washington is critical. But we face no less a test in early December, when nations gather in Poznan, Poland, for the next round of UN climate convention negotiations. The meeting marks the half-way point along the Bali road map, embraced in Indonesia last year. It aims to set the stage for a grand bargain in Copenhagen next December, when world leaders come together to negotiate an ambitious climate change agreement that all nations can embrace.
At Poznan, environment and climate ministers will meet for the first time to chart out a long-term vision of cooperative action. To reach a deal in Copenhagen, we need a clear work-plan with specific goals for reducing emissions and adapting to the adverse effects of climate change. We need an agreed institutional architecture, a serious commitment to an Adaptation Fund and, above all, a willingness of both developing and developed nations to do their part. Financing will be key. If developing nations lack the financial resources and technologies to "go green," we cannot effectively fight climate change.
Wishes do not automatically translate into deeds. But let us be clear: That is what businesses, investors, governments and citizens' groups want. In fact, it is already happening. The UN Environment Program estimates that global investment in zero-greenhouse energy will reach $1.9 trillion by 2020 - a significant portion of global GDP. Worldwide, nearly two million people are employed in the new wind and solar power industries, half of them in China alone. Brazil's biofuels program has been creating nearly a million jobs annually. In Germany, investments in environmental technology are expected to quadruple over the coming years, reaching 16 percent of manufacturing output by 2030 and employing more workers than the automobile industry.
We do not need to await the arrival of new technologies, nor need we worry excessively about the costs of taking action. Studies show that the United States could cut carbon emissions significantly at low or near-zero cost, using existing know-how. For evidence, consider how Denmark has invested heavily in green growth. Since 1980, GDP increased 78 percent with only minimal increases in energy consumption. Poland has cut emissions by a third over the past 17 years through aggressive energy-efficiency measures, even as its economy boomed. For businesses, such savings translate into profits. Today, European companies in the green tech sector enjoy substantial "first mover" advantages, accounting for one third of the world's burgeoning market in environmental technologies.
With the right policies and incentives we can steer economic growth in a low-carbon direction. With the right policies and the right incentives, we can be sure that developed and developing countries alike contribute to the cause of fighting global warming, without compromising every nation's right to the economic well-being of its citizens.
The most forward-looking chief executives know this. That's one reason why businesspeople in so many parts of the world are demanding clear and consistent policies on climate change. Let us accept that there are many paths to Rome. In Poznan, and later in Copenhagen, some will seek strict emissions limits. Others will prefer voluntary targets. Still others will debate the pros and cons of "cap-and-trade" carbon markets versus taxes and national conservation regulation. Many will call for policies to reduce deforestation, accounting for roughly a fifth of green-house gas emissions. Investment of $17 billion to $30 billion annually could halve that amount while boosting conservation-related employment in tropical countries like Indonesia
We need all of these approaches. Even more, we will need leadership. The global financial crisis is a wake-up call. It requires innovative solutions that take into account the larger challenges we face. It is not an invitation to defer what needs to be done to safeguard our future. We have no more time to lose.
Ban Ki Moon is secretary general of the United Nations, Susilo Bambang Yudhoyono is president of Indonesia, Donald Tusk is prime minister of Poland and Anders Fogh Rasmussen is prime minister of Denmark.


Study shows wider benefits of statins, and wider markets
By Pam Belluck
Sunday, November 9, 2008
NEW YORK: A large new study suggests that millions more people could benefit from taking the cholesterol-lowering drugs known as statins, even if they have low cholesterol, because the drugs can significantly lower their risk of heart attacks, strokes and death.
The study, involving nearly 18,000 people worldwide, tested statin treatment in men 50 and older and in women 60 and older who did not have high cholesterol or histories of heart disease. What they did have was high levels of a protein called high-sensitivity C-reactive protein, or CRP, which indicates inflammation in the body.
The study, presented Sunday at an American Heart Association convention in New Orleans and published online in The New England Journal of Medicine, found that the risk of heart attack was more than cut in half for people who took statins.
Those people were also almost 50 percent less likely to suffer a stroke or need angioplasty or bypass surgery, and they were 20 percent less likely to die. The statin was considered so beneficial that an independent safety monitoring board stopped what was supposed to be a five-year trial last March after less than two years.
Scientists said the research could provide clues on how to address a long-confounding statistic: that half of heart attacks and strokes occur in people without high cholesterol.
"These are findings that are really going to impact the practice of cardiology in the country," said Dr. Elizabeth Nabel, director of the National Heart, Lung and Blood Institute, which was not involved in the research. "It's at a minimum an extremely important study and has the potential to be a landmark study."
The study is sparking debate over who should take a blood test to check CRP and under what circumstances someone with high CRP should be given a statin. Because heart disease is a complex illness affected by many risk factors — including smoking, hypertension, being overweight and having a family history of heart disease — most researchers said high CRP alone should not justify prescribing statins to people who have never had heart problems.
Some experts cautioned against testing people for CRP unless they had other indications of being at risk for heart disease, and they said more research was needed to pinpoint the patients for whom the benefit of statins outweighs the risks. Others recommended testing more frequently and using statins for people with low cholesterol if they have high CRP and some other risk factors.
The study, called Jupiter, is also fueling a debate among scientists about CRP's importance and inflammation's role in heart disease.
Nabel said national panels were likely to revise their official guidelines for doctors, which she described as "silent on CRP," to recommend CRP testing and statin therapy for some people not previously considered candidates.
Current practice, she said, is to treat people with high cholesterol with statins, and to counsel people at low risk for heart disease about diet and exercise.
"What cardiologists have never known what to do about is the intermediate range" of patients, Nabel said, who may be overweight, smoke or have hypertension, but do not have the most serious red flags of high cholesterol or diabetes. "I think CRP will emerge as a new risk factor added to traditional risk factors."
The leader of the Jupiter study, Dr. Paul Ridker, director of the Center for Cardiovascular Disease Prevention at Brigham and Women's Hospital in Boston, said his team estimated that expanding statin use to the types of patients he studied could prevent about 250,000 heart attacks, strokes, vascular procedures or cardiac deaths over five years.
Some experts not involved in the Jupiter study said several million more Americans should probably be taking statins.
"The Jupiter trial very convincingly used CRP as a way to identify another group of high-risk individuals who wouldn't otherwise have been treated, and supports the concept that those people should be treated with a statin," said Dr. Daniel Rader, a heart researcher at the University of Pennsylvania School of Medicine who was not connected to the study.
Several experts said that although the research was significant and would affect clinical practice, the study as published in the journal did not give enough detailed information to indicate exactly which patients should now be tested for CRP or given statins.
In an accompanying editorial, Dr. Mark Hlatky, a professor of health research at Stanford University, said among other things that the study, which tested people with CRP levels over two milligrams, did not indicate whether that level or a higher CRP level should be the threshold for treatment. The study also did not answer some questions about risks of giving statins to relatively healthy people, he wrote.
Dr. Sidney Wolfe, director of the health research group for Public Citizen, a nonprofit consumer advocacy organization, said the Jupiter study also did not give enough detail about the effect of statins on participants who had only high CRP, compared with those who also smoked or had a condition called metabolic syndrome. Some experts questioned whether stopping the trial early had limited the possibility of some more meaningful data.
Ridker said the published study, as well as unpublished data, indicated that all the statin-takers experienced the same benefit, including those considered "very low risk" because they have no risk factors other than high CRP. "We have no evidence at all that stopping early adversely impacted on anything," he said in an e-mail response, adding, "I think people may simply not have had the time to carefully read the paper yet, and the data so much challenge what they believe to be true that it will take some time to sink in."
The trial was one of the few to test statins that included many women, Hispanics and blacks, groups that all showed similar benefit from statins.
Like many clinical trials, Jupiter was sponsored by a pharmaceutical company, in this case AstraZeneca. It makes the drug in the trial, rosuvastatin, which is sold as Crestor. The most potent statin on the market, Crestor has been criticized by consumer health advocates who say it is more likely to cause some rare side effects of statins — muscle deterioration and kidney problems.
In 2005, the Food and Drug Administration rejected a petition by Public Citizen to ban Crestor, saying its risks were not substantially different from similar drugs.
In the Jupiter study, in which people either got rosuvastatin or a placebo, there was no increase in muscle or kidney problems for those taking the statin. There was a small increase in diabetes.
Dr. Timothy Gardner, president of the American Heart Association, said some recent statin trials "have been either negative or in some ways concerning in terms of complications," but, he added, "this one is pretty clearly a winner for statin therapy."
Ridker, a co-inventor of a CRP test, said he first sought U.S. financing for the study and was turned down. He and the other scientists interviewed for this article, except for Nabel, Gardner and Wolfe, have consulted for or received research money from companies that make statins.
Although Crestor, which has 9 percent of the American cholesterol-lowering market and costs about $3 a day, was used in this study, several experts said it seemed likely that the effect would be the same for other statins in appropriate doses, including generics, which are much cheaper.
Lisa Nanfra, executive director of commercial operations for AstraZeneca, said the company believed there was a "unique profile of Crestor" and that the drug was "the most effective statin at lowering" bad cholesterol. The company plans to use results from the Jupiter study to seek FDA approval to widen its claim about Crestor's effectiveness.
The role of CRP and inflammation in heart disease is hotly debated.
Ridker believes inflammation plays an important role, probably by causing plaque in the coronary arteries to rupture.
"Screening for cholesterol alone is like having two passengers in a car but only one air bag," he said. "If we're not screening for CRP, we don't have the opportunity to save that person's life."
Others say cholesterol is much more important. Dr. Scott Grundy, a heart expert at the University of Texas Southwestern Medical Center, pointed out that in the Jupiter study, the statin not only lowered CRP but also significantly cut already low cholesterol levels, raising questions about whether the benefit actually came from giving patients superlow cholesterol. And because CRP can rise with short-term infections unrelated to chronic inflammation, some experts said results of a CRP test needed to be weighed against other aspects of the patient's health.
"CRP is not a standard test that everyone should have," Rader said. "It is an additional test that you should do if you're on the fence."
Dr. Andrew Tonkin, head of cardiovascular research at Monash University in Melbourne, Australia, said though the results for those who took the statin were "strikingly positive," given that the people in the study were relatively healthy, there needed to be a cost-benefit analysis to decide: "Are there people in whom the potential gains, although significant, are not so great as to warrant taking statins?"

Souped-up immune cells catch even disguised HIV
Sunday, November 9, 2008
By Maggie Fox, Health and Science Editor
Genetically engineered immune cells can spot the AIDS virus even when it tries to disguise itself, offering a potential new way to treat the incurable infection, researchers reported on Sunday.
The killer T-cells, dubbed "assassin" cells, were able to recognise other cells infected by HIV and slow the spread of the virus in lab dishes.
If the approach works in people, it might provide a new route of treating infection with the deadly human immunodeficiency virus, the researchers in the United States and Britain said.
"Billions of these anti-HIV warriors can be generated in two weeks," said Angel Varela-Rohena of the University of Pennsylvania, who helped lead the study.
In a second, unrelated report, researchers testing Dutch biotechnology firm Crucell NV's experimental AIDS vaccine said it prevented infection in six monkeys.
The animals were infected with a monkey version of HIV called SIV, and the vaccine used a virus that is dangerous to use in humans, so it is not ready for human tests.
But, writing in the journal Nature, Dr. Dan Barouch of Beth Israel Deaconess Medical Centre and Harvard Medical School in Boston and colleagues said it shows there is still hope for developing a vaccine against AIDS.
The AIDS virus, which infects 33 million people globally, is especially hard to fight. Like all viruses, it hijacks cells in its victims, forcing them to become little viral factories and make more virus.
HIV is even more insidious, attacking immune system cells called CD4 T cells, which help mount a defence. It can also disguise itself to escape CD8 killer cells, also known as cytotoxic T lymphocytes or CTLs.
"CTLs are crucial for the control of HIV infection. Unfortunately, HIV has an arsenal of mutational and nonmutational strategies that aid it in escaping from the CTL response mounted against it by its host," the researchers wrote in their report, published in the journal Nature Medicine.
One good defence allows HIV to hide a protein called HLA-I-associated antigen.
Varela-Rohena and colleagues took T-cells from an HIV patient and created a genetically engineered version that recognizes this deception.
"It is possible to improve on nature when it comes to preventing HIV CTL escape," they wrote.
Not only could the engineered T-cells see HIV strains that had escaped detection by natural T-cells, "but the engineered T cells responded in a much more vigorous fashion so that far fewer T-cells were required to control infection," Penn's James Riley, who also worked on the study, said in a statement.
"In the face of our engineered assassin cells, the virus will either die or be forced to change its disguises again, weakening itself along the way," added Andy Sewell of Cardiff University.
Perhaps having to mutate will weaken the virus, the researchers said.
They plan to test the T-cell treatment in HIV patients next year.
"We have managed to engineer a receptor that is able to detect HIV's key fingerprints and is able to clear HIV infection in the laboratory," said Bent Jakobsen, chief scientific officer at Adaptimmune, a British company launched in July that owns the rights to the technology. "If we can translate those results in the clinic, we could at last have a very powerful therapy on our hands."
(Reporting by Maggie Fox; Editing by Cynthia Osterman)

Bicycle-sharing mania takes hold in Europe
By Elisabeth Rosenthal
Sunday, November 9, 2008
BARCELONA: In increasingly green-conscious Europe, there are said to be only two kinds of mayors: those who have a bicycle-sharing program and those who want one.
Over the past several years, the programs have sprung up and taken off in dozens of cities, on a scale no one had thought possible and in places where bicycling had never been popular.
The sharing plans include not just Paris's Vélib', with its 20,000 bicycles, but also wildly popular programs with thousands of bicycles in major cities like Barcelona and Lyon. Programs operate in Pamplona, Spain; Rennes, France; and Düsseldorf. Even Rome, whose narrow, cobbled streets and chaotic traffic would seem unsuited to pedaling, recently started a small trial program, Roma-n-Bici, which it plans to expand soon.
For mayors looking to ease congestion and prove their environmental bona fides, bike-sharing has provided a simple solution: For the price of a bus, they get a fleet of bicycles, and they can avoid years of construction and the approvals required for a subway. For riders, joining means cut-rate transportation - as well as a chance to contribute to the planet's well-being.
The new systems are successful in part because they blanket cities with huge numbers of available bikes, but the real linchpin is technology. Aided by electronic smart cards and computerized bike stands, riders can pick up and drop off bicycles in seconds at hundreds of locations, their payments deducted from bank accounts.
"As some cities have done it, others are realizing they can do it, too," said Paul DeMaio, founder of MetroBike, a U.S.-based bike-sharing consultant that tracks programs worldwide. "There is an incredible trajectory."
The huge new European bicycle-sharing networks function less as recreation and more as low-cost, alternative public transportation. Most programs (though not Paris's and Lyon's) exclude tourists and day-trippers.
Here in Barcelona, streets during rush hour are lined with commuters and errand-goers on the bright red bicycles of Bicing, the city's 18-month-old bike-sharing program. Bicing offers 6,000 bicycles from 375 stands scattered every few blocks; all the bikes seem to be in nearly constant motion.
"I use it every day to commute - everyone uses it," said Andre Borao, 44, an entrepreneur in a gray suit with an orange tie, as he prepared to ride home for lunch. "It's convenient, and I like the perspective of moving through the streets."
The expanding program in Barcelona is typical of so-called third-generation programs that rely heavily on technology. (In its first generation, bike-sharing involved scattering old bikes around the streets of Copenhagen, where they could be used for free; second-generation programs accepted coins.)
Here, customers buy a yearly membership for about $30 and get a smart card that allows them to release a bike from a mechanized dock. The first 30 minutes are free, with a charge thereafter of 30 cents for each half-hour. Bikes must be returned within two hours, or members face smart-card deactivation, but they can be returned to any bike rack in the network.
Programs in Germany and Austria tend to work on a different system: Members receive cellphone text messages providing codes to unlock the bikes.
Cities like Copenhagen and Amsterdam have long been home to devoted bicycling commuters. But the new programs have created the greatest transportation revolution in central and southern Europe, where warmer climates allow riders to move about comfortably year-round. The shared bicycles in Barcelona, Lyon and Paris are heavily used - logging about 10 rides a day, according to officials in those cities.
In North America, issues like insurance liability, a stronger car culture, longer commutes and a preference for wearing helmets have slowed adoption of bicycle-sharing programs. None of the European programs mandate helmets. Still, Washington and Montreal are experimenting with small projects, and Chicago, Boston and New York are studying options.
Perhaps the best indication that bicycle-sharing has arrived is this: Shanghai, which 10 years ago was trying to eliminate bicycles from some of its boulevards to make way for cars, last month opened a pilot bike-sharing stand.
In most European cities, advertisers have been given contracts to set up and maintain bicycle-sharing programs in exchange for the rights to sell ads on city-owned space, like bus stations.
"We provide a turn-key program," said Martina Schmidt, bike-sharing director of Clear Channel Outdoors, which now runs programs in 13 European cities and recently started its first American program, the one in Washington. "We give the city what they're looking for, and they give us space to sell."
Here in Barcelona, the Bicing program has had its glitches, reflecting, in part, its unexpected popularity.
On Barcelona's outskirts, users complain that bicycle stations (with up to 36 bikes) can run out toward the end of the morning rush hour, leaving customers temporarily stranded. Likewise, docking sites in central Barcelona are sometimes full, so riders have to search for parking. Car owners complain about the removal of parking spots to accommodate new bike lanes; the city has about 130 kilometers, or 80 miles, of lanes, a number that has rapidly expanded in the past two years.
Barcelona's central business district is in a geographic bowl compared with most residential neighborhoods, so while many people want to ride there to work, fewer want to ride a bike home. Directed by controllers at a command station, Bicing's 100 employees use trucks to rebalance the system, taking bikes to where they are needed.
City officials seem a bit overwhelmed.
"For the moment, it will not grow anymore," said Ramón Ferreiro, an official with Bicing. "We now have to consolidate and start working so that maintenance is adequate, and improve the system at all levels."
Even with the growing pains, José Monllor, a graduate student, says he now rides to class instead of driving his car. "It stays in the parking lot," he said of his car. "It's stupid to drive."
The actual impact of bike-sharing on traffic or emissions is difficult to quantify because converts include people like Monllor, who would have driven, as well as those who would have taken public transportation.
Officials in Lyon, the first city to institute a massive technology-driven bike program, estimate that bike-sharing has cut carbon dioxide emissions by up to 8,000 tons since its inception in 2005. But more than that, they say, it has changed the face of the city.
"The critical mass of bikes on the road has pacified traffic," said Gilles Vesco, deputy mayor in charge of Lyon's program. "Now, the street belongs to everybody, and needs to be better shared. It has become a more convivial public space."


New calls for U.S. Treasury to help carmakers
Sunday, November 9, 2008
By John Crawley
There were fresh calls on Sunday for the Bush administration to help stalled U.S. automakers, but Democratic and Republican officials said taxpayers cannot repeatedly support business rescues.
Republican Sen. Mel Martinez of Florida delivered important backing for those urging the Bush administration to use a recently launched $700 billion (444.6 billion pound) corporate bailout program to rescue General Motors Corp, Ford Motor Co and Chrysler LLC with desperately needed cash.
"Within the authority of that package, I think it's possible for the secretary of the treasury to direct a loan to that -- to those entities," Martinez said.
Martinez is a member of the Banking Committee, which oversees administration of the financing program.
The Bush administration, which recently rebuffed a request for capital from GM to help facilitate a possible merger with Chrysler, has not decided whether it will -- or can, by law -- expand the bailout initiative beyond banks and other financial services firms.
GM, Ford and Chrysler are burning through cash at a rapid rate and are seeking at least $25 billion in immediate federal loans to help them survive.
Manufacturers blame their problems on the credit meltdown, which has restricted corporate and consumer borrowing. Most consumers finance auto sales, which are plunging industrywide.
Detroit and supporters in Congress essentially argue GM, Ford and Chrysler are too big to fail. They employ 250,000 people in the United States and support more than 4 million additional jobs in other areas of the economy.
Martinez did not advocate an aid amount but said taxpayers cannot be asked multiple times for bailouts, especially of companies that have already received significant government assistance already -- like the Detroit manufacturers.
"There's a limit to what government can do for a failing industry. There's got to be some things they do to restore the confidence of the people that might invest in their companies," Martinez said.
Congress in September approved $25 billion in low-interest loans for Detroit to help it develop more fuel-efficient cars. Although automakers sought the financing, they now do not believe the money -- with conditions on its use -- can be unlocked fast enough or help them survive.
Support by Martinez for action by the Bush administration followed a request by House and Senate Democratic leaders on Saturday for Treasury Secretary Henry Paulson to consider using his bailout powers for Detroit.
Expanding the rescue is a politically tricky question in the waning days of the Bush administration since it might prompt a flood of requests from other troubled manufacturers.
John Podesta, transition co-chair for President-elect Barack Obama, said on CNN's "Late Edition" that short-term assistance is warranted for auto companies but "you can't expect taxpayers to keep coming back and back and back."
Podesta urged the administration to use its authority to try to "quite literally put a tourniquet on the bleeding" and stabilise the auto industry. He also said the Obama camp is exploring possible legislative remedies.
The third-ranking Democrat in the U.S. House of Representatives, James Clyburn of South Carolina, believes Paulson has the authority to act and should move quickly to help GM, Ford and Chrysler.
"They are about to drift out to the edge, and I think we need to bring them back in," Clyburn said.

New York City Opera loses bold French director
By Daniel J. Wakin
Sunday, November 9, 2008
NEW YORK: In February 2007, the New York City Opera staked its future on the vision of Gérard Mortier, a European impresario known for provocative productions and a penchant for shaking things up. On Friday, the company and Mortier said they were parting ways.
In the City Opera's bold venture, Mortier was to take on the jobs of general manager and artistic director in the 2009-10 season. It agreed to his plans to scrap old-fashioned traditions, mount challenging 20th-century works, bring opera to the people in their neighborhoods and extensively renovate the company's home, the New York State Theater, rather than try to find a new building.
Now the company, already troubled by a recent string of bad news like layoffs and furloughs, said it would abandon his programming for next season, though the renovation would continue. And the temporarily homeless company's truncated program for this season, consisting mainly of two performances of a concert version of Barber's "Antony and Cleopatra" at Carnegie Hall and a handful of orchestra concerts focusing on the composers Mortier had programmed for next year, will go forward.
But the company said it had no clear plan beyond that. The board was scrambling to find a replacement for Mortier and devise a program.
Mortier's departure, ending months of rumors and speculation, also deflates the prospect of a Lincoln Center cross-plaza rivalry with the Metropolitan Opera, which under its general manager, Peter Gelb, has already embarked on an adventuresome course.
Susan Baker, the City Opera's chairwoman, who began wooing Mortier after being seated next to him at a dinner at the French consulate, said she and the board were "enormously discouraged and disappointed" but harbored no ill feelings about Mortier's departure at such a crucial and delicate moment in the company's history.
She said she did not feel let down and continued to admire Mortier. "If you're looking for me to go scorched earth on you, I'm just not going to do it," she said.
Speaking from his apartment in Ghent, Belgium, Mortier said he decided to resign when it became clear that the board would not give him the money needed to produce a meaningful slate of opera productions.
He said that from the start he had been promised a budget of $60 million, a number even mentioned in his contract. But the board was prepared to approve only $36 million, he said, not much more than the basic fixed costs of running the company, leaving him little room for innovative productions.
"I told them with the best will I can't do that," Mortier said.
"I cannot go to run a company that has less than the smallest company in France." Mortier is in the final year of running the Paris National Opera, which has a budget closer to $300 million. "You don't need me for that," he said.
Previous City Opera budgets had been around $42 million, not including overspending that had created $15 million in deficits.
Baker blamed the skin-and-bones budget on the economic crisis that has taken a toll on arts organizations around the United States, especially with respect to donations.
"The irony of all this, I really believe and many others do as well, is if we could simply have gotten the first season on the boards, it really would have galvanized fund-raising," Baker said.
Mortier agreed. But he said he had suggested running a deficit on purpose and borrowing money to put on a first season and show potential new donors what City Opera could do. But the board "got in a panic" over the financial crisis and refused, he said. Meanwhile, he added, the board had not raised much new money and lacked heavy hitters who would give tens of millions of dollars at a clip.
"The only new money came from me," he said, referring to about $6 million in promises from foundations.
The New York Times

At Afghan outpost, a lonely war drags on
By C.J. Chivers
Sunday, November 9, 2008
COMBAT OUTPOST LOWELL, Afghanistan: The small stone castle, sandbagged and bristling with weapons and U.S. soldiers, rises from a rock spur beside the Landay River. Mountains lean overhead.
Once a hunting lodge for Muhammad Zahir Shah, Afghanistan's last king, the castle is home for a year for a U.S. cavalry troop, an Afghan infantry company, a U.S. Navy corpsman and two U.S. marines.
In the deadly contest for Afghanistan's borderlands, it plays what might seem a singularly unattractive role. The position lies exposed near the bottom of a natural amphitheater deep within territory that is beyond government control.
Insurgents hide in caves surrounding it and in villages nearby, operating unhindered almost to the castle's concertina wire and lobbing mortars toward it at will. The steep slopes facing the walls are littered with shattered boulders and trees blown to splinters by the artillery and airstrikes with which the soldiers have fought back.
The U.S. mission here is to disrupt the Taliban and foreign fighters on supply paths from Pakistani tribal areas. Colonel John Spiszer, the commanding officer for the larger task force in the region, distilled how the mission often works. The U.S. presence, he said, is a Taliban magnet, drawing insurgents away from more populated areas and creating security elsewhere.
First Lieutenant Daniel Wright, the executive officer of the U.S. cavalry unit - Apache Troop of the 6th Battalion, 4th Cavalry - put things in foxhole terms.
"Basically," he said, "we're the bullet sponge."
It is a measure of the profound and enduring difficulties in this war, which this year became more deadly for Americans than the Iraq conflict. In roughly four months, the troop has taken fire on at least 70 days. The attacks have come by rocket, mortar, machine gun and rifle fire. The troop's patrols have been ambushed. Its observation posts have been hit by rocket fire.
On one day alone, the outpost was attacked four times.
The fighting is so frequent, and the terrain so rugged and populated by insurgent spotters, that the outpost's patrols dare not venture far.
On Saturday, insurgents fired on Apache Troop for an hour in the morning with a mix of mortar, rocket and large-caliber sniper fire. The soldiers fought back until they thought the attack had ended. Then the Taliban opened fire again.
Fighting broke out again at 1 p.m. During the exchange, a mortar round landed at the base of the castle's southern wall and exploded with a thunderous crack, shaking the compound. About 15 long seconds later, a radio operator called to the other bunkers over the two-way radios. "Everyone's O.K.," he said.
Shortly before 5 p.m., the insurgents struck again, opening fire with rocket and automatic rifle fire on engineers who were moving equipment near an observation post. After a firefight that lasted about five minutes, they slipped away in the fading light.
The Afghan war has entered its eighth year, and there is an unvarnished consensus among soldiers here, many of them veterans of the war in Iraq, that the Pentagon's efforts in Iraq undermined its efforts in Afghanistan, where Al Qaeda plotted attacks on the United States.
President-elect Barack Obama has pledged to refocus the Pentagon on winning this war, and the military has been reviewing its Afghan strategy.
Already before Election Day, more soldiers had been ordered to Afghanistan to rejoin the fight. They are due to arrive soon. (The U.S. Army forbids disclosing deployment dates or troop numbers at outposts.)
For now, the soldiers of Apache Troop absorb and repel attack after attack. Sergeant Michael Ayres, a squad leader, summarized the practical mindset: standing watch behind heavy machine guns, the soldiers, he said, are waiting for reinforcements so they can change the nature of their fight.
"We need all the help we can get out here, so we can push out patrols and get out of the defensive," he said.
Many also find they are managing their frustration at taking harassment fire from the heights overhead and ambushes from opposite ridges, but because of the severity of the terrain, and the insurgents' quickness, of not being able to fight at close range.
"I'm just so tired of seeing muzzle flashes at 800 yards," said Gunnery Sergeant Daniel McKernan, who trains and advises the Afghan Army here. "This is like Vietnam. Hike around these mountains and you never see them. But they are always out there. And they always attack you."
While the soldiers wait, their days are filled by the routines of life in a hostile land. Soldiers stand guard around the clock. Each soldier is allowed to sleep in brief shifts, in crowded bunkrooms shared with bed bugs, flies and mice, while others man the guns.
By day the soldiers burn garbage and the stinking waste accumulated in latrine barrels. In the summer, many of their mattresses were so infested with parasites that they burned them, too. At night the soldiers douse the smoldering pile so its red glow does not guide the Taliban's aim.
The soldiers lift weights when they can, though incoming mortar shells have had an uncanny attraction for the weight room and the plywood hut that serves as the latrine.
Some soldiers indulge in exercise or latrine visits only in darkness, when attacks are less common.
"Did you get the word?" a sergeant asked a reporter last month as they took cover and a mortar round exploded about 30 meters, or 100 feet, away, beside the latrine. "Stay out of there by day."
Showers are an occasional luxury, when water is available. The tank above the shower heads is fed by a pipe carrying spring water from the mountains. The Taliban often disconnects the pipe near its source. Sometimes livestock step on it and break it, too.
There is no Internet except at the troop's command center, and no television. Limited electricity means the soldiers have far fewer comforts than veterans recall from other tours.
"We don't have the same amenities they had in previous deployments, say to Iraq," said Sergeant First Class Shawn Tiarks, platoon sergeant for the troop's second platoon. "A lot of soldiers thought it was going to be identical to that, and it was a little shocking to find the environment we have."
Resupply and troop rotation can come solely by helicopters, because the twisting dirt road to the castle has been made impassible for military vehicles by the destruction of two bridges - one that collapsed and another that was blown up by the Taliban. Barring an emergency, helicopters risk flying here only at night.
The limits on travel have meant shortages.
Several areas of the outpost remain dangerous because the troop lacks the supplies to harden the castle more fully. "We don't get enough sandbags, and at the present moment we are plum out," Tiarks said.
Spizser, in an e-mail message, said that despite the difficulties, keeping the Taliban focused on the outpost has advantages, because the task force can mass firepower and fight with less risk to civilians than in other places.
"Due to the remoteness of the area we are better able to use our advantages in fires - mortars, artillery, attack helicopters and close air support - to fight and usually defeat the enemy pretty decisively," he wrote.
The outpost, he suggested, was both a foothold in the region and a statement. Withdrawing from it, he said, would allow the Taliban to claim it had driven the United States back, as they did when the task force closed another remote outpost earlier this year.
On Thursday, residents of Kamu, the nearby village, had warned the outpost that insurgents were planning a larger assault. Twenty enemy fighters had been seen congregating in one village, one man said, and 40 in another.
The insurgents had at least six mortar tubes, he said, and were being helped by the Pakistani intelligence service, which is a common and unverifiable claim here. Their mortars were being moved into place by donkey, he added. (The man's name was withheld to protect him from reprisals.)
The soldiers discussed the information. Six mortar tubes would be enough to pound the outpost, they said.
On several recent days, a single Taliban mortar tube, firing multiple rounds, had driven the soldiers to cover and had to be countered with mortars, artillery or low-flying fighter planes before going silent. The firing would resume the next day.
During one attack, soldiers took shelter in the castle, waiting to see where each incoming round would strike. "How's a guy supposed to quit smoking?" said Staff Sergeant Josiah Coderellis, a scout, between explosions.
As intense as the fighting has been, the troop - and when this subject is raised they almost invariably tap on anything made of wood - has suffered only one serious injury since arriving: Private First Class Evan Oshel, who was struck by shrapnel in August. He is recovering in Fort Hood, Texas.
"It's hard to believe there's only one," said Captain Frank Hooker, the troop commander, shaking his head.
In October, the attacks became more dangerous. On one day, a rocket-propelled grenade severed the right arm and part of the right foot of a local teenager working in the laundry. Several days later, a mortar round killed an Afghan guard and wounded an Afghan cook, who was still in critical condition last week.
There were also close calls. One mortar round exploded by the open-air weight room, nearly killing a marine captain and a photographer for The New York Times who crouched together against a stone wall about a couple of meters away. The wall absorbed the shrapnel. The captain suffered a concussion.
Another round struck directly in front of a machine-gun bunker, where soldiers huddled as it screamed down and exploded. Private First Class William Solorzano described the unforgettable sound. "It's a bad noise," he said.
Then he reconsidered. "Actually, it's a beautiful noise, if you get to hear it," he said. "Because if you don't hear it, that's because you're dead."
In an effort to keep the Taliban off-balance, the troop and the Afghan Army conduct occasional patrols, varying the routine so insurgents will not anticipate them.
On one evening, a squad of Afghan soldiers and three U.S. advisers slipped out just before dusk. They picked their way up a rocky trail, wondering whether they had been seen.
The answer came quickly. A rocket-propelled grenade hissed through the air from an opposite ridge, passed the patrol and flew by the castle. It exploded in the riverbed with an ear-splitting crack.
A brief firefight ensued. Along the castle's walls, the soldiers peered through their rifle scopes. A few shouted insults.
The troop's 120-millimeter mortar crew began shelling the Taliban firing position - a cave entrance on a ridge about 1,000 meters away.
First they fired explosive rounds, then white phosphorous, which set the vegetation by the cave on fire, marking it for an F-15 fighter jet that dropped a 500-pound guided bomb.
The detonation shook the valley. Quiet settled on the outpost. On the castle's roof, voices floated in the darkness and soldiers' faces were briefly illuminated when they inhaled cigarettes. They wondered whether the insurgent had been killed.
"I don't know if he's dead," Coderellis said. "But he ain't happy."
"I think he's dead," Tiarks said.
"At least his ears are ringing," a third soldier said.
"They aren't ringing," Coderellis said. "They're bleeding."
Like any other feeling, bravado here comes and goes. At other moments, servicemen were contemplative. They were waiting, they said, for many things.
They were waiting for the Afghan Army to become competent, so it can secure the country with less U.S. help. That, the soldiers said, will take years.
They were waiting for a new strategy and for more U.S. units to arrive, to allow soldiers in forward outposts to perform more ambitious operations. That will take at least several weeks, and probably longer.
Some were waiting for leave, and a chance to see home.
In the meantime, as the Taliban set the pace, the soldiers waited to see what each hour would bring.
Late one night, Petty Officer Third Class Ramon Gavan arranged his rifle, helmet and flak jacket beside his bed, putting it all at arm's reach.
"Living the dream," he said, repeating a one-liner often heard here.
"This is where you realize not to take every breath for granted," he said, and swung his legs onto his bed, pulled a poncho liner across his face and fell asleep. The next day, he was back on patrol.

Spanish troops killed in Afghan attack
Published: November 9, 2008
KABUL: Two Spanish soldiers were killed and four wounded in a suicide bombing in western Afghanistan, Afghan officials said Sunday.
An Afghan civilian was wounded as well, struck by the blast as his motorcycle was passing close by, the officials said.
The Taliban claimed responsibility for the explosion in a telephone call. The Taliban spokesman, Qari Yousuf Ahmadi, said the suicide attack was made on military convoy as it passed near the village of Azizabad, in Shindand district.
Ahmadi said the attack was in retaliation for a raid on the village by U.S. Special Operations forces in August that left 90 civilians dead, according to United Nations and Afghan government investigations. A U.S. military investigation put the number of civilian dead at 33


Auditors go easy on military contractors
The Associated Press
Sunday, November 9, 2008
WASHINGTON: Instead of seeing red, Pentagon audit managers saw business as usual after being told that a major military contractor failed to open all its books for review.
At a meeting of Defense Contract Audit Agency staff in California last May, auditor Acacia Rodriguez used a 24-page PowerPoint briefing to describe how she and her co-workers struggled with the Bechtel Group's "chronic failure" to provide the financial records required to prove tax dollars were being spent properly.
"Mtn View, we have a problem!!!" said one of Rodriguez's briefing charts, a shorthand reference to the audit agency's branch office in Mountain View, outside San Francisco.
If her bosses were upset over the contractor's foot-dragging, they didn't show it, according to an auditor who attended the meeting, which included Christopher Andrezze, director of the agency's Western region.
Five days later, the agency issued a report rating Bechtel's internal accounting procedures as "adequate," a passing grade that meant defense auditors could ease up on the company. The report made no mention of the records delays.
DCAA is the first line of defense for the public in policing billions of dollars in defense contracts awarded by the government's top-spending department. In theory, the audit agency has extensive powers, including withholding payments and issuing subpoenas, to force contractors to provide the necessary information.
The reality is quite different.
The Bechtel episode illustrates how tolerant the agency can be when defense contractors slow the government's access to paper records and databases. There is no way to know how often DCAA withholds payments because it does not keep track. And it has not used its subpoena power in 20 years.
"We have been basically on the trust system for years," said the auditor who attended the May meeting. "It did not work on Wall Street and it is not working for federal contracts," said the two-decade veteran of the agency who spoke on condition of anonymity because DCAA employees are not allowed to publicly discuss their work.
Negotiation, not confrontation, is the usual method for prying hard-to-get data loose from companies that make weapons or support troops in Iraq and Afghanistan. But the numbers show that approach is too cozy when the need for tough oversight is greater than ever.
In 2007 alone, DCAA performed nearly 34,000 audits covering $391 billion in contractor costs. Of that total, auditors challenged $4.6 billion, or 1.2 percent, as lacking necessary documentation. The question is, how much more could they have caught?
"I start salivating thinking about how much money is involved and the savings that are potentially there," Sen. Claire McCaskill, D-Mo., said at a congressional hearing in September.
Compared with other federal oversight organizations, such as the Government Accountability Office, DCAA's return on investment is weak. For every dollar GAO spends, it saves taxpayers $94. At DCAA, the ratio is $5 saved for every one spent.
DCAA officials declined to be interviewed for this story. In an e-mailed response to questions, Pentagon spokesman Darryn James said contractor delays and refusals to provide records are not extensive problems.
He acknowledged there are times when contractors have to be reminded to provide information. Records disputes are handled at the lowest possible level by the nearly 3,500 defense auditors in the U.S. and overseas, James said. Officials at the agency's headquarters at Fort Belvoir, Va., have had to step in just four times since 2003, he said. All four disagreements were settled without going to court.
"It should be considered a success that DCAA has been able to get the information it needs without having to resort to subpoena authority," James said.
James described the Bechtel situation as an unusual case that was resolved after the agency and the company worked out a way to answer auditor requests for records more promptly.
But an e-mail exchange between DCAA employees in early 2006 indicates the problems with Bechtel were long-standing. "This is the slowest responding (contractor) that I've been at," reads the message from early 2006, provided to The Associated Press on the condition that the employees not be named. "You would be unnerved to know that some of my data request (sic) here have been outstanding for more than six months!!!"
Based in San Francisco, Bechtel is an engineering and construction company that has won just under $10 billion in Defense Department work since 2000, according to, a Web site created by the public-interest group OMB Watch to track government contracts.
Bechtel spokesman Francis Canavan said the company has a "long record" of working with DCAA. He said there have been occasional delays in locating older records. "We're not aware of any findings that these delays adversely impacted the audits," Canavan said.
Bechtel is not the only trouble spot, according to internal agency documents.
_In September, two auditors traded e-mail complaints about Raytheon, one of the largest U.S. manufacturers of military weapons. "It is not possible to do quality audits under such an environment," one message said. "It is an endless battle," a second said. Raytheon did not respond to a request for comment from the AP.
_Northrop Grumman, which did more than $20 billion in business with the Pentagon in 2007, has refused to give DCAA access to minutes from meetings of the audit committee that reports to the company's board of directors, according to an internal DCAA memo dated Oct. 29. Randy Belote, a Northrop Grumman spokesman, declined comment, saying the issue "is part of an ongoing legal review within the company."
DCAA, formed in 1965, has long been viewed as a bulwark against waste and fraud. Its reputation took a hit this summer after an investigation by the GAO found that supervisors improperly influenced audits to favor contractors. Auditors also were pressured to close audits early in order to meet productivity goals, the GAO report said.
The report mentioned records access problems only in passing. Boeing, a defense giant, did not give auditors the necessary detail to trace costs on a $1 billion space-launch contract, it said. Boeing spokesman Joe Tedino said the company did nothing improper.
"In the end, contractors are getting away with murder" because they know auditors are pushed to complete audits quickly, Diem Thi Le, a senior auditor at DCAA, said at a Sept. 10 congressional hearing on the GAO report. In November 2005, Le reported allegations of misconduct by managers. Her complaints led to the GAO inquiry.
DCAA Director April Stephenson told lawmakers the agency is taking the report seriously and addressing the shortcomings.
The fault isn't all DCAA's, procurement experts say. The agency doesn't always press contractors hard because its actions may not be backed up at the top levels of the Defense Department.
That's especially true for high-profile contracts supporting operations in Iraq and Afghanistan. In one example, department officials overruled auditors who objected to nearly $1 billion in payments to KBR, the Houston-based contractor that supplies U.S. troops with food and housing.
"DCAA finds few friends," said Richard C. Loeb, an adjunct professor of government contract law at the University of Baltimore Law School. "Their work is not appreciated the way it should be."
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First big test for Pakistan economic official
By Sahar AhmedReuters
Sunday, November 9, 2008
KARACHI: Shaukat Tarin, the top economic official in Pakistan, is known as a hardheaded straight talker who loves a challenge.
The veteran banker might just be up against his biggest test - steering Pakistan out of its most severe economic troubles in years.
A balance of payments crisis has left the central bank with foreign reserves of $3.53 billion, less than the import bill of $3.81 billion in September, and there is concern that without help, the country could default on a bond that is maturing early next year.
Analysts say it is almost inevitable that the government will agree to a program with the International Monetary Fund.
Tarin was appointed the prime minister's top adviser on economic affairs last month. He joined Citibank as a trainee in 1975, after graduating with a master's degree in business from Punjab University, Pakistan's oldest university, where he majored in finance.
He rose to take charge of several banks and also served as chairman of the Karachi Stock Exchange before joining the government as the de facto finance minister. He cannot be appointed a cabinet minister because he is not a member of Parliament.
Although Tarin has shunned politics, Muneer Kamal, a colleague at Citibank, said he was not surprised to see his old friend join the government.
"Most people would run away from the sheer weight of responsibility, but Shaukat's not that type," Kamal said. "If he feels it's a challenging job and he can do something positive, he won't be shy."
Tarin once said in an interview with The New York Times that he was most proud of building up the business at Citibank, where he also worked in the Gulf and Thailand. "Citibank was where I learned all about banking and my experiences there laid the foundations for my career," he said.
At the request of the government, he took over as chairman and president of the largest bank in Pakistan, Habib Bank, in 1997, turning it around from a $230 million loss in 1996 to a profit of $30 million in 1998.
He had similar success at Union Bank, which he took over in 2000, making it one of the top banks in the country in five years and preparing for its sale to Standard Chartered Bank.
Old colleagues speak of a no-nonsense style and attention to detail.
"He's a very aggressive person and he means what he says," said one banker who worked under Tarin at Saudi Pak Commercial Bank but declined to be identified because he was not authorized to speak on the issue.
Another old friend and colleague, who also declined to be identified because he was not authorized to speak on the issue, said Tarin's political bosses would be wise to leave him alone to get on with the job.
"He has the ability and the capability to deliver provided he's given a free hand," said the former colleague.



Thomas L. Friedman: Show me the money
Sunday, November 9, 2008
So, I was speaking to an Iranian friend about what a mind-bending thing it must be for people in the Middle East to see Americans, seven years after 9/11, electing someone named Barack Hussein Obama as president. America is surely the only nation that could - in the same decade - go to war against a president named Hussein (Saddam of Iraq), threaten to use force against a country whose most revered religious martyr is named Hussein (Iran) and then elect its own president who's middle-named Hussein.
Is this a great country or what?
Much has been written about how people all around the world are celebrating the victory of our Hussein - Barack of Illinois, whose first name means "blessing" in Arabic. It is, indeed, a blessing that so many people in so many places see something of themselves reflected in Obama, whether in the color of his skin, the religion of his grandfather, his African heritage, his being raised by a single mother or his childhood of poverty. And that ensures that Obama will probably have a longer than usual honeymoon with the world.
But I wouldn't exaggerate it. The minute Obama has to exercise U.S. military power somewhere in the world, you can be sure that he will get blowback. For now, though, his biography, demeanor and willingness to at least test a regime like Iran's with diplomacy makes him more difficult to demonize than George W. Bush.
"If you're a hard-liner in Tehran, a U.S. president who wants to talk to you presents more of a quandary than a U.S. president who wants to confront you," remarked Karim Sadjadpour, an Iran expert at the Carnegie Endowment. "How are you going to implore crowds to chant 'Death to Barack Hussein Obama'? That sounds more like the chant of the oppressor, not the victim. Obama just doesn't fit the radical Islamist narrative of a racist, blood-thirsty America, which is bent on oppressing Muslims worldwide. There's a cognitive dissonance. It's like Hollywood casting Sidney Poitier to play Charles Manson. It just doesn't fit."
But while the world appears poised to give Obama a generous honeymoon, there lurks a much more important question: How long of a honeymoon will Obama give the world?
To all those Europeans, Canadians, Japanese, Russians, Iranians, Chinese, Indians, Africans and Latin Americans who are e-mailing their American friends about their joy at having "America back," now that Obama is in, I just have one thing to say: "Show me the money!"
Don't just show me the love. Don't just give me the smiles. Your love is fickle and, as I said, it will last about as long as the first Obama airstrike against an Al Qaeda position in Pakistan. No, no, no, show me the money. Show me that you are ready to be Obama stakeholders, not free-riders - stakeholders in what will be expensive and difficult initiatives by the Obama administration to keep the world stable and free at a time when we have fewer resources.
Examples: I understand any foreigner who objected to the U.S. invasion of Iraq. But surely everyone in the world has an interest in helping Obama, who opposed the war, bring it to a decent and stable end, especially now that there is a chance that Iraq could emerge as the first democracy, albeit messy, in the heart of the Arab-Muslim world. Obama was against how this Iraq war started, but he is going to be held responsible for how it ends, so why don't all our allies now offer whatever they can - money, police, aid workers, troops, diplomatic support - to increase the odds of a decent end in Iraq? Ditto Afghanistan.
The UN says it doesn't want Iran to go nuclear and doesn't want the U.S. to use force to prevent Iran from going nuclear. I agree.
That's why I want all those people in China, France, Russia, India and Germany who are smiling for Obama to go out and demand that their governments use their tremendous economic leverage with Iran to let the Iranians know that if Tehran continues to move toward a nuclear weapon, in opposition to UN resolutions, these countries will impose real economic sanctions. Nothing would more help Obama to forge a diplomatic deal with Iran than having a threat of biting Chinese, Indian and EU economic sanctions in his holster.
Bush, because he was so easily demonized, made being a free-rider on American power easy for everyone - and Americans paid the price. Obama will not make it so easy.
So to everyone overseas I say: Thanks for your applause for our new president. I'm glad you all feel that America "is back." If you want Obama to succeed, though, don't just show us the love, show us the money. Show us the troops. Show us the diplomatic effort. Show us the economic partnership. Show us something more than a fresh smile.
Because freedom is not free and your excuse for doing less than you could is leaving town in January.



Old think on a new day
Sunday, November 9, 2008
It didn't take long for Russia to lay down a Cold War-tinged challenge for President-elect Barack Obama. One day after the election, the Russian president, Dmitri Medvedev, declared that he would put short-range missiles on Russia's border near Poland if the next American leader follows through on President Bush's plans to build a missile defense system in Europe.
The dark flashbacks didn't end there. In his state of the nation speech, Medvedev also spoke about extending the presidential term from four years to six.
That fueled immediate speculation that he was paving the way for Vladimir Putin, the two-term former president who is now prime minister, to return to power.
Obama offers the promise of a more inclusive U.S. foreign policy, one freed from President Bush's us-versus-them mind-set. Sadly, Medvedev and Putin seem more interested in drawing lines in the sand than in exploring Obama's intentions.
Russia's leaders know full well that the U.S. missile defenses pose no real threat to their huge nuclear arsenal. But playing the victim is an easy way to divert attention from Russia's shrinking democracy, and now from declining oil prices.
As for Bush's fixation with missile defense, the president-elect has said that he would deploy a system to protect the U.S. and its allies but only when it is found to work and be cost-effective - goals that could be far in the future.
Bush spent years looking the other way while Putin harassed opponents, stifled a free press and bullied his neighbors. (A new report that suggests that Georgia had no reason to send troops into a breakaway enclave is disturbing, but not surprising, and still doesn't justify Moscow's invasion.)
While he was busy looking into Putin's eyes, Bush also ignored Russia's list of grievances - many of them illegitimate, but not all.
Medvedev and Putin now seem determined to push their way to the top of Obama's very crowded agenda. We suspect that they will get a more receptive hearing if they stop trying to bully their own people - and everyone else.

Accident on nuclear sub kills 20 off Russia
The Associated Press
Sunday, November 9, 2008
MOSCOW: An accident aboard a Russian nuclear-powered submarine making a test run in the Sea of Japan killed at least 20 people, officials said Sunday.
The nuclear reactor aboard the submarine was operating normally and radiation levels were normal after the accident Saturday, a spokesman for the Russian Navy said.
The accident occurred when a fire-extinguishing system went into operation by mistake, the spokesman, Captain Igor Dygalo, and other officials said. The system is designed to release Freon coolant when activated, the ITAR-Tass news agency reported, which cited an official with Russia's top investigative agency. It was unclear what activated the fire-extinguishing system.
The official, Sergei Markin, said 14 civilians and six sailors were killed and 22 people were hospitalized after being evacuated to a destroyer that brought them to the Pacific port of Vladivostok, ITAR-Tass reported.
Dygalo had said earlier that more than 20 people were killed, including sailors and workers from the shipyard that built the submarine, and that 21 were injured and hospitalized. He said there were 208 people aboard, including 81 servicemen. Officials did not reveal the name of the submarine.
It was Russia's worst naval accident since torpedo explosions sank another nuclear-powered submarine, the Kursk, in the Barents Sea in 2000, killing all 118 seamen aboard. In 2003, 11 people died when a submarine that was being taken out of service sank in the Barents.
The accident Saturday came as the Kremlin is flexing its military muscle and trying to restore Russia's naval reach, part of a drive to show off the nation's clout amid strained ties with the West. A naval squadron is headed to Venezuela for joint exercises this month in a show of force near U.S. waters.
Dygalo said the casualties resulted from the "unsanctioned activation" of the firefighting system in the two sections of the submarine closest to the bow, and that the nuclear reactor that powers it was not threatened.
Dygalo said the sub was not damaged and had returned to its base.
Markin said the authorities had opened an investigation into the accident.
The state-run RIA-Novosti news agency cited an unnamed official at the Amur Shipbuilding Factory as saying the sub was built there and is called the Nerpa. Testing on the submarine began last month, and it submerged for the first time last week, according to the agency.
Construction of the Nerpa, an Akula II class attack submarine, started in 1991 but was suspended for years because of a shortage of financing, RIA-Novosti reported.
Despite a major boost in military spending during Vladimir Putin's eight years as president, the military is still hampered by decrepit infrastructure, aging weapons, and corruption and incompetence.
The first deputy defense minister, Alexander Kolmakov, and the head of the navy, Admiral Vladimir Vysotsky, were on their way to the sub's home port, Dygalo said.
The Kremlin said President Dmitri Medvedev had been informed of the accident immediately and was receiving frequent updates, Russian news agencies reported.
Putin, now the prime minister, was criticized for his slow response to the Kursk disaster.

Obama's victory helps bury a painful past
By Albert R. HuntBloomberg News
Sunday, November 9, 2008
U.S. politics will never be the same. The election of an African-American president doesn't erase the stain of race; it closes old chapters, however, and opens a new one.
My 21-year-old son, a college student born years after the civil rights movement, grasped the scale of the moment. "This is so important for young black kids who've been isolated," Benjamin said. "It's really important for young white kids, too."
Politicians and the press are focusing on the daunting challenges ahead, including the formation of a new government, and Republicans are engaging in the usual recriminations about who lost the election.
Yet the most important story is the monumental election of a president whose father was a black man from Kenya and mother a white woman from Kansas.
Of all the victories in the presidential campaign, none were sweeter to Obama's camp than Virginia and North Carolina, pillars of the old Southern confederacy.
This was the first time Virginia voted for a Democrat for president since Lyndon B. Johnson in 1964. While Johnson was winning approval for landmark civil rights legislation, enforcing for blacks the basic right to vote and allowing them to eat in restaurants and buy homes in good neighborhoods, he lamented that those gains would cost the Democrats his native South for generations.
He was right. When Johnson's White House counsel, Harry McPherson, voted in the Maryland presidential primary in February, a black ballot clerk said to him, "President Johnson would be proud today." He would have been especially proud on Nov. 4.
On the eve of the election, I went to Manassas, Virginia, to see Obama's last rally. I remember as a young journalist hearing veteran political reporters talking about John F. Kennedy's famous rally in Waterbury, Connecticut, just before the 1960 election. About 50,000 people in that working-class community turned out late on a cold night to give Kennedy a hero's welcome. The scene was immortalized in Teddy White's "The Making of the President: 1960."
Decades from now, Manassas will be remembered as well.
The event was a stone's throw from the 1861 Battle of Bull Run, the first major fight in the Civil War. More than 80,000 Virginians showed up in a wildly enthusiastic tribute to the young black candidate. Most of them must have gone to vote the next day. Obama carried Manassas with 55 percent of the vote.
We were standing next to a black gentleman, Wendell McAllister, moved by the moment. In 1961, he was a waiter at Kennedy's inaugural.
A week earlier, Obama was in Harrisonburg, Virginia, in the conservative Shenandoah Valley, where Confederate flags are still displayed in some convenience stores. He was the first presidential candidate to campaign there since Stephen Douglas in 1860; Abraham Lincoln wasn't on the ballot in slave-holding Virginia.
The crowd of 10,000 at the James Madison University gymnasium included local folks as well as students. An elderly black lady, with a cane, sat near the back and stared quietly, somberly. As Obama began to speak, tears streamed down her cheeks.
There's no way a white person could experience quite those emotions.
Still, after a long night of reporting on Election Day, I drove home at 3 a.m. and saw hundreds of celebrators a few blocks away, across the street from the White House. I had vivid, surreal flashbacks, the types you see in movies.
One was back in the 1950s as a child spending the summer with my grandmother in Orange, Virginia. On a hot day, we were walking through the town square, and I went to get a drink of water. My grandmother pulled me back. The fountain was marked "colored."
Years later as a political reporter, I'd hear often well-meaning politicians say of black colleagues that, of course, they couldn't run statewide and win over a white electorate. In 1990, Harvey Gantt, the former mayor of Charlotte, North Carolina, came within a whisker of defeating the segregationist Jesse Helms for U.S. Senate. Six years later, Gantt was challenged in the Democratic senatorial primary because party leaders knew a black man couldn't win statewide. They were right.
Last Tuesday, Obama carried North Carolina.
Apart from partisan politics, Virginia, North Carolina and Florida are a different South, more like New Jersey or Connecticut in racial attitudes. Which Southern states will come next? South Carolina, Georgia, Texas?
With Obama's presidency, racism and racial inequities won't disappear. Today, blacks earn less than two-thirds the income of whites; the black jobless rate was 11 percent last month, almost double that of whites, and 7 in 10 black babies are born to a single mother.
Under the best-case scenario, that will improve only on the margins over the next four years.
Nonetheless, the election of a black man facilitates discussions of these issues for people of all races.
During his presidential run, Obama was never the black candidate. Instead, he was the candidate who was black. He was sensitive to the history of race and politics in America; read his Philadelphia speech of last March. Yet he practiced the politics of hope and opportunity, not victimization.
(Although both campaigns had their seamy moments this autumn, the Republican John McCain, to his credit and to the dismay of some in his party, refused to play the race card.)
And the Obama presidency, whether it is successful or not, makes the American experience, and the sense of U.S. exceptionalism, far richer.
We celebrate the founding fathers as the most gifted collection of men ever assembled at one time. They were. They also excluded women and blacks from their declaration that "all men are created equal." The great Thomas Jefferson thought blacks were biologically inferior.
When Johnson carried Virginia 44 years ago, it was against state law for Obama's interracial parents to marry; in parts of the state, Obama wouldn't have been allowed to vote.
He carried Virginia last week by 202,000 votes. That only could have occurred in America.



Roger Cohen: Emptying Pandora's box
Sunday, November 9, 2008
NEW YORK: These are interesting times. Jobs are disappearing and General Motors is running out of cash. At the same time, the United States has assuaged some of its deepest wounds with the election of Barack Obama. We have less money in our pockets but more hope in our hearts.
Hope won't feed an empty stomach. But it's potent. In Greek myth, when Pandora opened her box, she let out all the evils except one: hope. The Greeks considered hope dangerous; its bedfellow can be delusion. Nietzsche later saw hope as the evil that prolongs human torment.
But in the end Pandora opened her box again and released hope because, without it, humanity was filled with despair.
At least that's one version of the myth. What is certain is that there's a lot of hope about these days. It would be an exaggeration to say people are happier now that we have less money, but accurate to say there's a surfacing of shame about the extent of our spend-spend-spend excesses.
The check on this shopping spree stands at $2.6 trillion in U.S. personal debt. That's a staggering sum.
You can't wish away debt with a magic wand. The toll for all those home-equity paid Disney vacations will be heavy. Yet I would resist the temptation to say that economic crisis defines our times. No, as Bill Clinton might have said, "It's the culture, stupid."
The culture that said the most patriotic act was to shop. The culture that sent the best and the brightest to Wall Street to concoct toxic securities. The culture that said there was no need to balance individual rights and community needs. The culture that replaced thrift with thrills and hope with hype. The culture that said a country at war is not a country that needs to pull together in sacrifice.
Goodbye to all that.
I've had countless uplifting e-mails in recent days that, in different ways, have been about a moral reorientation, a reaching out, the rediscovery of the ways in which we can be our brothers' and our sisters' keepers. Diana Strelow, 73, of Portsmouth, Virginia, put it this way: "My vote for Obama was and is about my hope that an intelligent, self-respecting president will lead to a renewal of civility on the part of all of us - perhaps a renewal even of the love that Americans once had for each other."
Significant as economic anxieties were, she said, they paled beside this deeper yearning.
Another message came from a U.S. official who, in January 2007, was serving in Fallujah, Iraq, alongside the 1st and 2nd Marine Expeditionary Forces. He forwarded a letter he had sent to Obama on Jan. 27, 2007, on the eve of the senator's announcement of his candidacy in Springfield, Illinois.
"Those of us still serving in these dangerous Iraqi deserts need your voice and message in the Iraq debate back home," he wrote. "More than that, we want a new politics that speaks again to the great traditions of not just one party but of one country, ours. You capture that theme, genuinely, like no one else.
"Throughout my time in this tough assignment (best and worst job I will ever have), I have looked to Washington for the kind of leadership traits that I see among our Marine captains, colonels and corporals in the mean streets of Anbar. It has been dispiriting. Another Greatest Generation - whose apolitical patriotic steel is being forged here among tens of thousands of Americans - deserves better."
The official, who asked not to be named because of the rules of his government agency, continued: "I am leaving Iraq before long and have decided to go basically straight from Fallujah to Springfield in order to hear your formal announcement in person. I just want to be there. Anonymous. Part of the energy." And he concluded: "With you in the presidential picture, I am more hopeful about endings in Iraq and beginnings at home, in our country we miss so much and remain honored to represent."
Yes, hundreds of thousands of Americans have been engaged in prolonged forms of service and sacrifice that have deserved better.
Better not just of a president, George W. Bush, too insecure to inspire, but of all of us for whom easy credit became synonymous with easy amnesia. Perhaps the new frugality can also be the new humanity.
The United States' moment of reckoning is global. Economic anxiety has spread far and wide, as far and as wide as the hopes vested in Obama. This moment of moral opportunity is not confined to the United States.
Anti-Bushism, straying often into anti-Americanism, has been the defining ideological current of recent times. Its disappearance with Obama, or at least its retreat, leaves a gaping intellectual void needing to be filled.
For inspiration on how to do that I suggest this image: hope fluttering out of Pandora's box. Crisis demands statesmanship, which cannot be composed of calculation alone, but must reach for the unquenchable in the human spirit.
Readers are invited to comment at my blog:


Obama's real mandate is to bridge the wealth gap
By Robert J. Shiller
Sunday, November 9, 2008
The new American president will have a clear mandate to redress economic inequality. During the campaign, John McCain made sure that voters clearly heard Barack Obama say "spread the wealth around," and they elected him anyway.
There has been a significant trend for decades in the United States toward greater inequality that needs to be corrected.
The financial crisis that afflicts the country is largely a result of speculative bubbles, built on false hopes, in the housing and stock markets. Many Americans thought that they would rise in the economic hierarchy from one or another of these investments, and their disappointment is profound. As dreams have been lost, the gap between the wealthiest and those struggling to provide basic items for their families will become more evident and more painful.
The best way to battle gratuitous inequality is to make financial institutions better embody the true principles of risk management. Financial theory is all about incentives for people to work effectively, and diversifying against random shocks by sharing them among many investors. At its essence, finance is really more about helping and sharing than "beating the market."
Traditional mutual funds and retirement saving plans, as well as insurance plans for loss of one's home because of fire or flood, or of one's income because of disability, are actually risk management vehicles that help reduce inequality. The new president's important mission should be to broaden these plans.
It may seem paradoxical to try to lessen inequality by relying on the institutions that are most blamed today, but it is only through these institutions that inequality reduction can really work well in a capitalist economy. Enhanced financial institutions could serve the real purpose that financial theory proposes: serving the people.
This would mean transforming the kind of ad hoc measures used to help economically stressed people in the current crisis into permanent measures that are grounded in solid financial theory and augmented with an understanding of human nature.
In my book, "The Subprime Solution: How Today's Global Financial Crisis Happened and What to Do About It," I outlined three areas of action that would democratize finance - make it work better for the people - and help prevent more crises. We must improve the information infrastructure, encourage broader and more robust risk markets, and develop better retail financial products. Each of these goals would require work by the government and the private sector, and all would generalize and privatize the emergency measures already taken, so they become systematic.
To improve the information infrastructure, we need to subsidize financial advice for the common man. The crisis the United States is in is largely related to investor ignorance. Some emergency measures, like the Hope Now Alliance, have been set up essentially to offer such help, but these will presumably be dismantled after the crisis, and they are not well designed for serving investors' broad needs. We need some permanent subsidies to get the full scope of financial advice out to the people.
Second, we need to broaden financial markets to improve risk management. We need sophisticated systems that will act as insurance plans against unexpected risks. The government could lead the way to a historic development of financial infrastructure.
Third, we need to change retail financial institutions, notably those that grant and service mortgages. Recent government policy has encouraged workouts, or revised payment plans, for defaulting mortgages - again an impromptu, after-the-fact measure. These workouts should have been spelled out in the original of what I have called a "continuous workout mortgage." Then workouts could be systematic, automatic and free market, with costs priced into the original mortgage rate.
A fourth step would be to index the tax system to income inequality. The system would automatically become more progressive if inequality became more acute.
The best thing that President-elect Obama can do is to set up permanent new structures to harness the innovations of finance to improve people's lives on Main Street. Americans will support a president who works hard both to maintain incentives central to our capitalistic economy and to ensure fundamental fairness. If President-elect Obama does both, he will leave a lasting legacy.
Robert Shiller is a professor of economics and finance at Yale and co-founder and chief economist of MacroMarkets.


Restore confidence first
By Tyler Cowen
Sunday, November 9, 2008
High deficits and a declining economy will limit the hand of the new president in many matters of economic policy. Health care changes usually proves more expensive than promised, and voters are in no mood for higher gasoline or energy taxes. Still, President-elect Barack Obama faces the very important task of restoring confidence in the U.S. economy.
He will need to appear calm and purposive, and to articulate to the American people the underlying economic strengths. Even if some of this is wishful thinking, there is a chance that positive attitudes will improve the reality on the ground.
Over the last several months, the Bush administration has mishandled this issue.
Most of all, the "Paulson plan" to bail out the economy was not executed gracefully. The Treasury secretary, Henry Paulson Jr., warned the United States that something terrible would happen if the plan were not passed; that terrified both Wall Street and Main Street.
The early version of the plan would have given the Treasury secretary almost unlimited powers, without checks and balances on his decisions. The market took that extreme proposal as a sign that the situation was truly dire.
After the scare came indecisiveness. Whether or not the Paulson plan was a good idea, no one articulated how it would work or why it was needed. The initial plan was then dumped for a successor plan — laden with congressional pork, by the way — and then this second plan turned out to be less important, after it was passed, than the need for an immediate recapitalization of the banking system.
Along the way it was never clear what Congress favored or why, and the regulators appeared to be stumbling from one crisis to the next, scaring the American public along the way. Political uncertainty hardly caused the crisis, but politics made it much worse.
Even if you believe the dubious proposition that an initial scare was needed to pass legislation, the time has come to patch up confidence. The U.S. government lacked a commanding presence during the early stages of the financial crisis.
Rebuilding confidence might seem a small matter, but it is not. The truth is this: the United States is a wonderful and magnanimous nation when it is a winner, but Americans are not used to losing and Americans are not used to panic.
Often we respond to negative events badly, so we need to be especially careful when we are in a losing or risky position.
Very bad events can cause a panic among the citizenry or its leaders, which translates into subsequent bad decisions. For a classic example of a negative policy dynamic, look at 9/11. The United States lost 3,000 lives and a great deal of wealth and confidence. The government then took actions, most of all the Iraq war, which led to even greater losses.
We are in danger of getting stuck in another negative dynamic, but this time in the realm of economics. We might follow up the financial crisis with some worse responses and policies.
It's not just the future of the United States that is on the line. Despite the commonality of anti-American rhetoric, the United States sets the tone for much of the world.
If the United States is seen as turning the corner and stabilizing its economy, that will be a positive cue for many other countries.
The notion of a downward spiral of ideas and events is not unprecedented. Starting in the early part of the 20th century, the West experienced one awful event after another, including a world war, a flu pandemic and a major depression. The response was a global spread of totalitarian ideas, a loss of confidence in democracy and capitalism and, eventually, another war.
While today's world is far from this point, there is a small chance that we will move in an unstable and worsening direction. Steering away from it should be a priority for the next president.
Rebuilding confidence won't be easy. If our next president seems flip or overconfident, observers will be skeptical above all else. Denying our basic economic problems will erode credibility, but those problems — most of all our debt and a collapsed financial sector — need to be acknowledged in a way that shows a path forward.
We need to avoid overreaction at the same time we need to return to feeling in control.

How Merrill's thundering herd fell
By Gretchen Morgenson
Sunday, November 9, 2008
"We've got the right people in place, as well as good risk management and controls." - E. Stanley O'Neal, 2005
There were high-fives all around Merrill Lynch headquarters in New York City as 2006 drew to a close. The firm's performance was breathtaking; revenue and earnings had soared and its shares were up 40 percent for the year.
And Merrill's decision to invest heavily in the mortgage industry was paying off handsomely. So handsomely, in fact, that on Dec. 30 that year, it essentially doubled down by paying $1.3 billion for First Franklin, a lender specializing in risky mortgages.
The deal would provide Merrill with even more loans for one of its lucrative assembly lines, an operation that bundled and repackaged mortgages so they could be resold to other investors.
It was a moment to savor for E. Stanley O'Neal, Merrill's autocratic leader, and a group of trusted lieutenants who had helped orchestrate the firm's profitable but belated mortgage push. Two indispensable members of O'Neal's clique were Osman Semerci, who, among other things, ran Merrill's bond unit, and Ahmass Fakahany, the company's vice chairman and chief administrative officer.
A native of Turkey who began his career trading stocks in Istanbul, Semerci, 41, oversaw Merrill's mortgage operation. He often played the role of tough guy, former executives say, silencing critics who warned about the risks the firm was taking.
At the same time, Fakahany, 50, an Egyptian-born former Exxon executive who oversaw risk management at Merrill, kept the machinery humming along by loosening internal controls, according to the former executives.
The actions of Semerci and Fakahany ultimately left their company vulnerable to the increasingly risky business of manufacturing and selling mortgage securities, say former executives, who requested anonymity to avoid alienating colleagues at Merrill.
To make matters worse, Merrill sped up its hunt for mortgage riches by embracing and trafficking in complex and lightly regulated contracts tied to mortgages and other debt. And Merrill's often inscrutable financial dance was emblematic of the outsize hazards that Wall Street courted.
While questionable mortgages made to risky borrowers prompted the credit crisis, regulators and investors who continue to pick through the wreckage are finding that exotic products known as derivatives - like those that Merrill used - transformed a financial brush fire into a conflagration.
As subprime lenders began toppling after record waves of homeowners defaulted on their mortgages, Merrill was left with $71 billion of eroding mortgage exotica on its books and billions in losses.
On Sept. 15 this year - less than two years after posting a record-breaking performance for 2006 and following a weekend that saw the collapse of a storied investment bank, Lehman Brothers, and a huge U.S. bailout of the insurance giant American International Group - Merrill was forced into a merger with Bank of America.
It was an ignominious end to America's most famous brokerage house, whose ubiquitous corporate logo was a hard-charging bull.
"The mortgage business at Merrill Lynch was an afterthought - they didn't really have a strategy," said William Dallas, the founder of Ownit Mortgage Solutions, a lending business in which Merrill bought a stake a few years ago. "They had found this huge profit potential, and everybody wanted a piece of it. But they were pigs about it."
Semerci and Fakahany did not return phone calls seeking comment. Bill Halldin, a Merrill Lynch spokesman, said, "We see no useful purpose in responding to unnamed, former Merrill Lynch employees about a risk management process that has not existed for a year."
Typical of those who dealt in Wall Street's dizzying and opaque financial arrangements, Merrill ended up getting burned, former executives say, by inadequately assessing the risks it was taking with newfangled financial products - an error compounded when it held on to the products far too long.
The fire that Merrill was playing with was an arcane instrument known as a synthetic collateralized debt obligation. The product was an amalgam of collateralized debt obligations (the pools of loans that it bundled for investors) and credit-default swaps (which essentially are insurance that bondholders buy to protect themselves against possible defaults).
Synthetic CDO's, in other words, are exemplars of a type of modern financial engineering known as derivatives. Essentially, derivatives are financial instruments that can be used to limit risk; their value is "derived" from underlying assets like mortgages, stocks, bonds or commodities. Stock futures, for example, are a common and relatively simple derivative.
Among the more complex derivatives, however, are the mortgage-related variety. They involve a cornucopia of exotic, jumbo-size contracts ultimately linked to real-world loans and debts. So as the housing market went sour, and borrowers defaulted on their mortgages, these contracts collapsed, too, amplifying the meltdown.
The synthetic CDO grew out of a structure that an elite team of JPMorgan bankers invented in 1997. Their goal was to reduce the risk that Morgan would lose money when it made loans to top-tier corporate borrowers like IBM, General Electric and Procter & Gamble.
Regular CDOs contain hundreds or thousands of actual loans or bonds. Synthetics, on the other hand, replace those physical bonds with a computer-generated group of credit-default swaps. Synthetics could be slapped together faster, and they generated fatter fees than regular CDOs, making them especially attractive to Wall Street.
Michael Farrell is chief executive of Annaly Capital Management, a real estate investment trust that manages mortgage assets. A unit of his company has liquidated billions of dollars in collateralized debt obligations for clients, and he believes that derivatives have magnified the pain of the financial collapse.
"We have auctioned billions in credit-default swap positions in our CDO liquidation business," Farrell said, "and what we have learned is that the carnage we are witnessing now would have been much more contained, to use that overworked word, without credit-default swaps."
The bankers who invented the synthetics for JPMorgan say they kept only the highest-quality and most bulletproof portions of their product in-house, known as the super senior slice. They quickly sold anything riskier to firms that were willing to take on the dangers of ownership in exchange for fatter fees.
"In 1997 and 1998, when we invented super senior risk, we spent a lot of time examining how much is too much to have on our books," said Blythe Masters, who was on the small team that invented the synthetic CDO and is now head of commodities at JPMorgan Chase. "We would warehouse risk for a period of time, but we were always focused on developing a market for whatever we did. The idea was we were financial intermediaries. We weren't in the investment business."
For years, the product that Masters and her colleagues invented remained just a mechanism for offloading risk in high-grade corporate lending. But as often occurs with Wall Street alchemy, a good idea started to be misused - and a product initially devised to insulate against risk soon morphed into a device that actually concentrated dangers.
This shift began in 2002, when low interest rates pushed investors to seek higher returns.
"Investors said, 'I don't want to be in equities anymore and I'm not getting any return in my bond positions,' " said William Winters, co-chief executive of JPMorgan's investment bank and a colleague of Masters on the team that invented the first synthetic. "Two things happened. They took more and more leverage, and they reached for riskier asset classes. Give me yield, give me leverage, give me return."
A few years ago, of course, some of the biggest returns were being harvested in the riskier reaches of the mortgage market. As CDOs and other forms of bundled mortgages were pooled nationwide, banks, investors and rating agencies all claimed that the risk of owning such packages was softened because of the broad diversity of loans in each pool.
In other words, a few lemons couldn't drag down the value of the whole package.
But the risk was beneath the surface. By 2005, with the home lending mania in full swing, the amount of CDOs holding opaque and risky mortgage assets far exceeded CDOs composed of blue-chip corporate loans. And inside even more abstract synthetic CDOs, the risk was harder to parse and much easier to overlook.
Janet Tavakoli, president of Tavakoli Structured Finance, a consulting firm in Chicago, describes synthetic CDOs as a fanciful structure "sort of like a unicorn born out of the imagination."
More important, she said, is that the products allowed dicier assets to be passed off as higher-quality goods, giving banks and investors who traded them a false sense of security.
"A lot of deals were doomed from the start," Tavakoli said.
By 2005, Merrill was in a full-on race to become the biggest mortgage player on Wall Street. A latecomer to the arena, it especially envied Lehman Brothers for the lush mortgage profits that it was already hauling in, former Merrill executives say.
Lehman had also built a mortgage assembly line that Merrill wanted to emulate. Lehman made money every step of the way: by originating mortgage loans, administering the paperwork surrounding them and packaging them into CDOs that could be sold to investors.
Eager to build its own money machine, Merrill went on a buying spree. From January 2005 to January 2007 it made 12 major purchases of residential or commercial mortgage-related companies or assets. It bought commercial properties in South Korea, Germany and Britain, a loan servicing operation in Italy and a mortgage lender in Britain. The biggest acquisition was First Franklin, a domestic subprime lender.
The firm's goal, according to people who met with Merrill executives about possible deals, was to generate in-house mortgages that it could package into CDOs. This allowed Merrill to avoid relying entirely on other companies for mortgages.
That approach seemed to be common sense, but it was never clear how well Merrill's management understood the risks in the mortgage business.
O'Neal declined to comment for this article. But John Kanas, the founder and former chief executive of North Fork Bancorp, recalls the many hours he spent talking with O'Neal, Fakahany and other Merrill executives about a possible merger in 2005.
"We spent a great deal of time with Stan and the entire management team at Merrill trying to learn their business and trying to explain our business to them," Kanas said. "Unfortunately, in the end we were put off by the fact that we couldn't get comfortable with their risk profile and we couldn't get past the fact that we thought there was a distinct possibility that they didn't understand fully their own risk profile."
Kanas, who later sold his bank to the Capital One Financial Corporation, had many meetings with Fakahany, who was responsible for the firm's credit and market risk management as well as its corporate governance and internal controls. Former executives say Fakahany had weakened Merrill's risk management unit by removing longstanding employees who "walked the floor," talking with traders and other workers to figure out what kinds of risks the firm was taking on.
Former Merrill executives say that the people chosen to replace those employees were loyal to O'Neal and his top lieutenants. That made them more concerned about achieving their superiors' profit goals, they say, than about monitoring the firm's risks.
A pivotal figure in the mortgage push was Semerci, a details-oriented manager whom some former employees described as intimidating. He joined Merrill in 1992 as a financial consultant in Geneva.
After that, he became a fixed-income sales representative for the firm's London unit. He later rose quickly through Merrill's ranks, ultimately overseeing a broad division: fixed income, currencies and commodities.
Always carrying a notebook with his operations' daily profit-and-loss statements, Semerci would chastise traders and other moneymakers who told risk management officials exactly what they were doing, a former senior Merrill executive said.
"There was no dissent," said the former executive, who requested anonymity to maintain relationships on Wall Street. "So information never really traveled."
Beyond assembling its own mortgage machine and failing to police risks so it could book fatter profits, Merrill also dove into the CDO market - primarily synthetics.
Unlike the CDO pioneers at JPMorgan who saw themselves as financial designers and intermediaries wary of the dangers of holding on to their products too long, Merrill seemed unafraid to stockpile CDOs to reap more fees.
Although Merrill had a scant presence in the CDO market in 2002, four years later it was the world's biggest underwriter of the products.
The risk in Merrill's business model became viral after AIG stopped insuring the highest-quality portions of the firm's CDOs against default.
For years, Merrill had paid AIG to insure its CDO stakes to limit potential damage from defaults. But at the end of 2005, AIG suddenly said it had had enough, citing concerns about overly aggressive home lending. Merrill couldn't find an adequate replacement to insure itself. Rather than slow down, however, Merrill's CDO factory continued to hum and the firm's unhedged mortgage bets grew, its filings show.
The number of mortgage-related CDOs being produced across Wall Street was staggering, and all of that activity represented a gamble that mortgages underwritten during the most manic lending boom ever would pay off.
In 2005, firms issued $178 billion in mortgage and other asset-backed CDOs, compared with just $4 billion worth of CDOs that used safer, high-grade corporate bonds as collateral. In 2006, issuance of mortgage and asset-backed CDOs totaled $316 billion, versus $40 billion backed by corporate bonds.
Firms underwriting the CDOs generated fees of 0.4 percent to 2.5 percent of the amount sold. So the fees generated on the $316 billion worth of mortgage- and asset-backed CDOs issued in 2006 alone, for example, would have been about $1.3 billion to $8 billion.
Merrill, the biggest player in the CDO game, appeared to be a cash register. After its banner year in 2006, it produced another earnings record in the first quarter of 2007, finally beating three rivals, Lehman, Goldman Sachs and Bear Stearns, in profit growth.
But as 2007 progressed, the mortgage business began to fall apart - and the impact was brutal. As mortgages started to fail, the debt ratings on CDOs were cut; anyone left holding the products was locked in a downward spiral because no one wanted to buy something that was collapsing. Among the biggest victims was Merrill.
In October 2007, the firm shocked investors when it announced a $7.9 billion write-down related to its exposure to mortgage CDOs, resulting in a $2.3 billion loss, the largest in the firm's history. Semerci was forced out, later landing at a London-based hedge fund, the Duet Group.
Merrill's board also ousted O'Neal. On top of the $70 million in compensation he was awarded during his four-year tenure as chief executive, O'Neal departed with an exit package worth $161 million.
John Thain, a former Goldman Sachs executive who was also head of the New York Stock Exchange, was hired as Merrill's chief executive to try to clean up O'Neal's mess. But multibillion-dollar losses kept piling up, and Merrill was hard pressed to raise enough to replenish its coffers.
"None of the trading businesses should be taking risks, either single positions or single trades, that wipe out the entire year's earnings of their own business," Thain said in January. "And they certainly shouldn't take a risk to wipe out the earnings of the entire firm."
A month later, Fakahany left Merrill. Upon his departure, in a statement that Merrill issued, he said: "I leave knowing that the firm's financial condition is significantly enhanced and the new team is in place and moving forward."'
Fakahany continued to receive a Merrill salary until the end of this summer; he does not appear to have received an exit package.
Thain, meanwhile, sold off assets for whatever price he could get to try to salvage the firm. In August, he arranged a sale of $31 billion of Merrill's CDOs to an investment firm for 22 cents on the dollar. For the first nine months of this year, Merrill recorded net losses of $14.7 billion on its CDOs. Through October, some $260 billion of asset-backed CDOs have started to default.
As the depth of Merrill's problems emerged, its shares plummeted. With Lehman on the verge of collapse, Wall Street began to wonder if Merrill would be next.
Some banks were so concerned that they considered stopping trading with Merrill if Lehman went under, according to participants in the Federal Reserve's weekend meetings on Sept. 13 and 14.
The following Monday, Merrill - torn apart by its CDO venture - was taken over by Bank of America.

Young and struggling in the U.S.
By Erik Eckholm
Sunday, November 9, 2008
PHILADELPHIA: Harvey Shaw's plans to move out of his parents' house, finally, have been derailed. With a high school degree obtained belatedly at 21, he had held a full-time job for 26 months as a detailer at a car dealership here, sprucing up new and used cars.
But in early October, Shaw, now 24, recalled, "I came back from vacation, and they said they were cutting back and replacing me with part-time workers."
Labor experts say the hardships of the gathering recession are sweeping down to hurt the working poor and younger job seekers most of all in the United States.
From the fall of 2007 to this October, the share of American 16- to 19-year-olds working fell by 8 percent, the largest decline of any age group, and the outlook for youths and low-skilled workers in coming months is bleak, economists say, with the industries most apt to employ them, like home-building and retail sales, taking steep dives.
On Friday, the Bureau of Labor Statistics reported that 240,000 jobs disappeared in October alone, bringing the U.S. unemployment rate to 6.5 percent. But construction, for example, had the highest unemployment rate of any industry: 10.8 percent, compared with 6.1 percent a year ago, leaving entry-level applicants in the cold.
"Low-income people are the big losers when the economy turns down," said Andrew Sum, director of the Center for Labor Market Studies at Northeastern University, in Massachusetts.
With jobs scarce, many college graduates find themselves taking jobs that do not require a degree, and laid-off middle-income workers are taking lower-paying jobs in areas like retail sales. A kind of domino effect is beginning to squeeze out the least skilled or experienced workers — those already on the bottom of the ladder — who are settling for part-time employment and fewer hours if they can find work at all. Hardest hit of all are younger job-seekers, especially black males in their late teens or early 20s without more than a high school education.
Among those ages 16 to 19, access to part-time jobs, full-time jobs and summer jobs had already declined through this decade, and by last month only 31.4 percent had held some sort of employment. In the year ahead, Sum predicted, "The teens will be thrown out of the labor market at record levels," often causing hardship for poor families and causing youths to miss experience that, studies show, will gain them better jobs in the future.
Like Shaw, Kyuana Everett, 21, earned her high school degree at the YouthBuild charter school here, which helps dropouts complete high school and seeks to prepare them for a trade or higher education.
"I've tried for everything, retail sales, office work, but the employers all say they have too many staff and they're not hiring now," Everett said. "McDonald's was the only place that would take me, but only part-time," for $7.25 an hour.
Everett cannot afford to rent even a room, and stays secretly with her grandmother in a home for the elderly. She hopes to get a scholarship to a technical college for training as an electrician.
The one age group whose employment rate climbed over the last year was people over 65, who are starting to take the part-time and retail jobs once dominated by students and younger high school graduates, Professor Sum said.
A recession takes its largest tolls not only on the young but also in cyclical industries like construction, manufacturing of durable goods, retail trade, hotels and temp agencies — traditional avenues into the workplace for the less skilled.
The crash in construction jobs is most acute in housing, which tends to use a greater share of inexperienced labor than commercial construction does, said Ken Simonson, chief economist for the Associated General Contractors of America. Looking at economic projections, Simonson said, "I'd expect even more of those low-skilled jobs will be lost."
Here in Philadelphia, Michael Stepnowski, who runs a small construction company mainly doing office renovations, has had to lay off four laborers in the last year, to a remaining staff of 17, because of declining contracts. "We're worried about future business volume and jobs," Stepnowski said.
On Thursday, most of the major U.S. retailers, another major source of jobs for people without college degrees, reported annual sales declines of more than 10 percent and in some cases more than 20 percent, translating into enormous job cutbacks. Last Monday, Circuit City announced it was closing 155 stores and eliminating more than 7,000 jobs.
YouthBuild, which runs school and training programs around the country, has tried to adapt to the changing job market, not simply giving young people a high-school degree but helping them prepare for fields with a future, meaning technical schools or community colleges for some, four-year college for others.
But transitional jobs, to sustain graduates as they train, are harder to find. Miguel DeJesus, 21 and a graduate of the charter school, has two small children and plans to marry their mother soon, and his goal is to work while he gets certified in building maintenance.
In recent months DeJesus has been applying to retail stores and fast-food outlets, poring over classifieds and Craigslist and walking into places cold to inquire. But everywhere, he said, he is told that, far from hiring, employers expect to lay off workers.
"I have to put school on hold while I find a way to support my family," DeJesus said. "If I could get a job anywhere now I'd be grateful."
Low-income women with children can face particular challenges. Kristin Seefeldt, a sociologist at the National Poverty Center at the University of Michigan, has closely followed 43 low-income women since 2005, and as expenses have climbed while work hours declined, many have survived by building up large debt on credit cards and to utilities, where they make minimum payments to keep the heat and electricity from being turned off, but are unable to chip away at balances of several thousands of dollars.
Several of the women have temporary nonunion jobs with the Detroit area's remaining auto-parts manufacturers. The jobs provide no benefits or security but may pay $12 an hour, as opposed to $8 in fast food or sales. With the auto industry in crisis, Seefeldt said, "the women are really concerned that the companies will go under and they'll lose these jobs."
Fred Davie, president of Public/Private Ventures, a group in Philadelphia that develops and studies antipoverty programs, said that as the U.S. government considered new stimulus measures, it could help the poor as well as the economy by investing in construction and increasing cash benefits for the needy, who will spend the money immediately.
"The new administration will have to think several levels down the ladder," Davie said, "so the government invests not only in the top but also in infrastructure jobs and training for low-income people to get some of those jobs."
Executions of civilians reported on both sides of Congo conflict
The Associated Press
Sunday, November 9, 2008
KIBATI, Congo: Rebels and pro-government militiamen executed civilians last week in two waves of terror that the top United Nations envoy to Congo said this weekend amounted to war crimes - ones that highlight the inability of undermanned UN peacekeepers to protect civilians.
On Saturday, the Congolese Army, advanced toward rebel lines Saturday, with renewed fighting near the provincial capital of Goma threatening a cease-fire.
Fighting broke out Friday near Kibati, about 10 kilometers, or six miles, north of Goma. By Saturday morning the army had moved 800 meters, or 2,600 feet, north into a no man's land that had been unpatrolled since the rebels called a truce 10 days ago after routing the army.
The UN envoy, Alan Doss, said "war crimes that we cannot tolerate" were committed at Kiwanja, by the rebels following Laurent Nkunda and by Mai Mai militiamen supporting the government.
UN investigators visited 11 graves Friday that contained what villagers said were 26 bodies, said a UN spokeswoman, Sylvie van den Wildenberg.
Van den Wildenberg and a UN military spokesman, Lieutenant Colonel Jean-Paul Dietrich, said it appeared that the rebels carried out many more executions than the militia.
Doctors, meanwhile, struggled Sunday to contain an outbreak of cholera in a refugee camp near Goma, and the fighting ignited fears that infected patients could scatter and start an epidemic.
Médecins Sans Frontières said it treated 13 new cases of cholera Sunday and had seen 45 cases at Kibati since Friday. The organization said dozens of people had died of cholera in recent weeks elsewhere in eastern Congo
Doctors also fear a cholera epidemic has broken out north of Goma behind rebel lines, where access has been limited by fighting and rebels have driven tens of thousands of people from camps where outbreaks had been contained.
UN peacekeepers have a well-established base in Kiwanja, about 80 kilometers north of Goma, but there are only 120 UN soldiers in the town of 30,000 to 50,000. Dietrich said the peacekeepers were pinned down for some of the first day of the killings Tuesday and were hampered because militiamen were hiding in houses among civilians.
Even in the crossfire, UN peacekeepers ventured from their camp to rescue 15 aid workers who had come to do the first assessment of humanitarian needs behind rebel lines in weeks, Dietrich said.
Peacekeepers also were trying to stop rebel attacks on two other towns, Nyanzale and Kikuku, on Wednesday while the killings in Kiwanja continued, he said. "It's very difficult to protect thousands of civilians, especially at night," Dietrich said.
UN officials said residents suffered two waves of terror: First the Mai Mai militia came and killed those it accused of supporting the rebels; then the rebels won control and killed those they charged had supported the Mai Mai.
The rebels also looted and burned homes and a hotel. They killed many people with bullets to the head, residents said, some of whom added that the rebels dressed the dead, most of them young men, in military uniforms.
"It's not justice," said Jean Katembo, a Kiwanja municipal judge. The rebels "kill people with no respect for the law."
Nkunda, the rebel leader, has already been accused of crimes against humanity, and the government issued an international arrest warrant for him after he defected from the army in 2004. The warrant cites war crimes, including the massacres of civilians in 2002 when he was still in the army, and in 2004 when he took his rebellion to the eastern town of Bukavu. Nkunda has accused the government of committing war crimes.
Over 250,000 people have fled from their homes since Nkunda began his offensive on Aug. 28 and captured large swaths of eastern Congo as the army retreated. The conflict is fueled by ethnic hatred left over from the 1994 slaughter of a half-million Tutsis in Rwanda. Nkunda first said he was fighting to protect minority Tutsis from Rwandan Hutu rebels who took part in the genocide and then fled to Congo. Lately he has said he is fighting to "liberate" all Congo from what he calls a corrupt government.


UBS chief to forego $10 million in exit pay
The Associated Press
Sunday, November 9, 2008
BERN, Switzerland: Peter Wuffli, the former chief executive of UBS, has renounced about $10 million in payments he was to receive under his contract when the troubled Swiss lender fired him as the subprime crisis began, UBS said Sunday.
A bank spokeswoman confirmed what Wuffli, who left Zurich-based UBS in July 2007, told the weekly NZZ am Sonntag in an interview Sunday.
"I understand the widespread indignation," Wuffli said in disclosing that he already had turned down a payment of "substantial millions" a year ago and that he went to the bank recently and told it to keep the rest of the 12 million francs, or $10.2 million, it owed him.
The move by Wuffli adds to pressure on other former UBS top managers, including the former chairman, Marcel Ospel, to give back bonuses and other payments credited to them by the bank as it ran up such losses that it received a near $60 billion bailout package from the Swiss government last month.
"I have voluntarily renounced a total of 12 million francs that was due me under my contract," Wuffli said in the interview. "High payments cannot be justified for top people who leave an enterprise suffering difficult circumstances."
The UBS spokeswoman, Sabine Jaenicke, confirmed Wuffli's decision and said it was the first by any former top manager so far. "It remains to be seen if other people will follow Wuffli's example," she said.
The bank is due to report to shareholders later this month how much in such payments is being returned by all executives.
She refused to say how much more was due to Wuffli.
The payments were not performance bonuses but part of Wuffli's salary package. He was entitled to a full year's salary under the contract in effect when he was fired July 6, 2007.
The bank's 2007 annual report says a total of 60.6 million francs was assured to Wuffli and two other executives - financial chief Clive Standish and investment banking head Huw Jenkins - who left in September with entitlement to another year's salary. The report doesn't break down the total by individual executive.
In addition, the three executives together received nearly 33 million francs for the time they were still in office last year.
The bank disclosed earlier this month that no bonuses would be paid to the Marcel Rohner, the current chief executive, and 12 current board members. Peter Kurer, the UBS chairman, said he would forgo any bonus for 2007 and 2008 until the bank has recovered from huge losses in the global financial crisis.
It is unclear how much bonus Kurer would have been entitled to, but his salary without additional payments is 2 million Swiss francs.
Ospel saw his salary when he was chairman drop from 26.6 million francs in 2006 to 2.57 million francs in 2007 when he renounced a bonus because the bank lost billions in writedowns on subprime mortgage investments. Ospel stepped down in April under pressure from shareholders.


Glimpse into a new financial system
Sunday, November 9, 2008
By Natsuko Waki
Investors get a first glimpse of the likely shape of the new global financial system this week as finance chiefs prepare for a summit of world leaders fighting the worst world financial crisis in 80 years.
After more than two months of relentless selling cut a third off the value of world stocks, central banks have launched an unprecedented round of interest rate cuts to help prevent economies from sliding deeper into recession.
Such drastic action, which has helped to lift stocks from the October trough, is prompting calls for governments to follow up central banks by delivering tax cuts and fiscal stimulus.
Finance ministers and central bank chiefs from the Group of 20 industrial and developing nations are likely to be tackling this as they prepare a summit of G20 government leaders on November 14-15 in Washington. The finance chiefs will meet in the U.S. capital on Thursday, following up on weekend talks in Brazil.
"The roadmap so far has been painted by central banks but not governments. The conversation may turn from money markets and banking to the real economy -- what can be done to rejuvenate the economy?" said Michael O'Sullivan, director of asset allocation at Credit Suisse's Private Banking.
"Central banks have provided monetary stimulus. As for fiscal stimulus, government needs to be careful. They need to spend efficiently."
The summit is expected to focus on identifying the underlying causes of the crisis, establish principles for reform and set up working groups to address specific issues.
The International Monetary Fund is planning to push the G20 nations for a quick fiscal expansion to help to lift the economy. British Prime Minister Gordon Brown has also called for fiscal action.
Investors will also keep a close eye to see if U.S. President-elect Barack Obama's picks for key economic jobs could stem the tide of bad news after market euphoria following his election victory quickly evaporated.
Gloom over the economy was so great that an unprecedented 1.5 percentage-point interest rate cut from the Bank of England and monetary policy easing in the euro zone and Switzerland last week did little to bolster risky assets.
"They can do whatever they want with interest rates but if banks don't lend and consumers are not spending, that seems to be the crux of the problem," said Richard Robinson, investment manager at Jersey-based fund Ashburton.
"The velocity of money is zero. One hundred times zero is still zero. You need the velocity of money and the willingness to spend starting again."
According to Goldman Sachs calculations, G10 economies outside Japan have delivered on average 190 basis points of peak-to-trough easing. Interest rate markets are discounting total average easing of just over 300 bps across the group.
This compares with average easing of 330 bps seen in 2001-2004, although Goldman expects the economic slowdown this time would be at least as severe as during the 2001-2004 cycle.
Reuters polls show analysts expect UK interest rates to drop to 2.0 percent by March from 3.0 percent now, and the euro zone cost of borrowing to fall to 3.0 percent next month from 3.25 percent.
In the case of the United States, interest rate markets are attaching a more than 1 in 2 chance that the benchmark borrowing cost will fall to 0.5 percent from 1.0 percent.
If this week's corporate earnings -- including retailers Wal-Mart and Macy's and European firms ING and Vodafone -- undershoot expectations, investors could price in even further easing from major economies.
A steady stream of weak economic data, reinforced by Friday's data showing U.S. employers cut payrolls by a shock 240,000 in October, helped to deflate optimism brought by Obama's victory last week.
The grim state of the economy makes Obama's choice for the Treasury Secretary all the more crucial. Names considered for the job include Timothy Geithner, president of the New York Federal Reserve; former Treasury Secretary Lawrence Summers and former Fed chairman Paul Volcker.
Summers and Volcker are on the 17-member transition economic advisory board which met on Friday. Others included Berkshire Hathaway chairman Warren Buffett and Roger Ferguson, former vice chairman of the Fed board of governors.
"It is likely that Obama will move decisively to tackle the immediate economic issues with the most significant action to be taken in the near term being a material fiscal stimulus package, probably in excess of $200 billion," said Paul Niven, head of asset allocation at F&C.
"The near-term corporate and economic environment ensures that markets' initial euphoria will likely give way to a more sober assessment as Obama's plans become viewed as a damage limitation exercise rather than a precursor to renewed economic vigour."


Study says fund managers improve governance focus
Monday, November 10, 2008
LONDON: Fund managers are incorporating more environmental, social and governance (ESG) factors into their investment strategies due to pressure from asset owners such as pension funds, a report said on Monday.
A study by responsible investment charity FairPensions said F&C Asset Management, HBOS's Insight Investment, Hermes Fund Managers, Aviva Investors and Standard Life Investments were the leading fund managers incorporating ESG factors into their decision making.
Fund managers, who manage billions of pounds on behalf of pension schemes, have come under pressure for failing to demand greater accountability from banks.
"Laggards" at the bottom of a FairPensions table ranking 30 of Britain's largest fund managers based on their responsible investment strategies and activities were State Street Global Advisors, Lloyds TSB's Scottish Widows Investment Partnership, Artemis Investment Management, Invesco Perpetual and Credit Suisse Asset Management.
Despite the overall improvement, the study said the impact on investee companies remains "elusive," with many fund managers unable to show any evidence of change in corporate behaviour on ESG concerns.
"The findings of this report indicate that asset managers have some way to go in reassuring clients and society more broadly that they are capable of protecting and enhancing value in connection with ESG factors," FairPensions said.
(Reporting by Raji Menon; Editing by Jon Loades-Carter)


Restore a sense of fairness
By Alan S. Blinder
Sunday, November 9, 2008
Among the daunting set of tasks ahead for the president-elect, perhaps the most basic is to restore a sense of fairness to and faith in our economic system — much as Franklin D. Roosevelt did in the 1930s.
For too many years, too many Americans watched helplessly as the economic world passed them by, the top dogs prospered, and their national government either sat by passively or intervened to help the "haves." No wonder trust in the system plummeted. It was hanging by a thread when the financial crisis erupted. Now, it has been destroyed.
An economy isn't supposed to work that way. Our celebrated capitalist democracy is designed to be a participation sport — not a spectator sport — and one in which the average American can still win. So the new president's most fundamental job is to restore the people's confidence that the economy will perform — for them.
While any new president would prefer a loftier starting point, Barack Obama will have to begin with the troubled Troubled Asset Relief Program. The way the Bush administration started it has left the $700 billion bank bailout in danger of becoming the most unpopular use of public money in the history of the republic — unless something is done fast.
If it's not already too late, the new president must convince Americans that the bailout is being managed for their benefit, not for Wall Street's. Because the first $250 billion or so is being doled out to banks without asking anything in return, this will be no easy task. Quick changes in the bailout program — and I mean changes that ordinary people can understand — are necessary.
I'd start by sending a large dollop of that bailout money to Main Street — literally. That means devoting substantial sums to refinancing home mortgages that might otherwise go into foreclosure, which is what the head of the Federal Deposit Insurance Corporation, Sheila Bair (bless her heart!), has been urging for months. The president-elect can be a powerful ally for Bair.
There are a number of ways to mitigate the impending wave of foreclosures. To those who object that refinancing mortgages one at a time is too slow, Obama should have two replies. First, let's end the delays and get started. Second, the Home Owners' Loan Corp. took on a much larger task — relative to the economy's size — in the New Deal, and succeeded admirably. Can't we match the speed of the 1930s? Yes, we can.
Next up, after reforming the bailout plan, is the Economic Recovery Act of 2009. Given the likely severity of the economic slide, a large dose of fiscal stimulus — amounting to perhaps 2 percent of gross domestic product, or roughly $280 billion — is needed either in the lame-duck congressional session this month or soon after Inauguration Day. The new president must guide Congress away from passing an unprincipled hodgepodge of members' favorite projects that would just remind the public of what's wrong with Washington. Instead, we need a bill that has clear objectives, is well designed to achieve them, does not do long-term harm in the name of short-run help — and can be explained to the body politic.
Regarding objectives, I'd suggest sticking to two: creating jobs by creating new spending, and alleviating the misery that accompanies deep recessions.
The first criterion points toward such items as more generous unemployment insurance and food-stamp benefits, because that money will be spent quickly. It also points toward grants and loans to hard-pressed state and local governments, so they don't cut their spending or raise taxes. Because this recession will likely be lengthy, not fleeting, a large-scale public infrastructure program — with vigorous anti-pork provisions — also makes sense.
Again, the New Deal offers examples. Temporary institutions like the Civilian Conservation Corps and the Works Progress Administration provided much-needed jobs but also left a legacy of new public infrastructure — the people's capital, if you will.
The second criterion again points toward more generous unemployment insurance and food-stamp benefits, but also toward policies like these: expanded trade adjustment assistance for displaced workers, more home heating assistance for low-income households, broader health insurance coverage — a step toward universal coverage — and a plan that gets serious about job retraining. (Here, tiny Denmark may be a good model.)
These and related programs are often referred to as the "social safety net," and America's is in tatters. But we need both repairs and a new metaphor. President Lyndon B. Johnson had it right when he called upon the government to provide a "hand up, not a handout." The Obama administration should seek to create a new "social trampoline" that not only catches people when they fall, but also propels them back into productive employment. If properly designed, such a social trampoline would both ease the short-run pain of recession and facilitate the long-run adjustment to globalization.
And at every step along the way, Obama should make abundant use of the presidential bully pulpit to explain, to cajole and to bring along not just the Congress, but also the people — just as Roosevelt did. Americans need to feel, once again, that it's their economy, and that the government is working on their behalf. Here, a little eloquence can go a long way. Fortunately, we just elected a man who has a lot.


Listen, and obey the laws of arithmetic
By N. Gregory Mankiw
Sunday, November 9, 2008
It was a good campaign, and a historic victory. As the president-elect gets ready for new responsibilities, here are four ways to become a reliable steward of the economy:
LISTEN TO THE ECONOMISTS During the campaign, Senator Barack Obama assembled an impressive team of economic advisers from the top U.S. universities, including Austan Goolsbee of the University of Chicago and David Cutler and Jeffrey Liebman of Harvard. The campaign's director of economic policy, Jason Furman, is a smart, sensible and well-trained policy economist. I know: he is a former student of mine.
It would be a good idea to pay close attention to what they have to say. They will often give advice quite different from what will be coming from the congressional leaders Nancy Pelosi and Harry Reid. To make sure the views of economic advisers are heard, they should have offices close to the Oval Office. The chief of staff should invite them to all the relevant meetings.
EMBRACE SOME REPUBLICAN IDEAS No party has a monopoly on truth. It would be wise to adopt the best Republican policy proposals, as Bill Clinton did with welfare changes in 1996.
Health policy is a case in point.
Over the past several months, Obama lambasted Senator John McCain's proposal to change the tax code to include a refundable health insurance tax credit. But long before McCain ever proposed this idea, it was advanced by Furman, the Obama campaign's policy director. He can explain why the Furman-McCain plan makes a lot of sense.
Now the new president may decide that this plan does not go far enough. He may want a more generously funded social safety net to help the less fortunate get health care. Fair enough, but in pursuing that goal, he will run into the next issue.
PAY ATTENTION TO BUDGET CONSTRAINTS The United States faces a long-term imbalance between government spending and tax revenue. The fundamental problem is that the U.S. government has promised the elderly more benefits than the tax system can support. This fiscal imbalance will become acute as more baby boomers retire and start collecting benefits from Social Security and Medicare, two government programs for the elderly.
Yet during the campaign, Obama promised to cut taxes for 95 percent of Americans, to vastly expand health insurance coverage and never to cut Social Security benefits or raise the retirement age. The new administration will almost surely have to renege on some of these promises. As the economic team will often say, even if the laws of arithmetic are ignored during campaigns, they become a real constraint when making actual policy.
RECOGNIZE PAST MISTAKES As a new senator, Obama voted along predictable leftist lines. As president, he will need a more eclectic, nuanced approach.
Consider trade policy. In the Senate, he voted against the Dominican Republic-Central America Free Trade Agreement. He opposed free-trade agreements with Colombia and South Korea. He supported Senators Charles Schumer, Democrat of New York, and Lindsey Graham, Republican of South Carolina, in their quest to put tariffs on Chinese goods if China failed to revalue its exchange rate. He supported the Byrd Amendment, which encouraged American companies to file antidumping suits against foreign competitors. He supported subsidies for American producers of corn-based ethanol and tariffs on imports of more efficient sugar-based ethanol.
The team of economists can explain why these positions were wrong-headed. Economic isolationism is not in the national interest. A high point of the Clinton presidency was the enactment of the North American Free Trade Agreement, which passed both the House and Senate with a majority of Republicans and a minority of Democrats.
Last Tuesday, many people voted for Obama hoping that he would achieve the kind of economic success that Clinton enjoyed in the 1990s. The best chance of delivering what they want requires abandoning some positions and pursuing a more moderate, bipartisan course.


Investors want transparency in derivative holdings
Monday, November 10, 2008
By Raji Menon
A heavyweight investor group called for greater transparency in equity and derivatives transactions ahead of a G-20 summit aimed to restore confidence in global financial markets.
The International Corporate Governance Network (ICGN), whose member companies manage some $15 trillion (9.5 trillion pounds) in assets, is demanding tougher rules after the short-selling debacle around Volkswagen cost hedge funds billions of dollars.
While not advocating a blanket ban on short-selling -- which it called a "legitimate tool" -- the group bashed large speculative positions built up "in obscurity."
"We do not believe short selling should be artificially restricted, but companies and shareholders should be aware when significant short positions are being created," ICGN said in a statement on Monday.
Hedge funds holding short positions in German car maker Volkswagen lost billions after Porsche revealed it had built up 74.1 percent in its rival. Nearly 32 percent of the stake was held through derivative contracts.
Peter Montagnon, chairman of ICGN, told Reuters: "We would definitely have liked to see the extent of Porsche's holding in Volkswagen ... we have members whose are invested in Germany and so we would like to see this issue addressed."
The investor group also wants its members to have powers to appoint and dismiss boards and to have a say on remuneration, particularly in the United States.
Fund managers, who manage billions on behalf of pension funds, have also been criticised for their role in the current market crisis for failing to hold boards to account.
"Stronger rights will enable shareholders to hold boards more firmly to account for the longer term consequences of their actions. This is important because more effective boards are vital to prevent a recurrence of the crisis," the body said.
It said that government intervention in financial institutions should not undermine shareholder rights and corporate governance structures, including the requirement for fully independent directors.


Emerging economies want say in financial reforms
The Associated Press
Sunday, November 9, 2008
SÄO PAULO: President Luiz Inácio Lula da Silva of Brazil demanded that major changes of the international financial system include strong input from large emerging nations and said the collapse of modern banking structures is victimizing the world's poor.
Da Silva said Saturday that those who have the least stand to lose the most from a credit crunch that has slammed businesses from Brazil to China.
"We need a new, more open and participative governance," said da Silva. "This is not the moment for narrow-minded nationalism or of individual solutions."
He spoke at a meeting of finance ministers and central bank presidents from the Group of 20 wealthy and emerging economies before a summit meeting this week in Washington.
The Group of 20 nations must "formulate proposals for a substantial change of the world's financial architecture," da Silva said. "This system collapsed like a house of cards that dragged down with it the dogmatic faith in the principles of nonintervention by the state in the economy."
In closed-door talks, leaders also discussed ways for nations to increase government spending to counter a global economic slowdown that could cause international trade to contract next year for the first time since 1982, said the president of the World Bank, Robert Zoellick.
In particular, "China is in a very good position to have a strong fiscal expansion," Zoellick said. "This is something the Chinese authorities talked about."
The Chinese central bank governor, Zhou Xiaochuan, said the Asian export powerhouse, one of the few remaining engines of global economic growth, would help stabilize markets by maintaining its economic growth. He said the Chinese economy would expand by 8 percent and 9 percent in 2009.
The Canadian finance minister, Jim Flaherty, said slowing economic growth was damping inflationary pressure, giving central banks room to cut interest rates.
"There are ongoing conversations about who plans to do what when" on interest rates, Flaherty said. "I expect that these discussions will lead to some degree of coordinated action."
Da Silva said millions of people in developing nations are suffering from a worldwide credit crunch that started in the United States and Europe and has spread to rapidly growing emerging market nations. In Brazil, farmers are are planting less soy, and corporations are cutting output of iron ore, steel, automobiles and other products.
After lending by rattled American and European banks slowed, foreign investors sold off emerging market assets, forcing extreme measures by governments including Brazil's to prop up sagging currencies and provide credit lines to companies.
"Foreign investment funds are withdrawing their assets in the capital markets of emerging countries to cover the losses they sustained in advanced markets," da Silva said. "This loss of funds affects balance of payments and makes it difficult for companies to finance themselves."
France has proposed incorporating emerging economies into the exclusive Group of 8 industrialized nations. The Brazilian finance minister, Guido Mantega, suggested that group should include as many as 15 countries, but didn't specify which emerging-market nations besides Brazil, Russia, India and China should be allowed to join.
European leaders suggested Friday that the International Monetary Fund could also become the world's financial watchdog, with increased powers to curb financial crises with more money to aid troubled economies,
But Brazil and other emerging-market nations have long complained that their representation in the fund and the World Bank is insufficient. Da Silva said the Group of 20 was better positioned to forge new international financial regulations, because it more broadly represents both rich and developing countries.
David McCormick, the U.S. Treasury Department's undersecretary for international affairs, said Washington supported giving Brazil and other developing nations a significant role.
Silva "presented a constructive overview of the challenges we face and the need for developed and developing nations to work together in addressing those challenges," McCormick said in a statement.
Zoellick said large emerging economies will inevitably form part of whatever group wins the task of rebuilding and strengthening the financial system. But he warned that extremely poor nations whose economies are most vulnerable, including many in Africa, also need a voice because their citizens will be most hurt by the current turmoil.
"We need to make sure that the financial crisis doesn't become a human crisis," Zoellick said.


Increase government spending, and change what gets taxed
By Robert Frank
Sunday, November 9, 2008
The country is now in the midst of the deepest economic crisis since the Great Depression. But as a new administration prepares to enter the White House, the crisis could end up being a potent ally for change. Without it, political resistance to the steps needed to address our most acute and longstanding economic problems would be almost insurmountable.
Despite broad agreement that the nation needs to increase spending in many domains — including infrastructure, health care, scientific research and clean energy development — no one has forged a legislative coalition capable of raising the necessary tax revenue. But with the country sliding into what promises to be a sharp and protracted economic downturn, it is imperative to increase spending over the short run, regardless of how we pay for it.
Even stalwart conservatives concede the point. For example, Martin Feldstein, the Harvard economist who was an adviser to the campaign of Senator John McCain, recently wrote in The Washington Post, "The only way to prevent a deepening recession will be a temporary program of increased government spending." Feldstein suggested that government might need to offset a shortfall of some $300 billion in household spending.
In the long run, though, it will be necessary to raise enough tax revenue to balance the budget. One of the most effective ways to do that is by changing what we tax. Most U.S. government revenue now comes from the income tax. Because a family's annual income equals the amount it spends each year plus the amount it saves, we are effectively taxing savings. And savings rates have fallen precipitously, often dipping into negative territory as families have used home equity loans and credit card debt to spend more than they earned. Because the country needs to save more, taxing savings makes no sense.
The first reform that Barack Obama should consider is replacing the progressive income tax with a progressive tax on consumption. A family would report its income to the Internal Revenue Service as it does now, and also its savings, as it now reports contributions to retirement accounts. Annual consumption would then be calculated as the family's income minus its savings. Its taxable consumption would be that amount minus a large standard deduction — say, $30,000 for a family of four.
A family that earned $60,000 and saved $10,000, for example, would have taxable consumption of $20,000. Initial tax rates on consumption would be low, and would then rise steadily with consumption, topping out at higher levels than the current top rates on income.
Such a tax could raise more revenue than the current system, yet would be far less burdensome for families at nearly all income levels. Because of the large standard deduction, middle-income families would pay less than they did before, and high-income consumers could limit their tax increases by saving more.
How painful would that be? Some wealthy families now spend millions of dollars on coming-of-age parties for their children. A steeply progressive consumption tax would encourage them to spend less, which would not be much of a sacrifice, since the main effect would be to lower the bar that defines an acceptable coming-of-age party for people in their tax bracket.
Other changes in what we tax could further reduce the revenue shortfall while producing positive side effects. Energy and climate specialists, for example, have long advocated taxes on carbon. The burden of these levies would be lessened by the resulting reductions in pollution and congestion.
Imposing new taxes is never easy. But recent research suggests innovative ways of making it more palatable. Behavioral economists have shown that the pain caused by a loss is far greater than the pleasure caused by a gain of the same magnitude. This asymmetry, called loss aversion, helps explain why it is so hard to pay higher taxes. Doing so means reducing consumption now — a loss that is immediately painful.
To overcome this hurdle, Congress could vote to increase future taxes — a strategy that happily coincides with current fiscal imperatives. Tax increases are never a good idea when the economy is in the doldrums, but the current downturn will not be permanent. Higher taxes could be phased in gradually, after income growth resumes. As long as each year's tax increase is smaller than the corresponding growth in income, painful reductions in consumption will not be necessary.
Evidence supporting this strategy comes from "Save More Tomorrow," a payroll savings program designed by the economists Richard Thaler and Shlomo Benartzi. Under this program, workers can allocate a portion of future salary increases to retirement savings accounts. Hundreds of corporations report that their employees began saving at sharply higher rates after the introduction of this program.
It would be quixotic to imagine that losses from the current economic meltdown won't be painful. But the crisis also opens new doors to policymakers — providing them with options that would have seemed unthinkable just a few months ago.


Deported from U.S. in a coma, returned to U.S. to be saved
By Deborah Sontag
Sunday, November 9, 2008
GILA BEND, Arizona: Soon after Antonio Torres, a husky 19-year-old farmworker, suffered catastrophic injuries in a car accident last June, a Phoenix hospital began making plans for his repatriation to Mexico.
Torres was comatose and connected to a ventilator. He was also a legal immigrant whose family lives and works in the purple alfalfa fields of this southwestern town. But he was uninsured. So the hospital disregarded the strenuous objections of his grief-stricken parents and sent Torres on a four-hour journey over the California border into Mexicali.
For days, Torres languished in a busy emergency room there, but his parents, Jesús and Gloria Torres, were not about to give up on him. Although many uninsured immigrants have been repatriated by U.S. hospitals, few have seen their journey take the U-turn that the Torreses engineered for their son. They found a hospital in California willing to treat him, loaded him into a donated ambulance and drove him back into the United States as a potentially deadly infection raged through his system.
By summer's end, despite the grimmest of prognoses from the hospital in Phoenix, Torres had not only survived but thrived. Newly discharged from rehabilitation in California, he was haltingly walking, talking and, hoisting his cane to his shoulder like a rifle, performing a silent, comic, effortful imitation of a marching soldier.
"In Arizona, apparently, they see us as beasts of burden that can be dumped back over the border when we have outlived our usefulness," the elder Torres, who is 47, said in Spanish. "But we outwitted them. We were not going to let our son die. And look at him now!"
Antonio Torres's experience sharply illustrates the haphazard way in which the U.S. health care system handles cases involving uninsured immigrants who are gravely injured or seriously ill. Whether these patients receive sustained care in the United States or are privately deported by a hospital depends on what emergency room they initially visit.
There is only limited U.S. financing for these fragile patients, and no governmental oversight of what happens to them. Instead, it is left to individual hospitals, many of whom see themselves as stranded at the crossroads of a failed immigration policy and a failed health care system, to cut through a thicket of financial, legal and ethical concerns.
The two U.S. hospitals treating Antonio Torres approached his case from distinctly different perspectives. St. Joseph's in Phoenix, with a focus on keeping down the rising cost of uncompensated care, repatriates about eight uninsured patients a month.
"We're trying to be good stewards of the resources we have," said Sister Margaret McBride, a hospital vice president. "We're trying to make sure that the acute-care hospital is available for individuals who need acute care. We can't keep someone forever."
By contrast, El Centro Regional Medical Center in California said that it never sent an immigrant over the border. "We don't export patients," said David Green, its chief executive. "I can understand the frustrations of other hospitals, but the flip side is the human being element."
Hospitals are required to screen and treat all those who arrive at their emergency rooms. But they receive only partial compensation for illegal immigrants, and it ends when the patient is stabilized.
But hospitals are also required to discharge safely patients who need continuing care, leading to their quandary: They generally cannot find nursing homes to accept illegal immigrants, or legal ones with less than five years' residency, because long-term care is not covered by emergency Medicaid.
Hospitals in New York face dilemmas as complex as do their counterparts in the Southwest, with the added dimension of a more diverse immigrant population and prospective repatriations to Africa and Asia. The case of Kong Fong Yu has stymied a community hospital in Lower Manhattan.
Yu, 53, suffered a stroke on May 14, 2007. He awoke with slurred speech and then collapsed on his bathroom floor. By the time he arrived at New York Downtown Hospital, it was too late to try to reverse damage to the brain, the hospital said in court papers.
The hospital admitted Yu for tests and to regulate his high blood pressure, which he had been treating with Chinese herbs. Almost immediately, Yu was considered medically stable and ready for discharge to a skilled nursing home. But since he was uninsured and ineligible for Medicaid, no nursing home would take him. He had no relatives in the United States.
So he stayed, and stayed. And he was not the only one. Jeffrey Menkes, the hospital's president, said Downtown housed a few uninsured immigrants like Yu at any given moment, which costs the hospital $1.5 million to $2 million a year. It also costs patients like Yu the chance to receive the intensive rehabilitation that they need.
Yu, according to a hospital document, can "perform some independent activities of daily living, including turning in bed and feeding himself." But he is "dependent on staff for other daily necessities" and suffers from "limited cognition and limited independent judgment."
Yu said that he entered the United States legally 11 years ago and then overstayed his visa to work "on the black market" as a cook. Speaking in Mandarin that was translated by a hospital employee, Yu said he was grateful to Downtown. "American hospitals are very humane," he said. "I have no money. This hospital is giving me food, a bed and care."
But the hospital does not want him to stay indefinitely. Last winter, Menkes said, at a moment when he had patients "stacked up in the emergency room," he realized that he needed to find a way to discharge patients like Yu. Shortly thereafter, the hospital went to court to get a guardian appointed.
When Katherine Huang, a Chinese-American lawyer, was appointed his guardian last spring, the hospital planned to transfer Yu to a Brooklyn nursing home and support his stay.
But the hospital later changed course. In late September, Yu entered the courtroom of New York State Supreme Court Judge Lottie Wilkins on a taxi-yellow gurney. Dressed in a hospital gown, he smoothed his thin hair and saluted the judge in English. Squeezing a small rubber ball for exercise, he was then wheeled behind closed doors, accompanied by his guardian, for what Wilkins called a status conference, closed to the news media.
No record was made of the proceeding. But the guardian said that she learned then that the hospital was contemplating sending him back to his relatives in China.
"All of a sudden, it became, 'Great, the family wants him back,' after the hospital repeatedly told me the family did not," said Huang, the guardian.
The hospital declined to discuss the case, citing patient confidentiality. Menkes said, "We are not going to force people back" to their homelands.
After the September hearing, The New York Times contacted Yu's 30-year-old son in Ningbo, China. Cheng Jun Yu, the son, said he and his mother had been estranged from Yu since he left for the United States. "The family situation wasn't merry," he said.
"We do not wish for him to return," he continued. "He will be a burden for me, and I do not have the time or resources to care for him. My mother has established a new family, and I do not wish for this matter to disrupt her life. If they want to send him back, they will have to negotiate with the Chinese government to see if the government will care for him."
Antonio Torres's journey through the U.S. - and Mexican - health care systems began at dawn on June 7, when the 19-year-old, driving to work across a rutted, gravelly dirt road on the ranch where his family lives, flipped his pickup truck. He was found, unconscious, about 150 feet, or 45 meters, from his vehicle by a ranch hand.
That June morning, the Torreses followed behind an ambulance that took Antonio to St. Joseph's, the flagship hospital of Catholic Healthcare West, where he was admitted to the intensive care unit with a severe traumatic brain injury, bruised lungs and abdominal injuries. Two days later, his parents were unprepared for a hospital social worker's frank assessment of their son's prognosis.
"She said there was no hope for our son and that it would be best to unplug him," Mr. Torres said. "She said, 'You have to think what kind of life this is, hooked up to a ventilator. And if he wakes up, he will not be able to do much.' When we said, 'No!' the social worker said that, well, then, without insurance, they couldn't keep him."
Five days after the accident, the social worker, using an interpreter, called the public hospital in Mexicali to arrange Antonio Torres's repatriation. "Patient accepted for admission," her notes say. The following day, the notes add, "Parents upset."
The hospital delayed the repatriation for a few days, giving the elder Torres time to search for a nursing home. He came up empty, so the hospital moved to repatriate his son even though he was not only comatose and dependent on a ventilator but also had a very high white blood cell count, indicating infection.
Antonio Torres had pneumonia. A hospital physician temporarily blocked his transfer.
Two days later, early on June 20, his white blood cell count was still too high to meet the physician's condition for transfer, according to the social worker's notes. Nonetheless, a few hours later, with the same physician's consent, Antonio Torres was placed on a portable ventilator for his departure.
He spent several days in an emergency room in Mexicali before a bed opened up in a crowded ward. His parents said Mexican doctors advised them to take their son back to the United States if possible. Through their church, the Jehovah's Witnesses, the parents made contact with a church leader in El Centro, California, who took them under his wing, introduced them to the local hospital and raised money for "the best ambulances in the border area," the elder Torres said.
Within a week, his son was on his way back to the United States, where the El Centro hospital was waiting to take him in and write off his care as charity.
"This was a kid who came to this country legally, worked here legally and had an accident," said Green, president of the city-owned hospital. "For God's sake, don't we take care of our folk? To me, this case shows one of the disastrously broken pieces of our health care system."
Torres arrived from Mexico in septic shock, a potentially fatal condition caused by overwhelming infection. After 18 days at El Centro, he woke forcefully from his coma. "They took out his trach tube, he cleared his throat and said, 'Where's my mom?"' his father said.
Told of the progress that the younger Torres had made, McBride said, "That's wonderful," adding that she thought it a testament to the emergency care at her hospital. "Maybe if he had been in a different setting, he may not have survived," she said.
The Torreses have filed a detailed complaint against St. Joseph's with the Arizona health department, and the matter is under investigation.
Now Torres walks with a cane and speaks slurred but comprehensible Spanish. He is itching to climb back onto a combine and cut alfalfa alongside his father. For the moment, though, he is commuting with his mother from Arizona to California for therapy.
Back in Arizona, his father sat stolidly for hours on a worn couch in the concrete barracks-style housing where his family lives, letting the conversation swirl around him.
"Imagine if I had said, 'O.K., disconnect him,' " Jesús Torres said.
Pilar Conci contributed reporting from New York and Tina Lee from Ningbo.
Fifty African migrants storm Spain enclave
Saturday, November 8, 2008
RABAT: Moroccan police arrested 50 African migrants who stormed a gap in the fence surrounding Spain's wealthy enclave of Melilla early Saturday, Moroccan state news agency MAP reported.
The migrants tried to push their way through the hole in the six-metre, razor-wire fences opened up by recent storm flooding, MAP said, citing a security source.
Two security officers were injured trying to push back the migrants who included Cameroonians, Ivorians and others from Mali, Guinea and Sudan, the agency said.
It was the latest of several recent attempts to breach the heavily-guarded European outpost since the bad weather began.
Seven migrants tried to force their way through Friday. Around 30 others managed to reach Melilla on October 27 by overwhelming police guarding a damaged storm drain.
European governments have invested heavily in tighter border security, leaving thousands of African migrants stranded and destitute in Morocco, a country grappling with poverty and the threat of social unrest.
Some migrants have spent years camping in the forests near Melilla in the hope of reaching Europe and a better life. Hundreds of them stormed the fences guarding Melilla and its sister enclave Ceuta in 2005, when 11 were killed.

Back in Alaska, Palin finds things changed
By William Yardley
Sunday, November 9, 2008
ANCHORAGE: Governor Sarah Palin has returned to Alaska fully recast and amplified.
Adored by many national conservatives, Palin is a prospect for a presidential run in 2012, supporters say. Caricatured by opponents, she is a candidate for political oblivion, say others.
Regardless, Palin told reporters the day after Election Day, "This has been all positive for me."
Alaska, too, has been recast and amplified in the 10 weeks since Palin soared to national prominence as the Republican nominee for vice president, and the process has not necessarily been all positive.
Oil prices, which provide the bulk of state revenue, were well over $100 a barrel in late August when Palin left to campaign with Senator John McCain. Now they are slumming south of $60 a barrel, below the level required to balance the state budget. Increased scrutiny of Palin's time as governor often painted an unflattering portrait of her administration. Investigative news reports have portrayed Palin as being consumed with personal matters and vindictiveness, particularly in the controversy over the firing of her public safety commissioner in what has become known as Troopergate.
Many Democrats, her allies in passing key legislation to raise taxes on oil companies and spur development of a natural gas pipeline, are outraged by her partisan attacks on now President-elect Barack Obama and on the tactics of the McCain-Palin campaign here at home.
Within the state's Republican establishment — never Palin's comfort zone — there is tension over the fate of Senator Ted Stevens, who was convicted last month of failing to disclose gifts and free home renovations he received. Palin called on Stevens to resign even as state Republicans urged his re-election. A preliminary vote count suggests he could win a seventh full term.
Even if Stevens wins, he could still be forced to resign, and Palin is widely viewed as a strong candidate to win his seat in the special election that would have to be held to replace him.
Palin has largely dodged questions about her long-term political future, and as she gets back to governing full time, few people know what to expect from her in the immediate future.
"She's coming back to a whole different world from when she left," said State Representative John Coghill, a Republican from North Pole who is chairman of the powerful House Rules Committee. "If she comes back with a puffed up ego there's going to be problems. But if she comes back ready to work, that will be better."
Palin, in an interview in her office on Friday, said she was ready to work.
"Now we kick in that fiscal conservativeness that needs to be engaged, and we progress this state with $57-a-barrel oil," Palin said. She said the state would have to "be prudent with public dollars and provide services more efficiently than have ever been provided in the state of Alaska before."
The price and production of oil determines state finances: taxes on oil bring in about 85 percent of state revenue. To balance the budget for the 2008-9 fiscal year, the price of oil needs to average $74 over the 12 months, said Karen Rehfeld, director of the state office of management and budget. If it falls below that average, the state could have to make emergency cuts or dip into a reserve account that contains several billion dollars. High prices early in the fiscal year may help keep the average up this year, but next year is another matter.
Palin, first elected governor in 2006, has governed only in times of budget surpluses, and lawmakers said they had many questions about how she would lead now.
"I just don't know what kind of philosophy she's going to have when she comes back," said State Representative John Harris, a Republican and the departing House speaker.
Noting that his chief of staff, John Bitney, was once the governor's legislative director, Harris added, "We were just trying to figure out what kind of policy things the governor may want to address and we were kind of scratching our heads, because we don't know."
Harris was among several lawmakers who questioned whether Palin would spend the rest of her term, which ends in 2010, positioning herself to run for national office. Would she pursue a socially conservative agenda, promoting bills to restrict abortion or gay rights, issues she largely passed on in her first two years in office because she was trying to win support from Democrats on other issues? Would she move to the center? Would she continue to rail against "the old boy network," stoking her reformist image at the expense of her fellow Republicans, whose party has been tarnished by corruption scandals, including that of Stevens?
Palin rejected the idea that she would be playing to a larger audience.
"My actions will continue to be first and foremost in good service to the state of Alaska," she said in the interview.
But other than suggesting that cost cuts were to come, Palin did not hint at a broader agenda.
The governor is due to submit her 2009-10 budget next month, and neither she nor her aides offered specifics about what it might contain. The McCain-Palin campaign portrayed Palin as an energy expert, and one top priority Palin expressed well before she was selected to run for the vice presidency was to improve energy sources for different parts of the state. That includes finding cheaper sources of energy for rural villages, which often rely on inefficient diesel power, as well as for cities like Fairbanks, the state's second largest, where utilities rely on oil and coal.
The state also faces questions over issues like financing Medicaid, increasing mining in environmentally sensitive areas and spending on transportation projects, as well as the complex negotiations involved in trying to develop the gas pipeline with the cooperation of the same oil companies whose taxes Palin has raised.
Palin's partisanship on the campaign trail may be what most surprised people at home.
"She's coming back to a divided state, where Democrats had supported her but they watched her for two months call the president-elect of the United States a terrorist sympathizer," said State Representative Les Gara, Democratic of Anchorage. "She called him a socialist."
Her partisanship also surprised some conservative Republicans, who were accustomed to feeling ignored while Palin nurtured alliances with Democrats and moderate Republicans. Now, some Republicans who have been at odds with Palin in the past are wondering if her partisan tone on the campaign trail might mean they will have her ear more than before.
"It appears that way," said Coghill, the Republican from North Pole. Coghill said Palin's emphasis on socially conservative issues on the campaign trail has helped persuade him that now is the time to ask Palin to actively support a bill that would require minors seeking abortions to notify their parents in advance.
"There are some people in our caucus who are skeptical" that Palin might ally herself more with Republicans now, Coghill said. "But they're willing to take the chance, to step up and play."
Palin suggested in the interview that how she ran for vice president would not shape how she governs Alaska.
"If anybody wants to try to criticize and say, 'Oh, all of a sudden she's an obsessive partisan,' they're wrong," she said.
But she did allow that she thinks beyond her current role.
"Around every corner is something new," Palin said, "so I look forward to seeing what happens next. But for now, it's great to be back in the governor's office."

Reminiscences of old Baghdad by one of last Jews
Sunday, November 9, 2008
By Peter Graff
One of the last eight Jews in Baghdad, a portly retired accountant, erupts in a bellyful of laughter when asked why he never married.
"I was a playboy. Don't write that!" he jokes, grinning. "How old do you think I am? Wrong. I'm 65! Don't write that! Write that I am 55!"
His government ID proves his age, and on the back it says, unmistakably: "Religion: Jewish."
He has made contact with a reporter, not because he wants to tell the story of his persecuted community, but because he wants to complain about the landlord who is raising his rent.
"Because we are Jewish he knows we can do nothing. He isn't afraid because he knows we have no tribe here. Don't use my name."
Once one of the largest Jewish communities in the Middle East, Baghdad Jews have now nearly vanished while the country has been consumed by sectarian war.
Speaking in fluent English, the ex-accountant launches into a description of the Baghdad of his youth, one of the Muslim world's most cosmopolitan cities.
He recites the names of legendary social clubs where Jews, Christians and Muslims mingled in better days, with music and whisky and parties that ran through the night.
"So many people -- Muslim people -- say if the Jewish people come back it will be nicer," he says.
His family have left. Some are in London, some in the United States. His father was offered a chance to move to Canada, but turned it down because he wanted to die and be buried in Iraq.
The ex-accountant himself stayed, but if he can sell his father's house -- now a ruin bombed out in the Iran war in the 1980s -- he will finally leave.
"I want to sell the house and go. I like Iraq, but I am fed up. We had very nice times in Iraq, but now we don't like it."
Iraq's Jewish community dates from biblical times. According to Charles Tripp's History of Iraq, the country was home to 117,000 Jews in 1947.
Under Ottoman rule, well into the first half of the 20th century, Jews made up about a fifth of the population of the capital. Some of the villas in neighbourhoods along the Tigris still have six-pointed stars of David in their stucco.
How many Jews are there now?
"We know them all," says the ex-accountant, counting.
There's the ex-accountant himself, plus the nephew with whom he shares a rented house in Baghdad's central Karrada district. There's the man who lives near them, the man who leads the community, the very old woman, the male doctor and the female dentist. And the man whose brother was a goldsmith.
The goldsmith married the dentist a few years ago. A few months later, he was abducted by gunmen.
"They came to his house and took him. He disappeared. They left his car, they left his mobile. They just took him."
So that leaves eight. Eight Jews left.
The synagogue in central Baghdad has been boarded up since 2003. The ex-accountant occasionally runs into some of the other Jews on the street, but confesses he isn't much for religion.
"We don't know how to pray," he says. "Hebrew books we have everywhere in the synagogue, but we don't know how to read it. Some words I know. The important one is Adonai. Adonai is God. We believe in God."
In the old days, Jews were an integral part of Iraqi life. A relative of the ex-accountant was finance minister decades ago. But beginning in the late 1940s, successive Arab governments accused Baghdad's Jews of supporting Zionism.
Some were jailed, others were barred from government posts, and thousands upon thousands left for Israel or the West.
By the time of Saddam Hussein's fall, the ex-accountant estimates there were only a few dozen Jews left. Western organisations came and evacuated most of the rest.
"A woman called Rachel, she came here took some of them to the Jewish community in London, I think," he said.
In 2003, he went to the Green Zone to meet a cousin who was born in the United States and had come to Iraq to work for the U.S.-run administration. The American woman was shocked when her mother put them in touch.
"She said: incredible! You are still here? She did not know she had a cousin in Iraq," he said.
Apart from his quarrel with his landlord, the ex-accountant says he has had few problems with the neighbours, most of whom don't know he is Jewish, some of whom don't care.
"Somebody says 'You are Christian', I don't say anything. Somebody says 'You are Muslim', I don't say anything. I think most people think we are Christian because they don't know there are still Jews in Iraq."
(Editing by Matthew Jones)

Johnson looks forward to tougher challenges
Sunday, November 9, 2008
By Mitch Phillips
England manager Martin Johnson looked forward to the tougher challenges ahead after easing himself into his new job with Saturday's 39-13 victory over the Pacific Islanders.
After months of shuffling names on paper and studying videos, Johnson and his coaching team have something to build on before next week's match against Australia and the subsequent tests against South Africa and New Zealand.
"We won the game, scored five tries and defended pretty well. The guys in the back three played very well so we are in a pretty good place and looking forward to next week," Johnson said of the game against a Wallaby side who beat Italy 30-20.
"The guys know it's going to be a step up against a team who have played together in the Tri-Nations and will be better organised than the Islanders, who only had a week together.
There were certainly plenty of encouraging signs for Johnson on Saturday, not least the assured display of his four starting debutants.
Athletic lock Nick Kennedy, brought in specifically for his lineout skills as England seek to win more first-phase ball after the clampdown on refereeing of the breakdown, did just that and also weighed in with a try.
Wing Ugo Monye was razor-fast in attack and solid in defence against the hefty Islanders while Riki Flutey looked at home at inside centre.
However, the player who most caught the eye was fullback Delon Armitage, with a man-of-the-match performance that prompted Johnson to say he had never seen a better debut.
Assured under the high ball and in the tackle he was also dangerous in attack and showed great awareness to loop an inside pass to Paul Sackey for the first of the winger's two tries.
"He's got his reward for persisting at club level. He's been on the money all week and did very well," said England attack coach and Armitage's former coach at London Irish Brian Smith.
With nine players having worn the number 15 shirt in 18 months, Armitage now has the chance to nail down the position.
"I always wanted to play for England and show what I can do in front of a big crowd," said the 24-year-old.
"I'm just upset the game went so quickly. There were about 20 members of my family in the East Stand today -- I think it's a day they'll never forget either.
Danny Care delivered an assured performance at scrumhalf and, although he did give a try away when a clearing kick was charged down, flyhalf Danny Cipriani made amends with a try and a sharp showing as the two 21-year-olds played the first game of what Johnson hopes will be a long and fruitful partnership.
The less positive side of Saturday's display came with the scrum, which was generally a mess all afternoon on the slippery surface, and in a long, meandering spell in the second half when the Islanders controlled the ball.
Johnson, pragmatic as ever, said: "I've told them to enjoy the win but there is lots to talk about and lots to work on against Australia."
(Editing by John Mehaffey)


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1 comment:

michael said...

nice collection