Obama asks for short-term budget plan to delay across-the-board automatic cuts
WASHINGTON (AP) -- President Barack Obama is asking Congress for a short-term deficit reduction package of spending cuts and tax revenue that will delay the effective date of steeper automatic cuts now scheduled to kick in on March 1. Obama said the looming cuts would be economically damaging and must be avoided.
The president reiterated his insistence on long-term deficit reduction that combines taxes and cuts, a blend that faces stiff resistance from anti-tax Republicans in Congress.
Obama made his case Tuesday afternoon in the White House briefing room, just minutes after the Congressional Budget Office released revised budget projections that showed the deficit will drop to $845 billion this year, the first time during Obama’s presidency that the red ink would fall below $1 trillion. The budget office also said the economy will grow slowly in 2013, hindered by a tax increase enacted in January and by the automatic spending cuts scheduled to take effect this spring.
It is those cuts that Obama is seeking to put off with less onerous measures. Neither the president nor White House aides specified what those measures should be.
"There’s no reason that the jobs of thousands of American who work in national security or education or clean energy, not to mention the growth of the entire economy, should be put in jeopardy just because folks in Washington couldn’t come together to eliminate a few special interest tax loopholes or government programs that we agree need some reform," he said.
boy held hostage seems
OK despite horror
MIDLAND CITY, Ala. (AP) -- By all accounts, a 5-year-old in Alabama endured an unforgettable horror: Held for a week in a closet-size bunker underground, a captive of a volatile killer, his only comforts a Hot Wheels car and other treats passed to him by officers.
Yet after being whisked to safety by federal agents in a raid that left his kidnapper dead, the boy appeared to be acting like a normal kid: He was running around, playing with a toy dinosaur and other action figures, eating a turkey sandwich and watching "SpongeBob SquarePants," relatives and Dale County Sheriff Wally Olson said.
"We know he’s OK physically, but we don’t know how he is mentally," Betty Jean Ransbottom, the boy’s grandmother, told The Associated Press on Tuesday. She added that she feared the ordeal would stay with the child, who turns 6 on Wednesday, the rest of his life.
Meanwhile, authorities grateful for a happy ending embarked on a careful investigation. Agents swept the 100-acre property for explosives for a second day as part of an investigation so painstaking that authorities had not yet removed the body of the abductor, 65-year-old Jimmy Lee Dykes, officials said.
Documents: Superdome officials worried about power outage, spent thousands on upgrades
NEW ORLEANS (AP) -- Concerned the Superdome might not be able to handle the energy needed for its first Super Bowl since Hurricane Katrina, officials spent hundreds of thousands of dollars on upgrades to decayed utility lines, according to documents obtained by The Associated Press. The improvements apparently weren’t enough, however, to prevent an embarrassing and puzzling 34-minute power outage during the third quarter of the game between the Baltimore Ravens and San Francisco 49ers on Sunday.
Two days later, officials still had not pinpointed the cause of the outage. The Superdome’s management company, SMG, and the utility that supplies the stadium, Entergy New Orleans, announced Tuesday that they would hire outside experts to investigate.
"We wanted to leave no stone unturned," Entergy spokesman Chanel Lagarde told the AP. He said the two companies had not been able to reach a conclusion on the cause and wanted a third-party analysis.
"We thought it was important to get another party looking at this to make sure we were looking at everything that we need to examine," Lagarde said.
U.S. lawsuit casts blame
for financial crisis on Standard & Poor’s
WASHINGTON (AP) -- The U.S.government says Standard & Poor’s knowingly inflated its ratings on risky mortgage investments that helped trigger the 2008 financial crisis.
The credit rating agency gave high marks to mortgage-backed securities because it wanted to earn more business from the banks that issued the investments, the Justice Department alleges in civil charges filed in federal court in Los Angeles.
The government is demanding that S&P to pay at least $5 billion in penalties.
The case is the government’s first major action against one of the credit rating agencies that stamped their approval on Wall Street’s soon-to-implode mortgage bundles. It marks a milestone for the Justice Department, which has long been criticized for failing to act aggressively against the companies that contributed to the crisis.
S&P, a unit of New York-based McGraw-Hill Cos., called the lawsuit "meritless."
Justice memo details broad grounds for drone strikes against Qaida-linked U.S. citizens abroad
WASHINGTON (AP) -- An unclassified Justice Department memo reveals that the Obama administration has had more lenient rules than publicly known for when drone attacks can be launched to kill U.S. citizens working abroad with terrorists.
The government does not need evidence that a specific attack is imminent, the newly disclosed Justice Department white paper says, only that the targeted suspect is involved in ongoing plotting against the United States.
"The threat posed by al-Qaida and its associated forces demands a broader concept of imminence in judging when a person continually planning terror attacks presents an imminent threat," the document says.
The undated document surfaced as Obama administration official John Brennan, who helped manage the drone program, heads to Capitol Hill on Thursday for his confirmation hearing to become CIA director. The hearing will take place as a growing number of senators are asking to see a still-classified Justice Department legal opinion that justifies the administration’s position on drones and is binding on the entire executive branch.
White House press secretary Jay Carney declined Tuesday to discuss details, saying only that President Barack Obama takes seriously his responsibility to protect the United States and its citizens from al-Qaida terrorists.
Bulgaria links Hezbollah
to bus attack that killed Israelis; suspects from Canada, Australia
SOFIA, Bulgaria (AP) -- Hezbollah was behind a bus attack that killed five Israeli tourists in Bulgaria last year, investigators said Tuesday, describing a sophisticated bombing carried out by a terrorist cell that included Canadian and Australian citizens.
The first major announcement in the investigation carried broad diplomatic implications, as countries that consider the Shiite militant group to be a terrorist organization called on Europe -- which has resisted such a move -- to crack down on the group.
Interior Minister Tsvetan Tsvetanov said two of the suspects had been living in Lebanon for years -- one with a Canadian passport and the other with an Australian one. He said investigators had traced their activities back to their home countries.
"We have well-grounded reasons to suggest that the two were members of the militant wing of Hezbollah," Tsvetanov said after a meeting of Bulgaria’s National Security Council.
A third suspect entered Bulgaria with them on June 28, he said, without giving details.
Egypt’s president welcomes Iran’s Ahmadinejad, but tensions show through
CAIRO (AP) -- Iranian President Mahmoud Ahmadinejad discussed the crisis in Syria with his Egyptian counterpart Tuesday in the first visit by an Iranian leader to Cairo in more than three decades, marking a historic departure from years of frigid ties between the regional heavyweights.
Ahmadinejad’s three-day visit, which is centered around an Islamic summit, is the latest sign of efforts by Egypt’s Islamist President Mohammed Morsi to improve relations, which have been cut since Iran’s 1979 revolution.
Morsi’s flirtation with Iran is seen as aiming to strike an independent foreign policy and broaden Egypt’s connections after the ouster two years ago of longtime leader Hosni Mubarak, who kept close to the line of the United States. Such a visit by an Iranian leader would have been unthinkable under Mubarak, who was a close ally of the U.S. and shared Washington’s deep suspicions of Tehran.
But the limits to how far Morsi can go were on display during Tuesday’s visit. There are deep suspicions in overwhelmingly Sunni Muslim Egypt toward Iran and its Shiite clergy leadership. Also, Morsi’s government was quick to reassure Arab Gulf nations, which are bitter rivals of Tehran and are concerned over the spread of its influence, that Egypt is intent on their security.
Sunni-Shiite tensions dominated talks Ahmadinejad held with Egypt’s most prominent cleric, Sheik Ahmed el-Tayeb, who heads the Sunni world’s most prestigious religious institution, Al-Azhar.
Dell sells itself to founder, buyout firm in $24.4B deal driven by industry slump
SAN FRANCISCO (AP) -- Slumping personal computer maker Dell is bowing out of the stock market in a $24.4 billion buyout that represents the largest deal of its kind since the Great Recession dried up the financing for such risky maneuvers.
The complex agreement announced Tuesday will allow Dell Inc.’s management, including eponymous founder Michael Dell, to attempt a company turnaround away from the glare and financial pressures of Wall Street.
Dell stockholders will be paid $13.65 per share to leave the company on its own. That’s 25 percent more than the stock’s price of $10.88 before word of the buyout talks trickled out three weeks ago. But it’s a steep markdown from the shares’ price of $24 six years ago when Michael Dell returned for a second go-round as CEO.
Dell shares rose 14 cents to $13.41 in afternoon trading, indicating that investors don’t believe a better offer is likely.
The chances of a successful counter offer look slim, given the forces lined up behind the current deal. Mexico official: gas from hot-water system may have caused blast that killed 37
MEXICO CITY (AP) -- A water-heating system may have leaked gas into a tunnel beneath the headquarters of Mexico’s national oil company for more than seven months before it was accidentally detonated by a maintenance crew’s improvised lighting system, officials said Tuesday, adding fresh detail to the narrative of the petroleum giant’s worst disaster in a decade.
Mexico’s attorney general said Monday night that a gas buildup was responsible for the explosion that collapsed three floors of the administrative building in Petroleos Mexicanos’ Mexico City headquarters complex, killing 37 people. He indicated the gas could have been methane, a gas that is both processed for use in heating systems and naturally produced by the decomposition of organic matter in sewers and landfills.
Assistant Attorney General Alfredo Castillo told reporters Tuesday morning that one source of the gas may have been a tunnel that ran from a heating plant and beneath the devastated building on its way to the 54-story central tower of the complex. He said that explanation appeared likely because the blast blew off manhole covers providing access to the tunnel some distance from the affected building.
"There’s a connection to, as you’ve seen, a place where there are gas facilities," Castillo said. "These manhole covers were found completely blown off."
Attorney General Jesus Murillo Karam told Radio Formula Tuesday afternoon that the gas may have come through a pipe that connected to what he called a room containing machinery. He said it also may have been produced by wastewater and collected under the building.