South Africa Struggles to Provide Jobs, Report Says

Abstract: JOHANNESBURG — Facing sluggish economic growth and a yawning gap between the nation’s richest and poorest citizens, South Africa is struggling to provide jobs for hundreds of thousands of workers, the World Bank said in a report released Tuesday . The report came a day after South Africa’s finance minister, Pravin Gordhan, announced that the country was unlikely to meet its 2.7 percent growth projection amid the global slowdown. The World Bank said South Africa was likely to grow 2.5 percent this year. The report, which focused mainly on the roots and persistence of inequality in South Africa, said that since apartheid ended in 1994, “growth has also been highly uneven in its distribution, perpetuating inequality and exclusion,” and that “at the heart of high inequality lies the inability to create employment opportunities on a large enough scale.” The unemployment rate is officially 25 percent, but it is much higher among young black people. The lack of jobs, coupled with a failure to transform failing schools in areas that serve mainly black and mixed-race children, has limited social mobility for many South African children, the report said. “Our results show that a South African child not only has to work harder to overcome the disadvantages at birth due to circumstances, but having done so, finds that these re-emerge when seeking employment as an adult,” Sandeep Mahajan, the World Bank’s lead economist in South Africa, said in a statement. “Moreover, the disadvantages do not stop with that one person — they get transmitted across generations. The policy challenge is to find a way to break this vicious, self-perpetuating cycle of inequality in South Africa.” At its recent policy conference to decide on party positions, the governing African National Congress held heated debates about how to tackle inequality, considering radical proposals like nationalizing the country’s mines and seizing land without compensation for redistribution to the poor. President Jacob Zuma deplored the fact that “the economic power relations of the apartheid era have in the main remained intact.” “The ownership of the economy is still primarily in the hands of white males, as it has always been,” Mr. Zuma said. No decisions were made, but the proposals will be discussed again when the party meets in December to choose its next leader. South Africa’s sluggish growth defies regional trends. Sub-Saharan Africa includes some of the world’s fastest growing economies. Europe is South Africa’s biggest trading partner, so the Continent’s debt troubles have hit manufacturing and other industries here hard, as has slowing growth in China.

South Africa
Economic Conditions and Trends
Labor and Jobs
World Bank
African National Congress


Defying Others, Germany Finds Economic Success

Abstract: BERLIN — Germany has sparred with its European partners over how to respond to the financial crisis, argued with the United States over the benefits of stimulus versus austerity, and defiantly pursued its own vision of how to keep its economy strong. Statistics released Friday buttress Germany’s view that it had the formula right all along. The government on Friday announced quarter-on-quarter economic growth of 2.2 percent, Germany’s best performance since reunification 20 years ago — and equivalent to a nearly 9 percent annual rate if growth were that robust all year. The strong growth figures will also bolster the conviction here that German workers and companies in recent years made the short-term sacrifices necessary for long-term success that Germany’s European partners did not. And it will reinforce the widespread conviction among policy makers that they handled the financial crisis and the painful recession that followed it far better than the United States, which, they never hesitate to remind, brought the world into this crisis. A vast expansion of a program paying to keep workers employed, rather than dealing with them once they lost their jobs, was the most direct step taken in the heat of the crisis. But the roots of Germany’s export-driven success reach back to the painful restructuring under the previous government of Chancellor Gerhard Schröder. By paring unemployment benefits, easing rules for hiring and firing, and management and labor’s working together to keep a lid on wages, Germany ensured that it could again export its way to growth with competitive, nimble companies producing the cars and machine tools the world’s economies — emerging and developed alike — demanded. Germans steered clear of the debt-fueled consumption boom that many believe contributed to the financial crisis. During the recession, Chancellor Angela Merkel resisted the palliative of government spending that the United States and some European partners felt was crucial to restoring growth. The battle over how to navigate the financial crisis helps display Germany’s emerging post-cold-war identity as a country less tolerant of foreign demands and lecturing, one with a tenser relationship with European partners. Though Germany has plenty of problems to grapple with at home, it has also become less obsessed with its historical crimes and more enthusiastic about its economic model, its culture and its improved standing in the world. Jenny Wiblishauser, 33, a single mother in the southern town of Memmingen, said Germany’s financial prudence — and its willingness to ignore foreign criticism — made her proud. “Before, the Greeks would call us Nazis, and we would act vulnerable,” she said. “Now one says, ‘Well, I’m not driving there for vacation.’ ” Some critics in Europe say that confidence veered toward hubris in the contentious debate this year over shoring up the Greek government and restoring confidence in the troubled euro. In particular, the venomous contempt in the German news media directed at Greece raised significant concerns among allies that a more assertive Germany had emerged, said Thomas Klau, an expert on European integration at the European Council on Foreign Relations . “That was like a wake-up call to the rest of Europe that something had changed in Germany,” Mr. Klau said. In the process, the relationship between France and Germany has become fraught and mistrustful , calling into question the future of the project of European integration. As the latest numbers show, Germany is outproducing its neighbors by wider and wider margins, raising fears of a two-speed Europe that could render the common regional currency unstable. France’s economy grew at just a small fraction of Germany’s, 0.6 percent in the second quarter. Spain’s economy grew an anemic 0.2 percent, while Greece’s shrank 1.5 percent. If policy makers in Berlin are right and the turning point has been reached, they will look wise. If the fragile recovery cracks, as worrisome signs of a slowdown in the United States and a cooling down of Chinese growth may augur, they could still bear the brunt of the blame for doing too little to foster regional and global growth. Government officials here are confident they found the right approach, including a better solution to unemployment. They extended the “Kurzarbeit” or “short work” program to encourage companies to furlough workers or give them fewer hours instead of firing them, making up lost wages out of a fund filled in good times through payroll deductions and company contributions. At its peak in May 2009, roughly 1.5 million workers were enrolled in the program. The Organization for Economic Cooperation and Development recently estimated that by the third quarter of 2009, more than 200,000 jobs may have been saved as a result. The German economy’s comeback is visible in smaller towns like Memmingen, in the historic region known as Swabia. The brightly painted market square in this prosperous town is straight out of a German fairy tale, but it is beyond the medieval fortifications of the old town that Memmingen’s part in the nationwide rebound of employment, which Chancellor Merkel has likened to a “small miracle,” took place. After a record year in 2008, the family-owned firm Magnet-Schultz watched orders for its electromagnetic products plunge. Nearly one-third of the company’s more than 1,500 workers in Germany were put on the short-work program. Only 57 were laid off. The firm’s chairman, Wolfgang E. Schultz, whose grandfather founded the firm nearly 100 years ago and whose son Albert joined as a vice president in January, said that his goal was to maintain the company in the long term by losing as few skilled workers as possible. He promised to try to rehire those who were let go when times improved. Forty of those workers have been rehired already. German exports rose in June by 28.5 percent compared with the year before, the highest level since the financial crisis began to pinch in October 2008. The renewed boom for industrial companies like Magnet-Schultz has helped push the unemployment rate down to 3.4 percent in Memmingen, less than half the national average of 7.6 percent. “The government took the right steps in extending the short-work program because it bridged a difficult situation,” Mr. Schultz said in an interview. From the start of the financial crisis, Mrs. Merkel has been the leading advocate of fiscal austerity, a view that won out at the Group of 20 meeting in Toronto in June when the leaders of the world’s biggest economies promised to reduce their budget deficits. Despite Mrs. Merkel’s triumphs on the world stage, her government is struggling to reverse its plummeting approval ratings . Her stance reflects the will of a public that, despite the good economic news, remains stubbornly worried about the future. The very sacrifices that have made German products more competitive and helped the country outpace its weaker, less disciplined European partners — strict wage control, a retirement age rising to 67 from 65, lower welfare payments and eased hiring and firing — have resulted in a deep feeling of insecurity. Ms. Wiblishauser, the single mother in Memmingen, spent one month in 2006 on the scaled-back welfare program known as Hartz IV. Although working as an assistant tax consultant now, she said slipping back onto the rolls was her greatest source of dread. “It gives you an existential fear,” she said. Germany’s partners have cajoled, begged and demanded that the government in Berlin encourage more robust consumer spending, to combat imbalances among the countries that use the euro currency. But Ms. Wiblishauser said she found the prospect of spending to aid other European countries distasteful. Like many Germans, Ms. Wiblishauser said she was having a hard time seeing the benefits the country received from being a member of the European Union. “I would really like it if we were self-sufficient, like the Swiss,” she said.

Germany
Economic Conditions and Trends
Merkel Angela
Labor and Jobs
International Trade and World Market


Extradited Colombian to Face Charges of Drug Trafficking

Abstract: A Colombian who has been described by his country’s president as “the last of the great kingpins” was extradited to the United States from Colombia on Tuesday to face charges that he manufactured large quantities of cocaine that he then trafficked to the United States and elsewhere. The Colombian, Daniel Barrera, is to be arraigned in the federal district courts in Manhattan and Brooklyn on Wednesday and Thursday, where he faces separate indictments. After those prosecutions, he will be arraigned in Miami on additional charges, the authorities said. Mr. Barrera, also known as El Loco, was arrested in September in Venezuela as a result of a complex operation that included the Colombian and Venezuelan authorities, the Central Intelligence Agency, the Drug Enforcement Administration and the British intelligence. He was later sent to Colombia, and his extradition was announced by the United States attorneys in the three jurisdictions and other officials, including Raymond W. Kelly, the police commissioner of New York; and Michele M. Leonhart, the head of the D.E.A. An indictment in Manhattan says that Mr. Barrera relied on two Colombian terrorist organizations to carry out his operations, buying raw cocaine paste from members of the Revolutionary Armed Forces of Colombia, or FARC, and processing it in laboratories in areas controlled by another group, to which he paid fees. Mr. Barrera’s organization produced upward of 400 tons of cocaine a year, “enriching itself and the two terrorist organizations it paid off,” said Preet Bharara, the United States attorney in Manhattan. Loretta E. Lynch, the United States attorney in Brooklyn, said Mr. Barrera’s organization was “marked by its worldwide reach, ruthless criminality and staggering profits.” Mr. Barrera is charged in Manhattan with one count of narcotics importation conspiracy, which carries a maximum sentence of life in prison. He faces a money laundering conspiracy charge in Brooklyn. His lawyer declined to comment. Officials have said that Mr. Barrera, while residing in Venezuela, changed his appearance through plastic surgery, slept in different places and burned his fingertips to try to make it impossible to identify him.

Colombia
Daniel Barrera
Drug Abuse
Extradition


Final Push in Race to Finish Giffords’s House Term

Abstract: TUCSON — The contest to fill the Congressional seat vacated by Gabrielle Giffords , the Democrat who survived an assassination attempt last year, has been widely referred to as the race for “Gabby’s seat.” Her chosen successor, Ron Barber , has tried to step out from her shadow, though, saying at campaign events and in interviews that the race is, in fact, for “the people’s seat.” Still, at Mr. Barber’s last big rally on Saturday, Ms. Giffords figured as the guest of honor and the main attraction. She stepped onto the stage to boisterous cheers — with her right arm in a brace, a slight limp and a big smile on her face. Her husband, Capt. Mark E. Kelly, a retired astronaut, did the talking for her, saying Mr. Barber was “the person who she knew could represent this community the way she did.” The election is “more than an ordinary election,” he said, and is about “closure for Gabby’s career in Congress.” On her way out, Ms. Giffords waved and said, “Thank you, thank you very much,” her only words to the crowd but enough to bring some people to tears. The Barber rally — a call to arms for volunteers to help the final get-out-the-vote push before the election on Tuesday — had the feel of a victory party. Red, white and blue balloons adorned the stage at the historic Rialto Theater here, where four bands serenaded parents and children, activists circulated petitions to protect financing for state parks and college students dressed for a night out. Meanwhile, Mr. Barber’s Republican opponent, Jesse Kelly, a businessman and Marine Corps veteran, spent the day engaged in old-school politicking, urging voters to go to the polls in telephone calls and home visits. He also mobilized a team to pick up absentee ballots from those who had not yet mailed them in. “Every vote is going to matter,” Mr. Kelly’s campaign spokesman, John Ellinwood, said in an interview. Mr. Barber, 66, and Mr. Kelly, 30, are locked in a tight race in a swing district that in the same year voted to re-elect as governor Janet Napolitano, a Democrat, and Senator Jon Kyl, a conservative Republican. Republicans make up a majority of registered voters in the district, but independents, about 30 percent of the electorate, are a decisive constituency. The winner of Tuesday’s election will serve the roughly six months left in Ms. Giffords’s third term representing Arizona’s Eighth Congressional District; she resigned in January to focus on her recovery. Ms. Giffords was shot in the head during a meeting with constituents outside a supermarket here on Jan. 8 last year. Six people were killed and 12 others were wounded, among them Mr. Barber, who was one of her top aides. Regardless of the results, Mr. Barber and Mr. Kelly have both said they would compete this fall for a full term in a newly created Congressional district where voters are more evenly distributed between Republicans and Democrats.

Giffords Gabrielle
Barber Ron
Kelly Jesse
Elections
House of Representatives
Arizona


Brooklyn Rod and Gun, an Urban Haven for Anglers

Abstract: SOMETHING is clearly going on behind that modest blue door near the East River waterfront in Williamsburg, Brooklyn. Burlap sacks cover the windows, but music and laughter spill out. Strolling by, you might mistake it for a cozy house party. But wander in and you will discover an old-timey dude’s world called Brooklyn Rod and Gun, a fishing club that welcomes anyone willing to follow a few simple rules: “No booze in. No booze out. Throw your peanut shells on the floor.” Black waders dangle from a coat rack, a four-foot bass sprawls across a wall, and dim lamps illuminate a long wooden worktable where members commune over fly-tying and American roots music. “I’ve lived in this neighborhood since the 1980s, when there were a lot of Polish and Italian social clubs, and I was always inspired by that idea of creating your own community center,” said Chris Raymond, 48, a fly-fishing enthusiast and the information-technology director for Abrams Books. His signature accessory is a worn red baseball cap stitched with the words “Fish Pimp.” So two years ago, when he was between jobs, Mr. Raymond organized a weekly hangout with 11 other mostly unemployed, musically inclined fathers in a two-story, 800-square-foot former warehouse they rented on an industrial stretch of Kent Avenue near North 11th Street. The agenda? Listening to records, drinking beer and talking about the great outdoors. They built their own furniture and tacked up fishing maps of the Catskills and Newtown Creek. They jammed on their guitars or headed to the ragged shore nearby to catch moss bunker and bluefish. Curious passers-by and friends of friends started dropping in. Now there are 80 members, and events almost every night of the week: hootenannies on Sundays, fly-tying tutorials on Mondays, secret-cinema night on Tuesdays and a rotating cast of small bands with names like the Buddy Hollers and the Calamity Janes on Thursdays, Fridays and Saturdays. Events are listed, along with photos of past outings, on bklynrodandgun.com , the club’s Web site. Members pay $100 to join, but anyone can get in for $10 a night. Though the crowd is predominantly male, women, families and even pets mix in. And despite the “gun” in its name, the group has not arranged any shooting events. One member, Dewey Thompson, 50, described the club as a “real piece of hangout,” supplemented by the occasional boating trip, upstate hike or summer campout at an outdoor garden shop next door. The gatherings feel a bit like family reunions. The standard greeting is a fierce handshake or hug, and every once in a while somebody pulls up with a car trunk full of fresh fish and oysters for the grill on the sidewalk out front. “There’s a real kinship and camaraderie I haven’t found where I live,” said Bob Kowalski, 46, who comes to the club three times a week from Newtown, Conn., about 80 miles away. “The other night, I was here until 3 a.m. I drove home, then turned around and came back the next evening.” On a recent Friday night, Mr. Kowalski sat with his friend Walter Sipser, 49, in the loft space over the club’s main room, trying to get a poker game off the ground. They poured glasses of whiskey and cracked cans of beer to the twang of a banjo played by a bearded man below. Somebody propped open the door to the club, and pedestrians outside slowed their pace to listen. A few clapped to the bluegrass beat. “Yes, this is a clubhouse, but it’s a very welcome one,” Mr. Sipser said. “We’re always like: ‘Come on in! Come hang out.’ ”

Fishing Commercial
Hunting and Trapping
Organizations Societies and Clubs
Williamsburg (NYC)


Another Leader Quits Post in Syrian Exile Group

Abstract: BEIRUT, Lebanon — The main Syrian exile opposition group suffered new turbulence at the top on Monday, when the prime minister of its still-notional interim government resigned. The resignation came two days after the opposition group elected a new president as it tries to unify and arm the rebels fighting the government of President Bashar al-Assad and to help civilians in rebel-held areas of Syria. The prime minister, Ghassan Hitto, was appointed in March to assemble an administration that would govern rebel-held territory. It was not immediately clear why he resigned. But the opposition’s efforts to establish that administration and a unified military command, and to obtain greater military support from the West, remain nascent at best. The United States and its allies have pledged to increase aid, but so far there has been little apparent impact, and members of the coalition have complained that it is hard to make progress when the West is not fully committed to helping them. “The circumstances which have become known to all did not allow me to initiate work on the ground,” Mr. Hitto said in a statement on the group’s Facebook page announcing his resignation. Mr. Hitto had taken a hard line against holding any talks with the Assad government, a stance that posed difficulties as the United States and Russia tried to organize peace talks in Geneva. Mr. Hitto was chosen after some members of the exile group, the National Coalition for Syrian Revolutionary and Opposition Forces, had criticized the coalition’s president, the Damascus religious scholar Moaz al-Khatib, for floating the idea of negotiating with elements of the government. The group’s new president, Ahmad Assi al-Jarba, also expressed skepticism about talks in his first public statements on Sunday, declaring that the coalition would not attend the Geneva talks unless its military position improved first. Mr. Hitto, a naturalized American citizen from Damascus who lived in Texas for years, was seen by American officials as a capable technocrat. He helped manage the exile group's humanitarian aid effort, visited rebel-held areas several times and urged his colleagues in the opposition group to visit as well. But he faced several challenges: despite the visits, he was seen by some rebels and activists as out of touch with the country, and some members of the often-squabbling coalition complained that he was a favorite of the Syrian Muslim Brotherhood and of its main foreign backer, Qatar. Many in the Syrian opposition say Qatar wields too much influence in the movement. Mr. Jarba, who is seen as close to Saudi Arabia, a rival of Qatar for influence among the rebels, was seen as a counterweight to Mr. Hitto and his Muslim Brotherhood backers. Image Prime minister Ghassan Hitto was appointed in March. Credit Karim Sahib/Agence France-Presse — Getty Images He has been busy in the first few days of his tenure, visiting several rebel-held towns inside Syria, announcing that the rebels will soon get a new shipment of sophisticated weapons from Saudi Arabia, and calling for a truce during the holy month of Ramadan, which begins this week. The truce proposal appeared intended to allow aid to reach besieged rebel-held neighborhoods in Homs, in the center of the country, where government forces are pressing an offensive. Yet Mr. Jarba holds few cards to pressure his foes, as he made clear in one of his first statements after being elected on Saturday. He said that the opposition would not attend the proposed peace talks if its forces continued losing ground. “Geneva in these circumstances is not possible,” Mr. Jarba told Reuters on Sunday. “If we are going to go to Geneva, we have to be strong on the ground, unlike the situation now, which is weak.” He spoke after a trip to Idlib Province, where he met with leaders of rebel forces and discussed the situation in Homs. “I will not rest until I procure the advanced weapons needed to hit back at Assad and his allies,” he told Reuters. “I give myself one month to achieve what I am intent to do.” Mr. Jarba, 44, who holds a law degree from the Arab University of Beirut and was once a political prisoner, was elected to his office by a narrow margin in a vote among the coalition members, defeating a Brotherhood-backed candidate, Mustafa Sabbagh, a businessman. He belongs to a prominent Arab tribe that extends beyond Syria. He issued a plea for help for the city of Homs, which has been blockaded and bombarded for more than a year, including a withering new air, artillery and ground assault that began in late June. “We are staring at a real humanitarian disaster in Homs,” Mr. Jarba told Reuters on Sunday. Government forces have been trying to capitalize on several recent advances in Homs to regain control of central parts of the city that were in rebel hands. Some rebels say the government troops are being supported by fighters from the Shiite Lebanese militant group Hezbollah, as they were in the recent battle in the nearby border town of Qusayr. Mr. Jarba’s call for a truce came after two-thirds of the city’s Khalidiya neighborhood was reduced to rubble, according to the Syrian Observatory for Human Rights, a Britain-based antigovernment watchdog group that tracks the fighting through a network of activists in Syria. “Of all Syria’s cities, Homs has suffered the highest levels of destruction,” the group’s director, Rami Abdel Rahman, told Agence France-Presse. “Much of it has been flattened.” The government says that it is fighting to clear the city of terrorists and foreign fighters, and that it has succeeded in advancing into parts of Khalidiya.

National Coalition of Syrian Revolutionary and Opposition Forces


Tampa Bay Buccaneers vs. Tennessee Titans Matchup

Abstract: Titans at Buccaneers 4:25 p.m. Line: Buccaneers by 3 This game will be hyped as the matchup of the Heisman Trophy winners Marcus Mariota of the Titans and Jameis Winston of the Buccaneers, but both teams have been bad enough in recent years that expecting much from rookie quarterbacks is unrealistic. Mariota looked sharper in the preseason, but his team’s defense was among the worst last season, and a Tampa Bay receiving corps that includes Mike Evans and Vincent Jackson should be enough to let Winston avenge the lone loss of his college career. PICK: BUCCANEERS


2 Lions, Their Birth Hailed by Gaza, Die Within Days

Abstract: GAZA — The military wing of Hamas, the Islamic group that controls Gaza, hailed the birth of two lion cubs at a zoo here this week as a triumph over the proverbial hardships of life in this Palestinian coastal enclave. But the jubilation was short-lived. The cubs, whose parents were smuggled through underground tunnels from Egypt, died Thursday in the Hamas-run Bissan Zoo in Beit Lahiya, a town in northern Gaza. The cubs, Fajr, a male, and Sijil, a female, became symbols of resistance as soon as they were named. Fajr, Arabic for dawn, is a reference to the long-range rockets that Hamas has fired into Israel; Sijil, which means stones of clay, is the name Hamas gave to the cross-border conflict with Israel. “A symbol of beauty, power and strength recently born in the besieged #Gaza Strip,” the Izzedine al-Qassam Brigades, the military wing of Hamas, said on Twitter on Tuesday, a day after the births. Zoo officials gave several possible reasons the baby lions — said to be the first to have been born in the often gritty conditions of Gaza — failed to survive. First, their mother, an African lioness smuggled in along with the father in 2008, refused to feed the cubs. Instead, the zookeepers bottle-fed them regular milk. Then on Tuesday an Israeli warplane dropped three bombs on an Islamic Jihad training base in northern Gaza, not far from the zoo, causing the lioness to panic and step on her offspring, according to Nasim Abu Safia, 29, who is in charge of feeding the animals at the zoo. The Israeli military said it had struck several sites in Gaza in retaliation for rocket fire aimed at soldiers near the border earlier that day. Finally, Mr. Safia said, the cubs could not stand the November chill, and the zoo did not have the facilities to properly shelter them. “We tried as much as possible to save their lives and keep them alive,” he said, “but it was out of our hands and beyond our capabilities.” The cubs were born healthy, Mr. Safia said, each weighing about 3.5 pounds. He added that it was their mother’s first litter. There are about a dozen private or Hamas-run zoos in the Gaza Strip. At one, workers reportedly once tried to transform two donkeys into zebras by applying stripes of hair dye. In another zoo in the southern town of Rafah along the Egyptian border, dead animals have been stuffed and put on display.


Steady Rangers Ready for Up-and-Down Bruins

Abstract: Brandon Dubinsky’s positive response to a benching — a tying goal late in regulation in the Rangers ’ 4-3 overtime loss Friday night at Tampa Bay — is the latest example of the contrast in late-season approaches by the Rangers and the Boston Bruins . As the teams head into their game Sunday afternoon at Madison Square Garden, Bruins Coach Claude Julien has been patient with his defending Stanley Cup champions, while Rangers Coach John Tortorella relentlessly pushes buttons. Tortorella has been getting results. On Jan. 21, the Rangers beat the Bruins, 4-3, on a goal by Marian Gaborik with four seconds left in overtime. Since then, the Rangers are 11-3-3. After losing, 3-2, to the Islanders on Saturday, the Bruins have gone 8-9-1 and trail the Rangers by 10 points in the Eastern Conference. Before the Jan. 21 game, the Rangers led the East with 62 points in 45 games, and the Bruins were second with 61 points in 44 games. Tortorella deserves credit for refusing to let his team get sloppy. Most coaches do not use words like stupid and dumb in news conferences after victories, but those were the words Tortorella used to describe a penalty by Dubinsky in the Rangers’ 3-2 win Thursday at Carolina. In the final minute of the first period, Dubinsky was entangled with Anthony Stewart of the Hurricanes in a goal-mouth scrum. As the pushing and shoving intensified, Dubinsky ripped the stick out of Stewart’s hands. Instead of dropping it, Dubinsky tossed it a few feet for dramatic effect. The referees gave Dubinsky a two-minute penalty for unsportsmanlike conduct, and Carolina’s Jeff Skinner scored on the power play early in the second period. Dubinsky skated to the Rangers’ bench after Skinner’s goal and did not play for the rest of the game. Tortorella told reporters that if another forward were available, he would have benched Dubinsky for Friday’s game against the Lightning. With the Rangers behind, 3-2, Dubinsky scored with 3 minutes 27 seconds left in regulation to send the game to overtime and give the Rangers (41-15-7) their 89th point of the season. “I’m happy with the way he answered,” Tortorella said of Dubinsky. “I hope he grows off that. I hope he continues with his discipline, because he needs to be a big part of this.” By addressing mistakes before they become bigger problems, the Rangers have managed to elude long losing streaks this season. Boston, which was tied for the second in the East with 79 points entering Saturday, has plenty of problems. Tim Thomas, the Bruins’ No. 1 goaltender and last season’s Vezina Trophy winner, had a .946 save percentage before the loss to the Rangers on Jan. 21. Since then, his save percentage in 13 games is .914, the envy of many keepers, but not up to Thomas’s standards. He lost four games in February, after losing five in November, December and January combined. His backup, Tuukka Rask, has played poorly. His save percentage over his last six games is .882. Key members from last season’s Cup team are out of the lineup. Forward Nathan Horton has been sidelined since sustaining a concussion in a game Jan. 22 in Philadelphia. Wing Rich Peverley has a sprained knee and is still a few weeks away from returning. The hard-hitting defenseman Johnny Boychuk missed two games with a concussion, but returned Saturday against the Islanders. General Manager Peter Chiarelli acquired forward Brian Rolston, 39, an hour before the trade deadline Monday. In 49 games with the Islanders, Rolston had only four goals and five assists, despite averaging more than 14 minutes a game. Chiarelli also picked up the veteran defenseman Mike Mottau in the deal with the Islanders for two fringe prospects. Serious eye, hip and groin injuries limited Mottau to 49 of a possible 142 games with the Islanders. Greg Zanon, a steady, stay-at-home defenseman, was added in a trade with Minnesota. But scoring goals has been the biggest struggle for the Bruins, who were shut out five times in February. Tyler Seguin had one goal in his previous 14 games and David Krejci scored once in 13 games before Julien played them on a line with Milan Lucic in Boston’s 4-3 overtime win over the Devils on Thursday. Krejci had three goals and Seguin had a goal and an assist. For the Bruins to contend, they need more consistent play. “It would be nice to win a few in a row,” Krejci said. “We’ve been kind of battling, one win and then one loss in the past month. We’ve got to get comfortable here in the room and try to get on a roll. This is a really important time of the season, and we’ve got to get in great shape before the playoff comes.” With a more balanced offense than the Bruins and superior goaltending, the Rangers became the first team in the N.H.L. this season to reach 20 wins on the road and at home. The players also believe their strong work ethic and commitment to physical play — at the level the Bruins demonstrated on their way to the Stanley Cup — are why the Rangers are in first place. “If you want to be in this lineup, that’s how you have to play,” Rangers forward Brian Boyle said. “Everyone holds each other accountable, and it’s a pretty well-oiled machine.”

New York Rangers
Boston Bruins
Hockey Ice
National Hockey League
Tortorella John
Julien Claude


Wal-Mart Pressed on How Global Suppliers Treat Workers

Abstract: Wal-Mart is facing new pressure to monitor and disclose how its international suppliers treat their workers. At its annual shareholder meeting on Friday, the New York City pension funds, which own a small percentage of shares in Wal-Mart, plan to ask the company to require vendors to publish annual reports detailing working conditions in their factories. Michael Garland, who oversees shareholder activism efforts as executive director for corporate governance at the city comptroller’s office, said the proposal was meant to improve workplace safety and worker rights at companies making goods for Wal-Mart, the world’s largest retailer. “No matter how much Wal-Mart and other companies are doing, or claim they are doing, to monitor their suppliers, they just don’t have the capacity to do it in a comprehensive way,” Mr. Garland said. “They put tremendous pressure on their suppliers to cut money out of the system,” which can lead to long hours, low pay or other problems. Wal-Mart opposes the request, citing the difficulty of persuading suppliers to issue reports. The company contends that even if it could enforce such a plan, to do so might threaten the availability of certain products from those who did not comply. While Mr. Garland acknowledged that the proposal was unlikely to succeed, he said casting a spotlight on the problem could prompt Wal-Mart to begin considering how to address its association with suppliers who did not treat workers fairly. Kalpona Akter, a Bangladeshi labor organizer who will present the proposal at the meeting in Fayetteville, Ark., complained that many of the Bangladesh factories that produced goods for Wal-Mart mistreated their workers. At Wal-Mart suppliers, “very often, first of all, the factory does not enforce the law” regarding minimum wages, she said. “Though the minimum salary has been cleared by the government, and many factories implemented that,” she said, “we haven’t seen any Wal-Mart suppliers giving a living wage to workers.” Though Wal-Mart sometimes sends auditors to check on working conditions, “when the auditor goes to the factory, the worker is coached by the management to tell lies in front of the auditors — that they are being paid living wages, that they are not being harassed,” she said. The proposal states that there is a “significant gap between general policies against labor and human rights abuse and more detailed standards and enforcement mechanisms required to carry them out.” It asks vendors to publish yearly reports that “include the supplier’s objective assessments and measurements of performance on workplace safety, and human and worker rights, using internationally recognized standards, indicators and measurement protocols.” “These problems, particularly with regard to labor and human-rights practices, are in the supply chain,” Mr. Garland said. “So even at companies that produce sustainability reports, like Wal-Mart, there’s an inability to get to the practices within the supply chain.” A Wal-Mart spokesman, David Tovar, said in an e-mail that for years Wal-Mart had maintained standards “that address the treatment of workers by suppliers and supplier workplace safety.” “We expect our suppliers to meet or exceed these standards. Our supplier standards are not merely goals that we encourage our suppliers to meet; rather, a supplier’s failure to adhere to these standards may jeopardize that supplier’s continued business relationship with Wal-Mart,” Mr. Tovar said. The New York City pension funds own about 5.7 million shares of Wal-Mart stock worth about $311 million. That gives them an ownership stake of less than 0.2 percent in Wal-Mart. Despite dim prospects for the proposal, Mr. Garland said he hoped it would provide an opening point for negotiations with Wal-Mart. In the past, when the pension funds have filed shareholder proposals at other companies, “when you file the proposal the company calls you up” and may adopt parts of what the proposal suggests. “The expectation here is we’re not going to get a majority vote,” he said. “It is an opportunity to make the case directly to the board. The expectation is you persuade the board that it’s the right thing to do for the company and for the shareholders.” Wal-Mart has been fighting the proposal since January, when it notified the Securities and Exchange Commission that it planned to strike the proposal from its proxy statement, and asked the S.E.C. not to penalize it for doing so. Wal-Mart wrote the S.E.C. saying it did not have contractual authority to require suppliers to publish the sustainability reports. In addition, using only those suppliers that issued these reports would require renegotiating thousands of agreements. In the environmental field, Wal-Mart has successfully created metrics for reducing packaging , and asked suppliers to change their practices in response, suggesting that creating new standards across the supply chain is feasible. In late March, the S.E.C. declined Wal-Mart’s request to strike the proposal. “Wal-Mart’s practices and policies do not compare favorably with the guidelines of the proposal,” wrote Rose A. Zukin, a lawyer for the S.E.C., and “it appears that the proposal may focus on the significant policy issues of sustainability and human rights.”

Human Rights and Human Rights Violations


Iceland’s Economy Is Mending Amid Europe’s Malaise

Abstract: REYKJAVIK, Iceland — For a country that four years ago plunged into a financial abyss so deep it all but shut down overnight, Iceland seems to be doing surprisingly well. It has repaid, early, many of the international loans that kept it afloat. Unemployment is hovering around 6 percent, and falling. And while much of Europe is struggling to pull itself out of the recessionary swamp, Iceland’s economy is expected to grow by 2.8 percent this year. “Everything has turned around,” said Adalheidur Hedinsdottir, who owns and runs the coffee chain Kaffitar , the Starbucks of Iceland, and has plans to open a new cafe and start a bakery business. “When we told the bank we wanted to make a new company, they said, ‘Do you want to borrow money?’ ” she went on. “We haven’t been hearing that for a while.” Analysts attribute the surprising turn of events to a combination of fortuitous decisions and good luck, and caution that the lessons of Iceland’s turnaround are not readily applicable to the larger and more complex economies of Europe. But during the crisis, the country did many things different from its European counterparts. It let its three largest banks fail, instead of bailing them out. It ensured that domestic depositors got their money back and gave debt relief to struggling homeowners and to businesses facing bankruptcy. “Taking down a company with positive cash flow but negative equity would in the given circumstances have a domino effect, causing otherwise sound companies to collapse,” said Thorolfur Matthiasson, an economics professor at the University of Iceland. “Forgiving debt under those circumstances can be profitable for the financial institutions and help the economy and reduce unemployment as well.” Iceland also had some advantages when it entered the crisis: relatively few government debts, a strong social safety net and a fluctuating currency whose rapid devaluation in 2008 caused pain for consumers but helped buoy the all-important export market. Government officials, who at the height of the crisis were reduced to begging for help from places like the Faroe Islands , are now cautiously bullish. “We’re in a very comfortable place because the government has been very stable in fiscal terms and is making good progress in balancing its books,” said Gudmundur Arnason, the Finance Ministry’s permanent secretary. “We are self-reliant and can borrow on our own without having to rely on the good will of our Nordic neighbors” or lenders like the International Monetary Fund. But not even Mr. Arnason says he believes that all is perfect. Inflation, which reached nearly 20 percent during the crisis, is still running at 5.4 percent, and even with the government’s relief programs, most of the country’s homeowners remain awash in debt, weighed down by inflation-indexed mortgages in which the principal, disastrously, rises with the inflation rate. Taxes are high. And with the country’s currency, the krona, worth between about 40 and 75 percent of its pre-2008 value, imports are punishingly expensive. Strict currency controls, imposed during the crisis, mean that Icelandic companies are forbidden to invest abroad. At the same time, foreigners are forbidden to take their money out of the country — a situation that has tied up foreign investments worth, according to various estimates, between $3.4 billion and $8 billion. “The capital controls are worse and worse for companies, but the fear is that if we lift them, the value of the krona will collapse,” Professor Matthiasson said. He said the only solution would be for Iceland to dispense with the krona and join a larger, more stable currency. The choices at the moment seem to be the euro, which is having its own difficulties, and the Canadian dollar. Not everyone buys into the rosy picture presented by officialdom. Jon Danielsson, an Icelander who teaches global finance at the London School of Economics, said that both the I.M.F., which bailed Iceland out during the crisis , and the government had a vested interest in painting a positive picture of the situation. “When I hear people say that everything is fine, it’s colored by P.R.,” Mr. Danielsson said. “They have clearly stabilized the economy and gotten out of the deep crisis, but they have not yet found a way to build a prosperous country for the future.” A visit to Iceland late last month revealed a far different place from the shellshocked nation of 2008. Stores and hotels were full. The Harpa, a glass-and-steel concert hall and conference center designed in part by the artist Olafur Eliasson and opened in 2011, soared over the Reykjavik skyline, next to a huge construction site that is to house a luxury waterside hotel. Employers said that instead of having to lay off workers, they were in some cases having trouble finding people to hire. Icelanders said that they had stopped feeling ashamed and isolated, the way that they did during the worst of the crisis, when their country was portrayed as a greedy and foolish pariah state and its British assets were frozen by the British government using the blunt and humiliating instrument of antiterror legislation. “We went through this complicated and terrible experience and were in the center of world events,” said Kristrun Heimisdottir, a lecturer in law and jurisprudence at the University of Akureyri in northern Iceland. She compared Iceland’s shame to that of a private person thrust onto the front pages by a lurid scandal. “It might take 20 years to recover from the stress and humiliation of having their personal life paraded before the world,” she said. “But it turned out that what happened to us was a microcosm of the whole crisis.” Some Icelanders say they have been soothed, too, by the country’s bold decision to initiate an extensive criminal investigation into the financial debacle. Many members of the old banking elite have been identified as possible suspects, and some of their cases are beginning to come to trial; several people were convicted of financial crimes last month. People in Reykjavik say that while things are hardly perfect, they are certainly better. “Everyone was scared, and we didn’t know what was going to happen,” said Kristjan Kristjansson, 49, manager of the store Bad Taste Records downtown. But Icelanders are adaptable people, he said, and many never really believed the economic boom was real, anyway. “Of course, what happened has affected everybody — our loans are higher, and it’s more expensive to live,” Mr. Kristjansson said. But there have been other financial crises before. “I remember when they cut two zeros off the Krona,” he said. “I’m old enough to have seen it go up and down.”

Iceland
Economic Conditions and Trends
European Sovereign Debt Crisis (2010- )


Romney Wins Most Wyoming Delegates

Abstract: CASPER, Wyo. — Mitt Romney , the former governor of Massachusetts who is locked in an intense primary battle in New Hampshire, captured the majority of Wyoming’s delegates to the Republican National Convention as the state’s Republicans met at county conventions. Mr. Romney won eight delegates, former Senator Fred D. Thompson of Tennessee won three, and Representative Duncan Hunter of California won one. Josh Romney, a son of Mr. Romney, whose organizational efforts here outstripped his rivals’, told reporters: “It was a great day. It shows we are running all over the country.” Wyoming Republicans were almost as exultant. Tom Sansonetti, a member of the Rules Committee of the Republican National Committee and a lawyer from Cheyenne, said at a news conference: “This is a very historic day for the Wyoming Republican Party. Iowa has the first caucus. New Hampshire has the first primary. But it’s Wyoming that elected the first delegates.” Iowa Republicans, who will have 40 delegates at the national convention, held a caucus on Thursday but elected no delegates. The winner there, Mike Huckabee , the former Arkansas governor, was all but invisible in Wyoming. Wyoming, never before even a whistle-stop in a Republican nominating campaign because its county conventions were held in March and were overshadowed by primaries in bigger states, deliberately broke party rules by holding its conventions before Feb. 5. By violating the dates allowed by the national party, Wyoming Republicans forfeited half of the state’s normal 28 delegates. The final two delegates will be elected at the state convention in May. Mr. Romney has made four campaign stops in Wyoming. His wife visited several times, and his sons Josh and Craig stumped in seven counties on Friday and Saturday. Mr. Thompson, Mr. Hunter, Representative Ron Paul of Texas and Senator Sam Brownback of Kansas, who dropped out of the race for the nomination late last year, have also visited the state. The conventions were asked to meet early and publicly report results. In Albany County, Tammy Johnson, the county chairwoman, moved things along quickly because many delegates had a funeral to attend. After two hours, the election was completed by 10 a.m., and she was elected the first Romney delegate in the nation. In Riverton, the Fremont County party was also scheduled to start at 8 a.m., but it did not make the target of a 9:30 a.m. vote announced by Perry Marple, the county chairman. The session was at times persnickety and at times amiable, with “Happy Birthday” sung to a Sunday school teacher who offered the opening prayer. Delegates also spent more than an hour arguing over which alternates should replace which absent delegates. Finally, at 3 p.m., Dennis Tippets was elected a Romney delegate by one vote. “It’s been exciting for us,” said Fred Paraday, the state chairman. “It’s our first time out of the shoot.” Wyoming Democrats will not start their delegation-selection process until March.

Romney Mitt
Presidential Election of 2008
Wyoming
Republican Party
Thompson Fred Dalton
Hunter Duncan
Huckabee Mike
Paul Ron
Brownback Sam


Men Often Mentored by Women at the Pool

Abstract: IRVINE, Calif. — The San Antonio Spurs’ hiring of Becky Hammon on Tuesday as the N.B.A.’s first full-time female assistant coach caught the eye of Dorsey Tierney-Walker, who was thrilled to welcome another woman into a club that she never viewed as exclusive. “Maybe to the outside world it looks groundbreaking,” said Tierney-Walker, the men’s and women’s swim coach at Arizona State for the past five seasons. “But from everything I’ve learned about her online, her path is no different, really, than the path a lot of us” took. Tierney-Walker, speaking by telephone, added: “Maybe that’s my ego, but I don’t know that I’ve ever felt overlooked or disrespected because of my gender. As a matter of fact, it’s kind of been the opposite. I consider myself more of a teacher than anything, and when you think about it, a lot of elementary school and high school teachers are women, so I think boys grow up comfortable with that dynamic.” Scores of male athletes at the USA Swimming long-course national championships have been coached by women at some point. Michael Phelps, the chlorinated version of Michael Jordan, swam for Cathy Bennett at Meadowbrook Aquatic and Fitness Center in Baltimore before he came under the tutelage of Bob Bowman. Ryan Lochte, swimming’s equivalent of Kobe Bryant, was coached by his mother as an age-grouper. Ian Thorpe of Australia was trained by a woman, Tracey Menzies, when he won two gold medals, a silver and a bronze at the 2004 Athens Olympics. The two-time Olympian Matt Grevers said he would probably have switched to basketball if not for the guidance he received from his high school coach, Lea Maurer, a 1992 Olympian and a former American-record holder in the 100-meter backstroke. “She was tough,” said Grevers, who holds the second-fastest time in the 100 backstroke. “She kicked me out of the practice when I was misbehaving. She would be there to nurture you if you deserved it, and she was there to discipline you if you deserved it. She kept me in the sport.” In 2011, when the 2000 Olympic gold medalist Anthony Ervin was testing the comeback waters, he trained at the University of California, Berkeley, with its women’s coach, Teri McKeever. Ervin, who represented the United States in the 50-meter freestyle at the 2012 Olympics, said: “I definitely had some nurturing spirit from her when I was first getting back into the swimming thing, and I absolutely, absolutely needed that. Much too early I put too much pressure on myself and defeated myself before I even began. So she was integral for that when I jumped back into the pool.” McKeever, who coached the men’s and women’s teams at Fresno State before taking the Cal job in 1992, is the head coach of the United States women’s team for the coming Pan Pacific Championships in Australia, a role she also filled at the 2012 Olympics, where she became the first woman to serve in that capacity. “Could she be a men’s coach?” Ervin said. “I don’t see a reason why not.” As a woman coaching women, McKeever is in the minority. Of the 123 universities represented at this year’s Division I women’s swimming championships, 17 had female head coaches. Image Ian Thorpe worked with Tracey Menzies when he won four 2004 Olympic medals. Credit Lionel Cironneau/Associated Press “That’s the hegemonic model of the society that we live in,” Ervin said. “It’s white-male-dominated, and everyone falls in line behind that. Is it ever going to flip on its head? I don’t know.” Tierney-Walker, a former all-American swimmer at Texas and a former national team member, said the dearth of women at coaching’s highest levels had a lot to do with life-balance choices. “If you’re coaching an elite-level program and you’re trying to raise a family, it can be pretty demanding,” she said. “I’m not going to lie. I’m divorced, and some of that was due to the effort I chose to put into my profession.” In 1961, Mary Kelly Spitzer, an Olympian turned coach, guided her Vesper Boat Club team to a national women’s title. She might have become the first woman to serve on the United States Olympic swimming staff but removed her name from consideration in 1964 because, she said, full-time coaches, all of whom were men, deserved the appointments. In 1968, she left coaching. In a 2008 interview with Swimming World magazine , Kelly Spitzer said she left the profession because her six children were approaching their teenage years and needed more of her attention. Maurer, who coached Grevers with the boys’ and girls’ teams at Lake Forest High School in Illinois, moved on to guide the women at Stanford. She stepped down in 2012 after seven seasons, citing a desire to devote more time to her husband and children. Family considerations also prompted Debbie Meyer, a three-time Olympic gold medalist in 1968, to take a hiatus from coaching after her men’s and women’s swim programs at Sacramento State were disbanded in the early 1990s. Meyer, who returned to coaching a few years ago when she bought a swim school, said in a telephone interview: “Women like Teri McKeever and myself, we’re not only authoritarians; we’re nurturers. We’re 2-for-1.” Meyer will get no argument from Missy Franklin, a rising sophomore at Cal. McKeever is the second coach Franklin has had. From the ages of 7 to 18, Franklin trained at Colorado Stars under Todd Schmitz, who became like a favorite uncle to her. McKeever, Franklin said, “really has become like a second mom to me, honestly.” Franklin added: “She’s able to push us, but at the same time she understands when we come in and we’re saying, ‘I just took a midterm, and I don’t know how it went.’ She takes the time to sit down and talk to us about the personal things that are going on because she knows how big of an impact that makes on our swimming. “And I love that she’s a coach that recognizes that. I think a lot of coaches don’t.”

Swimming
Women and Girls
Teri McKeever
Coaches
Sports
Becky Hammon


In Barclays Inquiry, the Calculation in Making a Deal - Common Sense

Abstract: Barclays : Too big to indict? The question needs to be faced in the wake of the bank’s admitted efforts to manipulate the London interbank offered rate , known as Libor, the benchmark for countless interest rate determinations and approximately $450 trillion in derivative contracts. If the Justice Department was looking for a textbook case of white-collar financial crime — including a conspiracy that was flourishing at the height of the financial crisis — this would seem tailor-made. As the facts released by the government make clear, there were two separate but overlapping schemes to manipulate Libor within Barclays. Yet the bank secured a nonprosecution agreement and agreed to pay a penalty of more than $450 million, a comparatively paltry sum for a bank that had more than £32 billion ($50 billion) in revenue in 2011. “The perception so far has been that the regulators have been toothless,” John C. Coffee Jr., professor of law and specialist in white-collar crime at Columbia Law School, told me this week. The first Barclays scheme, which flourished from 2005 to 2007, and continued sporadically as recently as 2009, involved Barclays traders who were trying to manipulate Libor and another benchmark rate to enhance their trading profits. Libor is set each day by the British Bankers’ Association based on rates submitted by a panel of banks that included Barclays. The submissions are supposed to reflect the rates at which banks can borrow from other banks. Because of the huge amounts of derivative contracts riding on Libor, even a tiny shift can have enormous consequences. Senior Barclays managers have said they knew nothing about this scheme, and Robert E. Diamond Jr., chief executive at the time, told Parliament last week that he was “physically sick” when he read the e-mails describing the activity. He added, “I think people who do things that they’re not supposed to do should be dealt with harshly.” The second scheme ran from approximately August 2007 to January 2009, a period covering the fall of Lehman Brothers and the worst of the financial crisis. Senior Barclays managers instructed traders to submit falsely low rates to counter the perception that other banks were charging high rates to lend to Barclays, a sign of financial weakness. Various e-mails and other documents suggest that Barclays did this to protect its reputation, to avoid appearing to be an “outlier” among major banks and, according to one document quoted by the Justice Department, to keep Barclays’ “ head below the parapet ” so it did not get “shot” off. (Barclays agreed not to contest any of the statement of facts released by the government.) Barclays may also have submitted falsely low rates because it thought that’s what regulators wanted it to do. At the peak of the financial crisis, lower Libor rates helped reassure skittish investors that the financial system was sound. Barclays has released documents suggesting concern at the Bank of England about its high Libor submissions as well as evidence that Barclays tried to alert regulators on both sides of the Atlantic about its suspicions that other banks were submitting falsely low Libor rates. But even if true, those may be mitigating factors, not defenses to a crime. In its news release, the Justice Department didn’t say what crimes Barclays might have committed, referring only to “violations” and “misconduct.” But it had multiple options. A corporation is liable for any crimes committed by its employees acting within the scope of their employment. Making false Libor submissions is a fraud — both on Barclays’ derivatives counterparties that lost money and on investors in Barclays stock who relied on its soothingly low Libor rates as evidence of the company’s health. Violations of the Commodities Exchange Act, which prohibits manipulation and fraud in the trading of commodities, as well as the Securities Act, which prohibits fraud in the purchase and sale of securities, may be crimes, as is mail and wire fraud, commodities fraud and conspiracy. Moreover, agreements by Barclays traders with others involved in the Libor process are, on their face, conspiracies “in restraint of trade,” which the Sherman Act says are “illegal,” and those who engage in such conspiracies “shall be deemed guilty of a felony.” (The criminal division said its agreement with Barclays was reached in conjunction with the antitrust division.) A crucial element in any prosecution is criminal intent, and it’s plain from the Barclays e-mails that various participants knew that what they were doing was wrong. As one Barclays trader put it in e-mails to traders at other banks, “don’t talk about it too much,” “don’t make any noise about it please” and “this can backfire against us.” Faced with what would seem to be an open-and-shut case, how did the Justice Department proceed? Barclays entered into a nonprosecution agreement in which the United States government agreed not to prosecute Barclays as long as it met its other obligations under the agreement, including continued cooperation in what the government said was an investigation still under way. Barclays also received a conditional grant of immunity from the antitrust division. As part of such nonprosecution agreements, the Justice Department is entitled to demand management changes to ensure further compliance with the law, including the removal of employees and officers. Yet the agreement allowed Mr. Diamond to remain as chief executive; the British prime minister, David Cameron, had to prod him to resign last week. The United States government “had the smoking guns,” Professor Coffee said, and “it could have demanded its price from Barclays,” including a guilty plea to a crime. At the same time, the agreement “isn’t surprising,” he said. “The Department of Justice has done this in almost every major case since the collapse of Arthur Andersen.” (Andersen was the accounting firm indicted after the collapse of Enron.) “They’re afraid of unwanted consequences,” he added. “This is especially true of financial institutions. They don’t want to set off a banking panic or domino effect by indicting a major bank.” The United States government didn’t want to put Barclays out of business, and in this sense, Barclays may indeed have been too big to charge with a crime. But if that was a factor, the government didn’t mention it. Instead, it pointed to Barclays’ willingness to cooperate against other parties, as yet unnamed. The Justice Department called Barclays’ cooperation “extraordinary” and “extensive” and said it was the first bank to “cooperate in a meaningful way.” The department’s principles say that “timely and voluntary” disclosure of wrongdoing is an important factor to be considered, although cooperation shouldn’t “automatically” qualify a potential defendant for immunity or nonprosecution. Benjamin Heineman, former general counsel of General Electric and now a distinguished senior fellow at Harvard Law School, said that such incentives to cooperate were “critically important,” especially for the first mover. “This looks like a classic case where they squeezed Barclays and Barclays yelped, which will be important for the making of cases against the other Libor banks. There was obviously collusion with other banks.” Professor Coffee agreed that “you always give substantial concessions to the first to plea bargain,” adding: “The government is getting evidence it might otherwise not get. It also gets cooperating witnesses.” Both noted that it was too soon to know if Barclays deserved leniency, since the value of its cooperation will become apparent only in future prosecutions of other banks and individuals within Barclays. Nothing in the Barclays agreement prevents the Justice Department from obtaining indictments against Barclays employees and high-ranking executives if warranted — and based on the evidence the government unveiled, plenty of Barclays employees are in need of criminal defense lawyers. Whether future individual cases lead to meaningful deterrence also remains to be seen. The Justice Department sent me a list of two dozen nonprosecution or deferred prosecution agreements that eventually led to individual prosecutions, from UBS tax evasion to Alcatel-Lucent foreign bribery and the Beazer Homes mortgage and accounting fraud. On the other hand, cases like the Tyson Foods bribery case scheme didn’t yield any criminal charges. In theory, size alone shouldn’t prevent corporate guilty pleas to crimes. It isn’t mentioned as a relevant factor in the Justice Department’s guidelines for leniency, and it hasn’t stopped the department from obtaining guilty pleas from several large publicly traded companies. The engineering giant Siemens pleaded guilty to criminal counts of maintaining false books and records related to foreign bribery in 2008, and last week, the pharmaceutical company GlaxoSmithKline pleaded guilty to medical fraud and agreed to pay $3 billion. While their reputations have been damaged, neither company has failed as a result. As the government guidelines state, “indicting a corporation for wrongdoing enables the government to be a force for positive change of corporate culture, and a force to prevent, discover and punish serious crimes.” The real test will be the government’s willingness to indict or obtain a guilty plea from a major bank. If the Barclays agreement is any indication, it will have plenty of opportunities. None of the other banks implicated can take credit for being the first to come forward, since Barclays has already claimed that prize. “I think we’re only about 10 percent of the way through this mess,” Mr. Heineman said.

Libor (London Interbank Offered Rate)
Barclays PLC
Crime and Criminals
Frauds and Swindling
Regulation and Deregulation of Industry
Justice Department


Jimmy Garoppolo Rises From the Ashes of Deflategate

Abstract: Passionate partisans on both sides of the Deflategate debate — and there are still many out there — will tell you that it was a battle between right and wrong, truth and lies, even good and evil. But fundamentally it was a battle over whether Jimmy Garoppolo would play four games at quarterback for the Patriots in place of Tom Brady. After several twists and turns in rulings by the N.F.L., an arbitrator and courts of law, the Patriots and Brady ended up losing. Garoppolo started the first of those four games Sunday night in Week 1 of the N.F.L. season , against the Arizona Cardinals. And after his efficient first drive — four of five pass completions and a beauty of a 37-yard touchdown pass to Chris Hogan — many must have been wondering: What was all the fuss about? Image Jimmy Garoppolo threw confidently in the pocket, and used his feet to cause problems outside it. Credit Mark J. Rebilas/USA Today Sports, via Reuters The scandal — or farce — brought some unforgettable oddities. A destroyed phone, mysterious texts about a “deflator” and even the length of a bathroom visit became fodder for debate. But the competing scientific studies of air pressure , the voluminous Wells report , and the angry denunciations by Patriots officials and fans might now seem a bit overblown after Garoppolo’s performance in the Patriots’ 23-21 win. Before the game, the identity of New England’s quarterback seemed to matter a great deal. Both teams were elite last year, each coming a game short of the Super Bowl. In ordinary circumstances, one might expect Arizona to be a small favorite at home. But with the Patriots starting Garoppolo instead of Brady, the Cardinals were picked to win by as many as 9 points. Playing without the Patriots’ injured star tight end, Rob Gronkowski, Garoppolo finished the game with sterling numbers, going 24 of 33 for 264 yards and no interceptions. He capped it with the game-winning drive. Going into Monday night’s games, Garoppolo ranked eighth in the league in quarterback rating. Last year’s Most Valuable Player Award candidate Carson Palmer was a very comparable 24 of 27 for 271. And Garoppolo put up those numbers despite having little N.F.L. experience. He threw 27 passes in cameo appearances in his rookie year, 2014, but just four last season. The Patriots did not change their offense drastically for Brady’s understudy. Garoppolo threw on 52 percent of downs; last year, the Patriots threw on 62. Patriots fans hoping to place the suspension in a positive light said that it would provide a useful audition for Garoppolo, 24, to see if he is the man to eventually replace Brady, 39. A second-round pick out of Eastern Illinois, Garoppolo (pronounced Guh-ROP-uh-low) came into the league far less heralded than some of this season’s top picks, like Jared Goff and Carson Wentz. But then so did Brady, a sixth-round pick. Still, second-round quarterbacks seldom succeed as N.F.L. stars. For every Brett Favre or Drew Brees, there is a Jimmy Clausen, or worse, a Marques Tuiasosopo or Brian Brohm. Garoppolo’s performance might have reminded some of Matt Cassel, a seventh-round pick who filled in for Brady in 2008, the only season when Brady missed any significant time. Cassel’s numbers were somewhat worse than Brady’s, but the team was still fairly successful, going 11-5 and missing a playoff berth on a tiebreaker. Cassel went on to play seven more seasons, including some good ones in Kansas City. Garoppolo’s four-game stretch will continue with three significantly easier games, all at home, against the Dolphins, the Texans and the Bills. If his numbers stay the same, or improve with a little experience, and the Patriots come out 3-1 or even 4-0, maybe everyone will take a deep breath and let Deflategate go. Probably not, though.

Football
Arizona Cardinals
Patriots
Tom Brady
Jimmy Garoppolo


Microsoft Buys Stake in Facebook

Abstract: SAN FRANCISCO, Oct. 24 — Microsoft has won a high-profile technology industry battle with Google and Yahoo to invest in the social networking upstart Facebook . The two companies said on Wednesday that Microsoft would pay $240 million for a 1.6 percent stake in Facebook. The investment values Facebook, which is three and a half years old and will bring in about $150 million in revenue this year, at $15 billion. The deal throws the value of the holdings of Facebook investors into the stratosphere. Mark Zuckerberg, the 23-year-old Facebook founder who followed the path of Bill Gates by dropping out of Harvard to build a company, owns a 20 percent share that may now be worth as much as $3 billion. Accel Partners, the venture capital firm that invested $12.7 million in May 2005, now holds stock that could be worth $1.65 billion. The investment also ends two months of jockeying among three major Internet players for the right to invest in and forge close ties with Facebook. Microsoft and Facebook executives said they had met in several cities over the last month and moved toward consummating the deal by sending cellphone text messages to each other while Steven A. Ballmer, chief executive of Microsoft, was speaking last week at the Web 2.0 technology conference in San Francisco. “There were a lot of twists and turns, as there always are in these things,” said Owen Van Natta, chief revenue officer of Facebook. The final negotiations were completed Wednesday morning in Facebook’s offices in Palo Alto. As part of the deal, Microsoft will sell the graphical banner ads appearing on Facebook outside of the United States, splitting the revenue. Microsoft has an existing deal with Facebook to run banner ads on the site in the United States through 2011. The astronomical value placed on Facebook is evidence that Microsoft executives believed they could not afford to lose out on the deal. Google appears to be building a dominant position in the race to serve advertisements online. Fearing it might lose control over the next generation of computer users, Microsoft has been trying to keep up with and in some cases block Google’s moves, even if that effort is costly. “We are now stepping outside what is typically a business decision,” said Rob Enderle, the founder of the strategy concern Enderle Group. “This was almost personal. I wouldn’t want to be the executive that’s on the losing side at either firm.” In a conference call with journalists and analysts, Kevin Johnson, president of the platforms and services division at Microsoft, described the deal as a “major advertising syndication win for Microsoft.” “The equity stake that we are taking in Facebook is a strong statement of confidence in this partnership,” Mr. Johnson said. “It’s a statement of confidence in the fact that our advertising platform is going to get stronger and will help monetize Facebook.” On the same call, Mr. Van Natta responded to a question about reports that both Yahoo and Google were bidding to invest in Facebook by saying, “We were very fortunate to have a lot of folks interested in a partnership with us around advertising.” Mr. Van Natta said the investment would allow the company to more than double its work force to 700 employees by the end of next year. He also said it would help Facebook expand internationally and buy the technology to help keep up with its rapid growth. Facebook says it has 50 million active members and is adding 200,000 new ones each day. MySpace, the site owned by the News Corporation that is Facebook’s main rival in social networking, has more than twice as many members but is growing more slowly. The two companies left several questions unanswered. Facebook hinted that it had other investors alongside Microsoft, but declined to say who they were or how much money they had injected into the company. It was also unclear whether Facebook would involve Microsoft as it continued to develop its own advertising network to serve ads on portions of its site. Facebook has plans to introduce an advertising system at an event in New York City next month. Speaking with reporters after a conference for analysts at Google headquarters, Eric E. Schmidt, Google’s chief executive, declined to comment about losing out to Microsoft, but suggested that Google would be open to collaborating with Facebook. Google already makes money on Facebook indirectly, by selling ads inside third-party applications that run on the site. A person briefed on the discussions said Google had dropped out not because of the financial terms, but because the proposed deal did not give it enough say in the development of their joint advertising efforts. Facebook’s $15 billion value also represents a belief that the company is creating an important new operating system that, unlike Microsoft’s Windows, exists on the Web instead of on personal computers. In May it began inviting other companies and outside developers to create tools for the site and share in the advertising revenues. The move unleashed a flurry of activity around the social network. More than 5,000 applications, like games and music-sharing tools, have since been created for the site, a step that has in turn accelerated Facebook’s membership growth. “Once a social operating system takes over a country, it’s like it becomes the native language of that country,” said Lee Lorenzen, a venture capitalist who has invested in companies making Facebook applications. Mr. Lorenzen noted that Google’s Orkut dominates Brazil, Friendster dominates the Philippines and Facebook is becoming the dominant forum in the United States, Canada and Western Europe. Facebook boosters say social networking represents the future of online activity. Advertisers are attracted to these sites because they offer an opportunity to aim ads at particular users who are likely to be interested in their product or service. Mr. Lorenzen and other investors are often dismissive of MySpace. “MySpace is not based on authentic identities,” he said. “Facebook is based on who you really are and who your friends really are. That is who marketers really want to reach, not the ‘fantasy you’ that lives on MySpace and uses a photo of a model.” The News Corporation bought the parent company of MySpace in 2005 for $580 million. That amount seems small now, an indication of how fast the value of Web companies has risen in the current climate of optimism.

Facebook.com
Microsoft Corp
Mergers Acquisitions and Divestitures
Computers and the Internet


Laying Out Olympic Ski Courses for Friend and Foe

Abstract: WHISTLER, British Columbia — If the coaches who set the Olympic ski courses are indeed Picassos of the snow, their artwork does not last for long. The first run of the men’s giant slalom event at Whistler Creekside was set on Monday morning by the French coach David Chastan. By late Tuesday morning, when the American Ted Ligety and the world’s other top technical skiers have finished carving turns between the gates, another coach, Matteo Guadagnini of Italy, will pull up Chastan’s gates and follow his own muse and national interest as he sets the second run. “There’s really not another sport that I can think of that does it like this,” said Pete Korfiatis, a coach with the United States ski team who inspected Chastan’s first-run set with dozens of other coaches on Monday and will be positioned on the hill during Tuesday’s race. Of the five Olympic events — downhill, super-G, giant slalom, slalom and super combined — only the downhill (the longest and fastest) does not rely on national-team coaches for course settings. “World Cup downhills are essentially set by GPS now,” Korfiatis said. “Which is cool because it means basically that classic downhills will always remain classic downhills.” But the other events rely exclusively on humanity and a portable drill for setting gates, and being selected to set an Olympic course is both an honor and a potential advantage, though hardly a guarantee. On Sunday, the slalom portion of the men’s super combined was set by Ante Kostelic of the Croatian team, who happens to be the father of Ivica Kostelic, the Croatian skier who was among the favorites. Both Kostelics had complained that the new combined format, which allows for only one slalom run instead of the traditional two, unfairly favored the downhillers, particularly if the slalom course was made too easy. So most observers were expecting a highly selective and challenging set from Ante Kostelic. “The set was fine; we understood it,” said Sasha Rearick, the United States men’s coach. “But I saw some things in there I’ve never seen before. There were some funky combinations.” Not funky enough to throw off all of Kostelic’s competitors, however. Bode Miller of the United States ended up the winner , with Kostelic in second, even though Kostelic said that he had practiced some of the gate combinations that his father had set before Sunday’s race. “I don’t think it was a big advantage, because nobody really had a problem there — well, at least most of the guys,” Kostelic told reporters in the finish area. Aksel Lund Svindal of Norway, the leader after the downhill portion of the combined, straddled a gate that he called a “Kostelic gate” near the bottom of the slalom course and failed to complete his run. “It was the kind of hairpin turn you wouldn’t see normally,” said Steve Porino, the former U.S. Ski team racer who is now an NBC ski commentator. “Ante Kostelic has a reputation that he basically puts on a blindfold and starts poking holes in the snow. He’s very creative in the way he sets slalom, and some complain about it. But he sets within the rules. Ivica has been skiing these very creative courses, little Picassos, his whole life, and Svindal suffered from the Kostelic set. But Kostelic didn’t win. I think it was a fair set.” Clearly, great talent can trump a carefully calculated set, but setting a course does have its advantages. Andrea Fischbacher of Austria upset Lindsey Vonn to win the women’s super-G here on a course set by the Austrian coach Jürgen Kriechbaum. Though it might seem odd and wildly biased that a father gets to set the course for his child’s race at this level, it is long-established practice for national-team coaches to set courses on the World Cup circuit. Unlike Picasso, they must follow numerous rules as they create, including International Ski Federation guidelines that establish a minimum number of turns, or direction changes, per run based on the amount of vertical drop. According to Korfiatis, the average giant slalom will have more than 50 direction changes, defined as a transfer from one edge of a ski to the other. There can also be more constraints in setting a second run because of fixed television camera positions. “That might only happen in a couple of spots that are theoretically difficult to grab with a camera,” Korfiatis said. “Frankly it’s your right to set wherever you want. You could go there. It’s just going to be a bad show on TV.” No American coaches were picked to set any of the Olympic men’s or women’s courses here. The random draws for the course setters were held late last month: for the men in Kitzbühel, Austria; for the women in St. Moritz, Switzerland. The chances of a national team’s being selected to set increase with the number of skiers it has in the top 15 of the World Cup rankings, but no team is allowed to set more than one run of the four available in giant slalom and slalom. France, with only one skier in the top 15 in the men’s giant slalom, was a long shot to get to set the course in that event in Whistler. The Italians, with four men in the top 15, were more likely lottery winners. Once the course setters are announced, their rivals can go to work. “We actually have books and logs on what each guy set before and therefore we can go out in training and try to simulate this type of set,” Korfiatis said. “The French generally will set regular with some swings, go into corners pretty hard. The Italians are going to be a little bit tighter, a little more fall line, a little more speed.” There has been increasingly serious discussion in the ski community about appointing an independent person or group to set courses in the future, but for now, it is only discussion. And on Wednesday, Anders Paerson, a coach with the Swedish team, is scheduled to set the second run of the women’s giant slalom in which one of the favorites will be his daughter Anja.

Alpine Skiing
Olympic Games (2010)
Miller Bode
Svindal Aksel Lund
Vonn Lindsey


Wary of Egypt Unrest, China Censors Web

Abstract: BEIJING — In another era, China ’s leaders might have been content to let discussion of the protests in Egypt float around among private citizens, then fizzle out. But challenges in recent years to authoritarian governments around the globe and violent uprisings in parts of China itself have made Chinese officials increasingly wary of leaving such talk unchecked, especially on the Internet, the medium some officials see as central to fanning the flames of unrest. So the arbiters of speech sprang into action over the weekend. Sina.com and Netease.com — two of the nation’s biggest online portals — blocked keyword searches of the word “Egypt,” though the mass protests were being discussed on some Internet chat rooms on Monday. Searching for “Egypt” has also been blocked on Weibo, the Chinese equivalent of Twitter. Censoring the Internet is not the only approach. The Chinese government has also tried to get out ahead of the discussion, framing the Egyptian protests in a few editorials and articles in state-controlled news publications as a chaotic affair that embodies the pitfalls of trying to plant democracy in countries that are not quite ready for it — a line China’s leaders have long held. The English-language edition of Global Times, a populist newspaper, ran an editorial on Sunday about the Tunisian and Egyptian protests with the headline “ Color revolutions will not bring about real democracy .” Though Global Times is not the official mouthpiece of the Communist Party, the message of the editorial was consistent with official thinking, saying bluntly that whether democracy “is applicable in other countries is in question, as more and more unsuccessful examples arise.” “The official Chinese media is reporting the Egypt events — it’s no longer possible for Xinhua and other official media to remain credible if they hide international news that people can learn from the Internet,” said Susan L. Shirk, a professor at the University of California, San Diego, who served as assistant deputy secretary of state during the Clinton administration. “But they reduce the risk that some Chinese might want to emulate them by describing them as 'anti-government riots.'" Some Chinese news organizations have also seized on the ambivalent American reaction to the Egyptian unrest to underscore the hypocrisy of the United States in sometimes backing dictators over democracy. They argued that those who appear to be the greatest advocates of democracy sometimes have conflicted feelings about its spread, especially in the Middle East, where the United States fears the proliferation of populist radical Islam. China Youth Daily noted in an editorial on Sunday that “the increasing turmoil in Egypt is causing a ‘headache’ for the decision makers in Washington.” Some of the news coverage of Egypt that has appeared in People’s Daily, the Communist Party’s main newspaper, and Xinhua, the official news agency, has focused on attempts by China to evacuate its citizens, simply leaving out the political discontent at the root of the unrest. Xiao Qiang, an adjunct professor at the University of California, Berkeley, and an expert on Internet censorship in China, said propaganda officials had recently ordered Chinese news organizations and Web sites to strictly follow Xinhua reports on Egypt. But Mr. Xiao said some Internet forums were closely tracking the events in Egypt. “I can see the Egypt story being followed and discussed by active netizens everywhere — blogs, forums, social networking services like Kaixin and Renren,” he said. “It’s just not on the front page of major Web sites.” The Chinese authorities’ efforts to censor and shape news on the Internet have evolved over the past few years, as they grappled with unrest during the Tibet riots in 2008 and protests against the Olympic torch relay. The authorities initiated a crackdown on pornography and other “harmful information,” including shuttering a popular liberal forum, soon after the release of Charter 08, an online manifesto calling for gradual democratic reforms that gathered thousands of signatures through e-mail. Internet controls ramped up in late 2009, when officials observed how social networking sites and other forums helped inflame unrelated outbursts of protests and rioting in Iran and Xinjiang, the restive region in China’s west. In an August 2009 article on the Iran protests, a monthly journal published by the central propaganda department warned of the challenge posed by sites like Twitter and Facebook, which the authorities had blocked days after riots in Xinjiang. In January 2010, after Secretary of State Hillary Rodham Clinton announced a new United States policy to counter online censorship abroad, an editorial published by People’s Daily charged that the United States had used the Internet — YouTube and Twitter in particular — to stir up “online warfare” against Mahmoud Ahmadinejad, the Iranian president. The Internet’s influence on the volatile events in Iran and Xinjiang “impacted the leadership like an earthquake,” said one media investor with high-level ties to China’s regulators who spoke on the condition of anonymity for fear of damaging that relationship. The fact that social networking sites have fueled the protests in Egypt will no doubt spur Chinese officials to further scrutinize such sites. And they may be right to pay attention: Zhao Jing, a liberal Chinese blogger who goes by the name of Michael Anti, said that “it was amazing netizens on Twitter cared about Egypt so much” that they had begun drawing parallels between China and Egypt. President Hosni Mubarak of Egypt was being called Mu Xiaoping, a reference to Deng Xiaoping, who quashed the 1989 popular protests in Beijing, while Tahrir Square in Cairo was being compared to Tiananmen Square. Yet, there are intellectuals in Beijing skeptical of any similar protests arising in China, mainly because this nation’s dynamic economy has given many Chinese hope for a better life. “I don’t think dissemination of such news would cause unrest in China,” said Jia Qingguo, associate dean of international relations at Peking University. “Egypt is a different type of political regime from China. They are also not a socialist country. They have their own particular problems.”

China
Egypt
Censorship
Computers and the Internet
Demonstrations Protests and Riots
Mubarak Hosni


Bernanke Defends His Role in Merrill Sale

Abstract: WASHINGTON — Ben S. Bernanke , the chairman of the Federal Reserve , staunchly denied on Thursday that he or anyone else at the Fed did anything improper in prodding Bank of America to complete its ill-starred takeover of Merrill Lynch last year. “The Federal Reserve acted with the highest integrity throughout the discussions with Bank of America regarding that company’s acquisition of Merrill Lynch,” Mr. Bernanke told a packed hearing of the House Oversight Committee. In three hours of grueling questions from lawmakers armed with e-mail messages and internal documents, the Fed chairman flatly denied accusations that he had threatened to oust the bank’s top management if it pulled out of the deal. He also denied that the Fed had maneuvered to postpone public disclosures about Merrill Lynch’s spiraling losses until after the merger was completed on Dec. 30, and he denied that Fed officials had kept other financial regulators in the dark about plans to bail out Bank of America in January. But Mr. Bernanke did not appear to satisfy lawmakers from either party. Republicans accused Mr. Bernanke of strong-arming a private company, which one lawmaker called “socialistic.” Democrats complained that Mr. Bernanke had not been tough enough, and had perhaps been bamboozled into bailing out Bank of America. “This was a forced situation, a shotgun wedding, and we still need to find out who was holding the shotgun,” said Representative Edolphus Towns, Democrat of New York and chairman of the oversight committee. Though Bank of America originally agreed in September to buy Merrill Lynch without federal help, its executives threatened to scuttle the deal in December because Merrill’s losses for the quarter had ballooned to about $14 billion. Neither the Fed nor Bank of America disclosed the magnitude of Merrill Lynch’s losses before the deal closed on Dec. 30. Instead, they waited until Jan. 16, the same day that the Fed and the Treasury Department announced a bailout for Bank of America that included $20 billion in fresh capital and guarantees against losses on $118 billion worth of Merrill Lynch’s weakest assets. But newly released Fed documents and e-mail messages indicate that Fed officials became locked in a tense struggle with Bank of America last December, with Fed officials deeply skeptical about the competence of the bank’s executives and their grasp of Merrill Lynch’s financial condition. The documents show that many Fed officials refused to believe that Kenneth D. Lewis, Bank of America’s chief executive, had not learned about Merrill’s losses until mid-December. Many top officials wanted to shake up the bank’s top management, or at least rein in its activities, in exchange for government rescue money. One official asked how the central bank could best extract a “pound of flesh” from the bank. On Dec. 17, Mr. Lewis told Mr. Bernanke and the Treasury secretary, Henry M. Paulson Jr., that Merrill Lynch’s losses in the fourth quarter of 2008 would be about $14 billion — four times more than the bank had estimated two weeks earlier. Mr. Lewis also warned that Bank of America might try to cancel the deal by invoking an escape provision in the contract called a “material adverse change” clause, or MAC. That meeting led to weeks of tense negotiation, in which Bank of America executives pleaded for the Fed and Treasury to come up with a big bailout package before the deal was supposed to close. Mr. Bernanke testified that he had initially suspected that Bank of America was bluffing, in order to have the government finance most of the Merrill takeover. But both he and Mr. Paulson worried that scuttling the deal would kill Merrill Lynch and would set off another wave of panic and chaos in financial markets. In handwritten notes taken by a Fed official at the meeting, Mr. Bernanke is said to have remarked that a “downside of $50 billion doesn’t sound big for BA” and that not completing the deal would lead to “big problems” for both the markets and the two companies. After the meeting, senior Fed officials fumed that Bank of America executives had been minimizing the bank’s own problems, which were dire and getting worse even without the burden of Merrill’s bad assets. They also expressed disbelief that Bank of America had been surprised by Merrill’s losses, which they viewed as predictable. “The deterioration at ML has been observably under way over the entire quarter,” wrote Tim P. Clark, a senior Fed staff official, in an e-mail message to three Fed governors and other top officials on Dec. 19. “Ken Lewis’ claim that they were surprised by the rapid growth in losses seems somewhat suspect.” Other Fed officials were even more scornful. “Personally, I think management should be downgraded,” wrote Deborah P. Bailey, a senior Fed official, on Dec. 20. “I always had my doubts about the quality of due diligence they did on the ML deal. Don’t forget they paid a premium. How do you pay a premium and now ask for help? This will not go over well at all.” At the hearing on Thursday, Mr. Bernanke insisted that Fed officials let Bank of America executives make their own decisions. “The decision to go forward with the merger rightly remained in the hands of Bank of America’s board and management, and they were obligated to make the choice they believed was in the best interests of the shareholders and company,” he testified. That contradicted testimony by Mr. Lewis, who told the oversight committee on June 11 that Fed and Treasury officials had threatened to oust the bank’s top management and board if it refused to complete the deal. Members of the committee pressed Mr. Bernanke on his denials, displaying e-mail messages between Fed officials that made it clear they did not want Bank of America to walk away from Merrill Lynch. “You have all this pattern here,” said Representative Jim Jordan, Republican of Ohio. “Do you see how a reasonable person could reach the conclusion that there was this pattern of pressure from the government?”

Bernanke Ben S
Bank of America Corp
Merrill Lynch & Co
Federal Reserve System
Mergers Acquisitions and Divestitures


From the Pool to the Dead Sea

Abstract: Ben Wildman-Tobriner fulfilled one dream in August by helping the United States 400-meter freestyle relay team win an Olympic gold medal in Beijing. He realized another this month when he traveled to Israel for 10 days as the 200,000th participant in Taglit-Birthright Israel, an organization that provides first-time educational trips to Israel for Jewish young adults. Wildman-Tobriner, 24, was there as hostilities between Israel and Hamas intensified in Gaza. A Stanford graduate who began medical school at the University of California, San Francisco, last fall, Wildman-Tobriner said that he would not trade the experience for anything but that he was glad to be home. KAREN CROUSE WERE YOU FEARFUL GIVEN WHAT WAS GOING ON IN GAZA WHILE YOU WERE THERE? My mom was less than thrilled, but we had Israeli security police accompanying us and we were fine. It was an incredible trip, just as good as advertised. I was far away from Gaza. Days earlier, I was in northern Israel right near where those random rockets got fired from Lebanon and landed in Nahariya. When you’ve been there and have seen these places, it really does change the way you view events. It’s no longer an abstract event. WHAT WAS THE HIGHLIGHT OF THE TRIP? One thing that comes to mind was getting to float in the Dead Sea. You really have to float. From a distance, it looks like a normal body of water, but up close, you realize there’s no way you can swim in it. You don’t want to be getting that salt in your mouth or eyes. WHAT PLACE DID RELIGION OCCUPY IN YOUR LIFE BEFORE THIS? I think a lot of Jews who are in my generation have become a little disconnected from their roots. I’d put myself in that category. ARE YOU SUPPLEMENTING YOUR STUDIES WITH ANY PRACTICAL EXPERIENCE? I’m involved in a free clinic once a week in the Mission District in San Francisco. It’s helped round out my perspective of health care. At the U.S.F. Medical Center, you’re looking at the highest of high medical care. People fly in from all over the world to be treated there. A few miles away, there are people struggling to get basic antibiotics. HAVE YOU RETIRED FROM SWIMMING? It’s really up in the air, to be quite honest. I haven’t decided to go down any path yet. I may decide to pass on the major meets this year. SOME OF YOUR OLYMPIC TEAMMATES ARE IN ACTION THIS WEEKEND IN LONG BEACH, CALIF. WILL YOU FOLLOW THE RESULTS? I’m always interested in the results. At the short-course nationals in Atlanta in December, one of my best friends, Matt Grevers, took a stab at my American record in the 50-yard free. He’s swimming it again this weekend, and I’m sure he’ll be trying to break it again.

Wildman-Tobriner Ben
Olympic Games (2008)
Taglit-Birthright Israel
Israel
Gaza Strip
Hamas