news.notes20090516a

[Biography of the Day] from [Britannica]

Saturday, May 16, 2009
Olga Korbut
Soviet gymnast Olga Korbut, born this day in Belorussia (now Belarus) in 1955, earned three gold medals at the 1972 Olympics in Munich, West Germany, where she captivated audiences with her charm, youth, and diminutive size.

[On This Day] from [Britannica]

Saturday, May 16, 2009
1991:1943: Warsaw Ghetto Uprising suppressed
On this day in 1943, Nazi troops quelled the month-long Warsaw Ghetto Uprising, in which Polish Jews, led by Mordecai Anielewicz and the Jewish Fighting Organization, resisted deportation to the Treblinka extermination camp.


[TODAY'S TOP STORIES] from [The Japan Times]

[NATIONAL NEWS]
Saturday, May 16, 2009
DUI driver's prison stint now 20 years
2006 hit-and-run killed three kids

FUKUOKA (Kyodo) The Fukuoka High Court sentenced a former city employee to 20 years in prison Friday for causing the deaths of three children in a 2006 hit-and-run crash while driving under the influence of alcohol, overturning a 7 1/2-year sentence given by a lower court.

The high court said Futoshi Imabayashi, 24, had drunk a substantial amount of alcohol and should face the charge of dangerous driving, which is substantially more serious than the charge of professional negligence resulting in death and injury applied by the Fukuoka District Court in January last year.

"The lower court determination that attributed the cause of the accident to inattentive driving is wrong," presiding Judge Hiroo Suyama said in his ruling.

He also said "the influence of alcohol" must have been the only reason for the defendant's failure to notice the car ahead of him, which a person would "certainly have noticed if driving normally."

Imabayashi's vehicle slammed into the car, causing it to plunge 14 meters off a bridge into Hakata Bay in the city of Fukuoka in August 2006, leading to the deaths of the three children, aged 4, 3 and 1. His vehicle then traveled another 300 meters farther.

The high-profile accident helped spur stricter penalties against drunken driving.

Responding to the high court's verdict, the 32-year-old mother of the three deceased children, Kaori Ogami, said "I'm overwhelmed."

The 36-year-old father of the children, Akio, added, "The presiding judge has answered our wishes."

At a news conference after the ruling, the couple said they have suffered terribly in the two years and nine months since the accident.

"A proper ruling has been handed out to suit the heinousness (of the accident)," the mother said.

"We'd like to spend a quiet time today, only with family members," she added.

While Imabayashi's counsel argued that the victim's sudden braking and inattentive driving caused the accident, prosecutors demanded a 25-year prison term on combined counts of dangerous driving under the Penal Code and involvement in a hit-and-run case under the road traffic law.

Dangerous driving is applied when a court recognized that a motorist found it difficult to drive normally because of being under the influence of alcohol.

The district court denied Imabayashi was heavily intoxicated at the time, giving him the maximum penalty for the combined charges of professional negligence resulting in death and injury.

Imabayashi, after drinking beer and other alcohol, was driving at a speed of 100 kph when his car slammed into the vehicle with Akio at the wheel on Aug. 25, 2006, sending the family of five into the bay. The parents escaped and managed to pull free their 3-year-old son and 1-year-old daughter. But the two children died later despite medical aid given by rescuers. The 4-year-old son did not make it out of the vehicle.


[NATIONAL NEWS]
Saturday, May 16, 2009
U.S. wants to study shinkansen technology

WASHINGTON (Kyodo) A senior official of the U.S. Federal Railroad Administration expressed hope Thursday that Japan will offer its technical expertise to the United States in building a high-speed railway network.

"I think Japan is one of several very good systems that we're interested in looking at," Karen Rae, FRA deputy chief, said in an interview. "We're impressed with the breadth of technology and the accomplishments," she said, referring to the shinkansen network.

President Barack Obama has highlighted a multibillion dollar effort to develop a high-speed U.S. railway system, saying such a network would save energy, create jobs and reduce dependence on automobiles and airplanes.

Rae said the FRA has had a long relationship with Japan, "especially our technical and safety people have worked extensively to share technology and research and learn from each other."

While praising Japan's railway technology, however, Rae also said Washington is in talks with other countries with high-speed railways, citing Spain and France.

She said the FRA is reaching out to "a number of countries that have success in high-speed rail" and that "Japan is one of many."

In addition, Rae said each U.S. state, rather than the FRA, will advance the high-speed railway initiative, noting the FRA is trying to help gather information and apply "the best fit to each state."

"Some will be like a Japanese system, perhaps. Some will be like many of the other wonderful systems," she said.

"And one of the things we're trying not to do is create a cookie cutter, where everything is exactly the same," Rae said. "It really needs to be designed around the local and state needs."

Transportation Secretary Ray LaHood expressed interest earlier this month to visit Japan later in the year and test ride a bullet train.


[BUSINESS NEWS]
Saturday, May 16, 2009
Eco-points stimulus plan kicks off
290 billion subsidy program to encourage purchases of energy-efficient home electronics

(Kyodo News) Tapping into the environmental friendliness trend, the government launched an economic stimulus program Friday aimed at boosting demand for energy-efficient home electronics products.

As one of the pillars of an economic stimulus package adopted earlier by the government, the 290 billion subsidy program effective through next March features so-called eco-points worth 1 each that will be given to consumers who purchase certain household appliances that meet energy-efficiency criteria.

Although currently the points can't be used, the government plans to announce more details of the program before the summer bonus season in early July, officials said.

In addition to energy-efficient refrigerators and air conditioners, purchases of terrestrial-digital television sets are also subsidized, apparently in an attempt to assist a government drive to digitize the country's TV broadcasts by July 2011.

Consumers receive eco-points worth 5 percent of the price of the air conditioners and refrigerators and about 10 percent of those of the televisions, some of which are worth as much as 36,000 points.

Details of the campaign, which runs through next March, will possibly be released next month after the Diet passes a supplementary budget for the current fiscal year to fund the program.

On Friday, electronics stores nationwide banking on the latest subsidy program started labeling about 2,000 products as eligible for the program.

Consumers are required to submit their receipts and product guarantees to the program's office to obtain eco-points.

The government plans to formally set up the office after the Diet approves the budget. All details concerning the program will be discussed within the office, government officials said.

The government has yet to announce which goods and services consumers will be able to exchange the points for, but said it is considering things such as other appliances, coupons that can be used throughout the country and prepaid cards for public transportation.

It may be as early as summer that consumers can start exchanging their points, the officials said.

Manabu Fukuchi, senior consultant on energy and environment at Nomura Research Institute, said the program is likely to fall short of immediately boosting demand and consumption.

news.notes20090516b

[TODAY'S TOP STORIES] from [The Japan Times]

[NATIONAL NEWS]
Saturday, May 16, 2009
Lack of fireworks as DPJ rivals' debate ends in a tie

By MASAMI ITO and KAZUAKI NAGATA
Staff writers

Yukio Hatoyama and Katsuya Okada, the two candidates in the Democratic Party of Japan's presidential election Saturday, both stuck to the party line in a public debate in which the only way they seemed to differentiate themselves from each other was in their choice of ties.

The two were apparently wary of media reports that the election may divide the party just when it needs to unite for the general election that must come by fall.

Having been President Ichiro Ozawa's right-hand man as party secretary general, Hatoyama and his supporters are naturally considered pro-Ozawa, while Okada, who had distanced himself from the departing chief, is gaining encouragement from the anti-Ozawa clan.

According to media reports, support for the candidates is evenly split, with the focus being on whether DPJ members are for or against Ozawa, who earlier this week announced his resignation after coming under fire over over his chief secretary's arrest in a political funds scandal.

As if to dispel the image that the party is split down the middle, Hatoyama, said at the debate held at the Japan National Press Club in Tokyo that both he and Okada share a common enemy in the Liberal Democratic Party.

"We are fighting not against each other but rather Prime Minister Taro Aso and his government," Hatoyama said. "In other words, this is a battle for change . . . we must thoroughly clean up the old political structure taken by the LDP-New Komeito ruling bloc."

Throughout the debate, both Okada and Hatoyama agreed that power and money must be shifted from the central government to local authorities and all contributions from corporations to politicians or political parties, which have often been likened to bribery, should be banned by law.

Banning corporate donations "is especially a major difference between the LDP and the DPJ and we stressed this point together," Hatoyama said.

The two lawmakers admitted their policies are in the main the same.

"There is no major difference in our policies because we are both from the DPJ," Okada said, stressing that the party's presidential race is the preliminary stage for the next general election, in which the DPJ is hopeful of seizing control of the government from the ruling coalition.

While opinion polls show that Okada is the favorite, Hatoyama reportedly has more internal party support, which could be the key in Saturday's poll as only DPJ Diet members have the right to vote.

Hatoyama came out and said he would include Okada in the DPJ leadership if he is elected president. Okada, on the other hand, refused to elaborate, but did stress he intended to cooperate with Hatoyama and Ozawa if chosen as leader.

Party unity will be formed "easily as long as Hatoyama and I firmly cooperate after the race and aim to oust" the LDP, Okada said. "And not only the two of us. Naturally, we need to play ball with many of the party leaders, including Ozawa and Kan, to achieve this goal."

In the end, their only clear difference was their ties — Okada, a known advocate of environmental issues, sported a bright green one, while Hatoyama, stressing the word "love," went for fiery red.

Later Friday evening, the two candidates visited the Yurakucho shopping district in Tokyo, in their only opportunity to appeal directly to the public.

The two took the opportunity to attack the LDP and Aso's government.

Hatoyama said many people are currently experiencing difficult times, including elderly who cannot get medical services due to financial difficulties and young married couples who hesitate to have children due to the high expense their upbringing entails.

"Who is responsible for the current state of Japan? How did the country get like this?" Hatoyama asked.

Okada noted that since Junichiro Koizumi stepped down as prime minister in 2006, the LDP has changed prime minister every year without holding an election.

"The (LDP) lawmakers lack a firm resolve to serve as prime minister," he said.

Nishimatsu scandal
(Kyodo News) Nishimatsu Construction Co. said Friday that President Tadashi Ishibashi will step down over a political fund scandal involving Ichiro Ozawa, who has resigned as president of the Democratic Party of Japan.

Director Harusada Kondo will succeed Ishibashi, the company said. The appointment is to take effect June 26.

The scandal involves Ozawa's top secretary, who was indicted in March for receiving millions of yen in donations from Nishimatsu, in violation of the Political Fund Control Law.


[BUSINESS NEWS]
Saturday, May 16, 2009
Japan Tobacco sees gain in Russia

LONDON (Bloomberg) Japan Tobacco Inc. said Thursday Russian sales are rising as taxes force up the prices of budget competitors to its Winston and LD brands.

Cigarette volumes in Russia climbed 1.5 percent from January to March, Executive Vice President Masakazu Shimizu said at a press conference in London. "People are starting to trade up from the value segment" as prices rise, he said. "When people who used to belong to higher pricing products are trading down, we have the expansive presence in the midpricing zone to catch them."

Taxes on tobacco are being increased incrementally until 2011 in Russia, where 42 percent of the population smokes, according to Japan Tobacco. Tax currently accounts for around one-third of the retail price on filtered cigarettes in the country. Japan Tobacco includes Russia in its Rest of the World unit, which accounted for 17 percent of sales last business year.

Japan Tobacco's U.K. market share rose to 39.2 percent in April from 38 percent a year earlier, the company said.


[BUSINESS NEWS]
Saturday, May 16, 2009
Segway Japan looks to companies to boost two-wheeled vehicle sales

(Kyodo News) Segway Japan Ltd. plans to expand sales of its Segway personal transporter electric vehicles to Japanese companies to more than 1,000 units by the end of March 2012, up from about 300 units it hopes to sell this business year.

The two-wheeled, self-balancing vehicles — priced at \935,000 for the basic model — are used at sightseeing resorts, golf courses, factories and warehouses.

The company took over sales in Japan of the vehicle, which was invented in the United States, from SGI Japan Ltd. last month.

In Japan, the vehicle cannot yet be used on public thoroughfares and has not achieved widespread sales.

Segway Japan President Hiroshi Otsuka said at a news conference Thursday he would like to urge the government to allow the vehicles to be driven on walkways, as in some places in Europe and North America.

James Norrod, president of U.S.-based Segway Inc., which exports the scooter to Japan, also took part in the press conference in Yokohama.

Regarding the two-seat electric vehicle PUMA that Segway and General Motors Corp. are developing, Norrod said the project can tap the two firms' technologies.

news.notes20090516c

[Today's Paper] from [Los Angeles Times]

General Motors moves to shed 1,100 dealers
GM takes action in a restructuring plan that would shrink its distribution network from 6,000 to 3,600 by the end of 2010. The company is trying to avoid bankruptcy.

By Ken Bensinger, Andrea Chang and Tiffany Hsu
May 16, 2009

The painful reshaping of the American auto industry hit home this week, delivered overnight by FedEx and UPS.

Over the last two days, General Motors Corp. and Chrysler moved to cull nearly 2,000 of their dealers, with at least 1,000 more to come. And Chrysler indicated that it was likely to break its contracts with hundreds of parts suppliers, setting the stage for yet another blow to American manufacturing.

The sweeping cuts were a reminder that the decades-long decline of the U.S. automakers truly does affect the nation as a whole. Dealer groups estimate that the moves could cost 100,000 jobs and billions in state and local tax revenue. That's not even counting the $23 billion in federal loans to GM and Chrysler that taxpayers may never see repaid.

"This is the price of restructuring. It hits home everywhere," said Thomas Klier, senior economist at the Federal Reserve Bank of Chicago. "Every town has a car dealership. That's what was left out of this when the debate about the auto industry started."

On Friday, GM informed 1,100 of its 6,000 dealers by overnight letters that it would not renew their franchises come October of next year, giving them 18 months to wind down their businesses. The company has said that as many as 500 more dealers would get the ax next month.

A day earlier, Chrysler asked a bankruptcy judge to cancel the franchises of 789 of its 3,200 dealers, a process that leaves them without legal recourse and could stick them with millions of dollars in unsold inventory when they close in just four weeks. Chrysler, too, indicated that more cuts could come soon.

Unlike Chrysler, GM didn't publish a list of the dealers it was getting rid of, so a complete regional tally isn't known. Although dozens of California dealers were expected to be named, only a few spoke out Friday.

Bill Hatfield, owner of Hatfield Buick GMC in Redlands, said he felt a sense of dread as he watched a FedEx truck pull up to his showroom.

"It's a little bit like a death -- you know one's coming, or you're worried one's coming, but when it comes it's still a hell of a shock," he said.

Inside was the dreaded letter, telling him the automaker saw no future for his 96-year-old dealership. It survived the Great Depression and two World Wars, but not the restructuring of the U.S. auto industry.

"Many people bought their cars here because they knew I would take care of them -- now it's like I'm abandoning them," said Hatfield, who is considering opening a used-car lot if he can't save his store.

Although the cuts came to small towns and big cities alike, Paul Taylor, chief economist of the National Automobile Dealers Assn. said the hardest-hit areas appear to be suburban communities and mid-size markets. Those are the kinds of places, he said, that rely heavily on the spending, employment and tax revenue a dealer provides.

He estimates that the average dealer employs close to 50 people and pumps $16.5 million a year into the local economy, including payroll, taxes, payments to vendors, advertising and charitable giving. All told, tens of billions of dollars of regional spending could be lost.

"It's a horrendous story," Taylor said, "one we argue is unnecessary."

His group and targeted dealers say that getting rid of dealers won't solve the serious problems confronting GM and Chrysler, which have teetered on the brink of failure since last summer, with Chrysler filing for bankruptcy two weeks ago. They contend instead that cutting franchises may simply cost them even more sales.

The automakers say they have far too many dealerships to continue in a market where sales are down more than 40% from levels just two years ago. They also claim that having too many dealers makes their showrooms unprofitable and uncompetitive.

GM said that although the targeted franchises represented 18% of its dealer body, they accounted for only 7% of its sales. Chrysler said the dealers it was cutting produced only 14% of its sales despite representing a quarter of its sales network.

As a result, GM plans to shed 42% of its distribution network by the end of 2010, leaving it with 3,600 dealers. Chrysler's cuts give it about 2,400.

"There's not enough industry," said Steven Landry, Chrysler's head of North American sales and marketing. "It's a situation that allows us to fix a lot of things."

Allan Rose, co-owner of Rose Buick Pontiac GMC in Gloversville, N.Y., didn't suspect that he was part of the problem. Although his northern New York dealership is small, it's the only one of its kind for more than 30 miles in every direction, clear to the Canadian border. But he too got a FedEx letter.

"Even though I felt we have done a very good job for General Motors, there's never a knowledge why they do things," Rose said. "It just didn't seem logical . . . that they would elect to not re-contract with us."

While dealers such as Rose spoke up Friday, hundreds of others kept quiet, trying to figure out whether they would stay in business until their contracts expire in October 2010 or attempt to get out sooner.

"There's just a lot of confusion right now," said Marty Brill, an attorney who represents auto dealers at Los Angeles firm Levene, Neale, Bender, Rankin & Brill.

He said several targeted dealers called Thursday and Friday to ask about their legal options, while others worried that even though they weren't named, GM could follow Chrysler into bankruptcy soon, opening the door for more cuts.

The potential for cuts among supplier ranks came in Bankruptcy Court in New York on Friday, when Chrysler named roughly 900 vendors with which it planned to continue doing business. That left some 300 Chrysler suppliers in limbo, with no guarantees for the future.

"Some contracts will not be assumed," Chrysler spokesman Max Gates said.

At Kirby Jeep in Ventura, the news came Thursday in a UPS envelope: Its franchise contract with Chrysler would be broken in that same New York courtroom June 9. The showroom has been in its location for 43 years.

"I've got a parts guy who's been here for 36 years and a service guy who has been working on Jeeps for at least 20 years," said Jeff Kennedy, the general manager. "Our service bays are full of customers who come here out of loyalty long after their warranties expire.

"We're going to do everything we can to survive," he said. "We're not dead yet."

news.notes20090516d

[Today's Paper] from [The New York Times]

Minorities Hit Hardest by Foreclosures in New York

By MICHAEL POWELL and JANET ROBERTS
Published: May 15, 2009

Turn the corner on 145th Street in Jamaica, Queens, and it is as though a cyclone has wheeled through.

One resident, Lakisha Brown, a hospital worker and mother of two, snatched her house back from foreclosure last month, if only temporarily. “We need to sell fast,” she says. “I’m just trying to save what’s left of my credit.” Across the street in this black middle-class neighborhood, Patrick Nicholas, a surgical technician in blue scrubs, shakes his dreadlocks and shrugs. He rents but is moving out. “The owner got foreclosed and told us to leave,” he says.

Six doors away, past two foreclosed and boarded-up homes, a burly man in a blue union jacket declines to give his name but his problem is evident. A foreclosure notice is pasted to the door of his house. His tone is mournful. “Tough times, man,” he says. “Tough, tough times.”

Late to arrive in the Northeast, the foreclosure crisis has swept through the New York region at an explosive pace in the past two years, destroying billions of dollars in housing wealth, according to a New York Times analysis of foreclosures filed since 2005 and federal mortgage data.

It now touches every corner of the region, from estates along the Connecticut Gold Coast to the suburban tracts of Long Island, where 6 percent of all mortgages are at least 90 days delinquent, the point at which foreclosure proceedings usually begin.

But the storm has fallen with a special ferocity on black and Latino homeowners, the analysis shows. Defaults occur three times as often in mostly minority census tracts as in mostly white ones. Eighty-five percent of the worst-hit neighborhoods — where the default rate is at least double the regional average — have a majority of black and Latino homeowners.

And the hardest blows rain down on the backbone of minority neighborhoods: the black middle class. In New York City, for example, black households making more than $68,000 a year are almost five times as likely to hold high-interest subprime mortgages as are whites of similar — or even lower — incomes.

This holds a special poignancy. Just four or five years ago, black homeownership was rising sharply, after decades in which discriminatory lending and zoning practices discouraged many blacks from buying. Now, as damage ripples outward, black families in foreclosure lose savings and credit, neighbors see the value of their homes decline, and renters are evicted.

That pattern plays out across the nation. A study released this week by the Pew Research Center also shows foreclosure taking the heaviest toll on counties that have black and Latino majorities, with the New York region among the badly hit.

On 145th Street in southeast Queens, just south of Linden Boulevard, attached brick homes with tidy, fenced-in gardens stretch into the distance. Children play tag under blooming oaks. But 8 of these roughly 50 homes face foreclosure; 4 are vacant; 2 have plywood boards nailed over punched-out windows.

“My district feels like ground zero,” said City Councilman James Sanders Jr., an African-American who represents hundreds of blocks in Queens like this one. “In military terms, we are being pillaged.”

Years ago many banks drew red lines on maps around black neighborhoods and refused to lend; more recently, some banks began taking aim at those neighborhoods for the marketing of subprime loans, say consumer advocates.

Black buyers often enter a separate lending universe: A dozen banks and mortgage companies, almost all of which turned big profits making subprime loans, accounted for half the loans given to the region’s black middle-income borrowers in 2005 and 2006, according to The Times’s analysis. The N.A.A.C.P. has filed a class-action suit against many of the nation’s largest banks, charging that such lending practices amount to reverse redlining.

“This was not only a problem of regulation on the mortgage front, but also a targeted scourge on minority communities,” said Shaun Donovan, the secretary of Housing and Urban Development, in a speech this year at New York University. Roughly 33 percent of the subprime mortgages given out in New York City in 2007, Mr. Donovan said, went to borrowers with credit scores that should have qualified them for conventional prevailing-rate loans.

For anyone taking out a $350,000 mortgage, a difference of three percentage points — a typical spread between conventional and subprime loans — tacks on $272,000 in additional interest over the life of a 30-year loan.

“There’s a huge worry that this will exacerbate historic disparities between the wealth of black and white families,” said Ingrid Ellen, co-director of the Furman Center for Real Estate and Urban Policy at New York University. Not that white neighborhoods and towns in the New York region stand immune. During the past decade, buyers of all colors scrimped to buy homes in one of the nation’s most expensive housing markets.

Now mortgage delinquencies are rising sharply even in high-income, predominantly white enclaves, from Nirvana Avenue in Great Neck, N.Y., to Otter Rock Drive on a peninsula off Greenwich, Conn.

In the wealthiest ZIP codes, the median delinquency rate — although much lower than the regional rate, 5.3 percent — more than tripled from March 2005 to March 2008, then doubled again in the year since.

As a whole the region has fared better than stretches of Florida and California, where about one in every five borrowers is at least 90 days behind on payments.

Yet the pain in the New York region is considerable. The delinquency rate in Essex County, N.J., stood at 11 percent in March, more than two percentage points higher than in Genesee County, Mich., home to the battered city of Flint, which stands as a national symbol of this recession.

A World of Damage

Sitting on Long Island close by the Atlantic Ocean — salt air flares the nostrils on many days — Roosevelt is 79 percent black and has suffered grievously from segregation over the years. (Long Island, as measured by school and housing patterns, is among the most racially segregated suburban areas in the nation.) Still, as young black families sought bargains, home ownership rose.

Now subprime loans and a crippled economy have laid many of those families low. Olive M. Thompson, a 45-year-old nursing assistant, lost her $215,000, four-bedroom Cape in January, but not before she drained her 401(k) and declared bankruptcy.

A single mother of four, she recalled arriving in 2003 and seeing a home across the street with a garden so beautiful she fantasized about matching it. That house went into foreclosure.

“Next thing I know, it’s boarded up,” she said.

Foreclosure represents catastrophe on several levels. As families move to cheaper quarters, they often move their children to different schools. A rising number of foreclosures in a neighborhood is a singularly reliable predictor of an increase in violent crime, according to a recent academic study.

All these ills are magnified for black families, whose median net worth is far smaller than that of white families, and far more tied up in housing.

On Bainbridge Street in the predominantly black Bedford-Stuyvesant section of Brooklyn, 130-year-old brownstone homes loom like grand sailing ships, seemingly impervious to the ravages of time. That solidity is illusory. Looking closer, a visitor can identify homes in jeopardy by the cracked stoops, broken windowsills and tilting chimneys.

Alexia Billiart, 33, who is black, and her husband, who is white, moved a year ago from an expensive neighborhood into a handsome row house in Bedford-Stuyvesant, where they can manage their payments. Across the street, two foreclosed homes have fallen vacant, and a nearby apartment building stands broken and padlocked. At night, young men cluster on the stoops of the vacant homes.

“We figured we’d move here and participate in the rebirth of this block,” said Ms. Billiart, who works for a financial planning firm. “It seems to be going backward; it’s a little scary.”

Several black homeowners along these blocks, including well-paid professionals, confide that they pay strikingly high mortgage rates — 9, 10 or 11 percent annually. How that came to happen is a complicated story.

Over the last decade, many commercial banks, from Wells Fargo to Bank of America to HSBC, acquired subprime lenders that thrived by offering loose lending standards and high interest rates. Court records show that brokers sometimes received bonuses for steering borrowers into high-interest loans laden with extra costs.

Even many blacks and Latinos who say they sought conventional loans ended up with subprime mortgages from these lenders. One reason, many say, was a mistrust of conventional banks.

Colvin Grannum grew up in a black neighborhood in Brooklyn and became president of the Bedford-Stuyvesant Restoration Corporation, a nonprofit organization that builds and renovates housing. His father bought several properties in the 1950s and ’60s, often without turning to banks.

“I don’t want to say it’s in the cultural DNA, but a lot of us who are older than 30 have some memory of disappointment or humiliation related to banks,” Mr. Grannum said. “The white guy in the suit with the same income gets a loan and you don’t?”

“So you turn to local brokers, even if they don’t offer the best rates.”
continued on 20090516e

news.notes20090516e

[Today's Paper] from [The New York Times]

Minorities Hit Hardest by Foreclosures in New York

By MICHAEL POWELL and JANET ROBERTS
Published: May 15, 2009

continued from 20090516d

This may help explain an unusual phenomenon: Upper-income black borrowers in the region are more likely to hold subprime mortgages than even blacks with lower incomes, who often benefit from homeownership classes and lending assistance offered by government and nonprofits.

The foreclosure storm shows few signs of abating. Scam artists and deed thieves prey on the desperate as complaints flood the offices of local prosecutors. In a church meeting room in the Guyanese neighborhood of Flatlands, Brooklyn, 200 homeowners tell of paying $3,000 or $4,000 to firms to “fix” their mortgage troubles. Often, these firms disappear with the money.

The foreclosure storm shows few signs of abating. Scam artists and deed thieves prey on the desperate as complaints flood the offices of local prosecutors. In a church meeting room in the Guyanese neighborhood of Flatlands, Brooklyn, 200 homeowners tell of paying $3,000 or $4,000 to firms to “fix” their mortgage troubles. Often, these firms disappear with the money.


[Today's Newspaper] fom [The Washington Post]

CIA Chief Rebuts Pelosi's Charges
Panetta Says Lawmakers Were Told About Use of Interrogation Methods

By Perry Bacon Jr. and Joby Warrick
Washington Post Staff Writers
Saturday, May 16, 2009

CIA Director Leon Panetta yesterday rejected House Speaker Nancy Pelosi's charge that the agency misled her about its use of coercive interrogation methods, escalating a controversy that has dogged the speaker for weeks and intensifying a debate over Bush administration policies that the Obama administration has tried to avoid.

Panetta, whom President Obama tapped to lead the CIA this year, reasserted the agency's claim that it told congressional leaders about the use of such methods during a closed-door briefing in September 2002.

Pelosi (D-Calif.) has acknowledged attending the briefing but says she was told only that the CIA was considering the use of waterboarding, a technique that simulates drowning.

"It is not our policy or practice to mislead Congress," Panetta said in a message meant to shore up employees of his agency, which is at the center of a relentless political firestorm over Bush policies and the Iraq war. "Our contemporaneous records from September 2002 indicate that CIA officers briefed truthfully on the interrogation of [terrorism suspect] Abu Zubaida, describing the 'enhanced techniques that had been employed.' "

The dispute over Pelosi's knowledge of the interrogation techniques leaves the Obama administration caught between the speaker, a strong advocate of the president's agenda on Capitol Hill, and the CIA, an agency Obama has defended even as he has described its interrogation methods as torture and released Justice Department memos that drew more focus on those methods.

The president, however, has also strongly resisted calls for the creation of a truth commission, something Pelosi has vocally supported. Such a panel, Obama has said, would devolve into partisan finger-pointing.

The White House saw no value in weighing in on Pelosi and the CIA yesterday. Spokesman Robert Gibbs declined to comment at his daily briefing, telling reporters, "I appreciate the invitation to get involved, but I'll decline to RSVP."

Meanwhile, an administration ready to tackle campaign priorities such as health care and climate change remains mired in issues left over from the Bush administration. Besides the debate over interrogations, Obama continues to wrestle with how to handle detainees at the U.S. prison at Guantanamo Bay, Cuba, a facility he ordered closed by next year. This week he drew fire from the American Civil Liberties Union and others after reversing his support for the release of additional photos of prisoner abuse, and for his announcement yesterday that he will retain and revamp the system of military tribunals to try detainees.
Some liberal activists have said the controversy over what Pelosi knew illustrates the need for a commission to investigate alleged abuses of the Bush administration.

A day after she accused the CIA and the Bush administration of "misleading the Congress," Pelosi defended her charge that she had not been properly briefed, but sought to blame the Bush administration instead of the CIA.

"We all share great respect for the dedicated men and women of the intelligence community who are deeply committed to the safety and security of the American people," Pelosi said in a statement released by her office. "My criticism of the manner in which the Bush Administration did not appropriately inform Congress is separate from my respect for those in the intelligence community who work to keep our country safe."

Republicans continued their weeks-long attack on Pelosi. The office of House Minority Whip Eric Cantor (Va.) circulated comments noting her previous praise of the CIA. Radio show host Rush Limbaugh called for her resignation.

Pelosi's position as speaker seems secure for now, as no Democrat has publicly criticized her stance. Instead, Democrats lined up behind the woman they elected as the first female speaker of the House in 2007.

Former senator Bob Graham (D-Fla.), who was chairman of the Senate intelligence committee in the period after the attacks of Sept. 11, 2001, said CIA officials did not brief him on the use of waterboarding in 2002. And he questioned whether information provided by the CIA on the content of the briefings was accurate, claiming that in three instances agency officials said he attended briefings on days that his personal journal shows he did not.

"That raises some questions about the bookkeeping of the CIA," Graham said on MSNBC.

Congressional Democrats said they trust the speaker's version of events.

"I'm sure Karl Rove is proud that the Republicans found a way to criticize Nancy Pelosi for not doing enough to stop the same illegal practices that they supported and continue to defend," said Rep. John Yarmuth (Ky.). "It's clearly a desperate attempt to find any political traction with an American public that has given up on them."

Looking to blunt GOP attacks, Pelosi's office circulated comments throughout the day from Democrats defending her, as well as previous remarks by House Minority Leader John A. Boehner (R-Ohio) questioning the judgment of the CIA. The speaker's office arranged for several members of Congress to appear on television and defend Pelosi, who spent the day at a fundraising event in Arizona for Democratic women running for office.

But Panetta, a former Democratic congressman from California who served in the House with Pelosi, stood by his agency and urged CIA employees not to be distracted by the controversy.

"Ignore the noise and stay focused on your mission," he said in his memo. "There is a long tradition in Washington of making political hay out of our business. It predates my service with this great institution, and it will be around long after I'm gone."

news.notes20090516f

[Today's Papers] from [Slate Magazine]

Nobody's a Hero

By Lydia DePillis
Posted Saturday, May 16, 2009, at 5:44 AM ET

The New York Times leads with an analysis of how the wave of foreclosures that reached New York last is breaking particularly hard on minority homeowners. Defaults occur three times as often in mostly minority census tracts as in mostly white ones, often those targeted by banks for subprime loans, subprime loans, leaving them wide open for damage when the market collapsed. The Washington Post leads with the latest in the case of What Nancy Knew—in this episode, CIA director Leon Panetta rejected Speaker Pelosi's claim that his agency had not properly briefed Congressional leaders in late 2002 about interrogation techniques at Guantanamo Bay. The Wall Street Journal tops its world-wide newsbox with the results of a report from the Securities and Exchange Commission's inspector general, which found that two employees traded stock in companies under investigation by the agency, violating its insider trading rules. After coming under fire for a failure to detect Bernie Madoff's gigantic Ponzi scheme, the paper calls it a "potential scandal" that the SEC can ill afford. The Los Angeles Times leads with the news of 1,100 General Motors dealerships being put on notice, via letters sent overnight Thursday, that the company would not be renewing their licenses. As many as 500 more could get the ax soon, which--along with nearly 800 dealerships terminated by Chrysler yesterday--amounts to about 100,000 jobs lost.

Accusations and conflicting accounts continue to fly in the CIA interrogation techniques kerfuffle. Former Sen. Bob Graham backs Pelosi, saying that the CIA did not adequately inform members of the Intelligence Committees of what techniques were being used on detainees at Guantanamo, while former CIA director and former Rep. Porter Goss said they were. Either way, it's like Kryptonite for the otherwise-durable Pelosi, although the NYT calls it "undisputed fact" that even if she had been fully knowledgeable about what was going on in September 2002, she would have been relatively powerless to stop it.

In another disappointment for left-leaning Washington watchers, Obama's expected announcement that he would continue to try terrorism suspects through the military commissions—which exclude certain types of evidence from consideration by the defense—drew cries of outrage from civil rights groups. Of course, there's also a considerable political upside for the President as well, from conservatives who would rather see him take a hard line on terrorism. Both the Post and the NYT hammer home how much the idea of retaining even "revamped" military commissions departs from Obama's campaign rhetoric, which had articulated a sharp break from the practices of the Bush administration—along with the decision to not release photos of detainees at Guantanamo, this is an attempt to argue that justice may be compromised in the interest of national security.

The Post fronts an investigation into the lobbying gears behind millions of dollars budgeted for computerization of medical records—generally agreed to be a progressive step, but one which will also pour money into the coffers of the companies that produced the studies used to make the argument for the program, which Office and Management and Budget director Peter Orszag has since called "overly optimistic."

But any impropriety in that, and even the troubles over at the SEC, pale in comparison to the British Parliament's more garden-variety corruption, which exploded onto the front pages of the London Daily Telegraph this week. Representatives have made a common practice of charging the gamut of personal expenses to the crown, from flat screen televisions to piping under a tennis court. It's rattling a nation already mired in a deep recession, and has already claimed one official's job, with possibly more to come. Of the papers to comment, the Journal takes perhaps most joy in the telling, placing this dust-up in the context of Parliament's long history of indiscretions—although this time, "the scale of the cupidity is astonishing."

Falling gas prices are bad news for Russia, the NYT reports, which has gone from riding high with revenues rolling in as energy prices climbed ever higher to having to close wells for lack of income. And they're stuck, at least for now--Gazprom negotiated contracts with central Asian nations at prices far above what they've fallen to today, forcing the energy utility to sell gas at a loss. But oil may help grease the gears of Cuba's economic integration with the U.S.—ten to 15 billion barrels of crude are buried underneath 5,000 feet of seawater and 20,000 feet of rock off the island's northwestern coast. Already, familiar arguments about how it might aid the rickety Castro regime are surfacing; even such an attractive deal wouldn't slide very fast through such a Cuba-phobic Congress.

In the interest of dealing with all that oil's end product, the Post has a rundown of (and the other papers ignore) the climate bill reported out of Rep. Henry Waxman's Energy and Commerce committee yesterday. It's begging to pass, already packed full of concessions and exemptions—carbon allowances under an overall cap that will be gradually lowered are to be largely given away to utilities and energy-intensive industries, rather than auctioned.

Supreme Court chatter continues with a look at a potential replacement for David Souter—Diane Wood, who has President Obama's desired empathy in spades, if her stances in opposition to the curmudgeonly conservatives of the 7th Circuit Court are anything to go by. Mostly though, the LAT explains, Obama just wants to avoid a headache over abortion and gay marriage. (It doesn't look promising.)

In other stories that won't go away, it seems that Swine Flu hasn't yet run its course. Federal health officials are noticing that the normal flu system didn't end when it normally would have, and half the flu cases are testing positive for the swine flu virus.

The Journal reports from the trenches of the yuppie recession—Portland, Ore., along with places like Seattle and Austin—where young college grads just keep moving, seeking to write or play music or farm, only to find that the jobs dried up long ago. Buick dealers and happy hipsters, all in the same boat!

news.notes20090516g

[Today's News] from [The Guardian]

Labour MPs who cheat on expenses will be deselected
• PM gives Monday deadline to log claims
• Malik is first minister to step down

Patrick Wintour and Nicholas Watt
guardian.co.uk, Friday 15 May 2009 22.14 BST
Article history

Any Labour MP found to have made improper expenses claims will be ­automatically deselected and barred from standing at the next general election as the party desperately tries to overcome the constitutional crisis facing parliament.

The Guardian has learned that the ­radical proposal is expected to be agreed next week by Labour's national executive, a move that acknowledges the deep anger among voters to the escalating scandal over MPs' claims.

Gordon Brown has also given ministers a Monday night deadline to ensure their expenses claims for the past five years are lodged with the parliamentary authorities and ready for publication.

Any deselection would happen after the parliamentary commissioner for standards had ruled that an MP had been found clearly guilty of improperly claiming.

The prime minister, who is expected to give a major TV interview on Sunday, is to resist a more sweeping grassroots proposal from leftwing NEC members that would compel every sitting Labour MP to go though a fresh selection process so the public can be reassured all candidates are "fit and proper persons" to stand at the election. Labour officials met and said such a move would be unfair.

In another rollercoaster day which saw the first ministerial casualty of the affair and signs of simmering public anger, Scotland Yard and the Crown Prosecution Service announced they were setting up a joint panel to consider multiple allegations that MPs have broken the law in their expenses claims. The police said they were acting because they had received so many complaints from the public.

In other key developments:

• A second Labour backbencher, David Chaytor, was forced to concede tonight that he had claimed £13,000 in expenses to cover mortgage interest payments on his London flat after the mortgage had been paid off. Downing Street said Chaytor was likely to be interviewed by Nick Brown, the chief whip, and face suspension from the parliamentary party along with a similar backbench offender Elliot Morley. Chaytor said he had made an unforgivable error and would repay the money.

• Lord Foulkes, a close friend of the Speaker, Michael Martin, gave a broad hint that Martin had decided to resign before the election, saying it was logical for him to do so by then.

• Shahid Malik, the justice minister, was forced to stand down from his post by Brown pending an investigation into whether an allegedly subsidised rental of a home in his Dewsbury constituency ­represented a breach of the ministerial code. He is the first minister to be disciplined since the allegations started, but last night won the support of his local party.

• William Hague, the Tory deputy leader, revealed he was going to divest himself of the vast bulk of his outside interests, a decision that will put pressure on the other shadow cabinet members.

• David Cameron, battling to keep abreast of public anger over the allegations of sleaze, told his Scottish Tory party that this was a time of "great danger" for democracy in the UK.

• The deputy leader of the house, Chris Bryant, was forced to deny stories that he had flipped his second home.

• The former father of the house, Tam Dalyell, was accused of attempting to charge £18,000 for two bookcases two months before he stood down as an MP in 2005.

The furore surrounding Malik forced Brown to act early yesterday. It was alleged Malik should have declared on the ­ministerial register that the rent on his constituency home was below the market rate, so making him potentially beholden to the landlord. The prime minister told him to step down after discussions with the cabinet secretary, Sir Gus O'Donnell, and the justice secretary, Jack Straw. The true market value of the rent of the home was a matter of dispute, and some ­ministers said Malik had been made a ­sacrificial lamb. He said he would return to the government with his head held high.

Morley, the former minister suspended from the parliamentary Labour party on Thursday, said he might quit as the MP for Scunthorpe over the issue. He said: "What matters to me is the view of my local people and my local party. I need to talk this through with them."

Similar signs of a grassroots rebellion were emerging in the Tory party, with two-thirds of those polled on the Conservative Home website urging the Tory MP Andrew Mackay, to quit over his expenses claims.