AP News in Brief
AP IMPACT: US pins economy’s hopes on same bank execs who went from boom to bust to bailout
WASHINGTON (AP) — They’ve been bailed out, but not kicked out. At banks that are receiving federal bailout money nearly nine out of every 10 of the most senior executives from 2006 are still on the job, according to an Associated Press analysis of regulatory and company documents.
The AP’s review reveals one of the ironies of the bank bailout: The same executives who were at the controls as the banking system nearly collapsed are the ones the government is counting on to help save it.
Even top executives whose banks made such risky loans they imperiled the economy have been largely spared any threat to their jobs, as Washington pumped billions in taxpayer money into the companies. Less fortunate are more than 100,000 bank employees laid off during a two-year stretch when industry unemployment nearly tripled, bank stocks plummeted and credit dried up.
“The same people at the top are still there, the same people who made the decisions causing a lot of our financial crisis,” said Rebecca Trevino of Louisville, Ky., a mother of three who was laid off from her job as a Bank of America training coordinator in October. “But that’s what tends to happen in leadership. The people at the top, there’s always some other place to lay blame.”
That workers and managers experience a recession differently is hardly a surprise. What’s new is that taxpayers are now shareholders in the nation’s bailed-out banks, yet they lack the usual shareholder power to question management decisions or demand house-cleaning in the executive suites.
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Obama to meet with Republicans in Congress as he seeks bipartisan economic stimulus plan
WASHINGTON (AP) — President Barack Obama is making good on his promise to hear from Republicans as he pushes for swift passage and bipartisan backing of his massive $825 billion plan intended to jerk the country out of recession.
The unanswered question: whether the new Democratic president will actually listen to GOP concerns about the amount of spending and the tax approach — and modify his proposal accordingly.
With the economy worsening, Obama was making his first trip to Capitol Hill since his swearing-in last week for two private afternoon sessions Tuesday with House and Senate Republicans.
“The goal is to seek their input. He wants to hear their ideas,” White House press secretary Robert Gibbs said. “If there are good ideas — and I think he assumes there will be — we will look at those ideas.”
“I think the president is genuinely serious about this,” Gibbs added.
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Israeli military: Troops, militants clash along Gaza border for first time since cease-fire
JERUSALEM (AP) — Palestinian militants detonated a bomb next to an Israeli army patrol near the Gaza Strip on Tuesday and Israeli soldiers quickly crossed the border in search of the attackers in the first serious clash since a cease-fire went into effect more than a week ago.
Heavy gunfire was audible along the border in central Gaza and Israeli helicopters hovered in the air, firing machine gun bursts, Palestinian witnesses said. The Israeli military said the bomb targeted an Israeli patrol near the border community of Kissufim but would not provide further details.
There was no claim of responsibility for the attack.
An Israeli jet broke the sound barrier and set off a loud sonic boom over Gaza City not long afterward, possibly as a warning, but there were no further reports of Israeli retaliation. Since ending a punishing three-week offensive against Hamas on Jan. 17, Israel has said it will respond in force to any attack from Gaza.
Israeli troops crossed the border fence into Gaza to search the immediate area of the bombing, defense officials said. They spoke on condition of anonymity under military guidelines.
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Illinois Gov. Rod Blagojevich’s own words to come back to haunt him at his impeachment trial
SPRINGFIELD, Ill. (AP) — A day after Gov. Rod Blagojevich’s loudly proclaimed his innocence during a media blitz, the governor’s more private words are to take center stage at his impeachment trial.
The state Senate was expected Tuesday to hear secretly made wiretaps of Blagojevich allegedly discussing how he could benefit from his appointment power.
Blagojevich never denied the remarks federal prosecutors attribute to him, but insists they were taken out of context and he did nothing illegal.
The impeachment trial — the first for a U.S. governor in more than 20 years — opened Monday with House-appointed prosecutor David Ellis telling senators he will show that Blagojevich “repeatedly and utterly abused the powers and privileges of his office.”
With Blagojevich refusing to be present or mount a defense, Illinois senators could vote within days on whether to oust the 52-year-old Democrat on a variety of charges, including allegations he tried to sell or trade President Barack Obama’s vacant Senate seat for a Cabinet position, a high paying job for himself or his wife or money to bankroll his future campaigns.
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Defense Secretary Gates faces Congress eager to hear details of Obama war policy
WASHINGTON (AP) — Congress is eager to hear from Defense Secretary Robert Gates how the Obama administration plans to salvage the war in Afghanistan and hold a relative peace in Iraq — all the while reducing the stress on a force stretched thin by years of combat.
Lawmakers, set to question Gates on Tuesday, also want to hear details on the closing of the Guantanamo Bay prison, with some members of Congress concerned that their state might become the next location to house the nation’s most dangerous terrorist suspects.
“There are a lot of questions as to what victory and the redeployment out of Iraq means,” as well as plans to bolster forces in Afghanistan, said Rep. John McHugh of New York, the top Republican on the House Armed Services Committee.
President Barack Obama has vowed to shift military resources away from Iraq and move them toward Afghanistan and Pakistan, which he says is the central front in the struggle against terrorism and extremism. In a plan initiated during the Bush administration and endorsed by Obama, the Pentagon is planning to double the 34,000 contingent of U.S. forces in Afghanistan.
But expectations in the troubled region may have to be tempered as top military advisers focus on showing even small security gains and development progress quickly.
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New Treasury Secretary Timothy Geithner pledges concerted effort to attack financial crisis
WASHINGTON (AP) — President Barack Obama is directing his new economic team to move quickly to address the country’s financial crisis now that the administration’s point person in the effort has been confirmed by the Senate.
Less than an hour after Timothy Geithner won Senate confirmation, Obama came to the Treasury Department to participate in a swearing-in ceremony for the nation’s 75th treasury secretary. The event was aimed at projecting a sense of urgency on the part of the new administration in combatting the country’s deepening economic troubles.
“We cannot lose a day, because every day the economic picture is darkening, here and across the globe,” Obama told the audience assembled Monday evening in the Treasury Department’s ornate Cash Room.
The Senate voted 60-34 to put Geithner in charge of the administration’s economic team. Those who opposed the nomination said they could not accept Geithner’s explanation that his failure to pay $34,023 in self-employment taxes from 2001 to 2004 when he worked at the International Monetary Fund was an unintentional error.
“Nominees for positions that do not oversee tax reporting and collection have been forced to withdraw their nomination for more minor offenses,” said Sen. Mike Enzi, R-Wyo., noting that Geithner will oversee the Internal Revenue Service. “The fact that we’re in a global economic crisis is not a reason to overlook these errors.”
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Senate panel delving into Madoff scandal, will question regulators on SEC failures
WASHINGTON (AP) — A multibillion-dollar pyramid scheme allegedly spawned by disgraced investor Bernard Madoff is being probed by a Senate panel that will, for the first time, question federal regulators responsible for inspecting investment firms and enforcing action against violations.
The Securities and Exchange Commission has faced heavy criticism over its failure to discover the $50 billion Ponzi scheme allegedly run by Madoff, the prominent Wall Street figure and money manager now fallen into disgrace — despite credible allegations against him that were brought to the agency over the course of a decade. Against the backdrop of the worst financial crisis since the 1930s, the SEC also is accused of contributing to that disaster with lax oversight of Wall Street and the markets, and lawmakers of both parties are calling for a shake-up of the agency to help restore investor confidence.
The Senate Banking Committee was to take testimony at a hearing Tuesday from SEC Enforcement Director Linda Thomsen and the director of the agency’s inspections office, Lori Richards. Also to appear before the panel was Stephen Luparello, the interim chief executive of the Financial Industry Regulatory Authority, the securities industry’s self-policing organization.
Sen. Christopher Dodd, D-Conn., the banking panel’s chairman, recently asked Mary Schapiro — President Barack Obama’s newly confirmed chairman of the SEC — about the failure of the industry regulatory agency to detect the alleged Madoff fraud in its inspections of his brokerage operation. Schapiro, who has led FINRA as its CEO since 2006, said that the matter went undiscovered because the scheme was carried out through Madoff’s investment business and FINRA was empowered to inspect only the brokerage operation.
After acknowledging last month that staff members at the SEC repeatedly had failed since at least 1999 to fully investigate Madoff’s operations, then-SEC Chairman Christopher Cox ordered the agency’s inspector general, H. David Kotz, to determine what went wrong. Kotz told a House hearing recently that he was expanding the inquiry to examine the operations of the divisions led by Thomsen, who has been the enforcement chief since mid-2005, and Richards, who has held that position since mid-1995.
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7 just wasn’t enough: Hospital delivers only the second live octuplets birth in US history
BELLFLOWERS, Calif. (AP) — Doctors methodically delivered a mother’s seven babies, five boys and two girls, just as they had repeatedly rehearsed.
Then came the eighth.
The surprising sixth boy and eighth child made Monday’s mass birth not just remarkable but historic.
“It is quite easy to miss a baby when you’re anticipating seven,” said Dr. Harold Henry, chief of maternal and fetal medicine and one of 46 doctors, nurses and assistants who delivered the children by Caesarean section at Kaiser Permanente Bellflower Medical Center. “Ultrasound doesn’t show you everything.”
Just five minutes after the first birth, the unexpected eighth baby came out at 10:48 a.m.
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`Star Trek’ creator Gene Roddenberry and wife Majel to spend eternity together in space
LOS ANGELES (AP) — The creator of “Star Trek” and his wife will spend eternity together in space. Celestis Inc., a company that specializes in “memorial spaceflights,” said Monday that it will ship the remains of Gene Roddenberry and Majel Barrett Roddenberry into space next year.
The couple’s cremated remains will be sealed into specially made capsules designed to withstand the rigors of space travel. A rocket-launched spacecraft will carry the capsules, along with digitized tributes from fans. The Roddenberrys’ remains — and the spacecraft — will travel ever deeper into space and will not return to earth, company spokeswoman Susan Schonfeld said.
After Gene Roddenberry died in 1991, his wife commissioned Celestis to launch a part of his remains into space in 1997. She died Dec. 18, 2008.
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Andy Roddick advances after defending champ Novak Djokovic retires at Australian Open
MELBOURNE, Australia (AP) — Defending champion Novak Djokovic struggled in the heat Tuesday before retiring from his Australian Open quarterfinal against American Andy Roddick.
Roddick was leading 6-7 (3), 6-4, 6-2, 2-1 when the third-seeded Djokovic quit, maintaining Roddick’s streak of semifinal appearances at Melbourne Park every alternate year since 2003.
Djokovic had just had his serve broken to go down 2-1 in the fourth set when he went to the side of the court and told umpire Carlos Ramos he could not continue.
“The main reason is cramping and soreness in the whole body,” Djokovic said. “I think the people could see that I was struggling with movement.
“Really unfortunate way to end up my Australian Open 2009 here in this way. I really tried my best, but sometimes you can’t fight against your own body.”
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