For Media Moguls, Paydays That Outstrip Other Fields

Abstract: What’s the difference between a media mogul and a chief executive elsewhere in the business world? About $10 million in compensation, give or take. Leaders in other industries may be well paid, but as the accompanying chart shows, they earn far less than their media counterparts. Consider: the top 20 companies in the United States ranked by market capitalization include no media companies. But according to figures assembled for The New York Times by Equilar , which compiles data on executive compensation, media companies employ seven of the top 20 highest paid chief executives. The names are familiar and the numbers are large: Leslie Moonves of CBS ($60,253,647), David M. Zaslav of Discovery Communications ($49,932,867), Robert A. Iger of Walt Disney ($37,103,208), Philippe P. Dauman of Viacom ($33,396,104), Jeffrey L. Bewkes of Time Warner ($25,670,263), Brian L. Roberts of Comcast ($25,087,379), and Rupert Murdoch of News Corporation ($22,418,292). Mr. Moonves was the third highest paid executive in 2012, bested by Larry Ellison, who made $96.2 million as head of Oracle, and Robert Kotick, chief executive of Activision Blizzard, whose recently announced compensation came to $64.9 million, although much of it is in the form of stock options that vest over five years. (Activision produces video games like Call of Duty, so depending on how you define media, he might be the highest paid in the industry.) Mr. Moonves may be in a league of his own, but he is hardly the only chief executive banking hefty compensation. The data indicates that average pay of the 10 highest paid chief executives for media companies was about $30 million, more than the captains of technology or finance and other industries, who average $6 million to $14 million less. Median pay for the top 20 media executives rose 10 percent in 2012, adding to a very tall stack. Not bad for a legacy industry that is supposedly under sustained attack from insurgents and secular challenges. Many media companies file their proxy statements at the last possible minute, perhaps part of an effort to avoid ending up on annual surveys of executive compensation, like the one The Times did at the beginning of April. But now that everyone is accounted for, it’s clear that being a king in the media realm comes with a very lucrative crown. A few important caveats. The margins in the media business can be spectacular when things are going well — operating income at CBS for 2012 was $2.98 billion — which explains in part why the chief executive at Kraft, which is about the same size as CBS and had net earnings of $1.64 billion, makes $6.8 million, not $60 million like Mr. Moonves. Making cheese is fine, but running a media outfit that sells cheese through commercials is where the money is. Clearly, the market had a crush on media stocks last year. The stock price of CBS rose 42 percent in 2012 while Mr. Zaslav oversaw a 55 percent rise at Discovery. Corporate boards have employment agreements that are usually generous when the arrows on the charts are pointing sharply upward. “David’s compensation is almost entirely tied to stock appreciation,” said David C. Leavy, a spokesman at Discovery. “With the market continuing to value Discovery’s global growth prospectives, there has been tremendous value creation for shareholders.” Media companies are prospering by selling their content through all kinds of windows with some raking in cable and retransmission fees that just keep growing. Most major players drove their stock price up 30 percent or more, partly because of excellent results and generous stock buybacks. As might be expected, the vast majority of the compensation comes in the form of performance incentives, as opposed to salary. (Although some of those incentives are very generously structured.) And it would be churlish to suggest that running a huge company in an industry full of big bets, big egos and big challenges is simple. The media business requires mastering various platforms, multiple divas and, increasingly, myriad foreign markets. But approving the right projects while monetizing those assets through various channels of distribution is not akin to creating a hardware market, as Apple did, or reinventing the advertising model, as Google has. An average annual compensation of $30 million seems like an entrepreneurial reward being paid out for management execution. The compensation numbers can add up quickly, especially in an industry that is madly spinning off divisions. Companies may get smaller as they are split into discrete units — Viacom and CBS are two halves of what used to be one orange, as are Time Warner and Time Warner Cable — but the payouts continue to storm along. At Viacom, revenue dropped 7 percent in 2012, but its executives managed to get a 9 percent increase in net income. Besides Mr. Dauman’s $33.4 million in compensation, Sumner Redstone, the chairman, received $20.4 million — that’s in addition to the $31.3 million he earned at CBS — while Thomas Dooley, the chief operating officer at Viacom, received $26.3 million. Taken together, that’s big money. Image Clockwise from top left, Leslie Moonves of CBS, David Zaslav of Discovery, Philippe Dauman of Viacom and Robert Iger of Disney. Credit Clockwise from top left, Jason Kempin/Getty Images; Kevork Djansezian/Getty Images; Monica Almeida/The New York Times, and David Livingston/Getty Images. The compensation experts I spoke with said that Viacom, CBS and News Corporation have closely held two-tiered stocks controlled by their chairmen, so they can pretty much do as they wish. But their practices inflate pay for the rest of the industry. “Peer groups that include dual class stocks drive pay for others,” said Charles M. Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware. “It’s the leapfrog effect. The other guys get paid so much that even the executives that run less closely held companies benefit.” In its current proxy statement, Disney was frank about the effects of compensation contagion. “Some investors have expressed reservations about using some of these companies as a point of reference because the companies are effectively controlled by a single shareholder,” it read. “The compensation committee understands these concerns, but believes it is constrained by the competitive reality.” So, even absent a dual share structure, Mr. Iger earned $37.1 million. Zenia Mucha, a Disney spokeswoman, points out that Mr. Iger runs a much larger company than many of his media peers (more than three times the size of CBS or Viacom) and added, “Disney’s executive compensation is based on performance, and the company has delivered spectacular results during Mr. Iger’s seven-and-a-half-year tenure.” It far outperformed average stock market returns, she said. Spokesmen for the other executives whose compensation placed them in the top 20 declined to comment. Still, not everyone was applauding. Citing compensations issues, the California State Teachers’ Retirement System, or Calstrs, a large teachers’ retirement fund, voted against Mr. Iger’s nomination to the board at the company’s annual meeting in March, and a nonbinding resolution in support of the compensation package received a tepid 58 percent approval. Aeisha Mastagni, an investment officer for Calstrs, suggested that the compensation was not justified by market realities. “We took a strong position in part because it is not like he is going to leave and go to News Corp.,” she said. “We have always taken the position that executives should be rewarded for good performance. But there comes a time when too much is too much.” Even Wall Street has reined things in. The pay of Jamie Dimon, who had a rugged year at JPMorgan Chase, was cut almost in half to $11.5 million, down from $23 million in 2011 . Morgan Stanley’s James Gorman took home $9.75 million, 7 percent less than the year before. Then again, financial executives manage traders, not George Clooney, Beyoncé and franchises like “Iron Man 3.” Compensation experts say executives who negotiate in the rarefied air of glittering celebrities may begin to see themselves as magical themselves. “It infiltrates your thinking,” said James Reda, a consultant at Gallagher Benefit Services specializing in executive compensation. “They begin to think of themselves as deserving as much as the talent.” Of course, we all think we are worth more than we are paid, but that’s where boards and corporate governance come in. Or not. “These companies have historically weak boards and super aggressive chief executives,” said Alan Johnson, a compensation consultant. “And I think the boards get dazzled by interacting with celebrities and going to parties.” (At $3.3 million, Mark Thompson, chief executive of The Times, was far down the list because of the company’s lack of television assets. But that doesn’t mean it is immune to compensation controversy. When Janet Robinson left the post at the end of 2011, the $24 million payout she received raised many eyebrows.) It’s worth pointing out that payouts in the digital world were a fraction of that at traditional media companies, although many are run by founders who will be very rich by the time they cash out. At Netflix, the share price more than doubled last year, but Reed Hastings, the chief executive, took home $5.5 million, down from $9.3 million in 2011. Jeff Bezos of Amazon received just $1.7 million in compensation. And Marissa Mayer of Yahoo, who runs a company just slightly smaller than CBS and managed to lift shares more than 50 percent, earned $5.6 million in compensation after taking over in July, part of a package that awarded her $35 million in stock awards that vest over five years. That’s a very lucrative deal as well, but one could argue that the execution risk at her job, with a tattered brand and a hypercompetitive market that includes Google and Facebook, is a tad higher than for the average media boss. For the time being, traditional media business models are prospering and the leaders of the incumbents are fat and happy. But that might make them bigger, slower targets and in the end, easier to overtake.

Executive Compensation
News media,journalism
Mass media
TV


In Turnabout, Seeking Job of Comptroller, Not Mayor

Abstract: The outlook for New York City’s 2009 elections shifted on Thursday when Adolfo Carrión Jr. , the Bronx borough president, announced that he would not run for mayor — as he had long planned — but for comptroller instead. Mr. Carrión’s decision came after intense urging from many politicians in the Bronx and the rest of the city. They contended that Mr. Carrión could not prevail in a Democratic primary that also included William C. Thompson Jr., the current comptroller, who is a mayoral candidate. The politicians, mostly black and Hispanic elected officials, told Mr. Carrión that his effort to become New York City’s first Puerto Rican mayor would be crippled by dividing the minority vote between him and Mr. Thompson, New York’s only black elected official holding a citywide office. And they said that neither Mr. Thompson nor Mr. Carrión would have much of a chance without solid support from black and Hispanic voters. The clearest beneficiary of Mr. Carrión’s decision is Mr. Thompson. But it leaves a stronger, if narrower, field for the Democratic nomination, including the City Council speaker, Christine C. Quinn, and United States Representative Anthony D. Weiner, who represents parts of Brooklyn and Queens and who ran for mayor in 2005. Mr. Carrión, 46, made his announcement at the end of a breakfast speech before the Association for a Better New York at the Grand Hyatt hotel in Manhattan. In his speech, he discussed his vision for New York’s economy and education system. At the end, he said, “I have decided to run for,” then pausing for dramatic effect, “for New York City comptroller in 2009.” For months, Mr. Carrión maintained that his sights were fixed on running for mayor and that he did not subscribe to the commonly held views regarding ethnic and racial politics. Even on Thursday, he said there were no ethnic considerations involved in his decision. “We’re beyond that,” he told reporters after the speech. “There was a time when racial and ethnic politics really ruled the day. But, if you look, you can see our city’s ability to go beyond that and go beyond party and conventions.” For the moment, Mr. Carrión said, “I’m anxious to wrap my arms around that $112 billion investment fund, pension fund, and ensure the efficient operation of our city agencies.” Assemblyman Jose Rivera, the Bronx Democratic Party chairman, who attended Thursday’s breakfast, said Mr. Carrión’s decision was the correct one. He observed that he had been a part of previous efforts to elect a Hispanic mayor, most recently during the two mayoral campaigns of Fernando Ferrer, the former Bronx borough president. Echoing many black and Hispanic politicians, Mr. Rivera said, “Billy Thompson is running for mayor, and that’s no secret.” He added: “Would I want to be part of an effort to possibly create a division, a rift? I don’t think so. I think the best thing Adolfo could do is to run for comptroller. It’s not a bad position.” Mr. Thompson issued a statement on Thursday regarding Mr. Carrión’s decision. “Adolfo Carrión has distinguished himself as a leader and an accomplished public servant,” the statement said. “He would be a formidable candidate for any citywide position that he seeks.” It was not clear whether Mr. Thompson and Mr. Carrión had had any conversations regarding the politics of 2009 immediately before Thursday’s announcement. The men are friends and have said in the past that they never particularly relished the idea of running against each other. Mr. Carrión said only that he had had conversations with a number of politicians and with his wife before deciding to run for comptroller. Mr. Carrión’s decision also changes the outlook for the comptroller’s race. Having raised more than $1.3 million toward a 2009 race, Mr. Carrión immediately becomes a major force in the Democratic primary for comptroller. Other potential candidates for the Democratic nomination for comptroller are the City Council members David I. Weprin and Melinda R. Katz of Queens, and Simcha Felder and David Yassky of Brooklyn. Also in the race is Assemblyman James F. Brennan, a Democrat from Brooklyn.

New York City
Elections
Carrion Adolfo Jr


Water Pumping Begins at Japan Nuclear Reactor

Abstract: TOKYO — The difficult task of pumping highly radioactive water out of the basement of a turbine building at a damaged Japanese nuclear power plant began Tuesday, but officials cautioned that the work would be slow and difficult. The Japanese government, meanwhile, said it was considering a plan to further restrict access to the evacuated area within 12 miles of the plant, the Fukushima Daiichi Nuclear Power Station. Some families have been re-entering the area to remove belongings, and dozens of people have never left. At the plant itself, the Tokyo Electric Power Company said that it planned to pump 10,000 metric tons of water into a storage building at a rate of 480 tons a day, which would take nearly three weeks. The company is still working on ways to remove an additional 57,500 tons of heavily contaminated water at the same building, next to Reactor No. 2, and at other nearby buildings. The cautious pace of the pumping and the volume of water to be moved are further signs of the complexity of the undertaking that faces Tokyo Electric. Removing the water is one of the 63 tasks that the company outlined Sunday in its plan to fully shut down the stricken reactors, halt all releases of radioactive material and restore reliable cooling and electricity roughly by the end of the year. Michael Friedlander, a former senior nuclear power plant operator in the United States, said that while the pumping might be proceeding slowly, a faster pace could prove dangerous. “If a pipe breaks and you’re pumping hundreds of gallons a minute, you’re going to make a huge mess,” he said. Hidehiko Nishiyama, the deputy director general of Japan ’s Nuclear and Industrial Safety Agency, said that the heavily contaminated water that had accumulated in basements and trenches at the site is two million times as radioactive as the less contaminated water that workers pumped into the ocean from April 4 to April 10. Workers pumped 10,393 tons of the less contaminated water into the ocean in order to make room in storage areas for the far more highly radioactive water from inside the reactor buildings. Pumping contaminated water into the ocean has provoked considerable dismay from Japanese fishermen and from nearby countries, particularly South Korea and China. Mr. Nishiyama said Tuesday that Japan had no plans and no need to do so anymore. Plans are being made for the installation of water-purification equipment and heat exchangers so that the same water can be pumped repeatedly through the reactors. Anne Lauvergeon , the chief executive of Areva, France’s nuclear-power equipment provider, said at a news conference in Tokyo on Tuesday evening that it would probably take until the end of May to set up a water treatment station at the plant. Once running, she said, it should be able to handle 50 metric tons of water an hour and should almost entirely remove the radiation. The technology, called “co-precipitation,” uses chemical agents to remove radioactive elements from water. The treatment station itself will be provided by Veolia Water, a British water and waste management service. Areva and Tokyo Electric have not discussed the cost of the services, Ms. Lauvergeon said. Areva, together with Veolia Water, will also provide three lines of desalination equipment to enable Tokyo Electric to convert seawater into fresh water for cooling the reactors. Fresh water provides better cooling; the spaces between the fuel rods have started to become congested with salt from seawater. She also said that Areva was not preparing an overall plan to decommission the troubled plant, though she said the company was prepared to cooperate with any long-term process to eventually dismantle Fukushima Daiichi. Toshiba and Hitachi have submitted competing plans to dismantle the plant; the work could take decades. In a further effort to improve cooling, Mr. Nishiyama said Tuesday that a decision had been made to flood the primary containment vessels of the No. 1 and No. 3 reactors with enough water to cover up the sides of the reactor pressure vessels up to the level of the uranium fuel rods. This was not done sooner because only now have workers been able to determine that the primary containment vessels are sufficiently watertight. The vessel at the No. 2 reactor is damaged and leaking gases, and the leak or leaks need to be plugged before it can be flooded, Mr. Nishiyama said. The No. 2 reactor has posed some of the greatest challenges in recent days, including another leak that spewed radioactive water until plugged two weeks ago. Robots entered Reactors Nos. 1 and 3 on Sunday and measured the radiation inside . But when two robots entered Reactor No. 2 on Monday, the steam inside was so dense that a robot mounted with a camera was unable to get a clear image of a radiation sensor carried by the other robot, Japanese officials said.

Japan
Japan Earthquake and Tsunami (2011)
Nuclear Energy
Tokyo Electric Power Co


Japan: Isuzu to End Some S.U.V. Sales

Abstract: The truck maker Isuzu Motors said it would stop selling sport utility vehicles and pickups in North America in a year because of dwindling demand. Isuzu began selling S.U.V.’s in North America in the 1980s, and in 1999 its annual sales there topped 100,000 vehicles. Isuzu sold 7,000 vehicles last year in North America. In 2002, financial difficulties forced Isuzu to withdraw from a joint venture factory in Indiana with Fuji Heavy Industries, the maker of Subaru vehicles, and instead sell S.U.V.’s built by General Motors.


Santorum’s Catholicism Draws Evangelicals - On Religion

Abstract: Carissa Wilson began paying attention to Rick Santorum last fall, when her high school class in American government was assigned to watch several of the Republican presidential debates . About three weeks ago, she attended a campaign speech that Mr. Santorum delivered at her school near Dayton, Ohio. The next day, March 6, Miss Wilson cast the first vote of her life, balloting for Mr. Santorum in the Ohio presidential primary. It hardly mattered to Miss Wilson that she is an evangelical Protestant — raised as a Baptist, attending a nondenominational church and in her senior year at Dayton Christian School — and that Mr. Santorum is a Roman Catholic. In her thoughts and action, she typifies a cultural and religious phenomenon in the 2012 election: the unprecedented appeal of a Catholic candidate to evangelical voters. “I was never particularly concerned with his faith,” Miss Wilson said in a phone interview this week. “I was concerned with how it was manifested in his policies. I’m very on track with his views on abortion, his stance on embryonic stem cells . I love that he takes risks, that he says what he believes in.” What Miss Wilson — who, at 17, was allowed to vote in Ohio’s primary because she will be 18 by the general election — describes in a matter-of-fact way is actually part of a seismic shift. After more than a century of widespread antipathy between Catholics and evangelical Christians, a Catholic with Italian immigrant roots from the industrial Northeast has emerged as the favored presidential candidate among evangelicals, even in states he lost over all, like Ohio and Illinois. On the eve of Louisiana’s primary on Saturday, Mr. Santorum had won a plurality of the evangelical vote in 9 of 16 states, according to exit polls by Edison Research. “Santorum represents a game-changer,” said D. Michael Lindsay, the president of Gordon College, a Christian school near Boston, and an expert in evangelical voting patterns. “His candidacy has the potential to reshape conservative political alignment, securing once and for all evangelical support for a conservative Catholic in public life.” Mr. Santorum has, in fact, performed far better with evangelical Christians than with Catholics, who have preferred Mitt Romney, a Mormon, in virtually every state. Through a critical reading of the data, Mr. Santorum’s base of evangelical Protestants and conservative Catholics could be seen by cynics as a coalition of zealots, held together by intolerance. By another way of thinking, however, his candidacy offers proof of a growing tolerance on the part of evangelical Christians, a willingness to shed ancestral religious prejudices. It is worth remembering how viciously evangelical Protestants opposed Catholics early in the 20th century on issues like immigration and Prohibition. When Al Smith became the first Catholic to run for president in 1928, he was subjected to arguably the most bigoted attacks of any presidential candidate in history, accused of harboring secret plans to ban the Bible and end democracy in obeisance to the pope. In 1960, when John F. Kennedy became the next Catholic to seek the presidency, such prominent evangelical ministers as the Revs. Billy Graham and Norman Vincent Peale privately strategized over how to defeat him. Kennedy ultimately had to deliver a speech endorsing the separation of church and state, and by inference declaring his independence from the pope, to quell fears about his Catholicism. While evangelical Christians’ opposition to Catholicism has declined since then, virulent remnants do remain. In the 2008 campaign, Senator John McCain had to renounce the support of a megachurch pastor, the Rev. John Hagee, who had a history of disparaging Catholicism, as he did in one 2003 sermon , as “the apostate church,” the “mother of harlots” and “this mother-child cult.” The Lutheran synod that Representative Michele Bachmann, who ran for president this time around, belongs to states in its doctrines that “the papacy is the Antichrist.” Against this history, Mr. Santorum has benefited both from his personal qualities and broader demographical and theological shifts within the evangelical community. As a senator, he established a track record on issues like abortion, religious freedom and sexual trafficking that put him in frequent alliance with evangelical Christians. The road had also been paved for Mr. Santorum by evangelical Protestants and conservative Catholics, who for decades had tried to define common theological and political ground. In 1994, a panel led by the evangelical activist Charles Colson and the Catholic writer Richard John Neuhaus wrote a manifesto titled “Evangelicals and Catholics Together.” While acknowledging the divides in ritual and dogma, the document presented them as allies against “a widespread secularization” that “increasingly descends into a moral, intellectual and spiritual nihilism.” Such top-down efforts coincided with shifts in grass-roots religious life. “In the last 30 years, you’ve had a lot of breaking down of denominational lines within the evangelical community,” said William Martin, a sociologist at Rice University who has specialized in evangelical Christianity. “You had the growth of megachurches that don’t emphasize denomination or doctrine the way evangelicals once did. Catholics benefit from that. And the fear of modernity and relativism that has come with globalization has been a spur to fundamentalism of various sorts.” The plate tectonics of social mobility also figure into the Santorum surprise, note scholars like the political scientist John C. Green of the University of Akron. In the post- World War II years, many Catholics moved out of insular urban neighborhoods while many evangelicals left their rural and small-town homes for the suburbs and exurbs. In subdivisions, in office parks, in colleges, the young people of the two religions began to encounter one another as benign acquaintances rather than alien enemies. It is no coincidence, then, that a Santorum voter like Carissa Wilson has grown up in the suburban sprawl between two cities with strong Catholic heritages, Dayton and Cincinnati. Like the Michigan autoworkers in 1980 who made a break with Democratic tradition to vote for Ronald Reagan, Miss Wilson just may be the embodiment of a new wave.

Santorum Rick
Christians and Christianity
Evangelical Movement
Roman Catholic Church
Presidential Election of 2012


Kerry Says Snowden Affair Will Not Upset China Relations

Abstract: BANDAR SERI BEGAWAN, Brunei — Secretary of State John Kerry said on Monday that relations with China would not be upset by allegations that it had facilitated the flight of Edward J. Snowden, the fugitive former national security contractor. Mr. Snowden’s ability to avoid detention in Hong Kong and travel to Moscow, despite a request by the United States that he be arrested, initially led to an angry response by Obama administration officials. The White House last week described the development as a “serious setback” to American-Chinese relations, while Mr. Kerry himself warned that it would have “consequences” for ties with Beijing. But after a meeting with his Chinese counterpart at a conference hosted by Southeast Asian nations here, Mr. Kerry struck a conciliatory note, casting the Snowden affair as one issue among many. Asserting that Beijing had been helpful in pressuring North Korea to refrain from provocative actions, Mr. Kerry said that the Obama administration was committed to cooperation with China on issues ranging from maritime security to economic relations. “Life in international relationships is often complicated by the fact that you have many things you have to work on simultaneously, and so we will continue to do that even as we are obviously concerned about what happened with Mr. Snowden,” he said. The comments appear to reflect a new phase in the Obama administration’s handling of the Snowden affair. Instead of casting its request for the detention of Mr. Snowden as urgent business, administration officials now appear to be trying to play down the episode, perhaps recognizing that the United States’ ability to force a resolution is limited. Mr. Kerry arrived here on Monday after four days of intensive diplomacy in the Middle East that he said could put direct Israeli-Palestinian talks within reach. A major aim of Mr. Kerry’s presence here has been to demonstrate to Asian diplomats that he is no less committed to Mr. Obama’s “pivot” to Asia than his predecessor, Hillary Rodham Clinton. When a reporter for The Brunei Times asked him how he could carry forward a policy of emphasizing relations with Asia when he was focusing so much on the Middle East, Mr. Kerry appeared to bristle. “I’m here,” said Mr. Kerry, who said it was his second visit as secretary of state to Asia. "Over the next three and a half years of the Obama presidency, you will see energized and serious engagement in continuing the rebalance efforts.” But it was clear that the Middle East has been on his mind. During his flight to Brunei, Mr. Kerry spoke by phone to Prime Minister Benjamin Netanyahu of Israel about issues in restarting the peace talks. And during a news conference here, Mr. Kerry asserted that he had been so focused on his Middle East diplomacy in recent days that he was not aware of news media reports that Mr. Snowden had made available classified documents indicating that the National Security Agency had spied on the European Union. Catherine Ashton, the European Union’s foreign policy chief, who was also attending the conference here in Brunei, raised the reports with Mr. Kerry. On Sunday, Ms. Ashton issued a statement saying that she had asked the United States for an explanation. “I honestly had not heard about it,” Mr. Kerry told reporters, adding that he had told Ms. Ashton that he would look into the allegations and get back to her. At the same time, Mr. Kerry seemed to be preparing a defense along the lines that many nations engage in such spying. “I will say that every country in the world that is engaged in international affairs of national security undertakes lots of activities to protect its national security, and all kinds of information contribute to that,” he said. Mr. Kerry’s conciliatory stance on China was similar to comments he made last week about Russia’s involvement in the Snowden episode. After warning that Russia’s decision to shelter Mr. Snowden, at least temporarily, could have “consequence” for the Obama administration’s relations with the Kremlin, Mr. Kerry softened his tone and stressed that the United States was not looking for a confrontation . Mr. Kerry was scheduled to meet here with Sergey V. Lavrov, the Russian foreign minister, on Tuesday, and a major agenda item is Mr. Kerry’s efforts to elicit Russian cooperation in pressing President Bashar al-Assad of Syria to yield power and accept a political transition. One issue at the conference that was not overshadowed by the Snowden affair was the territorial disputes in the South China Sea and efforts to avert a military confrontation there. In an address to the conference on Monday, Mr. Kerry endorsed the nascent efforts to draft a code of conduct to discourage military incidents in the South China Sea. “"While we do not take a position on a competing territorial claim over land features, we have a strong interest in the manner in which the disputes of the South China Sea are addressed, and in the conduct of the parties,” Mr. Kerry said. “We very much hope to see progress soon on a substantive code of conduct in order to help ensure stability in this vital region,” he added. Territorial disputes in the South China Sea have become an increasing worry for the United States and its allies in the region. The area is rich with oil and gas and has been the source of tensions between the Philippines and China, among other nations. It also sits astride major shipping routes vital for world commerce. In comments to the conference on Sunday, Albert del Rosario, the foreign secretary of the Philippines, accused China of militarizing the area. “The overwhelming presence of Chinese ships, including military and paramilitary ships, and the issuance of threats pose serious challenges for the region as a whole,” he said. China has said it will consult on a code of conduct, which would aim to discourage military incidents, when officials from Southeast Asian countries gather at a meeting in Beijing with foreign ministers in September. That development that was welcomed at the conference here, but American officials also noted that it just the beginning of a long process that might eventually produce a set of set of explicit arrangements and procedures to reduce the risk of military conflict.

China
John Kerry
Edward Snowden
Government Surveillance
NSA


Fed Suggests a Growing Chance That Rates Will Rise This Year

Abstract: WASHINGTON — The Federal Reserve left its benchmark interest rate unchanged on Wednesday, but it issued an upbeat assessment of economic conditions that suggested a growing chance that it would increase rates later this year. The Fed, in a statement after a two-day meeting of its policy-making committee, said that the economy had overcome wobbles this year and that job creation had increased with moderate economic growth. Importantly, the central bank added that it saw fewer clouds on the horizon as the United States entered the eighth year of an economic expansion. “Near-term risks to the economic outlook have diminished,” the statement said, though it added that the Fed remained wary about the weakness of inflation and about “global economic and financial developments.” Janet L. Yellen, the Fed’s chairwoman, has won broad support among Fed officials for a patient approach to raising rates. But after a unanimous decision to leave rates unchanged at the Fed’s last meeting in June, there was one dissent at the July meeting. Esther L. George, president of the Federal Reserve Bank of Kansas City, voted for a quarter-point increase in the Fed’s benchmark rate. Ms. George, who has expressed concern that persistently low rates will lead to financial instability, voted in favor of rate increases in March and April. Recent data “indicates that the labor market has strengthened and that economic activity has been expanding at a moderate rate,” the Fed said in its statement. “Job gains were strong in June following weak growth in May.” Yet pockets of weakness remain, the Fed said, including a paucity of investment by businesses. The Fed did not raise rates at its last meeting in June, citing concern about a downturn in domestic job growth and uncertainty on the eve of Britain’s referendum on leaving the European Union. Those concerns have eased. The economy added 287,000 jobs in June and financial markets rebounded quickly even though the British unexpectedly voted to leave the European Union. Yet Fed officials made clear in the days before the July meeting that they were inclined to wait at least a little longer. “Sometimes you just have to take some time and let the waters clear,” Dennis P. Lockhart, president of the Federal Reserve Bank of Atlanta, said in a speech in Victor, Idaho , this month. Moreover, Fed officials have increasingly concluded that rates may remain unusually low for the foreseeable future. Before the financial crisis, the Fed estimated that holding its benchmark rate around 5 percent was a neutral policy, neither providing stimulus nor hitting the brakes. Now, after years of downward pressure on global rates, the Fed pegs that neutral rate at around 3 percent. That means the impact of holding the benchmark rate near zero has diminished — and it also means the Fed’s return to “normal” may not take as long. Still, some Fed officials have continued to emphasize that they expect to raise rates at least once before the end of the year. Some analysts predict that the Fed will move at its next meeting in September, although markets put the chances at only 20 percent. There are also meetings scheduled in November and December. In the next big event on the Fed’s calendar, Ms. Yellen is scheduled to speak at an annual policy conference in Wyoming in late August.

Federal Reserve
Interest rate
US Economy


AbbVie to Pay $21 Billion for Pharmacyclics, Maker of a Promising Cancer Drug

Abstract: AbbVie announced late Wednesday that it had agreed to buy Pharmacyclics, maker of a cancer drug that some analysts predict will eventually become one of the best-selling treatments for the disease, for about $21 billion. The deal is the latest in the health care industry, which has been rife with transactions as drug makers seek to refill their product pipelines with new treatments. For the past week, the lead bidder for Pharmacyclics was considered to be Johnson & Johnson. A deal between AbbVie and Pharmacyclics would be a remarkable turnaround for Pharmacyclics and its chief executive, Robert W. Duggan. Under the terms of the deal, AbbVie will pay $261.25 per share in cash and stock. That represents a 13 percent premium to Wednesday’s closing price. Based in Sunnyvale, Calif., Pharmacyclics focuses on anticancer drugs. Its product is Imbruvica, a pill used to treat certain blood cancers. A one-month treatment can cost $9,000 or more. Pharmacyclics’ revenue was $730 million in 2014, compared with $260 million the previous year. The acquisition cements a huge financial windfall for Mr. Duggan, the Pharmacyclics chief, who had no experience in pharmaceuticals when he took over the company in 2008, a year in which the stock dipped below $1 a share. It closed on Wednesday at $230.48; Mr. Duggan’s stake is worth about $3.2 billion. Mr. Duggan had made fortunes investing in and helping run companies as varied as a maker of children’s embroidery sets, a cookie bakery and Computer Motion, a pioneer in robotic surgery, which became part of Intuitive Surgical. He became an investor in Pharmacyclics in 2004 because he had a son with a brain tumor. The company was developing a drug for brain cancer that eventually failed to win approval from the Food and Drug Administration. Most of the company’s board resigned to allow Mr. Duggan and a slate of directors he proposed to take over. Mr. Duggan thought about trying to revive the brain cancer drug, but the company instead concentrated on starting clinical trials for a compound it had acquired a few years earlier for only $6.6 million. That compound became Imbruvica, known generically as ibrutinib, which was approved late in 2013. It is used to treat chronic lymphocytic leukemia and some other rarer blood cancers. Net sales of Imbruvica in 2014 were $548 million, with $492 million of that in the United States, Pharmacyclics said. Mr. Duggan predicted that sales in the United States would reach $1 billion this year. And some analysts predict that the drug will eventually reach $3 billion or more in annual sales. The deal is the first by AbbVie since its aborted attempt last year to buy Shire, an Ireland-based drug maker. That transaction — a so-called inversion, in which AbbVie would have moved its corporate residence abroad — was driven in large part by a desire to lower its taxes. Those deals largely stopped after the Treasury Department changed tax rules. Nonetheless, the pace of health care deals has continued to be brisk. AbbVie needs to diversify because it now gets almost two-thirds of its sales from the drug Humira, which is used to treat various autoimmune diseases and is the world’s best-selling medicine. But Humira will lose patent protection and is expected to face competition from near-generic copies known as biosimilars in the next few years. The company right now is not strong in cancer treatment offerings, but it is trying to create a bigger presence in that area. It is developing a drug called ABT-199 with Genentech that would treat the same types of blood cancers as Imbruvica, making it a potential competitor. However, there is some early evidence that the drugs could be used together. Still, there are likely to be questions raised about whether AbbVie is paying too much for what is essentially half ownership of a single drug. Johnson & Johnson has codeveloped Imbruvica with Pharmacyclics and co-markets it in the United States and sells it abroad. In a statement late on Wednesday, Johnson & Johnson said: “We’re looking forward to continuing our collaboration with the team at AbbVie to further develop and commercialize this important therapy for patients and their health care teams.” Morgan Stanley and the law firm Wachtell, Liton, Rosen & Katz advised AbbVie. Centerview Partners, JPMorgan Chase and the law firm Wilson Sonsini Goodrich & Rosati advised Pharmacyclics.

Pharmacyclics
Cancer
Johnson & Johnson
Pharmaceuticals
Mergers and Acquisitions


Hagel Gives Dire Assessment of Choices He Expects Cuts to Force on the Pentagon

Abstract: WASHINGTON — Defense Secretary Chuck Hagel warned on Wednesday that if across-the-board budget cuts were not lifted, the United States would have to reduce its global security objectives by trading away the size of its armed forces or its edge in technology as the Pentagon seeks to remain solvent. In a dire assessment of the financial challenges facing the military , Mr. Hagel said the political stalemate between the White House and Congress over a comprehensive deal for taxes and spending has required the Defense Department to plan for a range of cuts, since a deal to lift the across-the-board budget cuts known as the sequester remains elusive. Under the largest cuts the Pentagon is considering, Mr. Hagel described a trade-off: The military, he said, could maintain its size — as measured in the number of Army brigades, Navy warships, Air Force fighter squadrons and Marine expeditionary units — but not buy the most advanced new weapons. Or, he said, the Pentagon could shrink the force and put money into the next generation of weaponry. A decision to trade numbers for capability would involve a large drop in the size of the active-duty Army, which could shrink to between 380,000 and 450,000 troops. The Marine Corps would drop to between 150,000 and 175,000 personnel. (Under current budget orders, the Army already is set to fall over five years to 490,000 from a peak of 570,000, and the Marines are to drop to 182,000 from 202,000. The ground forces still would be slightly larger than they were before the attacks of Sept. 11, 2001, the beginning of a decade-long military buildup.) The largest Pentagon cuts would also require a concurrent reduction in aircraft carrier strike groups to 8 or 9 from 11. In addition, some number of Air Force squadrons could be retired. “This strategic choice would result in a force that would be technologically dominant but would be much smaller and able to go fewer places and do fewer things, especially if crises occurred at the same time in different regions of the world,” Mr. Hagel said at a Pentagon news conference. The other option — to maintain a sizable military to assure an overseas presence and project global power — would require the cancellation or curtailment of weapons programs, while slowing the development of cyberwarfare tools and reducing the number of Special Operations forces, Mr. Hagel said. Dollar for dollar, cybertools and Special Operations forces are considered among the most cost-effective in the Pentagon budget. This decision would result in what Mr. Hagel termed “a decade-long modernization holiday.” Regardless of whether the sequester cuts are lifted or reduced, Mr. Hagel indicated that the Army and Air Force were still likely to shrink. He said the assessment indicated that the military could still execute “the priority missions” with an active-duty Army of between 420,000 and 450,000 troops and a reserve component between 490,000 and 530,000. The current plan for the reserves is a force of 555,000. Mr. Hagel said the end of the Iraq war and the withdrawal from Afghanistan required the fresh look at Army force levels. The Air Force could reduce its tactical air squadrons by up to five and cut the size of its C-130 cargo fleet “with minimal risk,” Mr. Hagel said. He stressed that no final decisions had been made. The assessment, called the “Strategic Choices and Management Review,” was conducted over four months and looked at several spending plans. The full sequester would cut an additional $52 billion next year, with $500 billion over a decade. A middle plan would reduce military spending by about $250 billion over a decade. The plan with the smallest Pentagon reductions was based on a White House budget proposal for cuts of $150 billion over the next 10 years. But even without these cuts, the Pentagon must reduce its spending by $487 billion over a decade under an agreement with the White House. “The review showed that the ‘in-between’ budget scenario we evaluated would ‘bend’ our defense strategy in important ways, and sequester-level cuts would ‘break’ some parts of the strategy no matter how the cuts were made,” Mr. Hagel said. “Under sequester-level cuts, our military options and flexibility will be severely constrained.” The defense secretary briefed President Obama on the emerging assessment of how a range of budget cuts would be felt across the fighting force, including the challenge to Mr. Obama’s “Defense Strategic Guidance” — which laid out the current military strategy — signed in January 2012. “No decisions have been taken that would break the strategy at this juncture,” said one White House official, speaking on condition of anonymity to discuss sensitive military planning under the sequester. “This is bounded by the work we still are doing to secure a budget deal. Our judgment is, this is not the way to manage defense cuts. If we want to reduce defense spending, which we do, we want to do it in a way that is strategic. These are not strategic reductions.” Mr. Hagel also warned of serious reductions in some parts of the military compensation package, especially health benefits to retirees. He also said housing subsidies to military personnel could be trimmed and pay raises to service members and civilians could be limited.

Pentagon
Chuck Hagel
Federal Budget
US Military


Cargo Plane With 7 Aboard Crashes in Iraq

Abstract: BAGHDAD — A civilian cargo plane with a crew of seven crashed in western Iraq on Thursday morning, the United States military and a spokeswoman from FedEx said. Early reports suggested that the crew members did not survive, said the FedEx spokeswoman, Sandra Munoz. The Russian-made plane was operated by a Dubai-based firm and was carrying FedEx packages among its cargo. It crashed shortly after taking off from the Al Asad Air Base around 11:35 a.m. en route to Baghdad, said a military spokeswoman, Staff Sgt. Susan James. Though the cause of the crash was still unknown, American military and local officials said the plane had not been shot down. “It appears it was some kind of mechanical failure, that or a pilot failure,” Sergeant James said, adding that no allied forces were on the plane. A police official in the region, who requested anonymity because he was not authorized to speak to reporters, said heavy smoke could be seen coming from the plane before it crashed. “None of the residents of the area said anything about a missile or a rocket hitting the plane,” he said.

Iraq
Accidents and Safety
FedEx Corp
Airlines and Airplanes


Suit Seeks to Block Arkansas Abortion Law

Abstract: Supporters of abortion rights on Tuesday filed a challenge to the new Arkansas law banning most abortions at the 12th week of pregnancy, calling it a “violation of over 40 years of settled United States Supreme Court precedent” and a threat to “the rights, liberty and well-being of Arkansas women and their families.” When it was adopted last month, with the legislature overriding a veto by Gov. Mike Beebe, a Democrat, who called it “blatantly unconstitutional,” the law was the country’s most stringent limit on abortion. Later in March, North Dakota pushed the limit back further, to six weeks of pregnancy. In Roe v. Wade and subsequent decisions, the Supreme Court has said that women have a right to an abortion up to the point that the fetus is viable outside the womb, normally at around 24 weeks of pregnancy. The main sponsor of the Arkansas law, State Senator Jason Rapert, a Republican, said he believed that the Supreme Court was ready to redefine the meaning of viability, linking it to the detection of a fetal heartbeat. But most legal experts, including some prominent lawyers in the antiabortion movement, predicted that federal courts would quickly declare the laws in Arkansas and North Dakota unconstitutional. The suit was filed in United States District Court for the Eastern District of Arkansas, in Little Rock, by the American Civil Liberties Union and the Center for Reproductive Rights, on behalf of two doctors who perform abortions at a clinic in Little Rock and their patients. The law is set to take effect on July 18, but the suit asks the court to impose a permanent injunction before then.


Titans’ Finnegan Takes to Twitter to Explain His Walkout

Abstract: Tennessee Titans cornerback Cortland Finnegan is defending himself on Twitter, saying he left training camp on Saturday to deal with a personal matter and is not upset with his contract. Finnegan wrote Sunday that he had spoken with his coaches and teammates and would resume “all things asked.” He said his personal issue needed attention but that he would be back at practice Monday, when he will answer all questions. “My absence had nothing to do with a holdout yet a personal matter that Titan officials were aware of. I am grateful for being a Titan,” Finnegan wrote in one post. “I am also thankful for my current contract and direction of team.” The Titans first noticed Finnegan had left camp when he did not attend a special-teams practice Saturday morning, and General Manager Mike Reinfeldt said after practice Saturday afternoon that the team had tried unsuccessfully to reach Finnegan. Reinfeldt said the team was surprised he had left camp. But Finnegan wrote that the Titans knew of his absence and were disappointed he was not there. “Being absence from a team function doesnt mean holdout or your unhappy Family issues come up I’m human thank you Nashville for understanding,” Finnegan wrote. EAGLES WAITING FOR JACKSON Eagles Coach Andy Reid said he was ignoring reports that wide receiver DeSean Jackson would end his holdout and report to training camp Monday, as various news media outlets have indicated. “We’ll see,” Reid said. “I haven’t really focused on that. I haven’t talked to him. If he’s here, more power to him. If he’s not, like I told you before, my focus is to make sure that I get the guys that are here coached up.” Jackson, a two-time Pro Bowler, will earn $565,000 this season, the last on his four-year rookie deal. If he does not report by Tuesday, he stands to lose a year of service time toward free agency. FALCONS KEEP SNELLING Jason Snelling agreed to a one-year deal to return to the Atlanta Falcons. Snelling rushed for more than 900 yards while backing up Michael Turner the last two years. Snelling, who was a restricted free agent, participated in the team’s walkthrough practice on Sunday afternoon. BRADFORD SHARP IN SCRIMMAGE Rams quarterback Sam Bradford looked sharp executing the new St. Louis offense in the red zone during a scrimmage. Bradford completed 13 of 20 passes for 140 yards and 4 touchdowns against the Rams’ second-team defense. He threw one interception. Bradford’s favorite target was Danny Amendola, who caught eight passes for 70 yards. Mike Sims-Walker caught three passes for 71 yards and a touchdown. The scrimmage involved running plays, third-down situations and red-zone work under the direction of the offensive coordinator Josh McDaniels. The running game did not look as sharp. Cadillac Williams rushed six times for 16 yards. Jerious Norwood had three attempts for 7 yards. Steven Jackson, who was not on field much, had one carry for 3 yards.

Tennessee Titans
Snelling Jason
Atlanta Falcons
Football
St Louis Rams
Bradford Sam
Finnegan Cortland


Michael Thompson Wins Honda Classic

Abstract: PALM BEACH GARDENS, Fla. — The cold wind that buffeted the Honda Classic left a trail of debris. It creased the shiny image of the world No. 1, Rory McIlroy, who abruptly gave up the defense of his title in the middle of the second round. It whipped Tiger Woods, the world No. 2, like a pin flag. By Sunday’s conclusion, the leader board was so topsy-turvy that it produced a winner who had finished dead last in the field in his previous start. Michael Thompson closed with a one-under 69, one of only five sub-70 rounds recorded Sunday on PGA National’s Champions course, to seal a two-stroke victory over Geoff Ogilvy (69). Thompson finished at minus-9, a startling improvement over his 16-over-par performance two weeks ago at the Northern Trust Open outside Los Angeles, the highest score among those who completed two rounds. “The Northern Trust was a good thing in my life,” Thompson said. “It allowed me to focus on what I needed to do to play like I did this week.” The missed cut was Thompson’s third in four starts. With two months of the shortened 2013 season gone, he had made $10,919, which was not enough to cover his expenses. Upon returning to his home in Birmingham, Ala., Thompson spoke with his wife, Rachel, and his longtime swing coach, Susan Berdoy Meyers. He shared with them his worst fear: that he wouldn’t make another cut this year and would lose his PGA Tour playing privileges. They helped him to see that if his worst fate was to play golf next year on the Web.com tour, he still had an enviable life. Asked what led to Thompson’s turnabout, his wife said: “I don’t know other than him being completely at the bottom and being utterly broken down, and feeling like he had nothing going for him and just being able to focus on enjoying the game again and practicing and feeling like he was playing for himself and the passion he has for golf, rather than trying to please people and everyone around him.” There is maybe a lesson for McIlroy in the story of Thompson’s turnaround. McIlroy’s friends say he is putting too much pressure on himself to prove to the world that he is worthy of the megamillion dollar deal he signed this year with Nike. In an interview with NBC, Jack Nicklaus, an 18-time major champion and someone whose counsel McIlroy has sought in the past, described McIlroy’s withdrawal as unfortunate and said, “If he had thought about it for five minutes, he wouldn’t have done it.” Nicklaus added, “He’s a good kid; he’s a sharp kid; and I just think he is so frustrated with what is happening and the way he has played for the last month or so that it just got to him.” Thompson’s first tour victory overshadowed other resurgent performances. There was Erik Compton, a two-time heart transplant recipient who closed with a 70 to tie for fourth, his first top-10 finish in 61 tour starts. And Ogilvy, whose finish earned a spot in this week’s World Golf Championships event at Doral, outside Miami, and put him back in the mix for a Masters invitation. Ogilvy, playing in the penultimate group, narrowly missed an eagle putt at 18 that would have turned up the pressure on Thompson, 27, who got up and down from a greenside bunker for a birdie to make his victory more emphatic. Before that, he had par putts lip out on 16 and rim in on 17. “Today I did a really good job of not thinking about all the things that happen after a win or after I get done playing,” Thompson said. “I just kept telling myself, even on the last hole, just stick to what you’ve been working on.” Summing up the conditions, Thompson said it was a United States Open course with a British Open wind. In other words, it was a stage tailor-made for him. In 57 previous tour starts as a pro, his best finish was a tie for second last year at the United States Open at the Olympic Club in San Francisco. “Michael plays really difficult golf courses well,” Berdoy Meyers said by telephone from Arizona, “because he knows he doesn’t have to hit it perfect. I think when he tries to be too perfect is when he puts too much pressure on himself.” Woods’s goal coming into the day was to apply pressure on the leaders by posting a low number, like his 62 in the fourth round last year. He had to settle for a 74 that included a lost ball, two water balls, a three-putt and an eagle. When Thompson emerged from the scoring trailer, a tournament official was waiting to lead him to the award ceremony on the 18th green. Thompson made him wait while he signed golf balls and distributed them to each volunteer and security officer who had walked with him during the round. Even after the triumphant end, he would not let anybody take him out of his routine, would not get ahead of himself and think of all the things that happen after a win.

Rory McIlroy
Geoff Ogilvy
Golf
Jack Nicklaus
Michael H Thompson


Where Charlie Parker Once Stayed, Birds Find Refuge

Abstract: There are two signs in front of 151 Avenue B, a row house in the East Village facing Tompkins Square Park . One is a bronze plaque identifying the building as a former home of the jazz legend Charlie Parker , who lived in the ground-floor apartment from 1950 to 1954. The other is a handwritten slip of paper taped to the window of that same apartment, warning, “Please Don’t Knock Before 2 P.M.” Both signs were put up by the building’s owner, Judy Rhodes, who worked hard to get the building declared a city landmark in 1999. As for the “Don’t Knock” sign, Ms. Rhodes said she still favored the “jazz hours” she kept when she was a jazz producer, photographer and hard-core fan. “Nighttime is still the only time I can settle in and take care of my projects,” said Ms. Rhodes, 74, who since 1979 has lived in the apartment Parker inhabited with Chan Richardson and their children. In the life of the saxophonist nicknamed Bird, it was an atypically stable period. Here in this cozy apartment, Parker became a family man. He ate regular meals with the children, pushed them in swings out back and walked them to school. It was Bird’s sanctuary — he once practiced in the large walk-in closet. There is still plenty of bird song in the apartment. Ms. Rhodes has two pet parrots and she takes in injured pigeons she finds nearby and nurses them back to health. She releases the recuperated ones in Central Park or at a bird sanctuary upstate. “This guy here I found floating in my fish pond out back,” she said recently, sitting at her kitchen table and holding a young pigeon she was nursing back to health, no small thanks to $1,500 that Ms. Rhodes spent on a veterinarian who makes house calls. Sitting below a poster-size photograph of Parker, she stroked a recuperating pigeon, while a parrot roosted on her shoulder. Was it too corny to conclude that perhaps there was something subconscious that motivated Ms. Rhodes to create a bird sanctuary, in the literal sense, in what was once Bird’s sanctuary? “I’ve had people say that to me,” she said, with a laugh. “I used to tell them, ‘That’s ridiculous,’ but you know, it’s probably true.” After all, she does have a history of nurturing jazz and its artists. Her love for the music dates to her teenage years in South Carolina. She moved to New York City, married and divorced and raised four children in the East Village in the 1970s. She took an interest in the jazz loft scene, befriending avant-garde musicians like Butch Morris , Mal Waldron and Bill Dixon , and producing concerts and booking musicians for jazz festivals and gigs at clubs like the Village Vanguard and Sweet Basil’s. At one point, she brought a Steinway piano into her front room and opened it as a rehearsal space, attracting artists like Art Blakey , Dewey Redman and Don Cherry . “They all thought it was hip to be in Bird’s house. Dewey used to stand in the closet, praying or something. Once when Don was here, he said he had a vision of Bird heading out in a tuxedo.” There are constant visits from fans of Parker , a pioneer of the bebop style who died in 1955, his body ravaged by drug abuse and alcoholism. “One time,” she said, “a group of Japanese people came in and one of them fell to his knees, crying and kissing the floor.” She recalled learning in 1979 that the building was on the market, and the real estate agent who showed her the place pointed out Parker’s “practice closet.” “I went into the closet and closed the door and I said to myself, ‘I have to have this house,’ ” she said. “I just really liked the idea of living in the place where Bird lived.” She paid $90,000 for the four-story row house, she said, and over the years invested much more in improvements to the Gothic Revival building, which is between Ninth and 10th Streets and was built in 1849. The place has a Bohemian, jazzy feel, with plenty of African art, and walls covered with jazz photographs taken by Ms. Rhodes. There is still the faded birdcage-themed wallpaper Parker selected as a humorous nod to his nickname, and the same heavy cast-iron tub where Parker — and then Ms. Rhodes — bathed their children. These days, Bird’s tub belongs to her birds; they drink their water out of the soap dish.

Birds
Jazz
Parker Charlie
Rhodes Judy
East Village (NYC)


California: Cleanup of Oil on Beaches Has Cost $69 Million, Company Says

Abstract: The cost of cleaning up the oil spill that fouled California beaches last month has reached $69 million so far, an official of the pipeline company said Wednesday. The official, Patrick Hodgins, who is the coordinator for Plains All American Pipeline, said there was no timetable for completion. About 76 percent of 97 miles of coastline — mostly sandy beaches — has been cleared of oil. The May 19 spill occurred after an onshore pipeline operated by the Texas-based pipeline company ruptured, leaking up to 101,000 gallons of crude. About 21,000 gallons entered a storm drain and washed out to the Pacific Ocean off Santa Barbara County. The cause of the break has not been determined, but documents released by federal regulators said testing conducted in early May found extensive external corrosion along some sections of the pipeline.

California
Oil spill
Plains All American Pipeline
Santa Barbara CA


German Banks Are Critical of Tough Standards for Stress Tests

Abstract: FRANKFURT — A review of European banks could become a day of reckoning for some troubled German institutions, amid signs that the authorities may impose a tough standard for the funds that can be used to meet reserve requirements. The European Banking Authority, which is conducting the stress tests, is expected to announce in the coming days how it will define capital reserves, the money that banks are required to set aside for unforeseen shocks. Representatives of Germany’s public sector banks, while insisting the institutions are healthy, have expressed alarm in recent days that the standard may require them to exclude much of the borrowed capital they use to bolster their reserves. As a result, some German banks could fail the test, analysts said. The tougher requirement would “create a danger that healthy institutions could be artificially made to appear sick,” Heinrich Haasis, president of the German Savings Banks Association, said in a statement Friday. If the more severe definition of capital caused some German landesbanks to fail the stress tests, they could be required to raise more money, or in extreme cases even wind down their operations. Because the landesbanks are typically owned by state governments and local thrift institutions, German taxpayers would ultimately bear much of the financial burden. In that case, the landesbanks could become a liability for Chancellor Angela Merkel at a time when her party, the Christian Democratic Union, has lost ground in recent state and municipal elections. Critics accuse the German government of trying to keep the landesbanks’ problems out of public view. “Germany has not done enough to restore confidence in the landesbanks,” said Jörg Rocholl, a professor at the European School of Management and Technology in Berlin. “The process should have been much faster and more comprehensive.” The dispute revolves around so-called silent participations, money that the landesbanks have effectively borrowed from their owners, the savings banks and state governments, and counted toward their capital reserves. Regulators have expressed concern that, in a crunch, silent participations might not be very useful as a cushion against losses. New global banking guidelines call for such capital to be phased out as a component of so-called core Tier 1 equity, the most bulletproof form of reserves. A related issue is how much capital banks must have to pass the European stress tests, which are scheduled for June and will examine whether banks are strong enough to absorb shocks like a sudden economic downturn. Reuters reported Friday that the European Banking Authority would require banks to have core Tier 1 equity equal to 5 percent of assets. That is still less than new rules endorsed last year by the Group of 20 leading economies, which would require core Tier 1 equity of 7 percent of assets by the end of 2018. Representatives of the E.B.A. and the European Commission said Sunday that they could not comment on what standards the stress tests would use. The landesbanks, while insisting that they will pass the tests, have been lobbying the German government and European Commission to apply a less rigorous standard. “We have no indication that landesbanks will have problems with the E.B.A. stress tests and expect that all will pass,” Stephan Rabe, a spokesman for the Association of German Public Sector Banks, said in an e-mail. But he said that the association considers it unfair for the E.B.A. to apply standards that are not yet required by bank regulations, adding, “In our opinion the stress tests should be conducted according to existing rules.” During the last round of European bank stress tests, in July, all seven landesbanks passed. But those tests were criticized as too lenient and failed to restore investor confidence in the health of the German banking system. Some analysts have argued that Germany needs to confront the problems at the weakest landesbanks, like WestLB in Düsseldorf, and either supply them with more capital or wind them down. If not, the landesbanks threaten to drag down the German economy. Strong growth in Germany during the past year has helped compensate for weak growth in Southern Europe. “The robust economic trend in Germany and positive labor market data have diverted attention from the fact that fundamental structural problems in the financial sector have still to be addressed,” a group including two former landesbank chief executives wrote in a study issued by Goethe University in Frankfurt last month. The authors warned that problems in the landesbanks threatened the hundreds of savings banks, or sparkassen, which dominate consumer banking in Germany and are crucial to the economy. The sparkassen, which usually have close ties to local governments, often own stakes in the landesbanks and depend on them for wholesale banking services. The debate about how to design the stress tests takes place in the context of two decades of conflict between the European Commission and the landesbanks. In 2005, the commission required the landesbanks to give up the government guarantees that allowed them to borrow money more cheaply than commercial banks. Without that competitive advantage, several landesbanks have been struggling to find a new reason for being. In addition, institutions like WestLB or BayernLB in Munich suffered billions of euros in losses tied to investments in the United States real estate market, and required taxpayer bailouts. The European Commission has ordered WestLB to drastically scale back its activities and look for a buyer, as a condition for receiving government aid. But attempts to sell WestLB have been moving slowly amid meager interest from investors. At the same time, political leaders are loath to curtail the activities of the landesbanks, which give them influence in the local economy and account for thousands of jobs.

Germany
Banking and Financial Institutions
Merkel Angela
European Sovereign Debt Crisis (2010- )


Even in Good Times, Stash These Valuable Finds in the Cellar

Abstract: The Dow Jones industrial average closed down 127.04 points on Friday. The Commerce Department said housing starts dropped 6.3 percent in September, a 17-year low. President Bush warned that it would take time for frozen credit markets to thaw. The next day, miles from a beleaguered Wall Street, a man bought six magnums of 1996 Château Cos d’Estournel for a total of $2,000. Someone else paid $10,000 for three magnums of 2003 Château Ausone. A jeroboam of 1961 Château Latour sold for $38,000. And that was before lunch was served. The occasion was an auction by Acker Merrall & Condit , which calls itself the country’s oldest wine shop and is a leading wine auction house. On Saturday, Acker Merrall & Condit sold thousands of bottles of fine, rare and collectible wine and Champagne . The auction lunch, held at the restaurant Le Bernardin on West 51st Street in Midtown Manhattan, was a reminder that reports of a sagging economy should be kept in perspective. Waiters with steady, unrushed hands poured tall glasses of Krug Grande Cuvée Champagne. Standard wine bottles contain 0.75 liters. Many of those sold on Saturday were of larger varieties, including magnums, which hold 1.5 liters, or feed-a-family-of-four-style imperials, at 6 liters. Paddle 452 paid $3,200 for three bottles of 1973 Dom Pérignon. Paddle 1071 bought three double magnums of 1989 Château Pétrus for $55,000, and was not even in the room, but on the phone, as were other bidders. By the end of the day, between $4 million and $5 million worth of wine and Champagne was sold. But even here, the state of the economy was acutely felt. Prebidding was slower than usual, a development that John Kapon, Acker’s president and auction director, blamed on the economy. “There’s less bidding in advance than we would have had 6 or 12 months ago,” he said. “It means more people sitting on the sidelines, perhaps.” But midway through the six-hour auction, the action picked up. About 350 people — roughly 100 at Le Bernardin and another 250 absentee bidders — took part. Mr. Kapon stood at the lectern, orchestrating the bidding as people dined on a four-course lunch, the selections including white tuna poached in extra virgin olive oil and bread-crusted red snapper with basil-scented tomato consommé. Men and women mingled in the restaurant’s plushly carpeted, dimly lighted dining room, sipping Champagne, laughing, smiling. A brief bidding skirmish broke out over a double magnum of 1961 Château Palmer. Minute by minute, Mr. Kapon announced winning bids of $2,200 and $4,200 and $6,000 and $11,000. Bidders said one of the reasons the auction attracted such interest in these tight economic times was because of the source of the collection. The wines being sold were from the cellar of Wolfgang Grunewald, a renowned Swiss collector whose collection Mr. Kapon called “one of the last great collections of the 20th century.” Wendy Agah, a wine consultant for private collectors, including Acker Merrall, bought a number of bottles, both for clients and for her personal collection. She spent $12,500 on a magnum of 2002 Romanée Conti. She said she was putting into practice words of wisdom from Warren Buffett, the billionaire investor who has famously spoken of being greedy when others are fearful. She said she spent $250,000 at the auction. Mrs. Agah, who lives in Westport, Conn., and has a second residence in Manhattan, bought a 1996 Romanée Conti for $14,000. That price was far lower than its bidding estimate of $15,000 to $20,000 in the auction catalog. She considered it a steal. “I’m not going to sell it quickly,” she said. “But I know it’s a great longer-term investment.” Some bidders seemed to be watching their wallets. “Looking for $4,500,” Mr. Kapon said of six magnums of 1996 Château Ausone. “Anyone? 45?” With no takers, he passed on the bottles. For other bottles, Mr. Kapon was looking for a $6,000 bid but only got $5,500, and looking for $2,200 but getting only $2,000. And there was at least one sign of a cutback. The four-course lunch accompanied by complimentary tastings at Le Bernardin, one of the most acclaimed and most expensive eating establishments in the world, was only $100. “We were trying to give people a nice deal,” Mr. Kapon said.


Jubilant Marchers at Gay Pride Parades Celebrate Supreme Court Ruling

Abstract: The revelers carried handmade signs and rainbow flags, screeching noisemakers and fussy children. A familiar chant — at least before the coda — wafted over 41st Street in Midtown Manhattan. “What do we want?” “Marriage equality!” “When did we get it?” “Friday!” Two days after the United States Supreme Court affirmed same-sex marriage as a right , well-timed pride parades on Sunday in the country’s twin hubs of gay activism, New York City and San Francisco, promised a sort of social catharsis — a bicoastal toast to the nation’s rapid shift on gay rights and an extended curtain call for the movement that drove it. “All 50 states!” the New York crowd roared at one point. It was no longer a plea, but a celebration. If even a typical pride parade can blur the lines between friend and stranger, the proceedings on Sunday assumed the feel of a large-scale wedding reception, uniting graying activists, fledgling families and party seekers in a historic moment that all seemed keenly aware they occupied. “Doesn’t matter race, religion, gender,” said Dean Barnes, 49, a minister with the Metropolitan Community Church of New York . “When people find love with each other, they should be equally treated.” Mr. Barnes first attended New York’s pride parade 18 years ago, he said, when he came out. Now he rides a gleaming royal blue motorcycle with the Sirens, a biker group that leads the parade. On Sunday, his daughter and her wife were there to cheer him on. Riding down Fifth Avenue in Manhattan in a red convertible, two couples who were plaintiffs in separate marriage equality cases held signs attesting to the longevity of their relationships. “Together 33 years,” read one, by Jo-Ann Shain and her wife, Mary Jo Kennedy. “Together 37 years,” said the other, from Michael Sabatino and his husband, Robert Voorheis. A Celebration of Gay Pride and a Supreme Court Ruling 18 Photos View Slide Show › Image Chang W. Lee/The New York Times Two police officers along the route took notice. “Wow,” one said to a colleague. “They’ve been together 37 years.” Watching the floats on Market Street in San Francisco, Michael and Tom Crawford, both 52, recalled their marriage in 2004, after Gavin Newsom, then the mayor, had authorized same-sex weddings in the city. Soon after, the state’s Supreme Court invalidated the union. The pair moved to Massachusetts and married there before returning to California in time to see voters pass a proposition banning same-sex marriage in 2008. “I feel like a full citizen for the first time in my life,” Michael Crawford said. “And I feel that people that still hate no longer have the government backing them up.” Other cities, including Chicago and Seattle, also hosted parades on Sunday. Across the country, organizers and officials braced for large crowds, though at least in New York, the parade — never dull even in less eventful years — has been blessed by particularly good timing before. In 2011, it came just after New York State legalized same-sex marriage. In 2013, it was held days after the United States Supreme Court ruled that married same-sex couples were entitled to federal benefits. “Odd-numbered years we do well,” James Fallarino, a spokesman for the parade, said. One of the organizers, Chris Martin, said there were about 20 volunteers earlier last week to help inflate balloons. After the Supreme Court decision, his Facebook page was inundated with requests to be included. “People were saying, ‘Add me, add me,’ ” he said. By midmorning Sunday, scores of helpers had inflated more than 700 balloons, color-coordinated in sets of 20. At East 36th Street, the actor Ian McKellen, a grand marshal, waved his rainbow flag at spectators. An announcer asked the crowd for a brief period of silence in honor of those who could not be there: those who died of H.I.V./AIDS, those who committed suicide, those who fell victim to hate crimes. Moments later, the gravity gave way again to festivity. The actor Tituss Burgess broke into the national anthem, and scantily clad men wove their way through the marchers. Image A lone protester amid the parade crowd. Credit Todd Heisler/The New York Times Mayor Bill de Blasio was not far behind, towering over the crowd in a blue shirt, khakis and a rainbow tie. His daughter, Chiara, wore rainbow eye shadow and a rainbow hair tie. His wife, Chirlane McCray, and their son, Dante, held rainbow flags. Elected officials moved quickly to put their mark on the moment. Two days after Mr. de Blasio presided over two weddings and a vow renewal at City Hall, Gov. Andrew M. Cuomo, a fellow Democrat, scheduled a ceremony of his own for Sunday morning. (Until last week, Mr. Cuomo did not possess the power to officiate; as part of a legislative agreement in Albany, he persuaded state lawmakers to give governors such authority.) “I’m a little nervous today,” said Mr. Cuomo, whose role in the passage of same-sex marriage in New York was a major achievement of his first term. “This is my first marriage.” The wedding was held at the Stonewall Inn, the site of the 1969 riots that helped galvanize the fight for gay rights. Since the decision on Friday, its stretch of Christopher Street has doubled as a de facto celebration headquarters. Police barricades went up shortly after the ruling, closing the area to traffic and ensuring its status as a rollicking pedestrian plaza. Gatherers took swigs from champagne concealed less than subtly by plastic bags, beside officers who did not seem to mind. Bottles piled triumphantly against the curb. An impromptu rendition of “Somewhere Over the Rainbow” broke out. Many parade attendees on Sunday were first-timers. Destiny D’Angelo, 32, from Milltown, N.J., came with her girlfriend, Shante Wells, 27. Ms. D’Angelo said it was her first lesbian relationship, after ending what she described as an abusive relationship with the father of her two children. She described the parade as a test of sorts. If it goes well, next year she might bring the children, a 6-year-old girl and 13-year-old boy, who she says have been supportive. “My son’s just like, ‘Whatever,’ ” she said. For some, the ecstasy of the judicial victory has been accompanied by a twinge of concern. The movement has reached a crossroads created by its own success. But other gay rights issues, advocates say, cannot be ignored. Mr. Newsom, a Democrat who is now the lieutenant governor of California, said that securing employment protections for gay employees should be a top priority, adding that many religious groups were still seeking exemptions that could affect same-sex couples. Image The rain-soaked streets did not deter marchers from wearing heels. Credit Todd Heisler/The New York Times The “interracial marriage ban was overturned in 1967; that didn’t stop Charleston,” Mr. Newsom said, referring to the recent mass shooting at a historically black church in South Carolina. “Overturning bans on same-sex marriage is not going to end homophobia. Quite the contrary. There’s still bigotry.” Others pointed to transgender rights as a next frontier. In New York, a smattering of protesters sounded a discordant note, with one rabbi holding a sign lamenting the destruction of “religious liberty” and “moral values.” With cameras trained on the demonstration, paradegoers gleefully joined the photo, flashing smiles and peace signs. Nearby, the procession of papier-mâché floats, pulsing with music, was taking shape. There were marching bands and barely-there tops and humans dressed as giraffes, fairies and leprechauns. Several corporate-sponsored floats were hard to miss. One, from the restaurant chain Chipotle, was shaped like a burrito. Marchers danced inside it, wearing white tank tops emblazoned with the question, “¿Homo estas?” The city’s Fire Department settled for a more traditional eye-catcher: a flaming red truck, blaring its horn. The crowds also provided opportunities to the entrepreneurial set on either end of the country. Connie Clem, a San Diego native, sold rainbow chains, gloves and other trinkets from an outdoor stand on Market Street in San Francisco. “It’s crazy fun,” she said, as her inventory thinned by the early afternoon. And in Manhattan’s West Village, Kamar John, 55, of Bedford-Stuyvesant, Brooklyn, had positioned himself beside the Stonewall Inn early on Sunday. Usually, he sells political buttons. But the times demanded a change. “This,” he said, brandishing a collection of $3 rainbow flags, “is the only thing I can sell today.”

Parade
San Francisco
Same-Sex Marriage,Gay Marriage
Supreme Court,SCOTUS
NYC
Gay and Lesbian LGBT


Marvel’s ‘Inhumans’ TV Series Will Arrive via Imax Theaters

Abstract: LOS ANGELES — One of Marvel Entertainment’s most sprawling superhero mythologies, the Inhumans, is headed to the small screen in a major way. But the Inhuman likes of Black Bolt, Crystal and Lockjaw, the teleporting dog, will first appear on big screens. As in the biggest. Imax Corporation, Marvel and the ABC broadcast network announced a partnership on Monday to introduce — and finance — a lavish new television series that will focus on the Inhuman royal family . Under the agreement, a version that combines the initial two episodes of “Marvel’s The Inhumans,” shot entirely with Imax cameras, will play exclusively for two weeks next September on Imax screens worldwide. Shortly thereafter, the episodes — edited to include additional scenes — will run on ABC, with new installments unspooling in typical prime-time fashion. (The look of the series on TV will be enhanced due to Imax technology.) The series, billed as a family action-adventure with signature Marvel humor, will be set in the present day, with some action seeming to take place on the moon. The deal is significant for several reasons. As their live audiences have dwindled and competition has increased, broadcast networks have struggled to create sizzle around new shows. ABC, which urgently needs new hits, is betting that Imax, with its strength among younger consumers known as fanboys, will help make “The Inhumans” a must-see event. “In the incredibly crowded marketplace of television, we are very excited about this because it’s a unique and innovative and bold way to debut our best new content,” Ben Sherwood, president of Disney-ABC Television Group, said by phone. The deal also indicates that Disney remains focused on telling Marvel stories on ABC after an unexceptional start to that effort. “ Marvel's Agents of S.H.I.E.L.D. ” has brought more male viewers to ABC, but it has been only a modest ratings performer. Another effort, “Agent Carter,” was a misfire. ABC wants what Marvel Television and ABC Studios have supplied to Netflix — buzz-creating, widely watched series like “Luke Cage” and “Daredevil.” A co-financing arrangement with Imax will allow ABC and Marvel to spend more to make “The Inhumans,” which will include cinema-quality visual effects. (One criticism of “Agents of S.H.I.E.L.D.” has been that certain action sequences are less than dazzling.) Imax has never before served as a financing participant in a TV series, according to Richard L. Gelfond, the company’s chief executive. “We think this is a business for us,” Mr. Gelfond said of the financing arrangement. “Because Imax has an equity participation both in the pilot and in the series, this deal will be financially advantageous to Imax on an ongoing basis.” Imax has dabbled in the past at showing TV content on its supersize screens. Last year, for instance, it played a couple of Season 4 episodes of “Game of Thrones.” But a series has never before made its debut through Imax, which has more than 1,000 locations worldwide. “We see it as a way to extend the Imax brand and diversify our revenue,” Mr. Gelfond said. In particular, he hopes television content could help draw crowds to Imax locations at times of the year — like fall — when there is a dearth of blockbuster-style movies. Imax worked for years to find a winning strategy for quieter times at the box office; most recently it tried showing films aimed at older audiences, which delivered weak results. “We’re confident our exhibition partners will be excited about this,” Mr. Gelfond said. “The response from conceptual conversations has been extremely positive.” Marvel, which has been on a box-office tear , initially expected to turn the Inhumans into a string of movies, even announcing its plans publicly in 2014. But the studio ultimately decided the property would be a better fit for TV, in part because there were already a lot of different Marvel movie franchises continuing. Mr. Sherwood, noting pains have been taken to make sure ABC affiliates are on board with the Imax debut, said the “sneak peek” of “The Inhumans” would include “big, theatrical moments specially conceived for the Imax screen.” The series debut will also come at a time when no Marvel movies are playing in theaters. “We’ve worked very carefully with our friends at Marvel Studios — and this is a critical point — to make sure that calendar-wise and content-wise we are only enhancing the Marvel universe,” he said.

Inhumans
TV
IMAX
IMAX
Marvel Entertainment
ABC
Movies
Comic strip


Putin Is Approved as Prime Minister

Abstract: MOSCOW — Russia ’s Parliament overwhelmingly confirmed Vladimir V. Putin as prime minister on Thursday, completing his managed departure from the presidency in a manner that left him the country’s dominant politician, with a firm grip on power. Mr. Putin, out of office only a day, received 392 votes in the 450-seat Duma, Parliament’s lower house, before the resolution confirming his new post was handed to his protégé and presidential successor, Dmitri A. Medvedev , who promptly accepted it. Only 56 members of Parliament, all Communists, voted against the appointment. Their party leader issued a scathing assessment of Mr. Putin’s eight years of rule, saying they were marked by lost opportunities. Two members of Parliament were not present. The dissenting speech was broadcast live on national television, unusual in a country where criticism of Mr. Putin has been blocked from television for years. But Mr. Putin, with the guarantee of 315 votes from United Russia, the party he leads, once again commanded the stage. Before the vote, he delivered a 45-minute speech proposing a series of domestic policy initiatives. While the speech included many of Mr. Medvedev’s campaign themes, it was largely indistinguishable from Mr. Putin’s presidential addresses over his two terms. “Great and grandiose tasks lie before us,” he said. Mr. Medvedev sat silently. The proposals included efforts to reduce double-digit inflation; tax breaks for education, housing and medical costs; and more spending for housing, infrastructure and military equipment. He also proposed tax reductions for the oil sector and a law to stop corporate raiding, and said his government would work to revive agriculture and spur domestic food production. Mr. Putin, 55, suggested that he would move quickly and that legislators would receive draft legislation in August. The underlying message centered on continuing the economic rebound, both to raise living standards and economic security for Russia’s citizens and to secure Russia’s path as a resurgent world power, themes that Mr. Putin developed as president. In Washington on Thursday, the State Department said that Russia had ordered the expulsion of two American military attachés working at the United States Embassy in Moscow. “We believe that the expulsions were not justified,” Sean McCormack, a department spokesman, said. “But as we all know, in the world of diplomacy, sometimes these things happen from time to time.” He said department officials were not making “any particular connection” between the expulsions and earlier dust-ups between Washington and Moscow. Mr. Medvedev, 42, was sworn in as Russia’s third post-Soviet president on Wednesday. His path to office had been assured since December, when Mr. Putin, who under the Constitution could not seek a third consecutive term, endorsed him. Mr. Medvedev’s inauguration as head of state and Mr. Putin’s confirmation as the leader of government created a new model for Russian power, which has become known here as a “diarchy.” But much remained undone. There was no public indication of the shape of the new government or of the assignments of the ministers and advisers who made up Mr. Putin’s entourage. Although Mr. Putin spoke at length about prosperity, he passed more quickly over Russia’s corruption problems, which one legislator called “a scourge.” Corruption, already widespread in the post-Soviet world, became a daily facet of Russian life under Mr. Putin, from bribes for school admissions to reports of kickbacks and forced corporate takeovers touching the highest reaches of Kremlin power. Mr. Putin also sat through a rare public critique, as Gennadi A. Zyuganov, the leader of the Communist Party, explained why his party would not support Mr. Putin as prime minister. During Mr. Putin’s rule, Mr. Zyuganov said, Russia’s population declined and many highly educated citizens moved away. Food and utility prices have climbed, he said, and infrastructure, factories and heavy machinery have fallen into disrepair. While commodity prices rose severalfold, he said, the country did not revive agriculture or manufacturing, invest enough in education or develop a high-technology sector. And democratic development stopped. “With this course and this team,” he said, “we shall not be able to make any progress and will end up with the stagnation of even those achievements you are so proud of.” Mr. Zyuganov’s address had little effect. A few minutes later, Mr. Putin received most of the votes in the chamber. The legislators rose for a standing ovation.

Russia
Putin Vladimir V
Medvedev Dmitri A


Ex-C.I.A. Officer Named in Disclosure Indictment

Abstract: WASHINGTON — The Justice Department on Thursday announced the indictment of a former Central Intelligence Agency officer who is accused of disclosing classified information to a reporter, in the latest example of a crackdown by the Obama administration on leaking to journalists. The former officer, Jeffrey Alexander Sterling, who worked at the C.I.A. from 1993 until he was fired in 2002, was arrested Thursday in St. Louis. He was indicted Dec. 22 on charges that he disclosed restricted information to a journalist about a clandestine program intended to impede the progress of unnamed countries’ weapons capabilities. While the indictment does not identify the journalist or the intelligence operation, its details make clear that prosecutors believe Mr. Sterling was talking to James Risen, a reporter for The New York Times. Mr. Risen wrote about a C.I.A. attempt to disrupt Iranian nuclear research in his 2006 book, “State of War: The Secret History of the C.I.A. and the Bush Administration.” That material did not appear in The Times. The indictment says that the journalist worked on an article about the program in 2003, but the newspaper decided not to publish it after government officials told editors that such a disclosure would jeopardize national security. But Mr. Risen devoted a chapter of his book to the program, which he portrayed as a flawed operation that may have helped the Iranians gain nuclear technology. He was twice subpoenaed to divulge his source; once by the Bush administration, and, after the first grand jury investigating the case expired, again last year by the Obama administration. Mr. Risen declined to comment about whether Mr. Sterling was his source, but said that he had provided no assistance to prosecutors. Judge Leonie M. Brinkema of Federal District Court in Alexandria, Va., quashed the subpoena of him in November, he said. “I never testified and never provided the government with any information,” he said. “I never met with prosecutors and never reached any agreement with them.” Mr. Risen’s lawyer, Joel Kurtzberg, confirmed his account. Gregg Leslie, the legal defense director for Reporters Committee for Freedom of the Press, called the quashing of the federal grand jury subpoena in a criminal investigation “truly unusual,” saying he knew of no other such instance. The indictment of Mr. Sterling is the fifth case during the Obama administration in which a current or former government official has been charged in connection with a leak investigation. “The law does not allow one person to unilaterally decide to disclose that information to someone not cleared to receive it,” said Neil H. MacBride, the United States attorney for the Eastern District of Virginia, where Mr. Sterling was indicted. Mr. Risen’s book describes how in February 2000, the C.I.A. sent a Russian nuclear scientist — who had defected to the United States — to give plans for a nuclear bomb-triggering device to an Iranian official. The C.I.A. had hidden a flaw in the designs. By Mr. Risen’s account, the Russian scientist immediately spotted the flaw, but the agency insisted on proceeding with the operation. So the scientist decided on his own to alert the Iranians that there was a problem with the designs so that they would take him seriously. The chapter argues that Iranian scientists may have been able to “extract valuable information from the blueprints while ignoring the flaws.” It also says that a C.I.A. case officer, believing that the agency had “assisted the Iranians in joining the nuclear club,” told a Congressional intelligence committee about the problems, but no action was taken. In the indictment, prosecutors say that Mr. Sterling met with two staff members of the Senate Select Committee on Intelligence in March 2003, and disclosed information about the program. The document portrays Mr. Sterling’s concerns as inaccurate, saying they were “based solely upon his mischaracterization of a single remark by a participant” in the operation. Mr. Risen stands by the accuracy of his book, Mr. Kurtzberg said. Mr. Sterling, who is black, had a stormy history with the C.I.A. He accused the agency of racial discrimination and later tussled with it over permission to publish his memoirs. The indictment says he harbored “anger and resentment” against the agency and leaked as “retaliation.” In March 2002, Mr. Risen wrote a newspaper article about Mr. Sterling’s discrimination case. In making their case against Mr. Sterling, prosecutors provided details in the indictment of phone calls between the residences of Mr. Sterling and the reporter and quoted from e-mails sent between their accounts. Justice Department rules say prosecutors may seek subpoenas of journalists only if the information they are seeking is essential and cannot be obtained another way, and the attorney general must personally sign off after balancing the public’s interest in the news against the public’s interest in effective law enforcement. A Justice Department spokesman declined to comment about why Attorney General Eric H. Holder Jr. approved seeking a subpoena of Mr. Risen in light of the fact that prosecutors could obtain an indictment of Mr. Sterling without it.

Classified Information and State Secrets