Business News

Joshua Shulman: Rights Have to Be Enforced Somehow

by Joshua Shulman on April 18, 2012

Huffington Post…

There are two ways to enforce rights. A government agency can do it, or it can be outsourced to private contractors, which means plaintiffs’ lawyers. If we’re going to use a government agency, then we have to make sure they do it efficiently, because our tax dollars fund those agencies. If we’re going to use private lawyers, they’ve got to be able to make good money doing it, otherwise they’ll do something else instead. If neither of those systems works for us, then let’s not pretend that we care about the rights that we’re refusing to enforce. The New York Times presented a front-page article on April 17 about lawyers suing New York City businesses that don’t have good wheelchair access. The story is that the plaintiffs’ lawyers are finding violations — easy in New York City, with its many ancient buildings, narrow-aisled, with aging or nonexistent ramps — and then choosing a plaintiff from a cadre of disabled people. Then the lawyers threaten to sue the allegedly violating business, the plaintiff gets a few hundred dollars, the lawyer gets a few thousand, and it all seems like a shakedown to the poor business owner. Of course, this is not how it’s supposed to work. A wronged person is supposed to seek out the lawyer, not the other way around. So this article has provoked anger against the trial lawyers who are supposedly abusing the system for their own enrichment. Having lived in New York, I treasure the funky old out-of-compliance stores, where even a non-handicapped person has difficulty navigating the aisles. I love those places, and my personal belief is that a variance ought to be available to them so they can preserve their funky old character, even if it means that the “temporarily able-bodied” are the only people who can safely get in and out. But of course, that’s not the law. That’s not the choice that we as a country have made about this issue. The choice that we made, and the law that we passed to enforce that choice, is that almost all businesses open to the public have to be able to safely accommodate handicapped people. And then we as a country made another choice: the government would not be given the resources to enforce this law. Instead, we would give an incentive to private contractors (lawyers) to enforce the law, by forcing out-of-compliance businesses to pay the lawyers’ fees when the lawyer could prove that the business was out of compliance. So now we’re angry at lawyers for being too aggressive in their enforcement? Well, here’s a story about what happens when we choose the other path of having a government agency enforce the laws. The Equal Employment Opportunity Commission (EEOC) is supposed to investigate alleged employment discrimination, then if it finds a violation, negotiate with the violating business to fix it, and if that doesn’t work, then the EEOC may file a lawsuit against the business. Note that the EEOC is required to try to negotiate a workable solution before it files a lawsuit. Seems reasonable. But the EEOC is short of resources. They field about 100,000 complaints of discrimination every year. They recovered more than $450 million for employees last year, with a budget of $343 million. So you could say they’re running a profit, sort of. But they are still constantly understaffed, overworked, and simply don’t have anywhere near the resources needed to investigate every one of those 100,000 claims. So, like all government agencies, the EEOC has to decide how to most efficiently allocate their scarce resources. One obvious choice is to focus on companies that are practicing system-wide discrimination, so they can bring class-action suits. For example, CRST Van Expedited Inc. is one of the largest trucking companies in the United States. They have an “internship” program, in which women who want to become truck drivers are paired with male truck drivers, and left together unaccompanied for weeks at a time, with predictable results . By bringing a claim against a company like this, which has allegedly caused sexual discrimination and harassment against hundreds of women, the EEOC should be able to use its resources efficiently, right? Protect hundreds of women with just one big lawsuit, instead of trying to pick them off one at a time, which would take forever, and lots of agency resources. Well, the Eight Circuit Court of Appeals just slapped down the EEOC , saying that their lawsuit against the trucking company fails because the EEOC did not take the required step of trying to negotiate in good faith with the trucking company about each case individually . But doing that would eliminate the efficiency of having one big case instead of many small ones. The EEOC did negotiate with CRST about their (idiotic) program as a whole, but not about each individual case. Sure, in an ideal world, they would talk about each case separately. But in a world where efficiency matters, that’s a crazy requirement. It’s exactly the kind of requirement, in fact, that makes a government agency unable to perform its function of keeping the workplace free of discrimination. Which leaves it to whom, exactly, to to enforce our rights against workplace discrimination? Why, to the private lawyers, of course. In fact, one of the few women who opted out of the EEOC suit against this trucking company sued CRST privately. The jury awarded her $1.5 million . We as a country have to decide what rights we want to enforce, and whether to enforce them with government agencies, or with private contractors. But whipsawing back and forth is unfair. If we choose government agencies, then we’ve got to let them be efficient. Listen up, Eight Circuit. If we choose private contractors, then we’ve got to let the profit motive motivate them. Listen up, lawyer-bashers.

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Joshua Shulman: Rights Have to Be Enforced Somehow

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A Major Setback For Kamala Harris

by Aaron Sankin on April 18, 2012

Huffington Post…

For the nearly two years that Kamala Harris has been California’s Attorney General, she has made the fight against fraudulent foreclosures her signature issue. Now, largely due to pressure from business groups, legislators look like they may soon succeed in tanking her most ambitious plan yet to clean up the state’s mortgage market. Earlier this year, Harris began pushing for California to pass the “Homeowner Bill of Rights,” a collection of six bills that would make significant changes in the way the state regulates mortgages. Harris was scheduled to testify before the California Assembly’s Senate Banking and Finance Committee on Monday; however, only moments before she was supposed to appear, both of the bills she was discussing were pulled by the committee chairman, Democrat Mike Eng of Monterey Park. The sudden change reportedly prompted a chorus of catcalls from the assembled crowd. The pair of laws Harris was scheduled to discuss aim to increasing protections for mortgage borrowers by prohibiting lenders from foreclosing on a property while simultaneously negotiating a loan modification on that property and also simplifies loan documentation by establishing a single, standardized contract for foreclosures and loan restructuring. Other provisions in the bundle require banks to provide homeowners with a single point of contact during the loan modification process and levy a $25 fee on banks every time they register a default. Proceeds from the default fee would then go into a pool of money funding mortgage fraud investigations. As part of the $25 billion settlement between the nation’s five largest mortgage holders and the attorneys general of 49 states, in which Harris was a crucial player , the large institutions that hold nearly 30 percent of all mortgages in the state have already agreed to abide by some of these rules. However, that settlement expires in three years and Harris wants the rules to extend into perpetuity. The banking industry strongly opposes the measures. The Sacramento Bee reports : In letters to legislators, the state chamber said the measures amount to a “de facto moratorium on foreclosures” that would actually hurt the real estate market with a confusing new set of laws, squeeze credit for property purchases and trigger a wave of lawsuits. The chamber also contends the bills are in conflict with federal standards and are an “extraordinarily restrictive and draconian” permanent response to temporary industry abuses. Conversely, the bills have received strong support from civic leaders in San Francisco. “Too many San Franciscans have been devastated by the mortgage crisis and too many families have lost their homes due to deceiving banking practices right here in some of our most vulnerable communities,” said San Francisco Mayor Ed Lee in a statement to the San Francisco Sentinel . “Thousands of foreclosures have happened and are happening in neighborhoods in our cities. I applaud the leadership of Attorney General Kamala Harris for standing up for families and using the powers of her office to protect homeowners from mortgage fraud and abuse.” Last week, the city’s Board of Supervisors passed a non-binding resolution calling for a moratorium on all foreclosures in the city until additional protections, such as the ones in Harris’s bills, are enacted. An audit of 400 San Francisco foreclosures conducted by San Francisco Assessor-Record Phil Ting found that 84 percent were either fraudulent or missing crucial documentation. “This matters because families facing foreclosures are entitled to know exactly who holds their loan and to see for certain that the foreclosure is justified,” Ting wrote in a blog on the Huffington Post . “In one case, our audit showed a foreclosure initiated by a party that had no title to the property–and in a number of other cases, we found two competing claims to the title.” (Full disclosure: Aaron Sankin was briefly an unpaid intern on Harris’s 2003 campaign for San Francisco District Attorney.)

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A Major Setback For Kamala Harris

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Date Leaks Finance Guy’s Match.com Spreadsheet

April 17, 2012

From pretending to be an Israeli spy to burning down an ex’s parents’ house , there’s no shortage of press coverage when it comes to dating sociopaths in the financial industry. Now, there’s a new finance guy ready to creep out the Internets. First posted on DealBreaker , this nameless singleton loves to type up all the details about each of his potential Match.com suitors and put them into an Excel spreadsheet. Strangely, the guy actually revealed this on a date and later via email to Arielle, one of his lucky ladies listed in the infamous spreadsheet. But Arielle couldn’t keep a secret and, according to Deadspin, proceded to forward the email to her friends . Now, the attached spreadsheet is making the rounds on the Internet. From ranking attractiveness, to noting the last time they spoke and listing contact details, this spreadsheet is pretty in depth. But apparently it helps the man in demand stay “organized” , he later revealed in a phone interview to Jezebel. Check out the email and the edited spreadsheet below. (NOTE: Photos and contact names removed.) From: [redacted] Date: Sat, Apr 7, 2012 at 12:16 AM To: [26, Oyster Bay, 9.0] Subject: spreadsheet… Well…this could be a mistake, but what the hell. I thought about deleting the names, but figured I might as will give you the whole thing. I only deleted the non-match people’s names (at the bottom) since some I’ve known for a long time. I hope this e-mail doesn’t backfire, because I really had a great time and hope to hang again soon :) . However, I will keep my word! Have a great weekend!

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White House Threatens Veto Of Tax Cut For The ‘Fortunate’

April 17, 2012

WASHINGTON — In the second major shot in Washington’s ideological battle over taxes this week, the White House on Tuesday slammed a small-business tax-cut proposal in the House as a handout for the “fortunate” and threatened to veto it. The Small Business Tax Cut Act of 2012, sponsored by House Majority Leader Eric Cantor (R-Va.), would slash taxes on the adjusted gross income of as many as 22 million small businesses — those with fewer than 500 employees — by as much as 20 percent for one year. It would add $46 billion to the deficit. The House is set to consider the bill on Thursday. On Monday, Senate Republicans blocked the Buffett Rule, a measure from the ideological opposite end of the spectrum, which aimed to ensure that multimillionaires and billionaires paid at least a 30 percent tax rate. Cantor argues that the average $6,500 tax break resulting from his measure would serve as a potent economic stimulus, which could spur growth by letting entrepreneurs keep more of their money to spend and reinvest as they saw fit. “This is a bill which will directly help small businesses create jobs,” Cantor told reporters on Tuesday. “And as the Senate voted last night and the Democrats brought up their priority, which was to raise taxes, we believe you ought to reduce taxes on small businesses to create jobs. And in fact, there’s a study out, which shows that this bill, when fully implemented, will create an additional 100,000-plus new jobs.” Cantor was referring to a study by conservative tax analyst Gary Robbins, who heads the firm Fiscal Associates. But critics have argued that the benefits would disproportionately land in the pockets of wealthy individuals and businesses such as sports franchises, financial firms and celebrities . Congress’ revenue estimators, the Joint Committee on Taxation, has calculated that the top 11 percent of small businesses would grab 64 percent of the break, while the 125,000 firms with $1 million a year in adjusted gross income would snag 18.3 percent. The 9.2 million small businesses at the bottom of the income heap would share about 15 percent of the break. The bill “is not focused on cutting taxes for small businesses, but instead would provide tax cuts to the most fortunate,” the Obama administration noted in a statement. “Under the bill’s definition of income, many of the ‘small businesses’ that would receive the largest tax breaks are law partners, consultants, and other wealthy individuals and corporations with the biggest profits. The proposal is a giveaway that will cost $46 billion and could, in fact, lead to delays and reductions in investment and hiring.” Rep. Xavier Becerra (D-Calif.), who also opposes the bill, recently told The Huffington Post that this proposal could lead to reductions in investment. That’s because any capital investment that a business counts for a tax break lowers its adjusted gross income. If a business takes that deduction this year, this would lower the income on its books eligible for the 20 percent break. So, he argued, businesses might put off capital investments. “You’re thinking, wait a minute, I want to get 20 percent off as much as I can now. Why don’t I hold off that investment until next year, ” Becerra said. “The reality is this is almost a wait-till-next-year tax break, which essentially makes a lot of businesses hold off making investments today that could lead to jobs tomorrow.” The White House argued that a more “targeted” approach that simplifies tax rates and encourages new hiring would be better. “If the President is presented with H.R. 9, his senior advisors would recommend that he veto the bill,” the administration’s statement concluded. Michael McAuliff covers politics and Congress for The Huffington Post. Talk to him on Facebook .

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Rep. Carolyn Maloney Seeks To Deny Tax Breaks To Men-Only Businesses

April 17, 2012

If businesses like the Augusta National Golf Club, home to the Masters tournament, can continue to deny women membership , then the government should withhold their tax breaks, says Rep. Carolyn Maloney (D-N.Y.). Maloney’s Ending Tax Breaks for Discrimination Act, which she has introduced multiple times since 2003, prohibits businesses that discriminate on the basis of sex or race from deducting travel or advertising expenses from their taxes. Now, on Equal Pay Day and in light of the prestigious Georgia golf club’s refraining from extending membership to IBM’s new CEO, Virginia Rometty, because she is a woman, Maloney has reintroduced the bill with a new working title: the Equal Play at Augusta Act. “When a woman, Virginia Rometty, took over as head of IBM, it was an excellent time for the [Augusta National Golf Club] to change that tradition of not admitting women,” Maloney told The Huffington Post. “But instead of recognizing her and breaking with this outdated tradition, they decided to continue with this discrimination.” “I am filing a bill that really follows the example of when Congress passed Title IX for athletic equality,” Maloney added. “Any organization or institution that discriminates against women or men should not be able to deduct the cost of doing business, such as their meetings, flights and food.” While there is no official count of how many private country clubs and other organizations in the United States discriminate against women, media outlets have identified at least 24 males-only country clubs since the Augusta club garnered attention in 2003. If the bill makes it out of the House Ways and Means Committee this time around, it could put the GOP in an awkward position, since many prominent Republicans , including presidential candidates Mitt Romney and Newt Gingrich, former aspirant Rick Santorum, and Sen. John McCain (R-Ariz.), have publicly criticized the Augusta National Golf Club for not admitting women. House Speaker John Boehner (R-Ohio) is a member of a Maryland all-male golf club , which makes the issue even more awkward for him. But if Maloney’s ultimate aim is to coax private males-only clubs into changing their policies, the support of influential Republican men can provide her with more leverage to do so. “A woman can run a great company, she can run a country, she can run circles around her competition, she can be at the top of her profession, but Augusta National Golf Club believes she cannot be a member of its club simply because she is female,” Maloney wrote in an April 13 letter to William Payne, the club’s chairman. “There is a wide and growing consensus that this is a policy whose time has long since past. There are not many things in this world that Mitt Romney, Newt Gingrich, Rick Santorum, President Obama and I can all agree on. But this is one of them.”

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Twink-ruptcy: Hostess May Go Under In Labor Dispute

April 17, 2012

Marking the peak of a heated labor dispute, Hostess Brands and the Teamsters union are squaring off in bankruptcy court Tuesday in a case that could decide the iconic company’s future. The union, which represents 7,500 Hostess workers, hasn’t reached a contract agreement with the bankrupt maker of Twinkies, Ding Dongs and Wonder bread, saying the company is demanding too much in the way of concessions. Hostess argues that its pension and labor costs are untenable. A ruling against Hostess in court would force the company back to the bargaining table with the Teamsters. A ruling in favor of Hostess would allow the company to escape its current labor contracts. “And in that case, we will be on strike,” Ken Hall, Teamsters vice president, told The Huffington Post. According to Hall, the union’s Hostess workers voted overwhelmingly to authorize a strike. Though he wouldn’t put a date on it, he said the strike could happen “very soon.” The union recently acknowledged to the court that negotiations were ” in crisis .” Hostess CEO Gregory F. Rayburn said in an emailed statement that a strike by either the Teamsters or the workforce’s other major union, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, would put the company under. “Hostess will be forced to liquidate if there were a strike by either of its largest unions because its lenders would pull their financing,” Rayburn said. “That’s why the company has tried to reach a consensual agreement with its unions that would lower the costs of its union pension and health plans while still providing employees with good, industry standard benefits.” The two sides failed to reach an agreement in advance of the hearing in bankruptcy court in New York, each arguing that the other’s proposals were unreasonable. After an offer made by Hostess over the weekend calling for steep pension cuts, the Teamsters made a counter offer with more modest concessions that amount to $150 million annually, including the temporary suspension of pension payments, according to the union. Hostess maintains that the current employee pension plans are too costly and financially unstable. In a letter to employees Monday, Hostess warned that a strike would cripple the company: “All Hostess Brands operations would shut down and liquidation would begin. The 18,500 jobs, plus the health insurance that comes with them, would be lost for good.” The union’s hard stance suggests a degree of frustration among rank-and-file workers. Dow Jones reported earlier this month that Hostess’ creditors were concerned that the company may have manipulated executive pay leading up to its Chapter 11 filing, possibly allowing Hostess managers to sidestep compensation requirements under bankruptcy law. The company has denied the creditors’ implications. Joseph Ortuso, a Hostess route salesman and Teamster based in New Jersey, said the news about executive pay was galling, given the talk of the need for shared sacrifice as the company struggles. “They’re saying they can’t afford to pay pensions when they’ve given [huge] increases to executives,” Ortuso, 53, said. According to Hostess, the raises put in place for executives last year were scrapped, and the company’s top four executives have agreed to work for $1 until either the end of this year or when the company emerges from Chapter 11, whichever comes first. The company also says unionized employees have had more generous raises than non-unionized employees during the past three years. “It is factually incorrect to claim that union employees are the only ones being asked to sacrifice,” Rayburn said. Hall, the Teamsters official, has been critical of Hostess management since the company came out of its last restructuring three years ago. He said the company needs to steer its branding and image toward healthier products to appeal to modern consumers. “All the other companies have changed with consumers’ desires,” Hall said. “This company hasn’t. We want to make sure whatever our members are giving up will help make this company profitable.” The company maintains that it, too, would like to invest in branding, marketing and research and development, but can’t under its current cost structure. The bankruptcy judge is expected to make a decision on Hostess’ union contracts in several weeks.

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How To Turn Your Instagram Photos Into A Pillow

April 17, 2012

Instagram’s sale to Facebook earlier this month for $1 billion was the crescendo of the startup’s rapid rise and dominance in the mobile photo-sharing market. But within the Instagram universe lies another market — small businesses allowing you to customize products using photos from your Instagram account. From flipbooks to T-shirts to posters, a myriad of websites have sprung up around the ability to turn your Instagram photos into physical or decorative mementos. Apart from creation, startups have also come up with new methods for browsing Instagram and sites where you can look at statistics and insights from your account. Consider it the Instagram Economy. One such Instagram-inspired creation is Stitchtagram , a Washington, D.C.-based company that allows you to craft 15-inch throw pillows with photos from your Instagram account for $95 plus shipping. Stitchtagram is the brainchild of brother-and-sister duo Doug and Rachel Pfeffer. Doug works for Internet ad agency The Barbarian Group while Rachel leads Rachel Pfeffer Designs , a jewelry store. “My sister and I had been talking about it for a while and we wanted to get it out there into the world in time for our Christmas and holiday orders, so it has only been a few months,” Doug Pfeffer said of Stitchtagram’s November launch. “I’m not going to retire off Stitchtagram just yet, but it’s been a great project so far.” For Adrian Salamunovic, co-founder of CanvasPop.com , a site that blows up, prints and frames your Instagram photos, Instagram’s user base of some 40 million people has been a fertile customer pool. “We could tell early on that Instagram was going to explode,” he said. “We knew we had to be the first company to allow this huge marketplace to print large images and we achieved that. Fast forward six months later and we’ve sold tens of thousands of prints to our fellow Instagram fanatics, with almost no advertising.” Instagram’s clean, intuitive interface and easy access for third parties have allowed this secondary market to grow alongside the popular photo-sharing app. Apart from technical matters, Instagram photos are inherently practical for businesses printing and using the pictures. “It’s a simple thing to go in there and access your photos,” Pfeffer said. “Instagram has this great API, so it makes it really easy for third parties to go in and pull the photos out of there. A side effect of this simplicity is that all Instagram photos are the same dimensions so it actually makes it way easier to print.” “What makes Instagram so perfect for doing business is that they have a highly influential, early adopter, connected, creative audience that loves to share stuff — in other words, the clients that everyone wants,” Salamunovic added. “These people look for cool authentic products they can get behind. More importantly Instagram never had a focus on monetizing their audience, so we did it for them via their API that they provide for free to developers.” For CanvasPop, their printing extends beyond purely Instagram photos — offering prints and canvases for SLR photos and even Facebook pictures. Pfeffer echoed that he was hoping to open up his pillow creation tool to Facebook photos to expand his audience and offer more variety in pillow creation for customers. With Facebook’s high-profile — and high-priced — purchase of Instagram, there has been a ton of press and a flood of new users using the application. With the release of the app for Android and the big news of the purchase, Instagram added more than 10 million users in only 10 days , bolstering its user base to 40 million strong. “One reason a lot of people, including me, like Instagram is because it seems like it’s more of a closed network of people you’re interacting with,” Pfeffer said. “As far as business goes, more people is never a bad thing.” Here’s a look at some of the more creative third-party Instagram companies:

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Obscure Chemical Shortage Threatens To Disrupt U.S. Auto Industry

April 17, 2012

An explosion at a German auto supplier two weeks ago could prove to be disastrous for the global auto industry, as auto suppliers are now faced with shortages of a key chemical that could shut down car production in the United States, Europe and Asia. About 200 representatives from auto suppliers and major automaker executives convened in Detroit on Tuesday to figure out how to replace PA-12, a nylon compound used in plastic fuel lines and brake lines; it is favored because it can withstand heat and can stand up to corrosive gasoline additives. The news of the potential shortage was first reported by Bloomberg . “A significant portion of the global production capacity of PA-12 (nylon 12) has been compromised,” declared a statement issued by the Automotive Industry Action Group after the summit. The chemical isn’t easily replaced, the group said, noting, “These are highly engineered products produced via a very complex manufacturing process.” Industry players will work together to stretch current supplies of the chemical to make it last longer. They will also seek alternatives to PA-12 and test new solutions to make sure they can endure the same wear and tear. Evonik is one of the leading producers of PA-12, which is used as a coating for plastic pipes, also used in solar panels, offshore pipelines, sporting goods and household goods. About 40 percent of the global supply of PA-12 was cut off after an explosion at an auto supplier called Evonik Industries in the North Rhine-Westphalia region of Germany. The March 31 accident, which killed two company employees, took place in the part of the plant producing two chemicals that go into PA-12′s manufacture. Evonik told Reuters on Tuesday that it will take three months for its plant to resume normal production. “The possibility for serious disruption is real,” said Paul Blanchard, an analyst with IHS. Auto manufacturing runs on what’s called a “just-in-time” schedule, meaning parts arrive at the assembly plant often just hours before they are needed. This keeps plants clean and lean — they don’t have to store up massive amounts of inventory until those ingredients are needed — but it also makes production susceptible to disruption when something goes awry. And this incident exposes vulnerabilities in the world’s most complex supply chain, whereby 3,000 individual parts go into each car or truck made. Each component contains hundreds of other pieces supplied by multiple other companies — such as the rubberized portion of a windshield wiper, the hard metal parts of that wiper or the electronics used for a wiper to move. All it takes is for one of those parts to be missing and an entire production line can be shut down. The auto industry has faced massive parts shortages in the past. Just last year, the earthquake and tsunami that rocked Japan resulted in widespread destruction of scores of auto suppliers. A company that produced the base chemical for black and red paints was damaged and a maker of car computer components also suffered damage. The industry scrambled to find new sources for those materials. By the end of last year, some shortages had resulted — several dealers had waiting lists for cars like the Toyota Camry — and many people had to choose car colors other than black or red. But for most consumers, the tsunami caused only minor disruptions. This time, however, could be different. “This could prove to me slightly more serious, depending on the industry response, because the material has worked its way into many fuel systems,” Blanchard said. “It’s not as simple as being able to pick a black car instead of a blue one. They are all going to have this material in their fuel systems.” For now, no automaker has canceled production as a result of a shortage of PA-12. But following the Japan tsunami last year, it took several weeks for the impact to surface in the United States.

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Chip Conley: The 7 Practices of PEAK Leadership

April 17, 2012

Why don’t we “practice” business? I’ve come to realize that — unlike medicine and law — we don’t think of our profession as business leaders as a “practice.” A few years ago, in the last downturn, I developed the principles of PEAK as an alternative operating model for my business based upon Abraham Maslow’s iconic Hierarchy of Needs pyramid. Reinterpreting this well-known theory of human motivation helped me to see that all stakeholders associated with a company have their own Hierarchy of Needs. My company Joie de Vivre tripled in size during this difficult period and I came to find out that a variety of other transformational companies like Harley-Davidson have used Maslow’s theory as a foundation for their business model. Business principles are only as good as the practices that back them up. Recently, with the assistance of some good friends, I’ve developed a set of PEAK Leadership practices that can assist any leader or leadership team to move from survival to success and on to being a transformative role model in their industry. When a company embeds these principles and practices in how they grow their leaders, the end result is PEAK performance: a phenomenon of sustained growth — both for the organization as well as for those within the organization. Practice 1: Embody an inherently positive view of human nature. The principles of PEAK have their roots in humanistic psychology and a basic belief that man is meant to “be all that he can be.” So, it’s not surprising that the fundamental first practice is assuring that a PEAK leader believes that humans — at their very core — gravitate to goodness when the right conditions exist for them to flourish. Creating what Maslow called “psycho-hygiene” in a company means focusing on people’s best qualities and believing in what’s been known for a half-century in business as a “Theory Y” perspective on management versus “Theory X.” With Theory X, management assumes employees are inherently lazy and will avoid work if they can. As a result of this, management believes that workers need to be closely supervised and a comprehensive system of controls developed. With Theory Y, management assumes employees may be ambitious and self-motivated. They believe the satisfaction of doing a good job is a strong motivation and seek to create the conditions for the employee to develop their own strengths to be successful. While this latter theory may feel intuitively right to many of us, is your organization still structured in a Theory X style of business? Practice 2: Create the conditions for people to live their callings. Great leaders understand there are only three relationships you can have with your work: a job, a career, or a calling. A job tends to deplete you and a calling energizes you. Most employees live in the bartering world of work. The company gives them a compensation package and recognition and, in return, the employee gives their time and energy. Yet, those that are living their calling have moved from external to internal motivation. And, these employees are not exclusively focused on the specific collection of tasks they perform and are more focused on the impact or purpose of what they do. The best hospitals have more nurses living their calling. The best airlines have the happiest flight attendants (Southwest). What are you doing to help your people find their sense of calling in what they do? Practice 3: Promote and measure the value of intangibles. In business, we are taught that leadership is all about managing what you can measure, but what’s most easily measurable is the tangible in life. Yet, is it the tangible or the intangible in business and life that creates value? In business, the metrics that track the tangible are well known: your profitability, assets & liabilities, cost structure, market share. Yet, in reality, these tangible metrics are the result of a series of intangibles that drive excellence: brand loyalty and reputation, employee engagement, customer evangelism, the ability to innovate. Great leaders nurture, value, and evolve corporate culture — one of the most valuable intangibles — as a key differentiator for their company. These intangibles are the inputs that drive the tangible output that most companies use to evaluate their performance. In the 21st century, great leaders are learning how to measure and benchmark these intangibles so that they’re not out of sight, out of mind. Which intangibles are most valuable to your business and how are you measuring them? Practice 4: Ability to move fluidly between being a “transactional” and a “transformational leader.” Author James McGregor Burns once wrote that, “Transformational leaders look for the personal motives in followers, seek to satisfy higher needs, and engage the full person of the follower.” Yet, most management decisions require only transactional thinking because the goal is purely to optimize existing resources. A great leader is able to move fluidly between addressing the foundational needs that people have, but also helping them see beyond the short-term so that they can be motivated by a compelling vision that helps them transcend their momentary challenges. How much of your time is stuck in the trenches as a transactional leader versus focusing on how to create transformation? Practice 5: Calibrate the balance between “Conscious” and “Capitalism.” Business has quite often been seen as a “zero-sum” game. One person’s win is another person’s loss. Taken to the global level, some believe that capitalism’s short-term gains are often to the long-term detriment of the environment and to certain communities. And, at this crossroads, in an increasingly transparent world, this is why great leaders have to think more broadly about the impact of their decisions, not just on the bottom line, but on their broader stakeholders. In many ways, Walmart took this step when they saw their stock price flat line even with sizable revenue and net income growth. Yet, for those socially conscious business leaders, cash flow is the blood that keeps your organization alive. Make sure the basic survival needs of your company are met. How do you balance the priorities of the broader community versus the financial needs of your company? Practice 6: Focus on your customers’ highest needs. Henry Ford once suggested, “If I asked my customers what they wanted, they would have said a faster horse.” PEAK leaders and companies understand what the customer wants even before the customer has articulated it and they realize that customer innovation requires a certain amount of mind reading and cultural anthropology. By doing this well (with Apple being the best example in the world), you create a movement and evangelists and reduce your need to spend money on traditional marketing. Are your customer satisfaction surveys just asking the obvious questions that will track their expectations and desires, but not their unrecognized needs? How can you “mind read” your customers? Practice 7: Lead to PEAK. Just as a Sherpa does in the Himalayas, great leaders meet their people where they are on the pyramid and help them to see the natural path to the peak. They recognize the value of loyalty and mentoring as a means of sustainable success in business. PEAK leaders champion personal development in tandem with corporate development knowing that there’s a synergistic effect of having a self-actualized individual in the workplace as evidenced at companies like Google. And, most importantly, they embody authentic leadership by being, not just by doing. How are you incubating a collection of great leaders? Conscious people pay attention. It’s true of spiritual leaders. It’s true of business leaders. PEAK leaders pay attention to the higher needs while not neglecting the base needs that provide a foundation for their organization. Leadership is all about making conscious choices and knowing that the higher you are in a company, the more magnified your decisions and behavior will be throughout the organization.

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Kat Griffin: Which Is Better: The Bigger Office or the Better-Located One?

April 17, 2012

The other day, a reader of my blog Corporette wrote in with a great question: should she leave her well-located office and move to a bigger one down the hall? There is a large office that has been vacant in our firm for 9 months or so (another associate was let go). I have a small office, but I like the location of it. It’s right next to the partner I work for and the assistant we share, and there’s always activity around it, which suits my work style. The large office is down the hall a bit, in a quieter area with less activity and visibility, all of which are “cons” for me. I’ve been going back and forth with asking to move (I know they’d say yes). I think the large office looks better to clients, I’ve been here for several years now, and I’m the only attorney still in a small office, the rest are occupied by paralegals. Any thoughts as to size versus location and which is more important? Tough, tough question. My gut reaction is you should stay put because you seem happy in your current office… but your points about the paralegals and clients are serious things to consider. Whichever one you choose, you may want to read our suggestions on office decor. I suppose the first question to ask is whether there are any dream offices — i.e., larger offices, near your partner or in other active areas — even if they may be occupied at the moment? If so, first look at who’s occupying them. Does anyone have their door closed frequently because the activity level is too much for him or her? Is anyone far from his or her assistant? I might approach that person and see if he or she would be interested in moving down the hall to the vacant office, perhaps with the promise of a nice lunch out on you (or help moving?) or something of the like. If that doesn’t work out, have a conversation with whoever is in charge of office assignments and put in an informal request to have your dream office once it becomes vacant. If your choice is still between the small but well-located office or the larger but remote office, I think you have a few questions to ask yourself, such as: What percentage of your time is spent in meetings? Will this percentage greatly increase in one year, or two years? Are there conference rooms nearby that you can use for meetings instead (and a reliable reservation system to make sure you have a room when you need it)? Alternatively, can some of your meetings (such as new business pitches, etc) be held over lunch? If so, invest a little time in perfecting the networking lunch , such as picking one nearby spot with excellent service (and decent food) for lunch, and getting to know the staff there so the meal goes incredibly smoothly. If you would still prefer to hold meetings in your office, continue to the next question… Can you declutter your current office, perhaps by claiming file space near the vacant office? If your office is smaller than everyone else’s, it should be as clean and as orderly as possible (although in general, readers have said that that a messy office only crosses the line “when it looks like you can’t get work done in there.”) Finally: Do you need to break any bad patterns? You mention “the partner I work for.” I don’t know the particulars of your situation — maybe many associates in your firm are assigned to only help one partner. But in some companies, it can be a bad sign if you’re only working with one boss. Seriously take stock of that relationship: are you getting the opportunities you need for growth? Are you learning what you need to accomplish your goals, whether you want to become partner, go in house, open your own practice, etc? (Even if your goal is to be a stay at home mom, I would advise working with as many people as possible so you have numerous doors open to you if/when you return to work.) Would you benefit from feedback from other partners? If you take stock of that relationship and don’t like what you see… moving offices could be a great way to break up the pattern that has been established, and to start working with other partners at your firm. HuffPo readers, what are your thoughts — would you prefer a big office, or a well-located one? How much does “keeping up with the Joneses” play into it, versus having an office that suits your workstyle?

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Houses Just Ain’t Worth What They Used To Be

April 17, 2012

It’s a tough time to be a home builder — especially now that so many houses aren’t worth what it costs to build them. That’s the surprising finding of a recent report from the National Association of Home Builders. About one out of every three builders is now grappling with a dismaying problem: once the homes are finished, an appraiser comes around and declares that they’re worth less than they cost to construct , according to the report cited by SmartMoney . That’s bad news in a market where housing sales are already far from robust. Persistently low prices and an overall climate of economic uncertainty are keeping many would-be homebuyers from taking the plunge. The lack of momentum in the housing market, in turn, is thought to be a major factor keeping the economy in low gear — not to mention crowding out low-income renters as more and more people are skittish about buying . Selling a newly built house presents a special set of challenges — not all of which have to do with home appraisers, a group the NAHB has been quick to criticize in the past. As SmartMoney notes, the market is already flooded with cheap foreclosed properties , which homebuyers are more likely to turn to. New-home sales fell in February to a number about 10,000 less than what analysts expected , according to CNN. There are already more than 10 million vacant homes in the country , according to some estimates, but the supply of new houses seems on track to keep going up. Builders requested the most permits in March for new construction projects in three and a half years , according to the Associated Press. That’s good news as far as unemployment is concerned — an NAHB economist told CNN last month that three jobs are created for every new house that gets built — but it remains to be seen what kind of effect it will have on a market where housing supply already far exceeds demand.

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Tech Giant Considered Creating Its Own Android Rival

April 17, 2012

SAN FRANCISCO (Reuters) – Oracle Corp Chief Executive Larry Ellison said the software maker had considered building its own smartphone to compete with Apple Inc and Google Inc, but decided it was a “bad idea” after a weeks-long cost and market analysis. As part of that exhaustive internal analysis, he said, Oracle had pondered at one point buying Blackberry-maker Research in Motion Ltd and Palm — a smartphone maker scooped up by Hewlett Packard Co. On the second day of a legal battle between Oracle and Google over Java patents used in Android mobile software, Ellison added that Oracle felt it lacked in-house expertise on smartphones and hence considered acquisitions. But it ultimately decided to abandon the idea. (Reporting By Edwin Chan and Dan Levine; Editing by Gerald E. McCormick)

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How We’re Spending Our Tax Return

April 17, 2012

If you’re like us, you might be getting a little bit of money back from the federal government this year, so you better start planning what you’re going to do with it now. Below, we’ve used a pie chart to illustrate exactly how we’ll be spending our return, starting with the most money going towards another hilarious presidential campaign, and ending with a couple of quarters going to insignificant things like debt. How are you spending your return?

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Quick Study: Is Linking Money And Lifestyle The Key To Financial Health For Women?

April 17, 2012

Quick Study [kwik stuhd-ee]: The Huffington Post Canada’s tips to make your life a little sweeter, five minutes at a time. Think of it as a cheatsheet for your general well-being. As the tax deadline fast approaches, more people start scrambling for financial help — and like so many other lifestyle choices, women go about getting it together completely differently than men, relying on mentors, family and friends to educate and influence them. Barbara Stewart, a Toronto chartered financial analyst, is the author of the white paper Rich Thinking: A Global Study – A Guide to Building Financial Confidence in Girls and Women . According to a 2010 Angus Reid survey she commissioned , more than 50 per cent of women say their financial knowledge was mainly acquired through informal instruction from other people. “There’s a disconnect between what we’re teaching women about financial literacy and how they actually learn,” Stewart said. “Most of what I see in textbooks and on websites for financial institutions is very dry information.” Last year, Stewart spoke to 50 accomplished women from around the world about the messages on money they received while growing up. For many of the women, linking lifestyle to money was key. SEE: The 10 financial tips Stewart uncovered for women. Full story continues below slideshow. “It’s important to have a conversation with young people. We all hear that sort of corny question, ‘What do you want to be when you grow up?” she said. “Instead of just that, we should ask ‘How do you want to live? and ‘How much money do you think you’ll need to live that lifestyle?” Stewart put together Rich Thinking in an attempt to give young women a 10-step toolbox that she hopes will help them form their live paths. “The main message that came through it all was to be independent. Being independent is the root to building financial confidence,” Stewart said. “Understand that what we want costs money fundamentally and then learn how to deal directly with money yourself.”

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Gulf Oil Sheen’s Likely Source Revealed

April 17, 2012

NEW ORLEANS (AP) — A federal agency says it has confirmed a natural seep of oil from the Gulf of Mexico near where a large oil sheen was spotted last week. The Bureau of Safety and Environmental Enforcement said Monday that experts confirmed a “modest” amount of oil is seeping from the Gulf floor after viewing video provided by Royal Dutch Shell PLC. The oil giant used remotely operated vehicles to aid in the investigation of the sheen. Experts say such seeps are common in the Gulf. The seep is suspected to have caused a light sheen, about 10 miles long, that was spotted last Wednesday afternoon off the Louisiana coast. Authorities said the sheen was dissipating Thursday and Friday. A Coast Guard spokesman had no new information Monday.

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Investors Run To Surprising Place

April 17, 2012

Investors around the world are getting more anxious, and they’re choosing to put their money in an unusual safe haven: the U.S. stock market. A new Bank of America Merrill Lynch survey of global mutual-fund managers, released on Tuesday, finds that investors scrambled for safety last month as worries about the European debt crisis once again flared. The percentage of money managers hoarding what they consider to be an unusually high amount of cash jumped to 20 percent from 10 percent in February, according to the BofA survey. And global money managers pulled some money out of the global stock market last month, according to the survey — not surprising at a time when there are worries that the global economy is slowing down. But on balance money managers around the world poured more cash into the U.S. stock market in March. The percentage of investors “overweight” U.S. stocks — meaning they had more money in U.S. stocks than usual — was higher than the percentage “underweight” the U.S. market by 27 percentage points, up from 14 percentage points inFebruary At the same time, global investors pulled some money out of the stock markets of Brazil, India and other “emerging” markets. And they continued to avoid the European, British and Japanese markets like a sneezing guy on the subway. This behavior isn’t too surprising if you think about it: Europe is in recession , with debt crises rolling around the continent. Japan is in a shaky recovery from a recession last year, and China’s growth appears to be slowing sharply. The U.S. economy, meanwhile, is still doing OK, though data on Tuesday suggested manufacturing and home construction slowed toward the end of the first quarter. But there was another funny wrinkle in the survey: While foreign investors might see the U.S. as a safe haven, U.S. investors are starting to sour on the prospects for U.S. economic growth and corporate profits, according to the survey. “A net 8 percent of U.S.-based investors say the country’s economy will get stronger in the coming year, down from a net 29 percent in March,” BofA said. “A net 8 percent predicts corporate earnings will fall – last month, U.S. investors were evenly split on whether earnings would improve or deteriorate.” So far, global investors’ faith in U.S. stocks has been both tested and rewarded: By putting more money into U.S. stocks in March, global money managers suffered through the stock market’s mini-swoon in mid-April. But they may also be enjoying the market’s sudden, neck-breaking rebound, which continued on Tuesday, with the Dow Jones Industrial Average up 170 points at midday in New York , thanks in part to better-than-expected corporate earnings. This sort of market volatility, this unpredictability, is the sort of thing a lot of money managers hate. But it’s not nearly as bad yet as it was last fall, when a 170-point swing up or down in the Dow was considered a relatively calm day. And money managers globally are still more cautious than terrified, noted Michael Hartnett, chief stock strategist at BofA Merrill Lynch Global Research. Last fall, for example, the percentage of investors hoarding cash jumped to 30 percent and stayed there for months. And during the crisis about half of all money managers were parked in cash.

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Grandpa’s Old Suit Is Now A Wallet

April 17, 2012

You know what they say: One man’s trash is another man’s treasure. That’s the idea behind Jetsam, a fashion startup that uses discarded or unwanted fabrics, castoff clothing and vintage textiles to make wallets. The eco-friendly production model carries all the way down to the recycled gift box packaging. The creative mind behind Jetsam is Laura Skelton, a Columbia University graduate who comes from a background in sustainable architecture. Starting as a teenager, Skelton roamed thrift stores and costume departments to see what vintage items could be revived, modernized and made into something new. That eventually led to the idea for Jetsam, her line of sharply designed wallets, which retail for about $40 each. After success selling the wallets on Etsy in 2007 and an incredible fundraising campaign on Kickstarter , the visibility and exposure of Jetsam products has skyrocketed. Jetsam wallets are now in almost 100 stores across seven countries and have even found a spot at New York’s Museum of Modern Art. In the past Jetsam meant “unwanted material thrown overboard to lighten a ship’s load” — but now, Skelton is making the unwanted desirable again by taking historic, masculine textiles and re-configuring them for the future. You’ve been making products from vintage accessories since your teens. What about this process still gives you such joy? It’s a little hard to explain but it’s like I have this drive to create things with my hands. Even when I take a break from making products for Jetsam I ended up making these elaborate costumes and crazy installations just for fun. Part of what I really love about Jetsam is the challenge of tackling something with constraints. There’s only certain size pieces you can get out of an old necktie or an old jacket, so making them all work together can become a bit of a challenge. It’s sort of like putting a puzzle together. I get joy from it because it’s a combination of the satisfaction I get from making things but it’s also the intellectual satisfaction of solving these design puzzles. You’ve built your presence through different online forums like Etsy and Kickstarter. How else are you planning to grow your business? It was this crazy whirlwind thing at the beginning. I quit my job, started this artistic and creative company and moved to New Orleans and worked three jobs to make this all possible. I think I made over 3,000 wallets personally during this time. Then I built up this following through Etsy and also a series of craft fairs in different cities. I began this Kickstarter thing this past fall because as a broke artist you can’t come up with the capital needed to make that leap from being a one person shop to a mass production. So I turned to Kickstarter thinking I would just raise a little bit of funding to help get me started from friends and family. Then what happened was somehow the Reddit community got behind my idea It was this explosion of support for Jetsam from all over the world — something like 34 countries where people were excited about these wallets. On Reddit people are very honest, so it was nice to talk with people who liked my work but also to hear their criticisms and direct feedback on what new designs they wanted to see and how I could improve. Your project blew by that initial fundraising goal of $4,000 — you ended up raising $26,000 on Kickstarter . What kind of freedom has that extra money given you? I was able to ramp things up much more quickly. It’s a scary thing taking that leap to mass production and it gave me so much confidence having that support out there for what I was doing. On top of getting things on the fast track and getting in a secure position, when you’re manufacturing on this scale one of the big problems is cash flow. In order for me to produce this line on a large scale, I have to come up with enough capital to buy all these materials and keep with the labor for potentially months before I can see that cash back from the actual sale. Without that money I would have had to make a small batch, get my money back, then a medium batch, get my money back and then a large batch to get my money back. But that $26,000 upfront meant that I could make a huge batch as my first batch. I can’t see how any of that would have happened without the support of Kickstarter and the Reddit community. Do you think you’ll continue in the “time-honored style of male iconic figures” or branch out to other styles for different products as your brand grows? I’m working on a new collection right now actually, but I feel like that heritage menswear thing is just something that’s really speaking to me at the moment. Masculine style is really exciting right now and I’m sure as the line grows and matures that I will explore other things, but I think we’ll keep going with this sort of timeless debonaire feel. If you look at photos of men from 50 years ago they dressed incredibly well and they looked dapper in a masculine way. I think that’s something that got lost in the 90’s and early 2000’s, that’s kind of starting to come back now. I find that exciting especially because someone could be dressed in a modern style but you can pull out something like a wallet or an accessory that represents the elegance of a different era. Do you see the green and sustainable clothing model catching on with other products and companies? What do you feel the advantages are? I’ve got this mindset when I’m designing something that there are certain function requirements you have to meet. It has to work and it has to work well. The sustainable eco-friendly design is just one of those things that in the modern era we live is a basic component of the design for me. It is eco-friendly design but I try to have that be almost incidental because I think that in the age we live in all good designs should be sustainable. If you have a choice between making something with leftover or excess material versus making it with new material that’s good for the environment, it feels like basic common sense to take advantage of these wasted products. What’s exciting to me is how sustainability is being incorporated into mainstream design so that hopefully in five or 10 years, most of what you buy will be designed with sustainability in mind versus it being just a niche thing. What’s your advice to other entrepreneurs out there? The main piece of advice I would give is a parallel thing. One is to keep going and not get discouraged the first time something doesn’t work out and you have to go back to the drawing board, or if you design something you think is great and it’s not recieved well. The flip side of that is to really listen to the feedback that you give about your work, and use that to really strive to make your product as awesome as possible. I think there’s a tendency to dismiss critics as “haters” when really it’s sometimes the haters that can give you some of the most valuable insight into what you’re doing and how to make it better. I think when you’re striving for excellence in your business it’s important to have a sense of pride and confidence in what you’re doing but also a real openness to taking that feedback and improving all the time. Entrepreneur Spotlight Name: Laura Skelton Company: Jetsam Age: 28 Location: San Diego Founded: 2011 Employees: 1-3 Website: www.carryjetsam.com

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NFL Plays Ball With Gambling Industry

April 16, 2012

Despite the NFL’s vocal opposition to betting on its games, the league’s move to allow teams to accept casino ads has generated a great, big … ho-hum. Scott Andresen, a sports attorney and Northwestern professor, said the new deal is “somewhat hypocritical” but didn’t bother him, he told The Huffington Post Monday. It could even boost teams’ payroll, he said. University of Michigan sports economist Rodney Fort said the advertising could help fill the hotel and convention space attached to the casinos. “There’s nothing hypocritical about it.” The NFL last week approved local casino advertising at stadiums and during game broadcasts for the next two seasons, the Associated Press reported. The ads are limited to the upper bowl of the league’s venues, local radio broadcasts and in-game programs. They must also include a “gamble responsibly” message. Casinos that host sports betting are prohibited from advertising. The decision could represent a jackpot for teams like the Philadelphia Eagles, who have 20 casinos within driving distance of their stadium, the Philadelphia Inquirer reported Monday. The New York Jets and Giants could also both gain as much as $5 million apiece , the New York Post estimated. NFL spokesman Brian McCarthy clarified Monday that it was the teams that could accept the advertising, not the league. And the clubs were restricted in how they can deploy the marketing. “There is no use of team logos, no special sections or clubs sponsored by casinos, no events, no promotions, etc. This is in contrast to what other sports have done for years,” he wrote in an email to HuffPost. McCarthy had said in an earlier statement distributed to the media: “We remain steadfast in our opposition to the proliferation of gambling on NFL games. There is a distinction between accepting advertising in this limited fashion and gambling on the outcome of our games.” That said, Andresen pointed out football’s uncomfortable yet profitable relationship with gambling. “Let’s be honest: a substantial part of the NFL’s popularity is based in gambling activity or gaming of some sort, whether it’s sports books out in Vegas or parlay sheets or even fantasy leagues.” Concluded Andresen: “The hypocrisy has always been there.”

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Romney Campaign Soft-Pedals Private Remarks

April 16, 2012

PHILADELPHIA — Mitt Romney’s aides soft-pedaled his latest tax pronouncements on Monday, insisting he wasn’t tipping his hand when he told donors privately that he might seek to end the tax break for mortgages on second homes and curb other deductions for the wealthy as part of tax reform. “He was just discussing ideas that came up on the campaign trail,” said former Sen. Jim Talent of Missouri, a frequent campaign surrogate. The remarks, made at a closed-door fundraiser in Florida and overheard by reporters, did not mark any “change in policy,” Talent said on a conference call with reporters. Whatever his intention, Romney’s remarks drew a tepid response from Rep. Dave Camp, R-Mich., the chairman of the tax-writing House Ways and Means Committee. “I’m going to listen very carefully” to Romney’s ideas, the lawmaker told reporters. “Obviously, as a presidential candidate, he is going to have some ideas on tax reform.” Camp added: “They’re not necessarily views the committee has adopted yet. But we’re going to be looking at all those items.” Camp said he has spoken to Romney several times about tax policy. Twice during the day, Romney himself passed up an opportunity to repeat his weekend comments. Speaking to the Independence Hall Tea Party, he said he wants to reduce taxes while President Barack Obama wants to raise them. “Taxes by their very definition limit our freedom. They should be as small as possible to do things that are absolutely vital,” he said. Earlier, in an ABC interview, he said: “I’m going to limit certain deductions and exemptions for high-income individuals so that even as we lower the rates for all Americans, we’re not going to shift the burden from – middle-income people to higher-income people.” As for abolishing federal agencies, he said, “I’m not proposing any eliminations at this point.” In his remarks over the weekend, Romney also mentioned possible elimination of the Department of Housing and Urban Development, and dramatically scaling back the Education Department. Romney mentioned possible elimination of state and local tax deductions for the wealthy as part of a plan to reduce income tax rates across the board. Democrats quickly accused the former Massachusetts governor of telling his financial supporters plans he has yet to share with the public. Ironically, the weekend fundraising flap took place less than two weeks after Romney accused Obama of conducting a “hide and seek” campaign in which he left the public in the dark about his plans for any second term. If nothing else, the attention Romney’s remarks drew underscored the increased scrutiny he faces as the party’s presidential nominee-in-waiting. With former Sen. Rick Santorum on the sidelines after suspending his campaign, Romney was campaigning across Pennsylvania for two days in advance of next week’s primary, then flying to North Carolina and Arizona. Romney has said he wants to keep all the broad tax cuts from expiring that were first approved under President George W. Bush. He also has said he wants to reduce tax rates by 20 percent, but he has not previously offered much detail about how he would pay for the costs of doing that. Nor has he defined an income level that would place a taxpayer in the class of the wealthy. Democrats have favored extending the Bush tax cuts, but not for the wealthiest Americans. Tax treatment of the rich has become a defining issue in this year’s presidential and congressional campaigns as the two parties vie for votes, with each arguing that it has the best ideas for reviving the economy. Romney’s weekend remarks were first reported by The Wall Street Journal and NBC News. ___ Fram reported from Washington.

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Coffee Prices Fall To Lowest Level In 18 Months

April 16, 2012

— Coffee prices fell to their lowest level in 18 months Monday on expectations that Brazilian growers will produce a robust harvest. Coffee fell 4.5 cents to end at $1.747 per pound Monday. That’s the lowest level since Oct. 7, 2010, when the price was $1.7345 per pound. Good weather during the growing season has triggered speculation that Brazil will produce large quantities of coffee when the harvest gets under way in June. That is expected to offset lower production in Colombia, which has had large amounts of rainfall. At the same time, demand appears to remain strong globally. That’s causing some confusion among traders and analysts about where the market is headed, said Jack Scoville, vice president of Price Futures Group. Despite the falling futures prices, coffee drinkers aren’t likely to see much change at the retail level because businesses still are paying more to produce and ship products, analysts have said. In other trading, prices for corn and wheat fell after weekend rains scattered across fields from the Dakotas to southern Texas. Although it’s early in the planting season, the rains should benefit crops in the field and moisten fields that are being readied for planting, said Northstar Commodity analyst Jason Ward said. Investors speculated that could improve yields at harvest time. In May contracts, wheat dropped 7.25 cents to $6.1625 per bushel, corn decreased 6 cents to $6.2325 per bushel and soybeans ended down 16.75 cents at $14.20 per bushel. Wet weather also may have played a factor in falling cotton prices, Scoville said. May cotton fell 4 cents, or 4.3 percent, to 88.08 cents per pound. Other commodities were mixed after lingering concerns about Europe’s debt problems overshadowed stronger-than-expected U.S. retail sales. Spain’s borrowing costs climbed above 6 percent rate mark before falling back to 5.96 percent later Monday. In the U.S., retail sales rose 0.8 percent in March, twice as much as analysts had expected. Gold for June delivery fell $10.50 to finish at $1,649.70 an ounce and May silver dropped 1.7 cents to $31.373 an ounce, May copper rose 0.1 cent to $3.628 per pound, July platinum fell $12.10 to $1,575.80 an ounce and June palladium increased $3.50 to $650.70 an ounce. Benchmark oil rose 10 cents to finish at $102.93 per barrel on the New York Mercantile Exchange. Heating oil fell 5.8 cents to $3.1166 per gallon, gasoline futures decreased 7.91 cents to $3.267 per gallon and natural gas rose 3.5 cents to $2.016 per 1,000 cubic feet.

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The Faddish Past And Big Money Future Of Chia Seeds

April 16, 2012

Five years ago, the word “chia” made most Americans think of one thing: Chia Pets. The association lingers. But today, chia seeds are beginning to gain recognition as one of the world’s healthiest foods. The seeds, which are completely tasteless, are high in protein and fiber and contain incredibly high levels of Omega-3 fatty acids, which have been shown to protect function of the heart and other vital organs. The shelves of Whole Foods are brimming with chia-packed products, from juices to energy bars. You can buy four one-pound bags of raw chia seed at Walmart for $37.56. “Chia could be the next big superfood,” John Roulac, CEO of Nutiva Foods, the leading producer of organic chia, told The Huffington Post. “The growth in demand for chia is almost like a hurricane, it’s so intense.” What makes that transformation so remarkable is that for centuries, almost no one was even aware that chia seeds were edible. Chia had been the third-most important crop for the Aztec empire, after corn and beans. But because it was used in Aztec religious ceremonies, conquistadors suppressed its cultivation by all but a few remote tribes for 500 years. Wayne Coates, an ultramarathon-running professor of agricultural engineering at the University of Arizona, entered the picture in 1991. He was trying to find a profitable crop that could be grown in northwest Argentina, as part of a project he was working on with Argentinian farmers. Someone — he said he doesn’t remember who — suggested chia. He found that it was easy to grow, so he started to investigate its potential uses. What he found astounded him. “Chia is the highest plant source of Omega-3s. It has tons of fiber, and even a lot of antioxidants and minerals. It’s 20 percent protein — which is, compared to wheat, or even soy, incredibly high,” Coates told The Huffington Post. Further analysis convinced him chia had vast potential. Initially, he thought it might work well in livestock feed, to increase the amount of Omega-3s that made it into eggs and milk. That worked, but the relatively high price of chia kept farmers away. So Coates started to think about selling chia directly to consumers instead. He began visiting trade fairs, hoping to find a company that would include chia seeds in its products, but he said no one wanted to be the first to bet on an unproven ingredient. In 2005, Coates published a book on the topic entitled “Chia: Redisovering A Forgotten Crop Of The Aztecs,” but it attracted little notice outside of his native Arizona. But in the late 2000s, two high-profile supporters emerged. Dr. Mehmet Oz started promoting chia as a “superfood” on “Oprah.” He showed fans how to incorporate chia into their diets by adding it to smoothies and to muffins. His endorsement encouraged health-food early adopters — who were eager for a new fad after tiring of acai and pomegranate — to seek out chia seeds. Then chia was featured in Christopher McDougall’s “Born To Run,” a best-selling inspirational tract for runners. McDougall profiled a legendary long-distance runner named Micah True, who learned about chia from the Tarahumara tribe of native Mexicans. The book increased awareness of chia in the athletic community. Chia sales skyrocketed, and Coates quickly found that its popularity had ballooned far beyond what he had imagined. (His second chia-related book, “Chia: The Complete Guide To The Ultimate Superfood,” comes complete with recipes and will be released on May 1.) New companies, including Nutiva, began producing it, as many others in the food industry began to realize that the seeds’ blandness gave them a wide range of potential applications. One such person is Janie Campbell, a self-declared health food nut from Southern California and the founder of beverage company Mamma Chia. She started adding chia to juice after realizing that it worked to reduce symptoms of an autoimmune disorder she’d faced for decades. Campbell said her friends were so enthusiastic that she decided to sell the juices commercially in 2010. Mamma Chia is now available in 2000 stores, including most Whole Foods locations. As the chia market became more competitive, people began to make bold claims about the seeds’ benefits. Many — including Coates — started to say that chia seeds help people lose weight, that chia seeds increase energy and that they lower peoples’ cholesterol. The problem was that controlled studies had continually failed to bear those claims out. “The people who are involved in the chia seed world are almost like a cult,” said David Nieman, a doctor who has conducted numerous studies on chia seeds. “They just think it’s god’s gift to mankind, that it can do all sorts of magical things. But it’s not true.” The cautionary tale in this arena is that of the acai berry. It, too, was a newly-introduced food from South America that was often billed as a “superfood.” And it, too, started to attract unsupportable claims, which ultimately sullied its image in the eyes of many consumers. For that reason, those who market chia seeds have shifted their focus away from specific health claims and toward simple statements about the uncontroversial nutritiousness of the chia seed. April Hallaway, head of marketing for Australia’s The Chia Company, which now grows nearly half the world’s chia, explained, “The last thing we do is to market chia as a fad.” In Australia, the seeds’ appeal stretches far beyond health food nuts and athletes. They’re included in foods as pedestrian as mass-market white bread. But before that can happen in the U.S., many argue that the supply of chia — currently dominated by The Chia Company and small farms in Latin America — needs to become more reliable. Enter Kentucky Chia, founded by a group of business students at the University of Louisville with the goal of making chia into a commodity crop. The company holds the patent for a new strain of chia that can be grown in the U.S., which was developed using a process that accelerates genetic mutation using gamma rays. (The technique does not technically qualify as genetic modification, but it’s close enough to unnerve traditional chia fans like Coates and Roulac.) Kentucky Chia hopes to start selling its chia as horse feed in 2013. But CEO Zack Pennington says that’s only the beginning. “Right now, we mostly eat chia raw, by itself, but I think its ultimate trajectory is as an ingredient,” he told The Huffington Post. “Sometime soon, I think we’ll see chia added to everything: Vitamin Water with chia, Kashi cereal with chia, chia-seed bread at Subway.” Is he worried, though, that chia might just be a temporary fad — as its terra cotta brethren turned out to be? “As long as people recognize not only how good it is, but also its limitations, it will last,” he said. “iPods were a trend — and now they’re just part of your daily life. That’s where we think chia seeds are headed.”

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Toy Company Allegedly Laundered Drug Money

April 16, 2012

LOS ANGELES — Five people were arrested Monday in connection with a money laundering scheme that allegedly funneled millions of dollars in Colombian and Mexican drug money through an American toy company, federal officials said. Immigration and Customs Enforcement said the two owners of Industry-based Woody Toys and three company employees were arrested on charges of evading federal reporting requirements for financial transactions. Two Mexican toy dealers were arrested earlier this month in the case on similar charges, the agency said in a statement. Woody’s co-owner Jia Hui Zhou and toy dealer Luis Ernesto Flores Rivera are also charged with conspiring to launder money in a scheme that officials said channeled at least $6 million to the California toy company between 2005 and 2011. The case is the second involving a Los Angeles-area toy company accused of laundering drug profits and comes as countries such as Mexico tighten banking regulations, said Claude Arnold, special agent in charge for ICE homeland security investigations in Los Angeles. “They can’t walk up with duffel bags of money and continue with their business,” Arnold said. “They have to find creative ways to convert that money into pesos and launder it so it doesn’t look like illegal proceeds.” All seven of the defendants were due in federal court in Los Angeles Monday afternoon. The indictment was handed up last week against the seven defendants and the company. A message was left for Zhou’s attorney, David Elden. Flores Rivera had no attorney listed as of Monday afternoon, ICE officials said. The Mexican toy dealers bought U.S. dollars made off drug sales from currency brokers in a “black market peso exchange,” officials said. That exchange enabled drug traffickers to get rid of drug dollars and gave the toy dealers a more favorable exchange rate so they could then purchase toys in the United States, authorities said. The dealers would then send the money to Woody Toys via courier or bank deposits. Authorities said Woody Toys failed to file required paperwork when the company received deposits of more than $10,000 and also intentionally structured bank deposits in smaller increments to avoid having to do so. If convicted of evading federal reporting requirements, the defendants could face up to five years in prison. The money laundering charge can carry a sentence of up to 20 years in prison. The investigation started in November 2010 following a money laundering probe at Los Angeles-area toy wholesaler Angel Toy. That company’s two top executives were sentenced earlier this year to more than three years in prison after pleading guilty to conspiracy to structure currency transactions. The probe into Woody Toys – which features teddy bears and blond-haired dolls on its website – was carried out by immigration officials, Internal Revenue Service investigators and a Southern California task force headed by the Drug Enforcement Administration. No one at the company’s offices in Industry would comment for this story.

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Anheuser-Busch Pays $1.24 Billion For Majority Stake In Presidente Beer

April 16, 2012

BRUSSELS — Anheuser-Busch InBev says it is paying $1.24 billion for a majority stake in Dominican brewer Cerveceria Nacional Dominicana as it pushes deeper into the Caribbean. AB InBev said Monday it is paying $1 billion to Cerveceria Nacional Dominicana’s parent company Grupo Leon Jimenes for a 41.8 percent stake in a holding company that will own 83.5 percent of Cerveceria Nacional Dominicana. The holding company will also include AB InBev’s Dominican subsidiary AmBev Dominicana. On top of that, it will pay $237 million for Heineken’s 9.3 percent stake in Cerveceria Nacional Dominicana, which will leave AB InBev with 51 percent of Cerveceria Nacional Dominicana. Belgium-based AB InBev says the deal will “create the leading beverage company in the Caribbean.” It will sell Cerveceria Nacional Dominicana’s popular Presidente beer brand as well as malt and soft drinks.

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Meet The Company Behind Hologram Tupac

April 16, 2012

A hologram of deceased rapper Tupac Shakur stole the show at Coachella 2012, capturing the fascination of more than 100,000 fans at the annual music festival, and sparking a wave of reactions across Twitter and other social media. Accolades for the high-definition projection, which performed as part of a live set by rappers Snoop Dogg and Dr. Dre, lauded it for its impeccable details. The lifelike hologram captured ‘Pac’s athletic swagger and iconic swag as it romped around the stage, brandishing tattoos and Timberland boots. Details like these are what allow audiences, even large ones like at Coachella, to suspend disbelief. Fortunately, such details happen to be the speciality of AV Concepts , the production company that so convincingly resurrected Tupac. As a small company in a competitive industry , it must to prioritize client relationships and adopt new technology to succeed — and pave the way forward. Their latest win is just case-in-point. In an interview with MTV , AV Concepts president Nick Smith said that his company worked meticulously with the project’s mastermind, Dr. Dre. Everything about the hologram, from its movements to its clothing, was “recreated under the direction of Dre and his team,” according to MTV. The Tupac hologram “was [Dr. Dre's] idea from the very beginning and we worked with him and his camp to utilize the technology to make it come to life,” Smith told MTV. The technology in question uses “uncompressed [high-definition] video that can be projected as holograms… or as 3D imagery on building exteriors, interior walls, stage sets and other structures,” according to the Sun-Herald. AV Concepts previously produced HD graphics for Chris Brown’s performance at the 2012 Grammys , and has flaunted its holographic projections at the San Diego Convention Center. While Smith would not divulge an exact cost for the Coachella hologram to MTV, he offered a price range for a comprable event at between $100,000 to more than $400,000. He called the pricing “affordable” compared to the cost of pulling in entertainers form around the world to preform at concerts. As live visual performance technology such as Musion Eyeliner , the holographic projection system utilized by AV Concepts and its partner in the Coachella endeavor, Digital Domain Productions , becomes increasingly sophisticated, it might pave the way for a new kind of entertainment experience. While AV Concepts has helped other groups, such as Gorillaz, utilize holographic technology, their Tupac seems to have broken new ground in realistic rendering. If companies can deliver a convincing live hologram performance for less what it costs to send a band on tour, this resurrection might signal a new dawn for live entertainment. With the right technology, companies can “take people that haven’t done concerts before or perform music they haven’t sung and digitally recreate it,” Smith told MTV . This is to say nothing of the priceless opportunity given to hip-hop fans at Coachella. Hologram Tupac might be an elaborate surrogate, but to many, including real live perfomers like Rhianna and the Roots’ Questlove , the vibe was real enough. Imagine what it might mean to fans of the Beatles to see a live, hologram-performed rendition of “Sgt. Pepper’s Lonely Hearts Club Band.” The Huffington Post attempted to contact AV Concepts for comment via phone and e-mail, but no reply was received by press time. WATCH: Madonna Performs With Hologram Gorillaz

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Private Equity Doing Just Fine, Thanks

April 16, 2012

The boom times are back, sort of, for private equity, but don’t break out the champagne just yet. More companies backed by private equity went public or were sold in the first quarter of this year than in any first quarter since 2007, according to data from the private equity research company PitchBook Data, as CNN Money reported . During the first quarter of this year, private equity firms either sold or took public 112 companies, bringing in roughly $21 billion. That represents a 17 percent increase from the first quarter of last year, when 96 private equity-backed companies were sold or issued shares to the public, according to PitchBook. “A lot of things are gradually improving,” John Gabbert, founder and CEO of PitchBook, told The Huffington Post. While this marks the best first quarter for private-equity firms selling their stakes since 2007 — a big year for private equity deals — it’s too early to say if the market is back to full health. To put the latest results in perspective, private-equity firms sold or took public a total of 510 companies during all of 2007. Kathy Smith, a principal at Renaissance Capital, an institutional research and asset management company focusing on IPOs, said, “2012 looks like a good year to me.” But, “the markets are still volatile; we’re not really out of the woods with all of this panic,”added Smith, referring to the stock markets. “And when you get panic, you get a shutdown of the IPO market.” Last week, California solar power developer BrightSource Energy announced that it was withdrawing its IPO, citing poor market conditions. Meanwhile some large-scale private equity firms have been taking themselves public as well, with lackluster results. Last week, the IPO of private equity firm Oak Tree Capital Group proved lackluster when the firm raised 27 percent less than the amount expected after the shares premiered. On Monday, the Caryle Group announced plans to make 10 percent of its firm available for public trading. The firm’s valuation would be just slightly more than $7 billion , a fairly cautious estimate, ranking it below rivals Blackstone and KKR, according to Bloomberg . Contributing to the recent boom might be the plum tax benefits that private equity firms enjoy when they spin off a company, as CNNMoney noted. Revenues from the sale of a company owned by a private equity firm are currently taxed at the 15 percent capital gains rate, which matches the rate that partners of private equity firms personally pay on the profits from their deals. (This compares with the top tax rate on income of 35 percent, as CNNMoney pointed out.) Venture capital-backed IPOs are off to a good start this year as well. Twenty U.S.-based venture capital-funded companies went public in the first quarter, raising a total of $1.4 billion. That makes it the most active period since the fourth quarter of 2007, which had 27 VC-backed IPOs raising $2.1 billion, according to data from Dow Jones VentureSource. Yet, in spite of the massive, well-publicized $1 billion acquisition of VC-backed Instagram by Facebook last week , the market for venture capital-backed acquisitions — that is, one company buying another company financed by VC funding — is down, according to VentureSource. Ninety-four VC-backed companies were acquired in the first quarter, raising 18.1 billion — a 32 percent decrease from the same period last year.

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Ben Hecht: Mainstreaming Social Innovation With the Public Sector

April 16, 2012

Social innovation has been a hot topic for a number of years now, but never more so than today. Conferences, awards, magazines, even a White House-led Social Innovation Fund, are dedicated to it. And for good reason. People have lost confidence in the institutions that they historically relied upon to solve our most pressing problems. Leaders have realized that if they want to change the status quo in their lifetimes, they need to stop waiting and start building their own solutions. More often than not, however, when we refer to social innovation, what we really mean is innovation sponsored by the social sector (“social sector innovation”). We’re talking about nonprofits created to fill gaps in a terribly broken system, such as connecting patients and their families with the basic resources they need to be healthy ( HealthLeads ) or providing urban young adults with the skills, experience and support that they need to reach their potential through professional careers and higher education ( YearUp ). Organizations like Echoing Green , Ashoka and New Profit , have accelerated the creation of a social sector innovation field by supporting the emerging leaders of these organizations with grants, business planning and connecting them to a network of similar ‘social entrepreneurs.’ As I stood atop the trading floor of the New York Stock Exchange (NYSE) last Wednesday however, I realized how incredibly self-defeating this narrow definition of social innovation is if large scale change is our goal. I was literally witnessing one of the most effective and lasting social innovations in the U.S. and it had been done by the public sector. The more I thought about it, the more I realized that public sector-led social innovation (“public sector innovation”) differs from social sector innovation in one absolutely fundamental way: it actually has a much better chance of having permanent, lasting impact from the outset. Many social sector innovations, like ones I’ve helped lead over the past 20 years, toil for years to build a successful model and then struggle for years thereafter to both get the attention of government and the adoption of the model by the public sector. In contrast, public sector innovation is undertaken with the assumption that if it is successful, it will go straight, “intravenously” into effect. No annual fundraising or advocacy necessary. The innovation and related funding will quickly displace the old way that government did business. For instance, what Linda I. Gibbs, New York City’s Deputy Mayor for Health and Human Services, has done in New York is one example of the extraordinary power of public sector innovation strategies. After her appointment, Gibbs created the Center for Economic Opportunity (CEO) to design and implement evidence-based initiatives to reduce poverty. On the policy side, the Center developed an updated poverty measure that it not only adopted but has also been adopted by the Obama Administration. On the program side, for example, CEO created Financial Empowerment Centers to help citizens take control of debt, improve credit ratings, deal with debt collection and learn to create budgets. After serving over 13,800 residents, helping them to reduce over $6.9 million in debt, build more than $900,000 in savings and achieve financial stability, the innovation went straight into the mainstream — it’s now the way the city does business. Not a pilot. Nice but that’s not all especially given how cities compete with their peers. In 2008, Mayor Michael Bloomberg of New York City and then-Mayor Gavin Newsom of San Francisco, two mayors committed to this issue, created the Cities for Financial Empowerment (CFE) Coalition . Since then, a dozen cities have come together to share promising approaches, build a unified policy program and adopt innovations into their mainstream operations. I was standing atop the NYSE because I was celebrating, with CFE co-chairs Jonathan Mintz, NYC Department of Consumer Affairs Commissioner, and José Cisneros, City of San Francisco Treasurer, the announcement of The Cities for Financial Empowerment Fund (CFE Fund) at Living Cities as part of NYSE’s Financial Literacy Week. The Fund will institutionalize this loose-knit collaboration of cities interested in financial empowerment. In essence, it will help cities to skip a generation of innovation and go right to intravenous adoption of what works. We need to do more to celebrate and replicate these types of successes. We need to honor the vision of public sector innovation trailblazers like Linda Gibbs, Jonathan Mintz and Jose Cisneros as much as we honor the extraordinary efforts of social sector innovation leaders like Wendy Kopp and Geoffrey Canada. The more the better.

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Fed Officials Leave For Wall Street With Privileged Info

April 16, 2012

WASHINGTON — The Federal Reserve may be making an effort to open up some of its famously opaque decision making, but the newfound interest in transparency doesn’t extend to sharing records of meetings that happened years ago. The Huffington Post and MSNBC’s “Dylan Ratigan Show” filed Freedom of Information Act requests in January to obtain the minutes of Federal Open Market Committee meetings from 2007 to 2010. That month, the Fed had released the 2006 minutes of the confidential committee, which essentially sets national monetary policy. In response, the bank provided 513 pages of mostly blacked-out paper and cited policy to justify withholding the information. “[T]he Committee has a long-standing policy of routinely releasing full transcripts on a five-year schedule. Each year’s transcripts will be made public in their entirety according to that schedule,” the bank offered by way of explanation. By withholding the 2007 and 2008 minutes, the Fed is able to keep secret certain information on how it decided to respond to the financial crisis until after the presidential election, hampering what could be a serious debate between the two parties on its response. During the financial crisis, Mitt Romney was broadly supportive of the federal response, with the exception of the bailout of the auto industry. He has since spoken much more skeptically of the Wall Street bailout. Barack Obama, as a candidate and then as president, spoke favorably of the federal intervention as unfortunate but necessary. On Friday, his Treasury Department released a full-throated defense of its activity. How the Fed made its decisions, however, will be kept hidden until the bank releases the transcripts year by year. “The Federal Reserve has been looking for ways to increase its transparency now for many years, and we’ve made a lot of progress,” Fed Chairman Ben Bernanke said in April 2011, as he embarked on a series of lectures aimed at defending the Fed. “We have become, I think, a very — a very transparent central bank.” Bernanke said the bank would continue to improve. “We’re continuing to look for additional things that we can do to be more transparent and more accountable,” he said a year ago. “And I personally have always been a big believer in providing as much information as you can to help the public understand what you’re doing, to help the markets understand what you’re doing, and to be accountable to the public for what you’re doing.” There are some market participants, however, who know exactly what happened in those meetings. One of the few things not redacted in the Fed’s FOIA response is the list of officials who attended each confidential meeting. Many of those people have since left the central bank and gone to work in the financial industry, taking with them privileged information about the Fed’s thinking that is still closed to the public. Take Susan Bies. A onetime member of the Fed Board of Governors, she was involved with the Financial Stability Forum, an international group of central bankers, finance ministers and the like, and, according to Forbes , “led the Fed’s efforts to modernize the Basel capital accord.” Bies now sits on Bank of America’s board. Brian Sack has cycled between the Fed and the private sector more than once. In 2009, he returned to manage the System Open Market Account. Bernanke said at the time, “Many of you know Brian, I am sure. He was here. He went off to work with Larry Meyer for awhile. Now we welcome him back to the Fed family.” Laurence Meyer was himself a top Fed governor who left in 2002 to return to the firm he founded, Macroeconomic Advisers, which offers economic forecasts. David Stockton, another Fed official who attended Federal Open Market Committee meetings in question, also departed to join Meyer’s firm. In 2012, Sack once again left the Fed . Deborah Bailey has since gone on to Deloitte & Touche, where she is director of governance, regulatory and risk strategies. Meredith Beechey is now at Sveriges Riksbank, Paul Connolly is at Eastern Bank/John Hancock Life Insurance Co., and Benson Durham is at the Capital Group Companies. Joseph Gagnon, Michael Gapen and Jon Greenlee have moved on to the Peterson Institute, Barclays Capital and KPMG, respectively. Brian Madigan also went to Barclays, and Nathan Sheets is now at Citigroup. At least eight other meeting participants have moved on to private financial institutions. Clients deeply value the kind of insight a former Fed insider can bring — a value Citi didn’t overlook in its announcement of Sheets’ hiring, which featured this quote : “With over 18 years of experience with the Federal Reserve, Nathan’s appointment underscores Citi’s commitment to bring the highest quality insights to our clients.” Jason Cherkis contributed reporting to this story.

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How To Get Free Stuff On Tax Day

April 16, 2012

Now that most of us have filed our tax returns to Uncle Sam, it’s finally time to celebrate the end of tax season. The following business are providing discounted food offers to give American taxpayers a little extra relief. Here’s a round-up of food freebies available on Tax Day:

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Allen West: Under Obama, The ‘American Republic Will Collapse’

April 16, 2012

Days after stirring the political pot by calling Democratic members of Congress communists , Rep. Allen West (R-Fla.) was back in front of a microphone, taking aim at President Barack Obama’s performance in handling the debt crisis. Conservative New Media caught up with West at Palm Beach County’s Tea Party “Tax Day” event on Sunday . The freshman congressman was asked whether Obama and Democrats were really addressing the debt crisis. He answered no, linking some ancient political thinking to the modern situation. “It’s much the same as Alexis de Tocqueville talked about in ‘Democracy In America’ — that this American republic will collapse once Congress and obviously our president realizes they can bribe the public by using the public’s treasury,” West said. West drew headlines last week for his Tuesday town hall remarks , where he noted that he believes there are “about 78 to 81 members of the Democrat party who are members of the Communist Party.” Rep. Barney Frank (D-Mass.) headed the House Democrats’ response, noting that “not even Joe McCarthy would have said anything so stupid and dissociated from reality.” From a fundraising standpoint, the reality is that West continues to do well. The Palm Beach Post reports that the Tea Party favorite raised more than $1.8 million during 2012′s first quarter. His GOP primary opponent, Martin County Sheriff Robert Crowder, managed only $26,800 during his first month on the campaign trail.

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World Bank Taps Obama Nominee As New Leader

April 16, 2012

The World Bank has selected Jim Yong Kim to be its next president , Reuters reports. Kim, the president of Dartmouth and a leader in the field of public health, was up against Nigerian Finance Minister Ngozi Okonjo-Iweala. Ex-Colombian finance minister Jose Antonio Ocampo dropped his bid for the position on Sunday. This is a developing story, check back for updates.

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Dueling Tax Proposals Affecting Small Businesses, Millionaires May Be Doomed

April 16, 2012

WASHINGTON — Democrats and Republicans are forcing votes in Congress this coming week on competing tax plans that affect millionaires and smaller businesses, and they know the proposals are doomed from the start. But that doesn’t matter to either party. Their efforts, including a Senate vote Monday on President Barack Obama’s “Buffett rule” proposal to impose a minimum tax on the wealthiest Americans, are more about pontificating than legislating, aimed at voters in November’s congressional and presidential elections. Neutral economists say neither bill would do much for the economy or job creation. Some political professionals are equally unimpressed with their potential impact on voters. Undaunted, congressional leaders hope to maximize public attention by timing both roll calls with an eye to Tuesday, the annual deadline for filing income taxes with the Internal Revenue Service. The upcoming votes probably are just a start. Senate Democrats later this year may hold additional votes tied to the “Buffett rule,” using his idea of a minimum 30 percent tax on top earners to raise money for proposal to create jobs and keep student loan rates from rising. With trillions in tax cuts dating from President George W. Bush set to expire in January, House and Senate leaders also are considering campaign-season votes on extending popular parts of those reductions, such as preventing the $1,000 child tax credit from being cut in half. In addition, Obama and his all-but-certain GOP opponent, Mitt Romney, will spend much of the campaign promoting their tax blueprints as antidotes to an economy still struggling to generate jobs. Besides raising taxes on the wealthy, Obama would boost levies on many U.S. companies that do business overseas, and on the oil and gas industry. The new money would help lower individual and corporate rates and reduce federal deficits. Romney would continue all Bush tax cuts, including those for the richest people, while trimming rates and eliminating estate taxes. “If this were a heavyweight fight, we’re still in the first round where both sides are kind of feeling each other out,” Republican consultant Mike McKenna said about the votes in the week ahead. On Monday, as Congress returns from a two-week spring break, the Democratic-led Senate expect votes on a “Buffett rule” measure by Sen. Sheldon Whitehouse, D-R.I. It would slap a minimum 30 percent income tax on people making over $2 million yearly and phase in higher taxes for those earning at least $1 million. Republicans are sure to block the bill, nicknamed for billionaire Warren Buffett, who backs higher taxes on the rich. The GOP-run House plans a Thursday vote on legislation providing a 20 percent tax deduction for businesses that employ fewer than 500 workers, which covers 99.9 percent of all companies. The proposal, sponsored by House Majority Leader Eric Cantor, R-Va., seems certain to pass, but fail in the Senate. Those votes are set just as many Americans stare at their own tax returns. The Internal Revenue Service says that through April 6, it had received 99 million of 145 million expected returns. So far, 80 million refunds have been issued averaging $2,794, down $101 from last year. For political leaders looking ahead to the November elections, the demise of this week’s bills will matter little. Democrats think the Buffett rule vote will underscore their commitment to economic fairness and GOP favoritism for the rich, a prominent election theme. Hammering at it lets Obama shine a spotlight on Romney, a former private equity executive who has paid an income tax rate of about 15 percent on annual earnings of $21 million, which is a lower rate than many middle-class families pay. “It’s simple. If you make more than $1 million every year, you should pay at least the same percentage of your income in taxes as middle-class families do,” Obama said Saturday in his weekly broadcast address. Republicans believe the business tax measure will spotlight their efforts to lower taxes and create jobs, contrasted with Democrats’ preference for higher taxes to finance ever-larger government. They believe they win the debate by keeping the focus on those subjects, not what the wealthy pay. “We want small-business people to have more money go to their pockets, not the government’s,” Cantor said recently at a Virginia high school. “And then they have more money to make decisions about hiring, about retaining jobs and about creating more jobs.” Democratic political consultant Alan Secrest said both measures might excite the most fervent partisans but do little for independents, who he said care more about jobs. “And neither party has a particular advantage on that right now,” Secrest said. The Buffett rule is clearly popular. An Associated Press-GfK poll in February showed that nearly 2 in 3 favor a 30 percent tax for those making $1 million annually, including most Democrats and independents and even 4 in 10 Republicans. Yet the measure would raise just $47 billion over a decade, a smidgen of the $7 trillion in federal deficits expected during that time. While a 20 percent tax deduction would be welcomed by any company, the $46 billion in lower taxes Cantor’s bill would provide over the next six years would barely register on the $100 trillion in U.S. economic activity projected for that period. There also are doubts that it would spur new jobs. “If they have more sales, they’ll hire,” said Maury Harris, chief U.S. economist for UBS, the investment bank. “If they don’t have the sales, they won’t hire. That’s what it’s all about.” Senate Democrats, who champion a narrower bill providing tax credits for firms hiring workers, call the GOP small-business cuts “a profit-padding tax giveaway.” Democrats have also criticized extending Bush’s tax cuts for being too costly at a time of big budget deficits, though most favor extending them for all but the highest earners. Rep. Dave Camp, chairman of the House Ways and Means Committee, said the business tax cut bill would show that Republicans are trying to spark job growth. He also said he would welcome Democratic opposition to any votes this year, should they occur, on renewing Bush’s tax cuts. “If the Democrats want to have all those taxes go up, let them,” said Camp, R-Mich.

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Former Kidnapping Victim Starts A Business

April 16, 2012

Around 11 a.m. on May 30, 1999, Luis Iragorri, then the owner of several franchised restaurants in Cali, Colombia, became an unwitting participant in a news story that made international headlines. While in church, he, his two youngest children and about 120 other parishioners were kidnapped by the guerilla army, National Liberation Army ELN. After fighting daily to survive, Iragorri, 52, moved to Miami, where he is now a co-founder of BannaStrow’s, which sells crepes and coffee . There are currently six franchise units open in Florida, with five more opening within the next six months and another 100 in development. Though the business is growing, that it exists at all is something Iragorri is grateful for. After all, if things had worked out a little differently … Kidnapped About two hours after being hauled up to a small village in the mountains and herded into a building that seemed to be a gymnasium, the guerilla army began separating about 80 men from the women and children. When one of the guerillas told Iragorri to move away from his 3-year-old son, Daniel, and his 6-year-old daughter, Marcela, he protested. At that moment, the guerilla pointed his gun to Iragorri’s head and barked, “Either you start walking, or I will shoot you right here in front of your children.” Iragorri obliged, knowing that trying to play James Bond would just get him and his children killed. His children were distraught, as all the kids and adults in the building were. Women and children were screaming. Men were yelling. It was a nightmare in the middle of the day. Thirteen years later, it’s still difficult for Iragorri to discuss. “Whenever you think your day isn’t going well, you just remember this,” said Mauricio Acevedo, a business partner and co-founder who also translates for Irragori. Several hours after Irragori’s kids were taken away, one of the guerilla army guards loaned him a radio, and he heard on the news that the women and children were liberated, which gave him hope for his own kids. Three days later, the Colombian government sent an army plane overhead, dumping newspapers on them, hoping some might reach the captors and give them hope. It did. Iragorri found a newspaper with a photo on the front page, showing his son being handed to his wife, Margarita. After that, Iragorri’s personal motto would be Sobrevivir , which translates, “I need to survive.” He vowed to eat everything his captors gave him and do his best not to get sick. “If I would have gotten sick, I would have died,” Iragorri said. Iragorri was split into a smaller group with 10 other men and, for the next six months, moved to a new camp every night. Freezing, Iragorri kept himself alive by stuffing newspapers into his clothing for warmth. Meanwhile, the number of kidnapping victims grew smaller as family members handed over ransom payments. It took Iragorri a while to be released because his kidnappers were slow to understand that he was a franchisee — they thought he was a franchisor, owning the entire system, and believed he was far wealthier than he actually was. Margarita came into the mountains 18 times to negotiate with the guerilla army before they would accept the ransom and let him go. Several months later, Iragorri was threatened by the kidnappers again — who didn’t appreciate Margarita denouncing them in the news. In 2000, Iragorri obtained a visa for his wife and kids and moved to the United States, where he was given political asylum and was allowed to apply for American citizenship, which he will finally achieve next year. But his kidnapping reverberated badly in so many ways. Not only did he arrive in America with virtually nothing, he had to shut down the restaurants he owned. About 140 people were put out of work when Iragorri fled the country. Starting Over After Iragorri and his family moved to Miami, he considered how he would make a living. He hoped to do something in food, since that was his background. He didn’t have the money to buy a franchise, and he knew if he started one, it could be a fool’s errand to open up another burger, pizza or chicken joint and compete with all the established eateries on every corner. He started brainstorming ideas for a food that could be eaten during any time of the day, something easy to operate and that wouldn’t be labor intensive. And he wanted a food product where he wouldn’t be fighting against an army of competitors. Ultimately, he came up with the idea of selling the public on crepes. “It’s the perfect product for a successful food concept,” Iragorri said. But being practically penniless and not knowing the language, Iragorri needed some help to get his company going. He found the help in Juan Estrada, whom he had worked with as a franchisee. Estrada introduced Iragorri to Acevedo, and in 2003, the three men opened BannaStrow’s — a play on banana and strawberry, their two initial key ingredients in the crepes. In 2009, they started franchising, selling the BannaStrow’s units for $130,000 to $195,000, with a franchise fee of $30,000. “Everyone who tastes the crepes comes back,” Iragorri said. And if the crepes don’t catch on? Well, Iragorri has been through worse. Entrepreneur Spotlight Names: Luis Iragorri, Mauricio Acevedo, Juan Estrada Company: BannaStrow’s Ages: 52, 41, 30 Location: Miami Founded: June 2003 Employees: Six 2012 Projected Revenue: Not disclosed Website: http://www.bannastrows.com

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With Health Care Reform, Workers May Trade Insurance For Raises

April 16, 2012

Would you give up your health insurance for a raise? A minority of big companies offered extra pay to workers who waived their health benefits last year. This practice, which was common decades ago, could see a resurgence once the biggest parts of President Barack Obama’s health care reform law take effect in 2014 and start to rearrange the health insurance market. Last year, 17 percent of employers with at least 500 workers gave a little extra money to those who turned down an offer of health insurance, according to a survey conducted by the human-resources advisory firm Mercer that will be published later this month. The Huffington Post obtained early access to the data. The median amount of extra pay was $1,000, which is considerably less than the $11,664 average cost an employer and worker incur for job-based health insurance this year, according to the consulting company Towers Watson. Jobs are the most common source of health insurance for working-age Americans and provide 154 million people with coverage, according to the Congressional Budget Office. But the implementation in 2014 of new benefit requirements on employers and individuals, along with the creation of health insurance “exchanges” and federal subsidies for individuals, families, and small businesses, will change how many Americans get health plans , unless the Supreme Court strikes down the law on constitutional grounds . The health care reform law includes a “pay or play” requirement that companies with at least 50 employees must either provide employees with health benefits or pay penalties as high as $3,000 per worker to offset the government’s cost of subsidizing insurance coverage. Although jobs are projected to remain the number-one source of health coverage, some workers will be affected, since the penalty is less money than the insurance coverage. In some cases, that will mean higher paychecks to make up for lost benefits . In 2006, Dallas resident Red Coine was offered that deal by Cisco Systems, where he was a network engineer working as a contractor. Coine, who is now 35, got an extra $200 a month and bought his own health insurance for $88, so he came out $112 ahead. “I never regretted giving up the company insurance, and no one ever mentioned to me or complained about not having it,” he told HuffPost via email. The connection between jobs and health insurance has been weakening over the years for reasons unrelated to Obama’s health care reform law. Rising health care costs have led more employers to drop coverage: Between 2001 and 2011, the percentage of companies offering health benefits dropped from 68 percent to 60 percent . The health care reform law created incentives that will lead some employers to maintain coverage or begin offering benefits, but cost pressures will likely cause other companies to stop providing health insurance to some or all of their workers. According to another Mercer survey , 91 percent of firms with at least 500 workers are likely to keep offering health benefits. Employees of smaller companies are more likely to lose coverage, but are already more likely to not have it in the first place, according to Mercer. Overall, 14 million fewer workers will get insurance from their jobs as a result of health care reform, and all but 2 million will find coverage elsewhere, thanks to the law’s federal subsidies and insurance market reforms, according to the Congressional Budget Office. Economists also predict companies that drop insurance for some or all of their workers will boost their compensation by raising pay or strengthening other fringe benefits. People earning between 133 percent and 400 percent of the federal poverty level — $30,657 to $92,200 for a family of four this year — would qualify for federal tax credits to defray the cost of health insurance, which could make it cheaper than the coverage available at work, said Tom Billet, a senior consultant at Towers Watson.

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Jim Kukral: The New Business Model of Book Publishing

April 16, 2012

I’ve written previously about how Amazon’s Kindle and their KDP Select program is bringing new writers to the book publishing world, bypassing traditional publishers. But sometimes, established writers are finding a new voice there too. Randy Cassingham is one of the first online publishers: his This is True column went online in 1994. It’s his full-time gig: over the years, it has brought him several million dollars in income, and he lives on 45 acres in western Colorado, where he looks at gorgeous snow-covered mountains from his home office. “TRUE” (as Cassingham calls it) is biting social commentary, using weird news as its vehicle. It’s funny and has a loyal following: thousands pay $24/year to get the full column by e-mail each week. Tens of thousands get a free sampler. It might be the first example of an online “fremium” business model. In the early years, he turned down two unsolicited syndication deals to bring the column to newspapers — turning them down because he didn’t want to give up control of his work, he says. Good move: now he’s compiling his archives into Kindle books, where he can get a 70% royalty on sales, rather than the 12.5% that Dutton (part of the Penguin Group) pays him when it turned another of his websites into a book. And it’s working: Cassingham told me that in the first two weeks of Kindle book sales, the five volumes he has posted so far earned more than $1,400 in royalties from Amazon. “I’m boggled,” he told me by e-mail. “Imagine if I actually concentrated on this income pillar. Or had more than five books available. Or I sent one or more titles out for review somewhere, or advertised, or did ANY kind of promotion to anyone other than my existing readers!” Imagine indeed! Then he realized that a throw-away human interest feature he includes in This is True, the “Honorary Unsubscribe” of someone who died in the previous week, could also be good book material. “These are the people you wish you had known,” he says. “Take the inventors I’ve featured. Did you know the same guy invented both the computer hard drive and the video cassette? What a fascinating guy!” He has also featured the inventors of the contact lens, the hovercraft, the Hawaiian shirt, even the guy who thought of putting a peanut inside an M&M. Then, he says, getting excited as he looks through his archive, “there are the medical researchers, responsible for saving thousands, even millions of lives, spectacular entertainers that died virtually forgotten, and…” Just as he says: the kind of people you wish you had known. That book just came out on Amazon’s Kindle this week, and it’s the first of several in that series. Cassingham told me that “I’m glad I have a block of 100 ISBNs” — International Standard Book Numbers, which are used to identify books for retailers, including Amazon — “I’m going to need them.” Cassingham used to have the material now coming out in his books available free in various web archives. He counted on Google’s Adsense program to bring in ad money, but it hasn’t worked as well as he had hoped, even though it’s all original work. “TRUE’s archive,” he admitted, “which had more than five volumes of material, only brought in $559 for the entirety of 2011.” Compared to more than $1400 in the first two weeks on Amazon, it’s no wonder Cassingham is starting to take the archives down. If someone follows a link to an archive page that has been removed, they now see information on what book it’s in — with a link to its Amazon sales page. ( Example ) Self-publisher J.A. Konrath laments on his blog that he wishes he had the rights to his first novels, now that he has sold more than 700,000 copies of his later efforts, self-published on Kindle. Cassingham doesn’t have that problem (not counting his one book with Penguin). His only problem now is getting his existing work converted to Kindle as fast as he can. As more established, quality authors who kept the rights to their work figure out that it’s to their advantage to publish themselves on Kindle rather than beg for contracts from “big” publishers, there will be an explosion of great work available in e-book form. It’s truly the start of a new model of mainstream book publishing. Amazon CEO Jeff Bezos said so pretty much himself in a letter to shareholders last week. Speaking about his Kindle Direct Publishing platform, he said, “The most radical and transformative of inventions are often those that empower others to unleash their creativity – to pursue their dreams. These innovative, large-scale platforms are not zero-sum — they create win-win situations and create significant value for developers, entrepreneurs, customers, authors, and readers.” What do you have to say about it? Please leave a comment.

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‘Mad Men’: Lane Tries To Prove His Worth, Challenges Pete

April 16, 2012

Lane is struggling to find where he belongs in the new firm, and so he decided he was going to assert himself on ” Mad Men ” (Sun., 10 p.m. ET on AMC). He did so by landing a potential deal with a new client. Only, Lane isn’t properly equipped to land a client. What nobody knew was that the client was basically already landed. Instead, Lane flubbed his first attempt to find common ground with the client, and then things went completely off the rails when Pete, Roger and Don took him to a brothel. There, Pete tried to assert his authority with one of the ladies, as he continues to be dissatisfied. In that, Pete has been consistent since the pilot episode. As much as he has — and Don is under the impression that Pete is living the dream — it’s never enough for Pete. He has to try and take down Roger at every turn as an old fossil, and then he tells Lane he’s useless. This affront leads Lane, who’s struggling with his own feelings of uselessness, to challenge Pete to a fight, and subsequently knock him to the ground. That’s not going to help Pete’s own insecurities and dissatisfaction. At this point, what would satisfy him? “Mad Men” continues Sundays at 10 p.m. ET on AMC. TV Replay scours the vast television landscape to find the most interesting, amusing, and, on a good day, amazing moments, and delivers them right to your browser.

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‘Celebrity Apprentice’: Lisa Lampanelli Attacks Dayana Mendoza

April 16, 2012

Lisa Lampanelli experienced a roller coaster of emotions on this week’s installment of ” The Celebrity Apprentice ” (Sun., 9 p.m. ET on NBC). During their task, she and Dayana Mendoza got into it, when Mendoza wanted more to do, and Lampanelli accused her instead of wanting to be in the spotlight. The attack left Mendoza in tears. “She still has no decency or respect,” Mendoza said. Despite Lampanelli later crying in the boardroom and saying she didn’t want to be a villain, or make girls cry, she was later much harsher toward Mendoza in a radio interview. There, she resorted to racial slurs and downright vicious and completely uncalled for insults. Mendoza told HuffPost , “If poking fun at me can help her sell tickets to her shows, no problem, I am happy to help her put food on her table. However, when she uses racial slurs, she is not only targeting myself but degrading an entire Hispanic culture.” In the end, the drama didn’t hurt either woman — or perhaps it helped them if Donald Trump wants to nurture it for better television. Instead it was Paul Teutul Sr. (” American Chopper: Senior vs. Junior “) who got the boot for just not doing enough as project manager. Catch new episodes of “The Celebrity Apprentice” every Sunday at 9 p.m. ET on NBC. TV Replay scours the vast television landscape to find the most interesting, amusing, and, on a good day, amazing moments, and delivers them right to your browser.

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Netflix CEO Blasts Comcast Over Net Neutrality

April 16, 2012

In the latest battle in the war for living room domination, Netflix’s CEO Reed Hastings took to his public Facebook account and called out Comcast’s latest attack on Net Neutrality.

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Google Co-Founder: Internet Freedom Facing Greatest Threat Ever

April 16, 2012

LONDON, April 16 (Reuters) – The principles of openness and universal access that underpinned the Internet’s creation are facing their greatest-ever threat, the co-founder of Google Sergey Brin said in an interview published by Britain’s Guardian newspaper on Monday. Brin said the threat to freedom of the Internet came from a combination of factors, including increasing efforts by governments to control access and communication by their citizens. Brin said attempts by the entertainment industry to crack down on piracy, and the rise of “restrictive” walled gardens such as Facebook and Apple, which tightly control what software can be released on their platforms, were also leading to greater restrictions on the Internet. “There are very powerful forces that have lined up against the open Internet on all sides and around the world,” Brin was quoted as saying. “I am more worried than I have been in the past. It’s scary.” He said he was concerned by efforts of countries such as China, Saudi Arabia and Iran to censor and restrict use of the Internet. Brin said the rise of Facebook and Apple, which have their own proprietary platforms and control access to their users, risked stifling innovation and balkanising the web.

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Expert: Oil & Gas Wastewater Needs Treatment

April 16, 2012

PITTSBURGH (AP) — A former top environmental official says Pennsylvania’s successful efforts to keep Marcellus Shale wastewater away from drinking water supplies should be extended to all other oil and gas drillers. “It’s the same industry. It is the same contaminants. And the goal should be the same,” said George Jugovic Jr., who was formerly the Department of Environmental Protection’s southwest regional director. He’s now president of PennFuture, an environmental group. An AP analysis of state data found that in the second half of 2011 about 1.86 million barrels — or about 78 million gallons — of drilling wastewater from conventional oil and gas wells were still being sent to treatment plants that discharge into rivers. The core issue is whether a problem in waterways has been solved, or if more needs to be done. In 2010 health experts raised alarms when they found soaring levels of ultra-salty bromides in rivers and streams that are major sources of drinking water. The general view was that wastewater from Marcellus Shale gas drilling — polluted with heavy bromides from deep underground — was contributing to the problem. High levels of bromides can contaminate drinking water with levels that exceed national safety standards and are potentially harmful. Though not considered a pollutant by themselves, the bromides combine with the chlorine used in water treatment to produce trihalomethanes, which may cause cancer if ingested over a long period of time. Bromide levels were so high in rivers during 2010 that they caused corrosion at some plants that were using the water. But since the spring of 2011 most Marcellus drillers have been recycling the fluids, or sending then to deep underground wells mostly in Ohio. The gas-rich Marcellus, which lies thousands of feet underground, has attracted a gold rush of drillers who have drilled almost 5,000 new wells in the last five years. But the state also has about 70,000 older oil and gas wells, according to DEP statistics, that target different, shallower reserves. Researchers say the bromide levels did drop last summer, but they had also expected even more of a decline after virtually all of the Marcellus Shale drillers stopped disposing wastewater into plants that discharge into rivers. But conventional oil and gas wells weren’t included in last year’s recycling push — a loophole that state environmental officials downplayed at the time. Jugovic said DEP secretary Mike Krancer should now take “the next step” and get voluntary compliance from the rest of the gas industry. “It’s hard scientifically to justify a distinction between treating conventional wastewater differently. The wastewater is being disposed in plants that are not capable of treating those contaminants,” he said. Dave Mashek, a spokesman for the Pa. Independent Oil & Gas Association, declined to comment. Kevin Sunday, a DEP spokesman, claimed that the volume of conventional oil and gas waste is “substantially smaller” than the Marcellus amounts. But the AP found that 78 million gallons of oil and gas wastewater were still being taken to treatment plants in the last half of 2011 — about 33 percent less than the Marcellus quantity that was raising concerns in 2010, but still a substantial amount. If that rate continues, the conventional wells will send about 150 million gallons of the wastewater to treatment plants that discharge into rivers this year. Sunday said the agency encourages wastewater recycling, “regardless of the industry involved,” and added that the conventional oil and gas drillers don’t produce as much wastewater as the Marcellus drillers. Sunday also said that the agency has created a new, revised permit to encourage recycling of waste. Ten facilities have applied for the new permit, and if all are approved, that would double the number of such facilities in the state. David Sternberg, a spokesman for the U.S. Environmental Protection Agency, didn’t directly answer a question about whether there was any scientific justification for treating the non-Marcellus waste differently. Sternberg said EPA, which urged Pennsylvania regulators last year to halt the dumping, is working closely with state regulators “to ensure that, where wastewater treatment facilities are accepting oil and gas wastewaters, discharges from these treatment facilities are in compliance with the Clean Water Act.” Jugovic said that some previous assumptions about the non-Marcellus waste turned out to be false. For example, there were suggestions that it generally contained much lower levels of bromides and other contaminants. He said some of the shallow wells had very high levels of total dissolved solids and other contaminants that can be a problem for drinking water supplies. Jugovic also said that the fact that 97 percent of Marcellus drillers appear to be complying with the wastewater restrictions raises a fairness issue. Why, he asked, should the conventional oil and gas drillers and the remaining 3 percent of drillers get a pass? Now, researchers are waiting for expected lower river levels in the summer, to see if the bromide problem has really gone away. The higher flows in early spring dilute any contaminants and make it harder to draw conclusions about the bromides.

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The 13 Most Bizarre Job Titles In Tech

April 15, 2012

Developments in the tech world have brought about amazing innovations and new ways of connecting that have altered the lives of many. They’re also responsible for some seriously strange job titles. We aren’t lying when we say a few of these position names would raise eyebrows among job hunters. At least one would probably be flagged as inappropriate content in the Craigslist classifieds. Flip through the following slideshow to check out some of our favorite oddly named jobs. Vote for the one you think is the weirdest, and let us know in the comments if you’ve come across a weirder one. You can also tweet your suggestions to us (@huffposttech), or email us (technology@huffingtonpost.com).

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Startup Turns Problem Solving Into Sport

April 15, 2012

SAN FRANCISCO — Strange secrets hide in numbers. For instance, an orange used car is least likely to be a lemon. This particular unexpected finding came to light courtesy of a data jockey who goes by the Internet alias SirGuessalot, who in fact wasn’t guessing at all. Instead, he and his partner, PlanetThanet, relied on the hard math skills that make them top contenders in a sport tailor-made for the 21st century: competitive number-crunching. The used car defect prediction contest is one of dozens hosted by San Francisco online startup Kaggle, whose creators believe they can tap the global geek population’s instinct for one-upmanship to mine better answers faster from the world’s ever-rising mountain of data. “Competitions bring together a wide variety of people into a wide variety of problems,” said Jeremy Howard, who became Kaggle’s president and chief scientist after winning multiple competitions himself. “You get people looking at stuff they’d never look at otherwise.” While the used car contest was fun, Kaggle has its eye on weightier scientific problems. In one contest, an English major who trained himself in data science built a model for predicting the progress of HIV infections in individual patients. In another, a scientist who studies glaciers for a living won a NASA-backed Kaggle competition to measure the shapes of galaxies by mapping the universe’s dark matter. The data problems that need solving are so important that those who find the solutions should be paid like professional athletes, said Kaggle founder Anthony Goldbloom. By turning data-mining into a crowdsourced contest, he hopes he’s created a way to make that happen. Already one of Kaggle’s contests offers a multimillion dollar prize. “We want to see the best data scientists earning more than Tiger Woods,” said Goldbloom, who started the company in his native Australia and recently came to San Francisco’s South of Market startup haven. The job market for mathematicians and statisticians has become hot as the sheer volume of data generated by ever faster, cheaper computing resources explodes. Data storage has become so inexpensive that a 2011 McKinsey and Co. report estimated that a disk drive capable of storing all the world’s music would cost about $600. Walmart stores 10 times more data on customer transactions and other parts of its operation than is contained in the entire Library of Congress, according to the same report. Analyzing the so-called “big data” deluge has become a key task for businesses in an effort to divine everything from which ads online customers will click to how much inventory they need to maintain. Political candidates analyze data to predict voting patterns. Dating websites try to predict ideal mates. Kaggle competitions focus on creating and testing formulas that can be used to make predictions based on the contents of giant datasets. The more accurate the formula, the better the chances it will accurately provide answers to complex questions, such as the orange used car being the least likely to break down. Goldbloom argues that no matter how many data scientists companies hire, relying on in-house data talent means companies can’t know if they’re getting the best solution. In a Kaggle contest, competitors find out as soon as they submit their solutions how they stack up against fellow contestants. They can keep trying for the duration of the typically three-month contests, which are highlighted on the company web site. As the first entries come in, the accuracy of competing models improves by leaps, Goldbloom said. As the contests progress, the improvement curve flattens out. Goldbloom and Howard believe that shows the competitive approach pushes data scientists toward the best solutions within human reach. “Crowdsourcing allows you to squeeze data dry,” Goldbloom said. Not all competitions are open to all comers, however. About 33,000 contestants have taken part in Kaggle’s public competitions, where prize money tends to top out at around $10,000. Winners can get invited to participate in elite private contests, which may include access to sensitive private data sets. Kaggle’s business model depends on deep-pocketed contest sponsors like banks seeking to outdo each other with more lucrative prize purses to attract the best competitors, who themselves in theory could then make their livings off Kaggle competitions alone. The biggest prize by far open to the public is $3 million offered by the California-based Heritage Provider Network medical group to the data scientist best able to use hospital admission records to predict the profiles of people most likely to end up in the hospital. The next-biggest purse is $100,000 in prizes put up by the Hewlett Foundation for algorithms that can automatically grade student essays. In its grandest vision of itself, the 11-person company backed by PayPal co-founder Max Levchin will have tens of thousands of competitions running simultaneously. Guilds of data gurus will band together to unleash software that enters competitions automatically. Kaggle becomes not just a way to push humans to perform at their best but to make machines themselves smarter as code-based contestants battle and “learn” from their mistakes. In this way, Howard said, data competitions become steps along the development of artificial intelligence systems such as self-driving cars. As for why orange used cars are most likely to be in good shape, the numbers did not hold the answer. One notion was that such a flashy color would only attract car fanatics who would be more likely to take care of their vehicles. That didn’t pan out, however, since the least well-kept used cars turned out to be purple. ___

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Rory O’Connor: Facebook Is Not Your Friend

April 15, 2012

“Imagine… that you knew which sites — or what news stories — people you trust found useful and which they disliked,” David Kirkpatrick wrote in the June 11, 2007 issue of Fortune magazine. “This isn’t fantasy. Facebook might make it possible, and soon. Yes, the social-networking site college kids spend so much time on — the one you thought was just about hooking up — could turn out to be more important than any of us thought.” Kirkpatrick, who was then Fortune ‘s Senior Editor for Internet and Technology, went on to write the best-selling The Facebook Effect: The Inside Story of the Company That is Connecting the World , the definitive book on the company. He was prescient. In a startlingly short period of time, Facebook did make it possible for you to find those trusted and useful news sites and stories — along with much, much more. Now, with Facebook facing growing scrutiny in advance of its IPO next month, which is expected to value the Internet giant at $100 billion, the question of trust looms even larger. True, the social networking giant has made it easier than ever before to find trusted friends and followers, who can now create, curate, aggregate and distribute news and information with an unprecedented ease, as I detail in my new book Friends, Followers and The Future : How Social Media are Changing Politics, Threatening Big Brands and Killing Traditional Media . But is Facebook itself, the billion dollar baby whose rapid growth has yet to be slowed by continuing controversy over the privacy of its more than 800 million users, itself worthy of our trust? Can we rely on its wunderkind CEO Mark Zuckerberg, who has repeatedly pronounced privacy to be outmoded and argued that we are living in a new era beyond it, to safeguard our interests? Despite our differing — some would say competing — concerns, should we regard Facebook and Zuckerberg as our friends? After all, the online social network, which offers its tools, technologies, and services at no cost, makes profit primarily by using heretofore private information it has collected about you to target advertising. And Zuckerberg has repeatedly made sudden, sometimes ill conceived and often poorly communicated policy changes that resulted in once-private personal information becoming instantly and publicly accessible. As a result, once-latent concerns over privacy, power and profit have bubbled up and led both domestic and international regulatory agencies to scrutinize the company more closely. In one case, consumer protection groups, including the Electronic Privacy Information Center (EPIC) and fourteen others, filed a 2009 unfair-trade complaint with the Federal Trade Commission (FTC) accusing Facebook of unfair and deceptive trade practices that “violate user expectations, diminish user privacy, and contradict Facebook’s own representations.” It said that Facebook’s decisions to disclose previously restricted “personal information to the public” had violated users’ expectations, diminished their privacy, and contradicted its own representations. It asked the FTC to order the company to “restore privacy settings that were previously available… and give users meaningful control over personal information,” to investigate Facebook’s trade practices, require the company to restore privacy settings that were previously available and force it to “give users meaningful control over personal information.” Facebook settled in November 2011 by agreeing to refrain from making any further deceptive privacy claims, to obtain consumers’ approval before changing the way it shares their data, and to undergo independent third-party auditing for 20 years. Shortly after the uproar subsided, however, renewed concerns over privacy and trust began to shake the brand again. This privacy blunder centered on Facebook’s belated admission that it was still tracking the web pages its members visited, even after they have logged out of the Facebook site. As Daniel Bates reported for the Daily Mail , The social networking giant says the huge privacy breach was simply a mistake — that software automatically downloaded to users’ computers when they logged in to Facebook ‘inadvertently’ sent information to the company, whether or not they were logged in at the time. Most would assume that Facebook stops monitoring them after they leave its site, but technology bloggers discovered this was not the case. Instead, the tracking information — worth billions of dollars to advertisers — was being sent back to the Facebook servers. Even after you were logged out, Facebook still tracked every page you visited. As Bates noted, “The admission is the latest in a series of privacy blunders from Facebook, which has a record of only correcting such matters when they are brought to light by other people.” As its executives struggled to explain the “inadvertent” privacy row over its “creepy” web-tracking practices, that trust was shaken once again “by criticism and speculation regarding how it uses browser cookies to get data about users,” as Josh Constine posted on Insidefacebook.com . A lack of thorough documentation explaining what each of its cookies does has led some observers to assume that the company is tracking offsite browsing behavior in order to target ads. Facebook needs to provide explanations for both the average user and privacy researchers about how exactly its cookies work in order to prevent these press flare-ups from giving users a negative impression and bringing on regulatory scrutiny from governments. The company’s growing stature and importance only magnifies such concerns. As Facebook profile pages morph more and more into overall online identities, the inherent tension between our individual desire to protect personal information and the company’s need for that information comes into ever-sharper focus. Last week, for example, Facebook sought once again to address the persistent criticism of its privacy practices by instituting a new policy providing greater transparency on the types of data it stores about you. Yet critics like Max Schrems, a German law student who filed a complaint leading to the agreement, still criticize the company’s response. “We welcome that Facebook users are now getting more access to their data, but Facebook is still not in line with the European Data Protection Law,” Schrems told Kevin J. O’Brien of the New York Times . “With the changes, Facebook will only offer access to 39 data categories, while it is holding at least 84 such data categories about every user.” In 2011, when Schrems requested his own data from Facebook, he learned that the company was keeping information he had previously deleted from the website, and was storing information on his location. None of that sounds too friendly to me, so I really can’t recommend that you trust Zuckerberg, or Facebook, or indeed any corporation that makes its money by selling you — down the river or anywhere else. And as Nielsen’s Latest Global Trust in Advertising Survey proves, we trust “word-of-mouth recommendation from friends and family” above all other forms of communication. (At least that’s what 92 percent of respondents in 56 different countries said .) At the same time, our trust in paid traditional media (including television, magazine and newspaper ads) has steadily declined since 2009. (Trust in television is down 24 percent; magazines, down 20 percent; and newspapers down 25 percent, according to the survey.) “Consumers around the world continue to see recommendations from friends… as by far the most credible,” said Randall Beard, global head, Advertiser Solutions at Nielsen. Trust is essential for the success of any brand. Mark Zuckerberg may think that Facebook’s recurrent privacy flaps haven’t much affected the sometimes anti-social social network, but they represent a huge potential threat to what he has built. The high-handed manner in which members’ personal information has been treated, the lack of consultation or even communication with them beforehand, Facebook’s growing domination of the entire social networking sphere, Zuckerberg’s constant and very public declarations of the death of privacy and his seeming imposition of new social norms all feed growing fears that he and Facebook itself simply can not be trusted. As Zuckerberg’s fellow CEOs from the legacy media should have already learned, losing the trust of your audience is the first step in losing your audience itself — and eventually the power of your brand.

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‘I’m Always The One Drinking Diet Coke At Happy Hour’

April 15, 2012

NAIEL IQBAL’S co-workers couldn’t figure him out. Ms. Jukaku, a former analyst at Goldman Sachs, prayed in her Manhattan apartment. He’d just started at a Midtown Manhattan hedge fund — the kind of elite enclave where overachievers in button-downs go to make a few hundred grand before heading off to Harvard Business School. But Mr. Iqbal, 27, a graduate of the Wharton School, wasn’t acting like a typical finance guy. He didn’t introduce himself around the office. Nor did he grab lunch with the other traders.

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Geithner: ‘No Credible Basis’ For Argument That Buffett Rule Will Hurt Economy

April 15, 2012

WASHINGTON, April 15 (Reuters) – A proposal to impose at least 30 percent income tax on Americans making more than a million dollars a year will not hurt the economy by stifling investment and growth, U.S. Treasury Secretary Timothy Geithner said on Sunday. “No credible basis for that argument, in my judgment,” Geithner said on CBC’s “Face the Nation.” “I don’t think there is a plausible path to tax reform … that doesn’t recognize the reality that we cannot afford to extend these tax cuts for the most fortunate Americans,” he said.

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Simon Johnson: Jim Yong Kim for the World Bank

April 15, 2012

A decision on choosing the next president of the World Bank is expected this week — perhaps as early as Monday. The Obama administration nominated Jim Yong Kim, president of Dartmouth College and a noted public health expert. The reaction to this nomination from development economists and people experienced in the business of lending to poor countries has been overwhelmingly negative. They are making a big mistake. Mr. Kim would make an excellent World Bank president. There are three issues. First, should the president of the World Bank continue to be an American? Second, should this position be held by someone with a primary background in economics and finance? Third, should this job go to a person — like Mr. Kim — who has specialized on public health? The job of running the World Bank should not necessarily go to an American — just as the job of managing director at the International Monetary Fund should not be presumed to go to a European. The divvying up of these important positions is a de facto arrangement that became established in the 1940s and 1950s, but it has really outlived its appropriateness. There should be an open competition for both positions — and Mr. Kim faces appropriately strong competition from Ngozi Okonjo-Iweala, a well-respected Nigerian finance minister and former senior official at the World Bank. There is no question that the White House wants this job to go to an American, mostly because no administration likes to be the one to give up such prerogatives. And gone are the days when anyone put up by the United States would necessarily be chosen — even the controversial Paul Wolfowitz went through with surprisingly little push back, although he ran into trouble subsequently. But Mr. Kim is a brilliant nomination, precisely because he is so far from the mold of standard World Bank presidents. For a full write-up of his accomplishments, see this piece by Anjali Sastry and Rebecca Weintraub. (Sastry is one of my colleagues at MIT, where she teaches a very successful course that integrates global health and management issues, follow her @anj_sas; Weintraub is a physician and prominent public health specialist.) The World Bank does not need “more of the same” in terms of vision from its leadership. Like it or not, the World Bank will continue to issue bonds and make loans to countries for infrastructure and other projects, typically at an interest rate that is somewhat below what is being charged by the private sector. It will also try to raise donor funds that can be shared with very poor countries, preferably in a productive manner. The World Bank will also continue to struggle having a profound impact on people’s lives with these standard development lending activities. To understand this point, look at two books. Bill Easterly’s The Elusive Quest for Growth is a brilliant account of what has gone wrong — repeatedly — with thinking about development, including but not limited to the World Bank. Daron Acemoglu and Jim Robinson’s new bestseller, Why Nations Fail , provides all you need to know — and probably more than you can stomach — about why some countries stay so poor. The very sad truth is that powerful people in some places do very well, in their own estimation, when the rest of the country remains in ruins. And there is nothing the World Bank — or anyone else in development economics — can do to break through and share prosperity more broadly in those places. (You can follow Easterly and Acmeoglu/Robinson on twitter: @bill_easterly and @WhyNationsFail; the conversation around @WhyNationsFail is particularly lively and informative at present.) But public health is different. In contrast to the lack luster performance of development economics over the past half century, public health intellectuals and officials have completely transformed health outcomes around the world. This process started early in the 20th century but really picked up pace in the 1940s and 1950s (for more historical background and medical details, see “Disease and Development,” a 2007 paper co-authored with Daron Acemoglu.) The very poorest people in the world did not participate fully in this global health transformation — partly because of the problems outlined in Why Nations Fail. But leaders like Mr. Kim — and in fact Mr. Kim himself — are leading a second breakthrough, in which better health services are being delivered even to very poor people in some of the most difficult conditions imaginable. There is a great deal more to be done. The World Bank does good work supporting public health initiatives, but it could do much more. If Mr. Kim becomes World Bank president — and preferably stays in that position for a decade — we should expect to see a great deal more progress. The task now is to mobilize private donors, pharmaceutical companies, and officials in a robust coalition focusing on improving health and increasing life expectancy. The mortality of children under the age of five is likely to be a top priority in that context. Reducing maternal mortality should also get a great deal of attention. All of this is completely achievable. Public health has done well in the past half century. We should provide more resources and encourage greater success. Save and improve millions of lives. Mr. Kim is exactly the right person to lead the next transformation of global health outcomes. Simon Johnson is the co-author of White House Burning: The Founding Fathers, Our National Debt, and Why It Matters To You , available now. This post is cross-posted from The Baseline Scenario .

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More Trouble For Twinkies Maker

April 15, 2012

DALLAS — The company that makes Twinkies, Wonder bread and Ding Dongs says it’s making a final offer to workers to accept cost-cutting before it asks a bankruptcy court to impose the cuts. Hostess Brands Inc. wants the Teamsters and bakers’ unions to accept reduced pension benefits and changes in work rules to lower costs. It wants to outsource some delivery work. The company said Saturday that if the unions reject the offer, it will push ahead with efforts in bankruptcy court to throw out the unions’ collective bargaining agreements. A union official warned that could lead to a strike. Hostess Brands filed for Chapter 11 protection in January, its second trip through bankruptcy court in less than a decade. A trial to decide the fate of the union contracts is scheduled to start Tuesday. Hostess wants to withdraw from some multi-employer pension plans, although it opened the door Saturday to possibly rejoining a few of the financially strongest plans. New hires would be covered by the same 401(k)-type retirement accounts used by nonunion and management employees. The company’s new CEO, Gregory F. Rayburn, said Hostess wants to cut annual pension contributions from $103 million to $25 million. Hostess also wants to change work rules that sometimes require two trucks instead of one, and to outsource deliveries to small stores. Ken Hall, general secretary-treasurer of the Teamsters, said the union would reject the company’s proposal and make a counteroffer Sunday. He said Hostess had provided only the barest details of how the new pensions program would work, and that employees already accepted big concessions in 2008. Workers represented by the Teamsters and the bakery and confectionary workers’ unions voted in February to authorize a strike, and Hall vowed Saturday that workers would walk off the job if the bankruptcy judge agrees to the company’s cuts. Rayburn said that if workers strike, the company will be forced to shut down and liquidate. Hostess makes sugary confections familiar to generations of Americans and it bakes Wonder bread, a leading white bread. Consumers increasingly have been buying other snacks, such as yogurt, and more wheat bread. White bread’s popularity has plunged – in 2000, it was eaten in 54 percent of all U.S. homes compared to 36 percent last year, according to consumer-marketing research firm NPD Group. Rayburn blamed Hostess’ problems on high pension and labor costs that led to insufficient investment in the company and new products. Rayburn said he doesn’t buy the healthy-diet explanation. “If that were the case and that was sort of the downfall, there wouldn’t be any chocolate companies out there either,” he said. “There’s a market for Twinkies and Ho Hos and Ding Dongs.” As part of its turnaround plan, Hostess wants to raise at least $400 million from current lenders or new investors or by selling brands. Rayburn said he has talked with a potential buyer of one of its small, regional brands. Before the company filed for bankruptcy protection, eight top executives got pay raises last year of up to 80 percent. This month, some agreed to take $1 a year until the company comes out of bankruptcy or Dec. 31, whichever comes first, while others gave up their pay raises.

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Dueling Tax Plans Spell Long Fight Ahead

April 15, 2012

WASHINGTON — Democrats and Republicans are forcing votes in Congress this coming week on competing tax plans that affect millionaires and smaller businesses, and they know the proposals are doomed from the start. But that doesn’t matter to either party. Their bills are more about pontificating than legislating, aimed at voters in November’s congressional and presidential elections. Neutral economists say neither bill would do much for the economy or job creation. Some political professionals are equally unimpressed with their potential impact on voters. Undaunted, congressional leaders hope to maximize public attention by timing both roll calls with an eye to Tuesday, the annual deadline for filing income taxes with the Internal Revenue Service. The upcoming votes probably are just a start. Senate Democrats later this year may hold votes tied to President Barack Obama’s “Buffett rule,” using his idea of a minimum 30 percent tax on the wealthiest to raise money for proposal to create jobs and keep student loan rates from rising. With trillions in tax cuts dating from President George W. Bush set to expire in January, House and Senate leaders also are considering campaign-season votes on extending popular parts of those reductions, such as preventing the $1,000 child tax credit from being cut in half. In addition, Obama and his all-but-certain GOP opponent, Mitt Romney, will spend much of the campaign promoting their tax blueprints as antidotes to an economy still struggling to generate jobs. Besides raising taxes on the wealthy, Obama would boost levies on many U.S. companies that do business overseas, and on the oil and gas industry. The new money would help lower individual and corporate rates and reduce federal deficits. Romney would continue all Bush tax cuts, including those for the richest people, while trimming rates and eliminating estate taxes. “If this were a heavyweight fight, we’re still in the first round where both sides are kind of feeling each other out,” Republican consultant Mike McKenna said about the votes in the week ahead. On Monday, as Congress returns from a two-week spring break, the Democratic-led Senate expect votes on a “Buffett rule” measure by Sen. Sheldon Whitehouse, D-R.I. It would slap a minimum 30 percent income tax on people making over $2 million yearly and phase in higher taxes for those earning at least $1 million. Republicans are sure to block the bill, nicknamed for billionaire Warren Buffett, who backs higher taxes on the rich. The GOP-run House plans a Thursday vote on legislation providing a 20 percent tax deduction for businesses that employ fewer than 500 workers, which covers 99.9 percent of all companies. The proposal, sponsored by House Majority Leader Eric Cantor, R-Va., seems certain to pass, but fail in the Senate. Those votes are set just as many Americans stare at their own tax returns. The Internal Revenue Service says that through April 6, it had received 99 million of 145 million expected returns. So far, 80 million refunds have been issued averaging $2,794, down $101 from last year. For political leaders looking ahead to the November elections, the demise of this week’s bills will matter little. Democrats think the Buffett rule vote will underscore their commitment to economic fairness and GOP favoritism for the rich, a prominent election theme. Hammering at it lets Obama shine a spotlight on Romney, a former private equity executive who has paid an income tax rate of about 15 percent on annual earnings of $21 million, which is a lower rate than many middle-class families pay. “In America, prosperity has never just trickled down from a wealthy few,” Obama said Wednesday during a week packed with events promoting his plan. “Prosperity has always been built from the bottom up and from the heart of the middle class outward. And so it’s time for Congress to stand up for the middle class and make our tax system fairer.” Republicans believe the business tax measure will spotlight their efforts to lower taxes and create jobs, contrasted with Democrats’ preference for higher taxes to finance ever-larger government. They believe they win the debate by keeping the focus on those subjects, not what the wealthy pay. “We want small-business people to have more money go to their pockets, not the government’s,” Cantor said recently at a Virginia high school. “And then they have more money to make decisions about hiring, about retaining jobs and about creating more jobs.” Democratic political consultant Alan Secrest said both measures might excite the most fervent partisans but do little for independents, who he said care more about jobs. “And neither party has a particular advantage on that right now,” Secrest said. The Buffett rule is clearly popular. An Associated Press-GfK poll in February showed that nearly 2 in 3 favor a 30 percent tax for those making $1 million annually, including most Democrats and independents and even 4 in 10 Republicans. Yet the measure would raise just $47 billion over a decade, a smidgen of the $7 trillion in federal deficits expected during that time. While a 20 percent tax deduction would be welcomed by any company, the $46 billion in lower taxes Cantor’s bill would provide over the next six years would barely register on the $100 trillion in U.S. economic activity projected for that period. There also are doubts that it would spur new jobs. “If they have more sales, they’ll hire,” said Maury Harris, chief U.S. economist for UBS, the investment bank. “If they don’t have the sales, they won’t hire. That’s what it’s all about.” Senate Democrats, who champion a narrower bill providing tax credits for firms hiring workers, call the GOP small-business cuts “a profit-padding tax giveaway.” Democrats have also criticized extending Bush’s tax cuts for being too costly at a time of big budget deficits, though most favor extending them for all but the highest earners. Rep. Dave Camp, chairman of the House Ways and Means Committee, said the business tax cut bill would show that Republicans are trying to spark job growth. He also said he would welcome Democratic opposition to any votes this year, should they occur, on renewing Bush’s tax cuts. “If the Democrats want to have all those taxes go up, let them,” said Camp, R-Mich.

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FCC Wants To Fine Google $25,000

April 15, 2012

In its investigation of whether Google’s Street View cars illegally collected personal data from WiFi networks, the Federal Communications Commission has reached a decision that seems like a mix of good news and bad news for the search giant.

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Social Security Checks No Longer In The Mail

April 15, 2012

WASHINGTON — Starting next year, the check will no longer be in the mail for millions of people who receive Social Security and other government benefits. The federal government, which issues 73 million payments a month, is phasing out paper checks for all benefit programs, requiring people to get payments electronically, either through direct deposit or a debit card for those without a bank account. The changes will affect people who get Social Security, veterans’ benefits, railroad pensions and federal disability payments. Tax refunds are exempt, but the Internal Revenue Service encourages taxpayers to get refunds electronically by processing those refunds faster than paper checks. About 90 percent of people who receive federal benefits already get their payments electronically, the Treasury Department says. New beneficiaries were required to get payments electronically starting last year, and with a few exceptions, the rest will have to make the switch by March 2013. “It’s just that natural progression of moving to how people are used to receiving their funds,” said Walt Henderson, director of the Treasury Department’s electronic funds transfer division. Henderson said electronic payments are safer and more efficient than paper checks; in 2010, more than 540,000 federal benefit checks were reported lost or stolen. The switch will save the government about $120 million a year. Social Security will save $1 billion over the next decade, according to the Treasury Department. “You think of that paper check floating out there in the delivery system, with personal information on it, it’s much more susceptible to fraud versus an electronic payment,” Henderson said. Advocates for seniors say they understand the government’s desire to cut costs and take advantage of technologies that most workers already use. The food stamp program switched from paper coupons to debit cards in 2004. But they have raised concerns about requiring the switch for older retirees who may not be used to electronic payments. “This will affect some very frail elderly people who are living by themselves, many of them, and doing well, but usually within the context of that old paper check that they deposit in the bank,” said Web Phillips, a senior policy advisor for the National Committee to Protect Social Security and Medicare. “The change has to be handled carefully and with a lot of sensitivity so that there aren’t people who lose track of a payment or don’t understand that they have a card that came in the mail that’s the source of their payment,” Phillips said. “That’s our concern.” “Treasury acknowledges they have a lot of education to do for people about how these things work,” said David Certner, legislative policy director for AARP. “We’re a bit concerned about how easy it’s going to be to provide education, particularly for some in this older population who are not familiar with debit cards and don’t have bank accounts.” Certner said AARP wants the government to make it easier to get an exemption. Under the Treasury rule, current beneficiaries who are 90 and older won’t be required to make the switch. People can get a waiver if using a debit card would impose a hardship, but the Treasury Department says those would be “extreme, rare circumstances.” These waivers are not well publicized on the government’s website. “There are several million people who receive paper checks today,” Certner said. “Some of them do it because they have worked out arrangements for them that work.” AARP also has concerns about fees associated with the debit cards. The Direct Express cards are issued by Comerica Bank, Treasury’s financial agent. Each month, benefit payments are added to the cards, which can be used to make purchases or withdraw cash from ATMs. There are no fees for using the debit card to make purchases. They can be used at any retailer that accepts MasterCard debit cards. If a card is lost or stolen, the beneficiary is protected from unauthorized use as long as the missing card is reported promptly. Cardholders can make one free ATM withdrawal each time a payment is registered in the card. Subsequent withdrawals will cost 90 cents each, and all withdrawals may be subject to fees by the owner of the ATM. The government’s switch to electronic payments also comes with a side effect: less business for the U.S. Postal Service, an agency that is already facing big budget problems with the rise of email and electronic bill paying. The private sector has been migrating to electronic payments for years, costing the Postal Service millions of customers, said Alan Robinson, editor of the Postal Journal, a trade publication. “Normally, these things happen one customer at a time,” Robinson said. “In terms of payments, this is probably one of the largest.”

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Eliot Spitzer: Obama ‘Has Been On Wall Street’s Side Since Day One’

April 14, 2012

When it comes to reforming Wall Street, President Obama is all talk, according to Eliot Spitzer. The former New York governor took to Reuters TV’s Fast Forward with Chrystia Freeland to slam the president for what he says is a talk-tough, act-weak approach to the financial industry, which less than five years ago brought the global economy to the brink of disaster. “I’m not persuaded that this President has really been a voice for reform when it comes to Wall Street,” he said. “Wall Street has pretended that it has taken its hits, but it really hasn’t.” Spitzer summarized Obama’s efforts as the “occasional speech” criticizing Wall Street practices, largely followed by little to no substantial legislative action. “When it has come to actually putting in place the reform-based structure that would actually have changed the way the banking system works, he has really been on Wall Street’s side since day one,” Spitzer said. Spitzer criticized the Obama administration for what he perceives as opposition to the Volcker Rule, a key piece of financial reform that aimed to curb banks’ high-risk bets with their own money. Such trading has been criticized for pitting banks against their own clients. The president first introduced the rule more than two years ago, calling it a “simple and common-sense reform” at the time. Spitzer also claims the White House did not fight to give judges the ability to reform mortgages in the wake of the housing collapse. “The White House and Treasury intervened to defeat that in the Senate, something that could have fundamentally altered the course of our mortgage crisis that still continues to this day,” he said.

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