Obama, Republicans Still Wrangling Over Debt Solution

U.S. President Barack Obama on Saturday urged Congress to enter into what he called "shared compromise " in an effort to solve the country's debt and deficit problems.
In his weekly address, Mr. Obama said he is willing to do whatever it takes to solve the problem, even if it is not politically popular.  But he also noted the wealthiest Americans must "pay their fair share."

^{Watch President Obama's weekly address:}

A White House official said President Obama, Vice President Joe Biden, and other administration officials were discussing "various options" with congressional leaders from both parties.  However, no new talks were scheduled for Sunday.

With an August 2 deadline approaching to raise the $14.3 trillion debt ceiling or allow the United States to default,  the two sides appear far from an agreement.

Mr. Obama said earlier he would consider cuts in popular entitlements including pensions, health care for the elderly, and aid to veterans.  In return, the president has called for higher taxes on wealthy Americans and large corporations.  Republicans rejected the move saying it would hurt the economic recovery.
In the weekly Republican address, Senator Orrin Hatch of Utah blamed Democrats for the financial mess and said the president and his Democratic allies in Congress need to come up with a serious plan to control runaway spending.  Hatch said that cutting spending, limiting expenditures and requiring balanced budgets is the only long-term solution to the problem.

^{Watch the Republican weekly address:}

Speaker of the House of Representatives, Republican John Boehner, said Friday the House will vote next week on a $2.4 trillion measure to raise the debt ceiling through 2012 if Congress passes a Balanced Budget Amendment to the Constitution. 

President Obama said getting such major cuts without increasing revenue would cause unacceptably deep cuts in programs that are vital to many Americans. He also said elected officials do not need a constitutional amendment to make the tough spending decisions that are a key part of their jobs.

Meanwhile, credit rating agencies have warned that the U.S. government's credit rating would be downgraded if an agreement is not reached soon.

White House and Congressional Leaders: No Default on US Debt

The White House and congressional leaders remain adamant the United States will not default on its $14.3 trillion national debt, less than three weeks before a deadline for raising the federal borrowing limit.  But a bipartisan deal to put the nation on a sustainable fiscal path shows no sign of materializing.

On one point top Democrats and Republicans agree: failing to raise America’s debt ceiling in time to avert a default on federal obligations is unthinkable.  Jacob Lew is President Barack Obama’s top budget official. "All the leaders of Congress and the president have acknowledged that we must raise the debt limit, and the question is how," he said.

Lew spoke on ABC’s This Week television program.

The Senate’s number-two Republican, Jon Kyl, had a similar message. “The country will not default.  Whether or not there are savings achieved in the process remains open to question," he said.

Weeks of negotiations have failed to yield a so-called “grand bargain” to trim U.S. budget deficits by $4 trillion over 10 years.  The impasse has prompted several fallback plans to raise the debt ceiling if the $4 trillion target is not met.

Senate leaders are negotiating a plan that would allow President Obama to extend the federal borrowing limit even if majority votes in Congress do not materialize authorizing such a move.  In the Republican-controlled House of Representatives, a vote is expected later this week that would tie a debt ceiling increase to a more-modest deficit reduction target, as well as a constitutional amendment requiring a balanced budget.

Neither plan of last resort is seen as solving America’s fiscal woes.  Appearing on CBS’ Face The Nation program, Republican Senator Tom Coburn of Oklahoma criticized any attempt to shield Congress from painful votes to raise the borrowing limit. “It takes the pressure off all the politicians.  It allows us to pass a debt limit [increase] without making the hard choices that this country has to make," he said.

Another Republican, Senator Marco Rubio of Florida, blasted any scaling back of deficit reduction goals. “The real problem here is not the debt limit.  The real problem here is the debt.  If all we do is raise the debt limit, and it is not accompanied by a credible solution to America’s debt problem, we are in big trouble," he said.

August 2 is the deadline for raising the federal government’s borrowing limit.  Beyond that date, treasury officials say the U.S. government risks default.

Some Republican lawmakers have questioned this assertion, saying the United States could service the national debt and fulfill core obligations using tax revenue alone.  Democrats and the White House dispute the claim, saying the government would have to choose between interest payments on the debt, funding programs that provide income and health care for retirees, and funding the U.S. military.

Office of Management and Budget Director Jacob Lew says there is still time strike a deal and avert financial ruin.  But he adds that time is running out. “It is kind of unfortunate that things always have to get to the last minute.  Sometimes there are no consequences.  Right now, we are in a place where the world is watching, and we should get our business done," he said.

Credit ratings agencies have warned of a possible downgrading of U.S. debt, which would make U.S. Treasury bonds less attractive to investors and creditor nations and require higher interest rates to attract purchasers.  Economists warn that higher interest rates would cripple America’s shaky economic recovery.

World Bank Chief Calls Open Trade Best Economic Stimulant

World Bank President Robert Zoellick is urging the United States to take the lead in pushing the moribund Doha-round free-trade talks forward. He said open trade is the best way to help the struggling global economy. Zoellick delivered his blunt assessment at a World Trade Organization meeting in Geneva on Monday.

Zoellick said practically everybody in the world is in dire economic straits. He noted Europe is struggling with the eurozone. The United States is bogged down with debt and deficits, and is in desperate need of a growth strategy. He said Japan is coming out of a nuclear disaster and is struggling with low growth.

“So, it seems to me that in addition to the work on sovereign debt and deficits, the world needs a global growth strategy," said Zoellick.  "And, opening trade drives growth. It is the best driver of structural forms that the world has seen. We have seen it with proven effectiveness all throughout the past 60 or 70 years. So, why not revive Doha?”

That is a question more easily asked than answered. Zoellick has invested a lot of his time and his capital as a trade negotiator in Doha. He helped launch the Doha Round of free-trade talks in 2001, and remains deeply disappointed that 10 years later an agreement remains elusive.

Agriculture continues to be the main stumbling block to a deal. The developing countries are demanding the United States and European Union cut their farm subsidies. But the United States and European Union are calling on developing countries and emerging economies, such as India and Brazil, to open their markets to industrial goods and to grant greater access to services.

Since these conflicting demands appear unsolvable, Doha negotiators are discussing a potential smaller package of trade concessions, but no consensus has been reached on what is to be included in that package.

Zoellick is no fan of this “mini-deal,” which he said will be as hard to achieve as the big deal. He called it the dumbing down of the Doha round.

"So, I urge a turnaround. Now, I certainly understand that this requires leadership and it has to come from the major developed countries, as well as the emerging market countries," he said. "That is a different world than it was 15 or 20 years ago. And, obviously, the U.S., as the world’s largest economy, is a good candidate. Why not? The U.S. is going to be cutting agricultural subsidies as part of its budget deal.  There was just an agreement in the U.S. Congress to cut not only the ethanol tariff, but the ethanol subsidy.”

Zoellick called this a serious moment. He warned that the failure of the major trading nations to talk about lowering global trade barriers is putting economic growth at risk, particularly for the poorest countries.

He said it would be a huge mistake for countries to allow the Doha round to die. He also said that at a time when the world desperately needs a pro-growth strategy - closing down, rather than opening up markets - would be the worst possible thing to do.

IMF Urges Swift Action on US Debt Dispute

President Barack Obama haggle over plans to cut Washington's massive debt, the International Monetary Fund says the United States must take urgent and effective action on the issue.

Monday, the newest IMF report on the U.S. economy said it is critical to the U.S. and other economies for Washington to promptly raise the legal limit on debt, while gradually cutting spending.

Leaders of the U.S. Senate and House of Representatives are working on competing plans to raise the federal debt limit and trim budget deficits. Congress and the White House failed to reach a bipartisan agreement Sunday, prompting declines on many stock markets Monday.   Gold prices also hit a record high.

The leader of the majority party in the House, John Boehner, called on his fellow Republicans to support a short-term extension of the debt ceiling accompanied by a package of spending cuts.  Boehner earlier said he was not sure a bipartisan deal could be reached.

Senate Majority Leader Harry Reid, a Democrat, wants a longer-term deal on the debt ceiling, while also cutting trillions of dollars in spending. President Barack Obama has said he wants an ambitious debt-reduction package.

August 2 is the deadline for raising the debt ceiling and allowing the federal government to continue to borrow money.  The Obama administration and congressional leaders had hoped to announce a framework for an agreement before Asian financial markets opened Monday.

How We Broke the Murdoch Scandal

Guardian editor Alan Rusbridger on his dogged reporter, a U.S. ally—and a gamble that finally paid off.

(Page 1 of 4)

Dan Chung / Eyevine-Redux (portrait)

Alan Rusbridger, editor of The Guardian. Inset: Cover of The Guardian after the scandal.

Every so often—perhaps once every 18 months—the veteran Guardian writer Nick Davies comes into my office, shuts the door with a conspiratorial backward glance, and proceeds to tell me something hair-raising.

In June last year he wanted to inform me about Julian Assange. He’d read that the (then little-known) snowy-haired hacker was on the run with a data stick full of millions of secret documents that the U.S. Defense and State departments had carelessly hemorrhaged. His plan was to track him down … and then The Guardian would publish them all. Good idea?

Early in 2009 there had been a similar moment. He’d discovered that James Murdoch, the son and heir of the most powerful private news-media company on earth, had done a secret deal to pay more than $1 million to cover up evidence of criminal behavior within the company. Interested?

The answer to both questions was—of course. Followed by a small inner gulp at the sheer scale and implications of the stories. Followed by the sight of Nick, invariably dressed in jeans and a defiantly unfashionable brown leather jacket, disappearing back out through the door in search of trouble.

Everyone knows how WikiLeaks ended: a global swarm of revelations and headlines, with governments the world over transfixed by the daily drip-feed of disclosures, war logs, classified cables, and diplomatic indiscretions. And now everyone knows how the Murdoch story ended: with a kind of giant heave of revulsion at what his employees had been up to, and with a multibillion-dollar merger stopped in its tracks by the most overwhelming parliamentary vote anyone can remember. A profitable newspaper selling millions of copies a week had been killed off. The British press regulator was dead in the water.

Except the Murdoch story isn’t finished. It reaches so deeply into so many aspects of British and American civic life—including policing, politics, media, and regulation—that the story will continue to play out over the months, even years, ahead. Everyone expects more arrests. There are numerous civil actions wending their way through the British courts. There will be two public inquiries—into the behavior of press and police. And who knows what trouble the News Corp. shareholders or American regulatory authorities might create the more they learn about the management of the British wing of the family business.

Rewind to July 2009 and think how different it could have been. Up to this point the official narrative was straightforward. News of the World’s royal correspondent, Clive Goodman, had been caught “hacking” the palace phones. Or, rather, he had subcontracted the job to a private investigator, Glenn Mulcaire, who was expert at accessing voice messages and cracking any security (such as PIN numbers) that a victim might have put in place. The police had pounced. The two men went to jail, and News International told everyone—press, Parliament, police, and regulator—that Goodman was a lone rotten apple. The editor, Andy Coulson, resigned, protesting that he knew nothing about any of it. Game over.

How We Broke the Murdoch Scandal

Guardian editor Alan Rusbridger on his dogged reporter, a U.S. ally—and a gamble that finally paid off.

(Page 1 of 4)

Dan Chung / Eyevine-Redux (portrait)

Alan Rusbridger, editor of The Guardian. Inset: Cover of The Guardian after the scandal.

Every so often—perhaps once every 18 months—the veteran Guardian writer Nick Davies comes into my office, shuts the door with a conspiratorial backward glance, and proceeds to tell me something hair-raising.

In June last year he wanted to inform me about Julian Assange. He’d read that the (then little-known) snowy-haired hacker was on the run with a data stick full of millions of secret documents that the U.S. Defense and State departments had carelessly hemorrhaged. His plan was to track him down … and then The Guardian would publish them all. Good idea?

Early in 2009 there had been a similar moment. He’d discovered that James Murdoch, the son and heir of the most powerful private news-media company on earth, had done a secret deal to pay more than $1 million to cover up evidence of criminal behavior within the company. Interested?

The answer to both questions was—of course. Followed by a small inner gulp at the sheer scale and implications of the stories. Followed by the sight of Nick, invariably dressed in jeans and a defiantly unfashionable brown leather jacket, disappearing back out through the door in search of trouble.

Everyone knows how WikiLeaks ended: a global swarm of revelations and headlines, with governments the world over transfixed by the daily drip-feed of disclosures, war logs, classified cables, and diplomatic indiscretions. And now everyone knows how the Murdoch story ended: with a kind of giant heave of revulsion at what his employees had been up to, and with a multibillion-dollar merger stopped in its tracks by the most overwhelming parliamentary vote anyone can remember. A profitable newspaper selling millions of copies a week had been killed off. The British press regulator was dead in the water.

Except the Murdoch story isn’t finished. It reaches so deeply into so many aspects of British and American civic life—including policing, politics, media, and regulation—that the story will continue to play out over the months, even years, ahead. Everyone expects more arrests. There are numerous civil actions wending their way through the British courts. There will be two public inquiries—into the behavior of press and police. And who knows what trouble the News Corp. shareholders or American regulatory authorities might create the more they learn about the management of the British wing of the family business.

Rewind to July 2009 and think how different it could have been. Up to this point the official narrative was straightforward. News of the World’s royal correspondent, Clive Goodman, had been caught “hacking” the palace phones. Or, rather, he had subcontracted the job to a private investigator, Glenn Mulcaire, who was expert at accessing voice messages and cracking any security (such as PIN numbers) that a victim might have put in place. The police had pounced. The two men went to jail, and News International told everyone—press, Parliament, police, and regulator—that Goodman was a lone rotten apple. The editor, Andy Coulson, resigned, protesting that he knew nothing about any of it. Game over.

Twin terror attacks shock Norway

Hours after a massive bomb struck the heart of Oslo, reports began emerging of fresh horror: the indiscriminate shooting of young people attending a youth camp of the ruling Labour Party on an island west of the capital.

A gunman wearing police uniform opened fire on campers on the tiny island of Utoeya, sowing panic among them, before finally being arrested.
TV aerial images showed police commandos arriving in boats as survivors tried to swim to shore.
Others tried to hide in undergrowth, appealing for help through text messages (SMS) from mobile phones, because they feared that calls would give them away.

Continue reading the main story

“Start Quote

There is gunfire, I am hiding”

End Quote Text message received by a father from his daughter on the island

Anita Bakaas, mother of a teenage girl who survived the island ordeal unharmed, told BBC World TV that some 600 people had been camping in tents in woods.

Her daughter, she said, had hidden in a toilet with four other girls for an hour, keeping in contact by text message.
The girl told her mother the shooting had begun after campers were called to a meeting to hear about the bombing in Oslo, which had occurred several hours earlier.
As she hid, people outside the toilet door were being shot and killed, her mother said.

'Complete panic'

A witness quoted by Norwegian broadcaster NRK said a man in police uniform had called over young people, telling them "Come here", before shooting them.
The father of a girl attending the summer camp said he had received an SMS that said: "There is gunfire, I am hiding."
"We communicated by SMS," he added. "She told me not to call so as not to give away her hiding place."

Click to play

Anders Frydenberg, Oslo police, on island attack: "The police are doing everything they can"

Ali Esbati, a Swedish politician of Iranian descent who was at the camp, said in messages through his Twitter account that he had tried to help two children traumatised by the shooting.
Unhurt himself, he said he had been tens of metres from the gunman.
Adrian Pracon, an official who attended the event, told Norway's Varden newspaper of "complete panic" among the campers. He personally had seen four dead bodies.
Andre Skeie, 26, told Reuters news agency by telephone that he had seen 20 dead bodies in the water after arriving on his boat to help evacuate people.
Several witnesses told Norwegian media the gunman was of northern European appearance.

Twin terror attacks shock Norway

Eyewitness Ingunn Anderson says she saw many injured people

Continue reading the main story

Norway Attacks

• Oslo bomb
• World reaction
• Oslo eyewitnesses
• Utoeya eyewitnesses

Norway has been hit by twin attacks - a massive bomb blast in the capital and a shooting attack on young people at a governing Labour Party youth camp.

At least seven people were killed in the bombing, which inflicted huge damage on government buildings in Oslo.
At least 10 more died at the camp, on an island outside Oslo, police say. One witness said he had seen 20 bodies.
The suspected gunman was arrested at the camp and the government have confirmed that he is Norwegian.
Police have said that he is also linked with the bomb attack. Reports described him as tall and blond.

Continue reading the main story

Analysis

Gordon Corera Security correspondent, BBC News

---

The prime minister and justice minister have declined to speculate on a motive behind the attack but police are saying that they believe the car bomb and the shooting are linked and that they have a suspect in custody from Utoeya.
The ministers are confirming he is Norwegian. During the day, after an initial focus on an al-Qaeda link, the possibility of domestic extremism increasingly came into focus.
The choice of targets - government buildings and a political youth rally - suggested a possible political agenda rather than the mass casualty approach typically employed by al-Qaeda.
Constructing a large car bomb requires a degree of sophistication and the crucial factor for the police will be establishing how many people are behind this attack, whether any are still at large and to whom they might be connected.

Prime Minister Jens Stoltenberg, whose Oslo offices were among those damaged by the bomb, described the attacks as "bloody and cowardly" in a news conference.

He said that Norway had been "shaken by evil" but that Norwegian democracy and ideals would not be destroyed.
"We are a small nation and a proud nation. No-one will bomb us to silence no-one will shoot us to silence," he said.
Norwegian media reports said the shootings at the island, on the Tyrifjorden lake, were carried out by a man in police uniform.
Several people from the island camp are still missing, government officials said. Police also confirmed that undetonated explosives were found on the island.
No group has said it carried out the attacks.

Car wreckage

In Oslo, rubble and glass from shattered windows littered the streets and smoke from the fires drifting across the city could be seen in television footage from the devastated government quarter.
Hours after the bomb struck, officials said some people were still inside the damaged buildings, some of which were on fire.

Click to play

Advertisement

Norway's prime minister Jens Stoltenberg: 'No one will bomb us into silence'

All roads into the city centre have been closed, said national broadcaster NRK, as security officials evacuated people from the area, fearing another blast.
Government officials urged people to stay at home and avoid central areas of Oslo.
Earlier Egil Vrekke, Assistant Chief Constable of Oslo police told the BBC the rescue operation in Oslo was ongoing.
"We are issuing warnings just [to] make sure people are not in the area in case there are further explosions," he told the BBC.
"We have cordoned off large areas. There are bomb experts at the scene investigating whether there are other devices in the area."
A few hours after the explosion, a gunman opened fire at a camp in Utoeya for young members of the Labour Party.
NRK journalist Ole Torp said there were reports the gunman had been armed with a handgun, an automatic weapon and a shotgun.
"He travelled on the ferry boat from the mainland over to that little inland island posing as a police officer, saying he was there to do research in connection with the bomb blasts," he told the BBC.

Continue reading the main story

• Oslo blast: Your pictures

"He asked people to gather round and then he started shooting, so these young people fled into the bushes and woods and some even swam off the island to get to safety."

Mr Stoltenberg had been due to visit the camp on Saturday. Foreign Minister Jonas Gahr Store, who visited the camp on Thursday, praised those who were attending.
"The country has no finer youth than young people who go for a summer camp doing politics, doing discussions, doing training, doing football, and then they experience this absolutely horrendous act of violence."

'Focus on rescue'

State Secretary Kristian Amundsen said Friday was a public holiday in Norway so the government offices were not as busy as they might usually have been.
"But there are many hundreds of people in these buildings every day," he told the BBC.
"We have to focus on the rescue operation - there are still people in the building, there are still people in the hospital."

Click to play

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Journalist Hanne Taalesen on island attack: "There are reports that youths hid in bushes"

Reuters said the oil ministry was among the other government buildings hit, while NRK journalist Ingunn Andersen said the headquarters of tabloid newspaper VG were also damaged.
"It's complete chaos here. The windows are blown out in all the buildings close by," she told AP.

Oistein Mjarum, head of communications for the Norwegian Red Cross, which has offices nearby, said the blast could be heard across Oslo.

"We have never had a terrorist attack like this in Norway - if that's what it is - but of course this has been a great fear for all Norwegians when they have seen what has been happening around the world."
The United States has condemned the "despicable acts of violence" in Oslo, while the President of the European Council, Herman Van Rompuy, said he was "deeply shocked" by "these acts of cowardice for which there is no justification".

Microsoft annual profit soars on Xbox 360 demand revenue

SAN FRANCISCO--U.S. technology giant Microsoft said Thursday its annual profit soared on record revenue thanks in part to hot demand for its Xbox 360 video game console gear and online network.
Microsoft reported its net income surged 23 percent to US$23.15 billion on record high revenue of US$69.94 billion in the fiscal year that ended June 30.

The annual results came with word that Microsoft posted profit of US$5.87 billion on record revenue of US$17.37 billion in the fiscal fourth quarter that ended June 30.

“Throughout fiscal 2011, we delivered to market a strong lineup of products and services which translated into double-digit revenue growth, and operating margin expansion,” said Microsoft chief financial officer Peter Klein.

Microsoft Business Division revenue grew 16 percent for the year, with the Redmond, Washington-based company selling more than 100 million licenses for the latest version of its Office software.

“We continue to see strong business demand across all our products, from small businesses all the way up to the largest global enterprises,” said Microsoft chief operating officer Kevin Turner.

Businesses recovering from the economic meltdown of two years ago continued to spend money replacing or upgrading computer gear, while consumer spending outside the workplace remained soft.

“Basically, Office put the ball over the goal line again,” said Rob Helm, managing vice president of research at private analyst firm Directions on Microsoft.

Microsoft said its online services unit saw revenue climb 15 percent during the year, primarily driven by gains in income from Internet search.

Bing's share of the U.S. search market had grown to 14.4 percent by the end of June, according to the company.

Revenue from Microsoft's Entertainment & Devices Division leaped 45 percent for the year due to “ongoing momentum” of the Xbox 360, Kinect gesture-sensing controllers for the consoles and the Xbox Live network that connects consoles to online games, films and other digital offerings.

Xbox Live membership has reached 35 million, according to Klein.

While the business division remains “the bright spot” at the company, sales of Windows operating software and licenses were being hurt by a shift from personal computers to smart mobile devices such as tablets, according to Helm.

“We are not expecting a Microsoft tablet solution to show up for at least a year,” the analyst said. “The tablet problem is going to be chewing away throughout fiscal year 2012.”

Another challenge facing Microsoft is that demand for personal computers is growing most in emerging markets where prices are lower and software piracy prevalent.

More than half of personal computers shipped in the past year went to emerging markets, according to Microsoft executives who predicted that meant lower average selling prices and higher piracy rates in the coming year.

“The economies doing best are in countries where they are reluctant for pay for software,” Helm said.

Microsoft saw companies embracing Office 365, which offers business software as services in the Internet “cloud.”

Microsoft said it remains committed to its deal to power Internet search at Yahoo! websites and the companies are working together to “uncover and address gaps and inefficiencies” in the merged technology platform.

“We are totally aligned with Yahoo,” Klein said. “The collaboration is fantastic and we will have this turned around by the end of this calendar year

Republican House Speaker John Boehner quits debt talks

Republican House Speaker John Boehner has walked away from crunch debt ceiling talks at the White House with US President Barack Obama.

Mr Obama said Mr Boehner had rejected an "extraordinarily fair deal" that would have included $650bn (£400bn) of cuts to entitlement programmes.

Mr Obama said he had been willing to take "a lot of heat" from his party.

Explaining the walkout, Mr Boehner told his Republican colleagues: "In the end, we couldn't connect."

"I have decided to end discussions with the White House and begin conversations with the leaders of the Senate in an effort to find a path forward," Mr Boehner said in a letter to the Republican rank and file.

The president called for new talks with congressional leaders on Saturday at 1100 (1500 GMT).

'Call not returned'

The talks were aimed at avoiding what analysts say would be a financially catastrophic US debt default on 2 August.

"It is hard to understand why Speaker Boehner would walk away from this kind of deal," President Obama said at a news conference on Friday evening.

"There are a lot of Republicans who are puzzled as to why it couldn't get done," he added.

Senior Republican aides said President Obama and congressional Republicans had been close to reaching a deal last week, but that the White House had changed its demand to call for higher taxes.

White House correspondents said Mr Obama looked visibly angry as he told reporters that until "sometime early today when I couldn't get a phone call returned, my expectation was that Boehner was going to go to his caucus" to help finalise a deal.

Despite the breakdown in talks, Mr Obama said on Friday he was confident the $14.3tn (£8.7tn) limit on US borrowing would be raised by the approaching deadline.

But the president also countenanced for the first time the possibility of the US not meeting its financial obligations.

"If we default, then we're going to have to make adjustments," he said.

Mr Obama said he was "fed up" with political posturing and was willing to "sign an extension of the debt ceiling which takes us through 2013".

'Taxes destroy jobs'

In his letter to congressional colleagues, Mr Boehner said the president was "emphatic that taxes have to be raised".

"As a former small businessman, I know tax increases destroy jobs," he added.

Republicans have been unwilling to consider raising new tax revenues to counter the growing budget deficits.

The Democrats have been opposed to cutting popular healthcare and welfare programmes for pensioners and the poor.

Earlier on Friday, the Democratic-led US Senate rejected a "cut, cap and balance" bill passed by the Republican-led House, which would have severely cut public spending and forced the government to balance its budget.

Vodafone Sees Strong Emerging Markets Growth

This article has been adapted from Fool U.K., our sister site across the pond.

First-quarter results show Europe struggling, but nice growth elsewhere.

Vodafone (Nasdaq: VOD ) may be the world's biggest mobile phone operator, but that hasn't immunized it against the economic woes besetting some of Europe's struggling economies, as we learned from the company's first-quarter update on Friday.

A fall off in demand from some southern European countries has led to growth in service revenues slowing, and that has been compounded by a reduction in mobile charges with some countries' regulatory bodies cutting mobile termination rates.

So a quarter which saw rising sales of smartphones, like the Apple (Nasdaq: AAPL ) iPhone and Google (Nasdaq: GOOG ) Android phones, only brought Vodafone a 1.5% overall increase in revenues, after the previous quarter saw 2.5% growth. But that was still a bit better than most had been expecting.

Europe struggling
Organic European revenues actually fell, by 1.3%, with sales in Spain falling by nearly 10%. But that was nicely countered by a 32% rise in sales in Turkey, with India recording a jump of 17%. Organic revenue from the Africa, Middle East and Asia Pacific region was up by 8.7%, with sales at Vodacom in South Africa growing by 7.8%.

And Germany and the UK held up reasonably well too, with the former pretty flat at 0.2% growth, and the latter up 1.7%.

Vodafone says the results were as expected and is sticking to its existing full-year guidance of an operating profit between 11bn pounds and 11.8bn pounds, with chief executive Vittorio Colao saying:

We have made a good start to the year, reporting robust results despite challenging macroeconomic conditions across southern European economies and the impact of cuts to mobile termination rates. Revenue from our key focus areas of data, enterprise and emerging markets continues to grow strongly. With our broad geographical mix and improving market positions, we are well placed for the rest of the financial year.
Dividends to come
Vodafone's forecast dividend yield stands at around 5.8%. With Vodafone telling us that its free cash flow for the quarter of 1.3bn pounds is supporting its dividend target, and with full year expectations of 6bn pounds to 6.6bn pounds of the stuff flowing in, the chances of that not happening seem pretty slim. It's among the best of the big dividends on the market at the moment.

After selling off its 44% stake in French operator SFR for the sum of 6.8bn pounds, Vodafone has seen its net debt figure fall to 23.1bn pounds. That might sound like a pretty eye-watering sum, but it is less than a third of the company's total market capitalization of 82bn pounds. And that bit of cash isn't going to be hanging around for long anyway, with a share buyback of 4bn pounds under way, which is already 10% complete.

Some might prefer a bigger attack on the debt figure, while others might like a dividend boost, but the board can presumably see the same attraction in the current share price as can those canny dividend investors who are tucking a few away in their income portfolios.

Minority stakes
And there could be a nice bit of extra cash coming Vodafone's way in the not too distant future too, from its 45% share of Verizon Wireless. Majority shareholder Verizon Communications (NYSE: VZ ) has so far been concentrating on paying down its debts, but its second-quarter results are due the same day, and observers will be hoping for some news on the commencement of dividends.

Further disposals and acquisitions were announced during the quarter, with the sale of Poland's Polkomtel to go ahead, while Vodafone has reached an agreement for the purchase of a further 33% chunk of Vodafone Essar in India, continuing the company's strategy of pulling out of minority-stake telcos and concentrating on its major holdings.

All in all, I reckon these figures underline the strength of Vodafone. Despite the tough local European economy, Vodafone will almost certainly do better than most of the continent's mobile operators, and it's clearly managing its emerging markets business pretty well, too.

The shares look cheap to me.

McDonald's profits rise 15% on higher global sales

Fast food giant McDonald's has seen its quarterly profits soar 15% on higher sales across all its global regions.

Its net profit for the three months to 30 June totalled $1.41bn (£866m), compared with $1.23bn a year earlier.
Revenue growth was led by Europe, where McDonald's same-store sales increased by 5.9%. They rose by 4.5% in US, and by 5.2% for the rest of the world.
Group-wide revenues totalled $6.91bn, up 16% from $5.95bn a year ago.
McDonald's chief executive Jim Skinner said the latest results showed the company's resilience in the face of "the continuing challenges of our economic environment".
The company said the cost of most of its ingredients in the US and Europe was continuing to rise between 4% and 4.5% on an annual basis as food price inflation remains high

Norway’s capital shaken by bomb blast

BERLIN — A massive explosion rocked the Norwegian capital, Oslo, on Friday afternoon, blowing out the windows of a large government office building and damaging several others, including one that holds the prime minister’s office. Local news reports said police confirmed at least two deaths.
Police said that a bomb caused the explosion, according to Norwegian news agency NTB. The target appeared to have been the Ministry of Petroleum and Energy, according to a police officer on the scene who spoke to the Dagbladet newspaper.

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A loud explosion shattered windows Friday at the government headquarters in Oslo which includes the prime minister's office, injuring several people. (July 22)

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• Norway's capital shaken by bomb blast

“Central Oslo looks more like a battlefield,” said a spokesman for the police directorate, Runar Kvernen. “The headquarters of the Norwegian government is almost destroyed. It damaged a lot of a of buildings.”
Smoke could be seen billowing from a high-rise government building on video images of central Oslo, and debris littered the streets. There were several injured people covered in blood. Reporters on the scene said that the area had not been crowded on a Friday afternoon when many people were on vacation.
Prime Minister Jens Stoltenberg was safe and had not been in the area at the time of the explosion, which occurred about 3:30 p.m., a spokesman told the Associated Press.
Kvernen, the police spokesman, also said that “another very dramatic situation is developing” north of Oslo at a youth summer political conference, where shots had been reported fired. He said that police were still gathering details but could not rule out that the incidents were connected.
Oslo University Hospital had received seven injured people by late afternoon, a spokesman told Reuters. It was not immediately clear what kind of bomb had exploded or where it had been, but NRK television broadcast images of a blackened, damaged vehicle turned on its side near the site of the blast.
Other Scandinavian countries have been the targets of terrorism, most recently Sweden in December, when two explosions hit Stockholm; in one of the blasts, a suspected terrorist bomber killed himself and injured two other people in a central area of the city. The suspect had made recordings condemning Sweden’s involvement in Afghanistan.
Norway has also contributed significantly to the NATO-led effort to protect civilians in Libya, sending several F-16 jets that had been carrying out 10 percent of the strikes on the country since March, according to the Norwegian Air Force. The aircraft are scheduled to return home at the end of the month.
Earlier this month, Libyan leader Moammar Gaddafi threatened Europe with suicide bombings as revenge for the NATO campaign.
Norway had also filed charges last week against an Iraqi-born cleric, Mullah Krekar, a founder of the Kurdish militant group Ansar al-Islam, for threatening Norwegian officials with death if he was deported from the country.

Breaking News Alert: Bomb caused deadly explosion in Oslo, police say

The powerful explosion that tore open several Oslo buildings, including the prime minister’s office, on Friday, killing at least one person, was caused by a bomb, a Norwegian news agency said, citing police accounts.

Prime Minister Jens Stoltenberg is safe, government spokeswoman Camilla Ryste told the Associated Press.

Clinton in India for Economic, Security Talks

U.S. Secretary of State Hillary Clinton arrived in India late Monday for two days of talks aimed at strengthening political and economic relations with the South Asian country.

Clinton's visit is part of an ongoing U.S.-India strategic dialogue that began last year with talks in Washington.

The secretary of state will spend Tuesday in discussions with senior Indian officials.  Despite the economic focus, the talks will also cover U.S. planned withdrawal from Afghanistan and India's strained relations with arch-rival Pakistan.

On Wednesday, Clinton will travel to the southeastern city of Chennai, where she is scheduled to deliver a speech on the importance of U.S.-Indian relations and meet representatives of U.S. companies.

Her trip comes less than a week after a series of blasts in India's financial hub Mumbai killed 19 people.

No one has claimed responsibility for the triple bombings that wounded more than 130 others.

The U.S.-India civil nuclear cooperation agreement finalized in 2008 will be a topic for discussion at the strategic dialogue session.  Indian leaders are also expected to bring up American visa laws that affect Indian professionals in the United States.

As India's Economy Booms, Demand for Private Jets Grows

In India, the demand for private jets is growing at a rapid pace as an expanding economy throws up a new class of billionaires, millionaires and affluent businessmen.

Mahesh Iyer is a senior executive at the Bangalore-based Shamanur Group.  It is involved in businesses ranging from sugar mills to real estate, education and aviation.

He is among a growing number of Indian businessmen and corporate executives who frequently use a private jet to fly them whenever and wherever they want.

Iyer says it helps save time and gives company executives better control over their schedule.

“Now I am in Colombo, I have got only one flight going to Bangalore in the evening, so if somebody wants to go in the morning, then he can take a private jet, I mean if it is important that he has to go for a meeting in the morning,” Iyer explained. 

More money

As the ranks of the affluent increase in India, so too the numbers of private jets. The tally of private planes in the country is now 142 - up nearly 50 percent in three years. This is a fraction of the number in Western countries like the United States, but according to the global consulting firm, Frost and Sullivan, India has the maximum number of private jets in Asia - more than in China.  

The private planes vary from the Hawker Beechcrafts to the luxurious Airbus corporate jet.  India’s richest man - Reliance Industries chief Mukesh Ambani -- gave an Airbus jet to his wife as a gift.

While India’s growing band of billionaires and millionaires are snapping up their own jets, many businesses are hiring them from a host of private jet charters that have come into the market to take advantage of the growing demand.

Lease or own?

Bangalore-based Jupiter Aviation is one of the companies that leases private jets. Julian D’Souza, a Jupiter executive, says business is expanding at nearly 15 percent a year.

“Private jets is a happening thing," explained D'Souza. "What happened in U.S. and Europe about 10 years back is happening today in India, slowly getting on to corporate honchos where people do not have time to go and wait at an airport and get a commercial flight, so this is the most happening thing. You just enter the airport, and you walk into your aircraft and in most places, your vehicle walks [comes] right to the gate and picks you up.”

Rental costs vary from $1500 dollars an hour for a smaller aircraft to $100,000 an hour for the bigger and more luxurious planes.

But that does not deter customers, who want to escape flight delays, traffic jams, and need faster connectivity.  

Convenience

Aviation analysts say the private planes are not just seen as symbols of wealth but as a necessary cost of doing business efficiently.

Aviation analyst Rajan Mehra in New Delhi says the rapid growth of the economy in the last five years has helped businesses expand their operations both within and outside India.

But commercial flights are still limited to major metropolitan areas, excluding many parts of the vast country, and prompting a range of businessmen to fly in private planes.  

“It is not just industrialists right now who are going in private jets, even corporate heads, even medium level businessmen who are realizing that with distances far in India," noted Mehra, "where infrastructure is not always available for large commercial jets in the interiors, the best thing is to do is to have a small plane and be able to visit their factories, their other offices in the interiors so India is bound to be among the top countries as far as private jets go.”

It is certainly boom times for the industry. And with forecasts that India’s business jet fleet could grow three times by the end of this decade, more Bomardiers, Gulfstreams and Cessnas are expected to be seen in Indian skies.

Greece Pledges Debt Eradication After Second Financial Package

Greece is expressing relief after securing a second European-backed emergency financial package aimed at preventing Athens from defaulting on its huge public debt and stabilizing the common European currency.

The European Union and the International Monetary Fund reached agreement Thursday in Brussels to give Greece another bailout worth about $155 billion.  Greece will also get voluntary loans from the private sector to help cover the financial gap.

EU President Herman van Rompuy and European Commission President Jose Manuel Barroso said participants unanimously supported the package they described as a Marshall Plan for Greece to ensure the sustainability of its debt and prevent the crisis from spreading. 

Greek Finance Minister Evangelos Venizelos says the bailout package is "a great relief" for the Greek economy, which will be gradually passed on to the "real economy."  But Venizelos added that Athens will not relax its efforts to eradicate its debt.

Greece has imposed a set of austerity measures - including tax hikes and budgetary cuts - that have sparked violent protests.

In the past year, Greece - and later, Ireland and Portugal - were forced to secure international financial assistance from their European neighbors and the International Monetary Fund.

Leaders of the European countries using the euro said they have agreed on measures to prevent future crisis from occurring instead of acting after it happens.

They said Greece is expected to receive an estimated $53 billion credit from the private sector, to ensure that Greek banks can operate within the euro system.  But those contributions will be voluntary.

Eurozone leaders also pledged to provide adequate resources to re-capitalize Greek banks if needed, but stressed the private sector will not be involved in financial bailouts for other eurozone countries.  Barroso said Greece is an exceptional case that requires a unique solution.

In a statement, the leaders of 17 euro countries and their financial institutions said they are determined to continue to provide support to countries under EU financial aid programs, provided they commit to implement the necessary reforms.  They welcomed Ireland's and Portugal's resolve to implement their austerity programs

Bill to Raise US Debt Ceiling Advances - For Now

 Representatives has passed a bill tying an increase in the federal borrowing limit to deep spending cuts, limits on future spending, and a proposed constitutional amendment requiring a balanced budget. The Republican-sponsored measure is expected to fail in the Democratically-controlled Senate, leaving the United States without a clear path to deficit reduction as the clock ticks toward a possible default on America’s $14.3 trillion national debt.

The Cut, Cap, and Balance Act passed on a mostly party-line vote in the Republican-controlled chamber. The bill would cut non-defense federal spending, limit future spending to less than 20-percent of America’s gross domestic product, and require a constitutional mandate that the United States balance its books every year. It would extract significant savings from so-called entitlement programs that provide income and health care to retirees, but would not increase revenues.

In an era of massive federal deficits, ballooning national debt, and a stagnant economy, Republicans say strong medicine is required. House Budget Committee Chairman Paul Ryan:

“We cannot keep spending money we do not have," said Ryan. "Forty-two cents out of every dollar coming out of Washington is borrowed money, 47 percent of it from other countries, China number 1 [most of all]. Mr. Speaker, you cannot have sovereignty, self-determination as a country if we are relying on other governments to cash-flow [finance] half of our deficit.”

Democrats, like Representative John Yarmuth of Kentucky, said the measure would place the full burden of fiscal austerity on America’s poor and vulnerable.

“What Cut, Cap, and Balance would really mean is slash, shred, and punish," said Yarmuth. "Slash the budget, shred the safety net, and punish American citizens who can least afford it. All while protecting the wealthiest, most successful [people].”

Most observers view the bill as an academic exercise designed to appease the ultra-conservative Tea Party wing of the Republican Party. The bill is highly unlikely to pass the Senate, and would face a presidential veto even if it did.

At the White House, President Barack Obama barely mentioned the Cut, Cap, and Balance Act, focusing instead on a new plan put forth by a bipartisan group of Senators, the so-called Gang of Six. The president hailed the plan’s inclusion of spending cuts, entitlement reforms, and tax provisions - what  Obama called a balanced approach to deficit reduction.

“We now have a bipartisan group of senators who agree with that balanced approach," said President Obama. "And we have got the American people, who agree with that balanced approach.”

The president urged congressional leaders to turn the plan into a bill that could be voted on as soon as possible, noting that the clock is ticking towards an August 2 deadline for raising the federal borrowing limit. Without action, the United States risks defaulting on its debt obligations.

Speaking with reporters, the Senate’s top Republican, Mitch McConnell, would only say that the Gang of Six proposal merits consideration. On the Democratic side, Majority Leader Harry Reid praised the work done by the Gang of Six, but questioned whether enough time exists to enact the gang’s far-reaching proposal before August 2, given the often-cumbersome rules that govern Senate proceedings.

“I do not want to do anything to jeopardize the enthusiasm people have for the Gang of Six," said Reid. "But I understand what the rules of the Senate are.”

Senators Reid and McConnell have been working on a plan of their own that would allow President Obama to raise the debt ceiling in installments without majority votes in Congress. It is seen as a fallback plan in the event that debt negotiations fail. If enacted, it would avert the immediate threat of default, but would do little to fix America’s long-term fiscal woes.

White House and Congressional Leaders: No Default on US Debt

The White House and congressional leaders remain adamant the United States will not default on its $14.3 trillion national debt, less than three weeks before a deadline for raising the federal borrowing limit.  But a bipartisan deal to put the nation on a sustainable fiscal path shows no sign of materializing.

On one point top Democrats and Republicans agree: failing to raise America’s debt ceiling in time to avert a default on federal obligations is unthinkable.  Jacob Lew is President Barack Obama’s top budget official. "All the leaders of Congress and the president have acknowledged that we must raise the debt limit, and the question is how," he said.

Lew spoke on ABC’s This Week television program.

The Senate’s number-two Republican, Jon Kyl, had a similar message. “The country will not default.  Whether or not there are savings achieved in the process remains open to question," he said.

Weeks of negotiations have failed to yield a so-called “grand bargain” to trim U.S. budget deficits by $4 trillion over 10 years.  The impasse has prompted several fallback plans to raise the debt ceiling if the $4 trillion target is not met.

Senate leaders are negotiating a plan that would allow President Obama to extend the federal borrowing limit even if majority votes in Congress do not materialize authorizing such a move.  In the Republican-controlled House of Representatives, a vote is expected later this week that would tie a debt ceiling increase to a more-modest deficit reduction target, as well as a constitutional amendment requiring a balanced budget.

Neither plan of last resort is seen as solving America’s fiscal woes.  Appearing on CBS’ Face The Nation program, Republican Senator Tom Coburn of Oklahoma criticized any attempt to shield Congress from painful votes to raise the borrowing limit. “It takes the pressure off all the politicians.  It allows us to pass a debt limit [increase] without making the hard choices that this country has to make," he said.

Another Republican, Senator Marco Rubio of Florida, blasted any scaling back of deficit reduction goals. “The real problem here is not the debt limit.  The real problem here is the debt.  If all we do is raise the debt limit, and it is not accompanied by a credible solution to America’s debt problem, we are in big trouble," he said.

August 2 is the deadline for raising the federal government’s borrowing limit.  Beyond that date, treasury officials say the U.S. government risks default.

Some Republican lawmakers have questioned this assertion, saying the United States could service the national debt and fulfill core obligations using tax revenue alone.  Democrats and the White House dispute the claim, saying the government would have to choose between interest payments on the debt, funding programs that provide income and health care for retirees, and funding the U.S. military.

Office of Management and Budget Director Jacob Lew says there is still time strike a deal and avert financial ruin.  But he adds that time is running out. “It is kind of unfortunate that things always have to get to the last minute.  Sometimes there are no consequences.  Right now, we are in a place where the world is watching, and we should get our business done," he said.

Credit ratings agencies have warned of a possible downgrading of U.S. debt, which would make U.S. Treasury bonds less attractive to investors and creditor nations and require higher interest rates to attract purchasers.  Economists warn that higher interest rates would cripple America’s shaky economic recovery

Apple Faces Class Action Suit in South Korea

Photo: Reuters

A woman uses an Apple iPhone 4 smartphone for Web surfing during a photo opportunity at an Apple store in Seoul, May 24, 2011

U.S. technology giant Apple may face a class action lawsuit in South Korea for an iPhone feature that can track the location of users.

Apple Korea said Thursday that it paid a $950 judgment last month to a lawyer who sued the company for violation of privacy.

The lawyer, Kim Hyeong-seok, now says he will lead a class action suit against the company.  His law firm, Mirae Law, said it set up a Web site to find people who want to participate in the suit, but it was shut down because of heavy traffic.

There are around 3 million iPhone users in South Korea and the suit could have worldwide consequences for Apple.

Islamic Banking Divides Nigerian Religious Leaders

Nigeria is introducing Islamic banking to bring more of the nation's estimated 70 million Muslims into the economy. But many prominent Christian leaders say it will further inflame religious violence.

How it works

Islamic law prohibits paying or receiving interest or investing in businesses that provide goods or services that are contrary to Islamic principles.

That has led to the creation of interest-free, Islamic banking in more than 50 nations where customers share in profits and losses. In an Islamic mortgage, for example, the bank buys the house then resells it at a higher price, allowing the new homeowner to pay in installments.

Ziyad Muhammad of the Islamic Finance Institute of South Africa says Islamic banking is about creating wealth for the community.

“The ultimate objective is to ensure that anything that is introduced by the entrepreneur is done for the benefit of the community at large,” he said.

Muhammad took part in a Central Bank of Nigeria conference meant to counter Christian opposition to the introduction of Islamic banking.

Christian criticism

The Christian Association of Nigeria says the move violates the country's secular constitution and comes at a dangerous time when security forces are battling Islamic fundamentalists who are fighting for an independent nation ruled by Islamic law.

At the St. Peter Claver Catholic church, Father Paul Anyansi recognizes the potential economic benefits of Islamic banking but believes its dangers are far greater.

“We have too many religious tensions in terms of Islam against Christians. So it could stir up more. This is not the time for it," he said. "The policies for Islamic banking are good in the sense where there is no loan and interest. It doesn't go against the beliefs of the Islams. But what we are trying to say is that this country is not mature for it now.”

Father Anyansi says Christian leaders understand that Islamic banking works in other countries and might eventually work in Nigeria, but not right now.

“It could be as effective as it is England, as it is in America, as it is in Malaysia or countries where it is operated. But for now, we are still growing. A lot of people are not accepting their brother as their brother. They are not accepting the differences between religions. It will create more problems than more gains,” he said.

Secular vs Islamic

Human rights activist Oke Adheke says Nigeria can not run on both a secular system and an Islamic system.

“The moment they gave it a religious coloration it is not good for this country. Islamic banking by the name is not good for this country. Let them give us banking products that they believe are good for the ordinary man. The problem with this country is that we introduce too many funny things and tell stories about them, yet they don't work,” said Adheke.

Banker Solomon Osiobe says people are afraid of Islamic banking because it is new, but he believes it can help the economy if everyone understands its rules.

“Let's give it a chance because it has its advantages and disadvantages. If the rules are set out to be followed by the people who are to be served and there is public alertment, this banking system can go on,” he said.

Alternative

In this time of religious tension, Jaiz International Bank's Mohammed Mustapha Bintube says, Nigeria needs an alternate method of financing based on fairness, equity, and transparency.

“Islamic banks also, deliberately, we don't finance anything that is harmful to society. So we only look for projects that make positive impact in people's lives,” he said.

Nigeria's Conference of Islamic Organizations says opposition to Islamic banking is ignorant and insincere as it says some political leaders are trying to link Islamic financing to terrorism at a time when London and Paris are competing to be the center of Islamic banking.

The Christian Association of Nigeria says it will challenge the introduction of Islamic banking in court.

Obama, Republicans Still Wrangling Over US Debt

The political wrangling over spending, debt, and taxes continued in Washington Friday, with President Barack Obama and opposition Republicans holding separate news conferences to outline their positions.

The Republican Speaker of the House of Representatives, John Boehner, said his party does not want a default. He also said it is vital to make what he called “real” spending cuts without increasing taxes.
On Thursday, after days of talks that have brought little visible progress, President Obama told negotiators it is “decision time” and gave them until Saturday to evaluate their options and reach an agreement.
The president planned a separate televised meeting with journalists later Friday.
The two sides face an August 2 deadline to raise the $14.3 trillion legal limit on the amount of money Washington can legally borrow. Both sides agree there need to be cuts in spending to reduce the U.S. debt, but disagree on what programs to reduce. Republicans also oppose Mr. Obama’s plan to raise taxes on wealthy Americans and large corporations.
Without an agreement, the United States would not be able to pay some of its obligations after the deadline. If that happens, two major rating agencies have warned they will cut the nation’s credit rating. A lower credit rating means lenders would demand higher interest rates to finance U.S. debt, which would make the financial situation worse.
The top two leaders in the U.S. Senate are working on a proposal that will allow the president to raise the debt limit on his own without prior congressional approval. The plan being discussed by Democratic Majority Leader Harry Reid and Republican leader Mitch McConnell would give Mr. Obama the authority to raise the debt limit by $2.5 trillion in three separate installments, while imposing several trillion in spending cuts over the next decade.
Treasury Secretary Timothy Geithner has said “it’s time we move” on an agreement. Federal Reserve Chairman Ben Bernanke said failing to raise the debt limit would be a calamity. He has also warned making spending cuts too quickly could damage the fragile economic recovery.

Nigerian Labor Leaders Call Strike Over Minimum Wage

Nigerian labor leaders are calling for a three-day general strike next week to protest failures to pay a new, national minimum wage.

Negotiations on a new minimum wage for Nigerians began more than two years ago with labor unions proposing as much as $340 a month. Lawmakers eventually settled on about $118 a month, or 18,000 Naira.

But nearly three months after that bill became law, few of the lowest paid workers in the public and private sectors are earning that wage.

"Those ones who are on the high side they are making it, but the masses are not making it," said Anne Elijah who works in a stationery shop in the Ikoyi neighborhood of Lagos.  "There are so many people out there who are suffering. We still need the intervention of the government to make things perfect for us."

Elijah says many parents can no longer afford school fees, but are afraid to ask for more money because employers have an ample pool of job seekers from which to replace them.

"Year in, year out we still collect the same salary and things are not OK," added Elijah.  "But they just leave it they way you collect [your salary] then you can't shout. If you say it, they will not answer you. They believe that if you don't want to work you can go. People are out there looking for jobs."

At the St. Peter Claver Catholic Church, Father Paul Anyansi says much of his congregation is just getting by.

"It's very, very important that we have a minimum wage that can cater for the basic needs of people in this country where there is a lot of inflation," added Anyansi.  "Things like kerosene, basic things are getting out of hand. Rents are getting out of hand."

So labor leaders are calling a three-day general strike next week to force private sector employers as well as federal, state, and local governments to pay the legal minimum wage.

"I know Nigeria is not even among the poorest countries," said Ahmed Mai Sakala, chairman of the Nigerian Labor Congress for Gombe State.  "But what we are in need of is committed leaders who will oversee the affairs of people in this country. And that is why we are in this case."

Lawmakers trying to avert the strike are calling for labor leaders to be patient. Sakala says all levels of government have had months to prepare for higher wage bills.

"The president of this country has signed it into law and yet even the federal government could not implement," added Sakala.  "It is very unfortunate. The labor will stand and make everybody to follow the law of this land."

Some governors say they are already spending too much on petrol subsidies to pay a higher minimum wage.

"The governors who are saying that unless fuel is deregulated before they can pay they are only saying nonsense," said Akeem Kazeem, chairman of the Lagos State Council of the Trade Union Congress of Nigeria. "Because of the fact that this is the law. So anything short from 18,000 [Naira] minimum wage, it will not be taken."

Kazeem says the strike is meant to force private sector employers to comply with the law as well.

"Eighteen-thousand is minute from what is expected," Kazeem added.  "And if they fail to implement, we will not hesitate to go on strike. The idea of private sector employing casual labor with 5,000 Naira is out of the way."

Even if the strike is successful, there are many Nigerians who will not earn the higher wage. Economists estimate that as much as 80 percent of people here in Lagos work in the informal economy. Registered businesses with fewer than 50 employees are exempt from the minimum wage requirement.

Pentagon: Foreign Spies Stole 24,000 Classified Documents

The U.S. Defense Department has revealed a foreign government accessed 24,000 classified files in a cyberattack earlier this year, highlighting the need for its newly unveiled strategy to counter cyberthreats.
Deputy Defense Secretary William Lynn said Thursday the attack in March was just one of a number of security breaches to U.S. defense computer networks. These attacks have compromised some of the Pentagon's “most sensitive systems,” including surveillance and satellite communications.
He did not say which government was behind the March incident, but China has been blamed for some attacks in the past.
In a speech at the National Defense University, Lynn said the Pentagon is actually more worried about cyberattacks by terrorist organizations than by other governments. He said terrorists are more likely to hack into a network in order to damage and disrupt the power grid or financial systems.
The government's new cyberstrategy focuses mainly on defending computer networks from intrusions — by keeping workers alert against viruses, building more resilient network systems, and collaborating with other federal agencies, private companies and foreign allies.
But Joint Chiefs of Staff Vice Chairman James Cartwright told reporters this new strategy is inadequate. In an interview before Lynn's speech, Cartwright said the government needs to develop a more aggressive strategy to show attackers they will face a steep penalty for trying to break into U.S. networks.
He said the Pentagon is still figuring out the legal precedents governing this relatively new field.

US Man Charged With Inciting Terrorism

A U.S. man has been charged with using a website to “promote violent jihad” and posting instructions on how to make a bomb.
The U.S. Justice Department said Thursday 22-year-old Emerson Begolly moderates the popular Ansar al-Mujahideen English Forum. In a statement, officials accused Begolly of placing a number of postings in the last year, encouraging attacks against U.S. targets including police stations, post offices, and synagogues.
The statement says Begolly also posted comments praising the October 2010 shootings at the Pentagon and the Marine Corps Museum, saying he hoped the shooter had been inspired by his postings encouraging violent acts that “seem small but cause big damage.”
Assistant Attorney General Lisa Monaco said the case shows how “homegrown extremists” can use the Internet to incite violence.
U.S. Attorney Neil MacBride said the allegations show how U.S. youths can be influenced by and participate in jihadist propaganda that poses “a serious threat” to public safety.
Begolly has been charged with solicitation to commit a crime of violence and distribution of information relating to explosives. If convicted, Begolly could face up to 30 years in prison.
The Justice Department says Begolly also faces separate charges from February, related to firearms and for allegedly assaulting federal agents. Those charges carry a maximum penalty of life in prison.

Mourners Say Final Farewell to Betty Ford

Family, friends and admirers have said a final farewell to former U.S. first lady Betty Ford, who died last week at the age of 93.
Mrs. Ford, an outspoken advocate for women's rights and those battling addiction, was memorialized Thursday in the Michigan church where she married Gerald Ford more than six decades ago. Former president Bill Clinton and former first lady Barbara Bush were in attendance, as well as former vice president Dick Cheney and his wife, Lynne Cheney.
Mrs. Cheney remembered the former first lady as a woman with style and courage, saying she changed lives for the better or saved lives through her efforts to fight breast cancer and addiction.
Mrs. Ford was laid to rest Thursday next to her husband, on what would have been his 98th birthday, on the grounds of the Gerald Ford Presidential Museum in Grand Rapids, Michigan.
Her flower-draped casket arrived Wednesday night in her hometown of Grand Rapids, where hundreds of people participated in a procession and public viewing.
On Tuesday, mourners paid tribute to Mrs. Ford at a service in Palm Desert, California. Those in attendance included U.S. first lady Michelle Obama and former president George W. Bush.
As first lady from 1974 to 1977, Mrs. Ford became known for her candor, famously discussing women's rights, premarital sex and abortion in a television interview. She was diagnosed with breast cancer while at the White House, and became a champion for breast cancer research and awareness.
After leaving the White House, she acknowledged and sought treatment for an addiction to alcohol and painkillers. In 1982, she co-founded the Betty Ford Center in California, still one of the most well-known and well-regarded treatment centers for substance abuse.
Mr. Ford, who died in 2006, was her second husband. The two wed shortly before he was elected to Congress in 1948. He became vice president in 1973 after the resignation of Spiro Agnew — and became president in 1974 after the Watergate scandal led president Richard Nixon to resign.