Asian markets up after positive US, China data

HONG KONG: Asian markets rose Monday as dealers cheered an improvement in the US unemployment rate and another batch of figures indicating China's economy is emerging from a long slowdown.

Investors appeared unmoved by figures confirming Japan's economy shrank in the three months to September, as traders keep their sights on Sunday's general election, which is expected to see Yoshihiko Noda's government ousted.

Tokyo rose 0.25 per cent by the break, Hong Kong added 0.58 per cent, Shanghai was 0.26 per cent higher, Sydney gained 0.26 per cent and Seoul climbed 0.13 per cent.

Washington on Friday unveiled figures showing the economy added 146,000 jobs in November, up from a revised 138,000 in October. Expectations had been for just 80,000 jobs to be added.

The Labor Department also said the unemployment rate dropped to 7.7 per cent last month, its lowest since December 2008, from 7.9 per cent in October.

However, the data were tempered by a University of Michigan consumer sentiment index, which declined to 74.5 from November's five-year-high of 82.7.

Traders are also nervous about the lack of progress on Capitol Hill in talks aimed at averting the fiscal cliff of tax hikes and spending cuts due to take effect on January 1 and which would likely tip the economy into recession.

Wall Street was mixed, with the Dow up 0.62 per cent and the S&P 500 gaining 0.29 per cent but the Nasdaq lost 0.38 per cent.

In China the government said Sunday that November had seen a double-digit increase in production at factories, workshops and mines for the first time since March.

Figures on retail sales, fixed asset investment and inflation reinforced the view that the economy is finally on the mend after seven straight quarters of slowdown in growth.

"Overall it's a quite strong set of numbers, supporting our view of rebounding GDP growth," said Lu Ting, China economist with Bank of America Merrill Lynch.

Figures released on Monday showed exports rose 2.9 per cent in November, while imports were flat.

On currency markets the euro bought $1.2904 and 106.40 yen in early Asian trade, down from $1.2928 and 106.64 yen in New York Friday afternoon. The dollar bought 82.47 yen, from 82.46 yen.

The yen has come under pressure in recent weeks after polls were called for December 16. Noda and his Democratic Party of Japan are expected to be beaten by the Liberal Democratic Party, headed by former prime minister Shinzo Abe.

Abe has promised to push a more aggressive monetary easing policy to kickstart the economy.

Oil prices were higher, with New York's main contract, light sweet crude for delivery in January, gaining 29 cents to $86.22 a barrel and Brent North Sea crude for January delivery adding 39 cents to $107.41.

Gold was at $1,705.60 at 0250 GMT compared with $1,696.90 late on Friday.

- AFP/ck

Read More..

India misguided, paranoid over China: Guha

Shreya Roy Chowdhury, TNN Dec 8, 2012, 06.12AM IST

MUMBAI: A good half-hour into the discussion on 'India, China and the World', historian Ramachandra Guha issued a disclaimer—all the three members on the panel had been to China only once. "We should learn their language, promote quality research, and have a panel on China driven by Chinese scholars," he said. And that was the general tenor of the debate—that the Indian attitude to China was influenced by a mix of ignorance, cautious optimism about partnerships and a whole lot of misguided paranoia. "Don't demonise the Chinese, please," Guha finally said in response to a question.

"China has existed in our imaginations," observed Sunil Khilnani, professor of politics and author of The Idea Of India. "There's been very little sustained engagement with the reality of China and very little of our own produced knowledge about China." It was after the events of 1962 ('war' in the popular imagination, 'skirmish' to the scholars participating in the discussion), explained Khilnani, that a miffed India "withdrew". It's the 50th anniversary of that exchange this year, and "what we haven't been able to do is learn from the defeat", observed Khilnani. Both could have benefited from greater engagement. "China has had a very clear focus on primary education and achieved high levels of literacy before its economic rise. It has also addressed the issue of land reform," said Khilnani. Guha added that China could learn from the "religious, cultural and linguistic pluralism" in India.

But China and India weren't always so out of sync with each other. Srinath Raghavan, a scholar of military history, got both Guha and Khilnani to talk about pre-1962 relations between the two when the picture was rosier. Tagore was interested in China and so was Gandhi. Both were very large countries with large populations and shared what Guha calls a "lack of cultural inferiority". "They were both," he continued, "also heavily dependent on peasant communities." Nehru was appreciative of China's will to modernize and industrialize and its adoption of technology to achieve those ends. In turn, Chinese politicians argued for Indian independence.

Things soured more, feel both Khilnani and Guha, after the Dalai Lama fled to India in 1959. "He was welcomed here as a spiritual leader but the intensification of the conflict dates to the Dalai Lama's flight," said Guha. Both Guha and Khilnani argued that Nehru's decision to not react aggressively to China's occupation of Tibet was, in the long run, the right one and prevented further "militarization" of the region. An audience member wondered if that didn't make India "China's puppet". Guha disagreed. "If there's a Tibetan culture alive today," he said, "it's not because of Richard Gere. Don't believe in the hypocrisy of the Western countries. Will they give them land, employment, dignified refuge? The Tibetans is one of the few cases in which our record is honorable."

But the difference in levels of development and the lopsided trade relations between the two countries have only fuelled the suspicions many Indians seem to harbour about China. People were worried, said Guha, even about cricket balls made in China. Audience questions reflected those worries. A member asked about China's "strategy to conquer the world" and its likely impact on India. Guha cautioned against stereotypes; Khilnani explained, "History is littered with the debris of states that have tried to dominate the world. What we're doing may be more long-lasting."

Read More..

Smokers celebrate as Wash. legalizes marijuana

SEATTLE (AP) — The crowds of happy people lighting joints under Seattle's Space Needle early Thursday morning with nary a police officer in sight bespoke the new reality: Marijuana is legal under Washington state law.

Hundreds gathered at Seattle Center for a New Year's Eve-style countdown to 12 a.m., when the legalization measure passed by voters last month took effect. When the clock struck, they cheered and sparked up in unison.

A few dozen people gathered on a sidewalk outside the north Seattle headquarters of the annual Hempfest celebration and did the same, offering joints to reporters and blowing smoke into television news cameras.

"I feel like a kid in a candy store!" shouted Hempfest volunteer Darby Hageman. "It's all becoming real now!"

Washington and Colorado became the first states to vote to decriminalize and regulate the possession of an ounce or less of marijuana by adults over 21. Both measures call for setting up state licensing schemes for pot growers, processors and retail stores. Colorado's law is set to take effect by Jan. 5.

Technically, Washington's new marijuana law still forbids smoking pot in public, which remains punishable by a fine, like drinking in public. But pot fans wanted a party, and Seattle police weren't about to write them any tickets.

In another sweeping change for Washington, Gov. Chris Gregoire on Wednesday signed into law a measure that legalizes same-sex marriage. The state joins several others that allow gay and lesbian couples to wed.

The mood was festive in Seattle as dozens of gay and lesbian couples got in line to pick up marriage licenses at the King County auditor's office early Thursday.

King County and Thurston County announced they would open their auditors' offices shortly after midnight Wednesday to accommodate those who wanted to be among the first to get their licenses.

Kelly Middleton and her partner Amanda Dollente got in line at 4 p.m. Wednesday.

Hours later, as the line grew, volunteers distributed roses and a group of men and women serenaded the waiting line to the tune of "Chapel of Love."

Because the state has a three-day waiting period, the earliest that weddings can take place is Sunday.

In dealing with marijuana, the Seattle Police Department told its 1,300 officers on Wednesday, just before legalization took hold, that until further notice they shall not issue citations for public marijuana use.

Officers will be advising people not to smoke in public, police spokesman Jonah Spangenthal-Lee wrote on the SPD Blotter. "The police department believes that, under state law, you may responsibly get baked, order some pizzas and enjoy a 'Lord of the Rings' marathon in the privacy of your own home, if you want to."

He offered a catchy new directive referring to the film "The Big Lebowski," popular with many marijuana fans: "The Dude abides, and says 'take it inside!'"

"This is a big day because all our lives we've been living under the iron curtain of prohibition," said Hempfest director Vivian McPeak. "The whole world sees that prohibition just took a body blow."

Washington's new law decriminalizes possession of up to an ounce for those over 21, but for now selling marijuana remains illegal. I-502 gives the state a year to come up with a system of state-licensed growers, processors and retail stores, with the marijuana taxed 25 percent at each stage. Analysts have estimated that a legal pot market could bring Washington hundreds of millions of dollars a year in new tax revenue for schools, health care and basic government functions.

But marijuana remains illegal under federal law. That means federal agents can still arrest people for it, and it's banned from federal properties, including military bases and national parks.

The Justice Department has not said whether it will sue to try to block the regulatory schemes in Washington and Colorado from taking effect.

"The department's responsibility to enforce the Controlled Substances Act remains unchanged," said a statement issued Wednesday by the Seattle U.S. attorney's office. "Neither states nor the executive branch can nullify a statute passed by Congress."

The legal question is whether the establishment of a regulated marijuana market would "frustrate the purpose" of the federal pot prohibition, and many constitutional law scholars say it very likely would.

That leaves the political question of whether the administration wants to try to block the regulatory system, even though it would remain legal to possess up to an ounce of marijuana.

Alison Holcomb is the drug policy director of the American Civil Liberties Union of Washington and served as the campaign manager for New Approach Washington, which led the legalization drive. She said the voters clearly showed they're done with marijuana prohibition.

"New Approach Washington sponsors and the ACLU look forward to working with state and federal officials and to ensure the law is fully and fairly implemented," she said.

___

Johnson can be reached at https://twitter.com/GeneAPseattle

Read More..

Egypt president scraps decree that sparked protests

CAIRO (Reuters) - Egyptian President Mohamed Mursi has cancelled a decree that gave him sweeping powers and sparked deadly violence, but did not delay this month's referendum on a new constitution as his opponents had demanded.

The announcement that Mursi had scrapped his November 22 decree followed hours of talks on Saturday at his presidential palace, billed as a "national dialogue" but which was boycotted by his main opponents and had little credibility among protesters.

One opposition group dismissed Mursi's efforts at appeasement as the "continuation of deception."

His opponents have demanded Mursi scrap the vote on December 15 on a constitution that was fast-tracked through an assembly led by Mursi's Muslim Brotherhood and other Islamists. Liberals and others had walked out, saying their voices were not being heard.

Islamists have insisted the referendum should go ahead on time, saying it is needed to complete a democratic transition still incomplete after Hosni Mubarak's overthrow 22 months ago.

The military, which had run the nation during a turbulent interim period after Mubarak fell, stepped into the crisis on Saturday to tell feuding factions that dialogue was essential to avoid "catastrophe." But a military source said that was not a prelude to the army retaking control of Egypt or the streets.

After Saturday's talks, the president issued a new decree in which the first article "cancels the constitutional declaration" announced on November 22, the spokesman for the dialogue, Mohamed Selim al-Awa, told a news conference held around midnight.

But he said the constitutional referendum would go ahead next Saturday, adding that although those at the meeting had discussed a postponement, there were legal obstacles to taking such a step.

The political turmoil has exposed deep rifts in the nation of 83 million between Islamists, who were suppressed for decades, and their rivals, who fear religious conservatives want to squeeze out other voices and restrict social freedoms. Many Egyptian just crave stability and economic recovery.

RESPONSE

Islamists and more liberal-minded opponents have both drawn tens of thousands of supporters to the streets in rival rallies since Mursi's decree last month. Seven people were killed in violence around the presidential palace, which has been ringed by tanks.

The spokesman for the main opposition coalition, the National Salvation Front, which stayed away from Saturday's talks, said his group would meet on Sunday to discuss a response to Mursi's initiative to cancel his old decree.

But Hussein Abdel Ghani added: "My first personal impression is that it is a limited and insufficient step. We repeatedly said that among our top demands is for the referendum to be delayed."

The April 6 movement, which helped galvanize street protests against Mubarak, said in a statement about the outcome of Saturday's talks, "What happened is manipulation and a continuation of deception in the name of law and legitimacy."

The new decree excluded some elements from the old decree that angered the opposition, including an article that gave Mursi broad powers to confront threats to the revolution or the nation, wording opponents said gave him arbitrary authority.

Another article in the old decree had put beyond legal challenge any decision taken by the president since he took office on June 30 and until a new parliament was elected, a step that can only happen when a new constitution is in place.

That was not repeated, but the new decree said that "constitutional declarations including this declaration" were beyond judicial review.

DIALOGUE

The new decree outlined steps for setting up an assembly to draft a new constitution should the current draft be rejected in Saturday's referendum.

In addition, the opposition was invited to offer suggested changes to the new constitution, echoing an earlier initiative by Mursi's administration for changes to be discussed and agreed on by political factions and put to the new parliament to approve.

Amid the violence and political bickering, the army has cast itself primarily as the neutral guarantor of the nation.

"The armed forces affirm that dialogue is the best and only way to reach consensus," the military statement said. "The opposite of that will bring us to a dark tunnel that will result in catastrophe and that is something we will not allow."

The army might be pushing the opposition to join the dialogue and for Mursi to do more to draw them in, said Hassan Abu Taleb of the Al Ahram Center for Political and Strategic Studies.

He discounted the chance of direct military intervention, adding, "They realize that interfering again in a situation of civil combat will squeeze them between two rocks."

But the military seemed poised to take a more active role in security arrangements for the upcoming referendum.

A Cabinet source said the Cabinet had discussed reviving the army's ability to make arrests if it were called upon to back up police, who are normally in charge of election security.

According to the state-run daily al-Ahram, an expanded military security role might extend to the next parliamentary election and, at the president's discretion, even beyond that.

(Additional reporting by Tamim Elyan; Editing by Peter Cooney)

Read More..

Boehner in hot seat in game of fiscal chicken

WASHINGTON: With room for maneuver slipping away, top US Republican John Boehner is in a bind over how to avoid going over the fiscal cliff: embrace higher taxes and earn conservatives' ire, or scupper a deal and incur Americans' wrath.

Another option, one that few non-partisans see as very viable, is for President Barack Obama to cave in and agree to Republican demands not to raise taxes, even for the wealthiest Americans.

A likelier resolution is a compromise with the White House that avoids the early January shock of automatic spending cuts coupled with tax hikes on nearly all Americans, while laying out enough deficit reduction that eases concern about the country's financial well-being.

In the game of political chicken to see whether Democrats or Republicans blink first, perhaps the trickiest role of all rests with Speaker of the House Boehner, who along with Obama is the principal in the negotiations.

Boehner's guidance of the Republican position in coming days and weeks could signal much about party direction in the wake of an election that saw flagbearer Mitt Romney -- who advocated slashing tax rates across the board -- defeated by Obama.

"To say Boehner is between a rock and a hard place is minimizing the problem he faces," Boston University professor and longtime political consultant Tobe Berkovitz told AFP.

"Boehner is trying to keep public opinion about Republicans from totally cratering, and at the same time keep the Tea Party hardcore conservatives from totally abandoning the party."

Conservative Republican Trent Franks agrees that "our speaker is in an enormously difficult position."

"And I think he's doing the best he can," the congressman told National Public Radio. "That doesn't mean that what he finally arrives at will be something that I can support or it won't. You know, I don't know."

Few people other than Boehner and Obama know the true state of negotiations in what appears as a well-choreographed campaign to thrash out a last-minute deal.

Discussions appear to have stalled, though, and Boehner has accused Obama of having "wasted another week" by not pushing talks forward.

This weekend Boehner "will be waiting for the White House to respond to our serious offer about averting the fiscal cliff," his spokesman Michael Steel told AFP.

Obama has proposed US$1.6 trillion in new taxes over the next decade from higher rates on the wealthiest two percent of Americans.

Republicans countered with a plan for US$800 billion in tax revenue raised by closing loopholes and ending some deductions. Both plans were rejected.

A Democratic official said Saturday that "nothing has changed since yesterday."

Polls show most Americans want to see taxes rise on the wealthy.

With Obama winning re-election on November 6, and his Democrats gaining seats in both the House and Senate, Republicans concede privately -- and some publicly -- that the Democrats have the upper hand.

"President Obama pretty well holds all the cards in this negotiation," Republican Senator Ron Johnson told Fox News.

"If he wants to have tax increases or tax rates go up, I don't see how Republicans can stop him."

Public trust is not in Boehner's favour. A Washington Post/Pew poll this week showed 53 percent of Americans would blame Republicans should the economy dive off the cliff; 27 percent would blame Democrats.

In his weekly address Saturday, Obama said he was willing to find ways to reduce health costs and make more entitlement spending cuts, but as for asking "the wealthiest Americans to pay higher tax rates -- that's one principle I won't compromise on."

Potential future Republican leaders like Senator Marco Rubio are unlikely to want to bend to White House's will.

Rubio, a possible 2016 presidential candidate, gave the Republican response to Obama's address -- and said "tax increases will not solve our US$16 trillion debt."

Boehner has said that, too, but his position is tenuous. On Friday he left open the possibility for compromise on a tax rate rise.

In past negotiations, such as last December's battle over extending the payroll tax holiday, some Republicans felt Boehner gave away too much.

Hashtags on Twitter -- #boehnermustgo, #fireboehner -- have recently left little doubt that some Republicans are fed up with his handling of the talks.

With conservatives demanding unity on taxes, Boehner faces the prospect of revolt from his right flank should he agree to a deal that would raise high-end rates.

Berkovitz said Republicans face two options if they want to avoid the cliff: negotiate and compromise, or hold their noses and "give Obama what he wants. If it goes south, take the election victory in two years and maybe four years."

- AFP/ir

Read More..

India misguided, paranoid over China: Guha

MUMBAI: A good half-hour into the discussion on 'India, China and the World', historian Ramachandra Guha issued a disclaimer—all the three members on the panel had been to China only once. "We should learn their language, promote quality research, and have a panel on China driven by Chinese scholars," he said. And that was the general tenor of the debate—that the Indian attitude to China was influenced by a mix of ignorance, cautious optimism about partnerships and a whole lot of misguided paranoia. "Don't demonise the Chinese, please," Guha finally said in response to a question.

"China has existed in our imaginations," observed Sunil Khilnani, professor of politics and author of The Idea Of India. "There's been very little sustained engagement with the reality of China and very little of our own produced knowledge about China." It was after the events of 1962 ('war' in the popular imagination, 'skirmish' to the scholars participating in the discussion), explained Khilnani, that a miffed India "withdrew". It's the 50th anniversary of that exchange this year, and "what we haven't been able to do is learn from the defeat", observed Khilnani. Both could have benefited from greater engagement. "China has had a very clear focus on primary education and achieved high levels of literacy before its economic rise. It has also addressed the issue of land reform," said Khilnani. Guha added that China could learn from the "religious, cultural and linguistic pluralism" in India.

But China and India weren't always so out of sync with each other. Srinath Raghavan, a scholar of military history, got both Guha and Khilnani to talk about pre-1962 relations between the two when the picture was rosier. Tagore was interested in China and so was Gandhi. Both were very large countries with large populations and shared what Guha calls a "lack of cultural inferiority". "They were both," he continued, "also heavily dependent on peasant communities." Nehru was appreciative of China's will to modernize and industrialize and its adoption of technology to achieve those ends. In turn, Chinese politicians argued for Indian independence.

Things soured more, feel both Khilnani and Guha, after the Dalai Lama fled to India in 1959. "He was welcomed here as a spiritual leader but the intensification of the conflict dates to the Dalai Lama's flight," said Guha. Both Guha and Khilnani argued that Nehru's decision to not react aggressively to China's occupation of Tibet was, in the long run, the right one and prevented further "militarization" of the region. An audience member wondered if that didn't make India "China's puppet". Guha disagreed. "If there's a Tibetan culture alive today," he said, "it's not because of Richard Gere. Don't believe in the hypocrisy of the Western countries. Will they give them land, employment, dignified refuge? The Tibetans is one of the few cases in which our record is honorable."

But the difference in levels of development and the lopsided trade relations between the two countries have only fuelled the suspicions many Indians seem to harbour about China. People were worried, said Guha, even about cricket balls made in China. Audience questions reflected those worries. A member asked about China's "strategy to conquer the world" and its likely impact on India. Guha cautioned against stereotypes; Khilnani explained, "History is littered with the debris of states that have tried to dominate the world. What we're doing may be more long-lasting."

Read More..

Smokers celebrate as Wash. legalizes marijuana

SEATTLE (AP) — The crowds of happy people lighting joints under Seattle's Space Needle early Thursday morning with nary a police officer in sight bespoke the new reality: Marijuana is legal under Washington state law.

Hundreds gathered at Seattle Center for a New Year's Eve-style countdown to 12 a.m., when the legalization measure passed by voters last month took effect. When the clock struck, they cheered and sparked up in unison.

A few dozen people gathered on a sidewalk outside the north Seattle headquarters of the annual Hempfest celebration and did the same, offering joints to reporters and blowing smoke into television news cameras.

"I feel like a kid in a candy store!" shouted Hempfest volunteer Darby Hageman. "It's all becoming real now!"

Washington and Colorado became the first states to vote to decriminalize and regulate the possession of an ounce or less of marijuana by adults over 21. Both measures call for setting up state licensing schemes for pot growers, processors and retail stores. Colorado's law is set to take effect by Jan. 5.

Technically, Washington's new marijuana law still forbids smoking pot in public, which remains punishable by a fine, like drinking in public. But pot fans wanted a party, and Seattle police weren't about to write them any tickets.

In another sweeping change for Washington, Gov. Chris Gregoire on Wednesday signed into law a measure that legalizes same-sex marriage. The state joins several others that allow gay and lesbian couples to wed.

The mood was festive in Seattle as dozens of gay and lesbian couples got in line to pick up marriage licenses at the King County auditor's office early Thursday.

King County and Thurston County announced they would open their auditors' offices shortly after midnight Wednesday to accommodate those who wanted to be among the first to get their licenses.

Kelly Middleton and her partner Amanda Dollente got in line at 4 p.m. Wednesday.

Hours later, as the line grew, volunteers distributed roses and a group of men and women serenaded the waiting line to the tune of "Chapel of Love."

Because the state has a three-day waiting period, the earliest that weddings can take place is Sunday.

In dealing with marijuana, the Seattle Police Department told its 1,300 officers on Wednesday, just before legalization took hold, that until further notice they shall not issue citations for public marijuana use.

Officers will be advising people not to smoke in public, police spokesman Jonah Spangenthal-Lee wrote on the SPD Blotter. "The police department believes that, under state law, you may responsibly get baked, order some pizzas and enjoy a 'Lord of the Rings' marathon in the privacy of your own home, if you want to."

He offered a catchy new directive referring to the film "The Big Lebowski," popular with many marijuana fans: "The Dude abides, and says 'take it inside!'"

"This is a big day because all our lives we've been living under the iron curtain of prohibition," said Hempfest director Vivian McPeak. "The whole world sees that prohibition just took a body blow."

Washington's new law decriminalizes possession of up to an ounce for those over 21, but for now selling marijuana remains illegal. I-502 gives the state a year to come up with a system of state-licensed growers, processors and retail stores, with the marijuana taxed 25 percent at each stage. Analysts have estimated that a legal pot market could bring Washington hundreds of millions of dollars a year in new tax revenue for schools, health care and basic government functions.

But marijuana remains illegal under federal law. That means federal agents can still arrest people for it, and it's banned from federal properties, including military bases and national parks.

The Justice Department has not said whether it will sue to try to block the regulatory schemes in Washington and Colorado from taking effect.

"The department's responsibility to enforce the Controlled Substances Act remains unchanged," said a statement issued Wednesday by the Seattle U.S. attorney's office. "Neither states nor the executive branch can nullify a statute passed by Congress."

The legal question is whether the establishment of a regulated marijuana market would "frustrate the purpose" of the federal pot prohibition, and many constitutional law scholars say it very likely would.

That leaves the political question of whether the administration wants to try to block the regulatory system, even though it would remain legal to possess up to an ounce of marijuana.

Alison Holcomb is the drug policy director of the American Civil Liberties Union of Washington and served as the campaign manager for New Approach Washington, which led the legalization drive. She said the voters clearly showed they're done with marijuana prohibition.

"New Approach Washington sponsors and the ACLU look forward to working with state and federal officials and to ensure the law is fully and fairly implemented," she said.

___

Johnson can be reached at https://twitter.com/GeneAPseattle

Read More..

Federal Agencies Brace for Deep Cuts Post-'Cliff'

Dec 7, 2012 4:22pm

Toby Jorrin/AFP/Getty Images

With the “fiscal cliff” quickly approaching, federal agencies are stepping up preparations for deep automatic budget cuts that will kick in Jan. 2 unless the White House and Congress can reach a deal.

The Office of Management and Budget told ABC News that a memo went out to federal agencies earlier this week seeking “additional information and analysis” in order to finalize spending cuts required if we go off the cliff.

The agencies are considering which workers to furlough, projects to put on hold and offices that will have to close.

The request follows the administration’s release of a 400-page report in September that outlined the budget areas to be impacted by the $1.2 trillion in automatic spending cuts and what percentages they would be slashed.

READ MORE: White House Details ‘Doomsday’ Budget Cuts

Billions of dollars could be slashed from defense operations and maintenance programs. Medicare would take a two-percent hit, trimming millions in payouts to health care providers. Scientific research programs would be gutted. Aid for the poor and needy would be sharply curtailed.

The report also detailed operations that would be exempt from any cuts, including active-duty military operations, nuclear watchdogs, homeland security officials, veterans care and other critical areas.

READ: Pentagon Begins Planning for ‘Cliff’ Cuts

Asked about the agency preparations underway, White House spokesman Jay Carney said Wednesday that OMB “must take certain steps to ensure the administration is ready to issue such an order should Congress fail to act.”

“Earlier this week, OMB issued a request to federal agencies for additional information to finalize calculations on the spending reductions that would be required,” Carney said.

“This action should not be read … as a change in the administration’s commitment to reach an agreement and avoid sequestration.  OMB is simply ensuring that the administration is prepared, should it become necessary to issue such an order,” he said. “OMB will continue to consult with agencies and will provide additional guidance as needed.  This is just acting responsibly because of the potential for this happening.”

Get more pure politics at ABCNews.com/Politics and a lighter take on the news at OTUSNews.com.

More ‘Fiscal Cliff’ Coverage From Today:

SHOWS: World News

Read More..

Egyptian opposition to shun Mursi's national dialogue

CAIRO (Reuters) - President Mohamed Mursi was expected to press ahead on Saturday with talks on ways to end Egypt's worst crisis since he took office even though the country's main opposition leaders have vowed to stay away.

Cairo and other cities have been rocked by violent protests since November 22, when Mursi promulgated a decree awarding himself sweeping powers that put him above the law.

The upheaval in the most populous Arab nation, following the fall of Hosni Mubarak last year, worries the West, in particular the United States, which has given it billions of dollars in military and other aid since Egypt made peace with Israel in 1979.

Mursi's deputy raised the possibility that a referendum set for December 15 on a new constitution opposed by liberals might be delayed. But the concession only goes part-way towards meeting the demands of the opposition, who also want Mursi to scrap the decree awarding himself wide powers.

On Friday, large crowds of protesters surged around the presidential palace, breaking through barbed wire barricades and climbing on tanks guarding the seat of Egypt's first freely elected president, who took office in June.

As the night wore on, tens of thousands of opposition supporters were still at the palace, waving flags and urging Mursi to "Leave, leave".

"AS LONG AS IT TAKES"

"We will stay here for as long as it takes and will continue to organize protests elsewhere until President Mursi cancels his constitutional decree and postpones the referendum," said Ahmed Essam, 28, a computer engineer and a member of the liberal Dostour party.

Vice President Mahmoud Mekky issued a statement saying the president was prepared to postpone the referendum if that could be done without legal challenge.

Mursi's planned dialogue meeting was expected to go ahead on Saturday in the absence of most opposition factions. "Everything will be on the table," a presidential source said.

Mursi could be joined by some senior judiciary figures and politicians such as Ayman Nour, one of the candidates in Mubarak's only multi-candidate presidential race, in 2005, in which he was unsurprisingly trounced.

The opposition has demanded that Mursi rescind the decree giving himself wide powers and delay the vote set for December 15 on a constitution drafted by an Islamist-led assembly which they say fails to meet the aspirations of all Egyptians.

EXPAT VOTE DELAYED

The state news agency reported that the election committee had postponed the start of voting for Egyptians abroad until Wednesday, instead of Saturday as planned. It did not say whether this would affect the timing of voting within Egypt.

Ahmed Said, leader of the liberal Free Egyptians Party, told Reuters that delaying expatriate voting was intended to seem like a concession but would not change the opposition's stance.

The opposition organized marches converging on the palace which Republican Guard units had ringed with tanks and barbed wire on Thursday after violence between supporters and opponents of Mursi killed seven people and wounded 350.

Islamists, who had obeyed a military order for demonstrators to leave the palace environs, held funerals on Friday at Cairo's al-Azhar mosque for six Mursi partisans who were among the dead.

"With our blood and souls, we sacrifice to Islam," they chanted.

A group led by leftist opposition leader Hamdeen Sabahy has called for an open-ended protest at the palace.

Some pro-Mursi demonstrators gathered in a mosque not far from the palace, but said they would not march towards the palace to avoid a repeat of the violence that took place on Wednesday night.

In a speech late on Thursday, Mursi had refused to retract his decree or cancel the referendum on the constitution, but offered talks on the way forward after the referendum.

The National Salvation Front, the main opposition coalition, said it would not join the dialogue. The Front's coordinator, Mohamed ElBaradei, a Nobel peace laureate, dismissed the offer as "arm-twisting and imposition of a fait accompli".

ElBaradei said that if Mursi were to scrap the decree with which he awarded himself extra powers and postpone the referendum "he will unite the national forces".

Murad Ali, spokesman for the Muslim Brotherhood's Freedom and Justice Party, said opposition reactions were sad: "What exit to this crisis do they have other than dialogue?" he asked.

(This story corrects Mursi's title to president in paragraph 1)

(Additional reporting by Omar Fahmy; Writing by Giles Elgood; Editing by Michael Roddy and Paul Tait)

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Philippine typhoon survivors 'loot' shops

TAGUM, Philippines: Hungry survivors of a deadly Philippine typhoon looted shops and warehouses in a hard-hit town in a bid to stay alive amid stalled aid deliveries, a rescue official said.

Local officials monitored the desperate scenes in the early aftermath of Typhoon Bopha's onslaught in the isolated southern town of Cateel, Cedric Daep, a provincial public safety official, told AFP.

"The food aid took so long to arrive that the locals broke into whatever building left standing in search of something to eat," said Daep, a specialist sent to the south by the government to help rescue and relief operations.

Warehouses and grocery stores were broken into in Cateel, a coastal town near where the eye of the typhoon made landfall on Tuesday, Daep said.

Officials said damage to roads and bridges by floods and landslides trapped 150,000 people for three days in Cateel and the nearby towns of Baganga and Boston, where they said 97 percent of buildings were flattened or unroofed.

The typhoon killed more than 500 people and left hundreds of others missing across the south, rescue officials said.

A Philippine Navy vessel with 31 tonnes of emergency relief and 132 volunteer aid workers reached Baganga on Thursday, navy spokesman Omar Tonsay told AFP, saying he had not heard of the Cateel looting.

Daep, speaking in the city of Tagum, at the edge of the southern disaster zone, said the region suffered its last strong typhoon in 1922, and has little expertise in coping with them.

"You have to organise (pre-disaster) evacuation, relief distribution systems, and putting up temporary shelters... They were not prepared," he said.

Daep said the priority was to ensure a reliable supply of food, safe water, shelter and clothing to the displaced victims, which the national government said included more than 200,000 people who have lost their homes.

"We have been receiving reports of people getting sick because they had been drinking contaminated water," he said.

He urged local governments in the disaster areas to help their people instead of waiting for the national government to organise relief and rehabilitation.

"They should organise cash- or food-for-work programmes to build shelters for the displaced," Daep said.

- AFP/ck

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