January 15th, 2012
The New York Times / By LIZ ALDERMAN
PARIS — As France and other European nations grapple with the downgrade of their sovereign debt by Standard & Poor’s on Friday, a longer-term test looms over whether those nations will now turn toward improving Europe’s economic competitiveness.
Most European countries have embraced the austerity prescribed by Chancellor Angela Merkel of Germany to resolve what markets have identified as the big problems: high debts and budget deficits.
But in their zeal to mend balance sheets, European leaders have rarely been heard talking about how to take advantage of the crisis — as Germany has with past crises — to rebuild their economies by investing in new technologies or making their labor markets more flexible.
“In one sense, the resources — human, natural — of Europe are not much different than before the crisis, so our potential is not that different,” Joseph E. Stiglitz, the Nobel laureate, said in an interview before S.& P. announced its downgrades on Friday. “But what’s clear is that misguided policies and market failures are leading Europe not to use its resources well, by not investing in people and capital, or improving technology, in a way that will help them be more competitive with what’s going on in Asia.”
In addition to France, S.&. P. downgraded the credit ratings of Austria, Italy, Spain, Cyprus, Portugal, Malta, Slovakia and Slovenia.
The ratings agency’s assessment revealed little new about the European crisis. But it was a reminder that underlying the euro zone’s problems — including its fragile banks and political disarray — was a gap in competitiveness between Europe’s wealthy northern countries and the more spendthrift south.
“The current financial turmoil stems primarily from fiscal profligacy at the periphery of the euro zone,” Standard & Poor’s said in a statement. But the agency said the biggest underlying problem was the “divergences in competitiveness between the euro zone’s core and the so-called ‘periphery.’ ”
In this view, politicians, especially in southern European countries like Greece, Portugal and Spain, are focusing so intently on cutting spending and raising taxes to placate international investors that they are not devoting enough resources toward renewing their economies to be more competitive with their northern neighbors and more potent forces like China and Eastern Europe.
In a conference call on Saturday, Moritz Krämer, a managing director at S.& P., said politicians had missed the mark in their diagnosis of the crisis.
“All countries are focusing so much on budget remedies by reducing their excessive deficits, especially in the peripheral countries,” he said. “But the euro crisis is due primarily to a divergence in competitiveness that has not stopped growing between certain euro countries since the introduction of the single currency.”
From that perspective, the focus on stricter budgetary discipline is not enough to cure Europe’s problems, economists say. A few years ago, for instance, Germany’s budget deficit was higher than Spain’s, but the competitiveness of the German economy far outpaced that of its southern neighbor.
A major reason is that Germany had spent the better part of a decade reworking its inflexible labor market and revising a costly and cumbersome social safety net. Those changes have helped turn Germany into the economic powerhouse it is today.
To be sure, being in the euro zone helped. Because the single currency also made the price of German goods less costly, Spain, Portugal and other countries in the south snapped up German products when times were good. Now that their economies have crumbled, they view Germany’s portrayal of them as lazy southerners as unfair.
The issue, economists say, is how to improve productivity, and they ask whether southern European economies can ever be diligently reformed, as Germany’s was. Workers in southern countries, for example, often cite studies showing that they work longer hours than the Germans.
January 15th, 2012
Sumter, South Carolina (CNN) – Mitt Romney gave a handful of cash Saturday to a woman who had told him she was struggling financially after an event in Sumter, South Carolina.
An aide said the GOP candidate gave the supporter "what he had on him" - about $50 or $60.
The woman, Ruth Williams, met Romney earlier in the week and told him she was having trouble making ends meet. On Saturday, Romney recognized Williams while he was shaking hands with supporters after a rally, an aide said.
Romney spoke to the woman and handed her several bills.
"He was kind to me," Williams said. "He held onto me and he made Gov. [Nikki] Haley and them come see about me."
Williams told reporters that on Wednesday she had seen Romney's campaign bus on the highway and followed it to an airport. Aides then invited her to come meet the former governor at an event in Columbia.
"I was on the highway praying and said, 'God, tell me how to get [my] lights on, and I pulled up to a stop sign and his bus was there,'" Williams said.
Williams has been out of work since October and is caring for an ill son. She said that after meeting Romney she had also met South Carolina state treasurer and Romney supporter Curtis Loftis, and said he had given her money. She said she used the money to pay her light bill.
A Romney campaign aide confirmed Loftis had given Williams money.
Williams has been volunteering at Romney's state headquarters in Columbia since the original meeting, she said.
"God didn't tell me to go to nobody else," she said when asked whether she had approached other presidential candidates. "He told me to pray for Romney."
The cash gift is notable from a candidate who has said he would not give away "free stuff" as president but rather would focus on cutting back on federal spending and stimulating private sector growth.
"I know there are some people who run for president that will say, 'Hey, I'm going to give you more. I'll find a way to give you some more. I'll change the rules and give you more money," Romney said at a December event in Conway, New Hampshire. "I'm not that guy. If there's a competition for who will give you the most free stuff, go vote for that guy."
January 15th, 2012
CR Note: What is it with these guys? They are beginning to remind me of the Monty Python comedy troupe, and most especially, "The Knights Who Say Ni"
No doubt, the other Gulf states will soon be told by the ridiculous Iranians "Now go away, and find us a Shrubbery"
CAIRO (AP) — Iran warned Gulf Arab oil producers against boosting production to offset any potential drop in Tehran's crude exports in the event of an embargo affecting its oil sales, the latest salvo in the dispute between the West and the Islamic Republic over its nuclear program.
The comments by Iran's OPEC governor, published Sunday, came as Saudi Arabia's oil minister was quoted the same day denying that his country's earlier pledges to boost output as needed to meet global demand was linked to a potential siphoning of Iranian crude from the market because of sanctions.
World oil markets have been jolted over concerns that Iran may choke off the vital Strait of Hormuz in retaliation for sanctions hampering its ability to sell its oil. Saudi Arabia and other key Gulf Arab producers have recently said they are ready to provide stable and secure supplies of oil.
Iran's official news agency IRNA said Sunday that the U.S. has relayed a message to Iran about security in the Strait of Hormuz. It gave no details, and there was no immediate comment from Washington.
The U.S. recently imposed sanctions targeting Iran's central bank and, by extension, refiners' ability to buy and pay for crude. The European Union is also weighing an embargo on Iranian oil, while Japan, one of Iran's top Asian customers, has pledged to buy less crude from the country.
Mohammad Ali Khatibi, Iran's OPEC governor, was quoted Sunday by the pro-reform Shargh newspaper as saying that attempts by Gulf nations to replace Iran's output with their own would make them an "accomplice in further events."
"These acts will not be considered friendly," Khatibi said, adding that if the Arab producers "apply prudence and announce that they will not participate in replacing oil, then adventurist countries will not show interest," in the embargo.
The embargo concerns are linked to Iran's nuclear program. The West maintains Iran is enriching uranium for weapons purposes while Tehran says its program is for purely peaceful purposes such as generating electricity.
Saudi Arabia, the world's largest oil producer and a close U.S. ally, had said that it was ready to raise its output to accommodate global market needs. The country is the only member of the 12-nation Organization of the Petroleum Exporting Countries that has significant spare capacity, currently estimated at roughly more than 2 million barrels per day.
With concerns building amid the standoff between Iran and the West over Tehran's nuclear program, a string of Asian and Western officials have visited Saudi Arabia over the past week. While offering assurances that it could meet a shortfall in supply through its spare capacity, Saudi officials have also been careful to say that it was an internal matter if nations chose to abide by any sanctions.
Oil Minister Ali Al-Naimi appeared to try to further clarify the country's position in comments published Sunday in the daily Al-Ektisadiyah newspaper.
"We never said that Saudi Arabia is trying to compensate for Iranian oil in the case that sanctions (are enacted)," Al-Naimi was quoted as saying. "We said that we are prepared to meet the increase in global demand as a result of any circumstances."
The kingdom has a production capacity of 12.5 million barrels and is believed to be producing slightly over 9 million to 9.5 million barrels per day.
Iran's warning introduces a new layer of complication to an issue that has the potential for broad regional and global fallout.
"If the regional countries ... say no to what is harmful to the security of the region, then nothing will definitely happen," he said. But if the security of oil traffic in the Strait of Hormuz is violated, "all will be lost," he said.
"If these countries make a mistake and give the green light, this will be a historic green light," Khatibi said.
Saudi Arabia, the Arab world's largest economy, is widely seen as the main counterweight to Iran in the region. Any attempt by Iran to close the Strait of Hormuz, through which a sixth of the world's oil flows, would also affect the export abilities of the major Gulf producers, including Saudi Arabia, Iraq, the United Arab Emirates, Kuwait and Qatar.
While momentum appears to be building for the sanctions by the West, China, another major buyer of Iranian oil, has come out against the measures.
Chinese Premier Wen Jiabao was in Saudi Arabia on Saturday for meeting with officials in which the two countries "pledged to work together to further expand all-around exchanges and cooperation," according to China's Xinhua news agency
Wen said the two sides "should expand trade of crude oil and natural gas and energy-related cooperation as to deepen their energy partnership," Xinhua reported.
During the visit, Saudi state-owned oil giant Aramco and Chinese refiner Sinopec finalized an agreement to develop a 400,000 barrel per day joint venture refinery in the Red Sea city of Yanbu. The deal is just one between China and Gulf producers as the Asian powerhouse reaches out across the world to secure energy supplies for its booming economy.
Associated Press writer Nasser Karimi in Tehran contributed.
January 15th, 2012
An Italian prosecutor confirms he's investigating allegations from passengers and others that the captain of the cruise ship Costa Concordia abandoned the stricken liner before all the passengers had left.
Officials believe the ship's captain, Francesco Schettino, had brought the 114,500-tonne vessel too close to the shore, where it struck the rock, tearing a large gash in the hull.
Three people are confirmed dead after the huge cruise ship carrying more than 4,200 people ran aground on Friday night. Three people -- a South Korean couple and a crew member -- have reportedly been rescued.
Rescuers found the crew member, chief purser Manrico Gianpetroni, after hearing his screams. He suffered a broken leg, Reuters reports.
Rescue crews were searching for 17 missing people in or around the ship, down from around 40 people who were unaccounted for right after the luxury liner went down, Sky News reports.
Updated at 6:50 a.m. ET:
The U.S. Embassy in Rome issues a statement revising the number of Americans estimated on board the Costa Concordia to 125 from 126.
"We continue to account for and provide emergency assistance to them," the Embassy via Twitter.
A Korean couple on their honeymoon were taken off the ship early on Sunday. A third person, reportedly a crew member, was being removed late Sunday morning, according to Sky News.
Stringer/Italy / Reuters
An Italian rescue worker is seen hanging from a helicopter with a person recovered from the Costa Concordia on Sunday.
The task is akin to searching a small town - but one tilted on its side, and largely in darkness and submerged in freezing water. Scores of divers were taking part.Just after dawn on Sunday, a team made voice contact with a third survivor still on board the ship. "We are doing the impossible to reach this person," coastguard spokesman Luciano Nicastro told Italian television.After midnight, rescue workers had found the two South Koreans still alive in a cabin, after locating them from several decks above, and brought them ashore, looking dazed but unharmed.
January 14th, 2012
Fox Charlotte / by Reneé LaSalle
CR Note: Rerun. Been there; done that. Get some new material, Colbert. See the 2007 video below.
Rock Hill, SC - Comedy Central comedian Stephen Colbert says, “I am proud to announce that I am forming an exploratory committee to lay the ground work for my possible candidacy for the Presidency of the United States of South Carolina. I'm doing it!"
The late night announcement Thursday from Colbert made it unofficially official, a tongue in cheek bid to enter and win the South Carolina GOP Primary.
Rick Hill resident Robin Gover says, “I think people take life too seriously & it's funny."
But it may not be a joking matter. In one South Carolina poll the Palmetto State native came out ahead of candidate Jon Huntsman, who finished 3rd in New Hampshire.
Winthrop Freshman Eddie Adams says, “He's pretty good at what he does. I'd say he's up there, he's very competitive."
Sadly for Colbert fans everywhere, it's not gonna happen...">Winthrop Associate Professor of Political Science & African American Studies Adolphus Belk, Jr. says, “The filing deadline has already passed and the South Carolina GOP Primary does not allow write in candidates." ">Professor Belk says any write-in-votes for the comedian wouldn't be considered legitimate and would be tossed out, “A person might simply be saying, 'None of the above. I want something else.'"
Colbert made a similar joking attempt to run on both party tickets for the 2008 primaries.
Rock Hill resident Angela Murdock says, “They'll let anybody run so I guess he feels like he can run too."
This isn't the first time South Carolina politics have been fodder for the late night comedians. Failed Senatorial candidate Alvin Green was ridiculed for a lack of experience (among other things) and Former Governor Mark Sanford made the comedy circuit over antics surrounding his Argentinian mistress.
York Tech student Russell Brown says, “Yeah, it's a joke.">Still, many say it's not the nomination Colbert is really after.
Tega Cay resident Dan Wilkins says, “It's a way for him to get more attention, it's all he's known for is poking fun at people to get attention and make a name for himself."
Professor Belk says fans of The Colbert Report aren't likely to vote for the Republican primary & it's highly unlikely the comedian will sway votes from GOP contenders.