Dow, S&P rise, but Nasdaq sours with Apple in wild day

NEW YORK (Reuters) - A volatile trading session ended with U.S. stocks mostly higher on Wednesday, even as Apple, the most valuable company in the United States, suffered its worst day of losses in almost four years.


In a strange occurrence, Apple accounted for the entirety of the Nasdaq 100's <.ndx> fall of 1.1 percent, while the Dow industrials - which do not include Apple as a component - enjoyed the best day since November 28.


With the drop, Apple shed nearly $35 billion in market capitalization, its biggest one-day market-cap loss ever. The company's market value, or market capitalization, now stands at $506.85 billion.


"Today's move is because of index weightings, with the Nasdaq down because of Apple's decline," said Rex Macey, chief investment officer of Wilmington Trust in Atlanta. "The S&P is up because Apple isn't as big a weight in that index, and the Dow is up even more because it isn't there at all."


The broad market seesawed, with the S&P 500 dropping into negative territory before it rebounded off the 1,400 level, seen as a key support point over the past two weeks. Investors cited comments from President Barack Obama suggesting a potential near-term resolution to the "fiscal cliff" wrangling in Washington as a catalyst for the rebound.


Shares of The Travelers Cos Inc rose 4.9 percent to $74. The stock ranked as the Dow's top percentage gainer after the insurance company said it intended to resume stock buybacks it had temporarily suspended while it assessed its exposure to Superstorm Sandy. The company also said a preliminary estimate of net losses from Sandy was about $650 million after tax.


The Dow Jones industrial average <.dji> rose 82.71 points, or 0.64 percent, to 13,034.49 at the close. The Standard & Poor's 500 Index <.spx> gained 2.23 points, or 0.16 percent, to 1,409.28. But the Nasdaq Composite Index <.ixic> fell 22.99 points, or 0.77 percent, to end at 2,973.70.


Apple, the largest U.S. company by market capitalization and a big weight in both the S&P 500 and the Nasdaq, fell 6.4 percent to $538.79. Apple is down more than 20 percent from an all-time high reached in late September, putting the stock into bear market territory.


Banking shares were led higher by a 6.3 percent jump in Citigroup to $36.46 after the company said it would cut 4 percent of its workforce. The S&P financial sector index <.gspf> climbed 1.3 percent, and Bank of America hit a 52-week high of $10.55 before pulling back slightly. The stock, a Dow component, ended at $10.46, up 5.7 percent for the day.


Cyclical sectors, which are tied to the pace of economic growth, rallied on optimism about progress on a solution to avoid the fiscal cliff. An S&P index of industrial stocks <.gspi> rose 1.1 percent, buoyed by Caterpillar Inc , up 2.2 percent at $86.05, while an S&P index of energy shares <.gspe> climbed 0.7 percent. The Dow Jones Transportation Average <.djt> gained 0.9 percent, with CSX Corp jumping 2.7 percent to $20.16.


Still, Apple struggled throughout the session. Market participants cited a host of reasons for the drop in the iPad maker's stock, including a consultant's report about the company losing share in the tablet market and reports that margin requirements had been raised by at least one clearing firm, as well as year-end tax selling ahead of a possible rise in capital-gains tax rates next year.


On the Washington front, Obama told the Business Roundtable, a group of chief executives, on Wednesday that a fiscal cliff deal was possible "in about a week" if Republicans acknowledged the need to raise taxes on the wealthiest Americans.


Equities have struggled to gain ground recently because of concerns over the fiscal cliff - a series of mandatory spending cuts and tax increases effective in early January that could push the U.S. economy into recession next year. Recently equities have moved on any whiffs of sentiment from Washington in headlines about negotiations.


"Obama's comments generated a lot of optimism, but to the extent the market believes them, that's how much we're setting ourselves up for a decline if that deadline passes with no progress," said Macey, who helps oversee about $20 billion in assets.


In an interview on CNBC after the market closed, U.S. Treasury Secretary Tim Geithner said that uncertainty over the fiscal cliff was standing in the way of stronger economic growth, and that there was no prospect for an agreement if tax rates didn't rise on the wealthiest taxpayers.


The stock of Freeport-McMoRan Copper & Gold Inc fell 16 percent to $32.17 and ranked as the S&P 500's biggest percentage decliner. The company said it was acquiring Plains Exploration & Production Co and McMoRan Exploration Co in two separate deals for $9 billion in cash and stock in a major expansion into energy.


McMoRan Exploration soared 87 percent to $15.82 and Plains surged 23.4 percent to $44.50.


About half of the stocks traded on the New York Stock Exchange closed in positive territory, while about 54 percent of Nasdaq-listed shares ended lower.


Volume was higher than it has been in recent sessions, with about 6.93 billion shares changing hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, above the daily average so far this year of about 6.48 billion shares.


(Editing by Jan Paschal)



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3 Walmart Suppliers Made Goods in Bangladesh Factory


Khurshed Rinku/Associated Press


Burials on Nov. 27 for some of the 112 victims of the garment factory fire in Bangladesh.







Documents found at the Tazreen apparel factory in Bangladesh, where 112 workers died in a fire nearly two weeks ago, indicate that three American garment companies were using the factory during the past year to supply goods to Walmart and its Sam’s Club subsidiary.




The documents — photographed by a Bangladeshi labor organizer after the fire and made available to The New York Times — include an internal production report from mid-September showing that 5 of the factory’s 14 production lines were devoted to making apparel for Walmart.


In a related matter, two officials who attended a meeting held in Bangladesh in 2011 to discuss factory safety in the garment industry said on Wednesday that the Walmart official there played the lead role in blocking an effort to have global retailers pay more for apparel to help Bangladesh factories improve their electrical and fire safety.


Ineke Zeldenrust, international coordinator for the Clean Clothes Campaign, an anti-sweatshop group based in Amsterdam, said Walmart was the company that “most strongly advocated this position.”


The meeting was held in April 2011 in Dhaka, the country’s capital, and brought together global retailers, Bangladeshi factory owners, government officials and nongovernment organizations after several apparel factory fires in Bangladesh had killed dozens of workers the previous winter.


According to the minutes of the meeting, which were made available to The Times, Sridevi Kalavakolanu, a Walmart director of ethical sourcing, along with an official from another major apparel retailer, noted that the proposed improvements in electrical and fire safety would involve as many as 4,500 factories and would be “in most cases” a “very extensive and costly modification.”


“It is not financially feasible for the brands to make such investments,” the minutes said.


Kevin Gardner, a Walmart spokesman, said the company official’s remarks in Bangladesh were “out of context.”


“Walmart has been advocating for improved fire safety with the Bangladeshi government, with industry groups and with suppliers,” he said, adding that the company has helped develop and establish programs to increase fire prevention.


Ms. Zeldenrust said, “Everyone recognized that fire safety was a serious problem and it was a high time to act on it, and Walmart’s position had a very negative impact.” She added, “It gives manufacturers the excuse they’re looking for to say, ‘We’re not to blame.’ ”


Scott Nova, the executive director of the Worker Rights Consortium, a factory monitoring group based in Washington, was also at the meeting. He said that upgrading the factories’ safety would cost a small fraction of what Walmart and other retailers pay for the clothing they import from Bangladesh each year.


Bloomberg News first reported details of the Dhaka meeting on Wednesday.


Walmart has indirectly acknowledged that the factory, Tazreen Fashions, outside Dhaka, was producing some of its apparel, saying in a statement that a supplier had “subcontracted work to this factory without authorization and in direct violation of our policies.” In that statement, issued two days after the Nov. 24 fire, Walmart said, “We have terminated the relationship with that supplier.” Walmart has declined to name the supplier.


After Walmart was shown some of the documents from the factory on Wednesday, Mr. Gardner replied in an e-mail. “As we’ve said, the Tazreen factory was de-authorized months ago,” he wrote. “We don’t comment on specific supplier relationships.”


The photographed documents from the factory indicate that three suppliers — the International Direct Group, Success Apparel and Topson Downs — used the factory to make shirts, shorts and pajamas for Walmart. One document, written in July, provides product descriptions from Success Apparel for Walmart’s Faded Glory house-brand shorts. A photo taken inside the factory after the fire showed a pair of Faded Glory shorts.


The documents indicate that Success Apparel often worked through Simco, a Bangladeshi garment maker.


Mr. Nova of the Worker Rights Consortium said the documents raised questions about Walmart’s statements after the fire.


“It was not a single rogue supplier as Walmart has claimed — there were several different U.S. suppliers working for Walmart in that factory,” Mr. Nova said. “It stretches credulity to think that Walmart, famous for its tight control over its global supply chain, didn’t know about this.”


Mr. Nova works closely with the Bangladesh Center for Worker Solidarity and made the factory documents available.


Investigators also found apparel made for Sears and Disney inside the factory after the fire. Both companies said suppliers had given orders to the factory without their knowledge and authorization.


Mr. Gardner said accredited outside auditors had periodically inspected the factory on Walmart’s behalf. A May 2011 audit gave the factory an “orange” rating, meaning that there were “higher-risk violations” and that it would be re-audited within six months. If a factory gets three orange ratings over two years, it loses Walmart’s approval.


A follow-up audit in August 2011 for Walmart gave Tazreen an improved “yellow” rating, meaning “medium-risk violations.”


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Casio’s new G-Shock smartwatch can display alerts from your iPhone [video]












Since the Dick Tracy cartoon days, every gadget nerd’s dream has been to have a smartwatch. And while smartphones have largely made the need for wearing wristwatches unnecessary, companies continue to search for ways to connect watches and smartphones. Casio’s GB6900AA G-Shock is the latest smartwatch that connects to Apple (AAPL) iPhone 4S and iPhone 5. Using Bluetooth 4.0, the watch can provide a number of notifications such as alerting you when you have new calls, text messages and incoming email. The G-Shock also has a “Phone Finder” feature that’s similar to the Find My iPhone app that lets you locate your misplaced iPhone with the press of a button on your watch. To our disappointment, the G-Shock doesn’t have a built-in microphone for one-button Siri operation, but it does have an automatic time adjuster that changes time zones on the fly.


As with all G-Shocks, the GB6900AA is one tough watch. It has a two-year battery based on 12 hours of Bluetooth syncing per day and 200 meters of water resistance and shock absorption. Casio’s selling the watches for $ 180 at select U.S. department stores and its online website.












A video demonstration of Casio’s new Bluetooth G-Shock follows below.


Get more from BGR.com: Follow us on Twitter, Facebook


Gadgets News Headlines – Yahoo! News


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The Voice Reveals Top Four Contestants















12/04/2012 at 09:35 PM EST



The Voice"'s top six contestants were under double pressure Monday night when they had to sing two songs each. But there was even more stress at Tuesday's elimination.

"It went as well as it could have gone," Team Blake's Terry McDermott said on Monday of his performances of "I Want to Know What Love Is" and Rod Stewart's "Stay with Me." "There was a lot of pressure stripping a song down, but it worked to my advantage."

"I felt good," said Team Cee Lo's Trevin Hunte, who performed "Walking on Sunshine" and Jennifer Hudson's "And I Am Telling You (I'm Not Going)." "I'm confident. I feel like I've really grown. I'm definitely happy with my performance. I just want to see how America votes."

His chance came Tuesday when he and McDermott stood alongside competitors Nicholas David (Team Cee Lo), Cassadee Pope (Team Blake), Melanie Martinez and Amanda Brown (both Team Adam) to hear host Carson Daly reveal the voting results. Keep reading to find out ...

America saved McDermott, Hunte and Pope, but Martinez said goodbye to the competition for good. "I love all of you who have supported me," she said to her fans. "I'm just so grateful for you."

Brown also met the same fate, making David the final member of the top four.

The semi-final show airs Monday at 8:00 p.m. on NBC.

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Study: Drug coverage to vary under health law


WASHINGTON (AP) — A new study says basic prescription drug coverage could vary dramatically from state to state under President Barack Obama's health care overhaul.


That's because states get to set benefits for private health plans that will be offered starting in 2014 through new insurance exchanges.


The study out Tuesday from the market analysis firm Avalere Health found that some states will require coverage of virtually all FDA-approved drugs, while others will only require coverage of about half of medications.


Consumers will still have access to essential medications, but some may not have as much choice.


Connecticut, Virginia and Arizona will be among the states with the most generous coverage, while California, Minnesota and North Carolina will be among states with the most limited.


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Online:


Avalere Health: http://tinyurl.com/d3b3hfv


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Wall Street slips as investors seek cliff progress

NEW YORK (Reuters) - Stocks finished slightly lower in a quiet session on Tuesday as the back-and-forth wrangling over the "fiscal cliff" gave investors little reason to act.


Trading volume was light as legislators continue to negotiate a deal to avoid a $600 billion package of tax hikes and federal spending cuts that would begin January 1 and could push the economy into recession.


Just 5.86 billion shares changed hands on the New York Stock Exchange, the Nasdaq and the NYSE MKT, below the year's daily average of 6.48 billion shares.


A key measure of investor anxiety has remained muted. The CBOE Volatility Index or VIX <.vix>, a gauge of market anxiety, was at 17.12, up 2.9 percent. It has not traded above 20 since July.


Optimism for progress was dented after remarks by President Barack Obama, who rejected a Republican proposal to resolve the crisis as "out of balance" and said any deal must include a rise in income tax rates on the wealthiest Americans.


"People don't know if what's going on is political posturing or real negotiations that represent progress," said Bernard Baumohl, managing director and chief global economist at the Economic Outlook Group in Princeton, New Jersey.


Expectations of higher taxes on dividends beginning in 2013 have pushed many companies to pay special dividends this year or advance their next payback to investors. Coach became the latest to move up the date of its next dividend payment, and the news lifted shares of the upscale leather-goods maker earlier in the session. By the close, though, Coach was down 1.2 percent at $57.52.


One of the S&P 500's top sectors for the day was health care <.gspa>, considered a defensive group.


The Dow Jones industrial average <.dji> fell 13.82 points, or 0.11 percent, to 12,951.78 at the close. The Standard & Poor's 500 Index <.spx> dipped 2.41 points, or 0.17 percent, to 1,407.05. The Nasdaq Composite Index <.ixic> shed 5.51 points, or 0.18 percent, to close at 2,996.69.


The market has been sensitive to rhetoric from Washington, as a failure to reach an agreement could send the U.S. economy back into recession. Still, many expect a resolution to be found, which could extend the S&P 500's rally of 12 percent so far this year.


Differences within the Republican Party came to the fore on Tuesday as one senator opposed to raising taxes lashed out at Republican House Speaker John Boehner for proposing to increase revenue by closing some tax loopholes.


Congressional Republicans recently proposed steep spending cuts to bring down the budget deficit, but gave no ground on Obama's call to raise tax rates on the rich. The proposal was quickly dismissed by the White House.


"We're on hold trying to figure it out, but investors are stressed since they have to make decisions soon about how to proceed with their investments if taxes are indeed going up. We could see a real pick-up in volume over the next week or so," Baumohl said.


Netflix Inc was the S&P 500's top percentage gainer, advancing 14 percent to $86.65 after Walt Disney Co agreed to give the company exclusive TV distribution rights to its movies, starting in 2016.


Intel Corp shares rose 2.2 percent to $19.97 after the top chipmaker sold $6 billion in bonds to fund stock buybacks and other business activities.


Darden Restaurants Inc shares plunged 9.6 percent to $47.40 as the S&P 500's worst performer after the company warned that its latest quarter would miss expectations after unsuccessful promotions led to a decline in sales at its Olive Garden, Red Lobster and LongHorn Steakhouse chains.


In contrast, Big Lots Inc surged 11.5 percent to $31.27 after the close-out retailer posted a smaller-than-expected loss and boosted its full-year adjusted earnings forecast.


MetroPCS Communications shares tumbled 7.5 percent to $9.96 after Sprint Nextel appeared unlikely to make a counter-offer for the wireless service provider.


Almost half of the stocks traded on the New York Stock Exchange closed lower, while 50 percent of Nasdaq-listed shares closed in negative territory.


After the closing bell, Pandora Media Inc


shares plunged 23 percent after the company reported its third-quarter results.

(Editing by Jan Paschal)

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Changing of the Guard: How Crash Cover-Up Altered China’s Succession





BEIJING — “Thank you. I’m well. Don’t worry,” read the post on a Chinese social networking site. The brief comment, published in June, appeared to come from Ling Gu, the 23-year-old son of a high-powered aide to China’s president, and it helped quash reports that he had been killed in a Ferrari crash after a night of partying.




It only later emerged that the message was a sham, posted by someone under Mr. Ling’s alias — almost three months after his death.


The ploy was one of many in a tangled effort to suppress news of the Ferrari crash that killed Mr. Ling and critically injured two young female passengers, one of whom later died. The outlines of the affair surfaced months ago, but it is now becoming clearer that the crash and the botched cover-up had more momentous consequences, altering the course of the Chinese Communist Party’s once-in-a-decade leadership succession last month.


China’s departing president, Hu Jintao, entered the summer in an apparently strong position after the disgrace of Bo Xilai, previously a rising member of a rival political network who was brought down when his wife was accused of murdering a British businessman. But Mr. Hu suffered a debilitating reversal of his own when party elders — led by his predecessor, Jiang Zemin — confronted him with allegations that Ling Jihua, his closest protégé and political fixer, had engineered the cover-up of his son’s death.


According to current and former officials, party elites, and others, the exposure helped tip the balance of difficult negotiations, hastening Mr. Hu’s decline; spurring the ascent of China’s new leader, Xi Jinping; and playing into the hands of Mr. Jiang, whose associates dominate the new seven-man leadership at the expense of candidates from Mr. Hu’s clique.


The case also shows how the profligate lifestyles of leaders’ relatives and friends can weigh heavily in backstage power tussles, especially as party skulduggery plays out under the intensifying glare of media.


Numerous party insiders provided information regarding the episode, speaking on the condition of anonymity for fear of reprisals from the authorities. Officials have investigated the aftermath of the car wreck, they say, including looking into accusations that a state oil company paid hush money to the families of the two women.


Under Mr. Hu, Mr. Ling had directed the leadership’s administrative center, the General Office, but was relegated to a less influential post in September, ahead of schedule. Last month, he failed to advance to the 25-person Politburo and lost his seat on the influential party secretariat.


Mr. Hu, who stepped down as party chief, immediately yielded his post as chairman of the military, meaning he will not retain power as Mr. Jiang did. “Hu was weakened even before leaving office,” said a midranking official in the Organization Department, the party’s personnel office.


Mr. Ling’s future remains unsettled, with party insiders saying that his case presents an early test of whether Mr. Xi intends to follow through on public promises to fight high-level corruption.


“He can decide whether to go after Ling Jihua or not,” said Wu Guoguang, a former top-level party speechwriter, now a political scientist at the University of Victoria in British Columbia. “Either way, this is a big card in Xi Jinping’s hand.”


Mr. Ling, 56, built his career in the Communist Youth League. At an early age, he secured the patronage of Mr. Hu, who led the Youth League in the early 1980s and brought Mr. Ling to the General Office in 1995. “Hu didn’t come with a lot of friends, but Ling was someone he knew he could trust,” said the Organization Department official. “Officials said that if Ling called, it was like Hu calling.”


Mr. Ling played a central role in moving Youth League veterans into high offices and undermining Mr. Hu’s adversaries. Mr. Ling also wielded leverage over Internet censorship of leaders’ affairs, and sought to use it to benefit his patron.


“Negative publicity, including untruths, about Xi Jinping were not suppressed the way publicity about Hu Jintao was,” said one associate of party leaders.


As his influence grew, Mr. Ling tried to keep a low profile. About a decade ago, his wife closed a software company she owned and formed a nonprofit foundation that incubates young entrepreneurs. The couple sent their son, Ling Gu, to an elite Beijing high school under an alias, Wang Ziyun. “Ling Jihua told his family not to damage his career,” a former Youth League colleague said. “But it seems it can’t be stopped.”


Still living under an alias, Ling Gu graduated from Peking University last year with an international relations degree and began graduate studies in education. One of his instructors said his performance plunged later in his undergraduate years. “I think there were too many lures, too much seduction,” he said.


Before dawn on March 18, a black Ferrari Spider speeding along Fourth Ring Road in Beijing ricocheted off a wall, struck a railing and cracked in two. Mr. Ling was killed instantly, and the two young Tibetan women with him were hospitalized with severe injuries. One died months later, and the other is recovering, party insiders said.


Ian Johnson and Edward Wong contributed reporting.



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HTC, Apple ordered to show which patents were included in their settlement agreement












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PHOTO: See Molly Mesnick's Baby Belly

Jason and Molly Mesnick Pregnant: Baby Bump Photo
Noah Graham


Happy holidays! Celebrities gathered to celebrate the season Saturday, attending the Second Annual Santa’s Secret Workshop in West Hollywood, Calif. Presented by Bill Horn and Scout Masterson and held at the Andaz Hotel, the event benefitted L.A. Family Housing.


Among the revelers: Bachelor alums Jason and Molly Mesnick — whose first child together is due in March — attending their first event since announcing the happy news.


“I’m just about six months and feeling really good,” Molly tells PEOPLE.


“I’m at a perfect stage now so I’m trying to get as much done around the house as I possibly can while I have the energy.”

Also in attendance? Tori Spelling, Malin Akerman, Tiffani Thiessen, Ali LandryDavid Boreanaz, Marla Sokoloff, Kaitlin Olson and Rob McElhenney, Angela Bassett, Ian Ziering, Amanda Righetti, Marshall and Jamie Anne Allman, Kimberly Van Der Beek, Spencer Grammer and more.


Guests enjoyed manicures from Mom.me, cookie decorating with Jenny Cookies, photos with Santa from HP, create-a-card with Snapfish.com, and a craft bar from Jo-Ann Fabrics and Crafts.


Styled by Sybarite Designs, the event featured companies such as  SodaStream, Corolle, Stokke, Orbit Baby, Ergo Baby, Teddy Needs a Bath, Funktion, Numi Numi Design, Ju-Ju-Be, Innobaby and Joovy showcasing their latest products — be sure to enter this week’s giveaway for a chance to win them all!


Tori Spelling
Noah Graham


It was a family affair for Tori Spelling, who brought the whole gang for their first public event since 3-month-old Finn‘s birth in August.


Joining the actress, husband Dean McDermott and their newborn are Hattie, 13 months, Stella, 4, and Liam, 5½.


“I’m not going to lie. It’s a little crazy. It’s hard work,” Spelling tells PEOPLE.


“I think three was safe. Four tips you over the edge a little bit. Maybe it’s because they’re 10 months apart — but we’re so blessed. It keeps you on your toes.”


Malin Akerman
Noah Graham


With her first child on the way in April, Malin Akerman was all smiles at the event, posing with her growing belly.


“I’m feeling great,” the actress tells PEOPLE. “I’m closing in on five months now so it’s getting more and more exciting as time goes by.”


Tiffani Thiessen
Noah Graham


White Collar star Tiffani Thiessen gave 2-year-old daughter Harper Renn a leg up at the event.


On the Landry-Monteverde family’s list? Meeting Santa! PEOPLE.com blogger Ali Landry held 13-month-old son Marcelo Alejandro while husband Alejandro Monteverde snuggled in behind 5-year-old daughter Estela Ines.


Ali Landry
Noah Graham


Amanda Righetti
Tiffany Rose/WireImage


Ravishing redhead Amanda Righetti showed off her growing belly at the event — The Mentalist star is due this winter with her first child.


David Boreanaz
Noah Graham


No Bones about it – David Boreanaz‘s children look like him! The actor and wife Jaime Bergman brought kids Jaden, 10, and Bella, 3, to meet Santa.


Always Sunny in Philadelphia stars Kaitlin Olson and Rob McElhenney brought their elder son Axel, 2, to the event, but little Leo, 7 months, sat this one out.


Kaitlin Olson
Tiffany Rose/WireImage


Angela Bassett
Noah Graham


Meeting Santa was twice as nice for Angela Bassett and Courtney B. Vance, who brought along their 6-year-old twins Bronwyn Golden and Slater Josiah (peace out, dude).


Kimberly Van Der Beek
Tiffany Rose/WireImage


Who cares about photos — it’s time for a snack! PEOPLE.com blogger Kimberly Van Der Beek gives 2-year-old daughter Olivia (plus her doll!) a lift.


Picture perfect! Ian Ziering gets daughter Mia, 19 months, in the frame while enjoying the craft table. The actor and wife Erin expect their second child in May.


Ian Ziering
Meagan Reidinger


Marla Sokoloff
Meagan Reidinger


With a baby doll in tow, PEOPLE.com blogger Marla Sokoloff and her little lady, 9-month-old Elliotte, check out the event.


Spencer Grammer arrived with her main men — husband James Hesketh and their son, 13-month-old Emmett.


Spencer Grammer
Tiffany Rose/WireImage


Marshall and Jamie Ann Allman
Tiffany Rose/WireImage


The event was a baby bump debut for Marshall and Jamie Anne Allman as well — the True Blood and Killing stars just announced that they’re expanding their family — by two. Twins are on the way this spring!


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Fossil fuel subsidies in focus at climate talks

DOHA, Qatar (AP) — Hassan al-Kubaisi considers it a gift from above that drivers in oil- and gas-rich Qatar only have to pay $1 per gallon at the pump.

"Thank God that our country is an oil producer and the price of gasoline is one of the lowest," al-Kubaisi said, filling up his Toyota Land Cruiser at a gas station in Doha. "God has given us a blessing."

To those looking for a global response to climate change, it's more like a curse.

Qatar — the host of U.N. climate talks that entered their final week Monday — is among dozens of countries that keep gas prices artificially low through subsidies that exceeded $500 billion globally last year. Renewable energy worldwide received six times less support — an imbalance that is just starting to earn attention in the divisive negotiations on curbing the carbon emissions blamed for heating the planet.

"We need to stop funding the problem, and start funding the solution," said Steve Kretzmann, of Oil Change International, an advocacy group for clean energy.

His group presented research Monday showing that in addition to the fuel subsidies in developing countries, rich nations in 2011 gave more than $58 billion in tax breaks and other production subsidies to the fossil fuel industry. The U.S. figure was $13 billion.

The Paris-based Organization for Economic Cooperation and Development has calculated that removing fossil fuel subsidies could reduce carbon emissions by more than 10 percent by 2050.

Yet the argument is just recently gaining traction in climate negotiations, which in two decades have failed to halt the rising temperatures that are melting Arctic ice, raising sea levels and shifting weather patterns with impacts on droughts and floods.

In Doha, the talks have been slowed by wrangling over financial aid to help poor countries cope with global warming and how to divide carbon emissions rights until 2020 when a new planned climate treaty is supposed to enter force. Calls are now intensifying to include fossil fuel subsidies as a key part of the discussion.

"I think it is manifestly clear ... that this is a massive missing piece of the climate change jigsaw puzzle," said Tim Groser, New Zealand's minister for climate change.

He is spearheading an initiative backed by Scandinavian countries and some developing countries to put fuel subsidies on the agenda in various forums, citing the U.N. talks as a "natural home" for the debate.

The G-20 called for their elimination in 2009, and the issue also came up at the U.N. earth summit in Rio de Janeiro earlier this year. Frustrated that not much has happened since, European Union climate commissioner Connie Hedegaard said Monday she planned to raise the issue with environment ministers on the sidelines of the talks in Doha.

Many developing countries are positive toward phasing out fossil fuel subsidies, not just to protect the climate but to balance budgets. Subsidies introduced as a form of welfare benefit decades ago have become an increasing burden to many countries as oil prices soar.

"We are reviewing the subsidy periodically in the context of the total economy for Qatar," the tiny Persian gulf country's energy minister, Mohammed bin Saleh al-Sada, told reporters Monday.

Qatar's National Development Strategy 2011-2016 states it more bluntly, saying fuel subsides are "at odds with the aspirations" and sustainability objectives of the wealthy emirate.

The problem is that getting rid of them comes with a heavy political price.

When Jordan raised fuel prices last month, angry crowds poured into the streets, torching police cars, government offices and private banks in the most sustained protests to hit the country since the start of the Arab unrest. One person was killed and 75 others were injured in the violence.

Nigeria, Indonesia, India and Sudan have also seen violent protests this year as governments tried to bring fuel prices closer to market rates.

Iran has used a phased approach to lift fuel subsidies over the past several years, but its pump prices remain among the cheapest in the world.

"People perceive it as something that the government is taking away from them," said Kretzmann. "The trick is we need to do it in a way that doesn't harm the poor."

The International Energy Agency found in 2010 that fuel subsidies are not an effective measure against poverty because only 8 percent of such subsidies reached the bottom 20 percent of income earners.

The IEA, which only looked at consumption subsidies, this year said they "remain most prevalent in the Middle East and North Africa, where momentum toward their reform appears to have been lost."

In the U.S., environmental groups say fossil fuel subsidies include tax breaks, the foreign tax credit and the credit for production of nonconventional fuels.

Industry groups, like the Independent Petroleum Association of America, are against removing such support, saying that would harm smaller companies, rather than the big oil giants.

In Doha, Mohammed Adow, a climate activist with Christian Aid, called all fuel subsidies "reckless and dangerous," but described removing subsidies on the production side as "low-hanging fruit" for governments if they are serious about dealing with climate change.

"It's going to oil and coal companies that don't need it in the first place," he said.

___

Associated Press writers Abdullah Rebhy in Doha, Qatar, and Brian Murphy in Dubai, United Arab Emirates, contributed to this report

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Karl Ritter can be reached at www.twitter.com/karl_ritter

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