DA investigating Texas' troubled $3B cancer agency

AUSTIN, Texas (AP) — Turmoil surrounding an unprecedented $3 billion cancer-fighting effort in Texas worsened Tuesday when its executive director offered his resignation and the state's chief public corruption prosecutor announced an investigation into the beleaguered agency.

No specific criminal allegations are driving the latest probe into the Cancer Prevention and Research Institute of Texas, said Gregg Cox, director of the Travis County district attorney's public integrity unit. But his influential office opened a case only weeks after the embattled agency disclosed that an $11 million grant to a private company bypassed review.

That award is the latest trouble in a tumultuous year for CPRIT, which controls the nation's second-largest pot of cancer research dollars. Amid the mounting problems, the agency announced Tuesday that Executive Director Bill Gimson had submitted his letter of resignation.

"Unfortunately, I have also been placed in a situation where I feel I can no longer be effective," Gimson wrote in a letter dated Monday.

Gimson said the troubles have resulted in "wasted efforts expended in low value activities" at the agency, instead of a focused fight against cancer. Gimson offered to stay on until January, and the agency's board must still approve his request to step down.

His departure would complete a remarkable house-cleaning at CPRIT in a span of just eight months. It began in May, when Dr. Alfred Gilman resigned as chief science officer in protest over a different grant that the Nobel laureate wanted approved by a panel of scientists. He warned it would be "the bomb that destroys CPRIT."

Gilman was followed by Chief Commercialization Officer Jerry Cobbs, whose resignation in November came after an internal audit showed Cobbs included an $11 million proposal in a funding slate without a required outside review of the project's merits. The lucrative grant was given to Dallas-based Peloton Therapeutics, a biomedical startup.

Gimson chalked up Peloton's award to an honest mistake and has said that, to his knowledge, no one associated with CPRIT stood to benefit financially from the company receiving the taxpayer funds. That hasn't satisfied some members of the agency's governing board, who called last week for more assurances that no one personally profited.

Cox said he has been following the agency's problems and his office received a number of concerned phone calls. His department in Austin is charged with prosecuting crimes related to government officials; his most famous cases include winning a conviction against former U.S. House Majority Leader Tom DeLay in 2010 on money laundering charges.

"We have to gather the facts and figure what, if any, crime occurred so that (the investigation) can be focused more," Cox said.

Gimson's resignation letter was dated the same day the Texas attorney general's office also announced its investigation of the agency. Cox said his department would work cooperatively with state investigators, but he made clear the probes would be separate.

Peloton's award marks the second time this year that a lucrative taxpayer-funded grant authorized by CPRIT instigated backlash and raised questions about oversight. The first involved the $20 million grant to M.D. Anderson Cancer Center in Houston that Gilman described as a thin proposal that should have first been scrutinized by an outside panel of scientific peer-reviewers, even though none was required under the agency's rules.

Dozens of the nation's top scientists agreed. They resigned en masse from the agency's peer-review panels along with Gilman. Some accused the agency of "hucksterism" and charting a politically-driven path that was putting commercial product-development above science.

The latest shake-up at CPRIT caught Gilman's successor off-guard. Dr. Margaret Kripke, who was introduced to reporters Tuesday, acknowledged that she wasn't even sure who she would be answering to now that Gimson was stepping down. She said that although she wasn't with the agency when her predecessor announced his resignation, she was aware of the concerns and allegations.

"I don't think people would resign frivolously, so there must be some substance to those concerns," Kripke said.

Kripke also acknowledged the challenge of restocking the peer-review panels after the agency's credibility was so publicly smeared by some of the country's top scientists. She said she took the job because she felt the agency's mission and potential was too important to lose.

Only the National Institutes of Health doles out more cancer research dollars than CPRIT, which has awarded more than $700 million so far.

Gov. Rick Perry told reporters in Houston on Tuesday that he wasn't previously aware of the resignation but said Gimson's decision to step down was his own.

Joining the mounting criticism of CPRIT is the woman credited with brainstorming the idea for the agency in the first place. Cathy Bonner, who served under former Texas Gov. Ann Richards, teamed with cancer survivor Lance Armstrong in selling Texas voters in 2007 on a constitutional amendment to create an unprecedented state-run effort to finance a war on disease.

Now Bonner says politics have sullied an agency that she said was built to fund research, not subsidize private companies.

"There appears to be a cover-up going on," Bonner said.

Peloton has declined comment about its award and has referred questions to CPRIT. The agency has said the company wasn't aware that its application was never scrutinized by an outside panel, as required under agency rules.

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Follow Paul J. Weber on Twitter: www.twitter.com/pauljweber

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Asian shares rise, Fed outcome pressures dollar

TOKYO (Reuters) - Asian shares rose on Wednesday buoyed by strength in global equities markets, firmer economic sentiment in Germany and hopes of a deal from U.S. budget talks, while the dollar came under pressure ahead of the Federal Reserve's policy decision.

MSCI's broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> gained 0.5 percent to a 16-month peak. The index has hit successive 16-month highs since December 5.

Australian shares <.axjo> were up 0.4 after touching a nearly 17-month high on the back of Wall Street gains and higher iron ore prices.

"Definitely the momentum is to the upside," said Stan Shamu, a market analyst at IG Markets. "Everyone seems to be pricing in a fairly positive outcome to the fiscal cliff negotiations as well."

South Korean shares <.ks11> inched up 0.2 percent, shrugging off news of North Korea's rocket launch, but profit-taking on large caps limited gains.

"North Korea is no longer an economic match for the South, so, short of a full-scale conflict, the North's actions will have little impact on the KOSPI," Im No-jung, chief economist at IM Investment & Securities, said of the Seoul stock market.

North Korea launched the second rocket this year on Wednesday just before 10 a.m. and may have finally succeeded in putting a satellite into space, the stated aim of what critics say is a disguised ballistic missile test.

Japan's Nikkei share average <.n225> rose 0.5 percent after hitting a 7-1/2-month high earlier, led by gains in tech shares and other exporters on the weak yen. <.t/>

The dollar remained broadly under pressure on expectations the Fed will take further monetary easing step, pushing the currency down to a three-month low against the Australian dollar. The euro popped back above $1.3000, pulling away from a two-week low of $1.2876 plumbed Friday.

The Fed is expected to announce it will buy $45 billion per month of longer-dated Treasuries beginning in January on top of the $40 billion in mortgage-backed security purchases it announced in September. The new buying will replace the Fed's current program, Operation Twist, which expires at the end of December.

"Although the view that the Fed will shift to outright Treasury purchases is now very widely shared by market participants, we do not believe it has been fully reflected into markets or in positioning," said Vassili Serebriakov, a strategist at BNP Paribas.

"Accordingly, dollar weakness is highly likely should the Fed shift to outright U.S. Treasury purchases."

Against the yen, the dollar steadied at 82.54 yen. The Japanese currency has also been pressured by expectations for more easing from the Bank of Japan, which meets next week.

Data on Wednesday showed Japan's core machinery orders rose 2.6 percent in October from the previous month, up for the first time in three months but below a 3 percent rise forecast, highlighting how uncertainty over the global outlook continued to weigh on business investment and the broader economy.

Investors also closely followed developments in U.S. budget talks to avert the "fiscal cliff," some $600 billion of tax hikes and spending cuts scheduled to start in January, which economists have warned could send the U.S. economy into recession and drag down the fragile global economy.

Negotiations to avert the "fiscal cliff" ahead of a year-end deadline intensified as President Barack Obama and U.S. House of Representatives Speaker John Boehner spoke by phone on Tuesday after exchanging new proposals, in a possible sign of progress ahead of the end-of-year deadline.

A group of high-profile chief executives urged President Barack Obama and Republican congressional leaders on Tuesday to strike a deal, reflecting mounting urgency to resolve the issue with time running out.

U.S. crude futures inched up 0.2 percent to $85.96 a barrel and Brent rose 0.3 percent to $108.37.

(Additional reporting by Maggie Lu Yueyang in Canberra, Somang Yang and Joyce Lee in Seoul and Ian Chua in Sydney; Editing by Jacqueline Wong)

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Panasonic may sell Sanyo digital camera business: source

TOKYO (Reuters) – Panasonic Corp may sell its Sanyo digital camera business to Japanese private equity fund Advantage Partners by the end of March, a source familiar with the plan said.

A final decision on the sale will be made by the end of the year, the source said on condition he was not identified.

Advantage Partners will pay several hundreds of millions of yen for the business, which makes digital cameras for other companies, including Olympus Corp, the Nikkei business daily reported earlier.

Panasonic declined to comment saying it had not announced the plan.

The Japanese company aims to sell 110 billion yen ($ 1.34 billion) of assets, including buildings and land by the end of March to boost free cashflow to 200 billion yen for the business year. The company expects an annual net loss of close to $ 10 billion as it writes off billions in deferred tax assets and goodwill.

Panasonic acquired rival Sanyo, a leading maker of lithium ion batteries and solar panels, in 2010. Sales of compact digital cameras are under pressure from increasingly powerful smartphones.

Panasonic’s shares gained as much as 4 percent in early trading in Tokyo, compared with a 0.5 percent rise in the benchmark Nikkei 225 index. ($ 1 = 82.3900 Japanese yen)

(Reporting by Reiji Murai; Writing by Tim Kelly; Editing by Jeremy Laurence)

Gadgets News Headlines – Yahoo! News

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Hayden Panettiere Splits with Scotty McKnight

12/10/2012 at 07:50 PM EST

Hayden Panettiere and Scotty McKnight

Splash News Online

Is there a tear in her beer?

Nashville star Hayden Panettiere has broken up with her boyfriend of more than a year, New York Jets wide receiver Scotty McKnight, a source confirms to PEOPLE.

But the split doesn't appear to be the stuff of a sad country song. The actress, 23, is still friends with McKnight, 24, and one source tells TMZ that their pals wouldn't be surprised if they got back together.

This is Panettiere's second go at a relationship with an athlete. Before dating McKnight she was with Ukrainian boxer Wladimir Klitschko for about two years.
– Julie Jordan

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Surprise: New insurance fee in health overhaul law

WASHINGTON (AP) — Your medical plan is facing an unexpected expense, so you probably are, too. It's a new, $63-per-head fee to cushion the cost of covering people with pre-existing conditions under President Barack Obama's health care overhaul.

The charge, buried in a recent regulation, works out to tens of millions of dollars for the largest companies, employers say. Most of that is likely to be passed on to workers.

Employee benefits lawyer Chantel Sheaks calls it a "sleeper issue" with significant financial consequences, particularly for large employers.

"Especially at a time when we are facing economic uncertainty, (companies will) be hit with a multi-million dollar assessment without getting anything back for it," said Sheaks, a principal at Buck Consultants, a Xerox subsidiary.

Based on figures provided in the regulation, employer and individual health plans covering an estimated 190 million Americans could owe the per-person fee.

The Obama administration says it is a temporary assessment levied for three years starting in 2014, designed to raise $25 billion. It starts at $63 and then declines.

Most of the money will go into a fund administered by the Health and Human Services Department. It will be used to cushion health insurance companies from the initial hard-to-predict costs of covering uninsured people with medical problems. Under the law, insurers will be forbidden from turning away the sick as of Jan. 1, 2014.

The program "is intended to help millions of Americans purchase affordable health insurance, reduce unreimbursed usage of hospital and other medical facilities by the uninsured and thereby lower medical expenses and premiums for all," the Obama administration says in the regulation. An accompanying media fact sheet issued Nov. 30 referred to "contributions" without detailing the total cost and scope of the program.

Of the total pot, $5 billion will go directly to the U.S. Treasury, apparently to offset the cost of shoring up employer-sponsored coverage for early retirees.

The $25 billion fee is part of a bigger package of taxes and fees to finance Obama's expansion of coverage to the uninsured. It all comes to about $700 billion over 10 years, and includes higher Medicare taxes effective this Jan. 1 on individuals making more than $200,000 per year or couples making more than $250,000. People above those threshold amounts also face an additional 3.8 percent tax on their investment income.

But the insurance fee had been overlooked as employers focused on other costs in the law, including fines for medium and large firms that don't provide coverage.

"This kind of came out of the blue and was a surprisingly large amount," said Gretchen Young, senior vice president for health policy at the ERISA Industry Committee, a group that represents large employers on benefits issues.

Word started getting out in the spring, said Young, but hard cost estimates surfaced only recently with the new regulation. It set the per capita rate at $5.25 per month, which works out to $63 a year.

America's Health Insurance Plans, the major industry trade group for health insurers, says the fund is an important program that will help stabilize the market and mitigate cost increases for consumers as the changes in Obama's law take effect.

But employers already offering coverage to their workers don't see why they have to pony up for the stabilization fund, which mainly helps the individual insurance market. The redistribution puts the biggest companies on the hook for tens of millions of dollars.

"It just adds on to everything else that is expected to increase health care costs," said economist Paul Fronstin of the nonprofit Employee Benefit Research Institute.

The fee will be assessed on all "major medical" insurance plans, including those provided by employers and those purchased individually by consumers. Large employers will owe the fee directly. That's because major companies usually pay upfront for most of the health care costs of their employees. It may not be apparent to workers, but the insurance company they deal with is basically an agent administering the plan for their employer.

The fee will total $12 billion in 2014, $8 billion in 2015 and $5 billion in 2016. That means the per-head assessment would be smaller each year, around $40 in 2015 instead of $63.

It will phase out completely in 2017 — unless Congress, with lawmakers searching everywhere for revenue to reduce federal deficits — decides to extend it.

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Asian shares edge up; Fed move, fiscal cliff in focus

TOKYO (Reuters) - Asian shares edged higher while the euro steadied on Tuesday, but prices were capped as investors waited for the U.S. Federal Reserve's policy decision later this week and any progress in U.S. budget talks.

MSCI's broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> nudged up 0.2 percent. The index has hit successive 16-month highs for the past four sessions.

Australian shares <.axjo> gained 0.4 percent to their highest in nearly two months on a strong resources sector, which was supported by a rise in metals and oil prices and hopes for the Fed to further ease monetary policy.

Hong Kong shares <.hsi> rose 0.4 percent to a 16-month high but Shanghai shares <.ssec> fell 0.5 percent.

"The market continues to trade sideways in an environment where headlines seem to have lost bite. Poor liquidity conditions as we approach the end of the year seem to keep portfolios on a tight leash around their benchmarks," said Barclays Capital analysts in a research note.

Japan's Nikkei share average <.n225> was the region's other laggard, slipping 0.3 percent to around 9,506 as investors became cautious over signs that the market is overbought after a 10 percent rally in the past month and took profit on export-focused firms. <.t/>

"The 9,500-level is still an important psychological line for both support and resistance purposes," said Yutaka Miura, a senior technical analyst at Mizuho Securities.

U.S. Treasury prices edged higher on Monday on worries about U.S. budget wrangling, Italy's political rumbling and expectations of further monetary easing by the Fed.

At the end of the two-day meeting which begins on Tuesday, the Fed is expected to announce it will buy $45 billion per month of longer-dated Treasuries beginning in January to replace the current Operation Twist program, which expires at the end of December.

Under the program, it sells shorter-dated U.S. government debt and buys longer-dated Treasuries to extend the duration of its balance sheet.

Such views weighed on the dollar and helped to underpin the euro, which traded at $1.2937, off Monday's low of $1.2880.

The dollar firmed 0.1 percent to 82.40 yen as the yen has also been pressured by expectations for more easing from the Bank of Japan, which meets next week.

The euro was also supported as Italian Prime Minister Mario Monti played down market fears over his decision to resign, saying there was no danger of a vacuum ahead of an election in the spring.

"I think people at this point are not sure whether there really will be the risk of Italy not pursuing its fiscal reforms pursued under Monti. So it's hard to really price that news in yet," said Takao Hattori, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities in Tokyo.

FISCAL WORRIES

European partners urged the next Italian government on Monday to stick to Monti's reform agenda, after his decision to resign early and Silvio Berlusconi's return to frontline politics rattled financial markets.

Monti had earned market confidence over the past year in indebted Italy, as he spearheaded a reform agenda to rescue the euro zone's third-largest economy from the threat of a Greek-style collapse.

His earlier-than-expected departure raised concerns about the prospects for Italy's fiscal reforms, lifting Italy's benchmark 10-year bond yield up to 4.83 percent, the highest in more than three weeks, while driving Italian shares <.ftmib> down more than 2 percent.

Investors also worry about the impact on neighboring Spain, which is struggling with high debt and studying the need for outside help.

Fiscal worries in the United States have also weighed on investor sentiment, limiting their activity as trading winds down towards the year-end holiday season.

Economists have warned that a failure by Congress to avert the "fiscal cliff," some $600 billion of tax hikes and spending cuts scheduled to start in January, could send the U.S. economy back into recession, further weighing on the fragile global economy.

The White House and House of Representatives Speaker John Boehner's office held more negotiations on Monday on ways to break the budget stalemate, but neither side showed any public signs that they were ready to give ground. The talks picked up pace after Boehner met with President Barack Obama on Sunday, raising hopes of progress.

U.S. crude futures were little changed at $85.56 a barrel and Brent eased 0.1 percent to $107.28.

Trading was subdued in Asian credit markets, with the slight rise in stocks helping to narrow the spreads on the iTraxx Asia ex-Japan investment-grade index marginally by 1 basis point.

(Additional reporting by Ayai Tomisawa in Tokyo; Editing by Jacqueline Wong)

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Afghan Army Still Needs Support, Pentagon Says

WASHINGTON — As President Obama considers how quickly to withdraw the remaining 68,000 American troops in Afghanistan and turn over the war to Afghan security forces, a bleak new Pentagon report has found that only one of the Afghan National Army’s 23 brigades is able to operate independently without air or other military support from the United States and NATO partners.

The report, released Monday, also found that violence in Afghanistan is higher than it was before the surge of American forces into the country two years ago, although it is down from a high in the summer of 2010.

The assessment found that the Taliban remain resilient, that widespread corruption continues to weaken the central Afghan government and that Pakistan persists in providing critical support to the insurgency. Insider attacks by Afghan security forces on their NATO coalition partners, while still small, are up significantly: there have been 37 so far in 2012, compared with 2 in 2007.

As bright spots the report identified the continued transition by Afghan security forces into taking the lead on most routine patrols throughout the country and a decline in violence in populated areas like Kabul, the Afghan capital, and Kandahar, the largest city in the south.

The assessment, “Report on Progress Toward Security and Stability in Afghanistan,” is required twice a year by Congress and covers the six-month period from April 1 through the end of September. Although the problems in the report have been familiar for years to national security officials in Washington, the report’s publication comes at an important juncture in the war.

American officials say that Gen. John R. Allen, the senior American commander in Afghanistan, wants to keep a large majority of the 68,000 troops in Afghanistan through the fighting season next fall so that Afghan forces have as much support as possible as they move out on their own by 2014. But military officials anticipate that the White House may push for a more rapid withdrawal to cut losses in an increasingly unpopular war.

More than 2,000 American service members have died in the war, which has cost the United States more than $500 billion since 2001. More than 1,200 American service members have died in Afghanistan from the beginning of 2010 to the present, which is roughly the period of the surge.

Obama administration officials have said that progress in the war in large part depends on whether the Taliban could rebuild after the hammering it took during the surge, when American forces, with 33,000 additional troops, aggressively pursued insurgents and drove them from critical territory in the south.

But the report was blunt in its assessment of the Taliban’s current strength. “The Taliban-led insurgency remains adaptive and determined, and retains the capability to emplace substantial numbers of I.E.D.s and to conduct isolated high-profile attacks,” the report said, using the term for homemade bombs. “The insurgency also retains a significant regenerative capacity.”

The report said that although the insurgents had less capability to directly attack American and Afghan forces, they had increasingly resorted to “assassinations, kidnappings, intimidation tactics, encouraging insider attacks and strategic messaging campaigns.”

A defense official who briefed reporters at the Pentagon sought to offer a more positive picture of the Afghan security forces’ abilities than the report would suggest. Acknowledging that the progress of the security forces had been “incremental,” the official said that many of the forces patrol and carry out some operations independently, without help from NATO. “They often don’t rely on any assistance from us at all,” said the official, who declined to be named under ground rules imposed by the Pentagon.

But the official said there were nonetheless broad problems with the Afghan National Army and the Afghan National Police, which together number 350,000 personnel. The security forces still depend over all on American air power, communications, intelligence gathering, logistics and leadership. That is true especially at the level of a brigade, which typically is composed of 3, 000 to 5,000 troops.

The official acknowledged that it would be a “challenge” to have the security forces ready to defend their own country by the end of 2014, when most American troops are to be out of Afghanistan. The White House is debating how many American forces should be left in the country after 2014 and it has opened negotiations with the Afghans on what their mission should be.

The defense official said that the rise in violence in Afghanistan — measured by what the report termed “enemy initiated attacks” — was a result of Afghan security forces pushing into Taliban-dominated areas, forcing the Taliban to fight back. The official cited three volatile districts in Kandahar Province — Maiwand, Panjwai and Zhari — as highly contested, violent areas.

Although the report did not provide month-by-month specific numbers of enemy-initiated attacks, it plotted them on a bar graph that showed, for example, that in July 2012 there were slightly more than 3,000 enemy-initiated attacks. In July 2009, before the surge began, the graph showed some 2,000 enemy-initiated attacks.

The official said it was a sign of progress that the report found that enemy-initiated attacks had declined in the city of Kandahar by 62 percent from a year ago.

The report found many problems with the Afghan government that American security officials have been aware of for years. The government, the report said, suffers from “widespread corruption, limited human capacity, lack of access to rural areas due to a lack of security, a lack of coordination between the central government and the Afghan provinces and districts, and an uneven distribution of power among the judicial, legislative and executive branches.”

One area of improvement, the report said, was the American relationship with Pakistan, which has been acrimonious in recent years. The report noted that the Pakistanis had agreed to reopen their country to trucks transporting matériel for the war in Afghanistan. However, the report said that “tensions remain” over insurgent sanctuaries in Pakistan and cross-border attacks.

The report had been due to be released in early November, before the presidential election, but was delayed. The Pentagon did not give a reason for the delay.

Michael R. Gordon contributed reporting.

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Google’s Gmail service suffers disruption

SAN FRANCISCO (Reuters) – Several Google Inc Web products, including the popular Gmail service, appeared to go dark for users on several continents on Monday.

Google confirmed that “service disruptions” had affected Gmail and Google Drive, its online storage service. The two products are part of Google’s Apps suite, a Microsoft Office rival that caters to both consumers and businesses.

By 10:10 a.m. Pacific Time (1.10 p.m. EST), Google’s Apps Dashboard monitoring service reported that Gmail and Drive service had resumed. The company did not specify how many users were affected, or where, but the outage prompted widespread complaints on social media on both coasts in the U.S. and other major markets, from the United Kingdom to Brazil.

Some users additionally reported that the outage had affected Google Docs, the company’s word-processing and spreadsheet programs, while Chrome, Google’s Internet browser, also crashed unexpectedly.

“We are currently experiencing an issue with some Google services,” Google spokeswoman Andrea Freund said in a statement. “For everyone who is affected, we apologize for any inconvenience you may be experiencing.”

Firmly entrenched in the consumer market, Gmail is one of Google’s most popular and important product offerings. The search giant, which has been pushing a corporate version of the email service and its Apps suite to businesses to compete with Microsoft, said this month that the package will no longer be free to business customers.

(Reporting By Gerry Shih; Editing by Andrew Hay and Nick Zieminski)

Tech News Headlines – Yahoo! News

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Tim McGraw and Faith Hill Kick Off Special Series of Las Vegas Shows

By Mark Gray

12/09/2012 at 05:00 PM EST

Tim McGraw and Faith Hill

Denise Truscello/WireImage

Tim McGraw and Faith Hill looked at each other, their hands on each others knees and shared a passionate kiss just after midnight Sunday morning.

The moment was a long time coming – it capped off their first weekend as a Las Vegas headlining act.

Earlier in the 90 minute show, McGraw told the crowd at the Venetian that he and his wife were going to "have fun tonight" and it genuinely seemed like they did, singing with each other for several songs while still letting the other perform their solo hits. Though the show – called the Soul2Soul series – is technically not the same "residency" show Las Vegas is known for, the couple will perform for 10 weekends through April.

At a press conference several months ago, McGraw and Hill promised a "personal" show, and they delivered in a big way. In fact, it got very personal as McGraw complimented his wife on her flowing black dress, saying, "It's gonna look good on the floor later."

The duo also took a moment to sit down and speak with the crowd. Though they didn't field any questions, they spoke about the most common questions they get asked. "We always get asked what was the music we heard first, who influenced us," Hill said.

Rather than answer it, the duo then sing a few of their main influences – Hill sang George Strait; McGraw sang The Eagles.

"I love doing other people's music, better than my own," McGraw joked.

With few bells and whistles, the show puts the focus squarely on it's two superstars, and considering the rousing ovations McGraw and Hill received Saturday, that's perfectly fine with their fans.

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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

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