Democrats push for tax cuts they once opposed

Democrats seeking a deal to avert the year-end “fiscal cliff” are trying to etch into stone the signature economic achievement of Republican President George W. Bush by permanently extending tax cuts enacted during his tenure.

President Obama has put the extension of the tax cuts for most Americans at the top of his domestic agenda, a remarkable turnaround for Democrats, who had staunchly opposed the tax breaks when they were written into law about a decade ago.

With Obama leaving his Hawaii vacation for Washington on Wednesday and lawmakers returning Thursday, the main dividing line between Republicans and Democrats has come down to whether tax rates should increase for top earners at the end of the year, when the Bush-era tax cuts are set to expire. While Republicans want to extend all the cuts, Democrats are pushing to maintain lower rates on household income below $250,000. Those lower rates significantly reduce the taxes of nearly all American households that earn less than $250,000 — and many who earn more, even if tax rates are allowed to increase on income above that figure.

While it is increasingly unlikely that the two parties will reach an agreement to avoid the fiscal cliff before Jan. 1, it is all but certain that their ultimate deal, whenever it comes, will make permanent the lower rates for most Americans.

R. Glenn Hubbard, dean of the Columbia Business School and an architect of the Bush tax cuts, said it is “deeply ironic” for Democrats to favor extending most of them, given what he called their “visceral” opposition a decade ago. Keeping the lower rates even for income under $250,000 “would enshrine the vast bulk of the Bush tax cuts,” he said.

Democrats say they have reconsidered their opposition to the Bush tax cuts for several reasons. The cuts were written into law from 2001 to 2003 after a decade in which most Americans saw robust income growth. Over the past decade, by contrast, median wages have declined, after adjusting for inflation, amid a weak economy. Allowing tax cuts for the middle class to expire would further reduce take-home pay.

“We’ve had these tax cuts in place since 2001. The world changes, and the economy is where it is,” said Steven Elmendorf, who was chief of staff to former House minority leader Richard A. Gephardt (D-Mo.), a primary opponent of the Bush tax cuts. “With people’s economic status, we should not be raising taxes on people earning under $250,000.”

What’s more, income inequality has been growing. Sparing the middle class higher taxes while requiring the wealthy to pay more would tip the scales slightly in the other direction.

“The reason there’s been this movement toward broad consensus on renewing the tax cut for working- and middle-class families is that will give us a sharper progressivity in the tax system that is very much desired by Democrats and progressives who’ve seen an income distribution more and more distorted toward the wealthy,” said Betsey Stevenson, former chief economist in Obama’s Labor Department and a professor at the University of Michigan, who added that taxes may have to rise even more than currently contemplated to meet the country’s needs.

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Thousands flee Malaysia floods

KUALA LUMPUR: Floods triggered by torrential monsoon rains in Malaysia forced almost 14,000 people to flee their homes and seek shelter at relief centres, the official Bernama news agency said.

Rain showers which coincided with high tide flooded hundreds of homes in three northeastern states -- Terengganu, Pahang and Kelantan -- with some 13,746 people being housed at evacuation centres, it said amid forecasts of more rain.

Bernama said the flood situation was deteriorating as the number of evacuees continued to rise and some major roads in Pahang were closed as rivers burst their banks.

Muhammad Helmi Abdullah, the meteorological department's weather forecast director, warned that there could be more rain in Terengganu, Pahang and southern Johor state in the next few days.

"We expect intermittent rain to heavy showers in (some parts of) the states," he told AFP.

Muhammad Helmi said the northeast monsoon season would last until March and the affected states could experience at least three more "heavy rain" episodes.

Meanwhile a 36-year-old woman drowned after she slipped and fell into a rain-swollen river in Terengganu state on Tuesday while fishing in a water-logged area, Bernama said.

- AFP/ck

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Narendra Modi begins 4th innings as Gujarat CM

AHMEDABAD: Narendra Modi took oath as the chief minister of Gujarat for the fourth time at the Sardar Patel Stadium here on Wednesday.

Governor Kamala Beniwal administered the oath of office and secrecy to Modi.

BJP top brass including LK Advani, Nitin Gadkari, Arun Jaitley, Sushma Swaraj, Rajnath Singh, Venkaiah Naidu, Ananth Kumar, Ravi Shankar Prasad, Madhya Pradesh chief minister Shivraj Singh Chauhan attended the swearing-in ceremony. Former Rajasthan chief minister Vasundhra Raje, Shahnawaz Hussain, Mukhtar Abbas Naqvi, Anurag Thakur, Smriti Irani, Prakash Javadekar and Navjot Singh Sidhu were also present to witness Modi's crowning moment.

Tamil Nadu chief minister J Jayalalithaa, Punjab CM Parkash Singh Badal, Maharashtra Navnirman Sena chief Raj Thackeray, Indian National Lok Dal leader Om Prakash Chautala and Shiv Sena chief Uddhav Thackeray also attended the ceremony.

A host of other non-political faces, including Bollywood actor Vivek Oberoi, his father Suresh Oberoi and actor Kirron Kher also attended the swearing-in ceremony.

Narendra Modi led the BJP to a comprehensive win in the assembly elections winning 115 of the 182 seats. The Congress emerged victorious in 61 seats. The Gujarat Parivartan Party (GPP) of former chief minister Keshubhai Patel could bag only two seats.

(With inputs from ANI)

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Photos: Humboldt Squid Have a Bad Day at the Beach

Photograph by Chris Elmenhurst, Surf the Spot Photography

“Strandings have been taking place with increased frequency along the west coast over the past ten years,” noted NOAA’s Field, “as this population of squid seems to be expanding its range—likely a consequence of climate change—and can be very abundant at times.” (Learn about other jumbo squid strandings.)

Humboldt squid are typically found in warmer waters farther south in theGulf of California (map) and off the coast ofPeru. “[But] we find them up north here during warmer water time periods,” said ocean sciences researcherKenneth Bruland with the University of California, Santa Cruz (UCSC).

Coastal upwelling—when winds blowing south drive ocean circulation to bring cold, nutrient-rich waters up from the deep—ceases during the fall and winter and warmer water is found closer to shore. Bruland noted that climate change, and the resulting areas of low oxygen, “could be a major factor” in drawing jumbo squid north.

Published December 24, 2012

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Christmas Tornadoes Tear Across South

A nasty Christmastime storm system spawned blizzard conditions in some states and at least 15 reported tornadoes in the South, damaging homes, taking out power lines and dangerously snarling holiday travel.

Severe weather swept across the United States during the Christmas holiday, bringing tornadoes and intense thunderstorms to the Gulf Coast, while dumping heavy snow and freezing rain on the Southern Plains.

At least 15 tornadoes were reported today from Texas to Alabama, putting this storm system potentially on track to be one of the largest Christmas day tornado outbreaks on record.

One large tornado was reported in Mobile, Ala., where there are about 19,000 customers without power and 23,429 statewide, according to Alabama Power. Kerry Burns, a Mobile resident originally from Boston, said the storm "sounded like a freight train."

Some buildings in the area, including some churches and a local high school, were reportedly damaged. Ray Uballe, another Mobile resident, said his dad was shaken up.

"He was in his apartment," Uballe said. "He said it sounded like an airplane and then the door flung open and then there was just debris flying."

Douglas Mark Nix, president of the Infirmary Health System, said one of their Mobile hospitals lost power and sustained damage. There were no early reports of injuries to staff or patients.

"We are operating now on generator power," he said. "We do not have substantial damage but we do have a number of windows out and we have some ceiling tiles down, throughout the facility at the main hospital.

"We can run for at least two weeks but I saw power crews out all over the city so I fully expect power to be restored within the next day or so," Nix added.

Melinda Martinez/The Daily Town Talk/AP Photo

Winter Weather Causes Holiday Travel Problems Watch Video

At least eight states were issued blizzard warnings today, as the storms made highways dangerously slick heading into one of the busiest travel days of the year.

Oklahoma got about 7 inches of snow all over the state making for treacherous road conditions. ABC News affiliate KOCO-TV in Oklahoma City said the weather was being blamed for a 21-vehicle wreck on Interstate 40, but no one was seriously injured.

Ice accumulation in Arkansas bent trees and power lines, leaving at least 50,000 customers across the state without power. About 10 inches of snow fell on Fayetteville, Ark.

The storms, which first wreaked havoc on the West Coast before moving east, are being blamed for at least one death in Texas.

Investigators in the Houston area told ABC state KTRK-TV in Houston that a young man was trying to move a downed tree that was blocking the roadway when another one snapped and fell on top of him. He was later pronounced dead at a hopsital.

The last time a number of tornadoes hit the Gulf Coast area around Christmas Day was in 2009, when 22 tornadoes struck on Christmas Eve morning, National Weather Service spokesman Chris Vaccaro told ABC News over email.

The deadliest Christmastime tornado outbreak on record was Dec. 24 to 26, 1982, when 29 tornadoes in Oklahoma, Missouri, Arkansas, Tennessee and Mississippi killed three people and injured 32.

The last killer tornado around Christmas, Vaccaro said, was a Christmas Eve EF4 in Tennessee in 1988, which killed one person and injured seven. EF4 tornadoes can produce winds up to 200 mph.

No official word yet on the strength of the string of tornadoes reported today.

While some were preparing for a Christmas feast, others were hunkered down.

More than 180 flights nationwide were canceled by midday, according to the flight tracker FlightAware.com. More than half were canceled by American Airlines and its regional affiliate, American Eagle.

The storm system is expected to continue east into Georgia and the Carolinas Wednesday and could potentially spawn more tornadoes, according to the National Weather Service.

ABC News' Matt Gutman, Max Golembo and ABC News Radio contributed to this report.

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Federal workers feel unease over potential layoffs, furloughs unleashed by ‘fiscal cliff’

Federal employees have been skeptical for months that the biggest cuts to government spending in history could really happen. But with the “fiscal cliff” a week away, workers are now growing increasingly alarmed that their jobs and their missions could be on the line.

President Obama and members of Congress headed out of town late last week for a Christmas break without reaching a deal to avoid $110 billion in automatic across-the-board spending cuts, which would hamstring operations ranging from weather forecasting and air traffic control to the purchase of spare parts for weapons systems. So civil servants are bracing for the blow, wondering whether their work will be upended — and whether they may be forced to take unpaid days off.

“This could change day by day,” said Antonio Webb, 25, who works in the mail service that handles correspondence for the Department of Homeland Security. “You could come into work and the next day they say, ‘We don’t need you because we have to cut so much.’ ”

Many federal workers have become jaded after a two-year pay freeze and congressional fights over spending that keep agencies lurching from one stopgap budget to another. Until recently, few employees thought it could come to this: Budget cuts of 8 to 10 percent divided equally between military and domestic agencies. Only a few programs, like Social Security, veterans benefits and some services for the poor, are exempted.

“Sure, we continue to do our jobs,” said Carl Eichenwald, who works in enforcement at the Environmental Protection Agency. “But all of this uncertainty is disruptive for our mission. A lot of time gets spent spinning wheels. We won’t know whether we can do inspections. Do we have 100 percent of our budget, or 85 percent?”

Top congressional aides said Monday that discussions of how to avert the fiscal cliff had come to a virtual standstill. Obama and House Speaker John A. Boehner (R-Ohio) had not spoken since Friday.

Each side in the negotiations urged the other to come up with a way around the impasse. A senior Democratic aide said Boehner needs to return from the holiday with a “cleared head and a readiness to deal.” The aide said that there is no time for Democrats to unilaterally advance a bill in the Senate, adding that they can press forward with legislation only if they are assured by Republican leaders of GOP support.

A senior Senate Republican aide insisted, however, that it is now up to Senate Majority Leader Harry M. Reid (Nev.) and his fellow Democrats to figure out what they can pass in the Senate without worrying about the Republican-controlled House.

As the year-end deadline approaches, federal employees have been told very little by their bosses about how their agencies are preparing to carry out huge spending reductions.

“It seemed like we were almost immune to thinking that something real was going to come of it,” said Fernando Cutz, an analyst for the U.S. Agency for International Development.

Then came an e-mailed memo on Thursday from agency heads to employees. The cuts would be “significant and harmful to our collective mission.” Furloughs “or other personnel actions” — layoffs — remain a real possibility.

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7 dead, thousands homeless in Manila fires

MANILA: At least seven people were killed and thousands left homeless as two fires struck the Philippine capital on Christmas Day, sparking riots as a slum went up in flames, Manila's fire marshal said Tuesday.

Six bodies were recovered and two other people were missing as a blaze erupted at dawn in a row of old apartments in the Baler section of northern Manila, said Chief Superintendent Santiago Laguna.

Suspected arsonists meanwhile set off a second blaze at a sprawling shantytown across the city, sparking rioting that left one man dead and two others arrested, he said in an interview that aired over DZBB radio.

"They (residents) started grabbing hoses from our firefighters, who could not do anything as they feared for their own safety," Laguna said.

A man was beaten up and later died from his injuries in the melee as the blaze consumed the shantytown in the San Juan district, he added.

"They mistook him for a fireman," he said of the victim, adding two suspected rioters were also arrested.

Laguna said residents were apparently infuriated by the delayed arrival of firefighters and took it upon themselves to grab firehoses to aim at their blazing shanties.

However he said the residents were themselves to blame.

"Our firetrucks had difficulty entering the narrow streets that were blocked by parked cars and carts," he said.

"Our firefighters had to drag the hoses into the alleys, where they were attacked."

The shantytown blaze left some 2,000 families homeless, he said, a figure that equates to at least 8,000 people.

An AFP photographer on the scene saw hundreds of homeless survivors huddled on the floor of two basketball courts nearby.

Laguna said the cause of the apartment blaze was under investigation, though he added electrical circuits had probably overloaded from increased use during Christmas Eve parties across the metropolis of 14 million people.

- AFP/ck

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Fog hits about 40 flight schedules in Delhi

NEW DELHI: Schedules of around 40 flights were hit on Tuesday as dense fog enveloped the Indira Gandhi International Airport here for the third consecutive day, causing inconvenience to passengers.

As many as 29 domestic and international flights were delayed by half-an-hour to five hours and 10 were cancelled, airport sources said.

Fog started descending at the airport around 10pm on Monday but the runway visibility was fine and flight operations were not affected then.

But the situation started to deteriorate around 11.21pm when visibility dropped to 50 metres on the third runway (29/11). However, the visibility was around 800 metres on the main runway (28/10) and, therefore, flight operations went on unhindered on it, the sources said.

Fog became more dense around 12.30am, when the visibility on the main runway also dropped to 50 metres while that on the third runway was below 50 metres, which brought the flight operations to a standstill, though it was not busy flight schedule period at that time.

The visibility started to increase after 1.30am on the main runway and flights began taking off as and when the conditions were right, they said.

The visibility at one end of the third runway remained zero till almost 5.30am, they said.

On Monday, around 140 flights were affected due to dense fog.

Meanwhile, Delhi experienced the winter chill as the minimum temperature dropped to seven degrees Celsius.

The weather office has predicted a foggy morning but a clear sky in later part of the day.

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Photos: Humboldt Squid Have a Bad Day at the Beach

Photograph by Chris Elmenhurst, Surf the Spot Photography

“Strandings have been taking place with increased frequency along the west coast over the past ten years,” noted NOAA’s Field, “as this population of squid seems to be expanding its range—likely a consequence of climate change—and can be very abundant at times.” (Learn about other jumbo squid strandings.)

Humboldt squid are typically found in warmer waters farther south in theGulf of California (map) and off the coast ofPeru. “[But] we find them up north here during warmer water time periods,” said ocean sciences researcherKenneth Bruland with the University of California, Santa Cruz (UCSC).

Coastal upwelling—when winds blowing south drive ocean circulation to bring cold, nutrient-rich waters up from the deep—ceases during the fall and winter and warmer water is found closer to shore. Bruland noted that climate change, and the resulting areas of low oxygen, “could be a major factor” in drawing jumbo squid north.

Published December 24, 2012

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Newtown Christmas: 'We Know They'll Feel Loved'

People drawn to Newtown to share in its mourning brought cards and handmade snowflakes to town Monday while residents prepared to observe Christmas less than two weeks after a gunman killed 20 children and six educators at an elementary school.

On Christmas Eve, residents said they would light luminaries outside their homes in memory of the victims. Tiny empty Christmas stockings with the victims' names on them hung from trees in the neighborhood where the children were shot.

"We know that they'll feel loved. They'll feel that somebody actually cares," said Treyvon Smalls, a 15-year-old from a few towns away who arrived at town hall with hundreds of cards and paper snowflakes collected from around the state.

Organizers said they wanted to let the families of victims know they are not alone while also giving Connecticut children a chance to express their feelings about the shootings at Sandy Hook Elementary School.

At the Trinity Episcopal Church, less than 2 miles from the school, an overflow crowd of several hundred people attended Christmas Eve services. They were greeted by the sounds of a children's choir echoing throughout a sanctuary hall that had its walls decorated with green wreaths adorned with red bows.

The church program said flowers were donated in honor of Sandy Hook shooting victims, identified by name or as the "school angels" and "Sandy Hook families."

Julio Cortez, File/AP Photo

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The service, which generally took on a celebratory tone, made only a few vague references to the shooting. Pastor Kathie Adams-Shepherd led the congregation in praying "that the joy and consolation of the wonderful counselor might enliven all who are touched by illness, danger, or grief, especially all those families affected by the shootings in Sandy Hook."

Police say the gunman killed his mother in her bed before his Dec. 14 rampage and committed suicide as he heard officers arriving. Authorities have yet to give a theory about his motive.

While the grief is still fresh, some residents are urging political activism in the wake of the tragedy. A grassroots group called Newtown United has been meeting at the library to talk about issues ranging from gun control, to increasing mental health services to the types of memorials that could be erected for the victims. Some clergy members have said they also intend to push for change.

"We seek not to be the town of tragedy," said Rabbi Shaul Praver of Congregation Adath Israel. "But, we seek to be the town where all the great changes started."

Since the shooting, messages similar to the ones delivered Monday have arrived from around the world. People have donated toys, books, money and more. A United Way fund, one of many, has collected $3 million. People have given nearly $500,000 to a memorial scholarship fund at the University of Connecticut. On Christmas Day, police from other towns have agreed to work so Newtown officers can have the time off.

In the center of Newtown's Sandy Hook section Monday, a steady stream of residents and out-of-towners snapped pictures, lit candles and dropped off children's gifts at an expansive memorial filled with stuffed animals, poems, flowers, posters and cards.

"All the families who lost those little kids, Christmas will never be the same," said Philippe Poncet, a Newtown resident originally from France. "Everybody across the world is trying to share the tragedy with our community here."

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