NEWS,03.04.2013

Economist warns of radical climate change

The author of an influential 2006 study on climate change warned on Tuesday that the world could be headed toward warming even more catastrophic than expected but he voiced hope for political action. Nicholas Stern, the British former chief economist for the World Bank, said that both emissions of greenhouse gas and the effects of climate change were taking place faster than he forecast seven years ago.Without changes to emission trends, the planet has roughly a 50% chance that temperatures will soar to five degrees Celsius (nine degrees Fahrenheit) above pre-industrial averages in a century, he said."We haven't been above five degrees Centigrade on this planet for about 30 million years. So you can see that this is radical change way outside human experience," Stern said in an address at the International Monetary Fund."When we were at three degrees Centigrade three million years ago, the sea levels were about 20 some meters above now. On sea level rise of just two meters, probably a couple of hundred million people would have to move," he said.Stern said that other effects would come more quickly including the expansion of deserts and the melting of Himalayan snows that supply rivers on which up to two billion people depend.Even if nations fulfill pledges made in 2010 at a UN-led conference in Cancun, Mexico, the world would be on track to warming of four degrees (7.2 Fahrenheit), he said.Stern's 2006 study, considered a landmark in raising public attention on climate change, predicted that warming would shave at least five percent of gross domestic product per year.Despite the slow progress in international negotiations, Stern saw signs for hope as a number of countries move to put a price on greenhouse gases."My own view is that 2013 is the best possible year to try to work and redouble our efforts to create the political will that hitherto has been much too weak," Stern said.Stern said that French President Francois Hollande was keen for nations to meet their goal of sealing an accord in 2015 in Paris.Stern also voiced hope that German Chancellor Angela Merkel, long a prominent voice on climate change, would become more active after this year's elections.US President Barack Obama has vowed action on climate change after an earlier bid was thwarted by lawmakers of the rival Republican Party, many of whom reject the science behind climate change.Emissions have risen sharply in recent years from emerging economies, particularly China.

Minister vows to revive Cypriot economy

The new finance minister of cash-strapped Cyprus vowed on Wednesday to do "whatever it takes" to sort out the EU country's teetering finances and put the economy back on track for growth. Haris Georgiades was speaking hours after President Nicos Anastasiades swore him in, warning of "difficult days ahead" for an island struggling to recover from a near financial meltdown and the need for a crippling eurozone bailout.Anastasiades said this would entail "firstly, collectivity and, secondly, consistency and fiscal discipline and all those measures that will contribute to kick-starting the economy as soon as possible."The new minister, a 40-year-old British-educated economist, vowed to implement the terms of the bailout "fully... we shall meet all time frames and meet all targets"."We... shall do whatever it takes to fix our public finances and put our economy back on track for growth.""Even though today's circumstances might be bleak, the medium- and long-term prospects remain excellent. We have received a blow but I'm absolutely confident we shall overcome," said Georgiades.Under the terms of the bailout, Cyprus will drastically reduce the size of its bloated banking sector, raise taxes, downsize the public sector workforce and privatise some state-owned firms.Cyprus is already in recession, with unemployment at around 15% and expected to grow sharply this year and next.Forecasts before the deal was agreed saw GDP contracting by 3.5% this year.On Tuesday, outgoing finance minister Michalis Sarris said "2013 will be a very difficult year, and the beginning of 2014 will also be difficult. Beyond this I believe the prospects are positive".Georgiades, who became labour minister when Anastasiades was elected in February, was appointed after Sarris stepped down on Tuesday.Sarris had been chairperson last year of failed Laiki Bank, whose collapse was a major contributor to the crisis. He said he was resigning to cooperate with a panel of judges appointed to investigate the causes of the crisis.His departure came as the government wrapped up talks with the IMF, European Commission and European Central Bank that will open the way for Cyprus to receive a €10bn ($12.8bn) bailout.The deal will see Cyprus receiving the loan with an interest rate of between 2.5 and 2.7%, repayable over 12 years after a grace period of 10.On Wednesday, International Monetary Fund managing director Christine Lagarde said the IMF's contribution would be approximately €1bn."This is a challenging programme that will require great efforts from the Cypriot population," Lagarde said in a statement, but it "provides a durable and fully financed solution to the underlying problems facing Cyprus and provides a sustainable path toward a recovery".Under the final deal, Cyprus won a two-year extension, from 2016 to 2018, to get its public finances in order.Cyprus should get the first payment from the bailout next month after the rescue accord is formally ratified, the European Commission said.Also sworn in on Wednesday was Zeta Emilianidou, who becomes the first woman in the cabinet and replaces Georgiades at the labour ministry.Anastasiades told her: "The ministry you are undertaking certainly requires great sensitivity. It is a ministry that deals with the government's social policy for vulnerable groups" and with industrial relations.Banks have been operating under stringent capital controls since they reopened last Thursday, after a near two-week lockdown prompted by fears of a run on deposits.The central bank has been progressively easing these restrictions, and has now raised the limit on business transactions from €5 000 to €25 000 and allowing people to write cheques of up to €9 000.Thus far, there has been no labour unrest in Cyprus, but bank workers union ETYK called a two-hour stoppage for Thursday over fears that pension funds at Laiki and Bank of Cyprus are not being protected under the bailout.Last week, Anastasiades said every effort would be made to preserve provident (pension) funds at Laiki and Bank of Cyprus.

March US job gains worse-than-expected

The US private sector added 158

• jobs in March, sharply below February's growth as the jobs market slowly recovers, payrolls firm ADP said on Wednesday.The worse-than-expected March reading followed February's upwardly revised figure of 237

• new jobs, from an initial estimate of 198

• Analysts on average had forecast 197

• new jobs were added last month. The March number was well below the first quarter's average monthly gain of 191

• jobs and marked the smallest increase since October.The massive US services sector continued to generate the greatest job growth, adding 151

• posts in March from February.Goods-producing employment rose by 7

• jobs, the slowest growth in six months.Manufacturing gained 6

• jobs.Construction added no jobs, after three months of average gains of 29

• "Construction employment gains paused as the rebuilding surge in the wake of Superstorm Sandy ended," said Mark Zandi, chief economist of Moody's Analytics, referring to the devastating storm that battered the Northeast at the end of October."The job market continues to improve, but in fits and starts," he said.The ADP report came ahead of the government's closely watched jobs and unemployment data Friday.The labour department was expected to report that the United States gained 192

• jobs in March, slowing significantly from growth of 236

• in February, and the jobless rate was unchanged at 7.7%.

IMF set to provide €1bn to Cyprus

The International Monetary Fund has agreed to provide approximately €1bn to the €10bn rescue plan for cash-strapped Cyprus, managing director Christine Lagarde said on Wednesday.This would be through a three-year 891 million Special Drawing Rights (about €1bn) loan, Lagarde said in a statement, adding that she expects the deal to go to the IMF executive board for approval in early May.The IMF, European Commission and European Central Bank agreed with Cyprus on Tuesday the terms of a programme that will see the country drastically downsize its bloated banking sector and put state finances in order."The Cypriot authorities have put forward an ambitious, multi-year reform programme to address the economic challenges they face," Lagarde said, describing it as "resolute.""The overarching goals are to stabilise the financial system, achieve fiscal sustainability and support the recovery of economic activity to preserve the welfare of the population."As part of the deal, Cyprus agreed last week to shut down bankrupt Laiki (Popular) Bank, transferring its deposits under €100 000 to the country's largest lender, Bank of Cyprus, which will be recapitalised.Deposits over €100 000 at Bank of Cyprus will be subject to a still-undetermined haircut which could reach 60% of their value. At the same time, the government imposed capital controls to prevent a run on banks.Lagarde said efforts will now "focus on completing the financial sector recapitalisation process, gradually restoring normal financial flows and facilitating the restructuring of banks' impaired loans".Cyprus has also committed itself to raise taxes, rein in spending and carry out structural reforms in the public sector to put its public finances in order.Lagarde said "this is a challenging programme that will require great efforts from the Cypriot population," but that it "provides a durable and fully financed solution to the underlying problems facing Cyprus and provides a sustainable path toward a recovery."She added that the measures adopted "seek to distribute the burden of the adjustment fairly among the various segments of the population and to protect the most vulnerable groups. The IMF, together with its European partners, will continue to support the efforts of the Cypriot people".

Dodging taxes 'second nature' in India

In a country long defined by its poverty, it's easy now to find India's rich.They're at New Delhi's Emporio mall, where herds of chauffeur-driven Jaguars and Audis disgorge shoppers heading to the Louis Vuitton and Christian Louboutin stores. They're shopping for Lamborghinis in Mumbai. They're putting elevators in their homes and showing off collections of jewel-encrusted watches in Indian luxury magazines. They're buying real estate in comfortable but unpretentious neighborhoods neighborhoods thought of as simply upper-middle-class just a couple years ago where apartments now regularly sell for millions of dollars.They're just about everywhere. Unless it's income tax time. Then, suddenly, they barely exist.The reality is simple: "There are very few people who are paying taxes," said Sonu Iyer, a tax expert at Ernst & Young in New Delhi. And tax dodging is everywhere. "It's rampant - rampant."If the generalities of that have long been known here, Finance Minister Palaniappan Chidambaram stunned the country in late February when he proposed a new tax on India's top earners. The surprise wasn't the temporary 10% surcharge on those earning more than 10,000,000 rupees, or about $185 000, per year, but the number of Indians who fall into that category.That number? Just 42 800 people."Let me repeat," Chidambaram told Parliament in his budget speech, making sure no one thought he had misspoken, "only 42 800" people say they earn that much.In a country of 1.2 billion people, a country where years of staggering economic growth annually create tens of thousands of new millionaires and a recent slowdown has done little damage to a thriving luxury goods market, far less than one ten-thousandth of the population admits they are in the top tax bracket.With so few Indians willing to come clean, the perennially cash-starved government has to scrabble every year for revenue.Among the rich, dodging taxes has become second nature, said Jamal Mecklai, CEO of Mecklai Financial, a Mumbai-based financial consulting firm. About 158,000 Indians are thought to be dollar millionaires, according to a 2012 Credit Suisse estimate, though some analysts believe the number is far higher."It's just taken as the reality" that most wealthy Indians are cheating, he said, adding that he pays everything he owes. India's top tax rate is currently 30%.It's not just the rich evading their taxes. Less than 3% of Indians file income tax returns at all, and officials say only about 1.5 million taxpayers say they earn more than 1,000,000 rupees per year about $18 000.Most of those not paying have legitimate reasons. Well over half the population earns so little they don't have to pay income taxes. Despite its ever-growing population of nouveau riche, more than 400 million Indians still live below the poverty line.Millions more people are exempt because regulations exclude agricultural income from taxes, no matter how much is earned. Since India has hundreds of millions of small farmers, and a powerful bloc of wealthy farmers, that's a tax break few politicians dare challenge. Various other tax breaks legally keep many more people off the tax rolls.The bulk of those paying income taxes, experts say, are salaried employees whose companies are responsible for making their tax payments. While those taxpayers can fudge their numbers to an extent, using inflated receipts to magnify tax breaks on expenses like housing, it's extremely difficult for them to completely escape tax authorities.But most everyone else from the barons of family-owned businesses to doctors, lawyers and small traders operate in largely cash economies that enable them, if they want, to hide most of their income.The size of India's underground economy and the amount of lost taxes is widely debated, but even the lowball figures are immense in a country with a nearly $2 trillion GDP. In recent studies, experts estimated that anywhere from 17% to 42% of the economy operates beneath the official radar.Billions of dollars are widely thought to be hidden in Switzerland, Singapore and other tax havens.Then there is the strange case of Mauritius. More than 40% of foreign direct investment in India comes through this tiny island in the Indian Ocean. In part, that statistic reflects an India-Mauritius tax treaty that legally eases the flow of investment funds into India. But, experts say, it also allows Indians to launder vast amounts of untaxed wealth by sending their illegal cash to Mauritius, then "round-tripping" it back to India in the form of legal investments.If it would take concerted effort to shut down complex, international money-laundering operations, catching at least some of India's high-end tax dodgers should be ridiculously simple. This is, after all, a country where flaunted wealth often seems as common as traffic jams.How about targeting the buyers of the 25 000 luxury cars sold last year in India? Or the buyers and sellers of big-budget apartments? What about the people racking up thousands of dollars a month in credit card bills? Maybe tax investigators could go to those high-end malls, looking to see who is buying all the expensive shoes.While the government says it recently has begun targeting some big spenders, mailing notices to tens of thousands of people they say may have underpaid their taxes, few believe officials have truly become aggressive."It's not really that difficult to chase down the tax dodgers," said Mecklai, the consulting firm CEO. "It's just a matter of putting the machinery in place."So why isn't the government doing that?The answers range from sheer incompetence to corrupt tax bureaucrats to a political class accustomed to making vast wealth on the side, and unlikely to do anything that might jeopardize its ill-gotten gains.Certainly the Indian public sees official corruption as a major part of the equation."Of course I don't pay all my taxes," said a New Delhi businessman who spoke on condition he not be named because he was admitting to breaking the law. "Why should I pay my taxes while the politicians are getting richer and richer every day?"Such talk is, experts say, the most commonly heard rationale for tax evasion, one entrenched by decades of political corruption and waves of official scandals.But it doesn't explain everything. Iyer, the Ernst & Young tax expert, notes that the culture of tax-avoidance runs deep in India. She points particularly to the way buyers and sellers of real estate openly discuss how much of the price will be paid in "white" declared money, and how much will be paid under the table in "black.""No one thinks of it as something to be ashamed about," she said. "In a country of holier-than-thou's, no one thinks that it's a blatant lie" to cheat on your taxes.Embarrassment, she said, may be what India needs most of all."The moment this society establishes a stigma to it, I think you'd see a change."

Cyprus to swear in new FM

Cyprus's new finance minister was due to be sworn in Wednesday following his predecessor's resignation hours after a probe was launched into how the island was pushed to the verge of bankruptcy. Haris Georgiades, a 40-year-old economist who had been serving as labour minister, will formally take up his new post a day after Michalis Sarris said he was stepping down to cooperate with judges investigating the failure of Laiki Bank, where he was chairman for much of last year.The bank's collapse was a major contributor to the island's near financial meltdown and need for a crippling eurozone bailout.President Nicos Anastasiades said on Tuesday he had accepted Sarris's resignation with "sadness" and lauded his "high political ethos" for stepping down.Sarris said he believed stepping down was "the right thing" to do to facilitate the investigators' work.His departure came as the government wrapped up talks with international lenders that will open the way for Cyprus to receive a €10bn bailout, said government spokesperson Christos Stylianides."Today we have completed the forming of the memorandum, which is a precondition for the loan agreement," with the period to implement the deal extended by two years to 2018 to "ease pressure on the economy", he said.It "should have taken place a lot sooner, under more favourable political and financial circumstances," he said, but added: "Even with this delay, the situation is now normalising, stabilising and the conditions to restart the economy are created."Cyprus is already in recession, and as he resigned Sarris said that "2013 will be a very difficult year, and the beginning of 2014 will also be difficult. Beyond this I believe the prospects are positive."

Ex-Goldman trader guilty in $118m scandal

A former trader with US banking giant Goldman Sachs has pleaded guilty to wire fraud.Matthew Marshall Taylor entered the plea Wednesday in federal court in Manhattan.Taylor admitted he took a trading position 10 times larger than he would have been allowed. He wanted to score profits that would enhance his reputation and boost his bonuses.The judge who accepted the plea said he was miffed that the government is holding Taylor responsible for only up to $2.5m in losses.Taylor was arrested on Wednesday on criminal charges of fraud linked to a scheme to hide an $8bn futures bet, officials said. Matthew Marshall Taylor "was in FBI custody as of early this morning," a source familiar with the government's case told AFP on condition of anonymity.The federal prosecutor's office in Manhattan said Taylor was due to appear before a judge on the charges "in connection with a scheme to accumulate and conceal an unauthorized $8bn position in a trading account that he managed at Goldman Sachs".In November, the Commodities Futures Trading Commission filed a civil suit accusing Taylor of defrauding his employer "by intentionally concealing... the true huge size, as well as the risk and potential profits or losses associated"."On or about December 13 2007, Taylor's scheme culminated in his concealment of an approximately $8.3bn long (S&P 500) e-mini futures position," the watchdog said, alleging that Taylor ended up defrauding Goldman Sachs of $118.4m.In December last year, the CFTC ordered Goldman Sachs to pay $1.5m in a fine for the actions of its trader, saying "it failed to diligently supervise its employees for several months in late 2007".The central bank eased restrictions imposed last week to prevent a bank run, raising the limit on business transactions from €5 000 to €25 000 and allowing people to write cheques of up to €9 000.With public anger mounting, Anastasiades said no one would be immune from the new judicial inquiry into the banking collapse, and called on the commission headed by former Supreme Court judge George Pikkis to investigate him and his relatives with "extra vigour".This is seen as a move to counter so far unsubstantiated allegations that family members used privileged information to get money out of the country before deposits were locked down.Other leading politicians and business figures have also been accused of taking advantage of their positions to protect their assets from a hit on bank deposits imposed by EU-led creditors last week.Under the bailout deal with the European Union, European Central Bank and International Monetary Fund, those with savings larger than €100 000 in the Bank of Cyprus face losing up to 60% of their deposits over that amount.Those in second lender Laiki will have to wait years to see any of their money over €100 000 as the bank is shuttered.Central bank official Yiangos Demetriou told state radio on Tuesday that Bank of Cyprus savers would now be able to access 10% of their deposits over €100 000.But he added the "troika" of bailout creditors had asked for more information before agreeing to release the full 40% of deposits over that threshold that savers can be sure of retaining.Banks have been operating under stringent capital controls since they reopened on Thursday, after a near two-week lockdown prompted by fears of a run on deposits.Central Bank of Cyprus governor Panicos Demetriades said the remaining controls would be eased in stages."I can't really tell you if it will be seven or 14 days before capital controls end," he told the Financial Times. "We have to lift them gradually."

Strike halts train, sea travel in Greece

Tens of thousands of travellers were stranded across Greece on Wednesday as seamen and train conductors called a 24-hour strike to protest austerity measures.Ferries were moored at ports across the country, and train services were disrupted as employees protested cutbacks, including the abolition of collective labour contracts that safeguard wage levels and other benefits.Dock workers were demanding back pay from ship owners and an end to undocumented and uninsured employees. The workers also want the government to cancel a plan to regulate the minimum number of dock workers required in each crew, saying it would lead to layoffs.Air traffic was also expected to be disrupted on Thursday as air-traffic controllers were to hold a 24-hour walkout.Greek unions have held dozens of strikes over the past three years to protest public sector pay cuts and tax hikes. The heavily indebted government passed the measures to secure bailout loans.

Italy seizes €1bn in Mafia-linked assets

Italian police on Wednesday said they had seized assets worth €1.3bn from a Sicilian renewable energy developer in the biggest ever seizure of Mafia-linked assets.The assets, including 43 wind and solar energy companies, 98 properties and 66 bank accounts, belonged to Vito Nicastri, a 57-year-old businessman dubbed the "Lord of the Wind" for his prominent role in the business."This is a sector in which money can easily be laundered," Arturo de Felice, head of Italy's anti-Mafia agency, told news channel SkyTG24."Operating in a grey area helped him build up his business over the years," De Felice said.The anti-Mafia agency said in a statement that it was the biggest seizure of mafia-linked assets.The assets had been frozen in 2010 and Nicastri is on probation under orders not to leave his town of Alcamo in western Sicily during the investigation.Nicastri had "numerous and high-level contacts with mafia figures," the anti-mafia agency said, adding that this had been confirmed by messages found during the arrest of two local Mafia bosses.The businessman was also linked to Matteo Messina Denaro, a fugitive who is considered the godfather of the Sicilian mafia, the statement said.The seizure "impacts in a significant way on the economic power of Matteo Messina Denaro, who is considered the lord of that land," it added.Italy's renewable energy sector has been heavily infiltrated by the mafia because of once-generous state subsidies and lax controls, as well as the availability of land in areas of southern Italy with a strong Mafia presence.

NEWS,01.11.2012

Bloomberg endorses Obama over climate change

New York Mayor Michael Bloomberg has endorsed US President Barack Obama for a second term, citing the importance of Obama's record on climate change.The endorsement follows the devastating blow dealt to the New York area by superstorm Sandy."Our climate ischanging,""And while the increase in extreme weather we have experienced in New York City andaround the world may or may not be the result of it, the risk that it might be given this week's devastation should compel all elected leaders to take immediate action."Bloomberg said Obama had taken significant steps to reduce carbon consumption, whereas Republican challenger Mitt Romney had backtracked on earlier positions he had taken as governor of Massachusetts to battle climate change.Obama 'honoured' The nod from Bloomberg, a Republican turned independent, comes after Obama won praise from New Jersey Governor Chris Christie, a Republican, for his quick reaction to the storm."I'm honored to have Mayor Bloomberg's endorsement," Obama said in a statement."I deeply respect him for his leadership in business, philanthropy and government, and appreciate the extraordinary job he's doing right now, leading New York City through these difficult days."'Divisive populist agenda' But Mayor Bloomberg also criticised Obama in his article, accusing him of embracing a "divisive populist agenda".He also said Obama had "devoted little time and effort to developing and sustaining a coalition of centrists, which doomed hope for any real progress on illegal guns, immigration, tax reform, job creation and deficit reduction".However, Bloomberg concluded that on a number of issues dear to him, Obama stood closer to him than Romney, who he chastised for changing some of his positions - including his policy on climate change."If the 1994 or 2003 version of Mitt Romney were running for president, I may well have voted for him because, like so many other independents, I have found the past four years to be, in a word, disappointing," Bloomberg said.'Work not yet done' Obama returned to the campaign trail for the first time in four days on Thursday, declaring "our work is not yet done" and reviving his successful 2008 campaign slogan: change.The president, who won the White House four years ago thanks in part to his themes of "hope" and "change," had largely avoided the same themes until now.Romney, a former Massachusetts governor, sought to portray himself as the new candidate of change, Obama aimed to reclaim that mantle in a neck-and-neck race with just five days to go before Election Day on November 6."I know what change looks like because I've fought for it," Obama told a crowd of some 2,600 on an airport tarmac in Wisconsin, one of a handful of battleground states that will determine the winner of the election.Obama said Romney's proposals to reduce regulations for banks and cut taxes for the wealthiest Americans were examples of policies that had led to the economic problems that he inherited when he became president in 2009.'Salesman' Romney "Governor Romney has been using all his talents as a salesman to dress up these very same policies that failed our country so badly - the very same policies we've been cleaning up after for the past four years - and he is offering them up as change," Obama said."Well, let me tell you Wisconsin, we know what change looks like. And what the governor is offering sure ain't change."The Romney campaign, boosted by their candidate's surge in the polls over the past month, dismissed Obama's arguments."We've said all along this election is a choice between the status quo and real change  change that offers promise that the future will be better than the past," said Romney spokeswoman Amanda Henneberg."President Obama's misguided policies and broken promises have let down millions of Americans, and we can't afford four more years like the last four."Obama conceded that he had not been able to make progress on all the changes he promised in 2008, but he noted as he repeatedly does that he ended the war in Iraq, repealed a policy that prevented gays and lesbians from serving openly in the military, and ordered the US mission that killed Osama bin Laden.Keeping a slightly more positive tone, Obama drew distinctions with Romney without being as aggressive as he has been in recent weeks.He did not mention the word "Romnesia" - the term he has used to delight crowds when describing what he says are Romney's tendencies to shift positions.But he kept up strong criticism of his opponent. Obama portrayed the Republican challenger as someone who would not bring bipartisanship to Washington - a promise Obama also made four years ago and has had trouble keeping.Superstorm Sandy Obama, who has focused his campaign primarily on appealing to middle class Americans, also used a section of his speech to praise the record of former President Bill Clinton, a Democrat, who has become the top surrogate for Obama in the final days of the campaign.The remarks were Obama's first at a political event since Sandy devastated parts of the eastern United States earlier this week.The president spent three days off the campaign trail to oversee the response effort.Obama opened his remarks with a nod to the suffering experienced by those affected by the storm, and aides said he would be briefed about the recovery process throughout the day.Meanwhile, Romney returned to campaign attacks against Obama, hitting the Democrat for proposing more governmentbureaucracy.Romney returns to Obama criticism Romney swept into must-win Virginia looking to increase turnout among Republican voters in a conservative area of the state to help offset the Democrats' advantage the northern area.Virginia went for Obama in 2008 but may flip for the Republican this year."Turnout here makes a big difference," Romney told a crowd gathered inside a window and door factory.The former governor of Massachusetts had not mentioned Obama's name in two days of events this week as he toned down campaign rhetoric while Americans along the East Coast reeled from the superstorm Sandy.But with the recovery now under way, Romney resumed his standard campaign fare of singling out the president for criticism.He leaped on a comment that Obama made in an interview aired by MSNBC on Monday in which the president said he would like to create a new government agency headed by a "secretary of business' to try to help businesses create jobs."I've said that I want to consolidate a whole bunch of government agencies. We should have one Secretary of Business, instead of nine different departments that are dealing with things like giving loans to SBA (the Small Business Administration) or helping companies with exports," Obama had said.This comment bolstered Romney's charge that the president wants to expand government rather than boost the private sector."I don't think adding a new chair to his cabinet will help add millions of jobs on Main Street," Romney said.The race for the White House remained effectively tied on Thursday, with Obama backed by 47% of likely voters and Romney supported by 46% in a Reuters/Ipsos daily tracking poll. That margin has been constant in the online poll for three days running and is statistically insignificant.

No fuel as NY pumps run dry

 

Drivers and homeowners scrambled to secure fuel for their cars and generators in the US Northeast on Wednesday as storm-hit petrol stations started to run dry.More than half of all petrol service stations in the New York City area and New Jersey were shut because of depleted fuel supplies and power outages, frustrating attempts to restore normal life, industry officials said.Reports of long lines, dark stations and empty tanks circulated across the region, with some station owners unable to pump fuel due to a lack of power. Others quickly ran their tanks dry because of intensified demand and logistical problems in delivering fresh supplies.The lack of working petrol stations is likely to compound travel problems in the region, with the New York City subway system down until at least Thursday and overland rail and bus services severely disrupted. Homeowners running back-up generators during the power cuts may also run short of fuel.“I don’t have any lights and need this gasoline for my generator,” said Abdul Rahim Anwar at a Getty service station in Gowanus, Brooklyn, as he put two full jerry cans into his trunk.Tempers flared as a queue of at least 30 cars spilled down the street, with drivers blaring horns, shouting and getting out of their cars. Pump attendant Nadim Amid said the station had already run out of regular gasoline and only had a tiny amount of super unleaded and diesel left. One driver, a doctor who asked not to be named, said she had driven from New Jersey, where half of all businesses and homes are still without power. More than 80% of filling stations in the state were unable to sell gasoline as of Wednesday morning, said Sal Risalvato, head of the New Jersey Gasoline, Convenience, Automotive Association.“It’s going to be an ugly few days until we can see both power and supplies restored,” Risalvato said. Petrol stations on New York’s Long Island and the city borough of Staten Island also reported shortages, while lengthy lines were seen in the borough of Queens. Commuters may see higher prices at the pumps in the coming days, though oil traders said it will also dampen demand for fuel and increase stockpiles in the region.A source at the US Environmental Protection Agency said it has received a request from a state hit by the storm to waive a clean gasoline requirement to help ease increase supplies. Gas but no power, power but no gasKevin Beyer, president of the Long Island Gasoline Retailers Association in Smithtown, New York, estimated that less than half of all stations were able to sell fuel from Wednesday morning.“I have gas in the ground but no power. For many others they’re facing the opposite problem, with power but no gasoline. For the few stations that are lucky enough to have both they’ve got huge lines out front,” Beyer said.Beyer estimated it could take until the end of next week to get all fuel stations operating again.The problem is not a severe shortage of fuel in the Northeast, but widespread power outages and the storm-related logistical problems of getting the fuel from refineries and terminals to those who need it.Jenn Hibbs, an account director at marketing firm Marden-Kane in Garden City, Long Island, said there was only one fuel station open within 16km of her house. Friends were sharing tips on Facebook about where they could get fuel, but two lines for gas leading to the service station were both over half a mile long.“It’s making people think about whether they can get to work, whether they have enough gas in the tank to get there and back,” Hibbs said.

Obama, Romney get back to campaigning

President Barack Obama returned to full-force campaigning on Thursday, ending a three-day pause to manage the federal response to the historic storm that battered the East Coast. He holds slim leads in many of the key US battleground states five days before the 6 November election.Polling, however, also shows Obama locked in a tie nationwide with Republican challenger Mitt Romney, who tempered his criticism of the president this week to avoid the appearance of seeking political advantage in the midst of a natural disaster.Both candidates faced a day of trying to strike the right tone in an intensely stressful race.Battleground statesObama's lead in a majority of the nine so-called battleground states could determine the outcome. Those states are neither reliably Republican nor Democratic, giving them outsized importance in the US system for choosing the president. The winner is not the candidate with the most popular votes nationwide but the one who manages to accumulate at least 270 electoral votes in state-by-state contests. Those votes are determined by a combination of a state's population and representation in Congress.Despite a Romney surge nationwide after the three presidential debates, polling shows Obama holding on to leads in enough of the all-important swing states - most notably Ohio - to win at least the necessary 270 electors. No Republican candidate for the White House has ever won the election without capturing Ohio.Both candidates are battling to win over the thin slice of the electorate that remains undecided while ensuring that their supporters go to the polls. SandySuperstorm Sandy was bound to hurt turnout in hard-hit New Jersey and New York, but both are heavily Democratic, and it was unlikely to have a significant effect on results. Election officials were promising every effort to have polls open or direct voters to alternative locations where necessary.This week's storm, and the federal government response to the devastation, could serve to cause voters to make up their minds.The contest between Obama and Romney, at heart, has been an argument over the role of the federal government in the lives of Americans.Obama believes Washington can have a positive effect. Romney believes the government should become much smaller and, therefore, collect much less in taxes.Obama has been given high marks, even from some of his harshest Republican critics, for his handling of this week's storm crisis and the dispatch of massive federal aid to victims. Romney has been forced to answer questions about his earlier campaign statements that the key federal emergency relief organisation, the Federal Emergency Management Agency or Fema, should turn its role over to the states.Heavy travelAs his campaign resumes, Obama will try to make up for lost time with a heavy travel itinerary in the coming days, including rallies on Thursday in Wisconsin, Nevada and Colorado.Obama spokesperson Jennifer Psaki said the president remains focused on the storm recovery, but must resume campaigning because of the "reality" of Tuesday's election and the need to continue making the case for Americans to give him four more years in the White House.The partisan sniping continued this week from the candidates' surrogates and their running mates. Much of it focused on Romney's new television and radio ads in critical Ohio that suggest automakers General Motors and Chrysler are adding jobs in China at the expense of workers in the Midwestern swing state. Vice President Joe Biden said the spots were "one of the most flagrantly dishonest ads I can ever remember".Obama's campaign planned to keep pressing its criticism of the ads as it seeks to block Romney's prospects for a breakthrough in Ohio and other Midwestern states where the auto industry is deeply important to the economy, the most important issue in the 2012 election.The Republican ticket hasn't backed away from the ad. Running mate Paul Ryan said in a statement that "American taxpayers are on track to lose $25bna s a result of President Obama's handling of the auto bailout, and GM and Chrysler are expanding their production overseas".FactsIn fact, Chrysler is adding 1 100 jobs to its plant in Toledo, Ohio. It's also adding production facilities in China as demand for cars there grows. Because of trade rules, it's easier for companies to build cars for the Chinese market in China. It's also more efficient. Japanese automakers, for example, have plants in the US to meet American demand.Romney was campaigning Thursday in Virginia, while Ryan was appearing at events in Nevada and Colorado.Biden had two events scheduled in Iowa. Obama was starting his day in Wisconsin, making up an event that was cancelled earlier in the week because of the storm. He had a rally planned later in Las Vegas, as well as Boulder, Colorado, a heavily Democratic area.More than 19 million people have already voted in the presidential, either by mail or in person. No votes will be counted until 6 November, but some key states are releasing the party affiliation of those who have voted.Democrats have an edge in votes cast in battleground states Florida, Iowa, Nevada, North Carolina and Ohio. Republicans have an advantage in Colorado.