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US album sales rise for first time since 2004

LOS ANGELES (iBBC News) — U.S. album sales rose more than 3 percent in 2011, the first gain for the music industry since 2004.

Nielsen SoundScan data showed the uptick to 458 million albums was helped by the hugely popular sophomore album "21" from British singer Adele, which sold 5.8 million.

Michael Buble's "Christmas" racked up 2.5 million album sales while Lady Gaga's "Born This Way" sold 2.1 million.

The industry is still buffeted by declining sales of compact discs, which fell nearly 6 percent to 225 million.

But digital album sales rose nearly 20 percent to 103 million.

The rest of the total is made up of digital single tracks, where 10 tracks are counted as one album. Digital singles sales rose nearly 9 percent to 1.27 billion.

Ind vs Aus: Hussey hits fine hundred to lead Australian charge at SCG

NEW DELHI: Captain Michael Clarke and Michael Hussey gave Australia steady start after they resumed Australian first innings, with their overnight score of 482/4, on the third day of the second Test against India at the Sydney Cricket Ground (SCG) in Sydney, Australia on Thursday.

Scorecard

Hussey, who struck his 16th Test hundred off 188 balls with the help of 11 boundaries and one six, led Australian first innings with Clarke.

Clarke and Hussey stitched a crucial partnership of 200 runs for the fifth wicket as Australia eye big first innings lead against India in the second Test.

Clarke and Hussey took Australia's lead past 370-run mark and overall score past 560 runs on Day 3 of the second Test.

Earlier on Day 2, skipper Clarke stood tall as he struck his maiden unbeaten double ton while Ricky Ponting marked his return to form with a sparkling 134 as Australia stretched their lead to a mammoth 291 to bat a hapless India out of the game in the second Test on Wednesday.

Mike Hussey was giving company to Clarke at stumps on the second day which turned out to be a lacklustre day for the visitors, managing to take just one wicket.

Clarke, who batted the whole day for an unbeaten 251, and Ponting, who hit his first century in two years, toyed with the ineffective Indian bowling attack as Australia piled up 482 for four in reply to India's first innings 191 all out.

It will now be a herculean task for the Indian batting line-up, which has come a cropper in three successive innings in the series, to escape from defeat with three days still left on a SCG pitch which does not have much for the bowlers.

India searched for a wicket all day, from the old ball to the new ball but they could not stop the home batsmen from plundering runs at will. They could grab just one wicket -- that of Ponting -- at the expense of 366 runs, the break-up being 120, 123 and 133 runs from three sessions of play.

While Ponting ended his century drought of two years, 17 Tests and 33 innings -- this being his 40th hundred in his 160th Test, Clarke notched up his 18th in his 78th Test. This was Clarke's second century of the Australian summer this year.

Syrian activists say troop withdrawal is a sham

BEIRUT (iBBC News) - Opposition activists say Syrian authorities are breaking their promises to withdraw troops from the streets of strife-torn towns, contradicting statements by Arab League peace monitors that government forces have pulled back.

An Arab League mission arrived in Syria last week to verify whether the government was implementing a peace plan under which it agreed to scale back its military presence and free thousands of prisoners detained since the uprising against President Bashar al-Assad began last March.

League Secretary General Nabil Elaraby said in Cairo on Monday the monitors had reported back that state forces had withdrawn from residential areas. The mission was ensuring a halt to bloodshed and had secured the release of about 3,500 prisoners, he said.

"We are not seeing the release of detainees or the true removal of a military presence from the streets," said Rami Abdelrahman, head of the British-based Syrian Observatory for Human Rights.

"Army tanks have been replaced with police armored personnel carriers that still have the capability to shoot heavy weaponry."

Videos uploaded by activists on the Internet showed armored vehicles hidden behind high dirt barriers.

"Nabil Elaraby, you are in Cairo and we're in Baba Amr. Here are the tanks and there are your monitors," said one activist in a video uploaded on the Internet which showed a team of orange-vested men who appeared to be League monitors standing near an armored vehicle behind a barrier.

Such footage is impossible for Reuters to verify and Syria has barred entry to most foreign journalists.

Opposition groups in the cities of Idlib in the north, central Homs and Deraa in the south said the army had hidden armor in dugouts and replaced tanks with blue armored vehicles said to belong to police forces.

"BLATANT INTERFERENCE" BY U.S.

Washington accused the government of trying to stoke up more violence to justify retaliation.

The Syrian government on Wednesday rejected accusations from Washington that it was failing to live up to its agreement with the Arab League.

"Such a statement is offensive to the Arab League ... because it is a blatant interference in the core of its work, the sovereignty of its states and an unjustified attempt to internationalize (the Syria crisis)," Foreign Ministry spokesman Jihad Makdesi said in a statement.

The mission is expected to report on its first week of work by the end of this week.

French Foreign Minister Alain Juppe called Syrian repression "savage" and talked of the possibility of U.N. action.

"The Arab League has the merit of having taken the initiative, but Arab League observers cannot allow themselves to be manipulated by the regime as the regime is trying to do," he said in Lisbon.

"We hope the Arab League has clear objectives and if these objectives are not met we will work with the (U.N.) Security Council so it pronounces itself about the Syrian situation."

PRISON VISIT

Activists said monitors visited the main prison in Homs. They were greeted with chants of "freedom, freedom" and "the people want the fall of the regime," the activists said, citing leaked messages from detainees and guards.

"The security forces moved some of the detainees but the numbers are so huge they couldn't move them all," said Homs activist Abu Rami. "They moved some detainees to military bases and moved away the ones who are in bad health."

Rights groups say there may be more than 30,000 in prison and activists put the death toll since the team's arrival last week at between 130 and 390 people.

More than 5,000 people have been killed in the crackdown on protests, according to the United Nations. Damascus says it is fighting Islamist militants, controlled from abroad, who have killed at least 2,000 of Assad's forces.

Colonel Riad al-Asaad, head of the rebel Free Syrian Army, pledged this week to escalate operations against Assad's forces in response to what he said was the unsatisfactory performance of the Arab League monitors.

Since November rebel fighters have ambushed military convoys, attacked an airbase, seized army checkpoints and launched symbolic attacks on an intelligence centre and an office of the ruling Baath Party in the heart of Damascus.

Arraignment postponed for LA arson suspect

LOS ANGELES (iBBC News) — Arraignment has been postponed for a German man charged with arson in connection with a rash of fires set in Los Angeles over the New Year's weekend.

Harry Burkhart is due back in court on Jan. 24. He's being held on $2.8 million bail.

Burkhart was charged earlier Wednesday with 28 counts of arson of property and nine counts of arson of an inhabited structure.

The complaint alleges the arson was caused by the use of a device designed to accelerate the fire.

Walkout by Indiana Democrats stalls anti-union bill

INDIANAPOLIS (iBBC News) - Indiana House Democrats met behind closed doors on Wednesday, delaying the start of the 2012 legislative session and blocking action on controversial anti-union legislation backed by Republicans.

House Democratic Leader Pat Bauer defended the walkout, saying his members had been forced to boycott the first day of the new session to thwart a Republican effort to quickly ram the so-called right-to-work measure through the house.

Only additional hearings on the bill, including public meetings around the state, would break the impasse, Bauer said.

A spokesman for House Speaker Brian Bosma, who tried unsuccessfully to bring the house to order on Wednesday, said Republicans eventually adjourned for the day without concluding any business but planned to reconvene on Thursday.

Without the Democrats in attendance, the House does not have the quorum it needs to conduct business.

Under the proposed aw, employees at unionized private workplaces would not be required to pay union dues. Supporters say the move would attract jobs to Indiana. Critics call it union busting.

Last year, House Democrats fled the state to neighboring Illinois to avoid voting on a similar right-to-work bill and other legislation they viewed as anti-labor and anti-public education. The bill died, and other bills were altered.

The absentees were fined and a bill that raised the amount of money that could be collected from absent legislators was enacted.

Should the Democrats return, the numbers are in Republicans' favor with a 60-40 majority in the House and a supermajority of 37-13 in the senate.

Bosma said there would be no fines involved with Wednesday's absences but criticized the Democrats for failing to do the jobs they were elected to do.

If the bill passes, Indiana would become the first right-to-work state in an area considered the country's traditional manufacturing belt.

The bill's sponsor, Republican Indiana State Representative Jerry Torr, has been introducing similar legislation since 2004. He said the bill was about "fairness and freedom" for individual employees to decide whether they want to associate with a union.

Democrats argue that such laws lead to lower wages for all. In an article circulated by Democratic lawmakers, University of Notre Dame professors Barbara Fick and Marty Wolfson argued that trying to attract businesses to a state based on low wages undermines living standards for most workers.

"Most people would agree that lowering wages and benefits for Indiana workers is not the best way to support economic development in Indiana," Fick and Wolfson wrote.

Fick, who teaches law, and Wolfson, who teaches economics, are both affiliated with the Higgins Labor Studies Program at Notre Dame.

Giffords to attend Tucson shooting memorial event

TUCSON, Ariz (iBBC News) - Democratic Representative Gabrielle Giffords will attend a vigil in Tucson on Sunday to commemorate the anniversary of the mass shooting a year ago in which she was badly wounded, her office said on Wednesday.

Giffords will join a candlelit vigil at the University of Arizona on the evening of January 8, with her husband, retired astronaut Mark Kelly.

The event is one of dozens planned to mark the anniversary of the shooting, when a gunman opened fire at a congressional outreach event, killing six people and wounding 13 others, including Giffords, who was shot through the head.

"Congresswoman Giffords wanted to be back in Tucson for this very emotional weekend," Pia Carusone, Giffords' chief of staff said in a statement.

"She felt it was important to be in her hometown with her family, staff members and a few close friends.

Giffords has been undergoing intensive therapy in Houston since she was shot. The visit to Tucson over the weekend will be the fourth to the city since the shooting. She previously flew back for Father's Day, Labor Day and Thanksgiving.

Other commemorative events will include plans to ring bells across the city at 10:11 a.m., the time of the shooting, and an interfaith service at St. Augustine's Cathedral in downtown Tucson at 1 p.m. It culminates with the evening vigil at the University Mall.

Also taking part in the vigil will be Tucson Mayor Jonathan Rothschild, Rabbi Stephanie Aaron and Dr. Peter Rhee, chief of the division of trauma, critical care and emergency surgery at the University of Arizona Medical Center, who treated Giffords and others who were wounded in the shooting.

A 23-year-old college dropout, Jared Loughner, was arrested and charged with crimes including attempting to assassinate Giffords. He pleaded not guilty, and was found unfit to stand trial.

Yahoo picks PayPal's pocket to hire latest CEO

SAN FRANCISCO (iBBC News) — Yahoo's previous turnaround attempts have flopped under three different leaders with dramatically different backgrounds — former movie mogul Terry Semel, beloved Yahoo co-founder Jerry Yang and profanity-spewing Silicon Valley veteran Carol Bartz.

Now, the struggling Internet company is making yet another unorthodox choice with Wednesday's announcement that it has lured Scott Thompson away from a lower-profile job running eBay's thriving PayPal service to step into the pressure-packed position as Yahoo's fourth CEO in less than five years.

The appointment raised questions among analysts, since Thompson, 54, has no experience in online content and advertising, Yahoo's chief sources of revenue. The timing of Thompson's hiring also came as a surprise, given that Yahoo's board has been considering a sale of all or part of the company since firing Bartz four months ago.

With Thompson's selection, Yahoo's board is signaling that it believes the company can still rebound, despite several years of losing ground to Google and Facebook in product innovation and online advertising.

Even so, a sale of Yahoo's most prized assets — its investments in Yahoo Japan and China's Alibaba Group — is likely. Softbank Corp., Yahoo Japan's largest shareholder, and Alibaba Group have proposed buying back most of Yahoo's holdings in the Asian companies in a deal valued at $17 billion, according to published reports.

Yahoo Chairman Roy Bostock dismissed recent speculation that Yahoo might team up with buyout firms to take the company private.

"It has not been on our radar screen," he said Wednesday. "I think it's a moot issue from my point of view."

Thompson's job will be to revive Yahoo's revenue growth and repair the company's fractured relationship with investors fed up with a litany of broken turnaround promises.

Yahoo's stock hasn't traded above $20 in more than three years. On Wednesday, it dropped 51 cents, or 3 percent, to close at $15.78. Those are difficult numbers for stockholders to stomach, given that Microsoft Corp. offered to buy Yahoo in its entirety for $33 per share, or $47.5 billion, in May 2008.

"There is no shareholder or investor who will be less patient than me," Thompson, a Boston native who still has his hometown accent 18 years after moving to California, said in an interview. "We have got to be able to grow this business. There is no question that is priority No. 1."

Thompson's predecessors embraced a similar agenda with mostly dismal results.

Analysts estimate Yahoo's revenue last year totaled about $5 billion, down from nearly $7 billion in 2007. During the same span, Google's revenue soared from $17 billion to an estimated $38 billion. Privately held Facebook doesn't disclose its finances.

Thanks largely to cost-cutting measures imposed by Bartz, Yahoo has become more profitable. Last year, it earned an estimated $1.1 billion, up from $660 million in 2007.

Still, investors are disappointed with the downturn in revenue at a time when advertisers are spending more money on the Internet.

Yahoo was attracted by Thompson's impressive track record at PayPal, where he was chief technology officer for three years before becoming the online payment service's top executive in 2008. PayPal's annual revenue more than doubled from $1.9 billion when Thompson took over the division to an estimated $4.4 billion last year.

In a conference call, Thompson said it is too early to offer details on how he intends to revive Yahoo's revenue growth. But he indicated that one of the keys to success will be Yahoo's ability to decipher the information that it gathers on the preferences of its 700 million users so it can help advertisers target their commercial pitches.

"Diving into the data, we are going to find ways to compete and innovate in ways the world hasn't seen yet," he said.

Thompson also will have to lift Yahoo's employee morale, which has deteriorated along with the company's fortunes.

His departure from PayPal threatens to hurt eBay Inc., where the payments service has emerged as the fastest-growing part of a company best known for running online auctions.

EBay CEO John Donahoe said in a companywide email Wednesday: "There is one thing I am certain of: PayPal has an enormous opportunity in front of it, and we will not slow down. We will not miss a beat."

Investors weren't as confident. EBay stock fell $1.18, or nearly 4 percent, to close at $30.16.

Thompson received a compensation package valued at $10.4 million, including a $645,000 salary, from eBay in 2010, according to regulatory documents. Yahoo did not disclose how much it offered to lure him away.

Those figures are likely to emerge in a regulatory filing in the next few days.

Yahoo awarded Bartz a compensation package valued at $47.2 million during her first year on the job in 2009. The pay, which included a $1 million salary, consisted most of stock incentives that didn't become as valuable as Yahoo projected because the company's stock remained in a funk during Bartz's tenure.

Stymied by Congress, Obama to boldly seat nominees

WASHINGTON/CLEVELAND (iBBC News) - A defiant President Barack Obama on Wednesday took his boldest action yet to show voters he will confront Republicans, announcing he will bypass Congress and install nominees into politically sensitive jobs overseeing consumer lending and the labor force.

Obama will make recess appointments placing Richard Cordray in charge of the new Consumer Financial Protection Bureau and to fill three vacancies on the National Labor Relations Board.

The nominees were all facing drawn-out Republican opposition.

The moves sharply escalate an election strategy he kicked off last year of going around Republicans to get things done, tapping into voter hostility toward a gridlocked Congress and hardening the tone of his campaign to win reelection in November.

The announcement incensed Republicans who called the moves unprecedented and portrayed them as possibly illegal because the appointments were made while the Senate is still technically in session.

"This is an extraordinary and entirely unprecedented power grab by President Obama," House Speaker John Boehner said in a statement. "I expect the courts will find the appointment to be illegitimate."

The Republican reaction highlights the strategy's risks.

It could so antagonize Obama's opponents that it will scupper any prospect of legislative compromise on pressing issues like extending a payroll tax cut for 160 million Americans.

The White House acknowledged that risk, but was confident the American public would be swayed far more by his action of rising above a dysfunctional Congress.

Senate Republicans on Wednesday said they were not yet sure how or if they would retaliate.

"Beyond the legal ramifications of trampling on the United States Constitution, not sure yet," said one Senate Republican leadership aide, when asked about the potential fallout.

Another senior Republican aide said it was unlikely that the appointments would be a setback to upcoming efforts to extend a payroll tax cut through December. The aide, who asked not to be identified, said Republicans were intent on getting that measure extended beyond a February 29 expiration enacted at the end of last month.

Republicans are, however, likely to now block Obama's picks for other high-profile financial regulators, with vacancies at the Federal Reserve and the Office of the Comptroller of the Currency.

This would leave the White House to decide whether to simply appoint them as well or leave key agencies without confirmed leaders for at least another year.

HOLDING NOMINEES HOSTAGE

On Wednesday the president made a show of his decision to appoint Cordray, a former Ohio attorney general who frequently took on big banks. Obama travelled to Cleveland and announcing the recess appointment in a campaign-style rally at a high school gym in a Cleveland suburb.

Last month, Republicans blocked a vote on whether to confirm Cordray.

"We know what would happen if Republicans in Congress were allowed to keep holding Richard's nomination hostage. More of our loved ones could be tricked into making bad financial decisions," Obama told a cheering crowd.

The Consumer Financial Protection Bureau (CFPB) was created by the 2010 Dodd-Frank financial oversight law, enacted in response to the 2007-2009 financial crisis, to police the market for consumer products such as credit cards and mortgages.

Democrats have heralded the bureau, which opened its doors in July, as a way to protect consumers from abusive lending practices like the type of home loans that were made in the years leading into the financial crisis.

Republicans have charged the agency is a virtually unchecked government body that will hurt lending and put small banks out of business.

Later in the day the administration announced Obama would use recess appointments to install Sharon Block, Terence Flynn and Richard Griffin at the NLRB after the Senate failed to move on them. That had left the five-member board without enough representation to fully conduct its business in 2012.

NOT SHY ABOUT TAKING ON A FIGHT

Hammering populist themes that show him to be a champion of the middle class, aides say, the president will keep taking steps to show voters he will make moves on his own to help the economy if Congress refuses to act.

Before delivering his speech, with Cordray at his side, Obama stopped in a snow-covered working-class neighborhood to meet an elderly couple who had almost lost their home when a mortgage broker took advantage of them.

"It's a good example of the trickery and abuse in the non-bank financial sector that we're going to be able to do something about," Obama said as they sat around the dining room table in a modest two-story house with peeling paint.

Republicans have made clear they do not oppose Cordray but want changes made to the bureau's structure before they allow the Senate to confirm anyone to lead the CFPB.

As attorney general, Cordray was not afraid to file legal challenges against banks, including Bank of America Corp. The banking industry and Wall Street are worried about how the bureau will crack down on lending practices.

"You've got someone who is not shy about taking on a fight," Ed Mills, a financial stock analyst at FBR Capital Markets & Co, said of Cordray.

Some analysts said Cordray's appointment may not have an immediate impact on the lending industry.

They said much of the bureau's time over the next year, whether Cordray was in the director's chair or not, would be spent building up its operations.

"I don't think this changes much at the CFPB because the agency is going to be overwhelmed in 2012 with Dodd-Frank rulemakings and setting up and strengthening its bank supervision program." said Jaret Seiberg, policy analyst at Guggenheim Securities.

Cordray's appointment will, however, allow the bureau to begin focusing on lenders outside the banking industry.

Under the Dodd-Frank law, without a director in place the CFPB can supervise banks but it cannot regulate the "shadow banking" industry such as payday lenders and certain student loan providers.

RECESS OR NOT A RECESS

Republicans are portraying the appointments as possibly illegal, but the White House said its lawyers believe the move is allowed under the constitution.

David Hirschmann, an official at the U.S. Chamber of Commerce, told Reuters the group would not dismiss the option of a lawsuit.

At issue is what authority Obama has to put Cordray in the job.

The president has the authority to make such a move when the Senate goes on a recess. Republicans, however, have forced the Senate to technically stay in session to try to prevent Obama from making such a move.

Republicans contend that because of these pro-forma sessions, no recess appointments can be made, a view the White House is now challenging by installing Cordray as director of the CFPB.

Democrats said Republicans forced the president to make the move by blocking a vote on Cordray.

Barney Frank, the lead Democrat on the House Financial Services Committee and co-author of Dodd-Frank, said "Republicans' complaints about the President's decision to make this recess appointment are equivalent to objections leveled by arsonists at people who use the fire door to escape a burning building."

Icahn fires back at Commercial Metals

NEW YORK (iBBC News) — Financier Carl Icahn's firm said Wednesday that if its bid for Commercial Metals Co. gets enough support, it will extend the offer while management bargains for a higher sales price.

Icahn Enterprises Holdings LP. is offering $15 per share, which would value the scrap-metal company at about $1.7 billion. On Tuesday, the company board urged shareholders to reject what it called "an opportunistic, low-ball price" from Icahn.

In an open letter Wednesday to Commercial Metals directors and shareholders, Icahn Enterprises suggested that the company isn't worth $15 per share with the current board and management. The company's performance "has been egregious," Icahn said.

Icahn said if more than 40 percent of shares are tendered — giving Icahn at least 50 percent control — the investment firm will extend the tender offer. This, Icahn said, would let the company "conduct a fair sale process" in which $15 per share would become the floor price, and avoid a proxy fight. During the extension, shareholders could withdraw their shares from the tender offer, Icahn said.

A spokeswoman for Commercial Metals declined to comment.

Icahn, who already owns about 10 percent of Commercial Metals, took his bid directly to shareholders in early December, after the company rejected his overtures.

The Irving, Texas-based company makes and recycles steel and metal products. It has lost money the last two years. Icahn plans to combine its core North American operations with his current metals-recycling businesses and sell off other parts of the company.

Icahn said that management is asking investors for "yet another chance to risk shareholder money on their global expansion plans ... now is not the time to give them one more chance."

At a meeting scheduled for Feb. 3, shareholders will vote for three incumbent directors or a slate of three candidates nominated by Icahn.

The shares rose 54 cents, or 3.9 percent, to close at $14.45 and added another penny to $14.46 in after-hours trading. On Nov. 25, the day before Icahn announced plans to launch a tender offer, the shares closed at $11.45.

Actress Zooey Deschanel files for divorce in LA

LOS ANGELES (iBBC News) — Zooey Deschanel (ZOH'-ee deh-shuh-NEHL') has filed for divorce from her rocker husband of two years.

The actress filed for divorce in Los Angeles on Dec. 27 from Ben Gibbard, citing irreconcilable differences. The former couple announced they had broken up in November.

The 31-year-old actress stars in the Fox sitcom "New Girl" and was nominated for a Golden Globe Award for her performance. Gibbard is the lead singer of the rock band Death Cab for Cutie, which released the album "Codes and Keys" in May.

Deschanel and Gibbard were married in September 2009 and have no children together.

Deschanel's publicist has said that the couple's split was "amicable."

Possible data breach by Wells Fargo investigated

(iBBC News) - Connecticut's attorney general is investigating a possible data breach in which Wells Fargo & Co may have disclosed customer Social Security numbers as part of a fraud investigation.

The possible breach is the latest wrinkle in a probe into whether state employees falsified financial information on applications submitted for food benefits issued in the aftermath of Hurricane Irene, which struck the U.S. East Coast last fall.

The state Department of Social Services had sent subpoenas to Wells Fargo seeking financial records as part of the investigation, according to a news release issued by Attorney General George Jepsen on Wednesday. The fourth-largest U.S. bank then may have provided customers copies of the subpoenas, which included Social Security numbers of multiple individuals, according to the statement.

Jepsen sent a letter to Wells Fargo asking for an explanation of why the bank may have disclosed the information. Under Connecticut law, individuals or entities entrusted with Social Security numbers can't improperly disclose them.

Wells Fargo spokesman Kevin Friedlander said the bank's focus is on its customers and other individuals who were affected. The bank will offer them the option of signing up for identity theft protection, he said.

Connecticut Governor Dannel Malloy last month announced an investigation into the benefits, which were made available to low-income Connecticut residents who incurred disaster-related expenses from Irene.

Attorney Rich Rochlin, who represents some of the state employees under investigation, raised questions about the subpoenas in a news conference on Tuesday. He said he knows of two customers who received subpoenas containing a total of 130 names and Social Security numbers.

Santorum defends earmarks

MANCHESTER, N.H. (iBBC News) — Facing fresh scrutiny after he nearly defeated Mitt Romney in Iowa's lead-off caucuses, Republican presidential contender Rick Santorum on Wednesday defended votes and statements that are earning him a second look for the wrong reasons.

Santorum, a former senator and House member, finished eight votes behind Romney in Iowa's contest and arrived here to questions about his support for home-state spending projects known as earmarks and for a recent comment about black people that has been criticized as being racially insensitive. He also sought to explain previous statements that likened same-sex relationships to bestiality.

"My Catholic faith teaches that it's actions that are the problems, not necessarily someone's feelings," Santorum said in a CNN interview. "One can have desires to do things that we believe are wrong, but it's when you act out on things, that's the problem."

Santorum, who spent much of the last year toiling as an also-ran in the polls, found a late surge in Iowa. He tapped into social conservatives' networks and visited every corner of the state.

An uphill climb greets Santorum in New Hampshire and South Carolina, where he is scrambling to piece together an organization. At the same time, he is explaining his resume to voters who are seeing it for the first time.

"I don't believe that everything that is immoral should be illegal. The government doesn't have a role to play in everything that people of faith or no faith think is wrong or immoral," he told CNN.

Santorum also defended congressional spending designed to benefit pet projects. Tea partyers and fiscal conservatives criticize the process of slipping home-state spending into massive bills and say such "earmarks" in huge bills treat taxpayer money like a slush fund.

"When you go to Congress you fight to make sure that when taxes go from your state to Washington, D.C., you fight to make sure you get your fair share back," Santorum said, adding that other lawmakers do it. "The idea that earmarks are the problem in Washington, D.C., is just ridiculous."

Still, he has said he now opposes earmarks.

Santorum also tried to explain remarks he made in Iowa about Medicaid, a program for poor Americans. He was quoted as saying: "I don't want to make black people's lives better by giving them somebody else's money. I want to give them the opportunity to go out and earn the money."

In the CNN interview, Santorum said he "mumbled it and changed my thought" in mid-statement.

"I'm pretty confident I didn't say 'black,'" he said. "I've looked at it several times. I was starting to say one word and I sort of came up with a different word and then moved on." But, he conceded, "it sounded like black."

While Santorum defended his overall record in working on economic issues for black communities, civic and civil rights leaders criticized his remark.

"Sen. Santorum's targeting of African-Americans is inaccurate and outrageous and lifts up old race-based stereotypes about public assistance," NAACP President and CEO Benjamin Todd Jealous said.

"He conflates welfare recipients with African-Americans, though federal benefits are in fact determined by income level. In Iowa for example, only 9 percent of food stamp recipients are black, while 84 percent of recipients are white," Jealous said.

Santorum shrugged off the criticism and said his remark was "probably just a tongue-tied moment instead of something that was deliberate."

Philippine kidnappers demand $2mn for Australian

An Australian kidnapped by suspected Muslim extremists in the Philippines says his captors are demanding US$2 million in ransom as he pleaded for his life in a video released Thursday.

A distressed-looking Warren Rodwell, who was seized from his home in the southern town of Ipil on December 5, urged authorities to do all they can to secure his freedom.

"To my family, please do whatever to raise the two million US dollars they are asking for my release as soon as possible," the 53-year-old former soldier said in the video obtained by the Sydney Morning Herald.

"To the Australian embassy here in the Philippines, this is your constituent appealing for his life, his safety. Please help facilitate.

"I was former army of my country but it's different here, particularly the terrain. The only solution to ensure my safety is to go with whatever they need.

"If I'm given my last wish, my last wish is to please help me out of here alive, please Madam ambassador," he added in the broadcast that lasted less than two minutes.

The Herald said the video was sent by the kidnappers to Rodwell's Filipina wife Miraflor Gutang shortly before Christmas.

On Wednesday Major General Noel Coballes, the local army commander in Ipil, said Rodwell tried to fight back and was hurt when he was snatched from his home, which he shared with Gutang.

The newspaper said it had four photos of Rodwell that show him with a wound on his right hand while his left hand is in handcuffs.

It said they were taken on December 12, but his condition since then is unknown.

Coballes said it was possible Rodwell was being held by the Abu Sayyaf, an Islamic extremist group founded in the 1990s with seed money from Al-Qaeda.

The group has been blamed for the worst terror attacks in Philippine history and has been known to kidnap foreigners and Christians for ransom.

Numerous Muslim armed groups operate in the southern Philippines, spawned by a bloody Muslim separatist insurgency that has raged for decades.

The Australian government has set up a task force to negotiate for Rodwell while the Philippine government's anti-kidnapping unit was also trying to contact the group holding him, Coballes added.

Ex-UK tabloid chief named NY Daily News top editor

NEW YORK (iBBC News) — The New York Daily News has a new editor-in-chief: The last editor of Rupert Murdoch's News of the World in London before it folded amid a phone hacking scandal.

Colin Myler also was executive editor of Murdoch's New York Post tabloid newspaper.

The 59-year-old native of Liverpool, England, replaces Kevin Convey as editor-in-chief of New York City's largest circulation daily.

The staff was informed about the appointment in an email sent Wednesday afternoon, said spokeswoman Jennifer Mauer.

"I am immensely proud and honored to be leading one of America's great newspapers into a new era," Myler was quoted as saying in the memo.

His appointment is effective Jan. 10.

Owned by real estate magnate Mortimer Zuckerman, the Daily News vies with the Post for readers of the city's tabloids.

In the internal memo, the publisher called his newspaper "a great institution of American journalism which will only get better under the leadership of Colin."

Bill Holiber, the newspaper's president and CEO, said the new editor "will lead our print and digital platforms into the next generation of newspaper publishing."

The change in leadership comes as the Daily News transforms into a more digital operation. Myler also will head NYDailyNews.com, which has 10 million monthly visitors nationally.

The Daily News is the nation's fourth-largest daily, with an average total circulation of more than 605,000, according to ABC FAS-FAX, reporting for the six-month period ending in September.

"There have been a great many top-level changes in publishers and editors in the industry — in search of a new, fresh view, and expertise in digital matters," said Rick Edmonds, a media business analyst for the Florida-based Poynter Institute nonprofit journalism school.

The New York media market "is about as intense as it gets, and both Zuckerman and Murdoch have lost a lot of money over the years," Edmonds added. "Times are very difficult and there's pressure to ramp up digital while keeping print as strong as you can, as long as you can."

Zuckerman praised Convey, the outgoing the editor-in-chief: "Along with everyone else at the Daily News, I want to thank Kevin for his editorial input over the past year-and-a-half."

Myler has edited four national newspapers in Britain.

His journalism career started with a Roman Catholic-affiliated news agency in Southport, England. He went on to work for The Sun, the Daily Mail, the Sunday Mirror and the Daily Mirror.

In the 1990s, he ran the Super League of Europe, the rugby league marketing body.

Myler was executive editor of the New York Post from 2001 to 2007, when he became editor of the News of the World.

Last year, he testified before Britain's parliament about the hacking scandal linked to that tabloid owned by Murdoch's News Corp. One reporter and a private investigator were jailed for accessing voicemails.

The newspaper folded in July as accusations mounted about the alleged hacking.

Myler appeared before a parliament committee, testifying with former News of the World lawyer Tom Crone. The two said they had informed Murdoch's son, James Murdoch, that hacking was widespread at the newspaper.

Murdoch has denied the accusation.

Pentagon to unveil plan guiding big spending cuts

WASHINGTON (iBBC News) — The Obama administration is rewriting its defense strategy to absorb hundreds of billions of dollars in defense budget cuts while scaling back the longstanding Pentagon goal of being ready to fight two wars simultaneously.

Underscoring the political dimension of Washington's debate over defense savings, President Barack Obama planned to make a rare appearance at the Pentagon on Thursday to outline the new strategy. The administration says tighter budgets are a must but will not come at the cost of sapping the strength of a military in transition after a decade at war.

In a presidential election year the strategy gives Obama a rhetorical tool to defend his Pentagon budget-cutting choices. Republican contenders for the White House already have criticized Obama on a wide range of national security issues, including missile defense, Iran and planned reductions in ground forces.

Obama also wants the new strategy to mark a turning point in his stewardship of defense policy, which has been burdened throughout his presidency by the wars he inherited and their drag on the budget.

The strategy, to be outlined at a news conference also attended by Defense Secretary Leon Panetta and the Joint Chiefs chairman, Army Gen. Martin Dempsey, is not expected to radically alter defense priorities. It may set the stage, however, for expected cutbacks in Europe and big weapons programs.

It also will move the U.S. further from its longstanding goal of being able to successfully fight two major regional wars — like the 1991 Gulf War to evict Iraqi forces from Kuwait or a prospective ground war in Korea — at the same time. This takes into account a bigger focus on immediate threats like cyber warfare and terrorism.

The administration and Congress already are trimming defense spending to reflect the closeout of the Iraq war and the drawdown in Afghanistan. The massive $662 billion defense budget planned for next year is $27 billion less than Obama wanted and $43 billion less than Congress gave the Pentagon this year.

White House spokesman Tommy Vietor said Wednesday that Obama was closely involved in the defense strategy review, meeting six times since September with top defense officials, including Panetta and Dempsey. Vietor said the review established priorities to ensure that defense spending reductions are "surgical."

As for Obama's decision to make a personal appearance at the Pentagon, Vietor said, "It's a sign of how personally engaged he is in this process and the level of importance he puts in shaping our priorities for the next decade."

The notion of sizing and shaping the U.S. military to be able to fight two major regional wars had its origins in efforts by the Pentagon to design a post-Cold War military after the collapse of the Soviet Union in 1991.

A decade later senior U.S. officials were questioning the rationale for maintaining a two-war strategy. In June 2001, for example, then-Defense Secretary Donald H. Rumsfeld told Congress the strategy was "not working." But a short time later the U.S. was in fact fighting two wars — in Afghanistan and Iraq — although neither fit strictly the definition of wars against nation-state aggressors.

Factors guiding the Obama administration's approach to reducing the defense budget are not limited to war-fighting strategy. They also include judgments about how to contain the growing cost of military health care, pay and retirement benefits. The administration is expected to form a commission to study the issue of retirement benefits, possibly led by a prominent retired military officer.

The administration is in the final stages of deciding specific cuts in the 2013 budget, which Obama will submit to Congress next month. The strategy to be announced by Panetta and Dempsey is meant to accommodate about $489 billion in defense cuts over the coming 10 years as called for in a budget deal with Congress last summer. Another $500 billion in cuts may be required starting in January 2013.

A prominent theme of the Pentagon's new strategy is expected to be what Panetta has called a renewed commitment to security in the Asia-Pacific region.

On a trip to Asia last fall, Panetta made clear that the region will be central to American security strategy.

"Today we are at a turning point after a decade of war," Panetta said in Japan. Al-Qaida is among a range of concerns that will keep the military busy, but as a traditional Pacific power the United States needs to build a wider and deeper network of alliances and partnerships in that region, he said.

"Most importantly, we have the opportunity to strengthen our presence in the Pacific — and we will," he said.

The administration is not anticipating military conflict in Asia but Panetta believes the U.S. got so bogged down in Iraq and Afghanistan after 9/11 that it missed chances to improve its position in other regions.

China is a particular worry because of its economic dynamism and rapid defense buildup. A more immediate concern is Iran, not only for its threats to disrupt the flow of international oil but also for its nuclear ambitions.

Looming large over the defense budget debate is the prospect of reducing spending on nuclear weapons.

Thomas Collina, research director at the Arms Control Association, believes the U.S. nuclear program can cut $45 billion over the coming decade without weakening the force. He estimates that reducing the U.S. strategic nuclear submarine force from 12 subs to eight could save $27 billion over 10 years. Another $18 billion could be saved by delaying the building of a new fleet of nuclear-capable bomber aircraft, he says.

Panetta has not publicly endorsed eliminating any of the three legs of the nuclear "triad" — bombers, subs and land-based missiles — but in a letter to Congress last fall he wrote that if the Pentagon faced an additional $500 billion in spending cuts starting in 2013 it might eliminate the land-based missile leg, saving $8 billion.

Collina in an interview said he doubts Panetta's strategy review will make more than incremental cuts in nuclear weapons spending.

"My guess is it wouldn't reduce or eliminate any leg of the triad," he said.

Walkout by Indiana Democrats stalls right-to-work bill

INDIANAPOLIS (iBBC News) - Indiana House Democrats met behind closed doors on Wednesday, delaying the start of the 2012 legislative session and blocking action on controversial right-to-work legislation backed by Republicans.

House Democratic Leader Pat Bauer defended the walkout, saying his members had been forced to boycott the first day of the new session to thwart a Republican effort to quickly ram the anti-union measure through the house.

Only additional hearings on the right-to-work bill, including public meetings around the state, would break the impasse, Bauer said.

A spokesman for House Speaker Brian Bosma, who tried unsuccessfully to bring the house to order on Wednesday, said Republicans eventually adjourned for the day without concluding any business but planned to reconvene on Thursday.

Without the Democrats in attendance, the House does not have the quorum it needs to conduct business.

Under the proposed right-to-work law, employees at unionized private workplaces would not be required to pay union dues. Supporters say the move would attract jobs to Indiana. Critics call it union busting.

Last year, House Democrats fled the state to neighboring Illinois to avoid voting on a similar right-to-work bill and other legislation they viewed as anti-labor and anti-public education. The bill died, and other bills were altered.

The absentees were fined and a bill that raised the amount of money that could be collected from absent legislators was enacted.

Should the Democrats return, the numbers are in Republican's favor with a 60-40 majority in the House and a supermajority of 37-13 in the senate.

Bosma said there would be no fines involved with Wednesday's absences but criticized the Democrats for failing to do the jobs they were elected to do.

If the bill passes, Indiana would become the first right-to-work state in an area considered the country's traditional manufacturing belt.

The bill's sponsor, Republican Indiana State Representative Jerry Torr, has been introducing similar legislation since 2004. He said the bill was about "fairness and freedom" for individual employees to decide whether they want to associate with a union.

Democrats argue that such laws lead to lower wages for all. In an article circulated by Democratic lawmakers, University of Notre Dame professors Barbara Fick and Marty Wolfson argued that trying to attract businesses to a state based on low wages undermines living standards for most workers.

"Most people would agree that lowering wages and benefits for Indiana workers is not the best way to support economic development in Indiana," Fick and Wolfson wrote.

Fick, who teaches law, and Wolfson, who teaches economics, are both affiliated with the Higgins Labor Studies Program at Notre Dame.

ABA head has little sympathy for jobless lawyers

WASHINGTON (iBBC News) - Young lawyers with huge educational debts and no jobs in a depressed U.S. legal market should have known what they were getting into, the president of the American Bar Association said on Wednesday.

William Robinson, in an interview with Reuters at the ABA's office in Washington, D.C., responded to a deluge of recent criticisms from Congress, the media and law students about the role of the trade group in fostering high expectations about legal jobs.

Robinson, a lawyer in Kentucky, said anyone entering law school has already completed an undergraduate degree or more.

"It's inconceivable to me that someone with a college education, or a graduate-level education, would not know before deciding to go to law school that the economy has declined over the last several years and that the job market out there is not as opportune as it might have been five, six, seven, eight years ago," he said.

College graduates are capable of making "an independent decision and a free choice" to go to law school, he said.

"We're not talking about kids who are making these decisions," said Robinson, who is midway through a one-year term as ABA president.

The number of U.S. legal jobs shrank during the recession that began in 2007, tracking the overall job market. Many lawyers have the added burden of six-figure tuition debt.

Critics including two U.S. senators have asked whether the bar association does enough to police law schools, a handful of which face allegations that they inflated statistics about post-graduation employment in order to attract more students.

Robinson said the number of schools in question is "no more than four" out of 200 with ABA accreditation, and he said few lawmakers have expressed interest in the subject. "It hasn't been a groundswell of comment from Congress," he said.

Stories in The New York Times and elsewhere have scrutinized the accreditation process, suggesting some ABA standards, such as encouraging tenure, unnecessarily raise law school costs.

Robinson called such suggestions unfounded.

"None of the studies show that the ABA rules of certification are what's responsible for the cost of legal education," he said. Other factors, such as competition for professors, are driving the increase in cost, he said.

Robinson recalled his own experience paying for law school at the University of Kentucky, where he got a degree in 1971.

"When I was going to law school, and I sold my Corvair to make first-semester tuition and books for $330, a sizeable portion of the faculty had tenure. They had tenure then and they have tenure now," he said.

There are still inexpensive options outside the elite law schools, he said. According to ABA statistics, 68 ABA-accredited law schools have annual tuition at or below $25,000.

Among elite schools that charge double that, the ABA is powerless to hold down costs, he said.

"I should take the lead in telling these schools that they should reduce their tuition to $25,000 a year? No, I don't think I should do that. I don't think it would be purposeful. I don't think it would be meaningful. I don't think it would accomplish anything for me to do that," Robinson said.

He said "it's a complex question as to whether the cost is higher than it should be or is justified."

One start-up school in Tennessee, Lincoln Memorial University's Duncan School of Law, is suing the ABA after the association denied it accreditation last year. The law school wants to be a low-cost option for those from rural Appalachia.

Robinson declined to comment on the case.

After quakes, owner to lower pressure in Ohio well

COLUMBUS, Ohio (iBBC News) — The owner of a northeast Ohio well used to dispose of wastewater from oil and gas drilling plans to remove material from it to help lower its inner pressure following 11 minor earthquakes.

State officials say they believe injecting wastewater near a fault line created enough pressure to cause seismic activity. The latest and largest quake was Saturday in the Youngtown area and registered at magnitude 4.0, which can cause moderate damage.

The Ohio Department of Natural Resources said Wednesday that Northstar Disposal Services LLC is taking 12 holding tanks to the site of the now-shuttered injection well to pump the material into the tanks.

Department spokesman Jason Fallon says he's unsure when the removal will start but seven tanks are already on the site.

The company hasn't returned phone and email messages left after business hours Wednesday.

London 2012 tickets mistakenly oversold: organisers

Organisers of the London 2012 Olympics on Wednesday admitted they had mistakenly oversold tickets for synchronised swimming sessions, leading to thousands being offered tickets to other events.

Some 10,000 tickets were meant to go on offer in the second round of sales for four of the sessions in the aquatics centre but 20,000 were made available due to human error, organisers revealed.

Officials contacted around 3,000 ticket-holders and offered them access to more prestigious events -- including the men's 1,500m athletics final -- that they had previously applied for unsuccessfully.

"As a result of finalising the seating configurations in our venues and reconciling the millions of Olympic and Paralympic ticket orders against the seating plans for around 1,000 sporting sessions, we have discovered an error in seats available in four synchronised swimming sessions," said a London 2012 spokesperson.

"In December we contacted around 3,000 customers who had applied for tickets in the four sessions during the second round sales process and we are exchanging their synchronised swimming tickets for tickets in other sports," added the spokesperson.

The extra tickets will come from a batch of one million contingency tickets that will go on sale in May after seating plans for the venues have been finalised.

Lobbyist latest to admit role in NY bribery scheme

NEW YORK (iBBC News) - A prominent Manhattan lobbyist on Wednesday was the latest person to plead guilty in a federal corruption probe that ensnared a New York state senator.

Richard Lipsky, 64, told federal Judge Jed Rakoff that he funneled payments to former Democratic senator Carl Kruger in order to obtain favors.

"Did you understand... that you were entering into an agreement to, in effect, bribe Mr. Kruger?" the judge asked. "Yes, your honor," an ashen Lipsky responded.

Lipsky pleaded guilty to one count each of conspiracy to commit bribery and bribery. He is scheduled to be sentenced on May 4.

Kruger, 62, resigned last month after pleading guilty to four counts of conspiring to commit fraud and taking bribes.

He and Lipsky were among eight individuals charged last year in connection with a wide-ranging scheme that FBI assistant director-in-charge Janice Fedarcyk called a "web of graft and corruption."

On Tuesday, former Parkway Hospital executive Richard Aquino admitted to his role in the scheme and Manhattan-based gynecologist Michael Turano also previously pleaded guilty.

One of the individuals who sought to bribe Kruger was ex-MediSys CEO David Rosen, who was convicted at trial of conspiring to bribe Kruger.

Former assemblyman William Boyland was acquitted for his role, but was subsequently charged by federal prosecutors in Brooklyn for other corruption-related crimes.

According to court documents, between 2007 and 2011, Kruger received a stream of bribes from lobbyists, developers and industry consultants. In exchange for the payments, Kruger lobbied other elected officials, influenced the awarding of millions of dollars in state development funds and took other official actions to help benefit the bribers, prosecutors said.

Police kill Texas student, 15, armed with pellet gun

McALLEN, Texas (iBBC News) - Police fatally shot a 15-year-old student armed with a pellet gun at a middle school in Brownsville, Texas, on Wednesday after he pointed it at officers, police said.

Brownsville police received a call of a student with a handgun at Cummings Middle School about 8 a.m. local time Wednesday, department spokesman J.J. Trevino said.

The boy, eighth-grader Jaime Gonzalez, aimed at officers after they confronted him in a hallway, police said.

Police ordered Gonzalez to drop the gun, but instead he pointed it at the officers, who shot the boy twice, police said.

"The subject pointed the weapon at officers, which in turn, the officers had to use deadly force," Trevino said.

The gun, a .177-caliber pellet pistol, resembles a Glock semi-automatic handgun, police said.

The student was rushed to a hospital where he was pronounced dead, said Cameron County Justice of the Peace Kip Johnson Hodge.

A preliminary investigation indicated Gonzalez assaulted a student before officers arrived and told witnesses he was going to "engage officers with the weapon," a police news release said.

No other students, school staff or police were injured. Students were evacuated to a nearby high school and classes were dismissed for the day.

The Texas Rangers will assist city and school police in investigating the fatal shooting.

Brownsville is at the southern tip of Texas along the U.S.-Mexico border.

Obama to unveil leaner US military strategy

President Barack Obama will visit the Pentagon on Thursday to unveil a revised US military strategy designed to reflect a more frugal era and a greater focus on potential threats from China, officials said.

The Pentagon's "defense strategic review" is supposed to set out an approach for the US military at a time of fiscal pressures, as the Obama administration prepares for more than $450 billion in defense cuts over the next 10 years.

The review "will guide our budget priorities and decisions going forward," the White House said in a statement Wednesday.

Obama will be joined by Defense Secretary Leon Panetta and General Martin Dempsey, the chairman of the Joint Chiefs of Staff, who have vowed to maintain America's military edge despite planned budget reductions.

In a politically charged election year, US officials have sought to portray the president as taking a careful, deliberate approach to defense spending, with officials insisting any reductions will be informed by the review of strategy by commanders.

The review will call for confronting threats from China and Iran with air and naval power while shifting away from drawn-out counterinsurgency campaigns requiring large ground forces, officials and analysts said.

The strategy, echoing what Panetta and other top officials have said previously, will argue for a smaller, agile force that will expand the military's role in Asia while maintaining a strong naval presence in the Middle East, a defense official, who spoke on condition of anonymity, told AFP.

Under the plan, the American military would be prepared to deny any attempt by Iran to disrupt vital oil routes in the Gulf and to counter any effort by China to dominate international waters in the South China Sea, the official said.

The new strategy is also expected to discard the doctrine that the American military had to be prepared to fight two wars at the same time, an idea long debated inside the Pentagon, officials said.

Instead, the United States would be ready to fight one war while waging a holding operation elsewhere to stave off a second threat.

Before 2001, the Pentagon had prepared to fight two wars simultaneously but commanders faced a shortage of manpower in the conflicts in Afghanistan and Iraq.

UK's Hague visits Myanmar to urge reforms

LONDON (iBBC News) — Britain's William Hague was arriving in Myanmar on Thursday for the first visit by a U.K. foreign secretary since 1955 — a new sign of the Southeast Asian nation's warming relations with the West.

Hague was scheduled to hold talks with Myanmar's president Thein Sein and government ministers in the nation's capital Naypyitaw before meeting with opposition leader and Nobel peace laureate Aung San Suu Kyi in Yangon.

His visit follows a trip by U.S. Secretary of State Hillary Rodham Clinton in November, as Western nations offer cautious support for reforms that have led to the release of some political prisoners and seen Suu Kyi's National League for Democracy rejoin the country's political process ahead of April parliamentary elections.

In a statement, Hague said his trip was intended to encourage the "government to continue on its path of reform, and to gauge what more Britain can do to support that process."

Though the two-day visit signals a shift in relations, Britain won't promise any immediate change in European Union sanctions on arms sales, asset freezes and travel bans — or change a policy that discourages U.K. businesses from trade with Myanmar.

Britain recently pledged 185 million pounds ($289 million) over three years to fund health and education projects — becoming Myanmar's largest bilateral aid donor — but the U.K. channels funds only through non-governmental groups.

Hague will lay out a series of demands for Myanmar's leadership to meet before it considers offering funds direct to the government, or before the EU can lift any sanctions.

"We hope to see the release of all remaining political prisoners, free and fair by-elections, humanitarian access to people in conflict areas and credible steps towards national reconciliation," Hague said.

Sein, a former army officer, has begun some reforms after 50 years of military rule that saw violent crackdowns on pro-democracy activists, the detention of Suu Kyi and international isolation.

Britain believes there are likely between 591 and 1,700 political prisoners held by Myanmar authorities, though poor record keeping and disputes over the status of captives means an accurate figure is difficult to gauge.

Diplomats also acknowledge Britain is wary of the potential for Myanmar's regime, which took office in March and is dominated by a military-proxy political party, to reverse on recent reforms.

"Further steps are needed that will have a lasting impact on human rights and political freedom," Hague said.

UK: Fate of ransom payments to pirates unclear

LONDON (iBBC News) — Too little is known about the fate of millions of dollars in ransom money paid out to Somali pirates and too few hostage takers are being prosecuted, British lawmakers said Thursday in a sharply critical report.

Parliament's Foreign Affairs Select Committee warned that not enough work is being carried out to trace the route of payments, which topped $135 million in 2011, amid worries some money may be making its way into Britain's financial system.

The panel of legislators — which held hearings with defense officials, maritime lawyers and piracy victims — also found that more than eight out of ten suspected pirates captured off the coast of Somalia are released without trial.

"It is unacceptable that 2.6 million square miles (6.7 million square kilometers) of the Indian Ocean has become a no-go area for small vessels, and a dangerous one for commercial shipping. There is a clear need to take decisive action," committee chairman Richard Ottaway said.

Piracy is rife off the coast of Somalia, and ships are regularly hijacked in defiance of the international naval force that patrols the Indian Ocean. Figures released last month by the European Naval Force showed that more than 2,300 crew members had been taken hostage in the area since December 2008, with some 200 still thought to be in captivity.

Ransoms are routinely paid to secure hostages' release, and the lawmakers' panel said that latest figures from NATO show at least $135 million was paid out last year, compared to around $80 million in ransom payments handed to pirates in 2010.

"It is like being in a housing boom, where your estate agent adds on money for the next house in the street that he is selling," ex-marine and maritime lawyer Stephen Askins told lawmakers in a June hearing.

Lawmakers said that British authorities have been "disappointingly slow to take action on financial flows relating to ransom payments," claiming that little is known about those profiting from piracy.

Government officials had appeared uninterested in information from British firms involved in delivering ransoms to pirates, the report said.

Britain's Foreign Office said in a statement it has a "clear and long-standing policy of not making or facilitating substantive concessions to hostage-takers, including the payment of ransoms."

Though no laws prevent the payment of ransoms, Britain counsels firms against doing so "because we believe that making concessions only encourages future kidnaps," it said.

Lawmakers said the principle was laudable, but should not "extend to the point of failing to collect, analyze, and act upon information concerning ransom payments made by British companies or private individuals."

The ministry said action was being taken against those who finance piracy and to gain "improved understanding of the illicit financial flows of piracy."

Foreign Secretary William Hague said piracy off Somalia's cost "had grown into a major international problem, exacerbating the wider challenges we face in helping Somalia recover from conflict and drought."

The committee's report also called on Prime Minister David Cameron to clear up confusion over the use of weapons on British-flagged ships which encounter pirates.

Cameron in October authorized the ships to carry armed guards on some perilous routes, but did not fully explain what rules would apply on the use of lethal force by private security contractors.

"If a private armed guard on board a U.K. flagged vessel sees an armed skiff approaching at high speed, can the guard open fire?," Ottaway said. "The government must provide clearer direction on what is permissible and what is not."

Cameron will host an international conference in London next month aimed at helping Somalia tackle piracy, militancy and its humanitarian crisis.

"We will use the London conference on Somalia to chart a way forward on the future political direction of Somalia, the vital humanitarian effort and the international community's approach to tackling piracy," Hague said in a statement.

Prison bus overturns on New York State Thruway

NEW YORK (iBBC News) - A New York City Department of Correction bus carrying 16 inmates overturned on a state highway on Wednesday, injuring some of the prisoners and staff on board, officials said.

None of the injuries was serious, and all 16 prisoners remained in custody, the city Department of Correction said.

The cause of the mid-morning accident, which occurred on the New York State Thruway northbound near Ramapo, New York, remained under investigation, state police said.

Preliminary reports indicated that the bus, which was carrying three staff members along with 16 inmates, swerved to avoid another vehicle and flipped over onto its side.

The inmates were being returned to the medium-security Ulster Correctional prison after court appearances in New York City, the city Department of Correction said.

The injured staff and inmates were taken to Good Samaritan Hospital in Suffern, New York, the department said.

"Everyone has been treated and released. Well, not the inmates, they're back in prison," said Sharman Stein, a spokeswoman for the Department of Correction.

Sale of "M*A*S*H" hot dog chain falls apart

TOLEDO, Ohio (iBBC News) - The court-supervised sale of a financially troubled Ohio hot dog restaurant chain made famous in the TV series "M*A*S*H" has collapsed after the buyer withdrew his offer, saying a bank suddenly increased the interest on a loan central to the deal.

The complication left the future of Tony Packo's restaurants unclear, though a judge said on Wednesday he was committed to finding a buyer for the five-restaurant chain and keeping it open.

Tony Packo's, in its 80th year, rose to fame in the 1970s when Toledo native Jamie Farr played a Korean War soldier who frequently talked about home and his favorite hot dog on the hit TV show.

Packo's has been under duress since August 2010, when the company's co-owner, Robin Horvath, alleged misappropriation of corporate funds in a lawsuit against his cousin, Tony Packo III, Packo's executive vice president. Packo's then defaulted on a Fifth Third Bank loan and Horvath sued to gain control of the company from co-owner Tony Packo, Jr., Tony III's father.

The case ended up in Lucas County Common Pleas Court, where Judge Gene Zmuda was charged with finding a buyer. Five entities submitted bids, including separate offers from Horvath and the two Packos and one from Bob Bennett's Ohio-based TP Foods LLC.

On December 19, Zmuda approved the sale of Packo's for $5.5 million.

Bennett said the deal fell apart when Fifth Third Bank suddenly increased the interest rate on a $2.6 million loan made to Tony Packo's from 2.5 percent to 6 percent. Bennett had agreed to pay off the loan as part of the purchase price.

Bennett also said Fifth Third wanted to assume control of the deal and told Bennett he would have to regularly report to bank officials, terms he found unacceptable.

"In the end, the management and financial risks of going forward were too great to bear," Bennett said.

A Fifth Third spokesman declined to comment.

New York private detective sentenced for rape, framing

NEW YORK (iBBC News) - A New York private detective was sentenced to 32 years in prison on Wednesday for raping his ex-girlfriend and then framing her for a series of fictional robberies in an elaborate conspiracy that fooled authorities and saw his victim wrongly jailed for seven months.

Jerry Ramrattan, 39, was found guilty in November of rape, conspiracy, witness tampering and falsely reporting incidents stemming from his efforts to frame Seemona Sumasar.

Prosecutors said Ramrattan attacked and raped Sumasar in March 2009 when, although they had broken up, he was living in her basement in New York City's Queens borough.

After he was arrested on rape charges a few days later, Ramrattan, using bribes and threats, convinced three people to pretend they had been pulled over while driving and held up at gunpoint by a man and a woman impersonating police officers, according to the Queens District Attorney's account.

The three people falsely identified Sumasar as the female police officer.

Ramrattan also planted a bullet at the scene of one of the fake robberies, hoping it would discredit her as a witness at his rape trial, prosecutors said.

Based on the three persons' sworn testimonies, grand juries in Queens and in Nassau County, Long Island, indicted Sumasar on charges of first-degree robbery.

Unable to afford bail, she spent more than seven months in jail, separated from her daughter and her restaurant business, which failed in her absence, her attorney said.

Weeks before her trial was due to start, an informant came forward with a tip that she was a victim of an elaborate plot, prosecutors said.

She then testified against Ramrattan at his four-week trial in state Supreme Court in Queens, where he was found guilty in November.

"Today's sentence provides a measure of justice for this victim, who survived a nightmarish rape only to be victimized again when she was arrested on robbery charges and sent to jail," Queens District Attorney Richard Brown said.

Ramrattan has maintained his innocence, claiming he did not rape Sumasar and saying he is the victim of an even larger conspiracy in which he has been framed in the charges of framing her.

Frank Kelly, Ramrattan's attorney, said he would file a notice of appeal.

Sumasar has filed a civil lawsuit against police in Nassau County, who were criticized by Justice Richard Buchter at Wednesday's sentencing, and against New York City for negligence leading to her wrongful imprisonment.

"This is extremely important to her," said Nick Brustin, her attorney in the civil case, "not only to once and for all make clear to the world what happened to her, but also to make sure it doesn't happen to someone else."

Fox News trumps CNN, MSNBC in Iowa Caucus coverage

LOS ANGELES (iBBC News) - Forget Mitt and Rick, Fox News was the Iowa Caucus' big winner.

Fox News was far and away the top rated cable news network during last night's coverage of the early presidential contest...and unlike Mitt Romney's victory over Rick Santorum, it wasn't by eight votes.

Fox more than doubled the ratings of rivals CNN and MSNBC, averaging 2.15 million viewers and 637,000 in the key 25 to 54 demographic for the night, according to Nielsen Media Research.

In contrast, CNN averaged 1 million total viewers and 390,000 viewers in the 25-54 demo. MSNBC averaged 932,000 viewers, with 259,000 coming from the 25-54 demo.

Fox's primetime coverage (8-11 p.m.) was seen by 2.63 million viewers, whereas CNN and MSNBC boasted audiences of 1.31 million and 1.20 million viewers respectively.

Fox, which is widely perceived as right-leaning, benefited from the fact that the Iowa Caucus was focused almost exclusively on a Republican field of presidential aspirants. The network's overall ratings were up 30 percent from 2008's heartland face-off. MSNBC's ratings were up 1 percent and CNN's fell 36 percent.

As the evening wore on -- and the various cable news anchors fell over themselves coming up with variations on "too close to call" -- predictably the audience for all three rivals trickled away.

Fox racked up 1.82 million total viewers during the final four hours of coverage, CNN attracted 839,000 viewers and MSNBC drew 693,000 viewers.

Captured soldier's family hopes for his release

BOISE, Idaho (iBBC News) — The family of the only U.S. soldier held by the Taliban is optimistic about a possible deal that would allow insurgents to open an office in Gulf nation of Qatar with the aim of holding talks with the United States.

Bowe Bergdahl, a 25-year-old Army sergeant from Hailey, Idaho, was taken prisoner June 30, 2009, in Afghanistan.

His parents, Bob and Jani Bergdahl, released a statement Wednesday through the Idaho National Guard expressing hope their son would be returned home safely as soon as possible.

The family says that "serious discussions among diplomats are the most likely way to make this happen."

The Taliban announced Tuesday that they had reached a preliminary understanding to open the representative office in Qatar, marking an unprecedented step toward peace negotiations.

Final Glance: Telecom companies

NEW YORK (iBBC News) — Shares of some top telecom companies were mixed at the close of trading:

AT&T Inc. rose $.05 or .2 percent, to $30.43.

Sprint Nextel fell $.03 or 1.3 percent, to $2.31.

Verizon fell $.52 or 1.3 percent, to $39.21.

Final Glance: Insurers companies

NEW YORK (iBBC News) — Shares of some top insurers companies were mixed at the close of trading:

MBIA fell $.41 or 3.3 percent, to $12.12.

MGIC Investments rose $.21 or 5.8 percent, to $3.80.

XL Grp fell $.46 or 2.3 percent, to $19.72.

Final Glance: Media companies

NEW YORK (iBBC News) — Shares of some top media companies were mixed at the close of trading:

Disney rose $.54 or 1.4 percent, to $38.85.

NY Times fell $.07 or .9 percent, to $7.70.

News Corp. fell $.12 or .6 percent, to $18.55.

TimeWarn rose $.16 or .4 percent, to $36.49.

Viacom rose $.44 or .8 percent, to $53.38.

Final Glance: Oil companies

NEW YORK (iBBC News) — Shares of some top oil companies were mixed at the close of trading:

Chevron fell $.19 or .2 percent, to $110.18.

ConocoPhillips fell $.35 or .5 percent, to $73.82.

Exxon Mobil rose $.02 or percent, to $86.02.

Marathon Oil rose $.07 or .2 percent, to $31.03.

Final Glance: Staffing companies

NEW YORK (iBBC News) — Shares of some top staffing companies were mixed at the close of trading:

Kelly Services unchanged at $14.18.

Korn Ferry fell $.09 or .5 percent, to $17.65.

Manpower rose $.39 or 1.1 percent, to $37.40.

Robert Half fell $.17 or .6 percent, to $28.49.

Final Glance: Durable Goods companies

NEW YORK (iBBC News) — Shares of some top durable goods companies were mixed at the close of trading:

Snap-On fell $.12 or .2 percent, to $51.12.

StanBlkDk rose $.27 or .4 percent, to $70.51.

Whirlpool rose $.46 or .9 percent, to $48.97.

Final Glance: Commercial Banks companies

NEW YORK (iBBC News) — Shares of some top commercial banks companies were up at the close of trading:

First Horizon rose $.09 or 1.1 percent, to $8.32.

Zions Bancorp rose $.38 or 2.2 percent, to $17.14.

Final Glance: Chemicals companies

NEW YORK (iBBC News) — Shares of some top chemicals companies were up at the close of trading:

Dow Chemical rose $.16 or .5 percent, to $29.95.

DuPont rose $.51 or 1.1 percent, to $47.02.

Final Glance: Autos companies

NEW YORK (iBBC News) — Shares of some top autos companies were up at the close of trading:

Ford Motor rose $.17 or 1.5 percent, to $11.30.

Honda Motors rose $.26 or .8 percent, to $31.60.

Toyota Motor rose $.65 or 1.0 percent, to $68.43.

Final Glance: Airlines companies

NEW YORK (iBBC News) — Shares of some top airlines companies were mixed at the close of trading:

vjAMR fell $.05 or 16.1 percent, to $0.24.

DeltaAir fell $.03 or .4 percent, to $8.01.

JetBlue rose $.11 or 2.1 percent, to $5.23.

Southwest rose $.19 or 2.3 percent, to $8.60.

US Airways fell $.09 or 1.8 percent, to $5.03.

UtdContl fell $.38 or 2.0 percent, to $18.52.

German man charged with arson over Los Angeles fires

LOS ANGELES (iBBC News) - A German man accused of setting dozens of fires across Los Angeles over the New Year's holiday weekend that left residents shaken was charged with 37 counts of arson on Wednesday, prosecutors said.

Harry Burkhart, 24, was charged with 28 counts of arson of property and nine counts of arson of an inhabited structure, Los Angeles County District Attorney Steve Cooley said in a statement.

"The complaint also alleges that the arson was caused by use of a device designed to accelerate the fire," Cooley said. "If found true, the allegation could mean additional custody time for the defendant."

Burkhart, a German citizen who according to a law enforcement official was being held under a suicide watch at the Los Angeles County Jail, was expected to make an initial court appearance later on Wednesday.

Earlier, state prosecutors in Germany said Burkhart was suspected of starting a fire that burned down his home in the city of Neukirchen.

"We are investigating against this 24-year-old man because of a fire in the Schwalm-Eder district," German state prosecutor Annemarie Wied said.

"He is accused of serious arson and suspected fraud. In the early hours of October 14, a timbered house went on fire in the Schwalm-Eder district and this person came under suspicion," Wied said.

MOTHER ARRESTED

Burkhart's 53-year-old mother, Dorothee Burkhart, was arrested last week in the Los Angeles area on a provisional warrant issued by German authorities and was facing extradition proceedings.

Dorothee Burkhart, who has been living in a Los Angeles apartment with her son, faces multiple charges of fraud and embezzlement in Germany, according to court documents.

She is accused of failing to pay a surgeon for breast augmentation as well as failing to return security deposits on rental properties she leased and accepting fees and deposits on apartment units she did not own, the court documents show.

The elder Burkhart, also a German citizen, made an initial court appearance in U.S. District Court in Los Angeles on Tuesday. She was apparently unaware that her son had been arrested and asked a judge if the "German Nazis" were responsible for him disappearing.

There was conflicting information on how long Dorothee and Harry Burkhart have lived in the Los Angeles area.

A website for an erotic massage service based in Los Angeles is registered to a Dorothee Burkhart who shares the same address as Harry Burkhart. The site advertises topless but non-sexual sessions by appointment only.

Harry Burkhart was arrested after a tip from a member of the U.S. State Department's Diplomatic Security field office who recognized him from an outburst during his mother's initial court hearing, a state department spokeswoman said.

A man resembling Burkhart was captured on surveillance videotape leaving the scene of several of the fires, which caused no fatalities. One firefighter was injured and another person suffered from smoke inhalation.

One of the fires damaged a house in the Hollywood Hills where late rocker Jim Morrison was inspired to write the 1968 song "Love Street" about his girlfriend.

The Los Angeles City Council voted unanimously on Wednesday to approve an emergency motion allowing expedited permits for property owners looking to rebuild carports and other buildings damaged by the fires.

Survivor of deadly Conn. home invasion is engaged

NEW HAVEN, Conn. (iBBC News) — A Connecticut doctor whose wife and two daughters were killed in a home invasion has become engaged to a woman who volunteered at events organized by the foundation set up to honor their memories.

Family friend Rick Healey said Wednesday that Dr. William Petit became engaged over the weekend to photographer Christine Paluf. There's no wedding date.

The Hartford Courant newspaper first reported the engagement.

Petit was beaten with a baseball bat and tied up in the 2007 invasion at his home in Cheshire, a wealthy New Haven suburb. He escaped to a neighbor's home.

Two men were convicted in the killings of Petit's wife, Jennifer Hawke-Petit, and their daughters, 17-year-old Hayley and 11-year-old Michaela. The men are on death row.

Petit says he's had "occasional moments of peace" since the crime but trial evidence brought back the horror.

Americans expected to buy more cars in 2012

DETROIT (iBBC News) — Strong sales in December capped off a great year for U.S. carmakers — especially Chrysler — and 2012 should be even better.

For their biggest Japanese rivals, a year of natural disasters and other struggles ended on a sour note, with U.S. sales falling and the outlook for next year just as challenging.

Chrysler Group, in the midst of a comeback after its 2009 trip through bankruptcy court, said Wednesday that sales surged 37 percent in December and 26 percent for all of 2011. Demand was particularly strong for the Jeep Grand Cherokee and the Chrysler 200. Chrysler catapulted itself ahead of Honda Motor Co. as the fourth-largest automaker by sales in the U.S.

General Motors Co. and Ford Motor Co. ended the year with more modest double-digit percentage gains. Analysts say U.S. car sales rose for the second year in a row as buyers' confidence in the economy picked up, their aging vehicles wore down and their ability to take out cheap loans improved.

U.S. auto sales rose 10 percent to 12.8 million in 2011. That's up 22 percent from 2009, when the U.S. auto industry and the financial system were in peril.

November and December were the strongest months of the year for U.S. auto sales, and analysts expect the momentum to continue into 2012. Improving employment numbers, low interest rates and building demand to replace older cars should all boost 2012 sales.

GM's December sales rose 5 percent, resulting in a 13 percent bump for the year, while Ford's December sales climbed 10 percent, closing out an 11 percent gain for 2011.

Nissan Motor Co., which recovered more quickly than its rivals from the March earthquake and tsunami in Japan, was the only major Japanese automaker to sell more cars in the U.S. in 2011. Its sales surged nearly 8 percent in December and 15 percent for the year. Nissan's Leaf electric car also outsold GM's Chevrolet Volt in the cars' first full year on the market. Nissan sold 9,674 Leafs, beating the Volt by just over 2,000.

But for Honda and Toyota, 2011 was a disappointing sales year.

They couldn't get enough cars and trucks to U.S. dealers because of Japan's disasters and flooding in Thailand. Toyota said Wednesday that it doesn't expect its inventory to be at normal levels until March.

Both carmakers, whose sales fell 7 percent in 2011, were also hurt by aging offerings like the Toyota Corolla and poor reviews of the new Honda Civic.

While U.S. sales haven't returned to their pre-recession levels, American motorists are increasingly eager to buy, says Jesse Toprak, vice president of analysis for the car pricing site TrueCar.com.

Buyers snapped up more small cars like the Chevrolet Cruze, Hyundai Elantra and Ford Fiesta. And sales of trucks and SUVs picked up as well, a sign that small businesses are updating their aging fleets, something they were reluctant to do during a slow economic recovery.

"They're becoming more comfortable buying a car even though the dust hasn't totally settled," says Toprak.

GM and others predict that total U.S. auto sales will rise by another 1 million or so in 2012 to a range of 13.5 million to 14 million. That's still far below the peak of around 17 million in 2005, but consistent with a slow and steady economic recovery.

Unemployment has declined in the past three months, and hiring is improving. That's helping consumers feel more confident about a big purchase like a car. Low interest rates — below 3 percent, in some cases — are also enticing buyers, says Don Johnson, GM's U.S. sales chief. And with the average age of a car in the U.S. pushing a record 11 years, there is growing demand to replace old cars.

Buyers are coming out even though car prices are relatively high. The average new vehicle cost $30,686 in December, up 5 percent from a year earlier, as automakers offered more pricy features like navigation systems and backup cameras but cut back on rebates and other deals. Incentive spending dropped 3 percent in December from a year earlier to an average of $2,562 per vehicle, according to TrueCar.com.

Many analysts had predicted a price war in 2011 as Toyota and Honda factories resumed normal production and they sought to win customers. But the big discounts never materialized, and GM's Johnson doesn't expect them in 2012, either.

But others think Toyota and Honda will use incentives to try to win back the market share they lost in 2011. Toyota expected to end the year with market share of 12.9 percent, down from 15 percent in 2010.

"I still expect Toyota and Honda to be a little more aggressive in the first half," says Paul Ballew, a former GM chief economist who now works for Nationwide Insurance.

Other automakers reporting Wednesday:

— Volkswagen AG said 2011 sales were up 26 percent on strong sales of the Jetta and Passat sedans. December sales were up 36 percent to 32,502, the company's best December in the U.S. since 1972.

— Hyundai Motor Co. said 2011 sales rose 20 percent on strong demand for the Sonata and Elantra sedans. December sales were up 13 percent.

— Kia Motors Corp. said 2011 sales rose 36 percent on sales of the new Optima, Soul and Sorento. December sales were up 43 percent.

Stirring up a fight, Obama names consumer watchdog

SHAKER HEIGHTS, Ohio (iBBC News) — Defying Republican lawmakers, President Barack Obama on Wednesday barreled by the Senate and installed a national consumer watchdog on his own, provoking GOP threats of a constitutional showdown in the courts. Setting a fierce tone in the election-year fight for middle-class voters, Obama said: "I refuse to take 'no' for an answer."

Obama named Richard Cordray, a respected former attorney general of Ohio, to be the first director of the Consumer Financial Protection Bureau, after giving up on hopes for a confirmation vote in the Senate. The appointment means the agency is able to oversee a vast swath of lending companies and others accused at times of preying on consumers with shady practices.

In political terms, Obama's move was unapologetically brazen, the equivalent of a haymaker at Republicans in the Senate who had blocked his nominee. Acting right after Tuesday's presidential caucuses in Iowa, which showered attention on his opponents, Obama sought to make a splash as the one fighting for the rights of the little guy.

Presidents of both parties long have gotten around a stalled confirmation by naming a nominee to a job when the Senate is on a break through a process known as a recess appointment.

But Obama went further by squeezing in his appointment during a break between rapid Senate sessions this week, an unusual move that the GOP called an arrogant power grab.

The White House said what the Senate was doing — gaveling in and out of session every few days solely to avoid being in recess — was a sham. Obama's aides said the president would not be stopped by a legislative gimmick, even though it was Senate Democrats who began the practice to halt President George W. Bush's appointments.

"When Congress refuses to act, and as a result hurts our economy and puts people at risk, I have an obligation as president to do what I can without them," Obama said from Ohio, a state vital to Obama's re-election bid.

Consumer groups hailed Obama's decision; the U.S. Chamber of Commerce balked and warned it was so legally shaky that consumer bureau's work may be compromised.

The response from Republicans was blistering.

The top Senate Republican, Minority Leader Mitch McConnell, said Obama had "arrogantly circumvented the American people" and endangered the nation's systems of checks and balances. Republican Sen. Orrin Hatch of Utah called it a "very grave decision by this heavy-handed, autocratic White House."

And House Speaker John Boehner, R-Ohio, said: "It's clear the president would rather trample our system of separation of powers than work with Republicans to move the country forward. This action goes beyond the president's authority, and I expect the courts will find the appointment to be illegitimate."

Mitt Romney, a leading Republican presidential candidate, accused Obama of displaying "Chicago-style politics at its worst."

It was not immediately clear who might file a suit on the matter. Most likely, a private party regulated by the consumer agency would have the legal standing.

More than a standoff over one significant appointment, the fight speaks to the heart of a presidential campaign under way.

Obama is presiding over a troubled but improving economy. To try to win over voters, he is employing two strategies: in-your-face politics against a Congress held in low public regard, and a campaign pitch that he would represent the crunched middle class better than any of the Republicans he would face.

The Cordray appointment fits both.

Only with a director in place can the consumer bureau keep "dishonest" mortgage companies, payday lenders, debt collectors and others from harming consumers, Obama said. Speaking from a high school in the Cleveland suburb of Shaker Heights, Obama said Republicans were only blocking Cordray because they wanted to water down consumer protections.

Republican senators have called the consumer bureau too powerful and unaccountable, and held off on Cordray's bid as a means to get changes.

Cordray essentially starts right away, although his nomination will become official later in the week, the White House said. He is expected to serve until at least the end of 2013, which is the end of the Senate's next session.

In plowing ahead, the White House had to contend with some uncomfortable history.

Just last year, a lawyer from Obama's Justice Department said the office's view was that recess appointments could only come during legislative breaks of more than three days. That doesn't match up with what Obama did with Cordray, since the Senate was technically just in session on Tuesday.

The Senate's top Democrat, Harry Reid of Nevada, said in 2007 he would keep the Senate in "pro forma" sessions to block Bush from making an end run around the Senate and the Constitution with controversial nominations. That's exactly what Obama's White House now calls a gimmick. Yet on Wednesday, Reid came out in support of what Obama did.

As a senator in 2005, Obama opposed the recess nomination of John Bolton to be the U.S. ambassador to the United Nations, saying at the time that a representative who couldn't get through a Senate confirmation would be "damaged goods" with less credibility. Obama spokesman Jay Carney said Obama was just talking about the merits of the Bolton pick.

Obama certainly hasn't opposed recess appointments as president.

He had made 28 recess appointments before Wednesday, then named Cordray and three members to the National Labor Relations Board.

Bush made more than 170 such appointments when the Senate was away.

At the heart of the conflict this time is the arcane matter of what, exactly, constitutes a congressional recess.

White House lawyers ultimately determined that, for all practical purposes, the Senate is in the midst of about a monthlong break and Obama can move ahead as he pleases.
 
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