China village defies officials to demand democracy

SHANGPU, China: Villagers in southern China were locked in a stand-off with authorities on Sunday and were demanding democratic polls after a violent clash with thugs linked to a local official over a land transfer.

Just over a week ago, residents of Shangpu in Guangdong province fought with scores of attackers whom they claimed were sent by the village communist party chief and a business tycoon after they protested against a land deal.

Police are blockading the settlement to outsiders while residents refuse to let officials inside, days before the annual meeting of the country's legislature, the National People's Congress (NPC).

The situation recalls a similar episode in Wukan, also in Guangdong and around 100 kilometres (62 miles) from Shangpu, which made headlines worldwide 15 months ago.

At the main entrance of the village of 3,000 people, 40 police and officials stood guard, barring outside vehicles from entering. Not far away, a cloth banner read: "Strongly request legal, democratic elections."

Shangpu's two-storey houses and low-slung family-run workshops are surrounded by fields awaiting spring planting. But the main street is lined with the wrecks of cars damaged in the clash, with glass and metal littering the ground.

Residents said they should have the right to vote both for the leader who represents them and on whether to approve a controversial proposal to transform rice fields into an industrial zone.

"This should be decided by a vote by villagers," said one of the protest leaders, adding: "The village chief should represent our interests, but he doesn't."

Locals fear that once the NPC -- which starts on Tuesday -- ends, authorities will move in with force.

Chinese leaders have repeatedly ruled out Western-style democracy for the country.

"For the purpose of maintaining stability, they (authorities) don't want to use forceful measures before the meetings," another villager said. "We are afraid of them coming back."

The unidentified attackers, some of whom wore orange hard hats and red armbands, drove into the village and turned on residents with shovels and other weapons.

Villagers drove the interlopers off by hitting them with bamboo poles and throwing bricks from a nearby construction site, according to first-hand accounts and video of the incident provided to AFP.

They said they then vented their fury on the attackers' cars, overturning and smashing as many as 29 vehicles.

Residents claimed some of the group had knives and a gun. A video showed a man firing a handgun into the air and villagers said he was a plainclothes police officer trying to intercede. At least eight villagers were injured.

In Wukan in late 2011, a protest by residents against a land grab by local officials accused of corruption escalated after one of their leaders died in police custody.

Villagers barricaded roads and faced off against security forces for 10 days, until authorities backed down and promised them rare concessions. Residents were later allowed to hold open village elections -- a first in Wukan.

The people of Shangpu had heard of Wukan indirectly, and had similar demands: free elections for their leader.

They claim the current village chief Li Baoyu, who is also the party head, was foisted on them by higher authorities.

Residents allege Li fraudulently obtained signatures to support the transfer of 33 hectares (82 acres) of farmland to the Wanfeng Investment Co, backed by businessman Wu Guicun, to be used for factories producing electrical cables.

The village's ruling committee will receive compensation based on the yield of rice that would have been planted on the land. But residents fear they themselves will not be paid and say the compensation does not reflect the true value.

"Village cadres have illegally dealt in land and leased land at a low price," they said in a petition to higher officials.

In the government's only official statement on the case, Jiexi county, which administers the village, pledged to pursue those responsible for the attack and bring criminal prosecutions.

No one from Wanfeng Investment Co could be reached for comment.

- AFP/xq

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23-year-old questioned in connection with Hyderabad blasts

MUMBAI: The Maharashtra ATS, in a joint operation with the Nampally police in Karnataka, have detained a man in connection with the recent twin blasts in Hyderabad that killed 16 people.

The detainee, Shaikh Aqueel (23), originally a Bhiwandi resident, had shifted to Karnataka some time ago with his parents.

Aqueel's name cropped up while the police was inquiring into several issues including the bomb blast cases.

"Shaikh is currently getting a diploma in fire services. He was detained for his alleged association with the banned outfit, Indian Mujahideen," a source said.

"We don't know what happened or what he said during his interrogation," said a source.

Aqueel was first identified by the ATS and later in a joint operation with the Karnataka police, the ATS picked him up and brought him to its Nanded unit.

"Shaikh was questioned, not arrested," said ATS chief Rakesh Maria.

The ATS had in September busted an IM sleeper cell and arrested four persons who were planning to target fundamentalist Hindu leaders.

During that time, the Karnataka police arrested 11 persons who had some connection with the Nanded group.

The Delhi police a week before that had arrested two persons, Sayyed Maqbool and Imran Khan. The duo have admitted that they did a recee of Dilsukh Nagar, where the twin bombs exploded.

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Man's Body Recovery Effort Ends; Sinkhole 'Unstable'

Authorities have discontinued the rescue effort for a Florida man who was swallowed by a sinkhole when his home's foundation collapsed and said it is unlikely his body will ever be recovered.

"We feel we have done everything we can," Hillsborough County administrator Mike Merrell said at a news conference this afternoon. "At this point, it's not possible to recover the body."

Merell said officials would bring in heavy equipment to begin demolishing the home on Sunday.

"We're dealing with a very unusual sinkhole," he said. "It's very deep. It's very wide. It's very unstable."

Jeff Bush was in his bedroom when a sinkhole opened up and trapped him underneath his home at 11 p.m. Thursday.

Two homes next door to Bush's residence were evacuated today after authorities said they had been compromised by the growing sinkhole.

With the assistance of rescuers, the homeowners will be allowed to enter their home for only 30 minutes to gather valuables, authorities said.

Rescuers returned to the site in Seffner, Fla., early this morning to conduct further testing, but decided it was too dangerous for the family initially affected by the sinkhole to enter their home, which was declared condemned.

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While the sinkhole was initially estimated to be 15 feet deep on Thursday night, the chasm has continued to grow. Officials now estimate it measures 30 feet across and is up to 100 feet deep.

The Hillsborough County Fire Rescue has set up a relief fund for all families affected by the growing sink hole.

MORE: How Sinkholes Can Develop

Rescue operations were halted Friday night after it became too dangerous to approach the home.

Bill Bracken, an engineer with Hillsborough County Urban Search and Rescue team said the house "should have collapsed by now, so it's amazing that it hasn't."

RELATED: Florida Man Swallowed by Sinkhole: Conditions Too Unstable to Approach

Using ground penetrating radar, rescuers have found a large amount of water beneath the house, making conditions even more dangerous for them to continue the search for Bush.

Hillsborough County lies in what is known as Florida's "Sinkhole Alley." More than 500 sinkholes have been reported in the area since 1954, according to the state's environmental agency.

Meanwhile, Bush's brother, Jeremy Bush, is still reeling from Thursday night.

Jeremy Bush had to be rescued by a first responder after jumping into the hole in an attempt to rescue his brother when the home's concrete floor collapsed, but said he couldn't find him.

"I just started digging and started digging and started digging, and the cops showed up and pulled me out of the hole and told me the floor's still falling in," he said.

"These are everyday working people, they're good people," said Deputy Douglas Duvall of the Hillsborough County sheriff's office. "And this was so unexpected, and they're still, you know, probably facing the reality that this is happening."

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3 dead in new Bangladesh war crimes protests: police

CHITTAGONG, Bangladesh: Bangladesh police on Saturday opened fire at Islamists protesting the conviction for war crimes of one of their leaders, killing three people outside the port city of Chittagong.

The deaths brought the total number killed since a war crimes tribunal delivered its first verdict on January 21 to at least 56, according to police figures.

The number includes 40 who have died in the last three days, since Jamaat-e-Islami party vice president Delwar Hossain Sayedee was sentenced to death, police said.

Sayedee was found guilty on Thursday of murder, religious persecution and rape during the 1971 independence war, triggering violent clashes between rampaging Jamaat supporters and police across the country.

The 73-year-old firebrand preacher was the third person to be convicted by the war crimes tribunal, whose verdicts have been met by outrage from Islamists.

The Islamists say the process is more about settling scores than delivering justice.

The latest violence came a day after the United States called for calm in the impoverished South Asian nation.

"While engaging in a peaceful protest is a fundamental democratic right, we believe violence is never the answer," US State Department deputy acting spokesman Patrick Ventrell told reporters in Washington.

But he stressed the United States believes "it is important to bring justice to those who have committed war crimes and atrocities" while ensuring that the trials be "free, fair, transparent".

In the new clashes, police said they fired live rounds after hundreds of student activists of Jamaat barricaded a key highway and attacked officers with stones and sticks as they tried to clear the road.

"We were forced to open fire. Three people were killed in the clashes," senior Chittagong police official Rabiul Islam told AFP, adding 10 people, including policemen, were wounded.

The war crimes trials of a dozen Jamaat and main opposition Bangladesh Nationalist Party (BNP) leaders have opened old wounds and divided the nation.

The opposition has accused the government of staging a witchhunt.

The government, which says the war claimed three million lives, rejects the claims and accuses Jamaat leaders of being part of pro-Pakistani militias blamed for much of the carnage during the 1971 independence war.

Independent estimates put the death toll from the war in which Bangladesh won its independence from Pakistan at a much lower figure of 300,000 to 500,000.

- AFP/ck

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Rajnath lauds Modi as most popular CM

NEW DELHI: Amid calls for a larger role for him, Narendra Modi on Saturday won singular praise from BJP president Rajnath Singh for being the "most popular" chief minister having registered "never before" three consecutive electoral wins for the party in Gujarat.

The BJP national council meeting began here with Singh exhorting the delegates to give a standing ovation to Modi and garlanding him.

"We have never seen the BJP winning three elections under one leadership," Singh said as Modi stepped forward on the dais to accept plaudits from the delegates.

"It won't be proper to welcome Modi with mere words. He deserves a good round of applause, a standing ovation," Singh said.

The BJP chief also lauded chief ministers of Madhya Pradesh and Chhatisgarh Shivraj Singh Chouhan and Raman Singh respectively for leading "successful" governments. He also had words of praise for Goa chief minister Manohar Parrikar, Bihar deputy chief minister Sushilkumar Modi and leader of the BJP legislature party in Punjab, where the party is sharing power with the Akali Dal.

Singh also defended his predecessor Nitin Gadkari, saying the allegations against the former BJP president were completely false and baseless.

Singh accused the UPA government of failure of various counts including in ensuring security, maintaining diplomatic relations, particularly with neighbouring countries, tackling naxalism and handling of the economy and sought to project the BJP as an alternative.

"We haven't seen a strong leadership in the Congress-led UPA," the BJP president said.

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WHO: Slight cancer risk after Japan nuke accident

LONDON (AP) — Two years after Japan's nuclear plant disaster, an international team of experts said Thursday that residents of areas hit by the highest doses of radiation face an increased cancer risk so small it probably won't be detectable.

In fact, experts calculated that increase at about 1 extra percentage point added to a Japanese infant's lifetime cancer risk.

"The additional risk is quite small and will probably be hidden by the noise of other (cancer) risks like people's lifestyle choices and statistical fluctuations," said Richard Wakeford of the University of Manchester, one of the authors of the report. "It's more important not to start smoking than having been in Fukushima."

The report was issued by the World Health Organization, which asked scientists to study the health effects of the disaster in Fukushima, a rural farming region.

On March 11, 2011, an earthquake and tsunami knocked out the Fukushima plant's power and cooling systems, causing meltdowns in three reactors and spewing radiation into the surrounding air, soil and water. The most exposed populations were directly under the plumes of radiation in the most affected communities in Fukushima, which is about 150 miles (240 kilometers) north of Tokyo.

In the report, the highest increases in risk are for people exposed as babies to radiation in the most heavily affected areas. Normally in Japan, the lifetime risk of developing cancer of an organ is about 41 percent for men and 29 percent for women. The new report said that for infants in the most heavily exposed areas, the radiation from Fukushima would add about 1 percentage point to those numbers.

Experts had been particularly worried about a spike in thyroid cancer, since radioactive iodine released in nuclear accidents is absorbed by the thyroid, especially in children. After the Chernobyl disaster, about 6,000 children exposed to radiation later developed thyroid cancer because many drank contaminated milk after the accident.

In Japan, dairy radiation levels were closely monitored, but children are not big milk drinkers there.

The WHO report estimated that women exposed as infants to the most radiation after the Fukushima accident would have a 70 percent higher chance of getting thyroid cancer in their lifetimes. But thyroid cancer is extremely rare and one of the most treatable cancers when caught early. A woman's normal lifetime risk of developing it is about 0.75 percent. That number would rise by 0.5 under the calculated increase for women who got the highest radiation doses as infants.

Wakeford said the increase may be so small it will probably not be observable.

For people beyond the most directly affected areas of Fukushima, Wakeford said the projected cancer risk from the radiation dropped dramatically. "The risks to everyone else were just infinitesimal."

David Brenner of Columbia University in New York, an expert on radiation-induced cancers, said that although the risk to individuals is tiny outside the most contaminated areas, some cancers might still result, at least in theory. But they'd be too rare to be detectable in overall cancer rates, he said.

Brenner said the numerical risk estimates in the WHO report were not surprising. He also said they should be considered imprecise because of the difficulty in determining risk from low doses of radiation. He was not connected with the WHO report.

Some experts said it was surprising that any increase in cancer was even predicted.

"On the basis of the radiation doses people have received, there is no reason to think there would be an increase in cancer in the next 50 years," said Wade Allison, an emeritus professor of physics at Oxford University, who also had no role in developing the new report. "The very small increase in cancers means that it's even less than the risk of crossing the road," he said.

WHO acknowledged in its report that it relied on some assumptions that may have resulted in an overestimate of the radiation dose in the general population.

Gerry Thomas, a professor of molecular pathology at Imperial College London, accused the United Nations health agency of hyping the cancer risk.

"It's understandable that WHO wants to err on the side of caution, but telling the Japanese about a barely significant personal risk may not be helpful," she said.

Thomas said the WHO report used inflated estimates of radiation doses and didn't properly take into account Japan's quick evacuation of people from Fukushima.

"This will fuel fears in Japan that could be more dangerous than the physical effects of radiation," she said, noting that people living under stress have higher rates of heart problems, suicide and mental illness.

In Japan, Norio Kanno, the chief of Iitate village, in one of the regions hardest hit by the disaster, harshly criticized the WHO report on Japanese public television channel NHK, describing it as "totally hypothetical."

Many people who remain in Fukushima still fear long-term health risks from the radiation, and some refuse to let their children play outside or eat locally grown food.

Some restrictions have been lifted on a 12-mile (20-kilometer) zone around the nuclear plant. But large sections of land in the area remain off-limits. Many residents aren't expected to be able to return to their homes for years.

Kanno accused the report's authors of exaggerating the cancer risk and stoking fear among residents.

"I'm enraged," he said.

___

Mari Yamaguchi in Tokyo and AP Science Writer Malcolm Ritter in New York contributed to this report.

__

Online:

WHO report: http://bit.ly/YDCXcb

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Obama Signs Order to Begin Sequester Cuts

President Obama and congressional leaders today failed to reach a breakthrough to avert a sweeping package of automatic spending cuts, setting into motion $85 billion of across-the-board belt-tightening that neither had wanted to see.

President Obama officially initiated the cuts with an order to agencies Friday evening.

He had met for just over an hour at the White House Friday morning with Republican leaders House Speaker John Boehner and Senate Minority Leader Mitch McConnell and his Democratic allies, House Minority Leader Nancy Pelosi, Senate Majority Leader Harry Reid and Vice President Joe Biden.

But the parties emerged from their first face-to-face meeting of the year resigned to see the cuts take hold at midnight.

"This is not a win for anybody," Obama lamented in a statement to reporters after the meeting. "This is a loss for the American people."

READ MORE: 6 Questions (and Answers) About the Sequester

Officials have said the spending reductions immediately take effect Saturday but that the pain from reduced government services and furloughs of tens of thousands of federal employees would be felt gradually in the weeks ahead.

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Federal agencies, including Homeland Security, the Pentagon, Internal Revenue Service and the Department of Education, have all prepared to notify employees that they will have to take one unpaid day off per week through the end of the year.

The staffing trims could slow many government services, including airport screenings, air traffic control, and law enforcement investigations and prosecutions. Spending on education programs and health services for low-income families will also get clipped.

"It is absolutely true that this is not going to precipitate the crisis" that would have been caused by the so-called fiscal cliff, Obama said. "But people are going to be hurt. The economy will not grow as quickly as it would have. Unemployment will not go down as quickly as it would have. And there are lives behind that. And it's real."

The sticking point in the debate over the automatic cuts -- known as sequester -- has remained the same between the parties for more than a year since the cuts were first proposed: whether to include more new tax revenue in a broad deficit reduction plan.

The White House insists there must be higher tax revenue, through elimination of tax loopholes and deductions that benefit wealthier Americans and corporations. Republicans seek an approach of spending cuts only, with an emphasis on entitlement programs. It's a deep divide that both sides have proven unable to bridge.

"This discussion about revenue, in my view, is over," Boehner told reporters after the meeting. "It's about taking on the spending problem here in Washington."

Boehner: No New Taxes to Avert Sequester

Boehner says any elimination of tax loopholes or deductions should be part of a broader tax code overhaul aimed at lowering rates overall, not to offset spending cuts in the sequester.

Obama countered today that he's willing to "take on the problem where it exists, on entitlements, and do some things that my own party doesn't like."

But he says Republicans must be willing to eliminate some tax loopholes as part of a deal.

"They refuse to budge on closing a single wasteful loophole to help reduce the deficit," Obama said. "We can and must replace these cuts with a more balanced approach that asks something from everybody."

Can anything more be done by either side to reach a middle ground?

The president today claimed he's done all he can. "I am not a dictator, I'm the president," Obama said.

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Bertelsmann buys out KKR in music rights business BMG

FRANKFURT: German media giant Bertelsmann said Friday it has agreed to buy out the US investment fund KKR in their jointly-owned music rights management company BMG for an undisclosed sum.

Bertelsmann said in a statement it will acquire the 51-percent stake that KKR has held in BMG since 2009, finally bringing the unit back under full ownership.

BMG was originally set up in 2008 and KKR acquired its 51-percent stake in 2009.

According to the Financial Times last week, the estimated cost of the deal is around 500 million euros ($654 million).

The deal is still subject to regulatory approval, but is scheduled to close "during the first half of this year," the statement said.

Bertelsmann said BMG manages the rights to more than one million songs, including works by such artists as Bruno Mars, Duran Duran, Gossip, Johnny Cash, and Will.i.am.

It also represents the master rights -- composition and recording -- of artists such as Brian Ferry, Nena and Anastacia.

"This is a great day for Bertelsmann. We are bringing the music home to our group. We are happy to have BMG as our own company again," said Bertelsmann chief executive Thomas Rabe.

Rabe said KKR had been a good partner, but taking full ownership of BMG was "an important step in putting Bertelsmann's growth strategy into practice," Rabe said.

-AFP/sb

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Home minister Shinde 'deeply shocked' at Bhandara rapes

NEW DELHI: Expressing shock at the kidnapping, gang-rape and killing of three minor sisters in Maharashtra last month, home minister Sushilkumar Shinde on Friday said police in the state was making every effort to nab the perpetrators.

"I am deeply shocked that three minor girls from same family were brutally murdered after being sexually abused and their bodies thrown in a well in a village in Maharashtra's Bhandara district," Shinde told Rajya Sabha in a statement.

Shinde said the girls went missing on February 14 and their bodies were found three days later.

"The in-charge of the police station was suspended for not seriously taking the report of missing girls. Several teams have been formed to pursue different line of investigation," he said.

Shinde said efforts were on to nab the perpetrators.

The three sisters, aged between 11 and six, went missing on February 14, Valentine's Day, after attending school. Two days later, their brutalized bodies were found in a well.

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WHO: Slight cancer risk after Japan nuke accident

LONDON (AP) — Two years after Japan's nuclear plant disaster, an international team of experts said Thursday that residents of areas hit by the highest doses of radiation face an increased cancer risk so small it probably won't be detectable.

In fact, experts calculated that increase at about 1 extra percentage point added to a Japanese infant's lifetime cancer risk.

"The additional risk is quite small and will probably be hidden by the noise of other (cancer) risks like people's lifestyle choices and statistical fluctuations," said Richard Wakeford of the University of Manchester, one of the authors of the report. "It's more important not to start smoking than having been in Fukushima."

The report was issued by the World Health Organization, which asked scientists to study the health effects of the disaster in Fukushima, a rural farming region.

On March 11, 2011, an earthquake and tsunami knocked out the Fukushima plant's power and cooling systems, causing meltdowns in three reactors and spewing radiation into the surrounding air, soil and water. The most exposed populations were directly under the plumes of radiation in the most affected communities in Fukushima, which is about 150 miles (240 kilometers) north of Tokyo.

In the report, the highest increases in risk are for people exposed as babies to radiation in the most heavily affected areas. Normally in Japan, the lifetime risk of developing cancer of an organ is about 41 percent for men and 29 percent for women. The new report said that for infants in the most heavily exposed areas, the radiation from Fukushima would add about 1 percentage point to those numbers.

Experts had been particularly worried about a spike in thyroid cancer, since radioactive iodine released in nuclear accidents is absorbed by the thyroid, especially in children. After the Chernobyl disaster, about 6,000 children exposed to radiation later developed thyroid cancer because many drank contaminated milk after the accident.

In Japan, dairy radiation levels were closely monitored, but children are not big milk drinkers there.

The WHO report estimated that women exposed as infants to the most radiation after the Fukushima accident would have a 70 percent higher chance of getting thyroid cancer in their lifetimes. But thyroid cancer is extremely rare and one of the most treatable cancers when caught early. A woman's normal lifetime risk of developing it is about 0.75 percent. That number would rise by 0.5 under the calculated increase for women who got the highest radiation doses as infants.

Wakeford said the increase may be so small it will probably not be observable.

For people beyond the most directly affected areas of Fukushima, Wakeford said the projected cancer risk from the radiation dropped dramatically. "The risks to everyone else were just infinitesimal."

David Brenner of Columbia University in New York, an expert on radiation-induced cancers, said that although the risk to individuals is tiny outside the most contaminated areas, some cancers might still result, at least in theory. But they'd be too rare to be detectable in overall cancer rates, he said.

Brenner said the numerical risk estimates in the WHO report were not surprising. He also said they should be considered imprecise because of the difficulty in determining risk from low doses of radiation. He was not connected with the WHO report.

Some experts said it was surprising that any increase in cancer was even predicted.

"On the basis of the radiation doses people have received, there is no reason to think there would be an increase in cancer in the next 50 years," said Wade Allison, an emeritus professor of physics at Oxford University, who also had no role in developing the new report. "The very small increase in cancers means that it's even less than the risk of crossing the road," he said.

WHO acknowledged in its report that it relied on some assumptions that may have resulted in an overestimate of the radiation dose in the general population.

Gerry Thomas, a professor of molecular pathology at Imperial College London, accused the United Nations health agency of hyping the cancer risk.

"It's understandable that WHO wants to err on the side of caution, but telling the Japanese about a barely significant personal risk may not be helpful," she said.

Thomas said the WHO report used inflated estimates of radiation doses and didn't properly take into account Japan's quick evacuation of people from Fukushima.

"This will fuel fears in Japan that could be more dangerous than the physical effects of radiation," she said, noting that people living under stress have higher rates of heart problems, suicide and mental illness.

In Japan, Norio Kanno, the chief of Iitate village, in one of the regions hardest hit by the disaster, harshly criticized the WHO report on Japanese public television channel NHK, describing it as "totally hypothetical."

Many people who remain in Fukushima still fear long-term health risks from the radiation, and some refuse to let their children play outside or eat locally grown food.

Some restrictions have been lifted on a 12-mile (20-kilometer) zone around the nuclear plant. But large sections of land in the area remain off-limits. Many residents aren't expected to be able to return to their homes for years.

Kanno accused the report's authors of exaggerating the cancer risk and stoking fear among residents.

"I'm enraged," he said.

___

Mari Yamaguchi in Tokyo and AP Science Writer Malcolm Ritter in New York contributed to this report.

__

Online:

WHO report: http://bit.ly/YDCXcb

Read More..

Sequestration: Surrender is in the Air

The budget ax is about to fall, and there's little lawmakers in Washington are doing to stop it.

Despite a parade of dire warnings from the White House, an $85 billion package of deep automatic spending cuts appears poised to take effect at the stroke of midnight on Friday.

The cuts – known in Washington-speak as the sequester – will hit every federal budget, from defense to education, and even the president's own staff.

On Capitol Hill, Senate Democrats and Republicans each staged votes Thursday aimed at substituting the indiscriminate across-the-board cuts with more sensible ones. Democrats also called for including new tax revenue in the mix. Both measures failed.

Lleaders on both sides publicly conceded that the effort was largely for show, with little chance the opposing chamber would embrace the other's plan. They will discuss their differences with President Obama at the White House on Friday.

"It isn't a plan at all, it's a gimmick," Senate Minority Leader Mitch McConnell, R-Ky., said today of the Democrats' legislation.

"Republicans call the plan flexibility" in how the cuts are made, said Senate Majority Leader Harry Reid. "Let's call it what it is. It is a punt."

The budget crisis is the product of a longstanding failure of Congress and the White House to compromise on plans for deficit reduction. The sequester itself, enacted in late 2011, was intended to be so unpalatable as to help force a deal.

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Republicans and Democrats, however, remain gridlocked over the issue of taxes.

Obama has mandated that any steps to offset the automatic cuts must include new tax revenue through the elimination of loopholes and deductions. House Speaker John Boehner and the GOP insist the approach should be spending cuts-only, modifying the package to make it more reasonable.

"Do we want to close loopholes? We sure do. But if we are going to do tax reform, it should focus on creating jobs, not funding more government," House Speaker John Boehner said, explaining his opposition to Obama's plan.

Boehner, McConnell, Reid and House Minority Leader Nancy Pelosi will huddle with Obama at the White House on Friday for the first face-to-face meeting of the group this year.

"There are no preconditions to a meeting like this," White House spokesman Jay Carney said today. "The immediate purpose of the meeting is to discuss the imminent sequester deadline and to avert it."

Even if the leaders reach a deal, there's almost no chance a compromise could be enacted before the deadline. Lawmakers are expected to recess later today for a long weekend in their districts.

What will be the short-term impact of the automatic cuts?

Officials say it will be a gradual, "rolling impact" with limited visible impact across the country in the first few weeks that the cuts are allowed to stand.

Over the long term, however, the Congressional Budget Office and independent economic analysts have warned sequester could lead to economic contraction and possibly a recession.

"This is going to be a big hit on the economy," Obama said Wednesday night.

"It means that you have fewer customers with money in their pockets ready to buy your goods and services. It means that the global economy will be weaker," he said. "And the worst part of it is, it's entirely unnecessary."

Both sides say that if the cuts take effect, the next best chance for a resolution could come next month when the parties need to enact a new federal budget. Government funding runs out on March 27, raising the specter of a federal shutdown if they still can't reach a deal.

"As we anticipate an across-the-board budget cuts across our land, we still expect to see your goodness prevail, O God, " Senate Chaplain Barry Black prayed on the Senate floor this morning, "and save us from ourselves."

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Low-key departure as pope steps down and hides away

VATICAN CITY (Reuters) - Pope Benedict slips quietly from the world stage on Thursday after a private last goodbye to his cardinals and a short flight to a country palace to enter the final phase of his life "hidden from the world".

In keeping with his shy and modest ways, there will be no public ceremony to mark the first papal resignation in six centuries and no solemn declaration ending his nearly eight-year reign at the head of the world's largest church.

His last public appearance will be a short greeting to residents and well-wishers at Castel Gandolfo, the papal summer residence south of Rome, in the late afternoon after his 15-minute helicopter hop from the Vatican.

When the resignation becomes official at 8 p.m. Rome time (02.00 p.m. EST), Benedict will be relaxing inside the 17th century palace. Swiss Guards on duty at the main gate to indicate the pope's presence within will simply quit their posts and return to Rome to await their next pontiff.

Avoiding any special ceremony, Benedict used his weekly general audience on Wednesday to bid an emotional farewell to more than 150,000 people who packed St Peter's Square to cheer for him and wave signs of support.

With a slight smile, his often stern-looking face seemed content and relaxed as he acknowledged the loud applause from the crowd.

"Thank you, I am very moved," he said in Italian. His unusually personal remarks included an admission that "there were moments ... when the seas were rough and the wind blew against us and it seemed that the Lord was sleeping".

CARDINALS PREPARE THE FUTURE

Once the chair of St Peter is vacant, cardinals who have assembled from around the world for Benedict's farewell will begin planning the closed-door conclave that will elect his successor.

One of the first questions facing these "princes of the Church" is when the 115 cardinal electors should enter the Sistine Chapel for the voting. They will hold a first meeting on Friday but a decision may not come until next week.

The Vatican seems to be aiming for an election by mid-March so the new pope can be installed in office before Palm Sunday on March 24 and lead the Holy Week services that culminate in Easter on the following Sunday.

In the meantime, the cardinals will hold daily consultations at the Vatican at which they discuss issues facing the Church, get to know each other better and size up potential candidates for the 2,000-year-old post of pope.

There are no official candidates, no open campaigning and no clear front runner for the job. Cardinals tipped as favorites by Vatican watchers include Brazil's Odilo Scherer, Canadian Marc Ouellet, Ghanaian Peter Turkson, Italy's Angelo Scola and Timothy Dolan of the United States.

BENEDICT'S PLANS

Benedict, a bookish man who did not seek the papacy and did not enjoy the global glare it brought, proved to be an energetic teacher of Catholic doctrine but a poor manager of the Curia, the Vatican bureaucracy that became mired in scandal during his reign.

He leaves his successor a top secret report on rivalries and scandals within the Curia, prompted by leaks of internal files last year that documented the problems hidden behind the Vatican's thick walls and the Church's traditional secrecy.

After about two months at Castel Gandolfo, Benedict plans to move into a refurbished convent in the Vatican Gardens, where he will live out his life in prayer and study, "hidden to the world", as he put it.

Having both a retired and a serving pope at the same time proved such a novelty that the Vatican took nearly two weeks to decide his title and form of clerical dress.

He will be known as the "pope emeritus," wear a simple white cassock rather than his white papal clothes and retire his famous red "shoes of the fisherman," a symbol of the blood of the early Christian martyrs, for more pedestrian brown ones.

(Reporting By Tom Heneghan; editing by Philip Pullella and Giles Elgood)

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Sony sells Tokyo office building for US$1.2b

TOKYO: Sony said on Thursday it has sold one of its main buildings in Tokyo for US$1.2 billion as the embattled Japanese electronics giant offloads assets to help repair its tattered balance sheet.

The news comes after the company in January announced the sale of its US headquarters in Manhattan for more than US$1.0 billion while this month it also sold part of its online medical services unit.

Sony said its had sold the 25-storey central Tokyo building, which houses its television unit, to Nippon Building Fund and an unnamed Japanese institutional investor for 111 billion yen (US$1.2 billion) and would earn it a profit of 41 billion yen.

"Sony is transforming its business portfolio and reorganising its assets in an effort to strengthen its corporate structure," the company said in a statement. "This sale was conducted as a part of this reorganisation."

Sony said it would remain in the central Tokyo building for five years under a leasing agreement.

Earlier this month, the firm said it would book a US$1.2-billion gain from selling part of an online medical services unit, as it eyes a full-year profit after four years in the red.

Sony has announced a massive corporate overhaul that includes thousands of job cuts, the sale of a chemical division and an investment in Olympus to tap the camera and medical equipment maker's strong foothold in the global market for endoscopes.

The maker of Bravia televisions and PlayStation games consoles lost 456.66 billion yen in the last fiscal year, but says it is on track for a 20-billion-yen net profit in the year to March.

Last week, Sony announced it would launch its PlayStation 4 system as it faces increasing competition from cheap -- or sometimes free -- downloadable video games for smartphones and tablets.

The company's hard times saw its stock value tumble below 1,000 yen a share last year, for the first time since the era of the Walkman.

The stock has since come back, with Sony shares up 3.56 per cent at 1,338 yen on Thursday in Tokyo.

Japan's electronics sector has suffered a myriad of problems, including a strong yen, slowing demand in key export markets, fierce competition especially in the struggling TV division and strategic mistakes.

The industry has been awash in huge losses and credit rating downgrades, with rival Sharp saying last year it would put up real estate as collateral for bank loans -- including its Osaka headquarters -- to stay afloat.

- AFP/xq

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Landslide victory for Left in Tripura, Cong to retain power in Meghalaya

AGARTALA: Tripura's ruling Communist Party of India-Marxist (CPI-M) led Left Front was Thursday heading for a landslide victory and set to retain power for a fifth straight term.

In a virtual status quo, the ruling formations were ahead and appeared to be romping back to power in the assembly elections in Tripura, Nagaland and Meghalaya where counting of votes was taken up on Thursday.
TRIPURA

PARTY	LEADS	WINS
CONGRESS	5	5
CPM	13	35
CPI	1	1

MEGHALAYA

PARTY	LEADS	WINS
CONGRESS	26	2
UDP	4	2
NCP	2	0
National People's Party	2	0
Hill state People's Democratic party	4	0
Others	11	0

NAGALAND

PARTY	LEADS	WINS
CONGRESS	3	1
Janata Dal(United)	1	0
NPF	10	20
NCP	2	2
Rashtriya Janata Dal	1	0
Others	5	3

The Left Front government is set to come back to power for the fifth consecutive term in Tripura with leader of the coalition CPM leading in 32 of the 60 seats while its ally CPI was ahead in one.

Congress was a poor second leading only in four seats and others in one in the trends available so far.

In Meghalaya, the ruling Congress-UDP coalition is ahead in 14 of the 60 seats. Congress was ahead in 9 and its alliance partner UDP in 5.

Nagaland also continued with the same trend of favouring the ruling combination.

The Naga Peoples Front (NPF) was ahead in 15 seats while the Congress was ahead in 4, JD(U) 1 and others 2 in the 60-member assembly.

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Medicare paid $5.1B for poor nursing home care

SAN FRANCISCO (AP) — Medicare paid billions in taxpayer dollars to nursing homes nationwide that were not meeting basic requirements to look after their residents, government investigators have found.

The report, released Thursday by the Department of Health and Human Services' inspector general, said Medicare paid about $5.1 billion for patients to stay in skilled nursing facilities that failed to meet federal quality of care rules in 2009, in some cases resulting in dangerous and neglectful conditions.

One out of every three times patients wound up in nursing homes that year, they landed in facilities that failed to follow basic care requirements laid out by the federal agency that administers Medicare, investigators estimated.

By law, nursing homes need to write up care plans specially tailored for each resident, so doctors, nurses, therapists and all other caregivers are on the same page about how to help residents reach the highest possible levels of physical, mental and psychological well-being.

Not only are residents often going without the crucial help they need, but the government could be spending taxpayer money on facilities that could endanger people's health, the report concluded. The findings come as concerns about health care quality and cost are garnering heightened attention as the Obama administration implements the nation's sweeping health care overhaul.

"These findings raise concerns about what Medicare is paying for," the report said.

Investigators estimate that in one out of five stays, patients' health problems weren't addressed in the care plans, falling far short of government directives. For example, one home made no plans to monitor a patient's use of two anti-psychotic drugs and one depression medication, even though the drugs could have serious side effects.

In other cases, residents got therapy they didn't need, which the report said was in the nursing homes' financial interest because they would be reimbursed at a higher rate by Medicare.

In one example, a patient kept getting physical and occupational therapy even though the care plan said all the health goals had been met, the report said.

The Office of Inspector General's report was based on medical records from 190 patient visits to nursing homes in 42 states that lasted at least three weeks, which investigators said gave them a statistically valid sample of Medicare beneficiaries' experiences in skilled nursing facilities.

That sample represents about 1.1 million patient visits to nursing homes nationwide in 2009, the most recent year for which data was available, according to the review.

Overall, the review raises questions about whether the system is allowing homes to get paid for poor quality services that may be harming residents, investigators said, and recommended that the Centers for Medicare & Medicaid Services tie payments to homes' abilities to meet basic care requirements. The report also recommended that the agency strengthen its regulations and ramp up its oversight. The review did not name individual homes, nor did it estimate the number of patients who had been mistreated, but instead looked at the overall number of stays in which problems arose.

In response, the agency agreed that it should consider tying Medicare reimbursements to homes' provision of good care. CMS also said in written comments that it is reviewing its own regulations to improve enforcement at the homes.

"Medicare has made significant changes to the way we pay providers thanks to the health care law, to reward better quality care," Medicare spokesman Brian Cook said in a statement to AP. "We are taking steps to make sure these facilities have the resources to improve the quality of their care, and make sure Medicare is paying for the quality of care that beneficiaries are entitled to."

CMS hires state-level agencies to survey the homes and make sure they are complying with federal law, and can require correction plans, deny payment or end a contract with a home if major deficiencies come to light. The agency also said it would follow up on potential enforcement at the homes featured in the report.

Greg Crist, a Washington-based spokeswoman for the American Health Care Association, which represents the largest share of skilled nursing facilities nationwide, said overall nursing home operators are well regulated and follow federal guidelines but added that he could not fully comment on the report's conclusions without having had the chance to read it.

"Our members begin every treatment with the individual's personal health needs at the forefront. This is a hands-on process, involving doctors and even family members in an effort to enhance the health outcome of the patient," Crist said.

Virginia Fichera, who has relatives in two nursing homes in New York, said she would welcome a greater push for accountability at skilled nursing facilities.

"Once you're in a nursing home, if things don't go right, you're really a prisoner," said Fichera, a retired professor in Sterling, NY. "As a concerned relative, you just want to know the care is good, and if there are problems, why they are happening and when they'll be fixed."

Once residents are ready to go back home or transfer to another facility, federal law also requires that the homes write special plans to make sure patients are safely discharged.

Investigators found the homes didn't always do what was needed to ensure a smooth transition.

In nearly one-third of cases, facilities also did not provide enough information when the patient moved to another setting, the report found.

___

On the Web:

The OIG report: http://1.usa.gov/VaztQm

The Medicare nursing home database: http://www.medicare.gov/NursingHomeCompare/search.aspx?bhcp=1&AspxAutoDetectCookieSupport=1

___

Follow Garance Burke on Twitter at —http://twitter.com/garanceburke.

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Arias Prosecutor Too Combative, Experts Say

He has barked, yelled, been sarcastic and demanded answers from accused murderer Jodi Arias this week.

And in doing so, prosecutor Juan Martinez and his aggressive antics may be turning off the jury he is hoping to convince that Arias killed her ex-boyfriend Travis Alexander in June 2008, experts told ABCNews.com today.

"Martinez is his own worst enemy," Mel McDonald, a prominent Phoenix defense attorney and former judge, told ABC News. "He takes it to the point where it's ad nauseam. You have difficulty recognizing when he's driving the point home because he's always angry and pushy and pacing around the courtroom. He loses the effectiveness, rather than build it up."

"He's like a rabid dog and believes you've got to go to everybody's throat," he said.

"If they convict her and give her death, they do it in spite of Juan, not because of him," McDonald added.

Martinez's needling style was on display again today as he pestered Arias to admit that she willingly participated in kinky sex with Alexander, though she previously testified that she only succumbed to his erotic fantasies to please him.

Arias, now 32, and Alexander, who was 27 at the time of his death, dated for a year and continued to sleep together for another year following their break-up.

Arias drove to his house in Mesa, Ariz., in June 2008, had sex with him, they took nude photos together and she killed him in his shower. She claims it was in self-defense. If convicted, Arias could face the death penalty.

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Martinez also attempted to point out inconsistencies in her story of the killing, bickering with her over details about her journey from Yreka, Calif., to Mesa, Ariz., including why she borrowed gas cans from an ex-boyfriend, when she allegedly took naps and got lost while driving, and why she spontaneously decided to visit Alexander at his home in Mesa for a sexual liaison.

"I want to know what you're talking about," Arias said to Martinez at one point.

"No, I'm asking you," he yelled.

Later, he bellowed, "Am I asking you if you're telling the truth?"

"I don't know," Arias said, firing back at him. "Are you?"

During three days of cross examining Arias this week, Martinez has spent hours going back and forth with the defendant over word choice, her memory, and her answers to his questions.

"Everyone who takes witness stand for defense is an enemy," McDonald said. "He prides himself on being able to work by rarely referring to his notes, but what he's giving up in that is that there's so much time he wastes on stupid comments. A lot of what I've heard is utterly objectionable."

Martinez's behavior has spurred frequent objections of "witness badgering" from Arias' attorney Kirk Nurmi, who at one point Tuesday stood up in court and appealed to the judge to have a conference with all of the attorneys before questioning continued. Judge Sherry Stephens at one point admonished Martinez and Arias for speaking over one another.

Andy Hill, a former spokesperson for the Phoenix police department, and Steven Pitt, a forensic psychiatrist who has testified as an expert witness at many trials in the Phoenix area, both said that despite his aggressive style, Martinez would likely succeed in obtaining a guilty verdict.

"When it comes to cross examination, one size does not fit all," said Pitt. "But if you set aside the incessant sparring, what the prosecutor I believe is effectively doing is pointing out the various inconsistencies in the defendant's version of events."

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Australian cyclone crossing Western Australian coast

SYDNEY: A tropical cyclone hit Australia's resource-rich northwest coast Wednesday, bringing winds of up to 165 kilometres (102 miles) an hour as it crossed the shore near the tiny community of Pardoo.

Severe tropical cyclone Rusty had been sitting offshore for several days, slowly intensifying as it edged towards the Pilbara coast and bringing heavy rain and gale-force winds to the iron ore region.

"It is in the process of crossing," Neil Bennett from Australia's Bureau of Meteorology told AFP just after 0700 GMT, adding it was too soon to say whether it had caused any damage.

"Wind gusts in excess of 165 kilometres an hour are in that area."

Bennett said the storm had been downgraded from a category 4 storm, just one notch short of the top category, to a category 3.

The bureau had expected Rusty to make landfall close to Port Hedland, 1,300 kilometres (800 miles) north of Perth, but Bennett said the major iron ore port appeared to have escaped the full brunt of the storm.

"It looks as if Hedland has dodged the bullet, so to speak, because the worst of the winds are away from Hedland," he said.

"Hedland though has been experiencing a constant period of gale-force winds for over 36 hours now. And that's unprecedented (for that area)."

While the storm has been downgraded, its eye has also contracted from being about 80 kilometres wide on Tuesday to about 50 kilometres by the time it crossed land.

Authorities had warned residents to move out of the storm's path or seek shelter. Resident Ian Badger said he was seeking refuge at the Pardoo Roadhouse, about 120 kilometres from Port Hedland.

"It's just a matter of hanging on," he told the Australian Broadcasting Corporation.

"The amount of water that's around is a bit worrying. The ground is very sodden, very soft. As soon as you get a get a bit of strong wind, trees start going over."

The weather bureau expects the cyclone to move slowly in a south-southeasterly direction, gradually downgrading to a category 1 storm by Thursday afternoon and a tropical low the following day.

Australia's major iron ore export ports have been shut for several days anticipating Rusty's approach. Hundreds of people have been forced to evacuate their homes in the sparsely populated but cyclone-prone area.

Global iron ore giants including BHP Billiton, Rio Tinto and Fortescue Metals Group have all shut down or scaled back operations due to the storm.

-AFP/fl

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Ruckus in Rajya Sabha over alleged tapping of Arun Jaitley's phone

NEW DELHI: The issue of the alleged tapping of the phone of Rajya Sabha leader of opposition Arun Jaitley created a ruckus in the upper House on Wednesday morning.

Rajya Sabha chairman M Hamid Ansari was forced to adjourn the House briefly.

As soon as the House met for the day, Samajwadi Party leader Naresh Agarwal stood up and raised the issue.

"It is a matter of concern that the leader of opposition's phone is being tapped, we need an answer from the home minister," Agarwal said.

He was joined by members of the Bharatiya Janata Party (BJP), Bahujan Samaj Party (BSP), Janata Dal (United) and AIADMK.

Ravishankar Prasad of BJP, Satish Chandra Misra of BSP, AIADMK's V Maitreyan, and Shivanand Tiwari of JD(U) were among those who stood up demanding a clarification from the government on the issue.

Minister of state for parliamentary affairs Rajiv Shukla then assured them that the home minister would inform the house on the issue. The agitated members, however, were not pacified by this and sought a timeframe for the government's response.

Members sought to know if the government was involved in the phone tapping, to which Shukla responded: "The government does not do such things."

This led to uproar from the opposition benches which forced the chairman to order a brief adjournment.

When the House reassembled after the five-minute adjournment, home minister Sushilkumar Shinde said he would collect information on the matter and place it before the House soon.

"Government is bound to make a statement on this," Shinde said.

With that, the proceedings of the House continued smoothly and question hour was taken up.

The Delhi Police has arrested Anurag Singh, a doctor-turned-private detective, who runs V-Detect Private Detective Agency in New Delhi. He is believed to be the brain behind the move to acquire Jaitley's phone call details.

Anurag Singh is also one of the main accused in the tapping of the phone of former Samajwadi Party leader Amar Singh.

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Inside Organized Retail Crime Raids

We used to call it shoplifting, but these days the foot soldiers of retail crime rings are known as boosters. Police even have an acronym for these operations: ORC, which stands for Organized Retail Crime.

"It's just like a Fortune 500 company," said Sergeant Eric Lee of the Gardena Police Department in Gardena, Calif. "All of this is just organized."

Watch the full story on "Nightline" TONIGHT at 12:35 a.m. ET

Police say big retail stores, from Walgreens to J.C. Penny, are getting hit by highly sophisticated shoplifting networks that steal and resell everything from underwear to razors to milk. According to the National Retail Federation, theft can amount to annual losses as high as a $37 billion for retail businesses.

"Every store in every city has to go through this," Lee said. "They wait until no one's paying attention and they walk out."

Tide detergent is currently a hot target because it is compact, expensive and easy to sell on the streets for profit, police said. The Street name: "liquid gold."

"Sometimes we get rings that just do alcohol," Lee said. "And then we get some that do just meat and seafood."

Investigators say boosters move the loot for cents on the dollar to fencing operations -- the black market resellers of the stolen goods -- which sell the stolen merchandise in plain sight in stores. Boosters, fencers, Mr. Bigs, all of those involved in these shoplifting operations can potentially make millions a year from boosting and re-selling stolen goods.

Craigslist Crackdown: Cops Go After Thieves Watch Video

And Mike Swett is on the case. A former Riverside County sheriff's deputy in Los Angeles, Swett was badly injured in a car wreck and now works as a full-time private investigator on the ORC beat who has worked with Target, Marshalls, T.J. Maxx. Stores hire him to do his own undercover police work, catching thieves before involving local law enforcement.

"Kind of like working a narcotics case, it's like you've got low-level, mid-level and then top dog," Swett said. "We like to go after the top dog and the only way to get to the top dog is mid-level first."

At his command center -- his apartment -- Swett showed off the boxes upon boxes of tapes and photographs he has collected, the fruits of countless silent stake-out hours.

Swett said he has been casing two joints in L.A. for months, both alleged to be mid-level fencing operations. "Nightline" was invited to ride along with him when he sent undercover agents in for a final reconnaissance mission.

At some stores and shopping malls, clerks do little to stop shoplifters and often let them run, which has contributed to the growing fencing operations.

"[The stores] don't want their employees to get injured," Swett said. "So oftentimes they will call the police, but by the time we get there they are already in their car and they are gone."

This leaves professional investigators like Swett to put the pieces together and bust open the gangs to lead over-stretched police departments to the prey.

When raid day arrived, a motorcade of squad cars departed from the Gardena, Calif., police department and pulled up to one fencing operation. Swett said the merchandise being sold was boosted goods.

"There is Victoria's Secret, expensive Victoria's Secret, the gift sets," he said, pointing down a line of tables. "J.C. Penny, Miramax, its real stuff not counterfeit."

He spotted a bottle of Katy Perry brand perfume, which usually retails for around $90 but one seller had it priced at $59.

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Italy faces stalemate after election shock

ROME (Reuters) - Italy faced political deadlock on Tuesday after a stunning election that saw the anti-establishment 5-Star Movement of comic Beppe Grillo become the strongest party in the country but left no group with a clear majority in parliament.

"The winner is: Ingovernability" was the headline in Rome newspaper Il Messaggero, reflecting the stalemate the country would have to confront in the next few weeks as sworn enemies would be forced to work together to form a government.

The center-left coalition led by Pier Luigi Bersani won the lower house by around 125,000 votes, where it will have a majority because of a premium given to the largest party or coalition.

Results in the upper house Senate indicated the center-left would end up with about 119 seats, compared with 117 for the center-right. Seats are awarded on a region-by-region basis in the Senate, where a majority of 158 is needed to govern.

Any coalition must have a working majority in both houses in order to pass legislation.

Bersani claimed victory but said it was obvious that Italy was in "a very delicate situation".

Neither Grillo, a comedian-turned-politician who previously ruled out any alliance with another party, nor Silvio Berlusconi's center-right bloc, which threatened to challenge the close tally, showed any immediate willingness to negotiate.

Commentators said all of Grillo's adversaries had underestimated the appeal of a grassroots movement that called itself a "non-party", particularly its allure among young Italians who find themselves without jobs and the prospect of a decent future.

The 5-star Movement's score of 25.5 percent in the lower house was just ahead of the 25.4 percent for Bersani's Democratic Party, which ran in a coalition with the leftist SEL party, and it won almost 8.7 million votes overall - more than any other single party.

FRUSTRATED GENERATION

"The 'non-party' has become the largest party in the country," said Massimo Giannini, commentator for the Rome newspaper La Repubblica.

World financial markets reacted nervously to the prospect of a government stalemate in the euro zone's third-largest economy with memories still fresh of the financial crisis that took the 17-member currency bloc to the brink of collapse in 2011.

The euro skidded to an almost seven-week low against the dollar in Asia on fears about the euro zone's debt crisis. It fell as far as $1.3042, its lowest since January 10.

A first indication of investors' reaction to the results will come later on Tuesday when the Treasury auctions 8.75 billion euros in 6-month bonds.

Italy's borrowing costs have come down in recent months, helped by the promise of European Central Bank support but the election result confirmed fears of many European countries that it would not produce a government strong enough to implement effective reforms.

Grillo's surge in the final weeks of the campaign threw the race open, with hundreds of thousands turning up at his rallies to hear him lay into targets ranging from corrupt politicians and bankers to German Chancellor Angela Merkel.

In just three years, his 5-Star Movement, heavily backed by a frustrated generation of young Italians increasingly shut out from permanent full-time jobs, has grown from a marginal group to one of the most talked about political forces in Europe.

"The 5-Star Movement is the real winner of the election," said SEL leader Nichi Vendola, who said that his coalition would have to deal with Grillo, who mixes fierce attacks on corruption with policies ranging from clean energy to free Internet.

RECESSION

"It's a classic result. Typically Italian," said Roberta Federica, a 36-year-old office worker in Rome. "It means the country is not united. It is an expression of a country that does not work. I knew this would happen."

A long recession and growing disillusionment with mainstream parties fed a bitter public mood that saw more than half of Italian voters back parties that rejected the austerity policies pursued by Prime Minister Mario Monti with the backing of Italy's European partners.

Monti suffered a major setback. His centrist grouping won only 10.6 percent and two of his key centrist allies, Pier Ferdinando Casini and lower house speaker Gianfranco Fini, both of parliamentarians for decades, were booted out.

"It's not that surprising if you consider how much delusion there was with politics in its traditional forms," Monti said.

Berlusconi's campaign, mixing sweeping tax cut pledges with relentless attacks on Monti and Merkel, echoed many of the themes pushed by Grillo and underlined the increasingly angry mood of the Italian electorate.

Stefano Zamagni, an economics professor at Bologna University said the result showed that a significant share of Italians "are fed up with following the austerity line of Germany and its northern allies".

"These people voted to stick one up to Merkel and austerity," he said.

Even if the next government turns away from the tax hikes and spending cuts brought in by Monti, it will struggle to revive an economy that has scarcely grown in two decades.

Monti was widely credited with tightening Italy's public finances and restoring its international credibility after the scandal-plagued Berlusconi, whom he replaced as the 2011 financial crisis threatened to spin out of control.

But he struggled to pass the kind of structural reforms needed to improve competitiveness and lay the foundations for a return to economic growth, and a weak center-left government may not find it any easier.

(Writing by Philip Pullella; Additional reporting by Barry Moody, Gavin Jones, Catherine Hornby and Naomi O'Leary; Editing by Pravin Char)

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Asian markets mostly slip on Italy uncertainty

HONG KONG: Asian markets mostly fell on Tuesday, with dealers spooked by an election in Italy that left no clear winner, leading to political uncertainty and fresh fears about eurozone stability.

The dollar and euro extended the losses suffered in US trade as investors absorbed the Italian results, while there was also concern about the lack of progress in Washington to avoid spending cuts due to take effect on Friday.

Tokyo tumbled 2.26 percent, or 263.71 points, to 11,398.81, with profit-takers also moving in after the index enjoyed a big surge on Monday.

Sydney shed 1.03 percent, or 52.2 points, to 5,003.6, and Seoul lost 0.47 percent, or 9.51 points, to close at 2,000.01.

Shanghai tumbled 1.40 percent, or 32.48 points, to 2,293.34, while Hong Kong fell 1.32 percent, or 300.39 points, to 22,519.69.

Italy Tuesday looked headed for political deadlock as results from Sunday's election indicated there would be no clear winner, while the biggest gainer was a protest party run by a popular comedian.

The polls show that while the leftists won the lower house, the party run by former prime minister Silvio Berlusconi had more seats in the upper house.

Investors fear the outcome will lead to political stalemate in the country and a possible return to the dark days of the region's financial crisis if austerity measures introduced to cut Rome's huge debt pile are reversed.

The developments in Italy sent a shiver through forex markets in New York, with the euro tumbling to $1.3065 and 120.12 yen.

In Asia, the single currency sat at $1.3045 and 119.70 yen, well down from the $1.3197 and 124.24 yen in Tokyo on Monday.

The dollar fetched 91.76 yen against 91.92 yen in New York, far off the 94.77 yen high seen Monday in Asia.

The split vote in Italy wiped out the yen's Monday losses that were fuelled by reports Japan's government is likely to nominate a man to run the central bank who is in favour of more aggressive monetary easing.

On Wall Street, the Dow tumbled 1.55 percent in its biggest single-day drop since November, while the S&P 500 dived 1.83 percent and the Nasdaq sank 1.44 percent.

Traders are also keeping an eye on US lawmakers to see if they can muster an agreement to avoid the imposition of $85 billion in budget cuts -- known as the sequester -- that will come in on Friday.

Analysts have warned that if less drastic cuts are not agreed, the still-fragile economy could slip back into recession.

Oil prices fell, with New York's main contract, light sweet crude for delivery in April, dropping 85 cents to $92.26 a barrel in the afternoon and Brent North Sea crude for delivery in April shedding 85 cents to $113.59.

Gold was at $1,593.60 at 0805 GMT compared with $1,593.30 late Monday.

In other markets:

-- Taipei fell 0.84 percent, or 66.78 points, to 7,880.9.

Taiwan Semiconductor Manufacturing Co shed 1.43 percent to NT$103.5 while leading smartphone maker HTC was 0.36 percent higher at NT$276.5.

-- Manila closed 1.35 percent lower, giving up 90.66 points to 6,630.67.

SM Investments shed 1.37 percent to 1,010 pesos and Ayala Corp. fell 1.02 percent to 584 pesos, while SM Prime Holdings slid 1.60 percent to 18.50 pesos.

-- Wellington closed 0.30 percent, or 12.47 points, higher at 4,238.92.

Telecom rose 1.1 percent to NZ$2.32, Sky City added 0.5 percent to NZ$4.10 and Air New Zealand was up 4.7 percent at NZ$1.33.

- AFP/xq

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Koop, who transformed surgeon general post, dies

With his striking beard and starched uniform, former Surgeon General Dr. C. Everett Koop became one of the most recognizable figures of the Reagan era — and one of the most unexpectedly enduring.

His nomination in 1981 met a wall of opposition from women's groups and liberal politicians, who complained President Ronald Reagan selected Koop, a pediatric surgeon and evangelical Christian from Philadelphia, only because of his conservative views, especially his staunch opposition to abortion.

Soon, though, he was a hero to AIDS activists, who chanted "Koop, Koop" at his appearances but booed other officials. And when he left his post in 1989, he left behind a landscape where AIDS was a top research and educational priority, smoking was considered a public health hazard, and access to abortion remained largely intact.

Koop, who turned his once-obscure post into a bully pulpit for seven years during the Reagan and George H.W. Bush administrations and who surprised both ends of the political spectrum by setting aside his conservative personal views on issues such as homosexuality and abortion to keep his focus sharply medical, died Monday at his home in Hanover, N.H. He was 96.

An assistant at Koop's Dartmouth College institute, Susan Wills, confirmed his death but didn't disclose its cause.

Dr. Richard Carmona, who served as surgeon general a decade ago under President George W. Bush, said Koop was a mentor to him and preached the importance of staying true to the science even if it made politicians uncomfortable.

"He set the bar high for all who followed in his footsteps," Carmona said.

Although the surgeon general has no real authority to set government policy, Koop described himself as "the health conscience of the country" and said modestly just before leaving his post that "my only influence was through moral suasion."

A former pipe smoker, Koop carried out a crusade to end smoking in the United States; his goal had been to do so by 2000. He said cigarettes were as addictive as heroin and cocaine. And he shocked his conservative supporters when he endorsed condoms and sex education to stop the spread of AIDS.

Chris Collins, a vice president of amFAR, the Foundation for AIDS Research, said many people don't realize what an important role Koop played in the beginning of the AIDS epidemic.

"At the time, he really changed the national conversation, and he showed real courage in pursuing the duties of his job," Collins said.

Even after leaving office, Koop continued to promote public health causes, from preventing childhood accidents to better training for doctors.

"I will use the written word, the spoken word and whatever I can in the electronic media to deliver health messages to this country as long as people will listen," he promised.

In 1996, he rapped Republican presidential hopeful Bob Dole for suggesting that tobacco was not invariably addictive, saying Dole's comments "either exposed his abysmal lack of knowledge of nicotine addiction or his blind support of the tobacco industry."

Although Koop eventually won wide respect with his blend of old-fashioned values, pragmatism and empathy, his nomination met staunch opposition.

Foes noted that Koop traveled the country in 1979 and 1980 giving speeches that predicted a progression "from liberalized abortion to infanticide to passive euthanasia to active euthanasia, indeed to the very beginnings of the political climate that led to Auschwitz, Dachau and Belsen."

But Koop, a devout Presbyterian, was confirmed after he told a Senate panel he would not use the surgeon general's post to promote his religious ideology. He kept his word.

In 1986, he issued a frank report on AIDS, urging the use of condoms for "safe sex" and advocating sex education as early as third grade.

He also maneuvered around uncooperative Reagan administration officials in 1988 to send an educational AIDS pamphlet to more than 100 million U.S. households, the largest public health mailing ever.

Koop personally opposed homosexuality and believed sex should be saved for marriage. But he insisted that Americans, especially young people, must not die because they were deprived of explicit information about how HIV was transmitted.

Koop further angered conservatives by refusing to issue a report requested by the Reagan White House, saying he could not find enough scientific evidence to determine whether abortion has harmful psychological effects on women.

Koop maintained his personal opposition to abortion, however. After he left office, he told medical students it violated their Hippocratic oath. In 2009, he wrote to Senate Majority Leader Harry Reid, urging that health care legislation include a provision to ensure doctors and medical students would not be forced to perform abortions. The letter briefly set off a security scare because it was hand delivered.

Koop served as chairman of the National Safe Kids Campaign and as an adviser to President Bill Clinton's health care reform plan.

At a congressional hearing in 2007, Koop spoke about political pressure on the surgeon general post. He said Reagan was pressed to fire him every day, but Reagan would not interfere.

Koop, worried that medicine had lost old-fashioned caring and personal relationships between doctors and patients, opened his institute at Dartmouth to teach medical students basic values and ethics. He also was a part-owner of a short-lived venture, drkoop.com, to provide consumer health care information via the Internet.

Koop was born in the New York City borough of Brooklyn, the only son of a Manhattan banker and the nephew of a doctor. He said by age 5 he knew he wanted to be a surgeon and at age 13 he practiced his skills on neighborhood cats.

He attended Dartmouth, where he received the nickname Chick, short for "chicken Koop." It stuck for life.

Koop received his medical degree at Cornell Medical College, choosing pediatric surgery because so few surgeons practiced it.

In 1938, he married Elizabeth Flanagan, the daughter of a Connecticut doctor. They had four children, one of whom died in a mountain climbing accident when he was 20.

Koop was appointed surgeon-in-chief at Children's Hospital in Philadelphia and served as a professor at the University of Pennsylvania School of Medicine.

He pioneered surgery on newborns and successfully separated three sets of conjoined twins. He won national acclaim by reconstructing the chest of a baby born with the heart outside the body.

Although raised as a Baptist, he was drawn to a Presbyterian church near the hospital, where he developed an abiding faith. He began praying at the bedside of his young patients — ignoring the snickers of some of his colleagues.

Koop's wife died in 2007, and he married Cora Hogue in 2010.

He was by far the best-known surgeon general and for decades afterward was still a recognized personality.

"I was walking down the street with him one time" about five years ago, recalled Dr. George Wohlreich, director of the College of Physicians of Philadelphia, a medical society with which Koop had longstanding ties. "People were yelling out, 'There goes Dr. Koop!' You'd have thought he was a rock star."

___

Ring reported from Montpelier, Vt. Cass reported from Washington. AP Medical Writers Lauran Neergaard in Washington and Mike Stobbe in New York contributed to this report.

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Americans Targeted for Allegedly Running Underage Prostitution in Philippines

Arthur Benjamin is sitting at the edge of a small stage, wearing a lavender Hawaiian shirt and nursing a bottle of San Miguel Light beer. The 6-foot-6 mustachioed Texan lazily watches the half dozen or so girls dancing rather unenergetically around the stage's pole.

"I forgot your gift again, it's in the car," Benjamin says to one of the girls on stage, shouting above the pop music blaring from the speaker system.

The small, dingy bar, which Benjamin says he owns, is called Crow Bar. It's in a rundown part of the picturesque Subic Bay in the western Philippines, about a three hour drive from the capital, Manila. Home for 50 years to a United States naval base, Subic Bay has become synonymous with foreigners looking for sex in the long string of bars that line the main road along the coast.

Watch the full story on "Nightline" TONIGHT at 12:35 a.m. ET

The bars in this area are often packed with older foreign men ogling the young Filipina women available for the night for a "bar fine" of around 1,500 Filipino pesos, or just over $35. Many of the bars are owned and operated by Americans, often former military servicemen who either served on the base or whose ships docked here until the base was shuttered under political pressure in 1992.

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Most of the prostitutes working in the bars are indeed 18 or older. But in the Philippines, just a small scratch to the surface can reveal a layer of young, underage girls who have mostly come from impoverished rural provinces to sell their bodies to help support their families.

Benjamin, 49, is, according to his own statements, one of the countless foreigners who has moved beyond just having sex with underage girls to owning and operating a bar where girls in scantily-clad outfits flaunt their bodies for patrons.

"My wife recently found out that I have this place," he tells an ABC News "Nightline" team, unaware they are journalists and recording the conversation on tiny hidden cameras disguised as shirt buttons.

Benjamin said that a "disgruntled waitress" had written his wife on Facebook, detailing his activities in Subic Bay.

"She sent her this thing saying that I have underage girls who stayed with me, that I [have anal sex with them], I own a bar, I've got other girls that I'm putting through high school, all this other crap," he said.

"All of which is true," he laughed. "However, I have to deny."

He sends a text message summoning his current girlfriend, a petite dark-skinned girl called Jade, who he said is just 16 years old. Benjamin says he bought the bar for her about a year ago and while most still call it Crow Bar, he officially re-named it with her last name.

"She needed a place to stay, I needed a place to do her. I bought a bar for her," he says, explaining that she lives in a house out back by the beach.

"You're not going to find anything like this in the States, not as a guy my age," he said as he looked down at Jade. "Ain't going to happen."

Benjamin is the latest target of Father Shay Cullen, a Catholic priest with a thick Irish brogue and fluency in the local language, Tagalog. Through his non-profit center called Preda, he's been crusading against underage sex trafficking in the Philippines for 40 years.

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Cuban leader Raul Castro says he will retire in 2018

HAVANA (Reuters) - Cuban President Raul Castro announced on Sunday he will step down from power after his second term ends in 2018, and the new parliament named a 52-year-old rising star to become his first vice president and most visible successor.

"This will be my last term," Castro, 81, said shortly after the National Assembly elected him to a second five-year tenure.

In a surprise move, the new parliament also named Miguel Diaz-Canel as first vice president, meaning he would take over if Castro cannot serve his full term.

Diaz-Canel is a member of the political bureau who rose through the Communist Party ranks in the provinces to become the most visible possible successor to Castro.

Raul Castro starts his second term immediately, leaving him free to retire in 2018, aged 86.

Former President Fidel Castro joined the National Assembly meeting on Sunday, in a rare public appearance. Since falling ill in 2006 and ceding the presidency to his brother, the elder Castro, 86, has given up official positions except as a deputy in the National Assembly.

The new government will almost certainly be the last headed up by the Castro brothers and their generation of leaders who have ruled Cuba since they swept down from the mountains in the 1959 revolution.

Cubans and foreign governments were keenly watching whether any new, younger faces appeared among the Council of State members, in particular its first vice president and five vice presidents.

Their hopes were partially fulfilled with Diaz-Canel's ascension. He replaces former first vice president, Jose Machado Ventura, 82, who will continue as one of five vice presidents.

Commander of the Revolution Ramiro Valdes, 80, and Gladys Bejerano, 66, the comptroller general, were also re-elected as vice presidents.

Two other newcomers, Mercedes Lopez Acea, 48, first secretary of the Havana communist party, and Salvador Valdes Mesa, 64, head of the official labor federation, also earned vice presidential slots.

Esteban Lazo, a 68-year-old former vice president and member of the political bureau of the Communist Party, left his post upon being named president of the National Assembly on Sunday. He replaced Ricardo Alarcon, who served in the job for 20 years.

Six of the Council's top seven members sit on the party's political bureau which is also lead by Castro.

Castro's announcement came as little surprise to Cuban exiles in Miami.

"It's no big news. It would have been big news if he resigned today and called for democratic elections," said Alfredo Duran, a Cuban-American lawyer and moderate exile leader in Miami who supports lifting the U.S. trade embargo against Cuba. "I wasn't worried about him being around after 2018," he added.

The National Assembly meets for just a few weeks each year and delegates its legislative powers between sessions to the 31-member Council of State, which also functions as the executive through the Council of Ministers it appoints.

Eighty percent of the 612 deputies, who were elected in an uncontested vote February 3, were born after the revolution.

EFFORT TO PROMOTE YOUNGER GENERATION

Raul Castro, who officially replaced his ailing brother as president in 2008, has repeatedly said senior leaders should hold office for no more than two five-year terms.

"Although we kept on trying to promote young people to senior positions, life proved that we did not always make the best choice," Castro said at a Communist Party Congress in 2011.

"Today, we are faced with the consequences of not having a reserve of well-trained replacements ... It's really embarrassing that we have not solved this problem in more than half a century."

Speaking on Sunday, Castro hailed the composition of the new Council of State as an example of what he had said needed to be accomplished.

"Of the 31 members, 41.9 percent are women and 38.6 percent are black or of mixed race. The average age is 57 years and 61.3 percent were born after the triumph of the revolution," he said.

The 2011 party summit adopted a more than 300-point plan aimed at updating Cuba's Soviet-style economic system, designed to transform it from one based on collective production and consumption to one where individual effort and reward play a far more important role.

Across-the-board subsidies are being replaced by a comprehensive tax code and targeted welfare.

Raul Castro has encouraged small businesses and cooperatives in retail services, farming, minor manufacturing and retail, and given more autonomy to state companies which still dominate the economy.

The party plan also includes an opening to more foreign investment.

At the same time, Cuba continues to face a U.S. administration bent on restoring democracy and capitalism to the island and questions about the future largess of oil rich Venezuela with strategic ally Hugo Chavez battling cancer.

(Editing by Kieran Murray and Vicki Allen)

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