AP survey: US income inequality slows growth; Fed unlikely to taper at meeting this week
WASHINGTON (AP) — The growing gap between the richest Americans and everyone else isn't bad just for individuals.
It's hurting the U.S. economy.
So says a majority of more than three dozen economists surveyed last week by The Associated Press. Their concerns tap into a debate that's intensified as middle-class pay has stagnated while wealthier households have thrived.
A key source of the economists' concern: Higher pay and outsize stock market gains are flowing mainly to affluent Americans. Yet these households spend less of their money than do low- and middle-income consumers who make up most of the population but whose pay is barely rising.
"What you want is a broader spending base," says Scott Brown, chief economist at Raymond James, a financial advisory firm. "You want more people spending money."
The purse-snatcher and NSA's anti-terror surveillance: Is a 1970s Baltimore case relevant?
WASHINGTON (AP) — The small-time case of a Baltimore purse-snatcher who got nabbed after crank-calling his victim in 1976 laid the legal groundwork for today's worldwide government surveillance of telephone records in the name of protecting the U.S. from terrorists.
The Supreme Court eventually heard the case of Michael Lee Smith, ruling that the government was allowed to collect his phone records to tie him to the purse-snatching. And since the Sept. 11 attacks, the National Security Agency has used that case to justify the collection of "metadata" — the duration of calls and the phone numbers used to make and receive them — of hundreds of millions of Americans and foreigners.
But a federal judge and even the prosecutor who pressed for the purse-snatcher's conviction say the government has gone too far. Now, it may well take a new Supreme Court ruling to settle whether the Baltimore case more than three decades ago can apply to global government surveillance.
"To say that a small-time robbery on the street is a precedent for what was then unforeseen and massive electronic surveillance is simply a stretch, to put it mildly," says former Maryland Attorney General Stephen H. Sachs, who defended the government's use of phone records to arrest and convict Smith during an argument in front of the Supreme Court. The court sided with him in a 5-3 ruling in 1979. One justice abstained from the case.
"For present purposes, you have to say that the trapping of information from one suspect is different, for God's sake, than trapping the data of every American who uses a telephone or the Internet," Sachs said in an interview Tuesday. "There's a distinction of volume, of context. But that's what the Supreme Court is going to have to decide."
Snowden: NSA spying 'collapsing' under scrutiny; says he would help Brazil probe US espionage
RIO DE JANEIRO (AP) — National Security Agency leaker Edward Snowden wrote in a lengthy "open letter to the people of Brazil" that he's been inspired by the global debate ignited by his release of thousands of NSA documents and that the agency's culture of indiscriminate global espionage "is collapsing."
In the letter, Snowden commended the Brazilian government for its strong stand against U.S. spying.
He wrote that he'd be willing to help the South American nation investigate NSA spying on its soil, but could not fully participate in doing so without being granted political asylum, because the U.S. "government will continue to interfere with my ability to speak."
Revelations about the NSA's spy programs were first published in the Guardian and The Washington Post newspapers in June, based on some of the thousands of documents Snowden handed over to Barton Gellman at the Post and to Brazil-based American journalist Glenn Greenwald and his reporting partner, Laura Poitras, a U.S. filmmaker.
The documents revealed Brazil is the top NSA target in Latin America, with spying that has included the monitoring of Brazilian President Dilma Rousseff's cellphone and hacking into the internal network of state-run oil company Petrobras.
After 3 days of air raids, casualties overwhelm hospitals in Syria's Aleppo, aid group says
BEIRUT (AP) — Hospitals in the northern Syrian city of Aleppo are overwhelmed with casualties, an international aid group warned Tuesday, as government warplanes blasted opposition areas of the city as part of a withering three-day air assault that has killed more than 100 people.
The intensified air campaign, which one activist group in the city called "unprecedented," suggests President Bashar Assad's government is trying to crush opposition in the contested city, Syria's largest, ahead of an international peace conference scheduled for late January in Switzerland.
Aleppo has been a major front in Syria's civil war since the rebels launched an offensive there in mid-2012, and the city has since been carved into opposition- and government-held areas. On Tuesday, the main Western-backed opposition group, the Syrian National Council, accused the international community of "failing to take any serious position that would guarantee a stop to the bloodbath" ahead of the peace talks.
The Britain-based Syrian Observatory for Human Rights said airstrikes Tuesday killed 15 people, including two children, in the rebel-held Shaar district.
An amateur video posted online showed the aftermath of one of the strikes: rescue workers in white hard hats pulling a man from the rubble of a shattered apartment building. A crowd of people in the street shouted "God is greatest!" as the rescuers rushed the dust-covered man to a waiting ambulance. The video appeared genuine and corresponded to other AP reporting.
Indian official says treatment of arrested diplomat in New York was 'barbaric'
NEW DELHI (AP) — The arrest and alleged strip search of an Indian diplomat in New York City escalated into a major diplomatic furor Tuesday as India's national security adviser called the woman's treatment "despicable and barbaric."
Devyani Khobragade, India's deputy consul general in New York, is accused of submitting false documents to obtain a work visa for her Manhattan housekeeper. Indian officials said she was arrested and handcuffed Thursday as she dropped off her daughter at school, and was kept in a cell with drug addicts before posting $250,000 bail.
A senior Indian official confirmed reports that she also was strip-searched, which has been portrayed in India as the most offensive and troubling part of the arrest. The official spoke to The Associated Press on condition of anonymity because of the sensitivity of the case.
Her U.S. attorney said he didn't know if she was strip-searched. Federal authorities said they were looking into the arrest.
"We understand that this is a sensitive issue for many in India," said Marie Harf, State Department deputy spokeswoman. "Accordingly, we are looking into the intake procedures surrounding this arrest to ensure that all appropriate procedures were followed and every opportunity for courtesy was extended."
Mega Millions jackpot jumps to $636 million, second largest lottery jackpot in US history
DES MOINES, Iowa (AP) — The Mega Millions jackpot has soared to an estimated $636 million for Tuesday night's drawing, making it the second largest lottery jackpot in U.S. history.
The top prize had been estimated at $586 million, but lottery officials increased their prediction Tuesday morning because of strong ticket sales. The jackpot now trails only a $656 million Mega Millions pot that was sold in March 2012.
Mega Millions changed its rules in October to help increase the jackpots by lowering the odds of winning the top prize. That means the chances of winning the jackpot are now about 1 in 259 million.
But that hasn't stopped aspiring multimillionaires from playing the game.
"Oh I think there's absolutely no way I am going to win this lottery," said Tanya Joosten, 39, an educator at the University of Wisconsin-Milwaukee who bought several tickets on Tuesday. "But it's hard for such a small amount of money to not take the chance."
As consumers look closer at food labels, companies quietly remove strange-sounding ingredients
NEW YORK (AP) — Take another look at that food label. An ingredient or two may have vanished.
As Americans pay closer attention to what they eat, food and beverage companies are learning that unfamiliar ingredients can invite criticism from online petitions and bloggers. The risk of damaging publicity has proven serious enough that some manufacturers have reformulated top-selling products to remove mysterious, unpronounceable components that could draw suspicion.
Earlier this year, for example, PepsiCo Inc. said it would stop using brominated vegetable oil in Gatorade and find a another way to evenly distribute color in the sports drink. Last year, Starbucks said it would stop using a red dye made of crushed bugs based on comments it received "through a variety of means," including an online petition, and switch to a tomato-based extract. Kraft Foods plans to replace artificial dyes with colors derived from natural spices in select varieties of its macaroni and cheese, a nod to the feedback it's hearing from parents.
Ali Dibadj, a Bernstein analyst who covers the packaged food and beverage industry, says the changes reflect a shift from "democratization to activism" by consumers.
"It used to be that people would just decide not to buy the product. Now they're actually agitating for change," Dibadj said. "There's a bullhorn — which is the Internet — so you can get a lot of people involved very quickly."
Putin offers Ukraine $15 billion bailout, cheaper gas; Ukrainian protesters oppose the deal
MOSCOW (AP) — Russian President Vladimir Putin on Tuesday opened his wallet in the battle with the European Union over Ukraine's future, saying Moscow will buy $15 billion worth of Ukrainian government bonds and sharply cut the price of natural gas for its economically struggling neighbor.
The announcements came after Putin held talks in Moscow with Ukrainian President Viktor Yanukovych, who is facing massive protests at home for his decision to shelve a pact with the EU in favor of closer ties with Moscow. Russia's bailout package angered protesters, who immediately accused Yanukovych of selling out the country to the Kremlin and pressed demands for his ouster.
Washington said the Kremlin agreements would not address concerns of the demonstrators in Kiev, and German Chancellor Angela Merkel dismissed what she described as a "bidding competition" over Ukraine.
Putin's move came as Ukraine said it desperately needs to get at least $10 billion in the coming months to avoid bankruptcy. The Fitch ratings agency has given Ukraine's bonds a B-minus rating, which puts them in "junk bond" territory.
Putin sought to calm protesters in Kiev by saying he and Yanukovych didn't discuss the prospect of Ukraine joining a Moscow-dominated economic bloc they fear will pull their country closer into Russia's orbit.
NASA orders urgent spacewalk repairs at station, US astronauts will try to fix cooling system
CAPE CANAVERAL, Fla. (AP) — NASA has ordered up a series of urgent spacewalks to fix a broken cooling line at the International Space Station.
Station managers decided Tuesday to send two American astronauts out as soon as possible to replace a pump with a bad valve. It's a major job that will require three spacewalks — Saturday, Monday and next Wednesday on Christmas Day.
"The next week will be busy with space walks so not much tweeting from here," NASA astronaut Rick Mastracchio tweeted from space soon after the decision was announced.
The spacewalks are taking priority over the launch of a supply ship from Virginia. The commercial delivery had been scheduled for this week, but is now delayed until at least mid-January.
Half of the station's cooling system shut down last Wednesday, forcing the six-man crew to turn off all nonessential equipment, including some science experiments. Because of the valve failure, one of the two cooling lines became too cold.
Blind man, guide dog struck by slow-moving train on NYC subway tracks; both stable
NEW YORK (AP) — A blind man and his guide dog were struck by a subway train in Manhattan on Tuesday after the man lost consciousness and they tumbled on to the tracks, but both escaped without serious injury.
Cecil Williams, 61, told The Associated Press from his hospital bed that he was on his way to the dentist during the morning rush hour when he felt faint on the 125th Street platform. His guide dog, a black Labrador named Orlando, is trained to protect him from going over the edge.
"He tried to hold me up," Williams said.
Witnesses said the dog was barking frantically and tried to stop Williams from falling, but they both fell to the tracks when Williams fainted.
The train's motorman slowed the subway cars while witnesses called for help. Williams and Orlando were struck, but not badly hurt.