Obama Urges Congress To Extend Payroll Tax Cut

Barack Obama, President of U.S.

WASHINGTON — President Barack Obama pressured Republicans in Congress on Monday to extend a payroll tax cut, saying the economic recovery is "still fragile" and middle class families need the money.

"My message to Congress is this: Keep your word to the American people and don't raise taxes on them right now. Now's not the time to slam on the brakes. Now's the time to step on the gas," Obama said at the White House. He said despite a decline in the unemployment rate to 8.6 percent in November, "our recovery is still fragile" and the nation's economy could be hurt by economic turbulence in Europe.

The president has been seeking an extension and expansion to the payroll tax cut that will expire at the end of the year. The White House says taxes on the average family would increase by $1,000 if the cuts are not extended.

To make its point, the White House went so far as to put up a countdown clock during spokesman Jay Carney's briefing to show when middle-class taxes would go up "if Congress doesn't act."

Some Republicans in Congress support the extension but the parties have been split on how to pay for it. Obama noted that House Speaker John Boehner, R-Ohio, and Senate Republican Leader Mitch McConnell have expressed support for the extension, adding, "I hope the rest of their Republican colleagues come around."

Brendan Buck, a Boehner spokesman, said there was widespread support for extending the payroll tax cuts but if "the president wants to make progress he should insist that Senate Democrats remove the job-killing small business tax hike from their partisan proposal."

Senate Democrats have rolled out a compromise that would drop Obama's proposal to award the tax cut to employers, bringing the cost of the plan down.

Obama also said for Congress to end its work this year without extending unemployment insurance would be a "terrible mistake" and leave "1.3 million Americans out in the cold."

The White House has called for an extension of benefits that can cover up to 99 weeks for the long-term jobless. State unemployment insurance programs guarantees coverage for six months, but Congress approved additional benefits in 2008. Expiration of those payments would mean an average loss of nearly $300 in weekly income for more than 1 million households in January.

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Islamists seen as winners in Egypt election

Vote Counting in Egypt

(Reuters) - Egypt's ruling military painted a dire picture of the economy on Thursday as election officials delayed releasing results of a landmark parliamentary poll that Islamist parties looked set to win, saying votes were still being counted.

They said first-round results would be declared on Friday, a day when youthful protesters demanding an immediate end to army rule have called a rally in Cairo's Tahrir Square to remember the 42 people killed in clashes with riot police last month.

Egyptians voting freely for the first time since army officers ousted the king in 1952 seem willing to give Islamists a chance. "We tried everyone, why not try Sharia (Islamic law) once?" asked Ramadan Abdel Fattah, 48, a bearded civil servant.

Islamist success at the polls in Egypt, the most populous Arab nation, would reinforce a trend in North Africa, where moderate Islamists now lead governments in Morocco and post-uprising Tunisia after election wins in the last two months.

Parliament, whose exact makeup will be clear only after Egypt's staggered voting process ends in January, may challenge the power of the generals who took over in February after a popular uprising toppled Hosni Mubarak, an ex-air force chief.

The army council, under growing pressure to make way for civilian rule, has said it will keep powers to pick or fire a cabinet. But the head of the Muslim Brotherhood's party said this week the majority in parliament should form a government.

The poll results had been expected on Thursday, but some constituencies had not completed their counts.

In an alarming revelation, an army official said foreign reserves would plunge to $15 billion by the end of January, down from the $22 billion reported by the central bank in October.

Mahmoud Nasr, financial assistant to army chief Field Marshal Mohamed Hussein Tantawi, told a news briefing that a widening budget deficit might force a review of costly subsidies, especially on petrol, to save money.

The economic crunch has forced the Egyptian pound to its lowest level in nearly seven years after tourism and foreign investment collapsed in the turmoil since Mubarak's overthrow.

The world is closely watching the election, keen for stability in Egypt, which has a peace treaty with Israel, owns the Suez Canal linking Europe and Asia, and which in Mubarak's time was an ally in countering Islamist militants in the region.

Washington and its European allies have urged the generals to step aside swiftly and make way for civilian rule.

GAINS FOR ISLAMISTS

Western powers are coming to accept that the advent of democracy in the Arab world may bring Islamists to power, but they also worry that Islamist rule in Egypt might erode social freedoms and threaten Cairo's 1979 peace treaty with Israel.

The Muslim Brotherhood, Egypt's oldest Islamist group, says its new Freedom and Justice Party (FJP) is set to win about 40 percent of seats allocated to party lists in this week's vote, which passed off peacefully, albeit with many irregularities.

FJP officials say the party also leads the race for individual seats that make up a third of the total in the poll.

Al-Nour Party, one of several newly formed ultra-conservative Salafi Islamist groups, said on Thursday that it expects to pick up 20 percent of assembly seats overall.

"In light of the media campaign against us, we believe our results are largely acceptable," said Youssry Hamad, Nour's spokesman. "We are doing as well as the Muslim Brotherhood."

The liberal multi-party Egyptian Bloc has said it is on track to secure about a fifth of votes for party lists.

"For the first time in Egypt we don't see a political intention by the state to forge the elections," said Magdy Abdel Halim, coordinator of an EU-backed group of election monitors.

He said the infractions observed did not affect the legitimacy of a vote held in a "reasonably fair atmosphere."

Egypt's April 6 youth movement, a prime mover in the revolt against Mubarak, said an Islamist win should not cause concern.

"No one should worry about the victory of one list or political current. This is democracy and this great nation will not allow anyone to exploit it again," its Facebook page said.

If the FJP and Nour secure the number of seats they expect, they could combine to form a solid majority bloc, although it is far from certain the Brotherhood would want such an alliance.

Senior FJP official Essam el-Erian said before the vote that

Salafis, who had kept a low profile and shunned politics during Mubarak's 30-year rule, would be "a burden for any coalition."

The FJP might seek other partners, such as the liberal Wafd or the moderate Islamist Wasat Party, set up by ex-Brotherhood members in 1996, although only licensed after Mubarak's fall.

Nour Party spokesman Hamad said solving Egypt's problems might be beyond one party. "We believe a coalition government that comprises all political streams is the best option. The burden is too much after all these years of corruption."

PERILS OF DEMOCRACY

Some Egyptians fear the Muslim Brotherhood might try to impose Islamic curbs on a tourism-dependent country whose 80 million people include a 10 percent Coptic Christian minority.

Ali Khafagi, the leader of the FJP's youth committee, said the Brotherhood's goal was to end corruption and revive the economy. Only a "mad group" would try to ban alcohol or force women to wear headscarves, he said.

The priority of the Brotherhood, which gained trust by aiding the poor under Mubarak, is likely to be economic growth to ease poverty and convince voters they are fit to govern.

Essam Sharaf's outgoing government quit during protests against army rule last month in which 42 people were killed, most near Cairo's Tahrir Square, hub of the anti-Mubarak revolt.

Kamal al-Ganzouri, asked by the army to form a "national salvation government," aims to complete the task in the next day or two, but acknowledged on Wednesday that five presidential candidates had turned down invitations to join his cabinet.

Protesters who returned to Tahrir last month, angered by the military's apparent reluctance to cede power, say the generals should step aside now, instead of appointing a man of the past like Ganzouri, 78, who was a premier for Mubarak in the 1990s.

Mohamed Taha, 46, an accountant who supports the liberal Egyptian Bloc, said the election showed that young activists had failed to present a viable program. "Their revolution was stolen and they are stuck searching for who stole it," he said.

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Military of China denounces U.S.-Australia defense upgrade

Geng Yansheng,

(Reuters) - China's military denounced the United States and Australia on Wednesday for upgrading military ties, warning that such moves could erode trust and fan Cold War-era antagonism.

Chinese Defense Ministry spokesman Geng Yansheng made the warning about a plan unveiled in mid-November by U.S. President Barack Obama and Australian Prime Minister Julia Gillard to form a de facto base in north Australia for up to 2,500 U.S. Marines.

Geng's comments came on the same day Australian Foreign Minister Kevin Rudd was reported as backing the formation of a security pact with India and the United States, another step that could fuel China's worries of being fenced in by wary neighbors.

"Military alliances are a product of history, but we believe any strengthening and expansion of military alliances is an expression of the Cold War mentality," Geng said in answer to a question about the U.S.-Australian announcement, according to a transcript on the ministry's website (www.mod.gov.cn.).

"This is not in keeping with the tide of the era of peace, development and cooperation and does not help to enhance mutual trust and cooperation between countries in the region, and could ultimately harm the common interests of all concerned," he said.

"We hope that the parties concerned will do more that is beneficial to the peace and stability of the Asia-Pacific region, and not the contrary."

But the Chinese spokesman indicated that Beijing was not shunning Washington. Chinese and U.S. defense officials, led by Under Secretary of Defense Michele Flournoy, will hold talks in Beijing next Wednesday, Geng told the briefing.

Earlier this month, Obama told Asia-Pacific leaders that the United States was "here to stay," announced the plans to set up the de facto military base in north Australia and chided China for trying to prevent discussion of its South China Sea territorial disputes at regional forums.

The Chinese Ministry of Defense is the public mouthpiece of the People's Liberation Army (PLA), but foreign reporters are not allowed to attend its briefings.

COOPERATION OR CONFRONTATION?

Although falling short of full-throated condemnation of the U.S.-Australian move, Geng's words were tougher than earlier reaction from China's Foreign Ministry, which said Washington and Canberra should focus on cooperating with Beijing.

Geng said the idea raised by U.S. and Australian officials of advancing "integrated air and sea combat" amounted to "trumpeting confrontation and sacrificing others' security for the sake of one's own security."

Chinese President Hu Jintao has made clear that he wants to avoid repeating the rifts that soured ties with Washington in the first half of 2011. Hu retires from power late next year, when the U.S. is focused on its presidential race, making China's leaders especially reluctant to risk distracting rows.

Beijing is also still licking its wounds from last year, when loud maritime disputes with Japan, Vietnam, the Philippines and other neighbors fanned suspicions about China's intentions.

Chinese military officers have, however, sometimes taken a tougher stance on security worries than civilian officials.

Earlier this week, PLA Major General Luo Yuan, well-known for his hawkish views, warned that Obama's regional push showed that the United States wanted to encircle China.

The comments from Australian Foreign Minister Rudd could also magnify such fears among Chinese observers.

A new trilateral pact bringing in India into a U.S.-Australian security tent was worth exploring because "from little things big things grow," Kevin Rudd said in an interview with the Australian Financial Review newspaper.

"The response from the Indian government has really been quite positive," said Rudd.

The idea of an Australian, Indian and U.S. trilateral security dialogue, in part to counter China's rising might, has been pushed by a trio of think-tanks in all three countries, but has yet to be adopted by any government.

At a briefing in Beijing, Foreign Ministry spokesman Hong Lei did not comment directly on Rudd's statement.

"China hopes that countries in the region will do more to promote regional peace, stability and development," Hong said in answer to a question about the proposal.

India's Foreign Ministry did not comment on Rudd's statement. But Indian analysts said Delhi was likely to be cool on the idea, partly out of reluctance to risk riling China.

"The Indian political establishment has always been wary of the idea of a military alliance," said Uday Bhaskar, the head of the National Maritime Foundation, a New Delhi-based think tank.

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The Largest Pacific Octopus At The National Zoo

Octupas

WASHINGTON -- There's a new giant Pacific octopus at the National Zoo. Sadly, only kids age 5 to 15 can enter The Washington Post's contest to name the new octopus (or else we might have some of our own suggestions).

The giant Pacific octopus is the largest octopus in the world -- it can grow up to 600 pounds; the zoo's new octopus is about the size of a grapefruit now. Giant Pacific octopuses -- the plural of octopus is octopuses, octopi or octopodes, as you like -- are quite intelligent, change color to blend in with their environments and usually live around four years. (Strangely, according to researchers, it's possible that giant Pacific octopuses could live longer if their optic glands were removed.) As the name suggests, the giant Pacific octopus is found in the Pacific -- in the northern part of the ocean, at depths of up to 2,500 feet.

The zoo had another giant Pacific octopus, acquired in 2010, named Octavius. She was about four years old when she died on Nov. 4.

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NATO blunder in the northwest, Islamabad closes the "Khyber Pass"

Pakistani Soldiers

AFP - Pakistan said Saturday it would review all its agreements with Washington and NATO, especially in the diplomatic, military and intelligence, following the worst blunder of Westerners in Pakistan in a decade, which killed 26 soldiers. Following an extraordinary meeting of its main leaders, the Pakistani government has also ordered the Americans to withdraw within 15 days of the Shamsi air base, located in south-western Pakistan, and closed all supply routes for NATO in Afghanistan from its territory. The ministers and heads the largest of the army attended Saturday's meeting of the Committee for the Defence of the Government (DCC) under the chairmanship of Prime Minister Yousuf Raza Gilani, said the latter's office.

"The DCC decided to close with immediate effect logistic supply routes to NATO / ISAF (the NATO force in Afghanistan)," the source said. The vast majority of these supplies arrive by boat to Pakistan in Karachi (south), the country's main port, before being sent to Afghanistan by road. "The DCC has also decided to ask the U.S. to leave within fifteen days of the Shamsi air base" that would be used by the CIA as part of its drone strikes in Pakistani tribal areas bordering Afghanistan. Moreover, "the DCC decided that the government would completely rethink all its programs, activities and cooperation agreements with the United States, NATO and ISAF, including diplomatic, political, military and intelligence" announced Gilani's office.

Pakistan has accused NATO of killing up to 26 Pakistani soldiers in an attack before dawn Saturday in one of the tribal areas, the main rear base for Taliban insurgents and Al Qaeda who regularly attack NATO on Afghan soil. According to Islamabad, NATO helicopters bombed a Pakistani military post Baize, in the tribal district of Khyber. "They killed 26 soldiers and wounded 14," he told AFP Masood Kausar, the governor of KPK, Northwest Province of Pakistan, before paying tribute to the "martyrs". In the evening, a spokesman for ISAF, General German Carsten Jacobson, said Afghan forces and NATO operating in the Afghan province of Kunar called for air support had and it was " very likely that the air support (...) has caused losses "in Pakistan.

The officer assured that ground troops were now near the Pakistani border. Denouncing "a serious breach Pakistan's sovereignty and a violation of international law", Prime Minister Yousuf Raza Gilani has protested "in the strongest terms" with NATO and the United States, who lead the ISAF , providing the two-thirds of his troops. Gilani interrupted his weekend to return to Islamabad and talks with President Asif Ali Zardari and the leaders of the powerful army which has denounced an attack "deliberate" and "unacceptable." The Information Minister Firdous Ashiq Awan for his part believed that the attack would strengthen the anti-American sentiment among his compatriots.

The U.S. ambassador in Islamabad Cameron Munter, meanwhile, said his country would work "closely with Islamabad to investigate this incident." Pakistan has repeatedly criticized in recent years for violations of its airspace by ISAF. The latest crisis began in September 2010. Islamabad had then accused the force of killing three Pakistani soldiers and blocked the supply trucks of NATO for almost two weeks, until Washington apologizes. The United States regularly bombed the Taliban and Al Qaeda in the tribal areas with drone raids Islamabad denounces as lip service, as long as they do not kill many civilians.

Americans regularly accuse their ally Pakistan playing a double game and secretly supporting the Taliban to defend its strategic interests in Afghanistan, where NATO plans to withdraw all its combat troops by the end of 2014 . Already stormy relations between the two countries soured after the unilateral U.S. operation in which killed the head of al-Qaeda Osama bin Laden last May in Abbottabad, a garrison town in Northern Pakistan.

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Obama tells Asia U.S. "here to stay" as Pacific power

Barack Obama, U.S. President

(Reuters) - President Barack Obama announced on Thursday that the U.S. military would expand its role in the Asia-Pacific region, despite budget cuts, declaring America was "here to stay" as a Pacific power which would help shape the region's future.

China has voiced misgivings about Obama's announcement of fresh troop deployments to Australia and has longstanding fears that its growing power could be hobbled by U.S. influence. But Beijing has also stressed that conflict is in nobody's interest.

Obama addressed the Chinese unease, pledging to seek greater cooperation with Beijing.

The U.S. military, turning its focus away from Iraq and Afghanistan, would be more broadly distributed in Asia, particularly Southeast Asia, more flexible and help build regional capacity, Obama told the Australian parliament.

"As we end today's wars, I have directed my national security team to make our presence and missions in the Asia Pacific a top priority," Obama said in a major speech on Washington's vision for the Asia-Pacific region.

"As a result, reductions in U.S. defense spending will not -I repeat, will not - come at the expense of the Asia Pacific."

Obama was clear in acknowledging China's discomfort at what it sees as attempts by Washington to encircle it.

"We'll seek more opportunities for cooperation with Beijing, including greater communication between our militaries to promote understanding and avoid miscalculation," he said.

Nervous about China's growing clout, U.S. allies such as Japan and South Korea have sought assurances from the United States that it would be a strong counterweight in the region.

A first step in extending the U.S. military reach into Southeast Asia will see U.S. marines, naval ships and aircraft deployed to northern Australia from 2012.

China has questioned the new U.S. deployment, raising doubts whether strengthening such alliances helped the region pull together at a time of economic gloom.

Obama said the United States would seek to work with China to ensure economic prosperity and security in the region, but would speak candidly about issues such as human rights in China and raise security issue like the South China Sea.

China claims the South China Sea, a vital shipping route rich in oil, minerals and fishery resources. But Vietnam, the Philippines, Taiwan, Malaysia and Brunei hold rivals claims to at least parts of the sea, sparking maritime stand-offs.

U.S. Secretary of State Hillary Clinton pointedly visited the Philippines on Wednesday, saying that no claimant should resort to intimidation to push its cause.

Obama also referred in his address to reforms undertaken by Myanmar's new civilian leaders, including the release of political prisoners. But he said they had to do more on human rights in order to secure better relations with Washington.

Rory Medcalf, security analyst at the Lowy Institute for International Policy in Sydney, said Obama's speech marked a hardening of policy toward China, though he noted that the president was still reaching out to Beijing.

"I think we are seeing a firm stance from Obama. He spent the first year of his presidency trying very hard to engage with China, perhaps even to accommodate China," said Medcalf.

"I think he feels that he was rebuffed and that he was in effect taken advantage by China. So, there is a fundamental reorienting of American policy on display here."

U.S. SEEKS MORE FLEXIBLE FORCES IN ASIA

The winding down of wars in Afghanistan and Iraq has opened the door to greater U.S. attention to simmering tension over the South China Sea, a shipping lane for more than $5 trillion in annual trade that the United States wants to keep open.

Obama and Australian Prime Minister Julia Gillard on Wednesday agreed to have 2,500 U.S. Marines operate out of a de facto base in the northern port of Darwin by 2016.

The United States has military bases and large forces in Japan and South Korea, but its presence in Southeast Asia was dramatically reduced in the early 1990s with the closure of bases at Clark Field and Subic Bay in the Philippines.

Deploying U.S. Marines, ships and aircraft in Darwin, only 820 km (500 miles) from Indonesia, will allow the United States to quickly reach into Southeast Asia and the Indian Ocean to ensure secure major trade sea-lanes.

Obama cited increased U.S. naval ship visits and training in the Philippines and Singapore, working with Indonesia to fight piracy, partnering Thailand for disaster relief, and significantly, acknowledged India's role in region security.

Washington welcomed "India as it 'looks east' and plays a larger role as an Asian power.

"We'll have new opportunities to train with other allies and partners, from the Pacific to the Indian Ocean," he said.

Medcalf said: "It will be a landmark speech of Obama's presidency. It states unequivocally that the U.S. is squarely focusing its strategic attention on Asia. Its defining that Asia as including the Indian Ocean and India."

In a note to his domestic audience, Obama said the increased focus on Asia-Pacific was essential for America's economic future.

"As the world's fastest-growing region-and home to more than half the global economy-the Asia Pacific is critical to achieving my highest priority: creating jobs and opportunity for the American people," he said.

Obama will fly to Bali late on Thursday, where he will seek to underscore a focus on Asia by becoming the first U.S. president to participate in the security East Asia Summit.

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Romney leads in first four nominating states: poll

Romney

(Reuters) - Former Massachusetts Governor Mitt Romney leads his campaign rivals in the four states that kick off the 2012 Republican presidential race, according to CNN/Time/ORC polls released on Wednesday.

Barely more than two months before the first nominating contest, Romney has narrow leads in Iowa and South Carolina and double-digit advantages in New Hampshire and Florida.

Conservative businessman Herman Cain, who surged into the lead in some recent national polls but has faced heightened scrutiny in the past week, is in second place in each state.

A Romney sweep of the first four states to cast votes in the nominating race would put an early end to the battle to find a challenger to President Barack Obama in 2012.

But the polls also found there was plenty of room for more changes in the frequently shifting Republican race. Majorities in Iowa and South Carolina said they might change their minds about their votes, and about half in Florida and New Hampshire said the same.

The polls found Romney with a slight edge in Iowa of 3 percentage points, 24 percent to 21 percent, over Cain. His lead was even smaller, 25 percent to 23 percent, in South Carolina. Both leads were within the polls' margin of error of 5 percentage points.

Iowa and South Carolina have big blocs of conservative voters distrustful of Romney, who as governor of liberal Massachusetts supported abortion rights and a healthcare overhaul that was a precursor of Obama's federal law.

Romney has a big 27-point lead over Cain in New Hampshire, which borders Massachusetts and where Romney has a vacation home. He also has a comfortable 12-point lead, 30 percent to 18 percent, over Cain in Florida.

The polls were taken Thursday through Tuesday, following the most recent Republican debate last week.

Libertarian U.S. Representative Ron Paul was in third place in Iowa, South Carolina and New Hampshire. In Florida, former Speaker of the U.S. House of Representatives Newt Gingrich and Texas Governor Rick Perry were tied for third place.

Iowa kicks off the nominating race on January 3, followed by New Hampshire, which is expected to hold its primary on January 10, South Carolina on January 21 and Florida on January 31.

Romney's support was relatively broad across various political and demographic groups. He led easily among self-styled moderate or liberal Republicans, but also led among Tea Party fiscal conservatives in New Hampshire. He tied Cain among that group in Florida and was second behind Cain with Tea Party voters in Iowa and South Carolina.