Archive for February, 2009
Coming: Rs 6000 crore poll stimulus
NEW DELHI: Pranab Mukherjee’s interim budget may have disappointed as it failed to provide a third stimulus package for the economy, but the coming Lok Sabha election is expected to provide a stimulus of sorts. Around Rs 6,000 crore would be pumped into the system as political parties and candidates splurge on their campaign and the Election Commission pays a huge bill for conducting the election. And the main beneficiary would be the services sector that often spurs growth. Poll norms, of course, limit the amount of money that a party or candidate can spend during elections. But in reality, the actual expenses are almost always 4-5 times in excess of such restrictions. On top of this, there are surrogate expenses incurred by support groups that swell the amount of money that changes hands during campaigns. Political parties may deny this on record. But in private every politician admits the fact that a serious candidate spends on an average at least Rs 2 crore for fighting for a Lok Sabha seat, even though the official limit is just Rs 25 lakh. In some constituencies – especially in metros – candidates spend higher. For instance, a third candidate in a Mumbai constituency is learnt to be splurging. In this election, many contests are expected to be triangular. In other words, there will be at least three serious candidates in most contests. Besides, delimitation has changed the shape of every constituency, bringing in new voters. And candidates will have to spend more to reach out to these voters whom they have not cultivated in the past. So, assuming there will be on an average three serious contenders in each of the 543 Lok Sabha seats, these candidates alone would be spending at least Rs 3,258 crore. Given the fragmentation of the polity and the outbreak of aspirations, there are likely to be resourceful rebels and other candidates spending between Rs 20-50 lakh each – depending on their political and financial clout or affiliation to a strong local party. The combined spending by such candidates throughout the country can be conservatively put at Rs 250 crore. Then are the expenses borne by parties. Both Congress and BJP are expected to end up spending about Rs 200 crore each this time. These expenses will cover the cost of running the propaganda machine as well as lumpsum payments to the candidates. Strong regional parties such as the BSP, BJD, JDU, DMK and NCP that hold power in key states, as well as parties such as the SP and AIADMK and Shiv Sena which have held power earlier and are very much in the reckoning, will also not count their pennies. Put together, they could end up spending another Rs 250 crore, if not more. Beyond all this, the Election Commission’s cost of conducting the poll is likely to be well over Rs 1,300 crore, the cost incurred in the last Lok Sabha poll in 2004. The Interim Budget on Monday made a provision of only Rs 850 crore for this purpose, but considering that the expenditure rose from Rs 880 crore in 1999 to Rs 1,300 crore five years later, the amount this time is bound to be revised upwards. Admittedly, not all expenses – except those by the EC – will reflect on paper. In 2004 election, for example, the Congress declared an expense of Rs 125 crore and the BJP just Rs 42 crore. The difference was that the saffron party did not declare the lumpsum payments it made to candidates. But for the economy, it’s not what is on paper that matters but the reality on the ground. For providers of vehicles, shamianas, posters, sound systems, and sundry other services there’s big money coming their way.
Read Full Post | Make a Comment ( 1 so far )Obama set to sign stimulus plan
US President Barack Obama is due to sign his hard-fought economic stimulus plan in Denver, after Congress approved the $787bn (£548bn) package last week.
The unusual ceremony is being held at a Denver museum, away from the partisan tensions still gripping Washington.
The plan got no Republican support in the House of Representatives and just three Republican votes in the Senate.
Republicans say the tax cuts are insufficient, and that the economy will be saddled with debt for years to come.
The signing of the massive stimulus measure is designed to start the flow of federal money toward infrastructure projects, health care, renewable energy development and conservation programmes.
The approved version of the plan is split into 36% for tax cuts and 64% percent in spending and money for social programmes.
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STIMULUS PACKAGE
$240bn in tax breaks for individuals and businesses
$140bn for health care
$100bn for education
$48bn for transportation projects
Source: Associated Press
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Protectionism
The bill also includes a controversial “Buy American” provision that, despite being watered down, has angered US trading partners.
On Monday, Brazil’s Foreign Minister, Celso Amorim, threatened to challenge the legality of the clause at the World Trade Organization (WTO).
“It’s a complex legal analysis, but we’re doing it,” Mr Amorim told state television. “[Going to the WTO] is a real option,” he added.
The approved plan stipulates that public works and building projects funded by the stimulus use only US-made goods, including iron and steel.
The EU and Canada had earlier said that provisions favouring American-produced materials for government projects risked provoking retaliatory protectionist measures.
Earlier this month, Brazil’s President Luiz Inacio Lula da Silva told the BBC that in the good years, the rich countries had talked a lot about free trade and the market.
Now they had created a crisis they shouldn’t turn to the protectionism which had so often held the world back, President Lula said.
US tycoon charged over $8bn fraud
Texan billionaire and cricket promoter Sir Allen Stanford has been charged over a $8bn (£5.6bn) investment fraud, US financial regulators say. The Securities and Exchange Commission said the businessman had orchestrated “a fraudulent, multi-billion dollar investment scheme”. US investigators earlier entered the Stanford Financial Group Texas office. The SEC said the fraud was “based on false promises and fabricated historical return data”. Three of Sir Allen’s companies have been charged as well as several executives of the companies. We are alleging a fraud of shocking magnitude that has spread its tentacles throughout the world Rose Romero, SEC A US judge has also frozen the assets of Sir Allen and the other defendants as well as those of the Texas-based investment firm Stanford Group, its Antigua-based subsidiary Stanford International Bank (SIB) and another subsidiary, investment advisor Stanford Capital Management. A receiver has been appointed to “preserve assets for investors”, the SEC said. ‘Close circle’ Sir Allen last year promoted the Stanford cricket Series which saw a West Indian all-star team – the Stanford Superstars – beat an England team for a $20m prize. The England and Wales Cricket Board has suspended sponsorship negotiations with him following the fraud charges. The SEC said that SIB sold approximately $8bn worth of certificates of deposit to investors, promising “improbable and unsubstantiated high interest rates”. The bank was “operated by a close circle of Stanford’s family and friends”, the SEC said in a statement. “We are alleging a fraud of shocking magnitude that has spread its tentacles throughout the world,” said Rose Romero of the SEC. The charges follow follow the arrest of US financier Bernard Madoff, charged in December with a $50bn (£35bn) investment fraud.
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Read Full Post | Make a Comment ( 1 so far )Russian and US satellites collide
US and Russian communications satellites have collided in space in what is thought to be the biggest incident of its kind to date.
The US commercial Iridium spacecraft hit a defunct Russian satellite at an altitude of about 800km (500 miles) over Siberia on Tuesday, Nasa said.
The risk to the International Space Station and a shuttle launch planned for later this month is said to be low.
The impact produced a cloud of debris, which will be tracked into the future.
Since the Soviets launched Sputnik in 1957, it is estimated about 6,000 satellites have been put in orbit.
Satellite operators are all too aware that the chances of a collision are increasing.
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 The space station does have the capability of doing a debris-avoidance manoeuvre if necessary John Yembrick
Nasa spokesman |
The Americans are now following the debris path from the impact. It is hoped that most of it will fall to Earth and burn up in the atmosphere.
Shuttle launch
The concern is whether the debris will spread and pose any risk to the ISS, which is orbiting the Earth some 435km below the course of the collision.
According to the Washington Post, a Nasa memo said officials determined the risk to be “elevated” but have estimated it as “very small and within acceptable limits”.
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SPACE DEBRIS
Around 17,000 objects tracked in space
Monitored by the US Space Surveillance Network
Nasa says four other cases of minor collisions in orbit
ISS has had to manoeuvre away from debris eight times
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Nasa spokesman John Yembrick said the ISS had the “capability of doing a debris-avoidance manoeuvre if necessary”.
He said this had happened on just eight previous occasions during the course of its 60,000-plus orbits.
Officials said there were no plans to delay the launch of Nasa’s space shuttle Discovery later this month, although that would be re-evaluated in coming days.
Nicholas Johnson, an orbital debris expert at the Johnson Space Center in Houston, was quoted by the Associated Press as saying that the Hubble Space Telescope and Earth-observing satellites at higher orbits and closer to the collision site were at greater risk of damage.
‘Extremely unusual’
Communications firm Iridium, based in Bethesda, Maryland, said it “lost an operational satellite” after it was struck on Tuesday by the Russian satellite.
It said its clients may experience some brief outages until it had temporarily fixed the problem by Friday.
Iridium said it hoped to replace the 560kg satellite, launched in 1997, with one of its in-orbit spares within the next 30 days.
The firm described it as an “extremely unusual, very low-probability event”, stressing that it was not caused by any fault on its part.
Russia’s space forces confirmed the collision with the defunct 950kg (2,094lb) satellite.
“A collision occurred between an Iridium 33 satellite and a Russian Kosmos 2251 military satellite,” Major General Alexander Yakushin said.
The satellite was launched in 1993 and ceased to function two years later, he said according to the AFP news agency.
Russia has not commented on claims the satellite was out of control.
Littered orbit
Space debris experts say the chances of such collisions have been rising.
A Nasa reconstruction showing how the satellites may have collided
Litter in orbit – caused in part by the break-ups of old satellites – has increased to such an extent that it is now the biggest threat to a space shuttle in flight.
Mr Johnson said that at the beginning of this year about 17,000 manmade pieces of debris were orbiting Earth.
The items, some as small as 10cm (four inches), are tracked by the US Space Surveillance Network – sending information to help spacecraft operators avoid the debris.
Of the 6,000 satellites sent into orbit since 1957, about 3,000 remain in operation, according to Nasa.
Europe has just initiated its own space surveillance programme. One of its main weather satellites had a near miss in December with a Chinese object. The Europeans knew nothing about the threat until the Americans contacted the European Space Agency to inform it of the danger.
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Read Full Post | Make a Comment ( None so far )Big jump in spanish unemployment
The number of people out of work in Spain increased by 199,000, or 6%, in January from the previous month, official figures show.
The record monthly jump brought the total jobless number to 3.3 million, the highest since 1996, the Labour Ministry said.
The ranks of Spain’s unemployed have swelled by more than one million in the past year.
At 14.4%, the Spanish unemployment rate is by far the highest in the EU.
“We continue to be affected by the serious international financial crisis, the lack of of liquidity and the fall in consumer spending,” said Maravillas Rojo, Spain’s employment secretary.
Spain was until recently one of Europe’s fastest growing economies, but the global financial crisis has hit the country hard, particularly affecting the property and construction sectors.
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EUROPE UNEMPLOYMENT
Netherlands 2.7%
UK 6.1%
Germany 7.2%
France 7.9%
Spain 14.4%
Source: Eurostat
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The European Commission has forecast that the unemployment rate will continue to increase in Spain to 16.1% in 2010 and 18.7% the following year.
In another sign of the weakening economy, Spanish car sales fell by 41.6% in January from a year earlier.
Prime Minister Jose Luis Rodriguez Zapatero met financial leaders on Monday to urge them to boost lending.
He also told those out of work that the country’s economic stimulus plan would begin taking effect soon, creating new jobs.
“We are going to overcome the economic crisis,” Mr Zapatero said earlier.
Read Full Post | Make a Comment ( 3 so far )Italy woman sent to clinic to die,save Eluana Englaro
A woman at the centre of the right-to-die debate in Italy has been moved to a clinic where she will be allowed to die after 17 years in a vegetative state.
Eluana Englaro was transferred by ambulance overnight to the private facility in the northern city of Udine.
The Vatican and anti-euthanasia groups have strongly opposed the move.
In November, Italy’s highest court ruled Ms Englaro’s feeding tubes could be withdrawn, but the health ministry then warned state clinics not to do it. 
On Sunday, Pope Benedict XVI added his voice to the debate about euthanasia, calling it a “false solution” to the tragedy of suffering.
“The true response cannot be to give death, even if it is seemingly more soothing, but to show the love that can help people face pain and agony in a human way,” he said in his weekly address.
But the pope did not mention Ms Englaro, 37, who has been in a permanent vegetative state since a car crash in 1992.
Her father, Beppino, has been battling with the courts in Italy to let her die since 1999, insisting it was her wish.
Court battle
The ambulance carrying Ms Englaro left the Catholic clinic in the northern town of Lecco, near Milan, at around 0130 (0030 GMT).
A small crowd of anti-euthanasia activists gathered outside the building and tried to prevent the vehicle from leaving. Some of the protesters shouted “Eluana, wake up”, and “Don’t kill her”.
Italy does not allow euthanasia although patients can refuse treatment
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In July, a court in Milan ruled that doctors had proved Ms Englaro’s coma was irreversible. It also accepted that, before the accident, she had expressed a preference for dying over being kept alive artificially.
State prosecutors appealed against the ruling, but the Court of Cassation in Rome ruled the challenge inadmissible in November.
The Italian health ministry subsequently issued an order barring all hospitals in the region from withdrawing Ms Englaro’s life support, but this was overruled by a court in Milan on 21 January.
A private geriatric clinic in Udine then said it would receive her and allow her to die.
Italian Welfare Minister Maurizio Sacconi said the government was investigating her transfer.
The Vatican’s Health Minister, Cardinal Javier Lozano Barragan, described the decision to move her as “abominable”.
“Stop this murder!” he told the newspaper, La Repubblica.
Italy does not allow euthanasia. Patients have a right to refuse treatment, but they are not allowed to give advance directions on what treatment they wish to receive if they become unconscious.
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