Clem’s Chronicles: Santa Barbara Fires/Afghanistan-Pakistan/Bank Stress Tests

By Clem Lane

May 6, 2009 9:57pm

Howdy-Clem Lane here. We’ve updated our West Coast version of WORLD NEWS with the latest from the Santa Barbara wildfires. Unfortunately, houses are burning. Here’s the note:

SANTA BARBARA WILDFIRE-After lying down all day, the fire above Santa Barbara has reinvigorated itself thanks to winds up to 60 mph, 100 degree temperatures and plummeting humidity levels. At a briefing that concluded a short time ago, fire officials said the fire is moving rapidly. Sheriff’s Department officials say that the evacuation area has been expanded. An untold number of homes have burned and one firefighter has been injured. More than 400 firefighters are on the lines. 

US/PAKISTAN-AFGHANISTAN-President Obama welcomed his counterparts from Afghanistan and Pakistan to the White House today. What Obama wants from Afghan President Hamid Karzai and Pakistan President Asif Ali Zardari is a little help in the terrorist-fighting area. This is no small task. Jake Tapper noted on WORLD NEWS that the security of the Afghanistan-Pakistan region “is emerging as his biggest international challenge, if not crisis.” Obama wants his colleagues ”to get serious about defeating the extremists in their countries.” President Obama reminded everyone why we should care-“Our strategy reflects a fundamental truth: the security of Pakistan, Afghanistan and the United States are linked.” Pakistan is a particularly tough nut to crack-Tapper notes that “last month Pakistan, a country with nuclear weapons, entered into an agreement with the Taliban to allow them control of the Swat valley.” While that deal fell through, it did reinforce the belief that more $$$$ was needed for the Pakistani government to fight a resurgent Taliban. Not that the track record is very good on the money front-Tapper notes that “the US has already spent $10 billion in Pakistan, with much of it unaccounted for.” Still with the Taliban fighting Pakistani forces close to the capital(Charles Gibson noted the fighting was within “60 miles of Islamabad”), Martha Raddatz says the US sees the situation as “urgent. And they are really going to be watching the area for the next two weeks.” Money hasn’t solved problems in Afghanistan yet either. Nick Schifrin, reporting from Afghanistan for WORLD NEWS, says that “billions of dollars in international aid…much of it American have improved agriculture, infrastructure and schools. But that aid hasn’t reached everyone.” Those who still have nothing-what to do? Schifrin says that “poverty and desperation are fueling the Taliban’s fighting force”.  So it is on both sides of the Afghan-Pakistan border. “Without more opportunities” Schifrin noted, “the U.S. won’t defeat a Taliban that is preying on poverty.”

BANKS/STRESS TEST RESULTS-Well official results aren’t released until tomorrow afternoon at 5pm ET, but there have been enough leaks today (if the information turns out be accurate) to get a sense of things. Betsy Stark on WORLD NEWS reports that “some of the big banks that reportedly have enough cash to ride out (a downturn in the economy include) Bank of NY, Mellon, American Express, MetLife, Goldman Sachs and JP Morgan Chase. Bank of America, Citigroup, Wells Fargo and GMAC need more money.” The figure bandied about for Bank of America is that they need another $34 billion in case the economy goes further south. Charles Gibson noted that “the stock is up tonight”. Betsy Stark please explain: “It is hard to fathom. Some say it wasn’t really a surprise that Bank of America needs to raise more case. Some say between the assets it can sell and the money it has already gotten from taxpayers, its shortfall is manageable. Some are saying that Wall Street investors are signaling that they are relieved that the uncertainty surrounding the stress tests are going to be over.”

RETOOLING IN MICHIGAN: If Ford has its way, there could be a Focus in your future.  And if that Focus turns out to be the battery-electric version, it could run up to 100 miles without using gas or emitting greenhouse gas.  So today, at a plant that once built gas guzzlers like the Lincoln Navigator, the automaker changed its focus (so to speak) – as Chris Bury explained on World News:  “Ford made a big show of its plans for retooling this former S-U-V plant – at a cost of half a billion dollars – to build the new Focus compact, creating more than 3,000 jobs in Michigan alone.”   A Ford statement explained the company’s new approach this way: "We’re changing from a company focused mainly on trucks and SUVs to a company with a balanced product lineup that includes even more high-quality, fuel-efficient small cars, hybrids and all-electric vehicles." Ford is the only U.S. automaker not taking any government aid but as Chris Bury points out: “It’s not that Ford is doing that well.  Sales are down 43 per cent this year.  It’s burning through more than a billion dollars a month.  Still, that’s half of what it spent last year. And the stock price has tripled since February.”  And planning ahead appears to have been the key, says Chris: “Two years ago, Ford mortgaged everything it owns, from all its factories…to its blue logo…to raise cash.  Nearly $24-billion.”   The new battery-electric Focus is expected to debut in 2011. (thanks to Ed Bailey for this entry)

FBI TRIES TO CRACK DOWN ON MEDICARE FRAUD:  Pierre Thomas recently traveled to Florida took a look inside the widespread – and highly profitable – problem of Medicare fraud for WORLD NEWS.  Medicare fraud amounts to $60 billion in losses annually and, as a former convict in Miami told Thomas, it’s easy money:  "It’s faster and easier than selling drugs," he said.  “The scam was simple,” Thomas explains, “he set up phony businesses billing Medicare more than $8 million over 7 years for medical equipment he never sold…A recent survey of 1,500 Miami area medical equipment companies discovered 31 percent were phony – even though they were billing the government.”  In Florida three counties alone racked in $1.5 billion in Medicare fraud – and those are just the ones the FBI has caught.  In addition to it being a remarkably easy scam to set-up and run, prosecution against the white collar schemes is not as harsh as say, drug convictions. “The risk might be worth the reward" for some criminals who choose to run Medicare scams Timothy Donovan, the assistant special agent in charge of the FBI’s Miami field office, told ABC News.  For more on this please visit Thomas’s article on (thanks to Marisa Bramwell for this entry)

GM SHUTTERING MORE PLANTS-Charlie Herman reports “GM previously announced 13 assembly plants will close for up to 11 weeks during the summer to cut inventory. Today, wires reporting GM will also shut down 23 plants that provide the parts to those assembly plants for varying lengths of time.” The additional closures affect more than 18,000 hourly and salaried workers.
DUDE, WHERE’S YOUR LANDLINE?- Have you still got a home phone? Me neither. We’re not alone-20% of households had only cells during the last half of 2008, according to a Centers for Disease Control and Prevention survey released today. That was an increase of nearly 3 percentage points over the first half of the year, the largest six-month increase since the government started gathering such data in 2003.
NEW ENGLAND GAY MARRIAGE- Maine’s governor John Baldacci has signed a bill making the state the fifth to allow gay marriage. New Hampshire legislators also passed a gay marriage bill today. New Hampshire Governor John Lynch has not indicated whether he’ll sign it. If gay marriage becomes law in New Hampshire, Rhode Island would be the sole holdout in New England. Iowa is the only state outside the region to allow the practice.
MISSING MISSOURI BOY FOUND-A 3-year old Madison County, Missouri boy missing since Monday has been found according to authorities. He’s said to be in good condition. NNS material has been put into Pathfire.

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