- - Tuesday, February 15, 2011

WHITE HOUSE

Obama starts drive for malpractice reforms

Putting his own stamp on a long-standing Republican priority, President Obama is launching a drive to overhaul state medical malpractice laws and cut wasteful tests doctors perform because they fear lawsuits.

Mr. Obama’s budget calls for $250 million in Justice Department grants to help states rewrite their malpractice laws in line with recommendations that his bipartisan debt-reduction commission issued last year.

Specific reforms do not include caps on jury awards that the American Medical Association and GOP lawmakers have pursued for years without success. But they do include measures that have been unacceptable to trial lawyers, an interest group that contributes heavily to Democratic candidates.

HOUSE

Fannie Mae chief defends legal aid

The head of Fannie Mae and his firm’s government overseer Tuesday defended the use of millions in taxpayer dollars to pay legal bills for former executives accused of fraud.

Michael Williams, Fannie Mae’s chief executive, and Edward DeMarco, director of the Federal Housing Finance Agency, each told a House panel that not paying for the legal aid would be counterproductive and generate more lawsuits.

“If Fannie Mae were to refuse to honor this obligation, we would undoubtedly be sued and likely subject to additional costs,” Mr. Williams said in prepared testimony to the House Financial Services subcommittee on oversight and investigations.

Fannie Mae, along with sibling organization Freddie Mac, was seized by the Bush administration in 2008 amid mounting losses from mortgages gone bad and is now effectively under government control.

COURTS

Assange associates fight records request

Prosecutors Tuesday clashed in federal court in Alexandria, Va., with associates of WikiLeaks founder Julian Assange over a request for their Internet records in a probe into the leaking of secret U.S. diplomatic messages.

Prosecutors obtained a court order on Dec. 14 requiring the social media site Twitter to turn over records for Mr. Assange, U.S. Army intelligence analyst Bradley Manning who is suspected of the leak, and several others.

Birgitta Jonsdottir, a member of Iceland’s parliament, and two others who were among those targeted by the court’s order sought to quash it. They demanded the court unseal orders for their records from other service providers so they could seek to quash them, too.

U.S. Magistrate Judge Theresa Buchanan, who issued the Dec. 14 order, did not rule from the bench Tuesday after more than an hour of oral arguments by the two sides. She said she would issue a written opinion but gave no timetable.

Prosecutors, who in court described the investigation as in its “preliminary stages,” have been casting a wide net to determine whether Mr. Assange broke any laws related to his publication of thousands of leaked diplomatic cables on his WikiLeaks website.

ECONOMY

Retail sales slow, but growth detected

Growth in sales at U.S. retailers slowed in January, partly because of harsh weather across much of the country, but the trend remained supportive of an acceleration in economic growth.

Total retail sales rose 0.3 percent for a seventh straight month of advances, the Commerce Department said Tuesday, but this was below the 0.5 percent increase posted in December.

Economists who had expected a 0.6 percent gain said sales were likely to bounce back quickly.

Bad weather also affected January’s employment report and is making it hard to get a clear read of the economy. Still, economists say activity is transitioning from a recovery to a self-sustaining phase.

WHITE HOUSE

Obama to host small-business forum

President Obama will host a forum on small business in Cleveland next week as he looks to promote his plans to boost U.S. competitiveness.

The White House says Mr. Obama, along with several members of his Cabinet, will hear directly from small-business owners during the Feb. 22 event at Cleveland State University.

Mr. Obama has been traveling outside of Washington about once a week as he seeks to promote the competitiveness agenda he outlined in last month’s State of the Union address.

HOUSING

Homebuilders grim on housing market

Homebuilders have yet to see a turnaround in the housing market after the worst year for new-home sales in a half-century.

The National Association of Home Builders said Tuesday that its index of builder sentiment for February remained unchanged for the fourth straight month at 16. Any reading below 50 indicates negative sentiment about the market. The index hasn’t been above that level since April 2006.

Homebuilders are struggling to compete with millions of foreclosures that are forcing home prices down. Last year was also the worst in more than a decade for sales of existing homes.

Weak home sales mean fewer jobs. Each new home built creates, on average, the equivalent of three jobs for a year and generates about $90,000 in taxes, according to the trade group.

ILLINOIS

Emanuel praised for shoveling snow

CHICAGO | President Obama said he doesn’t have to make calls on behalf of Rahm Emanuel, his former chief of staff who is running for mayor of Chicago. The president said Mr. Emanuel seems to be “doing just fine” on his own.

Mr. Obama also jokingly praised Mr. Emanuel for his efforts shoveling snow in the wake of some massive recent snowfalls in Chicago. Mr. Emanuel has been seen around Chicago helping clear the snow, something Mr. Obama said he never saw his onetime aide do in Washington.

Chicagoans vote for mayor on Feb. 22. It’s Mr. Obama’s hometown, and the president and his wife still vote there by absentee ballot.

The president spoke at a White House news conference Tuesday.

HOMELAND SECURITY

Government, NBA team launch security campaign

The Homeland Security Department and the NBA said Tuesday they will launch a security campaign at this weekend’s All-Star game activities in Los Angeles, encouraging people to report suspicious activity.

“We hope that this partnership will emphasize basically that security is a shared responsibility,” said NBA Commissioner David Stern, appearing at a news conference with Department of Homeland Security Secretary Janet Napolitano at the Verizon Center.

TV monitors and print materials at the All-Star game will urge people, “If you see something, say something” — a core post-Sept. 11 message.

“We think that sports is a terrific way to send messages, and to get people who go to events to focus on this very important message,” Mr. Stern said.

DHS partnered with the NFL on the campaign at last week’s Super Bowl in Dallas. Ms. Napolitano also visited the host city to tour the Super Bowl stadium and review the NFL’s security plans.

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