National News

Panama Asks Spain To Help Resolve Canal Expansion Dispute

NPR News - Mon, 2014-01-06 15:54

A European-led consortium has issued an ultimatum to the Panama Canal Authority, saying it will stop work unless it gets paid for $1.6 billion in cost overruns.

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CES 2014: Toothbrush? Bed? Car? Put Some Internet On It

NPR News - Mon, 2014-01-06 15:21

The Consumer Electronics Show is the tech industry's annual electronics showcase in Las Vegas, where companies are showing off their latest-and-greatest gadgets like Internet-connected toothbrushes (ideal for hygiene-concerned helicopter parents) and cars that come equipped with a 4G cell connection.

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Senate Confirms Janet Yellen As Federal Reserve Chair

NPR News - Mon, 2014-01-06 15:01

Janet Yellen, 67, will become the first woman to serve as America's banking chief, heading an institution that was established in 1913.

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Tighter Access To 'Death Master File' Has Researchers Worried

NPR News - Mon, 2014-01-06 14:37

The Social Security Administration has long kept track of deaths so it can stop checks when recipients die. And while researchers have used the file for years, fraudsters have, too. So Congress is limiting access to the data — and that has everyone from bankers to genealogists concerned.

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Health Care Costs Grew More Slowly Than The Economy In 2012

NPR News - Mon, 2014-01-06 14:30

Health care costs grew at 3.7 percent in 2012, the fourth year of a trend of smaller annual increases. The Obama administration says that the Affordable Care Act is a factor. But the actuaries who wrote the report beg to differ, saying the recession is a more likely cause.

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Democrats Tackle Politics Of Income Inequality

NPR News - Mon, 2014-01-06 14:24

Their embrace of the issue, which includes minimum wage and unemployment insurance legislation, has drawn push back from the GOP. Republicans say the efforts are politically motivated and designed to distract from problems with the health care law.

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4 Lessons From Liz Cheney's Ill-Fated Senate Run

NPR News - Mon, 2014-01-06 14:02

Even before family health issues arose, Cheney's campaign appeared to face dim prospects in the Wyoming GOP primary against Sen. Mike Enzi. One lesson from her now-ended bid: A famous political name only gets you so far.

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Could polar vortex dampen January's gym business?

Marketplace - American Public Media - Mon, 2014-01-06 13:55

“January is always the busiest month for us,” says Robby Huang, co-owner of Revel Fitness, a Zumba studio in Carmel, Ind. “We find a lot of people make New Year’s resolutions and they really stick to them really well.”

The influx in customers doesn’t make it harder to fit clients in at Revel Fitness because they don’t use equipment.  Huang says the classes just get bigger. Their busy season tends to last through March and April.

One damper on this year’s January boom for Huang? The snow storm that’s shut down much of the Midwest. Revel studio is closed today but Huang hopes to be open again soon.

How Much Does A New Hip Cost? Even The Surgeon Doesn't Know

NPR News - Mon, 2014-01-06 13:46

Medicare spends about $20 billion each year on implanted medical devices. Nearly half of the total goes for orthopedic surgery. Yet doctors who were surveyed about implant prices could only accurately estimate the prices about one-fifth of the time.

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Why non-bankers love Wall Street bonuses

Marketplace - American Public Media - Mon, 2014-01-06 13:40

This is the time of year when Wall Street bankers get their bonuses. The numbers can be staggering to those outside finance, with six-figure average payouts and high-level bonuses spiraling into the millions. This year looks to be uneven, with some bankers doing well and others, especially bond traders, getting less.

That money eventually flows through New York’s economy to a lot more people than one might expect, including armies of middle class workers and small business owners.

There may be national distaste for Wall Street, but there are many who don’t work there who nonetheless hope the big banks do well.

The New York catering company Sonnier & Castle produces elaborate dinners that cost hundreds of dollars per person. Recently, it catered the movie premiere of "The Wolf of Wall Street."

“A third of our business comes from the financial industry,” estimates co-founder David Castle. “Bonuses would be great for us. It would definitely translate into bigger spending and to more hiring, more jobs.”

Castle says corporate entertaining hasn’t fully recovered from the crash, but bank employees are spending again on personal events. That means their bonuses are more important than ever.

The catering company laid off workers in the financial crisis. But with sales up 20 percent last year amid a recovering economy, Castle is hiring again, adding staff positions as well as part-time servers and cooks, who rely on the extra income or use the jobs as stepping stones to full-time work.

"They're receiving income and in turn, they turn around, they spend it," says New York University economics professor Lawrence J. White. "The initial beneficiaries are the people who receive the bonus, but it doesn't stop there."

It's what economists call a multiplier effect, the rippling economic impact of all that bonus money as it passes through various hands.

Speaking of candlesticks, there are some rather nice ones in homes where Darren Henault designs the interiors.

Photos on the walls of his studio show the many rooms he created. They include the homes of some of the top people in finance.

The rooms look stunning, like lush film sets. Clients pay him hundreds of thousands of dollars to perfect the insides of their multi-million dollar properties. When a banker’s bonus comes up short, he knows.

"I have definitely had people say to me, 'I did not have a great year. Let's dial back,'" Henault says.

Many people reading this won’t care if a rich banker is less rich. It might even make them smile.

But before anyone gets too drunk on schadenfreude, it’s worth remembering that the fate of big banks can directly affect small business. If a banker scores a sweet bonus, he can give Henault a bigger budget. That means more pricey custom elements, and thus a lot more people going to work.

"More people are involved in the making of the higher-end things than the lower-end things," Henault explains, listing the types of people a big project will employ. "A custom painter, a faux finisher, out in Queens, there’s a company that does hand embroidery, all these different sort of artisans are people that we would bring in, as opposed to stock items which are being formed and spit out by machine."

And those giant bonuses are taxable, which means revenue from them helps fix streets, pay cops and fund programs low income residents depend on. That’s why New York politicians, even those on the left, rarely attack Wall Street pay.

Attacking bank bonuses is ever fashionable, providing meaty, easy targets for everyone from newspaper editorial writers to Washington politicians. But for regular people whose jobs depend on them, big Wall Street bonuses aren’t excessive. They’re vital.

Mark Garrison: We are miles from the financial district, inside the busy kitchen of New York catering company Sonnier & Castle. That sizzle is the sound of swine near the end of the line.

Later, the glistening cube will be skewered, then passed around by an impeccably dressed young server at a very fancy party.

The company’s most elaborate dinners cost hundreds of dollars per person. Today, the team’s prepping for an event for a famous fashion designer. Recently, it catered the movie premiere of “The Wolf of Wall Street.” Co-founder David Castle says the real Wall Street is critical to the company’s bottom line.

David Castle: A third of our business comes from the financial industry.

Castle says corporate entertaining hasn’t fully recovered from the crash, but bank employees are spending again. That means their bonuses are more important than ever.

Castle: Bonuses would be great for us. It would definitely translate into bigger spending and to more hiring, more jobs.

His catering company laid off workers in the financial crisis. But with sales up 20% last year, Castle is hiring again, full-time staff as well as part-time servers and cooks who rely on the extra income. From the owners to the dishwashers, the whole company reaps the benefits of Wall Street bonuses.

Lawrence J. White: They’re receiving income and in turn, they turn around, they spend it.

That’s what economists like NYU’s Lawrence J. White call a multiplier effect. All that bonus money ripples across the entire economy.

White: The initial beneficiaries are the people who receive the bonus, but it doesn’t stop there.

A big bonus banker orders a fancy steak dinner from a server, who uses the big tip to splurge on new home furnishings. Everybody wins. As the old rhyme goes: the butcher, the banker, the candlestick maker. Ok, I did tweak it a bit. Speaking of candlesticks, there are rather nice ones in homes where Darren Henault designs the interiors.

In his studio, he shows photos of rooms he created. They include the homes of some of the top people in finance. The rooms look stunning, like lush film sets. Clients pay him hundreds of thousands of dollars to perfect the insides of their multi-million dollar properties. When a banker’s bonus comes up short, he knows.

Darren Henault: I have definitely had people say to me, ‘I did not have a great year. Let’s dial back again.’

Chances are, you don’t care if a rich banker is less rich. But think about it this way. If a banker gets a larger bonus, he can give Henault a bigger budget, which helps small businesses.

Henault: More people are involved in the making of the higher-end things than the lower-end things.

If that banker goes for pricey custom elements, a lot more locals are going to work.

Henault: A custom painter, a faux finisher, out in Queens, there’s a company that does hand embroidery, all these different sort of artisans are people that we would bring in, as opposed to stock items which are being formed and spit out by machine.

And those giant bonuses are taxable, which means they help fix streets, pay cops and fund programs low income residents depend on. That’s why New York politicians, even those on the left, rarely attack Wall Street pay. For regular people whose jobs depend on them, big Wall Street bonuses aren’t excessive. They are absolutely vital. In New York, I'm Mark Garrison, for Marketplace.

Foul Weather In Britain Linked To U.S. 'Polar Vortex'

NPR News - Mon, 2014-01-06 13:36

The southwestern U.K. is getting slammed by huge waves whipped up by 70 mph winds accompanying a low-pressure system sweeping in from the Atlantic.

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Don't Just Shiver, Here Are 3 Cold-Weather Experiments To Try

NPR News - Mon, 2014-01-06 13:29

With weather this cold, you could make an instant Slurpee and "snow" from boiling water.

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How I Almost Got Arrested With A South Sudanese Ex-Minister

NPR News - Mon, 2014-01-06 13:22

A dozen war heroes from South Sudan's long struggle for independence are now accused of launching a coup to overthrow the democracy they helped create. One of them, Peter Adwok Nyaba, was telling NPR's Gregory Warner about the political roots of the conflict when police came for him.

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Do big fines even matter for JP Morgan Chase?

Marketplace - American Public Media - Mon, 2014-01-06 12:58

Another year, another big fine for JP Morgan Chase. The bank's expected to soon be paying out another $2 billion in criminal and civil settlements to the federal government. This time for ignoring signs of Bernie Madoff's Ponzi scheme. That brings the grand total of fines JPM has paid in just the past year to just about $20 billion.

But the markets aren't paying any heed: Shares are up almost a percent today and CEO Jamie Dimon is still there. The company's doing just fine, it seems. But is there a limit?

Tim Fernholz from Qz.com thinks JPM's seeming invulnerability may be due to Wall Street's indifference to anything but the bank's financial performance: 

"What I think to look for with Jamie Dimon is going to be, the company's latest earnings report. Ultimately on Wall Street and I think among the investors and these banks, they're an amoral bunch in the strictest sense of that term in that they do not care about the crime, they care about the stock price and the earnings."

Fernholz also says that it's important to remember that the fines and penalties we see today are punishing crimes and practices that aren't necessarily still happening.

"So it's hard to say...if they've cleaned up their act, and I think that's one of the reasons that prosecutors have reportedly opted for this deferred prosecution agreement," Fernholz says, "They're going to ask JP Morgan to really strengthen the controls that they supposedly put to watch out for things like Ponzi schemes or drug runners or any other kind of money laundering."

Sandwich Monday: The Ignatius R

NPR News - Mon, 2014-01-06 12:54

For this week's Sandwich Monday, we brave the record-breakingly cold streets of Chicago to try the Ignatius R, a record-breakingly enormous sandwich from Jerry's Sandwiches. It's a potato bun wrapped around pretty much everything you can imagine.

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Is Congress playing a shell game?

Marketplace - American Public Media - Mon, 2014-01-06 12:45

One of the first items on Congress's agenda in the new year is whether to reinstate emergency unemployment benefits that expired in late December.

There is a key vote in the Senate Monday afternoon. House Republicans have said they'd consider the idea, but only if the cost of the extended benefits is offset.

Deals like that are common in Washington, but that doesn't mean the savings always materialize as promised. 

“There’s a con going on,” says economist Donald Marron. 

Marron is a former economic adviser for George W. Bush, now at the Urban Institute.  He says Congress isn’t a bunch of cons, but he says its budget deals are pretty gimmicky, like when Congress ignores a program’s long-term costs, focusing instead only on short-term revenues.

“So they’ll show up and they’ll appear to be helping to pay for whatever the program is you want to pursue, but it still means in the long run that we’re going to lose money," Marron explains.

Now you see it.  Now you don’t.   That short-term thinking leads leads to itty-bitty deals, like the Senate’s proposed emergency unemployment extension, which would only last three months. 

“If it’s only for three months you can sort of slide it under the rug and you don’t have to pay for it," says Henrietta Treyz, a budget expert at Height Analytics.

Just don’t look under the rug.  Some Washington wonks say these kinds of games are inevitable right now.  Harry Holzer, who teaches public policy at Georgetown, says with some in Congress vowing to take huge bites out of the deficit, normal budget negotiations just aren’t possible.    

"It often has to be a bit of a shell game to square with their very severe rhetoric on fiscal austerity right now,” he says.

How cold is it when the economy breaks?

Marketplace - American Public Media - Mon, 2014-01-06 12:45

Schoolchildren are home by the millions. Flights are grounded by the thousands. Wind chills are being measured in the negative double digits. The great Polar Vortex of '14 is making its mark on much of the country, and the economy. Because a lot of things we take for granted day in and day out -- from starting the car to turning on the faucet -- were a little harder today.

“Plumbers get really busy,” says Nolan Doesken, state climatologist in Colorado. “This is the ideal situation for frozen pipes, when it’s not only really cold, but really windy to go with that cold.”

Jeff Cherwenka is used to working in extreme cold. He spent six seasons doing research at the South Pole. Now he’s back at the University of Wisconsin-Madison, where it was minus 17 degrees this morning.

“It looks like it’s minus 9 Fahrenheit at the South Pole today, so it’s actually colder here than at the South Pole,” he says.

At these temperatures, Cherwenka says, plastic and steel become so brittle they can break. Car batteries stop working.

“There’s a lot of little inconveniences,” he says, “but if it’s your car and it’s not starting then it’s a big inconvenience, right?”

At the high-tech end, electronics can fail. Kevin Gutknecht with the Minnesota Department of Transportation says things got dicey today on a reversible toll road on the west side of Minneapolis.

“We call it reversible because it goes in one direction in the morning, and another direction in the afternoon,” he says. “One of the gates on that quit working because of the cold.”

Below ground, water mains break. Even sewers can freeze. Shipping slows down in the Great Lakes. Diesel fuel can congeal.

“Things just break when it’s cold,” says Wilf Nixon, professor of civil and environmental engineering at the University of Iowa. “Unfortunately, they’re under more stress and it’s when you need them most…when they’re most likely to fail on you.”

That includes humans, too. We don’t work so well when it only takes a few minutes in the cold to end up with frostbite.

Fatigue doesn’t help. In Elgin, Il., public works superintendent Daniel Rich says his workers have been doing 12-hour shifts since before Christmas, removing snow, de-icing streets and fixing water main breaks.

“You can tell the guys are getting a little tired, and as a result of that they slow down a quarter step,” he says.

Where are our jetpacks and flying cars?

Marketplace - American Public Media - Mon, 2014-01-06 12:45

Tomorrow is the start of the Consumer Electronics Show in Las Vegas, the annual bacchanal of all things technological. The tech industry is known for promising us the future, but how often does technology deliver on that promise. We are after all, still waiting on the JetPack.

Benjamin R Harrison was working at CES last year as videographer for the website Engadget when he was ushered into a hotel room, to see the unveiling of a prototype for a virtual reality headset that allows users to become the character in a game. "At that point it was literally ski goggles that had components duct-taped into it," remembers Harrison. Virtual Reality, like JetPacks, was promised to us long ago. In this case, the duct tape ski goggle contraption became Oculus Rift, a virtual reality headset expected to deliver on the promise of virtual reality gaming.

Roughly 20,000 new products will launch at this year's CES. But very few will be big commercial successes. "I think the way to think about this is as more of a case of evolution then things succeeding or failing," says Shawn Dubravac, chief economist and head of research at The Consumer Electronics Association, which produces CES.

Many of the products unveiled this week will flop commercially. Often the first generation of a product is the crummiest. It can take time for bugs to be worked out or for people to understand why something would be useful to them. Many of this year's new products are part of a larger technological trend, the digitization of everyday things.

Dubravac says the future is one of sensorization, where everyday objects, from toothbrushes to tennis rackets, will have sensors that generate streams of data, like the speed of your backhand. The age of autonomy, as Dubravac calls it, where cars drive themselves, and all of our things talk to our computer so it can manage all the data generated by our new gadgets, freeing us to enjoy them.

A planemaker by any other name ...

Marketplace - American Public Media - Mon, 2014-01-06 12:38

This final note to observe a long-overdue bit of corporate rebranding.

First, do you know what EADS stands for?

No? Even though you've probably flown on their planes.

The European Aeronautic Defense and Space Company makes Airbuses.

Executives have now apparently recognized the ungainlyness of that name and have renamed themselves simply: Airbus.

Looks Like The Paleo Diet Wasn't Always So Hot For Ancient Teeth

NPR News - Mon, 2014-01-06 12:22

When hunter-gatherers started adding grains and starches to their diet, it brought about the "age of cavities." At least, that's what a lot of people thought. But it turns out that even before agriculture, what hunter-gatherers ate could rot their teeth. The problem: At least some of these ancients had a thing for acorns.

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