Tuesday, January 18, 2005
Rice Defends Bush Plan for Iraq Against Senate Democrat Critics
Jan. 18 (Bloomberg) -- Condoleezza Rice defended the Bush administration against U.S. Senate Democrats' complaints that it misled Americans about the risks of war in Iraq and planned poorly for the postwar occupation.
Rice, who's seeking Senate confirmation as secretary of State, conceded few errors.
``I'm sure that we have made many decisions, some of which were good, some of which might not have been good, but the strategic decision to overthrow Saddam Hussein was the right one,'' she told the Senate Foreign Relations Committee, which is weighing her nomination.
Republicans control the Senate, and lawmakers from both parties say Rice, 50, will be confirmed, possibly as early as Thursday after Bush takes his oath of office for a second term. Democrats used today's hearing to highlight unease with the violence plaguing postwar Iraq, press Rice on U.S. policies toward Iran, North Korea, the Middle East, global warming, the trade deficit and other issues, and urge a more conciliatory approach toward allies.
U.S. relations with many of its oldest allies ``are frankly scraping bottom,'' Joseph Biden of Delaware, the committee's ranking Democrat, said.
``We pay a price for being the world's sole superpower,'' Biden said. ``Today, after a necessary war in Afghanistan and an optional war in Iraq, we are rightly confident in the example of our power. But we have forgotten the power of our example.''
``The time for diplomacy is long overdue,'' he said, even as he pledged to vote for Rice and said he's ``confident'' she'll be confirmed.
`Generational Struggle'
Rice, in her opening statement, pledged to work with other nations in the ``generational struggle'' against terrorism. ``The time for diplomacy is now,'' she said. ``Our interaction with the rest of the world must be a conversation, not a monologue.''
She made no apologies for the war to oust Saddam Hussein, saying U.S. policy since the Sept. 11 attacks has been ``difficult and necessary and right.'' She also said she still doesn't believe the Bush administration used too small a military force for the war and its aftermath.
The U.S. faced ``unforeseen circumstances'' when Iraqi soldiers, rather than stand and fight a superior U.S. army, ``melted into the countryside'' and returned later in the form of a guerrilla insurgency that has cost more than 1,000 U.S. lives.
Kerry's Critique
Democrat John Kerry of Massachusetts, returning to the panel for the first time since his failed bid to unseat Bush as president, said he's ``disturbed'' that Rice still can't concede an error in the size of the military force needed to control Iraq.
Asked by Chuck Hagel, a Republican of Nebraska, to define the U.S. ``exit strategy'' from Iraq, Rice said much depended upon Iraqis achieving political reconciliation following elections set for Jan. 30. ``But that's largely an Iraqi task,'' she said.
Democrat Barbara Boxer of California, challenged Rice's credibility, citing some past statements on Iraq that appeared to contradict subsequent findings, including her prewar warnings that Iraq was stockpiling banned weapons, assisted the al-Qaeda terrorist network, and tried to buy thousands of high-strength aluminum tubes only suitable for nuclear weapons programs.
``This is a pattern of what I see from you,'' Boxer said.
Rice said she ``never ever lost respect for the truth in the service of anything.'' She then told Boxer: `` I really hope that you will refrain from impugning my integrity.''
`Has President's Ear'
Bush recommended Rice, a close personal friend and adviser, to replace Secretary of State Colin Powell, who differed with the president on elements of his Iraq strategy. Bush didn't even consult Powell before deciding to invade Iraq, realizing his opposition, author Bob Woodward wrote in ``Plan of Attack,'' a book based on interviews with top administration officials.
The State Department under Rice ``will have a spokesperson who has president's ear and the president's confidence,'' said James Steinberg, a deputy national security adviser in the Clinton administration who's now director of foreign policy studies at the Brookings Institution, a Washington policy study group.
Democrats said that might not be enough, given the depth of opposition among key U.S. allies to several chief Bush foreign policy positions, starting with the war in Iraq but also including such matters as global warming and economic sanctions.
``The secretary who adopts a unilateralist approach in the international environment may miss important opportunities to prevent conflicts and to build alliances,'' Senator Paul Sarbanes, a Democrat of Maryland, told Rice. ``And in that regard I just note that it's not enough to have the ear of the president. I think the secretary of state must also win the ear of the world.''
Trade Deficit
Sarbanes repeatedly pressed Rice to explain how significant to her job she considered such facts as the increasing U.S. trade deficit and the decreasing rate of net investment in the U.S.
Rice told him such matters were primarily the concern of Bush's economic advisers, though she said the State Department could help by promoting free trade around the world.
``Of course, the strength of the American economy is an important issue for American power, and therefore an important issue for the secretary of State,'' Rice said.
Rice deferred the question of whether Bush should appoint a special envoy to encourage peace between the Israelis and Palestinians. She suggested, however, that the U.S. take a more active rule in helping Palestinian leaders ensure an end to attacks against Israel.
``The restructuring of the Palestinian security forces is something that we have helped with in the past and should now with other neighbors, like Egypt or Jordan, be helping with in the future,'' Rice said.
Courting Venezuela
Rice also criticized Venezuelan President Hugo Chavez, whose country supplies about 15 percent of U.S. oil consumption, for failing to meet U.S. demands on democratic standards. Chavez, Rice said, is ``a democratically elected leader who governs in an illiberal way,'' whose ``government has not been constructive.''
Senator Christopher Dodd, a Democrat of Connecticut, said Rice should try harder with Chavez, noting Brazilian President Luiz Inacio Lula da Silva expressed anti-U.S. sentiments similar to those heard from Chavez before being persuaded to be more cooperative.
``It's a two-way street, Dr. Rice,'' Dodd said. ``It requires we work on it as well.''
Dodd also warned that the stability of some U.S. allies in Latin America is hurt by a Bush administration policy of cutting off military training funds to countries that don't grant the U.S. a waiver from a new international criminal tribunal.
Reshaping Leadership
Rice already has started to reshape the department's leadership, naming U.S. Trade Representative Robert Zoellick as her deputy. They worked together on the National Security Council under former President George H.W. Bush.
There probably will be a renewed dependence upon the State Department to help negotiate U.S. positions abroad, rather than impose them, said Kurt Campbell, a Pentagon and White House official in the Clinton administration.
``Because we are tied down militarily, and that tool is basically exhausted, it's going to mean diplomacy has much more sway,'' said Campbell, director of the international security program at the Center for Strategic and International Studies, a Washington policy study group.
The choice of Zoellick and the likely addition of Philip Zelikow, executive director of Sept. 11 Commission and another colleague of Rice from the previous Bush presidency, suggests she is forming an ``extraordinarily strategic and capable'' team, Campbell said.
Many senators on the committee praised Powell, who was secretary for four years after a 35-year career in the U.S. Army culminating in a term as Chairman of the Joint Chiefs of Staff. Rice called Powell ``my friend and my mentor.''
To contact the reporter on this story:
Paul Basken in Washington at pbasken@bloomberg.net.
To contact the editor responsible for this story:
Glenn Hall at ghall@bloomberg.net
Last Updated: January 18, 2005 16:16 EST
Jan. 18 (Bloomberg) -- Condoleezza Rice defended the Bush administration against U.S. Senate Democrats' complaints that it misled Americans about the risks of war in Iraq and planned poorly for the postwar occupation.
Rice, who's seeking Senate confirmation as secretary of State, conceded few errors.
``I'm sure that we have made many decisions, some of which were good, some of which might not have been good, but the strategic decision to overthrow Saddam Hussein was the right one,'' she told the Senate Foreign Relations Committee, which is weighing her nomination.
Republicans control the Senate, and lawmakers from both parties say Rice, 50, will be confirmed, possibly as early as Thursday after Bush takes his oath of office for a second term. Democrats used today's hearing to highlight unease with the violence plaguing postwar Iraq, press Rice on U.S. policies toward Iran, North Korea, the Middle East, global warming, the trade deficit and other issues, and urge a more conciliatory approach toward allies.
U.S. relations with many of its oldest allies ``are frankly scraping bottom,'' Joseph Biden of Delaware, the committee's ranking Democrat, said.
``We pay a price for being the world's sole superpower,'' Biden said. ``Today, after a necessary war in Afghanistan and an optional war in Iraq, we are rightly confident in the example of our power. But we have forgotten the power of our example.''
``The time for diplomacy is long overdue,'' he said, even as he pledged to vote for Rice and said he's ``confident'' she'll be confirmed.
`Generational Struggle'
Rice, in her opening statement, pledged to work with other nations in the ``generational struggle'' against terrorism. ``The time for diplomacy is now,'' she said. ``Our interaction with the rest of the world must be a conversation, not a monologue.''
She made no apologies for the war to oust Saddam Hussein, saying U.S. policy since the Sept. 11 attacks has been ``difficult and necessary and right.'' She also said she still doesn't believe the Bush administration used too small a military force for the war and its aftermath.
The U.S. faced ``unforeseen circumstances'' when Iraqi soldiers, rather than stand and fight a superior U.S. army, ``melted into the countryside'' and returned later in the form of a guerrilla insurgency that has cost more than 1,000 U.S. lives.
Kerry's Critique
Democrat John Kerry of Massachusetts, returning to the panel for the first time since his failed bid to unseat Bush as president, said he's ``disturbed'' that Rice still can't concede an error in the size of the military force needed to control Iraq.
Asked by Chuck Hagel, a Republican of Nebraska, to define the U.S. ``exit strategy'' from Iraq, Rice said much depended upon Iraqis achieving political reconciliation following elections set for Jan. 30. ``But that's largely an Iraqi task,'' she said.
Democrat Barbara Boxer of California, challenged Rice's credibility, citing some past statements on Iraq that appeared to contradict subsequent findings, including her prewar warnings that Iraq was stockpiling banned weapons, assisted the al-Qaeda terrorist network, and tried to buy thousands of high-strength aluminum tubes only suitable for nuclear weapons programs.
``This is a pattern of what I see from you,'' Boxer said.
Rice said she ``never ever lost respect for the truth in the service of anything.'' She then told Boxer: `` I really hope that you will refrain from impugning my integrity.''
`Has President's Ear'
Bush recommended Rice, a close personal friend and adviser, to replace Secretary of State Colin Powell, who differed with the president on elements of his Iraq strategy. Bush didn't even consult Powell before deciding to invade Iraq, realizing his opposition, author Bob Woodward wrote in ``Plan of Attack,'' a book based on interviews with top administration officials.
The State Department under Rice ``will have a spokesperson who has president's ear and the president's confidence,'' said James Steinberg, a deputy national security adviser in the Clinton administration who's now director of foreign policy studies at the Brookings Institution, a Washington policy study group.
Democrats said that might not be enough, given the depth of opposition among key U.S. allies to several chief Bush foreign policy positions, starting with the war in Iraq but also including such matters as global warming and economic sanctions.
``The secretary who adopts a unilateralist approach in the international environment may miss important opportunities to prevent conflicts and to build alliances,'' Senator Paul Sarbanes, a Democrat of Maryland, told Rice. ``And in that regard I just note that it's not enough to have the ear of the president. I think the secretary of state must also win the ear of the world.''
Trade Deficit
Sarbanes repeatedly pressed Rice to explain how significant to her job she considered such facts as the increasing U.S. trade deficit and the decreasing rate of net investment in the U.S.
Rice told him such matters were primarily the concern of Bush's economic advisers, though she said the State Department could help by promoting free trade around the world.
``Of course, the strength of the American economy is an important issue for American power, and therefore an important issue for the secretary of State,'' Rice said.
Rice deferred the question of whether Bush should appoint a special envoy to encourage peace between the Israelis and Palestinians. She suggested, however, that the U.S. take a more active rule in helping Palestinian leaders ensure an end to attacks against Israel.
``The restructuring of the Palestinian security forces is something that we have helped with in the past and should now with other neighbors, like Egypt or Jordan, be helping with in the future,'' Rice said.
Courting Venezuela
Rice also criticized Venezuelan President Hugo Chavez, whose country supplies about 15 percent of U.S. oil consumption, for failing to meet U.S. demands on democratic standards. Chavez, Rice said, is ``a democratically elected leader who governs in an illiberal way,'' whose ``government has not been constructive.''
Senator Christopher Dodd, a Democrat of Connecticut, said Rice should try harder with Chavez, noting Brazilian President Luiz Inacio Lula da Silva expressed anti-U.S. sentiments similar to those heard from Chavez before being persuaded to be more cooperative.
``It's a two-way street, Dr. Rice,'' Dodd said. ``It requires we work on it as well.''
Dodd also warned that the stability of some U.S. allies in Latin America is hurt by a Bush administration policy of cutting off military training funds to countries that don't grant the U.S. a waiver from a new international criminal tribunal.
Reshaping Leadership
Rice already has started to reshape the department's leadership, naming U.S. Trade Representative Robert Zoellick as her deputy. They worked together on the National Security Council under former President George H.W. Bush.
There probably will be a renewed dependence upon the State Department to help negotiate U.S. positions abroad, rather than impose them, said Kurt Campbell, a Pentagon and White House official in the Clinton administration.
``Because we are tied down militarily, and that tool is basically exhausted, it's going to mean diplomacy has much more sway,'' said Campbell, director of the international security program at the Center for Strategic and International Studies, a Washington policy study group.
The choice of Zoellick and the likely addition of Philip Zelikow, executive director of Sept. 11 Commission and another colleague of Rice from the previous Bush presidency, suggests she is forming an ``extraordinarily strategic and capable'' team, Campbell said.
Many senators on the committee praised Powell, who was secretary for four years after a 35-year career in the U.S. Army culminating in a term as Chairman of the Joint Chiefs of Staff. Rice called Powell ``my friend and my mentor.''
To contact the reporter on this story:
Paul Basken in Washington at pbasken@bloomberg.net.
To contact the editor responsible for this story:
Glenn Hall at ghall@bloomberg.net
Last Updated: January 18, 2005 16:16 EST
^ Back to vegasmike433's PhotosTuesday, January 18, 200511:13:02 AMViewed 1 time
January 18, 2005Verizon and Yahoo Team Up to Offer Broadband ServiceBy KEN BELSON Verizon Communications, the nation's largest telecommunications company, said yesterday that it planned to work with Yahoo, the Internet search engine, to introduce a portal for its high-speed Internet service.The venture comes as competition for broadband customers between telephone and cable companies continues to heat up. Yahoo is also looking for ways to attract visitors to its Web sites and reduce its reliance on advertising revenue.In the multiyear deal, Verizon's 3.3 million broadband customers will be able to use the co-branded portal at no additional charge. Yahoo will receive an undisclosed share of Verizon's broadband subscription fees, and Verizon will get a share of the advertising revenue generated by the portal.The Yahoo venture comes on top of a similar arrangement Verizon has with MSN, the Microsoft portal. When the Yahoo portal is introduced this summer, Verizon customers will be offered a choice of Verizon, Yahoo or MSN portal as their home page.The arrangement is a less ambitious version of the venture Yahoo has had with SBC Communications since September 2002. In that deal, SBC invested $300 million in Yahoo. SBC and Yahoo are also expanding their partnership. Yahoo is now designing portals for SBC's IP television service and mobile phone service. This will let customers use one ID and password on a variety of electronic devices.Verizon may ultimately do the same thing. The company is installing fiber optic networks that reach customers' homes in nine states. The service, called Fios, includes high-speed Internet connections and phone service. Verizon also intends to provide television on its network.In the meantime, Yahoo hopes to increase revenue from its premium services by making a more direct connection to millions of Verizon customers. Yahoo currently charges fees for e-mail accounts with extra storage and antispam software, commercial-free Internet radio and video services streamed to consumers' computers."We want to get in front of users in a different way," said Steve Boom, senior vice president for broadband access at Yahoo.At the end of the third quarter of 2004, Yahoo had 7.6 million subscribers for its premium services, an 81 percent increase from the same quarter a year earlier. Yahoo reports fourth-quarter and full-year earnings today. For its part, Verizon is battling for broadband customers with cable providers like Comcast and Time Warner Cable. Comcast, which has the most high-speed Internet customers, has increased the speed of its broadband connections without customers paying additional charges. The company has also started offering free video services
Share this picture:
http://vegasmike433.yafro.com/photo/7993954
[Copy Link]
[Click if picture has adult content]
Add a new comment:
January 18, 2005Verizon and Yahoo Team Up to Offer Broadband ServiceBy KEN BELSON Verizon Communications, the nation's largest telecommunications company, said yesterday that it planned to work with Yahoo, the Internet search engine, to introduce a portal for its high-speed Internet service.The venture comes as competition for broadband customers between telephone and cable companies continues to heat up. Yahoo is also looking for ways to attract visitors to its Web sites and reduce its reliance on advertising revenue.In the multiyear deal, Verizon's 3.3 million broadband customers will be able to use the co-branded portal at no additional charge. Yahoo will receive an undisclosed share of Verizon's broadband subscription fees, and Verizon will get a share of the advertising revenue generated by the portal.The Yahoo venture comes on top of a similar arrangement Verizon has with MSN, the Microsoft portal. When the Yahoo portal is introduced this summer, Verizon customers will be offered a choice of Verizon, Yahoo or MSN portal as their home page.The arrangement is a less ambitious version of the venture Yahoo has had with SBC Communications since September 2002. In that deal, SBC invested $300 million in Yahoo. SBC and Yahoo are also expanding their partnership. Yahoo is now designing portals for SBC's IP television service and mobile phone service. This will let customers use one ID and password on a variety of electronic devices.Verizon may ultimately do the same thing. The company is installing fiber optic networks that reach customers' homes in nine states. The service, called Fios, includes high-speed Internet connections and phone service. Verizon also intends to provide television on its network.In the meantime, Yahoo hopes to increase revenue from its premium services by making a more direct connection to millions of Verizon customers. Yahoo currently charges fees for e-mail accounts with extra storage and antispam software, commercial-free Internet radio and video services streamed to consumers' computers."We want to get in front of users in a different way," said Steve Boom, senior vice president for broadband access at Yahoo.At the end of the third quarter of 2004, Yahoo had 7.6 million subscribers for its premium services, an 81 percent increase from the same quarter a year earlier. Yahoo reports fourth-quarter and full-year earnings today. For its part, Verizon is battling for broadband customers with cable providers like Comcast and Time Warner Cable. Comcast, which has the most high-speed Internet customers, has increased the speed of its broadband connections without customers paying additional charges. The company has also started offering free video services
Share this picture:
http://vegasmike433.yafro.com/photo/7993954
[Copy Link]
[Click if picture has adult content]
Add a new comment:
^ Back to vegasmike433's PhotosTuesday, January 18, 200511:03:53 AMViewed 1 time
January 18, 2005WorldCom's Audacious Failure and Its Toll on an IndustryBy KEN BELSON Few executives have helped create and then watched the destruction of as much wealth as Bernard J. Ebbers, the former chief executive of WorldCom. With resolve and salesmanship, but little training in finance or engineering, Mr. Ebbers built one of the world's largest telecommunications companies - at its peak worth $160 billion. Now, with WorldCom in tatters, he stands accused of masterminding a record $11 billion accounting fraud that toppled the company he created and left investors, former employees and others to pick up the pieces.It was the largest bankruptcy ever, measured by WorldCom's $107 billion in assets at the time of its filing for bankruptcy protection in July 2002. And the fallout from WorldCom's implosion includes many other telecommunications companies that staggered or collapsed, in part from trying to keep up with the phantom growth pace set by WorldCom.Once heralded as an outsider who bucked the system and won, Mr. Ebbers has become an outsider in the truest sense: He is millions of dollars in debt, has been widely assailed for his excesses and is treated as an outcast even by some in Mississippi, where WorldCom had its headquarters and where he was once held in esteem for his pluck and foresight. As far as he has fallen, Mr. Ebbers could lose still more if he is convicted of conspiracy, securities fraud and filing false financial reports in a criminal case scheduled to begin today in United States District Court in Manhattan with preliminary motions and the beginning of jury selection. The trial is expected to last about two months. If convicted on all counts, Mr. Ebbers, 63, faces a prison sentence as long as 85 years.Regardless of the case's outcome, Mr. Ebbers's business demise continues to reverberate well beyond the courtroom. WorldCom - doing business again as MCI, the company's original name - is half its former size and struggling to survive. And whether or not one believes that he masterminded an accounting fraud, there is little doubt that the telecommunications industry, whose 1990's boom Mr. Ebbers help fuel with his deal making, is in a shambles - riddled with heavy debt, sagging stock prices and network overcapacity.Phone carriers, emerging from the financial ruins, are relying less on the long-distance and data services that Mr. Ebbers championed, and more on bundles of products like wireless and video that can attract customers with deeper pockets.More broadly, corporate America is coming to terms with life after WorldCom. The company's downfall led Congress to answer critics' calls for action by reviving stalled legislation that became the Sarbanes-Oxley Act of 2002, a sweeping piece of corporate reform legislation. Companies of all sorts are spending millions of dollars to comply with the law, which has increased accountability but, critics say, also stifles innovation."Every publicly traded company can thank Bernie Ebbers for Sarbanes-Oxley and the handcuffs they operate under today," said Scott C. Cleland, a telecommunications analyst at the Precursor Group. "It's everyone else's punishment for his misdeeds."Perhaps those hardest hit, though, are not in boardrooms, but the thousands of former WorldCom employees like Bill Walters, who lost both their jobs and their insurance and pensions. Many of their savings were wiped out by the collapse in the price of the company's stock, and some are still struggling to find work.Mr. Walters, 51, who was a network engineer at WorldCom for 18 years, is relatively lucky. He lost his $300,000 pension, but found work as a technician six months after he was laid off. Happy for the income, he commuted to Houston, returning home to Dallas on weekends to see his wife and two children.But his wife lost her job at Southwest Airlines, and the stress of living apart became too much. He moved home a few weeks ago and now works as a carpenter installing cabinets. Every Friday, he and a dozen or so former WorldCom colleagues meet for lunch at a local restaurant to commiserate, network and wonder what went wrong."At WorldCom, all they talked about was loyalty," Mr. Walters said. "But there's no security, and I doubt there ever will be. We're like an old pencil: You throw it out when it gets too short."Of course, WorldCom did not cause such hardship alone. Global Crossing and 360networks were among many other telecommunications companies that built wildly in the 1990's, and Wall Street investment bankers eagerly financed their fantastic projects. The bankers in turn promoted the sale of shares and bonds to investors eager to believe the promises of unending gains.But Mr. Ebbers was at the center of so much during the telecommunications bubble that he has drawn much blame for its collapse, and not only because of the scale and audacity of the accounting fraud that five of Mr. Ebbers's former subordinates have admitted, or the size of WorldCom's bankruptcy. He engendered deep and lingering resentment in the industry for the brash way he took over companies and the aggressive tactics he used to win contracts and meet profit targets. WorldCom was also among the most vocal cheerleaders for the Internet and the billions of dollars it was supposed to spawn for businesses.Because WorldCom owned UUNet Technologies, the largest carrier of Internet traffic at the time, Mr. Ebbers would seem to have been in a better position than most to gauge the pace of Internet growth. The company's mantra, evoked to justify its investments and growth projections, was that Internet traffic was doubling every 100 days. For a while, that was true. But it was no longer so by the late 90's, though WorldCom executives continued to cite such figures, and this served as the conventional wisdom fueling the demand for Internet and telecommunication stocks."WorldCom's main transgression was to pour gasoline on the Internet fire," said Andrew Odlyzko, a professor at the University of Minnesota who wrote research papers as early as 1998 debunking contentions that Internet growth was so fast. "The technological revolution was pretty powerful as it was," he said. "But WorldCom made it much worse than it would have been."By doing so, Mr. Odlyzko argues, WorldCom contributed to the financial losses suffered by investors in telecommunications stocks well beyond its own shares, and he says WorldCom bears some responsibility for the hundreds of thousands of layoffs that accompanied the downturn. At its peak, WorldCom employed 80,000 people; MCI currently has half as many. Since March 2001, about 300,000 telecommunications workers have lost their jobs. The sector's total employment - 1.032 million - is at an eight-year low.No company became more ensnared in WorldCom's web than its larger rival, AT&T. In the late 90's, AT&T laid off tens of thousands as it tried futilely to match WorldCom's phantom profits. In the name of growth, AT&T also made ill-timed investments, like the $11.3 billion deal to buy the cable operator TCI that in time sped the company's decline. "We were like a greyhound chasing a rabbit," said Dick Martin, an AT&T spokesman then and author of a recent book, "Tough Calls: AT&T and the Hard Lessons Learned from the Telecom Wars." "We spent a lot of time trying to figure how WorldCom could be so much more efficient than we were," he said, "so we went around slashing costs right and left."While AT&T executives scratched their heads, Mr. Ebbers attacked an AT&T stronghold: services for big corporate clients. According to Susan Kalla, an industry analyst at Friedman, Billings, Ramsey, Mr. Ebbers broke ranks with industry custom and started cutting prices by more than 20 percent to win new business, even if it meant losing money on the accounts. But the long-distance telephone industry began to deteriorate so fast - assisted in part by the introduction of cheaper Internet phone service - that AT&T and other long-distance carriers are retreating from the retail service market.Long-distance carriers were not the only ones caught up in a sort of mania. Equipment vendors like Lucent Technologies, Nortel Networks and Corning reaped benefits from WorldCom's wild predictions. From 1998 to 2000, the telecommunications industry issued $323 billion in debt, with about half that money spent on equipment, Ms. Kalla said.But when the market collapsed, equipment vendors reduced their work forces, too. Some, like Nortel, resorted to doctoring their books to meet profit forecasts, inflate their stock prices and stave off bankruptcy.These days, Mr. Ebbers is struggling with his own finances. His fortune once exceeded $1 billion, and, using his WorldCom stock as collateral, he borrowed hundreds of millions of dollars to pay for ranches, timberland, homes and part of a hockey team.Many of those assets have been sold to pay back the loans. But MCI says Mr. Ebbers owes the company more than $400 million, even after it sold his 500,000-acre Canadian ranch and yacht-building business. And while he still holds stakes in several small businesses, Mr. Ebbers must pay for his own legal defense, which may end up costing him millions of dollars.He is also paying personally. Once a star in his hometown near Jackson, Miss., he is now shunned by residents who idolized him when times were good, according to a former WorldCom executive."In Jackson, a lot of people think he's guilty, and think he should go to jail, and feel betrayed and lost a lot of money," the executive said, adding that Mr. Ebbers is rarely seen in the restaurants and clubs where he was once a regular. "It's a pretty strong opinion in town."This group, the executive said, includes former WorldCom employees in Clinton, Miss., where the company had its headquarters, but also people who bought WorldCom stock on the basis of a business story that turned out to be too good to be true
Share this picture:
http://vegasmike433.yafro.com/photo/7993875
[Copy Link]
[Click if picture has adult content]
January 18, 2005WorldCom's Audacious Failure and Its Toll on an IndustryBy KEN BELSON Few executives have helped create and then watched the destruction of as much wealth as Bernard J. Ebbers, the former chief executive of WorldCom. With resolve and salesmanship, but little training in finance or engineering, Mr. Ebbers built one of the world's largest telecommunications companies - at its peak worth $160 billion. Now, with WorldCom in tatters, he stands accused of masterminding a record $11 billion accounting fraud that toppled the company he created and left investors, former employees and others to pick up the pieces.It was the largest bankruptcy ever, measured by WorldCom's $107 billion in assets at the time of its filing for bankruptcy protection in July 2002. And the fallout from WorldCom's implosion includes many other telecommunications companies that staggered or collapsed, in part from trying to keep up with the phantom growth pace set by WorldCom.Once heralded as an outsider who bucked the system and won, Mr. Ebbers has become an outsider in the truest sense: He is millions of dollars in debt, has been widely assailed for his excesses and is treated as an outcast even by some in Mississippi, where WorldCom had its headquarters and where he was once held in esteem for his pluck and foresight. As far as he has fallen, Mr. Ebbers could lose still more if he is convicted of conspiracy, securities fraud and filing false financial reports in a criminal case scheduled to begin today in United States District Court in Manhattan with preliminary motions and the beginning of jury selection. The trial is expected to last about two months. If convicted on all counts, Mr. Ebbers, 63, faces a prison sentence as long as 85 years.Regardless of the case's outcome, Mr. Ebbers's business demise continues to reverberate well beyond the courtroom. WorldCom - doing business again as MCI, the company's original name - is half its former size and struggling to survive. And whether or not one believes that he masterminded an accounting fraud, there is little doubt that the telecommunications industry, whose 1990's boom Mr. Ebbers help fuel with his deal making, is in a shambles - riddled with heavy debt, sagging stock prices and network overcapacity.Phone carriers, emerging from the financial ruins, are relying less on the long-distance and data services that Mr. Ebbers championed, and more on bundles of products like wireless and video that can attract customers with deeper pockets.More broadly, corporate America is coming to terms with life after WorldCom. The company's downfall led Congress to answer critics' calls for action by reviving stalled legislation that became the Sarbanes-Oxley Act of 2002, a sweeping piece of corporate reform legislation. Companies of all sorts are spending millions of dollars to comply with the law, which has increased accountability but, critics say, also stifles innovation."Every publicly traded company can thank Bernie Ebbers for Sarbanes-Oxley and the handcuffs they operate under today," said Scott C. Cleland, a telecommunications analyst at the Precursor Group. "It's everyone else's punishment for his misdeeds."Perhaps those hardest hit, though, are not in boardrooms, but the thousands of former WorldCom employees like Bill Walters, who lost both their jobs and their insurance and pensions. Many of their savings were wiped out by the collapse in the price of the company's stock, and some are still struggling to find work.Mr. Walters, 51, who was a network engineer at WorldCom for 18 years, is relatively lucky. He lost his $300,000 pension, but found work as a technician six months after he was laid off. Happy for the income, he commuted to Houston, returning home to Dallas on weekends to see his wife and two children.But his wife lost her job at Southwest Airlines, and the stress of living apart became too much. He moved home a few weeks ago and now works as a carpenter installing cabinets. Every Friday, he and a dozen or so former WorldCom colleagues meet for lunch at a local restaurant to commiserate, network and wonder what went wrong."At WorldCom, all they talked about was loyalty," Mr. Walters said. "But there's no security, and I doubt there ever will be. We're like an old pencil: You throw it out when it gets too short."Of course, WorldCom did not cause such hardship alone. Global Crossing and 360networks were among many other telecommunications companies that built wildly in the 1990's, and Wall Street investment bankers eagerly financed their fantastic projects. The bankers in turn promoted the sale of shares and bonds to investors eager to believe the promises of unending gains.But Mr. Ebbers was at the center of so much during the telecommunications bubble that he has drawn much blame for its collapse, and not only because of the scale and audacity of the accounting fraud that five of Mr. Ebbers's former subordinates have admitted, or the size of WorldCom's bankruptcy. He engendered deep and lingering resentment in the industry for the brash way he took over companies and the aggressive tactics he used to win contracts and meet profit targets. WorldCom was also among the most vocal cheerleaders for the Internet and the billions of dollars it was supposed to spawn for businesses.Because WorldCom owned UUNet Technologies, the largest carrier of Internet traffic at the time, Mr. Ebbers would seem to have been in a better position than most to gauge the pace of Internet growth. The company's mantra, evoked to justify its investments and growth projections, was that Internet traffic was doubling every 100 days. For a while, that was true. But it was no longer so by the late 90's, though WorldCom executives continued to cite such figures, and this served as the conventional wisdom fueling the demand for Internet and telecommunication stocks."WorldCom's main transgression was to pour gasoline on the Internet fire," said Andrew Odlyzko, a professor at the University of Minnesota who wrote research papers as early as 1998 debunking contentions that Internet growth was so fast. "The technological revolution was pretty powerful as it was," he said. "But WorldCom made it much worse than it would have been."By doing so, Mr. Odlyzko argues, WorldCom contributed to the financial losses suffered by investors in telecommunications stocks well beyond its own shares, and he says WorldCom bears some responsibility for the hundreds of thousands of layoffs that accompanied the downturn. At its peak, WorldCom employed 80,000 people; MCI currently has half as many. Since March 2001, about 300,000 telecommunications workers have lost their jobs. The sector's total employment - 1.032 million - is at an eight-year low.No company became more ensnared in WorldCom's web than its larger rival, AT&T. In the late 90's, AT&T laid off tens of thousands as it tried futilely to match WorldCom's phantom profits. In the name of growth, AT&T also made ill-timed investments, like the $11.3 billion deal to buy the cable operator TCI that in time sped the company's decline. "We were like a greyhound chasing a rabbit," said Dick Martin, an AT&T spokesman then and author of a recent book, "Tough Calls: AT&T and the Hard Lessons Learned from the Telecom Wars." "We spent a lot of time trying to figure how WorldCom could be so much more efficient than we were," he said, "so we went around slashing costs right and left."While AT&T executives scratched their heads, Mr. Ebbers attacked an AT&T stronghold: services for big corporate clients. According to Susan Kalla, an industry analyst at Friedman, Billings, Ramsey, Mr. Ebbers broke ranks with industry custom and started cutting prices by more than 20 percent to win new business, even if it meant losing money on the accounts. But the long-distance telephone industry began to deteriorate so fast - assisted in part by the introduction of cheaper Internet phone service - that AT&T and other long-distance carriers are retreating from the retail service market.Long-distance carriers were not the only ones caught up in a sort of mania. Equipment vendors like Lucent Technologies, Nortel Networks and Corning reaped benefits from WorldCom's wild predictions. From 1998 to 2000, the telecommunications industry issued $323 billion in debt, with about half that money spent on equipment, Ms. Kalla said.But when the market collapsed, equipment vendors reduced their work forces, too. Some, like Nortel, resorted to doctoring their books to meet profit forecasts, inflate their stock prices and stave off bankruptcy.These days, Mr. Ebbers is struggling with his own finances. His fortune once exceeded $1 billion, and, using his WorldCom stock as collateral, he borrowed hundreds of millions of dollars to pay for ranches, timberland, homes and part of a hockey team.Many of those assets have been sold to pay back the loans. But MCI says Mr. Ebbers owes the company more than $400 million, even after it sold his 500,000-acre Canadian ranch and yacht-building business. And while he still holds stakes in several small businesses, Mr. Ebbers must pay for his own legal defense, which may end up costing him millions of dollars.He is also paying personally. Once a star in his hometown near Jackson, Miss., he is now shunned by residents who idolized him when times were good, according to a former WorldCom executive."In Jackson, a lot of people think he's guilty, and think he should go to jail, and feel betrayed and lost a lot of money," the executive said, adding that Mr. Ebbers is rarely seen in the restaurants and clubs where he was once a regular. "It's a pretty strong opinion in town."This group, the executive said, includes former WorldCom employees in Clinton, Miss., where the company had its headquarters, but also people who bought WorldCom stock on the basis of a business story that turned out to be too good to be true
Share this picture:
http://vegasmike433.yafro.com/photo/7993875
[Copy Link]
[Click if picture has adult content]
^ Back to vegasmike433's PhotosTuesday, January 18, 200510:41:52 AMViewed 2 times
Vatican: Kidnapped Iraq Bishop Freed; No RansomTue Jan 18, 8:38 AM ET By Philip Pullella VATICAN CITY (Reuters) - The Iraqi Catholic archbishop of Mosul who was kidnapped at gunpoint on Monday was freed on Tuesday morning without a ransom being paid, the Vatican (news - web sites) said. Vatican spokesman Joaquin Navarro-Valls said Pope John Paul (news - web sites) was immediately informed of the release of Archbishop Basile Georges Casmoussa, 66, and "thanked God for the happy ending to this episode." In expressing the Vatican's "great satisfaction," he confirmed reports from Iraq (news - web sites) that no ransom had been paid. Misna, a Rome-based Catholic missionary news agency with extensive contacts in the developing world, earlier reported the kidnappers had demanded a ransom of $200,000. The Vatican announced the kidnapping -- which it had branded an "act of terrorism" -- on Monday night and demanded the immediate release of the archbishop. Casmoussa was kidnapped by gunmen in two cars in the northern al-Majmoua al-Thaqafiya district of Iraq's third largest city on Tuesday afternoon while he was on his way to visit some families from his congregation. Navarro-Valls, the Vatican spokesman, said the kidnapping had "prompted great surprise" because Casmoussa was "very much loved" by both the Christian and Muslim community. Casmoussa was believed to have been the highest ranking Catholic prelate to be abducted in Iraq, where the local church has been the target of a bombing campaign aimed at intimidating the tiny Christian minority. ANCIENT CHURCHES Most of Iraq's Christians, who make up some three percent of the 25 million population, belong to the early Assyrian and Chaldean Catholic churches. The Vatican strongly opposed the U.S.-led invasion of Iraq. While Christians had little political power under Saddam Hussein (news - web sites), they were free to worship and did not feel threatened by sectarian violence. But Iraq's 650,000 or so Christians have been trickling out of their ancient homeland since the U.S.-led invasion in 2003 as insurgents step up attacks against both Muslim and Christian holy places in an apparent bid to inflame sectarian tension. On Aug. 1 five churches in Baghdad and the northern city of Mosul were bombed in coordinated attacks that killed 12 people. Five Baghdad churches were bombed on the Oct. 16 start of the Muslim holy month of Ramadan. Eight were killed in two church bombings on Nov. 8. Midnight Mass was canceled last Christmas, as several cities were under curfew and Iraq's Christian religious leaders feared renewed attacks. Last month the Vatican's foreign minister warned that anti-Christian feeling was spreading in Iraq and other Muslim countries because of the war on terrorism. Archbishop Giovanni Lajolo, the Vatican's second-ranking diplomat, said anti-Christian feeling existed where political strategies of Western countries were believed to be driven by Christianity.
Share this picture:
http://vegasmike433.yafro.com/photo/7993490
[Copy
Vatican: Kidnapped Iraq Bishop Freed; No RansomTue Jan 18, 8:38 AM ET By Philip Pullella VATICAN CITY (Reuters) - The Iraqi Catholic archbishop of Mosul who was kidnapped at gunpoint on Monday was freed on Tuesday morning without a ransom being paid, the Vatican (news - web sites) said. Vatican spokesman Joaquin Navarro-Valls said Pope John Paul (news - web sites) was immediately informed of the release of Archbishop Basile Georges Casmoussa, 66, and "thanked God for the happy ending to this episode." In expressing the Vatican's "great satisfaction," he confirmed reports from Iraq (news - web sites) that no ransom had been paid. Misna, a Rome-based Catholic missionary news agency with extensive contacts in the developing world, earlier reported the kidnappers had demanded a ransom of $200,000. The Vatican announced the kidnapping -- which it had branded an "act of terrorism" -- on Monday night and demanded the immediate release of the archbishop. Casmoussa was kidnapped by gunmen in two cars in the northern al-Majmoua al-Thaqafiya district of Iraq's third largest city on Tuesday afternoon while he was on his way to visit some families from his congregation. Navarro-Valls, the Vatican spokesman, said the kidnapping had "prompted great surprise" because Casmoussa was "very much loved" by both the Christian and Muslim community. Casmoussa was believed to have been the highest ranking Catholic prelate to be abducted in Iraq, where the local church has been the target of a bombing campaign aimed at intimidating the tiny Christian minority. ANCIENT CHURCHES Most of Iraq's Christians, who make up some three percent of the 25 million population, belong to the early Assyrian and Chaldean Catholic churches. The Vatican strongly opposed the U.S.-led invasion of Iraq. While Christians had little political power under Saddam Hussein (news - web sites), they were free to worship and did not feel threatened by sectarian violence. But Iraq's 650,000 or so Christians have been trickling out of their ancient homeland since the U.S.-led invasion in 2003 as insurgents step up attacks against both Muslim and Christian holy places in an apparent bid to inflame sectarian tension. On Aug. 1 five churches in Baghdad and the northern city of Mosul were bombed in coordinated attacks that killed 12 people. Five Baghdad churches were bombed on the Oct. 16 start of the Muslim holy month of Ramadan. Eight were killed in two church bombings on Nov. 8. Midnight Mass was canceled last Christmas, as several cities were under curfew and Iraq's Christian religious leaders feared renewed attacks. Last month the Vatican's foreign minister warned that anti-Christian feeling was spreading in Iraq and other Muslim countries because of the war on terrorism. Archbishop Giovanni Lajolo, the Vatican's second-ranking diplomat, said anti-Christian feeling existed where political strategies of Western countries were believed to be driven by Christianity.
Share this picture:
http://vegasmike433.yafro.com/photo/7993490
[Copy
today's papersBishop TakenBy Eric UmanskyPosted Tuesday, Jan. 18, 2005, at 12:29 AM PT
USA Today and the Wall Street Journal's world-wide newsbox lead with the latest violence from Iraq, including the kidnapping of the archbishop of Mosul. USAT says other 15 Iraqis were killed, the Journal says at least 22, and the Los Angeles Times says at least 28. Two Marines were also killed; spokesmen wouldn't say exactly where. According to early-morning reports, a suicide car bomber hit the Baghdad HQ of one of Iraq's leading Shiite parties, killing at least three. The Washington Post leads with a poll showing mixed numbers for President Bush. Fifty-eight percent of respondents said they disapprove of his handling of Iraq, and 55 percent said they don't like how he's handled "the Social Security issue." But a slight majority, 54 percent, said they support some sort of privatization plan. And if it matters to you, the president's job approval rating is 52 percent.
The LAT leads with some politicians and observers doubting the president's repeated recent assertions that he's serious about pushing his guest-worker proposal or that he can pull it off in any case. The New York Times leads with word that the U.S. has quietly penalized eight major Chinese companies for helping Iran with its apparent nukes program. The current White House has apparently followed the Clinton administration's habit of trying to play down what one official described as China's "serial proliferator problem." The latest penalties didn't get a press release; they just showed up in page 133 of the Federal Register.
Most of the Iraqis killed yesterday died in two attacks: Seven police were killed when their minibus was ambushed in Baquba and another seven were killed by a suicide car bombing in Baji , north of Baghdad. A suicide bomber also hit a Marine patrol in Ramadi. That's likely where the two Marines were killed, but again, spokesmen would only say they died somewhere in the region.
In the far southern city of Basra, insurgents shelled a few polling places overnight, including a kindergarten. Nobody was wounded. The Post says guerrillas also attacked polling stations in two other towns, including Mosul. (Insurgents have also apparently been threatening schools recently.)
The LAT notices that the attack Basra is the latest in a trend and "demonstrated anew an ability to strike in the relatively peaceful south."
Echoing a report in Sunday's NYT, the LAT says military commanders are now saying they're going to shift resources away from any offensives and towards training Iraqis. The apparent change, which has been touted once or two before, comes as commanders and even SAOs acknowledge GIs can't beat the insurgency on their own. Offensives "are not the long-term solution," said a senior administration official. "Training Iraqis is the whole nine yards right now. If they don't get better, we can't get out of there."
Everybody mentions Palestinian President Mahmoud Abbas ordering Palestinian security services to make "maximum efforts" against militants. Abbas is heading to Gaza to talk with Hamas and Islamic Jihad. The NYT notes that the rare previous efforts by Palestinian security forces to crack down "have been halfhearted and never sustained."
The Post fronts Chinese leaders struggling with how to respond to the death of Zhao Ziyang, a former party leader who disagreed with the Tiananmen Square crackdown and had been under house arrest for 15 years because of it. The WP says chat-room "users posted hundreds, if not thousands, of notes of sorrow, only to watch as censors deleted most of them quickly." The Journal doesn't dwell on any outpouring, saying China's rocketing economy has created an ownership society, with university students more interested in "jobs, fashion, and entertainment" than democracy.
A frontpage NYT piece looks at the "potentially pivotal role" Vice President Cheney is playing in shaping the administration's domestic policy agenda. On Social Security, he reportedly favors allowing people to divert nearly half their payroll taxes into private accounts, just what conservatives have been pushing. He also reportedly supports cuts in benefits.
The LAT looks at how the White House's push for faith-based social services helped Bush win a bit more support among African-Americans, particularly in places like...Ohio.
The NYT fronts and Post stuffs a U.N. report concluding that rich countries can meet their (sort of) promise to halve extreme global poverty if they increase their international aid to about half of one percent of GDP, up from the current average of .25 percent. The difference would be about $50 billion annually and could save millions of lives. The U.S. currently clocks in at about .15 percent, last among rich nations.
The Post fronts Homeland Security
USA Today and the Wall Street Journal's world-wide newsbox lead with the latest violence from Iraq, including the kidnapping of the archbishop of Mosul. USAT says other 15 Iraqis were killed, the Journal says at least 22, and the Los Angeles Times says at least 28. Two Marines were also killed; spokesmen wouldn't say exactly where. According to early-morning reports, a suicide car bomber hit the Baghdad HQ of one of Iraq's leading Shiite parties, killing at least three. The Washington Post leads with a poll showing mixed numbers for President Bush. Fifty-eight percent of respondents said they disapprove of his handling of Iraq, and 55 percent said they don't like how he's handled "the Social Security issue." But a slight majority, 54 percent, said they support some sort of privatization plan. And if it matters to you, the president's job approval rating is 52 percent.
The LAT leads with some politicians and observers doubting the president's repeated recent assertions that he's serious about pushing his guest-worker proposal or that he can pull it off in any case. The New York Times leads with word that the U.S. has quietly penalized eight major Chinese companies for helping Iran with its apparent nukes program. The current White House has apparently followed the Clinton administration's habit of trying to play down what one official described as China's "serial proliferator problem." The latest penalties didn't get a press release; they just showed up in page 133 of the Federal Register.
Most of the Iraqis killed yesterday died in two attacks: Seven police were killed when their minibus was ambushed in Baquba and another seven were killed by a suicide car bombing in Baji , north of Baghdad. A suicide bomber also hit a Marine patrol in Ramadi. That's likely where the two Marines were killed, but again, spokesmen would only say they died somewhere in the region.
In the far southern city of Basra, insurgents shelled a few polling places overnight, including a kindergarten. Nobody was wounded. The Post says guerrillas also attacked polling stations in two other towns, including Mosul. (Insurgents have also apparently been threatening schools recently.)
The LAT notices that the attack Basra is the latest in a trend and "demonstrated anew an ability to strike in the relatively peaceful south."
Echoing a report in Sunday's NYT, the LAT says military commanders are now saying they're going to shift resources away from any offensives and towards training Iraqis. The apparent change, which has been touted once or two before, comes as commanders and even SAOs acknowledge GIs can't beat the insurgency on their own. Offensives "are not the long-term solution," said a senior administration official. "Training Iraqis is the whole nine yards right now. If they don't get better, we can't get out of there."
Everybody mentions Palestinian President Mahmoud Abbas ordering Palestinian security services to make "maximum efforts" against militants. Abbas is heading to Gaza to talk with Hamas and Islamic Jihad. The NYT notes that the rare previous efforts by Palestinian security forces to crack down "have been halfhearted and never sustained."
The Post fronts Chinese leaders struggling with how to respond to the death of Zhao Ziyang, a former party leader who disagreed with the Tiananmen Square crackdown and had been under house arrest for 15 years because of it. The WP says chat-room "users posted hundreds, if not thousands, of notes of sorrow, only to watch as censors deleted most of them quickly." The Journal doesn't dwell on any outpouring, saying China's rocketing economy has created an ownership society, with university students more interested in "jobs, fashion, and entertainment" than democracy.
A frontpage NYT piece looks at the "potentially pivotal role" Vice President Cheney is playing in shaping the administration's domestic policy agenda. On Social Security, he reportedly favors allowing people to divert nearly half their payroll taxes into private accounts, just what conservatives have been pushing. He also reportedly supports cuts in benefits.
The LAT looks at how the White House's push for faith-based social services helped Bush win a bit more support among African-Americans, particularly in places like...Ohio.
The NYT fronts and Post stuffs a U.N. report concluding that rich countries can meet their (sort of) promise to halve extreme global poverty if they increase their international aid to about half of one percent of GDP, up from the current average of .25 percent. The difference would be about $50 billion annually and could save millions of lives. The U.S. currently clocks in at about .15 percent, last among rich nations.
The Post fronts Homeland Security
