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November 11, 2008 - Image 3

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Tuesday, November 11, 2008 - 3A

The Michigan Daily - michigandailycom Tuesday, November11, 2008 - 3A

NEWS BRIEFS
WASILLA, Alaska
Pali blames Bush
policies for GOP
defeat
Alaska Gov. Sarah Palin, amid
speculation she'll run for presi-
dent in four years, blamed Bush
administration policies for the
defeat last week of the GOP ticket
and prayed she wouldn't miss "an
open door" for her next political
opportunity.
"I'm like, OK, God, if there is
an open door for me somewhere,
this is what I always pray, I'm like,
don't let me miss the open door,"
Palin said in an interview with Fox
News on Monday. "And if there is
an open door in '12 or four years
later, and if it is something that
is going to be good for my fam-
ily, for my state, for my nation, an
opportunity for me, then I'll plow
through that door."
In a wide-ranging interview
with Fox's Greta Van Susteren,
Palin says she neither wanted nor
asked for the $150,000-plus ward-
robe the Republican Party bank-
rolled, and thought the issue was
an odd one at the end of the cam-
paign, considering "what is going
on in the world today."
WASHINGTON
Obama plans U.S.
terror trials to
replace Guantanamo
President-elect Obama's advis-
ers are crafting plans to close the
Guantanamo Bay prison and pros-
ecute terrorism suspects in the
U.S., a plan the Bush administra-
tion said yesterday was easier said
than done.
Under the plan being crafted in-
side Obama's camp, some detain-
ees would be released and others
would be charged in U.S. courts,
where they would receive con-
stitutional rights and open trials.
But, underscoring the difficult de-
cisions Obama must make to fulfill
his pledge of shutting down Guan-
tanamo, the plan could require the
creation of a new legal system to
handle the classified information
inherent in some of the most sen-
sitive cases.
Many of the about 250 Guan-
tanamo detainees are cleared for
release, but the Bush administra-
tion has not able been to find a
country willing to take them.
Advisers participating directly
in the planning spoke on condition
of anonymity because the plans
aren't final.
WASHINGTON
Sen. Feinstein:
Don't scalp Obama
inauguration tickets
The senator overseeing Barack
Obama's swearing-in ceremony
said yesterday she's writing to
Internet sites like eBay asking
them not to sell scalped inaugura-
tion tickets.

Sen. Dianne Feinstein, D-Calif.,
lso said she's crafting a bill that
would make a federal crime of
selling tickets to the historic event
Jan. 20.
Feinstein, who chairs the Joint
Congressional Committee on Inau-
gural Ceremonies, said she fore-
sees overwhelming demand for the
240,000 available tickets and has
heard reports they may be sold for
as much as $40,000 online.
The tickets are supposed to be
free to the public and distributed
through congressional offices.
Lawmakers' offices won't get
the tickets until shortly before
the inauguration, to try to prevent
scalping. In-person pickup will be
tequired.
BOSTON
Amid economic
turmoil, Harvard to
cut spending
Harvard University is consid-
eting .spending cuts because the
economic slowdown may reduce
federal grants and the school's
substantial endowment, President
Drew Faust said Monday.
Harvard's endowment posted
an 8.6 percent return and grew to
$36.9 billion in the fiscal year that
ended June 30. The school, how-
ever, lost 12.7 percent on its U.S.
tock portfolio and 12.1 percent on
its foreign equity portfolio during
that time. Faust's spokesman on
Monday declined to say much the
endowment has lost during the
current economic turmoil.
- Compiled from
Daily wire reports

Bush, Obama meet at White Fed's bailout for AIG
House to prep for transition swells beyond $150B

Bush, Obama
families meet for
first time
WASHINGTON (AP) - All
smiles and compliments, Pres-
ident-elect Obama and his wife,
Michelle, called on President Bush
and first lady Laura Bush yesterday
in a White House visit that was
part political ritual, part practical
introduction and a striking symbol
of the historic transfer of power to
come.
The president and Obama talk-
ed war and financial crisis. Laura
Bush and Michelle Obama talked
about raising daughters in the
nation's most famous house.
Then Obama flew back to Chi-
cago to work on setting up the new
administration that will take over
on Jan. 20.
Mrs. Obama went out hunting
a new school for the kids, visiting
two ofthecapitalcity'sbest-known
private schools.
If first impressions matter,
Obama and his wife displayed one
similarity to the super-punctual
Bushes, pulling up to the White
House's South Portico 11 minutes
early. The couples traded warm
and easy greetings in the crisp
autumn sunshine, with the wives
exchanging pleasantries about the
fall hues each wore - Mrs. Bush in
a brown dress and Mrs. Obama in
a red one.
While Obama and Bush, in busi-
ness suits, proceeded waving and
smiling down the White House
Colonnade for nearly two hours
of private talks, Mrs. Obama and
Mrs. Bush had their own agenda:
talk of raising children in most
unusual circumstances. Mrs. Bush
conducted a tour of the living quar-
ters of the historic mansion and
made introductions to the army of
residence staff who look after first
families.
Michelle Obama had toured the
White House before with daugh-
ters Malia, who is 10, and Sasha,
who is 7. But the two women had
never met.
The 43rd president and the man
who will be the 44th - and first
black - commander in chief met
alone in the Oval office, with no
handlers or staff. It was Obama's
first time in the storied work-
space, even though he had been
to the White House previously for
events.
Neither the Bushes nor the
Obamas spoke to reporters, and
details about their meetings were
few.
Obamaspokesman Robert Gibbs
said the two men "talked exten-
sively" about the economic situa-
tion and foreign policy.
"Obviously the topics that came
up are what you've seen and heard
about in the news recently and
about what a number of transition
officials spoke about on the Sunday
(TV talk) shows," he said.
Topics included "the need to get
the economy back on track," Gibbs
said, and "what's going on in the
auto industry." The discussion on
the auto industry wasn't limited to
just one of the nation's three larg-
est car makers, he said. "It was a
discussion about the broad health
of the industry, and they also spoke
about the housing industry and
foreclosures."
As for Obama's first glimpse of
the Oval Office: "He said it was a

very, very nice office," Gibbs said.
White House press secre-
tary Dana Perino said that Bush
described the meeting as "con-
structive, relaxed and friendly,"
covering problems at home and
abroad, and that he personally
pledged a smooth transition. Bush
gave Obama a sneak peek at White
House highlights, such as the Lin-
coln Bedroom and the president's
office in the residence, after their
hour-plus in the Oval Office.
Such White House meetings
have a history going back decades.

President-elect Barack Obama and President George W. Bush met at the White
House for the first time yesterday.

They are discussions that can
range wherever the two men
choose, whether focused on spe-
cific issues, how best to make deci-
sions, the extraordinary resources
that accompany any American
president, the special weight of the
office or even the secrets about the
building that few people are privy
to. It's also a chance to establish
personal rapport between near-
strangers, though that is by no
means guaranteed.
Michelle Obama arrived in
Washington before her husband
and stayed awhile after left, check-
ing out schools.
In the morning, she visited
Georgetown Day School. Then
in the late afternoon she toured
Sidwell Friends School, which
Chelsea Clinton attended when her
parents were in the White House.
The Obamas' children now
attenda private school in Chicago..
At the White House, while Bush
and Obama talked, parallel confabs
went on all around the building.
Bush chief of staff Josh Bolten
and Obama transition manager
John Podesta, himself a former
White House chief of staff under
President Clinton, held their own
talks after standing off to the side
togetherinthe Rose Gardenwatch-
ing their bosses walk by. Obama's
likely White House press secre-
tary, Gibbs, got a glimpse of the
West Wing digs he probably will
occupy - including a fancy bank of
television screens on one wall.
Outside, crowds built through-
out the day with people pressing
their noses through the fencing
around the White House complex
in hopes of getting a glimpse of the
first family to be. Street vendors
operating nearby were already
stocked with Obama-related mer-
chandise.
Obama traveled the streets of
Washington and up the White
House drive in a motorcade
upgraded from campaign mode
to full-blown presidential level.
There were the two identicalblack,
heavily armored limousines - one
a decoy - like those Bush rides
in, only without the seal or flying
flags. There was also a hazardous
materials truck, a communications
vehicle and an ominous-looking,
armed-to-the-teeth counterassault
team filling the seats of an open-
windowed Suburban.
Obama's staff, most in suits,
remarked they had needed to buy
"grown-up clothes" that better
befitted a White House visit than
the smart casual look they had
adopted for the campaign plane.

Even the entourage's ever-cheer-
ful luggage handler donned a coat
and tie for the day, though he didn't
come along to the White House.
And there was one small but
unmistakable sign that it will
be Obama who will be in charge
before too long: He put his left
hand on Bush's back as they went
inside the building from Obama's
motorcade, as if he was guiding the
president into his own house.
Later, as he sat on his plane wait-
ing for takeoff, he was heard to say
into his cell phone: "I'm not going
to be spending too much time in
Washington over the next several
weeks."
These White House sessions
hare designed to putthe presidency
above politics, temporarily at least.
This year's took place less than a
week after Election Day, giving less
time than usual for raw campaign
words to fade.
But both Bush and Obama have
set a tone of graciousness and
cooperation that has surprised -
and pleased - many observers.
Obamahas shownno inclination
for gloating. And Bush has been
notably generous in his comments
since the election.
On a practical - and sober -
level, Obama is taking office with
the economy in deep turmoil and
two wars that are far from won,
among other problems.
Comity aside, there are plenty of
tension points.
Bushand Obamamet asthe main
transition news of the day was the
Democratic team's preparations to
rescind many of the incumbent's
executive orders. Podesta said
Obama's aides were poring over all
of them and will make such rever-
sals among the new president's
first acts.
"We need to get off the course
that the Bush administration has
set," Podesta said, delivering a con-
crete rebuke of Bush only about 24
hours before the two men sat down
together.
Obama spokeswoman Stepha-
nie Cutter said in a statement
that Obama "will honor the com-
mitment he made during the
campaign to review all execu-
tive orders, but this process has
not yet begun and no decisions
have been made. The President-
elect has pledged to run an open
and inclusive government, so
before he makes any decisions
on potential executive or legisla-
tive actions, he will be conferring
with congressional leaders on
both sides of the aisle, as well as
interested groups."

AIG lost $24.5 billion
in third quarter
WASHINGTON (AP) - When
the government offered an emer-
gency. loan to insurer American
International Group in September,
eyebrows shot up at the $85 billion
price tag. Now it looks like pocket
change.
The size of the AIG lifeline
swelled to more than $150 bil-
lion on Monday, a record for a
private company. But the head of
the broader financial rescue pack-
age was cool to other companies
reaching for a piece of the bailout
pie.
The new AIG package includes
a $40 billion chunk of the $700 bil-
lion financial bailout. It's the first
time money from the big rescue
bill has goneto any company other
than a bank.
General Motors, Ford and
Chrysler, burning through cash
and bleeding jobs, are prodding
the government for more help.
The leaders of the House and
Senate have urged Treasury
Secretary Henry Paulson to get
some of the $700 billion to the
Big Three.
The automakers, covering all
their options, are also pushing to
get help as part of a new, multi-
billion-dollar stimulus package
for the economy if Democrats
push it through Congress when a
lame-duck session convenes next
week.
President-elect Barack Obama
has said his transition team would
explore options to provide relief to
the auto industry, and President
Bush's press secretary said Mon-
day the White House would "lis-
ten to" Congress if they try to help
automakers.
Any money would be on top of
the $25 billion in loans that Con-
gress passed in September to help
retool auto plants to build more
fuel-efficient vehicles.
NeelKashkari, the interim head
of the $700 billion bailout pro-
gram, was cool to the idea of fun-
neling the money to companies
beyond banks and AIG.
"This morning's action with
AIG was a one-off event necessary
for financial stability. It is not the
establishrant of a new program"
he said at a financial conference in
New York.
In a separate development
late Monday, the Fed granted the
request of credit card company
American Express Co. to become a
bank holding company.
Although the new status will
subject the company to greater
regulatory scrutiny, American
Express will also gain access to the
Fed's emergency lending program.
The company, which last month
announced plans to slash its global
work force, has been hard hit by
the credit crisis as even the more
affluent consumers the company
caters to struggle to pay off their
debts.
The original Fed loan to AIG
was $85 billion, and the Fed added
a $38 billion loan in October. But
that has not been enough to firm
up the company, which is so big
and interconnected to other firms
that its failure would devastate the
economy.
Under the new plan, the Fed
will provide $60 billion in loans.
The Treasury will provide $40Obil-
lion to buyup preferred stock.
And the government will spend

close to $53 billion to buy up mort-

'gage-backed assets and other AIG
contracts on debt.
Total package: $153 billion. And
AIG has also taken advantage of a
federal plan to buy up short-term
debt routinely issued by compa-
nies, known as commercial paper.
The $40 billion going to AIG
will buy preferred shares of com-
pany stock, giving taxpayers an
ownership stake. In turn, restric-
tions will be placed on executive
pay at the firm.
The Fed stepped in with an $85
billion loan in September because
the company is so big - linked
to mutual funds and retirement
products held by millions of
Americans, not to mention ties
to U.S. mortgages - that its fail-
ure would have devastated the
economy.
"The bailout continues, and
essentially exemplifies the notion
of 'too big to fail,' said Anthony
Sabino, a professor of law and
business at St. John's University.
"But the question must be asked:
Where does it end?"
AIG also came under fire for
spending hundreds of thou-
sands of dollars on a California
retreat just days after the Fed
loan was announced in Septem-
ber.
In other bailout news Mon-
day, mortgage finance company
Fannie Mae said it may have to
tap a $100 billion government
lifeline as early as next year
after posting a massive third-
quarter loss.
Fannie Mae, seized by federal
regulators more than two months
ago, posted a staggering loss of $13
per share for the July-to-Septem-
ber quarter, compared with a loss
$1.56 a share, for the same period
last year.
The company's net worth -
what it owns minus what it owes
- fell to $9.4 billion at the end of
September, from $44.1 billion at
the end of last year.
If that number turns nega-
tive, Fannie Mae said it would be
required to tap Treasury for help.
The new package for AIG was
unveiled as the insurer issued
new, bleak quarterly results.
It lost $24.5 billion in the third
quarter after turning a $3.1 bil-
lion profit in the third quarter of
2007.
Under the restructuring, AIG
also gets easier terms on the Fed
loans, reducing the risk AIG will
have to sell off assets at firesale
prices to pay back the govern-
ment.
"This is a very big deal for AIG.
It essentially plugs two of the big-
gest holes that the company had,"
said Rob Haines, analyst at Cred-
itSights.
Fed officials expressed con-
fidence the money would even-
tually be repaid to taxpayers,
and presidential press secre-
tary Dana Perino said it would
also be good for the fragile U.S.
economy.
The federal help "will allow
AIG to continue to restructure
themselves in a way that will not
hurt the overall economy. AIG is
a large, interconnected firm," she
said.
AIG Chief Executive Edward
Liddy called the plan a "win-win."
"It sends a strong signal to
our policy holders, to govern-
ment, to regulators around the
world, to our business partners
and counterparts that AIG is in
fact on the road to recovery," he

said.

Canada open to auto
bailout, watching U.S.

NASA: Phoenix mission to Mars has ended

Mission lasted five
months, cost $475M
LOS ANGELES (AP) - NASA
yesterday declared an end to
the Phoenix mission, some five
months after the spacecraft
became the first to land in Mars'
arctic plains and taste water on
another planet.
Mission engineers have not
heard from the Phoenix lander in
over a week. It fell silent shortly
after a raging dust storm blocked
sunlight from reaching its solar
panels.
Although ground controllers
will direct two satellites orbit-
ing Mars to listen for Phoenix for
several more weeks, the chances

that it will respond are slim.
"We are actually ceasingopera-
tions, declaring an end of mission
operations at this point," said
project manager Barry Goldstein
of NASA's Jet Propulsion Labo-
ratory, which managed the $475
million mission.
Phoenix's demise was predicted.
Unlike its hardytwinrovercousins
Spirit and opportunity, which are
approaching their fifth year near
the red planet's more hospitable
equatorial region, Phoenix's days
were numbered from the outset.'
With sunlight waning and win-
ter encroaching the arctic plains,
scientists had said it was a mat-
ter of time before Phoenix would
freeze to death.
Doug McCuistion, who heads

the Mars exploration program at
NASA headquarters, said people
should view Phoenix's end as "an
'Irish wake rather than a funer-
al."
"It's certainly been a grand
adventure," McCuistion said.
Since its 'successful landing
in May, Phoenix has sent back a
bonanza of scientific discover-
ies.
Its first breakthrough was
the confirmation of ice at its
landing site.
Previous measurements from
space suggested there was fro-
zen water lurking inches below
the surface, but Phoenix became
the first robotic probe to touch
and taste it by melting icy soil in
one of its lab ingtruments.

Aid likely depends on
whether American
gov't steps in
TORONTO (AP) - Canada's
prime minister said yesterday he's
open to providing aid to North
America's struggling auto sector
and will watch closely what the
U.S. government does.
Prime Minister Stephen Harp-
er said he's prepared to look at
options that would help the auto
sector. General Motors Corp.,
Chrysler LLC and Ford Motor
Co. all have large operations in
Canada.
Harper said a failed auto sec-
tor would cause a tremendous
dislocation in the Canadian econ-
omy, but he doesn't want one that
would be permanently supported
by government and not viable
without government help.
"We are all aware of the deep
problems of some of the major
companies in the auto sector.
We are also awa e of some of the

actions that are taking shape in
the United States," Harper said.
"The government of Canada will
examine all possibilities. We
haven't ruled anything out or
anything in."
Harper made the comments
after meeting with provincial
leaders about the economy.
Ontario Premier Dalton
McGuinty said he's looking for
cooperation from Harper on a
rescue package. McGuinty said
he can't compete with U.S. bail-
outs.
Canada's auto and auto parts
sectoremploys morethan120,000
people.
The U.S.-based automakers
have yet to hear whether they'll
get aid from the U.S government.
The automakers met with con-
gressional leaders last week in
hopes of securing financial help.
"I know the Americans are
looking at certain approaches.
We're going to be watching those
thingsverycarefullyandobvious-
ly developing our own responses
here in;Canada," Harper said.

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