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November 18, 2010 - Image 3

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The Michigan Daily - michigandaily.com

Thursday, November 18, 2010 - 3A

The Michigan Daily - michigandailycom Thursday, November 18, 2010 - 3A

* Unemployment in
Michigan drops
below 13 percent
Michigan's unemployment rate
dropped to 12.8 percent in October,
the first time since March 2009
the rate has been below 13 percent,
state officials said yesterday.
Michigan's current jobless rate
is significantly below the October
2009 rate of14.4 percent. Inthe past
year, the state has seen unemploy-
ment fall by 11.6 percent, compared
with a national decline of 4.9 per-
cent, according to Rick Waclawek
of the state's Bureau of Labor Mar-
ket Information. The national rate
currently is 9.6 percent.
Democratic Gov. Jennifer Gran-
holm, who leaves office at the end of
December, said the fact that Michi-
gan's jobless rate is falling faster
than the nation's is good news.
Michigan Economic Develop-
ment Corp. CEO Greg Main told
reporters yesterday that businesses
are continuing to ask for tax breaks
for new projects.
FRESNO, Calif.
Illegal immigrant
elected student
body president
The popular student body pres-
ident at California State Universi-
ty, Fresno has publicly revealed a
personal detail he long sought to
keep secret: He is an illegal immi-
Pedro Ramirez, 22, previously
told campus administrators in
confidence that he was concerned
about going public with his immi-
gration status after winning the top
post in student government.
But that changed Tuesday when
The Collegian, the newspaper at
the largest university in Califor-
nia's prolific farming region, dis-
closed his status after receiving an
anonymous e-mail.
"I don't want this issue to be
about me," Ramirez told The Asso-
ciated Press yesterday. "This is a
big, big issue that should have been
addressed a long time ago. My goal
is to bring awareness to that."
Ramirez was expected to appear
Friday at a campus rally in support
of the federal "DREAM Act," which
would create a path to citizenship
for young people living in the coun-
try illegally who attend college or
join the military.
HANOI, Vietnam
Death toll from
latest Vietnam
* floods rises to 19
Vietnam's government says eight
additional bodies have been recov-
ered after the latest round of flood-
ing in the country's central region,
raising the death toll from this
week's flooding to 19.
The government's disaster agen-
cy said on its website today that
the floods also have left six people
It said rains up to 32 inches (80
centimeters) have pounded the

region over the past four days, forc-
ing the evacuation of nearly 40,000
The agency said the floods have
begun receding after submerging
nearly 30,000 homes and dam-
aged 35,000 acres (14,000 hect-
ares) of rice paddies and other
The area, one of the country's
poorest, was buffeted by three
earlier rounds of flooding since
early October that killed 167 peo-
Harvard comedy
show made fun of
Yale student killing
A comedy news show run by
Harvard University students is
making light of last year's killing of
a Yale University graduate student
in a parody video.
The "On Harvard Time" show
released the "Why Did I Choose
Yale?" video on Tuesday ahead of
this weekend's annual Yale-Har-
vard football game.
The spoof of a Yale admissions
office video refers to the slaying of
Placerville, Calif., resident Annie
Le (lay) when a prospective student
asks a tour guide, "What happened
to that girl that got murdered and
stuffed in a wall?"
The 24-year-old Le's body was
found behind a research lab wall in
2009. A former lab technician has
pleaded not guilty to killing her.
- Compiled from
Daily wire reports.

Alcoholic energy
drlnks dangerous,
FDA cautions

GM set to return to
stock market today

Government could
seize products that
pose health risks
Food and Drug Administration
issued warning letters yesterday
to four manufacturers of alcoholic
energy drinks often consumed by
college students, saying the caf-
feine added to their beverages is
an "unsafe food additive."
FDA Commissioner Marga-
ret Hamburg said the combina-
tions of caffeine and alcohol in
the drinks is a public health con-
cern and can lead to "a state of
wide-awake drunk." Evidence
has shown their consumption has
led to alcohol poisoning, car acci-
dents and assaults, she said.
The government could even-
tually seize the products if the
companies continue to make and
market them. The companies
have 15 days to respond to the let-
ters and either explain how they
will take their products off the
market or defend their drinks as
The government came under
increasing pressure as college
students have been hospitalized
in recent months after consuming
the drinks. The FDA said experts
have raised concerns that the caf-
feine in the drinks can mask ,a
person's feeling of intoxication,
leading to risky behavior. Many
of those who consume the drinks
are underage drinkers.
In response to such incidents,

four states - Washington, Michi-
gan, Utah and Oklahoma - have
banned the beverages. Other
states are considering similar
White House Drug Policy
Director Gil Kerlikowske said
Wednesday that the FDA's quick
action to decrease consumption
of the drinks is critical.
"These products are designed,
branded, and promoted to encour-
age binge drinking," he said.
With the FDA decision immi-
nent, Phusion Projects, which
manufactures the popular Four
Loko, announced late Tuesday
that it would reformulate its
drinks and remove the caffeine.
The company's statement said
it was reformulating the drinks
after unsuccessfully tryingto deal
with "a difficult and politically-
charged regulatory environment
at both the state and federal lev-
"We have repeatedly con-
tended - and still believe, as
do many people throughout the
country - that the combination
of alcohol and caffeine is safe,"
said Chris Hunter, Jeff Wright
and Jaisen Freeman, who identify
themselves as Phusion's three co-
founders and current managing
Four Loko comes in several
varieties, including fruit punch
and blue raspberry. A single-serv-
ing 23.5-ounce can sells for about
$2.50 and has an alcohol content
of 12 percent, comparable to four
beers, according to the company's

GM prices its share
value at $33 after
increasing total
number of stocks
DETROIT (AP) -- The last time
General Motors threw a big party
was two years ago, for its 100th
birthday. Two months later, its
CEO was before Congress, beg-
ging for bailout money. Now GM is
getting ready for another celebra-
tion - this time for its future.
GM will be reborn as a public
company Thursday with a stock
offering, ending the government's
role as majority shareholder and
closing a remarkable chapter in
American corporate history.
The U.S. government should
make about $13.6 billion when GM
shares start trading on the New
York Stock Exchange. The federal
Treasury is unloading more than
400 million shares of GM, reduc-
ing its stake in the company from
61 percent to about 33 percent.
The IPO could wind up as the
largest in history. GM set a price
of $33 per common share yester-
day, a day after it raised the num-
ber of shares it will offer to satisfy
investor demand. When the U.S.
government and other owners sell
their shares, they'll raise $18.2
billion. GM will raise another $5
billion by selling 100 million pre-
ferred shares at $50 each.
Together, the sale of common
and preferred stock will bring the
deal's value to a record $23.2 bil-
The stock offering is the latest
in a series of head-spinning devel-
opments over the past two years

for an American corporate icon.
In 'September 2008, to mark
the beginning of its second cen-
tury, the automaker celebrated
in the grand three-story atrium
on the ground floor of its Detroit
headquarters. GM had seen a lot
of changes in its 100 years, said
then-CEO Rick Wagoner.
"In fact, it's changed a lot in
the last 100 hours," he said, refer-
ring to the banking crisis, which
was just starting to unfold. Two
months later, Wagoner found
himself in front of members of
Congress, begging for money to
keep GM alive. Four months after
that, he was ousted by President
Barack Obama.
By June 2009, GM had filed for
bankruptcy. Itemerged relieved of
most of its debt but mostly owned
by the government and saddled
with a damaging nickname: "Gov-
ernment Motors." The value of
its old stock was wiped out, along
with $27 billion in bond value.
Now GM will become a pub-
licly traded company again and
revive the stock symbol "GM."
Dan Akerson, GM's fourth CEO
in two years, will ring the opening
bell tomorrow on the New York
Stock Exchange, to celebrate the
company's rebirth.
"This is an extraordinarily
important moment in the life of
GM, along with emerging from
bankruptcy," says Steve Rattner,
who headed up Obama's auto task
force for several months. "It's not
the end of the story of government
involvement in GM, but it is a crit-
ically important step forward."
Most of the new stock will go
to institutional investors, not to
everyday investors, following a
Wall Street system that rewards

investment banks' big customers.
GM will set aside 5 percent of its
new stock for employees, retirees
and car dealers to buy at the offer-
ing price. The deadline to sign up
was Oct. 22, but the company has
not revealed how many people
took the offer.
Senior Obama administration
officials said yesterday that the#
Treasury Department sought to
strike a balance between getting
a return for taxpayers and exiting
government ownership as soon as
The government has agreed
that it will not sell shares out-
side the IPO for six months after
the sale. The officials, who spoke
on condition of anonymity, said
they would assess their options
for selling the government's stake
In the stock offering, the gov-
ernment stands to make $13.6 bil-
lion if it sells 412 million shares, as
planned, for $33 apiece. It will still
have about 500 million shares, a
one-third stake. It would have to
sell those shares over the next two
to three years at about $53 a share
for taxpayers to come out even.
The total bailout was $50 bil-
lion. GM has already paid or
agreed to pay back $9.5 billion.
That comes from cash and pay-
ments related to preferred stock
held by the government.
The GM debut comes at a time
when auto stocks are performing
well generally. The stock of GM's
crosstown rival, Ford, has risen
steadily this.year, from about $10
in January to about $16.50 as the
GM IPO approached. The stock
traded for a dollar in November
2008, and Ford never even took
bailout money.

Obama advocates for Senate'
approval of nuclear arms pact

Two police officers stand guard yesterday at the main train station in Berlin, Germany.
German officials boost
securitylevel afternew
terrorism warnings

Treaty to shrink
U.S. and Russian
arsenals of strategic
dent Barack Obama will push for
Senate ratification of a nuclear
arms pact with Russia before
year's-end despite opposition
from a key Republican senator,
the White House said yesterday.
Press Secretary Robert Gibbs
said he believes the New START
deal will come up and pass dur-
ing the lame-duck Congress, now
in progress.
The pact is a top foreign poli-
cy priority for Obama. It would
shrink the U.S. and Russian arse-
nals of strategic warheads, and
revive on-the-ground inspec-
tions that ceased when a previous
treaty expired nearly a year ago.
Sen. Jon Kyl, a leading Repub-
lican voice on the issue, dealt
the pact a major setback Tues-
day by coming out against a vote
this year. Kyl, who's been seek-
ing more money and focus on
maintaining and modernizing
the remaining arsenal, said more
time was needed before moving
When pressed on the issue yes-
terday, Kyl told reporters: "We're
talking in good faith."
The treaty has support from
some moderate Republicans, but
Kyl's opposition makes approval
a tough climb since many in the
GOP were looking to his assent
before giving their backing. Six-
ty-seven votes are needed for
approval, so Democrats need at
least eight Republican votes for
ratification in the current Senate.

Once the newly elected Senate
is sworn in January, Democrats
need the support of at least 14
"The president will continue
to push this and believes the Sen-
ate should act on it before they go
home," Gibbs told reporters at the
White House.
"I think we'll have enough
votes to pass it" even without
Kyl's support, Gibbs said, calling
it crucial to the nuclear inspec-
tion regime and international
"I don't think it's going to get
pushed into next year," he said.
Senate Majority Leader Harry
Reid, D-Nev., issued a state-
ment yesterday supporting quick
action on the treaty, saying he
was "puzzled" by Kyl's stance.
But the administration's hopes
suffered another hit when Repub-
lican Sen. George Voinovich, an
Ohio moderate who is retiring
this year, expressed his reserva-
tions with the treaty.
"America's grand strategy
approach towards Russia must be
realistic, it must be agile, and as .1
have said it must take into account
the interests of our NATO allies.
I am deeply concerned the New
START Treaty may once again
undermine the confidence of our
friends and allies in Central and
Eastern Europe," Voinovich said
in a statement.
A clearly frustrated Sen. Rich-
ard Lugar of Indiana, the top
Republican on the Foreign Rela-
tions Committee and a treaty
supporter, suggested the admin-
istration press ahead with a vote
despite the opposition of Kyl and
others. Lugar, a leading voice on
nuclear issues, said if the White
House and Democrats wait until
next year and the new Congress,

the process would have to start
anew with hearings, committee
votes and a greater risk that the
treaty isn't ratified.
"This is a situation of some
national security peril," Lugar
told reporters.
Obama and Russian President
Dmitry Medvedev signed the
pact in Prague in April. Obama
met with Medvedev last weekend
on the sidelines of an economic
meeting in Japan and emphasized
his commitment to advancing the
treaty during the lame-duck ses-
The treaty would reduce U.S.
and Russian strategic warheads
to 1,550 for each country from
the current ceiling of 2,200. It
also would set up new procedures
to allow both countries to inspect
each other's arsenals to verify
Sen. John Kerry, top Democrat
on the Senate Foreign Relations
Committee, said there were no
substantive disagreements on
the treaty itself and that a major
objection of Kyl's should have
been removed when the adminis-
tration pledged an additional $4.1
billion for weapons moderniza-
tion programs.
Earlier yesterday, Secretary
of State Hillary Rodham Clinton
beseeched the Senate to vote this
"This is not an issue that can
afford to be postponed," the sec-
retary said after the meeting.
Adm. Mike Mullen, chairman
of the Joint Chiefs of Staff, said
yesterday that the treaty must
"I'm very comfortable with
our military capability that's rep-
resented in this treaty. I'm very
comfortable with the verification
piece," Mullen told reporters.

German chancellor:
Security threat will
not stop my travels
BERLIN (AP) - Germany sent
hundreds of police officers into
railway stations, airports and other
public places yesterday, after the
nation's topsecurityofficialwarned
of an increased threat from Islamic
The move came after new, tan-
gible intelligence came to light over
the past weeks and months, Inte-
rior Minister Thomas de Maiziere
said. Germans will notice a visible
response to the threat, including
an increased police presence at air-
ports and railway stations to remain
in place untilfurther notice, he said.
"These measures are aimed at
prevention and deterrence," de
Maiziere said. "We are showing
force, that we will notbe bullied."
Despite the heightened security
presence, de Maiziere urged calm.
Officials did not provide specific
details about the threat.
"There is reason for worry, but
there is no reason for hysteria," he
said. "We will not allow interna-
tional terror to limit us in our way
of life and our culture of freedom."
Germany has no color-coded or
numbered-tier system for measur-
ing security levels, comparable to
those in the U.S., Britain or France
and tends to be far more cautious in
publicly discussing the degrees of
threat, on grounds it could endan-
ger efforts to prevent an attack.
Germany has more than 4,900
soldiers serving in northern
Afghanistan as part of the NATO
security force there and has long
expressed concern it could be tar-
geted by extremists.

Chancellor Angela Merkel's
spokesman, Steffen Seibert, said
there were no plans to cancel or
change any trips or public appear-
ances by the German leader. He
echoed de Maiziere's statement that
the country must not allow terror
threats to impinge on its freedom -
"then we would give the terrorists a
cheap victory."
Though Germany has escaped
any major terrorist attacks like the
Madrid train bombings of 2004 and
the London transit attacks of 2005,
at least two major plots have been
thwarted or failed before they could
be carried out.
"Besides the previously known
findings, we now have additional,
relevantindications of possible dan-
ger that security authorities agree
justify our current assessment that
we are now facing a new situation,"
de Maiziere said.
He cited a tip from another
unspecified country about a sus-
pected attack planned for the end
of November - though he didn't say
where it was supposed to take place.
That tip arrived after the inter-
ception of two mail bombs mailed
from Yemen to the U.S. - one of
which went through a German
airport before it was found in Brit-
ain. The Yemen plot points to "the
adaptability and the persistence of
terrorists in pursuing their aims,"
and underlines "the reliability of
some leads," de Maiziere said in
a statement to reporters, without
He said German authorities had
also gathered concrete intelligence
of their own pointing to "sustained
efforts" by Islamic extremist
groups to plan attacks in Germany.
Consequently, authorities have
launched investigations that could
lead to charges.

A 4

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