NPR 2008-08-15

Secretary of State Condoleezza Rice is in France where she is calling on Russia to honor a French-mediated cease-fire with the former Soviet 1 Republic of Georgia. She is then going to Georgia to show her support for the embattled leader there. NPR's Michele Kelemen has more.

A State Department spokesman said there have been confusing reports from the ground in Georgia and he echoed Rice's call on Russia to halt all military operations and let US aid flow in. Defense 2 Secretary Robert Gates said much of the world is now looking at Russia "through different lenses". "If Russia does not step back from its aggressive posture 3 and actions in Georgia, the U.S.-Russian relationship could be adversely 4 affected 5 for years to come." Gates said he sees no need to use US military force, however, saying his mission is a humanitarian 6 one to bring in relief supplies and help Georgia recover. He said so far U.S. military experts have found the main port of Poti intact and key supply roads open. Michele Kelemen, NPR News, Washington.

The Federal Aviation Administration is accusing Fort Worth-based American Airlines of safety and drug-testing violations 8. The FAA says American returned two aircraft into service after pilots reported safety problems. The government says two of the Airlines' MD-83 jets were flown 58 times in violation 7 of federal safety regulations. The government also cited the nation's largest airline for deficiencies in its drug and alcohol testing programs. The FAA says it is seeking more than seven million dollars in penalties against American.

Major concession 9 toward former Democratic presidential hopeful Hillary Clinton. It's now been confirmed Clinton's name will be placed in nomination 10 along with that of nominee-in-waiting Barack Obama at the Democratic National Convention in Denver. The move while largely symbolic 11 is expected to help unite the party that was fractured by the divisive primary.

Morgan Stanley and JPMorgan Chase have become the latest big banks to say they'll buy back auction-rate securities from their customers. Regulators say the banks misled customers about the risky 12 securities. NPR's Jim Zarroli reports.

New York Attorney General Andrew Cuomo said the banks sold auction-rate securities to individual investors 13, charities and small businesses even though the market for these products had dried up. "These are people who believe they were buying a short-term security. It was a cash equivalent, just like cash. And for six months they've been locked in this nightmare where they can't get their money back." Auction-rate securities are debt products with interest rates that reset 14 regularly. Cuomo's offer said JPMorgan Chase and Morgan Stanley had agreed to buy back about seven billion dollars worth of securities between them. They agreed to the settlement without admitting any wrongdoing. Citigroup and UBS have already agreed to similar settlements. Jim Zarroli, NPR News, New York.

On Wall Street, the Dow Jones Industrial Average climbed 82 points today to end the session at 11,615. The NASDAQ gained 25 points. The Standard & Poor's 500 was up seven points today.

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Police in Iraq say at least 18 people are dead and dozens of others were wounded after a female suicide bomber 15 detonated an explosive device near a group of Shiite pilgrims. The blast south of Baghdad today was the deadliest in what authorities say has been a series of attacks aimed at travelers heading to the holy city of Karbala for a major religious festival. A witness says the woman blew herself up near a group that was resting by the side of the road.

In a rare order, a federal appeals court in New York will reconsider the case of Canadian rendition victim Maher Arar. Arar is an engineer who says he was tortured after being mistaken for a terrorist. His lawsuit 16 was dismissed two months ago. NPR's Margot Adler reports.

Arar who was born in Syria was detained in 2002 while returning to Canada after a vacation. Federal authorities say he was wrongly identified as a member of Al-Qaeda. The Canadian government agreed to pay him 10 million dollars for passing bad information to US authorities. The US sent Arar to Syria and he has claimed in interviews and in the lawsuit that he was tortured there. The lawsuit was filed by the Center for Constitutional Rights in 2004. A three-judge panel dismissed the lawsuit in June, saying allowing it to proceed would harm national security and interfere 17 with US foreign relations. But now lawyers have been notified that the full Second Circuit Court of Appeals, about a dozen judges, will rehear the case. Margot Adler, NPR News, New York.

Another sign the downturn in the US housing market may have further to go. The National Association of Realtors says house prices fell in more than three quarters of US cities during the second three months of this year. Nationally the medium price of a single family home was $206, 500, a more than 7.5% decline from the same period a year ago.