NPR 2009-03-25

Treasury 1 Secretary Timothy Geithner says the administration will be asking for new financial tools to prevent future problems with companies like insurance giant AIG. Geithner told the House Committee the administration may be asking for more money as well. NPR’s Scott Horsley has details.

Secretary Geithner says the government needs the authority to monitor big financial companies like AIG and dismantle 2 them when they are in danger of failing, much the way the FDIC takes control of failing banks. Lawmakers quizzed Geithner about how much more money might be needed to prop 3 up the financial system. While the president’s budget includes a contingency 4 for another 750 billion dollars, Geithner says no decision has been made yet. “I completely understand the scale of skepticism in public opposition 5 to the provision of additional resources, but our responsibility is to recommend the Congress what’s necessary to help get the economy back on track. And if that requires more resources, it will be our obligation to come to you and make the case for that.” Geithner admits making that case will be more difficult not only because of bonuses paid to executives at AIG but because of frustration 6 with bailouts in general. Scott Horsley, NPR News, Washington.

President Barack Obama is preparing to hold a prime-time news conference in about two hours from now where he’s expected to say the US economy will “recover from this recession”.  The president is also expected to use his appearance to defend the administration’s 3.6-trillion-dollar spending package which he says will put the economic recovery on a stronger foundation that ensures the nation does not face another crisis in ten or twenty years time. Mr. Obama also cites the fact that investing in renewable sources of energy will create new jobs and new businesses while reducing dependence 7 on foreign oil.

US authority has asked a Guantanamo bay detainee to drop allegations of torture and agree not to speak publicly about his ordeal 8 in exchange for his freedom. That’s according to British court documents. NPR’s Dina Temple-Raston reports.

Last fall US government attorneys tried to convince Ethiopian refugee Binyam Mohamed to accept certain conditions for a release. The US originally accused Mohamed of having a role in a dirty bomb plot against the US, and then dropped the charges in October. Just before that happened, US attorneys said Mohamed could be released in a year if he admitted guilt 9, said he’d never been tortured and would not sue the US government. Mohamed was arrested in Pakistan in 2002; from there he went to Morocco where he says he was tortured while in custody 10.  He was then transferred to Afghanistan and then finally ended up the Guantanamo bay. Britain has acknowledged that Mohamed was sent to Morocco but has refused to provide any details. The United States has also refused to account for the time he says he was there. Dina Temple-Raston, NPR News.

On Wall Street, the Dow Jones Industrial Average fell 115 points ending the session at 7,660. The NASDAQ was down 37 points today. The Standard & Poor’s 500 dropped 16 points to close at 806.

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New York Governor David Paterson is threatening to lay off as many as 8,900 state workers. That’s after a union’s refused concessions 11 aimed at closing a looming 12 16-billion-dollar deficit 13. State’s Budget Director was quoted as saying the proposed layoff 14 should be the first for the state since the late 1990s. State officials said the layoff could begin July 1st, however state's union could also still return to the bargaining table before a budget package is negotiated. New York state employees are just under 200,000 people.

It’s being predicted that the toll 15 the economic crisis would take on the global airline industry this year will be worse than after the 9/11’s terrorist attacks in 2001. Larry Miller 16 has more from London.

The International Air Transport Association describes the present state of the airline industry as pretty grim. It forecasts globally, airline revenue will be down 12% and airlines will lose 4.7 billion dollars. Not as bad as last year, when the industry lost up to 8.5 billion dollars. To counter the effects of the poor economy and reduced demand, many carriers have cut capacity. There is also the benefit of lower fuel prices. The head of the association said the pressure on the industry balance sheet is extreme. However, US airlines are apparently 17 bucking 18 the downward trend and are expected to make 100-million-dollar profit this year. For NPR News, I’m Larry Miller in London.

Houston Chronicle is the latest big city daily to announce cutbacks. The newspaper says it will begin laying off around 12% of the existing workforce 19 in what’s been built as a cost-cutting move. The paper blames the latest job cuts on changes in the industry. It’s not clear how many Chronicle employees will actually lose their jobs.