NPR 2011-08-03

 US stocks are sharply lower before the close, all indexes dropping more than 2% in the wake of more disappointing economic news. The government finds that people scaled back their spending 0.2% in June while their incomes grew by the smallest amount in nine months. The Commerce Department says incomes were up just 0.1%. At last check, the Dow was down more than 2% or 262 points lower at 11,870; the NASDAQ was off 2.75% at 2,669; S&P 500 down 2.5% at 12,054.

 
All these are also in the wake of a just ended battle over hiking the debt ceiling. That latest chapter of the debt ceiling debate over with President Obama signing into law a measure today that heads off the government default by raising the debt limit. Mr. Obama says hopefully there won't be a repeat of waiting to the 11:00 to compromise, especially since the political fight over deficit 1 reductions is far from over.
 
"We've seen in the past few days that Washington has the ability to focus when there's a timer ticking down, and when there's a looming 2 disaster. It shouldn't take the risk of default — the risk of economic catastrophe 3 — to get folks in this town to work together and do their jobs."
 
NPR's David Welna tracked the measure's tumultuous passage through Congress which culminated 4 in a vote of 74-29 in the Senate today.
 
There's little love for the bill that congressional leaders in the White House cobbled together over the weekend. Republicans feel it does too little to change Washington's spending habits, while Democrats 5 deplore 6 its reliance on spending cuts alone to reduce the deficit while leaving tax policy unchanged. But Senate Minority Leader Mitch McConnell, who was a key architect of the deal, says it shows Congress can still act when it needs to.
 
"It's a testament 7 to the goodwill 8 of those on both sides that we were able to reach this agreement in time. Neither side wanted to see the government default, and I'm pleased we were able to work together to avoid it."
 
The bill authorizes 9 President Obama to request another 1.7 trillion dollars in borrowing authority, enough to keep the government solvent 10 through the end of next year. David Welna, NPR News, the Capitol.
 
Now as the Senate prepares to recess 11 within hours, lawmakers are grappling with yet another crisis. This one involves the Federal Aviation Administration. The agency is partially 12 shut down. Thousands of its employees are out of work. And if there's no resolution by the time the Senate leaves, these workers could remain unemployed 13 until September when Congress reconvenes. The shutdown was triggered by a dispute over subsidy 14 cuts in rural air service amounting to 16.5 million dollars. If the shutdown drags on, it could cost the government 1.2 billion in lost revenue.
 
Before the close on Wall Street, the Dow was down 266 points, more than 2%, at 11,867.
 
This is NPR.
 
Oklahoma and Texas appear to be under a bull's eye for extreme dry conditions which climatologists don't predict to end until at least the fall. From member station KOSU, Michael Cross tells us agriculture producers are going into the hottest days of the year, dealing 15 with a drought which started in Oklahoma last October.
 
The Oklahoma Department of Agriculture says cotton is expected to be 35% to 40% of the normal crop, and Associate Commissioner 16 Blayne Arthur says cotton's not the only produce getting hit. 
 
"The majority of the corn that we have in Oklahoma has burned up by this time of the year, and we had probably more corn planted this year than we had in previous years."
 
Arthur says ranchers aren't fairing any better as there's less forage 17 for cattle, and lake and river beds have started drying up. She says many of the producers are either selling their herds 18 or trying to lease them to other states not under drought conditions. For NPR News, I'm Michael Cross in Oklahoma City.
 
The operator of Japan's damaged nuclear power plants says it has sealed an area with high levels of radiation. Tokyo Electric Power says radiation levels around the complex are not rising, a sign there's no duct leak at the affected 19 reactor 20. The plant was breached 21 in the March's earthquake and tsunami 22.
 
Karachi, Pakistan is said to be under escalated 23 security after two days of clashes left 34 people dead. The Associated Press reports paramilitary forces have been patrolling the streets to contain the violence, much of which stems from political rivalry 24.
 
At last check on Wall Street, Dow was down 266 points, more than 2%, at 11,867.
 
I'm Lakshmi Singh, NPR News.