Obama Hails 'Cliff' Deal, Warns of Next Fiscal Fight

Minutes after the House of Representatives approved a bipartisan Senate deal to avert the "fiscal cliff" and preserve Bush-era tax cuts for all Americans making less than $400,000 per year, President Obama praised party leaders and wasted little time turning to the next fiscal fight.

"This is one step in the broader effort to strengthen our economy for everybody," Obama said.

Obama lamented that earlier attempts at a much larger fiscal deal that would have cut spending and dealt with entitlement reforms failed. He said he hoped future debates would be done with "a little less drama, a little less brinksmanship, and not scare folks quite as much."

But Obama drew a line in the sand on the debt ceiling, which is set to be reached by March.

"While I will negotiate over many things, I will not have another debate with this Congress over whether they should pay the bills for what they've racked up," Obama said. "We can't not pay bills that we've already incurred."

An hour after his remarks, Obama boarded Air Force One to return to his planned Hawaiian holiday vacation, reuniting with his family, who have been vacationing there since just before Christmas.

AP Photo/Charles Dharapak

'Fiscal Cliff' Negotiations: Congress Reaches Agreement Watch Video

House Republicans agreed to the up-or-down vote Tuesday evening, despite earlier talk of trying to amend the Senate bill with more spending cuts before taking a vote. The bill delays for two months tough decisions about automatic spending cuts that were set to kick in Wednesday.

A majority of the Republicans in the GOP-majority House voted against the fiscal cliff deal. About twice as many Democrats voted in favor of the deal compared to Republicans. One hundred fifty-one Republicans joined 16 Democrats to vote against the deal, while 172 Democrats carried the vote along with 85 Republicans.

The Senate passed the same bill by an 89-8 vote in the wee hours of New Year's Day. If House Republicans had tweaked the legislation, there would have been no clear path for its return to the Senate before a new Congress is sworn in Thursday.

The vote split Republican leaders in the House. House Speaker John Boehner, R-Ohio, voted yes, and so did the GOP's 2012 vice presidential candidate, Rep. Paul Ryan, R-Wis.

But House Majority Leader Eric Cantor, R-Va., the No. 2 Republican in the House, voted no. It was his opposition that had made passage of the bill seem unlikely earlier in the day.

The deal does little to address the nation's long-term debt woes and does not entirely solve the problem of the "fiscal cliff."

Indeed, the last-minute compromise -- far short from a so-called grand bargain on deficit reduction -- sets up a new showdown on the same spending cuts in two months amplified by a brewing fight on how to raise the debt ceiling beyond $16.4 trillion. That new fiscal battle has the potential to eclipse the "fiscal cliff" in short order.

"Now the focus turns to spending," said Boehner in a statement after the vote. "The American people re-elected a Republican majority in the House, and we will use it in 2013 to hold the president accountable for the 'balanced' approach he promised, meaning significant spending cuts and reforms to the entitlement programs that are driving our country deeper and deeper into debt."

Republicans hope that allowing the fiscal cliff compromise, which raised taxes without an equal amount of spending cuts, will settle the issue of tax rates for the coming debates on spending.

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Senate approves deal to avoid worst of ‘fiscal cliff’

The Senate approved a bipartisan agreement early Tuesday morning to let income taxes rise sharply for the first time in two decades, fulfilling President Obama’s promise to raise taxes on the rich and avoiding the worst effects of the “fiscal cliff.” The agreement, brokered by Vice President Biden and Senate Minority Leader Mitch McConnell (R-Ky.), passed 89 to 8 in a highly unusual New Year’s morning vote. It now heads to the House, where leaders have not guaranteed passage but top officials believe it could win passage in the next few days.

The agreement primarily targets taxpayers who earn more than $450,000 per year, raising their rates for wages and investment profits. At the same time, the deal would protect more than 100 million households earning less than $250,000 a year from income tax increases scheduled to take effect Jan. 1.

The deal came together barely three hours before the midnight deadline, after negotiators cleared two final hurdles involving the estate tax and automatic spending cuts set to affect the Pentagon and other federal agencies this week.

Republicans gave in on the spending cuts, known as sequestration, by agreeing to a two-month delay in budget reductions that would be paid for in part with new tax revenue, a condition they had resisted. And the White House made a major concession on the estate tax, agreeing to terms that would permit estates worth as much as $15 million to escape taxation by the end of the decade, Democrats said.

As Biden rushed to the Capitol to brief Senate Democrats on the deal, Majority Leader Harry M. Reid (D-Nev.) laid plans for a vote shortly after midnight, when taxes were set to rise for virtually every American.

“I think we’ll get a very good vote tonight,” a beaming Biden said as he emerged from the meeting with Democrats after nearly two hours. “But happy new year and I’ll see you all maybe tomorrow.”

About three hours later, just before 2 a.m., the gavel finally fell on a sweeping bipartisan vote designed to send a signal to the more unstable House that passage was imperative. Just three Democrats and five Republicans opposed the measure. The moment served as a rare bipartisan coda to what has been one of the most rancorous, partisan Congresses in recent history, as the 11 retiring senators received hugs and kisses from senators, bidding what is likely a final farewell as colleagues.

Now the measure heads to the House, where Speaker John A. Boehner (R-Ohio) pledged to bring it to a vote in the coming days.

Senior aides predicted the measure would pass the House with bipartisan support. But Boehner’s decision to delay the vote meant the nation would tumble over the cliff at least briefly.

In addition to dealing with the fiscal crisis, the measure would extend federal farm policies through September, averting an estimated doubling of milk prices. The deal also nixed a set pay raise for members of Congress.

During a midday event at the White House, Obama praised the emerging agreement even though it would raise only about $600 billion over the next decade by White House estimates — far less than the $1.6 trillion the president had initially sought to extract from the nation’s richest households.

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Boy arrested over threat to blow up MBS

SINGAPORE: Police have arrested a 13-year-old boy who threatened to plant bombs in Marina Bay Sands.

The boy had posted the threat on his Facebook page last Saturday.

Police said the case is classified as a Breach of Prohibition Against False Threats of Terrorist Acts.

If convicted, he could be fined up to S$100,000 and jailed up to 5 years.

Police investigations are ongoing.

- CNA/ir

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Narayanasamy blames Tamil Nadu for fishermen's plight

PUDUCHERRY: Union minister of state V Narayanasamy today blamed the Tamil Nadu government for its "inaction" to facilitate a dialogue between Indian fishermen and their counterparts in Sri Lanka.

Though the external affairs ministry secretary had written twice to the Tamil Nadu government recently for a dialogue to ensure protection of fishermen, the state government had not shown any response to the Centre's initiative, minister of state in the PMO Narayanasamy said.

Only through an agreement between the leaders of Tamil Nadu fishermen outfits and their counterparts in the Island Republic could the present hardships being faced by fishermen of Puducherry and Tamil Nadu be brought to an end, he told reporters here.

Emphasising the need to demarcate the zones within which the fishermen of the state and Sri Lanka could carry on their avocation, the secretary to the external affairs ministry had written twice to the Tamil Nadu chief secretary for the dialogue. "No response has, however, been shown by the Tamil Nadu government so far to these communications," he said.

Replying to a question on the UPA's prime ministerial candidate, Narayanasamy said as far as Congress was concerned party leader Sonia Gandhi was the ultimate authority to decide on the matter, though there were several persons eligible to become the Prime Minister.

"Let us not indulge in any discussion now," he said.

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Space Pictures This Week: Ice “Broccoli,” Solar Storm

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  Happy Trails

  Photograph by Alex Cherney, TWAN

  Amateur astronomer Alex Cherney captured these star trails as they blazed above Lake Tyrrell, a salt lake in Victoria, Australia in October 2011 and posted to The World At Night website December 25, 2012.

  (See pictures of another Australian salt lake, Lake Eyre.)

  Published December 31, 2012

  
  











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  Tokyo From Space

  
  Image courtesy DLR

  The sprawling Japanese capital Tokyo looks like a funky computer chip in this image taken by Germany's Earth-observing satellite TerraSAR-X and released December 20.

  Launched in 2007, the satellite's radar sensors map Earth from 319 miles (514 kilometers) up in a near-polar orbit.

  Published December 31, 2012

  
  











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  Extreme View

  
  Image courtesy SDO/NASA

  NASA's Solar Dynamics Observatory snapped this extreme ultraviolet view of an active region on the sun as it rotated into view from December 16 to December 18. Ultraviolet light makes it easier to trace the whorls and loops created by superheated gas, or plasma, and the sun's magnetic field lines.

  Active solar regions such as this create space weather that, when aimed at Earth, can disrupt satellite communications and electronics. (See more pictures of solar activity and space weather.)

  Published December 31, 2012

  
  











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  Saturn’s Dark Side

  
  Image courtesy SSI/Caltech/NASA

  This image of the unlit side of Saturn's S rings, released December 24, was taken with visible light by NASA's Cassini spacecraft.

  The shadow of Saturn's innermost major moon, Mimas, is visible as a black oval south of the rings' shadow. For those with completely dust-free computer monitors, Janus, another Saturnian moon, is visible as a tiny white speck above the planet's north pole. (Learn about Saturn's major moons.)

  Published December 31, 2012

  
  











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  A River Runs Through It

  
  Image courtesy ESA/JAXA

  The European Space Agency released this picture—taken by Japan's satellite ALOS—of Italy's longest river on December 14.

  The Po river and its surrounding fields divide Italy into its northern and southern regions. The Japanese used ALOS, which they lost contact with in late April 2011, to generate precise land maps, monitor disasters, and conduct resource surveys. (Read an excerpt from National Geographic magazine about the Po river.)

  Published December 31, 2012

  
  











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  Glacial "Broccoli"

  
  Image from DigitalGlobe/Getty Images

  The Moshniy glacier, located on the Russian archipelago Novaya Zemlya in the Arctic Ocean, calves chunks of ice and debris into a pattern reminiscent of broccoli in an image released December 20.

  Novaya Zemlya was a sensitive military area during the Cold War, and was also the site of the most powerful nuclear device ever detonated. The energy released by the 50-megaton "Tsar" bomb was ten times that of all the explosions set off during World War II.

  Published December 31, 2012

  
  











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  Image courtesy Caltech/SSI/NASA

  Published December 31, 2012

  
  

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Senate Approves 'Fiscal Cliff' Deal, Sends to House

Two hours after a midnight deadline for action, the Senate passed legislation early New Year's Day to avert the so-called "fiscal cliff" with an overwhelming vote of 89-8.

Senate passage set the stage for a final showdown in the House, where a vote could come as early as today.

"While neither Democrats nor Republicans got everything they wanted, this agreement is the right thing to do for our country and the House should pass it without delay," President Obama said in a statement shortly after the vote.

"There's more work to do to reduce our deficits, and I'm willing to do it. But tonight's agreement ensures that, going forward, we will continue to reduce the deficit through a combination of new spending cuts and new revenues from the wealthiest Americans," he added.

The bill extends Bush-era tax cuts permanently for people making less than $400,000 per year and households making less than $450,000.

The steep "sequester" budget cuts scheduled to go into effect with the New Year would be postponed for two months.

The deal also would affect taxes on investment income and estates, and extend unemployment benefits for a year.
Officials also decided at the last minute to use the measure to prevent a $900 pay raise for lawmakers due to take effect this spring.

'Fiscal Cliff': Lawmakers Scramble for Last-Minute Deal Watch Video

The failure of a deal to pass Congress by Jan. 1 technically triggers an income tax hike on all Americans and automatic spending cuts, though lawmakers could still prevent a tax hike by making retroactive any legislation that passes in the weeks ahead, experts said.

The deal at hand will not entirely solve the problem of the "fiscal cliff," however. In fact, it could set up a new showdown over the same spending cuts in just two months that would be amplified by a brewing fight over how to raise the debt ceiling beyond $16.4 trillion. That new fiscal battle has the potential to eclipse the "fiscal cliff" in short order.

In addition to extending current tax rates for households making $450,000 or less, the latest plan would raise the estate tax from 35 to 40 percent for estates larger than $5 million; and prevent the alternative minimum tax from hammering millions of middle-class workers.

Capital gains taxes would rise to 20 percent from 15 percent.

The deal would also extend for one year unemployment insurance benefits set to expire today for two million people, and avert a steep cut to Medicare payments for doctors.

"Working though the night and throughout the day we've reached an agreement with Sen. McConnell," Senate Majority Leader Harry Reid, D-Nev., said early Tuesday morning prior to the vote.

"I've said all along our most important priority is protecting middle class Americans, this legislation does that," Reid added.

He said he is "disappointed" they were not able to make the grand bargain and that more work needs to be done in the future.

"But we tried, if we did nothing the threat of a recession is very real," Reid concluded.

Speaking after Reid, Senate Minority Leader Mitch McConnell, R-KY., called the deal an "imperfect solution" and noted this should not be the model on how things get done in the Senate.

McConnell also thanked Vice President Joe Biden, who visited Capitol Hill late Monday night and brokered the deal with McConnell.

The House Democratic leader Nancy Pelosi issued a statement saying that when legislation clears the Senate, "I will present it to the House Democratic caucus."

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Senate negotiators yet to reach ‘fiscal cliff’ deal as clock winds down

Vice President Joseph Biden and Sen. Mitch McConnell were locked in urgent talks late Sunday over the “fiscal cliff” after Democrats offered several significant concessions on taxes, including a proposal to raise rates only on earnings over $450,000 a year.

With a New Year’s Eve deadline hours away, Democrats abandoned their earlier demand to raise tax rates on household income over $250,000 a year, as President Obama vowed during the recent presidential campaign.

They also relented on the politically sensitive issue of the estate tax, promising to stage a vote in the Senate that would guarantee that taxes on inherited estates remain at their current low levels, a key GOP demand.

Still, McConnell (R-Ky.) was holding out to set the income threshold for tax increases even higher, at $550,000, according to people close to the talks in both parties. And he was protesting a Democratic proposal to raise taxes on investment profits for households with income above $250,000.

The two sides were also sharply at odds over automatic spending cuts set to decimate budgets at the Pentagon and other federal agencies next month. Democrats were seeking to delay the cuts, known as the “sequester,” until 2015, without identifying other savings to compensate. They were also pressing to extend unemployment benefits, farm subsidies and Medicare payments to doctors, again without offsetting cuts as Republicans demand.

Unless the two sides can reach agreement, historic tax hikes are set to hit virtually every American on Jan. 1, potentially driving the nation back into recession. An impasse would also throw the coming tax filing season into chaos, as nearly 30 million unsuspecting taxpayers would be required to pay the costly alternative minimum tax for the first time.

As Biden and McConnell traded phone calls deep into the night, lawmakers waited anxiously for news. Though members of both parties received lengthy briefings from their respective leaders about the status of the talks, senators were just as likely to predict that the nation was on the verge of a self-inflicted economic crisis as they were to predict that salvation was at hand.

“I think we’re going over the cliff,” Sen. Lindsey O. Graham (R-S.C.) wrote on Twitter in the middle of the day.

“The two parties are so close that they can’t afford to walk away,” Sen. Mike Johanns (R-Neb.) countered hours later. “I continue to be optimistic.”

Biden, a veteran dealmaker who served in the Senate for 36 years, entered the talks Sunday at McConnell’s request after the Republican leader said he had grown “frustrated” by the pace of negotiations with Senate Majority Leader Harry M. Reid (D-Nev.).

Personal relations between the two Senate leaders have deteriorated after two years of draining battles over the budget. On Sunday, their antagonism produced a confusing day when talks seemed to be collapsing even as the two sides were moving closer to agreement on several fundamental issues.

Reid blamed McConnell for the impasse, saying Republicans were insisting on a change in the way inflation is measured that would serve to reduce Social Security benefits — a red flag for Democrats. Early in the day, Democratic aides described McConnell’s continued insistence on the change, known as “chained CPI,” as a ”major setback.”

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Three China ships in waters around disputed islands: Japan

TOKYO: Three Chinese government ships on Monday entered territorial waters around East China Sea islands at the centre of a dispute with Tokyo, Japan's coastguard said.

One of the surveillance ships entered waters around the islands known as Senkaku in Japan and Diaoyu in China at around 1:32pm (0432 GMT), while another followed about 20 minutes later, the coastguard said.

The third vessel entered the waters around the islands, controlled by Tokyo but claimed by Beijing, at about 2:35 pm (0535 GMT), it said.

The ships were spotted by coastguard aircraft which were patrolling the region, and were later ordered by a Japanese patrol vessel to leave the area, the coastguard said.

In response, the third Chinese vessel reiterated Beijing's claim.

"The ship responded in Chinese by saying in essence that Diaoyu and related islands are an inherent part of Chinese territory," a Japanese coastguard spokesman told AFP.

The three ships were still inside what Japan claims as its territorial waters as of 3:50 pm (0650 GMT), the Japanese coastguard said.

China has repeatedly sailed into waters around the disputed islands since Japan nationalised the chain in September.

Beijing sent its ships into the area as recently as December 21, after the conservative Liberal Democratic Party swept to a landslide election victory in Japan.

Newly elected Prime Minister Shinzo Abe has said he wishes to mend Tokyo's ties with Beijing.

But analysts predict that China is unlikely to change its claim to the islands and will probably continue to send its ships into the surrounding waters to bring the world's attention to the dispute.

Earlier in December, a state-owned Chinese plane breached Japanese airspace over the islands. Tokyo responded by scrambling fighter jets and said it was the first time Beijing had breached its airspace since 1958.

- AFP/xq

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Provide leadership to society: Justice Katju asks media

INDORE: Justice Katju (Rtd), the chairman of the Press Council of India, has given a call to the media to provide leadership to society, rather than its role of mere informing. He was addressing a seminar on "Changing landscape of journalism and New Media" in Bhopal recently. He took the occasion to launch a new portal www.mppost.com.

While hailing Sarman Nagele, editor of the portal, for his unique idea at the launching ceremony of Mobile India (Mobile Media), Justice Katju said Mobile media is a new concept of transmitting news and views which is an essential medium in the present circumstances with ever changing technology. He, however, cautioned about Mobile Media's misuse and to prevent its adverse effects he emphasised that there must be some regulations formulated and there should be a code of conduct for it.

Speaking further on the occasion, Justice Katju highlighted in detail on various aspects of journalism and said the role of media should not be only transmitting news but also provide leadership to the society at large.

Referring to the changing landscape of journalism, the media must get to the bottom of the various problems cropping up in society. He said that middle class people are on the streets nowadays because of inflation and unemployment.

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How to Banish That New Year's Eve Hangover

For those of us who enjoy the occasional cocktail, the holiday season would be incomplete without certain treats of the liquid variety. Some look forward to the creamy charms of rum-laced eggnog; others anticipate cupfuls of high-octane punch or mugs of warm, spiced wine.

No matter what's in your glass, raising one as the year winds down is tradition. What could be more festive? The problem is, one drink leads to two, then the party gets going and a third is generously poured. Soon, the music fades and the morning arrives—and with it, the dreaded hangover. (Explore a human-body interactive.)

Whether it's a pounding headache, a queasy stomach, sweating, or just general misery, the damage has been done. So now it's time to remedy the situation. What's the quickest way to banish the pain? It depends who you ask.

Doctors typically recommend water for hydration and ibuprofen to reduce inflammation. Taking B vitamins is also good, according to anesthesiologist Jason Burke, because they help the body metabolize alcohol and produce energy.

Burke should know a thing or two about veisalgia, the medical term for hangover. At his Las Vegas clinic Hangover Heaven, Burke treats thousands of people suffering from the effects of drinking to excess with hydrating fluids and medications approved by the U.S. Food and Drug Administration.

"No two hangovers are the same," he said, adding that the unfavorable condition costs society billions of dollars-mostly from lost productivity and people taking sick days from work.

Hot Peppers for Hangovers?

So what's the advice from the nonmedical community? Suggestions range from greasy breakfasts to vanilla milkshakes to spending time in a steamy sauna. A friend insists hot peppers are the only way to combat a hangover's wrath. Another swears by the palliative effects of a bloody mary. In fact, many people just have another drink, following the old "hair of the dog that bit you" strategy.

Whether such "cures" actually get rid of a hangover is debatable, but one thing's for sure: the sorry state is universal. The only people immune to hangovers are the ones who avoid alcohol altogether.

So for those who do indulge, even if it's just once in awhile, see our interactive featuring cures from around the world (also above). As New Year's Eve looms with its attendant excuse to imbibe, perhaps it would be wise to stock your refrigerator with one of these antidotes. Pickled herring, anyone?

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