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A heart wrenching story of distress in these tough economic times

Source: New York Times
The Neediest Cases
A Stack of Bills, and No Paycheck or Savings
By REBECCA WHITE
Published: November 20, 2010

For Carol Ann Fuoco, 58, things are not the way they used to be.

Ms. Fuoco has lived in the same apartment in Maspeth, Queens, since she was 10. Once, the kitchen in her co-op apartment had brick-patterned wallpaper with ivy poking through the cracks. That was followed by wallpaper with a pattern of strawberries. Now, the walls are apple green.

Her sister married and moved out in the 1970s, but Ms. Fuoco stayed on. She cared for and nursed her parents in the apartment and witnessed their passing: her father died in 1997 of prostate cancer, her mother in 2001, from complications of Alzheimer’s disease. “I made a promise I would never put my parents in a home,” she said.

But the décor has not been the only thing to change over the years. In March, Ms. Fuoco was one of 1,000 people to be laid off from the computer software company where she had been working as an administrative assistant for almost five years. She went from making $59,000 a year to receiving unemployment checks for $405 a week.

A diligent worker, she never had trouble earning money, but she acknowledged she had not been so good about saving it. “I would always try to start and then it never materialized,” she said. “If I had a tax return I would try to start and make an attempt to put it away, but it was hard and wound up not being able to.”

Was she worried about her retirement? “I didn’t plan on retiring any time soon,” she said.

A new job has proved elusive. Ms. Fuoco does not have a bachelor’s degree and so is not able to apply to many jobs for which she feels she is otherwise eligible. Her work experience is strong. She has done administrative work in the corporate sector since her first secretarial job at Pfizer after she graduated from high school.

In those days, reminisced Ms. Fuoco, “you would get dressed up. A suit. Well-groomed. You would go to the human resources department of any company and ask if they had any positions available.”

Today, it’s different. “Everything is done by e-mail,” she said. “You can’t just walk into companies like years ago.”

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Eight months and three interviews after she was laid off, Ms. Fuoco has collected a stack of bills and has become delinquent on her credit card payments. She is struggling with a long list of expenses, including more than $1,000 in monthly co-op maintenance and mortgage fees. To stay afloat, Ms. Fuoco went to her local parish food pantry, which directed her to Catholic Charities Brooklyn and Queens, one of the seven agencies supported by The New York Times Neediest Cases Fund. She received $400 for her September co-op maintenance fee and $159.44 to cover an outstanding phone bill. Unless she is granted an extension, her unemployment benefits will end in February.

Ms. Fuoco, who is registered with several temp agencies and has sent out more than two hundred résumés since March, is fearful of what the future will bring.

“It’s definitely taking a toll on her nerves,” said her nephew, Joseph Macchia, 37. Mr. Macchia has been living with Ms. Fuoco since 1996 and has been able to help with food, MetroCards and cable and Internet expenses.

Ms. Fuoco still wakes up early and immediately goes onto the Internet to search for jobs. She is also on the board of directors of her nephew’s not-for-profit organization, Help is on the Way Today, which raises money for children living with H.I.V. and AIDS.

Right now they are organizing a toy drive. “It gives me self-satisfaction, like I made a difference,” Ms. Fuoco said. “Putting a smile on the kids’ faces. I love kids.”

A version of this article appeared in print on November 21, 2010, on page A28 of the New York edition.

North Korea built Uranium enriched facility in the face of UN nuclear watchdogs

Scientist: NKorea has 'stunning' new nuke facility

By FOSTER KLUG, Associated Press Foster Klug, Associated Press – Sun Nov 21, 2010 10:59 am ET

SEOUL, South Korea – North Korea's claim of a new, highly sophisticated uranium enrichment facility could be a ploy to win concessions in nuclear talks or an attempt to bolster leader Kim Jong Il's apparent heir.

But whatever the reason for the revelation, which a seasoned American nuclear scientist called "stunning," it provides a new set of worries for the Obama administration, which is sending its special envoy on North Korea for talks with officials in South Korea, Japan and China this week.

The scientist, Siegfried Hecker, said in a report posted Saturday that he was taken during a recent trip to the North's main Yongbyon atomic complex to a small industrial-scale uranium enrichment facility. It had 2,000 recently completed centrifuges, he said, and the North told him it was producing low-enriched uranium meant for a new reactor.

Hecker, a former director of the U.S. Los Alamos Nuclear Laboratory who is regularly given rare glimpses of the North's secretive nuclear program, said the program had been built in secret and with remarkable speed.

Adm. Mike Mullen, chairman of the U.S. Joint Chiefs of Staff, said uranium enrichment activities would violate U.N. resolutions and agreements by North Korea over its nuclear program.

"From my perspective, it's North Korea continuing on a path which is destabilizing for the region. It confirms or validates the concern we've had for years about their enriching uranium," Mullen, the top U.S. military officer, said on CNN's "State of the Union."

The Obama administration has shunned direct negotiations with North Korea following its nuclear and missile tests last year and in the wake of an international finding that a North Korean torpedo sank a South Korean warship in March, killing 46 sailors.

North Korea told Hecker it began construction on the centrifuges in April 2009 and finished only a few days before the scientist's Nov. 12 visit.

Hecker said his first glimpse of the North's new centrifuges was "stunning."

"Instead of seeing a few small cascades of centrifuges, which I believed to exist in North Korea, we saw a modern, clean centrifuge plant of more than a thousand centrifuges, all neatly aligned and plumbed below us," wrote Hecker, a Stanford University professor.

Hecker described the control room as "astonishingly modern," writing that, unlike other North Korean facilities, it "would fit into any modern American processing facility."

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The facilities appeared to be primarily for civilian nuclear power, not for North Korea's nuclear arsenal, Hecker said. He saw no evidence of continued plutonium production at Yongbyon. But, he said, the uranium enrichment facilities "could be readily converted to produce highly enriched uranium bomb fuel."

Uranium enrichment would give the North a second way to make atomic bombs, in addition to its known plutonium-based program. At low levels, uranium can be used in power reactors, but at higher levels it can be used in nuclear weapons. Hecker's findings were first reported in The New York Times.

U.S. nuclear envoy Stephen Bosworth's trip to Asia for talks on North Korea comes as new satellite images show construction under way at Yongbyon. That, combined with reports from Hecker and another American expert who recently traveled to the atomic complex, appear to show that the North is keeping its pledge to build a nuclear power reactor.

North Korea vowed in March to build a light-water reactor using its own nuclear fuel. Hecker, and Jack Pritchard, a former U.S. envoy for negotiations with North Korea, have said that construction has begun.

Yang Moo-jin, a professor at the Seoul-based University of North Korean Studies, said the North's uranium disclosure is meant to force the United States back into nuclear negotiations.

The disclosure, Yang said, also is aimed at a domestic audience during the succession process. "The North wants to muster loyalty among military generals by showing them the North will continue to bolster its nuclear deterrent and uphold its military-first policy," Yang said.

Light-water reactors are ostensibly for civilian energy purposes, but such a power plant would give the North a reason to enrich uranium. While light-water reactors are considered less prone to misuse than heavy-water reactors, once the process of uranium enrichment is mastered, it is relatively easy to enrich further to weapons-grade levels.

North Korea said last year it was in the final stage of enriching uranium, sparking worries that the country may add uranium-based weapons to its stockpile of bombs made from plutonium. Experts say the North has yielded enough weaponized plutonium for at least a half dozen atomic bombs.

Uranium can be enriched in relatively inconspicuous factories that are better able to evade spy satellite detection, according to U.S. and South Korean experts. Uranium-based bombs may also work without requiring test explosions like the two carried out by North Korea in 2006 and 2009 for plutonium-based weapons.

Hecker said the North Koreans emphasized that the centrifuge facility was operating; although he couldn't verify that statement, he said "it was not inconsistent with what we saw."

"The only hope" for dealing with the North's nuclear program "appears to be engagement," he wrote, calling a military attack "out of the question" and more sanctions "likewise a dead end."

Many questions are still unanswered about North Korea's nuclear program, Hecker wrote, including whether the North is really pursuing nuclear electricity, whether it's abandoning plutonium production, how it obtained such sophisticated centrifuge technology, and why it's revealing the facilities now.

"One thing is certain," he said. "These revelations will cause a political firestorm."

Walk your way through Steve Jobs' naughty list

Source: Fortune

How to get on Steve Jobs' naughty list

Posted by Philip Elmer-DeWitt
November 19, 2010 1:45 PM

If T.J. Maxx had dreams of becoming an Apple reseller, it can forget them now



Few companies keep as tight reins on their retail partners -- and on the suggested retail prices of their products -- as Apple (AAPL).
Which is why Engadget's discovery Thursday that the discount chain T.J. Maxx (TJX) was selling $499 iPads for $399.99 -- or $350 plus tax if you sign up for a T.J. Maxx credit card on the spot and apply for all the rebates -- created such a stir.
Apple's internal pricing is a tightly guarded secret, but it's believed that its discounts to resellers are in the 5% to 10% range. In other words, even BestBuy (BBY) is paying Apple between $450 and $475 for every entry-level iPad.
So what's going on? Is Apple offloading excess inventory, as some have suggested? Clearing shelves for a new iPad? Discontinuing the Wi-Fi-only model? Slashing prices to kill the competition?
None of the above, if the e-mail below, attributed to Steve Jobs, can be taken at face value.



Piper Jaffray's (PJC) Andrew Murphy has heard that T.J. Maxx's total supply of iPads is about 80 units, which could have been purchased as a loss leader anywhere -- including Apple's own stores -- for $40,000, and then re-sold for $32,000.
"It's obviously irritating to Apple that they're getting used this way," says PJC's Gene Munster. "But for $8,000, it's a brilliant marketing strategy."
Maybe not so brilliant, if T.J. Maxx had hoped someday to become an authorized Apple reseller.
"Now they're on Steve's naughty list," says Murphy. "And they're never coming off."

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 Update: Sherry Lang, SVP of Global Communications for TJX told us:
"We have received many inquiries about a particular famous maker high tech item recently sold in our stores. As an off-price retailer, our business provides an ever-changing selection of great finds of famous maker apparel and non-apparel categories at excellent values. In other words, our mission is to offer a treasure hunt of great values, every day. Earlier this week, a small number of T.J.Maxx and Marshalls stores received a very limited quantity of first quality electronic tablets that were sourced from a retailer. Our customers have come to know and shop us for the exciting and unexpected values we offer on a daily basis."

Economy - World's economies at risk without solid. How to prevent it?

Source: The Economist

A special report on the world economy

How to grow

Without faster growth the rich world’s economies will be stuck. But what can be done to achieve it? Our economics team sets out the options 

Oct 7th 2010
WHAT will tomorrow’s historians see as the defining economic trend of the early 21st century? There are plenty of potential candidates, from the remaking of finance in the wake of the crash of 2008 to the explosion of sovereign debt. But the list will almost certainly be topped by the dramatic shift in global economic heft.
Ten years ago rich countries dominated the world economy, contributing around two-thirds of global GDP after allowing for differences in purchasing power. Since then that share has fallen to just over half. In another decade it could be down to 40%. The bulk of global output will be produced in the emerging world.
The pace of the shift testifies to these countries’ success. Thanks to globalisation and good policies, virtually all developing countries are catching up with their richer peers. In 2002-08 more than 85% of developing economies grew faster than America’s, compared with less than a third between 1960 and 2000, and virtually none in the century before that.
In this special report
This “rise of the rest” is a remarkable achievement, bringing with it unprecedented improvements in living standards for the majority of people on the planet. But there is another, less happy, explanation for the rapid shift in the global centre of economic gravity: the lack of growth in the big rich economies of America, western Europe and Japan. That will be the focus of this special report.
The next few years could be defined as much by the stagnation of the West as by the emergence of the rest, for three main reasons. The first is the sheer scale of the recession of 2008-09 and the weakness of the subsequent recovery. For the advanced economies as a whole, the slump that followed the global financial crisis was by far the deepest since the 1930s. It has left an unprecedented degree of unemployed workers and underused factories in its wake. Although output stopped shrinking in most countries a year ago, the recovery is proving too weak to put that idle capacity back to work quickly (see chart 1). The OECD, the Paris-based organisation that tracks advanced economies, does not expect this “output gap” to close until 2015.
The second reason to worry about stagnation has to do with slowing supply. The level of demand determines whether economies run above or below their “trend” rate of growth, but that trend rate itself depends on the supply of workers and their productivity. That productivity in turn depends on the rate of capital investment and the pace of innovation. Across the rich world the supply of workers is about to slow as the number of pensioners rises. In western Europe the change will be especially marked. Over the coming decade the region’s working-age population, which until now has been rising slowly, will shrink by some 0.3% a year. In Japan, where the pool of potential workers is already shrinking, the pace of decline will more than double, to around 0.7% a year. America’s demography is far more favourable, but the growth in its working-age population, at some 0.3% a year over the coming two decades, will be less than a third of the post-war average.
Our interactive "Global Debt Clock" calculates and compares all governments' debt
With millions of workers unemployed, an impending slowdown in the labour supply might not seem much of a problem. But these demographic shifts set the boundaries for rich countries’ medium-term future, including their ability to service their public debt. Unless more immigrants are allowed in, or a larger proportion of the working-age population joins the labour force, or people retire later, or their productivity accelerates, the ageing population will translate into permanently slower potential growth.
Calculations by Dale Jorgenson of Harvard University and Khuong Vu of the National University of Singapore make the point starkly. They show that the average underlying annual growth rate of the G7 group of big rich economies between 1998 and 2008 was 2.1%. On current demographic trends, and assuming that productivity improves at the same rate as in the past ten years, that potential rate of growth will come down to 1.45% a year over the next ten years, its slowest pace since the second world war.
Faster productivity growth could help to mitigate the slowdown, but it does not seem to be forthcoming. Before the financial crisis hit, the trend in productivity growth was flat or slowing in many rich countries even as it soared in the emerging world. Growth in output per worker in America, which had risen sharply in the late 1990s thanks to increased output of information technology, and again in the early part of this decade as the gains from IT spread throughout the economy, began to flag after 2004. It revived during the recession as firms slashed their labour force, but that boost may not last. Japan’s productivity slumped after its bubble burst in the early 1990s. Western Europe’s, overall, has also weakened since the mid-1990s.
The third reason to fret about the rich world’s stagnation is that the hangover from the financial crisis and the feebleness of the recovery could themselves dent economies’ potential. Long periods of high unemployment tend to reduce rather than augment the pool of potential workers. The unemployed lose their skills, and disillusioned workers drop out of the workforce. The shrinking of banks’ balance-sheets that follows a financial bust makes credit more costly and harder to come by.
Optimists point to America’s experience over the past century as evidence that recessions, even severe ones, need not do lasting damage. After every downturn the economy eventually bounced back so that for the period as a whole America’s underlying growth rate per person remained remarkably stable (see chart 2). Despite a lack of demand, America’s underlying productivity grew faster in the 1930s than in any other decade of the 20th century. Today’s high unemployment may also be preparing the ground for more efficient processes.
Most economists, however, reckon that rich economies’ capacity has already sustained some damage, especially in countries where much of the growth came from bubble industries like construction, as in Spain, and finance, as in Britain. The OECD now reckons that the fallout from the financial crisis will, on average, knock some 3% off rich countries’ potential output. Most of that decline has already occurred.
The longer that demand remains weak, the greater the damage is likely to be. Japan’s experience over the past two decades is a cautionary example, especially to fast-ageing European economies. The country’s financial crash in the early 1990s contributed to a slump in productivity growth. Soon afterwards the working-age population began to shrink. A series of policy mistakes caused the hangover from the financial crisis to linger. The economy failed to recover and deflation set in. The result was a persistent combination of weak demand and slowing supply.
To avoid Japan’s fate, rich countries need to foster growth in two ways, by supporting short-term demand and by boosting long-term supply. Unfortunately, today’s policymakers often see these two strategies as alternatives rather than complements. Many of the Keynesian economists who fret about the lack of private demand think that concerns about economies’ medium-term potential are beside the point at the moment. They include Paul Krugman, a Nobel laureate and commentator in the New York Times, and many of President Barack Obama’s economic team.

Stimulus v austerity
European economists put more emphasis on boosting medium-term growth, favouring reforms such as making labour markets more flexible. They tend to reject further fiscal stimulus to prop up demand. Jean-Claude Trichet, the president of the European Central Bank, is a strong advocate of structural reforms in Europe. But he is also one of the most ardent champions of the idea that cutting budget deficits will itself boost growth. All this has led to a passionate but narrow debate about fiscal stimulus versus austerity.
This special report will argue that both sides are blinkered. Governments should think more coherently about how to support demand and boost supply at the same time. The exact priorities will differ from country to country, but there are several common themes. First, the Keynesians are right to observe that, for the rich world as a whole, there is a danger of overdoing the short-term budget austerity. Excessive budget-cutting poses a risk to the recovery, not least because it cannot easily be offset by looser monetary policy. Improvements to the structure of taxation and spending matter as much as the short-term deficits.
Second, there is an equally big risk of ignoring threats to economies’ potential growth and of missing the opportunity for growth-enhancing microeconomic reforms. Most rich-country governments have learned one important lesson from previous financial crises: they have cleaned up their banking sectors reasonably quickly. But more competition and deregulation deserve higher billing, especially in services, which in all rich countries are likely to be the source of most future employment and productivity growth.

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Instead, too many governments are determined to boost innovation by reinventing industrial policy. Making the jobless more employable should be higher on the list, especially in America, where record levels of long-term unemployment suggest that labour markets may not be as flexible as many people believe.
Faster growth is not a silver bullet. It will not eliminate the need to trim back unrealistic promises to pensioners; no rich country can simply grow its way out of looming pension and health-care commitments. Nor will it stop the relentless shift of economic gravity to the emerging world. Since developing economies are more populous than rich ones, they will inevitably come to dominate the world economy. But whether that shift takes place against a background of prosperity or stagnation depends on the pace of growth in the rich countries. For the moment, worryingly, too many of them seem to be headed for stagnation.

Economy - Is Japan adapting to its aging population?

Source: The Economist

A special report on Japan

Into the unknown

Japan is ageing faster than any country in history, with vast consequences for its economy and society. So why, asks Henry Tricks, is it doing so little to adapt? 

Nov 18th 2010
FOR a glimpse of Japan’s future, a good place to visit is Yubari, a former mining town on the northern island of Hokkaido, which four years ago went spectacularly bust with debts of ¥36 billion ($315m). It is a quiet spot, nestled in a valley at the end of a railway line. When the coal mines were working 40 years ago, 120,000 people lived there. But the mines have long since closed, and now there are only 11,000 people left, almost half of them over 65.
The town hall is like a morgue, with few lights on. In the past four years the number of civil servants has been cut in half, their salaries have shrunk by a third and they now have to mop their own floors, they complain. The town has embarked on an 18-year austerity drive to repay its debts. The public library has already closed down. This autumn six primary schools merged into one.
Even so the townspeople look anything but defeated. A group of 80-year-olds chatting in one café is the backbone of the local photography club. Delighted to have an audience, they show off black-and-white pictures taken in the 1950s, with children swirling around the school playground on ice skates.

Like Yubari, Japan is heading into a demographic vortex. It is the fastest-ageing society on Earth and the first big country in history to have started shrinking rapidly from natural causes. Its median age (44) and life expectancy (83) are among the highest and its birth rate (1.4 per woman) is among the lowest anywhere. In the next 40 years its population, currently 127m, is expected to fall by 38m. By 2050 four out of ten Japanese will be over 65.

Like Yubari, Japan is also deeply in debt. But whereas Yubari’s fiscal problems arose from a huge public-spending splurge aimed at wooing back its young people (at one point it had an international film festival and 17 cinemas), Japan at the start of its journey into the demographic unknown already has one of the highest debt-to-GDP ratios in the world.
Japan is already full of Yubaris. Between 2000 and 2005 the number of people living in small towns and villages across Japan fell by 10m. Only shimmering cities like Tokyo continue to swell, but even they will start to look old within a few decades.

What matters most for Japan’s economic growth prospects is the decline in its working-age population, those aged 15-64, which has been shrinking since 1996. For about 50 years after the second world war the combination of a fast-growing labour force and the rising productivity of its famously industrious workers created a growth miracle. Within two generations the number of people of working age increased by 37m and Japan went from ruins to the world’s second-largest economy.
In the next 40 years that process will go into reverse (see chart 1). The working-age population will shrink so quickly that by 2050 it will be smaller than it was in 1950. Unless Japan’s productivity rises faster than its workforce declines, which seems unlikely, its economy will shrink. This year it was overtaken by China in size.

The impact will become even clearer in 2012 when the first members of the 1947-49 baby-boom generation hit 65. From then on, some believe, demography will seriously aggravate Japan’s other D-words—debt, deficits and deflation. Unless the retirement age rises in lockstep with life expectancy, ageing will automatically push up pension costs, further straining public finances. Shigesato Takahashi, a senior government demographer, says it will “rock the foundations” of Japan’s social-security system. It may also entrench deflation. A shortage of workers might push up wage costs, but companies will be loth to invest in new factories.
This will make Japan a test case of how big countries across the world should handle ageing and population decline. Western Europe’s working-age population is already shrinking, though not as fast as Japan’s. East Asia, too, will watch Japan intently. Its industrial-growth model has closely resembled Japan’s in its post-war boom, rising on the same tide of an expanding workforce and export-led productivity gains. Japan has been called the lead goose in that V-formation. For now, as Florian Coulmas, a population expert at Tokyo’s German Institute for Japanese Studies, puts it, Japan is “the oldest goose”. But South Korea’s and China’s working-age populations too will soon start to shrink.
One of the unfortunate side-effects of ageing in Japan is that it will be the young who suffer the most. Although unemployment levels may remain among the lowest in the rich world, many of the jobs will be lowly ones. The children of the baby-boomers are currently entering their 40s, which creates a secondary bulge at the middle-manager level of Japanese business. Because of a seniority-based pay system, this puts a huge strain on business costs, leaving less money to provide young people with training and good jobs.
It is sometimes said that Japan’s risk appetite mirrors that of its baby-boomers. In the prime of their working lives they wanted to conquer the world with their products. Now, in their 60s, they want a quieter life. The same seems to go for the country as a whole.
Yet to support them in their retirement, and provide the generations that follow them with the economic opportunities they need, Japan cannot afford to drift. When there is no ambulance to answer a pensioner’s anguished telephone call, as sometimes happens in Yubari, the consequences become all too clear. When couples find they cannot afford to care for a bedbound parent, let alone a young child, demography becomes a social disaster.

Sirens wailing
This special report will argue that Japan must tackle this issue head on. It needs a grand plan for an ageing population. “From a business standpoint, right now the threat [of ageing] overwhelms the opportunity,” says Yoshiaki Fujimori, head of GE in Japan. “Most people are aware of it, but they don’t know how to cope with it.” Boosting productivity to counter the effects of a shrinking workforce will require a cultural revolution, especially in business. Embracing the markets opening up in Asia will mean overcoming 150 years of mistrust of Asia (heartily reciprocated).
There are two reasons for guarded optimism, though. One is that, unlike a lot of rich countries, Japan has not forsaken its industrial heritage. It has a cohesive workforce and it can still come up with innovative products.
The other reason for hope is political. Japan made a huge bid for fresh thinking last year when it ended the one-party rule that had, in effect, been in place since 1955. The Democratic Party of Japan (DPJ) that won the 2009 election, now led by Naoto Kan, has bungled much of its first year in office, but its victory alone was a clear indication of voters’ growing impatience with politics as usual. Now the party will need to show that it can deliver.

Pope Benedict XVI says that condoms can be justified in some cases

By NICOLE WINFIELD and FRANCES D'EMILIO, Associated Press
Saturday November 20, 2010

VATICAN CITY – Pope Benedict XVI says in a new book that condoms can be justified for male prostitutes seeking to stop the spread of HIV, a stunning comment for a church criticized for its opposition to condoms and for a pontiff who has blamed them for making the AIDS crisis worse.

The pope made the comments in a book-length interview with a German journalist, "Light of the World: The Pope, the Church and the Signs of the Times," which is being released Tuesday. The Vatican newspaper ran excerpts on Saturday.

Church teaching has long opposed condoms because they are a form of artificial contraception, although it has never released an explicit policy about condoms and HIV. The Vatican has been harshly criticized for its opposition.

Benedict said that condoms are not a moral solution. But he said in some cases, such as for male prostitutes, they could be justified "in the intention of reducing the risk of infection."

Benedict called it "a first step in a movement toward a different way, a more human way of living sexuality."

He used as an example male prostitutes, for whom contraception is not an issue, as opposed to married couples where one spouse is infected. The Vatican has come under pressure from even some church officials in Africa to condone condom use for monogamous married couples to protect the uninfected spouse from getting infected.

Benedict drew the wrath of the United Nations, European governments and AIDS activisits when he told reporters en route to Africa in 2009 that the AIDS problem on the continent couldn't be resolved by distributing condoms.

"On the contrary, it increases the problem," he said then.

Journalist Peter Seewald, who interviewed Benedict over the course of six days this summer, raised the Africa condom comments and asked Benedict if it wasn't "madness" for the Vatican to forbid a high-risk population to use condoms.

"There may be a basis in the case of some individuals, as perhaps when a male prostitute uses a condom, where this can be a first step in the direction of a moralization, a first assumption of responsibility," Benedict said.

But he stressed that it wasn't the way to deal with the evil of HIV, and elsewhere in the book reaffirmed church teaching on contraception and abortion, saying: "How many children are killed who might one day have been geniuses, who could have given humanity something new, who could have given us a new Mozart or some new technical discovery?"

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He reiterated the church's position that abstinence and marital fidelity is the only sure way to prevent HIV.

Cardinal Elio Sgreccia, the Vatican's longtime top official on bioethics and sexuality, elaborated on the pontiff's comments, stressing that it was imperative to "make certain that this is the only way to save a life." Sgreccia told the Italian news agency ANSA that that is why the pope on the condom issue "dealt with it in the realm of ecceptionality."

The condom question was one that "needed an answer for a long time," Sgreccia was quoted as saying. "If Benedict XVI raised the question of exceptions, this expection must be accepted ... and it must be verified that this is the only way to save life. This must be demonstrated," Sgreccia said.

Christian Weisner, of the pro-reform group We Are Church in the pope's native Germany, said the pope's comments were "surprising, and if that's the case one can be happy about the pope's ability to learn."

William Portier, a Catholic theologian at the University of Dayton, a Marianist school in Ohio, said he had not read the report in the Vatican newspaper, but he said it would be wrong to conclude that the comments mean the pope has made a fundamental, broad change in church teaching on artificial contraception.

"He's not going to do that in an offhand remark to a journalist in an interview," Portier said.

In other comments, Benedict said:

• If a pope is no longer physically, psychologically or spiritually capable of doing his job, then he has the "right, and under some circumstances, also an obligation to resign."

• On Islam, in Europe, he declined to endorse such moves as France's banning the burqa or Switzerland's citizen referendum to forbid topping mosques with minarets.

"Christians are tolerant, and in that respect they also allow others to have their self-image," Benedict replied when asked if Christians should be "glad" about such initiatives. "As for the burqa, I can see no reason for a general ban."

• He was surprised by the scale of clerical sex abuse in his native Germany and acknowledged that the Vatican could have better communicated its response. "One can always wonder whether the pope should not speak more often."

• On Pope Pius XII, the wartime pontiff accused by some Jewish groups of staying publicly silent on the Holocaust: Some historians have asked the Vatican to put Pius' sainthood process on hold until the Holy See opens up its archives from his papacy. But Benedict said an internal "inspection" of those unpublished documents failed to support "negative" allegations against Pius.

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"It is perfectly clear that as soon as he protested publicly, the Germans would have ceased to respect" Vatican extraterritoriality of convents and monasteries who were sheltering Jews from the Nazi occupiers in Rome. "The thousands who had found a safe haven ... would have been surely deported," Benedict argued.

In the book, Benedict also offers insights into his private life, saying he enjoys watching TV at home in the evenings with his secretaries and the four women who take care of his apartment, preferring the evening news and an Italian TV show from decades ago "Don Camillo and Peppone" about a parish priest and his bumbling assistant.

He said he always wears his white cassock, never a sweater, and wears an old Junghans watch that was left to him by his sister when she died. When he prays, he said, he prays to the Lord as well as the saints and considers himself good friends with Sts. Augustine, Bonaventure and Thomas Aquinas.

Obama: NATO will erect missile shield for Europe

By ROBERT BURNS and JULIE PACE, Associated Press Robert Burns And Julie Pace, Associated Press 
LISBON, Portugal – President Barack Obama won NATO summit agreement Friday to build a missile shield over Europe, an ambitious commitment to protect against Iranian attack while demonstrating the alliance's continuing relevance — but at the risk of further aggravating Russia.
On another major issue, Obama and the allies are expected to announce plans on Saturday to begin handing off security responsibility in Afghanistan to local forces next year and to complete the transition by the end of 2014.
That end date is three years beyond the time that Obama has said he will start withdrawing U.S. troops, and the challenge is to avoid a rush to the exits as public opinion turns more sharply against the war and Afghan President Hamid Karzai pushes for greater Afghan control.
While celebrating the missile shield decision, Obama also made a renewed pitch for Senate ratification back in the U.S. of a nuclear arms treaty with Russia, asserting that Europeans believe rejection of the deal would hurt their security and damage relations with the Russians.
Two key unanswered questions about the missile shield — will it work and can the Europeans afford it? — were put aside for the present in the interest of celebrating the agreement as a boost for NATO solidarity.
"It offers a role for all of our allies," Obama told reporters. "It responds to the threats of our times. It shows our determination to protect our citizens from the threat of ballistic missiles." He did not mention Iran by name, acceding to the wishes of NATO member Turkey, which had threatened to block the deal if its neighbor was singled out.
Under the arrangement, a limited system of U.S. anti-missile interceptors and radars already planned for Europe — to include interceptors in Romania and Poland and possibly a radar in Turkey — would be linked to expanded European-owned missile defenses. That would create a broad system that protects every NATO country against medium-range missile attack.
NATO plans to invite Russia to join the missile shield effort, although Moscow would not be given joint control. The gesture would mark a historic milestone for the alliance, created after World War II to defend Western Europe against the threat of an invasion by Soviet forces.

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As for the U.S.-Russia arms treaty, Obama was backed by NATO Secretary General Anders Fogh Rasmussen of Denmark, who told reporters that the treaty, called New START and signed last April by Obama and Russian President Dmitry Medvedev, would improve security not only in Europe but beyond.
"I would strongly regret if it is delayed," Fogh Rasmussen said. "A delay would be damaging for security in Europe, and I urge all parties involved to ratify it." Obama needs 67 votes in the Senate for ratification, and many Republicans have balked at even taking a vote before the new, more heavily GOP Congress convenes in January.
The allies opened their summit by agreeing on the first rewrite of NATO's basic mission — formally called its "strategic concept" — since 1999. They reaffirmed their bedrock commitment that an attack on one would be treated as an attack on all. In that context, the agreement to build a missile defense for all of Europe is meant to strengthen the alliance.
What remains in conflict, however, is the question of the future role of nuclear weapons in NATO's basic strategy. The document members agreed to Friday says NATO will retain an "appropriate mix of nuclear and conventional capabilities" to deter a potential aggressor. Germany and some other NATO members want U.S. nuclear weapons withdrawn from Europe.
Non-government advocates of the German view were quick to criticize what they saw as a missed opportunity here for further nuclear disarmament.
"In an astonishing demonstration of weakness, NATO heads of state have failed to tackle the Cold War legacy of the deployment of U.S. nuclear gravity bombs in Europe, threatening the credibility of NATO members' claims to be interested in non-proliferation and global disarmament," said Paul Ingram, executive director of the British American Security Information Council in London.
The specter of continued stalemate in Afghanistan hung over the Lisbon summit.
Karzai will be joining the NATO allies for the Saturday session, and Gen. David Petraeus, the top U.S. and NATO commander in Afghanistan, is to make a closed-door presentation spelling out his vision of how to make a transition to Afghan control. Petraeus is expected to emphasize that stepped-up military operations this year, with the addition of thousands more U.S. combat troops, have made strides toward weakening the Taliban and eventually creating the conditions for peace negotiations. But he also is believed to be concerned that the transition not turn into a departure before Afghanistan is stable.
Obama said Afghanistan, launch pad for the Sept. 11, 2001, attacks on New York and Washington, must get ready for the start of a shift away from reliance on U.S. and NATO combat power "as we move toward a new phase, a transition to Afghan responsibility beginning in 2011 with Afghan forces taking the lead for security across Afghanistan by 2014."
A key question: Will Afghan security forces and the central government be ready to take full responsibility by then?
Mark Sedwill, the top NATO civilian official in Afghanistan, told reporters in Lisbon that it was possible the transition could be completed before 2014, although it's not yet clear whether even that date will mark the end of NATO combat there.
A member of Karzai's delegation to the summit, former Afghan finance minister Ashraf Ghani, said in an Associated Press interview that once 2014 is set as the target date, NATO needs to work with Kabul to establish milestones to get there.
"We as Afghans are responsive to our public opinion, and our public opinion is raising these issues, and what is fortunate is now, NATO has become ... a listening organization," Ghani said on the sidelines of the summit.
Stating the U.S. view in clear terms, Pentagon press secretary Geoff Morrell had said Thursday that 2014 is an "aspirational goal," not a deadline either for Afghan forces to take full control or for a complete withdrawal of U.S. forces.
Secretary of State Hillary Rodham Clinton, who met privately with Karzai on Friday, said earlier that despite the economic burdens faced by much of Europe and the U.S., she believes the war campaign must go on.
"The challenge posed by radical extremists who utilize terror to promote their agenda is one that threatens the people of Portugal, the people of Europe, the people of the United States and, indeed, nations around the world," Clinton said.
Her comments seemed aimed at slowing any rush to withdrawal by allies who believe military force is not the solution in Afghanistan. Canada, for example, is ending its combat mission next year while keeping 950 troops there in a support role.
The summit comes in a pivotal period for NATO, whose relevance is questioned by some who view the alliance as a relic. The adversary that prompted NATO's creation in 1949 — the Soviet Union along with its Warsaw Pact allies — no longer exists.
After NATO's rapid expansion over the past decade and a half — growing from 16 members to 28 — the gap in military prowess between the U.S. and most of the rest of the alliance has widened to the point where the basic nature of the defense partnership is in doubt.
Rasmussen told Friday's opening session that it's time for NATO countries to start "cutting fat and investing in muscle."

U.S. President Barack Obama, right, shakes hands with Portuguese Foreign Minister Luis Amado as he arrives for a NATO summit in Lisbon on Friday, Nov. 19, 2010. U.S. President Barack Obama and the leaders of NATO's 27 other member nations will open a two-day summit Friday aimed at finding ways to keep the Cold War alliance relevant in the 21st century with revamped roles including ballistic missile defense, anti-piracy patrols, and counterterrorism.… Read more »
(AP Photo/Andre Kosters, Pool)
This is where the U.S. push for a NATO missile defense comes in. It would require a lot of money from European countries — estimated at 200 million euros, or about $260 million, over 10 years — and a commitment to a more active type of defense.
It also risks aggravating Russia, which has expressed worry that missile defenses could undermine the deterrent value of its own nuclear arsenal.
Ivo Daalder, the U.S. ambassador to NATO, took a positive view of prospects for working with Moscow.
"I believe we will find Russia and NATO will now decide that this is a time we move forward together on how to cooperate," said Daalder, though he said Saturday's meetings weren't likely to result in concrete agreements on missile defense cooperation.
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