Rabu, 21 Desember 2011

Microsoft pulling out of Consumer Electronics Show after 2012

Microsoft Corp., a 20-year stalwart of the annual Consumer Electronics Show, has decided to pull out of the largest trade show of its kind.

The company's chief executive often gave the keynote address, highlighting its own products and broader tech trends. But the company said it would stop doing so after the 2012 CES. It also will no longer have an exhibit.

CES is one of the world's largest trade shows and annually attracts more than 100,000 visitors to Las Vegas from all over the globe. This year the show will have close to 2,700 exhibitors and more than 1.8 million square feet of floor space.

But the show, once a marquee launchpad for some of the biggest new technologies, has struggled to stay in the headlines as big companies increasingly announce new products on their own timeline. In 2011, some observers questioned the show's relevance when no blockbuster new products were announced. Instead, most companies chose to introduce marginally improved televisions, tablets and smartphones that largely resembled existing products.

Apple Inc., arguably the industry's most popular and innovative company, does not participate in the show.

"Our industry moves fast and changes faster," Microsoft said in a statement. "And so the way we communicate with our customers must change in equally speedy ways."

The company said its decision came after it asked itself, "Are we doing something because it's the right thing to do, or because 'it's the way we've always done it'?"

Microsoft Chief Executive Steve Ballmer will give the final keynote Jan. 9.


Copyright © 2011, Los Angeles Times

Verizon says it fixed network problem

Uh oh! It seems that it's not a good day to be a Verizon Wireless user. Based on an overwhelming number of reports in support forums, the cellular provider's customers are experiencing 3G and 4G data outages across the U.S. right now.

We've reached out to Verizon for more information about the issue and will update this story once we hear back, but in the meantime we're checking on the complaints in Verizon's own support forums.

Users are reporting trouble maintaining a steady data connection as well as misleading connectivity statuses (some devices are displaying icons which suggest connectivity, but no actual connection occurs). According to the folks at The Verge — who have been keeping track of the origins of the posts — the reports are coming in from "pretty much everywhere" including California, Rhode Island, Virginia, Pennsylvania, Nevada, New Jersey, and New York.

Are you a Verizon customer and experiencing issues with your data connection? Please let us know in the comments below.

Update: Verizon Wireless responded to us with a brief note stating that things should be getting back to normal:

Verizon Wireless 4G LTE service is returning to normal this morning after company engineers worked to resolve an issue with the 4G network during the early morning hours today. Throughout this time, 4G LTE customers were able to make voice calls and send and receive text messages. The 3G data network operated normally.

Wireless analyst Jeff Kagan chimed in to point out that it's not particularly surprising that an outage like this occurred in the first place. "As the wireless world becomes more about wireless data we can experience more of these outages," he says. He also offers some words of warning:

Expect wireless data traffic to explode during the holidays starting this week with Chanukah, then Christmas and the weeks following. We should brace for impact of all those users gobbling all that wireless data. Sounds like the right atmosphere for outages and slowdowns.

Updated at 6:45 p.m. ET: Verizon Wireless said it has fixed the data service problem, the second high-profile service problem this month for the company. The carrier said the problem with its 4G network was resolved by 2 p.m. ET, with data service restored for all customers of the 4G network late in the day. Verizon did not explain the cause of the problem. While some customers had complained online of problems with the older 3G service on Wednesday, company spokesman Tom Pica said 3G devices had not been affected. Verizon Wireless said that voice and text services had not stopped working — Reuters

Bank of America Pays $335M to Settle Countrywide Case

NEW YORK (TheStreet) -- Bank of America(BAC) will pay $335 million to settle U.S. Department of Justice charges that alleged discriminatory lending practices by its Countrywide Financial unit.

The settlement will be the largest residential fair lending settlement in history and will compensate thousands of African-American and Hispanic borrowers who were victims of the alleged discriminatory practice.

The Department of Justice alleged that Countrywide discriminated against African-American and Hispanic borrowers in their mortgage lending practices between 2004 and 2008. The allegations predate Bank of America's purchased of Countrywide in 2008.

The DOJ has been probing into unfair lending practices by Countrywide and other banks, such as exclusion of borrowers in low-income or minority neighborhoods and pricing discrimination solely based on race or origin.

It alleges that Countrywide charged more than 200,000 African-American and Hispanic borrowers higher fees than non-Hispanic white borrowers in both retail and wholesale lending.

Countrywide also allegedly steered thousands of African-American and Hispanic borrowers into subprime mortgages when non-Hispanic white borrowers with similar credit profiles received prime loans. Subprime loans carry higher cost terms such as prepayment penalties and adjustable interest rates that jumped suddenly after two or three years, making payments unaffordable.

Attorney General Eric Holder stressed in his statement that the borrowers discriminated against were "qualified" for Countrywide mortgage loans according to the bank's criteria and were charged more not because of "borrower risk" but because of their race or origin.

"The department's action against Countrywide makes clear that we will not hesitate to hold financial institutions accountable, including one of the nation's largest, for lending discrimination," said Attorney General Eric Holder. "With today's settlement, the federal government will ensure that the more than 200,000 African-American and Hispanic borrowers who were discriminated against by Countrywide will be entitled to compensation."

The settlement requires Countrywide to implement policies and practices to prevent discrimination if it returns to the lending business during the next four years. Countrywide currently operates as a subsidiary of Bank of America but does not originate new loans.

"We reached this settlement to resolve issues about Countrywide's alleged historic practices that occurred before Bank of America acquired the company. Bank of America's practices are not at issue," Dan Frahm, a Bank of America Spokesperson said in an emailed statement.

" We are committed to fair and equal treatment of all our customers, and will continue to focus on doing what's right for our customers, clients and communities. We discontinued Countrywide products and practices that were not in keeping with our commitment and will continue to resolve and put behind us the remaining Countrywide issues," he said.

Shares of Bank of America were up 0.8% in the final hour of trading following the news.

--Written by Shanthi Bharatwaj in New York

How the Dow Jones industrial average and other major stock indexes fared on Wednesday

Technology stocks fell Wednesday, dragged down by a weak earnings report from business software maker Oracle Corp. Broad market indexes were flat. The Dow Jones industrial average eked out a gain of 4 points after having been down 104 points at midday. Technology stocks were the issue, with IBM the biggest decliner of the Dow’s 30 stocks. IBM fell 3.1 percent, and Oracle fell 11.7 percent.

The Dow gained 4.16 points, or 0.03 percent, to close at 12,107.74.

The S&P 500 index gained 2.42 points, or 0.19 percent, to 1,243.72.

The Nasdaq composite index fell 25.76, or 1 percent, to 2,577.97.

For the week:

The Dow is up 241.35, or 2 percent.

The S&P 500 index is up 24.06, or 2 percent.

The Nasdaq is up 22.64, or 0.9 percent.

For the year to date:

The Dow is up 530.23 points, or 4.5 percent.

The S&P is down 13.92, or 1.1 percent.

The Nasdaq is down 74.90, or 2.8 percent.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Obama makes Christmas shopping stop at Best Buy

The official White House line is that President Obama is delaying his Christmas trip to Hawaii on the off-chance that House Republicans will act on the payroll tax to his liking.
But even as his press secretary was saying that during the afternoon briefing with reporters on Wednesday, Obama was unwittingly revealing another possible explanation: he hasn't finished buying his Christmas gifts yet.
Yes, after placing a ten-minute call to House Speaker John Boehner over the lunch hour, Obama and his dog Bo hopped into the SUV and went shopping across the river in Alexandria, Va.
The big purchases of the day were iTunes gift cards and video games for his daughters at Best Buy -- including the new Just Dance 3 for the White House Wii.
So much for surprising Malia and Sasha.
"The girls beat me every time on these dance games," he told reporters as he shopped. "But you'll never get a picture of me [playing] because I get graded F every time."
After Del Ray pizza for Obama and a chew toy for Bo, the two headed back to the White House. The Obamas must like the Alexandria shopping plaza where the president went. Michelle Obama was photographed shopping at a Target there earlier this year.
Meanwhile, at the Capitol, Boehner was hoping for another gift -- a change of heart. He told Obama during their call that he wants Democratic and Republican negotiators to reopen the payroll tax cut and come up with a deal that lasts a full year.
The Obama team is adamant. The best "avenue" out of the "cul de sac" the House Republicans have driven into on the issue is to pass the Senate version, Carney said.
A new deal is not on the president's shopping list.

Copyright © 2011, LATimes.com

Turkey angered by French bill to criminalize 'Armenian genocide denial'

Nearly 100 years have elapsed since the killing of thousands of Armenians, but the wounds seem far from healed.

The French parliament is to vote on a bill on Thursday making it illegal to deny that the 1915 killing of Armenians during World War I was genocide. The bill, which is expected to pass, provides for a one-year prison term and a fine of $58,000 (45,000 euros) to anyone who publicly denies it was genocide.

The vote in the French National Assembly has stirred a diplomatic frenzy and French and Turkish politicians are jumping into the fray.

“This proposed law targets and is hostile to the Republic of Turkey, the Turkish nation and the Turkish community living in France,” Tayyip Erdogan, the Turkish Prime Minister wrote in a letter to French President Nicolas Sarkozy, Reuters reports.

During a Saturday news conference, Mr. Erdogan suggested that France ought to investigate her own role and actions in colonial Africa, including Rwanda.

Turkey maintains that the proposed bill is a political ploy by Sarkozy's political party to win the votes of 500,000 Armenians in France ahead of next year’s parliamentary and presidential elections. Sarkozy has also been an outspoken opponent of Turkey desire to join the European Union.

Jean Leonetti, the European Affairs Minister of France, dismisses such allegations and says that opposition Socialists will endorse the bill as well. “It has been nearly 100 years since the Armenian genocide took place, those responsible are dead, it is simply a matter of recognizing a fact of history,” he told Radio Classique, The Telegraph in London reports.

Ersin Onulduran, chairman of the department of international relations at Ankara University, told Today's Zaman, a Turkish daily, that “only historians and archival experts should pass judgment on the merits of historical events.”

Although there is little consensus, Armenians say that about 1.5 million people were killed during the mass deportations of 1915-16.

The Turkish government acknowledges the death of many Armenians, yet, it denies that Ottoman forces deliberately exterminated them. Turkey considers the numbers as inflated and says that Turks were also killed due to the upheaval that followed the disintegration of the Ottoman Empire.

Many Turks, disappointed and disillusioned by European delays over entry into the EU, are now embracing a more assertive rhetoric.

“I want to state clearly that such steps will have grave consequences for future relations between Turkey and France in political, economic, cultural and all areas,” Erdogan said according to Reuters. While Turkey is threatening to boycott French products if the bill passes, it has not ruled out also imposing trade sanctions.

So far this year, bilateral trade between Turkey and France is estimated at more than $13.5 billion. About 1,000 French companies operate in Turkey.

"We have to remember international rules and with regard to Turkey it's a member of the WTO (World Trade Organization) and is linked to the European Union by a customs union and these two commitments mean a non-discriminatory policy towards all companies within the European Union," said French Foreign Ministry spokesman Bernard Valero, Reuters reports.

In 2006, a similar bill was introduced and approved by the French National Assembly but was later dropped by the Senate. In France, any legislative initiative requires the endorsement of both parliament and the Senate to be enacted.

Iraq's Maliki rebuffs Biden, signals move to Shiite rule

BAGHDAD — Rebuffing a plea by the Obama administration, Iraq's Prime Minister Nouri al Maliki signaled Wednesday that he's ready to gradually drop his key partner party, the largely Sunni Iraqiya bloc, and move toward a government run by the country's Shiite majority at the expense of minority Sunnis and Kurds.

At a news conference where he repeatedly emphasized his own powers under the Iraqi constitution and berated his coalition partners, Maliki seemed unconcerned if some Iraqiya members quit the broad coalition, and he spoke at length about the options available to him if they did.

Maliki all but ignored Vice President Joe Biden's expression of U.S. support for an "inclusive partnership government," referring to the broad coalition between Maliki's State of Law bloc and Iraqiya, headed by veteran politician Ayad Allawi.

Biden telephoned Maliki on Tuesday in the midst of a political crisis that erupted over allegations that bodyguards in the employ of Maliki's Sunni vice president, Tareq al Hashemi, had been running assassination squads against public figures.

Maliki also seemed to brush aside Biden's emphasis in the phone call on "the importance of acting in a manner consistent with the rule of law and Iraq's constitution."

Maliki told reporters that justice should take its course against Hashemi, and he said he would not allow the case to be politicized. Nevertheless, he described this as "a very simple case, a criminal case with confessions available," and demanded that Hashemi go before a court and declare his innocence.

He even compared the trial of Hashemi to that of deposed dictator Saddam Hussein. "We provided a fair and clean trial to Saddam, the dictator of Iraq, and we will ensure and be determined to provide a fair trial to Mr. Tareq al Hashemi," he said.

It was the latest turn in the transformation of what might have been simply a judicial process into a trial-by-television. After a panel of judges issued an arrest warrant for Hashemi on Monday, the government aired videotaped "confessions" of arrested members of his security detail implicating Hashemi.

One day later, and in seeming defiance of the arrest warrant, Hashemi held a news conference in Erbil in the semi-autonomous Kurdistan region. His whereabouts were unknown Wednesday, but Maliki, in response to a reporter's question, appealed to the regional government to "hand over" this "wanted man."

Maliki warned that not doing so or allowing him to escape "would cause problems."

Several leading political figures said Maliki could have forged a consensus for dealing with the Hashemi case by calling together all the country's political leaders, presenting them with the evidence, in secret, and seeking their advice.

Instead he decided to go it alone, a decision that immediately took on a sectarian tinge in a country still recovering from a devastating conflict between Sunni and Shiite Muslims. Maliki seemed to take the possible breakup of the current power-sharing arrangement in stride, and he spoke instead of a "new stage" in Iraq.

The Iraqiya bloc boycotted the final session of parliament and announced it was withdrawing ministers from the government as well. But Maliki said that if Iraqiya members did not attend cabinet meetings, he would replace them.

"The former stage required agreements, where we're the pretty face of a (sectarian) quota system," he said, but "in the current stage we are living ... this is a policy which is gone."

One leading expert on Iraqi politics said Maliki was emphasizing his own freedom of action in the wake of the withdrawal of U.S. troops.

Reidar Visser, a Norwegian scholar who runs the website www.historiae.org, said Maliki seemed willing to move now toward a "sectarian alliance of mostly Shiites."

In his prepared remarks, Maliki repeatedly referred to the Iraqi constitution as being the only guide to the organization of government, and at one point he called it the country's "supreme holy document." In so doing, he effectively was repudiating the extra-constitutional deal, supported by the United States at the time, which made him prime minister, even though Allawi won more seats in parliament, Visser said.

"Maliki ... is saying that much of the so-called Erbil agreement about power-sharing is not really in the constitution," Visser said. "He is glad the others gave him the premiership in return for certain promises about power-sharing, and having been granted the premiership, he now intends to ignore what was stipulated about power-sharing at Erbil. Instead he will follow the constitution only."

Visser said he doubted that Maliki would resign as prime minister, which would put the initiative in the hands of President Jalal Talabani, a Kurd, but instead would let the current power-sharing arrangement evolve into a majority government.

"I think how this may work in practice is that he will marginalize Iraqiya and appoint acting ministers if they fail to show up at cabinet meetings," Visser said. "Parliament may become irrelevant or, if Iraqiya withdraws, dominated entirely by the Shiite alliance. Maliki also will rely on a judiciary that is increasingly susceptible to his demands."

Maliki also disclosed that he had reached an agreement with the United Nations under which he'd allow Iranian dissidents who've been living in Iraq since the 1980s to stay beyond his own deadline of Dec. 31. He said the condition was that they move to the former Camp Liberty, which had been a U.S. base at Baghdad's international airport, and that the U.N. move about 800 out of Iraq before the end of the year. U.N. officials said the Mujahidin E Khalq, or MEK, had not yet agreed, and it wasn't clear what will happen if no deal is reached.

(Lesley Clark in Washington and special correspondent Sahar Issa in Baghdad contributed.)

8 U.S. soldiers charged in death of comrade in Afghanistan

KABUL — The Army, which has struggled in recent years to combat a mounting suicide toll, took an unusual step when it announced Wednesday that it had charged eight U.S. soldiers serving in Afghanistan in connection with the apparent suicide of one of their lower-ranking comrades.

The charges in the death of Pvt. Danny Chen, a 19-year-old infantryman from Manhattan, came after a vigorous, weeks-long campaign by advocacy groups and family members hoping to pressure the Pentagon to investigate allegations that Chen had been the subject of hazing within the ranks and repeatedly taunted with racial slurs.

On Oct. 3, Chen was found dead in a guard tower at a small combat outpost in Kandahar province. He was killed by an “apparent self-inflicted gunshot wound,” according to a statement by the NATO command in southern Afghanistan.

While the exact circumstances of his death are still unclear, advocates speaking for the family said on Wednesday that regardless of who fired the bullet that killed him, the soldiers who allegedly mistreated him are responsible.

“Whether suicide or not, the actions of these people led to his death and they must be prosecuted for killing him,” Liz OuYang, a Chinese-American activist who pushed for an investigation into Chen’s death. “There can be no plea bargaining — they must be tried in the death of Danny Chen.”

After more than two months of agonizing over the family’s loss, “it’s of some comfort and relief to learn that the Army is taking this seriously,” said Chen’s mother, Su Zhen Chen, in a Manhattan news conference organized by OuYang. Speaking through an interpreter, she said she hopes that “the truth will come out and that what happened will not be repeated.”

The young soldier’s father, Yen Tao Chen, also said that the military’s action “gives us some hope.”

Military officials declined Wednesday to release documents detailing the charges against the soldiers and did not provide a detailed account of the events that led to Chen’s death. But a spokesman for the Army’s Criminal Investigation Division said that the investigation into how Chen died includes “the circumstances leading up to his death.”

The Army said that 1st Lt. Daniel J. Schwartz, Staff Sgt. Blaine G. Dugas, Staff Sgt. Andrew J. Van Bockel, Sgt. Adam M. Holcomb, Sgt. Jeffrey T. Hurst, Spec. Thomas P. Curtis, Spec. Ryan J. Offutt and Sgt. Travis F. Carden had all been charged with counts ranging from dereliction of duty to making a false statement to assault, negligent homicide and reckless endangerment.

Reached Wednesday, some family members of the accused said they were shocked to hear of the charges.

Sheila Dugas, the mother of Blaine Dugas, said it was “completely out of character” for him. “He was always just taking care of his boys, his troops.”

Bretta Von Bockel, hearing the news about the accusations against her brother for the first time, said she could not believe it. “We worry about him every day,” she said.

Rarely have other service members been charged in connection with a suicide. If Chen did take his own life, he would be the second Asian American known to have done so this year after apparently being mistreated by comrades. Marine Lance Cpl. Harry Lew, 21, shot himself on April 3 after being hazed the night before by fellow Marines, the Marine Corps Times reported.

Through the end of November, the Army reported 154 potential suicides of active-duty service members for this year, slightly ahead of last year’s pace in which 159 active-duty soldiers took their own lives. Suicides in the Army reserves and National Guard have fallen significantly this year.

OuYang, the president of the New York chapter of OCA, an Asian-American advocacy group, said that the case “could have easily been swept under the rug” had it not pushed the Pentagon to act. Three weeks after Chen was found dead, she sent a letter to the Secretary of the Army asking for a meeting to discuss the case and concerns that Asian-American soldiers face discrimination from comrades.

“The community, elected officials and the media demanded the truth,” she said. “That all played an important role in obtaining justice in this case.”

Chen and the accused soldiers were assigned to C Company of the 3rd Battalion, 21st Infantry Regiment, based in Fort Wainwright, Alaska. Sgt. 1st Class Alan G. Davis, a military spokesman, said the accused soldiers have been transferred from their post in Kandahar province to a different military base and relieved of their official duties. He said the soldiers are under “increased supervision” at the new base but are not being detained. Davis said the soldiers will probably be prosecuted in Afghanistan.

Van Bockel, Halcomb, Hurst, Curtis and Offutt were charged with involuntary manslaughter, assault consummated by battery, negligent homicide and reckless endangerment, the military statement said.

Schwartz, the only officer among the defendants, was charged with dereliction of duty. Dugas was charged with dereliction of duty and making a false statement. Carden was charged with assault and maltreatment.

Chen’s death, and the reports that he had been mistreated, incensed Asian American activists in New York, who called on the military to carry out a swift investigation. Hundreds attended a vigil in Manhattan last week to demand answers.

OuYang said Chen, who was born in the United States, had been subjected to ethnic slurs and physical abuse by superiors shortly before he died. Referring to an account military officials provided to the family, she said the physical abuse left marks on his back. Fellow soldiers once forced Chen out of bed and dragged him across the floor to punish him for failing to turn off a water heater, OuYang said. The mistreatment was reported by the New York Times on Oct. 30.

Chen, the son of immigrants who live in New York City’s Chinatown
and speak no English, indicated to his parents that he was being bullied, but also told them that such treatment was “to be expected,” the Times story said.

OuYang said Chen’s diaries and e-mails show a pattern of harassment that began at Fort Benning, Ga., during basic training earlier this year. “He was taunted several days,” she said. “Some of it was ignorance, some of it was outright taunting.”

Reached late Wednesday afternoon by phone, Su Zhen Chen, Chen’s mother said: “We are always missing our son. That’s what’s on our minds.”

S. Korea Lawmakers Slam Government for Failing Over Kim’s Death

(Bloomberg) -- South Korean lawmakers criticized the government for failing to know about North Korean dictator Kim Jong Il’s death until it was announced two days later, putting pressure on intelligence chief Won Sei Hoon to resign.

President Lee Myung Bak’s government first heard about Kim’s Dec. 17 death when it was broadcast on North Korean state television on Dec. 19. Lee attended a party given by his staff to celebrate his birthday, wedding anniversary and election four hours before the announcement.

Won, director of South Korea’s National Intelligence Service, must be held accountable for his ignorance of Kim’s death, lawmakers said today. Lee’s defense minister quit last year amid criticism of the response to a deadly North Korean artillery attack on a South Korean island

“There have been quite a few cases where this government made diplomacy and security appointments regardless of the candidates’ expertise,” Kwon Young Se, a member of the ruling Grand National Party and chairman of the National Assembly’s intelligence committee, told CBS Radio. “Unlike other areas, one mistake in diplomacy and security can threaten the country’s existence.”

Won must resign for his “unacceptable” ignorance and poor management of the agency’s “extraordinary” budget, Park Young Sun, a member of the opposing Liberty Forward Party, said in an interview.

Alert Levels

South Korea responded to Kim’s death and the naming of his son Kim Jong Un as successor by raising the military and civilian cyber alerts one notch above their standard default levels. While the government pledged to stabilize financial markets as needed, stocks and the won rose for a second day, with the benchmark Kospi index up as much as 3.2 percent.

Former South Korean Foreign Minister Han Sung Joo said today in an interview on Bloomberg Television that North Korea is stable and a collapse of the totalitarian state unlikely. Kim Jong Un, thought to be in his late 20’s, is a “figurehead,” while his uncle Jang Song Thaek and military leader Ri Yong Ho are in charge, Han said.

“The situation is pretty much in control,” he said.

The uncertainty on the Korean peninsula comes as public discontent over Lee and his party’s administration of an economy buffeted by inflation and income disparity. The GNP lost the Seoul mayoral race in October and senior lawmakers resigned from their party leadership posts earlier this month, adding to turmoil ahead of parliamentary and presidential elections next year.

--Editors: John Brinsley, Brett Miller

To contact the reporter on this story: Sangwon Yoon in Seoul at syoon32@bloomberg.net

To contact the editor responsible for this story: John Brinsley at jbrinsley@bloomberg.net

Syrian opposition urges U.N. action over 'horrific massacres'

(CNN) -- Syria's major opposition group condemned Bashar al-Assad's regime Wednesday for "horrific massacres" this week and called on the Arab League and the U.N. Security Council to take "necessary measures" to protect civilians.

The Syrian National Council said nearly 250 people have died over a 48-hour period and it urged the Arab League to condemn the killings and work with the United Nations "in taking the necessary measures to protect Syrian civilians."

"The SNC stresses the need to take all necessary actions to stop the bloody campaign that is targeting more cities and towns through the regime's militant expansion," the group said in a news release dated Tuesday but issued Wednesday to CNN via e-mail.

It called for an emergency U.N. Security Council meeting "to discuss the regime's massacres in Zawyiyeh mountain, Idlib, and Homs, in particular; issue international condemnation thereof; declare the cities and towns being brutally attacked 'safe zones' that enjoy international protection; and force the regime's forces to withdraw from said areas."

The group is calling for a declaration "that Zawiyeh mountain, Idlib, and Homs are disaster areas exposed to large-scale genocide and displacement operations by the Syrian regime's militias" and urged the International Red Crescent and other relief organizations "to intervene directly and provide urgent humanitarian assistance."

The violence spiked as Syria agreed to an Arab League peace plan Monday aimed at ending the violence between regime forces and protesters that started in mid-March. The United Nations earlier this month estimated that about 5,000 people have died in the violence.

Other groups also reported a surge in killings this week.

The Local Coordination Committees, an opposition umbrella group, said 84 people were killed across the country Tuesday.

The London-based Syrian Observatory for Human Rights reported a higher death toll of 111, which would make Tuesday among one of the deadliest days since the government crackdown started, activists say.

The Syrian Observatory's Rami Abdul Rahman had said Monday's toll of 100 to 110 was the highest, but Tuesday's total appears to surpass that.

The Syrian government maintains that it is cracking down on armed terrorists who attack security forces and civilians. The activists say the government's brutal crackdown against peaceful protests has led to the deaths.

CNN could not independently verify the allegations because Syria restricts the activity of journalists in the country.

Saad Abedine and Kindah Shair contributed to this report

Walgreen Profit Falls 4.5% on Higher Costs

Walgreen Co.'s fiscal first-quarter earnings fell 4.5% on higher costs as the drugstore chain appeared poised to begin the new year without a contract with Express Scripts Inc.

Shares were down 4.5% at $31.99 in premarket trading as earnings missed expectations. Through Tuesday's close, the stock is down 14% this year.

A conflict between Walgreen and the pharmacy-benefits manager over new contract terms erupted publicly in June, when Walgreen said it wouldn't be part of Express Scripts's network when their current deal expires after this year.

A Walgreen exit from Express Scripts's network would mean the benefit manager's clients would have to go elsewhere to fill prescriptions. However, based on current estimates and the assumption that it won't be in the Express Scripts network in 2012, Walgreen said it expects to achieve 97% to 99% of its fiscal 2011 prescription volume.

For the latest quarter, Walgreen said its decision to exit Express Scripts cost a penny per share in comparable pharmacy sales and a penny a share in related expenses.

President and Chief Executive Greg Wasson said "While we remain open to any fair and competitive offer from Express Scripts, we firmly believe that accepting their proposal was not in the best long-term interests of our shareholders." As a result, Walgreen has started to execute plans to reach cost-reduction goals for operating without Express Scripts, Mr. Wasson said.

For the quarter ended Nov. 30, Walgreen reported a profit of $554 million, or 63 cents a share, from $580 million, or 62 cents a share, a year earlier.

The latest period included inventory-related charges of $5 million, while the prior year included $42 million.

Analysts polled by Thomson Reuters most recently forecast earnings of 67 cents.

Gross margin fell to 28.1% from 28.5% on weaker pharmacy margins caused by reduced reimbursement rates. Overhead expenses were up 5% including 0.8 percentage point related to the integration of its drugstore.com acquisition.

Walgreen recently reported that total sales were up 4.7% at $18.16 billion, below analysts' expectations at the time. Same-store sales rose 2.5%, including growth of 2.4% in the pharmacy and 2.5% in the front of the store.

Write to Tess Stynes at tess.stynes@dowjones.com

Copyright 2011 Dow Jones & Company, Inc. All Rights Reserved

Egyptians vote in parliamentary election runoffs amid growing uncertainty over nation’s future

CAIRO — Voting in election runoffs for Egypt’s first parliament since Hosni Mubarak’s ouster resumed on Wednesday without the long lines outside polling centers seen in previous rounds of the staggered vote.

The balloting comes amid growing calls for the ruling military to step down and allow the next parliament to form a national unity government that would take over the reins of power until a new president is elected before the end of June. Another scenario being floated is for presidential elections to be brought forward to January and a handover of power to take place the following moth.

The proposals, which the military has yet to comment on, are being floated as the generals who took over after a popular uprising forced Mubarak to step down 10 months ago are coming under growing criticism for mismanaging the transition period, gross human rights abuses and failure to revive the economy or restore security.

“I know nothing about politics, but I want stability for my country,” said Fatmah Morsi as she was about to cast her ballot in Dokki, a middle-class neighborhood in Cairo. “Enough with the protests. we should give this government a chance.”

The balloting, which is taking place Wednesday and Thursday, is in the second round of the election, with voting in mostly rural areas. A third and final round is to be held in early January. The new parliament is not scheduled to be seated until March, after three rounds of voting for the legislature’s largely toothless upper chamber is also completed.

Islamists led by the Muslim Brotherhood, the country’s largest and best organized political group, have dominated the vote thus far and are likely to maintain their comfortable lead.

The brutality shown by the troops to protesters calling for the country’s military rulers to immediately step down has caused an uproar in Egypt. On Tuesday, some 10,000 women marched in central Cairo, demanding the military step down and expressing their anger over the abuse of women protesters by troops during the crackdown.

The military issued a statement expressing its regret but did not apologize for the brutality, which included pulling women by their hair, beating them with truncheons and stomping on them as they lay on the ground. The image of one woman — stripped half naked by the troops, kicked and stomped on — has particularly enraged women and drawn a sharp rebuke from the United States and the United Nations.

A women-only protest is a rarity in Egypt, though tens of thousands of women took part in the wave of protests that engulfed Egypt during the 18-day, January-February uprising that toppled Mubarak. The high number of protesters Tuesday underlined the depth of anger at the abuse of women by the soldiers. Women’s modesty in public is a cornerstone of social customs in conservative Egypt.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Asia Stocks Rise Second Day on U.S. Data, China Industry Support

(Bloomberg) -- Asian stocks rose for a second day, with a benchmark index set for the biggest gain in almost three weeks, as China pledged support for exporters and small businesses and after improved U.S. and German economic data.

Honda Motor Co., the Japanese carmaker that gets about 44 percent of its sales from North America, advanced 2.4 percent in Tokyo on speculation shipments will rise amid signs the U.S. economy is improving. Onesteel Ltd., the second-worst performer in the MSCI Asia Pacific Index this year, jumped 7.1 percent after Goldman Sachs Group Inc. named it among top Australian stock picks for next year. Mining and energy stocks gained as oil and copper prices climbed.

“The U.S. is showing it's fairly robust in terms of not being dragged down to the extent of European economies,” said Tim Schroeders, who helps manage $1 billion in equities at Pengana Capital Ltd. in Melbourne. “The question is, given we are coming into a holiday period, how sustainable those gains are going to be over the next week or so.”

The MSCI Asia Pacific Index advanced 2.2 percent to 113.38 as of 8:02 p.m. in Tokyo, with almost nine shares rising for each that fell. The gauge dropped to a three-week low on Dec. 19 after North Korean leader Kim Jong Il died and Fitch Ratings said it may cut the credit ratings of European nations.

Trading volumes were below the 30-day average for all major markets in the region except India, according to data compiled by Bloomberg.

Japan's Nikkei 225 Stock Average increased 1.5 percent, while South Korea's Kospi Index jumped 3.1 percent. Australia's S&P/ASX 200 rose 2.1 percent. Hong Kong's Hang Seng Index gained 1.9 percent.

U.S. Rebound

The Hang Seng China Enterprises Index added 2.2 percent after Premier Wen Jiabao pledged to provide capital support for small and medium-sized companies affected by the nation's slowing economic growth. The Shanghai Composite Index slipped 1.1 percent, erasing gains of as much as 1 percent.

Futures on the Standard & Poor's 500 Index rose 0.4 percent today. The index advanced 3 percent in New York yesterday after housing starts in November rose to the most since April 2010 and payrolls increased in 29 states.

Shares of Asian exporters advanced. Honda gained 2.4 percent to 2,325 yen. Samsung Electronics Co., South Korea's biggest exporter of devices such as mobile phones and semiconductors, climbed 4.5 percent to 1.057 million won in Seoul. James Hardie Industries SE, a maker of building materials that counts the U.S. as its biggest market, added 1.8 percent to A$6.66.

Shipping Alliance

Stocks also gained as concern about Europe's debt crisis eased after Spain sold 5.64 billion euros ($7.38 billion) of bills, more than the maximum target, and German business confidence unexpectedly grew.

Shipping stocks advanced on speculation a new alliance formed by Mitsui O.S.K. Lines Ltd., Hyundai Merchant Marine Co., Neptune Orient Lines Ltd. and three other lines on the Asia- Europe trade route will help stem a decline in rates.

Mitsui O.S.K., Japan's second-biggest freight carrier by sales, increased 1.8 percent to 288 yen in Tokyo. Hyundai Merchant Marine, South Korea's No. 2, jumped 4.5 percent to 25,400 won in Seoul. Neptune Orient Lines Ltd, Southeast Asia's largest container carrier, gained 3.6 percent to S$1.15.

Worst Performers

The MSCI Asia Pacific Index slumped 19 percent this year year through yesterday. Utilities were the worst performing industry in the gauge as Japan's nuclear-power producers tumbled after the worst nuclear accident in 25 years engulfed Tokyo Electric Power Co.'s Fukushima Dai-Ichi plant. Tepco, as the utility is known, is the worst performer on the gauge, followed by OneSteel, Australia's second-biggest producer of the metal.

OneSteel, which tumbled 75 percent this year through yesterday, increased 7.1 percent to 68 Australian cents. Goldman Sachs recommended investors “buy” the stock, saying the company may benefit from a potential loosening of monetary policy in China.

The Asia-Pacific index's drop this year compared with a 1.3 percent decline by the S&P 500 and a 14 percent slide by the Stoxx Europe 600 Index. Stocks in the Asian benchmark are valued at 12.4 times estimated earnings on average, compared with 12.6 times for the S&P 500 and 10.4 times for the Stoxx 600.

Commodity Stocks

Raw-material producers and energy companies advanced today after commodity prices rallied on the improving outlook for the U.S. and Europe and after Wen's pledge of support for Chinese producers. China is the world's biggest consumer of copper.

BHP Billiton Ltd., which counts China's as its No. 1 market, climbed 3 percent to A$35.13. Jiangxi Copper Co., China's biggest producer of the metal, rose 1.9 percent to HK$16.84 in Hong Kong.

Among stocks that dropped, Tepco sank 9.8 percent to 211 yen in Tokyo. The utility may be effectively nationalized, the Yomiuri newspaper reported, citing an unidentified person familiar with the plan. The company denied the report.

Motorola violated Microsoft patent, rules judge

The International Trade Commission has ruled that Motorola Mobility has violated six of Microsoft's smartphone patents, in a decision claimed as a victory by both companies.

The patent concerned is one of seven Windows Phone and Windows Mobile patents which Microsoft claimed was being infringed. US Patent No. 6,370,566 covers 'generating meeting requests and group scheduling from a mobile device'. Offending handsets include the Droid 2, Droid X, Cliq XT, Devour and Backflip.

In the event, the Administrative Law Judge (ALJ) ruled that the other six patents weren't being violated.

"We are very pleased that the majority of the rulings were favorable to Motorola Mobility," says Scott Offer, senior vice president and general counsel of Motorola Mobility.

"The ALJ’s initial determination may provide clarity on the definition of the Microsoft 566 patent for which a violation was found and will help us avoid infringement of this patent in the US market."

However, the patent that was upheld appears to cover the ability to schedule meeting requests from mobile devices - a pretty basic feature for business users in particular.

"If they're on travel or even just at lunch or in a meeting room, they want to be able to schedule meetings without having to go back to their office. Scheduling meetings is also increasingly popular on some social networks, so it's probably a feature for both enterprise users and consumers," says patent expert Florian Mueller.

"It remains to be seen how Motorola will address this issue as well as any other Android patent issues that will present themselves along the way, with many other cases and dozens of other patents still waiting for a decision."

With Motorola Mobility already in Google's shopping cart, the search giant must be worried. it's buying Motorola Mobility specifically to protect Android vendors from patent lawsuits such as this.

Holiday showdown over payroll tax tests Obama, GOP

WASHINGTON (AP) — Stuck in a stalemate, President Barack Obama and his Republican rivals are slugging it out in Washington rather than reaching for a holiday season accord to prevent payroll taxes from going up on 160 million workers.

The tax increases, as well as cuts to Medicare doctors' fees and a lapse in jobless benefits, are due Jan. 1. They are looming even though the combatants agree that they shouldn't happen. Instead, the warring factions have painted themselves into a corner.

House Republicans are demanding that the Senate join negotiations to produce an agreement within days; Senate Democrats insist no talks will take place before the House approves a stopgap measure to buy more time.

A House vote Tuesday scuttled a bipartisan Senate deal for a two-month extension of all three policies: the payroll tax cuts, jobless benefits and Medicare fees.

After the House killed the Senate measure on a 229-193 vote, Obama signaled he'll use his presidential megaphone to try to force Republicans controlling the House into submission.

"Now let's be clear," Obama said at the White House. "The bipartisan compromise that was reached on Saturday is the only viable way to prevent a tax hike on Jan. 1. The only one."

The Obama campaign promptly took to Twitter and Facebook to fight it out. With their candidate's poll numbers rising, Democratic operatives seemed almost giddy at the prospect of a prolonged battle.

"The response was overwhelming," said a White House official requiring anonymity to discuss Obama's political efforts.

Republican lawmakers relished the battle as well, though some of them are too inexperienced to know that presidents — regardless of party — usually win such high-profile fights, like President Bill Clinton did over a 1995-96 government shutdown or President George W. Bush did in skirmishes on anti-terror policies.

House Republicans instead rallied around a plan passed last week that would have extended the payroll tax cut for one year. But that version also contained spending cuts opposed by Democrats and tighter rules for jobless benefits.

If legislation isn't passed by New Year's Day, payroll taxes will go up by almost $20 a week for a worker making a $50,000 salary. Almost 2 million people could lose unemployment benefits as well, and doctors would bear big cuts in Medicare payments.

Whatever the stakes, there was little indication that Republicans would get their wish for negotiations with the Senate any time soon. Senate Majority Leader Harry Reid, D-Nev., issued a statement saying he would be happy to resume talks on a yearlong measure — "but not before" the House ratifies the two-month bill and sends it to Obama for his signature.

Given Obama's remarks and Reid's refusal to negotiate, it was unclear what leverage Republicans had in the year-end standoff. It appeared likely the partisan disagreement could easily persist past Christmas and into the final week of the year.

A little-noticed element of the brawl was that the House-Senate parliamentary situation, which can be a critical factor, is all messed up. The Senate adjourned Saturday until Jan. 23 except for so-called pro forma sessions in which legislative business — like responding to the House moves — is basically impossible unless all 100 senators agree. That's never a sure thing.

The standoff was sowing confusion among business executives, who were running out of time to adapt to any new payroll tax regimen. Even the Senate's proposed two-month extension was creating headaches because it contained a two-tiered system geared to ensuring that higher-income earners paid a higher rate on some of their wages, according to a trade group.

"There's not time enough to do that in an orderly fashion," said Pete A. Isberg, president of the National Payroll Reporting Consortium trade group. "We're two weeks away from 2012." He wrote a letter to congressional leaders this week warning that the Senate bill "could create substantial problems, confusion and costs."

Meanwhile, Medicare announced Tuesday that, as it has in the past when doctors' reimbursements have been cut through congressional inaction, it would withhold physicians' payments for two weeks in January to avoid passing on a 27 percent cut in Medicare fees. The hope is that the problem gets fixed by then.

Copyright © 2011 The Associated Press. All rights reserved.

Feud between Romney, Gingrich intensifies

OSKALOOSA, Iowa — The slugfest between Republican presidential frontrunners Mitt Romney and Newt Gingrich is escalating, with two sparred from a distance over attack ads that have come to dominate the volatile contest.

The rift underscores the contrasting campaign styles of the two men as they ready their final pitches to voters in Iowa and New Hampshire. And it left each decrying a new campaign finance system — fueled by deep-pocketed political action committees — that each benefits from.

In Iowa, Gingrich vowed his White House bid would remain positive, while in the next breath he labeled the Romney camp's tactics "disgusting." The former House speaker, known for a bare-knuckles campaign style when he engineered the GOP takeover of the House in the 1990s, suggested at a campaign stop on Tuesday that his opponents "hire consultants who get drunk, sit around and write stupid ads."

Romney protested that he couldn't control the independent PAC expenditures, but pointedly declined to disavow the ads. The former businessman and Massachusetts governor, who's been on the stump in New Hampshire, is seeking to project a tough, pragmatic image, allowing there's "no whining in politics."

"I'm a big boy," he said on MSNBC.

Meanwhile, Ron Paul has emerged as a wild card in the race. The blunt-spoken Texas congressman is set to hit the trail in Iowa again on Wednesday, along with other candidates in the field. With less than two weeks to go until the first-in-the nation Iowa caucuses, the race remains unpredictable, as voters weigh electability against conservative credentials.

Jenny Turner, a 31-year-old wedding videographer from Mount Pleasant, Iowa, summed it up this way: "My heart is with Newt. But Mitt Romney is the back of my mind."

The bickering over negative ads has highlighted the role of so-called super PACs, independent groups which may accept unlimited donations but are not supposed to directly coordinate with candidates. Such groups have sprung up to work on behalf of every serious Republican candidate in the wake of a U.S. Supreme Court decision last year that allowed people, unions and corporations to donate unlimited sums of money to outfits advocating the election or defeat of candidates.

Romney has labeled the system a "disaster"; Gingrich calls it "a nightmare."

Still, each has PACs leveraging dollars on their behalf.

Among the most visible is the pro-Romney PAC Restore our Future, run by former Romney aides. It has been blanketing the airwaves in Iowa with a series of caustic ads painting Gingrich as an ethically-challenged Washington power broker. The onslaught has chipped away at Gingrich's poll numbers in the state

Gingrich has challenged Romney to demand the ads come down.

However, two pro-Gingrich PACs have also been raking in cash. Gingrich's longtime aide Rick Tyler just signed on with one of them.

Gingrich trails Romney badly in fundraising and his campaign had been deeply in debt following staff upheaval earlier this year. The PAC spending could help him rapidly make up that gap. Gingrich said Wednesday he would disavow any PAC that runs negative ads, but that doesn't mean they could not do so anyway.

Gingrich and Romney were each expected back on the campaign trail Wednesday, one of the last full days before the campaigns go dark for the holidays. Romney had a full day of campaign stops in New Hampshire, a must-win state for him. He was set to pick up the endorsement of a key conservative activist.

Gingrich was collecting the support from state House speakers in Iowa and New Hampshire and was set to hold events in both states. He was then set to rush to Virginia, which the former Georgia congressman now calls home, to help ensure he has the needed signatures to get on the ballot in the state.


Copyright 2011, The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Death toll from Philippine flash floods tops 1,000

ILIGAN, Philippines (AP) – The official death toll from last week's massive flash flooding in two southern Philippine cities topped 1,000 on Wednesday, while authorities said they lost count of how many more were missing in one of the worst calamities to hit the coastal region.

Soldiers carry coffins of flash flood victims during a mass burial Tuesday at a cemetery in Iligan.

The latest tally showed a total of 1,002 people have been confirmed dead, including 650 in Cagayan de Oro and an additional 283 in nearby Iligan city, said Benito Ramos, head of the Civil Defense Office. The rest came from several other southern and central provinces.

A tropical storm swept through the area Friday night and unleashed flash floods in the middle of the night that caught most of the victims in their sleep.

"There were many lessons learned by the people who did not listen to national and local governments, but this is not the time to put the blame on them," Ramos told The Associated Press, adding that warnings by weather forecasters of an approaching storm went unheeded.

He said the government continues to be focused on retrieving the bodies, most of which are being pulled from the sea off Cagayan de Oro.

"We've lost count of the missing," he said.

President Benigno Aquino III declared a state of national calamity during a visit to the region Tuesday and promised the government "will do its best to prevent a repeat of this tragedy."

He said there would be an assessment of why so many people died and why those living along riverbanks and close to the coast — most of them illegal settlers — had not been moved to safety.

"I do not accept that everything had been done. I know that we can do more. We must determine what really happened," Aquino said. "Must this end in tragedy? We knew that (storm) was coming. There should have been efforts to avoid the destruction."

Illegal logging is another factor believed to have contributed to the staggering death toll as many victims were swept away by huge logs that rolled down denuded mountains facing the two cities. Experts say unmitigated logging and deforestation contribute to soil erosion and trigger mudslides.

Aquino declared a ban on logging in February but weak law enforcement and corruption makes it a recurring problem.

With a handful of funeral parlors overwhelmed in Iligan and Cagayan de Oro, authorities and grieving relatives have begun burying the dead.

People wept during funeral rites at the Iligan city cemetery, where soldiers carried the caskets of at least 38 victims Tuesday. Many wore masks to try to block the stench of decomposing bodies.

"We have to give the dead a decent burial," Mayor Lawrence Cruz said. He said authorities were using part of the cemetery's passageway to build tombs.

More burials were planned for Wednesday, including of unclaimed remains after they are processed by government forensic teams for future identification.

About 45,000 displaced were still crowded in evacuation centers as aid workers rushed in relief supplies. Lack of running water was a major concern.

Analiza Osado grabbed her three young children and headed for the door when floodwaters reached her bed and quickly rose chest-high. She is one of many survivors living in Iligan's biggest gymnasium.

"We have enough food and water here but we don't have clothes," she said. "Everything is gone."

With half of her house swept away, she said she was stopped by authorities from returning to her village near the sea and the mouth of the river that overflowed.

Among many aid agencies operating in the region, UNICEF launched an appeal for $4.2 million to assist the victims and dispatched water bladders, hygiene kits, temporary pit latrines and mobile water units.
Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Biden urges Iraq leaders to resolve sectarian disputes

US Vice-President Joe Biden has urged Iraqi leaders to work together to avert renewed sectarian strife.

The White House said Mr Biden had expressed his concerns in a phone call to Shia Prime Minister Nouri Maliki.

It comes after an arrest warrant was issued for Iraq's Sunni Vice-President, Tariq al-Hashemi, on terror charges.

That sparked fears that Iraq's fragile year-old unity government could fall apart, shortly after the last US soldiers left the country.

Fighting between Sunnis and Shia left thousands dead in the tit-for-tat attacks of 2006-2007.

The entire al-Iraqiyya Sunni political bloc is boycotting parliament and the cabinet in protest at the warrant, while the Sunni Deputy Prime Minister Saleh al-Mutlak has said Iraq is facing "chaos and disaster".

Mr Hashemi, who is now in Iraq's semi-autonomous northern Kurdistan Region, has denied any wrongdoing.

Barely had the last American soldier stepped across the border into Kuwait than the fragile Iraqi political structure the US military left behind began to fall dangerously apart, as long-standing tensions between Shia and Sunni political leaders came to a head.

The most dramatic symptom of the exploding crisis is the fact that Iraq's most senior Sunni Arab politician, Tariq al-Hashemi, is effectively a fugitive. While he hides out under Kurdish protection in the north, the entire al-Iraqiyya political bloc to which he belongs has pulled out of both parliament and the cabinet.

That paralyses Sunni participation in the hard-won power-sharing deal that underpins a year-old national unity government which has rarely pulled together. Frantic efforts are now under way to try to hold that structure together.

The alternative, at its direst, could be the country's de facto partition, as part of a wider regional Balkanisation along sectarian lines.
Rift endangers unity government
'I blame Maliki'

In a statement, the White House said Mr Biden had spoken separately with Mr Maliki and parliamentary Speaker Osama al-Nujaifi to discuss the political situation and to stress Washington's "commitment to a long-term strategic partnership with Iraq".

He told them of the importance of an inclusive government and of "acting in a manner consistent with the rule of law and Iraq's constitution".

"The vice-president also stressed the urgent need for the prime minister and the leaders of the other major blocs to meet and work through their differences together," the statement said.

The last US troops left Iraq on Sunday, eight years after the invasion that toppled Saddam Hussein.

The next day, Iraq's interior ministry announced that an arrest warrant had been issued for Mr Hashemi. It said members of his security detail had confessed to carrying out terror attacks.

State-run television broadcast what were said to be the men's confessions.

Mr Hashemi has said the accusations are "fabricated". He has accused Mr Maliki of being behind a plot to discredit him and blow apart recent attempts at national reconciliation.

"All the efforts that have been exerted to reach national reconciliation and to unite Iraq are now gone. So yes, I blame Maliki," he said.

Mr Hashemi said he was ready to defend himself against accusations of terrorism

In response to the warrant, the main Sunni Arab political bloc al-Iraqiyya - which was already boycotting parliament in protest at Mr Maliki's alleged authoritarian manner - said its ministers would suspend participation in cabinet.

Mr Mutlak said said the Sunni minority was "being oppressed" by Mr Maliki's Shia-dominated government and his "unwise running of the country", and has called for a confidence vote in parliament.

He said Iraq risked descending into renewed sectarian conflict.

Iraq's power-sharing government was formed a year ago after nine-months of negotiations which followed inconclusive election results.

But the BBC's Middle East correspondent Jim Muir say the government has rarely pulled together, and a gulf of mistrust remains between the two sides.

Kurdistan President Masoud Barzani, who brokered the deal, has warned it is now in danger of collapsing.

Egypt: 10,000 march in protest at woman dragged half-naked through street

Tuesday's dramatic protest, which grew as the women marched from Tahrir Square through downtown, was fueled by the widely circulated images of abuses of women. Many of the marchers touted the photo of the young woman whose clothes were partially pulled off by troops, baring her down to her blue bra, as she struggled on the ground.

"Tantawi stripped your women naked, come join us," the crowd chanted to passers-by, referring to Field Marshal Hussein Tantawi, the head of the military council that has ruled Egypt since the Feb. 11 fall of Hosni Mubarak. "The daughters of Egypt are a red line," they chanted.

Even before the protest was over, the military council issued an unusually strong statement of regret for what it called "violations" against women - a quick turnaround after days of dismissing the significance of the abuse.

The council expressed "deep regret to the great women of Egypt" and affirmed "its respect and total appreciation" for women and their right to protest and take part in political life. It promised it was taking measures to punish those responsible for violations.

The statement suggested the military's fear that attacks on women could wreck its prestige at home and abroad, which has already been heavily eroded by its fierce, five-day-old crackdown on pro-democracy protesters demanding it surrender power. The ruling generals have campaigned to keep the public on its side in the confrontation, depicting the activists as hooligans and themselves as the honorable protectors of the nation, above reproach.

In unusually harsh words, US Secretary of State Hillary Rodham Clinton on Monday accused the Egyptian security forces and extremists of specifically targeting women.

"This systematic degradation of Egyptian women dishonors the revolution, disgraces the state and its uniform, and is not worthy of a great people," she said.

In a possibly significant hint of new flexibility, the council also said in its statement Tuesday that it was prepared to discuss any initiatives to help the security of the country. In recent days, a number of political factions have pressed the military to hand over power by February, rather than June, when it promised to hold presidential elections.

In the past, police in Mubarak's regime were accused of intentionally humiliating women in protest crackdowns. But images of women being abused by soldiers were particularly shocking in a society that is deeply conservative and generally reveres the military. The independent press has splashed its front pages with pictures of soldiers chasing women protesters, including ones in conservative headscarves and full face-veils, beating them with sticks and clubs and dragging them by their hair. The crackdown has left 14 people dead - all but one by gunshots - and hundreds wounded.

The images of the half-stripped protester, whose identity is not known, clearly had a powerful resonance. A banner showing a photo of her on the asphalt - one soldier yanking up her black robes and shirt, another poised to stomp on her chest - was put up in Tahrir Square for passing drivers to see.

"The girl dragged around is just like my daughter," said Um Hossam, a 54-year old woman in traditional black dress and a headscarf at Tuesday's march. "I am a free woman, and attacking this woman or killing protesters is just like going after one of my own children."

Ringed by a protective chain of men, the women marched from Tahrir to the Journalists' Syndicate, several blocks away, chanting slogans demanding the military council step down.

Many accused the military of intentionally targeting women to scare them and their male relatives from joining protests against the generals. Previously, the military has implied women who joined protests were of loose morals. In March, soldiers subjected detained female protesters to humiliating tests to determine if they were virgins.

"They are trying to break women's spirits, starting with the virginity tests. They want to break their dignity so that they don't go out and protest," Maha Abdel-Nasser, an engineer who joined the march, said.

Two sisters, Yomna and Tasneem Shams, said they never took part in previous protests because their parents wouldn't allow them. But they happened to be downtown Tuesday and spontaneously joined the women's march.

"No one should ever be beaten for expressing their opinion," Yomna, 19, said. "I am proud I took part in today's protest. I feel I can tell my kids I have done something for them in the future."

Some also criticised Islamic parties, which stayed out of the antimilitary protests and did not participate in Tuesday's march - even though religious conservatives often tout their defense of "women's honor." Pro-democracy activists accused them of being worried about anything that might derail ongoing, multistage parliamentary elections, which the fundamentalist Muslim Brotherhood and the more conservative Al-Nour Party have dominated so far.

"This is a case of honour. But they clearly don't care for honor or religion. They now care only about their political interests," said Mohammed Fawaz, one of the men in the protective chain around the marching women.

The protest also is likely to deepen the predicament of the military as critics began to talk openly about putting them on trial for abuses, and politicians are floating ideas for their exit, perhaps in return for immunity.

Emad Gad, a newly elected lawmaker, said that without guarantees they would not be prosecuted, the generals won't hand over power by the end of June as promised. Foremost on their minds, he said, was the fate of Mubarak, who ended in court facing charges that carry the death penalty after ruling Egypt for nearly 30 years.

"They didn't get clear assurances and that is why they try diabolical tactics to make sure they get these guarantees," he said, citing the military's attempt to enshrine in the next constitution language that would shield it from civilian scrutiny.

"We have to address their fears, their interests and future role," he said.

The public and many activists welcomed the military when it took power from Mubarak in February. But relations have deteriorated sharply since as the democracy activists accused the generals of hijacking their uprising, obstructing reforms, human rights abuses and failing to revive the ailing economy or restore security.

The most recent protests - and an earlier round of protests that saw a deadly crackdown last month - have seen unprecedentedly bold ridiculing of the military, which for decades was considered a revered institution above criticism. Young protesters have heaped profanities into their antimilitary slogans, demanded the execution of Tantawi and taunted soldiers in Tahrir.

On Monday, a member of the military council, Maj. Gen. Adel Emara, took a hard-line in a press conference, denouncing the protests as a conspiracy to "topple the state" and accusing the media of fomenting sedition.

He defended the use of force by troops, saying they had a duty to defend the state's institutions and declined to offer an apology for brutality toward female protesters. He did not dispute the authenticity of the image of the woman being dragged half naked by soldiers, but said Egyptians should not see it without considering the circumstances surrounding the incident.

The apparent change in attitude with Tuesday's statement of regret left some women unimpressed.

Sahar Abdel-Mohsen, a 31-year old activist, doubted the promise to punish those responsible and said the statement was in response to the US criticism. "This is an apology to one woman, Hillary Clinton."

"This is like someone raping a girl, and then going to the police station to marry her (to avoid prosecution) and then divorce her as soon as he leaves," she said. "It is an attempt to exonerate themselves after the deed is done, but with little accountability."