Euro falls as German, French economies disappoint

LONDON (Reuters) - The euro dropped and European shares fell on Thursday as growth data from the region's two largest economies came in weaker than forecast, throwing a first quarter recovery for the bloc into doubt.


The German economy, Europe's largest, contracted by 0.6 percent in the final quarter of 2012, marking its worst performance since the global financial crisis was raging in 2009.


Worryingly for Berlin, it was export performance - the motor of its economy - that did most of the damage. France's 0.3 percent fall was also a touch worse than expectations.


The figures suggest the euro zone could remain slumped in recession in the first quarter of this year and pushed down the euro 0.5 percent to a session low $1.3382.


"This is major data, so it's dampening sentiment," said Anita Paluch, sales trader at Gekko Capital Markets.


"It is kind of disappointing that Germany, which had shown so much resilience, is now showing signs of suffering from the debt crisis."


Stock markets also edged lower although the impact was not so marked. The pan-European ESTOXX 50 index <.stoxx50e> was down 0.1 percent by 0815 GMT with London's FTSE 100 <.ftse>, Paris's CAC-40 <.fchi> and Frankfurt's DAX <.gdaxi> all down by a similar amount.


German bonds were steady, stabilizing after a fall in the previous session as demand for traditional safe-haven assets returned.


Benchmark Bund futures were 3 ticks higher on the day at 142.08, with analysts targeting a further rise if the remaining GDP data for countries such as Italy (0900 GMT), and the euro zone as a whole (1000 GMT), also come in weak.


The pain is not confined to Europe. Japan, under some pressure over its aggressive monetary and fiscal policies which are driving down the yen, came up with an unwanted riposte earlier on Thursday - its GDP shrank 0.1 percent in the fourth quarter, leaving it in recession and crushing expectations of a modest return to growth.


The Bank of Japan also kept monetary policy steady and upgraded its economic assessment, as recent falls in the yen and signs of a pick-up in global growth in recent months give it some breathing space after expanding stimulus just a month ago.


Markets in China and Taiwan remain shut for the Lunar New Year holiday but Hong Kong resumed trading on Thursday.


(Reporting by Marc Jones; Editing by Peter Graff)



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Pistorius charged with murder of girlfriend


PRETORIA, South Africa (AP) — Oscar Pistorius has been charged with the murder of his girlfriend after model Reeva Steenkamp was shot inside the Olympic athlete's home in South Africa.


Police said a 26-year-old male would appear in court later on Thursday. Police in South Africa do not name suspects in crimes until they have appeared in court but police spokesperson Brigadier Denise Beukes said that Pistorius was at his home after the death of Steenkamp and "there is no other suspect involved."


Beukes said the suspect was undergoing blood alcohol and forensic tests and had made a request to be brought to court immediately. Beukes said he would apply for bail, but the South African Police Service would oppose the application.


Beukes said there had been "previous incidents" at Pistorius' home.


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Where's Obama's foreign policy?








By Isobel Coleman, Special to CNN


February 13, 2013 -- Updated 1653 GMT (0053 HKT)









STORY HIGHLIGHTS


  • Isobel Coleman: Obama mainly addressed domestic issues: economy, immigration, energy

  • He spoke very little about and offered nothing much new on foreign policy, she says

  • Coleman: He talked about ending Afghanistan War, spoke briefly about Iran, Syria, China

  • Coleman: His reinvigorated free trade agenda seems to be the boldest move




Editor's note: Isobel Coleman is the author of "Paradise Beneath Her Feet" and a senior fellow for U.S. foreign policy at the Council on Foreign Relations in New York.


(CNN) -- President Obama's State of the Union address predictably focused on his domestic priorities.


Immigration reform, a laundry list of economic initiatives including infrastructure improvements (Fix it First), clean energy, some manufacturing innovation, a bit of educational reform and the rhetorical high point of his speech -- gun control.



Isobel Coleman

Isobel Coleman



As in years past, foreign policy made up only about 15% of the speech, but even within that usual limited attention, Tuesday night's address pointed to few new directions.



On Afghanistan -- America's longest war -- Obama expressed just a continued commitment to bringing the troops home, ending "our war" while theirs continues. On Iran, there was a single sentence reiterating the need for a diplomatic solution, which makes me think that a big diplomatic push is not likely. On North Korea, boilerplate promises to isolate the country further after its provocative nuclear test, and on Syria, a call to "keep the pressure" on the regime, which means more watching from the sidelines as the horror unfolds.


Notably, China was mentioned only twice -- once in the context of jobs, and another time with respect to clean energy. Nothing about managing what could very well be this administration's most vexing but critically important bilateral relationship.


Obama's call for a reinvigorated free trade agenda was his boldest foreign policy statement of the evening. He is right to note that free trade "supports millions of good-paying American jobs," but his pledge to pursue a "comprehensive Transatlantic Trade and Investment Partnership" -- a free trade agreement with Europe -- will run into significant opposition from organized labor, especially given ongoing weaknesses in the economy.






Without fast track negotiating authority, the prospects for such a deal are minimal. Fast track authority, which allows the president to negotiate trade deals that Congress can then only approve or disapprove but not amend, expired in 2007, and it would require quite a breakthrough for Congress to approve it again. Still, despite these challenges, an agreement is worth pursuing.


Aside from a free trade agreement with Europe, there was little else in this State of the Union that hinted at foreign policy ambition. But unpredictable events have a way of derailing America's best laid plans to stay above the fray of the world's messiest problems. Who could have predicted just a few months ago that Mali would get a mention in the State of the Union? Iraq -- not uttered once tonight -- could re-emerge as a formidable crisis; Iran, Pakistan and North Korea also have tremendous potential to erupt.


While this administration seems determined to focus inward on getting America's economic and fiscal house in order, I doubt events in the rest of the world will be so accommodating.


Follow @CNNOpinion on Twitter.


Join us at Facebook/CNNOpinion.


The opinions expressed in this commentary are solely those of Isobel Coleman











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Anxiety grows as Chicago Public Schools narrows closing list









After trimming the number of schools that could be closed to 129, Mayor Rahm Emanuel's school administration on Wednesday entered the latest and what is likely to be the most intense phase so far in trying to determine which schools should be shut.


Chicago Public Schools chief Barbara Byrd-Bennett is expected to pare the preliminary list before unveiling a final one at the end of March. She said administrators will determine which schools are saved in the coming weeks amid a final round of community meetings to hear arguments from parents, teachers and community groups about why their schools should stay open.


If a hearing Wednesday night in North Lawndale was any indication, CPS still has a long way to go to gain the public's trust.





"Our schools don't need to close," Dwayne Truss, vice chairman of CPS' Austin Community Action Council, said in front of hundreds of people packed inside a church auditorium in the West Side neighborhood. "CPS is perpetrating a myth that there's a budget crisis."


CPS initially said 330 of its schools are underenrolled, the chief criterion for closing. Members of a commission assembled to gather public input on the issue told CPS officials earlier this year that closing a large number of schools would create too much upheaval. The Tribune, citing sources, said the commission indicated a far smaller number should be closed than initially feared, possibly as few as 15.


CPS then started holding its own hearings and on Wednesday, while following many of the formal recommendations made by the Commission on School Utilization, said 129 schools still fit the criteria for closing.


The new number and the latest round of hearings sets the stage for the administration to counter questions about the district's abilities to close a large number of schools and the need to do so.


For many who have already turned up to school closing meetings, this final round of hearings will be even more critical. School supporters must show how they plan to turn around academic performance and build enrollment, and also make the case for any security problems that would be created by closing their school.


"We are prepared now to move to the next level of conversation with our community and discuss a list of approximately 129 schools that still require further vetting and further conversation," Bryd-Bennett said. "We are going to take these 129 and continue to sift through these schools."


In the past, political clout has played a role in the district's final decisions. Already this year, several aldermen have spoken out on behalf of schools in their wards.


On the Near Northwest Side, for instance, the initial list of 330 underused schools included about six in the 1st Ward. Ald. Proco "Joe" Moreno helped organize local school council members, school administrators and parents to fight any closing. He also took that fight to leaders in City Hall and within CPS' bureaucracy. Nearly all of the schools in the ward were excluded from the list of 129.


"It is effort and it's organizing and not just showing up at meetings and yelling. Anybody can do that," Moreno said. "Those schools that proactively work before those meetings and explain what they are doing, what they need and that they are willing to accept new students, that's when politics works.


"My responsibility in this juncture was to focus on these schools," he said. "I had to work on the inside, with CPS and with City Hall, and with my schools on the outside."


Most of the schools on the list of 129 are on the West, South and Southwest sides, many in impoverished neighborhoods that saw significant population loss over the last decade. Largely spared were the North and Northwest sides.


In all, more than 43,000 students attend those 129 schools on the preliminary list, according to CPS records.


The area with the most schools on the list is a CPS network (the district groups its schools in 14 networks) that runs roughly from Madison Street south to 71st Street and from the lake to State Street. The preliminary list includes 24 schools in that area.


The Englewood-Gresham network has the second-largest number, 19, while the Austin-North Lawndale network where Wednesday night's meeting was held still has 16 schools on the list.


CPS critics said the preliminary list is still too large to be meaningful and that the district's promise to trim it before March 31 is only a tactic to make the final number seem reasonable.


"They started out with such a far-fetched, exaggerated list of schools, many of which are nowhere near underutilized," said Wendy Katten, co-founder of the parent group Raise Your Hand. "They might appear to be looking like they're listening, but they're not. They have not done a thorough and substantive assessment of these schools."


Following the commission's recommendations, CPS last month removed high schools and schools performing at a high level academically from consideration. On Wednesday, the district said schools with more than 600 students or utilization rates of at least 70 percent have also been taken out of consideration for closing.





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North Korea nuclear test prompts stern warnings from neighbors


SEOUL/TOKYO (Reuters) - South Korea sent a stern warning to North Korea on Thursday, two days after the North tested a nuclear bomb, saying it could strike the isolated state if it believed an attack was imminent as it deployed a new cruise missile to drive home its point.


North Korea conducted its third nuclear test on Tuesday, in defiance of U.N. resolutions, pushing it further along the path of developing a workable long-range nuclear missile and drawing condemnation from the United States, Japan, Europe and the North's only major ally, China.


Pyongyang said that the test was designed to bolster its defenses due to the hostility of the United States, which has led a push to impose sanctions on the country after its long-range missile launch.


North Korea on Thursday repeated its warning that any further sanctions would provoke it into taking firmer action.


Seoul warned that it would strike if attacked. South Korea has already relaxed rules allowing troops on the border to return fire directly without seeking permission from the army chiefs.


"The cruise missile being unveiled today is a precision-guided weapon that can identify and strike the window of the office of North Korea's leadership," Defence Ministry spokesman Kim Min-seok told reporters."


Japan, which has little capacity to strike at the North if threatened by an attack because of the constraints of its pacifist constitution, said it had the right to develop such capability in response to changes in the regional security situation - but had no plan to do so at present.


"When an intention to attack Japan is evident, the threat is imminent, and there are no other options, Japan is allowed under the law to carry out strikes against enemy targets," Defence Minister Itsunori Onodera told Reuters in an interview.


"Given Japan's political environment and the peace-oriented diplomacy it has observed, this is not the time to make preparations (for building such capability)," he said.


"But we need to carefully observe the changing security environment in the region."


Any sign that Japan was moving to develop such a capability would upset neighbors China and South Korea, where memories of Tokyo's past military aggression run deep and which have reacted strongly in the past to suggestions it might do so.


It is unlikely the United States, which acts as a security guarantor for both its allies, would permit any major escalation in any conflict with North Korea.


Japan and China are engaged in a bitter island dispute that has soured relations between the two and alarmed Washington while Seoul and Tokyo have also clashed verbally over a separate disputed island.


DIPLOMATIC STAKES RAISED


The United States and its allies are pushing for new sanctions at the U.N. Security Council aimed at slowing North Korea's nuclear and long-range missile development.


President Barack Obama spoke to Japanese Prime Minister Shinzo Abe on Wednesday about North Korea's nuclear test and reaffirmed U.S. commitments to Japan's security.


"They pledged to work closely together to seek significant action at the United Nations Security Council and to cooperate on measures aimed at impeding North Korea's nuclear and ballistic missile programs," the White House said in a statement after the call.


The United States and its allies are believed to be pushing to tighten the noose around North Korea's financial transactions in a bid to starve its leadership of funding.


Japan's Onodera called on the North's biggest benefactor, China, to join in strengthening the sanctions.


"I think China is the one that is most concerned about the development ... From now on, it is necessary for us, including China, to seek effective steps, effective economic measures (against North Korea)."


North Korea has repeatedly said it is planning what it terms "stronger measures" against the United States and its allies, although it hasn't specified what those could be.


It is not capable of hitting the United States, but its medium-range missiles can hit Japan and South Korea. It also has an estimated 8,000 artillery systems stationed within 100 km of the heavily militarized border between the two Koreas.


"If the U.S. and its allies challenge the DPRK (Democratic Peoples Republic of Korea) with 'strong measures', (a) 'financial freeze' and fresh pressure and 'sanctions' over its underground nuclear test, it will react to them with stronger measures for self-defence," its KCNA news agency said on Thursday.


Australia signaled its displeasure with Pyongyang by banning diplomats seeking to reopen an embassy there from visiting the country.


While it was still unclear what fissile material North Korea used in its third nuclear test - its statements appeared to indicate that it was likely plutonium as it is easier to miniaturize than uranium - it seemed that initial environmental fears about the test were not realized.


China's Environment Ministry said it had found no abnormal radiation from the test site, which is around 100 km from its border. South Korea too said it had not detected any radiation.


(Additional reporting by Fayen Wong in SHANGHAI; Rob Taylor in CANBERRA; Writing by David Chance; Editing by Linda Sieg and Nick Macfie)



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Stock index futures point to slightly higher start

LONDON (Reuters) - Stock index futures pointed to a slightly higher open on Wall Street on Wednesday, with futures for the S&P 500, the Dow Jones and the Nasdaq 100 up 0.1-0.2 percent at 0958 GMT (4.58 a.m EST).


European shares were slightly lower, although they remained near the top of a six-day trading range. French bank Societe Generale sank 3.7 percent after it unveiled a bigger-than-expected quarterly loss.


U.S. President Barack Obama said in his State of the Union speech on Tuesday he backs higher taxes for the wealthy and a $50 billion spending plan to create jobs by rebuilding degraded roads and bridges.


The U.S. Commerce Dept. releases U.S. retail sales data at 1330 GMT. It was expected to show a 0.1 percent rise in January, slowing from a 0.5 percent increase in December as consumers eyed smaller paychecks on the back of a recent tax increase.


Business inventories data for December, due at 1500 GMT, are expected to show a rise of 0.3 percent, a repeat of the November increase.


Comcast Corp clinched full control of NBC Universal for $16.7 billion on Tuesday, the latest in a series of deals that have taken the cable operator from humble roots in Tupelo, Mississippi, to Manhattan's iconic Rockerfeller Center.


The group is due to unveil fourth-quarter results before the market open, with earnings per share seen at $0.53 from $0.47 one year earlier.


Networking equipment maker, Cisco Systems , is expected to report a $0.01 increase in its quarterly earnings per share, with corporate North America and parts of Europe showing signs of improvement. The results are due after the market close.


Chip-maker Nvidia is also among companies due to report quarterly results.


Clearwire Corp , the wireless service provider that both Sprint Nextel S.N and Dish Network DISH.O want to buy, said on Tuesday that it would need Sprint financing to keep afloat up to the end of the year.


Asset manager Legg Mason Inc is preparing to name its interim head, Joseph Sullivan, as its permanent chief executive, two people familiar with the matter said, as the company turns to a sales chief to stop an outflow of funds.


BlackRock Inc named Morgan Stanley MS.N banker and long-time financial advisor Gary Shedlin as its next chief financial officer, to succeed Ann Marie Petach.


Yahoo Inc Chief Executive Marissa Mayer said the company's search partnership with Microsoft Corp was not delivering the market share gains or the revenue boost that it should.


The Dow Jones industrial average <.dji> closed 47.46 points higher, or 0.34 percent, at 14,018.70 on Tuesday. The Standard & Poor's 500 Index <.spx> was up 2.42 points, or 0.16 percent, at 1,519.43. The Nasdaq Composite Index <.ixic> was down 5.51 points, or 0.17 percent, at 3,186.49.


(Reporting by Francesco Canepa; editing by Patrick Graham)



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No. 8 Michigan State routs No. 4 Michigan 75-52


EAST LANSING, Mich. (AP) — Michigan State has muddled through much of its season, finding ways to win games short on style with gritty substance.


The eighth-ranked Spartans, though, showed their potential in an impressive 75-52 win over No. 4 Michigan on Tuesday night in the rivalry's first matchup of top 10 teams.


"The sky is the limit," guard Keith Appling said.


If Michigan State can play anything like it did against the Wolverines, Appling might be right.


The Spartans (21-4, 10-2 Big Ten) broke a first-place tie in the conference with No. 1 Indiana, which plays at Michigan State next Tuesday after the Spartans try to avoid a letdown Saturday night at Nebraska.


Appling acknowledged he was a little bit surprised by the lopsided victory — the school's largest since beating Michigan by 27 points in 2002 — but shrugged off the significance of it with much of the regular season remaining.


"We just have to take it for what it is and prepare for our next game," Appling said.


The Wolverines (21-4, 8-4) have lost three of four, but the closely contested setbacks on the road against the Hoosiers and at Wisconsin were nothing like the latest when they were held to a season-low points total.


"They bullied us — point blank," said Tim Hardaway Jr., who matched a career low with two points.


Michigan State didn't trail once, led by as many as 16 points in the first half and enjoyed 30-point leads in the second.


"We probably played our best game in three years," Spartans coach Tom Izzo said. "And, they probably played one of their worst."


Michigan coach John Beilein agreed.


"That was the worst we've played in a long, long time and credit Michigan State for that," he said.


Burke scored 18 points for the Wolverines and didn't get much help from his teammate offensively, or defensively.


"It was an embarrassing loss," Burke said.


Hardaway Jr. was held scoreless until making a layup in the opening minute of the second half — after turning down Beilein's suggestion to work on his shot during halftime warmups — and didn't score again. Hardaway was 1 of 11 from the field.


"He's been playing as good as any player in the country," Beilein said. "He had a bad night, credit Michigan State's defense. Tim had a bad night and Tim Hardaway will bounce back like he always has."


Glen Robinson III was 1 of 4 and scored two points to match his season low.


The Wolverines, who pride themselves on taking care of the basketball, had a season-high 16 turnovers and didn't have much success getting the ball away from the turnover-prone Spartans. Michigan made fewer than 40 percent of its shots and scored one fewer point than it did in a three-point loss at Ohio State.


"Maybe we got exactly what we deserve and it's medicine for the future," Beilein said.


Everything went right for Michigan State, which had just eight turnovers and made 48-plus percent of its shots.


Gary Harris scored 17 points, making five 3-pointers, and Derrick Nix had his way on the inside, scoring 14 points as part of a balanced offense.


Appling had 11 points and Branden Dawson scored 10 before leaving the court late in the game because Michigan's Mitch McGary hit him in the face inadvertently with his right arm.


Izzo said Dawson got hit in the nose and had a cut on his lip.


"I do think he's going to be OK," Izzo said.


Matt Costello scored a season-high eight points and fellow freshman Denzel Valentine had seven points to help Michigan State win its second straight in the series after losing three in a row following a run of dominance for the Spartans.


White-clad fans in the stands were fired up before the game even started and they stayed enthusiastic, standing for much of the game, because the home team gave them plenty of reasons to cheer from start to finish.


"The crowd was just awesome," Izzo said. "It kind of reminded me of back in the day."


In the first matchup of 20-win teams in Division I basketball this season, Michigan State showed it might not be a rebuilding this season.


Michigan, meanwhile, has been humbled since being ranked No. 1 last month for the first time since the 1992-92 season.


"It was a big step for us, but don't think that's the real Michigan team because it's not," Izzo said.


___


Follow Larry Lage on Twitter: http://twitter.com/larrylage


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Obama's chance to lead?






STORY HIGHLIGHTS


  • John Avlon: President Barack Obama is well-positioned to help solve debt problem

  • He says Obama should avoid temptation favored by some Democrats to put off action

  • Relatively modest changes in entitlements could help ensure their survival, Avlon says

  • Avlon: Obama can rally his party behind deficit cuts that won't hurt economy




Editor's note: John Avlon is a CNN contributor and senior political columnist for Newsweek and The Daily Beast. He is co-editor of the book "Deadline Artists: America's Greatest Newspaper Columns." He is a regular contributor to "Erin Burnett OutFront" and is a member of the OutFront Political Strike Team. For more political analysis, tune in to "Erin Burnett OutFront" at 7 ET weeknights.


(CNN) -- "What we have done is kicked this can down the road. We are now at the end of the road and are not in a position to kick it any further. ... We have to signal seriousness in this by making sure some of the hard decisions are made under my watch, not someone else's."


So said President-elect Barack Obama at a Washington Post editorial board meeting in January 2009, just days before taking his first oath of office. He was talking about the importance of dealing with the long-term deficit and debt.


The rhetoric hasn't met the record -- debt has exploded under Obama's watch. Reasonable people can forgive the president for expenses incurred while confronting the worst financial crisis since the Great Depression -- and, let's be honest, alternative paths of austerity have not worked that well across the Atlantic. But now is the time to get serious about reigning in our long-term debt, which now exceeds an unsustainable 70% of gross domestic product.


At this moment of maximum political capital, Obama is perfectly positioned to act on his original impulse in the State of the Union on Tuesday night.


But there is a dangerous bit of hubris sweeping the Democratic Party, which says that dealing with deficits and debt is a sucker's bet, best left to the next Republican president.


Instead, the Keynesians are riding high and arguing that deficit and debt is not a primary concern to most voters and irrelevant to economic growth. And so the pregame expectation setting comes: White House minions told The Washington Post not to expect the president to present "an ambitious new plan to rein in the debt" in the State of the Union.


Opinion: Obama needs to lay out a plan on climate crisis


This would be a major mistake and a costly lost opportunity.



With an eye toward his legacy, Obama should follow his original instincts and put the power of presidency behind a balanced long-term plan to deal with deficits and debt -- including spending cuts, tax reform and, most importantly, entitlement reform.


This is the time for Obama to pull a Nixon in China.


Just as only a committed anti-communist such as Nixon could establish relations with communist China, Obama is perfectly positioned to do what he knows is necessary to preserve the long-term strength and solvency of the social safety net: Medicare and Social Security.


This does not mean draconian cuts or a voucherization of the existing system as imagined by Rep. Paul Ryan and many House Republicans. But it does mean following through on the president's previous negotiated offers to consider "chained CPI," which would lower inflation-related increases in Social Security benefits, and to raise the eligibility age for Medicare.








Formula adjustments such as these can save billions of dollars over the next 10 years, keeping these popular programs solvent. Other solutions, such as raising the Social Security payroll tax cap to more than the current income cutoff of $110,000, are worth consideration as part of a package. This is an idea that liberals love because it extends the progressivity of the tax code to the wealthiest Americans.


Alternatively, we could means-test Social Security to make sure it serves primarily as a safety net -- or (gasp!) raise the retirement age. When the Bowles-Simpson commission suggested raising the retirement age to 69 in 2075, it was met with howls of outrage from unions in particular. This makes no sense, especially if common-sense exemptions are made for manual labor.


Beltway cynics say that the bipartisan deficit and debt reduction plans that are often cited have no chance of passing Congress. When you look at the pathetic support for Bowles-Simpson when it was actually put to a vote in the House last March -- 16 Republicans and 22 Democrats supported it -- you see why cynicism is always a safe bet in Washington.


But take a step back, and you'll see much broader support among the American people. The Pew Research Center found that the top three issues are "strengthening the economy" (at 86%), "improving the jobs situation" (79%) and "reducing the budget deficit" (at 72%). Crucially, the deficit has shown the biggest increase as an issue over the past four years -- up 19 percentage points from 2009. This is evidence of a pent-up demand for action -- but it will require presidential leadership.


Of course the devil is in the details, and politicos will point out that when confronted with tough medicine to deal with deficits and debt, even alleged tea party supporters balk (hence the classic "Government Get Your Hands Off My Medicare!" sign that I saw at one 2009 rally).


But strengthening America to remain competitive in the 21st century will require getting our long-term debt under control along with other important but less poll-prioritized policies such as comprehensive immigration reform and a public-private infrastructure bank to fund nation-building "here at home."


The State of the Union is a chance for the president to put forward a balanced bipartisan solution that contrasts with radical conservatives who believe that increased tax revenues from closed tax loopholes can't be part of a big deal to bring down our debt. Wall Street lawyers will fight to protect every loophole they embedded in our tax code, but their argument doesn't begin to make sense to people on Main Street.


Obama will probably point out Tuesday night that economic growth is the essential X Factor to reducing long-term deficits and debt. On this point at least, he and some conservatives might agree. But dumb meat cleaver cuts such as the looming sequestration could push our economy back into recession.


That's why a smart balanced alternative plan is necessary. But it will require presidential leadership and putting some Democratic sacred cows on the table.


This doesn't just make practical sense in a divided government (a reality some Democrats seem to forget) -- it makes compelling political sense as well. By seizing the mantle of fiscal responsibility -- in contrast to fiscal conservatism -- Obama will build on his post-election bump among centrists and some independents.


The more Machiavellian Democrats might argue that this outreach could only serve to isolate Republicans more. Nonpartisan strategists might argue that this approach would drive a wedge between reasonable Republicans and the House radicals.


But the real reason for Obama to address the need to reduce long-term deficits and debt directly is because it's the right thing to do for our country -- and he is uniquely positioned to achieve it. Just as Nixon could go to China, a Southern Democrat such as Lyndon Johnson was needed to pass civil rights legislation and Bill Clinton was able to sign welfare reform after decades of Republicans talking about it, Obama can put our country on a balanced path of long-term economic growth and fiscal responsibility.


Bottom line: Obama has the political opportunity, but does he have the political will? We'll all find out in real time if he decides to lead on this issue or just be the latest in a long line to kick the can further down the road.


Follow us on Twitter @CNNOpinion.


Join us on Facebook/CNNOpinion.


The opinions expressed in this commentary are solely those of John Avlon.






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Dorner case: Human remains found in debris of burned cabin









Charred human remains have been found in the debris of the burned-out Big Bear area cabin where police believe fugitive ex-cop Christopher Dorner was holed up, authorities said.

Investigators will attempt to identify the remains through forensic means, the San Bernardino County Sheriff’s Department said in a statement.







Dorner, whose alleged crimes have kept Southern California on edge for days, is wanted for the slayings of an engaged couple and two law enforcement officers. He was believed to have shot at pursuing law enforcement officials, then fled into a cabin shortly before it ignited Tuesday afternoon near ski resorts in the San Bernardino Mountains.

Authorities had lost track of Dorner since late last week. Then, on Tuesday, two maids stumbled upon a man resembling Dorner as they arrived to clean a vacant cabin.


The suspect was found close to where law enforcement officials had held news conferences over the weekend concerning their search for Dorner, 33, and near where Dorner’s car was set aflame last week.


The suspect tied the two maids up, took a car from the residence and left, according to a law enforcement official. One of the maids was eventually able to break free at the residence in the 1200 block of Club View Drive, close to Snow Summit and Bear Mountain Resort, and called 911 at 12:20 p.m.


Then, at 12:45 p.m., according to state Fish and Wildlife officials, the suspect was allegedly driving a purple Nissan on California 38 when he passed a marked vehicle driven by the agency’s law enforcement officers.


The officers recognized the suspect as he passed and swung their vehicle around in pursuit.


The suspect attempted to evade them by turning off onto Glass Road, and at some point crashed and abandoned the small car.


With officers still in pursuit, the suspect then stopped a truck driven by another resident and ordered him out of the vehicle.


Behind the wheel of the stolen truck, the suspect was once again careening down Glass Road, and once again he passed a Fish and Wildlife vehicle coming from the opposite direction. Again an officer recognized the suspect. That driver radioed his colleagues traveling behind him that the suspect was heading in their direction in a silver pickup.


When the suspect saw the second Fish and Wildlife truck approaching, he rolled down his window and took aim. The suspect opened fire into the cab as the vehicles passed just two feet apart, shattering the driver's side window and strafing the state truck with a handgun.


The badly damaged truck skidded to a halt and a game warden, a 35-year-old former Marine, fired 20 rounds from a high-powered rifle as the suspect fled in the hijacked truck.


The suspect subsequently crashed that truck and ran into the woods. He ended up in the cabin. A firefight ensued. Two San Bernardino County sheriff’s deputies were shot; one was pronounced dead at a hospital, while another is undergoing surgery. Hundreds of rounds were fired in the firefight.


For days, multiple law enforcement agencies from across Southern California laid out a dragnet for the man accused of going on a revenge-fueled rampage following his termination from the LAPD in 2008. In addition to the San Bernardino County sheriff’s deputy who was fatally wounded Tuesday, Dorner allegedly killed the 28-year-old daughter of a former LAPD captain, her fiance and a Riverside police officer.






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Pope asks for support after decision to resign, says strength diminishing


VATICAN CITY (Reuters) - Pope Benedict, in his first public comments since he announced that he would become the first pontiff in centuries to resign, on Wednesday said he was fully aware of the gravity of his decision but confident that it would not hurt the Church.


"Continue to pray for me, for the Church and for the future pope," he said in unscripted remarks at the start of his weekly general audience, one of his last public appearances before he resigns on February 28.


The pope, who looked and sounded strong, was interrupted several times by thunderous applause from the some 8,000 faithful and tourists who packed the vast audience hall.


In brief, prepared remarks that mirrored those he read to stunned cardinals when he announced his decision on Monday, the pope said God would continue to guide the Church because it was much more than its earthly leader.


"I took this decision in full freedom for the good of the Church after praying for a long time and examining by conscience before God," he said.


He said he was, "well aware of the gravity of such an act but at the same time aware of not being able to carry out my (papal) ministry with the physical and spiritual force that it requires".


Benedict said he was sustained by the "certainty that the Church belongs to Christ, who will never stop guiding it and caring for it".


He said that "he felt almost physically" the affection and kindness he had received since he announced the decision.


Later on Wednesday, an Ash Wednesday Mass that was originally scheduled to have taken place in a small church in Rome, has been moved to St Peter's Basilica so more people can attend.


Unless the Vatican changes the pope's schedule, it will be his last public Mass.


(Reporting By Philip Pullella; editing by Barry Moody)



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