Wednesday, February 20, 2013

GOP Secretary Of State: Allowing Citizens To Register On Election Day Undermines Their ‘Individual Freedoms’

Georgia Secretary of State Brian Kemp (R)

Giving citizens the flexibility to register to vote (or update their existing registration if they’ve recently moved) on Election Day actually chips away at Americans’ “individual freedoms,” according to Georgia Secretary of State Brian Kemp (R).

During a panel discussion on voting at the conservative Heritage Foundation on Thursday, Kemp lambasted the idea of same-day voter registration. Ten ideologically diverse states, from Idaho to Wisconsin to California, have enacted the program, also known as Election Day registration. By removing barriers to voting and making it easier for citizens to register, studies have found that EDR boosts turnout on average by 7 to 14 percentage points.

Kemp dismissed EDR as a “buzzword” that is as an affront to Americans’ right not to participate in elections. “[It] really gets down to the individual freedoms of people in our state and Americans in general and their ability to decide for themselves, ‘yes I want to register to vote and participate in the process, or no that I don’t,” Kemp said.

KEMP: I think we do have to have commonsense protections to make sure that our rolls are secure to stop potential voter fraud. This whole issue with dealing with the federal government and universal registration and same-day registration and all these different buzzwords really gets down to the individual freedoms of people in our state and Americans in general and their ability to decide for themselves, “yes I want to register to vote and participate in the process, or no that I don’t.”

Watch it:

There are countless problems with our voting system, but infringing on Americans’ right to not vote is not one.

Regardless, Kemp’s assertion that EDR somehow compels citizens to vote is ludicrous. The law simply allows those citizens who want to to register on Election Day.

In fact, Georgia, as much as any state, could benefit from EDR. In 2012, the Peach State ranked 33rd out of 50 states with a voter turnout of 58 percent. Meanwhile, five of the top six voter turnout states have EDR.


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From ‘Precious’ To ‘Fruitvale’ And ‘Blue Caprice,’ Sundance As Showcase For Black Stars

This post discusses plot points from Fruitvale and Blue Caprice, both of which are based on true events.

Before The Weinstein Company bought 26-year-old writer-director Ryan Coogler’s debut feature Fruitvale, an examination of the 24 hours that lead up to the shooting death of Oscar Grant at the Fruitvale BART station on New Year’s Eve in 2008, Mike Fleming Jr. wrote on Deadline that “The feeling from buyers I’ve spoken to who’ve seen it is that Fruitvale has the potential to be one of those festival pictures that come out of nowhere — like Precious and Beasts Of The Southern Wild — to capture audience and critical acclaim.”

What Fleming didn’t note in his post is that Fruitvale, Precious, and Beasts Of The Southern Wild all star African-American actors, and both Fruitvale and Precious, which was directed by Lee Daniels, were directed by African-American men. Sundance has gotten more buzz this festival for the number of films in its narrative feature competition that were directed by women. But it’s equally important to note the festival’s role in creating buzz for films about African-American characters that translate into distribution deals and profits: Precious made $47.6 million domestically on a production budget of $10 million, while the even lower-budget Beasts has made $11.5 million on a $1.8 million production budget.

Two of the best movies I saw at this year’s festival, Fruitvale and Blue Caprice, an examination of the growth of a fictionalized version of the relationship between Beltway Snipers John Allen Muhammad (Isaiah Washington) and Lee Boyd Malvo (Tequan Richmond), directed by Kanye West collaborator Alexandre Moors, fell into that category. To a certain extent, they’re formally similar chronicles of deaths foretold. Both begin with footage of the real-world events they explore, Blue Caprice with a montage of news footage of Muhammad and Malvo’s killing spree, and Fruitvale with cell phone video of Grant’s shooting on the BART platform. But from there, they become complementary movies on separate paths. If Fruitvale is about how prejudicial suspicion of black men can inject deadly violence into a specific life at random, Blue Caprice explores how two men build a highly specific and fatal future.

In Fruitvale, Oscar (an exceptional Michael B. Jordan) is year out of prison and almost compulsively on the make, a young man attempting to close the gap between his considerable charm and his lack of discipline. As the movie begins, he’s just talked his girlfriend and the mother of his daughter, Sophina (Melonie Diaz) into taking him back after he cheated on her, though he’s less successful in talking the grocery store manager who fired him for lateness into giving him back his job, even when he tries to manipulate the man’s emotions and white liberalism, asking him “You want me selling dope, Brad?” At the store, he flirts with Katie (Ahna O’Reilly), a young white woman who’s gotten herself bollixed up trying to pick fish to fry for her boyfriend for a New Year’s Eve dinner. “It sounds like he’s black,” Oscar teases her, before putting her on the phone with his Grandma Bonnie, who sets Katie straight. When he finally comes clean to Sophina about losing his job, he does it two steps, first telling her that he’s unemployed, and finally admitting that he’s been so for several weeks. In between that admission and ditching a stash of marijuana he intended to sell to make the month’s rent, Oscar’s in a precarious, but hopeful position: he’s made some moves away from both dishonesty and criminality, but hasn’t started to look for legal employment or started to feel a serious pinch. As he tells Sophina, who explained to him of her New Year’s resolution to cut carbs that it takes 30 days to form a habit, he needs to “just not fuck up” for a month.

There’s a marvelous specificity to Oscar and his family and friends—one that illustrates the kind of character shading Hollywood products give up when they embrace colorblindness as a false token of progressivism—set against the more general forces that produce Oscar’s death. “Don’t get me no fake-ass card with no white people on it,” Oscar’s sister Chantay (Destiny Ekwueme) warns him as they prepare to celebrate their mother’s (Octavia Spencer) birthday. “Get me a black card.” Oscar, ham that he is, finds a card with a photograph of a middle-aged white woman on it, just to tweak her. In a flashback to his time in prison, Oscar dreams of getting his daughter into one of the Bay Area’s bilingual schools so she can learn Spanish and use it with Sophina’s family. At the birthday dinner, one of Oscar’s relatives jokes that, though he’s a lifelong Raiders fan, he’ll root for the Steelers in the upcoming Super Bowl because of their “black uniforms, black players, black coach. He even has a black wife.” On the BART on the way into the city for the New Year’s fireworks display, a ride that turns into a raucous party in the subway car, one of Oscar’s friends gets complimented by half of an African-American lesbian couple with whom the group is sharing a blunt. “I like your dreads,” the woman tells him. “I like your everything,” he tells her back. “We gay,” she informs him, fending off the pass. “That’s a coincidence,” the man recovers. “We gay, too…Oscar, ain’t we gay?”

But just because we’ve come to know Oscar as a specific, compelling person doesn’t mean that he can’t be reduced, in a violent instant and by the prejudices of powerful people, to an anonymous and amorphous threat. Given that we know Oscar’s death is approaching, there’s a terrible weight to Oscar’s mother’s suggestion that he take the BART rather than driving in case he wants to drink, to Sophina’s insistence that the couple go out for the evening even though Oscar points out they could count down the waning year at home. Coogler stages the final moments of Oscar’s life with great detail, from a run-in with an old prison adversary that produces a scuffle on the BART, to Oscar’s taking cell phone photos of the badge numbers of the officers who detain him and his friends (though not his white former enemy), to the white officer who reacts badly when he thinks Oscar’s called him a nigger. As Oscar is detained, shot, and begins to bleed to death on the BART platform, we can only react like Katie, who runs into Oscar on the train, and films his murder, screaming at the officers who push her back into the car to stop her. Our witness to his humanity is not enough to counter bias paired with deadly force. Fruitvale may be a movie that makes white audiences—and the overwhelmingly white audience with whom I saw Fruitvale cried audibly into the Q&A period—feel good about their liberalism, but it also questions how useful that sympathy is unmoored from profound changes in policy and society.

If Fruitvale is about what happens when a specific black man is rendered anonymous and unkillable, Blue Caprice is about what happens when a man becomes convinced that he is uniquely persecuted, and turns his rage against women onto society as a whole for the sins of enabling what he sees as women’s perfidy. When we meet Lee (Richmond), his mother’s just left him alone in Antigua so she can move to the United States. It’s a decision that leaves the deeply withdrawn Lee wandering around an empty house, accumulating a sink full of dirty dishes and draining the contents of their refrigerator, and eventually following a handsome man and his three children. Lee’s loneliness is so profound, and the image of a functional father so powerful that Lee literally walks into ocean water he can’t swim in to attract the man’s attention: unmet needs for rescue and care turn into an almost predatory instinct.

But it’s clear almost as soon as he’s invited into their home that Lee’s rescuer, John (Washington) hasn’t restored him to normalcy. “Remember, you guys are on a special vacation with Papa,” John tells his children. “And if Mama comes, you couldn’t see Papa anymore. Is that what you want, for Papa to get in trouble?” As it becomes clear, John’s a custodial kidnapper, and when his children are taken from him (events that happen off-screen in a nine-month time lapse), he brings Lee to Washington State with him in their place, claiming him as his son, and a fulfillment of John’s own need for someone to worship him, and to validate his consuming rage at the fact his children were taken from him, and a restraining order placed against him.

“I used to live here. People used to live here,” John tells Lee on a tour of his old neighborhood in Washington. “Some people turned into vampires…Sucked me dry…There are some evil people in this world…That’s what they do. They take your kids away. They say I kidnapped my kids. How can I kidnap my own kids?” Lee tells his mentor that “Vampires can’t die. Sorry. They aren’t people.” But even though he appears to be pushing back against John, Lee’s demonstrating the extent to which he’s being absorbed into John’s worldview: John is persecuted, and his enemies are both inhuman and difficult to dispatch or dismiss. It’s a vision of the world that escalates over time. “I can’t take her to court,” John tells Lee of his ex-wife, who keeps evading him. “Not that it would do any good. They never give custody to the father.” Shopping in a supermarket, John turns his rage on a wider aperture, preaching to Lee that “They think all of this is permanent…All it would take is a little push. Only a few bodies. Five or six a day for thirty days. Random targets. Not random targets. They think it’s men? Do a woman. Think it’s women? Kill a kid. Think it’s kids, kill a pregnant woman. Kill a cop.”

And John requires Lee to demonstrate his fidelity to that worldview. “Bitch wants to call me a liar. She’s a liar. They’re all liars,” John rants after his girlfriend catches him stealing her jewelry and kicks both him and Lee out of the house. “I brought you here. I gave you all this. It’s not enough to just say the words. You have to prove it. Do you love me? Then you have to do something for me.” The “something” Lee chooses to do is deeply informed by John’s misogyny and paranoia.

After that, when they prepare to expand their campaign beyond the site of John’s personal grievances, they try to buy arms from a white dealer (The Wire‘s Leo Fitzpatrick), who mistakes their complaints for racial ones. “I’m not down for your cause, this Black Panther shit,” he warns John and Lee. But African-American men are as capable of generalized misogyny and and messianic fantasies as white ones are. John dreams of extending his plan, telling Lee “We’ll pick a spot up in the woods in Canada. Find other kids like you, train them…Send them into other cities to do what we did…The beauty is, even if we lose, we wake people up. We still win.” He’s as particular in his hatreds as Oscar Grant is in his loves and hopes.


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Democrats dis-'like' Zuckerberg's Christie fundraiser on Facebook

By Alicia M. Cohn - 01/24/13 03:43 PM ET

The Democratic and Republican governors associations are engaging in a war of "likes" and "dislikes" on Facebook Thursday afternoon over Facebook founder Mark Zuckerberg.

Zuckerberg announced Thursday that he would host a political fundraiser, for the first time in his own home, for New Jersey Gov. Chris Christie (R) on Feb. 13. The fundraiser will support Christie's reelection as governor.

The Democratic Governors Association (DGA) is using Facebook to show its "dislike" of the move by the social network's founder, posting a thumbs-down graphic with the news and inviting supporters to sign a petition to call on Zuckerberg to cancel his fundraiser for Christie.

The Republican Governors Association (RGA) is promoting the news as well, in a post that urges supporters to use the thumbs-up button. "This definitely deserves a lot of LIKES!" the RGA wrote.

The RGA also sent a barbed tweet at its Democratic counterpart making a pointed comment about the number of states currently represented by Democratic governors.

In a statement, a spokeswoman for Facebook said Mark and Priscilla Zuckerberg "admire [Christie's] leadership on education reform and other issues."

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Study: South American Glaciers In Historic Retreat

One of the more dramatic effects of global warming is shrinking glaciers around the globe. 10 to 20 percent of glacier ice in the European Alps, for example, has been lost in less than two decades, and half the volume of the mountain range’s glacier ice has melted away since 1850.

Thinning and melting rates in Alaskan glaciers more than doubled over the last decade, African glaciers have declined by 60 to 70 percent since the 1900s, and most Pacific glaciers are also receding. Summer ice coverage in the Arctic could disappear entirely within a decade, and Glacier National Park may not have any glaciers by 2030.

This isn’t just destructive to wildlife and ecosystems. Given their locations, glaciers can serve as crucial supplies of fresh water for various human populations — and as they shrink year after year, those supplies tighten.

The latest example comes from a new report by The Cryosphere, which documents the shrinkage of glaciers in the Andes mountain range of South America. The glaciers have shrunk by at least a third, and possibly as much as half, since the 1970s alone. And the worst loss has been seen in the smaller, lower altitude glaciers which supply fresh water for many of the continent’s residents, according to a round-up of the report by Reuters:

Climate change has shrunk Andean glaciers between 30 and 50% since the 1970s and could melt many of them away altogether in coming years, according to a study published on Tuesday in the journal Cryosphere.

Andean glaciers, a vital source of fresh water for tens of millions of South Americans, are retreating at their fastest rates in more than 300 years, according to the most comprehensive review of Andean ice loss so far.

The study included data on about half of all Andean glaciers in South America, and blamed the ice loss on an average temperature rise of 0.7 degree Celsius over the past 70 years. [...]

The researchers also warned that future warming could totally wipe out the smaller glaciers found at lower altitudes that store and release fresh water for downstream communities.

The plot above tracks the changes in surface area for the various glaciers in the Andes since the Little Ice Age in the mid-17th to early-18th centuries. The measurements prior to 1940 were put together from studies of debris associated with the glaciers, and reconstructed from aerial photographs after that point. The drop-off in the second half of the 20th Century is precipitous.

The Zongo Glacier (the red squares) managed to avoid the dramatic shrinkage of the other glaciers because it sits at a higher altitude. The lower altitude glaciers are more vulnerable to temperature shifts, and thus have seen the worst of the melting. They’re also the glaciers that supply fresh water for both the agriculture and consumption of large populations in the arid regions of Peru and Bolivia, serving as a buffer for those communities during the dry season from May/June to August/September.

As the glaciers recede, that buffer shrinks, leaving those water supplies ever more strained. Meanwhile, the tendency of global warming to drive more extreme weather patterns could exacerbate the severity of the dry season, dealing a double blow to the people of Peru and Bolivia.

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Why J.J. Abrams Is A Bad Choice To Direct Star Wars Episode VII

Because we really need our pop culture franchise to be dominated by an increasingly limited number of visions, Deadline and other outlets are reporting that J.J. Abrams will direct Star Wars Episode VII:

Star Trek director J.J. Abrams will be helming the next Star Wars movie. “It’s done deal with J.J.,” a source with knowledge of the situation told Deadline today. Argo director Ben Affleck was also up for the gig, the source says. Michael Arndt is writing the script for the first installment of the relaunch of George Lucas’ franchise by Disney.

There are two issues here: how well-suited Abrams is for Star Wars in particular, and the consolidation of big franchises under a very limited number of perspectives (especially since the perspectives are those of white dudes).

On the question of Abrams as a fit for Star Wars, I’m deeply ambivalent. I think the franchise has been at its weakest when it’s delving too deeply into the details of its mythology. In the initial trilogy George Lucas and his collaborators had the wisdom to retain the emotional power of the Force as a cinematic device by leaving it relatively mysterious. Once the movies started delving into midichlorians and the manifestations thereof, the Force started to seem clunky and silly, no longer something those of us at home could dream of accessing. Abrams and his collaborators have a weakness for focusing on mysteries and exploring them to death, be they Smoke Monsters, strings of numbers, or aliens rampaging around New York City. I do think there’s an extent to which Abrams will be protected from this tendency by Arndt’s script, and the larger plans of Disney, which will presumably will be thinking about projects like television shows and Zack Snyder’s rumored stand-alone Star Wars movie. But I do think that Abrams’ interests in mysteries are actually a relatively a poor match for the greatest strength of the Star Wars movies: using a mysterious concept to open up a larger world, rather than focusing obsessively on the mystery itself.

But really, the profound disappointment I felt on hearing this news is less about my specific feelings about Abrams as a director. It’s more that franchises like The Avengers, Star Trek, Justice League, and Star Wars are opportunities for writers and directors to exert enormous cultural influence, and to accrue the kind of capital and credibility that can become enormous springboards for their more personal projects. The Avengers, for example, gave Joss Whedon an opportunity to bring his unique spin on female characters to Black Widow, who’d been poorly served in Iron Man 2. And its success won him a long-running and one assumes extraordinarily lucrative position overseeing the franchise: his ideas about superheroism will play a major role in American moviegoing for as much as a decade to come, and the money he makes from it gives him the opportunity to pursue more passion projects like his adaptation of Much Ado About Nothing. That is an extraordinarily precious thing, and it makes me terribly sad to see that power concentrated in one person, rather than spread out to a number of people with different interests and perspectives on the kinds of questions raised by our biggest franchises.

There should be debates about what it means to have extraordinarily powerful people emerge in our society, which is why I’m glad that Zack Snyder’s Man of Steel apparently is going to explore a much more ambivalent reaction to the rise of superheroes than either The Avengers or Christopher Nolan’s Batman movies ever contemplated. There should be arguments about what our future is going to look like, which is one of the reasons Abrams’ Star Trek, which was a dramatic retreat from the socially engaged tradition of the franchise, was a disappointment even as it was highly entertaining. And while Star Wars is a space opera, it’s also always been about totalitarianism, religious extremism, torture, and the moral value of political engagement, too. The source and meaning of mystery isn’t the only issue worth considering. And white, male geek gods aren’t the only people with profound investment in these franchises, and the way they express these questions.


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50 Years Ago Today, JFK Called For Closing A Giant Tax Loophole…But It Still Exists

Our guest blogger is Seth Hanlon, Director of Fiscal Reform at the Center for American Progress Action Fund.

On January 24, 1963, exactly half a century ago, President John F. Kennedy called on Congress to enact a broad overhaul of the tax code. One of JFK’s boldest proposals was to close a giant tax loophole that allows wealthy people to escape taxes on capital gains — the appreciation in value of stocks, businesses, or other investments — by holding onto assets until death and passing them onto heirs.

Though JFK’s successor, Lyndon Johnson, pushed through much of the Kennedy tax program in 1964, the tax break on inherited capital gains survived. It exists to this day as one of the largest loopholes in the tax code.

The provision is sometimes called the “angel of death loophole” or, in tax-speak, the “stepup in basis at death.” Here is how it works: Let’s say an investor buys stock for $1,000 and over time it shoots up in value to $100,000. If the investor sells that stock, he’ll owe capital gains taxes on the amount it has gone up.

But if the investor holds onto the stock his whole life and bequeaths it to his heirs, the $99,000 of gain is never subject to capital gains tax. The heirs inherit the stock with what’s called a “stepped-up basis,” which means that if they sell the stock at some point, they’ll only owe capital gains tax on any gain above $100,000.

The inherited capital gains loophole has major effects on the budget, on the economy, and on tax fairness. It results in about half of all capital gains going permanently untaxed. It costs the U.S. Treasury an estimated $50 billion per year (perhaps more). It encourages people to hold onto assets even when they would otherwise want to sell them. And since capital gains are highly concentrated at the top end of the income scale, it undermines progressivity.

One of the arguments for maintaining the inherited capital gains tax break is that the estate tax provides a backstop, ensuring that large inheritances are taxed. But that argument holds less water now that the estate tax has been largely eviscerated.

In submitting his tax reform proposal to Congress, Kennedy emphasized that eliminating “the ability to avoid all capital gains taxed on assets held until death” would mean that more investors would choose “the most desirable investment[s],” not the most tax-favored ones. JFK’s proposal included a number of exceptions to address practical issues, including exempting the vast majority of people with only modest amounts of capital gains. Unfortunately, however, Congress left the loophole untouched, and subsequent efforts to address it have also come up short.

Fifty years later, Congress is again discussing tax reform, and though the inherited capital gains loophole is one of the largest tax breaks, it is rarely debated. But if Congress is committed to a balanced approach to our fiscal challenges, and serious about “base broadening” tax reform, it should revisit a half-century-old proposal that is more relevant than ever.


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China Is Getting Into The Patent Game For Alternative-Energy Cars

China is trying to get a leg up on the market for clean transportation by bulking up the rate it’s been filing patents. According to a recent report in Europe’s China Daily, China filed over 2,000 patents for alternative-energy cars in 2012, placing it just behind Japan and the United States, and dead even with Germany and South Korea:

With a worldwide push for sustainable, clean transportation, patents are vital to survival in the global new-energy vehicle industry, China Intellectual Property News reported.

China had filed more than 2,000 patent applications – 8 percent of the world total – for new-energy cars by the end of last year to share the third place with Germany and South Korea, according to the statistics from Thomson Reuters.

Japan ranks the first with nearly 9,000 patents, followed by the United States with 4,000, accounting for a respective 60 percent and 22 percent of the world total.

China has actually been in the patent game for sometime. In 2011, the country’s patent office received more applications — for all forms of invention, not just green technology — than any other nation. At the same time, very few Chinese investors seek to patent their ideas abroad — less than 5 percent between 2005 and 2009. Generally speaking, if an inventor has an idea of genuine merit, they’ll seek to patent it as many places as possible. Concentrating merely on China’s office could be an indication that other incentives are driving the patent, such as the chance to snatch up a government subsidy.

The race between various countries to accrue patents in alternative-energy also raises the possibility of “patent wars,” such as those that have riled the world of software. Companies and interests attempt to round up and hoard patents in order to corner sources of revenue. That is, of course, very profitable for them, but it also tends to dampen innovation in the relevant industry. The spread of patents forces companies and inventors to spend ever more time and money making sure every conceptual aspect of the technology they’re working on is in the legal clear, or is properly licensed. That drives up costs for the companies, for consumers, and slows down the creation of new products and technologies that can raise everyone’s well-being — like cars and other forms of transport powered by sustainable energy. It arguably even drives up inequality.

The problem is especially acute in the software world, where it’s especially difficult to organize who has the rights to what into a public and easily-searchable database. But in principle the inefficiencies and transaction costs that come with over-zealous competition for patents can afflict any industry, including green tech and green transportation.

In February of 2011, for example, Butamax Advanced Biofuels, a joint venture between BP and DuPont, sued another advanced biofuels company, Gevo, for infringing their patent on a process to produce microbial-based biofuel.

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Watson Pharma changes name to Actavis Inc.

PARSIPPANY, N.J. -- Watson Pharmaceuticals Inc. said Thursday it has changed its name to Actavis Inc. following its purchase of the Swiss drugmaker in October.

As part of the change, the company's New York Stock Exchange ticker symbol switched to "ACT" from "WPI."

Watson agreed to buy Actavis Group in April for about $5.6 billion. It completed the deal on Oct. 31 and announced the planned name change on that date. The new Actavis is the third-largest generic drug company in the world and has about $8 billion in annual revenue.

Actavis shares rose 86 cents to $86.59 in morning trading. The stock has risen 46.5 percent since rumors about Watson buying Actavis began to circulate in March. The shares have been trading at all-time highs for months, peaking at $91.47 in late December.


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St. Jude Q4 profit, medical device sales decline

ST. PAUL, Minn. -- Troubled medical device maker St. Jude Medical Inc. posted a 4 percent drop in fourth-quarter profit as higher taxes and a drop in sales for most of its products offset tight spending. The company still managed to top Wall Street profit expectations.

The maker of pacemakers, heart-shocking defibrillators and other medical devices has been plagued over the past few years by recalls of wires for several heart devices, and analysts worry another recall could be coming.

The company, based in St. Paul, Minn., said Wednesday that net income was $120 million, or 39 cents per share for the three month-period that ended on Dec. 29, down from $125 million, also 39 cents per share, a year earlier.

Excluding one-time charges totaling 53 cents per share, net income would have been $285 million, or 92 cents per share. The charges include ongoing restructuring charges, litigation costs, an income tax loss related to the settlement of an audit and write-offs for discontinued products.

Analysts surveyed by FactSet were expecting earnings per share of 89 cents, excluding charges.

Revenue totaled $1.37 billion, matching analysts' consensus forecast. Sales were down 2.5 percent, from $1.41 billion in 2011's fourth quarter.

Net income fell despite an 18 percent drop in spending on marketing and administrative expenses, to $451 million.

Sales fell 3 percent to $422 million for the company's best-selling products, heart defibrillators implanted in patients to correct dangerous irregular heartbeats and prevent heart attacks. Pacemaker sales dropped 11 percent, to $260 million.

In the one bright spot in the quarter, sales of products to diagnose and treat the dangerous irregular heartbeat atrial fibrillation increased 10 percent to $239 million.

The company said it expects earnings per share of 91 cents to 93 cents in the first quarter and $3.68 to $3.73 for all of 2013. Those numbers exclude expected restructuring charges.

Last week, analysts said they think the Food and Drug Administration may call for a recall of another heart wire product called Durata. Earlier this month the company said it had received a warning letter from the FDA after agency inspectors found inconsistencies in how the company manufactured and documented defibrillators. The FDA will not allow any new products to be made at the plant making the defibrillators until problems with manufacturing and quality control are fixed.

St. Jude shares lost 5 cents to $39.62 on Wednesday.


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Health Insurance Brokers Prepare Clients For Obamacare Sticker Shock

WASHINGTON, DC - MARCH 27: People participate... WASHINGTON, DC - MARCH 27: People participate in a protest on the second day of oral arguments for the Patient Protection and Affordable Care Act in front of the U.S. Supreme Court building on March 27, 2012 in Washington, DC. Today is the second of three days the high court has set aside to hear six hours of arguments over the constitutionality President Barack Obama's Patient Protection and Affordable Care Act. (Image credit: Getty Images North America via @daylife)

By Dr. Scott Gottlieb, M.D.

A California insurance broker, who sells health plans to individuals and small businesses, told me that she’s prepping her clients for a sticker shock. Her local carriers are hinting to her that premiums may triple this fall, when the plans unveil how they’ll billet the full brunt of Obamacare’s new regulations and mandates.

California is hardly alone. Around the country, insurers are fixing to raise rates by double digits. They’re privately briefing politicians in Washington on what’s in store. Those briefings are leaving a lot of folks up and down Pennsylvania Avenue jumpy.

What’s gives? President Obama, after all, said he’d prevent these sorts of prices. His new health law gave state regulators the power to block premium increases. It even created a federal agency to oversee insurance rates. But these bureaucrats are spectators to the price hikes. They’re mere wallflowers. Even in the bluest of states.

Their silence is the best evidence of who is culpable for the increases. It’s the policymakers. It’s Obamacare. The President is accepting the premium hikes as an allowable consequence of his healthcare policies.

There’s buzz in Washington that to ease the price hikes, the Obama team may slow down some of the most expensive regulations. This might include the law’s mandatory community rating. One approach they’re said to be considering is allowing some of the historically based underwriting to stay in place for a time.

But premiums will still rise because, in the end, everything has a price. The law’s prohibition against traditional insurance underwriting is just one of its costly provisions. Washington can try to force health plans to price insurance below the cost of these mandates. But then the health plans will simply lose money and move out of markets. To keep the insurers whole, and accommodate new rules, the cost of insurance must get re-priced higher. That re-pricing is what’s coming this fall.

This lesson was learned by Massachusetts, after it adopted its own skinny version of Obamacare. To meet the law’s costs, insurers hiked premiums. Massachusetts’s regulators blocked the increases. All the plans reported losses the very next quarter.

This simple economic axiom doesn’t mean the higher premiums were tolerated in Massachusetts, or will be embraced by Washington. What Massachusetts did afterwards is a lesson for where the entire nation is heading under Obamacare.

Massachusetts regulators went after the underlying source of spending – peoples’ use of medical services. First and foremost, that meant taking on the providers. Massachusetts moved to regulate the prices that doctors and hospitals could charge and the kind of services that they could offer. Rates are rising nationally because, like Massachusetts, Obamacare guarantees more free medical services while doing nothing to make the market for these things more efficient, or competitive. Like Massachusetts, some form of price controls is the next political chapter.

The Obama team can’t merely squeeze the insurers. That’s why our political elite will tolerate many of the looming premium hikes. In the end, health plans are mostly just passing along the costs of the underlying services. That’s even truer today now that Washington is directly regulating insurance company profit margins.

To try and get a handle on rising costs, the Obama Administration will start to go after the healthcare providers. The President seemed to hint about all this when he referenced the need to “lower the cost” of healthcare in his inaugural address.

Simply cutting payment rates has consequences, or course. It reduces reimbursement without regard to value or need. But indiscriminate cuts to fixed rate schedules for everything from doctor visits to hospital stays are Washington’s standard approach for sanding down Medicare costs. The Affordable Care Act will institutionalize these same political tactics across the rest of the healthcare market.

This is the next iteration of healthcare reform. Call it Obamacare 2.0. Doctors will become the next bogyman in Washington. The target is already being fixed to their hide. As for the rest of us, our health insurance will become increasingly illusory.

The prices Washington pays for medical services will gradually fall below the rates where things will be readily supplied. That’s the legacy of Medicaid, and increasingly Medicare as well. Don’t worry, though. The medical services that you’ll have a hard time accessing are mostly the stuff you’ll only need if you get really sick.

Dr. Gottlieb is a physician and Resident Fellow at the American Enterprise Institute.


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