U.S. Trade Deficit Widens, But Exports Cease Slide

The release of the official U.S. trade balance numbers Thursday showed a wider deficit in August, unsurprisingly driven by the disparity with the country's biggest trade partner, China.

The Commmerce Department said the trade gap expanded to $46.3 billion in August, up 8.7% from July and 49% from a year ago. Dissecting the numbers shows the deficit in goods increased $3.9 billion to $59 billion, while the surplus on the services side edged up $100 million, to $12.6 billion. The trade deficit with China totaled $28 billion, up from July's $25.9 billion.

US dollar continues to weaken

The US dollar is continuing to subside on the back of more gloomy economic news concerning the American economy.

America's trade gap with China hit a new record in August as the country's trade deficit rose by nearly 9 per cent to more than $46 billion.

A slight monthly increase in US exports was more than offset by imports of consumer goods and foreign oil.

The US dollar weakened further on the back of a labour department report showing an unexpected jump in the number of Americans filing for unemployment benefits.

The Australian dollar hit 99.93 US cents late last night.

Analysts say the dollar is under pressure as speculation grows about the likelihood of further intervention by the US federal reserve.

The Greenback is trading at parity with the Canadian dollar and close to parity with the Australian dollar.

Obama's campaigning blitz: It's about 2012, too

WASHINGTON: Republicans are poised to topple at least a dozen Democratic governors next month, and that could cause President Barack Obama and his party major headaches far beyond this year's elections.

A cadre of new GOP governors, including some in battleground states that Obama won two years ago, could complicate his efforts to deliver benefits to voters and campaign effectively in 2012. They could also help create Republican-friendly House seats in next year's once-a-decade redistricting process.

In the final weeks of this year's contest, Obama is campaigning hard for Democrats coast to coast, well aware of the worrisome signs for the future. So far, his results seem mixed, and some candidates seem wary of him.

Democrats are at risk of surrendering governorships in Ohio, Pennsylvania, Michigan, Illinois, Wisconsin, Iowa, Oregon, New Mexico and Maine, among others. Obama carried all those states under Democratic governors in 2008. And all will be competitive in a 2012 re-election contest except, presumably, his home state of Illinois.

Republican governors already have replaced Democrats in New Jersey and Virginia, states that Obama also carried two years ago.

Elsewhere, Democrats are struggling to win a once-promising gubernatorial race in Florida, another swing state that has proven crucial in presidential races. Democrats might replace GOP governors in California, Hawaii and a few others states this fall. But Minnesota is the only state in that category that seems likely to be seriously contested in the 2012 presidential race.

As Obama tries to help Democratic congressional and gubernatorial candidates, he often visits states that will be vital to his re-election hopes. This year he has traveled four times each to Florida, Michigan and Wisconsin, five times to Pennsylvania, and six times to Ohio, where he plans to campaign again this weekend in Cleveland and Columbus.

The president's schedule "is driven entirely by how to best help Democrats in 2010," said White House communications director Dan Pfeiffer. He said it's not surprising that competitive states this year will also be competitive in 2012.

Next month's governors' races also have big implications for U.S. House elections from 2012 through 2020. The House's 435 seats are reapportioned every decade, after each census. States will redraw their districts next year in a process that often is intensely political, with borders crafted to help or hurt a party, or even a particular politician.

Most governors have extensive power to influence the process, including the right to veto plans they dislike. That means Obama could face a more Republican-leaning House in 2013 if he wins re-election.

The redistricting process will be especially brutal in states whose sluggish population growth will cost them House seats. Newly drawn maps can determine which party's incumbent is tossed out. These states include Ohio, Pennsylvania, Illinois, Iowa and Michigan, where Democrats risk handing the governors' seats to Republicans next month. New Jersey also will lose a House seat.

In all, states that Obama carried in 2008 are projected to lose a net of seven House seats. That means those states will award seven fewer Electoral College votes than they did two years ago.

Perversely, perhaps, there could be some good news for Obama in the Republican landslide that many foresee next month. If Republicans take over the House, voters may hold them partly responsible for government impasses and shortfalls. Obama might be able to use a Republican-run House as a political foil, just as Bill Clinton did in his 1996 re-election, two years after his party suffered devastating congressional losses.

In the immediate future, it's unclear how much Obama can help his party's gubernatorial candidates. Some, like Ohio Gov. Ted Strickland, have embraced the president, saying the partnership helps their states.

But Florida Democratic nominee Alex Sink has generally avoided Obama during presidential visits. In a TV ad, she said Republican nominee Rick Scott "seems to think running for governor is all about President Obama," whereas she is focused on Florida schools, jobs and tax relief.

Without question, governors can help their party's president or presidential nominee.

They can tout the administration's policies on issues such as stimulus spending, which might include well-publicized public works projects that create jobs. Conversely, a governor can criticize and fight a president's initiatives, undermining his success.

In New Jersey, Republican Gov. Chris Christie recently canceled construction of a $9 billion rail tunnel connecting his state and New York City, a priority for Obama. Under White House pressure, Christie has since agreed to rethink the decision.

As leaders of their state political parties, governors also can steer resources to a presidential campaign that the out-of-power party may have trouble matching. In pivotal states such as Ohio and Pennsylvania, for example, Obama benefited from hands-on help in 2008 from governors Strickland and Ed Rendell - even though both men originally supported Hillary Rodham Clinton.

Now Obama faces the prospects of running in Ohio, Pennsylvania, Michigan, New Jersey, Iowa, Maine and other states where new governors and their political apparatus will seek to defeat him.

"The stakes for the White House in the governors' races couldn't be higher," said Chris Kofinis, a Democratic strategist who has worked with presidential and gubernatorial campaigns.

The White House's Pfeiffer said "winning the governorship of a state is always helpful for the presidential election," but he noted that Obama carried several states with GOP governors in 2008.

And what of the tea party two years from now? Pfeiffer said those libertarian-leaning candidates may help Republicans win races this year but might prove too extremist for "the broader electorate that turns out in presidential election years."

"People rarely ride tigers without getting bit," Pfeiffer said.

Jury awards tourists $650K in Katrina jail suit

A federal jury in New Orleans has awarded more than $650,000 to two Ohio tourists arrested for public drunkenness and jailed for more than a month in the chaotic days after Hurricane Katrina.

The jury concluded Thursday that Orleans Parish Sheriff Marlin Gusman falsely imprisoned Robie (RAH'-bee) Waganfeald and Paul Kunkel Jr. They also found that one of Gusman's chief deputies violated their constitutional rights by not allowing them to use a phone.

The men claimed they were illegally held in inhumane conditions after the jail flooded. They asked the jury to award them more than $1.3 million.

A lawyer for Gusman says the sheriff's office did an outstanding job caring for and protecting inmates during the 2005 storm's aftermath.

Commonwealth Games closing ceremony includes a game of tag – and lots of security

New Delhi

Just as New Delhi was starting to get used to the rhythm of life as host of the Commonwealth Games, the party has wound down.

The closing ceremony of the 19th Commonwealth Games began Thursday in spectacular fashion at the Indian capital's Jawaharlal Nehru stadium.

Commemorations started with a celebration of traditional Indian sports such as kabbadi, which is essentially an evolved version of tag.

Spectators, however, could be forgiven for confusing such sports with combat training, as thousands of knife- and spear-wielding warrior-dancers and fire-twirlers moved around the grounds.

And, much like the opening ceremonies, an estimated crowd of 60,000 people was watching it all from the stands.

The creative director of the spectacle was filmmaker Bharatbala, who planned the ceremonies for 18 months. The combined cost of the opening and closing ceremonies was said to be in the region of $67 million. Some 6,000 performers took part.

Security, as expected, was extremely tight, not just at the stadium but across Delhi. In fact, Thursday was a public holiday in the city, with most markets, shops, offices, schools, and bars and restaurants closed. Authorities were keen to avoid tempting fate by allowing gathering places for crowds. Road traffic in central New Delhi was restricted.

There were about 7,500 security personnel at the stadium, while snipers, commandos, and specially trained paramilitaries were in place.

Sri Lankan President Mahinda Rajapaksa was the guest of honor at the closing ceremony – something that has raised the hackles of many Tamils. More than 100 people were arrested Thursday in the southern state of Tamil Nadu after staging a protest against Rajapaksa's presence. They said that India should take a firmer stance against the Sri Lankan government over alleged human rights violations against the island nation's Tamil population during the long-running civil war.

But Tamil Nadu is far from New Delhi, where residents are now either heaving a sigh of relief that normal life can resume, or lamenting the end of the biggest – and most chaotic – party the city has ever known.

Nobel winner's wife hopes to collect his award

BEIJING — The wife of the imprisoned Chinese dissident Liu Xiaobo said she hopes to travel to Norway to collect the Nobel Peace Prize on his behalf, though for now she can only leave her Beijing home under police escort.

China, meanwhile, called the award an attack on the country and an attempt to change its political system, and retaliated by canceling another set of meetings with the Norwegian government.

In brief interviews by phone Tuesday, Liu Xia said her husband has started receiving better food since the Oslo-based Nobel committee announced the award last Friday — honoring his more than two decades of advocacy of human rights and peaceful democratic change that started with the demonstrations at Beijing's Tiananmen Square in 1989.

The 54-year-old literary critic is now in the second year of an 11-year prison term after being convicted of inciting subversion over his role in writing an influential 2008 manifesto for political reform.

"He said he hoped I could receive the award on his behalf," Liu Xia told The Associated Press. However, she said she was not optimistic about her chances of leaving since she has been placed under virtual house arrest since the award was announced.

"At this point, I can't even get out of my own house door, let alone the gates of the country," she said, adding that she has not been allowed to meet with friends or journalists and police escort her every time she goes outside her home.

China has been infuriated by the prize, accusing other countries Tuesday of using the award to attack Beijing and warning that it won't change the communist nation's political course.

"If some people try to change China's political system in this way, and try to stop the Chinese people from moving forward, that is obviously making a mistake," said Foreign Ministry spokesman Ma Zhaoxu. "This is not only disrespect for China's judicial system, but also puts a big question mark on their true intentions."

Asked whether Liu Xiaobo would be allowed to collect the award Dec. 10 in Oslo, Ma would only respond by saying that it is "up to judicial authorities."

He also refused to answer questions about Liu Xia's treatment, even saying at first that he did not know who she was. Liu Xia has not been formally charged with any crime but 'soft detention' is a common tactic used by the Chinese government to intimidate and stifle activists and critics.

Beijing said that it relations with Norway's government would suffer because of its backing of the award, although the Nobel committee acts independently.

China canceled a second meeting between visiting Norwegian Fisheries Minister Lisbeth Berg-Hansen and a senior Chinese official, leading her to scrap the Beijing leg of her trip, Norway's Foreign Ministry spokeswoman Raghnild Imerslund said.

By supporting "the wrong decision of the Nobel committee, the Norwegian government has moved to hurt bilateral relations," Ma said. "There is every reason for the Chinese people to be unhappy."

Chinese authorities allowed the dissident and his wife a brief, tearful meeting in prison Sunday. But Liu Xia said since her return, guards have been posted outside her apartment and she is not allowed to receive visits from anyone other than her two brothers. Many of her friends, even some outside Beijing, were under house arrest too, she said.

"I am not allowed to meet the press or friends. If I have to do any daily chores, like visiting my mother or buying groceries, I have to go in their (police) car," said Liu Xia, who was using a new cell phone brought to her by a brother — after police rendered her old one unusable. The new phone has since been disconnected as of Tuesday night.

She said she was entirely reliant on the Internet to keep in touch with friends, and had received no explanation for the restrictions nor any indication of when they would be lifted.

Coughing occasionally, the soft-spoken poet sounded tired and said she was running a low fever, which she blamed on a lack of rest. But she remained hopeful that the restrictions would be lifted soon.

"I believe they won't go on like this forever and that there will be positive change," she said. To China, she said: "You're such a big government, you should have the courage to face this reality."

Devine intervention: six-figure earners jailed for million-dollar fraud

Two senior executives working for construction giant Devine Limited have been jailed for defrauding the company of almost $1 million - then using the cash to buy luxury cars, investment properties and holidays.

In Brisbane District Court this morning Sam Bucolo and Tony McSwaine pleaded guilty to sending bogus invoices to Devine Constructions, a subsidiary of the publicly listed Devine Limited.

Both the Brisbane men worked for the subsidiary company.

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Bucolo was a construction manager on $220,000 a year and McSwaine was a commercial contracts manager on $270,000 a year, with the pair receiving almost $500,000 more in bonuses since starting with the company in January 2005.

The court heard the pair fleeced $929,298 by signing off on a total of eight fake invoices between April 2007 and February 2008.

The bills were for work the company had not done on Charlotte Towers in Brisbane and the construction of a building called ICB at Herston.

The money was spent on furniture, landscaping, investments, purchasing an investment property and overseas holidays, Crown prosecutor Jacob Robson said.

Court documents showed four prestige motor vehicles - a H3 Hummer, a Mercedes 200, an Audi TT coupe and a Commodore SS utility - were also purchased.

Mr Robson said the fraud went unnoticed until a Devine accountant noticed irregularities and looked into the company sending the invoices.

While its directors were listed as the men's wives using their maiden names, the two men were in control of the company and made all decisions relating to its activities, the court heard.

When the fraud was discovered, Devine fired both men.

Defence barrister Tony Glynn said McSwaine, a father of four, had suffered from severe alcoholism for many years and since 2002 had also suffered from anorexia, as well as obsessive compulsive disorder and depression.

He had lost his career and "simply cannot get a position" in the construction industry, he said.

Defence barrister Peter Davis, for Bucolo, said his client took part in the fraud because he was "motivated to do the best" for his family.

But he said his client had lost his marriage and custody of his daughter due to his offending.