THE UNIVERSITY DAILY KANSAN
WEDNESDAY, APRIL 2, 2008
NEWS
13A
》 ECONOMY
Senate debates housing crisis
Democrats, Republicans agree to end bickering and work on a bipartisan solution
ASSOCIATED PRESS
WASHINGTON — Under growing pressure from voters to do something about the nation's
home foreclosure crisis, top Senate leaders agreed Tuesday to at least start with a plan that can win the support of both Democrats a nd Republicans
The pact
Committee Chairman Christopher Dodd, D-Conn., and the panel's top Republican, Richard Shelby of Alabama, were instructed to forge a com-
"The mortgage bankers, God bless them, say this is the end of civilization as we know it ..."
SEN. LAMAR ALEXANDER R-Tenn.
between Majority Leader Harry Reid, D-Nev., and Minority Leader Mitch McConnell, R-Ky., ended weeks of partisan bickering over what to do about the crisis in the housing market and the toxic effect it's having on the economy.
There is considerable common ground on several steps that can be taken to improve the situation, but battles over how to structure the debate had threatened to produce gridlock.
Reid agreed not to bring up a Democratic plan containing a controversial provision — strongly opposed by Republicans and President Bush — to give bankruptcy judges power to cut interest rates and principal on troubled mortgages. That plan stalled a month ago.
Instead, Senate Banking
promise by Wednesday afternoon.
The legislation is likely to draw on elements of the Democratic plan such as letting states issue $10 billion in
tax-exempt bonds to refinance subprime loans and permitting homebuilders and other money-losing businesses to reclaim previously paid taxes.
Democrats also want to provide $4 billion to states to buy up and refurbish foreclosed homes, a plan that the administration opposes as a bailout for lenders and speculators.
Senators in both parties gave the arrangement a 94-1 stamp of approval on a previously scheduled procedural vote. Sen. Jim Bunning, R-Ky., was the sole "nay" vote.
The upcoming bill also is sure to attract a GOP amendment by Sen. Johnny Isakson of Georgia to award $15,000 tax credits to people who buy and move into foreclosed homes. That would sharply boost demand, Isakson
says. Lawmakers in both parties support the idea.
The measure is also likely to include a plan by Dodd to have the Federal Housing Administration guarantee perhaps $400 billion worth of refinanced loans if lenders reduce loan amounts to reflect reduced home values. The measure would force banks to make less money
on the loans but would also reduce their credit exposure.
There is also bipartisan backing for $200 million in new money for debt counselors to help
homeowners negotiate with lenders.
tory lending practices, estimates about 600,000 people would keep their homes under Durbin's plan instead of ending up before bankruptcy judges who aren't permitted to adjust mortgage terms, regardless of how onerous they are.
"It would mean higher risk higher interest rates and higher monthly payments."
The hotly contested provision rewriting the bankruptcy code, opponents say, would allow borrowers to effectively rewrite their mortgage contracts and would prompt lenders to tighten their standards and raise interest rates.
A floor battle still looms over whether to change bankrupty laws to help borrowers trapped in subprime mortgages keep their homes. Sen. Richard Durbin, D-III., is the top backer of the idea, which has drawn withering opposition from banks, Republicans and a few Democrats.
Durbin said more than 2 million homeowners face foreclosure by the end of 2009, many of whom were duped into signing mortgages with unfair terms. The Center for Responsible Lending, which combats preda-
SEN. LAMAR ALEXANDER
"It would mean higher risk, higher interest rates and higher monthly payments," said Sen. Lamar Alexander, R-Tenn.
"The mortgage bankers, God bless them, say this is the end of civilization as we know it ... If these people go into court to be able to stay in their homes ... interest rates will go up all over America," he said. "Well, that isn't the case at all."
Tuesday's developments don't guarantee a successful result, but both parties are under great pressure to produce a bill that can pass this year.
ENTERTAINMENT
ASSOCIATED PRESS
Television personality and producer Oprah Winfrey plans to dedicate a show investigating abuses at puppy mills to her cocker spaniel, Sophie, who died last month from kidney failure at the age of 13.
Oprah to air investigation about puppy mills abuses
ASSOCIATED PRESS
CHICAGO — Oprah Winfrey plans to dedicate a show investigating abuses at puppy mills to her cocker spaniel, Sophie, who died last month from kidney failure.
"Sophie gave me 13 years of unconditional love. She was a true love in my life," Winfrey says on the broadcast scheduled to air Friday.
The show features special correspondent Lisa Ling investigating
puppy mills, which Ling calls "hor rific" and "haunting."
Winfrey says the show is "for anybody anywhere who loves a dog, has ever loved a dog, or just cares about their basic right to humane treatment."
SCIENCE
While Sophie was not a product of a puppy mill, and Winfrey's three current dogs were adopted from breeders, Winfrey says in the future she would look to adopt from an animal shelter.
Old corneas transplant as well as newer ones
ASSOCIATED PRESS
It may sound surprising. After all, when it comes to most types of transplants, younger organs and tissue are more coveted — and there has been controversy among corneal surgeons about using older eye tissue, too.
WASHINGTON - Older corneas seem to transplant as well as younger ones, says a major new study that promises to expand the age of cornea donation to 75.
But government-funded researchers randomly assigned cornea recipients to get either younger or older tissue and found the corneas of both groups survived just as well five years later. The study was published Tuesday in the journal Ophthalmology.
"We now have scientific evidence showing that older donors can be used reliably in corneal transplantation," said Dr. Edward Holland of the University of Cincinnati and one of the study's lead researchers.
The cornea is the clear covering for the front of the eye, crucial for helping it focus light. More than 39,000 corneal transplants were performed last year, according to the Eye Bank Association of America.
The nation has had an adequate supply so far. But specialists say there are international shortages, and eye banks fear U.S. supplies will tighten as a result of tougher Food and Drug Administration donor-safety rules that began last summer, increasing interest in older donors.
Transplant surgeons decide how old a cornea they'll accept. Some surgeons, Holland included, have worked with eye banks that accept corneas from donors older than 65. Others banks set younger limits, although age isn't the most important factor. Donors must be in good health, free of various infections — and the corneas must contain enough of a particular cell type, endothelial cells that balance fluid to keep the cornea clear, not cloudy.
To see whether age mattered, the National Eye Institute funded the new work at 80 medical centers. Researchers recruited about 1,000 people who needed new corneas because of two conditions — a swelling known as Fuch's dystrophy and a complication of cataract surgery — that together account for almost half of corneal transplants. Most were in their 60s and 70s, although 12 percent were in their 50s and 3 percent in their 40s.
Participants were divided into two groups, getting corneas either from donors ages 12 to 65 or from those 66 to 75. Then researchers tracked how often the transplant failed, because the cornea was rejected or turned cloudy. Five years later, 86 percent of both groups still had successful transplants.
"There was a bias against older tissue," said co-author Dr. Jonathan Lass of University Hospitals Case Medical Center in Cleveland. "This is going to change our view of that."
There are two caveats:
The study focused on older adults with conditions that put them at medium risk of transplant failure. But about 20 percent of corneal transplants are in younger adults with lower-risk conditions whose transplants seldom fail. The study doesn't address whether a 20-year-old would be OK with a 75-year-old cornea.
Also, Lass led a closer look at the fate of those endothelial cells that keep corneas clear. Those cells normally die slowly with age, at a rate of about half a percent a year during adulthood, he said. For unknown reasons, transplanted corneas rapidly lose many of those cells in the first year before the rate of loss slows again.
Holland, however, contended the study results should apply to all ages.
While there still are some questions about transplants in the young, the study does provide strong support for wider use of older corneas, said Dr. Thomas Steinemann, a cornea specialist in Cleveland and spokesman for the American Academy of Ophthalmology.
Using a special camera to count the cells, Lass found that older transplanted corneas did lose slightly more endothelial cells — 75 percent loss in older corneas over five years and 69 percent loss in younger ones. The difference wasn't statistically significant, nor was there any difference in cloudiness between the two groups. Lass stressed. Still, the researchers will track patients for five more years to watch for late differences.
Wall Street enjoys big rally
》 ECONOMY
a recovery in bank and brokerages to lead major stock indexes higher. Some of the biggest financial players had their sharpest moves of the year Tuesday — Citigroup Inc. shot up 11 percent, JMorgan Chase & Co. rose 9 percent, and Lehman surged 18 percent.
ASSOCIATED PRESS
NEW YORK - Wall Street began the second quarter with a big rally Tuesday as investors rushed back into stocks, optimistic that the worst of the credit crisis has passed and that the economy is faring better than expected. The Dow Jones industrials surged nearly 400 points, and all the major indexes
shares to help bolster their balance sheets. With that upbeat news and a fresh quarter ahead of them, investors appear quite willing to make some bets that the worst of the damage from the nation's credit struggles has been felt. Moreover, the banks' moves buttressed the view that financial services companies are taking aggressive action to improve their capital bases and stave off the potential of a collapse similar to Bear Stearns Cos.
"The extreme conditions we've seen here over the past few months has been missing that confidence ... but that appears to be changing, and we're seeing the response."
"Investors have a difficult time making decisions about the stock market if they don't have confidence in major financial institu-
Analysts believe there must be
RICHARD CRIPPS Chief market strategist
Financial stocks were among the big winners after Lehman Brothers Holdings Inc. and Switzerland's UBS AG issued new
indexes were up more than 3 percent.
tions, so there's been a lot of sideline cash," said Richard Cripps, chief market strategist for Stifel Nicolaus. "The extreme conditions that we've seen here over the past few months has been missing
Meanwhile, Wall Street got another boost when the Institute for Supply Management said its March index of national manufacturing activity rose to a reading of 48.6 — indicating a contraction, but a slower one than in February and tamer than many analysts had predicted. Government data on construction spending for
hissing that confidence ... but that appears to be changing, and we're seeing the response."
The Dow rose 391.47, or 3.19 percent, to 12,654.36. It marked the eighth-biggest point gain ever for the Dow, and the third time in two weeks it came close to or surpassed 400 points.
Broader stock indicators also gained sharply. The Standard & Poor's 500 index rose 47.48, or 3.59 percent, to 1,370.18 — the index's best start to a second quarter since 1938. And, the Nasdaq composite index rose 83.65, or 3.67 percent, to 2,362.75.
The advance was in contrast to a lackluster session on Monday, where stocks managed a moderate gain in the final session of a dismal first quarter. Major indexes ended the first three months of 2008 with massive losses, marking the worst period since the third quarter of 2002 when Wall Street was approaching the lowest point of a protracted bear market.
February also came in better than expected.
Renewed enthusiasm that the credit crisis might be waning was also felt in the Treasury market, where government securities fell as investors withdrew money to take bets on stocks. The 10-year Treasury note's yield, which moves opposite its price, rose to 3.55 percent from 3.43 percent late Monday. The yield updied to 3.56 percent in after-hours trading.
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