A federal jury in Manhattan in the U.S. Oil-for-Food kickback trial of Oscar Wyatt, Jr., heard about unofficial talks with Iraqi officials after the 9-11 attacks. Documents introduced in the Houston oilman's trial show a businessman implicated in the scandal-ridden program claims he facilitated unofficial attempts at diplomacy between senior U.S. and Iraqi government officials after the attacks. Iraqi-American oil trader Samir Vincent is an associate of Wyatt's who sometimes accompanied Wyatt to meetings with Iraqi officials. He says former Housing Secretary Jack Kemp approached him October 31st, 2001. He says Kemp asked that he carry a message to Iraq's foreign minister, Tariq Aziz, from Secretary of State Colin Powell. The message, Vincent wrote in documents introduced during the trial, was that the United States was willing to loosen economic sanctions if Iraq would again welcome U.N. weapons inspectors into the country. Wyatt is accused of paying millions of dollars in kickbacks to Saddam Hussein's regime in exchange for lucrative contracts awarded through the Oil-for-Food program. Wyatt's trial is expected to last several weeks.
There's a sharp warning from a Yale University economist about the real estate downturn and a recession. Robert Shiller, who has long predicted the bursting of this decade's housing market bubble, says conditions could spiral and become "the most severe since the Great Depression.'' He's telling a Congressional committee that could lead to a recession. While he sees a "significant risk'' within the next year, Shiller said actions by the Fed will lessen the severity. His comments come a day after the Federal Reserve responded to the credit market turmoil by slashing the target federal funds rate by a half point to 4.75 percent. Meanwhile, the director of the Congressional Budget Office is giving a more tempered forecast. Peter Orszag is predicting financial market turmoil and weakened consumer confidence, and says they "could pose serious economic risks'' that are difficult to predict.
Treasury Secretary Henry Paulson is warning that the government is about to hit the ceiling--its current debt ceiling. Paulson tells Congress the current debt limit will be reached on October 1st--the start of the fiscal new year. He's urging quick action to increase the limit, saying it's essential to protect the "full faith and credit'' of the country. The current debt limit is $8.965 trillion. Unless Congress votes to raise that ceiling, the country would be unable to borrow more money to keep the government operating and to pay debt obligations coming due. The Senate Finance Committee earlier this month approved increasing the limit on the national debt to $9.82 trillion. That boost of $850 billion would be the fifth increase in the government's borrowing limit since President Bush took office in 2001.
Two of the Senate's top budget hawks have gotten together to launch a bipartisan bid aimed at taming the deficit. The deficit is expected to skyrocket in coming years because of spiraling spending on federal retirement programs. The Budget Committee's chairman and its top Republican, Kent Conrad of North Dakota and Judd Gregg of New Hampshire, want to create a 16-member study group. It would develop recommendations on how to rein in the red ink. Both the House and Senate would have to approve the idea for the task force to come together, and its initial chances seem mixed at best. With the looming election year killing any chance for politically painful steps to reduce the deficit, the group wouldn't issue recommendations until after a new president is elected. A spokesman for Senate majority leader Harry Reid is cool to the proposal, saying it doesn't include enough opportunities for public comment.
Shell Oil has begun evacuating non-essential personnel in the Gulf of Mexico, based on the potential development of Tropical Disturbance #50. Evacuations from drilling rigs and producing platforms began Tuesday with the first 300 workers, and 400 more were evacuated on Wednesday. Production has not been impacted.
The Houston Minority Business Council's EXPO 2007 last week at the George R. Brown Convention Center was the largest in the HMBC's 31-year history. More than 2,500 people visited some 225 booths. United Space Alliance and CenterPoint Energy received Corporate Commitment awards, and Halliburton was the 2007 recipient of the Innovation award. Suppliers of the Year were TURKCO, B. Bell Builders and GHG Corporation. A Professional Services award went to the University of Texas M.D. Anderson Cancer Center. Jewel Smith with CenterPoint Energy was named the 2007 Professional Services Advocate of the Year. The Prime Supplier award went to United Space alliance; Strategic Teaming award went to Managed Digital Documents; and Advocate of the Year awards went to Carmyn Williams-Watkins with the UT Health Science Center and Jewel Smith with CenterPoint Energy.
Contract negotiations between General Motors and the United Auto Workers union enter their fifth day under an hour-by-hour contract extension. Progress has been slow but negotiators are said to be optimistic. A person briefed on the talks says officials are hammering out details of a major health-care agreement as well as changes to plant work rules. The UAW president and his bargaining team have sent a letter to local union leaders saying they may set a firm deadline for a walkout if negotiations don't accelerate. The old contract ran out at midnight last Friday and has been extended hourly while talks continue. That means GM workers could strike at any time. The union letter says there are still differences on several major issues. A deal with GM would set a precedent for contracts with Ford and Chrysler, although specific issues with those carmakers could require changes. Ford is in the worst financial shape of the big three. And Chrysler has a new private owner.
The UAW may establish a firm deadline if contract talks with GM don't accelerate. Union President Ron Gettelfinger and his bargaining team made that statement to local union leaders in a letter Monday night. The Associated Press has obtained their letter, which says progress has been made "in many areas of the discussions with GM but there are several major issues separating the parties that must be resolved.'' GM spokesman Tom Wickham would not comment on the UAW letter. Workers could strike at any time because they've been extending their contract on an hour-by-hour basis. UAW Local 276 represents 2,800 workers at Arlington's GM plant and 2,700 retirees.