3 reasons the next round of budget talks might be easier

Tough issues remain but there have already been some key concessions from both sides
Although Matthew Yglesias says we’ve entered "an era of semi-permanent fiscal policy crisis," there’s still hope to think the next round of budget negotiations — in two months when the U.S. Treasury is unable to borrow money and automatic spending cuts kick in — just might be a little bit easier.
1. The big reason for optimism is that the issue over tax rates is settled. Republican resistance to ever raising taxes on anyone was finally broken earlier this week. Taxes were raised on the wealthiest Americans and will bring in about $620 billion in new revenues over the next decade.
SEE ALSO: 7 inspiring firsts for the 113th Congress
2. House Republicans have already signaled to Democrats that they would consider an overhaul of the tax code — mainly by closing loopholes and limiting deductions — as a way to raise additional revenues to reduce the deficit.
3. President Obama has already offered a major concession on how the government calculates cost of living adjustments to Social Security and other entitlement programs. By moving to a "chained CPI" calculation, analysts predict the government would save more than $100 billion over the next decade.
There are certainly many more complicated and controversial issues to be hashed out, but the seriousness of reaching an agreement in two months might also spur greater cooperation. The "fiscal cliff" was a creation by politicians, not markets, and going over it — as we did for more than a day — really didn’t amount to much. But the next deadline involves the full faith and credit of the federal government. Reneging on our debts would have an immediate punishing effect by the financial markets and possibly throw the entire global economy into crisis.

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The Accidental Congressman: Can a good man survive in Washington?

A new documentary tracks the rise and fall of Ahn "Joseph" Cao, the first Vietnamese-American to serve in Congress
When Ahn "Joseph" Cao won election to the House in 2008, he ticked off a couple of firsts. He was the first Vietnamese-American to serve in Congress. He was also the first Republican in more than 100 years to win election in Louisiana's 2nd Congressional District, which covers nearly all of New Orleans. With zero experience in politics (he was formerly in training to become a priest), the diminutive candidate won election in the heavily Democratic district only because his opponent, William Jefferson, was mired in scandal. When he arrived in Washington, he was known as the Accidental Congressman.
Two years later, Cao was out of a job. His unlikely rise and precipitous fall is the subject of Mr. Cao Goes to Washington, a new documentary from PBS that premiered on Thursday night and will be aired across the country by various affiliates in the coming week. (Watch a trailer below.) The film, directed by Leo S. Chiang, is the story of what happens to a well-intentioned rookie who finds himself thrust into the partisan miasma of Congress.
Cao was always something of an anomaly in the country's halls of power. He told Deborah Solomon at The New York Times that he had joined the Republican Party for its "strong pro-life stance. That alone." His positions on other issues were decidedly liberal, though they were inflected with a religious bent. "I always adhere to what I call 'the politics of the Gospel,'" he told Solomon. "You have to take care of the poor, take care of the widows, visit the sick, help those who cannot help themselves." He crossed GOP orthodoxy multiple times (irritated conservatives kept track of his infractions), and, most egregiously, was the only Republican who voted to pass President Obama's health care bill. The distinction earned Cao the president's affection.
Or so he thought. The health care vote upended Cao's life. Republicans accused him not only of betrayal, but of pandering to his mostly black constituents. Cao then switched his vote to "nay" for the bill's final draft, claiming that the Senate had introduced language that could allow federal money to be used for abortions. His about-face earned him the disdain of Democrats, who claimed that Cao had let Republicans bully him into line. Cao claimed that all his votes were reflections of his conscience and beliefs; his opponents on both sides of the aisle said he reeked of political opportunism. And, when the air is so foggy with cynicism, who knows which side is telling the truth?
Cao was especially disappointed when he discovered that Obama had cut an ad in support of his 2010 opponent, Democrat Cedric Richmond. "From the tone of his campaign I expected something different than the usual political stance," he told Carlo Rotella of The Boston Globe. "I had hoped he was a person who would do the right thing, not the expedient thing." As Rotella notes, "Can he possibly be naive enough to mean this?

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The single dumbest gun-control measure ever proposed

With extraordinary shortsightedness, Connecticut lawmakers want to publicize the addresses of handgun owners
The Connecticut state legislature is about to consider changing the law to make the information and addresses of 170,000 Connecticut handgun owners public. Aside from potentially being unconstitutional on the grounds that such a law would violate (somewhat ironically) the right to privacy first enumerated by the Supreme Court in Griswold v. Connecticut, this proposal would, if passed, prove a boon for criminals, a disaster for unarmed Connecticuters, and would eventually lead to the proliferation of handgun ownership throughout the state.
That was not a typo: I did, in fact, write that the law would most harm people who do not own handguns. Of course, the gun-rights crowd is emphasizing the harm the proposal would do to gun owners' privacy. And they argue that it would put handgun owners in more danger. It's certainly true that the law would invade the privacy of Connecticut residents who own guns. But it wouldn't put them in harm's way. It would actually maximize the utility of owning a firearm — to the detriment of people who don't own guns.
Think about it. What idiot is going to choose to rob a home where he knows the owner is packing heat? Criminals tend to be stupid, but not that stupid. On the contrary, owning a registered handgun would dramatically decrease the likelihood of your home being targeted, all things being equal.
Here's what would happen: Someone, probably some ridiculous newspaper that does not think the consequences through, will FOIA the gun ownership records and publish them online in an easily searchable database. Would-be robbers would then visit this website and figure out which houses do not have residents who own registered handguns. Those will be their targets. In other words, this law would screw the very people it is aimed at protecting: people who do not own handguns.
Civilians will quickly catch on to this logic. It turns out that if you are a civilian and you are worried, you probably are going to want to be on that gun owner list, if only because you do not want to be among the crowd most likely to be targeted. At this point, the proposal’s most perverse consequence of all becomes clear: If this bill becomes law, Connecticut would likely see first-time handgun permit requests and handgun purchases skyrocket as people who never had any reason to desire a gun flock to stores so that criminals will be more likely to leave them alone. And because the proposal exempts rifles, people who already own guns for sporting purposes will also probably head to the store and pick up a handgun that they neither wanted nor needed.
This proposal, which appears to have received almost no critical thought prior to its introduction, is a perfect example of why legislators need to think long and hard about how they seek to regulate firearms. If they do not, ill-conceived proposals are apt to do exactly the opposite of what they were originally designed for. For historical evidence, look no further than the Assault Weapons Ban of 1990. The ban eliminated high-capacity magazines… but only for a limited time. Furthermore, the law grandfathered in all pre-ban magazines and failed to ban their importation in certain circumstances. Thus the number of high-capacity magazines actually increased while the ban was in place.
Additionally, the ban limited supply and, in the wake of the ban, demand skyrocketed. Gun companies like Glock cleverly arranged to have many of the police departments that use Glock trade their old weapons (with their pre-ban magazines) in for new weapons. Glock then resold the old guns and, more importantly, the pre-ban magazines at a considerably higher price, creating a windfall for the company. And then, of course, when the assault weapons ban expired, Glock resumed production.

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Today in business: 5 things you need to know

Regulators clear Google in antitrust probe, Tory Burch becomes a billionaire, and more in our roundup of the business stories that are making news and driving opinion
1. REGULATORS CLEAR GOOGLE IN ANTITRUST CASE
The Federal Trade Commission, after a two-year investigation, has determined that Google didn't violate antitrust laws by delivering search results that highlight its own services. The decision, released Thursday, constitutes a major victory for Google and allows it to avoid a costly and lengthy battle similar to the one Microsoft fought in the 1990s. That antitrust battle helped competitors challenge Microsoft's tech dominance, and now the weakened software giant is among the loudest voices complaining that Google is using its ubiquitous search engine to unfairly squelch competition. [New York Times]
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2. OFFICIAL DATA CONFIRM HIRING HELD STEADY DESPITE FISCAL CLIFF
Labor Department figures released Friday confirmed what private analysts reported this week: Employers shrugged off the looming fiscal cliff in December and continued to gradually hire more workers. Businesses added 155,000 jobs in the month, close to expectations, leaving the unemployment rate essentially unchanged, at 7.8 percent, from revised numbers for November. The new hiring was consistent to the gradual gains posted throughout 2012, which economists said would slowly but steadily bring down the unemployment rate. [Washington Post]
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3. TORY BURCH BECOMES A BILLIONAIRE (ON PAPER)
The former husband of fashion designer Tory Burch has sold nearly half of his 28 percent stake in her company in a deal that makes her a billionaire. Tory and Chris Burch opened their first store in New York in 2004, and divorced two years later. The company, which sells high-end women's clothing and accessories, has since grown into a retail juggernaut, with 80 Tory Burch retail stores and other displays in other outlets, including Neiman Marcus, Nordstrom, and Bloomingdale's. Chris Burch sold off part of his stake to settle the former couple's legal squabble, fetching a price that values Tory Burch's 28-percent stake at $935 million. [Bloomberg]
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4. WHITE HOUSE SIGNS OFF ON OBAMACARE INSURANCE EXCHANGES
The Obama administration on Thursday approved another seven states' plans to set up health-insurance exchanges designed as a key part of President Obama's health-reform law. The White House has now signed off on the plans submitted by 17 states and Washington, D.C. The exchanges will serve as "a kind of Travelocity" to help individuals and businesses find the best deals on health coverage. The exchanges are due to start enrollment on Oct. 1, so consumers will be able to use federal subsidies to buy insurance on the exchanges by Jan. 1. Most states didn't submit plans to run their own marketplaces, so they'll have to either partner with the federal government or let the Obama administration establish their exchanges for them.

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Google's big antitrust victory: What the FTC's decision means for you

An investigation into whether the search giant was unfairly burying competitive sites in its search results ends with Google emerging unscathed
After a lengthy two-year investigation, the Federal Trade Commission elected Thursday not to pursue charges against Google for showcasing its own products in its search results over those of competitive websites. The five-member FTC commission unanimously voted to close its investigation, saying that the search giant, which dominates the U.S. search market with 70 percent of all queries, had not violated antitrust or anticompetition statutes, reports The New York Times. Here's what you should know about the FTC's decision:
What was the FTC after Google for?
Google pretty much has a stranglehold on the search market, but the company also competes in a number of other business arenas, including but not limited to: Maps, restaurant reviews, travel bookings, social networking, email, and more. Appearing higher in Google's search rankings can make or break an online business in terms of web traffic and revenue, and competitors accuse Google of unfairly spotlighting its own services on the first page of results. Microsoft, one of Google's most outspoken competitors, says Google was using its "monopolistic position to thwart rivals," hurting the business of Microsoft-owned properties like Bing and Outlook (formerly Hotmail). Google was also accused of lifting content from websites like Yelp to display information directly in its search results, thereby negating a user's need to leave Google.com.
And what did the FTC decide?
Jon Leibowitz, chairman of the FTC, says that Google's practices, save for a few small infractions, aren't really doing anything to hurt other businesses and aren't damaging enough to warrant further charges. "While not everything Google did was beneficial, on balance we did not believe that the evidence supported an FTC challenge to this aspect of Google's business under American law," he said. Not only does Google get to skip a long and expensive legal war, but the company will also retain the competitive advantage of being able to highlight products like Google+, Maps, Zagat, shopping, Gmail, etc. (For example: A search for "social networks" could place Google+ higher than, say, Facebook.)
Is anything going to change when I visit Google.com?
Nothing too major, at least when it comes to the everyday user experience. To its credit, the company is implementing a new system that allows websites to opt out of having their content "scraped" and displayed in search rankings, as in the aforementioned case of Yelp content. Another small change is Google will now have to license a few of its hardware and software patents it acquired from Motorola Mobility to other phone makers (like Microsoft).
What do tech experts think of the ruling?
Depends on who you ask, but opinions range from Google made out "pretty well" to "this is highway robbery." Tony Romm at Politico says Google escaped with not much more than a "slap on the wrist." Casey Newton at CNET echoes the sentiment while also declaring it a "major victory." In an op-ed for Gizmodo, Scott Cleland slams the ruling as egregious, and say the FTC "screwed up" the investigation completely. "If promising 240 million American consumers unbiased search when routinely and opaquely providing them with biased search is not a deceptive business practice, what is?" asks Cleland. "Is the FTC setting a new precedent here that misrepresentation actually can be net-good for consumers if accompanied with enough ancillary innovation and consumer benefits?"
So clearly Google's competition isn't happy, right?
Not at all. FairSearch.org — a coalition that includes Kayak, Microsoft, Expedia, and a number of other companies — said in a statement that "the FTC's inaction on the core question of search bias will only embolden Google to act more aggressively to misuse its monopoly power to harm other innovators." Yelp, another vocal critic, says the FTC missed an opportunity "to protect innovation in the internet economy, and the consumers and businesses that rely on it."
SEE MORE: Can computer programmers account for morality?
Does this affect the E.U.'s Google investigation?
Nope. "We have taken note of the FTC decision, but we don't see that it has any direct implications for our investigation, for our discussions with Google, which are ongoing," said Michael Jennings, a spokesman for the European Commission.  
How exactly did Google pull out this win anyway?
Essentially, by studying how Microsoft lost its own antitrust probe in the 1990s and vowing not to make the same mistakes. Rather than sit by idly as the FTC carried out its investigation, Google spent $25 million out of pocket to fly its people to Washington and lobby lawmakers. Politico reports:
Instead of ignoring Washington — as rival Microsoft did before its costly monopolization trial in the 1990s — Google spent about $25 million in lobbying, made an effort to cozy up to the Obama administration and hired influential Republicans and former regulators. The company even consulted with the late Robert Bork and The Heritage Foundation and met with senators like John Kerry to make its case. In other words, these traditional outsiders worked the system from the inside.

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Washington saying goodbye to Inouye at memorial

WASHINGTON (AP) — Admirers will bid farewell to Democratic Sen. Daniel Inouye at a memorial service before a final trip home to his native Hawaii.
President Barack Obama and Vice President Joe Biden were to be among those offering tributes during the ceremony Friday at Washington National Cathedral, along with Senate Majority Leader Harry Reid, D-Nev., and Veterans Affairs Secretary Eric Shinseki.
Biden also spoke at a ceremony Thursday at the Capitol, where Inouye was given an honored resting place: beneath the dome.
Inouye was only the 31st person to lie in state in the rotunda, the most recent being former President Gerald R. Ford nearly six years ago.
During the day, congressional staff, tourists and other Capitol Hill visitors filed past to pay their respects at Inouye's casket, draped with an American flag.
Inouye died Monday of respiratory complications. He was 88.
After becoming Hawaii's first congressman in 1959 following statehood, Inouye was elected to the Senate in 1962. He was the first Japanese-American elected to both houses of Congress and was serving his ninth Senate term at the time of his death.
He was awarded a Medal of Honor, the nation's highest military honor, for bravery during World War II, including a heroic effort that cost him his right arm. He later became one of the nation's most influential politicians, playing key roles in congressional investigations of the Watergate and Iran-Contra scandals.
Inouye also was the second-longest serving senator in U.S. history.
As a legislator, his specialty was steering federal money back home to help build the kinds of roads, schools and housing that Americans on the mainland took for granted.
Inouye's body is to be returned to Hawaii on Saturday.

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NRA returns to public debate, to meet with media

WASHINGTON (AP) — One week after the mass shootings that killed 26 people at a Connecticut elementary school — 20 of them children — the nation's largest gun-rights lobby is returning to the spotlight as Congress prepares to consider tighter restrictions on firearms in the new year.
The 4.3 million-member National Rifle Association largely disappeared from public debate after the shootings in Newtown, Conn., choosing atypical silence as a strategy as the nation sought answers after the rampage. The NRA took down its Facebook page and kept silent on Twitter.
Unlike its actions in the wake of other mass shootings, the group did not put out a statement of condolence for the victims while simultaneously defending the rights of gun owners.
That strategy, however, is set to change, starting with a news conference Friday.
In the lead-up, the group re-activated its Facebook account — it has 1.7 million members — and its Twitter feed now warns supporters that "President Obama supports gun control measures, including reinstating an assault weapons ban." The group also announced that its top lobbyist, Wayne LaPierre, planned to appear Sunday on NBC's "Meet the Press" program.
It's an about-face from the group that ignored requests for comment and shunned media attention for four days following last week's shootings.
"The National Rifle Association of America is made up of 4 million moms and dads, sons and daughters and we were shocked, saddened and heartbroken by the news of the horrific and senseless murders in Newtown," the group said in its first public statement since the shootings, released Tuesday. "Out of respect for the families, and as a matter of common decency, we have given time for mourning, prayer and a full investigation of the facts before commenting."
The group also promised "meaningful contributions to help make sure this never happens again" and announced plans for Friday's news conference on what is, in reality, the last real work day before Washington scatters for the long Christmas holiday.
Since the slayings, President Barack Obama has demanded "real action, right now" against U.S. gun violence and called on the NRA to join the effort. Moving quickly after several congressional gun-rights supporters said they would consider new legislation to control firearms, the president said this week he wants proposals on reducing gun violence that he can take to Congress by January.
Obama has already asked Congress to reinstate an assault weapons ban that expired in 2004 and pass legislation that would end a provision that allows people to purchase firearms from private parties without a background check. Obama also has indicated that he wants Congress to pursue the possibility of limiting high-capacity magazines.

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Few memorials to forgotten victim: Gunman's mother

NEWTOWN, Conn. (AP) — When people here speak of the massacre at Sandy Hook Elementary School, they use the number 26: the ones killed after Adam Lanza blasted his way into the school.
When the bells of Newtown toll mournfully Friday morning to honor the victims of last week's shooting rampage, they'll do so 26 times, for each child and staff member killed.
Rarely do residents mention the first person police said Lanza killed that morning: his mother, Nancy, who was shot in the head four times while she lay in bed.
That makes 27.
A private funeral was held Thursday in New Hampshire for Nancy Lanza, according to Donald Briggs, the police chief in Kinston, N.H., where her funeral was held. About 25 family members attended the ceremony.
In Newtown, where makeshift memorials of stuffed animals, angels, candles, flowers and balloons have blossomed on patches of grass throughout town, there is only one noticeable tribute to Nancy Lanza. It's a letter written by a friend on yellow paper affixed, screwed and shellacked onto a red piece of wood.
"Others now share pain for choices you faced alone; May the blameless among us throw the first stone," it reads in part.
No one outwardly blames Nancy Lanza for the rampage. But authorities have said the gunman, her 20-year-old son Adam, used the guns she kept at their home to carry out a massacre that became the second-deadliest school shooting in U.S. history and has stirred lawmakers to call for gun control laws.
Nationwide, churches will ring their bells 26 times at 9:30 Friday morning — exactly a week after the shooting occurred — in memory of the victims. Two gold balloons, one a 2, the other a 6, are tied to a bridge. Handwritten tributes mention 26 snowflakes. "26 angels will guide us," reads one.
The dearth of tributes to Nancy Lanza underscores the complicated mix of emotions surrounding her after the shooting.
In a small town where multiple funerals are taking place each day, where black-clad mourners stand in lines waiting to say goodbye to another child, many are incredibly angry at Nancy Lanza for not keeping her guns away from her son.
Some view her as a victim, but one whose guns were used to kill first-graders. And others think Nancy Lanza was an innocent victim, one who should be counted and included at memorials.
"It's a loss of life and, yes, her life mattered," said Christine Lombardi. "Yes, I do believe she should be included."
Others in Newtown are weary of the crush of media and have become reluctant to answer questions after a difficult week. But the subject of marking Nancy Lanza's death, along with those of the children and teachers killed by her son, seemed mainly to surprise two moms who stopped to place flowers at the memorial at Main and Sugar streets with their two grammar-school aged girls.
They paused, appeared bewildered, and looked at each other for a moment. Then one quietly said, "No, no," and they each took a girl's hand and led them away.
Newtown and environs weathered a fourth day of funerals Thursday as mourners laid to rest Catherine Hubbard, Benjamin Wheeler, Jesse Lewis and Allison Wyatt, all 6 years old; and Grace McDonnell, 7.
A service was held in Katonah, N.Y., for teacher Anne Marie Murphy, 52, who authorities believe helped shield some of her students from the rain of bullets. Roman Catholic Cardinal Timothy Dolan compared her to Jesus.
"Like Jesus, Annie laid down her life for her friends," Dolan said. "Like Jesus, Annie's life and death brings light, truth, goodness and love to a world often shrouded in darkness, evil, selfishness and death."
A bell tolled Thursday at Newtown's St. Rose of Lima Roman Catholic Church at the funeral for Catherine, who her family said would be remembered for her passion for animals and her constant smile.
Trinity Episcopal church on Main Street was filled to capacity for the funeral for Benjamin, described as a budding musician and Beatles fan. His service included a rendition of "Here Comes The Sun." About two dozen Boy Scout leaders lined the front pathway to the church in honor of the former Cub Scout.
In downtown Danbury, mourners filed into the ornate white-pillared First Congregational Church for a memorial service for 30-year-old teacher Lauren Rousseau. Friends wept at the altar as they remembered the spirited, hardworking, sunny-natured woman who brightened their lives with silliness and gave them all nicknames.
Gov. Dannel Malloy has asked people across Connecticut to observe a moment of silence at 9:30 a.m. Friday, which will mark a week since the shootings. The White House has said President Barack Obama will privately observe the moment of silence.
Places of worship and buildings with bells have been asked to ring them 26 times, for the victims at the school. Officials and clergy in many other states have said they will participate.
U.S. Attorney General Eric Holder was one of the people to visit Newtown on Thursday, stopping by a firehouse.
The Obama administration will push to tighten gun laws in response to the shooting, Vice President Joe Biden said Thursday, and Speaker John Boehner said the GOP-controlled House would consider the proposals.
Biden, who is overseeing the administration's response to Friday's shooting, said he and Obama are "absolutely committed" to curbing gun violence in the United States.
"Even if we can only save one life, we have to take action," he said.
Gun-control measures have faced fierce resistance in Congress for years, but that may be changing because of the events in Connecticut, which shocked the nation.
After the shooting, Obama signaled for the first time that he's willing to spend significant political capital on the issue. Some prominent gun-rights advocates on Capitol Hill — Democrats and Republicans alike — have expressed willingness to consider new measures.
Authorities say Adam Lanza shot his mother at their home and then took her car and some of her guns to the school, where he broke in and opened fire. A Connecticut official said Nancy Lanza, a gun enthusiast who practiced at shooting ranges, was shot four times in the head with a .22-caliber rifle.
Lanza was wearing all black, with an olive-drab utility vest, during the attack. Investigators have found no letters or diaries that could explain the rampage.

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France's Hollande reaffirms 2013 deficit target

PARIS (Reuters) - French President Francois Hollande reiterated on Friday that his government was targeting a reduction of the public deficit in 2013 to three percent of GDP despite new official data showing economic growth way below forecast.
Hollande told Europe 1 radio he also expected that French unemployment would only begin to fall by late 2013 despite what he said would be a "difficult year" for the economy.
"There's no recession, not in France," Hollande said. "But it will be difficult because when we have nearly zero growth in the first half of the year, unemployment will keep rising."
The French economy will eke out growth of only 0.1 percent this year, dropping from 1.7 percent in 2011 and missing the government's forecast for 0.3 percent, national statistics office INSEE estimated late on Thursday.
More worrying, INSEE said the outlook would improve only marginally heading into 2013, estimating growth of 0.1 percent in both the first and second quarters.
The weak economic momentum raises the chances the economy will grow less in 2013 than the 0.8 percent forecast the Socialist government has built its budget on.
Asked if he still aimed to cut the deficit to 3 percent of output next year, Hollande said: "That's our target and when you set a target the aim is to reach it."
Hollande's comments came after French employers and trade unions announced overnight that they had failed to reach an accord on labor market reform seen essential to unlocking more growth potential from the euro zone's second largest economy.
The two sides are set to hold new talks starting January 10, extending the initial year-end deadline Hollande originally set for what he said must be an "historic" accord.
"We must not miss this opportunity ... everyone must assume their responsibilities," he said.

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S&P downgrades Cyprus on default fears

NICOSIA, Cyprus (AP) -- Ratings agency Standard & Poor's has downgraded Cyprus further into junk status amid concerns that the country could default on its debts.
It says Friday that the two-notch downgrade to CCC+ is due to a "considerable and rising" risk that the country, one of the 17 EU countries that uses the euro, may default.
It also maintains its negative outlook on the country, meaning that further downgrades are possible.
S&P says it went ahead with the downgrade because the Cypriot government is running out of money while uncertainty remains over the terms of a bailout that the country is trying to negotiate with international lenders to salvage its banks that are heavily exposed to debt-crushed Greece.

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Thursday's Scoreboard

Thursday's Games
NBA
Minnesota 99 Oklahoma City 93
Miami 110 Dallas 95
Portland 101 Denver 93
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AHL
Lake Erie 4 Houston 3
Peoria 5 Charlotte 4 (SO)
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U.S. College Football
Poinsettia Bowl at San Diego
Brigham Young 23 San Diego State 6

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