The News in 2 Minutes

From The Associated Press

Congress overrides veto of Medicare payment bill

WASHINGTON D.C.—Congress on Tuesday rejected President Bush’s veto of legislation protecting doctors from a 10.6 percent cut in their reimbursement rates when treating Medicare patients.

The override vote in the House was a lopsided 383-41, easily meeting the two-thirds threshold needed to nullify the president’s veto. About an hour later, the Senate voted to override, 70-26.

Bush has vetoed bills nine times, and Congress has had the muscle to override him only on a water projects bill and twice on farm legislation.

The president said he supported rescinding the pay cut, but he objected to the way lawmakers would finance the plan, which would be largely by reducing spending on private health plans serving the elderly and disabled.

Lawmakers were under pressure from doctors and the elderly patients they serve to void the rate cut, which kicked in on July 1. The cut is based on a formula that establishes lower reimbursement rates when Medicare spending levels exceed established targets. About 600,000 doctors treat Medicare patients.

Arizona to consider future of AIMS test

PHOENIX—A last-minute addition to the state budget could lead to a possible revamp or replacement of AIMS, short for Arizona Instrument to Measure Standards. Also a possibility: elimination of the current requirement that students pass the high school version of the math, reading and writing exam to graduate.

The legislation creates a task force of experts to consider testing alternatives, including the possibility of using a national college admissions exam, and the high school graduation requirement. It also limits the state’s next contract with the test provider to one year.

Rep. Rich Crandall, a Mesa Republican who got the provision added to the budget, said Tuesday he hopes the task force produces recommendations in time for lawmakers to consider possible changes in the 2009 regular session.

Crandall said he believes it would be better to replace the graduation requirement with high-stakes promotion requirements for lower grades. Denying diplomas comes too late, he said.

The previously unheralded AIMS legislation was added to a budget education bill (HB2011) during a Senate floor session in the early morning hours of June 26. The House approved the budget without any changes that evening, and Gov. Janet Napolitano signed it into law the next day.

GM makes historic cuts in struggle to survive

DETROIT—General Motors Corp., struggling to survive, will slash jobs, cut production, sell assets and suspend its dividend for the first time in 86 years as it tries to ride out an unprecedented collapse of its core U.S. market.

Tuesday’s actions, which the company said will save $15 billion through 2009, carry a more urgent tone than past roadmaps to recovery. This time, GM is facing one of the most serious threats in its nearly 100-year history, with one analyst speculating that the world’s largest automaker by sales could wind up seeking bankruptcy protection.

GM said if it’s latest, unoptimistic predictions hold true, it will have enough cash to sustain itself to 2010. But with no guarantee that the economic slump and U.S. sales downturn have hit bottom, the latest addition to a long string of restructuring efforts may not be enough to keep GM from going the way of Studebaker.

While the emphasis is on cuts, GM is preserving funding to develop new small cars and car-based crossover vehicles that people are craving as they abandon pickups and sport utility vehicles. There’s also money for vehicles of the future like the Chevrolet Volt rechargeable electric car.

“The company said it would cut white-collar costs in the U.S. and Canada by more than 20 percent, shed thousands more factory jobs by cutting truck production, borrow $2 billion to $3 billion and take other measures such as selling assets to generate cash.

FDIC chair: deposits in nation’s banks are safe

WASHINGTON D.C.—The nation’s banking system is “absolutely safe” and Americans’ insured deposits in banks protected, the head of the Federal Deposit Insurance Corporation said Tuesday.

“Insured deposits are absolutely safe,” Sheila Bair, FDIC chairwoman, said in an interview on CBS’ “The Early Show.” ‘’The banking system as a whole is absolutely safe.”

The FDIC insures bank deposits of up to $100,000 and up to $250,000 for funds in retirement accounts such as an IRA.

Bair said that while there will likely be more bank closings — like that of IndyMac Bank, which last week became the largest regulated thrift to fail — they won’t occur on a large scale and should be put in “appropriate context.”

“There are 8,500 banks,” Bair said. “This is one.”

“We’ve had five bank closings this year,” Bair said. “I won’t say that banks don’t have challenges right now. They do.” But, she noted, “No insured depositor has ever lost a penny of insured deposits throughout the FDIC’s 75-year history.”

100,000 Catholics gather for youth event in Sydney

SYDNEY, Australia—More than 100,000 Roman Catholic pilgrims from around the world swarmed Sydney Harbor on Tuesday, waving the flags of their countries and singing as they awaited a Mass opening the six-day World Youth Day festival.

The star of the show, Pope Benedict XVI, remained ensconced at a retreat on Sydney’s outskirts where he was resting before joining the celebrations Thursday.

The scale of World Youth Day was revealed when pilgrims arrived in droves and gathered along a waterfront near the city’s landmark harbor bridge for a twilight Mass.

Rites, including the Holy Communion, hymn singing and a sermon delivered by Sydney’s Archbishop Cardinal George Pell, left many in tears.

Nearly 250,000 people registered for World Youth Day, more than half from overseas. By Tuesday’s opening ceremony, they had arrived — thousands of young people were staying in churches, schools and volunteers’ homes. They thronged the city with their official yellow, red and orange backpacks, singing songs, strumming guitars and shouting greetings to strangers on the streets.

Release denied for dying Manson follower

SACRAMENTO, Calif.—A follower of Charles Manson who is dying of brain cancer has been denied release from a California prison.

The state parole board on Tuesday denied a request for the compassionate release of Susan Atkins. She stabbed actress Sharon Tate to death nearly 40 years ago.

Her doctors and prison officials made the request in March because of her deteriorating health. Her attorney and husband says the 60-year-old Atkins also has had her left leg amputated and is partially paralyzed.

He says doctors have given her three months to live. Atkins did not attend Tuesday’s hearing.