New Taxes to Take Effect to Fund Health Care Law

WASHINGTON — For more than a year, politicians have been fighting over whether to raise taxes on high-income people. They rarely mention that affluent Americans will soon be hit with new taxes adopted as part of the 2010 health care law.

The new levies, which take effect in January, include an increase in the payroll tax on wages and a tax on investment income, including interest, dividends and capital gains. The Obama administration proposed rules to enforce both last week.

Affluent people are much more likely than low-income people to have health insurance, and now they will, in effect, help pay for coverage for many lower-income families. Among the most affluent fifth of households, those affected will see tax increases averaging $6,000 next year, economists estimate.

To help finance Medicare, employees and employers each now pay a hospital insurance tax equal to 1.45 percent on all wages. Starting in January, the health care law will require workers to pay an additional tax equal to 0.9 percent of any wages over $200,000 for single taxpayers and $250,000 for married couples filing jointly.

The new taxes on wages and investment income are expected to raise $318 billion over 10 years, or about half of all the new revenue collected under the health care law.

Ruth M. Wimer, a tax lawyer at McDermott Will & Emery, said the taxes came with “a shockingly inequitable marriage penalty.” If a single man and a single woman each earn $200,000, she said, neither would owe any additional Medicare payroll tax. But, she said, if they are married, they would owe $1,350. The extra tax is 0.9 percent of their earnings over the $250,000 threshold.

Since the creation of Social Security in the 1930s, payroll taxes have been levied on the wages of each worker as an individual. The new Medicare payroll is different. It will be imposed on the combined earnings of a married couple.

Employers are required to withhold Social Security and Medicare payroll taxes from wages paid to employees. But employers do not necessarily know how much a worker’s spouse earns and may not withhold enough to cover a couple’s Medicare tax liability. Indeed, the new rules say employers may disregard a spouse’s earnings in calculating how much to withhold.

Workers may thus owe more than the amounts withheld by their employers and may have to make up the difference when they file tax returns in April 2014. If they expect to owe additional tax, the government says, they should make estimated tax payments, starting in April 2013, or ask their employers to increase the amount withheld from each paycheck.

In the Affordable Care Act, the new tax on investment income is called an “unearned income Medicare contribution.” However, the law does not provide for the money to be deposited in a specific trust fund. It is added to the government’s general tax revenues and can be used for education, law enforcement, farm subsidies or other purposes.

Donald B. Marron Jr., the director of the Tax Policy Center, a joint venture of the Urban Institute and the Brookings Institution, said the burden of this tax would be borne by the most affluent taxpayers, with about 85 percent of the revenue coming from 1 percent of taxpayers. By contrast, the biggest potential beneficiaries of the law include people with modest incomes who will receive Medicaid coverage or federal subsidies to buy private insurance.

Wealthy people and their tax advisers are already looking for ways to minimize the impact of the investment tax — for example, by selling stocks and bonds this year to avoid the higher tax rates in 2013.

The new 3.8 percent tax applies to the net investment income of certain high-income taxpayers, those with modified adjusted gross incomes above $200,000 for single taxpayers and $250,000 for couples filing jointly.

David J. Kautter, the director of the Kogod Tax Center at American University, offered this example. In 2013, John earns $160,000, and his wife, Jane, earns $200,000. They have some investments, earn $5,000 in dividends and sell some long-held stock for a gain of $40,000, so their investment income is $45,000. They owe 3.8 percent of that amount, or $1,710, in the new investment tax. And they owe $990 in additional payroll tax.

The new tax on unearned income would come on top of other tax increases that might occur automatically next year if President Obama and Congress cannot reach an agreement in talks on the federal deficit and debt. If Congress does nothing, the tax rate on long-term capital gains, now 15 percent, will rise to 20 percent in January. Dividends will be treated as ordinary income and taxed at a maximum rate of 39.6 percent, up from the current 15 percent rate for most dividends.

Under another provision of the health care law, consumers may find it more difficult to obtain a tax break for medical expenses.

Taxpayers now can take an itemized deduction for unreimbursed medical expenses, to the extent that they exceed 7.5 percent of adjusted gross income. The health care law will increase the threshold for most taxpayers to 10 percent next year. The increase is delayed to 2017 for people 65 and older.

In addition, workers face a new $2,500 limit on the amount they can contribute to flexible spending accounts used to pay medical expenses. Such accounts can benefit workers by allowing them to pay out-of-pocket expenses with pretax money.

Taken together, this provision and the change in the medical expense deduction are expected to raise more than $40 billion of revenue over 10 years.

Read More..

New Taxes to Take Effect to Fund Health Care Law

WASHINGTON — For more than a year, politicians have been fighting over whether to raise taxes on high-income people. They rarely mention that affluent Americans will soon be hit with new taxes adopted as part of the 2010 health care law.

The new levies, which take effect in January, include an increase in the payroll tax on wages and a tax on investment income, including interest, dividends and capital gains. The Obama administration proposed rules to enforce both last week.

Affluent people are much more likely than low-income people to have health insurance, and now they will, in effect, help pay for coverage for many lower-income families. Among the most affluent fifth of households, those affected will see tax increases averaging $6,000 next year, economists estimate.

To help finance Medicare, employees and employers each now pay a hospital insurance tax equal to 1.45 percent on all wages. Starting in January, the health care law will require workers to pay an additional tax equal to 0.9 percent of any wages over $200,000 for single taxpayers and $250,000 for married couples filing jointly.

The new taxes on wages and investment income are expected to raise $318 billion over 10 years, or about half of all the new revenue collected under the health care law.

Ruth M. Wimer, a tax lawyer at McDermott Will & Emery, said the taxes came with “a shockingly inequitable marriage penalty.” If a single man and a single woman each earn $200,000, she said, neither would owe any additional Medicare payroll tax. But, she said, if they are married, they would owe $1,350. The extra tax is 0.9 percent of their earnings over the $250,000 threshold.

Since the creation of Social Security in the 1930s, payroll taxes have been levied on the wages of each worker as an individual. The new Medicare payroll is different. It will be imposed on the combined earnings of a married couple.

Employers are required to withhold Social Security and Medicare payroll taxes from wages paid to employees. But employers do not necessarily know how much a worker’s spouse earns and may not withhold enough to cover a couple’s Medicare tax liability. Indeed, the new rules say employers may disregard a spouse’s earnings in calculating how much to withhold.

Workers may thus owe more than the amounts withheld by their employers and may have to make up the difference when they file tax returns in April 2014. If they expect to owe additional tax, the government says, they should make estimated tax payments, starting in April 2013, or ask their employers to increase the amount withheld from each paycheck.

In the Affordable Care Act, the new tax on investment income is called an “unearned income Medicare contribution.” However, the law does not provide for the money to be deposited in a specific trust fund. It is added to the government’s general tax revenues and can be used for education, law enforcement, farm subsidies or other purposes.

Donald B. Marron Jr., the director of the Tax Policy Center, a joint venture of the Urban Institute and the Brookings Institution, said the burden of this tax would be borne by the most affluent taxpayers, with about 85 percent of the revenue coming from 1 percent of taxpayers. By contrast, the biggest potential beneficiaries of the law include people with modest incomes who will receive Medicaid coverage or federal subsidies to buy private insurance.

Wealthy people and their tax advisers are already looking for ways to minimize the impact of the investment tax — for example, by selling stocks and bonds this year to avoid the higher tax rates in 2013.

The new 3.8 percent tax applies to the net investment income of certain high-income taxpayers, those with modified adjusted gross incomes above $200,000 for single taxpayers and $250,000 for couples filing jointly.

David J. Kautter, the director of the Kogod Tax Center at American University, offered this example. In 2013, John earns $160,000, and his wife, Jane, earns $200,000. They have some investments, earn $5,000 in dividends and sell some long-held stock for a gain of $40,000, so their investment income is $45,000. They owe 3.8 percent of that amount, or $1,710, in the new investment tax. And they owe $990 in additional payroll tax.

The new tax on unearned income would come on top of other tax increases that might occur automatically next year if President Obama and Congress cannot reach an agreement in talks on the federal deficit and debt. If Congress does nothing, the tax rate on long-term capital gains, now 15 percent, will rise to 20 percent in January. Dividends will be treated as ordinary income and taxed at a maximum rate of 39.6 percent, up from the current 15 percent rate for most dividends.

Under another provision of the health care law, consumers may find it more difficult to obtain a tax break for medical expenses.

Taxpayers now can take an itemized deduction for unreimbursed medical expenses, to the extent that they exceed 7.5 percent of adjusted gross income. The health care law will increase the threshold for most taxpayers to 10 percent next year. The increase is delayed to 2017 for people 65 and older.

In addition, workers face a new $2,500 limit on the amount they can contribute to flexible spending accounts used to pay medical expenses. Such accounts can benefit workers by allowing them to pay out-of-pocket expenses with pretax money.

Taken together, this provision and the change in the medical expense deduction are expected to raise more than $40 billion of revenue over 10 years.

Read More..

Bits Blog: Facebook Likely to End Experiment With Democracy

A half-million Facebook users have told the social network they do not want the company to change its privacy policy. Sounds impressive, right? Well, the only way that crowd will get its way and the status quo remain intact is if an additional 300 million people vote thumbs down before Monday. Odds of that happening? About zero.

Facebook says the changes to the policy are minor and beneficial for users. One concerns the integration of Instagram data with Facebook; another changes the filters for managing incoming messages. Privacy watchdogs disagree. So do those who bothered to vote: Shortly before noon Pacific time on Friday, 476,718 were against the proposed changes. A mere 68,884 were in favor.

But the really interesting change is that Facebook is proposing to end this system of direct voting, which was implemented in early 2009 after a major privacy flap. “If we are trying to move the world to being more open and transparent and to get people to share more information, having an open process around this is ultimately the only way to do that,” Mark Zuckerberg, Facebook’s founder, said at the time in a conference call.

The problem was that more than 30 percent of all Facebook users had to vote against a proposal for it to be binding. In the last vote, in June, the no’s outweighed the yeses by a ratio of six to one, but the total votes were less than one half of 1 percent of the users. That made the vote simply advisory. And so Facebook went ahead and implemented the changes anyway.

There has been relatively little commentary, much less outrage, about the new changes. One notable exception was Michael Phillips, who wrote a much-quoted piece in BuzzFeed, “The End of the Facebook Democracy”: “By repealing Facebook Suffrage, Facebook abandons a fundamental norm — that its users are citizens in a community, and not simply datapoints on an advertising algorithm. The vote may be quixotic, but if Facebook remains the indispensable social network, you’ll want to be able to tell your grandchildren you fought for Facebook freedom.”

Some users are trying to take their privacy into their own hands. They are reproducing the following text as a status update:

“In response to the new Facebook guidelines, I hereby declare that my copyright is attached to all of my personal details, status updates, messages, photos, videos and all other personal content that I post or have posted, online, as a result of the Berne Convention, on my personal profile page, or anyone else’s page, For commercial use of the above, MY WRITTEN CONSENT IS NEEDED AT ALL TIMES WITH NO EXCEPTION.”

Perhaps this makes them feel better. But in reality, it has no legal standing at all.

Read More..

Art and Commerce Meet in Miami Beach

Katie Orlinsky for The New York Times

Visitors at the V.I.P. opening of Art Basel Miami Beach.

MIAMI — Mera Rubell was taking time out from greeting the hundreds of visitors at her family’s sprawling contemporary art center here to vent.

“It’s the height of arrogance to dismiss — — ,” she began.

Jason, her son, interrupted: “It’s arrogance. It’s a completely uninteresting story.”

For the moment her husband, Don, had given up on trying to get a word in.

The Rubells, deans of Miami’s bustling art scene, were pushing back against a chorus of complaints that has been growing louder in the weeks leading up to Art Basel Miami Beach, the annual art pilgrimage that began Wednesday and ends Sunday.

Prominent art writers and critics, including Sarah Thornton, Felix Salmon, Will Gompertz and Dave Hickey, have been attacking the art world, arguing that the staggering sums of money being spent on works are distorting judgments about art and undermining its long-term cultural significance.

“Money talks loudly and easily drowns out other meanings,” Ms. Thornton wrote in TAR magazine in a recent article, “Top 10 Reasons NOT to Write About the Art Market.”

In its special edition for the opening day of the fair, The Art Newspaper asked whether “the art world is facing a crisis of values” because of the “pernicious influence of the market on art.”

And in the eyes of many critics, Art Basel Miami Beach — or what Simon Doonan, writing in Slate last week, labeled a “promo-party cheese-fest” — has become a symbol of everything that’s wrong with the art market. The fair’s extraordinary success in just over a decade, and its celebration of wretched excess, have triggered a backlash.

But the Rubells, along with a growing number of other prominent collectors, art dealers and curators, are having none of it. The backlash against the backlash has begun.

“The market supports artists,” Jason Rubell said. Given the limited amount of government support for the arts, he added, “it’s an industry that without commerce doesn’t exist. What do people want — to go back to the recession?”

Ms. Rubell was annoyed that critics seemed to ignore the social, economic and cultural transformation of Miami that the fair and collectors like her have helped bring about. She noted that the Rubells’ 45,000-square-foot art center — where one huge gallery is now filled with works by Oscar Murillo, a 26-year-old Colombian immigrant who lived with and was supported by the Rubells while he created dozens of mural-sized canvases — used to be a Drug Enforcement Administration storage center.

Outside, in the center’s courtyard, visitors like Martha Stewart admired the French artist Bernar Venet’s collaboration with Bugatti, the superluxury sports car brand, on a one-of-a-kind Veyron Grand Sport Venet car (a price hasn’t been set, a Bugatti spokeswoman said, but will undoubtedly be in “the higher end of the millions”).

“I’m grateful to Bugatti, Perrier, Bank of America and other companies,” Ms. Rubell declared. “Their support helps facilitate quality programs and opens exhibits like this” — the Murillo show — “to the public.”

In Miami Beach, at the main fair, the consumer-oriented glitter abounds this week: coffee carts with $20-a-glass Ruinart Champagne; Davidoff cigar rollers; BMW’s artist-designed cars; and Takashi Murakami’s $70,000-and-up commissioned portraits. One could almost imagine that the Barbara Kruger work on display at L&M gallery — a super-sized sign reading “Greedy” on one line and an unprintable expletive on the next — had an invisible subtitle telling the wealthy V.I.P.’s who had come to shop, “I’m Talking to You — Yeah, You!”

Of course, rich patrons have always supported artists, Don Rubell pointed out, from the pharaohs to the Medicis. Today, multimillion-dollar sales represent only a silk-thin layer of a deeply varied and thriving art market. The art world, Mr. Rubell asserted, is “actually becoming more democratic.”

“There’s 20 ancillary fairs” in addition to the high-end main event of Art Basel, he said. “Whatever amount of money you have in your pocket, you can enter this magical world of art.”

The notion that the art market contains multitudes is one with which Marc Glimcher, part of the family dynasty that runs the Pace Gallery, said he agreed.

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Job Growth Is Steady Despite Storm and Fiscal Impasse

A Lower Than Expected Jobless Rate:
The U.S. Labor Department reports a sharper increase in job creation than economists had been expecting.

Shaking off the effects of Hurricane Sandy and the looming fiscal impasse in Washington, the economy created 146,000 jobs in November, well above the level economists had been expecting.

Source: Bureau of Labor Statistics

The report released Friday by the Labor Department also showed the unemployment rate fell to 7.7 percent, the lowest level in four years. But the drop came largely from a decline in the number of people seeking work and counted as officially unemployed.

Among specific industries, the retail sector was especially healthy, adding 53,000 jobs as the holiday shopping season approached. In the last three months, retail employment has increased by 140,000.

One notable point of weakness was the manufacturing sector, which lost 7,000 jobs in the month. Demand from Europe and other overseas markets has weakened recently, while some manufacturing companies have held off on spending as political leaders square off in Washington over how to cut the deficit.

Highlighting just how vulnerable to shocks the economy remains, one widely followed index of consumer sentiment showed a marked drop in early December. The Thomson Reuters/University of Michigan’s index of consumer confidence, released Friday, fell to 74.5, down from 82.7 in November.

That was the lowest it has been since August – a decline that Bricklin Dwyer, an economist with BNP Paribas, attributed to the showdown in Washington over the budget.

“The deterioration in consumers’ future expectations was probably related to increased concerns relating to the political theater surrounding the ‘fiscal cliff’ negotiations,” he wrote in a report Friday.

The Labor Department revised job growth in previous months downward somewhat. October growth fell to 138,000 from an initial estimate 171,000, and September’s declined to 132,000 from 148,000. Average hourly earnings in November rose 0.2 percent, the report showed.

By the widest measure of joblessness, unemployment also eased slightly: after factoring in people looking for work as well as those forced to take part-time positions because full-time work wasn’t available, the total unemployed fell to 14.4 percent in November from 14.6 percent in October.

The report for November was relatively strong, economists said, and showed fewer effects from Hurricane Sandy that had been expected. In Friday’s announcement, the Bureau of Labor Statistics said the storm did “not substantively impact the national employment and unemployment estimates for November.”

Ethan Harris, co-head of global economics at Bank of America of Merrill Lynch, said, “It’s a pretty solid report. It’s consistent with a slow recovery in the job market.”

“It’s encouraging that with the fiscal cliff looming, the corporate sector seems willing to hire even with the worries about what’s going in Washington,” Mr. Harris said.

If the budget impasse can’t be resolved this month, however, it’s likely that jobs growth will weaken early next year, he added. “The fiscal cliff is a very dangerous game,” he said.

Indeed, other economists remained cautious about the jobs outlook.

“It’s not something to get too excited about,” said Nigel Gault, chief United States economist for IHS Global Insight. “The number is 146,000 and the average so far this year is 151,000. We’re pretty much in line with what we’ve been doing.”

Mr. Gault said Hurricane Sandy’s impact may have been seen in construction, where the number of jobs fell by 20,000, as well as in manufacturing.

The labor participation rate, which represents the proportion of the adult population that is either employed or actively looking for work, remains very low by historical standards.

At 63.6 percent in November, Mr. Gault said, it was just 0.1 percent above the low point for the current economic cycle, which was reached in August 2012.

“We’re not at the point in which the jobs market is strong enough to pull discouraged workers back into the labor market," he said.

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DealBook: Standard Chartered Settles Iran Money -Laundering Claims

HONG KONG – The British bank Standard Chartered said on Thursday that it expected to pay $330 million to settle claims by United States government agencies that it had moved hundreds of billions of dollars on behalf of Iran.

Standard Chartered, which earns most of its profit in Asia, said it expected negotiations to conclude “very shortly” over charges that it violated American sanctions against Iran.

The estimated settlement payment would come in addition to a $340 million settlement the bank reached in August with the New York State Department of Financial Services, which charged Standard Chartered with scheming with Iranian companies and banks for nearly a decade to hide 60,000 transactions worth $250 billion from regulators.

Standard Chartered is the latest big bank to have been caught up in a wide-reaching American crackdown on suspect money transfers.

Last month, HSBC Holdings, another major British bank, set aside an additional $800 million to cover potential fines stemming from a money laundering investigation, bringing its total provisions for the case to $1.5 billion. HSBC is still negotiating a settlement with the American authorities, but it is expected to pay the largest fine on record for money laundering and related actions, and could potentially face criminal charges in the matter.

In June, ING Bank, a unit of the Dutch financial services company ING Group, reached a $619 million settlement with the Treasury Department over claims the bank violated American sanctions against Iran, Libya and other countries.

Before announcing the August settlement, Standard Chartered had disclosed that it was reviewing transactions it handled on behalf of Iranian companies and individuals from around 2001 to 2007, and was discussing potential sanctions violations with agencies including the Justice Department, the Office of Foreign Assets Control, the Federal Reserve Bank of New York and the Manhattan district attorney, in addition to the New York State Department of Financial Services.

Despite the big New York settlement, Standard Chartered said in a statement on Thursday that it expected pretax profit to rise for 2012. The profit estimate did not take into account the effect of the estimated $330 million settlement with the United States, which it said could be completed as early as this month.

“There is not much to say other than that we are close to reaching a final settlement with the remaining U.S. agencies,” Richard Meddings, the group finance director of the bank, said on Thursday during a conference call. “Negotiations or discussions are progressing well.”

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This post has been revised to reflect the following correction:

Correction: December 6, 2012

An earlier version of this article referred incorrectly to a banking agency and a public official. The agency is the Federal Reserve Bank of New York, not the Federal Reserve Group of New York. The official is the Manhattan district attorney, not the district attorney of New York.

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Extended Use of Breast Cancer Drug Suggested

The widely prescribed drug tamoxifen already plays a major role in reducing the risk of death from breast cancer. But a new study suggests that women should be taking the drug for twice as long as is now customary, a finding that could upend the standard that has been in place for about 15 years.

In the study, patients who continued taking tamoxifen for 10 years were less likely to have the cancer come back or to die from the disease than women who took the drug for only five years, the current standard of care.

“Certainly, the advice to stop in five years should not stand,” said Prof. Richard Peto, a medical statistician at Oxford University and senior author of the study, which was published in The Lancet on Wednesday and presented at the San Antonio Breast Cancer Symposium.

Breast cancer specialists not involved in the study said the results could have the biggest impact on premenopausal women, who account for a fifth to a quarter of new breast cancer cases. Postmenopausal women tend to take different drugs, but some experts said the results suggest that those drugs might be taken for a longer duration as well.

“We’ve been waiting for this result,” said Dr. Robert W. Carlson, a professor of medicine at Stanford University. “I think it is especially practice-changing in premenopausal women because the results do favor a 10-year regimen.”

Dr. Eric P. Winer, chief of women’s cancers at the Dana-Farber Cancer Institute in Boston, said that even women who completed their five years of tamoxifen months or years ago might consider starting on the drug again.

Tamoxifen blocks the effect of the hormone estrogen, which fuels tumor growth in estrogen receptor-positive cancers that account for about 65 percent of cases in premenopausal women. Some small studies in the 1990s suggested that there was no benefit to using tamoxifen longer than five years, so that has been the standard.

About 227,000 cases of breast cancer are diagnosed each year in the United States, and an estimated 30,000 of them are in premenopausal women with estrogen receptor-positive cancer and prime candidates for tamoxifen. But postmenopausal women also take tamoxifen if they cannot tolerate the alternative drugs, known as aromatase inhibitors.

The new study, known as Atlas, included nearly 7,000 women with ER-positive disease who had completed five years of tamoxifen. They came from about three dozen countries. Half were chosen at random to take the drug another five years, while the others were told to stop.

In the group assigned to take tamoxifen for 10 years, 21.4 percent had a recurrence of breast cancer in the ensuing 10 years, meaning the period 5 to 14 years after their diagnoses. The recurrence rate for those who took only five years of tamoxifen was 25.1 percent.

About 12.2 percent of those in the 10-year treatment group died from breast cancer, compared with 15 percent for those in the control group.

There was virtually no difference in death and recurrence between the two groups during the five years of extra tamoxifen. The difference came in later years, suggesting that tamoxifen has a carry-over effect that lasts long after women stop taking it.

Whether these differences are big enough to cause women to take the drug for twice as long remains to be seen.

“The treatment effect is real, but it’s modest,” said Dr. Paul E. Goss, director of breast cancer research at the Massachusetts General Hospital.

Tamoxifen has side effects, including endometrial cancer, blood clots and hot flashes, which cause many women to stop taking the drug. In the Atlas trial, it appears that roughly 40 percent of the patients assigned to take tamoxifen for the additional five years stopped prematurely.

Some 3.1 percent of those taking the extra five years of tamoxifen got endometrial cancer versus 1.6 percent in the control group. However, only 0.6 percent of those in the longer treatment group died from endometrial cancer or pulmonary blood clots, compared with 0.4 percent in the control group.

“Over all, the benefits of extended tamoxifen seemed to outweigh the risks substantially,” Trevor J. Powles of the Cancer Center London, said in a commentary published by The Lancet.

Dr. Judy E. Garber, director of the Center for Cancer Genetics and Prevention at Dana-Farber, said many women have a love-hate relationship with hormone therapies.

“They don’t feel well on them, but it’s their safety net,” said Dr. Garber, who added that the news would be welcomed by many patients who would like to stay on the drug. “I have patients who agonize about this, people who are coming to the end of their tamoxifen.”

Emily Behrend, who is a few months from finishing her five years on tamoxifen, said she would definitely consider another five years. “If it can keep the cancer away, I’m all for it,” said Ms. Behrend, 39, a single mother in Tomball, Tex. She is taking the antidepressant Effexor to help control the night sweats and hot flashes caused by tamoxifen.

Cost is not considered a huge barrier to taking tamoxifen longer because the drug can be obtained for less than $200 a year.

The results, while answering one question, raise many new ones, including whether even more than 10 years of treatment would be better still.

Perhaps the most important question is what the results mean for postmenopausal women. Even many women who are premenopausal at the time of diagnosis will pass through menopause by the time they finish their first five years of tamoxifen, or will have been pushed into menopause by chemotherapy.

Postmenopausal patients tend to take aromatase inhibitors like anastrozole or letrozole, which are more effective than tamoxifen at preventing breast cancer recurrence, though they do not work for premenopausal women.

Mr. Peto said he thought the results of the Atlas study would “apply to endocrine therapy in general,” meaning that 10 years of an aromatase inhibitor would be better than five years. Other doctors were not so sure.

The Atlas study was paid for by various organizations including the United States Army, the British government and AstraZeneca, which makes the brand-name version of tamoxifen.

Read More..

Extended Use of Breast Cancer Drug Suggested

The widely prescribed drug tamoxifen already plays a major role in reducing the risk of death from breast cancer. But a new study suggests that women should be taking the drug for twice as long as is now customary, a finding that could upend the standard that has been in place for about 15 years.

In the study, patients who continued taking tamoxifen for 10 years were less likely to have the cancer come back or to die from the disease than women who took the drug for only five years, the current standard of care.

“Certainly, the advice to stop in five years should not stand,” said Prof. Richard Peto, a medical statistician at Oxford University and senior author of the study, which was published in The Lancet on Wednesday and presented at the San Antonio Breast Cancer Symposium.

Breast cancer specialists not involved in the study said the results could have the biggest impact on premenopausal women, who account for a fifth to a quarter of new breast cancer cases. Postmenopausal women tend to take different drugs, but some experts said the results suggest that those drugs might be taken for a longer duration as well.

“We’ve been waiting for this result,” said Dr. Robert W. Carlson, a professor of medicine at Stanford University. “I think it is especially practice-changing in premenopausal women because the results do favor a 10-year regimen.”

Dr. Eric P. Winer, chief of women’s cancers at the Dana-Farber Cancer Institute in Boston, said that even women who completed their five years of tamoxifen months or years ago might consider starting on the drug again.

Tamoxifen blocks the effect of the hormone estrogen, which fuels tumor growth in estrogen receptor-positive cancers that account for about 65 percent of cases in premenopausal women. Some small studies in the 1990s suggested that there was no benefit to using tamoxifen longer than five years, so that has been the standard.

About 227,000 cases of breast cancer are diagnosed each year in the United States, and an estimated 30,000 of them are in premenopausal women with estrogen receptor-positive cancer and prime candidates for tamoxifen. But postmenopausal women also take tamoxifen if they cannot tolerate the alternative drugs, known as aromatase inhibitors.

The new study, known as Atlas, included nearly 7,000 women with ER-positive disease who had completed five years of tamoxifen. They came from about three dozen countries. Half were chosen at random to take the drug another five years, while the others were told to stop.

In the group assigned to take tamoxifen for 10 years, 21.4 percent had a recurrence of breast cancer in the ensuing 10 years, meaning the period 5 to 14 years after their diagnoses. The recurrence rate for those who took only five years of tamoxifen was 25.1 percent.

About 12.2 percent of those in the 10-year treatment group died from breast cancer, compared with 15 percent for those in the control group.

There was virtually no difference in death and recurrence between the two groups during the five years of extra tamoxifen. The difference came in later years, suggesting that tamoxifen has a carry-over effect that lasts long after women stop taking it.

Whether these differences are big enough to cause women to take the drug for twice as long remains to be seen.

“The treatment effect is real, but it’s modest,” said Dr. Paul E. Goss, director of breast cancer research at the Massachusetts General Hospital.

Tamoxifen has side effects, including endometrial cancer, blood clots and hot flashes, which cause many women to stop taking the drug. In the Atlas trial, it appears that roughly 40 percent of the patients assigned to take tamoxifen for the additional five years stopped prematurely.

Some 3.1 percent of those taking the extra five years of tamoxifen got endometrial cancer versus 1.6 percent in the control group. However, only 0.6 percent of those in the longer treatment group died from endometrial cancer or pulmonary blood clots, compared with 0.4 percent in the control group.

“Over all, the benefits of extended tamoxifen seemed to outweigh the risks substantially,” Trevor J. Powles of the Cancer Center London, said in a commentary published by The Lancet.

Dr. Judy E. Garber, director of the Center for Cancer Genetics and Prevention at Dana-Farber, said many women have a love-hate relationship with hormone therapies.

“They don’t feel well on them, but it’s their safety net,” said Dr. Garber, who added that the news would be welcomed by many patients who would like to stay on the drug. “I have patients who agonize about this, people who are coming to the end of their tamoxifen.”

Emily Behrend, who is a few months from finishing her five years on tamoxifen, said she would definitely consider another five years. “If it can keep the cancer away, I’m all for it,” said Ms. Behrend, 39, a single mother in Tomball, Tex. She is taking the antidepressant Effexor to help control the night sweats and hot flashes caused by tamoxifen.

Cost is not considered a huge barrier to taking tamoxifen longer because the drug can be obtained for less than $200 a year.

The results, while answering one question, raise many new ones, including whether even more than 10 years of treatment would be better still.

Perhaps the most important question is what the results mean for postmenopausal women. Even many women who are premenopausal at the time of diagnosis will pass through menopause by the time they finish their first five years of tamoxifen, or will have been pushed into menopause by chemotherapy.

Postmenopausal patients tend to take aromatase inhibitors like anastrozole or letrozole, which are more effective than tamoxifen at preventing breast cancer recurrence, though they do not work for premenopausal women.

Mr. Peto said he thought the results of the Atlas study would “apply to endocrine therapy in general,” meaning that 10 years of an aromatase inhibitor would be better than five years. Other doctors were not so sure.

The Atlas study was paid for by various organizations including the United States Army, the British government and AstraZeneca, which makes the brand-name version of tamoxifen.

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Apple to Resume U.S. Manufacturing

For the first time in years, Apple will manufacture computers in the United States, the chief executive of Apple, Timothy D. Cook, said in interviews with NBC and Bloomberg Businessweek.

“Next year, we will do one of our existing Mac lines in the United States,” he said in an interview to be broadcast Thursday on “Rock Center With Brian Williams” on NBC.

Apple, the biggest company in the world by market value, moved most of its manufacturing to Asia in the late 1990s. As an icon of American technology success and innovation, the California-based company has been criticized in recent years for outsourcing jobs abroad.

“I don’t think we have a responsibility to create a certain kind of job,” Mr. Cook said in the Businessweek interview. “But I think we do have a responsibility to create jobs.”

The company plans to spend $100 million on the American manufacturing in 2013, according to the interviews, a small fraction of its overall factory investments and an even tinier portion of its available cash.

In the interviews, Mr. Cook suggested the company would work with partners and that the manufacturing would be more than just the final assembly of parts. He noted that parts of the company’s ubiquitous iPhone, including the “engine” and the glass screen, were already made in America. The processor is manufactured by Samsung in Texas, while Corning makes the glass screen in Kentucky.

Over the last few years, sales of the iPhone, iPod and iPad have overwhelmed Apple’s line of Macintosh computers, the basis of the company’s early business. Revenue from the iPhone alone made up 48 percent of the company’s total revenue for its fiscal fourth quarter ended Sept. 30.

But as recently as October, Apple introduced a new, thinner iMac, the product that pioneered the technique of building the computer innards inside the flat screen.

Mr. Cook did not say in the interviews where in the United States the new manufacturing would occur. But he did defend Apple’s track record in American hiring.

“When you back up and look at Apple’s effect on job creation in the United States, we estimate that we’ve created more than 600,000 jobs now,” Mr. Cook told Businessweek. Those jobs include positions at partners and suppliers.

Steve Dowling, a spokesman for Apple, declined on Thursday to provide additional details on Apple’s plans, referring to Mr. Cook’s interviews.

Apple has for years done the final assembly of some Macs in the United States, mainly systems that customers buy with custom configurations, like bigger hard drives and more memory than on standard machines.

Mr. Cook’s statements suggested Apple is planning to build more of the Mac’s ingredients domestically, although with partners. He told Businessweek that the plan “doesn’t mean that Apple will do it ourselves, but we’ll be working with people, and we’ll be investing our money.”

While Apple’s products are typically made in Asian factories owned by other companies, Apple itself often purchases the sophisticated manufacturing equipment required to make its cutting-edge designs, spending billions of dollars a year on such machines.

Foxconn Technology, which manufactures more than 40 percent of the world’s electronics, is one of Apple’s main overseas manufacturing contractors. Based in Taiwan, Foxconn is China’s largest private employer, with 1.2 million workers, and it has come under intense scrutiny over working conditions inside its factories.

In March, Foxconn pledged to sharply curtail the number of working hours and significantly increase wages. The announcement was a response to a far-ranging inspection by the Fair Labor Association, a monitoring group that found widespread problems — including numerous instances where Foxconn violated Chinese law and industry codes of conduct.

Apple, which recently joined the labor association, had asked the group to investigate plants manufacturing iPhones, iPads and other devices. A growing outcry over conditions at overseas factories prompted protests and petitions, and several labor rights organizations started scrutinizing Apple’s suppliers.

Almost all of the 70 million iPhones, 30 million iPads and 59 million other products Apple sold in 2011 were manufactured overseas. Apple employs 43,000 people in the United States and 20,000 overseas. An additional 700,000 people engineer, build and assemble iPads, iPhones and Apple’s other products, mostly abroad.

At a meeting with Silicon Valley executives in 2011, President Obama asked Steven P. Jobs, then the Apple chief executive, what it would take to make iPhones in the United States. Mr. Jobs, who died later that year, told the president, “Those jobs aren’t coming back.”

Nick Wingfield contributed reporting.

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3 Charged With Plotting to Export Carbon Fiber to Iran

Three people have been charged with conspiring to illegally export to Iran and China a superstrong material called carbon fiber that can be used to make machines that can enrich uranium, federal prosecutors in Manhattan said on Wednesday.

Iran has been pursuing carbon-fiber technology for years, and has had difficulty in obtaining the material. Enriched uranium can be used as fuel for nuclear reactors and atom bombs.

Another man was charged in a purported scheme to illegally export to Iran via South Korea components for helicopters that could be used for military purposes, the authorities said.

Three of the four men have been arrested. One of them, Hamid Reza Hashemi, 52, a dual United States and Iranian citizen who runs a company in Tehran that the United States government says has been trying to obtain carbon-fiber technology, was arrested on Saturday at Kennedy International Airport as he entered the country, prosecutors said.

Another defendant, Peter Gromacki, 48, of Middletown, N.Y., was accused of arranging for the export of more than 6,000 pounds of carbon fiber from the United States to China via Belgium, in violation of federal law, the government said.

“The law prohibits the exportation of goods to Iran and certain goods to China,” said George Venizelos, who heads the Federal Bureau of Investigation’s New York office.

A third defendant, Amir Abbas Tamimi, 40, an Iranian accused in the purported helicopter-component deal, was arrested at Kennedy Airport in October, the authorities said. He and Mr. Hashemi are being held without bond, while Mr. Gromacki was released on bond, the government said.

The fourth defendant, Murat Taskiran, a Turk accused in the purported carbon-fiber scheme, has not yet been arrested.

The charges do not specify precisely what the government believes the carbon-fiber technology was going to be used for in Iran.

But Preet Bharara, the United States attorney in Manhattan, whose office is prosecuting the men, said “carbon fiber in the wrong hands poses a serious threat” to the national security of the United States.

“Two of these defendants are charged with arranging its export to Iran, where it most assuredly had the potential to end up in the wrong hands,” Mr. Bharara said.

The government charged that in March and April 2008, Mr. Hashemi and Mr. Taskiran worked with an unidentified European broker to arrange for the shipment of carbon fiber from the United States to Iran through Europe and Dubai.

Carbon fiber is used to make rotors for centrifuges, which are used to enrich uranium.

The government also charged that this year Mr. Hashemi sent messages to the European broker, indicating that he wanted to travel to the United States to see a carbon-fiber-winding machine that he wanted to buy. Such machines can be used to make the rotors.

Lawyers for the three men who have been arrested could not be reached for comment Wednesday evening.

William J. Broad contributed reporting.

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