Spill in China Lays Bare Environmental Concerns

Adam Dean for The New York Times

A member of the Handan Winter Swimming Association, which has sued over a chemical spill.

HANDAN, China — The first warning came in the form of dead fish floating in a river.

Then officials in this city got confirmation that a chemical spill had taken place at a fertilizer factory upstream. They shut off the tap water, which sent residents into a scramble for bottled water. In the countryside, officials also told farmers not to graze their livestock near the river.

The spill, which occurred on Dec. 31, affected at least 28 villages and a handful of cities of more than one million people, including Handan. Officials here were irate that their counterparts in Changzhi, where the polluting factory was located, had delayed reporting the spill for five days. For the past two months, Changzhi officials and executives at the company running the factory, Tianji Coal Chemical Industry Group, have generally stayed silent, exacerbating anxiety over water quality.

The conflict over the Changzhi spill has drawn attention to the growing problems with water use and pollution in northern China. The region, which has suffered from a drought for decades, is grappling with how industrial companies should operate along rivers. Local officials are shielding polluting companies and covering up environmental degradation, say environmentalists.

“Problems with water weren’t so serious before, but they have become much worse with industrial consumption,” said Yin Qingli, a lawyer in Handan who filed a lawsuit in January against Tianji, which uses water to convert coal to fertilizer at the factory in Changzhi.

Environmental degradation has led many Chinese to question the Communist Party’s management of the country’s economic growth. Addressing the problem is one the greatest challenges for the administration of Xi Jinping, the new chief of the Communist Party. Environmental issues will most likely be on the agenda at the annual meeting of the National People’s Congress, scheduled to begin on Tuesday.

The results of an official investigation into the Tianji spill were announced on Feb. 20 by Xinhua, the state news agency, which reported that a faulty hose had resulted in the leakage of about 39 tons of aniline, a potential carcinogen, from the fertilizer factory. Thirty tons were contained by a reservoir, but nearly nine tons leaked into the Zhuozhang River, which feeds into the Zhang River that runs to Hebei Province, where Handan is, and Henan Province. The Xinhua report said 39 people had been punished, including Zhang Bao, the mayor of Changzhi, who was removed from his post. But the party chief, Tian Xirong, the city’s top authority, was recently promoted to deputy director of the provincial Parliament.

Some critics say officials may be slow to divulge information because the acting governor of Shanxi Province, where Changzhi is, is Li Xiaopeng, the “princeling” son of Li Peng, a powerful Communist Party elder. At a news conference in January after news of the spill had emerged, the younger Mr. Li urged officials to make safety a top priority.

Handan officials first got a tip about a potential spill on Jan. 4 from a water management agency upstream. But when they tried contacting Changzhi officials, there was no response. “After more than 30 calls, we still weren’t able to reach them,” a Handan environmental official told Xinhua. Only the next day did Changzhi officials agree to meet with Handan officials.

At least two managers of Tianji have been fired, but the company, which is the foundation of Changzhi’s economy, appears to have suffered no other significant consequences. It is one of many companies in China’s booming coal-to-chemicals industry, in which a water-intensive gasification process is used to convert coal to chemicals that are critical for a wide range of products. The process results in large amounts of wastewater that is supposed to be treated and then contained.

After sending a team to Handan in January, Greenpeace East Asia issued a report on the spill. It said that there were about 100 coal-to-chemical factories on the upper reaches of the Zhuozhang River. “There is a history of clashes between heavily water-consuming coal-to-chemical factories and citizens downstream who are trying to compete for water to drink,” the report said. Larger factories like those of Tianji use 2,000 to 3,000 tons of water per hour, equivalent to the amount of water that more than 300,000 people use in a year.

The factory in Changzhi dumps more than six million tons of wastewater per year, about 30 percent of the water taken from the river, according to Greenpeace. The wastewater is supposed to drain into a receptacle.

Amy Qin and Patrick Zuo contributed research from Handan and Beijing.

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Detroit Car Sales Climb Again

DETROIT – Sales of new vehicles in the United States rose modestly in February, as consumers continued to buy more fuel-efficient cars and as businesses replaced aging pickup trucks with newer models.

Auto executives said overall industry sales for the month would improve about 2 percent over the strong results reported in the same period a year ago.

The seasonally adjusted annual sales rate – a closely watched indicator for the industry – is expected to total about 15.5 million vehicles for February.

That seasonal rate bodes well for the industry going forward, as automakers ratchet up production to meet demand for their new products.

The Detroit auto companies all posted positive results during the month.

General Motors, the largest American automaker, said it sold 224,000 vehicles in February, a 7 percent increase from the same month in 2012.

All of G.M.'s domestic brands – Chevrolet, Cadillac, GMC and Buick – had higher year-over-year sales. Cadillac led the way with a 20 percent gain, primarily because of healthy sales of the new ATS compact sedan.

G.M. also reported increases in sales of its newest small cars, like the Buick Verano and the Chevrolet Spark. But its most prominent gains were in pickup trucks.

The company said that sales of the Chevrolet Silverado pickup rose 29 percent, and the GMC Sierra increased 25 percent. Executives attributed the performance to a surge in housing starts and the need for construction companies to replace older pickups.

“A significant tailwind for our industry is new home construction, which is creating jobs and fueling the demand for pickups,” said Kurt McNeil, G.M.'s vice president of United States sales operations.

The Ford Motor Company, the second-biggest Detroit auto company, said it sold 195,000 vehicles during the month, a 9 percent gain from a year ago.

Ford said that many of its gains came from sales of sport utilities such as the Escape and Explorer. The company’s redesigned midsize sedan, the Fusion, also had a good month, with a 28 percent improvement over last year.

Like G.M., Ford also benefitted from the surging demand for pickups. Ford said that it sold 54,000 F-series trucks during the month, a 15 percent increase from February of 2012.

Chrysler, the smallest of the Detroit automakers, saw its growth rate slow somewhat after several months of reporting double-digit increases.

The company said that it sold 139,000 vehicles in February, a 4 percent improvement over a year earlier. That is a smaller increase than Chrysler has reported in previous months.

“In spite of a cautious ramp-up of some of our most popular products, which limited inventory last month, we still managed to record our strongest February in five years,” said Reid Bigland, head of United States sales for Chrysler.

Chrysler’s best performers during the month were passenger cars such as the new Dodge Dart. Sales of its Ram pickup increased 3 percent, while sales of its Jeep SUVs dropped 16 percent.

The big Japanese automakers were to report results later Friday. Analysts expected Toyota and Honda to continue their steady comeback from inventory disruptions because of the earthquake and tsunami in Japan two years ago.

Volkswagen, the German automaker that is rapidly expanding its American operations, said it sold 31,000 vehicles in February, a 3 percent increase from a year earlier.

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The New Old Age Blog: Why Can’t I Live With People Like Me?

“Aging in place” is the mantra of long-term care. Whether looking at reams of survey data, talking to friends or wishing on a star, who among us wouldn’t rather spend the final years — golden or less so — at home, surrounded by our cherished possessions, in our own bed, no cranky old coot as a roommate, no institutional smells or sounds, no lukewarm meals on a schedule of someone else’s making?

That works best, experts tell us, in dense cities, where we can hail a cab at curbside, call the superintendent when something breaks and have our food delivered from Fresh Direct or countless takeout restaurants. We’d have neighbors in the apartment above us, below us, just on the other side of the wall. Hearing their toilets flush and their children ride tricycles on uncarpeted floors is a small inconvenience compared to the security of knowing they are so close by in an emergency.

Urban planners, mindful that most Americans live in sprawling, car-reliant suburbs, are designing more elder-friendly, walkable communities, far from “real” cities. Houses and apartments are built around village greens, with pockets of commerce instead of distant strip malls. Some have community centers for congregate meals and activities; others share gardens, where people can get their hands in the warm spring dirt long after they can push a lawn mower.

All of this is a step in the right direction, despite the Potemkin-village look of so many of them. But it doesn’t take into account those who are too infirm to stay at home, even in cities or more manageable suburban environments. Some are alone, others with a loving spouse who by comparison is “well” but may not be for long, given the rigors of care-taking. It doesn’t take into account people who can’t afford a home health aide, who don’t qualify for a visiting nurse, who have no adult children to help them or whose children live far away.

But by now, aging in place, unrealistic for some, scary or unsafe for others and potentially very isolating, has become so entrenched as the right way to live out one’s life that not being able to pull it off seems a failure, yet another defeat at a time when defeats are all too plentiful. Are we making people feel guilty if they can’t stay at home, or don’t want to? Are we discouraging an array of other solutions by investing so much, program-wise and emotionally, in this sine qua non?

Regular readers of The New Old Age know that I am single, childless and terrified of falling off a ladder while replacing a light bulb, breaking a hip and lying on the floor, unattended, until my dog wails so loudly a neighbor comes by to complain. A MedicAlert pendant is not something that appeals to me at 65, but even if I give in to that, say at 75, I’m not sure my life will be richer for digging my heels in and insisting home is where I should be.

So I spend a lot of time thinking about the alternatives. I know enough to distinguish between naturally-occurring-retirement communities, or NORCs (some of which work better than others); age-restricted housing complexes (with no services); assisted living (which works fine when you don’t really need it and not so fine when you do); and continuing care retirement communities (which require big upfront payments and extensive due diligence to be sure the place doesn’t go belly up after you get there).

What I find so unappealing about all these choices is that each means growing old among people with whom I share no history. In these congregate settings, for the most part, people are guaranteed only two things in common: age and infirmity. Which brings us to what is known in the trade as “affinity” or “niche” communities,” long studied by Andrew J. Carle at the College of Health and Human Services at George Mason University in Fairfax, Va.

Mr. Carle, who trains future administrators of senior housing complexes, was a media darling a few years back, before the recession, with the first baby boomers approaching 65 and niche communities that included services for the elderly — not merely warm-weather developments adjacent to golf courses — expected to explode. In newspaper interviews as recently as 2011, Mr. Carle said there were “about 100 of them in existence or on the drawing board,” not counting the large number of military old-age communities.

Mr. Carle still believes that better economic times, when they come, will reinvigorate this sector of senior housing, after the failure of some in the planning stages and others in operation. In an e-mail exchange, Mr. Carle said there were now about 70 in operation, with perhaps 50 of those that he has defined as University Based Retirement Communities, adjacent to campuses and popular with alumni, as well as non-alumni, who enjoy proximity to the intellectual and athletic activities. Among the most popular are those near Dartmouth, Oberlin, the University of Alabama, Penn State, Notre Dame, Stanford and Cornell.

At the height of the “affinity” boom, L.G.B.T.-assisted living communities and nursing homes were all the rage, seen as a solution to the shoddy treatment that those of different sexual orientations in the pre-Stonewall generation experienced in generic facilities. A few failed, most never got built and, by all accounts, the only one to survive is the pricy Rainbow Vision community in Sante Fe, N.M.

A handful of nudist elder communities, and ones for old hippies, also fell by the wayside, perhaps too free-spirited for the task. According to Mr. Carle, despite the odds, at least one group of RV enthusiasts has added an assisted-living component to what began as collections of transient elderly, looking only for a parking spot and necessary water and power hook-ups for their trailers. Native Americans have made a go of an assisted-living community in Montana, and Asians have done the same in Northern California.

But professional affinity communities, which I find most appealing, are few and far between.

The storied Motion Picture & Television Country House and Hospital, a sliding-scale institution in the San Fernando Valley since 1940, survived near-closure in 2009 as a result of litigation, activism by the Screen Actors Guild and the local chapter of the Teamsters, and news media pressure. Among film legends who died there — along with cameramen, back-lot security guards and extras — were Mary Astor, Joel McCrea, Yvonne De Carlo and Stepin Fetchit.

New York State’s volunteer firefighters are all welcome to a refurbished facility in the Catskill region that offers far more in the way of care and activities, including a state-of-the-art gym, than when I visited there five years ago. At that time, the residents amused themselves by activating the fire alarm to summon the local hook and ladder company, which didn’t mind a bit.

Then there is Nalcrest, the retirement home for unionized letter carriers. Even as post offices nationwide are preparing to eliminate Saturday service, and snail mail becomes an artifact, the National Association of Letter Carriers holds monthly fees around the $500 mark, is located in central Florida so its members no longer have to brave rain and sleet to complete their appointed rounds, and bans dogs, the bane of their existence.

So why not aged journalists? We surely have war stories to embroider as we rock on the porch. Perhaps a mimeograph machine to produce an old-fashioned, dead-tree newspaper, which some of us will miss once it has given way to Web sites like this one. Pneumatic tubes, one colleague suggested, to whisk our belongings upstairs when we can no longer carry them. Other colleagues wondered about welcoming both editors and reporters. How can these two groups, which some consider natural adversaries, complain about each others’ tin ears or missed deadlines if we’re not segregated?

I disagree. The joy of this profession is its collaboration. We did the impossible day after day when young. We belong together when old.

---

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The New Old Age Blog: Why Can’t I Live With People Like Me?

“Aging in place” is the mantra of long-term care. Whether looking at reams of survey data, talking to friends or wishing on a star, who among us wouldn’t rather spend the final years — golden or less so — at home, surrounded by our cherished possessions, in our own bed, no cranky old coot as a roommate, no institutional smells or sounds, no lukewarm meals on a schedule of someone else’s making?

That works best, experts tell us, in dense cities, where we can hail a cab at curbside, call the superintendent when something breaks and have our food delivered from Fresh Direct or countless takeout restaurants. We’d have neighbors in the apartment above us, below us, just on the other side of the wall. Hearing their toilets flush and their children ride tricycles on uncarpeted floors is a small inconvenience compared to the security of knowing they are so close by in an emergency.

Urban planners, mindful that most Americans live in sprawling, car-reliant suburbs, are designing more elder-friendly, walkable communities, far from “real” cities. Houses and apartments are built around village greens, with pockets of commerce instead of distant strip malls. Some have community centers for congregate meals and activities; others share gardens, where people can get their hands in the warm spring dirt long after they can push a lawn mower.

All of this is a step in the right direction, despite the Potemkin-village look of so many of them. But it doesn’t take into account those who are too infirm to stay at home, even in cities or more manageable suburban environments. Some are alone, others with a loving spouse who by comparison is “well” but may not be for long, given the rigors of care-taking. It doesn’t take into account people who can’t afford a home health aide, who don’t qualify for a visiting nurse, who have no adult children to help them or whose children live far away.

But by now, aging in place, unrealistic for some, scary or unsafe for others and potentially very isolating, has become so entrenched as the right way to live out one’s life that not being able to pull it off seems a failure, yet another defeat at a time when defeats are all too plentiful. Are we making people feel guilty if they can’t stay at home, or don’t want to? Are we discouraging an array of other solutions by investing so much, program-wise and emotionally, in this sine qua non?

Regular readers of The New Old Age know that I am single, childless and terrified of falling off a ladder while replacing a light bulb, breaking a hip and lying on the floor, unattended, until my dog wails so loudly a neighbor comes by to complain. A MedicAlert pendant is not something that appeals to me at 65, but even if I give in to that, say at 75, I’m not sure my life will be richer for digging my heels in and insisting home is where I should be.

So I spend a lot of time thinking about the alternatives. I know enough to distinguish between naturally-occurring-retirement communities, or NORCs (some of which work better than others); age-restricted housing complexes (with no services); assisted living (which works fine when you don’t really need it and not so fine when you do); and continuing care retirement communities (which require big upfront payments and extensive due diligence to be sure the place doesn’t go belly up after you get there).

What I find so unappealing about all these choices is that each means growing old among people with whom I share no history. In these congregate settings, for the most part, people are guaranteed only two things in common: age and infirmity. Which brings us to what is known in the trade as “affinity” or “niche” communities,” long studied by Andrew J. Carle at the College of Health and Human Services at George Mason University in Fairfax, Va.

Mr. Carle, who trains future administrators of senior housing complexes, was a media darling a few years back, before the recession, with the first baby boomers approaching 65 and niche communities that included services for the elderly — not merely warm-weather developments adjacent to golf courses — expected to explode. In newspaper interviews as recently as 2011, Mr. Carle said there were “about 100 of them in existence or on the drawing board,” not counting the large number of military old-age communities.

Mr. Carle still believes that better economic times, when they come, will reinvigorate this sector of senior housing, after the failure of some in the planning stages and others in operation. In an e-mail exchange, Mr. Carle said there were now about 70 in operation, with perhaps 50 of those that he has defined as University Based Retirement Communities, adjacent to campuses and popular with alumni, as well as non-alumni, who enjoy proximity to the intellectual and athletic activities. Among the most popular are those near Dartmouth, Oberlin, the University of Alabama, Penn State, Notre Dame, Stanford and Cornell.

At the height of the “affinity” boom, L.G.B.T.-assisted living communities and nursing homes were all the rage, seen as a solution to the shoddy treatment that those of different sexual orientations in the pre-Stonewall generation experienced in generic facilities. A few failed, most never got built and, by all accounts, the only one to survive is the pricy Rainbow Vision community in Sante Fe, N.M.

A handful of nudist elder communities, and ones for old hippies, also fell by the wayside, perhaps too free-spirited for the task. According to Mr. Carle, despite the odds, at least one group of RV enthusiasts has added an assisted-living component to what began as collections of transient elderly, looking only for a parking spot and necessary water and power hook-ups for their trailers. Native Americans have made a go of an assisted-living community in Montana, and Asians have done the same in Northern California.

But professional affinity communities, which I find most appealing, are few and far between.

The storied Motion Picture & Television Country House and Hospital, a sliding-scale institution in the San Fernando Valley since 1940, survived near-closure in 2009 as a result of litigation, activism by the Screen Actors Guild and the local chapter of the Teamsters, and news media pressure. Among film legends who died there — along with cameramen, back-lot security guards and extras — were Mary Astor, Joel McCrea, Yvonne De Carlo and Stepin Fetchit.

New York State’s volunteer firefighters are all welcome to a refurbished facility in the Catskill region that offers far more in the way of care and activities, including a state-of-the-art gym, than when I visited there five years ago. At that time, the residents amused themselves by activating the fire alarm to summon the local hook and ladder company, which didn’t mind a bit.

Then there is Nalcrest, the retirement home for unionized letter carriers. Even as post offices nationwide are preparing to eliminate Saturday service, and snail mail becomes an artifact, the National Association of Letter Carriers holds monthly fees around the $500 mark, is located in central Florida so its members no longer have to brave rain and sleet to complete their appointed rounds, and bans dogs, the bane of their existence.

So why not aged journalists? We surely have war stories to embroider as we rock on the porch. Perhaps a mimeograph machine to produce an old-fashioned, dead-tree newspaper, which some of us will miss once it has given way to Web sites like this one. Pneumatic tubes, one colleague suggested, to whisk our belongings upstairs when we can no longer carry them. Other colleagues wondered about welcoming both editors and reporters. How can these two groups, which some consider natural adversaries, complain about each others’ tin ears or missed deadlines if we’re not segregated?

I disagree. The joy of this profession is its collaboration. We did the impossible day after day when young. We belong together when old.

---

Read More..

Gadgetwise Blog: App Smart Extra: Starry Night

Stars, galaxies, meteors and satellites were the subject of App Smart this week as I tested out astronomy apps to help identify objects in the night sky. These apps typically use your phone or tablet’s sensors to display a view of what you’re pointing your device at in the sky in real time, helping you identify planets and constellations. Here are more apps like this to try out:

Star Walk — 5 Stars Astronomy Guide is a popular iOS app, costing $3. It has the same kind of dynamic star display as other apps in its class, and it’s easy to use. It’s also jam-packed with imagery and data on the 200,000 stars and planets in its database, and has a calendar so you can keep track of interesting celestial events. I particularly like the beautiful imagery it uses to show constellations and detail on the planets.

SkySafari 3 may be useful for more experienced star gazers. It has data on 120,000 stars and 220 star clusters, nebulae and galaxies, as well as detailed information pages written by professional astronomers. The basic version costs $3 on iOS, but there’s a Plus edition for $15 that has data on 2.5 million stars and can control some wired and wireless telescopes. The Pro edition is $40 and has many more stars and features but is aimed at the serious amateur astronomer.

Alternatively, and much more simply, there’s SkEye Astronomy, available as a free Android app. It has a businesslike feel, and is slightly sparing on user interface touches like icons. But it is powerful, and essentially works in much the same way as Star Walk or SkySafari does. There’s a $9 SkEye Pro version that has more stars in its database and can help you spot satellites too. But the free edition is fine for the casual astronomer. The app is not ideal you’re a complete beginner, however, as it lacks the kind of detailed background data on stars and so on that similar apps have.

The benefit to stargazing apps like these is that they also work during the day, or in a city that’s too light-polluted to let you see more than a handful of stars. This means you can turn them on at any time to learn more about astronomy.

Quick call: The Popular instant messaging app WhatsApp has been updated to a new version for Windows Phone 8. It has better support for Windows Live Tile displays and extras like a back-up system.

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At War Blog: Remembering a Silent Success in Afghanistan

December in the mountains of southern Afghanistan greeted me and my men with strong and seemingly endless gusts of wind. The frigid temperatures were equally unforgiving. Our living quarters were constructed out of cardboard boxes and plastic sheeting, which didn’t create much of an escape. The highlight of my day, despite the obvious threat, was leading patrols as a squad leader. The physical activity kept me comfortably warm and allowed me to distance my mind from our frosty reality.

Despite daily patrols, it took me a few months to build rapport with the residents of Kunjak in Helmand Province. During the first month of my deployment in 2010, barely any villagers talked to me. This is when my interpreter, who we called H.B., suggested I start inviting the elders to our base for a meeting, or shura. He assured me this would build a mutual trust.

Soon, my Sunday mornings consisted of two to three hours of conversing with dozens of village elders. At 9 a.m., my interpreter and I would greet them as they climbed the steep and sandy hill to my remote outpost. To present a less hostile environment, I chose to meet them without my body armor or weapon.

We sat outside, suffering in the wind together. My interpreter would make chai, but I always brewed a pot of Starbucks coffee and offered some to my guests. Some liked it, some didn’t. I would like to think my generosity was appreciated.

The shuras were full of requests for new wells and mosques. But if there are two things Afghanistan has a plethora of, it’s those two things. I chose to propose something different, which thrilled them all.

We would build a school.

The Taliban had prevented them from being able to send their kids to school for years. With one suggestion, I had won over the villagers.

As the sun rose the following day, despite not having a school yet, I had over a dozen children waiting outside my base. Many had traveled from afar to attend what they thought was the first day of class. The last thing I wanted to do was send the children away. We invited them on the base, and H.B. taught them the Pashtu alphabet on our dry-erase board. It was on that Monday morning I realized I had to do something fast.

Our supplies were stored in a small tent at the back of our outpost, but I made the decision to move the tent to the base of our hill to serve as the school. By positioning it there, we could maintain its security, protecting it from Taliban attacks.

At 8:45 every morning, my Marines patrolled the school and used our metal detectors to sweep for improvised explosive devices. The safety of the children had to be paramount or our efforts would be for nothing. As the days passed, a growing number of children ranging in the age from 4 to 10 arrived for school. Within weeks we were teaching more than 40 boys and girls. During our time in Afghanistan, not a single child was injured at our school, and for the last four months of my deployment, the school was a giant success.

The Afghan National Police officers attached to my outpost did not participate much in the security of the school. In fact, many of them disapproved of it because it catered to girls as well as boys. I fear that as the American military presence draws down in Afghanistan, initiatives like our school will be abandoned by the Afghan government or destroyed by the Taliban. While the district mayor of Musa Qala knew of our efforts at the school, we received little to no local government support. Requests for a teacher, supplies and a permanent structure were either ignored or forgotten.

Stories like the one of our school tend to never make the limelight. Far too often the news is only about the horrors of war, or mistakes made by NATO troops, rather than their successes. It is easy to focus on the negative, especially as the United States plans to withdraw most of its forces by the end of 2014.

As I left Afghanistan in the spring of 2011, dozens of Afghans were attending our shuras, and they were full of varying requests. They no longer asked for wells and mosques. Now they wanted a community center and a larger school. I left before I could make those dreams come true for them. But I hoped the Marines who relieved me would be able to fulfill them.

I came home and listened and watched the news a lot. I kept hoping I would see or hear something good from Afghanistan. To no avail; the stories were depressing. After spending seven months in Afghanistan, I now knew good things were happening, but they just weren’t being shown.

I hope that my school wasn’t short-lived, and I would like to think that it is still operating safely. Whether it is or not, I still fondly remember our efforts. They led to one of the silent successes that have happened and, I believe, will continue to happen in Afghanistan.

Thomas James Brennan is a military affairs reporter with the Daily News in Jacksonville, N.C. Before being medically retired this fall, he was a sergeant in the Marine Corps stationed at Camp Lejeune, N.C. He served in Iraq and Afghanistan with the First Battalion, Eighth Marines, and is a member of the Military Order of the Purple Heart. Follow him on Twitter at @thomasjbrennan.

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DealBook: For S.E.C., a Setback in Bid for More Time in Fraud Cases

The Supreme Court on Wednesday delivered a swift and decisive rejection of the Securities and Exchange Commission’s argument that it should operate under a more forgiving statute of limitations in pursuing penalties in fraud cases.

As a result of the decision, the agency will have to find a long-term solution to give itself more time to investigate cases.

In Gabelli v. Securities and Exchange Commission, Chief Justice John G. Roberts Jr. wrote in the unanimous decision rejecting the S.E.C.’s argument that a federal statute that limits the government’s authority to pursue civil penalties should commence when a fraud is discovered, not when it occurred.

The S.E.C. was hoping that the court would apply what is known as the “discovery rule.” In 2010, the Supreme Court endorsed this rule in a private securities fraud class-action suit, Merck & Co. v. Reynolds, stating “that something different was needed in the case of fraud, where a defendant’s deceptive conduct may prevent a plaintiff from even knowing that he or she has been defrauded.”

The discovery rule is an exception to the protection afforded by a statute of limitations, which puts an endpoint on potential legal liability for conduct. Unlike most cases, when fraud is involved, it may not be apparent to the victims that they were harmed because the primary goal of deceptive conduct is to keep it from being exposed.

In the Gabelli case, the S.E.C. filed fraud charges in 2008 against the mutual fund manager Marc Gabelli and a colleague, Bruce Alpert, saying they had violated the Investment Advisers Act of 1940 for permitting an investor to engage in market timing. Ten years ago, a major scandal erupted when it came to light that some advisers had permitted select investors to buy shares at favorable prices to take advantage of pricing disparities in the securities held by mutual funds.

In its complaint, the S.E.C. sought civil monetary penalties based on market timing that it claimed had taken place from 1999 to 2002, and resulted in the preferred investor purportedly reaping significant profits while ordinary investors suffered large losses. The defendants denied the charges and filed a motion to dismiss the case because it was not brought in time.

A federal statute, 28 U.S.C. § 2462, provides that “an action, suit or proceeding for the enforcement of any civil fine, penalty, or forfeiture, pecuniary or otherwise, shall not be entertained unless commenced within five years from the date when the claim first accrued.” The provision dates to 1839, and applies to any government agency.

A decision by the United States Court of Appeals for the Second Circuit in Manhattan allowed the case to proceed by applying the discovery rule to a governmental action. Coincidentally, that decision was written by Judge Jed S. Rakoff, who despite being an occasional thorn in the S.E.C.’s side, accepted the agency’s argument to avoid a strict application of the five-year statute of limitations.

The Supreme Court, however, saw things differently. This week, it issued its opinion less than two months after it heard oral argument in the case in January, a clear sign the justices found no merit in the S.E.C.’s contention that the agency should be treated the same as private plaintiffs in trying to get around the statute of limitations.

According to the Supreme Court, victims in securities fraud cases should have a longer period to file a claim – from when the fraud was discovered. “Most of us do not live in a state of constant investigation,” the court wrote. “Absent any reason to think we have been injured, we do not typically spend our days looking for evidence that we were lied to or defrauded.”

Chief Justice Roberts explained that “the S.E.C. as enforcer is a far cry from the defrauded victim the discovery rule evolved to protect.” One of the reasons the agency exists is to detect and penalize violations, with tools that the ordinary investor simply does not have, like the authority to compel testimony and the production of documents. The message is simple. When it’s your job to investigate fraud, you cannot argue that your failure to do so is a justification for not meeting a statute of limitations.

The Supreme Court’s decision puts increased pressure on the S.E.C. to pursue its investigations with greater alacrity and not let them gather dust, which can occur as a result of staff turnover or other pressing issues. The market timing case is a good example of how an investigation might get lost in the shuffle as corporate accounting frauds at large companies like Enron and WorldCom, which also came to light in 2002, strained the S.E.C.’s investigative resources.

There are a couple of options to deal with this issue in the long run, apart from a substantial increase in the agency’s budget – an unlikely prospect in the face of the looming federal budget sequestration deadline.

The S.E.C. can obtain an agreement to stop the statute of limitations, known as tolling, from those it is investigating, something it has done in the past. For example, in its insider trading and securities fraud case against Samuel E. Wyly, his now deceased brother, Charles J. Wyly Jr., and two other defendants, the S.E.C. got an agreement that let it pursue claims beyond the normal five-year limitations period.

A permanent solution would be to seek legislation from Congress that would give the S.E.C. a longer window to complete its investigations. The statute of limitations is not a constitutional protection, so Congress can amend it as it sees fit, which it has done in other areas involving fraud.

The limitations period for banking crimes, for example, was extended to 10 years during the savings and loan crisis because of the crush of cases that made it difficult to finish investigations in the five-year window to initiate criminal prosecutions. The Fraud Enforcement and Recovery Act of 2009 added mail and wire fraud affecting a financial institution to the list of crimes that get the benefit of the 10-year limitations period, again because of fear that cases would be lost because of the number of investigations taking place after the financial crisis.

The issue of the statute of limitations may even come up at the confirmation hearings of Mary Jo White, who has been nominated to be chairwoman of the S.E.C. That could be an early indicator of whether she would be willing to push for relief from the effect of the Gabelli opinion to help out the enforcement division.

In the short run, the Supreme Court’s decision will cause defendants in government enforcement actions to examine whether they might be able to take advantage of the five-year limitations period. Given how slowly the government has been known to move on occasion, it may be that some cases will fall by the wayside because of the Gabelli decision.

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The New Old Age Blog: For the Elderly, Medical Procedures to Avoid

The Choosing Wisely campaign, an initiative by the American Board of Internal Medicine Foundation in partnership with Consumer Reports, kicked off last spring. It is an attempt to alert both doctors and patients to problematic and commonly overused medical tests, procedures and treatments.

It took an elegantly simple approach: By working through professional organizations representing medical specialties, Choosing Wisely asked doctors to identify “Five Things Physicians and Patients Should Question.”

The idea was that doctors and their patients could agree on tests and treatments that are supported by evidence, that don’t duplicate what others do, that are “truly necessary” and “free from harm” — and avoid the rest.

Among the 18 new lists released last week are recommendations from geriatricians and palliative care specialists, which may be of particular interest to New Old Age readers. I’ve previously written about a number of these warnings, but it’s helpful to have them in single, strongly worded documents.

The winners — or perhaps, losers?

Both the American Geriatrics Society and the American Academy of Hospice and Palliative Medicine agreed on one major “don’t.” Topping both lists was an admonition against feeding tubes for people with advanced dementia.

“This is not news; the data’s been out for at least 15 years,” said Sei Lee, a geriatrician at the University of California, San Francisco, and a member of the working group that narrowed more than 100 recommendations down to five. Feeding tubes don’t prevent aspiration pneumonia or prolong dementia patients’ lives, the research shows, but they do exacerbate bedsores and cause such distress that people often try to pull them out and wind up in restraints. The doctors recommended hand-feeding dementia patients instead.

The geriatricians’ list goes on to warn against the routine prescribing of antipsychotic medications for dementia patients who become aggressive or disruptive. Though drugs like Haldol, Risperdal and Zyprexa remain widely used, “all of these have been shown to increase the risk of stroke and cardiovascular death,” Dr. Lee said. They should be last resorts, after behavioral interventions.

The other questionable tests and treatments:

No. 3: Prescribing medications to achieve “tight glycemic control” (defined as below 7.5 on the A1c test) in elderly diabetics, who need to control their blood sugar, but not as strictly as younger patients.

No. 4: Turning to sleeping pills as the first choice for older people who suffer from agitation, delirium or insomnia. Xanax, Ativan, Valium, Ambien, Lunesta — “they don’t magically disappear from your body when you wake up in the morning,” Dr. Lee said. They continue to slow reaction times, resulting in falls and auto accidents. Other sleep therapies are preferable.

No. 5: Prescribing antibiotics when tests indicate a urinary tract infection, but the patient has no discomfort or other symptoms. Many older people have bacteria in their bladders but don’t suffer ill effects; repeated use of antibiotics just causes drug resistance, leaving them vulnerable to more dangerous infections. “Treat the patient, not the lab test,” Dr. Lee said.

The palliative care doctors’ Five Things list cautions against delaying palliative care, which can relieve pain and control symptoms even as patients pursue treatments for their diseases.

It also urges discussion about deactivating implantable cardioverter-defibrillators, or ICDs, in patients with irreversible diseases. “Being shocked is like being kicked in the chest by a mule,” said Eric Widera, a palliative care specialist at the San Francisco V.A. Medical Center who served on the American Academy of Hospice and Palliative Medicine working group. “As someone gets close to the end of life, these ICDs can’t prolong life and they cause a lot of pain.”

Turning the devices off — an option many patients don’t realize they have — requires simple computer reprogramming or a magnet, not the surgery that installed them in the first place.

The palliative care doctors also pointed out that patients suffering pain as cancer spreads to their bones get as much relief, the evidence shows, from a single dose of radiation than from 10 daily doses that require travel to hospitals or treatment centers.

Finally, their list warned that topical gels widely used by hospice staffs to control nausea do not work because they aren’t absorbed through the skin. “We have lots of other ways to give anti-nausea drugs,” Dr. Widera said.

You can read all the Five Things lists (more are coming later this year), and the Consumer Reports publications that do a good job of translating them, on the Choosing Wisely Web site.

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Paula Span is the author of “When the Time Comes: Families With Aging Parents Share Their Struggles and Solutions.”

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The New Old Age Blog: For the Elderly, Medical Procedures to Avoid

The Choosing Wisely campaign, an initiative by the American Board of Internal Medicine Foundation in partnership with Consumer Reports, kicked off last spring. It is an attempt to alert both doctors and patients to problematic and commonly overused medical tests, procedures and treatments.

It took an elegantly simple approach: By working through professional organizations representing medical specialties, Choosing Wisely asked doctors to identify “Five Things Physicians and Patients Should Question.”

The idea was that doctors and their patients could agree on tests and treatments that are supported by evidence, that don’t duplicate what others do, that are “truly necessary” and “free from harm” — and avoid the rest.

Among the 18 new lists released last week are recommendations from geriatricians and palliative care specialists, which may be of particular interest to New Old Age readers. I’ve previously written about a number of these warnings, but it’s helpful to have them in single, strongly worded documents.

The winners — or perhaps, losers?

Both the American Geriatrics Society and the American Academy of Hospice and Palliative Medicine agreed on one major “don’t.” Topping both lists was an admonition against feeding tubes for people with advanced dementia.

“This is not news; the data’s been out for at least 15 years,” said Sei Lee, a geriatrician at the University of California, San Francisco, and a member of the working group that narrowed more than 100 recommendations down to five. Feeding tubes don’t prevent aspiration pneumonia or prolong dementia patients’ lives, the research shows, but they do exacerbate bedsores and cause such distress that people often try to pull them out and wind up in restraints. The doctors recommended hand-feeding dementia patients instead.

The geriatricians’ list goes on to warn against the routine prescribing of antipsychotic medications for dementia patients who become aggressive or disruptive. Though drugs like Haldol, Risperdal and Zyprexa remain widely used, “all of these have been shown to increase the risk of stroke and cardiovascular death,” Dr. Lee said. They should be last resorts, after behavioral interventions.

The other questionable tests and treatments:

No. 3: Prescribing medications to achieve “tight glycemic control” (defined as below 7.5 on the A1c test) in elderly diabetics, who need to control their blood sugar, but not as strictly as younger patients.

No. 4: Turning to sleeping pills as the first choice for older people who suffer from agitation, delirium or insomnia. Xanax, Ativan, Valium, Ambien, Lunesta — “they don’t magically disappear from your body when you wake up in the morning,” Dr. Lee said. They continue to slow reaction times, resulting in falls and auto accidents. Other sleep therapies are preferable.

No. 5: Prescribing antibiotics when tests indicate a urinary tract infection, but the patient has no discomfort or other symptoms. Many older people have bacteria in their bladders but don’t suffer ill effects; repeated use of antibiotics just causes drug resistance, leaving them vulnerable to more dangerous infections. “Treat the patient, not the lab test,” Dr. Lee said.

The palliative care doctors’ Five Things list cautions against delaying palliative care, which can relieve pain and control symptoms even as patients pursue treatments for their diseases.

It also urges discussion about deactivating implantable cardioverter-defibrillators, or ICDs, in patients with irreversible diseases. “Being shocked is like being kicked in the chest by a mule,” said Eric Widera, a palliative care specialist at the San Francisco V.A. Medical Center who served on the American Academy of Hospice and Palliative Medicine working group. “As someone gets close to the end of life, these ICDs can’t prolong life and they cause a lot of pain.”

Turning the devices off — an option many patients don’t realize they have — requires simple computer reprogramming or a magnet, not the surgery that installed them in the first place.

The palliative care doctors also pointed out that patients suffering pain as cancer spreads to their bones get as much relief, the evidence shows, from a single dose of radiation than from 10 daily doses that require travel to hospitals or treatment centers.

Finally, their list warned that topical gels widely used by hospice staffs to control nausea do not work because they aren’t absorbed through the skin. “We have lots of other ways to give anti-nausea drugs,” Dr. Widera said.

You can read all the Five Things lists (more are coming later this year), and the Consumer Reports publications that do a good job of translating them, on the Choosing Wisely Web site.

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Paula Span is the author of “When the Time Comes: Families With Aging Parents Share Their Struggles and Solutions.”

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Bits Blog: One on One: Sugata Mitra, 2013 TED Prize Winner

Are teachers keeping students from learning in the digital age? Sugata Mitra, a professor of educational technology at Newcastle University, believes so. Dr. Mitra is best known for an experiment in which he carved a hole from his research center in Delhi into an adjacent slum, placing a freely accessible computer there for children to use.

The children quickly taught themselves basic computer skills. The “hole in the wall” experiment, as it is known, led Dr. Mitra to develop the idea of learning environments in which teachers would merely be supervisors as children taught themselves by working together at computer terminals. On Tuesday Dr. Mitra was given the 2013 TED Prize, which grants him $1 million to build a learning laboratory based on this principle.

Q.

What did you learn from the original “hole in the wall” experiment?

A.

The first thing to point out is that it was done 14 years ago, at a time when few children in India had access to computers. I noticed the rich parents saying that their sons and daughters must be gifted, because they were so good with computers. And since we know that gifted kids are not born only to rich parents, why would there not be similar children in the slums? I was curious to see what would happen if I gave an Internet-connected computer to the kind of kids who never had one.

We noticed that they learned how to surf within hours. It was a bit of a surprise. Long story short, they would teach themselves whatever they had to to use the computer, such was the attraction of the machine.

Q.

What does this mean for education?

A.

In those days, the main question was what does it mean for training, because back then people were trained to use computers. So I said it looks like we don’t have to do that.

But I got curious about the fact that the children were teaching themselves a smattering of English. So I started doing a whole range of experiments, and I found that if you left them alone, working in groups, they could learn almost anything once they’ve gotten used to the fact that you can research on the Internet. This was done between 2000 and 2006.

I came to England in 2006, and the schools said, why aren’t you doing it here? So I did, and I realized that what I’ve got has nothing to do with poor children. It probably is just a new way in which children learn in this new environment. It needs two things. First, broadband. That’s fine, everybody loves that. The second thing is, it needs the teacher to stand back.

At first I thought that the children were learning in spite of the teacher not interfering. But I changed my opinion, and realized this was happening because the teacher was not interfering. At that point, I didn’t become entirely popular with teachers. But I explained to them that the job has changed. You ask the right kind of question, then you stand back and let the learning happen.

Q.

Do schools need to be radically changed to implement this, or is this a technique that fits into the current structure of schools?

A.

At the moment I pitch it as a technique that you can bring into your schools. But that’s not the real story, which is that the current schooling system is a leftover from the Victorian age of empire. In that world, there were no computers, no telegraphs and data was carried around on ships. This meant that the pillars of education were reading, writing and arithmetic. That age is gone. The system was wonderfully engineered, but we don’t need it anymore; we need something else. But you can’t just say that without saying how you do it.

What I’m doing is I’m putting my foot in the door by saying here’s a new way. Try it. If you’re happy with it, then I’ll say let’s look at the curriculum top to bottom. If we can convert the curriculum into big questions, if we can turn assessment into peer assessment, then neurophysiology tells us that learning gets enhanced. Finally, if you add admiration — what I call the grandmother’s method, where you stand behind and encourage them. Put all of this together and you get a new way to do schooling.

Q.

So it seems that you’re saying we don’t need teachers at all.

A.

We need teachers to do different things. The teacher has to ask the question, and tell the children what they have learned. She comes in at the two ends, a cap at the end and a starter at the beginning.

Teachers are not supposed to be repositories of information which they dish out. That is from an age when there were no other repositories of information, other than books or teachers, neither of which were portable. A lot of my big task is retraining these teachers. Now they have to watch as children learn.

Q.

Is there a problem with this in that it will serve the good students well, but leave those who need more coaching behind?

A.

Well, yes, to some extent. But there are some interesting things about children working in groups if those groups are self-made. Once you let children do that, the system has a self-correcting ability. Having said that, will there be good students and bad students? Of course.

Q.

Does this work for all levels of instruction?

A.

It doesn’t work the same way with adolescents, and definitely not with adults. With 8- to 12-year-olds, that’s the age where big questions turn them on.

Q.

What are your specific plans with the prize?

A.

In order to see if this sort of self-organized learning environment is suitable I need to have one in which I have some control over and can do measurements with. So I want to build one of these learning spaces somewhere.

It will be totally automatic, completely controlled from the cloud. There will be a supervisor, but that person is not going to be a computer expert or a teacher in anything. She — and it will probably be a she — will be there only for health and safety requirements.

The rest of the school, if we call it a school, is a facility that I can hand over to a mediator from the cloud. She logs in from her home, wherever her home is, and she’s able to control everything inside, the lights, the air-conditioning, you name it. Then there are four mediators who Skype in and use the pedagogical method. That’s going to take a lot of work.

The second bit is that schools all over the world have been using this method. We need to do a massive multiplication, and TED is going to help me do that. I am going to try to put that into homes; get your children and their friends together. Then, every time they do it, I’ll ask them to collect data and send it to a Web site. If I succeed, in two years I’ll have massive data from all over the world. By that time I’ll be done building the facility and I’ll be ready to build a new model.

Q.

Where do you think this school will be?

A.

I’d like to do it in India, because I’d know how to get it done. There will be less of a learning curve, I know who the contractors are, and I know how not to get cheated. So I’d like to do it there, but it’s not set in stone.

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