Fresh Produce Discussion Blog

Created by The Packer's National Editor Tom Karst

Friday, February 26, 2010

Bribes Let Tomato Vendor Sell Tainted Food - NYT

Bribes Let Tomato Vendor Sell Tainted Food - NYT

Robert Watson, a top ingredient buyer for Kraft Foods, needed $20,000 to pay his taxes. So he called a broker for a California tomato processor that for years had been paying him bribes to get its products into Kraft’s plants.

he check would soon be in the mail, the broker promised. “We’ll have to deduct it out of your commissions as we move forward,” he said, using a euphemism for bribes.

Days later, federal agents descended on Kraft’s offices near Chicago and confronted Mr. Watson. He admitted his role in a bribery scheme that has laid bare a startling vein of corruption in the food industry. And because the scheme also involved millions of pounds of tomato products with high levels of mold or other defects, the case has raised serious questions about how well food manufacturers safeguard the quality of their ingredients.

Over the last 14 months, Mr. Watson and three other purchasing managers, at Frito-Lay, Safeway and B&G Foods, have pleaded guilty to taking bribes. Five people connected to one of the nation’s largest tomato processors, SK Foods, have also admitted taking part in the scheme.

Now, federal prosecutors in California have taken aim at the owner of SK Foods, who they say spearheaded the far-reaching plot. The man, Frederick Scott Salyer, was arrested at Kennedy Airport in New York City on Feb. 4 after getting off a flight from Switzerland. He was indicted last week on racketeering, fraud and obstruction of justice charges.

The scheme, as laid out by federal prosecutors, has two parts. Officials say that Mr. Salyer and others at SK Foods greased the palms of a handful of corporate buyers in exchange for lucrative contracts and confidential information on bids submitted by competitors. This most likely drove up ingredient prices for the big food companies.

In addition, prosecutors say that for years, SK Foods shipped its customers millions of pounds of bulk tomato paste and puree that fell short of basic quality standards — with falsified documentation to mask the problems. Often that meant mold counts so high the sale should have been prohibited under federal law; at other times it involved breaching specifications in the sales contracts, such as acidity levels or the age of the product.

The scope of the tainted shipments was much broader than the bribery scheme, touching more than 55 companies. In some cases, companies detected problems and sent the products back — but in many cases, according to prosecutors, they did not, and the tainted ingredients wound up in food sold to consumers.

Prosecutors said that no one was sickened by the mold-tainted products and that they were not a health risk.

Benjamin B. Wagner, the United States attorney in Sacramento, whose office has led the investigation, said he was also looking at allegations of collusion and price fixing involving SK Foods and other tomato processors.

“If you have a couple of people who are willing to bend the rules and they set that tone from the top, that can spread very quickly in that company and in that niche of the industry, and that’s what happened here,” Mr. Wagner said.

Malcolm Segal, a lawyer for Mr. Salyer, said his client had done nothing wrong. “The allegations against Mr. Salyer are unsupported except by individuals who have pled guilty and who are seeking a personal benefit in the sentencing process,” Mr. Segal said.

Randy W. Worobo, an associate professor of food microbiology at Cornell University, said companies should learn from the SK Foods case that they must do a better job of monitoring their ingredients.

“There’s been a lot of hype about inferior-quality products being made in China and then sold to the U.S. consumer,” Mr. Worobo said. “This is exactly the same thing, but it’s based in the U.S.”

Prosecutors say that Mr. Salyer ran the fraud along with Randall Rahal, a New Jersey businessman who acted as a broker for SK Foods, negotiating deals with many of the firm’s largest customers.

It was Mr. Rahal who made the contacts with the four buyers who took bribes. He was caught on a wiretap in April 2008, promising to help Mr. Watson with his tax payment, according to court papers. In another conversation, reported by a witness, Mr. Rahal explained the art of ascertaining whether a person would be susceptible to bribery.

According to court papers, Mr. Rahal recounted how he would drop a $100 bill on the floor, then bend to pick it up, saying: “You must have dropped this. Is it yours?” If the person said yes, Mr. Rahal considered him receptive. Mr. Rahal pleaded guilty to racketeering, price fixing and money laundering charges in December 2008 and has been cooperating with investigators. His lawyer, Christopher D. Adams of New Jersey, did not respond to requests for comment.


Mr. Rahal is accused of bribing ingredient buyers as early as 1998. One of those he is said to have drawn in was a New Jersey buyer named Robert C. Turner Jr., who began taking bribes while working as a purchasing manager at Nabisco. In 2004 he went to work for B&G Foods, the maker of Ortega Mexican foods and other products, in Parsippany, N.J. Mr. Turner continued to take bribes as he rose to become B&G’s director of purchasing.


Mr. Turner, an Eagle Scout, confessed to taking more than $65,000 in bribes in all. He pleaded guilty last May to mail fraud charges related to bribe checks he received in the mail. Mr. Turner’s lawyer, John A. Azzarello of New Jersey, said Mr. Turner was not aware that SK Foods was shipping tomatoes with high mold counts and other defects.

In one case in 2007, Mr. Turner raised the price B&G paid on a contract to finance his own kickback. In that deal, B&G agreed to buy 13 million pounds of peppers from SK Foods at 22 cents a pound. But at Mr. Rahal’s urging, Mr. Turner added an extra penny a pound. The pair agreed to “split the penny,” meaning that each of them would pocket half a cent a pound, for a total of $65,000 apiece.

Kraft, the nation’s largest food manufacturer, appears to have been among the biggest companies skimmed by the bribes. Court papers say that Kraft bought about 230 million pounds of processed tomatoes from SK Foods from 2004 to 2008, as Mr. Watson took $158,000 in bribes.

Mr. Watson did not cooperate with investigators and is so far the only person sentenced in the case. He is serving a 27-month prison term and has been ordered to make $1.8 million in restitution to Kraft. A request to meet with Mr. Watson in prison was submitted to his lawyer, Thomas J. Organ of Illinois, who did not respond to follow-up calls.

The products Mr. Watson bought often came at inflated prices, according to prosecutors. When they arrived, they were sometimes tainted with mold.

In 2007, faced with a product shortage, Mr. Salyer allegedly ordered subordinates to ship 3.4 million pounds of moldy tomato paste to Kraft. It was accompanied by documentation falsely claiming that it met federal mold limits.

Renee Zahery, a Kraft spokeswoman, said the company was a victim of SK Foods’ fraud and stressed that there were no health risks in using the moldy paste.

She said that while the company did a variety of tests on the ingredients it used, for mold it relied on the tests by suppliers.

“We do not duplicate those efforts,” Ms. Zahery said in an e-mail exchange. “We take our responsibility for quality seriously and believe the SK Foods situation was an anomaly.”

Another Kraft spokeswoman, Susan Davison, said that in 2007 and 2008, Kraft sent a quality expert to monitor SK Foods’ operations because of other quality concerns, like excessive tomato skins in their products.

Ms. Zahery said that the company tested all its finished products for possible food safety hazards and that no problems were found with products made with SK Foods ingredients.

Michael P. Doyle, the director of the Center for Food Safety at the University of Georgia, said there had been several cases in recent years in which ingredient suppliers were suspected of falsifying documentation to mask quality or safety faults in foods, especially with imports. He said that should make companies more aggressive in testing, not only to guard against pathogens but also to check quality.

“As a consumer I wouldn’t want to have moldy tomatoes in my tomato ketchup or my tomato products,” Dr. Doyle said.

Mr. Wagner, the federal prosecutor, said SK Foods employees who shipped out falsely labeled products were aware of how alert each food company was, or was not. “They had a pretty good sense of who you can fool and in what way,” Mr. Wagner said.

SK Foods was forced into bankruptcy by its creditors last May. Its two processing plants were bought by Olam International of Singapore, which operates them as Olam Tomato Processors.

Wednesday, February 24, 2010

Wal-Mart Opening 35 to 40 Canada Supercenters in 2010

Wal-Mart Opening 35 to 40 Canada Supercenters in 2010

By Tian Huang

Feb. 23 (Bloomberg) -- Wal-Mart Stores Inc., the world’s largest retailer, said it plans to open 35 to 40 supercenters in Canada in 2010.

The projects, which entail creating new stores and relocating existing ones, will cost just under C$500 million ($473.2 million) and generate about 6,500 store and construction jobs, the Bentonville, Arkansas-based company said today in a statement. Specific store locations were not disclosed.

The expansion will bring Wal-Mart’s presence in Canada to as many as 325 stores by the year’s end from the current 317 stores. Wal-Mart closed six Canadian Sam’s Club warehouse stores in March to focus on the supercenter format, Andrew Pelletier, a spokesman, said today by telephone.

Wal-Mart is also investing C$115 million in a sustainable, refrigerated distribution center in Balzac, Alberta. The retailer said today it expects the center, which will create 1,400 jobs, to open in the fall.

Wal-Mart fell 21 cents to $53.62 at 4 p.m. in New York Stock Exchange composite trading. The shares dropped 4.7 percent last year.

Supermarket pubs: Bar hopping meets grocery shopping - Philly.com



Supermarket pubs: Bar hopping meets grocery shopping
- Philly.com

By Diane Mastrull

Inquirer Staff Writer

No karaoke nights are offered, and no happy hours. Pour-your-heart-out talks with the barkeep? None of those either.

"We don't ever really get any personal stuff, other than 'I'm going to change my grocery list,' " said Heather Reilly.

And though her job involves mixing cocktails and serving up brews, don't call her a bartender. Reilly's a "service team member."

At The Pub inside the Wegmans supermarket in Collegeville, a social experiment of sorts is in progress, at the point where one of life's most mundane chores intersects with something that could go a long way toward blunting its misery: alcohol.

There's even a chance at romance. So far, the store reports one engagement - which the happy couple toasted with champagne.

The Pub, the only one in the Wegmans chain of 75 stores in five states, opened when the market it sits in debuted Oct. 11 just off U.S. Route 422, in the massive but still largely unoccupied Providence Town Center.

A second Wegmans Pub is planned at a store scheduled to open in June in O'Neill Properties Group's Uptown Worthington, a planned mixed-use complex of homes, offices, and stores along Route 202 in Malvern.

If three stores make a trend, this region is well on its way. Front and center in the Whole Foods Market in Plymouth Meeting that opened Jan. 12 is the Cold Point Pub, a mini-model of the Wegmans watering hole.

At Cold Point, you serve yourself wine from preset taps after paying for an access card. Employees run the beer taps. If the munchies on the menu - such as a charcuterie plate, an olive sampler, and soft pretzels - don't satisfy your appetite, you're free to buy something in the store and bring it into the 30-seat pub.

With its soft lighting and easy chairs, the Whole Foods establishment looks more like a coffee lounge than Wegmans' 63-seat pub, where the bar top is Cambria natural quartz stone, surrounded by solid cherry and cherry veneers. Two flat-screen TVs offer patrons something to watch when they're not gazing into each other's eyes.

The food-service component has enabled Wegmans and Whole Foods to buy restaurant liquor licenses that allow them not only to dispense beer, wine, and - in Wegmans' case - spirits for consumption on the premises, but also to sell six-packs of beer for carryout.

Two per customer is the rule, said Nick Hays, spokesman for the Pennsylvania Liquor Control Board. Otherwise, state law generally limits six-pack sales to bars.

Cases (the equivalent of four six-packs) are the minimum at distributors. Sen. John C. Rafferty Jr. (R., Montgomery) is pushing for an overhaul of the state's beer laws to allow distributors, supermarkets, convenience stores, and bars and taverns to sell anything from a six-pack up to a case of beer.

There are no plans for pubs at the Wegmans stores in Cherry Hill and Mount Laurel - the law in New Jersey does not permit supermarkets to own restaurant liquor licenses.

The Mount Laurel store does have an agreement to sublease space to an independent operator that will sell wine, beer, and liquor, said spokeswoman Jeanne Colleluori.

For now, the company is learning from its Collegeville pub - and making adjustments as customers dictate or events warrant, said Kathy Haines, Wegmans' regional restaurant manager for Pennsylvania.

She said The Pub was intended to fill a gap in the store's Market Cafe complex, where shoppers can buy prepared foods either to take out or to eat at nearby tables. The Pub is a full-service restaurant "where you can enjoy a great meal and enjoy a drink with that meal," Haines said - though, she insisted, "our focus is really on the food."

That seems to go for the customers as well. Monthly Pub sales show just 20 percent of patrons ordering a beer, a glass of wine, or a cocktail with their food order, Haines said. This despite moderate prices: Domestic 12-ounce beers go for $3.75; 15-ounce drafts range from $3 to $4. Wine is $5 a glass. Cocktails - $5.25 to $10. And no tipping allowed! (You don't tip the guy at the deli counter for the pound of bologna he slices you, Haines said.)

Overall, the Collegeville Wegmans store registers 30,000 transactions a week, Haines said. That the bar tab isn't more significant might have a lot to do with the abundance of mothers pushing carts bearing young children, particularly in the daytime, customers suggested.

"I wouldn't want to get drunk in front of families and stuff," said John Riggs, 33, of Pottstown. He opted for a tame ginger ale with his crab cake sandwich on a recent lunch outing to The Pub with three colleagues from Canon in nearby Oaks.

Half-joking, Riggs suggested there is much marketing genius in serving alcohol where groceries are sold: "You come in and have a couple of cocktails, and then you buy all sorts of things you didn't come in for."

That lack of self-control is what Norma Hahn, 76, was trying to avoid.

"I have to cook dinner and help with homework tonight," said the Pittsburgh grandmother, in town with husband Adam, 75, to babysit four grandchildren. While the kids were at school, grandma and grandpa headed to Wegmans to do some grocery shopping - and then some.

She was having an iced green tea with her fried oyster sandwich. He was having a Heineken with his, rejoicing in the idea of a pub in a grocery store, and hoping the idea would soon reach his Giant Eagle store back home.

"My God," Adam Hahn said after taking another swig of beer. "Pennsylvania is finally coming into the new century."

Where does all this store-hours-only imbibing, just a short shopping-cart glide away from the produce and dairy cases, leave traditional pubs?

Confident of not losing customers, said Vincent Giancaterino, co-owner of DaVinci's Pub in Collegeville, just two miles from Wegmans.

Though the Wegmans pub is "nicely done," Giancaterino said, "it's more like a resting place. We have live music five days a week."

US 'problem' banks soar, lending drops

US 'problem' banks soar, lending drops

WASHINGTON - U.S. "problem" banks climbed to the highest level in 17 years, signaling failures may accelerate in 2010, the Federal Deposit Insurance Corp. said.


Meanwhile, bank lending had the biggest retreat in more than six decades even as the industry eked out a small profit, the regulator said Tuesday in a quarterly report.

The FDIC included 702 banks with $402.8 billion in assets on the confidential list of problem banks as of Dec. 31. "Problem" or "troubled" banks now account for 8.7 percent of all U.S. lenders, the highest number since the height of the savings-and-loan crisis in the early 1990s.

Big banks have been gradually recovering, many of them with help from federal bailout money. But distress for small and mid-sized institutions has continued and likely will persist in coming years.

Regional banks are especially vulnerable to losses on loans for commercial real estate, like stores and office complexes. These loans make up a disproportionate share of their business. Losses are growing as buildings sit vacant and builders default on their loans.

Such defaults could escalate the wave of failures that totaled 140 last year. So far this year, 20 banks have failed. By comparison, a total of 28 banks failed in 2007 and 2008 combined.

"The growth in the number and assets of institutions on the problem list points to a likely rise in the number of failures," FDIC chairman Sheila Bair said at a news conference. "Both the problem list and bank failures tend to lag behind economic recovery."

Regulators are closing banks at the fastest pace since 1992, amid loan losses stemming from the collapse of the home and commercial mortgage market. "The pace is going to pick up this year and is going to exceed where we were last year," Bair told reporters.

Banks showed "incremental" improvement in the fourth quarter, Bair said. Overall profit was $914 million, compared with a $38 billion loss in the year-earlier period. Net charge-offs on bad loans slowed for a third consecutive quarter, the agency said.

Meanwhile, idustry lending fell as banks seek to climb out of the worst financial crisis since the Great Depression. Loans fell 7.5 percent in 2009, the largest annual decline since 1942.

Bank failures pushed the FDIC's deposit insurance fund into the red last year. It was $20.9 billion in deficit as of Dec. 31, the agency reported. It expects further bank failures to cost the fund around $100 billion through 2013.

The agency required that member banks prepay about $45 billion in premiums last year, for 2010 through 2012, to help replenish the insurance fund.

Woman pleads guilty to poisoning salsa at restaurant - Kansas City.com


Woman pleads guilty to poisoning salsa at restaurant - Kansas City.com


Yini De La Torre, 19, of Shawnee has pleaded guilty to charges that she poisoned the salsa at Mi Ranchito in Lenexa, where she worked as a waitress, the U.S. Attorney for Kansas reports. De La Torre's husband is still set to stand trial for the alleged plot, which was intended as revenge against the restaurant owner, prosecutors allege. From the release:

In her plea, De La Torre said her husband and co-defendant Arnoldo Bazan worked for a Mi Ranchito restaurant in Olathe until June 27, 2009. Bazan believed the owner of the Mi Ranchito chain was responsible for Bazan being suspended from employment and the theft of Bazan’s vehicle. Bazan hatched a plot with De La Torre to get even with the owner of the restaurant by poisoning the patrons of Mi Ranchito.

During July 2009, the owner of the Mi Ranchito restaurant reported to the Overland Park Police Department that Bazan was stalking him. On Aug. 7, 2009, a message was sent to the restaurant’s Web site threatening harm! if Bazan’s vehicle were not returned. On Aug. 28, 2009, before the second poisoning incident, Bazan sent word to the owner of the restaurant through a family member that “the worst is yet to come."

Fairtrade sales rise by 12% - Wales Online

Fairtrade sales rise by 12% - Wales Online


ETHICAL consumers are becoming increasingly loyal to Fairtrade products, according to new figures released today which show a 12% rise in sales and an estimated retail value of £800m.

Although households struggling through the recession have tended to seek out value brands in cheaper stores such as Aldi and Lidl in recent months, the Fairtrade Foundation said it had bucked the trend and consumers had remained “staunchly loyal” to its popular products throughout 2009.

Meanwhile, organic food sales fell by up to 31% last year as consumers switched to value brands.

Demand for organic bread dropped by 31% compared with 2008, while sales of organic fruit sank by 16.5%, according to figures from market research firm TNS Worldpanel.

The Fairtrade Foundation said the global economic downturn had meant a “desperate” year for producers in the developing countries producing its most popular products, including chocolate, cocoa, coffee, tea, bananas, dried fruit and nuts, honey, beer, wine and spirits.

Chief executive Harriet Lamb said: “2009 was a tough year for everyone but a desperate year for many poor communities and small farmers in developing countries.

“For millions of growers and their families and communities, Fairtrade was able to make the difference that has helped them survive a difficult year and plan for the future.

“It is to the credit of the public that they do care and, despite the recession, they are still voting with their wallets for fairness, and want to change the indignities of an unjust trading system.

“These challenging times have been a wake-up call and forward-thinking companies have also been re-evaluating their priorities, seeing sustainability as the way forward for business, building relations with producers and introducing many Fairtrade products in the past year.”

Rhys Evans, deputy senior director of Consumer Focus Wales, said Welsh consumers understood and looked out for the Fairtrade logo as a conscious buying decision and appreciated its competitive pricing.

Companies now on board with the principle include Cadbury’s Dairy Milk and Nestlé’s Kit Kat. Nerys Howell of Howel Food Consultancy of Cardiff said the recession had prompted consumers to become more cautious in their spending habits across the board.

“In terms of purchasing food, this has meant consumers are looking for added value but not necessarily the cheapest,” she said. “Recent research shows that consumers are looking at issues such as trust, reliability, reassurance and guarantees.

“It is therefore not surprising that sales of Fairtrade products have increased over the last year, whereas the organic market has changed over the past 18 months and faces challenges other than food quality, such as raising the awareness of the benefits of organic production and how they fit with interests in animal welfare and local food.

“The organic sector has a core market of consumers which, although remaining loyal, are spending less on their weekly shop.

“However, the main issue remains that consumers do not fully understand the key messages surrounding organic production and its effect on the environment, whereas the Fairtrade message is simpler to understand with consumers supporting a fair and just trading system.”

The Fairtrade Foundation is asking consumers to switch everyday shopping basket items for Fairtrade items during Fairtrade Fortnight, which began yesterday.

A YouGov poll of UK consumers found 71% were willing to swap one or more products to mark the event.

Sue Fowler, director of Organic Centre Wales, said: “It shows that when people are given a clear message about ethical trading and they see that there is something they can do to help, they will make that commitment for a fairer world.

“We’re working hard to see that organic food is recognised in a similar way for its benefits to the environment and animal welfare in particular, though unfortunately it is a more complicated message to convey. And, of course, if you can buy produce that is organic and fairtrade at the same time, there is an even greater benefit.”

More than 4,500 products are now licensed to carry the Fairtrade mark.

Consumers feeling less upbeat on recovery - Miami Herald

Consumers feeling less upbeat on recovery - Miami Herald
A key economic measurement -- consumer confidence -- fell sharply in February because of concerns over jobs.

NEW YORK -- (AP) -- Americans' outlook on the economy went into relapse in February. Rising job worries sent a key barometer of confidence to its lowest point in 10 months, raising concerns about the U.S. economic recovery.

The Conference Board said Tuesday its Consumer Confidence Index fell almost 11 points to 46 in February, down from a revised 56.5 in January. Analysts were expecting only a slight decrease to 55. It was the lowest level since the index recorded a 40.8 reading in April 2009.

Using a different scale, a University of Florida survey found that Florida's consumer confidence fell in February by two points to 72, reflecting concerns about unemployment, which is higher statewide than across the nation.

``While national unemployment edged downward in January to 9.7 percent, Florida's unemployment increased to 11.8 percent,'' said Chris McCarty, survey director of UF's Bureau of Economic and Business Research.

``This month Floridians may be coming to terms with the possibility that Florida's economy will not recover at the same pace as other states.''

The two-point decline in the overall index comes on the heels of a five-point increase in January to 74. ``January's index seemed more optimistic than it should have been given the economic climate in Florida,'' McCarty said. ``It's worth noting that January's higher index value was based on data collected prior to the release of unemployment figures for Florida.''

The national Consumer Confidence numbers are a reflection that the nation as a whole may be feeling increasingly pessimistic. They erased three months of improvement and are a big blow to hopes that consumer spending will power an economic recovery. Consumer spending accounts for about 70 percent of U.S. economic activity.

The February reading is a long way from what's considered healthy: A reading above 90 means the economy is on solid footing. Above 100 signals strong growth.

While economists said that heavy snowstorms in many areas of the country that shut down businesses dampened confidence, many believe that the report confirms that consumers aren't feeling the nascent economic recovery.

``More than six months after the recovery started, consumer confidence is still close to a record low,'' said Paul Ashworth, senior U.S. economist at Capital Economics.

The news sent stocks lower, overshadowing retailers' reports that showed stronger holiday profits and a housing report, also released Tuesday, that showed that home prices rose for a seventh straight month in December, a sign of price stability as the U.S. housing market continues its bumpy recovery.

However, the Standard & Poor's/Case-Shiller home price index also showed that five of the 20 index cities, including Miami, New York and Chicago, showed price declines from November to December.

Nationwide, the index rose 0.3 percent from November to December, to a seasonally adjusted reading of 145.87. The index was off 3.1 percent from December last year, nearly matching analysts' estimates that it would fall by 3.2 percent.

Illinois stuck in a ‘historic, epic’ budget crisis - Chicago Tribune

Illinois stuck in a ‘historic, epic’ budget crisis - Chicago Tribune
Talk of major tax increases coupled with draconian spending cuts is building in Springfield



Illinois government is staring down the barrel of an explosive financial mess, and perhaps nothing frames the danger better than two big numbers.

The first is $26 billion, the grand total that lawmakers have allotted this year for the meat of what the state does: funding education, health care, child welfare, public safety and the machinery of government itself.

The second number is $13 billion, the total of red ink in the state's main checking account that, by law, has to be erased — at least on paper — before a penny can be set aside for day-to-day operations in the fiscal year, which begins July 1.

In short, the deficit is half as big as the core of the state budget.

To experts, that is an astoundingly scary ratio that ranks Illinois as one of the nation's worst fiscal basket cases — if not the worst. The budget deficit in Illinois is almost as big as the one facing California, a financially beleaguered state that has triple Illinois' population, according to the Center on Budget and Policy Priorities, a liberal Washington-based think tank.

"This is historic, it is epic," said Laurence Msall, president of the watchdog Civic Federation. "It is impossible to overstate the level of peril."

Signs of distress are bleeding out to schools, transit agencies and social service providers, all of which complain that it is getting hard to make ends meet because the state is chronically late with promised cash. Meanwhile, the state's credit ratings are tanking, making it ever more expensive to borrow to make ends meet.

Any resolution will almost surely require sacrifice from taxpayers and state workers as well as political courage from elected officials, a commodity always in short supply but especially so in an election year.

Talk of major tax increases coupled with draconian spending cuts is building in Springfield. Despite the seeming urgency, it is not clear whether it will come to anything more than just talk.

This time last year, the budget outlook was already plenty bleak, yet Gov. Pat Quinn and lawmakers ultimately avoided tough fixes. Delay only added billions of dollars more to the projected deficit.

Illinois is hardly the only state reeling from the recession. But a long and bipartisan history of wishing financial problems away has rendered state government here particularly vulnerable.

Budget pressures began to mount in Illinois long before the economic downturn. But the fashionable response from political leaders was to avoid talk of tax increases or significant spending cuts and instead vow elimination of "waste, fraud and abuse," as if those items appeared in a line in the budget that could simply be cut out.

Now, the state's fiscal woes have grown so deep that solid solutions defy such glib answers.

Consider this: The head count of state workers is 20 percent smaller than it was a decade ago. If the state payroll was magically purged of every single employee, the annual salary savings would amount to $4 billion, less than one-third of what is needed right now to dig out of the deficit hole.

"Any elected official or candidate who says you can solve this without a tax increase is either incredibly math-impaired or intentionally deceiving voters," said Ralph Martire, executive director of the Center for Tax and Budget Accountability, another Illinois budget watchdog.

Last year, federal stimulus spending and a heavy dose of borrowing helped state officials skate around tough budget choices. But now the stimulus money is about to dry up, and the loans must be repaid.

Adding to the challenge is a steep decline in sales and income tax revenue, off nearly $1 billion from what was projected last summer.

The total budget for the current year stands near $55 billion, but about half of that is dedicated for items like road and building programs or earmarked federal funds that lawmakers have little leeway to divert or chop.

The only significant wiggle room resides in the other half of the budget, known as the general funds, which are tapped to pay for most common government operations. And whatever flex there is in the general funds, there's certainly not close to $13 billion worth — an amount equal to what is being spent this year on the State Board of Education as well as the departments of Human Services, Children and Family Services and Public Health combined.

More than $7 billion of the $26 billion in general funds appropriations this year is earmarked for elementary and secondary schools. Any cuts would only increase pressure on local property taxes, which already bear the brunt of public school funding and, as taxes go, are probably more unpopular than the income or sales tax.

Another $8 billion was earmarked for public health care programs including Medicaid, the safety net for the poor that is often a target of criticism from the right. Federal stimulus aid that Illinois is now getting to help stave off financial disaster comes with strings that forbid any rollback in benefits to Medicaid recipients.

Without a tax hike, the Civic Federation estimates, just four key spending items — schools, Medicaid, deficit reduction and debt service on loans the state must repay — will eat through 80 percent of the cash available to pay for all general state programs.

Experts have long warned that the financial reckoning in Illinois was coming, pointing to what they call an inherent "structural deficit" in the state budget. That's a fancy way of saying that revenues collected by the state through taxes, fees and other sources were clearly insufficient in the long run to pay for all the programs and benefits that state officials had put into place.

Rather than confront the imbalance head-on, standard practice in Springfield has been to resort to a combination of fiscal tricks. Revenue projections are unrealistically rosy, money is borrowed with full repayment pushed off years into the future, and multibillion-dollar backlogs of unpaid bills are allowed to fester.

The system was already primed for calamity when the steep recession that began in 2008 knocked it over the edge.

Perhaps the most chronic headache involves pensions. For decades, elected officials have shorted promised contributions to the state's public employee retirement funds. As a result, Illinois by far has the worst-funded pension systems in the nation.

It would be a tall order for the state to totally dig its way out of the hole in one year's budget. But playing catch-up is extremely expensive, and it grows more expensive the longer it takes. Because the state was so short of cash, it borrowed $3.5 billion to meet this year's pension obligations. Next year, debt service on that loan will cost $800 million. And that's in addition to more than $4 billion in pension obligations that the state will be on the hook for in fiscal 2011.

As Msall sees it, Illinois is in such poor financial shape that it risks getting to the point where it can no longer make loan payments or meet state aid commitments to schools.

If that happens, he says, "Illinois' ability to borrow will be eliminated and the state will come to a screeching halt."

bsecter@tribune.com

Why an All-'Superfoods' Diet Is a Mistake - US News

Why an All-'Superfoods' Diet Is a Mistake - US News

We've all seen those lists of "superfoods"—certain fruits, nuts, and other foods that, advocates say, have health-boosting effects. But some people take those lists so seriously that they limit their food choices to what's on them. "They'll say, 'Every day I have Kashi with blueberries and almonds for breakfast, salmon on leafy greens with broccoli for lunch, and grilled chicken with sweet potato for dinner,'" says Mary Beth Augustine, a registered dietitian and senior integrative nutritionist for Beth Israel Continuum Center for Health and Healing in New York. The more educated they are and the more reading about health they've done, the more likely they are to strictly adhere to what they think is a perfect lineup of foods, she says.
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[Slide show: Check out some alternatives to 8 superfoods.]

While that one-day menu is certainly healthful, getting into a rigid dietary routine isn't ideal, dieticians and nutrition scientists say. Many fruits and vegetables are chock full of nutrients. There are vitamins, minerals, and fiber, of course, but plants also have a host of special compounds they evolved to defend themselves from, for example, the sun's radiation, says Navindra Seeram, an assistant professor at the Bioactive Botanical Research Laboratory at the University of Rhode Island who studies the properties of berries. Those phytochemicals aren't essential for our own life and energy, but "research has shown that they may impart biological effects," says Seeram. (They're mostly studied for their beneficial effects, but some can have detrimental ones that we need to be aware of, such as grapefruit's interaction with some drugs.)

Certainly some foods have unique properties, says Seeram. Cranberry juice, for example, can protect against urinary tract infections. But researchers have identified only some of the thousands of active ingredients in fruits and vegetables (as well as other foods) and haven't begun to piece together all the ways they work together. There are some hints, however, that they do interrelate to have an impact on health. A study published in 2006 in the Journal of Nutrition compared two diets. Both provided eight to 10 servings of fruits and vegetables per day. But one diet included foods from 18 different botanical families; the other covered only five families. The researchers concluded that only the diverse diet "induced a significant reduction in DNA oxidation." (DNA oxidation, or oxidative damage, occurs when molecules called free radicals wreak havoc in the body. Antioxidants like some of the vitamins and phytochemicals found in plants are believed to reduce this damage.) In other words, as the researchers wrote, "smaller amounts of many phytochemicals may have greater beneficial effects than larger amounts of fewer phytochemicals."

Dawn Jackson Blatner, a Chicago-based dietitian and author of The Flexitarian Diet, agrees. "No one food is the superhighway to optimal health," she says. "The real magic happens when foods synergize and you get this great variety." Not only does variety give you wider exposure to the good stuff, it gives you less exposure to any detrimental phytochemicals or substances, such as the toxins in some mushrooms, says Augustine. To maximize the variety of fruits and veggies you get, dieticians advise people to "eat the rainbow," aiming to consume a variety of foods within each color group: red (including watermelon and tomatoes), red-purple (berries such as blueberries and blackberries, eggplant), orange (carrots and pumpkin), orange-yellow (citrus fruits, papaya), yellow-green (avocado and spinach), green (broccoli and cabbage), and white-green (garlic, onion, pears). (These categories are from UCLA scientist David Heber's What Color is Your Diet?)

"It's the same thing I teach kindergartners and preschoolers," Augustine says. The principle holds with nonplant foods, too. Eating a lot of the same kind of fish may expose you to possible contaminants, like mercury or PCBs, and deny you the benefits of many different species. At some point, says Seeram, science may be able to pinpoint ideal food pairings based on how their nutrients interact, but for now, the key is to simply aim for at least five servings of fruits and vegetables per day, across the color spectrum. Variety (within the confines of healthful foods, at least; being sure to take in Twinkies, Ho Hos, and Ding Dongs during a given week doesn't count) as a guiding force for eating? It doesn't boil down to an easy list, but yes, it can be that easy.

Monday, February 22, 2010

Don Curlee: Study evaluates local agricultural production - Visalia Times


Don Curlee: Study evaluates local agricultural production - Visalia Times



Producing food near population centers is the dream of locavores, but now it's also the subject of a serious study by a Ph.D. agricultural resources student at the University of California, Berkeley.

The study concludes that the benefits of such a massive shift in such production and distribution methods are not likely to be as substantial as has been asserted. Furthermore, it suggests that the benefits are dwarfed by the costs of less-efficient production and reduced access to nutritious food.

The perspective taken by study author Steve Sexton is global. He cites projections of a world population of 9 billion by 2050, and says feeding a hungry world is a paramount objective. He summarized his findings in the November/December issue of Update, published by the Giannini Foundation of Agricultural Economics at the University of California, Davis.

"A doubling of food production in the second half of the 20th century saved the world from mass starvation," he writes, "as population doubled to six billion." He credits the rise of modern farming propelled by the Green Revolution for that accomplishment.

While current food production and distribution systems are criticized by locavores for their consumption of energy, Sexton says such criticism ignores the economies of scale and the gains of moving from a mule-dominated farm economy to the efficiency of tractors and other motorized equipment. He believes those advantages likely will be lost in smaller diversified farm units nestled against the city limits.

The fantasy land Sexton identifies as pseudo-locavorism will require more than 214 million additional acres in farm production, an area twice the size of California. The transition means 40 million additional acres will be required in California, 34 million in Texas and 26 million in Florida.

The additional acreage and loss of efficiencies are calculated by Sexton to demand significant energy-intensive inputs that will likely overwhelm any carbon-emissions reductions coming from decreased transportation and monocropping.

School lunch programs healthier, take smaller bite of revenues - Colorado Independent Mail

School lunch programs healthier, take smaller bite of revenues - Colorado Independent Mail


It’s 11:50 a.m. when more than 250 students start to filter into Palmetto Middle School’s cafeteria.

On the serving line in the Williamston-based Anderson School District 1 school are pizza, nachos and Mexican pizza made with burritos, taco meat and cheese.

First, the students pass a salad bar, cups of fresh fruit, raw vegetables and whole-grain rolls.

And they’re eating it. Trays go by with cups of grapes, mounds of pickles, veggies and dip, alongside pizza with low-fat brownies and skim milk.

As school budgets feel the crunch from the economy, school food service programs are taking a smaller bite out of school revenues.

But it’s a healthier bite too.

Officials say the increase in the number of children in the free and reduced-price lunch program actually helps school district decrease the amount of money allocated to the food service programs.

“It’s the economy,” said Sandra Jordan, director of food services for Anderson School District 5. “The more students we have on the free and reduced lunch program, the more money we get from the federal government.”

In District 5, the number of students getting free and reduced-price lunches has risen in the last year from 45 percent when Jordan started in 1984 to 55 percent this year.

The increase in the number of students in the program means the district can offer universal free breakfast for students at McCants,. Lakeside and Southwood middle schools, Calhoun Academy of the Arts, Homeland Park Elementary School and Nevitt Forest Community School of Innovation.

Jordan, a registered dietitian, said the breakfast helps the students and the teachers during their academic day.

“Providing kids with breakfast puts them all on a level playing field,” she said. “When you’ve got a student eating breakfast at 6 a.m., and starting school at 8, their blood sugar level is going to be different than a teacher who may eat at 7 before going to work. By providing breakfasts, it levels out the playing field for all of them.”

Jordan said the district also participates in the South Carolina Food Service Alliance, which allows her to reduce her costs by buying foods with other districts at bulk prices.

“We’re supposed to break even, but we may cost a little bit more when we have to make bigger purchases,” Jordan said. “An oven for us can cost $23,000. If one of them breaks down, we have to replace it.”

In Anderson School District 1, the food service program actually makes money for the district.

“The most important thing we do is keep labor costs down,” said David Havird, associate superintendent. “We try to maintain a ratio of 18 meals per man hour.”

The food service program generates an excess of $200,000 to $250,000 per year. That money, said Debra Joye, director of student nutrition, is put back into the program to pay for the costs of utilities, equipment and upgrades in technology. All food service money is kept in a separate account, and none of its revenue comes from the district’s general fund.

“This way the money doesn’t have to come out of the general fund and can go to instruction and the classrooms instead,” Havird said.

In fact, the lunches are so good that Palmetto Middle lunchroom manager Kim Floyd often fills to-go boxes of food for members of the district’s administrative staff. Lunches for adults cost $3.10.

The more meals that are sold, Havird said, the more money the district makes, because of federal reimbursement.

Joye said using free government commodities as the main element of the lunch allows her to spend more on healthier food, like fresh fruits and vegetables.

And that’s what allows her to make lunches that are healthier than most home meals.

“By federal regulations, our food has to be less than 30 percent fat,” she said. “Children eat with their eyes. So when we designed these lunch lines, we put the fruits and vegetables in the front so they would fill up on them before getting to the meats.”

By making small changes, like substituting whole grains, like whole-wheat bread and brown rice, for processed grains, and using low-, reduced- or no-fat foods, she’s able to offer healthy alternatives that children still eat.

“Every time I go through the line I get salad ‘cause it’s nutritious,” said Briana Murphy, 11, a sixth-grader. “I like the broccoli too. It really tastes good.”

Joye said she uses a youth advisory council to help her select what goes on the menu. Once a month, a group of students from each school gives its ideas on what students would like to see on the menu. Many of those ideas show up for breakfast or lunch, Joye said. And while the foods may sound like they fall on the junk side, a few small changes make them more healthy.

“Like our teriyaki chicken,” Joye said. “It’s chicken pieces (boneless and skinless) in teriyaki sauce served over brown rice.”

Palmetto Middle Principal Barry Knight said including the children’s ideas increases the amount of meals that are sold.

“If we don’t listen to our customers, we’re not doing our jobs,” Knight said. “And this gives them a bit more ownership.”

For District 5’s Jordan, the idea that school lunches aren’t nutritious is outdated.

“When I hear people talking about junk in cafeterias, I think they really haven’t been paying attention to what’s being served in a cafeteria,” she said. “We don’t add salt to anything unless we’re cooking. Our food is low salt, low sugar and low fat. And we’ve been that way for 10 years.”

Every little helps? Supermarkets accused of 'cynical manipulation' over 1p cuts

Every little helps? Supermarkets accused of 'cynical manipulation' over 1p cuts

Former OFT head criticises industry as investigation shows majority of trumpeted price reductions worth just a penny


The majority of price cuts in the supermarket price wars between Asda and Tesco in the run-up to Christmas were just 1p, a Guardian investigation can reveal. In contrast, the majority of price increases imposed by the two retail giants during the same period were more than 10p.

This new analysis of supermarket pricing policy shows a "cynical manipulation of the language of value" according to independent expert Professor John Bridgeman, who criticised the use of "price flexing".

Bridgeman, who as director general of the Office of Fair Trading from 1995 to 2000 conducted official inquiries into the supermarket sector, said the large number of 1p decreases, promoted by Tesco and Asda as thousands of price cuts before the festive season, damaged the credibility of any marketing slogans they used.

"They are not in reality cutting prices but flexing prices, making them go up and down and destabilising the price structure," Bridgeman said. "All they are doing is introducing so much volatility no one can tell whether prices are going up or down. It can only be to consumers' detriment and it does their image no good."

Data taken from Asda's website by third-party analysts indicates that it cut nearly 800 prices between 16 and 23 December, with two-thirds of the cuts being just 1p and 80% of the total number being less than 10p. It also increased more than 850 prices that week. In contrast, only 6% of the rising prices went up by the same small increment of 1p; 53% of the rises were more than 10p.

The pattern is repeated in data taken from the Tesco website: between 16 and 23 December it cut about 930 prices, 70% of which were by just 1p. It also increased just under 1,000 prices in the same period; in contrast 7% of these rises were by the small increment of 1p, and more than 600 – or 60% – of the price increases were by more than 10p.

Both supermarkets said the majority of price increases in that period can be explained by products which had been discounted coming off promotion.

In Bridgeman's view, the scale of price changing and the relative size of the cuts and rises is both confusing and misleading to consumers. "The most dangerous thing [for] competition in this sector is price volatility," he said. "It confuses consumers, deters investors and has driven corner shops out of business because they don't know what price they have to compete on," he said.

Paul Dobson, a professor of retailing at Loughborough University who has been studying supermarket prices over a five-year period, says the pattern the Guardian had identified before Christmas matches the overall pattern. Researchers at Loughborough and at Warwick University have found that, overall, price cuts made by the big four UK supermarkets – Tesco, Asda, Sainsbury's and Morrisons – tend to be small and price rises larger.

His research has found the most common price cut among the big four over five years is 1p. Such low cuts have little impact at the checkout, but introducing them on large numbers of goods enables the supermarkets to claim they are cutting thousands of prices. Over the five years, according to Dobson, these small cuts have been used to mask serious price hikes on a smaller number of lines with a big net effect on bills. "In the big inflationary period of 2008, there were two and a half times the numbers of price cuts in the big four as price rises, but in fact prices overall were rising very rapidly," he said.

Dobson said his research shows that of the big four UK supermarkets, Tesco is the most prolific user of 1p cuts, and Asda the second most prolific. He also said Tesco changes its prices more than the other retailers.

Asda did not challenge the Guardian figures but said the explanation for the large number of 1p cuts was "straightforward". "We won't be beaten on price. So if a competitor goes lower than us on a comparable product, even by just a penny, we will always try and match or beat that price," said a spokesman. "Whichever way you look at the numbers, Asda is the undisputed lowest price supermarket – as independently verified by mysupermarket.com."

Tesco also rejected Bridgeman's interpretation of the significance of the number of small and large price changes:

In a statement, the company said: "We do not manipulate prices in this cynical way. The Guardian and Professor Bridgeman are using data we do not recognise and his conclusion that we are deliberately confusing customers is nonsense.

"This is a competitive market and prices are lower this year than last year. Our customers know us, shop with us every week, trust us and are not confused. Instead of trying to find product price changes to fit a half-baked theory, Bridgeman and the Guardian should look at what has happened to the overall price of customers' baskets. As the current head of the Office of Fair Trading said last month, the sector is 'highly competitive' and prices have 'come down enormously'."
Coming clean
A discount that 'disguised a rise'

The rise and fall in price of a leading brand of cleaner, CiF Antibacterial, provides a "perfect example of price volatility designed to confuse consumers", according to Professor John Bridgeman.

In June last year the CiF cleaner was being sold at £2.50 in both Asda and Tesco. In August it went on promotion briefly at Asda at £1 before returning to £2.60. Tesco dropped the price to £2 in September before putting it back up to £2.50, and then discounting it again in November to half price at £1.25. By December Asda had put it up to £2.80 and higher, and the week before Christmas Tesco increased the price to £2.80. By the end of the year, both retailers had increased the price by what Bridgeman calls an "aggressive" 12% over the price at the beginning at the summer. Discounts have disguised a rise, he says.

Tesco rejected Professor Bridgeman's interpretation of the significance of the number of small and large price changes:

"We do not manipulate prices in this cynical way. The Guardian and Professor Bridgeman are using data we do not recognise and his conclusion that we are deliberately confusing customers is nonsense."

Asda did not challenge the Guardian figures but said the explanation for the large number of 1p cuts was "straightforward". "We won't be beaten on price. So if a competitor goes lower than us on a comparable product, even by just a penny, we will always try and match or beat that price."

Dining out: It's a whole new game LA Times


Dining out: It's a whole new game LA Times


Going to a restaurant these days includes calorie-counting and trans-fat measuring before you order. How much is that hoagie in the window?



You can dig into that dulce de leche cheesecake, but you can no longer hide. With a California law now mandating that chain restaurants provide customers with nutrition information, consumers are coming face to face with the calorie, fat and sodium content of their favorite restaurant dishes — numbers they've only been able to guess at before.

That dulce de leche delight from the Cheesecake Factory? 1,010 calories per slice. A surely more prudent fajita fiesta pollo salad at Red Robin? A cool 1,000 calories with 62 grams of total fat and 1,408 milligrams of sodium — almost the recommended day's worth of salt for a middle-aged person.

We went to restaurants to see what the new law is revealing about the food (and, yes, of course, so that we could shriek at the numbers). And we did some digging to see what this new age of restaurant-transparency may mean. The numbers are eye-opening, for sure: Who would imagine a big slice of pie in many cases could do less calorie damage than a salad — a virtuous salad? But it's still an open question how we will respond to the nutrition news — as our interviews with diners and a survey of the science revealed.


Americans are eating out more and more: According to the National Restaurant Assn., 49% of every food dollar in the U.S. is now spent in restaurants, up from 25% in 1955.

What that means is we have less and less control over just what goes into our food — and the numbers, now available per California law, are sometimes shocking. Even healthful-seeming selections can pack a calorie-, fat-, salt- or sugar-laden punch.

Salads, long touted as a virtuous choice, are a prime example. At IHOP, the grilled chicken Caesar salad has 1,210 calories, far more than the patty melt, which comes in at 750 calories. At Baja Fresh, a chicken tostada has 1,140 calories and 14 grams of saturated fat.

If you figure that the average person needs 2,000 calories a day, it's sobering to learn that more than half that amount can easily be consumed in a restaurant breakfast alone. And don't forget sodium. The recommended daily limit is 2,400 milligrams a day (1,500 milligrams for those who are middle-aged, are in certain ethnic groups or have conditions such as high blood pressure). Many restaurant dishes contain more than you should have in a whole day.

Some chain restaurants have begun to create lower-calorie items or are highlighting their existing more-healthful items. Restaurant executives stress that this has been prompted by customer preferences and shifting dining trends, not by existing or pending menu labeling legislation. (Some nutrition experts suspect that new laws and the possible federal mandates waiting in the wings are more influential than companies want to admit.)

The Corner Bakery Cafe recently listed 100-plus combinations of menu items that come in at less than 600 calories, such as an Asian wonton salad and cheddar broccoli soup, or a tuna salad sandwich and Caesar salad.

Applebee's has its new "Under 550 Calories" menu, offering grilled shrimp and island rice, asiago peppercorn steak, and grilled dijon chicken and portobellos.

Starbucks lately began touting its "skinny" drinks, which are less than 100 calories, such as the skinny vanilla latte and the skinny cinnamon dolce latte, plus its new under-400-calorie hot panini sandwiches.

Cheesecake Factory has a few "weight management" dishes that are lower in fat and calories, and the company recently introduced a small plates and snacks menu, with smaller-portioned items such as mini corn dogs, shrimp scampi crostini, arugula salad and crispy fried cheese — not all of those, however, are low in calories.

Romano's Macaroni Grill chain was dinged by the consumer advocacy group Center for Science in the Public Interest years ago for its heavy sauces and fatty, meat-centric entrees, but since Chief Executive Brad Blum came on board in 2008, the chain has cleaned up its act.

Yes, the Alfredo is still there (the sauce alone is 610 calories and 31 grams of saturated fat), but so is a honey balsamic chicken at 540 calories and 3 grams of saturated fat (side dishes included) and a scallop and spinach salad at 360 calories and 4 grams of saturated fat that includes the dressing, and pollo caprese pasta at 550 calories and 5 grams of saturated fat. Some favorite dishes have slimmed down: eggplant parmigiana went from 1,270 calories to 800.

It's not clear what people are doing so far with the information or how that might change when calories and fat grams appear right in your face on the menus in 2011, when the second part of the California law takes effect. Many people, like Elizabeth Rubien, dining on a recent day at Coco's in Culver City, aren't very interested.

"I'm not going to study nutritional information when I go into a restaurant," she said, "and I already know pretty well what's healthy. I don't care how many grams of fat are in something. Grams of fat are not my life."

Kelly Brownell, director of the Rudd Center for Food Policy and Obesity at Yale University, says the same attitude prevailed when food manufacturers put nutrition information on grocery store items, and yet shopping patterns did change with time.

"But the bigger benefit probably will be that restaurants will offer lower-calorie [dishes]," says Michael Jacobson, executive director of the consumer advocacy group Center for Science in the Public Interest. They may also decide to provide meals lower in salt and saturated fat, he says, and trim calories wherever they can from items already on their menus


You'd think, with the ugly truth at last laid out before them courtesy of the new labeling law, California's restaurant diners would alter their behavior. That's a no-brainer, right?

Certainly, health experts hope that clearly displayed nutrition facts will encourage folks to straighten up and order right. But the evidence so far is inconclusive.

It doesn't help that restaurant menu labeling is still fairly new — the first law went into effect in New York City in July 2008 — so the bulk of what's known comes from simulations that may not mirror real-life dining behavior.

Some of what we know:

• A study published in January in the journal Pediatrics reported that mothers made better choices for their children when provided with calorie numbers but didn't make those same decisions for themselves. In the randomized, controlled study, 99 parents of children ages 3 to 6 were given a McDonald's menu and asked to choose what they might order, just as if they were in the restaurant.

Parents who received menus with calorie information ordered an average of 102 fewer calories for their children than a control group not given that information. But there was no calorie difference between the two groups in what parents ordered for themselves.

"Anecdotally I know that people do want what's best for their children," says study author Dr. Pooja Tandon, a pediatric researcher from Seattle Children's Research Institute. So why don't they make better choices for themselves? Tandon isn't sure. "Maybe in other areas of health, like smoking, they may be more inclined to be healthier when they know it's going to affect their children."

• Researchers at Stanford University studied customer habits at some Starbucks locations in New York City from January 2008 to February 2009 (straddling the period when the city's menu labeling laws went into effect). Average calories per transaction decreased by 6% after the change, almost all of it related to food, not beverages. Food calories per transaction decreased 14%.

Of the calorie decrease, 75% came from buying fewer items and 25% from choosing lower-calorie items.

• Posting calories didn't seem to change the habits of fast-food-chain customers in New York City, according to a different study. Published online in October in the journal Health Affairs, it surveyed 1,156 adults eating at fast-food restaurants in low-income, minority New York City neighborhoods. About half of the people noticed the calorie labeling, and of those, almost 30% said the information influenced what they selected. Most said they made more healthful choices because of it.

But when researchers examined receipts, they detected no difference in calories compared with people surveyed in an area of New Jersey where the law didn't apply and nutrition information wasn't available.

• A study published online in December in the American Journal of Public Health found that, though nutrition labeling helps, it may not be enough. In the study, 303 people eating dinner were randomly assigned to choose from a menu that had no calorie information, one that had calories, or one that had calories plus prominently displayed information on the recommended daily calorie intake for an average adult.

Those in the two groups with calorie information ordered 14% fewer calories overall at dinner than those without it. But the group supplied with just the calorie information made up for being careful at dinner — they consumed more calories later in the evening and ended up eating as much as the no-calorie-information group.

Those who got information on daily recommended calorie intake as well, however, ate an average of 250 fewer calories during dinner and after than either of the other two groups.

Adding the daily calorie information was an eleventh-hour decision, says Kelly Brownell, one of the study's authors and director of the Rudd Center for Food Policy and Obesity at Yale University. "It occurred to me that people may not know what calories mean. If a burger is 800 calories, is that a lot or a little? We thought that if we provided some reference points, it might make a huge difference."


Californians have a rep, deserved or not, for being health conscious — asking for dressing on the side and meats that are grilled instead of fried. So are they leaping to devour the nutrition data now available in restaurants? And what surprises does the information hold?

To get a sense, we visited a few local eateries. At the places we went to, information was usually on the table or, if not, brought quickly when asked for — but we spotted very few patrons interested enough to check it out.

Sure, a few diligently study it. Some are only dimly aware of it. And others know about it but don't think they need it.

At a Hollywood Denny's, we found Los Angeles-based graphic designer Anthony Briggs, 58, having dinner with a friend. "I don't take it into account," he said of the nutrition facts sitting on the table with the condiments. He doesn't need to, he added: A heart attack 20 years ago made him aware of the cholesterol and saturated fat in what he eats — he navigates menus with care and leaves plenty on his plate.

He usually orders the same things. Tonight it was barbecued chicken (650 calories and 3 grams of saturated fat before factoring in the side dishes).

Briggs thinks the information should be available. "And I think people should pay attention, but I'm pretty sure they don't."

Where we found the information: on a brochure provided with the menus.

The good, bad and ugly: No one goes to Denny's expecting health food, but there are some decent choices, most under the "Fit Fare" label. The Fit Fare grilled chicken breast sandwich, which comes with fruit, is 450 calories. Cobble together a breakfast of two egg whites, four strips of turkey bacon, fruit and an English muffin with margarine for a reasonable 426 calories. Most of the hamburgers are what you'd expect — 940 calories for a bacon cheddar burger — and chicken strips will run you 560 calories without the sides. Beware the "Rock Star Menu," on which the Los Lonely Boys Texican Burger is 1,020 calories and 19 grams of saturated fat, and the Hooburrito is 1,430 calories and 15 grams of saturated fat.

At an IHOP in L.A.'s Miracle Mile district the next morning, 16-year-old Jasmine Gums of Inglewood was sitting with her mother, Margaret Mallard of L.A. Gums was eating an egg white omelet with spinach; her mother was halfway through her eggs, hash browns and sausage. Both approve of the law — Gums said she was startled when she saw the calorie counts for the first time at a Mimi's Cafe. She knows calories well enough to choose something healthful, she added, but still enjoys perusing the nutritional info.

Mallard says she occasionally peeks at the numbers, noting details such as the saturated fat. But it doesn't influence what she orders: "I'm just in general a bad eater. I knew I was going to have pancakes. My daughter looks at the menu and says, ‘This has too many calories,' But me," she adds, laughing, "I'll just get a Diet Coke to compensate."

Both thought the labeling law was a good idea: "Some people are health conscious," Gums said, "and they like to know what they're eating."

Where we found the information: written on the menu.

The good, bad and ugly: "IHOP for Me" is where you'll find the restaurant's under-600-calorie offerings for adults and kids, such as the blueberry harvest grain-and-nut combo for 570 calories and the tilapia hollandaise for 370 calories. Watch out for the quick two-egg breakfast at 850 to 890 calories (the bigger number indicates higher-calorie side dishes) and the chicken clubhouse super stacker sandwich at 1,080 to 1,490 calories. Beware the super-rich breakfasts, such as the New York cheesecake pancakes at 1,270 calories and the south-of-the-border burrito at 1,450 calories.

At Coco's Restaurant & Bakery in Culver City, friends and fellow retirees Elizabeth Rubien and Celeste Cass were having lunch, a weekly ritual.

Cass sometimes checks out the information passed out with the menus but said that she's generally careful about what she eats and figures she knows what's loaded with butter, salt and sugar and what's not. When she wants to splurge, she does.

Rubien isn't a fan of the law: "I don't think it's going to do that much good," she said. "I think there are very few people who are going to sit and study it. It's just another thing that's going to cost restaurants money, and, like other businesses, they can hardly stay open the way things are."

Where we found the information: on a laminated sheet that's provided when asked for.

The good, bad and ugly: The chain's "Fit and Lively" menu features a tomato, basil and egg-white omelet at 350 calories and a Southwest angus sirloin at 400 calories. On the regular menu, the Southwest chicken salad is 730 calories, and the Samuel Adams beer-battered fish and chips is 1,250 calories. Feel like something sweet? You may not, after finding out that a slice of cream cheese pie with cherry topping is 910 calories.

At a Starbucks on Melrose Avenue, Vince Weir was just polishing off a multi-grain bagel with cream cheese and an iced coffee. The L.A. actor and bartender was vaguely aware of the menu labeling legislation and knew Starbucks provided nutritional information in brochures stacked near the cream and sugar, although he'd never checked them out.

He did think providing the information was a good idea — in brochure form, anyway. On menus? Not so much. "If I'm about to have a steak, I don't want to see that it has 800 calories. No, I don't like that."

Where we found the information: brochures placed near the sugar and cream.

The good, bad and ugly: Starbucks limits calories-per-item to 500, but best bets are items like the spinach, egg white and feta wrap at 280 calories and the blueberry oat bar at 250 calories. Things start to add up when you add a beverage: A venti vanilla latte with 2% milk is 320 calories, and a grande hot chocolate is 300 calories. Breakfast becomes a hefty deal when you start with a blueberry scone at 460 calories or a slice of banana bread at 490 calories.

At the Cheesecake Factory in Sherman Oaks, friends Jackie Wise and Roberto Izarraras were sitting down to dinner. She had just perused the nutritional information, which was bound into a little book and placed on the table along with the menus. And she wasn't too happy about it.

"I was shocked," Wise said. "The calories you can kind of figure, but the sodium was unbelievable. I come here rarely, and it's usually to treat myself, but when I did look at some of the stuff — like the pizzas — if I were inclined to get one, I wouldn't, because of the calories and sodium." On this occasion, she ordered a grilled chicken tostada salad at 1,140 calories and 2,151 milligrams of sodium.

Izarraras' go-to favorite is the crispy chicken Costoletta, at 1,238 calories. Being on a diet steered him to something he hoped was better because it wasn't breaded — the teriyaki chicken. A good move? Maybe not. It had a fraction of the fat of the other dish — but the fact book clocked it in at 1,403 calories. Both diners said they take some part of their meal home with them. With the new info, "I'm more inclined not to go for those dishes every time, perhaps," Izarraras said. "Certainly for the cheesecake, I'd think twice."

Where we found the information: Before you even ask, the waiter plops it down on the table with the menus.

The good, bad and ugly: The Cheesecake Factory isn't known for being kind to diets, but there are a few things that are tolerable. The "Weight Management" dishes are lower in fat and calories than most menu offerings — 598 for grilled chicken. Some lunch dishes aren't bad, such as the grilled salmon at 484 calories. The chain's new "small plates and snacks" menu may have toned-down portions, but calories are still high on items such as onion rings. Most regular entrees are more than 1,000 calories and loaded with salt, and as for the cheesecake — if you have to ask, you can't afford the calories.

In D.C., more evidence that commercial real estate headed for foreclosure crisis - Washington Post

In D.C., more evidence that commercial real estate headed for foreclosure crisis - Washington Post





By V. Dion Haynes
Washington Post Staff Writer
Friday, February 19, 2010; A01

A mortgage crisis like the one that has devastated homeowners is enveloping the nation's office and retail buildings, and few places are likely to be hit as hard as Washington.

The foreclosure wave is likely to swamp many smaller community banks across the country, and many well-known properties, including Washington's Mayflower Hotel and the Boulevard at the Capital Centre in Largo, are at risk, industry analysts say.

The new round of financial pain, which some had anticipated but hoped to avoid, now seems all but certain. "There's been an enormous bubble in commercial real estate, and it has to come down," said Elizabeth Warren, chairman of the Congressional Oversight Panel, the watchdog created by Congress to monitor the financial bailout. "There will be significant bankruptcies among developers and significant failures among community banks."

Unlike the largest banks, such as Citigroup and Wachovia, that got into so much trouble early on, the community banks in general fared better in the residential mortgage crisis. But their turn is coming: Not only did community banks issue a higher proportion of commercial loans, but they also have held on to them rather than sell them to other investors.

Nearly 3,000 community banks -- 40 percent of the banking system -- have a high proportion of commercial real estate loans relative to their capital, said Warren, whose committee issued a report on commercial real estate last week. "Every dollar they lose in commercial real estate is a dollar they can't use for small businesses," she said. Individuals -- who saw their home values drop in the residential mortgage crisis -- would not feel that kind of loss, but, Warren said, a large-scale failure would "throw sand into the gears of economic recovery."

In Washington, the number of troubled properties has multiplied at a phenomenal rate, with the value growing from only $13 million in 2007 to $40 billion now, according to CoStar Group, a Bethesda real estate research company. The region trails only South Florida and metropolitan New York in the per capita value of commercial real estate assets in foreclosure, default or delinquency, according to the research group Real Capital Analytics.

The threat is especially acute in the District, the firm said, where the catalogue of troubled commercial real estate properties has grown tenfold since April. Moreover, the region has $7.3 billion in commercial properties that are underwater -- worth less than the mortgages on them -- according to CoStar.

Whether the commercial real estate bubble bursts in a catastrophic event or subsides slowly and less dangerously will be determined during the next year. An immediate crisis was postponed when domestic and foreign investors began snatching up troubled properties at bargain prices. And banks more and more are renegotiating loans, extending the terms by a year or two in the hope that conditions will improve rather than calling in mortgages that cannot be paid.

In Washington, the office vacancy rate stopped ballooning in the fourth quarter of last year for the first time since the first quarter of 2006, according to CoStar, although largely for an unfortunate reason: The space was being filled mainly by office workers hired to handle the plethora of bankruptcy filings and "workouts" of borrowers who need to renegotiate bad debt.

And last quarter, for the first time since the second quarter of 2008, the Washington area office market saw a strong net gain -- 925,000 square feet of space that had been "absorbed" or leased by new tenants, according to CoStar.

"There's light at the end of the tunnel," said Andrew Florance, chief executive of CoStar. "But in commercial real estate it's a very, very long tunnel and many people will not come out of it."
'Do the math'

Nationwide, at least $1.4 trillion in commercial real estate debt is expected to roll over during the next three years. Warren said that half of commercial real estate mortgages will be underwater by the beginning of 2011. A fifth of residential mortgages are underwater now, she said.

Unlike residential mortgages, which often can be paid over 30 years, commercial real estate mortgages typically must be paid off or refinanced within five years. Commercial properties mortgaged in 2005, 2006 and 2007, at the height of the boom, are reaching their maturity date. "Do the math on this," Warren said. "This is a significant problem."

The Renaissance Mayflower Hotel in downtown Washington is unable to meet its debt because of falling room rates, said Frank Innaurato, managing director of the credit-rating firm Realpoint, and the Boulevard at the Capital Centre in Largo, after losing several national retailers, had to extend its $71.5 million bank loan when it matured last fall, according to CoStar.

An office building at 1150 18th St. NW, bought in 2007 for $57.5 million, was sold at foreclosure in December for $21.7 million after losing 25 percent of its tenants, according to CoStar. Even the Mortgage Bankers Association has fallen victim, selling its $90 million Washington headquarters earlier this month for $41 million. Real Capital Analytics and others, however, attribute the surge here largely to Tishman Speyer Properties, which has about 20 D.C. office buildings, according to public records and real estate analysts, and last month walked away from its $5.4 billion Stuyvesant Town and Peter Cooper Village apartments in New York after defaulting on the mortgage.

Now a rival, Brookfield Properties, is buying the company's debt on the D.C. buildings, according to Debtwire, which reports on distressed properties. They include International Square on the 1800 block of I Street NW and several buildings on Pennsylvania Avenue NW. The company, according to the report, defaulted on its loan during the summer.

In a statement, Tishman Speyer said it is continuing "discussions with our lender group" on its D.C. area debt. Neither Tishman Speyer nor Brookfield commented on the purported deal.
Plans undermined

What happened to Broadway 401, which operates the Dumont on Massachusetts Avenue NW near Fourth Street, has become an all-too-familiar story. In 2006, it borrowed $190 million, constructing two high-rise condominium buildings at the height of the District's real estate boom.

But the market crashed, and Broadway wasn't able pay off the loan when it matured in August 2008 because it couldn't sell enough units, according to court filings. About a year later, with the lenders seeking to foreclose, Broadway tried to sell the properties. It gave up after the buildings, appraised at only $140 million, garnered bids ranging from $90 million to $133 million. Finally, last month, Broadway filed for Chapter 11 bankruptcy protection, saying it owed $250 million from its unpaid principal and accrued interest from various loans.

David Weldler, manager of the Broadway properties, did not respond to phone messages seeking comment. In the bankruptcy filing, he said the recession undermined the business plan. "The volume of residential sales has dropped significantly in the U.S., residential prices have declined and credit standards have been tightened, making it considerably more difficult" for buyers to qualify for loans, he wrote.

Rockwood Capital, which owns the Mayflower, is in discussions with its lender to modify its loan, Innaurato said. The hotel reduced its rates to maintain occupancy, Innaurato said, and fell behind on payments.

"The loan was 30 days delinquent in January 2010," Innaurato said. Officials at Rockwood Capital declined to comment. "They're most likely asking to lower the interest rate or forbearance of payment."

Staff researcher Meg Smith contributed to this report.

Commission of sin Daily Caller



Commission of sin
Daily Caller
By Michael Tanner 02/22/10 at 12:00 am


So, President Obama wants a presidential commission on the budget deficit. Isn’t that a little bit like W.C. Fields asking for a commission on sobriety?

Hypocrisy aside, the whole idea of a deficit commission is misguided.

That’s not to say budget deficits are good. This year, the federal government will run a deficit of more than $1.35 trillion this year. “Yes, that’s trillion with a “T.” That’s a deficit larger than the entire federal budget in 2000. And things are only going to get worse in the future. The Obama administration projects further deficits of more than $9 trillion over the next 10 years. Our total national debt exceeds $12 trillion and counting, with huge shortfalls in Social Security and Medicare just over the horizon. Clearly, this can’t go on.

But to focus on the deficit is to confuse the symptom with the disease.

As Milton Friedman often explained, the real issue is not how you pay for government spending—debt or taxes—but the spending itself. In other words, don’t just look at the deficit; look at why we have a deficit. And the reason why we have a deficit is pretty simple—government spends too much.

For years, Republicans have tried to dodge the tough questions about government spending by substituting debt for taxes. They felt that as long as they were cutting taxes, no one would notice that they were spending like drunken Democrats.

Now, Democrats want to substitute taxes for debt. They haven’t sobered up, they just want someone else to pay the bar tab. Both are equally wrong.

As mentioned, when President Bush became president, the entire federal budget was $1.2 trillion. By the time he left office, it was $2.9 trillion. This year, President Obama proposed a federal budget that would spend $3.55 trillion.

As a result of this bipartisan profligacy, federal spending topped 24.7 percent of gross domestic product last year, the highest peacetime percentage in U.S. history. And, while the optimistic projections of the most recent Obama budget see that declining ever so slightly to 23.7 percent by 2020 (for comparison the historical average has been roughly 21 percent of GDP). But that respite, such as it is, will be only temporary. As the full force of entitlement programs kicks in, the federal government will consume more than 40 percent of GDP by the middle of the century. Throw in state and local government spending, and governments will control well over half of the U.S. economy.

Meanwhile, federal taxes have traditionally run at around 18 percent of GDP. (Currently, they are down somewhat, around 15 percent of GDP). Thus, a growing budget gap, to which we can expect a commission to respond—well, raise taxes.

Think about how much taxes would actually have to be raised to pay for all the government spending to come. Would we really be better off if, in 2050, federal government spending reached 40 percent of GDP, but we essentially double taxes in order to pay for it? There would be no deficit, but we would liable to be much poorer. After all, every dollar that government spends is a dollar that is siphoned off from American workers regardless of whether it is raised through debt or taxes. Both divert money from more efficient uses in the private sector to less-productive uses in the public sector. Both mean fewer jobs and less economic growth.

More importantly, we should remember that every dollar the government spends is one less dollar that Americans can spend on food, clothing, housing, charitable contributions, or other goods and services of their choosing. It is, after all, their money.

We don’t need a commission to make it easier to raise taxes. We need the political courage to confront out-of-control government spending.

Michael D. Tanner is a senior fellow at the Cato Institute.

Rational Or Emotional? Your Brain On Food - NPR



Rational Or Emotional? Your Brain On Food - NPR


Willpower plays a role in dieting. But keeping the weight off after you've lost it? This is where our physiology can get in the way. Research suggests that hormone shifts that follow weight loss play a role in changing the way our brain responds to food.

"After you've lost weight, you have an increase in the emotional response to food," says Columbia University Medical Center researcher Michael Rosenbaum, who studies the body's response to weight loss. He says you also see "a decrease in the activity of brain systems that might be more involved in restraint."

And there's another factor making weight loss maintenance tough, too: a slower metabolism. When you lose weight, the body adapts to conserve energy, so it just doesn't need as many calories.

One of the hormones that play a role in controlling appetite in the body is called leptin. After significant weight loss, leptin levels drop. This seems to signal to the brain a need to seek more food.

Rosenbaum and his colleague Joy Hirsch, a neuroscientist at Columbia University Medical Center, designed an experiment to better understand the relationship between the brain, leptin and weight-loss maintenance.

They recruited overweight volunteers who agreed to a calorie-restricted diet aimed at shedding 10 percent of body weight. Using fMRI scans, the researchers looked at how the volunteers' brain responses to seeing food changed after weight loss.

Still Emotionally Attached

During their study, Hirsch and her colleagues found some interesting patterns of neural activity in their volunteers after they'd lost weight.

For instance, there was more blood flow to areas of the brain known to be involved in the emotional control of food intake, such as the brainstem and parahippocampal gyrus.

But here's the fascinating part: When they restored leptin to these volunteers by giving them injections of the hormone, the brain response changed. When they saw food, there was more activity in brain areas associated with conscious decisions.

"It's a feedback mechanism," says Rexford Ahima of the University of Pennsylvania. Leptin signals the brain; when there's a deficiency of the hormone, the areas of the brain associated with reward-seeking become more active.

This evolutionary programming is out of sync with what's healthiest for our bodies. The signal evolved over thousands of years when food was scarce. It was the brain's way of telling the body to seek food and protect fat stores. Many people — particularly those who are prone to gain weight easily — have retained more genes that program us to seek food.

As for the role of leptin, researchers say it's clear that leptin is not an anti-obesity hormone — it won't help you lose weight.

But Ahima says the most recent research suggests that leptin — or drugs that would stimulate leptin signaling — could potentially facilitate the maintenance of weight loss. So far, this has only been tested in experimental trials.

My Brain's Response To 'The Food Parade'
Tupperware full of food
Allison Aubrey/NPR

Researchers tested subjects, including NPR's Allison Aubrey, by showing them a mirror image of the real foods displayed above. They compared their brain response to food with the brain activity when it viewed mundane household objects.

The researchers invited me to their lab at the Neurological Institute at Columbia to see exactly how the experiment works. Curious about how my brain would respond to food, I agreed to an fMRI scan.

As I lay in the scanner, I watched through a mirror as research assistants passed all kinds of foods — from carrot sticks and apples to Hershey's Kisses and cookies — through my line of sight.

"Think of it as a food parade," explained Hirsch. After 20 minutes of watching food, the researchers began analyzing my brain responses.

"You will see a very specific circuit in your brain that's associated with the appreciation of foods," explained Hirsch.

Hirsch says the patterns in my brain images were similar to those of test subjects with restored leptin. She pointed to areas in my parietal and frontal lobes that had activated as I watched the "food parade."

"This is the executive part of the brain," says Hirsch. "You're responding like somebody in a homeostatic [stable] state." This means that when I saw the images of food, my brain activated decision-making areas, and there wasn't nearly as much activity in the emotional, reward-seeking parts of the brain. Hirsch also pointed out that my brain showed lots of stimulation in areas related to visual processing.

Researchers spotted drastic difference in Aubrey's brain activity when she looked at foods, as compared to mundane objects like a cell phone. Areas of the brain associated with visual stimulation really lit up.

Of course my brain response could change. The brain images captured just a snapshot in time. But it was fascinating to see that I didn't have a very emotional response to food. By comparison, images they'd shown me of mundane household objects — such as a cell phone — didn't evoke nearly as much activity in the areas associated with executive function or visual processing.

Hirsch and Rosenbaum's findings were published in the Journal of Clinical Investigation. They're now working on follow-up studies to figure out if people's behavior maps with what they're seeing in brain scans.

"It's a work in progress," says Hirsch. But she thinks this research is showing that our physiology tends to set the brain in one of two modes:

The "regain" mode, which nudges us, emotionally, to seek food. Or the "retain" mode, which helps us maintain a steady weight. Researchers are following up with more studies to see if people's eating behaviors mirror their brain response to food.

Saturday, February 20, 2010

Freight Transportation Services Index (TSI) Unchanged in December from November

Freight Transportation Services Index (TSI) Unchanged in December from November

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BTS 08-10
Dave Smallen
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Thursday, February 18, 2010 - The Freight Transportation Services Index (TSI) was unchanged in December from its November level, after one monthly increase, the U.S. Department of Transportation’s Bureau of Transportation Statistics (BTS) reported today (Table 1).

BTS, a part of the Research and Innovative Technology Administration, reported that though the Freight TSI declined 4.1 percent during 2009 (Table 3) the index increased 2.9 percent over the last seven months of the year, beginning in June (Table 2). For additional historical data, go to http://www.bts.gov/xml/tsi/src/index.xml

The Freight TSI measures the month-to-month changes in freight shipments in ton-miles, which are then combined into one index. The index measures the output of the for-hire freight transportation industry and consists of data from for-hire trucking, rail, inland waterways, pipelines and air freight.

The December Freight TSI of 96.2 is a 2.9 percent increase from the recent low of 93.5 reached in May. In May, the index was at its lowest level since June 1997. The Freight TSI is down 14.8 percent from its historic peak of 112.9 reached in May 2006.

With the 4.1 percent decline in 2009 following an 8.7 percent decline in 2008, the Freight TSI has declined 12.4 percent in two years (Table 3).

The December Freight TSI of 96.2 is the lowest for December since December 1996 when it was 89.1. The 4.1 percent decline in the Freight TSI from December 2008 to December 2009 was the fourth largest annual decline in the 20 years for which the TSI is calculated. It was the third largest decline in the past decade, exceeded by declines in 2000 and 2008 (Table 4).

The freight index is also down 13.2 percent in the five years from December 2004. The index is down 8.4 percent in the 10 years from December 1999 (Table 5).

The TSI is a seasonally adjusted index that measures changes from the monthly average of the base year of 2000. It includes historic data from 1990 to the present. Release of the January index is scheduled for March 10.

For a video explanation of the TSI, see Overview of the Transportation Services Index. For a BTS report explaining the TSI, Transportation Services Index and the Economy is available for download in the BTS bookstore.

Friday, February 19, 2010

France's Carrefour says plans 2010 entry into India

France's Carrefour says plans 2010 entry into India

(AFP) – 4 hours ago

NEW DELHI — France's Carrefour, the world's second largest retailer, said Friday it plans to enter India's vast retail market in 2010 following years of delays.

"Carrefour will develop its activities in India with the start of cash-and-carry activities in 2010," the company said in a statement emailed to AFP.

Cash-and-carry is the term used for wholesale outlets.

Carrefour, number two behind US retail giant Wal-Mart, added in the statement it had been "discussing partnerships" with some Indian companies but that it did not wish to divulge names.

The company has been scouting for years for Indian partners. Retail tycoon Kishore Biyani has often been mentioned and Carrefour and his Future Group were linked most recently in an Indian media report in January.

India's estimated 500-billion-dollar retail sector is seen as having high growth potential but it remains tightly regulated with large retailers accounting for around six percent of industry sales.

Carrefour had previously said it planned to have an Indian franchisee which would open branded hypermarkets in the country. It had said Carrefour's 100-percent-owned cash-and-carry business would supply these stores.

Under India's tight foreign investment rules, no foreign chains are permitted in the retail sector -- except for single-brand outlets such as Nokia or Reebok -- to protect local retail players.

Foreign groups can only be wholesalers and must partner with domestic companies to enter the retail market.

Last year, Wal-Mart opened its first sales venture in India, teaming up with Bharti Enterprises, parent of India's biggest mobile firm Bharti Airtel, in a wholesale joint venture called Best Price Modern Wholesale.

Carrefour's announcement came as the retailer reported separately that net profit tumbled in 2009 by 74.2 percent to 327 million euros (505 million dollars), hit by huge restructuring charges.

Wal-Mart suffers sales decline in key quarter

Wal-Mart suffers sales decline in key quarter
By Parija Kavilanz, senior writerFebruary 18, 2010: 12:17 PM ET


NEW YORK (CNNMoney.com) -- Wal-Mart Stores posted a quarterly profit Thursday that beat Wall Street's expectations, but the retailer's store sales dropped during the period that included the all-important year-end holiday sales.

Wal-Mart, the world's largest retailer, said fourth-quarter sales at its stores open at least a year - a key gauge of retailers' performance known as same-store sales - fell 1.6% compared to a 2.4% increase for the same period a year ago.

For the full year, Wal-Mart (WMT, Fortune 500) said its same-store sales were flat compared to a 2.8% increase last year.

"I am disappointed that [our] U.S. comparable sales were below expectations in the quarter," Wal-Mart CEO Mike Duke said during a pre-recorded call to discuss the company's results.

"The economy is a real challenge for many of our customers," he added, warning that Wal-Mart's first-quarter sales "will be difficult" due to tougher year-over-year sales comparisons and ongoing price deflation in some of its key merchandise categories including food and electronics.

"We believe we will see improvements as the year progresses," Duke said in the call.
Fewer shoppers

Wal-Mart, which averages more than 100 million shoppers to its stores every week, is often seen as a barometer of the state of consumer spending.

Therefore its sales decline will likely raise concerns that consumers still aren't shopping freely. That's a troubling sign, given that consumer spending fuels two-thirds of the nation's economic activity.



Eduardo Castro-Wright, vice chairman of Wal-Mart stores, said during the call that the same-store sales decline was fueled by a "slight drop in [customer] traffic to Wal-Mart stores in the fourth quarter" as well as a decline in the total value of purchases that customers were making at Wal-Mart.

Grocery and consumer electronics were impacted the most by price deflation while sales of health and wellness, and pharmacy products were strong, said Castro-Wright.

Wal-Mart said it expects same-store sales to be flat to "plus or minus 1%" in its first quarter.

At the company's Sam's Club division, same-store sales rose a slight 0.7% in the quarter and were up 1.4% for the full year.

Wal-Mart said it expects same-store sales at its warehouse club division to also be "flat, plus or minus 1%" in the first quarter as membership renewal rates continue to be flat.

Wal-Mart's international operations - including Brazil and China - delivered the best performance in the quarter. The company said Wal-Mart International ended fiscal year 2010 with more than $100 billion in net sales and "strong double-digit sales growth" in the fourth quarter.
By the numbers

The retailer said profit climbed to $4.7 billion, or $1.23 a share, during its fourth-quarter ended Jan. 31.

Excluding certain one-time charges, Wal-Mart reported earnings of $1.17 per share. Analysts polled by Thomson Reuters, who typically strip out one-time charges, were expecting a profit of $1.12 a share for the three months ended Jan. 31.

Sales at Wal-Mart increased 4.6% to $112.8 billion during the quarter. Analysts expected revenue to climb 5% to $114.4 billion.

For the full year, Wal-Mart reported an 8.8% jump in profit to $14.4 billion, and sales rose 1% to $405 billion.

The Bentonville, Ark.-based company expects to earn between 81 cents and 85 cents per share for the current quarter, while analysts expect the company to earn 85 cents per share.

For the full fiscal 2011 year, Wal-Mart expects to earn between $3.90 and $4.00 per share compared to analysts' current estimate of $3.97 per share for the year.

Shares of Wal-Mart (WMT, Fortune 500) declined less than 1% in pre-market trading.

--CNNMoney.com staff writer Hibah Yousuf contributed to this report. To top of page