News Taliban and U.S. Revive Talks in Qatar, Karzai Says

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Taliban and U.S. Revive Talks in Qatar, Karzai Says
Mar 10th 2013, 07:21

KABUL (Reuters) — The Afghan Taliban and the United States have been holding talks in the Gulf Arab state of Qatar, President Hamid Karzai of Afghanistan said on Sunday.

Reuters

The Taliban suspended the talks one year ago, blaming "shaky, erratic and vague" U.S. statements.

The U.S. government has said it remained committed to political reconciliation involving talks with the Taliban but progress would require agreement between the Afghan government and the insurgents.

"Senior leaders of the Taliban and the Americans are engaged in talks in the Gulf state on a daily basis," Karzai told a gathering to mark International Women's Day.

But the Taliban spokesman in Afghanistan, Zabihullah Mujahid, denied that negotiations with the United States had resumed and said no progress had been made since they were suspended.

"The Taliban strongly rejects Karzai's comments," he said.

U.S. officials could not be immediately reached for comment.

The Kabul government has been pushing hard to get the Taliban to the negotiating table before most U.S.-led NATO combat troops withdraw by the end of 2014.

Afghan officials have not held direct talks with the militants, who were toppled in 2001 and have proven resilient after more than a decade of war with Western forces.

U.S. diplomats have been seeking to broaden exploratory talks with the Taliban that began clandestinely in Germany in late 2010 after the Taliban offered to open a representative office in Qatar.

U.S. Defense Secretary Chuck Hagel is in Afghanistan to visit U.S. troops.

Hagel, who arrived on Friday for his first trip abroad as defense secretary, is also due to hold talks with Karzai, whose recent orders to curtail U.S. military activity highlights an often tense relationship with the 66,000 American forces here.

Hagel's visit also coincides with the passing of a deadline imposed by Karzai for U.S. special forces to leave the province of Wardak, after Karzai accused them of overseeing torture and killings in the area.

U.S. forces have denied involvement in any abuses and it was not clear if they were leaving Wardak by the deadline.

Regional power Pakistan indicated a few months ago that it would support the peace process by releasing Afghan Taliban detainees who may help promote the peace process.

But there have been no tangible signs the move advanced reconciliation.

(Additional reporting by Hamid Shalizi; Writing by Michael Georgy; Editing by Robert Birsel)

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News Knicks 113, Jazz 84: Knicks’ Stoudemire Needs Operation on What Had Been His Good Knee

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Knicks 113, Jazz 84: Knicks' Stoudemire Needs Operation on What Had Been His Good Knee
Mar 10th 2013, 03:41

Jason Szenes for The New York Times

J. R. Smith scored 24 points against the Jazz, but the Knicks may need even more from him with Carmelo Anthony and Amar'e Stoudemire injured.

Amar'e Stoudemire made his season debut for the Knicks on New Year's Day, and the team embraced his return as a way to breathe fresh life into the roster just as their sensational start began looking more serious.

There were some halting initial games, and worries about his durability after an operation on his left knee in October, but those concerns seemed to shrink with each rebound and dunk; in time, there were a lot of both. But on Saturday, after 29 games for Stoudemire, the Knicks' worst fears were realized when he woke up with his right knee sore and swollen, and a magnetic resonance imaging test revealed that another operation was necessary.

Stoudemire is expected to miss the next six weeks, the team said before Saturday's game against the Utah Jazz. That is a hopeful estimate, given that he needed eight weeks to recover from a similar procedure — called a debridement — in October.

Any recovery timetable puts Stoudemire's return during the postseason. Without him, the question is whether the Knicks can last that long.

"It's a loss, a major loss," Knicks Coach Mike Woodson said before Saturday's game. "We're going to have to wait on him and continue our climb. We can't sit and sulk."

The Knicks were 21-9 without Stoudemire to begin the season, and they beat the Jazz, 113-84, without him on Saturday at Madison Square Garden. The Knicks were also without Carmelo Anthony; he has missed three straight games with an unspecified right knee injury.

Woodson said Anthony remained day to day and that he would be re-evaluated Sunday before the team leaves on a five-game trip. In his absence, J. R. Smith continued his torrid scoring stretch, finishing with 24 points in 28 minutes. Raymond Felton added 15 points and Steve Novak went 5 for 10 from 3-point range.

The Knicks (38-22) fell behind, 11-4, but used a 15-0 run in the first quarter to build a lead and then finished the half on a 22-9 run. They held the Jazz to 38.5 percent shooting and won for the sixth time in eight games.

If there was any hangover from the Stoudemire news, the team did not show it. Novak said the players were notified of Stoudemire's injury shortly after they arrived at the Garden.

"We were taken aback," Jason Kidd said. Stoudemire had scored 16 points in 30 minutes against Oklahoma City on Thursday, showing no apparent signs of physical struggle.

But he missed the Knicks' morning shootaround Saturday with what Woodson described as knee soreness. It was revealed later that he had had an M.R.I., and the results were not comforting.

A debridement is a procedure to remove damaged cartilage or tissue in the knee. Stoudemire had a similar operation on his left knee in October, in part because of a ruptured cyst in the area.

He has had two other knee operations: in 2005, he had microfracture surgery on his left knee, and in 2006, he had an arthroscopic procedure on his right. Stoudemire, who has three years remaining on a contract worth $100 million, has not played a full N.B.A. season since 2009-10.

The Knicks had been cautious about easing him back into the rotation in January, bringing him off the bench and restricting him to 30 minutes a game. Feeling better, Stoudemire had pushed that limit twice in the last week, playing 32 and 31 minutes against Cleveland and Detroit.

What affect that might have had on his knee is uncertain. Stoudemire had clearly been playing well enough to warrant the additional time.

He averaged 15.1 points and 5.6 rebounds in 24.5 minutes in his previous 10 games. In 29 games, Stoudemire had led the Knicks in scoring once, in rebounding twice, and had scored at least 20 points six times.

"Amar'e's been playing great," center Tyson Chandler said. "He's been one of the best pick-and-roll players since he came into the game. Not having him is obviously a big blow."

Losing Stoudemire reinforced the fragility of the Knicks, who have the oldest roster in the N.B.A. and a litany of injuries. Stoudemire, 30, joins Rasheed Wallace, 38, on the team's injured list, and Anthony, Felton and Kidd, who will turn 40 later this month, have each missed considerable time.

Without Stoudemire, the Knicks will be forced to rely more on 35-year-old Kenyon Martin, whom they recently signed, and a collection of other role players, like Kurt Thomas, James White and Novak. Smith will be expected to pick up his role as the team's second-leading scorer.

"It's unfortunate to try to benefit from someone's injury, but I know that injuries are a part of the game," Martin said. "You try to take advantage of it."

As the season wends into its final stretch, though, the loss of Stoudemire puts the Knicks' pursuit of the Atlantic Division title in jeopardy. Stoudemire provided the Knicks with an instant offensive punch in the low post. Knowing his minutes limit, he was at times electrifying, like a closer in baseball who threw only his best pitches.

He will have at least six weeks to rest even more. The Knicks hope they will still be playing when he returns.

"Amar'e is a big piece of this thing, when you're talking about getting deep into the playoffs," Woodson said. "Amar'e had come back and really established himself to help us from an offensive standpoint on that low block."

He added: "When you start playing playoff basketball, you need some low-post play, you need to mix it up a little bit. So we're going to miss that."

A version of this article appeared in print on March 10, 2013, on page SP1 of the New York edition with the headline: Stoudemire Needs Operation On What Was His Good Knee .

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News Harvard Hacked Staff E-Mails

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Harvard Hacked Staff E-Mails
Mar 10th 2013, 04:19

Harvard secretly searched the e-mail accounts of several of its staff members last fall, looking for the source of news media leaks about its recent cheating scandal, but did not tell them about the searches for several months, people briefed on the matter said on Saturday.

The searches, first reported by The Boston Globe, involved the e-mail accounts of 16 resident deans, but most of them were not told of the searches until the last few days, after The Globe inquired about them. Resident deans straddle the roles of administrators and faculty members, teaching classes as lecturers while living in Harvard's undergraduate residential houses as student advocates and advisers.

In August, an administration memo to the resident deans, on how to advise students being brought up on cheating charges before the Administrative Board, a committee of faculty members responsible for enforcing regulations, made its way to news organizations. The e-mail searches were intended to find the source of leak, but no one was disciplined in the matter.

Last August, Harvard publicly revealed that "nearly half" the students in a large class were suspected of having cheated on a take-home final exam in the spring of 2012 — either working together in violation of instructions, or outright plagiarizing material. Students identified the class as a government course with 279 people enrolled.

Harvard declined to comment on Saturday about the e-mail searches, but offered what appeared to be an oblique defense.

"If circumstances were to arise that gave reason to believe that the Administrative Board process might have been compromised, then Harvard College would take all necessary and appropriate actions under our procedures to safeguard the integrity of that process, which is designed to protect the rights of our students to privacy and due process," Michael D. Smith, dean of the Faculty of Arts and Sciences, said in a prepared statement.

The handling of the search — if not the search, itself — may have contradicted the Faculty of Arts and Sciences policy on electronic privacy, and faculty members interviewed said they expected a backlash. The privacy policy states that the administration can search faculty members' electronic records "in extraordinary circumstances such as legal proceedings and internal Harvard investigations."

But it also says that a faculty member must be notified in advance of such a search, "unless circumstances make prior notification impossible, in which case the faculty member will be notified at the earliest possible opportunity."

Over months of investigations and hearings by the Administrative Board, some of the accused students insisted that their degree of collaboration was no more than the accepted norm, and that the professor and teaching fellows were partly to blame. The episode drew particular attention because the class was popular with varsity athletes, some of whom left school rather than face the loss of a year of athletic eligibility.

On Jan. 31, Dr. Smith said that "somewhat more than half" of those cases resulted in students being required to withdraw, putting the number forced out at roughly 70.

A version of this article appeared in print on March 10, 2013, on page A23 of the New York edition with the headline: Harvard Hacked E-Mails In Search of Media Leaks .

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News News Analysis: Threats Sow Concerns Over Korean Armistice

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News Analysis: Threats Sow Concerns Over Korean Armistice
Mar 10th 2013, 02:54

North Korea's latest threats to annihilate its enemies have included a vow to scrap the 1953 armistice, the main legal document that theoretically stands in the way of a resumption of the Korean War, a conflict that by some estimates left nearly five million people dead, including more than 33,700 American soldiers.

A 1953 armistice was meant to be a temporary measure.

But the North Koreans have said many times over the years that they were disregarding the armistice. It is not a peace treaty but rather a military document, reflecting what was at the time a stalemated conflict that no one wanted to prolong.

What is unclear is whether North Korea will make good on its vow to disregard the armistice this time, and what such a step would mean. While it may be bluster, analysts who study North Korea are not so sure.

Some fear that Kim Jong-un, the North's young and untested leader, perhaps believing that his country is now a nuclear power, may regard the armistice as outdated, reflecting deterrents that no longer exist. If so, they say, he could feel emboldened to carry out a military provocation against South Korea.

The armistice was meant to be temporary, until a peace treaty between the governments in the conflict could be reached. It was the basis for the mechanisms that deter a resumption of the war, including the demilitarized zone separating the two Koreas, a communications hot line and a joint commission for resolving allegations of violations.

"An armistice reflects a balance of forces, the combatants reach a state of exhaustion, so you get a sort of equilibrium," said Stephan M. Haggard, a visiting fellow at the Peterson Institute for International Economics in Washington. "The armistice sustains itself in part because the parties recognize they can't make gains by fighting."

In a blog post on the institute's Web site, Mr. Haggard enumerated more than a half-dozen instances since 1991 when North Korea vowed to abandon the armistice or challenged its legitimacy. The North's latest threat, he wrote, could mean that it feels empowered by nuclear arms to strike with impunity, or that it simply regards the armistice as unsupportable.

"Or," he wrote, "it could be just noise and signify nothing. Not knowing what the North Koreans really think is a central source of the current instability on the peninsula at the moment."

In the past, North Korea has raised the fear of accidental or uncontrolled military clashes along the border as a way to push Washington into bilateral talks. The North, officials in South Korea say, craves the prestige that such a dialogue would confer on it, but it would undoubtedly demand the withdrawal of American troops from South Korea.

The armistice states that any change must be agreed to by all the signers and that unilateral declarations are unacceptable — a point reiterated Thursday by Gen. James D. Thurman, the American commander in charge of enforcing the armistice conditions. He was responding to the North's assertion that it would consider the armistice null and void as of Monday, when military exercises by the United States and South Korea get under way.

"For over 60 years, the armistice agreement has ensured peace and stability on the Korean Peninsula," General Thurman said. "It is concerning when any signatory to a mutual agreement makes a public statement contrary to that agreement."

But given North Korea's history of seemingly irrational behavior at times, the legal notification obligations required in the armistice may be regarded as irrelevant in North Korea.

Last week, North Korea's main party newspaper said that the country was justified in unilaterally nullifying the armistice because its repeated demands for peace talks since the 1970s had been snubbed by Washington.

"This is the most opaque country in the world," said William R. Keylor, a professor of international relations at Boston University. He called the North Korean threat to disregard the armistice "a very serious development."

Professor Keylor and others also said they saw a message of anger in the North's threat that was directed at China, its Korean War ally. Many senior North Korean officials, some of them veterans of the war, may regard it as a betrayal that China collaborated with the United States to draft the new United Nations Security Council sanctions that penalized the North for its third nuclear test last month.

"It's possible this is a signal to the Chinese government from the North Koreans that they're going to go their own way," Professor Keylor said. "By canceling the armistice, they're saying, 'We're pursuing our own policy.' "

Jae H. Ku, director of the U.S.-Korea Institute at the Paul H. Nitze School of Advanced International Studies in Washington, said the armistice threat might be "putting Beijing on notice that siding with the sworn enemy is going to have repercussions."

But Mr. Ku also expressed concern that the North's repudiation of the armistice might reflect a miscalculation by the new North Korean leader.

"When the god-king says something, you put it on paper — that's what really makes me nervous, some military official taking literally this 28-year-old's musings," Mr. Ku said. Mr. Kim's predecessors were older and knew how to tamp down tensions, Mr. Ku said, and "I'm not sure this young leader understands that."

Choe Sang-Hun contributed reporting from Seoul, South Korea.

A version of this news analysis appeared in print on March 10, 2013, on page A19 of the New York edition with the headline: Threats Sow Concerns Over Korean Armistice .

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News Building Tiny Parks to Drive Sex Offenders Away

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Building Tiny Parks to Drive Sex Offenders Away
Mar 10th 2013, 00:31

Monica Almeida/The New York Times

A vacant lot in the Harbor Gateway area of Los Angeles will be turned into a park, forcing out paroled sex offenders.

LOS ANGELES — Parents who pick up their children at the bus stop in this city's Harbor Gateway neighborhood say they often see men wearing GPS ankle bracelets and tell their children to stay away. Just up the street, 30 paroled sex offenders live in a single apartment building, including rapists and child molesters. More than 100 registered sex offenders live within a few miles.

So local residents and city officials developed a plan to force convicted sex offenders to leave their neighborhood: open a tiny park.

Parents here, where state law prohibits registered sex offenders from living within 2,000 feet of a school or a public park, are not the only ones seizing on this approach. From the metropolis of Miami to the small town of Sapulpa, Okla., communities are building pocket parks, sometimes so small that they have barely enough room for a swing set, to drive out sex offenders. One playground installation company in Houston has even advertised its services to homeowners associations as an option for keeping sex offenders away.

Within the next several months, one of Los Angeles's smallest parks will open here in Harbor Gateway, on a patch of grass less than 1,000 square feet at the corner of a busy intersection. But even if no child ever uses its jungle gym, the park will serve its intended purpose.

"Regardless of whether it's the largest park or the smallest, we're putting in a park to send a message that we don't want a high concentration of sex offenders in this community," said Joe Buscaino, a former Los Angeles police officer who now represents the area on the City Council.

While the pocket parks springing up around the country offer a sense of security to residents, they will probably leave more convicted sex offenders homeless. And research shows that once sex offenders lose stable housing, they become not only harder to track but also more likely to commit another crime, according to state officials involved with managing such offenders.

"Putting in parks doesn't just break up clusters — it makes it impossible for sex offenders to find housing in the whole city," said Janet Neeley, a member of the California Sex Offender Management Board. "It's counterproductive to public safety, because when you have nothing to lose, you are much more likely to commit a crime than when you are rebuilding your life."

Restrictions on where sex offenders can live, which have been passed in most states, have already rendered most residential areas in many cities off limits.

The number of homeless sex offenders in California has increased threefold since 2006, when the latest residency restrictions were passed, and a third of sex offenders on parole are now homeless, according to reports from the Sex Offender Management Board.

The others cluster in the few pockets where they are still allowed, like Harbor Gateway, a working-class neighborhood that stretches south of the main part of the city along Interstate 110.

Because of continuing litigation over the residency restrictions, it is unclear exactly how many of the sex offenders living near the new Harbor Gateway park would have to leave the area, or when. Currently, all sex offenders, even those whose crimes were not violent or against children, must register for life in California, but only those on parole are prevented from living near parks and schools. About 3.5 percent of paroled sex offenders commit a new sex crime before the end of their three-year parole period, according to a 2008 Sex Offender Management Board report.

The pocket park policy has been an unmitigated political victory for Mr. Buscaino, who easily won re-election to the City Council on Tuesday. The park's groundbreaking last month became a neighborhood celebration, complete with a marching band and residents who loudly cheered Mr. Buscaino and other local officials.

"I think it's great," said Patti O'Connell, 58, who lives a block from the park. "I just feel sorry for wherever they're moving to. It's scary that there's sex offenders all around with all these little kids here."

And Mr. Buscaino is moving ahead with plans to squeeze even further the areas in Los Angeles where sex offenders can live.

Two more pocket parks are planned for another neighborhood in Mr. Buscaino's district, in hopes of breaking up a cluster of sex offenders who live there. He also hoped to bar sex offenders in Los Angeles from living near day care centers and after school programs, as other cities have already done.

The park in Harbor Gateway will cost only about $300,000, because the city already owns the land. But one of the other new parks, which will be three acres, will cost the city about $6 million, including buying the land.

Mr. Buscaino said he supported housing for sex offenders, but said the pocket park would improve the quality of life in Harbor Gateway.

"Let's house them, absolutely, but not in a high-population area like this one," he said.

Many of the sex offenders who live near Harbor Gateway have been placed there with the help of parole officers, precisely so they would not end up on the street.

The landlord of some nearby apartments where dozens of sex offenders on parole live, who spoke on the condition of anonymity for fear of retaliation, said that keeping paroled sex offenders together in transitional housing actually kept the community safer because it places controls on them even after they leave prison.

The doors are locked by keypads so that officers can regularly check on the parolees, he said. Residents are under strict curfews and are not allowed to drink, use drugs or view pornography while living in the apartments. If they violate those rules, parole officers can send them back into custody.

"People come out of jail, and they just become homeless," the landlord said. "They have no food, no money, no anything. What's the possibility then that they're going to reoffend? They can add all the parks they want, but they still have to go somewhere."

In some urban areas, however, there is already nowhere left for sex offenders to legally live.

In Miami, dozens of convicted sex offenders camped under a bridge, unable to find any other shelter, until the encampment was broken up several years ago. Another camp in Miami, where a dozen offenders slept on the sidewalk, was dispersed last year when Marc Sarnoff, a city commissioner, had three pocket parks built in the neighborhood.

Mr. Sarnoff said he did not know where the offenders ended up.

"There has to be a strategy in place so they don't just live on the sidewalk," Mr. Sarnoff said. "We need more resources in place so these guys don't reoffend. But that's beyond the city's resources. It has to be at the state level."

A version of this article appeared in print on March 10, 2013, on page A22 of the New York edition with the headline: Neighborhoods Seek to Banish Sex Offenders by Building Parks.

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News Power Struggle on Reforming Vatican Bank

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Power Struggle on Reforming Vatican Bank
Mar 10th 2013, 00:10

Gabriel Bouys/Agence France-Presse — Getty Images

The Vatican bank has for decades been the subject of dark intrigue and also has been linked to one mysterious death.

VATICAN CITY — Negotiations over the Vatican's adherence to international banking standards were reaching a delicate point. During a lunch, a European official later recalled, discussion turned to the need for more openness from an institution steeped in centuries of secrecy.

A Vatican representative at the meal, annoyed by the requests for more information, shouted, "How can you ask us such questions?"

The clash came amid mounting pressure on the Vatican to clean up its bank — for decades the subject of dark intrigue and linked to one mysterious death — as part of a push by the European Union to apply common rules to all the countries and micro-states like Vatican City and Monaco that use the euro.

Those pressures continued until the very last days of Pope Benedict XVI's papacy and remain a critical issue for the cardinals now meeting to elect a new pope. As the conclave begins Tuesday, the specter of financial scandal presents a special challenge for Benedict's successor, who must modernize the Roman Catholic Church's finances or risk the Vatican's access to the global banking system, undermining its moral authority and its financial stability.

Ahead of the conclave, the cardinals were briefed on the Vatican's finances and have been debating whether a member of the Vatican hierarchy or an outsider would be better at imposing order after a papacy bedeviled by crises of governance. The battle lines are hazy, but the fight over the Vatican's finances pits different factions inside the Vatican against one another, some seeking greater transparency and others who want to preserve the institution's tradition of secrecy.

Founded in 1942 and housed in a small round tower at the foot of the Apostolic Palace, the Vatican bank generally does not give loans but manages deposits and patrimony for religious institutions, clerics and diplomats accredited to the Vatican, who are among the only depositors allowed to hold accounts there.

During the cold war, the bank was widely seen as a back channel to transfer money to the Eastern Bloc to help end Communism, and today the Vatican uses the bank to help it operate in sensitive areas like Cuba and China, Vatican experts say.

But largely because of the Vatican's reluctance to reveal its account holders to outside authorities — and especially to subject itself to scrutiny of past transactions — suspicion has swirled for years about whether some of its accounts had ties to organized crime or Italian political slush funds.

In 2011, the only time for which figures have been made available, it had 20,772 clients, 68 percent of them members of the clergy, and $8.2 billion in assets under its management. The bank has said it has around 33,000 accounts.

In recent years, Italian prosecutors have become more aggressive in investigating whether accounts held there by clerics might in fact be fronts for other interests. Last July, the Italian authorities arrested a priest on charges that he allowed a lawyer to use his Vatican bank account to commit insurance fraud.

Officials at the European Union in Brussels and agencies that monitor financial institutions say the Vatican has made significant strides in meeting norms against money-laundering, but that it still has some way to go.

Some in the Vatican are eager for change, but "you should not underestimate the resistance on issues of transparency" from tradition-bound forces, the European official said.

Under Benedict, the Vatican bank pledged to join the so-called white list of countries that meet international banking standards. In one of his final acts as pope, Benedict appointed a German aristocrat, Ernst von Freyberg, as the bank's new president.

The appointment loosened the historic grip on Vatican finances by a small and tight-knit group of Italian insiders, some of whom had fiercely resisted efforts to come under outside scrutiny. They were protective of the bank as an essentially Italian institution, which critics said was perilously close to the country's scandal-prone political and financial establishment.

Last May, the Vatican bank ousted its president, Ettore Gotti Tedeschi, a well-connected Italian banker, in a rare boardroom coup, accusing him in a public statement of incompetence. Mr. Gotti Tedeschi had come under intense scrutiny in 2010, when magistrates in Rome impounded $30 million from two external accounts used by the Vatican bank and placed him and the bank's director general, Paolo Cipriani, under investigation on charges related to money laundering. Both denied the charges.

The money was later restored to the Vatican bank, known as the Institute for Works of Religion, after the Vatican created its own Financial Intelligence Authority with a papal edict issued by Benedict in December 2010 to meet European anti-money-laundering directives.

The continuing Rome investigation is the first into the bank since the early 1980s, when Italy's Banco Ambrosiano, in which the Vatican had investments, collapsed after the disappearance of $1.3 billion in loans to companies in Latin America. Its chairman was found dead in 1982, hanging from Blackfriars Bridge in London. The Vatican bank denied wrongdoing but paid $250 million to Banco Ambrosiano's creditors.

In recent years, the Vatican has made progress but continues to lag in meeting international banking standards. Last July, a report by Moneyval, a monitoring agency under the Council of Europe, said that in the two years since it was created, the Vatican's new Financial Intelligence Authority had flagged only two suspicious transactions.

Last October, the Vatican appointed a new head of the authority, René Bruelhart, a 40-year-old Swiss lawyer who had helped take Liechtenstein, famous for its banking secrecy, off the black list of countries that do not comply with banking standards. Mr. Bruelhart's appointment, like that of Mr. von Freyberg, raised hopes of those seeking greater transparency and to open up a tradition-bound financial apparatus long dominated by Italians.

Further outside pressure on the Vatican to mend its secretive ways has come from the European Commission, the Brussels-based executive arm of the 27-nation European Union, and from rule changes brought about by the introduction of the euro in 1999.

In December 2000, the Vatican signed a monetary agreement in order to use the euro in its tiny territory and to issue coins bearing the marking Città del Vaticano as well as commemorative coins, which it sells at considerable markup to tourists and others.

But the agreement, to the dismay of officials in Brussels, included none of the commitments made by most other euro-using countries to combat money laundering. The European Commission demanded that the accord be revised.

Eventually, the Vatican signed a new deal with Brussels in December 2009, which included an unprecedented restriction on the Vatican's autonomy: a commitment to accept the jurisdiction of the Luxembourg-based European Union Court of Justice in settling disputes over the monetary deal with Europe.

"This was a big novelty, a historic step," the European official said. "For the first time in history the Vatican recognized a superior authority that is not God."

Last June, Mr. Cipriani, the bank's director general, told reporters on a rare tour of the Vatican bank that it had originally signed on to money-laundering standards monitored by Moneyval in order to continue issuing euro coins.

"We couldn't print coins with the Holy Father's image, that's why we're working on all this," he said, standing beneath a frescoed ceiling depicting "Mother Church" and answering questions submitted in advance. Security guards in dark suits stood silently on the sidelines.

The Vatican was "fully committed to the line of transparency," he said, adding, "We need to take away the veil, the shadow" that had fallen over the bank.

But the shadow grew longer. On Jan. 1, the Bank of Italy, which has placed the Vatican bank under intense scrutiny, blocked Deutsche Bank Italy from operating financial services at the Vatican, including the use of credit cards at its museums, after the Vatican failed to meet a Dec. 31 compliance deadline. The Vatican contested the move.Last month, the Vatican announced that it had found a consortium in Switzerland, which does not belong to the European Union, as a replacement.

The fact that the Vatican chose a Swiss firm to manage financial services inside the Vatican "isn't a good, transparent sign," said Carlo Marroni, a Vatican expert with the Italian business daily Il Sole 24 Ore.

But he said there had been some change. "In the past they were certainly considered a fiscal paradise," Mr. Marroni said. Today, they have improved, but are still in a gray zone. "They did a bit more than the minimum, but it's still insufficient," he said. "They took only the steps that they couldn't not take."

Rachel Donadio reported from Vatican City, and Andrew Higgins from Brussels.

A version of this article appeared in print on March 10, 2013, on page A1 of the New York edition with the headline: Power Struggle On Reforming Vatican Bank.

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News In Public Eye, Shining Star of Myanmar Loses Luster

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In Public Eye, Shining Star of Myanmar Loses Luster
Mar 10th 2013, 00:20

YANGON, Myanmar — She endured years of house arrest and was steadfast as her political movement was decimated and her colleagues were tortured. But now, as the leader of Myanmar's opposition in Parliament, Daw Aung San Suu Kyi, the Nobel Peace laureate, is courting her former jailers.

Daw Aung San Suu Kyi, the leader of Myanmar's opposition in Parliament, at a news conference in Yangon last month.

Representatives of the National League for Democracy waited to enter its first congress in Yangon, Myanmar, on Friday.

With Myanmar sloughing off the legacy of five decades of brutal military dictatorship, the country is witnessing a political minuet between the army and Ms. Aung San Suu Kyi, the human rights champion turned politician who is fighting to keep her disorganized and fractious political party relevant — and her path to the presidency open.

To her critics, Ms. Aung San Suu Kyi's compromises are tarnishing her status as a near saint.

She has been quiet about the military's bloody campaign against an armed ethnic minority group and recently went so far as to say she was "very fond" of the military, rattling some of her extremely loyal party members.

The remarks were tied to the army's role in liberating the country from colonial rule, but the timing, coming as the military was pounding the rebels with airstrikes, rankled supporters who were under military rule for decades.

"To the outside world, nothing has really changed with her; she is Suu Kyi and all the beautiful things that go with it," said Josef Silverstein, an expert in Burmese politics and professor emeritus at Rutgers. But "she is essentially making herself irrelevant. We have not heard Suu Kyi talk as Suu Kyi."

Making the transition from dissident to politician was never going to be easy in an impoverished country perennially divided by ethnic conflict. The path from icon to leader, successfully navigated by Nelson Mandela of South Africa and few others, is fraught in a country like Myanmar, which fought a civil war in 1948 that lives on in ethnic insurgencies and allowed the military an outsize role that still continues.

The reverence for Ms. Aung San Suu Kyi inside Myanmar is difficult to overstate. Her sacrifices for her country are legend: she chose to stay in Myanmar even as her husband was dying abroad, fearing the military leaders who kept her under arrest would not allow her to return to her struggling nation. Her grace under duress helped win her the Nobel Peace Prize in 1991, which she was only able to pick up last year after the generals decided to begin a shift to democracy.

But the adulation for her has set a particularly high standard, and her stature has intimidated members of her party from challenging her views. Even party members say their National League for Democracy is in disarray — suffering from an array of problems including what one called a "leadership vacuum" in the middle ranks. The party is holding its first-ever national congress this weekend.

"Nobody dares to speak out in front of Daw Aung San Suu Kyi, and that is a very bad thing," said U Win Tin, a senior party member. "It's not out of fear; it's out of admiration."

Supporters note that Ms. Aung San Suu Kyi is making a careful calculation in allying with the former generals who run the country. The political reality is that the military still wields enormous power. The military and the ruling party formed by the military together control the vast majority of seats in Parliament, and the military retains extensive business interests.

"I don't like the army," said U Kyi Win, a former political prisoner who is now a delegate at the party congress. "But for the future of our country, we have to work with them. We cannot have democracy without the involvement of the military."

The changes in the country have been highly personalized, dependent on a good working relationship between the former general who runs the country, U Thein Sein, and Ms. Aung San Suu Kyi.

"I think she needs to be credited as a stabilizing force and as someone willing to view former adversaries as partners for the common good," said David Steinberg, an expert on Myanmar at Georgetown University.

Working with the military is more than a political calculus; it is also in her blood. Her father, Aung San, who was assassinated when she was 2 years old, was the founder of the modern Burmese Army.

Ms. Aung San Suu Kyi defends her current relationship with the military, saying that she wants to pursue "negotiated compromise" and that retribution will not serve the country well. She argues instead for "restorative justice" — addressing what ails the country instead of meting out punishment for the sins of the past.

But representatives of minority groups say that should not preclude her being more active in trying to achieve national unity. They have criticized her for refusing to spend at least some political capital to help solve the conflict between Kachin rebels and the Myanmar Army, even as it grew particularly bloody in December and January. Ms. Aung San Suu Kyi said in January it was not the purview of her committee in Parliament.

Some of her harshest critics say her refusal to take on the military establishment is all about politics, and her ambitions for higher office. "She's only thinking about becoming president of Burma," said Pu Zo Zam, a leading voice of the country's minority groups, using the name for the country preferred by many in the opposition. "She was a national hero for us. Now she's only talking on behalf of her party."

Party officials acknowledge that Ms. Aung San Suu Kyi needs the army's support to change a rule in the Constitution that bars anyone with a foreign spouse from becoming president. Her husband was British.

Ms. Aung San Suu Kyi, 67, said recently that she would be open to the job of the presidency "if that is what the people want." Many see the next elections, scheduled for 2015, as the last chance for her to run.

There appears to be consensus among analysts that she would have a very strong chance of winning: outside ethnic minority areas, her popularity still verges on adoration.

But some party officials are visibly uneasy when explaining the new approach to the military.

"It's truly very risky," said U Monywa Aung Shin, a top party official from central Myanmar. "The people and party members are asking many questions about her strategy."

Mr. Monywa Aung Shin said he mostly agrees with those who say the party has "no choice" but to seek accommodations with the army. But he spent 12 years in prison under military rule and winces when he talks about the "new strategy." He said he was only "75 percent sure" that it was the best way forward.

There are also some outright dissenters in the party.

Mr. Win Tin said the army should "admit what they have done in the past."

"I don't accept the army's leading role in politics," he said.

Myanmar's citizens are following the political maneuverings like spectators at a high-stakes chess match, one move at a time.

"Burmese politics is power politics," said Min Min Oo, a member of the National League for Democracy from western Myanmar. "The role of the military is essential."

The context for Ms. Aung San Suu Kyi today is that after years of persecution, her party is in disarray. Mr. Monywa Aung Shin called it a "laughingstock."

The party lacks talented managers, is rived by infighting and factionalism, and is nearly broke.

In recent months, the party has raised money for charitable causes from prominent businessmen who during the years of military rule were known as "cronies" because they helped implement the junta's projects in return for favors. The move raised concerns in part because Ms. Aung San Suu Kyi often talks about responsible investment.

But party officials say they are desperate.

"For the time being," Mr. Kyi Win said, "we need to accept help from anyone."

Wai Moe contributed reporting.

A version of this article appeared in print on March 10, 2013, on page A6 of the New York edition with the headline: In Public Eye, Shining Star Of Myanmar Loses Luster.

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News Venezuelan Election Set for April

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Venezuelan Election Set for April
Mar 9th 2013, 23:32

CARACAS, Venezuela — Venezuela will hold a special election on April 14 to choose a new president to complete the term of Hugo Chávez, the charismatic socialist who died last week after a battle with cancer.

The president of the National Electoral Council, Tibisay Lucena, made the announcement on Saturday, a day after foreign dignitaries attended Mr. Chávez's funeral. Mr. Chávez died Tuesday at age 58.

Before leaving the country in December for surgery in Cuba, Mr. Chávez named his vice president, Nicolás Maduro, as the man he wanted to carry on his revolution, and he urged his followers to support him as his party's candidate if a special election were needed. Mr. Maduro was sworn in as interim president on Friday after Mr. Chávez's funeral.

The opposition coalition has offered its slot to Henrique Capriles Radonski, a state governor who ran unsuccessfully against Mr. Chávez in October. Mr. Capriles was expected to make a statement later on Saturday.

The winner will serve the remainder of Mr. Chávez's current six-year term, which began in January.

Mr. Maduro is widely considered the favorite. He benefits from Mr. Chávez's political machine, including a strong voter turnout program, access to government resources, which Mr. Chávez used unabashedly in his campaigns, and an outpouring of sentiment after the death of the president, who was adored with a religious fervor by many of his millions of followers.

Mr. Capriles likes to say that he has a record of beating Mr. Chávez's vice presidents. In winning election as governor of Miranda State, he twice beat former vice presidents running against him, most recently in December.

Mr. Capriles on Friday harshly criticized the swearing in of Mr. Maduro as interim president, calling it unconstitutional.

"Nicolás, no one elected you president," he said at a news conference. "The people didn't vote for you, boy."

Mr. Capriles lost to Mr. Chávez by 11 percentage points in October but he received 6.5 million votes, far more than any opposition candidate had previously.

Venezuela has the world's largest estimated oil reserves, and it is the fourth-largest foreign oil supplier to the United States. Yet the two countries have had rocky relations. Mr. Chávez became an outspoken critic of American policies during the Bush administration, which tacitly supported a coup that briefly ousted Mr. Chávez in 2002. Since then, Mr. Chávez has routinely accused the United States of seeking to undermine him and end his socialist-inspired revolution.

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News Los Angeles Frets About Its Low Voter Turnout

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Los Angeles Frets About Its Low Voter Turnout
Mar 9th 2013, 18:30

Kevork Djansezian/Getty Images

Anna Donlin gave treats to her dogs Walnut and Pearl after casting her ballot at an elementary school in Los Angeles on Tuesday.

LOS ANGELES — The roughly $19 million spent in the 2013 mayoral primary here made it the most expensive on record. But that is not the number that has people agog. Just 21 percent of registered voters turned out for last week's election — the lowest rate for a primary without an incumbent since at least 1978.

The paltry showing has many here wringing their hands, wondering what has become of the city's residents. Is there no such thing as civic engagement in this sprawling metropolis? Are municipal elections really that boring, even as the city faces serious financial problems? After many here thought the stereotype of a vapid city was buried long ago, there is a renewed sense of a civic inferiority complex.

"I am in mourning," said Steve Soboroff, who ran for mayor in 2001 and received more votes than any of the candidates in Tuesday's election did. "The idea that it is socially acceptable not to vote, but people talk about where they get their shoes from, is shameful. I love L.A., and I am very proud of our city, but people here need to get a grip."

Much of the post-mortem over the primary, which sent two City Hall insiders to a May 21 runoff, has focused on the turnout. Newspaper editorials and blogs have called the numbers "pathetic," "embarrassing" and "stunning"; one columnist said they "redefined apathy."

Some have blamed lackluster candidates who did little to excite voters other than their closest supporters. Others attribute it to the timing: early March, when voters may have been fatigued just a few months after a presidential race. There is even some speculation that the weather, partly cloudy at 59 degrees, was chilly enough to keep some Angelenos at home.

Over all, 382,927 votes were cast in the election, according to the city clerk, although the number could change slightly when the votes are officially certified. In 2001, the last time there was a mayoral primary with no incumbent, 511,521 voters cast a ballot, a turnout of 34 percent. In Chicago's mayoral primary in February 2011, some 42 percent of voters turned out and elected Rahm Emanuel.

It is not as if the city is facing an easy future or that the stakes are not high. Los Angeles has a projected deficit of $216 million, and many worry that the pensions promised to city workers could force the city into bankruptcy. A ballot initiative for a half-cent sales tax increase was rejected by 54 percent of the voters, although there was no financing to campaign against the increase. Most polls had projected that the measure would pass, with a higher turnout.

"Voters who turned out get it — they're cynical and are saying, 'We're tired of all the promises,' " said Austin Beutner, who was an early candidate for mayor but dropped out when his campaign failed to generate enough interest. "Los Angeles sometimes lacks a unifying theme or identity, but as a community we need to rebuild that identity. The clear winner here was none of the above."

The total number of ballots cast is actually an increase from the last mayoral election, in 2009, when turnout was just 18 percent. But at that time, Mayor Antonio R. Villaraigosa was running for re-election in a field of mostly unknown challengers.

The 2013 race was highly contested. Television was brimming with campaign commercials, and there were some 40 debates among the top five candidates. But there were few policy differences among the candidates, and much of the campaign centered on their personal backgrounds. The campaigns turned particularly nasty in the final days before the primary, which may also have prompted voters to stay home.

The top two finishers in the primary were Wendy Greuel, the city controller, and Eric Garcetti, a city councilman who represents Hollywood.

"I think this shows people are generally frustrated," Ms. Greuel said in an interview. "Part of running is to try to change that. It is incumbent on us to create a vision and a sense of opportunity here."

Many argue that the state should move the general election to November, which would also save some of the $17 million the city is expected to spend on the elections this year. If she is elected, Ms. Greuel said, she will push for such a change. Mr. Garcetti said he would consider doing so. Both expect the turnout to be higher in the May runoff.

"We need to start thinking as a single entity. We can't be an island unto ourselves," Mr. Garcetti said. "We don't have as deep of a sense of civic culture as we do in other cities, which is part of the reason I wanted to run."

"We can't make it hard for people to vote and then blame them for not doing so," said Derek Shearer, a professor of political science at Occidental College in Los Angeles, who in the 1980s worked to move Santa Monica's municipal elections to November. "Changing the date would mean more people are paying attention and would dramatically increase turnout."

There is one way to view the low turnout in a positive light. The highest turnout for municipal elections in recent history followed the riots in 1965 and 1992, said Fernando J. Guerra, the executive director of the Center for the Study of Los Angeles at Loyola Marymount University.

"If the choice is between a riot and low turnout, I think people choose the low turnout," Mr. Guerra said. "But this really shows that the city is more of an abstraction for people. Yes, you're an Angeleno, but first you are from Boyle Heights or Westchester or Chatsworth. People have to be reminded that we're one city."

A version of this article appeared in print on March 10, 2013, on page A23 of the New York edition with the headline: A Bit of Soul Searching in Los Angeles After Low Turnout for Mayoral Vote.

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