House passes $2 billion to replenish 'cash for clunkers' car purchase program

WASHINGTON (AP) — The House voted overwhelmingly Friday to rush $2 billion into the popular but financially strapped "cash for clunkers" car purchase program, heeding calls from consumers eager to keep taking advantage of thousands of dollars in trade-in incentives.

House members approved the measure 316-109 within hours of learning from Transportation Secretary Ray LaHood that the program was running out of money.

President Barack Obama said he was encouraged by the House action to keep alive a program that had "succeeded well beyond our expectations." Senate action is likely next week, ensuring the program won' be affected by the sudden shortage of cash.

Rep. Steve Israel, D-N.Y., said of the program: "This is a test drive, and people bought it big time."

Called the Car Allowance Rebate System, or CARS, the program is designed to help the economy and the environment by spurring new car sales. Car owners can receive federal subsidies of up to $4,500 for trading in their old cars for new ones that achieve significantly higher gas mileage.

House Majority Leader Steny Hoyer said the new money for the program would come from funds approved earlier in the year as part of an economic stimulus bill.

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Limit those bonuses, House votes, in measure aimed at restraining risky Wall Street behavior

WASHINGTON (AP) — Bowing to populist anger, the House voted Friday to prohibit pay and bonus packages that encourage bankers and traders to take risks so big they could bring down the entire economy.

Passage of the bill on a 237-185 vote followed the disclosure a day earlier that nine of the nation's biggest banks, which are receiving billions of dollars in federal bailout aid, paid individual bonuses of $1 million or more to nearly 5,000 employees.

"This is not the government taking over the corporate sector," Rep. Melvin Watt, D-N.C, said of the House action. "It is a statement by the American people that it is time for us to straighten up the ship."

Aware of voter outrage about the bonuses, Republicans were reluctant in Friday's debate to push back, even though they voted overwhelmingly against the bill. They said severe restrictions should apply only to banks that accept government aid. The legislation's ban on risky compensation would apply to any firm with more than $1 billion in assets, including bank holding companies, broker-dealers, credit unions, investment advisers and mortgage buyers Fannie Mae and Freddie Mac.

The White House and Senate Democrats haven't endorsed the measure, leaving its prospects uncertain. The Senate Banking Committee planned to take up the proposal in the fall as part of a broader bill overhauling financial regulations.

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House panel poised to act on health care as Dems seek to limit increases in cost of insurance

WASHINGTON (AP) — Democrats sought to limit increases in the cost of insurance sold under a sweeping health care bill Friday as they labored to clear the final obstacle to a September showdown on President Barack Obama's top domestic priority.

Several officials said a last-minute agreement among Democrats on the Energy and Commerce Committee also included authority for the federal government to negotiate directly with pharmaceutical companies for lower drug prices under Medicare.

The changes were part of an intensive effort Democrats have made in recent days to satisfy the conflicting demands of liberals and conservatives on the panel. "We have agreed we need to pull together," said Rep. Henry Waxman, D-Calif., the committee chairman. He said he hoped for a vote by early evening.

Several officials said the cost of insurance to be sold widely under the bill could not rise by more than 4 percent a year unless the government approved.

The officials who disclosed the terms of the last-minute agreement did so on condition of anonymity, saying they were not authorized to discuss private deliberations.

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Philippine democracy icon, former President Corazon Aquino, dead at 76

MANILA, Philippines (AP) — Former President Corazon Aquino, who swept away a dictator with a "people power" revolt and then sustained democracy by fighting off seven coup attempts in six years, died on Saturday, her son said. She was 76.

The uprising she led in 1986 ended the repressive 20-year regime of Ferdinand Marcos and inspired nonviolent protests across the globe, including those that ended Communist rule in eastern Europe.

But she struggled in office to meet high public expectations. Her land redistribution program fell short of ending economic domination by the landed elite, including her own family. Her leadership, especially in social and economic reform, was often indecisive, leaving many of her closest allies disillusioned by the end of her term.

Still, the bespectacled, smiling woman in her trademark yellow dress remained beloved in the Philippines, where she was affectionately referred to as "Tita (Auntie) Cory."

"She was headstrong and single-minded in one goal, and that was to remove all vestiges of an entrenched dictatorship," Raul C. Pangalangan, former dean of the Law School at the University of the Philippines, said in 2009. "We all owe her in a big way."

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Wave of blasts in Iraq kills 29 near Shiite mosques in apparently coordinated attacks

BAGHDAD (AP) — A string of bombings targeted Shiite worshippers in the Baghdad area during Friday prayers, killing at least 29 people in an apparently coordinated attack against followers of an anti-U.S. cleric who were blamed for some of Iraq's worst sectarian violence.

The blasts shattered a recent calm and underscored warnings that suspected Sunni insurgents would step up efforts to stoke sectarian violence as the Americans draw down their forces. Despite the violence, July remained one of the calmest months for Iraqis and the least deadly for American forces.

The largest blast was a car bombing near the al-Shoroufi mosque that killed at least 24 people and wounded nearly 30 in the northern neighborhood of Shaab, a former stronghold of the militia led by Muqtada al-Sadr, whose forces were accused of being behind sectarian bloodshed and were routed last year in a U.S.-backed government offensive.

The mosque was seized by Iraqi security forces more than a year ago and has been used as a base after explosives and ammunition were found inside. But worshippers continued to hold weekly Friday prayer services on the street outside. Bloodied prayer rugs and sandals covered the area after the explosion.

Odai Khalil, a 25-year-old mechanic who witnessed the blast, said the explosives were packed inside a taxi at a nearby parking lot.

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Veterans of America's latest wars prepare for classes under education benefits of new GI Bill

WASHINGTON (AP) — Spc. Marco Reininger started the year on the dusty streets of Afghanistan. He'll end it on the campus of Columbia University with the government picking up a large chunk of the $100,000 tab for tuition.

The Post-9/11 GI Bill rolls out on Saturday, just in time for the fall semester for veterans of the recent wars. Reminiscent of the GI education benefits signed into law by President Franklin D. Roosevelt two weeks after D-Day in 1944, the measure is aimed at transforming the lives of a new generation of veterans.

President Barack Obama on Monday will attend a rally at George Mason University in Fairfax, Va., in celebration.

In the next decade, $78 billion is expected to be paid out under the new GI Bill, which is the most comprehensive education benefit offered since World War II.

Many veterans who served after the Sept. 11 terrorist attacks are eligible for full tuition and fees for four years at a state university, a monthly housing stipend and up to $1,000 annually for books. Among those covered are members of the Guard and Reserve who spent three months or more activated for war service, giving them vastly improved benefits.

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Shuttle Endeavour, 7 astronauts return; Japanese spaceman swamped with sushi after months away

CAPE CANAVERAL, Fla. (AP) — Space shuttle Endeavour and its seven astronauts returned to Earth on Friday, completing a long but successful construction job that boosted the size and power of the international space station.

They ended up swamped with sushi.

Endeavour's smooth and punctual arrival, after more than two weeks in orbit, set off a steady stream of congratulations and an ecstatic welcoming reception for Koichi Wakata, the first Japanese astronaut to return from a long space journey. His station mission lasted 4 1/2 months.

At his request, sushi awaited him. But it was more than Wakata had anticipated. He was overloaded with sushi as Kennedy Space Center workers dropped off the delicacy at crew quarters.

Looking remarkably fit for someone still getting used to gravity, Wakata said four hours after touchdown that he had yet to eat any sushi because of all the medical testing. But he was going to splurge as soon as the crew news conference ended.

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Stocks cap an enormous July run with a mixed finish as economy shrinks at a slower pace

NEW YORK (AP) — The stock market's best July in 20 years is giving investors reason for hope about the economy.

Investors are placing big bets that the ability of companies to squeeze out surprise profits means the longest recession since World War II is finally easing its grip. But even as earnings and some economic reports suggest the economy is strengthening, the stock rally means investors will pay a bigger price if they are wrong.

The Dow surged 8.6 percent for the month, with most of the gains arriving in bursts in the final 15 days. The extraordinary run shaped July into the best month for the blue chips since October 2002 and the best July since 1989.

The broader Standard & Poor's 500 index, a benchmark for many mutual funds, also ran at a strong pace and July was its best performance since 1997. Even with the gains, the S&P is still down 37 percent from its peak in October 2007.

The companies that fared best in July were those that signaled they were patching up their businesses after a terrible winter and fall. Caterpillar Inc.'s earnings for the April-June quarter fell but the company raised its profit forecast for the year. Its stock surged 33.4 percent for the month.

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Michael Jackson's personal physician was in deep financial trouble before he got hired

LOS ANGELES (AP) — Dr. Conrad Murray was in dire financial shape when he signed on as Michael Jackson's personal physician earlier this year at $150,000 a month.

The Las Vegas cardiologist owed a total of at least $780,000 in judgments against him and his medical practice, outstanding mortgage payments on his house, delinquent student loans, child support and credit cards.

Court records chronicling Murray's woes in Las Vegas, where authorities searched his home this week as part of a manslaughter investigation into Jackson's death, might help explain why — beyond the chance to get close to a celebrity — Murray seized the chance to keep the pop star healthy through a series of concerts in London.

But more than that, the financial pressures on Murray could help prosecutors establish a motive if he ends up facing charges.

"Here he is, dealing with one of the most famous people in the world. There may have been a great deal of pressure to do what Michael Jackson wanted, give him the drugs he wanted, treat him the way Michael Jackson wanted to be treated, even if it wasn't in keeping with medical protocol," said Steve Cron, a criminal defense attorney and adjunct professor at Pepperdine University's law school.

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White Sox acquire injured Padres ace Jake Peavy in return for 4 young pitchers at deadline

CHICAGO (AP) — Jake Peavy has finally agreed to pitch for the Chicago White Sox.

The San Diego Padres traded their ace to the White Sox on Friday shortly before the deadline for making deals without waivers.

The Padres got four young pitchers for Peavy — Clayton Richard, Aaron Poreda, Dexter Carter and Adam Russell.

In May, Padres and White Sox agreed to a deal for Peavy, but the 2007 NL Cy Young winner turned it down. But this time, Peavy agreed to waive his no-trade clause and joined the AL Central contenders.