Hollywood directs its star power toward a campaign closer to home

A stylish crowd waited beneath a flashing marquee outside the Fonda Theatre. "Appearing tonight!" the sign read. "Eric Garcetti 4 Mayor."

In a city where political campaigns are typically waged at neighborhood meetings, not Hollywood concert halls, last week's star-studded fundraiser for Garcetti highlighted the entertainment industry's outsized role in this year's mayoral race. Talk show host Jimmy Kimmel started the show with a stand-up routine and musician Moby got the crowd of several hundred dancing. Actress Amy Smart urged everyone to tweet about the campaign, and actor Will Ferrell beamed in via video to pledge that if Garcetti is elected, every resident in the city will receive free waffles.

Hollywood is taking to City Hall politics like never before, veterans say, with power players such as Steven Spielberg leading a major fundraising effort and celebrities such as Salma Hayek weighing in via YouTube. A Times analysis of city Ethics Commission records found that actors, producers, directors and others in the industry have donated more than $746,000 directly to candidates, with some $462,000 going to Garcetti and $226,000 to City Controller Wendy Greuel.

Several of Greuel's big-name celebrity supporters, including Tobey Maguire, Kate Hudson and Zooey Deschanel, recently hosted a fundraiser for her at an exclusive club on the Sunset Strip. She is getting extra help from Spielberg and his former partners at DreamWorks, Jeffrey Katzenberg and David Geffen, who have given at least $150,000 and are raising more for an independent group funding a TV ad blitz on her behalf.

The burst of support is coming from an industry often maligned for paying little attention to local politics.

While Mayor Antonio Villaraigosa is often photographed at red carpet events and former Mayor Tom Bradley was famously close to actor Gregory Peck, serious Hollywood money and star power has tended to remain tantalizingly out of reach for local politicians. "It's no secret that the entertainment industry has never really focused on the city that houses it," said Steve Soboroff, who ran for mayor and lost in 2001.

Political consultant Garry South, who has worked on mayoral and gubernatorial campaigns, recalled having to pay celebrities to appear at fundraisers in the past. Hollywood has long embraced candidates in presidential and congressional elections, South said, in part because they have more influence over causes favored by celebrities.

"The mayor of L.A. is not going to get us out of Afghanistan. The mayor of L.A. is not going to determine whether or not gay marriage is legal," South said. "The local issues are just not as sexy."

But this year, if you're a part of the Hollywood establishment, chances are you've gotten invitations to fundraisers for Greuel, Garcetti or both.

The difference this time is that both candidates have worked to cultivate deep Hollywood connections, observers say. Garcetti has represented Hollywood for 12 years, overseeing a development boom and presiding over ceremonies to add stars — Kimmel recently got one — on the Hollywood Walk of Fame. Greuel is a former executive at DreamWorks, where she worked with the moguls who founded the studio. She has also served for 10 years on the board of the California Film Commission.

City Councilwoman Jan Perry and entertainment attorney Kevin James have reaped far less financial support from the industry, records show, although each claims a share of celebrity endorsements. Dick Van Dyke sponsored a fundraiser for Perry and Oscar winner Dustin Lance Black has given to James.

Agent Feroz Taj, who attended Garcetti's Moby concert, said a flurry of activity around the race, involving friends and colleagues, piqued his interest. He said he's never been involved in a political campaign, but now when he receives invites to Greuel events, he says he is supporting Garcetti.

Industry insiders have been buzzing about a letter they say is being circulated by an advisor to Spielberg and Katzenberg, urging people to give $15,000 to an independent group supporting Greuel. The DreamWorks founders have made a difference for Greuel in previous elections. In 2002, financial support from the studio executives and their allies helped her squeak out a victory in one of the closest City Council races in history.

This time around, billionaire media mogul Haim Saban is getting involved, providing his Beverly Hills estate for a Greuel fundraiser featuring U.S. Sen. Barbara Boxer (D-Calif.). Greuel has also received contributions from Tom Hanks and actresses Mariska Hargitay and Eva Longoria, neither of whom have given to a local political campaign before, according to records.

Garcetti, on the other hand, has picked up contributions from former Disney Chief Executive Michael Eisner, as well as newcomers to local politics Jake Gyllenhaal and Hayek, who once traveled with Garcetti on a global warming awareness mission to the South Pole. The actress released a video endorsing Garcetti and thanking him for helping her find her wallet in the snow.

Campaign consultant Sean Clegg linked the industry's burgeoning interest in mayoral politics to President Obama's election, which he said had "a catalyzing effect on Hollywood." Indeed, many Greuel and Garcetti supporters were Obama backers. Hayek hosted a fundraiser for Obama and Longoria served as a co-chair of his reelection campaign.

Clegg is a consultant for Working Californians, an independent campaign committee that hopes to raise and spend at least $2 million supporting Greuel, with donations from Spielberg and others in Hollywood, as well as the union representing Department of Water and Power employees.

Generally, Clegg argued, Hollywood money is different than the special-interest funding campaigns collect. "Money is coming out of the entertainment industry more on belief and less on the transactional considerations," he said.

But Raphael Sonenshein, director of the Pat Brown Institute of Public Affairs at Cal State L.A., said Hollywood's new interest in local elections may be tied to growing concerns about film production being lured elsewhere by tax incentives.

Garcetti and Greuel have both pledged to reverse job losses tied to runaway television and film production, with Garcetti touting a recent proposal to eliminate roughly $231,000 in annual city fees charged for pilot episodes of new TV shows. The number of pilots shot locally has dropped 30% in recent years, but city budget analysts say the tax break would have a minimal effect because city fees represent only a small portion of production costs.

On the council, both candidates voted to eliminate filming fees at most city facilities. Greuel tells audiences she has an insider's perspective on the industry's needs and says she will create an "entertainment cabinet" to help it thrive. "I have sat with studio heads," she said in a recent interview. "They want a city . . . that is a champion for film industry jobs in Los Angeles."

Greuel may have Garcetti beat on experience in the studio front office, but he is the only candidate with his own page on IMDb.com — a closely watched industry website that tracks individuals' film and television credits.

The councilman, a member of the Screen Actors Guild, has made several television appearances, including one for the cable police drama "The Closer." He played the mayor of Los Angeles.

kate.linthicum@latimes.com

Times staff writer Maloy Moore contributed to this report.

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Russians Seek Clues and Count Blessings After Meteor Blast

CHEBARKUL, Russia —After a brilliant flash illuminated the sky on Friday morning like a second sun, Alyona V. Borchininova and several others in this run-down little town in the rust belt of western Siberian wandered outside, confused and curious.

They followed the light’s path to the town’s lakefront, where they trudged for about a mile over the open ice until they came to a startling sight: a perfectly round hole in the ice, about 20 feet in diameter, its rim glossy with fresh ice that had crusted on top of the snow.

“It was eerie,” Ms. Borchininova, a barmaid, said Saturday. “So we stood there. And then somebody joked, ‘Now the green men will crawl out and say hello.’ ”

Russians are still coming to terms with what NASA scientists say was a 7,000-ton chunk of space rock that came hurtling out of the sky at 40,000 miles an hour, exploding over the Ural Mountains, spraying debris for miles around and, amazingly, killing no one.

As the Russian government pursued the scientific mysteries of Friday’s exploding meteor by sending divers into the inky waters of the hole in Lake Chebarkul on Saturday, residents reacted with a kind of giddy relief and humor over their luck at having survived a cosmic near miss.

NASA estimates that when the meteor entered the atmosphere over Alaska, it weighed 7,000 to 10,000 tons and was at least 50 feet in diameter, a size that strikes the Earth about once every hundred years. They said it had exploded with the force of 500 kilotons of TNT.

The shock wave injured hundreds of people about 54 miles away in the industrial city of Chelyabinsk, most from broken glass; collapsed a wall in a zinc factory; set off car alarms; and sent dishes flying in thousands of apartments. Broken windows exposed people and pipes to the Siberian winter; many residents focused Saturday on boarding windows and draining pipes, to preserve heating systems.

If pieces of meteorite reached the surface, as NASA said was likely, they fell largely into the sea of birch and pine trees of Siberia, now blanketed in snow.

Lake Chebarkul is one of four sites the government believes to felt a significant impact, the minister of emergency situations, Vladimir Pushkov, told Interfax.

As the sun rose Saturday, the snow crystals sparkling in the sun like a million tiny mirrors, steam wafted from the site, apparently related to the work of divers, but the lake yielded little to shed light on the mystery.

Mr. Pushkov later said divers found nothing on the lake bed, but did not rule out meteor shrapnel as the cause of the hole.

“Experts are studying all possible places of impact,” he said. “We have no reports of confirmed discoveries.”

The discovery of a confirmed fragment could help scientists better apprehend the composition of the meteor, perhaps shedding light on how close it was to descending further before exploding from the heat, or of hitting the surface, potentially causing vastly more casualties in this region of military and industrial towns, a major nuclear research site and waste repository and other delicate infrastructure.

In Chelyabinsk, the worst hit town, most who had sought medical attention were released from hospitals by Saturday, the Ministry of Health reported. A total of 1,158 people, including 298 children, asked for medical assistance. Of these 52 people were hospitalized. By Saturday afternoon, 12 adults and three children remained in hospitals.

Health officials evacuated to Moscow a woman who broke two vertebrae after falling down a flight of stairs. One man’s finger was cut off by broken glass.

Overshadowing these misfortunes, a fourth-grade teacher in Chelyabinsk, Yulia Karbysheva, was being hailed as a hero for saving 44 children from glass cuts by ordering them to crawl under their desks after she saw the flash. Having no idea what it was, she executed a cold war-era duck-and-cover drill, with salutary results.

Ms. Karbysheva, who remained standing, was seriously lacerated by glass that severed a tendon in her arm, Interfax reported; not one of her students suffered a cut.

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The Bachelor: Sean's Hometown Date with Desiree Gets Interrupted - By an Ex?

The ex who pops back into the picture has been a common storyline in recent seasons of The Bachelor. And this season is no exception.

In this exclusive preview of Monday night's episode, Sean Lowe meets more of Desiree Hartsock's loved ones than he bargained for.

"As Des and I are getting dinner ready for her parents, I feel like we're a couple," says Sean. "And I'm excited for her family to get here because I want to meet these people."

Instead, the ex shows up at the door, asking if he and Des can talk. An awkward, you've-got-to-wonder-if-it's-scripted dialogue ensues. A sampling:

Ex: Des, I love you, OK?

Sean: Whoa.

Ex: I've been texting, calling, where they hell have you been?

Des: [Gestures toward Sean] "I've been busy.

Ex: We're together for two years and all of a sudden, just nothing? I love you more than anything.

Sean: I'm thinking, 'Maybe I just need to leave.'

Ex: You're going to be with this actor? This isn't real.

Sean: First of all, I'm standing right here. You want to talk to me, talk to me ... [To Des]: Do you want to talk to him? [To Ex]: Then leave please.

Ex: Can you give us a minute?

Sean: Don't put your hands on me …

The fireworks air on the new episode of The Bachelor Monday at 8 p.m. ET on ABC.

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UN warns risk of hepatitis E in S. Sudan grows

GENEVA (AP) — The United Nations says an outbreak of hepatitis E has killed 111 refugees in camps in South Sudan since July, and has become endemic in the region.

U.N. refugee agency spokesman Adrian Edwards says the influx of people to the camps from neighboring Sudan is believed to be one of the factors in the rapid spread of the contagious, life-threatening inflammatory viral disease of the liver.

Edwards said Friday that the camps have been hit by 6,017 cases of hepatitis E, which is spread through contaminated food and water.

He says the largest number of cases and suspected cases is in the Yusuf Batil camp in Upper Nile state, which houses 37,229 refugees fleeing fighting between rebels and the Sudanese government.

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San Bernardino County sheriff details final shootout with Dorner

Fugitive Christopher Dorner spent his final hours barricaded inside a mountain cabin armed with a high-powered sniper rifle, smoke bombs and a cache of ammo, shooting to kill and ignoring commands to surrender until a single gunshot ended his life, authorities said Friday.

The evidence indicates that Dorner, a fired Los Angeles police officer suspected of killing four people and wounding three others, held a gun to his head and fired while the Big Bear area cabin he was holed up in caught fire, ignited by police tear gas.

San Bernardino County Sheriff John McMahon, during a news conference Friday, offered the most detailed account yet of the manhunt and final shootout, which left one of his deputies dead and another seriously wounded. McMahon steadfastly defended the tactics used by his agency, dismissing assertions that deputies may have botched the hunt for Dorner or deliberately set the cabin on fire.

"We stand confident in our actions on that fateful day," he said. "The bottom line is the deputy sheriffs of this department, and the law enforcement officers from the surrounding area, did an outstanding job. They ran into the line of fire. They were being shot at, and didn't turn around in retreat."

During Tuesday's shootout, a television news crew recorded law enforcement officials shouting to burn the cabin down. McMahon acknowledged the comments were made, but said they did not come from the department's tactical team or commanders on the scene.

"They had just been involved in probably one most of the most fierce firefights," he said of the people heard on the recording. "And sometimes, because we're humans, we say things that may or may not be appropriate. We will look into this and we will deal it appropriately."

The blaze started shortly after police fired "pyrotechnic" tear gas into the cabin; the canisters are known as "burners" because the intense heat they emit often causes a fire.

Sheriff's Capt. Gregg Herbert, who led the assault on the cabin, said the canisters were used only as a last resort after Dorner continued firing at deputies, ignored commands to surrender and did not respond when "cold," less intense tear gas was shot into the wood-framed dwelling.

Herbert said that a tractor was deployed to tear down walls of the cabin to expose Dorner's whereabouts inside, but that Dorner set off smoke bombs to hide himself. Storming the cabin was considered too dangerous because of the belief that Dorner "was lying in wait for us," he said.

"This was our only option," Herbert said of the pyrotechnic tear gas, adding that the potential for igniting a fire was taken into account.

After about a quarter of the cabin was engulfed in flames, Herbert said, "we heard a distinct single gunshot" come from inside. The shot sounded different from those Dorner had fired at deputies, indicating a different type of weapon was used, he said.

Dental records were used to confirm that the remains found in the cabin were indeed those of Dorner, 33.

The Riverside County coroner's office conducted an autopsy on Dorner, and determined that his death was caused by a single gunshot to the head. The coroner has not positively determined that Dorner shot himself, but the evidence "seems to indicate that the wound … was self inflicted," said Capt. Kevin Lacy of the San Bernardino County coroner's division.

From the cabin and vehicles Dorner used in the San Bernardino Mountains, investigators recovered a cache of weapons and ammunition. Among them: numerous assault weapons — including a bolt-action .308 caliber sniper's rifle — silencers, handguns, high-capacity magazines, smoke bombs, tear gas and a military-style Kevlar helmet.

McMahon said it was unclear how Dorner was able to carry all those weapons while on foot and on the run in Big Bear. But he said there's no evidence Dorner had an accomplice or received aid from anyone.

During Friday's news conference, McMahon also was pressed to address the anger and frustration of Big Bear residents who questioned how Dorner was able to hide out undetected for five days. In fact, Dorner was hiding in a vacation rental condominium less than 200 yards from law enforcement's command center during the manhunt.

The sheriff said the condo had been checked early in the search. The door was locked and no one answered when deputies knocked. Since there was no sign of forced entry on the door or windows, the deputies moved on.

McMahon said the decision was made not to kick open doors of unoccupied homes because they had no search warrants, and doing so would have included "hundreds" of homes — since many of the cabins and homes are unoccupied vacation homes.

Investigators later learned that the owners of the condo, Jim and Karen Reynolds, had left the unit unlocked to allow workers inside. When the Reynoldses entered the condo Tuesday morning, Dorner tied them up and stole their car. One of them was able to break free and call 911, leading to the deadly standoff at the mountain cabin in Angelus Oaks.

"I don't believe we made any mistakes," McMahon said.

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India Ink: Image of the Day: Feb. 15

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Gretchen Rossi: Is She Wearing an Engagement Ring?

TV Watch
Buzz

By Dahvi Shira and Michele Stueven

02/15/2013 at 12:40 PM EST

Gretchen Rossi and Slade Smiley

FayesVision/WENN

Slade Smiley hasn't put a ring on it – yet.

The reality TV personality's longtime girlfriend, Real Housewives of Orange County star Gretchen Rossi, was spotted at Heather McDonald's book launch at Hollywood's Emerson Theater on Wednesday night, sporting some bling on her engagement finger.

But apparently Smiley hasn't popped the question.

"The ring was not from Slade," a source tells PEOPLE, while a second source says when asked about the ring at the event, "Slade danced around the question."

About two years ago, Rossi, 34, told PEOPLE she was in no rush to head to the altar with Smiley.

"When I first got married, I thought I was going to be married for life," she said. "I thought that was it and it was really hard to fail at that marriage."

But now, although the ring wasn't from him, the first source tells PEOPLE, "They're planning on getting engaged pretty soon."

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Study: Fish in drug-tainted water suffer reaction

BOSTON (AP) — What happens to fish that swim in waters tainted by traces of drugs that people take? When it's an anti-anxiety drug, they become hyper, anti-social and aggressive, a study found. They even get the munchies.

It may sound funny, but it could threaten the fish population and upset the delicate dynamics of the marine environment, scientists say.

The findings, published online Thursday in the journal Science, add to the mounting evidence that minuscule amounts of medicines in rivers and streams can alter the biology and behavior of fish and other marine animals.

"I think people are starting to understand that pharmaceuticals are environmental contaminants," said Dana Kolpin, a researcher for the U.S. Geological Survey who is familiar with the study.

Calling their results alarming, the Swedish researchers who did the study suspect the little drugged fish could become easier targets for bigger fish because they are more likely to venture alone into unfamiliar places.

"We know that in a predator-prey relation, increased boldness and activity combined with decreased sociality ... means you're going to be somebody's lunch quite soon," said Gregory Moller, a toxicologist at the University of Idaho and Washington State University. "It removes the natural balance."

Researchers around the world have been taking a close look at the effects of pharmaceuticals in extremely low concentrations, measured in parts per billion. Such drugs have turned up in waterways in Europe, the U.S. and elsewhere over the past decade.

They come mostly from humans and farm animals; the drugs pass through their bodies in unmetabolized form. These drug traces are then piped to water treatment plants, which are not designed to remove them from the cleaned water that flows back into streams and rivers.

The Associated Press first reported in 2008 that the drinking water of at least 51 million Americans carries low concentrations of many common drugs. The findings were based on questionnaires sent to water utilities, which reported the presence of antibiotics, sedatives, sex hormones and other drugs.

The news reports led to congressional hearings and legislation, more water testing and more public disclosure. To this day, though, there are no mandatory U.S. limits on pharmaceuticals in waterways.

The research team at Sweden's Umea University used minute concentrations of 2 parts per billion of the anti-anxiety drug oxazepam, similar to concentrations found in real waters. The drug belongs to a widely used class of medicines known as benzodiazepines that includes Valium and Librium.

The team put young wild European perch into an aquarium, exposed them to these highly diluted drugs and then carefully measured feeding, schooling, movement and hiding behavior. They found that drug-exposed fish moved more, fed more aggressively, hid less and tended to school less than unexposed fish. On average, the drugged fish were more than twice as active as the others, researcher Micael Jonsson said. The effects were more pronounced at higher drug concentrations.

"Our first thought is, this is like a person diagnosed with ADHD," said Jonsson, referring to attention deficit-hyperactivity disorder. "They become asocial and more active than they should be."

Tomas Brodin, another member of the research team, called the drug's environmental impact a global problem. "We find these concentrations or close to them all over the world, and it's quite possible or even probable that these behavioral effects are taking place as we speak," he said Thursday in Boston at the annual meeting of the American Association for the Advancement of Science.

Most previous research on trace drugs and marine life has focused on biological changes, such as male fish that take on female characteristics. However, a 2009 study found that tiny concentrations of antidepressants made fathead minnows more vulnerable to predators.

It is not clear exactly how long-term drug exposure, beyond the seven days in this study, would affect real fish in real rivers and streams. The Swedish researchers argue that the drug-induced changes could jeopardize populations of this sport and commercial fish, which lives in both fresh and brackish water.

Water toxins specialist Anne McElroy of Stony Brook University in New York agreed: "These lower chronic exposures that may alter things like animals' mating behavior or its ability to catch food or its ability to avoid being eaten — over time, that could really affect a population."

Another possibility, the researchers said, is that more aggressive feeding by the perch on zooplankton could reduce the numbers of these tiny creatures. Since zooplankton feed on algae, a drop in their numbers could allow algae to grow unchecked. That, in turn, could choke other marine life.

The Swedish team said it is highly unlikely people would be harmed by eating such drug-exposed fish. Jonsson said a person would have to eat 4 tons of perch to consume the equivalent of a single pill.

Researchers said more work is needed to develop better ways of removing drugs from water at treatment plants. They also said unused drugs should be brought to take-back programs where they exist, instead of being flushed down the toilet. And they called on pharmaceutical companies to work on "greener" drugs that degrade more easily.

Sandoz, one of three companies approved to sell oxazepam in the U.S., "shares society's desire to protect the environment and takes steps to minimize the environmental impact of its products over their life cycle," spokeswoman Julie Masow said in an emailed statement. She provided no details.

___

Online:

Overview of the drug: http://www.nlm.nih.gov/medlineplus/druginfo/meds/a682050.html

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Mayor who gambled away $1 billion had brain tumor

The lawyer for former San Diego Mayor Maureen O'Connor suggested that a brain tumor may have caused her to lose massive sums gambling on video poker games.

Over a nine-year period O'Connor wagered an estimated $1 billion,
including millions from a charity set up by her late husband, who
founded the Jack in the Box fast-food chain.

That was the portrait that emerged in court Thursday as the frail
former mayor tearfully acknowledged that she skimmed more than $2 million
from the charity founded by her late husband, Robert O. Peterson.

O'Connor, 66, admitted in a plea deal that she had a gambling addiction
and is nearly destitute. Her lawyer, prominent defense attorney Eugene
Iredale, suggested that a brain tumor may have impaired her reasoning.

Reporters were given copies of her brain scan from a 2011 surgery.

O'Connor's rapidly declining medical condition "renders it highly
improbable — if not impossible — that she could be brought to trial,"
according to court documents filed by federal prosecutors.

"This is a sad day for the city of San Diego," said Assistant U.S.
Atty. Phillip Halpern. "Maureen O'Connor was born and raised in this
town. She rose from humble origins.... She dedicated much of her life,
personal and professional, to improving this city."

The $1-billion gambling binge stretched from 2000 to 2009, according
to court documents. In 2008 and 2009, when the fortune she had inherited
was not enough, she began taking from the R.P. Foundation to cover her
losses.

Despite being ahead more than $1 billion at one point, O'Connor
"suffered even larger gambling losses," according to prosecutors. Her
net loss, Iredale said, was about $13 million.

She was considered such a high roller that Las Vegas casinos would
send a private jet to pick her up in San Diego. Records show that
O'Connor won $100,000 at the Barona casino in San Diego County, while at
roughly the same time she needed to cash a $100,000 check at the
Bellagio in Las Vegas.

Those who knew the former political doyenne said she had become a recluse, inscrutable even to those she counted as friends.

"I considered myself one of her closest friends, but I would call her
and she wouldn't return my call," said lawyer Louis Wolfsheimer. "I
didn't want anything from her, just to know how she was. But it looked
like she was becoming reclusive."

In a bargain with prosecutors, O'Connor agreed to repay $2,088,000 to
the R.P. Foundation, which supported charities such
as City of Hope, San Diego Hospice, and the Alzheimer's Assn. before it was driven into insolvency in 2009 by O'Connor's misappropriation of funds, prosecutors said.

"I never meant to hurt the city," an emotional O'Connor told
reporters gathered at a restaurant close to the federal courthouse. She
promised to repay the foundation but declined to answer questions.

Prosecutors agreed to defer prosecution for two years. If O'Connor
violates no further laws and makes restitution, the charge of making
illegal financial transactions may be dismissed. Under the agreement,
O'Connor acknowledged her guilt but was allowed to plead not guilty.

If convicted, O'Connor could have faced a maximum 10-year prison sentence and a fine of up to $250,000.

As part of her plea agreement, O'Connor agreed to settle "all tax
liability resulting from her receipt" of money from the foundation. She
also agreed to seek treatment for her gambling addiction.

Although she is currently without income or a bank account,
O'Connor's economic status could reverse if she wins a civil lawsuit
filed against a German bank involved in the 2005 purchase of a resort in
Mendocino County that O'Connor had acquired in 1998.

O'Connor sold the Heritage House for $19.5 million but has alleged
that she was the victim of fraud in the sale. A settlement or victory at
trial could provide the millions needed to pay restitution to the
foundation as well as the tax liabilities involved with the misallocation
of its funds.

"No figure, regardless of how much good they've done or how much
they've given to charity, can escape criminal liability with impunity,"
said U.S. Atty. Laura Duffy.

One of O'Connor's major worries, defense attorney Iredale said, "is fear of losing her reputation."

ALSO:

Man killed in Valentine's Day shooting in Maywood

Ex-mayor's lawyer ties her gambling addiction to brain tumor

Gusty winds blow through Southern California, advisory issued

-- Tony Perry in San Diego

Photo: Maureen O'Connor walks to court with her attorney, Eugene Iredale. If
O'Connor violates no further laws and makes restitution, the charge of
making illegal financial transactions may be dismissed.
Credit: Peggy Peattie / Associated Press

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Way of the World: Technology, Trade and Fewer Jobs

NEW YORK — President Barack Obama’s State of the Union speech this week confirmed it: The pre-eminent political and economic challenge in the industrialized democracies is how to make capitalism work for the middle class.

There is nothing mysterious about that. The most important fact about the United States in this century is that middle-class incomes are stagnating. The financial crisis has revealed an equally stark structural problem in much of Europe.

Even in a relatively prosperous age — for all of today’s woes, we have left behind the dark, satanic mills and workhouses of the 19th century — this decline of the middle class is more than an economic issue. It is also a political one. The main point of democracy is to deliver positive results for the majority.

All of which is why understanding what is happening to the middle class is urgently important. There is no better place to start than by talking to David Autor, an economics professor at the Massachusetts Institute of Technology. Mr. Autor is one of the leading students of the most striking trend bedeviling the middle class: the polarization of the job market. That is a nice way of saying the economy is being cleaved into high-paying jobs at the top and low-paying jobs at the bottom, while the middle-skill and middle-wage jobs that used to form society’s backbone are being hollowed out.

But when I asked him this week what had gone wrong for the U.S. middle class, he gave a different answer: “The main problem is we’ve just had a decade of incredibly anemic employment growth. All of a sudden, around 2000 and 2001, things just slowed down.”

Academics can usually be counted on to have a confident explanation for everything. That is why I was surprised and impressed by Mr. Autor’s answer when I asked him where the jobs had gone. “No one really understands why that is the case,” he said.

It was a winningly modest reply. But work by Mr. Autor and two colleagues — David Dorn, a visiting professor at Harvard, and Gordon Hanson of the University of California, San Diego — is starting to untangle the two forces that both the conventional wisdom and the academy agree are probably responsible for a lot of what is happening to the middle class.

Those forces are technological change and trade. The easy assumption is that the two go together. After all, trade needs technology — it is hard to imagine outsourcing without the Internet, sophisticated logistics systems and jet travel. Technology is dependent on trade, too: The opportunity for global scale is one reason technological innovation has yielded such outsize rewards.

But in a careful study of local labor markets in the United States, Mr. Autor, Mr. Dorn and Mr. Hanson have found that trade and technology had very different consequences for jobs.

“We were surprised at how distinct the two were,” Mr. Autor said. “We found that the trade shock had a very measurable impact on the employment rate. Technology led to job polarization, but its employment effect was minimal.” Trade, at least in the short term, really did ship jobs overseas. Technology did not kill jobs per se, but it did hollow out those essential jobs in the middle.

The big surprise, at least for believers (like me) in the classic liberal economic view that trade benefits both parties, is the strong and negative impact of globalization on U.S. workers — Mr. Autor estimates it accounts for 15 to 20 percent of jobs lost.

“The rise of China was such a huge change. It really did matter,” Mr. Autor said. “First, China is such a huge country. Two, China was 40 or 50 years behind in technology, so it had a lot of catching up to do. Third, it happened so fast.”

What is striking, and frightening, is the extent to which, at least in the U.S.-China trade relationship, the knee-jerk, populist fears intellectuals tend to deride actually turned out to be true.

“U.S.-China trade is almost a one-way street. This trade relationship doesn’t clearly give you the benefit that you can sell a lot of stuff to your trade partner,” Mr. Dorn said. “If you talk to someone who is somehow involved in the promotion of free trade, they may say that maybe the headquarters of Apple benefits. That may be true. But the first-order effect is of job loss.”

The impact of technology is more familiar. Mr. Autor, Mr. Dorn and Mr. Hanson found that it did not create fewer jobs overall, but it did hollow out the jobs in the middle.

“Technology has really changed the distribution of occupation. That doesn’t necessarily go hand in hand with reduced unemployment, but it creates a more bimodal set of opportunities,” Mr. Autor said. “There is an abundance of work to do in food service and there is an abundance of work in finance, but there are fewer middle-wage, middle-income jobs.”

What is challenging about both of these trends, and what makes the hollowing out of the middle class a political problem as well as an economic one, is how different they look depending on whether you own a company or work for one.

Shipping middle-class jobs to China, or hollowing them out with machines, is a win for smart managers and their shareholders. We call the result higher productivity. But looked at through the lens of middle-class jobs, it is a loss. That profound difference is why politics in the rich democracies are so polarized right now. Capitalism and democracy are at cross-purposes, and no one yet has a clear plan for reconciling them.

Chrystia Freeland is editor of Thomson Reuters Digital.

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