JAPAN & US: Toyota To Agree To $16.4 Million Fine

April 19, 2010

by The Associated Press

Toyota Motor Corp. is expected to agree to a fine of more than $16 million, the largest government penalty levied against an automaker, for a four-month delay in telling federal authorities about defective gas pedals on its vehicles, a Transportation Department official said Sunday.

Toyota faces a Monday deadline to accept or contest the $16.4 million fine over evidence it knew about sticking gas pedals in September but did not issue a recall until January.

The Transportation official was not authorized to speak publicly and spoke only on condition of anonymity. The official said Toyota is expected to pay the full amount of the assessed fine within 30 days as a means of avoiding going to court against the government.

The official said Toyota did not intend to accept liability explicitly. But from the government's viewpoint, the official said, the agreement to pay the full fine constituted an acceptance of responsibility for hiding the safety defect in violation of the law.

Toyota did not immediately comment on the fine. Under federal law, automakers are required to notify the government within five business days when they find a potential safety defect.

Toyota announced it would recall 2.3 million vehicles in January to address sticking pedals on popular vehicles such as the Camry and Corolla. The Japanese automaker has recalled more than 8 million vehicles worldwide because of acceleration problems in multiple models and braking issues in the Prius hybrid.

Concerns about sticking gas pedals and complaints from Toyota owners in the U.S. were rising at the end of 2009, according to chronologies of the investigation Toyota provided to the government.

The National Highway Traffic Safety Administration said documents provided by Toyota showed the automaker had known about the sticky pedal defect at least since Sept. 29, 2009, when it issued repair procedures to distributors in 31 European countries to address complaints of sticking pedals, sudden increases in engine RPM and sudden vehicle acceleration.

The documents also showed that Toyota knew that owners in the United States had experienced the same problems.

The Japanese automaker has been weighing its options since the fine was announced in early April but analysts expected it to pay the penalty.

The company has been named in 138 potential class-action lawsuits over falling vehicle values and about 100 personal injury and wrongful death cases in federal courts. Federal prosecutors and the Securities and Exchange Commission are conducting investigations related to the recalls.

"When you look at the toll it's taken on Toyota's reputation, when you look at the number of vehicles involved, when you look at the hardship it's placed on Toyota's customer base, it's only right for Toyota to take this fine," said Dennis Virag, president of Automotive Consulting Group based in Ann Arbor, Mich.

Transportation officials have not ruled out additional fines. The department is reviewing whether Toyota delayed for six weeks the late January recall of the 2009-2010 Venza in the United States to address floor mats that could entrap the accelerator pedal after making a similar recall in Canada.

Toyota recalled the Venza in Canada in December and reported to the U.S. government on Dec. 16 that the floor mats could move forward while the vehicle is in use and "may interfere with the accelerator pedal."

Toyota told U.S. authorities at the time that the floor mats in question were not imported into the U.S. but the Venza was added to the floor mat recall in late January.

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CHINA: In China, a one-man crusade to help the disabled

Peng Jing, 6, who has cerebral palsy, practices walking with the aid of parallel bars his parents copied from a Chinese hospital. His mother, Lu Hui, right, says Peng has made progress. By Bruce Li

By Calum MacLeod and Sunny Yang, USA TODAY

XIAOGAN, China — The nighttime cry sounded like a stray cat. The cold morning light revealed a stray baby instead, wrapped in a quilt beside a bag of diapers and a packet of milk powder.

"Don't blame us for our cruelty, it's because we can't afford to raise you," read an anonymous note.

The baby girl, perhaps 1 month old, had a severely disabled left foot.

Such a deformity in China is considered an enormous burden, and up until recently there were no privately run homes for the disabled in the entire country. One such home is where the child was left, established in January by Chen Fuqiao.

"I want to teach them how to help themselves, more or less, and give the better ones a chance to work," Chen says.

The hurdles are high for people such as Chen who are trying to help the disabled live more normal lives. The Communist Party in control of China does not like group efforts that are independent of the state, he says.

Not so in the West, where institutions have largely given way to group homes or apartments in neighborhood settings that allow people with mental and physical disabilities to be part of the community. Much of the housing is run by community-based organizations.

In China, all decisions regarding its disabled are made by the Communist Party, which prefers traditional institutional care. When individuals such as Chen try to do things differently, they run into a system that distrusts civic action.

Running into resistance

Chen has been refused official registration and funding even though he is providing for 27 children and young adults in his hometown of Xiaogan, in eastern China.

This month, Beijing further limited the amount of money an organization not controlled by the government can take from foreign donors.

More than 13 million of China's estimated 83 million physically handicapped people also have learning disabilities, says Yang Xiang, head of the juvenile research institute at the Shanghai Academy of Social Sciences.

Wealthier cities such as Beijing and Shanghai fund special education programs, but about 60% of those 13 million remain "stuck at home," in the poorer countryside with little access to help, Yang says.

Chen, whose 20-year-old son has suffered learning disabilities since birth, left his job at a fertilizer factory to set up a small supermarket in the 1990s. The joy Chen experienced training his son to run for the Special Olympics convinced him he could help others.

Since 2007, he has ridden his old motorbike around Xiaogan and nearby villages looking for families like his own while still managing his grocery.

The response was overwhelming. In a city of 5 million, Chen says he discovered at least 1,000 families struggling to raise children with disabilities. Municipal statistics from 2006 say that 28,000 of Xiaogan's 309,000 disabled people are mentally handicapped.

Most of the children spend all day at home, looked after by their mothers, Chen says.

The Chinese sense of duty to care for one's parents, popularized by Confucius, runs deep in Xiaogan city, named after a famous legend of filial piety. At Chen's center, that tradition is reversed.

"My aim is to let the parents of families like mine leave the world without worry," explains Chen, 46, a soft-spoken Buddhist. "There is a place they can trust, and make their children happier."

After just two months, Shi Biyu is already convinced.

"She never said 'good morning' before, but she did it all day after joining Mr. Chen's center," Shi says of daughter Zhou Mei, a baby-faced 36-year-old who was clutching a Mickey Mouse doll. "I can't die with my eyes closed if Meimei doesn't have a good place to go. Now I set my mind at rest."

Others must wait for Chen's help.

Every day the parents of Peng Jing, 6, strap him into a "standing shelf," a contraption copied from a hospital device, that they hope will improve his walking. Peng, who has cerebral palsy, cries every time he is strapped in.

"He hates using the equipment," says Lu, who softens the pain by giving Peng treats from KFC.

Beijing may be coming around, however.

At the annual session of parliament last month, Premier Wen Jiabao included for the first time in his government report additional assistance for services for the disabled. Zhang Haidi, head of the China Disabled Persons' Federation, said that China urgently needs more funds for disabled people in remote villages.

Still, "Compared to problems like house prices, corruption and health care, I fear the problem of the mentally disabled is now pretty much near the back," Yang says.

Gratitude for efforts

In Xiaogan, local government officials appreciate Chen's efforts.

"He helps our work, but the financial help we can give him is limited," says Xu Zemin, deputy head of the municipal disabled persons' federation.

Meng Weina, a pioneer in caring for China's disabled, says attitudes have improved from days when people with disabilities were called "cripples" or "idiots."

"The government realizes it can't do everything," Meng says.

Meng's outspokenness on the need to change the way the disabled are treated has cost her official support for her services organization, which are now in 11 cities, she says.

"It's a miracle we have kept going," says Meng, a Catholic inspired by Mother Theresa.

Chen Fuqiao may need a miracle.

All but one of the 17 nurses he took on earlier this year have left because of low salaries, he says. His wife complains he is neglecting the family grocery.

"I pray to Buddha every day," Chen says. "I ask him, 'Am I right or wrong to do this?' "

In the morning he is back at it. He has a sports meet to prepare for, he says, and a lot of hopes riding on his shoulders.

MacLeod reported from Beijing; Yang from Xiaogan.

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TRAVEL: Senator: Airlines Pledge Not To Charge For Carry-Ons

April 18, 2010

by The Associated Press

U.S. airlines never met a fee they didn't like. Until now, it seems.

Five major carriers on Sunday agreed not to follow the lead of a small Florida airline that plans to charge for carry-on bags. Their commitment comes just in time to keep travelers from running for the exits during the peak summer flying season, but it is doubtful that it marks a change in strategy.

The promise to New York Sen. Charles Schumer from American Airlines, Delta Air Lines, United Airlines, US Airways and JetBlue Airways comes despite the fact that some of those same airlines are expected to report first-quarter losses next week. They were stung by higher fuel prices and the heavy February snowstorms.

Ancillary fees for air travel -- including baggage fees, reservation change fees and other miscellaneous operating revenue -- have been piling up.

For U.S. carriers, they totaled $1.95 billion in the third quarter of 2009, roughly 36 percent higher than for the same period a year earlier. For 26 large U.S. airlines, those fees made up 6.9 percent of their total operating revenue in the third quarter of last year, according to the most recent government data available.

But major carriers risk alienating customers if they follow Spirit Airlines' lead and impose a fee on carry-on bags. In August, Spirit will begin charging customers up to $45 to place a bag in an overhead bin.

Other fees haven't stopped people from flying, but many can be avoided. Carry-on bag fees would be hard to avoid.

"We believe it is something that's important to our customers and they value, and we will continue making that available to them at no charge," American Airlines spokesman Roger Frizzell said.

It wasn't clear how long the five airlines had pledged not to charge for carry-ons. Frizzell couldn't say, and a spokesman for Delta declined to comment.

Schumer and five other Democratic senators -- New Hampshire's Jeanne Shaheen, Maryland's Ben Cardin, Minnesota's Amy Klobuchar, and New Jersey's Robert Menendez and Frank Lautenberg -- support legislation that would tax airlines if they charge carry-on bag fees.

Schumer said the legislation will move forward until it becomes clear that no airline will institute the charges. He will have an uphill battle changing the minds of Spirit executives when he meets with them soon.

Spirit CEO Ben Baldanza told The Associated Press on Sunday that his airline is moving ahead with its carry-on bag fee.

"Our plan was never predicated on anyone matching us," Baldanza said. "The fact that other people are saying they won't has never changed our view that this is right."

He said his competitors' decision actually puts pressure on those airlines because Spirit has lowered its fares more than the price of the new fee.

"We knew we took a risk with this strategy, but we believe on balance it's one that our customers will buy into," Baldanza said.

Analysts expect several major carriers to get back in the black in the current quarter -- the second quarter -- and in the second half of the year, thanks to the summer and holiday travel rushes. They wouldn't want anything like an uproar over carry-on bag fees to keep passengers from flying.

Even so, for the financial improvement airlines have seen to be sustainable, revenue needs to keep rising -- either through higher fares, more fees or both -- and airlines need to better position themselves in case fuel prices spike even higher.

On the last day of the first quarter -- March 31 -- the price of a barrel of oil closed at $83.76, more than 68 percent higher than on the same day a year earlier.

That means if major carriers don't charge for carry-ons, they could increase existing fees or institute new fees altogether.

Any way you cut it, that adds up to less money in the pockets of U.S. air travelers.

"As a practical matter, as industry conditions change and if profitability is further challenged, we're likely to see some sort of price increase," aviation consultant Mark Kiefer said.

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CHINA: Chinese President Hu Flies To Tibetan Quake Zone

April 18, 2010

by The Associated Press

Badly needed aid finally is arriving in a remote western China town shattered by an earthquake, including enough food and shelter for tens of thousands of suddenly homeless, though some complained it wasn't reaching everyone in need.

The surge in aid coincided with the arrival Sunday of Chinese President Hu Jintao, who cut short an official trip to South America to deal with the disaster in this remote Tibetan region where residents have frequently chafed under Chinese rule. The quake Wednesday killed 1,706 people and injured 12,128.

The president's carefully scripted trip included visits with displaced families living in tents and rescue teams as they dug through debris looking for the 256 still missing. He promised that the Communist Party and the government was doing everything they could. Tibetan anger over political and religious restrictions and perceived economic exploitation by the majority Han Chinese have sometimes erupted in violence.

China Central Television showed Hu sitting with a Tibetan middle school student at a field hospital and comforting her as she wept. Her right arm was bandaged and supported by a sling.

"Rest assured, you will have a full recovery," he told the girl. "You will have a bright future. Grandpa will be thinking of you."

Hu and Chinese Premier Wen Jiabao, who visited Jiegu on Thursday, have both cultivated compassionate, grandfatherly images to portray the leadership as putting people first.

From 1988 to 1992, Hu was the party boss of Tibet, which neighbors Qinghai province where the earthquake struck, and he has a mixed reputation among ethnic Tibetans. A hardline governor, he oversaw the imposition of martial law in Tibet in 1989 after anti-government violence erupted there. As the country's top leader, he has maintained a firm line on dissent while also championing policies that have funneled billions of dollars in aid and investment to Tibetan areas.

On Sunday, after days of sleeping in makeshift shelters, with ice forming on blankets during the frigid nights, nearly all survivors finally had proper tents and enough food and clean water to last at least a few days.

The sudden bounty appeared to come in the nick of time. Relief workers had warned that Jiegu was teetering on the edge of unrest, with people fighting over tents and other limited goods. Bottlenecks on the winding mountain road that links Jiegu to the provincial capital of Xining -- normally a 12-hour drive -- were blamed for the earlier trickle of supplies.

Zou Ming, head of disaster relief at the Ministry of Civil Affairs, told a news conference in Beijing that most survivors now had tents, basic food and clean water.

Government-issued blue tents that were sparsely dotted around town in recent days popped up in abundance on Sunday. Some families set them up next to the ruins of their flattened mud brick homes. Others pitched theirs on a horse racing track turned refugee camp, the largest of several tent cities in Jiegu.

In one corner of the track was Genyao, 65, and his more than 20 family members. He pushed back the flap of one of their four tents to reveal two dozen cases of water, instant noodles and canned meat. Nearby, two blackened pots bubbled on top of a stove made from concrete blocks.

"It's manageable. The country cares about us," said Genyao, who goes by one name, a smile creasing his weather-beaten face. But, he pointed out, "The pots, the blankets, those we pulled out of the rubble of our house ourselves."

China Central Television showed Hu visiting a similar scene, the camera panning over stacks of food boxes and a crate of water in the corner.

"I guarantee the party and the government will help you build a new home and make sure your children can return to school as soon as possible," Hu said to a Tibetan man who grasped the president's hand and bowed his head repeatedly, saying "Thank you, thank you."

A few remained left out. A 43-year-old Tibetan man who refused to give his name said he and 15 other relatives were still living under tarps strung between wooden beams. He said others were stockpiling tents to sell and intimidating people like him who lined up to get them for free. He said his neighbor ended up paying 600 yuan ($90) for one.

"We're locals and we can't even get a tent," he said. "It's people from out of town who are taking tents."

To prevent such stockpiling and other problems, authorities Sunday were delivering aid to sites run by a specific county or town in the region, and residents originally from those places could register and get supplies there.

The system meant however that some people, particularly migrants, had no fixed aid station to go to.

Liu Shuzhen, a construction worker from neighboring Gansu province, was among those falling through the cracks. Liu, her husband and their four-year-old son were sleeping on plastic sheeting with a few tattered blankets pulled from the rubble.

She crouched in the blowing dust at the racetrack, guarding a battered box with a few bread rolls and bottles of water that Tibetan Buddhist monks had thrown down from a passing truck.

"When President Hu comes, maybe they'll hand out relief supplies and we could get some," Liu, 29, said hopefully, her right eye black from when the family's one-room home collapsed as they slept.

But Hu's expected visit to the racetrack didn't happen and the family was preparing to sleep another night in the cold.

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