China's state news agency launches search engine (AP)

BEIJING – China's main government news agency launched an Internet search site Tuesday, giving its own sanitized view of the Web following Google's closure of its China-based search engine last year over censorship.

The Xinhua News Agency is operating http://www.panguso.com in partnership with state-owned China Mobile Ltd., the world's biggest phone carrier by subscribers.

The venture gives the ruling Communist Party a new tool to try to control what China's public sees online. Industry analysts say it might be commercially viable, drawing on Xinhua's news report and China Mobile's vast subscriber base, but is unlikely to challenge local industry leader Baidu Inc., which has more than 75 percent of China's search market.

Xinhua and China Mobile announced the venture in August after Google Inc. closed its China-based search engine, saying it no longer wanted to comply with Chinese censorship and complaining its e-mail service was hacked from China.

Xinhua said it hopes to make Panguso one of China's leading search engines.

"We would like to fully exploit the advantage of Xinhua as an official agency having a large collection of news and information, and that of China Mobile in terms of technology, advanced operation principles and strong infrastructure," said Xinhua president Li Congjun in a statement released by the agency.

China has the world's biggest population of Internet users with 457 million people online as of Dec. 31, and 303 million people searched the Web by mobile phone last year, according to a state-sanctioned industry group, the China Internet Network Information Center. China Mobile says it has more than 589 million accounts.

Beijing promotes Web use for business and education but its extensive filters bar access to material deemed pornographic or subversive. Search engines in China are required to exclude results of banned sites abroad.

Panguso, available on both Web and mobile phone, appears to filter even more stringently than other Chinese sites.

A search on Panguso for Liu Xiaobo, the jailed activist and Nobel Peace Laureate, returned no results. A search on Baidu turned up Chinese-language commentaries criticizing Liu.

Searches on Panguso for the Dalai Lama turned up tourism information for Tibet, followed by commentaries from Chinese state media criticizing the exiled Tibetan leader.

And Panguso has politically embarrassing gaps. It returned no result in a search for the website of People's University in Beijing, the first university founded after the 1949 communist revolution and one of China's most prominent institutions.

Baidu claimed a 75.5 percent share of China's online search market in the final quarter of last year, according to Analysys International, a Beijing research firm. Google was second but its market share fell to 19.6 percent, down from 30.9 percent before the closure of its China search engine.

China's mobile phone-based search market is more fragmented. Baidu leads with 34.3 percent but local rivals such as Easou.com also have double-digit market shares.

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AP researcher Yu Bing contributed to this report.

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Republicans challenging unions in state capitols (AP)

By DAVID A. LIEB and SAM HANANEL, Associated Press David A. Lieb And Sam Hananel, Associated Press – 2 hrs 19 mins ago

Republicans who swept into power in state capitols this year with promises to cut spending and bolster the business climate now are beginning to usher in a new era of labor relations that could result in the largest reduction of power in decades for public employee unions.

But as massive public protests and legislative boycotts in Wisconsin this week have shown, the Republican charge can be fraught with risk and unpredictable turns as politicians try to transform campaign ideas into action.

The question GOP governors and lawmakers are now facing is exactly how far they can go without encountering a backlash. Do they merely extract more money from school teachers, prison guards and office workers to help ease their states' budget problems? Or do they go at the very core of union power by abolishing the workers' right to bargain collectively? Do they try to impose changes by steamrolling the opposition, or by coming to the bargaining table?

"The consequences will be rolling forth for many, many years," said James Gregory, director of Center for Labor Studies at the University of Washington. "The battle lines have been drawn and will be replicated around the country. This is going to be very tough for unions and public sector employees."

In Wisconsin, new Republican Gov. Scott Walker is going for it all — the elimination of collective bargaining rights for public employees plus sharp increases in their health care and pension payments. His plan advanced quickly to the Republican-led Senate, despite several days of protests that drew tens of thousands of demonstrators to the Capitol. Then Senate Democrats suddenly fled the state Thursday, bringing the legislative process to a halt.

Wisconsin was the first battleground. But it is unlikely to be the last.

A similar proposal to strip public employees of collective bargaining rights drew throngs of protesters Thursday at the Ohio Capitol. Hundreds more have demonstrated in Tennessee and Indiana, where Republican-led committees have advanced bills to restrict bargaining rights for teachers' unions. And governors from Nevada to Florida have been touting the need to weaken union powers and extract more money from government employees to help balance out-of-whack budgets.

The confrontation comes as organized labor is reeling from a steady loss of members in the private sector. The public sector, with about 7.6 million members, now account for the majority of workers on union rolls, according to the federal Bureau of Labor Statistics.

Among union leaders, a sense of crisis is growing. Labor is preparing to spend at least $30 million to fight anti-union legislation in dozens of states, according to internal budget numbers reviewed by The Associated Press. They're lobbying local officials, organizing public rallies, working phone banks and buying television and newspaper ads in a desperate attempt to swing public opinion.

"Plans are being put into place to silence workers, lower their wages, cut their benefits and increase the likelihood that they will suffer injuries and fatalities at work," said Gerald McEntee, president of the American Federation of State, County and Municipal Employees. "It is happening at a breakneck pace and too little attention is being paid."

Labor plans to spend large amounts of money on battles in Florida, Indiana, Michigan, Minnesota, New Jersey, Ohio, Missouri, New Hampshire, Maine, Pennsylvania and Wisconsin. Unions see their goal as not just playing defense — as opponents chip away at bargaining rights — but going on offense to try to educate the public about the role of unions.

But last fall's midterm elections, which brought the defeat of many union-supported candidates and victories by pro-business Republican adversaries, show the difficulty the unions face in a climate shaped by the sour economy. In many states, Republican governors have blamed unions in part for the state budget crisis by negotiating flush benefit packages for public workers that have forced states to slash aid to schools, social services and important services.

Wisconsin's legislation, for example, not only would eliminate collective bargaining rights but also force public workers to pay half the costs of their pensions and at least 12.6 percent of their health care coverage — increases the governor calls "modest" compared with those in the private sector. It's projected to save $300 million over the next two years to address a $3.6 billion budget shortfall.

Ohio Gov. John Kasich, citing an estimated $8 billion budget gap, wants to restrict union rights for state workers and in townships, cities, counties, school districts and publicly funded universities. The legislation would generally eliminate salary schedules.

Kasich drew support Thursday from local tea party leader Ted Lyons, an electronics executive from Troy, Ohio, who said the proposed union changes are long overdue. "The labor unions have become so powerful now on a worldwide basis," Lyons said. "It's beyond just the benefits of the membership, it's about all the spending."

Lyons' voice was nearly drowned out by a crowd of protesters.

But some other Republicans are intentionally avoiding the sorts of confrontations that have sparked demonstrations.

Michigan Gov. Rick Snyder, the former chief operating officer of computer manufacturer Gateway Inc., won election last November on a similar pro-business agenda and also wants savings from public employee costs. But he's not seeking to abolish collective bargaining rights and has publicly denounced legislative efforts to strike at union membership and fees.

Snyder wants all government employees to pay 20 percent of their health care premiums. But he's not ramming the change at unions, and went out of his way Thursday to highlight his desire to work with them.

"As a practical matter, we're asking for $180 million in concessions, and we know we need to go bargain for that," Snyder told reporters Thursday after delivering his 2011-12 budget proposal. "We want to do that thoughtfully in partnership with our employees. We're not here to create threats."

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Associated Press writers Julie Carr Smyth in Columbus, Ohio, and Kathy Burks Hoffman in Lansing, Mich., contributed to this report. Lieb reported from Jefferson City, Mo., and Hananel reported from Washington, D.C.

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California governor Brown freezes state hiring (Reuters)

SAN FRANCISCO (Reuters) – California Governor Jerry Brown ordered a hiring freeze on Tuesday across the state's government to help cut costs in the face of a budget gap of at least $25 billion.

The budget deficit of the nation's most populous state is closely tracked in financial markets. California is the biggest issuer of U.S. municipal debt, and is of concern in Washington as some in Congress have discussed crafting legislation to allow states to declare bankruptcy to ease their fiscal woes.

The U.S. economy may be recovering but state and local governments still face weak revenue due to the recession, housing and financial market slumps, hesitant consumer spending and high unemployment.

Brown's order applies to vacant, seasonal, full-time and part-time positions and will save $363 million in operational costs in the next fiscal year beginning in July, Brown's office said.

"The hiring freeze will be in effect until agencies and departments prove that they can achieve these savings," Brown, sworn in last month, said in the statement.

It was the latest move by the 72-year-old Democrat to trim state spending on his own as he seeks approval from lawmakers for his budget plan.

It includes proposals for $12.5 billion in spending cuts and calls on the legislature to put a ballot measure to voters in June to extend tax increases scheduled to expire this year.

Democrats, who control the legislature, are expected to support Brown's cuts to help win Republican votes needed to advance a measure to the ballot.

The tax extensions, spending cuts and other moves would close a budget gap Brown estimated last month in his budget plan at $25.4 billion through mid-2012.

That deficit may swell to more than $27 billion after Brown canceled a plan to sell state buildings and if his proposal for creating a nearly $1 billion reserve survives budget talks with lawmakers.

In addition to the hiring freeze, Brown has ordered sharp reductions in mobile phones for state employees and in the state's vehicle fleet.

To further underscore frugality, Brown recently took a commercial passenger flight -- coach and without entourage -- to Southern California to urge business groups to support a referendum on tax extensions.

(Reporting by Jim Christie; Editing by Xavier Briand)

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Wisconsin governor aims to curb state worker unions (Reuters)

MADISON, Wisconsin (Reuters) – Wisconsin's new Republican governor on Friday proposed sharply curtailing the bargaining rights of public employee unions and other cost-saving measures to rein in the state's budget deficit.

Governor Scott Walker said he will ask the Republican-controlled legislature to pass his "budget repair bill" next week. He said it aims to bring stability to government finances and stave off employee layoffs.

"The last thing we need is any more people on unemployment," Walker said at a news conference.

The proposal drew criticism from Democrats in the state, which has a $137 million budget deficit in the fiscal year ending June 30 and larger deficits to come.

"If Republicans get their way, workers will no longer be able to negotiate over the hours they work, the safety conditions they labor under or the health insurance and retirement benefits they and their families depend on," Senate Democratic Leader Mark Miller said in a statement.

The proposal includes limiting state employee wage increases to the rate of inflation unless approved in a voter referendum. Public employees -- other than police, fire, and inspectors -- would lose many bargaining rights and could opt out of paying union dues after current contracts expire, with dues no longer collected automatically.

State workers will have to increase contributions to their pensions to 5.8 percent of salary, and double contributions to health insurance premiums to 12.6 percent of salary. Wisconsin's unfunded pension liability is $252.6 million, according to Moody's Investors Service.

The plan calls for raising appropriations for prisons and the Medicaid program, which is underfunded by $153 million, while making changes to the health insurance program for the poor. It also calls for selling the state's heating plants.

Walker's plan also would allow the state to push principal payments due March 15 on its general obligation bonds into future years to gain $165 million through a debt refinancing. That money would help cover a court-ordered payment to the Injured Patients and Families Compensation Fund and payments under the state's tax reciprocity program with Minnesota.

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State employee unions made $100 million in concessions in December to ease the budgetary strain, said Bryan Kennedy, president of the state chapter of the American Federation of Teachers. But Walker's response has been "to eviscerate our most basic rights" and "end labor peace in Wisconsin."

Leading Republican lawmakers say workers have to share the pain of shoring up the state's unsustainable financial problems -- a projected $2.9 billion biennial budget deficit for fiscal 2012 and 2013. This year's budget totals $12.7 billion.

"Anything short of making the tough decisions that are necessary to balance our budget and rein in spending is going to leave our state bankrupt, and the livelihood and well-being of Wisconsin will depend on the swift and decisive action we'll be taking over the next week," state House Majority Leader Scott Suder said.

A growing number of deficit-ridden states have tried to curb expenses by going after public employee union contracts and pensions. Wall Street rating agencies and investors in the $2.8 trillion municipal bond market are increasingly focusing on the cost of employee benefits like pensions as they weigh the credit-worthiness of state and local government debt.

Walker's plan to eliminate all bargaining rights of public sector workers except for a limited discussion of wages is draconian, according to one legal expert.

"Not only is this inconsistent with international human rights law, which recognizes a right to collectively bargain with one's employer, but it also flies in the face of decades of cooperation between the labor movement and the government in Wisconsin," Marquette University law professor Paul Secunda said.

(Additional reporting by Karen Pierog and John Rondy, Writing by Andrew Stern, Editing by Dan Grebler)

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State TV: Arrest warrant for Pakistan's Musharraf (AP)

ISLAMABAD – An anti-terrorism court judge issued an arrest warrant Saturday for former Pakistani military ruler Pervez Musharraf in connection with the 2007 assassination of ex-premier Benazir Bhutto, state-run television reported.
The warrant is the latest legal trouble to face the retired general, a one-time U.S. ally who left Pakistan for Britain in 2008 after being forced out of the presidency he secured in 1999 military coup. Despite his promises to return to Pakistan and lead a new political party, court motions against the former ruler make it increasingly unlikely he will.
Along with issuing the warrant Saturday, Judge Rana Nisar Ahmad also ordered Musharraf to appear before the court on Feb. 19, Pakistan Television reported. Lawyers in the case could not immediately be reached for comment.
Bhutto was killed Dec. 27, 2007, in a gun and suicide bomb blast during a rally weeks after returning to Pakistan to campaign in new elections that Musharraf reluctantly agreed to allow after months of domestic and international pressure.
It was not immediately clear on what basis the arrest warrant was issued. But many of Bhutto's supporters accuse the former president of intentionally not doing enough to ensure her protection, and trying to cover up government ineptitude in the case afterward.
Musharraf spokesman Saif Ali Khan told a private channel that the former leader will defend himself before the court "at an appropriate time." He did not elaborate.
After her death, Bhutto's Pakistan People's Party rode a wave of public sympathy to garner the most seats in the February 2008 elections. Months later, the party forced Musharraf to quit the presidency by threatening impeachment. He left for London later in the year, and has since spent a good deal of time on the lecture circuit, including in the United States.
The U.S.-backed Musharraf for much of his military rule because he was, at least officially, an ally in the American-led war on global terrorism, and provided Washington assistance in pursuing militants who used Pakistan's soil as a hideout to prepare attacks in neighboring Afghanistan.
But domestic mistakes, including his attempts to fire the chief justice of the Supreme Court, pummeled his popularity, leading to mass protests that ultimately led Musharraf to allow the new elections.
The new Pakistani president and head of the ruling People's Party is Asif Ali Zardari, Bhutto's widower. He also supports the U.S. and has backed offensives against militants on Pakistani territory.
Also Saturday, a man detonated explosives as army troops prepared to storm his hideout in northwest Pakistan, killing himself and wounding at least three soldiers, a senior army official said.
The blast occurred outside the town of Bhat Khela in Khyber Pakhtunkwa province after troops acting on a tip from residents surrounded a militant hideout and told those inside to surrender, Brig. Saeed Ullah said. Soldiers killed a second militant in the shootout that followed the explosion.
Ullah said security forces detained five men from the area on suspicion of sheltering the militants, who he said were planning a suicide attack in the Swat Valley. Bhat Khela is located about 30 miles (50 kilometers) west of Mingora, the main town in Swat.
The Pakistani army launched a major anti-Taliban offensive in 2009 in Swat, a one-time tourist haven largely overrun by militants beginning in 2007.
Though the monthslong offensive was hailed a success, militant activity is still reported in the picturesque region and concerns are growing that the insurgents could rise again.
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Associated Press Writer Sherin Zada contributed to this report from Mingora.
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