News

=Holder testimony on pardon questioned=

Attorney General-designate Eric H. Holder Jr. told Congress under oath that he had "only a passing familiarity" with the criminal case against billionaire Marc Rich before President Clinton pardoned the fugitive financier in 2001- testimony that is now raising concerns among lawmakers reviewing Mr. Holder's nomination. Correspondence with the Justice Department and testimony secured by Congress from other witnesses show that 15 months before the pardon, Mr. Holder met privately with Mr. Rich's attorney and received a presentation about what Mr. Rich's defense believed were flaws in the government's case. Mr. Holder, then serving as the No. 2 official in the Clinton Justice Department, later took the rare step of contacting federal prosecutors handling Mr. Rich's case in New York and, according to his own testimony, tried to "facilitate" a meeting with the defense. "We never pressured anybody to have the meeting; the call was for the Southern District of New York to make," he said. The prosecutors refused the request, in part because Mr. Rich had been a fugitive for 16 years and had taken no steps to turn himself in. The Republican lawmaker who investigated the controversial Rich pardon told The Washington Times that evidence documenting the 1999 contacts conflicts with Mr. Holder's testimony and that he has forwarded information he has on the subject to the Senate Judiciary Committee, which will examine President-elect Barack Obama's choice for attorney general. Mr. Holder "certainly had more than a passing familiarity with this case," said Rep. Dan Burton, Indiana Republican, who oversaw the House Government Reform and Oversight Committee when it investigated the Rich pardon in 2001. "I know human beings are fallible and they make mistakes, but making statements that are not accurate while under oath before a congressional committee goes beyond the pale," he said. "Sure as the dickens, he was not straight with our committee." Mr. Holder and the Obama transition team did not respond to repeated e-mails and telephone calls for comment. During his House testimony, Mr. Holder said his actions in the Rich case were "consistent with my duties and responsibilities as deputy attorney general," although in hindsight he said he wished he had "done some things differently" with regard to the matter. "Specifically, I wish that I had assured that the Department of Justice was more fully informed and involved in this pardon process," he said, adding that the Justice Department, Mr. Clinton and the American public, "in the cause of justice, would have been better served if the case had been handled through the normal channels."

=Economists: Recession to end in 2009=

NEW YORK The end of the recession is in sight, according to a new survey of leading economists. While the economy is showing signs of stabilizing, the recovery will be more moderate than is typical following a severe downturn, said the National Association for Business Economics Outlook in a report released Wednesday. The panel of 45 economists said it expects economic growth will rebound in the second half of 2009. However, the group still expects to see a decline in second-quarter economic activity. 0:00 / 03:11 "The good news is that the NABE panel expects economic growth to turn positive in the second half of this year, with the pace of job losses narrowing sharply over the remainder of this year and employment turning up in early 2010," said NABE president Chris Varvares in a written statement. Almost three out of four survey respondents expect the recession will end by the third quarter of 2009, the report said. But 19% predicted that a turnaround won't come until the fourth quarter, and 7% said it may not come until early 2010. None of the panelists expected the recession to continue past the first quarter of next year. 0:00 / 02:59 Still, "a modest second-half rebound in real GDP is expected," the report said, with economic growth turning positive in the third quarter. Real GDP growth over the second half of 2009 is expected to average 1.2%, which is well below average, the report said. "Growth in 2010 is slated for a return to near its historical trend," the report said, predicting a 2.7% year-over-year increase. The NABE's February outlook had predicted a 3.1% uptick. 0:00 / 5:18 Separate reports this month showed the unemployment rate is currently down in 21 states and stands at 8.9% nationally. But that spending will help push the federal deficit to a record-high $1.7 trillion in the 2009 fiscal year, before falling slightly to $1.4 trillion in fiscal 2010. The panelists were split on the issue of when home prices will hit their lows: 30% said it would happen by the third quarter of 2009; 30% said the fourth quarter; and 40% said declines will continue into 2010 or later. The median prediction is that home prices will rise 1% in 2010, the report said. 0:00 / 2:48
 * GDP:** The report predicted a 1.8% decline in real GDP in the second quarter of 2009, bringing the total year-to-date decrease to 3.7%. That's the biggest drop since 1957-1958, the report said.
 * Jobs:** The panel forecast a total of 4.5 million jobs lost in 2009, pushing the unemployment rate to 9.8%. Modest gains in 2010 will reduce the rate to 9.3% by year's end, the report predicted.
 * Deficit:** Government spending "will provide vital support to the economy," and will be the only expenditure sector to grow in 2009, the report said.
 * Housing:** New and existing home sales are close to their lows, with 72% of NABE panelists expecting sales to hit bottom by the middle of 2009. More than 60% of those surveyed said housing starts would also bottom out at the same time.
 * Spending:** Widespread job losses and weak income growth have reduced consumer spending and boosted the personal savings rate, the report said. The savings rate has seen two consecutive quarters of sharp increases, holding above 4% through March. More than 70% of the panelists expect "more thrifty behavior is here to stay, at least for the next five years," the report said.
 * Credit:** Obtaining long-term and short-term financing is still difficult, which poses a risk to the economy, but 90% of respondents said actions from the Federal Reserve have helped to ease the credit crunch.
 * Five-year outlook:** More than half of the NABE economists said they expected potential growth of the U.S. economy over the next five years to be between 2% and 2.5%; 37% of respondents forecast growth between 2.5% and 3%, while 7% of the panelists said growth will be higher than 3%. [[image:http://i.cdn.turner.com/money/images/bug.gif width="7" height="7" caption="To top of page" link="http://money.cnn.com/2009/05/27/news/economy/NABE_recovery_outlook/index.htm?postversion=2009052703#TOP"]]