Facebook flexes its political muscle

April 20, 2013

Facebook founder Mark Zuckerberg generated international attention for his entry into Washington politics. In launching a new political group, he positioned himself as a leading advocate to help aspiring entrepreneurs and other ambitious immigrants achieve the American dream.

Yet behind the scenes on Capitol Hill, Facebook lobbyists pressed to insert a few new words helpful to Facebook’s business interests into a sprawling legislative proposal.

The new measures are part of a compromise between the tech industry, which says it faces a shortage of qualified engineers and other high-skilled workers, and critics, including some labor unions who say the H1B visa program has been abused by firms seeking cheaper labor to maximize profits. The new carve-out for Facebook and other firms, critics fear, could help companies evade the stricter proposed regulations hailed by lawmakers as a way to limit abuses.

Business

Investors sent Apple’s shares below $400 on Wednesday for the first time since 2011; its stock performance weighed on the Nasdaq, which took a deep dive, falling 1.8 percent.

Samsung Electronics ended an online campaign in Taiwan amid a local regulator’s probe into whether the company broke the law by paying for positive product reviews and negative comments about rival smartphones, including those made by HTC.

Keystone XL pipeline backers and opponents gathered in Nebraska for the only federal public hearing before the Obama administration decides whether to allow its construction.

US Airways chief executive Doug Parker received a 44 percent increase in compensation, to $5.5 million, last year. The company’s proposed merger with American Airlines will make Parker head of the world’s biggest airline.

Macy’s is appealing a New York judge’s ruling that allows J.C. Penney to sell unbranded items designed by Martha Stewart’s company in certain categories exclusive to Macy’s.

J.C. Penney announced that it would draw $850 million from its $1.85 billion revolving credit line to pay for replenishing inventory, particularly for its overhauled home area. Analysts said the move shows that Penney is burning through cash faster than expected.

Investors who lost $1.2 billion to Wall Street swindler Bernard L. Madoff’s Ponzi scheme are poised to receive $405 million in payouts after a judge rejected Madoff trustee Irving Picard’s challenge to the settlement.

McDonald’s $700,000 settlement was approved with members of Michigan’s Muslim community over claims that a restaurant falsely advertised its food as prepared according to Islamic law.

Google said it plans to make Provo, Utah, its third Google Fiber City, after Kansas City, Kan., and Austin.

American Airlines grounded about 900 flights after its computer system failed.

Carnival said it will repay the U.S. government for the costs to taxpayers of responses to disabling accidents on its Triumph and Splendor cruise ships, both of which left thousands of passengers stranded at sea for days. Sen. John D. Rockefeller IV (D-W.Va.) estimated the Coast Guard’s costs in dealing with the disabled Triumph at nearly $780,000.

Deals

Dish Network announced a $25.5 billion bid for Sprint Nextel, challenging an offer by Japan’s SoftBank for the nation’s third-largest wireless carrier.

Earnings

Bank of America posted a first-quarter profit of $2.6 billion, even as revenue fell 8.4 percent, to $23.85 billion, across almost all of its businesses, and the bank was further hit by a legal settlement for mortgages, highlighting the difficulties chief executive Brian Moynihan faces in moving past the housing crisis.

Capital One Financial said profit tumbled 25 percent, to $981 million, from the same period a year ago, when the lender booked a hefty gain from its acquisition of online bank ING Direct.

Coca-Cola said profit fell 15 percent, to $1.75 billion, but its share price jumped the most in more than four years as it topped analysts’ estimates and announced a deal to sell some bottling distribution rights in North America.

Goldman Sachs said revenue from bond trading with clients fell 7 percent in the first quarter, raising questions about the health of the bank’s biggest moneymaker and the prospects for fixed-income trading profits on Wall Street. The trading results overshadowed the bank’s overall profit, which rose 5.5 percent, to $2.2 billion, as other businesses made up for trading declines.

Morgan Stanley’s profit slipped 12 percent, to $1.2 billion. Per share, those earnings amounted to 61 cents, beating the 57 cents expected by analysts.

Nokia, the former industry leader, continues to take a hammering in the smartphone market. It narrowed its first-quarter net loss to $356 million from a loss of $1.2 billion a year earlier, mainly because of cost-cutting.

PepsiCo shares surged to their highest price, $81.25, in at least 32 years after the world’s largest snack-food maker reported first-quarter profit that topped analysts’ estimates, helped by global snack sales. Beating estimates, first-quarter profit fell 4.6 percent, to $1.08 billion from $1.13 billion a year earlier.

Verizon said profit rose 16 percent, to $1.95 billion, for the latest quarter as wireless revenue kept rising at a rate that is the envy of the industry.

Yahoo forecast sales that fell short of analysts’ estimates as it continued to lose advertisers to Google and Facebook. First-quarter sales of display ads decreased 11 percent, to $455 million, from the same period a year earlier. Search revenue, excluding sales passed to partner sites, dropped 10 percent, to $425 million.

Economy

The U.S. economy posted a moderate pace of growth between late February and early April, supported by improved conditions in the construction sector and rising home prices in many parts of the country, the Federal Reserve said. The account by the Fed’s 12 regional banks was slightly more upbeat than the previous “beige book” survey.

Euro-zone companies face a “debt overhang” that could prolong the region’s downturn and risk a return to a more acute crisis, the International Monetary Fund warned.

U.S. homebuilders broke the 1 million mark in March for the first time since June 2008. The gain signals continued strength for the housing recovery at the start of the spring buying season.

Washington

Erskine Bowles and Alan K. Simpson,the deficit-cutting duo who have been trying for three years to broker a budget deal, released a plan that calls for $2.5 trillion in new taxes and savings over the next decade.

Transitions

Britain bade farewell to Margaret Thatcher, silencing Big Ben’s bells and mounting a display of pageantry as the hearse carrying her flag-covered casket wound along a historic two-mile route.

— From The Post and news services

$3.1 billion
Philip Morris settlement payment

The nation’s top cigarette companies made their payments as part of the long-standing settlement in which some cigarette makers are paying states for smoking-related health-care costs. The 1998 Master Settlement Agreement also includes R.J. Reynolds Tobacco, which paid $1.84 billion, and Lorillard, $900 million.

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