China Frees SARS Hero

Detained Over a Letter

China has released the dissident physician who became a national hero for exposing the government's coverup of the SARS epidemic, sending him home on Monday after 49 days of confinement aimed at pressuring him to disavow a letter in which he denounced the 1989 Tiananmen Square massacre.

Jiang Yanyong, 72, a semi-retired surgeon in the People's Liberation Army who had briefly become China's most famous political prisoner, was returned to his apartment in western Beijing and appeared in good health, said his wife, Hua Zhongwei, by telephone.

She said she and Jiang had been ordered by the Chinese military not to speak to reporters, so she declined to discuss the circumstances of his release. A person close to the family said Jiang succeeded in resisting the demands of his jailers despite seven weeks of intense indoctrination sessions.

Jiang was never charged with a crime, and the government had said that the military was "helping and educating him" because he had violated military discipline.

-- Philip P. Pan

Defense Department

Scrambles for Funds

The U.S. military has spent most of the $65 billion that Congress approved for fighting the wars in Iraq and Afghanistan and is scrambling to find $12.3 billion more from within the Defense Department to finance the wars through the end of the fiscal year, according to a report from the Government Accountability Office, Congress's investigative arm.

It warned that the budget crunch is having an adverse impact on the military as it shifts resources to Iraq and away from training and maintenance in other parts of the world. The study appears to contradict White House assurance that the services have enough money to get through the calendar year.

Already, the GAO said, the services have deferred the repair of equipment used in Iraq, grounded some Air Force and Navy pilots, canceled training exercises, and delayed facility-restoration projects. The Air Force is straining to cover the cost of body armor for airmen in combat areas, night-vision gear and surveillance equipment, the report says.

The Army, which is overspending its budget by $10.2 billion for operations and maintenance, is asking the Marines and the Air Force to help cover the escalating costs of its logistics contract with Halliburton Co. But the Air Force is also exceeding its budget by $1.4 billion, while the Marines are coming up $500 million short. The Army is even having trouble paying the contractors guarding its garrisons outside the war zones, the report said.

-- Jonathan Weisman

Berger, Under Investigation,

Leaves Kerry Campaign

Clinton administration national security adviser Samuel R. "Sandy" Berger, under criminal investigation for removing copies of highly classified documents from the National Archives, severed his ties to Sen. John F. Kerry's campaign.

Berger, who has been the subject of an investigation since October, stepped down as Kerry's informal adviser on foreign policy and national security.

A government official with knowledge of the probe said Berger removed from archives files all five or six drafts of a critique of the government's response to the millennium terrorism threat, which he said was classified "codeword," the government's highest level of document security.

Berger's attorneys have acknowledged that he removed numerous classified memos, and apparently discarded some, as he reviewed materials on behalf of the Clinton administration for the independent commission investigating the Sept. 11, 2001, attacks.

-- Susan Schmidt

NASA to Allow Satellite

To Fall From Earth's Orbit

NASA is allowing a highly successful satellite to fall out of Earth's orbit by refusing to fund it for as little as $28 million, dismaying the scientists and forecasters who use its unique abilities to study climate change and track hurricanes.

NASA officials said engineers did not order a planned firing of its rockets in early July to hold the Tropical Rainfall Measuring Mission satellite in orbit 241 miles above Earth. Without periodic assists from its thrusters, atmospheric drag will send the satellite's remains to a watery grave in six to nine months.

Engineers said the satellite, a joint venture with the Japanese Aerospace Exploration Agency, is working perfectly and could still be saved, but NASA officials said neither the Japanese nor other U.S. agencies were willing to contribute to the estimated $28 million to $36 million needed to keep the mission operating for as long as two more years.

The decision instead to use a "controlled de-orbit" for the satellite, known by its initials TRMM, was announced quietly July 13 in an internal NASA memo.

-- Guy Gugliotta

Microsoft Corp. to Pay Out

$32 Billion to Shareholders

Microsoft Corp., which has amassed an unparalleled cash hoard of nearly $60 billion from its world-dominating software business, announced that it would return a large chunk of it to shareholders, much of it through a one-time dividend of $3 for every share investors hold.

With 10.79 billion shares outstanding as of March 31, the company will pay out more than $32 billion in that one stroke, pending approval of the plan by shareholders.

Company chairman and founder Bill Gates stands to get about $3.3 billion, and he pledged to give the entire amount to his family foundation, already the nation's largest foundation. Chief executive Steven A. Ballmer would get about $1.2 billion. But other large holders include mutual funds with millions of average investors, including the Vanguard 500 Index Fund, the Fidelity Magellan Fund and the College Retirement Equities Fund.

The software giant, which last fiscal year generated profit that averaged $1.1 million every hour, has been under mounting pressure from Wall Street to put its growing pool of cash to better use than simply earning interest. Despite Microsoft's remarkable business success, the company's stock price has languished for two years.

In addition to the one-time payout, the company said it would double its annual dividend to 32 cents per share and buy as much as $30 billion of its own stock over the next four years. Buying back shares rewards all shareholders because it tends to drive up the price of the remaining stock.

-- Jonathan Krim

Greenspan Links Skills

To Disparity in Income

Federal Reserve Chairman Alan Greenspan, disputing election-year assertions that the U.S. economy is producing lower-quality jobs than it had in the past, said that continuing wage sluggishness reflects the fact that many workers are ill-prepared to take advantage of the opportunities that the economy offers.

Growing U.S. income inequality largely reflects differences in workers' education and job skills, not an underlying problem with the economy, Greenspan said during a House Financial Services Committee hearing on Wednesday.

The growing pay gap reflects the "skill premium" commanded by relatively higher educated, better-trained workers, and represents "a major problem of matching skills of workers to the technological base of the economy, which I believe is an education issue and requires that we address that as quickly and broadly as we can."

-- Nell Henderson