Pentagon Braces for

Weapons Program Cuts

Major U.S. weapons programs are facing big cuts, given budget pressures from the war in Iraq, rising fuel and personnel costs, and the need to rebuild the Gulf Coast, defense analysts said yesterday.

The Air Force, Navy and Army are drafting lists of programs that could be cut back before the White House's Office of Management and Budget issues its guidance to the Pentagon in mid-November.

The cuts could affect all large defense firms, although General Dynamics Corp. and others with big Army contracts deemed essential to the war in Iraq could be spared somewhat.

Businesses in Arrears

On Post-Sept. 11 Loans

Roughly one dollar of every five in loans the Small Business Administration directly made to companies hurt by the Sept. 11, 2001, terrorist attacks has fallen into default, leaving the government with an uphill effort to recover millions of dollars in taxpayer money.

The agency is just now learning about the large number of businesses that went under or stopped making payments. Its Sept. 11 direct disaster loan program often gave recipients two years before their first payments were due, according to documents reviewed by the Associated Press.

The SBA directly lent a total of $1.2 billion to more than 10,000 companies that made specific arguments about how their businesses were hurt by the airplane hijackings in 2001 that destroyed the World Trade Center in New York and damaged the Pentagon in suburban Washington. A plane bound for Washington crashed in rural Pennsylvania.

Of that amount, $245 million is in default, the records show.

For the Record

* Sen. Charles E. Schumer (D-N.Y.) has called for the temporary suspension of the patent for Tamiflu so that the anti-flu drug can be produced by other companies, after the weekend confirmation of the first case of the bird flu virus in ducks in Europe.

The World Health Organization has asked Hoffmann-LaRoche to increase production of Tamiflu as early as possible to prepare for a potential flu pandemic. Schumer has requested that the firm suspend its patent to allow other companies to make enough doses to treat 40 to 50 percent of the U.S. population.

* Department of Health and Human Services agencies failed to report 474 medical malpractice settlements or judgments over a seven-year period to a federal repository for doctor discipline records, according to a report released yesterday.

HHS Inspector General Daniel R. Levinson found that from June 1997 through September 2004, the National Institutes of Health, the Indian Health Service, and the Health Resources and Services Administration did not report the cases as required to the National Practitioner Data Bank. The data bank was created by Congress 15 years ago to stop doctors from moving to escape troubled histories.

The underreporting was caused in part by lost medical malpractice files, incomplete information in those files and not replacing a key claims official, the review found.

-- From News Services

and Staff Reports