The Lede Blog: Updates From the Senate Hearing

The Lede is following testimony on Wednesday before the Senate Judiciary Committee’s hearing titled “What Should America Do About Gun Violence?” Former Representative Gabrielle Giffords of Arizona, her husband, Mark E. Kelly, and Wayne LaPierre, chief executive of the National Rifle Association, are among the witnesses expected to testify. As our colleague Jennifer Steinhauer reports, this is the first hearing since the Dec. 14 mass shooting at an elementary school in Newtown, Conn., that killed 20 schoolchildren and 6 staff members.

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RIM changes name, unveils BlackBerry 10 in comeback bid

NEW YORK (Reuters) - Research In Motion Ltd unveiled on Wednesday the long-delayed line of smartphones it hopes will put the company on the comeback trail in a market it once dominated, but said sales of the BlackBerry 10 in the United States will not start until March.

Signaling his hopes for a fresh start for the company that pioneered on-your-hip email, Chief Executive Thorsten Heins also said RIM was abandoning the name it has used since its inception in 1985 to take on the name of its signature product.

"From this point forward, RIM becomes BlackBerry." Heins said at the New York launch. "It is one brand; it is one promise."

RIM launched its first BlackBerry back in 1999 as a way for busy executives to stay in touch with their clients and their offices, and the Canadian company quickly cornered the market for secure corporate and government email.

But its star faded as competition rose. The BlackBerry is now a far-behind also-ran in the race for market share, with a 3.4 percent global showing in the fourth quarter, down from 20 percent three years before. Its North American market share is even worse: a mere 2 percent in the fourth quarter.

RIM said the first of the new BlackBerrys will be available on Thursday in Britain, with other countries following as carriers complete their testing.

In the U.S. market, which sets trends that other countries follow, the BlackBerry Z10 touchscreen device will go on sale in March. U.S. carrier Verizon Wireless said the phone would cost $199 for a two-year contract, while Canada's Rogers Communications is quoting C$149 ($150) for certain three-year plans.

SHARES SLUMP

RIM shares initially rallied on Wednesday, but soon fell as much as 8 percent below Tuesday's close. The stock is down 90 percent from its 2008 peak as the BlackBerry has lost ground to rival devices. But in the last four months its volatile shares have more than doubled as buzz grew about the new devices.

"It was such a well-advertised launch date that people moved the stock up and then they took profits ahead of when it was going to be revealed," said Ian Nakamoto, director of research at Macdougall, Macdougall and Mactier in Toronto.

"For RIM, it's a normal stock market day. It would have been an abnormal stock market day if it had got cut in half or something."

The legal name change to BlackBerry from Research In Motion takes affect after shareholders approve the decision, but the company already plans to do business under the BlackBerry name.

"We want our employees to say, 'I work for BlackBerry.' Our customers to say, 'I own a BlackBerry.' Our shareholders to say, 'I own BlackBerry stock,'" said chief marketing officer Frank Boulben. "We want to become what I'd call a branded house versus a house of brands."

The new BlackBerry 10 phones will compete with Apple's iPhone and devices using Google's Android technology, both of which have soared above the BlackBerry in a competitive market.

The BlackBerry 10 devices boast fast browsers, new features, smart cameras and, unlike previous BlackBerry models, enter the market primed with a large application library, including services such as Skype and the popular game Angry Birds.

The new devices are sleek black numbers, one with the small "qwerty" keyboard that RIM made into its trademark, and one a pure touchscreen device that looks much like those its competitors already produce.

"QWERTY" DEVICE IN APRIL

The Q10 "qwerty" device will launch later than the Z10 touchscreen. Heins said it would hit global markets in April.

RIM picked a range of venues for its global launch parties, including Dubai's $650-a-night Armani Hotel, which occupies six floors of the Burj Khalifa, the world's tallest tower.

The New York event took place in a sprawling basketball facility on the Lower East Side of Manhattan, just north of the Manhattan Bridge. The Blackberry has been "Re-designed. Re-engineered. Re-invented," RIM said.

RIM, which is splurging on a Superbowl ad to promote its new phones, also introduced Grammy-winning singer/songwriter Alicia Keys as its global creative director.

"I was in a long-term relationship with BlackBerry, and then I started to notice some new, kind of hotter, attractive, sexier phones at the gym, and I kind of broke up with you for something that had a little more bling," Keys said at the New York launch.

"But I always missed the way you organized my life, and the way you were there for me at my job, and so I started to have two phones - I was kind of playing the field. But then ... you added a lot more features ... and now, we're exclusively dating again, and I'm very happy."

(Writing by Janet Guttsman; Editing by Frank McGurty, Lisa Von Ahn and Peter Galloway)

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Lindsay Lohan appears in court, trial delayed

LOS ANGELES (AP) — A judge has delayed Lindsay Lohan's trial on three misdemeanor counts filed after a June car crash.

Lohan appeared in court wearing a black dress and spoke only to confirm that she was changing her attorney.

Superior Court Judge Stephanie Sautner shook her head when she saw Lohan in her courtroom less than a year after warning the actress to stay out of trouble.

Sautner set a March 18 trial date and a March 1 hearing that Lohan is not required to attend.

Sautner previously sentenced Lohan to jail and house arrest in another case.

However, Sautner is retiring soon and another judge will hear the upcoming trial and any related motions.

Lohan has pleaded not guilty to lying to police, reckless driving and obstructing officers from performing their duties.

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SciTimes Update: Recent Developments in Health and Science News

Charles A. Nelson Lab, University of Minnesota

Studying the infant brain. From the book:  "Raising America: Experts, Parents and a Century of Advice About Children" by Ann Hulbert.

Wednesday in Science, babies who know what’s on your mind, a sinkhole in China, coral reefs in crisis and a soldier who can now talk with his hands. Check out these and other headlines from around the Web.

Baby Mind Readers: Even babies as young as 1 ½ can guess what other people are thinking, LiveScience.com reports. Previously, scientists thought this ability to understand other people’s perspectives emerged much later in children.

Time Wasters: An explosion in technology aimed at helping people manage their time and tasks may actually be making it harder, reports The Wall Street Journal. Many people choose something that doesn’t fit the way they think and work, or they jump from one tool to another, wasting time and energy.

More Housework, Less Sex: Married men who spend more time doing traditionally female chores, like cooking, cleaning and shopping, report having less sex than husbands who don’t do as much, reports The Houston Chronicle. Conversely, men who did more manly chores, such as yard work, paying bills and auto repairs, reported having more sex.

Roman Tag Artists: A facelift of the Colosseum in Rome that began last fall has revealed centuries of graffiti, National Geographic reports.

Sinkhole Swallows Building: An enormous sinkhole opened up under a building complex in China’s southern city of Guangzhou Tuesday, swallowing five shops and one building. Watch the video from The Christian Science Monitor.

Sandwiched Generation: More middle-aged adults are caring for both children and aging parents, reports USA Today. About 15 percent of American adults in their 40s and 50s provided financial support to both an aging parent and a child in 2012, according to a survey of 2,511 adults from the Pew Social and Demographic Trends Project.

Misleading Trials: A rare peek into drug company documents reveals troubling differences between publicly available information and materials the company holds close to its chest, reports ScienceNews.org. In comparing public and private descriptions of drug trials conducted by the pharmaceutical giant Pfizer, researchers discovered discrepancies,including changes in the number of study participants and inconsistent definitions of protocols and analyses.

Reuters

A diver swam past a healthy colony of Caribbean elkhorn coral near Molasses Reef, Florida, in 2009.

Coral in Crisis: Coral reefs are producing less calcium carbonate and growth rates have slowed dramatically, reports Science News.

Severe Flu Cases Among Chinese: A genetic variant commonly found in Chinese people may help explain why some got seriously ill with swine flu, reports The Boston Globe. The discovery could help pinpoint why flu viruses hit some populations particularly hard and change how they are treated.

Video by AssociatedPress

Double-Arm Transplant Recipient: Feels Amazing

Double-Arm Transplant Soldier Speaks: Brendan Marrocco, a soldier who lost all four limbs in Iraq and then received a double-arm transplant said he hated living without arms. “Not having arms takes so much away from you. Even your personality, you know. You talk with your hands. You do everything with your hands, and when you don’t have that, you’re kind of lost for a while,” the 26-year-old New Yorker told reporters Tuesday at Johns Hopkins Hospital, reports The Associated Press.

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Today's Economist: Casey B. Mulligan: The Health Care Law and Retirement Savings

Casey B. Mulligan is an economics professor at the University of Chicago. He is the author of “The Redistribution Recession: How Labor Market Distortions Contracted the Economy.”

Because of its definition of affordability, beginning next year the Affordable Care Act may affect retirement savings.

Employer contributions to employee pension plans are exempt from payroll and personal income taxes at the time that they are made, because the employer contributions are not officially considered part of the employee’s wages or salary (employer health insurance contributions are treated much the same way). The contributions are taxed when withdrawn (typically when the worker has retired), at a rate determined by the retiree’s personal income tax situation.

Employees are sometimes advised to save for retirement in this way in part because the interest, dividends and capital gains accrue without repeated taxation. In addition, people sometimes expect their tax brackets to be lower when retired than they are when they are working.

These well-understood tax benefits of pension plans will change a year from now if the act is implemented as planned. Under the act, wages and salaries of people receiving health insurance in the law’s new “insurance exchanges” will be subject to an additional implicit tax, because wages and salaries will determine how much a person has to pay for health insurance.

While much about the Affordable Care Act is still being digested by economists, they have long recognized that high marginal tax rates lead to fringe benefit creation. And the Congressional Budget Office has concluded that the act will raise marginal tax rates.

Were an employer to reduce wages and salaries (or fail to increase them) and compensate employees by introducing an employer-matching pension plan, the employee is likely to benefit by receiving additional government assistance with his health-insurance costs. The pension contributions will add to the worker’s income during retirement, except that the income of elderly people does not determine health-insurance eligibility to the same degree, because the elderly participate in Medicare, most of which is not means-tested.

Take, for example, a person whose four-member household would earn $95,000 a year if his employer were not making contributions to a pension plan or did not offer one. He would be ineligible for any premium assistance under the Affordable Care Act because his family income would be considered to be about 400 percent of the poverty line.

If instead the employer made a $4,000 contribution to a pension plan and reduced the employee’s salary so that household income was $91,000, the employee would save the personal income and payroll tax on the $4,000 and would become eligible for about $2,600 worth of health-insurance premium assistance under the act. (The employer would come out ahead here, too, by reducing its payroll tax obligations).

Even though the Affordable Care Act is known as a health-insurance law, in effect it could be paying for a large portion of employer contributions to pension plans. This has the potential of changing retirement savings and the relative living standards of older and working-age people.

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Bloomberg Calls for Spending Limits, but No Tax Increases

Despite the prospect of losing hundreds of millions of dollars in state funding for education, continuing labor-contract disputes and the cost of rebuilding after Hurricane Sandy, Mayor Michael R. Bloomberg said on Tuesday that there would be no tax increases even as he called for agencies across the city to find savings.

He cited the improving national economy, the recovery on Wall Street and the city’s increasingly diversified economy as reasons the city was in decent financial shape.

In his final budget proposal after 11 years in office, Mr. Bloomberg said that New York schools could be hit the hardest, mainly as a result of the failure to reach an agreement with the teachers’ union over an evaluation system.

“We expect our schools to take a $250 million hit in the current fiscal year,” Mr. Bloomberg said. That would mean that there would be hundreds of fewer teachers, mainly through attrition.

While noting the many challenges the city faces, he said the city’s $70.1 billion budget would protect all vital services even as individual agencies worked to keep their spending in check.

“The financial plan presented today continues to protect critical services and foster economic growth, while also taking the responsible, budget-minded actions that have resulted in a more efficient city government,” Mr. Bloomberg said.

Hurricane Sandy has cost the city $4.5 billion in emergency services and damage to public infrastructure, he said.

“We do expect that all of those costs will be covered by federal funding,” he said.

The mayor’s budget outline marks the starting point for what will most likely be months of negotiations with city lawmakers before the official start of the fiscal year on July 1.

By law, the mayor and the City Council must agree on a balanced budget each fiscal year.

Mr. Bloomberg said that the loss of education money would have an impact on schools across the city.

To make up for the lost money, the city would keep 700 fewer teachers on the payroll, with staff reductions coming mainly through attrition, “as well as the reduction of funds for extracurricular activities and after-school programming,” according to a budget summary provided by the administration.

“The cuts would have a direct and dire impact on classrooms across the city and will be borne by the students who need and deserve high-quality education,” according to the statement.

In outlining his budget, Mr. Bloomberg noted the city’s continued commitment to education, saying that the $13.9 billion budget for education he proposed on Tuesday was $8 billion more than when he took office.

Mr. Bloomberg said that while there would be no tax increases, he expected tax revenues to be $222 million greater than initial projections.

“I am reasonably optimistic that we will have a small increase in our tax revenues,” he said.

But the budget also relies heavily on the cost-cutting measures put in place by city agencies, which he said will result in $6.5 billion in savings in 2014.

Administration officials had already warned city agencies about the likelihood of deep cuts, projecting a steep budget shortfall.

Mr. Bloomberg reiterated his warnings of coming fiscal pain during testimony in Albany on Monday, when he urged the State Legislature to intervene so that the city did not lose hundreds of millions of dollars because it missed a deadline this month to finish negotiating a teacher evaluation system.

He had also hinted, more broadly, of belt-tightening in November, when he unveiled a plan to cope with a budget shortfall for the rest of the current fiscal year, which ends on June 30.

He noted that because his plan to sell 2,000 new yellow-taxi medallions was still tied up in the courts, and up in the air, and because any additional costs related to Hurricane Sandy had not yet been determined, he felt that he had to slash a slew of programs.

While there was talk in the administration about an increase in school lunch fees to $2.50 from $1.50 — which would have netted the city an extra $4.4 million — the plan was not included in Tuesday’s budget address.

The idea was torpedoed by Christine C. Quinn, the City Council speaker, according to city officials.

The mayor’s proposed budget could change significantly after wrangling with lawmakers.

Last year, for instance, additional money that poured into the city’s coffers enabled the city to avoid cutting child-care and after-school programs, and to keep open firehouses.

But this year’s budget “sidesteps some crucial issues,” according to the city’s Independent Budget Office, like uncertain education funding, Medicaid reimbursements, taxi revenues and expired labor contracts.

“While projected budget gaps may currently appear modest — certainly when compared with gaps faced in some recent years — the next mayor and City Council are likely to face significant budget challenges,” the budget office concluded.

When Mr. Bloomberg took office, he inherited a $4.8 billion deficit in a $42.3 billion budget.

Mr. Bloomberg vowed that he would not pass along a similar debt to his successor, making a habit of stashing away extra revenue in years when the city ran a budget surplus.

“I’m determined that when I leave the city, we won’t have, my successor, the first year in office, won’t have enormous deficits to deal with,” Mr. Bloomberg said in 2007.

Despite the challenges the city faces, Mr. Bloomberg said he was determined to keep the budget balanced while not cutting essential services.

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Apple announces iPad with double storage capacity

(Reuters) - Apple Inc said on Tuesday that it will sell a version of its iPad tablet computer with 128 gigabytes of storage, which is twice the capacity of its existing models.

Apple, which has sold more than 120 million iPads so far, said that the new iPad will go on sale February 5, in black or white, for a suggested retail price of $799 for the iPad with just Wi-Fi model, and $929 for the version that also has a cellular wireless connection.

(Reporting By Sinead Carew; Editing by Gerald E. McCormick)

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Chris Cuomo leaving ABC News for CNN

NEW YORK (AP) — Chris Cuomo is leaving ABC News to host a new morning show at CNN, where new boss Jeff Zucker is moving fast to try to turn around the cable news pioneer that has fallen on hard times.

Network managing editor Mark Whitaker announced he was quitting Tuesday, officially Zucker's seventh day on the job as CNN Worldwide president. Longtime political consultants and commentators James Carville and Mary Matalin also are leaving.

Cuomo is expected to be paired with current evening anchor Erin Burnett in the mornings. CNN said Tuesday it was discussing other job options with Soledad O'Brien, who will be ending her second stint as morning show co-host.

"Chris is an accomplished anchor who is already an established name in morning television," Zucker said. "What I love about Chris is that he is passionate about every story he tells, never forgets about the viewer and represents the type of journalism that makes CNN great."

In addition to the broadcast morning shows, CNN is competing with two distinctive cable news morning programs in Fox News Channel's "Fox & Friends" and MSNBC's "Morning Joe."

Zucker was the "Today" show executive producer as the show began dominating morning television in the mid-1990s, before moving up in the NBC executive suite, and he is expected to work closely in developing the new morning show. He was largely responsible for Matt Lauer and Meredith Vieira getting their jobs at "Today."

Cuomo, the "20/20" co-anchor, is the second big defection from ABC to CNN in a little more than a month, the other being Jake Tapper.

Both men found their paths to higher-profile jobs at ABC blocked. Cuomo, who was news anchor at "Good Morning America" from 2006 to 2009, was passed over for George Stephanopoulos as co-host of that show while Tapper twice didn't get a shot at the anchor job on "This Week," first when Stephanopoulos left and then when he returned to the Sunday show.

Both Cuomo and Tapper will have their own daily programs on CNN, which generally runs third in the ratings behind Fox and MSNBC but improves during big news events.

Cuomo wasn't made available for comment. He said in a statement that "this is a fantastic opportunity to do what I value the most and hopefully to do the work that I do best."

CNN was scooped on the announcement of Cuomo's hiring by the newsman's older brother, New York Gov. Andrew Cuomo, who mentioned it during a radio interview Tuesday morning.

ABC News moved quickly to replace Cuomo, appointing correspondent David Muir as Elizabeth Vargas' new co-host on the prime-time newsmagazine.

Whitaker came to CNN in 2011 as senior vice president and managing editor and tried to expand CNN's programming, opening a film division and hiring Morgan Spurlock and Anthony Bourdain for weekend shows that haven't started yet.

With Zucker and "his own forceful ideas" about CNN's direction and programming options, Whitaker said the new chief deserved a chance to build his own management team.

The Cajun commentator Carville, a former Bill Clinton political aide, has delivered opinions on CNN since 2002. His wife, Mary Matalin, came on at the end of the Bush administration in 2009.

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Associated Press writer Michael Gormley in Albany, N.Y. contributed to this report.

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Well: Ask Well: Long-Term Use of Nicotine Gum

In small doses, like those contained in the gum, nicotine is generally considered safe. But it does have stimulant properties that can raise blood pressure, increase heart rate and constrict blood vessels. One large report from 2010 found that compared to people given a placebo, those who used nicotine replacement therapies had a higher risk of heart palpitations and chest pains.

That’s one reason that nicotine gum should, ideally, be used for no more than four to six months, said Lauren Indorf, a nurse practitioner with the Cleveland Clinic’s Tobacco Treatment Center. Yet up to 10 percent of people use it for longer periods, in some cases for a decade or more she said.

Some research has raised speculation that long-term use of nicotine might also raise the risk of cancer, though it has mostly involved laboratory and animal research, and there have not been any long-term randomized studies specifically addressing this question in people. One recent report that reviewed the evidence on nicotine replacement therapy and cancer concluded that, “the risk, if any, seems small compared with continued smoking.”

Ultimately, the biggest problem with using nicotine gum for long periods is that the longer you stay on it, the longer you remain dependent on nicotine, and thus the greater your odds of a smoking relapse, said Ms. Indorf. “What if the gum is not available one day?” she said. “Your body is still relying on nicotine.”

If you find yourself using it for longer than six months, it may be time to consider switching to sugar-free gum or even another replacement therapy, like the patch or nasal spray.

“Getting people on a different regimen helps them break the gum habit and can help taper them off nicotine,” Ms. Indorf said.

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DealBook: Gleacher to Leave His Investment Bank

9:32 a.m. | Updated with interview with Mr. Gleacher

Eric J. Gleacher, a veteran deal maker who participated in the fight over RJR Nabisco, said on Tuesday that he would leave the investment bank he founded about 23 years ago.

The departure of Mr. Gleacher as chairman comes months after his struggling firm hired Credit Suisse to explore a sale.

Gleacher & Company disclosed last month that the Nasdaq stock market had initiated a move to delist the investment bank, after its stock price lingered below $1 for months. The firm is appealing the decision.

Mr. Gleacher, 72, told DealBook in an interview on Tuesday that his decision was prompted in part by finishing work on the sale of Archstone, a massive real estate company once owned by Lehman Brothers. Since the deal was announced in late November, he has been approached by a number of companies seeking advice, and he is weighing opportunities to essentially become a freelance adviser.

“As the business model on Wall Street changes, I’m looking forward to working with C.E.O.’s and investors in helping them realize their goals,” he said. “I’m looking forward to doing so in an independent manner.”

(He has been contemplating a move for some time, having put up his Manhattan town house for sale earlier this month.)

Mr. Gleacher, a former Marine and long one of Wall Street’s top golfers, founded his company after having become one of the top deals bankers on Wall Street during the 1980s. He founded the mergers department at Lehman Brothers in 1978, and then led Morgan Stanley‘s deal team from 1985 to 1990.

He then founded his firm, maintaining it for years as an independent merger advisory shop. He sold it to the British bank Natwest in 1995, but bought it back four years later.

Mr. Gleacher and his partners decided in 2009 to sell their business to Broadpoint Securities, a small brokerage, giving rise to the current Gleacher & Company. But the firm struggled, burdened with rising regulatory constraints and tepid deal activity.

Under Thomas Hughes, Gleacher & Company’s chief executive, the investment bank has sold off businesses in an attempt to revive its flagging fortunes. In the fall, the firm explored a potential sale to a larger concern, Stifel Financial, but the talks fell apart over price, according to people briefed on the matter.

It is unclear whether the investment bank is still pursuing a sale. Mr. Hughes suggested in a statement that the firm continued to weigh its options.

“We will continue to grow our M.&A. and capital-raising capabilities in line with the vision we have described previously, a vision that Eric helped author,” Mr. Hughes said. “On behalf of the company, I want to wish Eric the best in his future endeavors.”

While striking off on his own will allow him more personal time, Mr. Gleacher added that he intended to keep busy.

“To me, retirement is just time allocation,” he said. “I’ve always just enjoyed what I’ve done.”

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