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Paulson, speaking on the steps of the Treasury facing the White House, asked Congress for authority to buy unlimited stakes in and lend to the companies, aiming to stem a collapse in confidence. The Federal Reserve separately authorized the firms to borrow directly from the central bank.

The announcement followed crisis talks between the firms, government officials, lawmakers and regulators, after Fannie Mae and Freddie Mac lost about half their value last week. Paulson and Fed Chairman Ben S. Bernanke are trying to prevent a collapse in the companies that would exacerbate the worst housing recession in 25 years and deepen the economic slowdown.

Paulson’s proposal, which the Treasury anticipates will be incorporated into an existing congressional bill and approved this week, signals a shift toward an explicit guarantee of Fannie Mae and Freddie Mac debt. The two shareholder-owned companies are government-sponsored enterprises, giving investors the indication of an implicit federal backing.

Making `Explicit’

“It is time to recognize that the GSEs were always dependent upon government support and now we must make the implicit explicit,” said Christopher Whalen, co-founder of independent research firm Institutional Risk Analytics in Torrance, California.

Paulson proposed that Congress enact legislation giving the Treasury temporary authority to buy equity “if needed” in the firms, and to increase their lines of credit with the department from $2.25 billion each. The temporary authority may be for 18 months, a Treasury official told reporters on a conference call on condition of anonymity.

As lenders retreated from the housing market, Washington- based Fannie Mae and McLean, Virginia-based Freddie Mac have grown to account for more than 80 percent of the home loans packaged into securities.

Freddie Mac is scheduled to sell $3 billion in short-term notes tomorrow, and Paulson’s comments indicate a concern about a collapse in private investors’ willingness to fund the firms. The companies issue debt to raise money for their purchases of mortgage securities.

Bond Sale

As of now, no actual legislation has been drawn up, but the AMA has agreed to back a measure called “Resolution 205,” a request to support the American College of Obstetricians and Gynecologists’ (ACOG) position that home births are not safe.

“We are against home births, period,” said Gregory Phillips, an ACOG spokesman.

Women who give birth outside of a clinical setting risk putting themselves and their newborns at risk, Phillips told ABCNEWS.com.

In an e-mail to ABCNEWS.com, AMA board member Steven Stack, MD, wrote that the AMA “stresses that the safest setting for delivering a baby is in the hospital or a birthing center within a hospital complex.”

The influential medical groups — AMA and ACOG — now find themselves at odds with those who say women should have the choice to give birth at home or in a hospital.

The American College of Nurse-Midwives has issued an unequivocal statement in support of planned home births, citing a study in the British Medical Journal that showed home births to be no riskier than hospital births.

Freddie Scappaticci was exposed by the Sunday Herald in May 2003 as the infamous double agent codenamed Stakeknife. The Sunday Herald has now uncovered how Scappaticci has made millions in a taxpayer-funded resettlement package which was put in place after his cover was blown.

As well as the huge financial deal, Scappaticci has also been given a new home, a new job, a new identity and a new face, thanks to plastic surgery. It is thought he is the only spy who operated in Ireland to be given facial surgery as part of a resettlement deal.

Scappaticci was an informer for the army’s Force Research Unit (FRU), a shadowy wing of military intelligence, which used terrorists on both sides of the divide in Northern Ireland as proxy assassins. The FRU allowed paramilitaries, who they were running as agents, to carry out bombings and shootings in order to preserve their cover and keep passing high grade information to their army handlers.

A FRU officer who ran Stakeknife as an agent told the Sunday Herald that Scappaticci had been allowed to take part in murders in order to maintain his cover as a high-ranking IRA officer. In total, the FRU handler said, the running of Stakeknife may have cost up to 40 lives.

Both human rights groups and former British Army intelligence officers who took part in the fight against terrorism in Ulster, but have since rejected many of the tactics used by the military, say Scappaticci should be interviewed by the police as a failure to do so undermines British justice.

To underscore just how valued Scappaticci is by British intelligence, the Sunday Herald was threatened with a court gagging order when MI5 was alerted that the paper planned to tell readers about Scappaticci’s new life.

…

A former FRU officer said: “Freddie has been given a new face as he needs personal security. The state has no desire to ever allow Freddie to be put in the position where he has to explain himself.

“You have to remember that he will never have a normal life. The state does owe him this protection as he acted on behalf of the state and under the direction of the military for 25 years as a public executioner.”

The FRU officer estimated that Scappaticci was now a “millionaire many times over”. As well as bringing in an estimated £80,000 a year while working as a spy, his resettlement package would have been worth a small fortune.

In addition, the FRU source said he believed there was little real will by the government to go down the path of seeking truth and reconciliation in Ulster because of what skeletons it would bring out of the cupboard.

“The British state will not allow him to be interviewed by anyone as it would implicate the state. Can you imagine the financial consequences of up to 40 widows suing the state? It’s never going to be allowed to happen.

Annual accounts published this week show the Holy See fell into the red last year, recording a loss of €9.1m (£7.25m).

The US currency has fallen sharply against the euro since the start of last year, hitting the Holy See in the pocket as its expenses are incurred in euros. Much of the Vatican’s income comes from donations by Catholics around the world. The US was the largest single contributor to Peter’s Pence – the collection used by the Pope for charitable donations – sending almost $19m (£9.5m).

But the shortfall attributed mainly to the weak dollar was mitigated by a rise of €4m in property income. The Holy See is a major owner of property all over Rome and was criticised last year for raising rents and threatening to evict tenants.

Earlier this year, the Vatican released a new list of mortal sins which included “accumulating excessive wealth”.

Estimates of its own wealth vary, with some reports putting it at £4bn. Last year a political row broke out over the tax exemptions enjoyed by the Catholic church in Italy. Under a deal first hammered out in 1929, it does not pay property taxes.

With a yawning gap between the cost of Mexico’s state-subsidized fuel and record U.S. pump prices, tanker truck owners and people doing business on the border are filling up tanks or plastic barrels with Mexican fuel and selling it in the United States.

Gasoline in Mexico is around a third cheaper than in the United States. For diesel, prices are more than double — well over $4 a gallon in U.S. border states compared to just over $2 in Mexican border cities.

“It is true tanker trucks are coming from the United States to fill up with supplies in Mexico,” Mario Osuna, the head of Mexico’s consumer watchdog agency Profeco in Baja California state where Tijuana is the capital, said on Thursday.

“There is no way of sanctioning foreigners who come to Tijuana and buy gasoline to sell in their country,” Osuna told Reuters. “Mexico does not have regulations relating to that.”

Border residents who have spotted the price anomaly are jumping on the export bandwagon, taking containers of fuel over the border in pickup trucks to sell.

“We cannot deny that this type of small-scale contraband is going on,” said Joaquin Avina, president of the Association of Gas Stations of Tijuana, Tecate and Rosarito.

Police are now planning a severe crackdown on the crime wave. Lothian and Borders Police will tomorrow set up rolling road blocks in rural areas to stop traffic in the hope of catching thieves in transit. Strathclyde Police have launched a programme called Forecourt Watch to deal with the increasing numbers of drivers leaving petrol stations without paying.

Tayside Police are staking out rural areas late at night and stop every single vehicle spotted on the road after £14,000 of fuel thefts were recorded between March and June, with indications that criminals used a petrol tanker to syphon off the stolen fuel and carry it away.
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All Scottish forces have reported a dramatic rise in fuel theft. In Central Scotland Police’s jurisdiction, 5000 litres were stolen between January and March. Grampian Police have noticed a “concerning increase” in thefts, with five domestic storage tanks near Moray being robbed between March and June, and thousands of litres stolen from lorries left in an industrial park.

The thieves are so skilled that they are able to sneak into a car park and siphon the entire content of a lorry’s fuel tank whilst the driver sleeps in the cab.

They have also made widespread thefts of heating oil from domestic properties, and drained huge amounts of red diesel, an agricultural fuel, from storage tanks at farms, hauliers’ premises and industrial parks.

Stephen Payne, who claims to have raised more than $1m for the president’s Republican party in recent years, said he would arrange meetings with Dick Cheney, the vice-president, Condoleezza Rice, the secretary of state, and other senior officials in return for a payment of $250,000 (£126,000) towards the library in Texas.

Payne, who has accompanied Bush and Cheney on several foreign trips, also said he would try to secure a meeting with the president himself.

The revelation confirms long-held suspicions that favours are being offered in return for donations to the libraries which outgoing presidents set up to house their archives and safeguard their political legacies.

Unlike campaign donations, there is no requirement to disclose the donors to the libraries, no limit on the amount that can be pledged and no restrictions on foreigners contributing.

During an undercover investigation by The Sunday Times, Payne was asked to arrange meetings in Washington for an exiled former central Asian president. He outlined the cost of facilitating such access.

“The exact budget I will come up with, but it will be somewhere between $600,000 and $750,000, with about a third of it going directly to the Bush library,” said Payne, who sits on the US homeland security advisory council.

He said initially that the “family” of the Asian politician should make the donation. He later added that if all the money was paid to him he would make the payment to the Bush library. Publicly, it would appear to have been made in the politician’s name “unless he wants to be anonymous for some reason”.

Payne said the balance of the $750,000 would go to his own lobbying company, Worldwide Strategic Partners (WSP).

Asked by an undercover reporter who the politician would be able to meet for that price, Payne said: “Cheney’s possible, definitely the national security adviser [Stephen Hadley], definitely either Dr Rice or . . . I think a meeting with Dr Rice or the deputy secretary [John Negroponte] is possible . . .

“The main thing is that he [the Asian politician] comes, and he’s well received, that he meets with high-level people . . . and we send positive statements made back from the administration about ‘This guy wasn’t such a bad guy, many people have done worse’.”

Payne said that he would use the services of Mark Pritchard, a Conservative MP who chairs the House of Commons all-party Russia group and was last week on the brink of signing as a paid “adviser” to WSP. Pritchard issued a statement saying that he had not done any work for WSP.

When confronted, Payne said that there would be “no quid pro quo” for any donation and added that his firm was “always above board”.

For the past 18 months, immigration officials at border entries have been searching and seizing some citizens’ laptops, cellphones, and BlackBerry devices when they return from international trips.

In some cases, the officers go through the files while the traveler is standing there. In others, they take the device for several hours and download the hard drive’s content. After that, it’s unclear what happens to the data.

The Department of Homeland Security contends these searches and seizures of electronic files are vital to detecting terrorists and child pornographers. It also says it has the constitutional authority to do them without a warrant or probable cause.

But many people in the business community disagree, saying DHS is overstepping the Fourth Amendment bounds of permissible routine searches. Some are fighting for Congress to put limits on what can be searched and seized and what happens to the information that’s taken. The civil rights community says the laptop seizures are simply unconstitutional. They want DHS to stop the practice unless there’s at least reasonable suspicion.

Legal scholars say the issue raises the compelling and sometimes clashing interests of privacy rights and the need to protect the US from terrorists and child pornographers. The courts have long held that routine searches at the border are permissible, simply because they take place at the border. Opponents of the current policy say a laptop search is far from “routine.”

“A laptop can hold [the equivalent of] a major university’s library: It can contain your full life,” says Peter Swire, a professor of law at Ohio State University in Columbus. “The government’s never gotten to search your entire life, so this is unprecedented in scale what the government can get.”

In recent court challenges, lower courts have ruled that laptop searches at the border are reasonable, just like searches of a person’s baggage or other physical property. But the courts have drawn the line at personal, invasive searches, ruling that things like “strip searches, body-cavity searches, and involuntary X-ray searches” are nonroutine, according to Nathan Sales, a professor of law at George Mason University in Arlington, Va., who recently testified before Congress.

Thus, they require reasonable suspicion, probable cause, or a warrant.

Advocates of the current practice say that the contents of a laptop are like the contents of a suitcase, and as such, customs officials have every right to go through them. They also argue that requiring probable cause for laptop searches would create huge delays at the border and give criminals and terrorists an easy way to bring dangerous things into the country.

“The idea that we would create some kind of sanctuary for criminals and terrorists to carry things across the border to me is absolutely ludicrous,” says James Jay Carafano, a senior research fellow at the Heritage Foundation in Washington. “It’s also unrealistic to require probable cause when you think about the millions of people a day who come in and go out of the country.”

People who’ve had their laptops and other electronic devices searched and seized believe that it’s reasonable and constitutional to expect a higher level of suspicion before customs officials take their laptop.

Amir Khan, an information technology consultant from the San Francisco area, has had his laptop searched twice on returning to the US from business abroad. Once, a customs official took it away for more than two hours.

“I don’t know what he did with it. He could have planted malicious software or copied files,” Mr. Khan says. “It was very intrusive and I think unreasonable. The Fourth Amendment makes it clear you can’t just stop anybody in the street and start searching them and their things.”

Many people, particularly in the business community, also say that a laptop is more like a virtual office than a piece of baggage. In addition, they believe the government should be required to tell people what it does with the information it copies.

“Right now, [DHS] seems to believe that it can hold anything it wants from your laptop, BlackBerry, or cellphone indefinitely,” says Susan Gurley, executive director of the Association of Corporate Travel Executives in Alexandria, Va. “There are no limits on what they can do with it or whether they can share it with any third party.”

Ms. Gurley and others in the business community would like DHS to be required to come up with a set of rules that determine what can be done with the information and how long it can be held. Civil rights advocates would like to see Congress go even further and determine that a search of an electronic device is invasive and requires probable cause.

“We treat our laptops, BlackBerrys, and cellphones as an extension of our brains. They can contain our most intimate thoughts,” says Tim Sparapani, senior legislative counsel of the American Civil Liberties Union.

As for creating a “sanctuary” for terrorists to bring in lethal plans, Mr. Sparapani counters: “Any terrorist worth his or her salt would send that stuff in an encrypted file from a remote location to a remote server somewhere in the United States.”