THE HILL: 12/31/12 06:23 PM ET  Senate Republican Leader Mitch McConnell (R-Ky.) has told GOP colleagues that negotiators have agreed to postpone the automatic spending cuts known as the sequester for two months.

The agreement could pave the way for Senate passage of legislation to avoid the biggest parts of the so-called “fiscal cliff.” But it still needs to be approved by the Senate Democratic caucus, whose members are grumbling about the details…

McConnell announced on the Senate floor earlier in the day that he and Vice President Biden had agreed to the tax portion of the fiscal cliff. That part of the package would extend income tax rates for individual income up to $400,000 and family income up to $450,000. It would set the estate tax rate at 40 percent for inheritances over $5 million…  (more)

POLITICO:  Updated: 12/31/12 7:35 PM EST

Washington inched closer to a deal that would avert massive tax increases, but Congress will still fall short of passing legislation before a new year deadline, sending the country over the fiscal cliff at least temporarily as the two sides struggled to iron out final details.

Democrats are objecting to a two-month delay of automatic spending cuts poised to take effect in the year. The two parties have vowed to reverse the so-called sequester, but Republicans have demanded that the changes be offset with other spending reductions…

A vote in the Senate was possible late Monday night, but far from assured. House leaders are waiting for Senate action and will not vote before the new year…  (more)

Former Utah Gov. Jon Huntsman (R), who ran for the Republican presidential nomination in 2012, had harsh words for his party in an interview published Sunday in Britain’s Daily Telegraph.

“The party right now is a holding company that’s devoid of a soul and it will be filled up with ideas over time and leaders will take their proper place,” he said.

“We can’t be known as a party that’s fear-based and doesn’t believe in math,” he added. “In the end it will come down to a party that believes in opportunity for all our people, economic competitiveness and a strong dose of libertarianism.”…  (more)

To the Watchdog  who has had spent over half a century endeavoring to attract and please customers, the approach  of top management of the Lancaster Newspapers, Inc. to  its subscribers  is indeed a ‘puzzlement.’

The latest example is the placing of 3” x 3” advertising stickers over lead front page articles.

We understand advertisements offset much of the costs of a newspaper.   But we purchase the newspaper for the prospect of reading it.   We resent being  forced to remove a sticker in order to do so.

These impositions in disregard of customer expectations will serve to hasten the day when circulation drops to the point that publication will no longer be sustainable.

Message to LNP management:  Subscribers are customers, not supplicants.   Treat them fairly.

HUFFINGTON POST:   President Barack Obama has signed into law a five-year extension of the U.S. government’s authority to monitor the overseas activity of suspected foreign spies and terrorists…

Known as the Foreign Intelligence Surveillance Act, the law allows the government to monitor overseas phone calls and emails without obtaining a court order for each intercept.

The law does not apply to Americans. When Americans are targeted for surveillance, the government must get a warrant from a special 11-judge court of U.S. district judges appointed by the Supreme Court… (more)

PITTSBURGH POST-GAZETTE:  The incessant, as yet-to-be-answered questions regarding Bill O’Brien’s future at Penn State were thrust back into the forefront Sunday, with ESPN’s Chris Mortensen reporting that O’Brien was likely on some NFL teams’ short lists, including the Cleveland Browns and Philadelphia Eagles….

If any team, college or pro, wants to hire O’Brien it will be forced to pay a significant buyout. His contract states that if O’Brien terminates his contract with Penn State for any reason other than by death, disability or incapacity, the damages would equal his base salary ($950,000 for last year with an increase of five percent each year) and additional compensation ($1,350,000 annually) multiplied by the years remaining on his contract.

Under those terms, a buyout would equal $9.2 million if applied to the original duration of his five year contract. But because his contract was automatically extended another four years because of the NCAA sanctions, the buyout amount could be doubled to $18.4 million…  (more)

DAILY BEAST Column:

…1. President Obama
Wish list: Higher taxes on the wealthy, stimulus spending, limited cuts to entitlements

Worries of a “fiscal cliff” got a whole lot more real after the Nov. 6 election, which promised the return of divided government. Acutely aware of this, the newly re-elected president began publicly advocating the need for higher taxes on the wealthy as a cornerstone of any deal, offering his first official proposal to House Speaker John Boehner on Nov. 29th. His package called for $1.6 trillion in new tax revenue over 10 years by continuing Bush-era rates for all but the wealthiest Americans; a $50 billion stimulus program; and new executive power to raise the federal debt limit without congressional approval. It was swiftly denied. Epitomizing the budget talks, his next offer was received with equal contempt. That time, the proposal was a compromise for the Democratic president—an agreement to raise the income threshold on higher rates to $400,000 (up from $250,000).

2. House Speaker John Boehner
Wish list: Limited tax increases; keeping his job

As House Speaker, the fiscal-cliff crisis is in many ways John Boehner’s cross to bear. And bear it he has. Pleasing a fractious Republican caucus, the majority of whom signed Grover Norquist’s “no new taxes” pledge, is no easy feat, especially if Boehner wants to keep his leadership position in the new Congress. After staunchly rejecting Obama’s initial offer in late November, Boehner presented one of his own on Dec. 3rd. That package called for $800 billion in new tax revenue over 10 years, to be generated through unspecified changes to the tax code (about half of what Obama proposed), and $600 billion in cuts to health-care programs, including Medicare. The White House quickly rejected the offer, claiming that it did not “meet the test of balance.” After a few days of talking and finger-pointing in mid-December, Boehner came back with what many considered a triumphant compromise:“Plan B.” That proposal presented tax-rate increases only on those making over $1 million per year, protecting the other current tax rates. But in a turn of events that ultimately exposed his own vulnerability as speaker, Boehner was unable to garner enough votes from his tax-weary party to pass the compromise. Embarrassingly, he had to yank the bill from the House floor at the last minute.

3. Senate Majority Leader Harry Reid
Wish list: Extending Bush-era tax cuts for households making less than $250,000

After Obama and Boehner’s efforts ended in stalemate, an exasperated president called on the two leaders of the Senate to create a bipartisan package that, with any luck, will help the nation successfully avert the fiscal cliff. At the least, Obama said, he deserved an up-or-down vote on something. That something, if Reid, the Senate’s top Democrat, gets his wish, will be simple, clean, and look very much like what Obama himself would have drawn. Reid’s bill would most definitely extend the Bush-era tax cuts for households making less than $250,000 a year, and would likely include spending cuts to offset the change. Last week, an openly pessimistic Reid proclaimed this the “only viable escape route” to avoid tumbling over the cliff. But with many of his fellow Democrats looking to be reelected in 2014 (and many in red states), Reid has another agenda as well: keeping everyone happy…  (more)

NEWSMAX:   Farm-state lawmakers have agreed to a one-year extension of the expiring farm law that, if enacted, would head off a possible doubling of retail milk prices to $7 or more a gallon in early 2013.

The extension would end a 32-month attempt to update farm subsidies dating from the Depression era, when farmers were crushed by low prices and huge crop surpluses, to meet today’s high-wire challenges of tight food supplies, high operating costs and volatile markets.

House Agriculture Committee Chairman Frank Lucas, an Oklahoma Republican, said on Sunday he hoped the legislation would be passed by Congress and signed by President Barack Obama by Tuesday to avoid higher prices for milk in grocery stores…  (more)

http://www.newsmax.com/US/milk-deal-farm-subsidies/2012/12/30/id/469479

By Dick Miller (Part One)

WE CONNECT DOTS: Landowners in west central PA started getting lease confirmation checks about six weeks before Christmas. The payments, averaging, about $3,500 per acre, granted a well drilling company permission to extract oil and/or natural gas from beneath.
Six-figure checks have been arriving to the homes of large landowners in northern Mercer County, sending recipients to local banks. A researcher and advisor to this blog believes 20,000 acres in this region may have been leased, triggering $60-70 million in bonus payments.

Drilling and extraction of the natural gas must overcome another set of hurdles, however.
Wells being drilled now will continue to be classified as exploratory. Full extraction is not possible until pipelines are in place to deliver the gas to a collection point or (hopefully, eventually) a processing plant that Shell might build in Beaver County. This is where the gas could be processed in 2016 into various products including resin to make plastic items.
The first step to wealth for landowners, currently underway, is signing of a lease for mineral rights. New technology permits drillers to bore vertically a mile and beyond. Then they drill ninety-degree angled out horizontally in another direction.
This has laid bare huge quantities of natural gas in an area comprised of southwestern New York, Western PA, Eastern Ohio and northern West Virginia. The Marcellus Shale cache of natural gas is a bit over a mile down and an even richer accumulation may lie below that in an area known as the Utica Shale.

Facts are difficult to come by. The drillers are large corporations with legions of lawyers and communication specialists. Information is released only when the drillers deem it necessary to advance their interests.
The media in West Central PA asks no questions. Three newspapers owned by Alabama-based CNHI have ignored events that are part of the natural gas drilling story. Reportedly, a meeting several months ago, attended by several hundred land owners at a midway point between two of the papers was covered by neither. Both newspapers have strict limitations on overtime due to CNHI’s ongoing cash problems.

Landowners, hungry for information, have turned to a web site, www.gomarcellusshale.com. Lawyer Keith Mauck controls the site through his American Energy Communications, LLC. He also publishes three other websites that present data on other shale formations around the country.
He claims “an online grassroots network of over 75,000 people who are dedicated to safe and responsible exploration and production of domestic shale gas and shale oil.” Mr. Mauck believes (his network) is “central to easing our dependence on foreign oil.”

The Marcellus website is organized into county chapters in the four states where the formation is located. Pennsylvania and Ohio get the most attention because exploration efforts are most intense. Western PA counties and the number of website members are:
Butler (242), Mercer (210), Venango (154), Washington (147), Greene (126), Clarion (125), Beaver (124), Crawford (105), Westmoreland (99), Fayette (87), Warren (8) and Lawrence (0).
As a comparison, five counties with separate chapters in southern New York only have a combined membership of 111.

Finally, for this column, there is one more sub-story. The rent for two-bedroom apartments in Bradford County shot up from under $300 monthly to more than $1,000 in the period 2007-2011. Penn State researchers claim “natural gas drilling has generated more than $160 million in royalties for landowners in Bradford County.”
That was through 2011, but drilling activity in this New York border county has been scaled back in 2012. Natural gas prices plummeted to a ten-year low in April. Chesapeake is the dominant driller in Bradford County. Reporter Scott Detrow, of website StateImpactPA, wrote that Chesapeake began to “re-interpret” drilling leases. Chesapeake argued heretofore unreferenced contract language allows for further cost reductions.
In addition, the rich wet natural gas buried beneath northern Mercer County, coupled with Shell’s announcement to build a processing plant, began to attract more attention.

HUFFINGTON POST:   Secretary of State Hillary Rodham Clinton was admitted to a New York hospital Sunday after the discovery of a blood clot stemming from the concussion she sustained earlier this month.

Clinton’s doctors discovered the clot Sunday while performing a follow-up exam, her spokesman, Philippe Reines, said. He would not elaborate on the location of the clot but said Clinton is being treated with anti-coagulants and would remain at New York-Presbyterian Hospital for at least the next 48 hours so doctors can monitor the medication…

Clinton, 65, fell and suffered a concussion while at home alone in mid-December as she recovered from a stomach virus that left her severely dehydrated. The concussion was diagnosed Dec. 13 and Clinton was forced to cancel a trip to North Africa and the Middle East that had been planned for the next week…  (more)