Bond movie “Skyfall” beats “Lincoln” at box office

(Reuters) – James Bond showed remarkable staying power as the latest installment of the spy series, “Skyfall,” captured the box office title and collected $ 11 million in its fifth week in U.S. and Canadian movie theaters, outgunning Steven Spielberg‘s “Lincoln” and “The Twilight Saga: Breaking Dawn – Part 2,” the final installment of the blockbuster vampire series.

“Skyfall,” the 23rd film in the series featuring Agent 007, also led movies at the box office when it first opened on November 2 and is already the best-selling movie in the 49-year old series. This weekend, it became the highest grossing movie in Sony Pictures‘ history with $ 918 million in ticket sales worldwide. The film distributed by Sony‘s Hollywood studio, has collected nearly $ 262 million in domestic sales, according to the movie tracking site Hollywood.com.

The animated “Rise of the Guardians” from Dreamworks Animation was second with $ 10.5 million in ticket sales. The movie, which was made for $ 145 million, opened with a disappointing $ 23.8 million when it first hit movie theaters on November 21. Since then, it has been steadily working its way toward becoming a solid family hit this season.

“Rise of the Guardians, which features Santa Claus, the Easter Bunny and other childhood favorites who join together to save the world, was one of two family movies in a season traditionally heavy in family films. The other, Disney’s “Wreck-it Ralph,” collected $ 4.9 million for seventh place.

“Breaking Dawn – Part 2,” the box office leader for the past three weeks, tallied $ 9.2 million in ticket sales. The five-movie series, released by Lions Gate Entertainment, is based on Stephenie Meyer‘s best-selling book about young vampire love and has collected more than $ 1.3 billion in overall domestic ticket sales.

“Lincoln,” which chronicles the 16th president’s successful fight to pass a constitutional amendment outlawing slavery, had total ticket sales of $ 9.1 million, according to studio estimates provided by the box office division of Hollywood.com.

“Life of Pi,” director Ang Lee’s movie about a boy who escapes a shipwreck but then shares his lifeboat with a tiger, sold $ 8.3 million in tickets to finish in fifth place. The movie, released by the Fox studio, is based on a best-selling 2001 novel by Yann Martel.

Hollywood studios shied away from scheduling major movies this weekend, steering clear of the expected blockbuster “The Hobbit: An Unexpected Journey,” which Warner Brothers will release on December 14. The movie, based on the J.R.R. Tolkien fantasy novel about wizards and dwarves, features many of the same actors from the blockbuster “The Lord of the Rings” trilogy.

The only new major release, the romantic comedy “Playing for Keeps” starring Gerard Butler and Jessica Biel, opened with a lackluster $ 6 million, which was on target with forecasts by industry experts.

(Reporting by Ronald Grover and Andrea Burzynski; Editing by Bill Trott and Jackie Frank)

Movies News Headlines – Yahoo! News

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A Breakthrough Against Leukemia Using Altered T-Cells

PHILIPSBURG, Pa. — Emma Whitehead has been bounding around the house lately, practicing somersaults and rugby-style tumbles that make her parents wince.

It is hard to believe, but last spring Emma, then 6, was near death from leukemia. She had relapsed twice after chemotherapy, and doctors had run out of options.

Desperate to save her, her parents sought an experimental treatment at the Children’s Hospital of Philadelphia, one that had never before been tried in a child, or in anyone with the type of leukemia Emma had. The experiment, in April, used a disabled form of the AIDS virus to reprogram Emma’s immune system genetically to kill cancer cells.

The treatment very nearly killed her. But she emerged from it cancer-free, and seven months later is still in complete remission. She is the first child and one of the first humans ever in whom new techniques have achieved a long-sought goal — giving a patient’s own immune system the lasting ability to fight cancer.

Emma had been ill with acute lymphoblastic leukemia since 2010, when she was 5, her parents, Kari and Tom, said. She is their only child.

She is among just a dozen patients with advanced leukemia to have received the experimental treatment, which was developed at the University of Pennsylvania. Similar approaches are also being tried at other centers, including the National Cancer Institute and Memorial Sloan-Kettering Cancer Center in New York.

“Our goal is to have a cure, but we can’t say that word,” said Dr. Carl June, who leads the research team at the University of Pennsylvania. He hopes the new treatment will eventually replace bone-marrow transplantation, an even more arduous, risky and expensive procedure that is now the last hope when other treatments fail in leukemia and related diseases.

Three adults with chronic leukemia treated at the University of Pennsylvania have also had complete remissions, with no signs of disease; two of them have been well for more than two years, said Dr. David Porter. Four adults improved but did not have full remissions, and one was treated too recently to evaluate. A child improved and then relapsed. In two adults, the treatment did not work at all. The Pennsylvania researchers are presenting their results on Sunday and Monday in Atlanta at a meeting of the American Society of Hematology.

Despite the mixed results, cancer experts not involved with the research say it has tremendous promise, because even in this early phase of testing it has worked in seemingly hopeless cases.

“I think this is a major breakthrough,” said Dr. Ivan Borrello, a cancer expert and associate professor of medicine at the Johns Hopkins University School of Medicine.

Dr. John Wagner, director of pediatric blood and marrow transplantation at the University of Minnesota, called the Pennsylvania results “phenomenal,” and said they were “what we’ve all been working and hoping for but not seeing to this extent.”

A major drug company, Novartis, is betting on the Penn team, and has committed $20 million to building a research center on the Penn campus to bring the treatment to market.

Hervé Hoppenot, president of Novartis Oncology, called the research “fantastic” and said it had the potential — if the early results hold up — to revolutionize the treatment of leukemia and related blood cancers. Researchers say the same approach, reprogramming the patient’s immune system, may also be used eventually against tumors like breast and prostate cancer.

To perform the treatment, doctors remove millions of the patient’s T-cells — a type of white blood cell — and insert new genes that enable the T-cells to kill cancer cells. The new genes program the T-cells to attack B-cells, a normal part of the immune system that turns malignant in leukemia.

The altered T-cells — called chimeric antigen receptor cells — are then dripped back into the patient’s veins, and if all goes well they multiply like crazy and start destroying the cancer.

The T-cells home in on a protein called CD-19 that is found on the surface of most B-cells, whether they are healthy or malignant.

A sign that the treatment is working is that the patient becomes terribly ill, with raging fevers and chills — a reaction that oncologists call “shake and bake,” Dr. June said. Its medical name is cytokine-release syndrome, or cytokine storm, referring to the natural chemicals that pour out of cells in the immune system as they are being activated, causing fevers and other symptoms. The storm can also flood the lungs and cause perilous drops in blood pressure — effects that nearly killed Emma.

Steroids sometimes ease the reaction, but did not help Emma. Her temperature hit 105. She wound up on a ventilator, unconscious and swollen almost beyond recognition, surrounded by friends and family who had come to say goodbye.

But at the eleventh hour, a battery of blood tests gave the researchers a clue as to what might help save Emma: Her level of one of the cytokines, interleukin-6 or IL-6, had shot up a thousandfold. Doctors had never seen such a spike before and thought it might be what was making her so sick. Dr. June knew that a drug could lower IL-6 — his daughter takes it, for rheumatoid arthritis. It had never been used for a crisis like Emma’s, but there was little to lose. Her oncologist, Dr. Stephan A. Grupp, ordered the drug. The response, he said, was “amazing.”

Within hours, Emma began to stabilize. She woke up a week later, on May 2, the day she turned 7; the intensive-care staff sang “Happy Birthday.”

Since then, the research team has used the same drug, tocilizumab, in several other patients.

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Fed Likely to Sustain Bond-Buying Program to Stimulate Growth

WASHINGTON — The Federal Reserve is widely expected to announce on Wednesday that it will continue buying Treasury securities to stimulate growth in the new year.

The Fed’s public declaration in September that it would buy bonds until the outlook for the labor market “improved substantially” has cleared away much of the uncertainty and controversy that usually precedes such announcements.

The economic recovery remains lackluster and millions are looking for work. But while some analysts question the central bank’s ability to improve the situation, few doubt that the Fed, under its chairman, Ben S. Bernanke, is determined to keep trying.

Indeed, while Fed officials continue to warn that a failure to avert scheduled tax increases and spending cuts next year would overwhelm their efforts and plunge the economy back into recession, they have also said that even if Congress and the White House negotiate a compromise, the Fed’s efforts would continue.

“I am not prepared to say we are remotely close to substantial improvement on the employment front,” Dennis P. Lockhart, president of the Federal Reserve Bank of Atlanta, said in a recent speech. “I expect that continued aggressive use of balance sheet monetary tools will be appropriate and justified by economic conditions for some time, even if fiscal cliff issues are properly addressed.”

The remarks were particularly significant because Mr. Lockhart is among the moderate members of the Federal Open Market Committee whose support Mr. Bernanke invested months in winning before starting the new policy.

With the direction of policy clearly set, debate has turned to the details. The Fed, whose policy-making committee is meeting on Tuesday and Wednesday, still must determine what to buy and how much to spend, and officials continue to debate the best way to describe when the agency is likely to stop buying.

In making those decisions, the Fed must balance its conviction that buying bonds reduces borrowing costs for businesses and consumers against concerns the purchases might disrupt financial markets or inhibit its control of inflation.

Analysts say the immediate answer is likely to be more of the same. The Fed currently buys $40 billion of mortgage-backed securities and $45 billion of Treasury securities a month. Officials highlighted that $85 billion figure in September, and have indicated since that it remained their rough target.

“It would be odd for them to disappoint the expectations that they have created themselves,” Kris Dawsey of Goldman Sachs wrote in a note to clients predicting that the Fed would maintain both the dollar amount and the division. Other analysts have suggested the Fed might slightly decrease the total amount of purchases, to $80 billion, or increase the share of mortgage securities.

The Fed is unlikely to announce a new timetable this week, analysts said. The committee has said that it does not plan to raise interest rates before the middle of 2015, and that it will stop buying bonds before it starts raising rates.

Many officials on the 12-member committee — perhaps even the majority — would prefer to substitute economic objectives for guidance set by the calendar. The Fed’s ability to reduce borrowing costs derives in part from persuading investors that interest rates will remain low. Telling investors how the economic situation must change in order to warrant a change in policy could be more convincing, and therefore more potent, than simply publishing an estimated endpoint, these officials say.

But an account of the committee’s previous meeting, in late October, showed that officials remained divided about which economic objectives to use.

The most vocal proponent of focusing on economic goals, Charles L. Evans, president of the Federal Reserve Bank of Chicago, said last month that the Fed should declare its intent to keep short-term interest rates near zero until the unemployment rate fell below 6.5 percent, provided that the rate of inflation did not exceed 2.5 percent.

“I believe we have the ability to go even further in reassuring financial markets and the general public that policy will stay appropriately accommodative,” Mr. Evans said in advocating the change during a speech in Toronto.

Other officials have misgivings about placing such emphasis on any single economic indicator, or on the unemployment rate in particular.

The discussions are moving slowly, in part because it is not clear the changes being contemplated would have significant benefits. The targets the Fed is considering closely resemble its own past practice, meaning the new thresholds would tend to reinforce rather than shift expectations.

Lou Crandall, chief economist at the research firm Wrightson ICAP, noted in a recent analysis that the unemployment rate exceeded 7 percent in the mid-1980s and again in the early 1990s, and in both cases the Fed waited until the rate fell well into the 6 percent range before it began to raise interest rates.

The relative complacency of Fed officials also reflects their judgment that the mortgage-bond purchases announced in September are working. Average interest rates on 30-year mortgages are at the lowest levels on record, averaging 3.35 percent in November, according to Freddie Mac’s regular survey.

“This is solid evidence that our policy has been and continues to be effective — though it is certainly not all-powerful in current circumstances,” William C. Dudley, president of the Federal Reserve Bank of New York, said last week.

To continue the companion purchases of Treasury securities, the Fed will need to change its approach. It is now buying long-term securities with proceeds from the sale of short-term securities, but it is running out of inventory to sell.

The most likely alternative is to create money by crediting the accounts of banks that sell bonds to the Fed, the same method now being used to buy mortgage bonds and also to finance earlier rounds of the Fed’s so-called quantitative easing.

The Fed has repeatedly overestimated the health of the economy and the impact of its efforts. This time, officials have promised to maintain their efforts even as the economy shows signs of improvement. But they are once again sounding notes of cautious optimism about the coming year — if Washington does not interfere.

A budget deal reducing deficits in the long term, Mr. Bernanke said in November, “could help make the new year a very good one for the American economy.”

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Surgeon infected patients during heart procedure, Cedars-Sinai admits

A heart surgeon at Cedars-Sinai Medical Center unwittingly infected five patients during valve replacement surgeries earlier this year, causing four of the patients to need a second operation.

The infections occurred after tiny tears in the latex surgical gloves routinely worn by the doctor allowed bacteria from a skin inflammation on his hand to pass into the patients' hearts, according to the hospital. The patients survived the second operation and are still recovering, hospital officials said.

The outbreak led to investigations by the hospital and both the L.A. County and California departments of public health. The federal Centers for Disease Control and Prevention was also consulted.

Hospital officials called it a "very unusual occurrence" probably caused by an unfortunate confluence of events: the nature of the surgery, the microscopic rips in the gloves and the surgeon's skin condition. Valve replacement requires the surgeon to use thick sutures and tie more than 100 knots, which can cause extra stress on the gloves, they said.

Nevertheless, the hospital's goal is to have zero infections, said Harry Sax, vice chairman of the hospital's department of surgery. "Any hospital-acquired infection is unacceptable," he said.

The infections raise questions about what health conditions should prevent a surgeon from operating and how to get the best protection from surgical gloves. Surgeons with open sores or known infections aren't supposed to operate, but there is no national standard on what to do if they have skin inflammation, said Rekha Murthy, medical director of the hospital's epidemiology department. She added that there were also no national standards on types of gloves used, whether to wear double gloves or how many times surgeons should change those gloves during a procedure.

Healthcare-acquired infections are very common throughout the United States. Each year, infections cause 99,000 deaths in the country, including about 12,000 in California. Hospitals in the state are required to report certain infections to the California Department of Public Health. That reporting makes the public more aware of the quality of care provided at local hospitals and is an important tool for reducing infections, said Debby Rogers, deputy director of the department's Center for Health Care Quality.

Cedars-Sinai has low rates for hospital-acquired infections compared with the state and national average but has not performed as well on other surgical quality measures recently, according to the Leapfrog Group, an employer-backed nonprofit focused on healthcare quality. The organization gave the hospital a C rating last month on its national report card, down from an A in June, though it was not related to the infection outbreak.

"Clearly this hospital is making attempts to reduce infections, but they have more work to do," said Leah Binder, Leapfrog's chief executive.

Cedars-Sinai Medical Center conducts about 360 valve replacement surgeries each year and said infections occur in fewer than 1% of its cases — lower than the national average.

The hospital learned about the problem in June after three patients who had undergone valve replacement surgery showed signs of infection. Doctors diagnosed the patients with an infection called endocarditis. Concerned there might be a connection among the cases, epidemiologists analyzed the bacteria, staphylococcus epidermidis, and determined that it was an identical strain and therefore must have come from a single source. "It led to the question of gee, I wonder where it came from?" Murthy said.

Epidemiologists homed in on the surgeon with the skin inflammation. The bacteria matched, and then they made a surprising discovery: microscopic tears in the gloves typically worn by surgeons after performing valve replacement surgery. The surgeon, whose name was not released, was not allowed to operate again until he healed. He is still a member of the medical staff but no longer performs surgeries at the hospital.

The hospital soon found the same infection in two more patients. Officials also reached out to 67 patients who had heart valve replacements with the same surgeon but didn't find any other cases. One of the five infected patients was treated with antibiotics, and the other four had new valve replacement surgeries. Sax said the hospital apologized to the patients and has continued to monitor their health. The hospital has also covered the cost of their care, including follow-up treatment and all the related surgeries.

All surgeons doing valve replacements are now required to change gloves more frequently, officials said. Some surgeons are wearing double gloves during the operations, Sax said.

Following the outbreak, Cedars-Sinai did the proper follow-up to ensure the safety of their patients, said Dawn Terashita, a medical epidemiologist with L.A. County, who was notified in September. What occurred at Cedars-Sinai was an unintentional consequence of the surgery, she said.

"There is no way to keep a room entirely sterile and all the people in it sterile," she said. "You will always have risk of infection."

anna.gorman@latimes.com

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New Crowdfunding Site Seeks to Protect Backers of Industrial Design

Entrepreneur Jamie Siminoff wants to build more credibility into crowdfunding — so he’s launching a new platform that takes responsibility for ensuring the viability of new projects.

The crowdfunding process, pioneered by sites like Kickstarter, has had its share of huge successes, as well as failures. The problem, says Siminoff, is that when a venture fails, the funders are left holding the bag. That’s all well and good if you were investing in an artist’s crazy project. It’s much more of a problem if you thought you were pre-ordering a nearly finished gadget.

The biggest culprit for these kinds of issues are physical products. Witness the anger unleashed when Kickstarter darling Pebble announced a further delay alongside underwhelming color choices.

This kind of issue is why Kickstarter recently made some changes, undertaking a combination of education and rule revision. They reminded consumers that Kickstarter is not a store while requiring that all projects disclose risks and challenges, as well as forbidding renderings and concept videos in hardware products.

Siminoff’s answer is Christie Street, a crowdfunding site devoted exclusively to physical products. The promise of Christie Street is that it will vet the projects that it launches carefully, and provide guarantees of progress along the way. The idea is that these protections will make consumers feel safer about the products they’re backing. “We built something that we felt we needed,” he says.

Christie Street, named for the New Jersey road where Edison’s workshop was located, will require that all funders go through an auditing process before they are allowed to go live. Siminoff says that the idea will be to check for basic viability, a kind of sanity test.

“You look at the chips they say they want to use, the size of components that will need to fit in, and so on,” he says, “You check that things conform to what’s available on the market.” From there, they also perform third-party audits of the places where the product will be manufactured, and look at things like production cost and likely shipping time, to ensure that all of this seems realistic.

It’s an all-or-nothing audit. Either the new project meets Christie Street’s approval or it doesn’t. “Our feeling is that the customer that’s buying doesn’t have the sophistication to make the right decision [about whether a design's production targets are reliable],” says Siminoff, “The only way is create a place where you can trust to buy.”

Even after the initial approval, Christie Street stays involved in the project. Successfully funded projects get their money in stages, with Christie Street holding the rest in escrow. Inventors get one-third of the money on funding, one-third of the money once they have a production-ready prototype, and the final one-third when they have a golden prototype, which means they are ready for full manufacturing.

If at any time along the way the project fails, Christie Street will can the project and refund the remaining money to investors.

What constitutes failure? Siminoff ticks off four conditions.

First, the inventor could for whatever reason announce that they couldn’t finish.

Second, if the project ends up more than six months late. “This forces people to be more careful with their delivery dates,” says Siminoff.

Third, if the product falls short of what was promised. “If the pre-production sample is more than 15 percent worse than what was promised, we will not allowed you to manufacture the product,” says Siminoff. (For example, if you promised me 512GB and only delivered 256.)

Last, says Siminoff there are other nuances that they’ll have to work out as the site develops. For example, if a product ends up requiring significant redesign, then Christie Street might end up withholding funds. “Design is a tougher one to quantify,” he says, “but it’s important that the design overall fits what was promised to the customer.”

For the extra cautious, Christie Street goes even further than the refund of remaining money. For 10 percent of their pledge value, backers can insure their entire pledge. If the project goes wrong they’ll get all of it back. Combine that with a pledge from inventors that the product will retail for at least 10 percent more than the pledge amount, and you can either take a 10 percent discount for some additional risk or pay full retail, with a money-back guarantee.

In effect, Christie Street is navigating a space between crowfunding sites like Kickstarter and Indiegogo, which expect backers to handle a lot of their own due diligence while allowing the inventors to be entrepreneurs, and crowdsourcing design sites like Quirky, which handles all of the business elements in-house.

Christie Street is an effort at drawing the lines of trust in a new way, one tied directly to the realities of post-industrial product design. Rather than a blanket ban on renderings and early designs, or a Wild West ‘anything goes’ approach, they instead seeks to tame the parts where production can go really wrong, in the devilish details of prototyping and manufacturing. It leaves questions of whether or not the thing is cool to the wisdom of the crowds, while taking on the question of whether or not the thing is possible.

This is obviously a lot more intervention between middleman and inventor than you’d see on a site like Indigegogo or Kickstarter. Siminoff says that they can still take the same 5 percent cut as their competitors because physical products tend to be involved higher dollar-value projects from the start. “If all goes well, we’ll be doing 10 to 15 live projects a months a year from now,” he says, “We think we can be profitable in the product world.”

“We’re not trying to make it where inventors are just be a name on a product,” says Siminoff, “We still want them to be entrepreneur and build this thing. We just want to make sure that they don’t fail in a way that hurts the customer.”

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Mick Jagger and Keith Richards to duet on “Letterman” Top 10

LOS ANGELES (TheWrap.com) – Mick Jagger and Keith Richards are no strangers to Top 10 lists, but now they’re poised to expand their knowledge of them beyond the music charts.

Rolling Stones leaders Jagger and Richards will appear on “Late Show With David Letterman” on Tuesday to deliver the Top Ten list for the night, CBS said Friday.

Though this will mark the first time that Jagger and Richards have appeared on “Letterman,” they’ve appeared on the stage of the Ed Sullivan Theater – where “Late Show” is taped – before. The Stones made numerous appearances on “The Ed Sullivan Show,” starting with their maiden performance on October 25, 1964.

The group is currently celebrating its 50th anniversary and recently released the greatest-hits anthology “GRRR!” They be in the area to play the Barclays Center in Brooklyn on Saturday, and at Newark’s Prudential Center on Thursday.

The group will also perform at the Hurricane Sandy benefit concert 12.12.12 – The Concert for Sandy Relief, which takes place Wednesday at Madison Square Garden. Other performers at the benefit will include Paul McCartney, the Who, Bruce Springsteen & the E Street Band, Billy Joel and Eric Clapton, among others.

Letterman has been rubbing shoulders with rock royalty lately – earlier this week, he was joined on his show by the surviving members of Led Zeppelin. Last weekend, Letterman and the group received Kennedy Center Honors.

TV News Headlines – Yahoo! News

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New Taxes to Take Effect to Fund Health Care Law

WASHINGTON — For more than a year, politicians have been fighting over whether to raise taxes on high-income people. They rarely mention that affluent Americans will soon be hit with new taxes adopted as part of the 2010 health care law.

The new levies, which take effect in January, include an increase in the payroll tax on wages and a tax on investment income, including interest, dividends and capital gains. The Obama administration proposed rules to enforce both last week.

Affluent people are much more likely than low-income people to have health insurance, and now they will, in effect, help pay for coverage for many lower-income families. Among the most affluent fifth of households, those affected will see tax increases averaging $6,000 next year, economists estimate.

To help finance Medicare, employees and employers each now pay a hospital insurance tax equal to 1.45 percent on all wages. Starting in January, the health care law will require workers to pay an additional tax equal to 0.9 percent of any wages over $200,000 for single taxpayers and $250,000 for married couples filing jointly.

The new taxes on wages and investment income are expected to raise $318 billion over 10 years, or about half of all the new revenue collected under the health care law.

Ruth M. Wimer, a tax lawyer at McDermott Will & Emery, said the taxes came with “a shockingly inequitable marriage penalty.” If a single man and a single woman each earn $200,000, she said, neither would owe any additional Medicare payroll tax. But, she said, if they are married, they would owe $1,350. The extra tax is 0.9 percent of their earnings over the $250,000 threshold.

Since the creation of Social Security in the 1930s, payroll taxes have been levied on the wages of each worker as an individual. The new Medicare payroll is different. It will be imposed on the combined earnings of a married couple.

Employers are required to withhold Social Security and Medicare payroll taxes from wages paid to employees. But employers do not necessarily know how much a worker’s spouse earns and may not withhold enough to cover a couple’s Medicare tax liability. Indeed, the new rules say employers may disregard a spouse’s earnings in calculating how much to withhold.

Workers may thus owe more than the amounts withheld by their employers and may have to make up the difference when they file tax returns in April 2014. If they expect to owe additional tax, the government says, they should make estimated tax payments, starting in April 2013, or ask their employers to increase the amount withheld from each paycheck.

In the Affordable Care Act, the new tax on investment income is called an “unearned income Medicare contribution.” However, the law does not provide for the money to be deposited in a specific trust fund. It is added to the government’s general tax revenues and can be used for education, law enforcement, farm subsidies or other purposes.

Donald B. Marron Jr., the director of the Tax Policy Center, a joint venture of the Urban Institute and the Brookings Institution, said the burden of this tax would be borne by the most affluent taxpayers, with about 85 percent of the revenue coming from 1 percent of taxpayers. By contrast, the biggest potential beneficiaries of the law include people with modest incomes who will receive Medicaid coverage or federal subsidies to buy private insurance.

Wealthy people and their tax advisers are already looking for ways to minimize the impact of the investment tax — for example, by selling stocks and bonds this year to avoid the higher tax rates in 2013.

The new 3.8 percent tax applies to the net investment income of certain high-income taxpayers, those with modified adjusted gross incomes above $200,000 for single taxpayers and $250,000 for couples filing jointly.

David J. Kautter, the director of the Kogod Tax Center at American University, offered this example. In 2013, John earns $160,000, and his wife, Jane, earns $200,000. They have some investments, earn $5,000 in dividends and sell some long-held stock for a gain of $40,000, so their investment income is $45,000. They owe 3.8 percent of that amount, or $1,710, in the new investment tax. And they owe $990 in additional payroll tax.

The new tax on unearned income would come on top of other tax increases that might occur automatically next year if President Obama and Congress cannot reach an agreement in talks on the federal deficit and debt. If Congress does nothing, the tax rate on long-term capital gains, now 15 percent, will rise to 20 percent in January. Dividends will be treated as ordinary income and taxed at a maximum rate of 39.6 percent, up from the current 15 percent rate for most dividends.

Under another provision of the health care law, consumers may find it more difficult to obtain a tax break for medical expenses.

Taxpayers now can take an itemized deduction for unreimbursed medical expenses, to the extent that they exceed 7.5 percent of adjusted gross income. The health care law will increase the threshold for most taxpayers to 10 percent next year. The increase is delayed to 2017 for people 65 and older.

In addition, workers face a new $2,500 limit on the amount they can contribute to flexible spending accounts used to pay medical expenses. Such accounts can benefit workers by allowing them to pay out-of-pocket expenses with pretax money.

Taken together, this provision and the change in the medical expense deduction are expected to raise more than $40 billion of revenue over 10 years.

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Tax Arithmetic Shows Top Rate Is Just a Starter in Talks

WASHINGTON — Despite hints in recent days that President Obama and House Speaker John A. Boehner might compromise on the tax rate to be paid by top earners, a host of other knotty tax questions could still derail a deal to avert a fiscal crisis in January.

The math shows why. Even if Republicans were to agree to Mr. Obama’s core demand — that the top marginal income rates return to the Clinton-era levels of 36 percent and 39.6 percent after Dec. 31, rather than stay at the Bush-era rates of 33 percent and 35 percent — the additional revenue would be only about a quarter of the $1.6 trillion that Mr. Obama wants to collect over 10 years. That would be about half of the $800 billion that Republicans have said they would be willing to raise.

That calculation alone suggests the scope of the other major tax issues to be negotiated beyond tax rates. And that is why many people in both parties remain unsure that a deal will come together before Jan. 1. Without agreement, more than $500 billion in automatic tax increases on all Americans and cuts in domestic and military programs will take hold, which could cause a recession if left in place for months, economists say.

“The question is making sure that we hit a revenue target that’s required for a truly balanced deficit-reduction plan,” said Representative Chris Van Hollen of Maryland, the senior Democrat on the House Budget Committee. “And when the president and all of us say this is a question of math, we mean it. It’s very hard to make the numbers work without the top rates going back to the full Clinton-era levels.”

The top tax rates are taking center stage right now because Mr. Obama believes he won a mandate after campaigning relentlessly on the idea of extending Mr. Bush’s tax cuts only for households with annual income below $250,000. But the two parties also have ideological differences on taxes affecting savings, investment and inheritance, which have flared in battles going back to the Reagan years. To get a deal in the coming weeks, those differences must be addressed at least in broad terms, even if the details are left to a battle over revamping the tax code next year.

The argument over rates is far from settled. Although the two sides seem close enough on the percentages for easy compromise, principle and politics loom large: Republicans oppose raising rates as a matter of ideology, saying that it kills jobs, and the president insists that he will not keep the Bush-era rates on income above roughly $250,000 after two campaigns in which he vowed to return them to the levels of the Clinton years.

“Just to be clear, I’m not going to sign any package that somehow prevents the top rate from going up for folks at the top 2 percent,” he said Thursday.

In recent days, comments from some Republicans, including Mr. Boehner, their chief negotiator, have hinted that the party — recognizing its weak hand — might be moving toward a concession on tax rates. Seldom mentioned is that Mr. Obama’s revenue total also reflects four other changes from Bush-era tax cuts: higher tax rates on investment income from capital gains and dividends, and the restoration of two other Clinton-era provisions limiting deductions and tax exemptions for affluent individuals.

Together those changes would raise $407.4 billion over a decade — nearly as much as the president’s proposal on higher rates, which would raise $441.6 billion by 2023, for a total of $849 billion. Another $119 billion would come from higher estate taxes, opposed by Republicans and some Democrats.

And both the president and Republicans are committed to raising hundreds of billions of dollars by overhauling the tax code to further limit or end the tax breaks that high-income taxpayers can claim, though they differ in how to do that.

Republicans want to raise all $800 billion from overhauling the tax code, erasing tax breaks for high-income households and using the new revenues both to reduce deficits and to lower everyone’s tax rates. But they have not proposed how to do that, and the president insists it cannot be done without hitting middle-income taxpayers.

Mr. Obama has proposed to keep existing tax breaks but to limit the rate of those breaks for people in higher tax brackets to 28 percent, which would raise $584 billion in a decade. He has proposed variations of that proposal for four years, only to be ignored by both parties because of opposition from charitable groups, the housing industry, insurers and others to curbing deductions for charitable giving, mortgage insurance and other purposes.

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Supreme Court to rule on California's Prop. 8 ban on gay marriage

Justices will rule for the first time on same-sex marriage by deciding the constitutionality of Prop. 8.

The Supreme Court announced Friday it will rule for the first time on same-sex marriage by deciding the constitutionality of California’s Proposition 8, the voter initiative that limited marriage to a man and a woman.

The justices also said they would decide whether legally married gay couples have a right to equal benefits under federal law.

The California case raises the broad question of whether gays and lesbians have an equal right to marry.

FULL COVERAGE: The battle over gay marriage 

If the justices had turned down the appeal from the defenders of Prop. 8, it would have allowed gay marriages to resume in California, but without setting a national precedent.

Now, the high court has agreed to decide whether a state’s ban on same-sex marriages violates the U.S. Constitution. The court’s intervention came just one month after voters in three states — Maine, Maryland and Washington — approved gay marriages. This brought the total to nine states having legalized same-sex marriages. 

But the justices also left themselves a way out. They said they would consider whether the defenders of Prop. 8 had legal standing to bring their appeal.

The justices made the announcement after meeting behind closed doors. They did not say which justices voted to hear the appeals.

Last year, the U.S. 9^th Circuit Court of Appeals struck down Prop. 8, but it did so on a narrow basis. Judge Stephen Reinhardt reasoned that the voter initiative was unconstitutional because it took away from gays and lesbians a right to marry that they had won before the state Supreme Court.

The justices now will have at least three options before them: They could reverse the 9^th Circuit and uphold Prop. 8, thereby making it clear that the definition of marriage will be left to the discretion of each state and its voters.

They could rule broadly that denying gays and lesbians the fundamental right to marry violates the Constitution’s guarantee of equal protection of the laws. Such a decision would open the door to gay marriages nationwide.

Or as a third option, they could follow the approach set by the 9^th Circuit and strike down Prop. 8 in a way that limits the ruling to California only.

In the other gay-marriage cases, the court will decide the constitutionality of part of the Defense of Marriage Act  that denies federal benefits to legally married couples. Judges in New England, New York and California have ruled this provision unconstitutional.

The justices are expected to hear arguments in the two sets of gay marriage cases in March and issue decisions by late June.

FULL COVERAGE: The battle over gay marriage 

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david.savage@latimes.com

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Makers of Pebble E-Watch Break Hearts, Announce They Won't Ship by Christmas

Backers of Pebble, the innovative Kickstarted E-Ink smartwatch that is months behind its shipping date, just got a further dose of bad news. The $10,000,000-earning watch’s creators just posted a holiday e-card on their Kickstarter page stating they won’t be shipping by Christmas.

The company’s card comes at the end of a longer status update from the aspiring watchmakers, after news about new color options and SMS/iPhone capabilities. Designed with cheery holiday colors and featuring a poem written with a lighthearted tone, the image may have sent initial hope to its over 68,000 backers. But in its fourth line, the card dashes any excitement with an announcement of yet another delay for the eagerly anticipated watch.

Below the image, Pebble’s team gives a slightly more official notification of the setback.

Unfortunately we will not be able to ship out Pebble in time for the holidays. As a tiny act of compensation, we’d like to offer you this little holiday card. I know it’s not a Pebble, but I do hope that you can tell from these updates that we’re quickly moving towards the moment when Pebble will finally be on your wrist.

It’s another black mark for one of the highest-grossing campaigns in Kickstarter history. Since completing with over $10 million in May of this year, hopeful backers have yet to see their products. An initial promise to ship in September passed without fulfillment; reports in October stated that Pebble’s lead designer was “stuck in Asia” to work with manufacturers on getting the watch completed and shipped.

And now, they’re offering a printable card as a holiday peace offering. Comments stemming from the announcement range from understanding to downright angry.

No information on a new deadline has been released.

Mike Senese is the editor of Wired Design. He's also a TV host who discusses technology, teaches science, and inspires people to build things (and make pizza) through his DIY website, mikesenese.com/DOIT

Read more by Mike Senese

Follow @msenese on Twitter.

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