Blogged Health

By Jason Szep

BOSTON (Reuters) - One 4-month-old baby was shaken so violently she needed surgery. Another 3-week-old suffered fractured ribs from abuse at home. A 9-year-old diabetic boy stopped receiving proper treatment for his condition.

Those cases reported by Boston hospitals are part of a spike in child abuse in United States during a recession that has driven some families to the brink and overwhelmed cash-strapped child-protection agencies.

"In the last three months we have twice as many severe inflicted injury cases as we did in the three months the previous year," said Allison Scobie, program director of the Child Protection Team at Boston's Children's Hospital.

Typically, her hospital handles about 1,500 such cases a year. That rose to 1,800 last year.

"We're finding that it is directly attributable to what is happening economically," she said. "Many of the hospitals around here report an increase of 20 to 30 percent of requests for consultation regarding suspected child maltreatment."

Many cases bear the imprint of economic troubles, like a 9-year-old diabetic boy hospitalized after his mother, a single parent, could no longer afford insurance co-payments needed to treat his disease. She left him home alone for long stretches on days when he required medical attention.

"She had difficulty with the bare bone things that would keep this child healthy," said Scobie.

Similar stories have surfaced in other regions, according to anecdotal and official reports. The Illinois department of child and family services, for example, reported a 5.8 percent rise in child abuse cases in the state in 2008. In the Chicago area, child abuse cases rose more than 9 percent last year.

Child abuse cases in Ohio, a state hit hard by the recession, topped 100,000 for the first time in 2007 and have continued to rise, according to the Public Children Services Association of Ohio, a nonprofit association of agencies charged with child protection.

"Many of our county agency directors tell us their child abuse reports have risen," said the group's director, Crystal Ward Allen, whose agency relies heavily on local revenue drawn from property taxes, which have collapsed in the recession.

"Our basic safety net is really faltering," she said.

Most recent federal data show child abuse declined in the United States in 2007 to a rate of 10.6 percent of America's total 71 million children, from 12.1 percent in 2006.

But some see that changing dramatically. A March poll by Mason-Dixon Polling and Research showed that 88 percent of 607 sheriffs, district attorneys and chiefs of police nationwide expect a rise in child maltreatment. They based their views largely on similar rises in past recessions.

'HUGE INFLUX OF SHAKEN-BABY CASES'

Many doctors agree. Seattle's Children's Hospital and the Harborview Medical Center are seeing more children suffering subdural bleeding caused by blows to the head from abuse. In a typical year, they treat about one such child a month. Last year, they admitted nearly three times as many -- or 32 children.

"We have been pretty busy again this year,' said Dr. Kenneth Feldman, medical director of the Children's Protection Program at Seattle Children's Hospital. "The vast majority are from families who are struggling financially."

A flurry of similar cases startled doctors late last year in Syracuse, New York. "I was just shocked," said Dr. Ann Botash, who heads the Child Abuse Referral and Evaluation Program at State University of New York in Syracuse, a city of about 147,300 people.

The medical university where she works treated 19 children with head injuries consistent with beatings or being severely shaken last year, including four who died, up from just a handful the year before. Victims averaged about 7 months old.

"Around December I saw much more than I usually see. I usually get one consult a month. And we were quadrupling that," she added. "I'm seeing more severe physical abuse. In general there's a lot more stress right now in society. And it comes out on the kids. They are the weakest link."

Some doctors term such cases "shaken-baby syndrome," which the National Institute of Neurological Disorders and Stroke says bear distinct signs: brain hemorrhaging, retinal hemorrhaging and damage to the spine, neck or ribs.

Because of a baby's relatively large head and weak neck, shaking "makes the fragile brain bounce back and forth inside the skull and causes bruising, swelling and bleeding, which can lead to permanent, severe brain damage or death," it says.

"We saw a huge influx of shaken-baby cases," said Dr. Alice Newton, medical director at Massachusetts General Hospital's Child Protection Team, which treated 25 children for serious abuse this year. That compares with 16 for all of 2008.

In a typical year she might see 12 to 14 children for serious inflicted head trauma. But she's already seen nine this year. And many are from families without the usual warning flags such as a prior history of child abuse or drug problems.

In one case, a 4-month-old girl was admitted in a "staring spell" and needed surgery to remove fluid around her brain. The father had been laid off and the mother was working. Money was tight, she said. Some utilities had been shut off in the home.

"That clearly is a family that is stressed," she said.

The girl was treated a month earlier for similar symptoms and vomiting, but doctors at the time didn't suspect abuse.

Such cases in Boston are sent to Suffolk County District Attorney Daniel Conley, who has seen allegations of child abuse more than double in January to February from the same period last year, said Conley's spokesman, Jake Wark.

Some parents are arrested and prosecuted, and their children put in the care of relatives or foster families. But overwhelmed and underfunded agencies are not able to keep pace with the rise.

"We're getting swamped," said Robert Sage, director at the Boston Medical Center's Child Protection Team, which treated 500 children with injuries consistent with abuse last year. That rate rose 30 percent in the first two months of 2009.

"It's pretty much everything. A lot of physical abuse. Some neglect," he said.

Many state agencies and hospital are grappling with the increases while facing budget cuts. In Massachusetts, for example, the Department of Children and Families in charge of protecting children from abuse expects to see its budget cut by $25 million in fiscal 2010.

(Editing by Cynthia Osterman)

By Kevin Krolicki and Soyoung Kim

DETROIT (Reuters) - Fiat SpA Chief Executive Sergio Marchionne turned up the heat on talks with struggling U.S. automaker Chrysler on Wednesday as General Motors Corp confirmed a possible buyer for its Saturn network.

An investor group that includes private equity firm Black Oak Partners LLC and some Saturn dealers has approached GM about buying the assets of the Saturn brand and distribution network.

In late March, the U.S. auto task force rejected the turnaround plans of Chrysler and GM, telling Chrysler it had until April 30 to cement the alliance with Fiat and reach deals to cut its labor costs and debt.

GM was given until the end of May to make much deeper cuts, far quicker than the automaker had envisioned if it wants to hold the $13.4 billion of U.S. government emergency loans it received and additional support.

Marchionne said he saw no reason why Fiat and Chrysler could not complete a proposed alliance by the end of April, a target set by the U.S. auto task force that must decide whether to provide more government aid to the Detroit automaker.

"I intend to reach a good conclusion," Marchionne told reporters at a news conference in Zurich, adding that Fiat has other options as well.

Marchionne, in an interview with the Globe and Mail newspaper published on Wednesday, said a deal on the partnership had only a 50-50 chance of succeeding because of lack of progress in talks between Chrysler and union leaders.

The Canadian Auto Workers union said on Wednesday that it plans to resume talks with Chrysler on Monday that have been stalled since the beginning of April. Those talks are crucial to Chrysler completing an alliance with Fiat.

The chief bargainer for the Canadian union also said he believed Chrysler was close to an agreement with the United Auto Workers in the United States. A representative of Chrysler and of the UAW could not be reached immediately for comment.

Chrysler has until the end of April to forge an alliance with Fiat to qualify for long-term U.S. and Canadian government aid. The deal hinges on Chrysler securing concessions from its unions in Canada and the United States as well as an agreement with those who hold Chrysler's first-lien loans.

Canadian Auto Workers President Ken Lewenza said on Wednesday that labor costs should not stand in the way of the alliance.

SATURN TAKER?

GM confirmed discussions with the investor group on Saturn and said it had been in talks with others on the sales of the distribution network and other automakers about supplying vehicles to Saturn. It plans to update Saturn dealers on the progress of the spinoff this week or next week.

The group proposes to turn Saturn and its 440 existing U.S. and Canadian dealerships into a diversified distributorship that would start by sourcing vehicles from GM and eventually offer those from other automakers.

GM has proposed to move forward with its Chevrolet, Cadillac, Buick and GMC brands in North America, either spinning off or closing Saturn along the way with 2011 as the last model year for the brand.

GM shares gained 11 cents, or 6.2 percent, to close at $1.89 on the New York Stock Exchange on Wednesday.

If GM and Chrysler fail to meet the deadlines imposed by the task force, the two automakers could be forced into bankruptcy. GM would be expected to attempt to reorganize and emerge as a smaller company. Chrysler executives have indicated the automaker would be liquidated if it fell into bankruptcy.

GM must cut about $28 billion of unsecured debt more deeply than the two-thirds reduction previously targeted. Chrysler is tasked with eliminating most of a $7 billion first-lien term loan that stems from its split from Daimler AG in 2007.

Those targets have proven to be major obstacles for GM and Chrysler. Chrysler lenders did not present a counteroffer and there were no new talks between GM and its bondholders on Wednesday, people familiar with both talks said.

A steering committee for the Chrysler lenders confirmed on Wednesday that it had been expanded to include Oppenheimer Funds, Perella Weinberg Partners and Stairway Capital. Sources had told Reuters on Tuesday of those additions and of Elliott Management, which was added last week.

Those members are added to the committee which includes Citigroup, Goldman Sachs, JPMorgan Chase and Morgan Stanley.

Automakers are struggling through a deep global downturn in sales driven in part by tight credit conditions and economic slowing in key regions such as North America and Europe.

The stress has filtered down to the thousands of companies that supply components to automakers, leaving many at risk for bankruptcy in coming months. The U.S. Treasury has pledged up to $5 billion of loans to support the supplier sector.

On Wednesday, Noble International Ltd, which supplies structural components to the auto industry, filed for bankruptcy protection, citing a substantial drop in demand from customers and frozen credit markets.

Noble said it had negotiated debtor-in-possession financing with certain customers and hoped to use Chapter 11 protections to pursue sales of its remaining operations.

The global car industry is showing no convincing signs of recovery yet as sluggishness in developed economies has deeply dented demand, Hyundai Motor Group Vice Chairman Lee Hyun-soon said on Wednesday.

Auto markets in China, India and Brazil should outperform, helped by government incentives, growing incomes and faster economic recovery, Lee told Reuters in an interview. The group owns South Korea's top two auto makers: Hyundai Motor Co and Kia Motors Corp.

(Reporting by Kevin Krolicki, Soyoung Kim, Poornima Gupta, David Bailey, John McCrank, Gilles Castonguay, Lisa Jucca, Cheon Jong-woo, editing by Matthew Lewis, Richard Chang)

By Alister Bull and Mark Felsenthal

WASHINGTON (Reuters) - The U.S. economy continued to weaken in March and early April but the speed of contraction was fading amid scattered signs the country's recession may be nearing an end, the Federal Reserve said on Wednesday.

"Five of the 12 districts noted a moderation in the pace of decline, and several saw signs that activity in some sectors was stabilizing at a low level," according to the Fed's Beige Book summary of anecdotal reports from its 12 regional banks.

The survey was based on information collected by the Federal Reserve Bank of Dallas on or before April 6.

"This is good evidence that activity is becoming less bad across the country. Granted, things are still bad, but less so. And I'll take that over the alternative," said Jennifer Lee, an economist at BMO Capital Markets.

Wall Street stocks took heart from the guardedly reassuring tone of the report, which breaks a relentless string of depressing news from the closely watched Beige Book.

The Dow Jones industrial average added more than 20 points to stand 50 points higher at 7,970.

"Although conditions are still weak right now, there are signs that there is stabilization in certain sectors," said Michelle Meyer, an economist with Barclays Capital. "We're clearly still in a deep recession but there are signs that things are looking a little bit brighter."

The U.S. central bank has cut interest rates to almost zero to beat back a severe recession sparked by the collapse of the housing market, but Fed Chairman Ben Bernanke on Tuesday said there were tentative signs the economic decline was slowing.

Fed officials say this massive monetary stimulus, together with unprecedented programs to promote growth by flooding markets with money, should gradually restore growth this year.

In particular, the Fed has tried to boost demand for houses by purchasing mortgage backed securities. This has helped drive home loan interest rates to the lowest level in a generation and the strategy appeared to be gaining traction.

"Housing markets remained depressed overall, but there were some signs that conditions may be stabilizing," the Fed said.

"Outlooks for the housing sector were generally more optimistic than in earlier surveys, with respondents hopeful that increased buyer interest would lead to better sales."

The survey still painted a bleak picture of an economy reeling from a prolonged recession that has cost millions of jobs, with unemployment rate reaching 8.5 percent last month.

In particular, labor market conditions were described as weak with lay-offs, temporary shutdowns and hiring freezes widespread. The New York Fed, whose banking-heavy district has been hammered by the financial crisis, characterized the supply of available workers as "inexhaustible".

"Many 2008 college graduates are still looking for jobs, with 2009 graduates now entering the market," it said.

As a result of this economic slack, districts reported downward pressure on prices, including significant discounting among retailers and many service providers cutting fees.

Consumer spending remained soft, but some districts said sales rose compared with the depressed levels in the previous reporting period. Big ticket and luxury item purchases declined, while spending on food and necessities fared better, the Fed said.

Manufacturing, which has also been hurt badly in the slowdown as demand for new cars crashed, continued to weaken across the board in most districts.

"Several firms in these sectors noted that demand for products related to autos or housing ranged from 'weak' to 'horrible'," the Philadelphia Fed said.

(Reporting by Alister Bull; Editing by Chizu Nomiyama)

By Matt Spetalnick

WASHINGTON (Reuters) - President Barack Obama promised Americans his administration would reform the "monstrous" U.S. tax system as millions faced the dreaded annual deadline on Wednesday for filing income tax returns.

Obama used Tax Day, a national ritual of public frustration due to the confusing tax code, to underscore his drive to cut taxes for many Americans while increasing spending to jolt the United States out of its worst recession in decades.

Opposition Republicans seized the chance to rail against what they see as wasteful spending by his new Democratic administration, and some of Obama's grass-roots critics staged "tea party" protests in several U.S. cities.

Obama is pushing a $3.5 trillion federal budget plan that Republicans and some Democrats say carries too much deficit spending and too few tax cuts.

"My administration has taken far-reaching action to give tax cuts to the Americans who need them, while jump-starting growth and job creation in the process," Obama said at a White House event with a group of workers and business owners.

White House spokesman Robert Gibbs said Obama had already cut taxes for 95 percent of Americans and would stick to his pledge of no higher taxes for anyone earning less than $250,000 a year.

"We know that tax relief must be joined with fiscal discipline," Obama said. He also reiterated a pledge to stop giving tax breaks to companies that "ship jobs overseas."

Obama and his wife Michelle jointly filed a 2008 federal income tax return reporting an adjusted gross income of $2,656,902 and paying $855,323 in federal income tax and $77,883 in state income taxes, according to tax information released by the White House.

TEA PARTY PROTESTS

As a counterpoint to Obama's defense of his policies, protests were held in Washington, Chicago, Boston and other cities. Organizers said the protests were inspired by the 1773 Boston Tea Party rebellion against British colonial taxes, which helped spark the American revolution.

The "tea party" protesters demonstrated against taxes, government bailouts and Obama's budget proposal.

Rallies were planned at state legislatures across the South, the most conservative region of the United States. In Mississippi, around 2,000 people gathered on the steps of the state capitol in Jackson.

"Our biggest thing is to protest the overspending of our government. They are not looking at the people. They are just automatically dipping into our pockets," said Julia Hodges, an organizer of the Tax Day Tea Party in Mississippi.

Several hundred people, some in 18th century garb, braved chilly rainy weather in Lafayette Park, across the street from the White House, where they chanted "Don't tread on me!"

Since taking office on January 20, Obama has promised sweeping reform of the tax code. Former Federal Reserve Chairman Paul Volcker is leading a panel that is to study options and report back by the end of the year.

Seeking to tap into public exasperation, Obama said: "We need to simplify a monstrous tax code that is far too complicated for most Americans to understand."

"It will take time to undo the damage of years of carve-outs and loopholes. But I want every American to know that we will rewrite the tax code so that it puts your interests over any special interest. And we will make it quicker, easier and less expensive for you to file a return, so that April 15 is not a date that is approached with dread each year," he said.

(Additional reporting by Andy Sullivan in Washington, Scott Malone in Boston and Kathleen Baydala in Jackson, Mississippi; editing by Mohammad Zargham)

NEW YORK (Reuters) - New York Governor David Paterson will introduce legislation on Thursday to make gay marriage legal, but the move faces an uncertain vote in the state's Senate.

If the bill passes, New York would follow Connecticut, Massachusetts, Vermont and Iowa in legalizing gay marriage.

"The timing was always right," said Paterson, a Democrat -- who ordered all New York state agencies a year ago to recognize out-of-state gay marriages. "It's just who is willing to take that step, and I am."

Gay marriage has broad support in the Democratic-controlled State Assembly, where it passed in a vote of 85 to 61 in 2007. It was never put to a vote in the Senate while it was controlled by Republicans.

While the Democrats now hold a Senate majority for the first time in more than 40 years, it is slim -- 32 to 30 -- and at least one Democratic senator, Ruben Diaz, opposes gay marriage. He says the issue should be decided by a voter referendum.

Lawmakers in New Hampshire and Maine, which already offer same-sex couples some form of legal recognition, are also considering bills to allow gay marriage.

California briefly recognized gay marriage until voters banned it in a referendum last year.

Forty-three U.S. states have laws explicitly prohibiting gay marriage, including 29 with constitutional amendments restricting marriage to one man and one woman.

(Reporting by Michelle Nichols)

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