The Obama administration on Friday offered a compromise on new Obamacare rules that would allow religious employers to exclude contraceptives from health insurance for their employees, but would still guarantee those employees access to free coverage for birth control.
The proposed compromise follows months of protest and legal action by the Roman Catholic Church, Protestant evangelicals and others groups who argued that the President Barack Obama's health care reform law forced them to violate religious tenets against contraception.
For more than a year, the Obama administration has been grappling with how to balance its desire to guarantee universal, free contraceptive coverage with religious freedoms provided in the U.S. Constitution. Obama in February said he would create some sort of exemption for religious employers.
Catholics United, a group with a history of supporting liberal causes, applauded the move.
"This is a victory not only for the Obama Administration, but for the Catholic Church," said James Salt, executive director of Catholics United.
The Department of Health and Human Services said in a statement that the rules offer religiously affiliated hospitals, universities and charities opposed to contraceptives coverage "an accommodation." Employees and students could enroll in separate contraceptive coverage plans without co-pays and without cost to the employer.
Self-insured employers would provide notice to a third-party administrator that would then work with an insurer to arrange no-cost contraceptive coverage through separate individual health insurance policies, HHS said.
By Allison Linn
If you're planning to work past age 65, you may find that you have a surprising amount of company among your peers.
A larger chunk of Americans are working into their late 60s and even beyond, part of a long-term trend that has continued despite the tight job market of the past five years and is expected to increase in coming decades.
"It's one of the most important changes in the labor force over the last generation," said Robert Johnson, director of The Urban Institute's Program on Retirement Policy.
Most Americans still stop working by the time they hit 65. But about 18.5 percent of Americans age 65 and over were working in 2012, according to the Bureau of Labor Statistics. That's a nearly 8 percentage point increase from a low in 1985, when just 10.8 percent of Americans over age 65 were still at work.
The trend toward working past age 65 is an about-face from the decades that followed World War II. From the late 1940s through the mid-1980s, the percentage of people over age 65 who were in the labor force generally fell as workers took advantage of pensions and Social Security payments that gave them plenty of financial incentive to quit working by age 62 or even before.
These days, however, people have an incentive to work longer and wait to collect more lucrative Social Security benefits.
Perhaps more importantly, more companies have moved from pension-type retirement plans to 401(k)-type plans. Johnson noted 401(k) plans can have the opposite effect on retirement, because they aren't as generous and provide incentive for people to work longer so they can bulk up their funds more.
"The erosion in traditional pension plans has really encouraged people to work longer," he said.
Still, not everyone is healthy enough to work past age 65, and many people don't want to. Alicia Munnell, director of the Center for Retirement Research at Boston College, said her research has shown that people ages 55 to 64 are more likely to keep working for a few extra years because they didn't think they could afford to retire.
But she said people who are still working at age 65 and beyond are generally healthier, wealthier and more educated than those who have stopped working, and she thinks a significant chunk are doing so at least partly by choice.
"When you're talking with people older than 65, people are healthier and better educated and jobs are less physically demanding, and that makes it attractive to stay in the labor force," she said.
Munnell noted that not all professions are friendly to older workers, so working longer isn't always rewarding or even pleasant. But in some fields - such as academia - it is more common and acceptable to stay at work past age 65.
There are also plenty of examples of famous older people, such as Warren Buffett, 82, who are clearly staying on the job more for love than money.
The percentage of people 65 and over who are working has continued to increase in the past five years, even though the overall labor force participation rate has fallen because the tight job market has made it so hard to find jobs.
Phillip Levine, an economics professor at Wellesley College who has studied retirement trends extensively, said he doesn't think the recession itself has played a big role in exacerbating the existing trend of older workers staying in the labor force longer.
His research has shown that the Great Recession has had an opposite effect on many workers who were close to retirement, pushing them into early retirement because they lost a job and couldn't find a new one.
But in years to come, he does expect the Great Recession will play a role in increasing the number of people who work past age 65. That's because younger people who were unemployed for several years during this period will then work a few extra years to make up for the earnings, and retirement contributions, they lost during their stints of unemployment.
Johnson, from The Urban Institute, said the continued decline in pension plans also will likely play a role in more people choosing to hold onto their jobs longer than their parents or grandparents.
"The idea of retiring at age 62 – I think a lot of young people think that's a quaint idea," Johnson said.
At what age do you plan to retire?
At the Detroit Auto Show earlier this month, luxury was in the air. Pricey new Bentleys and Maseratis glittered - including a Maserati 2014 Quattroporte with a $132,000 price tag; U.S. Cabinet Secretaries and dignitaries rubbed shoulders; and many of the well-heeled attendees ponied up for a $300-a-ticket black-tie charity ball.
But in a city that is slowly dying, the glitz didn't extend much beyond the Cobo Center exhibition hall.
General Motors and Chrysler, which along with Ford gave the Motor City its identity, survived near-death experiences after filing for bankruptcy during the financial crisis. Now, Detroit itself is edging closer to a similar precipice, only unlike the automakers, its chances of getting a federal bailout are almost nonexistent.
The story of Detroit's decline is decades old: Its tax revenue and population have shrunk and labor costs have remained out of whack. But the city's budget problems have deepened to such an extent that it could run out of cash in a matter of weeks or months and ultimately be forced into what would be the largest-ever Chapter 9 municipal bankruptcy filing in the United States.
Frustrated by the lack of concrete progress, Michigan Governor Rick Snyder, a Republican, last month appointed a team to scour the city's books. The audit could result in a state takeover of Detroit's finances through the appointment of an emergency financial manager. Such a manager, who would seize control of the city's checkbook, could then propose federal bankruptcy court as the best option.
(More on CNBC.com: Hottest Cars from the Detroit Auto Show)
Snyder, who has called the situation "a crisis in terms of financial affairs," said the team would deliver its report in February.
"Detroit is teetering on the verge of bankruptcy after the City Council has failed to make the necessary cuts to deal with having a smaller population," said Rick Jones, chairman of the Republican majority caucus in the state Senate.
Jones, who has indicated he does not favor a bankruptcy, said he would like to see an emergency manager installed to fix the city's problems. If that failed, there would be a case for finding a way to shrink the Detroit municipal area, he argued.
Detroit's population is now just over 700,000 - down 30 percent since 1990 - but the city still has to provide services to an area encompassing more land than San Francisco, Boston and the borough of Manhattan.
While Democratic Mayor Dave Bing and the Detroit City Council have moved to reduce spending and initiate some reforms to stave off a takeover, including layoffs and wage and benefit cuts, the progress may not be enough for Michigan officials and lawmakers.
Streets Without Lights
In the booming post-Second World War era, Detroit was America's fifth-largest city. Today, it ranks 18th. In addition to a sharp population decline, it suffers from high unemployment related to a loss of businesses, a flood of home foreclosures and a cut in state funding. That has led to shriveling revenue, leaving the city unable to afford a workforce of more than 10,000 and the surging health and pension costs that go with them and with its retirees. As a result, credit ratings on Detroit's approximately $8.2 billion of outstanding debt have sunk deeper into junk territory.
The city's labor costs, including health care and pensions, are shrinking in absolute terms but rising as a share of the budget. They are slated to drop to $968 million, or nearly 49.5 percent of the operating budget, in the fiscal year ending June 30 versus $1.14 billion, or 45.5 percent, a year earlier.
Signs of decline are everywhere - in a rising crime rate, streets without lights and block after block of abandoned buildings. The murder rate of one per 1,719 people last year was more than 11 times the rate in New York City. The jobless rate is above 18 percent, more than twice rate for the country as a whole.
A bankruptcy would be messy.
The interests of creditors would likely collide with those of labor unions wanting to protect workers' benefits, said Eric Scorsone, a Michigan State University economist who has written papers on municipal bankruptcy and on the state's emergency manager laws.
"It is going to require the players - the City Council, the mayor, the state - to be on the same page. If you go into bankruptcy with a lot of conflict and dissent, it's going to cost more," said Scorsone.
(Read More: Auto Bailout Ultimately Steers Obama to Victory)
It could also be racially explosive. Detroit has the largest percentage of black people of any U.S. city, with 83 percent of the population identifying themselves as African American, black or Negro, according to the 2010 U.S. census. Most of Michigan's state government, including the governor's office, is run by white Republicans.
Detroit Council Member JoAnn Watson, who along with two other members of the city's all-black City Council has been resisting reform measures, said she is still hopeful of a federal bailout or an injection of state money that she claims the city is owed.
Mayor Bing would not comment for this story.
Consequences, What Consequences?
The automakers have little to say publicly about the crisis. Most of their operations in Michigan are now outside Detroit, and getting any top executive to even discuss the possibility of a city bankruptcy was almost impossible at the auto show. "I don't want to get into the politics," said GM CEO Dan Akerson, while Chrysler CEO Sergio Marchionne said: "I don't see what the consequences would be for us."
One of the city's biggest challenges is its complex set of labor agreements with a whopping 48 bargaining units that represent most of the city's workforce.
Max Newman, a bankruptcy attorney at Michigan-based Butzel Long, said a Chapter 9 bankruptcy could help the city throw out its collective bargaining agreements with unions.
Costs would have to be tackled since Detroit cannot just jack up taxes to reduce the cumulative budget deficit, which grew to $326.6 million in fiscal 2012 from $196.6 million in fiscal 2011. The state would likely resist tax increases, and they might only make matters worse anyway. "If taxes go up any further it would exacerbate the flight out of the city," Newman said.
But for some of those who have seen Detroit struggle for years, bankruptcy is starting to look like the least awful option - even though it will be painful.
"I think...off and on, that it wouldn't be a bad idea," said former Ford chief financial officer Allan Gilmour, now the president of Detroit's Wayne State University. "Let's clean this out once and for all."
By Scott Malone and Ben Berkowitz
After four years of belt-tightening, American companies are good at squeezing more profit out of every dollar of sales - a skill that chief executives regard as critical in the face of an uncertain economy.
While the headline-making cuts of the last recession - when companies shed tens of thousands of workers as they scrambled to lower costs - have mostly passed, they have kept their focus on finding lots of small steps to improve earnings.
For some companies, the changes are relatively simple. McDonald's was able to beat Wall Street's profit forecasts by keeping its locations open on Christmas and rolling out the cult favorite McRib sandwich in December.
For others, pumping up the results involves a more complicated dance, keeping costs down while still spending enough on research and development to ensure they have a steady stream of new products to rely on.
Toothpaste and detergent maker Procter & Gamble reported a 12 percent rise in fourth quarter earnings on 2 percent sales growth, reflecting both cost controls - it cut more than 5,000 jobs last year - and new products, said Chief Executive Bob McDonald.
"You've got to do both at the same time. You have to do innovation and productivity at the same time," McDonald said in an interview.
Conglomerate Honeywell International, which reported a 6 percent rise in profit on 1 percent sales growth, faced a similar challenge.
"We want to be able to do everything right and fast," said CEO David Cote. "In a slow-growth global economy, this becomes especially important for margin rate growth."
More broadly, companies in the Standard & Poor's 500 index that have reported quarterly results so far this earnings season have averaged a 7.7 percent rise in profit on 5.2 percent revenue growth.
Management consultants say that is due, in part, to a renewed focus on spending to grow.
"I'm seeing organizations being very, very disciplined. They are willing to invest, but they are only willing to invest where they see tangible returns," said David Axson, a managing director in Accenture's finance and enterprise performance consulting group who works with Fortune 100-level CFOs. "Profit opportunities are very transitory at the moment.
Little Fat to Trim
Corporate America has become far more selective in its cutting, largely because it has already become so lean.
"They have done a phenomenal job of becoming more efficient," said JJ Kinahan, chief derivatives strategist at TD Ameritrade in Omaha. "There's not a company now that can actually survive with any fat on the bones."
Honeywell's focus on margin improvement is constant and extends across most of the company - from tweaking manufacturing processes to make products with less waste, to focusing on newer products that face less competition and can command higher prices, said Chief Financial Officer Dave Anderson.
"It's not just squeezing," Anderson said in a telephone interview. "Anybody can do that on a short-term basis, but you can't sustain it."
Companies have continued to find fat to trim, though.
Lockheed Martin, the Pentagon's biggest supplier, is facing huge defense spending cutbacks that could trim sales as much as 6 percent this year. But still, it forecast profits would rise as much as 9 percent in 2013, even without layoffs, as it takes steps to reduce pension costs by pre-funding to reduce future liabilities.
Diversified manufacturer 3M said it would cut about 300 workers as it merges its security and traffic safety businesses. That is a relative drop in the bucket for a company that employs some 84,000 people worldwide, but is a key part of CEO Inge Thulin's plan to fix or sell underperforming parts of the company.
Thulin, who took the reins at the maker of Post-It notes and film used in television screens, has identified a handful of units where he has similar concerns. He is also raising the company's research and development budget to 6 percent of sales this year from 5.5 percent in 2012.
One analyst said companies need to cut costs, but also need to ensure they are cutting the right ones and not expenses such as research and development that will lead to future growth.
"There is a generation of managers out there that experienced the recession, understand what the ramifications are of carrying too much cost into one of these cycles and, as a result, are very focused on margins," said Daniel Holland, equity analyst at Morningstar in Chicago, who covers big industrial companies. "That's a mark of management post the recession."
The continued success of companies has boosted investor confidence and helped send the S&P 500 up almost 5 percent since the start of the year. Investors had been very conservative about their expectations for earnings growth because of such things as wrangling in Washington over the "fiscal cliff" of drastic tax increases and budget cuts.
"The bar was so low and that was because of things that happened in the fourth quarter, particularly Hurricane Sandy and its impact, and the fiscal cliff impact, and I think things are not turning out as bad as analysts anticipated," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont.
"You're seeing some individual stocks get hammered because expectations were unrealistic and you're seeing other stocks rally because expectations were set much too low."
Amid all the cost-cutting, there is also a sense among some companies that the situation in Europe is not as dire as it had been, an added bonus in year-end results.
Of course, there are still problems: Top U.S. auto parts supplier Johnson Controls warned that lower European auto production would hurt results this quarter, news that overwhelmed a strong fourth-quarter profit.
But for others, it is clear that Europe is, at a minimum, less of a headache.
"We have seen signs of stabilization, particularly in Europe," said Greg Hayes, chief financial officer at United Technologies Corp, which has also benefited from the recent strengthening of the euro against the dollar, which raises the value of its dollar sales in the eurozone.
China, meanwhile, was a big boost for many companies. 3M notched its best quarter in a year in China, reporting 16 percent growth in organic sales. P&G reported "high single digit" percentage growth and Starbucks Corp saw China/Asia-Pacific sales rise 11 percent.
However, be it cutting costs, or restructuring operations, or any other means in the executive tool kit, the laser focus on margins reflects CEOs who remain wary of the economy souring again.
"I see very little downside in being prepared for the downside," Honeywell's Cote added.
If you're an early bird, you'll be able to start filing your federal income in less than a week - and you'll want to make sure you can claim all of the tax breaks you deserve.
Read more: 5 Ways to Earn Extra Cash in 2013)
After the late tax law changes enacted on January 2, the Internal Revenue Service had to update forms and processing systems. But starting January 30, the vast majority of tax filers - more than 120 million U.S. households - should be able to start filing their taxes either electronically or with paper returns.
Here are three tax easy ways to cut down your tax bill and potentially get a much bigger refund:
State sales taxes
You have the choice of which to deduct on your federal return: your state sales tax or your state income tax. You can pick the one that gives you the biggest deduction. This was a perk that expired at the end of 2011, but it's back now for your 2012 taxes! If your state doesn't have an income tax, it's a no brainer: write-off your state sales taxes. If you live in a state with an income tax, crunch the numbers on the sales tax calculator on the IRS website to figure out which will give you the biggest break.
If you were looking for a job in 2012, I hope you kept track of your job-search expenses, including the cost of printing resumes, business cards, mailings, employment-agency fees, food, hotels, cab fares, and travel.
(Read more: 5 Ways to Counter the Impact of the Payroll Tax Hike)
That's pretty much everything related to your job hunt. You can even deduct 55 cents per mile for driving your own car to a job interview, plus parking and tolls. If you were looking for a position in the same line of work, these job-hunting expenses are considered "miscellaneous expenses" and are deductible -- as long as you itemize and your total miscellaneous expenses exceed two percent of your adjusted gross income.
Out-of-pocket charitable deductions
Don't forget to count up your little philanthropic gestures in 2012 as well as big charitable gifts. Look at all of the out-of-pocket expenses that you paid for while doing work for a charity. The pizza, drinks, and desserts you bought for a fundraiser at your kid's school count as a charitable contribution. If you drove your car to Girl Scout or Boy Scout activities or events with another non-profit organization that you are involved in, you can deduct 14 cents per mile, plus parking and tolls.
You'll may soon find your little charitable contributions add up quickly. Just make sure you have documentation to back up these deductions before you file your return.
Once you've whittled down your tax bill, filing electronically is the safest, fastest and easiest way to submit your return. You with these deductions, you may find you'll get back a refund that's even bigger than you expected. If Uncle Sam winds up owing you money, the IRS says you'll get your refund much faster if you e-file and request direct deposit.
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