Find room for God in fast-paced world, pope says on Christmas eve

Pope Benedict, leading the world's Roman Catholics into Christmas, on Monday urged people to find room for God in their fast-paced lives filled with the latest technological gadgets.
The 85-year-old pope, marking the eighth Christmas season of his pontificate, celebrated a solemn Christmas Eve mass in St Peter's Basilica, during which he appealed for a solution to the Arab-Israeli conflict and an end to the civil war in Syria.
At the mass for some 10,000 people in the basilica and broadcast to millions of others on television, the pope wove his homily around the theme of God's place in today's modern world.
"Do we have time and space for him? Do we not actually turn away God himself? We begin to do so when we have no time for him," said the pope, wearing gold and white vestments.
"The faster we can move, the more efficient our time-saving appliances become, the less time we have. And God? The question of God never seems urgent. Our time is already completely full," he said.
The leader of the world's some 1.2 billion Roman Catholics said societies had reached the point where many people's thinking processes did not leave any room even for the existence of God.
"Even if he seems to knock at the door of our thinking, he has to be explained away. If thinking is to be taken seriously, it must be structured in such a way that the 'God hypothesis' becomes superfluous," he said.
"There is no room for him. Not even in our feelings and desires is there any room for him. We want ourselves. We want what we can seize hold of, we want happiness that is within our reach, we want our plans and purposes to succeed. We are so 'full' of ourselves that there is no room left for God."
PEACE CANDLE
Bells inside and outside the basilica chimed when the pope said "Glory to God in the Highest," the words the gospels say the angels sang at the moment of Jesus' birth.
Earlier on Monday the pope appeared at the window of his apartments in the apostolic palace and lit a peace candle, as a larger-than-life nativity scene was unveiled in St Peter's Square below.
Reflecting on the gospel account of Jesus born in a stable because there was no room for Mary and Joseph in the inn, he said when people find no room for God in their lives, they will soon find no room for others.
"Let us ask the Lord that we may become vigilant for his presence, that we may hear how softly yet insistently he knocks at the door of our being and willing.
"Let us ask that we may make room for him within ourselves, that we may recognise him also in those through whom he speaks to us: children, the suffering, the abandoned, those who are excluded and the poor of this world," he said.
He asked for prayers for the people who "live and suffer" in the Holy Land today.
The pope called for peace among Israelis and Palestinians and for the people of Syria, Lebanon and Iraq and prayed that "Christians in those lands where our faith was born may be able to continue living there, that Christians and Muslims may build up their countries side-by-side in God's peace."
The Vatican is concerned about the exodus from the Middle East of Christians, many of whom leave because they fear for their safety. Christians now comprise five percent of the population of the region, down from 20 percent a century ago.
According to some estimates, the current population of 12 million Christians in the Middle East could halve by 2020 if security and birth rates continue to decline.
At noon (1100 GMT/6 AM ET) the pope will deliver his twice-yearly "Urbi et Orbi" (to the city and the world) blessing and message from the central balcony of St Peter's Basilica.

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Future of state estate taxes hangs on U.S. "fiscal cliff"

Falling off the "fiscal cliff" is a bad thing, right?
Not necessarily for some state governments that could begin collecting more in estate taxes on wealth left to heirs if the United States goes over the "cliff," allowing sharp tax increases and federal spending cuts to take effect in January.
In an example of federal and state tax law interaction that gets little notice on Capitol Hill, 30 states next year could collect $3 billion more in estate taxes if Congress and President Barack Obama do not act soon, estimated the Urban-Brookings Tax Policy Center, a Washington think tank.
The reason? The federal estate tax would return with a vengeance and so would a federal credit system that shares a portion of it with the 30 states. They had been getting their cut of this tax revenue stream until the early 2000s. That was when the credit system for payment of state estate tax went away due to tax cuts enacted under former President George W. Bush.
With the return of the credit system next year as part of the "cliff," states such as Florida, Colorado and Texas - which have not collected estate tax since 2004 - could resume doing so. California Governor Jerry Brown has already begun to add the anticipated estate tax revenue into his plans, including $45 million of it in his 2012-2013 revised budget.
Brown may or may not be jumping the gun.
CLOUDY CLIFF AHEAD
The outlook on the "fiscal cliff" coming up at year-end is uncertain. Democratic President Barack Obama has said he hopes for a last-minute deal to avert it. That would need to get done soon, with Congress just now coming back from its holiday break.
Chances of an agreement became more remote last week after Republicans in the U.S. House of Representatives fumbled their own legislative attempt to prevent the fiscal jolt that economists say could trigger a recession.
House Speaker John Boehner abruptly adjourned the chamber for the holidays after failing to gather the votes from within his own party to pass legislation he and other Republicans had drafted, after walking out of negotiations with Obama.
Weeks of inconclusive political drama over the "cliff" have focused largely on individual income tax rates and spending on federal programs such Medicare and Social Security, but many tax issues are also involved, including the estate tax.
At the moment, under laws signed a decade ago by Bush, the estate tax is applied to inherited assets at a rate of 35 percent after a $5 million exemption. That means a deceased person can pass on an inheritance of up to $5 million before any tax applies. Inherited wealth passed to a spouse or a federally recognized charity is generally not taxed.
Obama wants to raise the rate to 45 percent after a $3.5 million exemption. Republicans have called for complete repeal of the estate tax, which they call the "death tax," though Boehner earlier this month called for freezing the estate tax at its present level. It was difficult to determine what the Republicans want after last week's events in the House.
STATES STAND TO GAIN
If Congress and Obama do not act by December 31, numerous Bush-era tax laws will expire, including the one on estate taxes. That would mean the estate tax rate will shoot up next year to the pre-Bush levels of 55 percent after a $1 million exemption.
It would also mean that for the first time in years, a portion of that estate tax would go to the states, through the return of the credit system.
Under that old law, estates paying the tax could get a credit against their federal tax bill for state estate tax payments of up to 16 percent of the estate's value.
If the fiscal cliff were allowed to take hold unaltered by Washington, 30 states would again automatically begin getting their share of federal estate taxes. The state laws are generally written so the state estate tax amounts are calculated under a formula based on the amount of the federal credit.
This would help states that have struggled with lower tax revenues since the 2007-2009 financial crisis and resulting recession, according to research by the Pew Center on the States, though painful federal spending cut backs would also hurt the states.

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Stranded by winter storm? Tips for fliers

A massive winter storm is disrupting travel plans for tens of thousands of fliers trying to get home after Christmas. Snow, thunderstorms, sleet, tornados and high winds have grounded planes in the nation's midsection and are expected to slow operations on the East Coast.
Delays racked up from Dallas to Indianapolis to Chicago. By 3 p.m. EST Wednesday, more than 1,100 flights nationwide had been scrapped, according to flight tracking site FlightAware.com.
More cancelations are likely throughout the evening, with Washington, New York and Philadelphia expected to see the largest problems. For instance, wind gusts at New York's John F. Kennedy International Airport could exceed 50 mph Wednesday night, according to FlightAware.
Passengers are pretty much at the mercy of Mother Nature and the airlines. But there are a few things they can do to improve their odds of getting home quickly.
— If you miss your connection, the airlines will automatically rebook you on the next available flight. However, with flights at near capacity, the next open seat could be several days away. Two years ago, some Christmas fliers had to wait nearly a week to get home.
— If you're unhappy with your rebooked flight, get in line to speak to a customer service representative. But also, pick up the phone and call the airline directly, go onto the airline's website and even consider sending a Tweet.
— Consider buying a one-day pass to the airline lounge. It's a nice place to relax away from the crowd and there are usually free drinks and small snacks. But the real secret to the lounges is that the airline staffs them with some of its best — and friendliest — ticket agents. The lines inside will be much shorter and these agents are magically able to find empty seats where nobody else can. One-day passes typically cost $50 per person.

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Retailers pull stocks lower on poor holiday sales

For the stock market, this week hasn't been the most wonderful time of the year.
U.S. stocks fell Wednesday for the third trading day in a row. Disappointing holiday sales weighed heavy on retail companies, and the unwelcome "fiscal cliff" package of higher taxes and lower government spending loomed nearer.
The Dow Jones industrial average slipped 24.49 points to 13,114.59. The Standard & Poor's 500 index fell 6.83 to 1,419.83 and the Nasdaq composite lost 22.44 to 2,990.16.
Karyn Cavanaugh, market strategist with ING Investment Management in New York, wrote a note to clients Wednesday highlighting the less-than-merry retail sales.
"I hope that they're reading this from the mall," she said later, "because retail sales could use a boost."
The MasterCard Advisors SpendingPulse report found that sales of electronics, clothing, jewelry and home goods increased just 0.7 percent in the two months before Christmas compared with the same period last year.
That was well below the 3 to 4 percent that analysts had expected and the worst performance since 2008, when spending shrank during the depths of the Great Recession.
Major U.S. retailers including Abercrombie & Fitch, Sears Holdings, Urban Outfitters, Limited Brands, Nike and Gap were all down. Handbag maker Coach, a bellwether of the luxury market, plummeted $3.39 to $54.13. It lost nearly 6 percent of its value, more than any other company in the S&P 500.
Right behind it was online retailer Amazon.com, which helps analysts get a read on the entire retail market. It lost nearly 4 percent, falling $9.99 to $248.63.
Plodding retail sales are a concern because consumer spending accounts for roughly 70 percent of the U.S. economy. When shoppers pull back on spending, that can take a chunk out of company earnings, which in turn pushes down the stock market.
The retail numbers are also a sign that despite scattered hints of an improving economy, including a report Wednesday about rising home prices, many consumers remain uneasy about their prospects.
"Consumers just aren't confident," said Jeff Sica, president and chief investment officer of SICA Wealth Management in Morristown, N.J. "They don't feel a sense of security that they're going to be able to maintain their job or their income or their savings."
Sica pointed out that normally the market rises at this time of year — the so-called Santa Claus rally. Since 1969, stocks have risen an average of 1.6 percent over the last five days of December and the first two of January, according to The Stock Trader's Almanac.
This year, it seems, the retail sales and "fiscal cliff" have been too much of an overhang.
The "fiscal cliff" refers to lower government spending and higher taxes that will kick in Jan. 1, if Republicans and Democrats can't agree to a new budget by then.
The Senate is due in session Thursday, and President Barack Obama is expected to return early from his Christmas vacation in Hawaii, arriving back in Washington early Thursday. Still, congressional officials said Wednesday they knew of no significant strides toward a compromise over the long Christmas weekend, and no negotiations have been set.
It's not clear that the market would automatically rise if there is a deal, or automatically fall if there isn't. Except for the past three days, the market has risen more or less steadily since mid-November despite the lack of a "fiscal cliff" deal. That means many traders have been assuming that lawmakers would work out something before the deadline, so any positive effect from a compromise is already baked into stock prices.
While a compromise is still possible, some analysts said that what the market feared most wasn't the cliff, but the possibility that lawmakers would come up with only a stop-gap solution. That would probably mean they'd have to meet again in the new year to hammer out a permanent deal, dragging out the uncertainty.
"It's like ripping the Band-Aid off now versus later," Cavanaugh said. "The Band-Aid's got to come off. We've got to cut spending, we've got to pay down the debt."
The bright spot was a report from the Standard & Poor's/Case-Shiller national home price index, which said that home prices rose in most major U.S. cities in October compared with a year ago. However, prices fell in many cities compared to the month before.
The yield on the benchmark 10-year Treasury note edged down to 1.75 percent from 1.77 percent Monday, a sign that investors were taking money out of stocks and putting it into bonds.
It was the first trading day after the Christmas holiday. Trading volume was low, and European markets were still closed.
Just 2.3 billion shares were traded on the New York Stock Exchange. For the year so far, the average has been around 3.6 billion.

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Fees undermine fliers' ability to compare fares

For many passengers, air travel is only about finding the cheapest fare.
But as airlines offer a proliferating list of add-on services, from early boarding to premium seating and baggage fees, the ability to comparison-shop for the lowest total fare is eroding.
Global distribution systems that supply flight and fare data to travel agents and online ticketing services like Orbitz and Expedia, accounting for half of all U.S. airline tickets, complain that airlines won't provide fee information in a way that lets them make it handy for consumers trying to find the best deal.
"What other industry can you think of where a person buying a product doesn't know how much it's going to cost even after he's done at the checkout counter?" said Simon Gros, chairman of the Travel Technology Association, which represents the global distribution services and online travel industries.
The harder airlines make it for consumers to compare, "the greater opportunity you have to get to higher prices," said Kevin Mitchell, chairman of the Business Travel Coalition, whose members include corporate travel managers.
Now the Obama administration is wading into the issue. The Department of Transportation is considering whether to require airlines to provide fee information to everyone with whom they have agreements to sell their tickets. A decision originally scheduled for next month has been postponed to May, as regulators struggle with a deluge of information from airlines opposed to regulating fee information, and from the travel industry and consumer groups that support such a requirement.
Meanwhile, Spirit Airlines, Allegiant Air and Southwest Airlines — with backing from industry trade associations — are asking the Supreme Court to reverse an appeals court ruling forcing them to include taxes in their advertised fares. The appeals court upheld a Transportation Department rule that went in effect nearly a year ago that ended airlines' leeway to advertise a base airfare and show the taxes separately, often in smaller print. Airlines say the regulations violate their free-speech rights.
At the heart of the debate is a desire by airlines to move to a new marketing model in which customers don't buy tickets based on price alone. Instead, following the well-worn path of other consumer companies, airlines want to mine personal data about customers in order to sell them tailored services. You like to sit on the aisle and to ski, so how would you like to fly to Aspen with an aisle seat and a movie, no extra baggage charge for your skis, and have a hotel room and a pair of lift tickets waiting for you, all for one price? You're a frequent business traveler. How about priority boarding, extra legroom, Internet access and a rental car when you arrive?
"Technology is changing rapidly. We are going to be part of the change," said Sharon Pinkerton, vice president of Airlines for America, which represents most U.S. carriers. "We want to be able to offer our customers a product that's useful to them, that's customized to meet their needs, and we don't think (the Transportation Department) needs to step in."
If airlines have their way, passengers looking for ticket prices may have to reveal a lot more information about themselves, such as their age, marital status, gender, nationality, travel history and whether they're flying for business or leisure. The International Air Transport Association, whose 240 member airlines cover 84 percent of global airline traffic, adopted standards at a meeting earlier this month in Geneva for such information gathering by airlines as well as by travel agents and ticketing services that would relay the data to airlines and receive customized fares in return.
"Airlines want, and expect, their (ticket) distribution partners to offer passengers helpful contextual information to make well-informed purchase decisions, reducing the number of reservations made based primarily or exclusively on price," said a study commissioned by the association.
Consumer advocates question how airlines would safeguard the personal information they gather, and they worry that comparison shopping for the cheapest air fares will no longer be feasible.
"It's like going to a supermarket where before you get the price, they ask you to swipe your driver's license that shows them you live in a rich zip code, you drive a BMW, et cetera," Mitchell said. "All this personal information on you is going out to all these carriers with no controls over what they do with it, who sees it and so on."
The airline association said consumers who choose not to supply personal information would still be able to see fares and purchase tickets, though consumer advocates said those fares would probably be at the "rack rate" — the travel industry's term for full price, before any discounts.
It's up to individual airlines whether they price fares differently for travelers who don't provide personal information, said Perry Flint, a spokesman for the international airline association.
The stakes, of course, are enormous. Since 2000, U.S. airlines have lost money for more years than they've made profits. Fee revenue has made a big difference in their bottom lines. Globally, airlines raked in an estimated $36 billion this year in ancillary revenue, which includes baggage fees and other a la carte services as well as sales of frequent flyer points and commissions on hotel bookings, according to a study by Amadeus, a global distribution service, and the IdeaWorksCompany, a U.S. firm that helps airlines raise ancillary revenue. U.S. airlines reported collecting nearly $3.4 billion in baggage fees alone in 2011.
One expense airlines would like to eliminate is the $7 billion a year they pay global distribution systems to supply flight and fare information to travel agents and online booking agents like Expedia. Airlines want to deal more directly with online ticket sellers and travel agents, who dominate the lucrative business travel market. Justice Department officials have acknowledged an investigation is underway into possible anti-trust violations by distribution companies.
Airlines also have been cracking down on websites that help travelers manage their frequent flier accounts. The sites use travelers' frequent flier passwords to obtain balances and mileage expiration dates, and then display the information in a way that makes it easier for travelers to figure out when it makes more sense to buy a ticket or to use miles.
"What the airlines are trying to do right now is reinvent the wheel so they can hold all their information close to their chest," said Charles Leocha, founder of the Consumer Travel Alliance. "As we move forward in a world of IT, the ownership of passenger data is like gold to these people."
By withholding information like fee prices, he said, "we are forced to go see them, and then we are spoon-fed what they want to feed us."

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U.S. retailers scramble after lackluster holiday sales

The 2012 holiday season may have been the worst for retailers since the 2008 financial crisis, with sales growth far below expectations, forcing many to offer massive post-Christmas discounts in hopes of shedding excess inventory.
While chains like Wal-Mart Stores Inc and Gap Inc are thought to have done well, analysts expect much less from the likes of book seller Barnes & Noble Inc and department store chain J. C. Penney Co Inc.
Shares of retailers dropped sharply on Wednesday, helping drag broader indexes lower, as investors realized they were likely to be disappointed when companies start to report results in a few weeks' time.
"The broad brush was Christmas wasn't all that merry for retailers, and you have to ask what those margins look like if the top line didn't meet their expectations," said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group.
Growth was always expected to slow this season, though an improving employment picture and rising home values had helped mitigate the worst fears. But then Superstorm Sandy hit the East Coast in late October, mild weather blunted sales of winter clothing and rising concern about the "fiscal cliff" became more of a reality, dragging down already-pessimistic forecasts.
The latest sign of trouble came from MasterCard Advisors Spending Pulse, which reported holiday-related sales rose 0.7 percent from October 28 through December 24, compared with a 2 percent increase last year.
The preliminary estimate from SpendingPulse was in line with other estimates showing weak growth during the holiday season, when retailers can book about 30 percent of annual sales - and in many cases, half of their profit.
"It has been a very uneven industry performance, probably at least for the last year, and that certainly continued into the holiday season," said Michael Niemira, chief economist at the International Council of Shopping Centers, in an interview with Reuters Insider.
The latest holiday season could end up the weakest since 2008, during the last recession, when sales actually declined. The National Retail Federation had previously predicted 4.1 percent sales growth this year, versus a 5.6 percent increase a year earlier.
Markets reacted sharply to the gloomy outlook.
The S&P retail index closed down 1.7 percent, and 14 of the top 20 decliners in the broader S&P 500 were retailers or consumer brands.
INVENTORY CRUSH
To be sure, the actual percentage change in holiday sales can differ substantially, depending on which group is calculating the figure. SpendingPulse and the National Retail Federation, for example, look at different categories, which can cause some variation in their forecasts.
Regardless of how bad the figure is, one concern for retailers is that soft sales will mean an excess of inventory that will force some to slash prices.
The day after Christmas, retailers were using deep discounts to lure shoppers. Among other brands, Barnes & Noble offered 50 percent discounts in stores via email promotions on Wednesday, while Ann Inc had half-off at its Loft stores, and Macy's Inc's Bloomingdale's promoted discounts of up to 75 percent in some cases.
At a Target store in New York City's Harlem neighborhood, most shoppers seemed to be spending more on groceries, toys and small gifts than on gadgets or clothes.
Despite discounts of 50 percent, there were few takers for Jason Wu glass ornaments, Oscar de la Renta canvas totes and other designer goods launched under the mass merchant's tie-up with upscale chain Neiman Marcus.
Even in a good year, retailers would have offered discounts to lure customers, but some suggest a weak year has now forced their hands.
"Retailers are no longer chasing sales, they are chasing inventory management. That means the discounts that they would have liked to be at 50-60 (percent) off have climbed to 75 to even 80 (percent) off," said Marshal Cohen, chief industry analyst at The NPD Group.
This week's cold, snowy weather on the heels of a warm start to December could spur people to use the gift cards they received or their remaining discretionary income to buy everything from jackets to snow blowers, said Evan Gold, senior vice president of client services at Planalytics, which tracks weather for businesses including retailers.
In December, he said, "people are out spending anyway, weather can trigger what you purchase, not if you purchase, but what you purchase."
SANDY AND CLIFF
A variety of factors were thought to be at fault for the weak season, starting with Superstorm Sandy, which depressed sales in the U.S. Northeast in late October and early November.
Sales recovered in the second part of November, with early hours and promotions helping drive traffic during the "Black Friday" weekend after Thanksgiving, analysts said.
But there was a deep lull in early December as a winter storm in parts of the United States may have limited sales, said Michael McNamara, vice president of research and analysis at MasterCard SpendingPulse.
On top of that, there were fears that taxes will rise in the new year if Washington cannot negotiate a solution to the end-of-year "fiscal cliff" dilemma.
A recent Ipsos poll for Reuters found that only 17 percent of shoppers were spending less due to cliff fears, though analysts said the damage was still done.
"The government usually does not have a role in holidays but this year they did. They got right in the midst of it, the timing couldn't have been any worse," NPD's Cohen said.
BRIGHT SPOTS
One bright spot has been online sales, which continue to grow at a faster pace.
On Christmas Day, online sales jumped 22.4 percent, outpacing the 16.4 percent increase in 2011, according to IBM Digital Analytics Benchmark, which tracks more than 1 million e-commerce transactions a day from 500 U.S. retailers.
Whether online or off, some of the winning retailers were expected to be Wal-Mart, which attracted shoppers with early deals on the night of Thanksgiving and kept its focus on value, and apparel chains like the Gap, whose bright sweaters were successful, according to analysts.
Toys sold well, and hot items that were harder to find later in the season included certain Mattel Inc Barbie dolls and LeapFrog Enterprises Inc's LeapPad2 tablet computer, according to B. Riley Caris analyst Linda Bolton Weiser.
For retailers that have struggled, analysts said all hope was not lost. Many have fiscal quarters that end in January, so they still have time to benefit from a post-Christmas rebound. Because Christmas fell on a Tuesday, some said they could even see a boost this week from people who have extra time off.
"There's still a little bit more time to go until the holiday season is officially over," Morningstar analyst Peter Wahlstrom said.
Wal-Mart shares ended down 0.8 percent at $67.99 on Wednesday, while Macy's shares were down 1.1 percent at $37.11, Barnes & Noble shares were down 3.5 percent at $14.49, Amazon.com Inc shares ended 3.9 percent lower at $248.63, and Ann Inc shares lost 5.1 percent to close at $32.06.

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Catholic Church urges Irish to oppose abortion law

The head of Ireland's Catholic Church urged followers in his Christmas Day message to lobby against government plans to legalize abortion.
Ireland, the only EU member state that currently outlaws the procedure, is preparing legislation that would allow limited access to abortion after the European Court of Human Rights criticized the current regime.
The death last month of an Indian woman who was denied an abortion of her dying foetus and later died of blood poisoning has intensified the debate around abortion, which remains a hugely divisive subject in the predominantly Catholic country.
"I hope that everyone who believes that the right to life is fundamental will make their voice heard in a reasonable, but forthright, way to their representatives," Cardinal Sean Brady said in a Christmas message on Tuesday.
"No government has the right to remove that right from an innocent person."
Irish Prime Minister Enda Kenny, a regular Mass goer, is bringing in legislation that would allow a woman to have an abortion if her life was at risk from pregnancy.
The country's Supreme Court ruled in 1992 that abortion was permitted when a woman's life was at risk but successive governments have avoided legislating for it because it is so divisive.
The death of Savita Halappanavar, who repeatedly asked for an abortion while she was miscarrying in an Irish hospital, highlighted the lack of clarity in Irish law that leaves doctors in a legally risky position.
Halappanavar's death re-ignited the abortion debate and prompted large protests by groups both in favor of and against abortion.
Kenny and his conservative Fine Gael party have been criticized for tackling the abortion issue and some party members have indicated that they may not be able to back the law.
Relations between the Irish government and the once dominant Catholic Church are at an all-time low in the wake of years of clerical sex abuse scandals.
Kenny told parliament last year that the Vatican's handling of the scandals had been dominated by "elitism and narcissism" and accused it of trying to cover up the abuse. The speech prompted the Vatican to recall its ambassador, or nuncio, to Ireland.
Brady, who has faced calls this year to resign over accusations he failed to warn parents their children were being sexually abused, said in his Christmas message that he wanted relations with government to improve.
"My hope is that the year ahead will see the relationship between faith and public life in our country move beyond the sometimes negative, exaggerated caricatures of the past.

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Lawmakers play waiting game with 'fiscal cliff' deadline in sight

With only a week left before a deadline for the United States to go over a "fiscal cliff," lawmakers played a waiting game on Monday in the hope that someone will produce a plan to avoid harsh budget cuts and higher taxes for most Americans from New Year's Day.
Though Republicans and Democrats have spent the better part of a year describing a plunge off the cliff as a looming catastrophe, the nation's capital showed no outward signs of worry, let alone impending calamity.
The White House has set up shop in Hawaii, where President Barack Obama is vacationing.
The Capitol was deserted and the Treasury Department - which would have to do a lot of last-minute number-crunching with or without a deal - was closed.
So were all other federal government offices, with Obama having followed a tradition of declaring the Monday before a Tuesday Christmas a holiday for government employees, notwithstanding the approaching fiscal cliff.
Expectations for some 11th-hour rescue focused largely on Senate Minority Leader Mitch McConnell, a Republican, in part because he has performed the role of legislative wizard in previous stalemates.
But McConnell, who is up for re-election in 2014, was shunning the role this year, his spokesman saying that it was now up to the Democrats in the Senate to make the next move.
"We don't yet know what Senator Reid will bring to the floor. He is not negotiating with us and the president is out of town," said McConnell's spokesman, referring to Senate Majority Leader Harry Reid, a Democrat. "So I just don't know what they're going to do over there," he said.
Two-day-old tweets on leadership websites told the story insofar as it was visible to the public.
House Speaker John Boehner's referred everyone to McConnell. McConnell's tweet passed the responsibility along to Obama, saying it was a "moment that calls for presidential leadership."
Reid's tweet said: "There will be very serious consequences for millions of families if Congress fails to act" on the cliff.
The next session of the Senate is set for Thursday, but the issues presented by across-the-board tax hikes and indiscriminate reductions in government spending, were not on the calendar.
The House has nothing on its schedule for the week, but members have been told they could be called back at 48 hours notice, making a Thursday return a theoretical possibility.
However, aides to the Republican leaders in Congress said there were no talks with Democrats on Monday and none scheduled after negotiations fell off track last week when Boehner failed to persuade House Republicans to accept tax increases on incomes of more than $1 million a year.
"Nothing new, Merry Christmas," an aide to Boehner responded when asked if there was any movement on the fiscal cliff.
But a senior Obama administration official, speaking on condition of anonymity, said White House aides were talking with Senate Democratic staffers about the situation.
SCALED-BACK EXPECTATIONS
If there is some last-minute legislation, Republicans and Democrats agreed on Sunday news shows that it will not be any sort of "grand bargain" encompassing taxes and spending cuts, but most likely a short-term deal putting everything off for a few weeks or months, thereby risking a negative market reaction.
A limited agreement would still need bipartisan support, as Obama has said he would veto a bill that does not raise taxes on the wealthiest Americans.
On Monday, Texas Senator Kay Bailey Hutchison urged fellow Republicans to be flexible.
"We're now at a point where we're not going to get what we think is right for our economy and our country because we don't control government. So we've got to work within the system we have," she told MSNBC.
Two bills in Congress could conceivably form the basis for a last-minute stopgap measure.
Last spring, Republicans in the House passed a measure that would extend Bush-era tax cuts for everyone, reflecting the party's deep reluctance to increase taxes.
The Democratic-controlled Senate passed a bill in August, extending lower tax rates for everyone except the wealthiest Americans - a group defined at that point as households with a net income of $250,000 or above. Obama has since increased that to $400,000 a year, in an effort to win Republican support.
Analysts say Democrats might be able to get the backing of enough Republicans in both the House and Senate, especially if they are willing to raise the number to $500,000.
Under that scenario, lawmakers might also put off spending cuts of $109 billion that would take effect from January and agree to Republican demands for cuts in entitlement programs such as Medicare and Medicaid, the government-run health insurance plans for seniors and the poor.
However, with only a few work days left in Congress after Christmas, there is a good chance that no deal can be worked out and tax rates would then go up, at least briefly, until an agreement is reached in Washington.
"We may go off the cliff on January 1, but we would correct that very quickly thereafter," Democratic Representative John Yarmuth told MSNBC.
The prospects of the United States going over the fiscal cliff dampened enthusiasm on Wall Street for a "Santa rally" in the holiday season, when stocks traditionally rise.
The Dow Jones industrial average dropped 51.76 points, or 0.39 percent, in Monday's shortened holiday session.
Failure to work out tax rates in the coming days would cause chaos at the Internal Revenue Service, said analyst Chris Krueger of Guggenheim Securities.
"Next weekend is going to be a total, total debacle," he said. The IRS is unlikely to have enough time to revise its tables for withholding taxes.
"The withholding tables are sort of like an aircraft carrier, you can't turn the thing on a dime." he said.

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Venezuela's Chavez improving after surgery: officials

 Venezuelan President Hugo Chavez is improving after a cancer operation in Cuba and has started exercising, officials said on Monday, amid doubts over whether the former soldier is in good enough health to continue governing.
Vice President Nicolas Maduro said he had spoken by phone with Chavez, who was walking and doing exercises as part of his treatment.
"We've gotten the best present we could get this Christmas: a phone call from our commander president," Maduro said on state television.
Information Minister Ernesto Villegas said earlier in the day that Chavez had "shown a slight improvement in his condition," without providing details.
Chavez has not been heard from in two weeks following a fourth operation for an unspecified type of cancer in the pelvic region. The government has said he suffered post-operatory complications including unexpected bleeding and a lung infection, but offered few details about his actual condition.
His death, or even his resignation for health reasons, would upend the politics of the South American OPEC nation where his personalized brand of oil-financed socialism has made him a hero to the poor but a pariah to critics who call him a dictator.
His allies are now openly discussing the possibility that he may not be back in time to be sworn in for his third six-year term on the constitutionally mandated date of January 10.
Opposition leaders say a delay to his taking power would be another signal that Chavez is not in condition to govern and that fresh elections should be called to choose his replacement.
They believe they have a better shot against Maduro, Chavez's anointed successor, than against the charismatic president who for 14 years has been nearly invincible at the ballot box.
But a constitutional dispute over succession could lead to a messy transition toward a post-Chavez era.
Maduro has become the government's main figurehead in the president's absence. His speeches have mimicked Chavez's bombastic style that mixes historical references with acid insults of adversaries.
Opposition leader Henrique Capriles, who lost to Chavez in the October presidential vote, slammed Maduro in an interview published on Sunday for failing to seek dialogue with the opposition at a time of political uncertainty.
"Maduro is not the one that won the elections, nor is he the leader," Capriles told the local El Universal newspaper. "Because Chavez is absent, this is precisely the time that (Maduro) needs help from people (in the opposition camp)."
Chavez has vastly expanded presidential powers and built a near-cult following among millions of poor Venezuelans, who love his feisty language and social welfare projects.
The opposition is smarting from this month's governors elections in which Chavez allies won 20 of 23 states. They are trying to keep attention focused on day-to-day problems from rampant crime to power outages.

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Japan approves Novo's new combination insulin Ryzodeg

 Danish drugmaker Novo Nordisk said on Tuesday Japan's health regulator had approved its new combination insulin, that it plans to market as Ryzodeg, for the treatment of diabetes.
Ryzodeg is a combination of Novo's new ultra long-acting insulin degludec, or Tresiba, which Japan became the first country to approve in September, and its rapid-acting insulin Novorapid.
Tresiba, Novo's biggest new drug hope, had a setback in November when regulators in the United States, where Novo expects to generate the bulk of sales, said Tresiba has a higher heart safety risk than other diabetes treatments, raising fears that it may not be approved there.
Novo has also filed for approval of the drug in the European Union, Canada, Switzerland and other countries.
Tresiba and Ryzodeg are seen as strong new competitors in the long-acting, or basal, insulin market, which has long been dominated by Sanofi's Lantus. Competition is hotting up in the space, with Eli Lilly also having a promising new contender in development.
Novo has said previously that the exact timing for the launch of Ryzodeg would be decided after a price listing for Tresiba, which it plans to launch in Japan shortly after completion of price talks.

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