The New Old Age Blog: Why Can’t I Live With People Like Me?

“Aging in place” is the mantra of long-term care. Whether looking at reams of survey data, talking to friends or wishing on a star, who among us wouldn’t rather spend the final years — golden or less so — at home, surrounded by our cherished possessions, in our own bed, no cranky old coot as a roommate, no institutional smells or sounds, no lukewarm meals on a schedule of someone else’s making?

That works best, experts tell us, in dense cities, where we can hail a cab at curbside, call the superintendent when something breaks and have our food delivered from Fresh Direct or countless takeout restaurants. We’d have neighbors in the apartment above us, below us, just on the other side of the wall. Hearing their toilets flush and their children ride tricycles on uncarpeted floors is a small inconvenience compared to the security of knowing they are so close by in an emergency.

Urban planners, mindful that most Americans live in sprawling, car-reliant suburbs, are designing more elder-friendly, walkable communities, far from “real” cities. Houses and apartments are built around village greens, with pockets of commerce instead of distant strip malls. Some have community centers for congregate meals and activities; others share gardens, where people can get their hands in the warm spring dirt long after they can push a lawn mower.

All of this is a step in the right direction, despite the Potemkin-village look of so many of them. But it doesn’t take into account those who are too infirm to stay at home, even in cities or more manageable suburban environments. Some are alone, others with a loving spouse who by comparison is “well” but may not be for long, given the rigors of care-taking. It doesn’t take into account people who can’t afford a home health aide, who don’t qualify for a visiting nurse, who have no adult children to help them or whose children live far away.

But by now, aging in place, unrealistic for some, scary or unsafe for others and potentially very isolating, has become so entrenched as the right way to live out one’s life that not being able to pull it off seems a failure, yet another defeat at a time when defeats are all too plentiful. Are we making people feel guilty if they can’t stay at home, or don’t want to? Are we discouraging an array of other solutions by investing so much, program-wise and emotionally, in this sine qua non?

Regular readers of The New Old Age know that I am single, childless and terrified of falling off a ladder while replacing a light bulb, breaking a hip and lying on the floor, unattended, until my dog wails so loudly a neighbor comes by to complain. A MedicAlert pendant is not something that appeals to me at 65, but even if I give in to that, say at 75, I’m not sure my life will be richer for digging my heels in and insisting home is where I should be.

So I spend a lot of time thinking about the alternatives. I know enough to distinguish between naturally-occurring-retirement communities, or NORCs (some of which work better than others); age-restricted housing complexes (with no services); assisted living (which works fine when you don’t really need it and not so fine when you do); and continuing care retirement communities (which require big upfront payments and extensive due diligence to be sure the place doesn’t go belly up after you get there).

What I find so unappealing about all these choices is that each means growing old among people with whom I share no history. In these congregate settings, for the most part, people are guaranteed only two things in common: age and infirmity. Which brings us to what is known in the trade as “affinity” or “niche” communities,” long studied by Andrew J. Carle at the College of Health and Human Services at George Mason University in Fairfax, Va.

Mr. Carle, who trains future administrators of senior housing complexes, was a media darling a few years back, before the recession, with the first baby boomers approaching 65 and niche communities that included services for the elderly — not merely warm-weather developments adjacent to golf courses — expected to explode. In newspaper interviews as recently as 2011, Mr. Carle said there were “about 100 of them in existence or on the drawing board,” not counting the large number of military old-age communities.

Mr. Carle still believes that better economic times, when they come, will reinvigorate this sector of senior housing, after the failure of some in the planning stages and others in operation. In an e-mail exchange, Mr. Carle said there were now about 70 in operation, with perhaps 50 of those that he has defined as University Based Retirement Communities, adjacent to campuses and popular with alumni, as well as non-alumni, who enjoy proximity to the intellectual and athletic activities. Among the most popular are those near Dartmouth, Oberlin, the University of Alabama, Penn State, Notre Dame, Stanford and Cornell.

At the height of the “affinity” boom, L.G.B.T.-assisted living communities and nursing homes were all the rage, seen as a solution to the shoddy treatment that those of different sexual orientations in the pre-Stonewall generation experienced in generic facilities. A few failed, most never got built and, by all accounts, the only one to survive is the pricy Rainbow Vision community in Sante Fe, N.M.

A handful of nudist elder communities, and ones for old hippies, also fell by the wayside, perhaps too free-spirited for the task. According to Mr. Carle, despite the odds, at least one group of RV enthusiasts has added an assisted-living component to what began as collections of transient elderly, looking only for a parking spot and necessary water and power hook-ups for their trailers. Native Americans have made a go of an assisted-living community in Montana, and Asians have done the same in Northern California.

But professional affinity communities, which I find most appealing, are few and far between.

The storied Motion Picture & Television Country House and Hospital, a sliding-scale institution in the San Fernando Valley since 1940, survived near-closure in 2009 as a result of litigation, activism by the Screen Actors Guild and the local chapter of the Teamsters, and news media pressure. Among film legends who died there — along with cameramen, back-lot security guards and extras — were Mary Astor, Joel McCrea, Yvonne De Carlo and Stepin Fetchit.

New York State’s volunteer firefighters are all welcome to a refurbished facility in the Catskill region that offers far more in the way of care and activities, including a state-of-the-art gym, than when I visited there five years ago. At that time, the residents amused themselves by activating the fire alarm to summon the local hook and ladder company, which didn’t mind a bit.

Then there is Nalcrest, the retirement home for unionized letter carriers. Even as post offices nationwide are preparing to eliminate Saturday service, and snail mail becomes an artifact, the National Association of Letter Carriers holds monthly fees around the $500 mark, is located in central Florida so its members no longer have to brave rain and sleet to complete their appointed rounds, and bans dogs, the bane of their existence.

So why not aged journalists? We surely have war stories to embroider as we rock on the porch. Perhaps a mimeograph machine to produce an old-fashioned, dead-tree newspaper, which some of us will miss once it has given way to Web sites like this one. Pneumatic tubes, one colleague suggested, to whisk our belongings upstairs when we can no longer carry them. Other colleagues wondered about welcoming both editors and reporters. How can these two groups, which some consider natural adversaries, complain about each others’ tin ears or missed deadlines if we’re not segregated?

I disagree. The joy of this profession is its collaboration. We did the impossible day after day when young. We belong together when old.


Read More..

Peugeot Bets on a Different Kind of Hybrid





PARIS — What’s that car that just breezed past?




It’s the Hybrid Air — an experimental vehicle that the French automaker PSA Peugeot Citroën has been trumpeting lately as an exemplar of energy efficiency. While some skeptics doubt whether it is truly breakthrough technology, the Peugeot and Citroën concept cars containing it may prove to be some of the more intriguing models on display next week at the Geneva Motor Show.


Peugeot says a compact car like a Citroën C3 equipped with the technology will get about 100 kilometers per 2.9 liters, or 81 miles per gallon, in city driving. If so, that would be significantly more than existing hybrid electric vehicles like the Toyota Prius can achieve in stop-and-go traffic.


Peugeot, the second-biggest carmaker in Europe after Volkswagen, plans to begin rolling out Hybrid Air cars by 2015 or 2016.


Like a Toyota Prius, the Hybrid Air recovers energy each time the driver brakes or decelerates. But instead of using that braking energy to charge a battery, which then runs an electric motor — as in the Prius — the Hybrid Air has a reversible hydraulic pump that uses the braking energy to compress nitrogen gas in what looks like an oversized scuba tank. When the Hybrid Air driver next presses the accelerator, the compressed gas pushes hydraulic fluid, syringe fashion, through a gearbox to turn the wheels.


The energy stored in the nitrogen tank is small — equivalent to only about five teaspoons, or a couple dozen cubic centimeters, of gasoline — and enough to power the car only a few hundred meters before the standard gasoline motor takes over again. But repeated over the course of a day of city driving, Peugeot says, those extra teaspoons of energy add up to big improvement in gas mileage.


The idea of using so-called hybrid hydraulics to power a car has been around for a while, although Peugeot prefers to call it “hybrid air technology” because the energy is stored in the compressed gas, rather than the hydraulics. In the United States, Ford Motor and Chrysler have studied the approach with encouragement from the Environmental Protection Agency. UPS, the parcel service, has added several dozen hybrid hydraulic delivery vans to its alternative fuel fleet. Other companies are applying the technology to garbage trucks, which like UPS vans, are big, make frequent stops and stand to recover much of their wasted energy. The Indian auto company Tata has promised to produce a car powered solely by compressed air, although that uses a different technology than Peugeot’s approach.


Peugeot, with a 200-member Hybrid Air team led by Karim Mokaddem, an engineer, appears to be moving the fastest of any global automaker to bring the technology to the family car, while most of the industry has focused on hybrid electrics as the main alternative vehicles for reducing emissions and saving gasoline.


“The logic of an electric hybrid is completely different,” Andrés Yarce, another of the project leaders, said in Peugeot’s technical center in Carrières-sous-Poissy, near Paris. With an electric hybrid, “you let the vehicle run for a few kilometers, have the engine shut off, then run silently on an electric motor,” Mr. Yarce said. “It took time for people to grasp that the Hybrid Air works differently but gets the same results.”


When the car is ready for the market, Peugeot plans to price it below €20,000, or $26,000.


Mr. Mokaddem said the pricing was meant to make the Hybrid Air a viable option in emerging markets like China and India, where many hybrid electrics are too expensive for most consumers and too complex for local service and repair operations.


Peugeot says it can undercut hybrid electrics on price because its car does not require a special, expensive battery and electric motor that vehicles like the Prius use, although the Hybrid Air does employ a standard car battery. The hydraulic system also adds about 100 kilograms, or 220 pounds, to the weight of a conventional Citroën or Peugeot. And because of the heat generated by the energy transfer process, the designers have had to adapt the car’s cooling system.


The most obvious difference between the prototype Hybrid Air and an ordinary car is the presence of two air tanks (the second, smaller tank is a low-pressure receptacle) and a special gearbox that manages the energy handoffs between the hydraulics and the 1.2-liter standard gasoline engine. The designers say the setup left them room to keep a standard-size trunk and gas tank.


The accumulator, or pressurized nitrogen tank is 1.3 meters, or about 4 feet, long, with a volume of 20 liters, or 5.3 gallons, and a maximum pressure of 250 bar, or about 3,600 pounds per square inch.


Read More..

South African Police Drag Man, Who Later Dies







JOHANNESBURG (AP) — His hands are tied to the rear of a police van while his body lay behind it, on the ground. The van speeds off, dragging the slender man along the pavement as a crowd of onlookers shouts in dismay and at least one videotapes the scene. He is later found dead in a police cell.




It's a gut-wrenching video, made all the more disturbing by the fact that the men who carried out the abuse were uniformed South African police officers and the van was a marked police vehicle. The Daily Sun, a South African newspaper, posted video the footage Thursday and it was quickly picked up by other South African news outlets and carried on the Internet. It sparked immediate outrage.


Some of those in the crowd who watched the scene unfold in a township east of Johannesburg shouted at the police and warned that it was being videotaped. The police did not seem at all concerned as they tied Mido Macia, a 27-year-old taxi driver from neighboring Mozambique, to the back of a police vehicle, his hands behind his head, his buttocks on the ground. At least three policemen participated in the incident. Macia was found dead in a police cell late Tuesday in the Daveyton township east of Johannesburg.


The Independent Police Investigative Directorate, the police watchdog agency, said Thursday that a murder probe is underway and that Macia suffered head and other injuries, including internal bleeding.


The graphic footage renewed concerns about brutality, corruption and other misconduct by a national police force whose reputation has suffered in recent years amid reports that many officers lack training. Some have been charged with committing the crimes they are supposed to prevent, including rape and murder.


"We are going to film this," several onlookers shouted in Zulu as the police tormented Macia. One bystander can be heard on the videotape shouting in Zulu: "What has this guy done?"


At first, Macia, dressed in jeans and a red T-shirt, is dragged along the road by the vehicle at slow speed, the footage shows. He awkwardly tries to keep step even though he is almost horizontal above the ground. Then the van stops, two policemen pick up the legs of the taxi driver and drop them to the ground as the van picks up speed and drives off, beyond the view of the camera.


The police watchdog agency said the incident started just before 7 p.m. on Tuesday when the cab driver was allegedly obstructing traffic with his vehicle. Then, Macia allegedly assaulted a constable and took his weapon before he was overpowered, the Independent Police Investigative Directorate said in a statement.


Macia was found dead over two hours later by another policeman, according to the watchdog agency.


In a statement, the police force said National Police Commissioner Riah Phiyega "strongly condemned" what happened. The statement said people are "urged to remain vigilant and continue to report all acts of crime irrespective of who is involved."


Phiyega has sought to upgrade the reputation of the South African police. Last month, Phiyega told a group of police officials the standing of the force "has been severely but not irreparably tarnished over the past several years."


Read More..

The New Old Age Blog: For the Elderly, Lists of Tests to Avoid

The Choosing Wisely campaign, an initiative by the American Board of Internal Medicine Foundation in partnership with Consumer Reports, kicked off last spring. It is an attempt to alert both doctors and patients to problematic and commonly overused medical tests, procedures and treatments.

It took an elegantly simple approach: By working through professional organizations representing medical specialties, Choosing Wisely asked doctors to identify “Five Things Physicians and Patients Should Question.”

The idea was that doctors and their patients could agree on tests and treatments that are supported by evidence, that don’t duplicate what others do, that are “truly necessary” and “free from harm” — and avoid the rest.

Among the 18 new lists released last week are recommendations from geriatricians and palliative care specialists, which may be of particular interest to New Old Age readers. I’ve previously written about a number of these warnings, but it’s helpful to have them in single, strongly worded documents.

The winners — or perhaps, losers?

Both the American Geriatrics Society and the American Academy of Hospice and Palliative Medicine agreed on one major “don’t.” Topping both lists was an admonition against feeding tubes for people with advanced dementia.

“This is not news; the data’s been out for at least 15 years,” said Sei Lee, a geriatrician at the University of California, San Francisco, and a member of the working group that narrowed more than 100 recommendations down to five. Feeding tubes don’t prevent aspiration pneumonia or prolong dementia patients’ lives, the research shows, but they do exacerbate bedsores and cause such distress that people often try to pull them out and wind up in restraints. The doctors recommended hand-feeding dementia patients instead.

The geriatricians’ list goes on to warn against the routine prescribing of antipsychotic medications for dementia patients who become aggressive or disruptive. Though drugs like Haldol, Risperdal and Zyprexa remain widely used, “all of these have been shown to increase the risk of stroke and cardiovascular death,” Dr. Lee said. They should be last resorts, after behavioral interventions.

The other questionable tests and treatments:

No. 3: Prescribing medications to achieve “tight glycemic control” (defined as below 7.5 on the A1c test) in elderly diabetics, who need to control their blood sugar, but not as strictly as younger patients.

No. 4: Turning to sleeping pills as the first choice for older people who suffer from agitation, delirium or insomnia. Xanax, Ativan, Valium, Ambien, Lunesta — “they don’t magically disappear from your body when you wake up in the morning,” Dr. Lee said. They continue to slow reaction times, resulting in falls and auto accidents. Other sleep therapies are preferable.

No. 5: Prescribing antibiotics when tests indicate a urinary tract infection, but the patient has no discomfort or other symptoms. Many older people have bacteria in their bladders but don’t suffer ill effects; repeated use of antibiotics just causes drug resistance, leaving them vulnerable to more dangerous infections. “Treat the patient, not the lab test,” Dr. Lee said.

The palliative care doctors’ Five Things list cautions against delaying palliative care, which can relieve pain and control symptoms even as patients pursue treatments for their diseases.

It also urges discussion about deactivating implantable cardioverter-defibrillators, or ICDs, in patients with irreversible diseases. “Being shocked is like being kicked in the chest by a mule,” said Eric Widera, a palliative care specialist at the San Francisco V.A. Medical Center who served on the American Academy of Hospice and Palliative Medicine working group. “As someone gets close to the end of life, these ICDs can’t prolong life and they cause a lot of pain.”

Turning the devices off — an option many patients don’t realize they have — requires simple computer reprogramming or a magnet, not the surgery that installed them in the first place.

The palliative care doctors also pointed out that patients suffering pain as cancer spreads to their bones get as much relief, the evidence shows, from a single dose of radiation than from 10 daily doses that require travel to hospitals or treatment centers.

Finally, their list warned that topical gels widely used by hospice staffs to control nausea do not work because they aren’t absorbed through the skin. “We have lots of other ways to give anti-nausea drugs,” Dr. Widera said.

You can read all the Five Things lists (more are coming later this year), and the Consumer Reports publications that do a good job of translating them, on the Choosing Wisely Web site.


Paula Span is the author of “When the Time Comes: Families With Aging Parents Share Their Struggles and Solutions.”

Read More..

DealBook: In Europe, Risks and Opportunities

BERLIN – Is Europe a risk or an opportunity?

As its economies struggle, private equity managers offer differing views about the region.

Speaking at the SuperReturn conference in Berlin, Henry R. Kravis, co-founder of Kohlberg Kravis Roberts, said Europe was an attractive market, particularly the Continent’s southern countries, which have been hit by high unemployment and meager growth.

“I like Spain, they are doing a number of right things,” Mr. Kravis told a somewhat empty conference room early on Thursday morning after many private equity managers had attended late-night dinners the previous evening. “In Europe, there clearly are opportunities. I may be in the minority.”

Other private equity giants, including David M. Rubenstein of the Carlyle Group, are also scouting for opportunities from Italy to Ireland despite concerns that the Continent may fall back into recession.

Lionel Assant, European head of private equity at the Blackstone Group, liked Spain because of its close ties to fast-growing Latin American markets and efforts to revamp its local labor market.

Not every manager is so bullish, however.

J. Christopher Flowers, whose private equity firm bought an insurance broker from the struggling Belgian bank KBC for 240 million euros ($315 million) in 2011, said the future of the euro zone remained a major risk.

Europe’s recovery prospects were hurt again this week after Italian national elections on Monday failed to provide a definitive winner. The political impasse prompted significant losses in the Continent’s stock markets as investors fretted about the future of one of Europe’s largest economies.

For Mr. Flowers, there are still some potential investment opportunities, including the pending forced sale of bank branches in Britain from the nationalized Royal Bank of Scotland. The United States, however, still remains his preferred region in which to invest.

“If a major economy like Spain defaults, we would prefer to be in Germany,” Mr. Flowers said. “If I had to pick one region, I would pick the U.S.”


This post has been revised to reflect the following correction:

Correction: February 28, 2013

An earlier version of this article contained an incorrect conversion of 240 million euros. It is the equivalent of $315 million, not $310.

Read More..

Several Dead in Switzerland Shooting, Police Say







BERLIN (AP) — A shooting at a wood-processing company in central Switzerland on Wednesday left three people dead and seven wounded, some of them seriously, prosecutors said.




The shooting occurred shortly after 9 a.m. at the premises of Kronospan, a company in the small town of Menznau, west of Lucerne.


Three people were killed, among them the suspected assailant, police in Lucerne said in a statement. A further seven were wounded, several of them seriously. Officials gave no further details.


The local Neue Luzerner Zeitung newspaper cited a witness as saying that the shooter opened fire in the company canteen. It was not immediately clear who the shooter was, what the motive might have been or whether the assailant worked for the company.


According to the local town council, Kronospan has some 450 employees.


"At the moment we're all in a state of shock," Urs Fluder, a manager at Kronospan, told Radio Pilatus, a local station. "We will see that the families are properly informed," he added.


Gun ownership is widespread in Switzerland, thanks to liberal regulation — a 2012 referendum to tighten controls failed — and a long-standing tradition for men to keep their military rifles after completing compulsory military service.


An estimated 2.3 million firearms are owned by the country's 8 million people.


But gun crime is relatively rare, with just 24 gun killings in 2009, which works out to a rate of about 0.3 per 100,000 inhabitants. The U.S. rate that year was about 11 times higher.


Still, there have been several high-profile incidents over the years, including the killing of 14 people at a city council meeting in Zug, not far from Lucerne, in 2001.


Last month a 33-year-old man killed three women and wounded two men in a southern Swiss village.


Read More..

Greek man charged in NY Dali theft pleads guilty


NEW YORK (AP) — A Greek man has admitted to stealing a Salvador Dali painting from a New York City gallery, only to return it in the mail.


Phivos Istavrioglou pleaded guilty on Tuesday following his arrest in the theft of a work titled "Cartel de Don Juan Tenorio."


Prosecutors say the fashion industry publicist walked into the Manhattan gallery in June, put the painting valued at about $150,000 in a shopping bag and walked out. He anonymously mailed the piece back to the United States from Greece after seeing news coverage of the theft.


Under the plea deal, Istavrioglou avoids additional jail time if he remains incarcerated until his formal sentencing on March 12. He also must pay more than $9,000 in restitution.


His lawyer said it was a stupid thing to do.


Read More..

Global Health: After Measles Success, Rwanda to Get Rubella Vaccine


Rwanda has been so successful at fighting measles that next month it will be the first country to get donor support to move to the next stage — fighting rubella too.


On March 11, it will hold a nationwide three-day vaccination campaign with a combined measles-rubella vaccine, hoping to reach nearly five million children up to age 14. It will then integrate the dual vaccine into its national health service.


Rwanda can do so “because they’ve done such a good job on measles,” said Christine McNab, a spokeswoman for the Measles and Rubella Initiative. M.R.I. helped pay for previous vaccination campaigns in the country and the GAVI Alliance is helping financing the upcoming one.


Rubella, also called German measles, causes a rash that is very similar to the measles rash, making it hard for health workers to tell the difference.


Rubella is generally mild, even in children, but in pregnant women, it can kill the fetus or cause serious birth defects, including blindness, deafness, mental retardation and chronic heart damage.


Ms. McNab said that Rwanda had proved that it can suppress measles and identify rubella, and it would benefit from the newer, more expensive vaccine.


The dual vaccine costs twice as much — 52 cents a dose at Unicef prices, compared with 24 cents for measles alone. (The MMR vaccine that American children get, which also contains a vaccine against mumps, costs Unicef $1.)


More than 90 percent of Rwandan children now are vaccinated twice against measles, and cases have been near zero since 2007.


The tiny country, which was convulsed by Hutu-Tutsi genocide in 1994, is now leading the way in Africa in delivering medical care to its citizens, Ms. McNab said. Three years ago, it was the first African country to introduce shots against human papilloma virus, or HPV, which causes cervical cancer.


In wealthy countries, measles kills a small number of children — usually those whose parents decline vaccination. But in poor countries, measles is a major killer of malnourished infants. Around the world, the initiative estimates, about 158,000 children die of it each year, or about 430 a day.


Every year, an estimated 112,000 children, mostly in Africa, South Asia and the Pacific islands, are born with handicaps caused by their mothers’ rubella infection.


Thanks in part to the initiative — which until last year was known just as the Measles Initiative — measles deaths among children have declined 71 percent since 2000. The initiative is a partnership of many health agencies, vaccine companies, donors and others, but is led by the American Red Cross, the United Nations Foundation, the Centers for Disease Control and Prevention, Unicef and the World Health Organization.


This article has been revised to reflect the following correction:

Correction: February 27, 2013

An earlier version of this article misstated the source of the financing for the upcoming vaccination campaign in Rwanda. It is being financed by the GAVI Alliance, not the Measles and Rubella Initiative.




Read More..

DealBook: Regulators Block Ryanair’s Latest Attempt to Buy Aer Lingus

BRUSSELS — The European Commission on Wednesday blocked the third attempt by Ryanair to take over Aer Lingus, saying the tie-up of the two Irish airlines would damage competition and raise prices on air routes to Ireland.

The decision was widely expected after Ryanair — the largest budget carrier in Europe — said earlier that the commission would prohibit the deal, worth about 700 million euros or $900 million.

“The Commission’s decision protects more than 11 million Irish and European passengers who travel each year to and from Dublin, Cork, Knock and Shannon,” the European Union competition commissioner, Joaquín Almunia, said in a statement before a news conference.

Proposals made by Ryanair “were simply inadequate to solve the very serious competition problems which this acquisition would have created on no less than 46 routes,” Mr. Almunia said.

Shares of Ryanair were down 6 euro cents to 5.60 euros by early afternoon in Dublin; Aer Lingus stock was up 1 cent at 1.25 euros.

On Wednesday, Aer Lingus, which had rejected Ryanair’s offers, said that it welcomed the commission decision. Ryanair, which owns about 30 percent of Aer Lingus, reiterated that it would appeal the decision to the European Court of Justice.

Ryanair accused Mr. Almunia of protecting Aer Lingus, the Irish flag carrier, against a takeover by an upstart. The company also contends that the regulator applied a double standard because he approved the takeover by British Airways and Iberia of British Midland International last year under a simplified procedure.

“We regret that this prohibition is manifestly motivated by narrow political interests rather than competition concerns and we believe that we have strong grounds for appealing and overturning this politically inspired prohibition,” said Robin Kiely, a spokesman for Ryanair.

Prolonged litigation could have wider ramifications, making it more difficult for the Irish government to sell its 25 percent stake in Aer Lingus. Ireland agreed to sell that stake under the terms of an international bailout finalized in November 2010, although that agreement did not set a deadline for the sale.

The deal is the fourth Mr. Almunia has blocked since he took over the role of the region’s antitrust chief in February 2010. Earlier this year, the regulator thwarted U.P.S.‘s attempt to buy TNT Express.

The decision on Wednesday marks the latest chapter in years of acrimony between the commission and Ryanair’s pugnacious chief executive, Michael O’Leary, who has repeatedly criticized commission officials for decisions that curtailed his ambitions.

The enmity between Mr. O’Leary and the commission developed early last decade when the two sides began a running battle over whether Ryanair received illegal state subsidies that enabled the airline to open up routes to regional airports. Those airports were often some distance from major transport hubs, but still close enough to lure passengers away from more established carriers.

Last year, the commission announced new investigations into the effect of discounts Ryanair had received at the Lübeck-Blankensee airport in Germany and the Klagenfurt regional airport in Austria.

Mr. O’Leary has sharply criticized the commission for failing to do more to save money by booking its officials on low-cost airlines like his own. Ryanair also has said its arrangements with all E.U. airports comply with the bloc’s competition rules.

The E.U. competition authority blocked Ryanair’s first bid for Aer Lingus in 2007 on the grounds that the combined airline would have had a monopoly on too many routes. Back then, Mr. O’Leary accused the commission of bowing to political pressure from the Irish government, which opposed the deal. The airline abandoned a second attempt in 2009 because of opposition from the Irish government.

On Wednesday, Ryanair accused the commission of holding it to a higher standard than other airlines seeking mergers after it had offered ‘‘historic and unprecedented’’ concessions.

Among them: allowing two competitor airlines to serve Dublin, Cork and Shannon; giving those airlines more than half of the short-distance business that currently belongs to Aer Lingus; and agreeing to transfer airport slots in Britain to allow British Airways to serve Ireland from both Gatwick and Heathrow. Ryanair also had offered Flybe, a competitor, 100 million euros in funding to make it “a commercially profitable and viable entity” in Ireland.

On Wednesday, the commission spelled out the reasons behind its decision.

It said that both Ryanair and Aer Lingus had strengthened their positions in the Irish market since the commission refused the previous deal in 2007, and that the merger would have created an ‘‘outright monopoly’’ on 28 short-distance routes serving Ireland. The commission also said that there were such high barriers to entry to the Irish market that any new competitors would face too many challenges.

The commission’s “market investigation showed that there was no prospect that any new carrier would enter the Irish market after the merger, in particular by the creation of a base at the relevant Irish airports, and challenge the new entity on a sufficient scale,” it said in a statement. “Higher prices for passengers would have been the likely outcome,”

Read More..

DealBook: Banks Fear Court Ruling in Argentina Bond Debt

A fierce battle between the government of Argentina and hedge funds and other investors led by a group of hedge funds has already led to the seizure of a naval ship and dragged in the United States Treasury. Now a federal appeals court is hearing the dispute, and how it rules could have a major impact on world debt markets.

The investors — including the hedge fund tycoon Paul E. Singer — sued Argentina seeking payment for $1.3 billion relating to bonds that the country defaulted on in 2001. On Wednesday, the case comes before the United States Court of Appeals for the Second Circuit, which has already sided with the hedge funds on their main arguments.

But the issue that the appeals court is still undecided about is perhaps the most important. It involves devising a method to pressure Argentina to pay up on the disputed bonds. And that has left the investors who hold a majority of Argentina’s foreign debt vulnerable, as well as the banks that process the payments to those investors.

While the hedge funds have grabbed the headlines — winning a temporary court order to seize an Argentine naval ship docked in Ghana, for example — most of the other holders of Argentina’s nearly $100 billion in defaulted debt agreed over the last decade to accept new bonds, taking big losses in the process. The country has since faithfully paid on the exchange bonds.

At the same time, Argentina has vehemently repeated that it will not pay the hedge funds and other holders of its old debt and has passed laws forbidding the government from paying anything to the bondholders who didn’t participate in the exchanges.

But last year, Judge Thomas P. Griesa of the Federal District Court in Manhattan ruled that if Argentina wanted to pay the holders of the restructured debt, it would have to pay the hedge funds and other holders of the defaulted debt, too. The judge included third-party banks in his injunction, and prohibited them from processing payments to holders of the exchange bonds unless all debt holders were paid.

Large banks, investors and the United States Treasury Department have objected to the judge’s order. In short, they say, using the sanction could cause financial losses for innocent bystanders and lead to unnecessary disruption in the bond markets.

“They are trying to block the payments system,” said Vladimir Werning, executive director for Latin American research at JPMorgan Chase. “This is unprecedented in the New York jurisdiction.”

In an e-mail, Kevin Heine, a spokesman for Bank of New York Mellon, which handles bond payments, said the ruling, “will create unrest in the credit markets and result in cascades of litigation, which is precisely the opposite effect that an injunction should have.”

A ruling in favor of the hedge funds would also have ripple effects throughout the debt markets.

“Any time you have something that can change of balance of power, it can matter beyond Argentina,” said Robert Kahn, a fellow at the Council on Foreign Relations.

Despite the legal worries, investors have so far been keen to hold higher-yielding emerging markets debt, given that interest rates are so low. Apart from Argentine bonds, debt issued by developing countries has performed strongly.

Unlike Argentina, some countries have held their noses and cut deals with holdouts in the past to get on with important economic overhauls, most recently Greece on certain smaller foreign-law bonds.

And in the years since Argentina’s default, most sovereign bonds have special clauses in them that make it much harder for holdouts to succeed. These are called collective action clauses, which state that if a certain majority of bondholders agree to take losses in a bond restructuring, those losses would be forced on all bondholders, even would-be holdouts who don’t agree.

But large amounts of bonds, those issued more than 10 years ago, do not have collective action clauses. And those that do have the clauses may not act as intended if the holdouts win their Argentina case, said Mr. Werning of JPMorgan.

Right now, a bond with a collective action clause might get restructured if 75 percent of the holders agree to it. If Judge Griesa’s ruling is upheld, more bondholders might be reluctant to enter a restructuring and the required majority might not be achieved. Bondholders might not enter the restructuring because they fear holdout litigation depriving them of payments later on.

“This could adversely affect the level of participation in a swap,” Mr. Werning said.

Still, others contend that the market for sovereign debt may be improved if the judge’s ruling is upheld, with the sanction on payments banks mostly intact. Countries like Argentina, they say, have taken advantage of the fact that there is no bankruptcy regime in the sovereign debt market to allow creditors to recoup money in a default. Indeed, Judge Griesa has said the Argentina case is partly about creating safeguards for creditors in the absence of bankruptcy regime.

But Anna Gelpern, a professor at the Washington College of Law at the American University, said that if the federal court’s rulings are upheld, it might just end up underscoring the limitations of the American courts’ power.

“What if Argentina still doesn’t settle? How does the court look then?” she said. “It can only isolate Argentina and Argentina seems content to be isolated.”

While there is a chance that the appellate court’s decision could be appealed to the United States Supreme Court, it is more likely that its ruling will be the final word on the lower court order.

According to that order, if a bank chose to channel payments from Argentina to the owners of the restructured debt, the bank would not be in compliance with his order. A payments bank, Bank of New York Mellon in the case of Argentine exchange bonds, would then decline to process the exchange bond payments, and the bonds could fall into default, inflicting big losses on their holders.

Some market specialists have raised the prospect that Argentina could keep paying the exchange bondholders by avoiding payments banks that operate in the United States. It could, for instance, swap the exchange bonds for new instruments registered under Argentine law that make payments through an Argentine entity.

But the court may decide that, in such a situation, the exchange bondholders themselves would be breaking its injunction. One of the things the appeals court is looking into is how to determine which third parties should sit outside the reach of the district court’s ruling.

It is not just hedge funds who are hoping to gain from an affirmation of the lower court ruling. This group also includes many individual investors, who are now feeling more optimistic about getting their money back as the case comes before the appeals court.

“We are hopeful the ruling will stay as issued,” said Horacio Vázquez, who helps lead a group in Buenos Aires that represents bondholders.

A version of this article appeared in print on 02/26/2013, on page B1 of the NewYork edition with the headline: Banks Fear Court Ruling In Argentina Bond Debt.
Read More..