Mass protest as Michigan curbs union rights

CHICAGO: Thousands of protesters descended on Michigan's state capitol Tuesday as lawmakers prepared to pass union-curbing "right-to-work" legislation in a state seen as the heart of the labor movement.

The measure would weaken unions by allowing workers who get the same wages and benefits as union members to decline to pay any union dues.

Democratic lawmakers begged their Republican colleagues not to pass the controversial bill, which they warned would unleash deep social and political strife.

"There will be blood. There will be repercussions," state representative Douglass Geiss told the chamber.

Geiss reminded his colleagues of the violent clashes that accompanied the struggle to form unions in the 1930s and warned that people feel just as strongly about solidarity today.

"If ten people walk in and say I'm not going to pay dues anymore, there's going to be fights," he warned.

State representative John Switlaski lashed out at the fact Republicans were pushing the bill through in a lame duck session using a parliamentary maneuver that limits debate and means Democrats can't stop it unless they regain control in the 2014 election.

"The next two years are going to be terrible. They're going to be ugly," Switlaski said.

"I think we should pause and take a step back... let the people have a say. we'll vote for it. Put it on the ballot."

Republican state representative Lisa Lyons insisted the law was about giving workers their constitutionally guaranteed right to freedom of association.

"We are witnessing history in the making," she said. "This is the day that Michigan freed its workers."

Boos and chants of "veto" poured into the chamber from the gallery after the House voted 58-51 to pass the bill, sending it to Governor Rick Snyder for final approval.

Hundreds of union members and supporters crowded into the capitol dome, blowing whistles and chanting "the people are united" and "What's disgusting? Union busting!"

Thousands more shivered in the cold outside, television news footage showed.

"The right-wing forces in Michigan are trying to take power away from working families," United Auto Workers union chief Bob King told reporters.

"They want working families to have less income, less security. This is about partisanship, not bringing the state together."

Currently, the state operates a "closed shop" policy that requires workers who profit from collective bargaining to pay fees but does not make it mandatory for them to become union members.

The right-to-work law creates an incentive for people not to join the union in what is known as the "free rider" problem because it allows them to benefit from collective bargaining without paying for it.

Snyder insists the law is necessary "to maintain our competitive edge" and attract new jobs, especially after neighboring Indiana became the 23rd US state to enact right-to-work legislation earlier this year.

But while business may profit from weakening unions, the real motivation for lawmakers is political, said Roland Zullo, a labor relations expert at the University of Michigan.

"This whole right-to-work thing is retribution," Zullo told AFP. "It's really about the fact that unions in Michigan were very important actors in helping to elect Democrats this last election."

Unions are a key source of financial and grassroots get-out-the-vote support for President Barack Obama's Democrats, and he was quick to slam the controversial bill in an appearance at Michigan auto plant Monday.

"You know, these so-called right-to-work laws -- they don't have to do with economics: they have everything to do with politics," Obama told a cheering crowd of unionized workers.

"What they're really talking about is giving you the right to work for less money."

-AFP/ac

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Cairo faces rival protests over constitution crisis

CAIRO (Reuters) - Opponents and supporters of Egyptian President Mohamed Mursi's plans to vote on a new constitution will take to the streets in central Cairo later on Tuesday, risking more violent confrontation after last week's deadly clashes.

Leftists, liberals and other opposition groups have called for marches to the presidential palace in the afternoon to protest against the hastily arranged referendum planned for Saturday, which they say is polarizing the country.

Islamists, who dominated the body that drew up the constitution, have urged their followers to turn out "in millions" the same day in a show of support for the president and for a referendum they feel sure of winning and that critics say could put Egypt in a religious straitjacket.

Seven people were killed and hundreds wounded last week in clashes between the Islamist Muslim Brotherhood and opponents besieging Mursi's graffiti-daubed presidential palace.

The elite Republican Guard has yet to use force to keep protesters away from the palace, now ringed with tanks, barbed wire and concrete barricades, but a decree issued by Mursi late on Sunday gives the armed forces the power to arrest civilians during the referendum and until the announcement of the results.

Leftist politician Hamdeen Sabahy, one of the most prominent members of the National Salvation Front opposition coalition, said Mursi was driving a wedge between Egyptians and destroying prospects for consensus.

As well as pushing the early referendum, Mursi has angered opponents by taking sweeping temporary powers he said were necessary to secure the country's transition to stability after a popular uprising overthrew autocratic former president Hosni Mubarak 22 months ago.

"The road Mohamed Mursi is taking now does not create the possibility for national consensus," said Sabahy.

If the constitution was passed, he said: "Egypt will continue in this really charged state. It is certain that this constitution is driving us to more political polarization."

The National Salvation Front also includes Nobel Peace Prize laureate Mohamed ElBaradei and former Arab League chief Amr Moussa.

The opposition says the draft constitution fails to embrace the diversity of 83 million Egyptians, a tenth of whom are Christians, and invites Muslim clerics to influence lawmaking.

But debate over the details has largely given way to noisy street protests and megaphone politics, keeping Egypt off balance and ill equipped to deal with a looming economic crisis.

Lamia Kamel, a spokeswoman for Moussa, said the opposition factions were still discussing whether to boycott the referendum or call for a "no" vote.

"Both paths are unwelcome because they really don't want the referendum at all," she said, but predicted a clearer opposition line if the plebiscite went ahead as planned.

Mahmoud Ghozlan, the Muslim Brotherhood's spokesman, said the opposition could stage protests, but should keep the peace.

"They are free to boycott, participate or say no; they can do what they want. The important thing is that it remains in a peaceful context to preserve the country's safety and security."

The army stepped into the conflict on Saturday, telling all sides to resolve their disputes via dialogue and warning that it would not allow Egypt to enter a "dark tunnel".

The continuing disruption is also casting doubts on the government's ability to push through tough economic reforms that form part of a proposed $4.8 billion IMF loan agreement.

(Writing by Edmund Blair; Editing by Will Waterman)

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Is SC right in shutting our legal rights, asks 2G scam accused

NEW DELHI: A 2G scam accused on Monday questioned the Supreme Court's strict monitoring of the CBI investigation into alleged irregularities in spectrum allocation in 2008 under then telecom minister A Raja and challenged its orders asking other courts not to entertain appeals against trial court decisions.

Accused Asif Balwa's writ petition also questioned the legality of a two-judge bench's November 9 order, by which the SC had issued notices to all accused asking why their petitions in the Delhi High Court against the decision of the trial court to frame charges against them be not transferred to the apex court.

Senior advocate Ram Jethmalani mentioned the petition before a three-judge bench headed by Chief Justice Altamas Kabir and sought an urgent hearing on the ground that precious rights of the accused facing trial were being breached by the two-judge bench's orders. The CJI-headed bench said it would examine the contents of the petition and consider giving a hearing to the petitioner.

Balwa, who was a director of Swan Telecom (now known as Etisalat DB Telecom Pvt Ltd), also questioned the two-judge bench's method of monitoring the investigation, during which the judges had looked into the draft chargesheet of the CBI against the accused. "The role of constitutional courts in monitoring investigation and the jurisdiction to adjudicate issues arising there from have to be dealt with, in order to ensure that the prosecutor, investigator and the judge are not seen to be same person," he said.

Balwa said it was well-settled in law that on filing of chargesheet by the investigating agency, the monitoring by a constitutional court must come to an end to allow the trial to proceed under the statutory provisions.

"Merely because the Supreme Court has monitored the investigation does not mean that all the remedies available to the accused as well as the prosecution in accordance with law has been subverted," he said questioning the apex court's orders asking the HC not to entertain pleas of the accused facing trial in the case relating to alleged irregular allocation of spectrum.

Balwa also said the special bench, which monitored the 2G scam, had passed orders against the accused on a petition in which they were not even included as parties. "Thus, there is a complete failure of principle of natural justice as the orders and directions have been passed without giving an opportunity of hearing to the affected parties including the petitioner," he added.

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New Evidence Suggests Biblical Flood Happened

The story of Noah's Ark and the Great Flood is one of the most famous from the Bible, and now an acclaimed underwater archaeologist thinks he has found proof that the biblical flood was actually based on real events.

In an interview with Christiane Amanpour for ABC News, Robert Ballard, one of the world's best-known underwater archaeologists, talked about his findings. His team is probing the depths of the Black Sea off the coast of Turkey in search of traces of an ancient civilization hidden underwater since the time of Noah.

Tune in to Christiane Amanpour's two-part ABC News special, "Back to the Beginning," which explores the history of the Bible from Genesis to Jesus. Part one airs on Friday, Dec. 21 and part two on Friday, Dec. 28, both starting at 9 p.m. ET on ABC. See photos from her journey HERE

Ballard's track record for finding the impossible is well known. In 1985, using a robotic submersible equipped with remote-controlled cameras, Ballard and his crew hunted down the world's most famous shipwreck, the Titanic.

Now Ballard is using even more advanced robotic technology to travel farther back in time. He is on a marine archeological mission that might support the story of Noah. He said some 12,000 years ago, much of the world was covered in ice.

"Where I live in Connecticut was ice a mile above my house, all the way back to the North Pole, about 15 million kilometers, that's a big ice cube," he said. "But then it started to melt. We're talking about the floods of our living history."

The water from the melting glaciers began to rush toward the world's oceans, Ballard said, causing floods all around the world.

"The questions is, was there a mother of all floods," Ballard said.

According to a controversial theory proposed by two Columbia University scientists, there really was one in the Black Sea region. They believe that the now-salty Black Sea was once an isolated freshwater lake surrounded by farmland, until it was flooded by an enormous wall of water from the rising Mediterranean Sea. The force of the water was two hundred times that of Niagara Falls, sweeping away everything in its path.

Fascinated by the idea, Ballard and his team decided to investigate.

"We went in there to look for the flood," he said. "Not just a slow moving, advancing rise of sea level, but a really big flood that then stayed... The land that went under stayed under."

Four hundred feet below the surface, they unearthed an ancient shoreline, proof to Ballard that a catastrophic event did happen in the Black Sea. By carbon dating shells found along the shoreline, Ballard said he believes they have established a timeline for that catastrophic event, which he estimates happened around 5,000 BC. Some experts believe this was around the time when Noah's flood could have occurred.

"It probably was a bad day," Ballard said. "At some magic moment, it broke through and flooded this place violently, and a lot of real estate, 150,000 square kilometers of land, went under."

The theory goes on to suggest that the story of this traumatic event, seared into the collective memory of the survivors, was passed down from generation to generation and eventually inspired the biblical account of Noah.

Noah is described in the Bible as a family man, a father of three, who is about to celebrate his 600th birthday.

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Football: Police hunt for Ferdinand coin throw culprit

LONDON: Police said on Monday that they were working to track down the person responsible for throwing a coin at Manchester United's Rio Ferdinand during Sunday's Manchester derby.

Ferdinand was left with blood streaming down his face from a cut above his eye after being struck by a coin as he celebrated Robin van Persie's injury-time winner in United's 3-2 victory at Manchester City.

Greater Manchester Police said that they had made 13 arrests and charged nine people over offences that occurred before, during and after the match.

"To have just 13 arrests for a crowd of this size and a match of this proportion is a testament to the policing operation we put in place," said Chief Inspector Steve Howard.

"Despite fierce rivalry and high tension, there was no major disorder. However, we will continue to investigate the coin-throwing incident and are determined to work with the club to bring the perpetrator to justice."

The Football Association (FA) are also investigating the incident.

Among the people charged were two men accused of entering the field of play during the game.

City goalkeeper Joe Hart had to restrain one fan from getting at Ferdinand after the coin-throwing incident, prompting the United defender to thank his one-time England colleague on Twitter.

The supporter, 21-year-old landscape gardener Matthew Stott, expressed regret for his behaviour on Monday.

"I would like to apologise to all those affected by my actions yesterday (Sunday), particularly Mr Ferdinand and the other players," he said in a statement released by his lawyers.

"I am extremely ashamed of my actions. I have let myself down, my family down, my fellow fans down and Manchester City Football Club."

Despite his apology, City cancelled Stott's season ticket for the rest of the season and said he would be given a lifetime ban from the club if found guilty of pitch encroachment.

"His season card has been immediately removed for the rest of the season and he has been charged to appear at court. If he is found guilty, he faces a lifetime ban," said a City spokesman.

A 30-year-old man has also been charged with what police said was a "racially aggravated public order" offence.

All the people charged are due to appear before magistrates in Manchester on January 4 next year.

FA chairman David Bernstein said the crowd trouble that marred the game was "deplorable" and called for strict punishments to be meted out to those responsible.

"It is deplorable to see those incidents and to see Rio Ferdinand with blood on his face is absolutely terrible," he told Sky Sports News.

"I think it's disturbing that we're seeing a recurrence of these types of incidents. We've had racial abuse issues, the odd pitch incursion, things being thrown at players -- it's very unacceptable and has to be dealt with severely."

He added: "I believe that if necessary these people need to go to the court and be banned for life, if they're found out."

Meanwhile, Professional Footballers' Association (PFA) chief executive Gordon Taylor said there was a case to be made for erecting nets to protect players from missiles thrown by supporters.

"I think you've got to give consideration to possibly, as has been suggested, some netting in vulnerable areas, be it behind the goals and round the corner flags," he told BBC Radio 5 Live.

United's victory took them six points clear of defending champions City at the top of the Premier League table.

-AFP/ac

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Egypt's opposition rejects constitutional referendum

CAIRO (Reuters) - Egypt's main opposition coalition rejected on Sunday Islamist President Mohamed Mursi's plan for a constitutional referendum this week, saying it risked dragging the country into "violent confrontation".

Mursi's decision on Saturday to retract a decree awarding himself wide powers failed to placate opponents who accused him of plunging Egypt deeper into crisis by refusing to postpone the vote on a constitution shaped by Islamists.

"We are against this process from start to finish," Hussein Abdel Ghani, spokesman of the National Salvation Front, told a news conference, calling for more street protests on Tuesday.

The Front's main leaders - Nobel peace laureate Mohamed ElBaradei, former Foreign Minister Amr Moussa and leftist Hamdeen Sabahy - did not attend the event.

Hundreds of protesters milled around Mursi's palace, despite tanks, barbed wire and other barriers installed last week after clashes between Islamists and their rivals killed seven people.

"Holding a referendum now in the absence of security reflects haste and an absence of a sense of responsibility on the part of the regime, which risks pushing the country towards violent confrontation," a statement from the Front said.

The Muslim Brotherhood, which propelled Mursi from obscurity to power, urged the opposition to accept the referendum's verdict.

Islamists say the vote will seal a democratic transition that began when a popular uprising toppled Hosni Mubarak 22 months ago after three decades of military-backed one-man rule.

Their liberal, leftist and Christian adversaries say the document being fast-tracked through could threaten freedoms and fails to embrace the diversity of Egypt's 83 million people.

"ACT OF WAR"

Mursi had given some ground on Saturday when he annulled the fiercely contested decree issued on November 22 that gave him extra powers and shielded his decisions from judicial review.

But some measures taken under the decree remain in force and the president has insisted the referendum go ahead on December 15.

Liberal opposition leader Ahmed Said earlier described the race to a referendum as an "act of war" against Egyptians.

Egypt is torn between Islamists, who were suppressed for decades, and their rivals, who fear religious conservatives want to squeeze out other voices and restrict social freedoms. Many Egyptians just crave stability and economic recovery.

Brotherhood spokesman Mahmoud Ghozlan said the scrapping of Mursi's decree had removed any reason for controversy.

"We ask others to announce their acceptance of the referendum result," he said on the group's Facebook page, asking whether the opposition would accept "the basics of democracy".

The cancellation of Mursi's decree, announced after a "national dialogue" on Saturday boycotted by almost all the president's critics, has not bridged a deep political divide.

Prime Minister Hisham Kandil, a technocrat with Islamist leanings, said the referendum was the best test of opinion.

"The people are the makers of the future as long as they have the freedom to resort to the ballot box in a democratic, free and fair vote," he said in a cabinet statement.

But opposition factions, uncertain of their ability to vote down the constitution against the Islamists' organizational muscle, want the document redrafted before any vote.

"A constitution without consensus can't go to a referendum," said Hermes Fawzi, 28, a protester outside the palace. "It's not logical that just one part of society makes the constitution."

DIALOGUE

Egypt tipped into turmoil after Mursi grabbed powers to stop any court action aimed at hindering the transition. An assembly led by the Brotherhood and other Islamists then swiftly approved the constitution it had spent six months drafting.

Opponents, including minority Christians, had already quit the assembly in dismay, saying their voices were being ignored.

After the dialogue hosted by Mursi, a spokesman announced that the president had issued a new decree whose first article "cancels the constitutional declaration" of November 22. He said the referendum could not be delayed for legal reasons.

The decree ignited more than two weeks of sometimes violent protests and counter-rallies in Egypt. Mursi's foes have chanted for his downfall. Islamists fear a plot to oust the most populous Arab nation's first freely-elected leader.

Islamists reckon they can win the referendum and, once the new constitution is in place, a parliamentary election about two months later. The Islamist-led lower house elected this year was dissolved after a few months by a court order.

Investors appeared relieved after Mursi rescinded his decree, sending Egyptian stocks 4.4 percent higher on Sunday. Markets are awaiting approval of a $4.8 billion IMF loan later this month designed to support the budget and economic reforms.

The military, which led Egypt's transition for 16 turbulent months after Mubarak fell, told feuding factions on Saturday that only dialogue could avert "catastrophe". But a military source said these remarks did not herald an army takeover.

(Additional reporting by Edmund Blair and Yasmine Saleh; editing by David Stamp)

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Smokers celebrate as Wash. legalizes marijuana

SEATTLE (AP) — The crowds of happy people lighting joints under Seattle's Space Needle early Thursday morning with nary a police officer in sight bespoke the new reality: Marijuana is legal under Washington state law.

Hundreds gathered at Seattle Center for a New Year's Eve-style countdown to 12 a.m., when the legalization measure passed by voters last month took effect. When the clock struck, they cheered and sparked up in unison.

A few dozen people gathered on a sidewalk outside the north Seattle headquarters of the annual Hempfest celebration and did the same, offering joints to reporters and blowing smoke into television news cameras.

"I feel like a kid in a candy store!" shouted Hempfest volunteer Darby Hageman. "It's all becoming real now!"

Washington and Colorado became the first states to vote to decriminalize and regulate the possession of an ounce or less of marijuana by adults over 21. Both measures call for setting up state licensing schemes for pot growers, processors and retail stores. Colorado's law is set to take effect by Jan. 5.

Technically, Washington's new marijuana law still forbids smoking pot in public, which remains punishable by a fine, like drinking in public. But pot fans wanted a party, and Seattle police weren't about to write them any tickets.

In another sweeping change for Washington, Gov. Chris Gregoire on Wednesday signed into law a measure that legalizes same-sex marriage. The state joins several others that allow gay and lesbian couples to wed.

The mood was festive in Seattle as dozens of gay and lesbian couples got in line to pick up marriage licenses at the King County auditor's office early Thursday.

King County and Thurston County announced they would open their auditors' offices shortly after midnight Wednesday to accommodate those who wanted to be among the first to get their licenses.

Kelly Middleton and her partner Amanda Dollente got in line at 4 p.m. Wednesday.

Hours later, as the line grew, volunteers distributed roses and a group of men and women serenaded the waiting line to the tune of "Chapel of Love."

Because the state has a three-day waiting period, the earliest that weddings can take place is Sunday.

In dealing with marijuana, the Seattle Police Department told its 1,300 officers on Wednesday, just before legalization took hold, that until further notice they shall not issue citations for public marijuana use.

Officers will be advising people not to smoke in public, police spokesman Jonah Spangenthal-Lee wrote on the SPD Blotter. "The police department believes that, under state law, you may responsibly get baked, order some pizzas and enjoy a 'Lord of the Rings' marathon in the privacy of your own home, if you want to."

He offered a catchy new directive referring to the film "The Big Lebowski," popular with many marijuana fans: "The Dude abides, and says 'take it inside!'"

"This is a big day because all our lives we've been living under the iron curtain of prohibition," said Hempfest director Vivian McPeak. "The whole world sees that prohibition just took a body blow."

Washington's new law decriminalizes possession of up to an ounce for those over 21, but for now selling marijuana remains illegal. I-502 gives the state a year to come up with a system of state-licensed growers, processors and retail stores, with the marijuana taxed 25 percent at each stage. Analysts have estimated that a legal pot market could bring Washington hundreds of millions of dollars a year in new tax revenue for schools, health care and basic government functions.

But marijuana remains illegal under federal law. That means federal agents can still arrest people for it, and it's banned from federal properties, including military bases and national parks.

The Justice Department has not said whether it will sue to try to block the regulatory schemes in Washington and Colorado from taking effect.

"The department's responsibility to enforce the Controlled Substances Act remains unchanged," said a statement issued Wednesday by the Seattle U.S. attorney's office. "Neither states nor the executive branch can nullify a statute passed by Congress."

The legal question is whether the establishment of a regulated marijuana market would "frustrate the purpose" of the federal pot prohibition, and many constitutional law scholars say it very likely would.

That leaves the political question of whether the administration wants to try to block the regulatory system, even though it would remain legal to possess up to an ounce of marijuana.

Alison Holcomb is the drug policy director of the American Civil Liberties Union of Washington and served as the campaign manager for New Approach Washington, which led the legalization drive. She said the voters clearly showed they're done with marijuana prohibition.

"New Approach Washington sponsors and the ACLU look forward to working with state and federal officials and to ensure the law is fully and fairly implemented," she said.

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Johnson can be reached at https://twitter.com/GeneAPseattle

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Banda Superstar Jenni Rivera's Plane Missing

Mexican officials have confirmed the disappearance of a private jet carrying regional Mexican music superstar Jenni Rivera that took off from the northern Mexican city of Monterrey at 3:15 a.m. local time on Sunday and fell off the radar 10 minutes (or 62 miles) after take-off.

The Learjet 25 jet is believed to have been carrying seven people – five passengers and two pilots. It was headed for Toluca International Aiport, located outside of Mexico City, where it was meant to arrive at 4:40 a.m. An official search for the jet was initiated at sunrise.

Rivera's publicist Arturo Rivera is believed to have been on that flight. His most recent tweets are of photos from Rivera's concert in Monterrey on Saturday night.

The Mexican American singer's most recent tweet is a re-tweet of what appears to be a fan's message.

Rivera was due in Toluca this evening for the taping of a Mexican TV show, La Voz.

Known as La Diva de la Banda and beloved by fans on both sides of the border, Rivera, 43, has had a groundbreaking career in regional Mexican music, selling some 15 million records. Among her many feats in a male-dominated genre, she made history in September 2011 when she sold out the Staples Center in Los Angeles, the first female regional Mexican artist to do so. Her reality show on mun2, I Love Jenni, is one of the network's highest rated shows. Rivera made her film debut at the 2012 Sundance Film Festival in the indie family drama Filly Brown, due in theaters in January 2013.

See Also: 'Filly Brown Gives Jenni Rivera a Chance to Grow and Gina Rodriguez a Chance to Shine

The Long Beach, Calif.-born singer's personal life has often called for as much attention as her career. A mother of five, Rivera had filed for divorce from baseball player Esteban Loaiza in October after two years of marriage, citing "irreconcilable differences." Soon after, rumors of an affair between Loaiza and Rivera's own daughter Chiquis surfaced, which Chiquis addressed on Twitter in October by saying, "I would NEVER do that, Ever! That's a horrible accusation."

The search for Rivera's jet continues. This is a developing story.

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Nobel-winners vow Europe will emerge stronger from crisis

OSLO: The three European Union leaders in Norway to collect the Nobel peace prize moved Sunday to defuse criticism of the 2012 award, vowing the crisis-hit bloc would emerge strong and remain on a course of peace.

"Europe is going through a difficult period," EU president Herman Van Rompuy told a packed news conference on the eve of the awards ceremony.

"We are working hard, jointly as a union and in all individual countries, to overcome these problems," he added.

"I'm sure we will succeed. We will come out of this time of uncertainty and recession stronger than we were before."

Van Rompuy was speaking in euro-sceptic Norway, a country stubbornly opposed to joining the bloc.

As protests and job cuts traumatise Europe after three years of dire economic crisis, the Nobel Committee has come under attack for its decision to commend the EU for turning a continent at war into a continent at peace.

But the Nobel Committee chairman, the ardently pro-European Thorbjoern Jagland, justified the choice by the absence of conflict on a scale seen in the two world wars of the 20th century.

"The disputes and dramas have never led to war. On the contrary they have led to compromises,"

But highlighting the strain building as the EU weathers its worst crisis in 60 years, half a dozen leaders, including Britain's premier David Cameron, will snub Monday's ceremony.

"We want Europe to become again a symbol of hope," Van Rompuy added.

He flew into snowbound Oslo with European Commission chief Jose Manuel Barroso and European parliament head Martin Schulz. Together, they will pick up the prize on behalf of the EU.

But the crisis is undermining solidarity and generosity inside the EU.

Only last month, efforts to agree a new multi-year budget collapsed month in an ugly showdown between the rich nations of northern Europe and the struggling economies of the south.

And as the jobless figures rise, so too does support for nationalist and xenophobic movements.

In Greece, where unemployment is running at one-in-four and in Spain, where a half of under-25s are jobless, there is increasing talk of a "lost generation".

"The unprecedented financial crisis shows we were not fully equipped to cope with a crisis of this magnitude," Barroso conceded.

But the answer, he said, was more union. "All the steps were in favour of more integration, not less."

And he still hoped for agreement at a summit next week, only four days after the Nobel award. That meeting will look at setting up a banking union between the 17 eurozone nations, a first step towards tighter economic and monetary union.

Attending the ceremony in Oslo will be the leaders of the "big two" powers, France and Germany, Francois Hollande and Angela Merkel.

But relations between these two are rocky, with disagreements between the two leaders holding up the deal on a banking union.

Hailing the bloc's contribution in strengthening democracy for half a billion people -- some only recently emerging from authoritarian regimes -- Barroso said that "over the next 60 years Europe must lead the global quest for peace."

And next year, the bloc prepares to enlarge yet further by embracing Croatia as its 28th member next year.

Shulz, a German Socialist at the head of the European parliament, said the award must be "a warning, an alert" to stick to the ideals of the founders of the bloc in the aftermath of World War II.

-AFP/ac

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Egyptian military says only dialogue can avert disaster

CAIRO (Reuters) - Egypt's military, stepping into a crisis pitting Islamist President Mohamed Mursi against opponents who accuse him of grabbing excessive power, said on Saturday only dialogue could avert "catastrophe".

State broadcasters interrupted their programs to read out an army statement telling feuding factions that a solution to the upheaval in the most populous Arab nation should not contradict "legitimacy and the rules of democracy".

That sounded like a swipe at protesters who have besieged the palace of the freely elected president and called for his removal, going beyond mainstream opposition demands for him to retract a decree that expanded his powers.

The statement also called for a "serious" national dialogue - perhaps one more credible than talks convened by Mursi on Saturday in the absence of opposition leaders. They insist he must first scrap his November 22 decree, defer next week's popular vote on a new constitution and allow the text to be revised.

Deep rifts have emerged over the destiny of a country of 83 million where the end of Hosni Mubarak's 30 years of military-backed one-man rule led to a messy army-led transition, during which the Muslim Brotherhood and its allies won two elections. Many Egyptians crave stability and economic recovery.

The spokesman for the main Islamist coalition demanded that the referendum go ahead on time on the constitution drafted by an Islamist-led assembly from which liberals had walked out.

The army, which ran Egypt for months after Mubarak fell in February 2011, again cast itself primarily as the neutral guarantor of the nation. A military source said there was no plan to retake control of the country or its turbulent streets.

"DARK TUNNEL"

"The armed forces affirm that dialogue is the best and only way to reach consensus," the statement said. "The opposite of that will bring us to a dark tunnel that will result in catastrophe and that is something we will not allow."

Mursi's office said the president opened his "national dialogue" with about 40 political and other public figures discussing "means to reach a solution to differences over the referendum...and the constitutional decree".

Prime Minister Hisham Kandil told an Egyptian television channel that the talks had led to creating a committee to review Mursi's November 22 decree and to work out legal ways to postpone the referendum. He said a new decree could be issued.

"All options are on the table to reach consensus," he said, adding that it was vital to take action to shore up Egypt's economy that has been battered by the turmoil.

The main opposition coalition, the National Salvation Front, which boycotted Mursi's dialogue repeated its call on Saturday for scrapping the decree and the referendum on the constitution.

Instability in Egypt worries the West, especially the United States, which has given Cairo billions of dollars in military and other aid since it made peace with Israel in 1979.

The army might be pushing the opposition to join dialogue and Mursi to do more to draw them in, said Hassan Abu Taleb of the Al Ahram Center for Political and Strategic Studies.

He discounted the chance of direct military intervention, adding: "They realize that interfering again in a situation of civil combat will squeeze them between two rocks."

However, the military did seem poised to take a more active role in security arrangements for the December 15 referendum.

A cabinet source said the cabinet had discussed reviving the army's ability to make arrests if it were called upon to back up police, who are normally in charge of election security.

According to the state-run daily al-Ahram, an expanded military security role might extend to the next parliamentary election and, at the president's discretion, even beyond that.

The army issued its statement while protesters were still camped out by the gates of the presidential palace.

The tens of thousands of Mursi foes who surged past tanks and barbed wire to reach the palace gates on Friday night had dispersed. But a hard core stayed overnight in a score of tents.

"LEAVE"

Some had spray-painted "Down with Mursi" on tanks of the elite Republican Guard posted there after clashes between rival groups killed at least seven people and wounded 350 this week.

Others draped the tanks with posters of Mursi and the word "Leave" scored across his face in red letters.

"We are no longer calling for scrapping the decree and delaying the referendum," Samir Fayez, a Christian protester at the palace, said. "We have one demand in five letters: leave."

Nearby, a Mursi supporter named Mohamed Hassan was quietly observing the scene. He suggested that the Muslim Brotherhood and its ultra-orthodox Salafi Islamist allies could easily overwhelm their foes if they chose to mobilize their base.

"The Brotherhood and Salafis by themselves are few but they have millions of supporters who are at home and haven't taken it to the streets yet," murmured the 40-year-old engineer.

The Muslim Brotherhood's supreme guide, Mohamed Badie, denounced opposition protests that have swirled around the walls of Mursi's palace, saying they "ruin legitimacy".

Badie said eight people, all of them Brotherhood members, had been killed this week and urged the interior minister to explain why police had failed to prevent assailants from torching the organization's headquarters and 28 other offices.

"Get angry with the Brotherhood and hate us as much as you like, but be reasonable and preserve Egypt's unity," he told a news conference. "We hope everyone gets back to dialogue."

The well-organized Brotherhood, which thrust Mursi from obscurity to power, remains his surest source of support.

(Additional reporting by Edmund Blair, Omar Fahmy and Yasmine Saleh; Editing by Stephen Powell)

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