Greece future decision time

Greek protesters, enraged over the prospect of additional austerity measures, have thrown Athens into chaos.

NEW YORK (CNNMoney) -- The next week could decide the outcome of the debt crisis in Greece -- and the financial future of Europe along with it.

On Wednesday, the Greek Parliament is scheduled to vote on a raft of new painful austerity provisions, on top of the belt-tightening measures implemented last year.

The stakes are high, because Greece must approve the additional belt-tightening in order to win the last $17 billion of a $156 billion debt crisis relief package that was granted last year by its European neighbors.

The European Commission is hoping that the Parliament will approve the plan. "These measures, once fully implemented, will enable Greece to meet the agreed targets and remain on track," said the Commission on Friday.

Greek Prime Minister George Papandreou survived a vote of confidence last week, but his hold on power is tenuous as he tries to convince Parliament to pass the measures.

The new austerity measures include reductions in the pay of public workers and an increase in the attrition of public jobs, according to Marko Mrsnik, the lead analyst in the Standard & Poor's downgrade of Greek debt on June 13. The new austerity measures are worth an estimated $112 billion to the Greek economy, according to Deutsche Bank analyst Jim Reid.

On July 3, finance ministers of the European Union will vote on whether to approve the fifth and final tranche of funding from the bailout.

These hurdles must be cleared if Greece is to be eligible for yet another bailout from its European neighbors, which is a strong possibility, given the country's debt crisis.

Greece desperately needs the financial support, or it could run the risk of defaulting on its debts. Mrsnik, as part of his downgrade, said Greece was "increasingly likely" to default on some of its debt.

If this happens, it would disrupt the European banking system, which could, in turn, disrupt banks and markets in the United States.

Greece has been spending beyond its means, which has also been a problem in the United States. But in Greece, the problem is more pronounced, partly because the country and its economy are smaller and less diverse.

The Greek economy has been decidedly weak -- weaker than the United States -- with unemployment soaring up to 16.2%, compared to 11.6% in March 2010, according to Mrsnik.

But over the last year, the economic malaise and high unemployment has been exasperated by the austerity measures implemented in 2010, said Mrsnik. Those measures include pension cuts; a sales tax boost; excise taxes on fuel, cigarettes, alcohol and luxury goods; tougher eligibility for disability benefits; and a hike in the retirement age to 65 from as low as 61.

The specter of additional austerity measures has fanned the flames of recent violent protests in Athens. Many of the protesters are young Greeks who face dim prospects in finding jobs.

These protesters tend to blame the rich for the country's woes, since rampant tax evasion has been a major contributor to the Greek tragedy. Tax dodgers have undermined public financing in a country that is dependent upon socialist supports such as the publicly funded pension system.

Reining in tax dodgers is at the top of the list of the new reforms. 

First Published: June 27, 2011: 5:26 AM ET

CNN

Future of Air Travel: Airbus Predicts 'Transparent' Airplanes, 9 Billion Customers, By 2050 (Time.com)

By MICHAEL DONHAUSER / DIE WELT / WORLDCRUNCH Michael Donhauser / Die Welt / Worldcrunch – Sun Jun 26, 10:05 am ET

This post is in partnership with Worldcrunch, a new global-news site that translates stories of note in foreign languages into English. The article below was originally published in Die Welt.

Stale dry air, narrow seats, jammed overhead compartments: today's air passenger has to be a real flying nut to think plane travel is any fun. But engineers at European manufacturer Airbus say they're working on ways to improve things. Implementing the changes will probably take up to four decades, but they assure us the result will be more than worth the wait.

Flying in 2050 is going to be a real pleasure, the manufacturer says, with a 360-degree panoramic view whenever the "intelligent cabin membrane" is set on transparent, and a virtual golf course on board. Realistic projects, or overactive imaginations? "Engineers dream too," says Charles Champion, Airbus head of development. The Frenchman also points out that some of those dreams are already being implemented and may be launched in as little as 10 years from now.

One of the new ideas engineers are currently playing with involves harvesting passenger body heat to meet some of the plane's energy needs. Another idea refers to seats being upholstered with self-cleaning fabrics that adapt to each individual body form. (See photos of the "plane of the future.")

The first, business and economy class system would be abandoned: "It's not what people want," Champion says. Instead, there would be individual seating arrangements.

Innovations would by no means stop there. In the "vitalizing zone," for example, the air would be vitamin-enriched, while in the "interaction zone," passengers could enjoy virtual games of golf high up over the clouds, or go shopping and try on the latest fashions in virtual changing cabins. Through the cabin's transparent membrane, passengers would be able to gaze at the mountain peaks below them, and would be given information about the name of each summit and its exact height. State of the art communication with the ground would mean that business people could take part in video conferences at 33,000 feet, and that Mom or Dad could read bed time stories to their kids back home.

This cabin of the future - whose shape was modeled after birds - is part of Airbus's total concept for 2050. CEO Thomas Enders says the company expects the demand for aircraft to go up worldwide despite on-going problems faced by many airlines, particularly in Europe. (See 20 reasons to hate airlines.)

"Air travel continues to hold more long-term growth potential than virtually any other sector," Enders told the German newspaper "Welt am Sonntag." According to Airbus figures, air travel currently makes up 8%, or 580 billion dollars worth of the European gross domestic product. The sector employs 33 million people worldwide.

Airbus engineer Champion says that the three biggest current challenges are "that people want flying to be cheap, efficient and environmentally friendly." The sector has to find satisfactory answers to those demands, which is why flying will probably look completely different a few decades down the road. "By 2050, the sector will be hauling 9 billion passengers around the world," Champion says.

All that additional traffic will be possible thanks to new safety technologies that will enable companies to increase the number of flights fivefold. And instead of flying solo, planes could fly in formation and dock during flights to save on fuel. Airbus developers are even toying with the idea of huge airborne aircraft carriers that passenger planes could land on and be transported by. (See how airlines are cashing in on extras.)

Airbus' visions for airports of the future no longer include gates. Instead, planes would roll right up - subway style - to a station, with passengers boarding quickly through several doors with touch screens for the check in. Luggage would be put on a conveyor and stored in the cabin.

If Champion sees a sticking point, it concerns the airports themselves: "We can come up with all kinds of great stuff, but when a plane has to circle for 40 minutes over Heathrow before landing, a lot of it gets lost."

Also from Worldcrunch:

Human Trafficking in the Middle East
- Die Welt

Food Safety Scares in China Prompt Government to Choke Press Freedom
- Economic Observer

Surviving a Night in Zurich's Worst Hotel
- Tages Anzeiger

See 25 essential apps for travelers.

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Future of Air Travel: Airbus Predicts 'Transparent' Airplanes, 9 Billion Customers, By 2050 (Time.com)

By MICHAEL DONHAUSER / DIE WELT / WORLDCRUNCH Michael Donhauser / Die Welt / Worldcrunch – Sat Jun 25, 10:05 am ET

This post is in partnership with Worldcrunch, a new global-news site that translates stories of note in foreign languages into English. The article below was originally published in Die Welt.

Stale dry air, narrow seats, jammed overhead compartments: today's air passenger has to be a real flying nut to think plane travel is any fun. But engineers at European manufacturer Airbus say they're working on ways to improve things. Implementing the changes will probably take up to four decades, but they assure us the result will be more than worth the wait.

Flying in 2050 is going to be a real pleasure, the manufacturer says, with a 360-degree panoramic view whenever the "intelligent cabin membrane" is set on transparent, and a virtual golf course on board. Realistic projects, or overactive imaginations? "Engineers dream too," says Charles Champion, Airbus head of development. The Frenchman also points out that some of those dreams are already being implemented and may be launched in as little as 10 years from now.

One of the new ideas engineers are currently playing with involves harvesting passenger body heat to meet some of the plane's energy needs. Another idea refers to seats being upholstered with self-cleaning fabrics that adapt to each individual body form. (See photos of the "plane of the future.")

The first, business and economy class system would be abandoned: "It's not what people want," Champion says. Instead, there would be individual seating arrangements.

Innovations would by no means stop there. In the "vitalizing zone," for example, the air would be vitamin-enriched, while in the "interaction zone," passengers could enjoy virtual games of golf high up over the clouds, or go shopping and try on the latest fashions in virtual changing cabins. Through the cabin's transparent membrane, passengers would be able to gaze at the mountain peaks below them, and would be given information about the name of each summit and its exact height. State of the art communication with the ground would mean that business people could take part in video conferences at 33,000 feet, and that Mom or Dad could read bed time stories to their kids back home.

This cabin of the future - whose shape was modeled after birds - is part of Airbus's total concept for 2050. CEO Thomas Enders says the company expects the demand for aircraft to go up worldwide despite on-going problems faced by many airlines, particularly in Europe. (See 20 reasons to hate airlines.)

"Air travel continues to hold more long-term growth potential than virtually any other sector," Enders told the German newspaper "Welt am Sonntag." According to Airbus figures, air travel currently makes up 8%, or 580 billion dollars worth of the European gross domestic product. The sector employs 33 million people worldwide.

Airbus engineer Champion says that the three biggest current challenges are "that people want flying to be cheap, efficient and environmentally friendly." The sector has to find satisfactory answers to those demands, which is why flying will probably look completely different a few decades down the road. "By 2050, the sector will be hauling 9 billion passengers around the world," Champion says.

All that additional traffic will be possible thanks to new safety technologies that will enable companies to increase the number of flights fivefold. And instead of flying solo, planes could fly in formation and dock during flights to save on fuel. Airbus developers are even toying with the idea of huge airborne aircraft carriers that passenger planes could land on and be transported by. (See how airlines are cashing in on extras.)

Airbus' visions for airports of the future no longer include gates. Instead, planes would roll right up - subway style - to a station, with passengers boarding quickly through several doors with touch screens for the check in. Luggage would be put on a conveyor and stored in the cabin.

If Champion sees a sticking point, it concerns the airports themselves: "We can come up with all kinds of great stuff, but when a plane has to circle for 40 minutes over Heathrow before landing, a lot of it gets lost."

Also from Worldcrunch:

Human Trafficking in the Middle East
- Die Welt

Food Safety Scares in China Prompt Government to Choke Press Freedom
- Economic Observer

Surviving a Night in Zurich's Worst Hotel
- Tages Anzeiger

See 25 essential apps for travelers.

See the 25 all-TIME best animated features.

View this article on Time.com

Most Popular on Time.com:

Yahoo! News

Future of Air Travel: Airbus Predicts 'Transparent' Airplanes, 9 Billion Customers, By 2050 (Time.com)

By MICHAEL DONHAUSER / DIE WELT / WORLDCRUNCH Michael Donhauser / Die Welt / Worldcrunch – Sat Jun 25, 1:45 am ET

This post is in partnership with Worldcrunch, a new global-news site that translates stories of note in foreign languages into English. The article below was originally published in Die Welt.

Stale dry air, narrow seats, jammed overhead compartments: today's air passenger has to be a real flying nut to think plane travel is any fun. But engineers at European manufacturer Airbus say they're working on ways to improve things. Implementing the changes will probably take up to four decades, but they assure us the result will be more than worth the wait.

Flying in 2050 is going to be a real pleasure, the manufacturer says, with a 360-degree panoramic view whenever the "intelligent cabin membrane" is set on transparent, and a virtual golf course on board. Realistic projects, or overactive imaginations? "Engineers dream too," says Charles Champion, Airbus head of development. The Frenchman also points out that some of those dreams are already being implemented and may be launched in as little as 10 years from now.

One of the new ideas engineers are currently playing with involves harvesting passenger body heat to meet some of the plane's energy needs. Another idea refers to seats being upholstered with self-cleaning fabrics that adapt to each individual body form. (See photos of the "plane of the future.")

The first, business and economy class system would be abandoned: "It's not what people want," Champion says. Instead, there would be individual seating arrangements.

Innovations would by no means stop there. In the "vitalizing zone," for example, the air would be vitamin-enriched, while in the "interaction zone," passengers could enjoy virtual games of golf high up over the clouds, or go shopping and try on the latest fashions in virtual changing cabins. Through the cabin's transparent membrane, passengers would be able to gaze at the mountain peaks below them, and would be given information about the name of each summit and its exact height. State of the art communication with the ground would mean that business people could take part in video conferences at 33,000 feet, and that Mom or Dad could read bed time stories to their kids back home.

This cabin of the future - whose shape was modeled after birds - is part of Airbus's total concept for 2050. CEO Thomas Enders says the company expects the demand for aircraft to go up worldwide despite on-going problems faced by many airlines, particularly in Europe. (See 20 reasons to hate airlines.)

"Air travel continues to hold more long-term growth potential than virtually any other sector," Enders told the German newspaper "Welt am Sonntag." According to Airbus figures, air travel currently makes up 8%, or 580 billion dollars worth of the European gross domestic product. The sector employs 33 million people worldwide.

Airbus engineer Champion says that the three biggest current challenges are "that people want flying to be cheap, efficient and environmentally friendly." The sector has to find satisfactory answers to those demands, which is why flying will probably look completely different a few decades down the road. "By 2050, the sector will be hauling 9 billion passengers around the world," Champion says.

All that additional traffic will be possible thanks to new safety technologies that will enable companies to increase the number of flights fivefold. And instead of flying solo, planes could fly in formation and dock during flights to save on fuel. Airbus developers are even toying with the idea of huge airborne aircraft carriers that passenger planes could land on and be transported by. (See how airlines are cashing in on extras.)

Airbus' visions for airports of the future no longer include gates. Instead, planes would roll right up - subway style - to a station, with passengers boarding quickly through several doors with touch screens for the check in. Luggage would be put on a conveyor and stored in the cabin.

If Champion sees a sticking point, it concerns the airports themselves: "We can come up with all kinds of great stuff, but when a plane has to circle for 40 minutes over Heathrow before landing, a lot of it gets lost."

Also from Worldcrunch:

Human Trafficking in the Middle East
- Die Welt

Food Safety Scares in China Prompt Government to Choke Press Freedom
- Economic Observer

Surviving a Night in Zurich's Worst Hotel
- Tages Anzeiger

See 25 essential apps for travelers.

See the 25 all-TIME best animated features.

View this article on Time.com

Most Popular on Time.com:

Yahoo! News

Sombre Libyans contemplate Gaddafi's future (Reuters)

TRIPOLI (Reuters) – A chorus of white-clad girls, halos fixed to their heads and battery-powered candles clutched in their hands, sways in unison, then breaks into an off-key accompaniment of the 1980s anthem "We are the World."

Hours before the performance outside Muammar Gaddafi's Bab al-Aziziyah compound, broadcast live on state television, a Tripoli resident renders a different verdict on the fate of the capital after ten weeks of Western bombing.

"We are finished," says a man who identifies himself as Hamid, previously a driver for a Turkish construction firm. One of the firm's expatriate employees -- now evacuated from Libya -- said he believed Hamid was an informant for Libyan intelligence.

"The letter is sent. It comes from the skies. We just don't know the date," said Hamid.

As a NATO-led air campaign pounds Tripoli under the rubric of crippling Gaddafi's war against rebels who have seized Libya's east and hold pockets near the capital, his opponents and some supporters are beginning to count aloud the Libyan leader's remaining days in power.

Sporadic bursts of nighttime small-arms fire outside the hotel where the Libyan government houses foreign media have drawn out into lengthy exchanges, at times capped by the thud of a heavier weapon.

Libyan officials who in previous weeks called those episodes displays of pro-Gaddafi jubilance now decline to discuss them.

In a district that rose against Gaddafi in February, residents say protesters ventured out again this week, drawing gunfire from security forces. Activists have circulated a video appearing to show protesters denouncing Gaddafi in that area.

DISPLAYS OF LOYALTY

The accounts of overt dissent remain scattered, and displays of loyalty to the leader -- not least during state-sponsored events organized for the attention of foreign press -- are incessant.

Wariness of foreign media, whom government minders follow, remains high.

"We have no scoop," said the proprietor of an ice-cream shop, when asked for a cone by a foreign reporter who had spoken English to a colleague in his presence.

When reminded of the one lying on the counter before him, he replied: "Ah. That one doesn't work."

That reticence, however, fades more often and quickly than it once did.

Queues for petrol -- priced officially at 0.15 Libyan dinar ($0.125) per liter, but selling for 30 times that on the black market -- see frustration boil over into denunciation of the ruling elite, in the presence of security forces deployed warily at fuel stations.

"Who the hell are you?" screamed one motorist who leapt from his battered sedan when a sleek BMW attempted to nose into the middle of a petrol queue stretching for blocks not far from Libya's central bank.

"Why are you yelling at him?" shouted another. "It's the pimp who sent him to fill up for him, he owns everything."

"Remember the 500 dinars?" that motorist asked, referring to a hardship payment Libya's government announced in February when uprisings against Gaddafi erupted, but which few people say they have received since an initial payment.

"When you get it, come back and spend it."

Resignation emerges in less heated circumstances.

On a recent Friday, with streets abnormally empty before Muslim prayers, a merchant near Tripoli's port bitterly denounced the rebels.

"They're traitors, prostitutes, thieves. They are getting their wish from NATO," he said of the Benghazi-based rebels, led by defectors and now recognized by a handful of states as the country's rightful government.

"We will suffer more, soon. We will have chaos here, and we will starve. Already I can't restock some things," he said, pointing to a cardboard crate holding a few cans of artichokes.

Asked why he had opened with so few people on the streets, he replied: "It's better. I have to."

Another merchant in the neighborhood echoed his skepticism of the men who would inherit Libya, but blamed the leader and his family for sowing the seeds of an uprising.

"You cannot do this to people. You cannot pour all of the wealth into your pockets," he said, referring to Libya's oil revenue and the private sector business ventures that family members have controlled during abortive economic liberalization.

Invoking Gaddafi's call for Libyans to hunt down protesters -- whom he compared to vermin -- when demonstrations against his rule erupted in February, he said: "He saw the population as rats, so he thinks he can kill them. It is bringing the end for him and everyone else."

CENTURY OF BLOOD

Near the city's traditional quarter, where streets lined with vaulted arches lead to a square dominated by an Ottoman-era clock tower, a retired mathematics teacher placed Tripoli's present at the end of a century marked by blood.

"I am old enough to remember the king well, and I had relatives who were in the camps," said Rashed, who declined to use his full name, referring to Italy's colonial rule of Libya, which commenced in 1911 after the invasion of the formerly Ottoman territory.

Libyans recount the death of as much as half of the population in the late 1920s and early 1930s, when Italian colonial governors resorted to mass imprisonment in a bid to crush armed resistance to their rule.

Gaddafi invoked that experience after deposing the monarch who followed Italy's doomed colonial experiment, and while proclaiming a state of its people, subject to no one.

The leader of the anti-Italian resistance, Omar al-Mukhtar, figures prominently in the iconography of Gaddafi's besieged system of rule.

"He had support for putting an end to what Libya what suffered," said Rashed. "And now what he has made people suffer will be his end. I hope what happens will be for the best."

(Editing by Jon Hemming)

($1=1.198 Libyan Dinar)

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Panel: Casino industry's future is online (AP)

ATLANTIC CITY, N.J. – Internet gambling is the future of the casino industry, whether it's approved at the federal or state level, a panel of online and brick-and-mortar casino executives said Tuesday.

And a New Jersey lawmaker predicted there will be a ballot question next year asking his state's residents whether to amend the state Constitution to allow Internet gambling.

Speaking at the East Coast Gaming Congress, executives from two online betting organizations and Caesars Entertainment said the Internet provides the gambling industry its best opportunity for growth. But the prospect of a federal law permitting it appears dim in light of recent federal raids on online gambling sites.

"You're not going to stop the Internet," said Jan Jones, senior vice president of government relations for Caesars Entertainment. "You can regulate it, you can put in protections, but it's going to exist."

Melanie Brenner, president of the U.S. Online Gaming Association, said more than 10 million people currently play online poker.

"That's what they look forward to," she said. "This is the path to growth for (the casino) industry."

Panel members estimated the potential annual revenue from legalized Internet gambling in the U.S. at nearly $80 billion.

Richard Bronson, chairman of U.S. Digital Gaming, predicts individual states will approve online gambling soon. He said the recent raids by federal prosecutors on online poker web sites makes it unlikely the federal government will approve Internet gambling, leaving states an opportunity to do it on a piecemeal basis.

"I believe strongly there will not be a national online gambling bill passed in the U.S.," he said. "I've yet to find one governor, one legislator, one lottery director that tells me otherwise. They want this to be a state issue."

New Jersey was on the verge of becoming the first state in the nation to approve Internet gambling within its state borders. But Gov. Chris Christie vetoed a bill that would have permitted it, voicing concern about its legality. Christie suggested if New jersey legislators are serious about allowing Internet gambling, they should put a proposed Constitutional amendment before the voters and let them decide.

That's exactly what state Assemblyman John Burzichelli, a south Jersey Democrat, said the legislature plans to do.

"Next year there's probably going to be a question on the ballot to allow Internet gambling," he said. "Whether or not New Jersey voters amend the Constitution is up in the air. We came close, and we're going to do it again. We're going to take another run at it."

New Jersey law requires that all casino gambling in the state take place in Atlantic City. The bill Christie vetoed would have had the Atlantic City casinos maintain the servers, thus technically making the transactions happen in Atlantic City. Christie didn't buy that argument, and also worried about bars and restaurants setting up "Internet cafes" that would be fronts for illegal gambling.

In April, federal authorities busted the three largest online poker web sites in the United States on charges of bank fraud and illegal gambling against 11 people, accusing them of manipulating banks to process billions of dollars in illegal revenue. Prosecutors in Manhattan said they've issued restraining orders against more than 75 bank accounts in 14 countries used by the poker companies, interrupting the illegal flow of billions of dollars.

The companies, all based overseas, are PokerStars, Full Tilt Poker and Absolute Poker. The indictment seeks $3 billion in money laundering penalties and forfeiture from the defendants.

The indictment said the companies ran afoul of the law after the U.S. in October 2006 enacted the Unlawful Internet Gambling Enforcement Act, which makes it a crime for gambling businesses to knowingly accept most forms of payment in connection with the participation of another person in unlawful Internet gambling.

The American Gaming Association called the prosecutions a "half measure" toward fixing the problem and called for federally sanctioned licensing and regulation of online poker.

The association's president, Frank Fahrenkopf, said millions of Americans bet billions of dollars a year at foreign websites, and will continue to do so as long as there are sites they can access.

"In fact, in the immediate aftermath of online poker's April 15 `Black Friday,' some of the 300 companies that continued to operate in the U.S., in spite of the law, saw a surge in new business," he said. "Today, there are more than 1,000 real-money websites operated by these offshore operators that still target the U.S. market."

Because of that prosecution, individual states will try to approve Internet gambling solely within their own borders, panel members agreed. But they would lose out on a lucrative worldwide market that unscrupulous illegal website operators will fill, they added.

"If we look at this as a state opportunity, we will have lost the single largest opportunity for this industry," said Jones, the Caesars executive. "If you don't have that international capability — Europe, Asia — you can't go in there because you can't go outside your own state. You lost the worldwide opportunity."

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Battle brewing over biofuels' future

WASHINGTON — Imagine filling up the car on a fuel that isn't made from oil but doesn't have the drawbacks of corn ethanol, including its lower energy content and ability to damage older cars or gas pumps.

Such fuels could be made from the same sources as ethanol, including corn and corn cobs as well as straw, trees and other abundant types of biomass. But these fuels would be synthetic versions of today's gasoline, diesel and jet fuel. Unlike ethanol, a renewable version of gasoline could be used in any amount in today's engines, filling stations and pipelines.

The prospect of these fuels is coming up in a debate over the direction of the government's biofuel policy as Congress is slashing spending to reduce the budget deficit.

On one side is a collection of small companies, some backed by the oil industry, that are developing the non-ethanol biofuels. Those companies say that the government's subsidies for ethanol are unfairly favoring what they see as an inferior fuel.

On the other side is the ethanol industry, which is eager to expand its potential market and wants the government to guarantee loans for ethanol pipelines, subsidize installation of ethanol pumps at service stations and require automakers to equip cars and trucks to run on ethanol.

"There's a lot of great innovation taking place that is just on the cusp of commercialization. If policy does not consider that going forward, those innovative technologies may never get off the drawing boards," said Lee Edwards, CEO of Virent Energy Systems Inc., a Wisconsin-based company backed by Royal Dutch Shell. The company is starting to make gasoline from a mixture of sugar and water using a process similar to that used in a conventional oil refinery.

Products like Virent's are known as "drop-in" fuels because they can be put into the nation's existing fueling infrastructure and even produced at existing refineries.

Some in the ethanol industry "are trying to monopolize the fuels market for themselves," said Michael McAdams, a lobbyist for the Advanced Biofuels Association, which represents Virent and other companies.

'We're existing today'

The ethanol industry argues that those fuels are far from commercialization and that equipping service stations and cars to use more ethanol will reduce the country's dependence on fossil fuels more quickly. The ethanol industry is fast running out of a market for its fuel because of limits on how much ethanol can be blended into conventional gasoline.

"If the drop-in fuels crowd and industry wants to get out there and get started and compete, we're not opposed to that. I find it odd that they're opposed to our efforts to put money into the infrastructure," said Tom Buis, CEO of Growth Energy, an ethanol trade group.

Growth Energy's founders include Poet LLC, a leading producer of corn ethanol that also wants to be one of the first companies to commercialize the production of ethanol from a substance that doesn't double as a food source. Poet plans to make ethanol from corn cobs.

"We're not tomorrow's fuel. We're existing today," Buis said of ethanol.

What's needed is more government assistance for all biofuel sectors, said Matt Hartwig, a spokesman for another ethanol trade group, the Renewable Fuels Association. "We ought not to be fighting about dividing up the existing pie. We need to figure out ways to make that pie bigger."

But increasing biofuel subsidies will be difficult to do as Congress struggles with reducing the budget deficit. Lawmakers are also expressing frustration with the slow pace of development of alternatives to corn ethanol, a product that is drawing more and more criticism because of its effect on prices for feed grains and some foods.

Nearly 14 billion gallons of ethanol will be made from corn this year and a few million more from wood chips or other biomass sources. Except for biodiesel or a product called renewable diesel that's made from animal fats, drop-in fuels are still well in the future, especially any made from biomass. The Energy Information Administration doesn't forecast the country using more than a billion gallons a year in biomass-based drop-in fuels until after 2020.

The ethanol industry has an ally in Agriculture Secretary Tom Vilsack, who has argued for shifting ethanol subsidies into installation of pumps and other infrastructure.

But drop-in fuels have some well-placed supporters of their own. Energy Secretary Steven Chu, a Nobel laureate in physics, has said flatly that he doesn't consider ethanol the best biofuel, and the chairman of the Senate energy committee, New Mexico Democrat Jeff Bingaman, expressed concerns at a hearing last month that funding ethanol infrastructure could stifle the development of drop-in fuels.

Making drop-in fuels or ethanol from biomass feedstocks such as cobs, wheat straw, grasses and other types of plant cellulose is far more expensive than distilling ethanol from corn.

Any of the next-generation technologies have steep capital costs, however.

"There is room for all of these technologies. We need to give them all a chance," said Robert C. Brown, director of Iowa State University's Bioeconomy Institute. "We need to be real careful about betting on just one of these technologies."

The cost issue aside, drop-in fuels also are attractive to some officials at the Energy Department because they can potentially replace all of the products made from a barrel of oil. Ethanol displaces only gasoline.

That's important because replacing only gasoline upsets the economics of refineries and encourages oil companies to reduce capacity, which in turn could lead to rising prices for products such as diesel and jet fuel, said Paul Bryan, who directs the department's biomass program.

"If we don't start making things from biomass that replace those things, we're going to make life untenable for the petroleum refiners," Bryan said.

Turning feedstocks into fuel

Companies are working on a variety of drop-in products, but with the exception of algae the feedstocks are often the same ones now being used for ethanol.

Amyris Inc., a California company, is installing fermenters at a Tate and Lyle corn processing plant in Decatur, Ill., to turn corn sugar into a chemical called farnesene. The chemical can be used to make a renewable form of diesel, but initially it will be sold to make lubricants.

In Brazil, Amyris will make farnesene from cane sugar, the same feedstock now used there for making fuel ethanol. Eventually, the company's plan is to use the sugars found in plant cellulose.

"You give me sugar and I'll give you a hydrocarbon," said Joel Velasco, senior vice president of the company.

Virent is using beet sugar to make gasoline, but its goal is to eventually convert the sugars found in crop residue and other sources of plant cellulose into gasoline, said Edwards, a former executive with the oil giant BP.

The conversion facilities could be added either to existing refineries or to corn processing mills, he said.

Other companies are working on turning algae into diesel or jet fuel, which has a huge potential market with both the military and the airline industry.

Yet another potential drop-in fuel is butanol, which is an alcohol like ethanol but without the same drawbacks. Gevo Inc. of Englewood, Colo., bought a corn ethanol plant in Luverne, Minn., with plans to retrofit it to produce 18 million gallons of butanol a year from grain. Converting a larger, 100-million-gallon-a-year ethanol plant to produce butanol would cost about $40 million, said Jack Huttner, a Gevo executive.

DuPont, parent of Pioneer Hi-Bred, is working with BP to test a butanol production process in the United Kingdom with a view to commercializingthe fuel in the United States.

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At this shelter, art studio helps the homeless paint a brighter future

Artists among the homelessSTORY HIGHLIGHTSAn Atlanta homeless shelter has an unusual feature: An art studioDirector felt there are creative people who have fallen on hard timesOutsiders and shelter residents have formed an art community Artists keep part of painting sales, shelter portion goes for suppliesRELATED TOPICSVisual ArtsHomelessness Atlanta, Georgia (CNN) -- An art studio doesn't usually make anyone's list of what the homeless need.

But when Anita Beaty decided to start painting in the storefront window of a homeless shelter, people were soon looking in and asking to join.

"It seemed to me that there were lots and lots of creative people among folks who were experiencing homelessness," Beaty says.

And she would be familiar with their needs -- Beaty is the executive director of the Metro Atlanta Task Force for the Homeless. She'd been looking for a way to combine her love of art with her passion for eliminating poverty.

The art studio sits in the group's headquarters, a 1920s-era building on Peachtree Street in downtown Atlanta. Beaty says the homeless can find a secure place to paint and a creative community environment there.

To get their own free studio space, those interested must show some artistic ability and follow certain rules, including staying drug-free.

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