Brotherhood official urges Egypt's Jews to return

CAIRO (AP) — A leading Muslim Brotherhood member and adviser to Islamist President Mohammed Morsi created a stir in Egypt when he called on Egyptian Jews in Israel to return home because Egypt is now a democracy and because the Jewish state won't survive.
Essam el-Erian's remarks in a TV appearance put the Brotherhood, which holds power in Egypt, on the spot as opponents — and some allies — jumped on the comments to denounce the group. Morsi's office this week disassociated the president from the comments, saying they were el-Erian's personal opinion.
The criticism ran an unusual gamut of Egyptians' attitudes toward Jews, Israel and the Brotherhood itself.
Some denounced the Brotherhood for trying to put up a veneer of tolerance by inviting Jews to return while Egypt's other religious minorities, particularly Christians, are increasingly worried about persecution under the new Islamist rulers and an Islamist-slanted constitution.
Others saw the comments as a sort of outreach to Zionists, considered the enemy, and as a new example of how the Brotherhood has had a hard time melding its longtime anti-Israeli and anti-Jewish rhetoric with its new responsibilities since coming to power. Under Morsi — who hails from the Brotherhood — the government has continued cooperation with Israel, upheld the two countries' peace deal and Morsi last month helped mediate a cease-fire between Hamas and Israel.
Some warned that el-Erian was opening the door for Egyptian Jews to demand compensation for property taken from them or left behind in Egypt and could even undermine the Palestinians' right to return to homes in Israel. Still others were simply outraged that a Brotherhood official would invite back Jews, and one hardline Islamist politician threatened any Jews who come back.
And there were a few voices calling for Egypt to sincerely look at past treatment of its Jewish community — including why they left or were expelled — and whether they should have the right to return.
Speaking on private ONTV, historian Khaled Fahmy suggested taking el-Erian's comments at face value. "I am taking the call seriously. I would like to see it in part as respectable, as addressing morals and high principles." He said Egyptians should talk about the past "harm to Egyptian Jews" and consider them as still having Egyptian nationality.
"I wish this was put to a public discussion," he said.
Egypt's once thriving Jewish community largely left Egypt more than 60 years ago amid the hostilities between Egypt and Israel. Estimates say about 65,000 Jews left Egypt since the creation of the state of Israel in 1948, most of them to Europe and the West, with a small portion settling in Israel. Their departure was fueled by rising nationalist sentiment during the Arab-Israeli wars, harassment and some direct expulsions by then-President Gamal Abdel-Nasser, and attacks on Jewish properties, some of them blamed on the Brotherhood, which renounced violence in the 1970s.
Now only a handful of Jews, mostly elderly, remain in Egypt, along with a number of heavily guarded synagogues, open only to Jews.
El-Erian, who is also deputy of the Brotherhood's political party, made his comments last week on a late night talk show on the private station Dream TV.
"I wish our Jews return to our country, so they can make room for the Palestinians to return, and Jews return to their homeland in light of the democracy" evolving in Egypt, he said. "I call on them now. Egypt is more deserving of you."
"Why stay in a racist entity, an occupation, and be tainted with war crimes that will be punished, all occupation leaders will be punished," he said. He added in separate comments that the Zionist "project" will end.
The comments didn't make much of an impact in Israel, and there was no official comment about them and little discussion of them in the press. In contrast, they raised widespread ridicule and debate in Egypt on TV shows, newspapers and social websites.
Belal Fadl, a popular Egyptian columnist and satirical writer, said the comments were hypocritical given other Brotherhood officials' statements accusing Egypt's Christians of threatening Morsi's legitimacy as president, fueling anger against the minority community.
"How can we believe the tolerance of el-Erian amid all the sectarian statements by leaders of the groups and other sheiks that all seek to chase away Egypt's Christians in the footsteps of the Jews," Fadl wrote in the daily al-Shorouk Thursday.
Youssef el-Husseini, a prominent TV presenter known for his liberal views and harsh criticism of Morsi and the Brotherhood, said el-Erian was showing a fake tolerance for Jews to impress Israel and the United States — setting aside the anti-Israel parts of his statement. El-Husseini said that if a liberal made the comments he would be branded a traitor and would be accused of inviting Zionists back to Egypt.
"Is el-Erian flirting with the Zionist state to say we are fine and you are friends," el-Husseini said on a Sunday morning talk show. "Or is he flirting with Obama" because of U.S. aid to Egypt. "Is the group taking their political garb bit by bit?"
On Tuesday, Morsi's spokesman said the presidency is not responsible for comments made by el-Erian. "These are his personal opinion," Yasser Ali, the presidential spokesman said.
Mohammed Salmawy, the head of Egypt's Writers Union, called el-Erian's comments "delirium."
"What is this superficial understanding of matters that borders naiveté?" he wrote, saying the problem of Palestinian refugees is not one of "making room" for their return.
"What the Jews who were living in Egypt want is not to return, particularly in the current circumstances. What they want is compensation for their properties" they left behind.
He said el-Erian was recognizing a right of return for Israeli Jews of Arab origin, which he said would allow for a quid-pro-quo forcing Palestinians refugees to drop their demand to return to homes in Israel so that Jews drop demands to return to Arab nations.
"It seems the way to deny the Palestinians the right of return or compensation is to exchange that right for ... the right of the return of Jewish refugees to Arab countries," he wrote Thursday.
The leading member of a former Islamic militant group, Gamaa Islamiya, which is now a political party allied to the Brotherhood, simply said Jews were not welcome back.
Quoted in the Rose el-Youssef newspaper, Tarek el-Zumor said his group will not tolerate their return "except over our dead bodies or after they change their religion and become Muslims.

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Activists: At least 9 killed by Damascus car bomb

BEIRUT (AP) — A car bomb blew up late Thursday in a Damascus gas station, killing at least nine people, a Syrian activist group said.
The Britain-based Syrian Observatory for Human Rights said the death toll in the blast in the capital's Masakin Barzeh neighborhood is expected to rise because many of the wounded were in critical condition.
Syria's state news service also reported the blast but did not give a number of dead or wounded. It said the bomb targeted cars that were lined up to get gas and blamed the attack on "terrorists," the government's shorthand for rebels seeking to topple President Bashar Assad.
The pro-regime Ikhbariyeh TV station said some 30 civilians were killed or wounded in the blast.
Despite gains in other parts of Syria by rebels seeking to topple Assad, he has largely kept his grip on the capital.
But Damascus has been targeted by a number of large bombings, many of which appear to target government buildings. Some have been claimed by the jihadist group Jabhat al-Nusra, which the U.S. has designated a terrorist organization.
There was no immediate claim of responsibility for Thursday's blast.
Masakin Barzeh is a middle-class neighborhood northeast of downtown that is home to many government employees.
The U.N. says more than 60,000 people have been killed in Syria since the start of the uprising in March 2011. The conflict has since evolved into a civil war.

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Rebel area shows limits of rebel push for Damascus

Twin airstrikes by government jets on a large, rebel-held suburb of Damascus on Thursday sheered the sides off apartment towers and left residents digging through rubble for the dead and wounded.
The bombing of Douma came amid a wave of attacks on rebellious districts of the Syrian capital, part of the government's efforts to keep rebel fighters out of President Bashar Assad's seat of power. Late Thursday, a car bomb exploded at a gas station inside the city itself, killing at least nine people, activists said.
Douma, the largest patch of rebel-held ground near Damascus, illustrates why the opposition's advance on the capital has bogged down. Despite capturing territory and setting up committees to provide basic services, the rebels lack the firepower to challenge Assad's forces and remain helpless before his air force.
That stalemate suggests the war will not end soon. The U.N. said Wednesday that more than 60,000 people have been killed since March 2011 — a figure much higher than previous opposition estimates.
Rebels took control of Douma, a suburb of some 200,000 located nine miles (15 kilometers) northwest of Damascus, in mid-October 2011, after launching attacks on military posts throughout the city, activists said.
Less than a week later, the rebels had taken over a half-dozen checkpoints and government buildings, said activist Mohammed Saeed. The army withdrew from others.
"Since then, the city has been totally liberated," he said. "There are no government troops left, but we still suffer from regime airstrikes almost every day."
Today, those entering Douma must pass through rebel checkpoints at the city's main entryways. Rebels with camouflage vests and Kalashnikov rifles zip about on motorcycles, communicating by walkie-talkie. Some belong to the security brigade, an improvised police force to catch looters that works with a judicial council of Muslim clerics and lawyers who run a prison.
In November, residents formed a civilian council to provide services for the estimated one-third of Douma's residents who have not fled the violence.
The council oversees committees for medical issues, bakeries, media relations and other tasks, said its head, Nizar Simadi. A former cleaner at city hall runs a cleanup crew that helps remove rubble from the streets after shell attacks and airstrikes.
The city's electricity went out in November — activists accuse the government of cutting it in revenge — but former electric company employees have strung in power from nearby areas still on the government network, returning power to some of the city.
Douma has more than a dozen rebel brigades, and the city's fighters have joined battles in many other areas around the capital. Most of their support comes from wealthy Syrians abroad who send money to buy arms, said the head of one rebel brigade, the Douma Martyrs, who goes by the name Abu Waleed.
In November, Douma's fighters raided two army bases in the nearby suburb of Otaya, he said, making away with arms that helped them push closer to Damascus. But they can do little about the government's airstrikes.
Rebel forces are currently fighting the government in areas on three sides of the capital. They are closest in the south, where they have pushed into the poor Damascus neighborhood of Hajar al-Aswad. Recent weeks have also seen fierce clashes in the southwestern suburb of Daraya, which the government says it is close to reclaiming.
During Thursday's airstrikes on Douma, a government fighter jet launched two bombing runs on a densely populated residential area near a prominent mosque, said Saeed, the activist.
Videos posted online showed residents rushing though a smoke-filled street and loading wounded people into cars and pickup trucks. One man was buried up to his thigh in debris and helped rescuers dig himself out. Another man emerged from a pile of rubble with blood on his face and covered head-to-toe in gray cement dust.
One group provided videos of 12 people they said were killed in the attack. The videos appeared genuine and corresponded to other AP reporting on the strike.
The Britain-based Syrian Observatory for Human Rights said at least 10 rebel fighters and 32 civilians were killed Thursday in clashes, shelling and airstrikes in the Damascus Countryside province that surrounds the capital, more than anywhere else in Syria.
Late Thursday, a car bomb exploded at a gas station inside the city itself, killing at least nine people, activists said. Syria's state news agency blamed the attack on "terrorists," its shorthand for the rebels, but did not give numbers for the dead and wounded. There was no immediate claim of responsibility.
Despite rebel advances near Damascus, it remains unclear whether they'll be able to turn the tables on Assad's forces. Rebels launched a hasty offensive on Damascus last summer but were swiftly routed by government forces.
Before attempting to take Damascus again, Saeed said the rebels must gather enough ammunition to sustain the battle, take over nearby army bases to prevent attacks from behind and increase coordination between rebel brigades.
He guessed that could take six months.
The Syrian government has not commented on the fall of Douma to rebels, whom it characterizes as terrorists backed by foreign powers seeking to destroy the country.
The chief of staff of Syria's armed forces called on the army to continue its "holy and national task to crush the armed terrorist groups and their hideout," the state news agency reported.
Gen. Abdullah Ayoub said the "conspiracy" against Syria would fail "thanks to the bravery of the Syrian army and the coherence of the Syrian people."
Activists reported clashes in a number of other parts of Syria on Thursday, including inside the Taftanaz helicopter base in the north.
In Jordan, the U.N. refugee agency said that around 1,200 people have fled across Syria's southern border each day for the past three days, an increase reflecting fresh violence in the south. UNHCR reporting officer Danita Topcagic said many shops in the area were shut, making it hard for people to find food, and that electricity and water supplies were short.
About a half-million Syrians have sought refuge from the war in neighboring countries, and many more are displaced inside Syria.
Meanwhile, the parents of an American journalist who has been missing in Syria since he was kidnapped Nov. 22 appealed to his captors for compassion and any information about their son's health and welfare. Thirty-nine-year-old James Foley was in the country contributing videos to Agence France-Press, which has vowed to help secure his release.
Twenty-eight journalists were killed in Syria in 2012, prompting the Committee to Protect Journalists to name Syria the most dangerous country in the world to work in last year.

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Fiscal-cliff deal no recipe for a robust economy

Housing is rebounding. Families are shrinking debts. Europe has avoided a financial crackup. And the fiscal cliff deal has removed the most urgent threat to the U.S. economy.
So why don't economists foresee stronger growth and hiring in 2013?
Part of the answer is what Congress' agreement did (raise Social Security taxes for most of us). And part is what it didn't do (prevent the likelihood of more growth-killing political standoffs).
By delaying painful decisions on spending cuts, the deal assures more confrontation and uncertainty, especially because Congress must reach agreement later this winter to raise the government's debt limit. Many businesses are likely to remain wary of expanding or hiring in the meantime.
One hopeful consensus: If all the budgetary uncertainty can be resolved within the next few months, economists expect growth to pick up in the second half of 2013.
"We are in a better place than we were a couple of days ago," Chad Moutray, chief economist for the National Association of Manufacturers, said a day after Congress sent President Barack Obama legislation to avoid sharp income tax increases and government spending cuts. But "we really haven't dealt with the debt ceiling or tax reform or entitlement spending."
Five full years after the Great Recession began, the U.S. economy is still struggling to accelerate. Many economists think it will grow a meager 2 percent or less this year, down from 2.2 percent in 2012. The unemployment rate remains a high 7.7 percent. Few expect it to drop much this year.
Yet in some ways, the economy has been building strength. Corporations have cut costs and have amassed a near-record $1.7 trillion in cash. Home sales and prices have been rising consistently, along with construction. Hiring gains have been modest but steady. Auto sales in 2012 were the best in five years. The just-ended holiday shopping season was decent.
Bernard Baumohl, chief global economist for the Economic Outlook Group, thinks the lack of finality in the budget fight is slowing an otherwise fundamentally sound economy.
"What a shame," Baumohl said in a research note Wednesday. "Companies are eager to ramp up capital investments and boost hiring. Households are prepared to unleash five years of pent-up demand."
The economy might be growing at a 3 percent annual rate if not for the threat of sudden and severe spending cuts and tax increases, along with the haziness surrounding the budget standoff, says Ethan Harris, co-director of global economics at Bank of America Merrill Lynch.
Still, Congress' deal delivered a walloping tax hike for most workers: the end of a two-year Social Security tax cut. The tax is rising back up to 6.2 percent from 4.2 percent. The increase will cost someone making $50,000 about $1,000 a year and a household with two high-paid workers up to $4,500.
Mark Zandi, chief economist at Moody's Analytics, calculates that the higher Social Security tax will slow growth by 0.6 percentage point in 2013. The other tax increases — including higher taxes on household incomes above $450,000 a year — will slice just 0.15 percentage point from growth, Zandi says.
Congress' deal also postpones decisions on spending cuts for military and domestic programs, including Medicare and Social Security. In doing so, it sets up a much bigger showdown over raising the government's borrowing limit. Republicans will likely demand deep spending cuts as the price of raising the debt limit. A similar standoff in 2011 brought the government to the brink of default and led Standard & Poor's to yank its top AAA rating on long-term U.S. debt.
Here's how key parts of the economy are shaping up for 2013:
— JOBS
With further fights looming over taxes and spending, many companies aren't likely to step up hiring. Congress and the White House will likely start battling over raising the $16.4 trillion debt limit in February.
Many economists expect employers to add an average of 150,000 to 175,000 jobs a month in 2013, about the same pace as in 2011 and 2012. That level is too weak to quickly reduce unemployment.
The roughly 2 million jobs Zandi estimates employers will add this year would be slightly more than the 1.8 million likely added in 2012. Zandi thinks employers would add an additional 600,000 jobs this year if not for the measures agreed to in the fiscal cliff deal.
Federal Reserve policymakers have forecast that the unemployment rate will fall to 7.4 percent, at best, by year's end. Economists regard a "normal" rate as 6 percent or less.
— CONSUMER SPENDING
Consumer confidence fell in December as Americans began to fear the higher taxes threatened by the fiscal cliff. Confidence had reached a five-year high in November, fueled by slowly declining unemployment and a steady housing rebound. Consumer spending is the driving force of the economy.
But the deal to avoid the cliff won't necessarily ignite a burst of spending. Taxes will still rise for nearly 80 percent of working Americans because of the higher Social Security tax rate.
Since the recession officially ended in June 2009, pay has barely kept up with inflation. The Social Security tax increase will cut paychecks further. And with the job market likely to remain tight, few companies have much incentive to hand out raises.
Thanks to record-low interest rates, consumers have whittled their debts to about 113 percent of their after-tax income. That's the lowest share since mid-2003, according to Haver Analytics. And the delinquency rate for users of bank credit cards is at an 18-year low, the American Bankers Association reported Thursday.
Yet that hardly means people are ready to reverse course and ramp up credit-card purchases. Most new spending would have to come from higher incomes, says Ellen Zentner, senior economist at Nomura Securities.
"We don't see the mindset of, 'Let's run up the credit card again,'" she says.
— HOUSING
Economists are nearly unanimous about one thing: The housing market will keep improving.
That's partly because of a fact that's caught many by surprise: Five years after the housing bust left a glut of homes in many areas, the nation doesn't have enough houses. Only 149,000 new homes were for sale at the end of November, the government has reported. That's just above the 143,000 in August, the lowest total on records dating to 1963. And the supply of previously occupied homes for sale is at an 11-year low.
"We need to start building again," says Patrick Newport, an economist at IHS Global Insight.
Sales of new homes in November reached their highest annual pace in 2½ years. They were 15 percent higher than a year earlier. And October marked a fifth straight month of year-over-year price increases in the 20 major cities covered by the Standard & Poor's/Case-Shiller national home price index.
Potential homebuyers "are more likely to buy, and banks are more likely to lend" when prices are rising, says James O'Sullivan, chief U.S. economist at High Frequency Economics. "It feeds on itself."
Higher prices are also encouraging builders to begin work on more homes. They were on track last year to start construction of the most homes in four years.
Ultra-low mortgage rates have helped spur demand. The average rate on the U.S. 30-year fixed mortgage is 3.35 percent, barely above the 3.31 percent reached in November, the lowest on records dating to 1971.
Housing tends to have an outside impact on the economy. A housing recovery boosts construction jobs and encourages more spending on furniture and appliances. And higher home prices make people feel wealthier, which can also lead to more spending.
"When you have a housing recovery, it's nearly impossible for the U.S. economy to slip into recession," Zentner says.
— MANUFACTURING
Factories appear to be recovering slowly from a slump last fall. The Institute for Supply Management's index of manufacturing activity rose last month from November. And a measure of employment suggested that manufacturers stepped up hiring in December. Factories had cut jobs in three of the four months through November, according to government data.
Another encouraging sign: Americans are expected to buy more cars this year. That would help boost manufacturing output. Auto sales will likely rise nearly 7 percent in 2013 over last year to 15.3 million, according to the Polk research firm. Sales likely reached 14.5 million last year, the best since 2007. In 2009, sales were just 10.4 million, the fewest in more than 30 years.
And if Congress can raise the federal borrowing limit without a fight that damages confidence, companies might boost spending on computers, industrial machinery and other equipment in the second half of 2013, economists say. That would help keep factories busy.

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Auto industry posts best U.S. sales year since 2007

U.S. auto sales rose 9 percent in December, led by foreign manufacturers, capping off the best year for the industry since before the recession.
The year's sales were driven by a slowly recovering economy, more available credit and the need for consumers and businesses to replace aging cars and trucks.
General Motors Co posted December U.S. sales growth of 5 percent compared with the year-earlier month, Ford Motor Co increased sales 2 percent and Chrysler Group LLC's sales rose 10 percent.
Wall Street cheered the results, sending GM and Ford stock to their highest levels since July 2011. GM shares ended 2.4 percent higher at $29.82 and Ford shares were up 2 percent to end at $13.46 on Thursday.
Research and consulting firm Polk said it expects U.S. auto sales to hit 15.3 million vehicles in 2013. GM and Ford both predicted industry sales of more than 15 million vehicles, but Toyota Motor Corp offered a more modest forecast of 14.7 million vehicles.
For the year just ended, U.S. auto sales rose 13.5 percent to nearly 14.5 million new vehicles, the best performance since 2007, according to Reuters calculations.
In the decade prior to 2008 when the recession slowed the industry, U.S. auto sales averaged nearly 17 million vehicles a year.
While last month's auto sales showed little impact of jitters caused by the so-called fiscal cliff - which proved largely averted - automakers expressed worry over the fog of uncertainty still emanating from Washington.
The impact of a payroll tax increase that took effect at the start of the year and the upcoming congressional debate over raising the U.S. debt ceiling may keep some consumers out of the market in 2013, several automakers said.
"It would have been nice if all the open questions had been resolved in the 'fiscal cliff' discussion over the holiday, but clearly they weren't, and that does extend this period of uncertainty from a consumer point of view," Jonathan Browning, head of Volkswagen AG's American unit, told reporters on a conference call.
A 2 percentage-point payroll tax increase will take about $1,000 from the average household budget, said Ford economist Ellen Hughes-Cromwick.
"It is something that we're looking at very carefully, as it will crimp the consumer spending scene somewhat in the months ahead," said Hughes-Cromwick.
Jesse Toprak, analyst with TrueCar.com, said the hit to households would be about the same amount as a down payment on a new vehicle.
"The cheap financing and improved income will make up for that, but that's something we're going to have a keep an eye on," he said.
Hughes-Cromwick said the tax increases for the wealthiest Americans will not greatly affect auto sales, because they tend to purchase new vehicles even if taxes change.
Tom Libby, an analyst at Polk, said continued low interest rates along with an improved housing sector and new product offerings from major automakers will make 2013 a bullish year for the industry.
Detroit's automakers showed December U.S. sales gains of 5 percent, slightly better than analysts' expectations, but not enough to stave off market-share gains by Toyota and Honda Motor Co Ltd .
The two largest Japanese automakers in the U.S. market rebounded from poor showings in 2011 when their inventory was constrained after the Japan earthquake and tsunami.
Toyota reported a 9 percent U.S. sales increase for December, which met analysts' expectations. Honda's December sales rose 26 percent but fell short of analysts' expectations. Honda sales are up 24 percent on the year.
Toyota's 2012 U.S. sales rose about 27 percent, compared with gains of 3.7 percent for GM, 4.7 percent for Ford, and 21 percent for Chrysler.
U.S. MARKET SHARE
GM's U.S. market share is now at its lowest level since at least 1960, and probably at a low not seen since 1930, according to industry journal Ward's Auto.
GM and Ford lost market share in 2012, dented by competition from Toyota and Honda which recovered from 2011 earthquake-related setbacks.
GM's 2012 market share fell to 17.9 percent from 19.6 percent in 2011. Its market share was 23.5 percent in 2007, before the recession. Ford's 2012 market share fell to 15.5 percent from 16.8 percent in 2011.
"We're always concerned about market share - always," said Mark Reuss, GM chief in North America. "But we're not going to give it away like we did in the past and burn the residuals and the brand values in anticipation of the biggest product portfolio launch that we've had in history."
Reuss referred to the years before GM's 2009 bankruptcy and taxpayer bailout, when vehicle production outpaced demand and it layered on incentives to lower prices for consumers.
The F-Series pickup truck from Ford, the top-selling vehicle in North America for more than three decades, had its best sales month in December since August 2007.
The F-Series remained the best-selling vehicle in the United States, with annual sales of 645,316, followed again by the full-size Chevrolet Silverado pickup, at 418,312.
BMW WINS LUXURY CROWN
Most luxury brands had a good year. BMW for the second straight year edged German rival Mercedes-Benz for the U.S. sales crown, followed by Toyota's Lexus and Honda's Acura.
The two U.S. luxury brands both saw sales fall in 2012, with Cadillac down 1.7 percent and Lincoln off 4.1 percent.
Japanese models swept the next four places, with Toyota Camry leading the Honda Accord, Honda Civic and Nissan Altima. Chrysler's Ram pickup placed seventh, followed by Toyota Corolla, Ford Escape and Ford Focus.
Both GM and Ford went into the recession that began in late 2007 - and into 2008 when gasoline prices spiked - overladen with low-mileage big pickup trucks and SUVs.
GM said on Thursday that in 2012 it sold in the U.S. market more than 1 million vehicles that get at least 30 miles per gallon in highway driving. And Ford said that in the year it sold the most small cars since 2001.
Sales of high-profile hybrid and electric vehicles were a mixed bag in 2012. GM's Chevrolet Volt tripled sales to 23,461, but still fell well short of the company's original goal of 40,000 vehicles. Nissan's Leaf was virtually flat, at 9,819.
Toyota maintained its lead in the green-car category, with total Prius sales of 236,659, up 73 percent with the addition of three new Prius derivatives in the past year.
Chrysler easily beat analysts' expectations and had its 33rd consecutive month of year-on-year sales gains. Its annual sales rose 21 percent. Its market share in 2012 rose to 11.4 percent from 10.7 percent in 2011. Chrysler is majority-owned by Italian automaker Fiat SpA .
Sales for South Korea's Hyundai Motor Corp and Kia Motors Co rose 5 percent. Hyundai, the larger of the sister companies, reported full-year U.S. sales of 703,007 vehicles, a company record.
Volkswagen reported a monthly increase of 31.5 percent for its namesake brand and luxury brands Audi and Porsche and a 30 percent gain for the full year.
December sales fell 12 percent for Lincoln, Ford's luxury brand.
Aided heavily by consumer incentives that reduce the price of the vehicles, GM in December dramatically trimmed its inventory of full-size pickup trucks to 80 days of supply from 139 days at the end of November. Most automakers like to have about 80 days of supply of these pickup trucks.
For the overall industry, the pace of annual sales increases has been in the double digits since the market bottomed in 2009, when it hit the worst annual sales rate since World War Two, adjusting for population.

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Economy, year-end sales help auto industry in 2012

DETROIT (AP) — A steadily improving economy and strong December sales lifted the American auto industry to its best performance in five years in 2012, especially for Volkswagen and Japanese-brand vehicles, and experts say the next year should be even better.
Carmakers on Thursday announced their final figures, which totaled 14.5 million — 13 percent better than 2011.
More than three years after the federal government's $62 billion auto-industry bailout, Americans had plenty of incentive to buy new cars and trucks in the year just ended.
Unemployment eased. Home sales and prices rose. And the average age of a car topped 11 years in the U.S., a record that spurred people to trade in old vehicles. Banks made that easier by offering low interest rates and greater access to loans, even for buyers with lousy credit.
"The U.S. light vehicle sales market continues to be a bright spot in the tremulous global environment," said Jeff Schuster, senior vice president of forecasting for LMC Automotive, a Detroit-area industry forecasting firm.
Sales were far better than the bleak days after the U.S. economy tanked and GM and Chrysler sought bankruptcy protection. Back then, sales fell to a 30-year low of 10.4 million, and they are still far short of the recent peak of around 17 million set in 2005.
The best part of 2012 came at the end, when special deals on pickup trucks and the usual round of sparkling holiday ads helped December sales jump 9 percent to more than 1.3 million, according to Autodata Corp. That translates to an annual rate of 15.4 million, making December the strongest month of the year.
Volkswagen led all major automakers with sales up a staggering 35 percent, led by the redesigned Passat midsize sedan. VW sold more than five times as many Passats last year as it did in 2011.
Jesse Toprak, vice president of industry trends for TrueCar, said VW has the right mix of value and attractive vehicles and called the company "the force to watch in the next several years in the U.S. market."
Toyota, which has recovered from the earthquake and tsunami in Japan that crimped its factories two years ago, saw sales jump 27 percent for 2012. December sales were up 9 percent. Unlike 2011, the company had plenty of new cars on dealer lots for most of last year.
Honda sales rose 24 percent for the year. Nissan and Infiniti sales were up nearly 10 percent as the Nissan brand topped 1 million in annual sales for the first time. Hyundai sales rose 9 percent for the year to just over 703,000, the Korean automaker's best year in the U.S.
Chrysler, the smallest of the Detroit carmakers, had the best year among U.S. companies. Its sales jumped 21 percent for the year and 10 percent in December. Demand was led by the Jeep Grand Cherokee SUV, Ram pickup and Chrysler 300 luxury sedan.
But full-year sales at Ford and General Motors lagged. Ford edged up 5 percent and GM rose only 3.7 percent for the year. For December, Ford was up 2 percent and GM up 5 percent.
GM executives said the company has the oldest model lineup in the industry, yet it still posted a sales increase and commanded high prices for cars and trucks. The company plans to refurbish 70 percent of its North American models in the next 18 months and expects to boost sales this year.
North American President Mark Reuss said the company won't give away cars and trucks with discounts like it has in the past, especially in the midst of its biggest product update ever.
"Give us 18 months and you're going to see the whole portfolio turned," Reuss said.
Even though the congressional deal to avoid the fiscal cliff deal raised tax rates on the wealthiest Americans, Ford said it doesn't see a huge impact on auto sales.
Its chief economist, Ellen Hughes-Cromwick, said only 2 percent of new-vehicle buyers have income in that upper tax bracket, and they tend to purchase even if there is a change in after-tax income.
She said Ford is more concerned about an increase in the payroll tax, which is scheduled to climb to 6.2 percent this year from 4.2 percent in 2011 and 2012. That amounts to a $1,000 to $1,500 tax increase per household, she said.
"We will look at that closely because it will crimp spending in the months ahead," she said.
December featured year-end deals on GM's big pickup trucks. The company offered discounts up to $9,000 to help clear growing inventory, and it worked. GM cut its full-size pickup supply by more than 20,000 in December to about 222,000.
Overall, though, analysts said the industry eased up on promotions such as rebates and low-interest financing. Car and truck buyers paid an average of $31,228 per vehicle last month, up 1.8 percent from December 2011.
The Polk auto research firm predicted even stronger U.S. sales for 2013, forecasting 15.3 million vehicle sales as the economy continues to improve. Polk, based in Southfield, Mich., expects 43 new models to be introduced, up 50 percent from last year. New models usually boost sales.
The firm also predicts a rebound in sales of large pickups and midsize cars. All eight of the top manufacturers are introducing new vehicles, and that should bring competition and lower prices in those segments, according to Tom Libby, lead North American analyst for Polk.
But the firm's optimistic forecasts hinge on Washington reaching an agreement on government debt limits and spending cuts.

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Fracking can be done safely in New York state: dept report

The natural gas drilling process known as fracking would not be a danger to public health in New York state so long as proper safeguards were put into place, according to a health department report that environmentalists fear could help lift a moratorium on the controversial technique.
Governor Andrew Cuomo is weighing the economic benefits of hydraulic fracturing - commonly known as fracking - against the environmental risks from a technology that could unlock a vast domestic energy supply but also one that environmentalists say pollutes groundwater and the air.
Potential hazards could be avoided by implementing precautions the state has identified, according to a February 2012 preliminary assessment from the New York State Department of Health that became widely reported in the media on Thursday.
"Significant adverse impacts on human health are not expected from routine HVHF," or high volume hydraulic fracturing, the document concluded.
Natural gas drilling in New York state could create $11.4 billion in economic output and raise $1.4 billion in state and local tax revenue, according to a July 2011 report from the Manhattan Institute, a conservative-leaning think tank.
Fracking is the process of releasing natural gas and oil from rock deposits deep underground by fracturing shale formations with chemical-laced water and sand.
The release of the document came as Cuomo's government continued to deliberate whether to overturn a 4-year-old moratorium on fracking originally put in place to assess the effects of the drilling process.
The Department of Environmental Conservation is the lead agency studying fracking, with contributions from other departments such as health.
In late November, the Department of Environmental Conservation was granted a 90-day extension to its original deadline for completing a draft of fracking regulations in order for its environmental impact study to be reviewed by the state health commissioner and outside health experts.
Since the preliminary assessment was put together nearly a year ago, was incomplete, and did not reflect the input of these experts, it does not reflect the final policy of the Department of Environmental Conservation, spokeswoman Emily DeSantis said in an email.
"I sincerely hope that this is not where the administration is going with the health review," said Katherine Nadeau of Environmental Advocates, a group concerned over the state's plans for fracking.
"It is nothing more than a justification for not doing a health review and a defense for the plans and proposals they've already put out there," said Nadeau, who had reviewed the document.
The Independent Oil and Gas Association of New York, which represents oil and gas producers in the state, called on the Cuomo administration to lift the moratorium because the experience of other states has shown that fracking could be done in a way that protects the environment and public health.
"All ongoing environmental reviews, including New York's health assessment, will make similar conclusions," Brad Gill, the group's executive director, said in an emailed statement.
The precautions the health department document proposed for the state to put into place were of varying specificity. For example, the transport of drilling water that flows back out of wells after fracking should be subject to similar requirements to the treatment of medical waste.

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