Air raid on petrol station in Damascus suburb kills 30: activists

AMMAN (Reuters) - At least 30 civilians were killed on Wednesday when Syrian warplanes bombed a petrol station in a rebellious suburb on the eastern edge of Damascus, two opposition campaigners on the scene said.

"I counted at least 30 bodies. They were either burnt or dismembered," said Abu Saeed, an activist who arrived at the area in the Muleiha suburb of Damascus an hour after the raid occurred at 1:00 PM (1100 GMT).

Another activist, Abu Fouad, said warplanes had bombarded the area as a consignment of fuel arrived and crowds packed the station.

Video footage taken by activists, which could not be independently verified, showed a body of a man a helmet on a motorcycle amid flames that had engulfed the site, apparently hit while in a line of vehicles waiting for petrol. A man was also shown carrying a dismembered body.

Muleiha is one of a series of Sunni Muslim suburbs ringing the capital that have been at the forefront of the 21 month revolt against the rule of President Bashar al-Assad, who belongs to the Shi'ite-derived Alawite minority sect.

Government forces control the center of Damascus and have been pounding the suburbs from the air.

(Reporting by Khaled Yacoub Oweis, Amman newsroom; Editing by Peter Graff)

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Tennis: Impressive Azarenka reaches Brisbane International quarter-finals

BRISBANE, Australia: World number one Victoria Azarenka moved into the quarter-finals of the Brisbane International with a hard-fought 6-3, 6-3 win over German Sabine Lisicki on Wednesday.

Azarenka was made to work hard for her win by the hard-hitting Lisicki, who traded punishing ground strokes with the top seed but was let down by a high error rate -- 36 unforced errors compared with only nine from her opponent.

In a match much closer than the score suggests, Lisicki had her chances but was unable to take them.

She had eight break points on Azarenka's serve but was only able to convert three, whereas Azarenka -- who won her maiden WTA title in Brisbane in 2009 -- broke Lisicki six times to seize the advantage.

The German also served poorly, landing only 52 per cent of her first serves and sending down five double faults. But she stayed in the match thanks to the quality of her hitting from the baseline.

"I knew what kind of player she is and I felt like she did improve from maybe the last time we played," Azarenka said.

"I just knew that there is something that I have to deal with. So I was prepared to take some bullets today.

"But I just tried to stay focused on executing my game. I knew she was going to make some, she was going to miss some, so I just had to stay with her and look for my chance."

Azarenka now plays Kazakhstan qualifier Ksenia Pervak in the quarter-finals.

Earlier, Germany's Angelique Kerber, the only player to defeat Serena Williams since the French Open in May, came from behind to beat unheralded Puerto Rican Monica Puig in three sets.

The 24-year-old fourth-seed looked in huge trouble as she trailed 1-4 in the third set but fought back to force a tiebreak.

Puig then led 4-0 in the tiebreak only for Kerber to fight back again and take the match 3-6, 6-4, 7-6 (9/7) in two and a half hours.

She will next take on Russia's Anastasia Pavlyuchenkova in the quarter-finals.

"I was just thinking point by point (when she was down in the third set)," Kerber said.

"I was not thinking 'What's happening?' I was just really on court and just trying to hit the ball, move very well, and just fight for every point.

"It was a surprise how she played. I didn't know her before, but I'm sure that she'll be in the top 50 soon."

Sloane Stephens set up a quarter-final against fellow American Serena Williams when she beat Sweden's Sofia Arvidsson 6-3, 6-4. Ukraine's Lesia Tsurenko, who only came into the tournament when Maria Sharapova pulled out, downed Australia's Jarmila Gajdosova 1-6, 6-1, 6-4.

- AFP/fa

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Wireless trade group CTIA to drop one conference

Wireless trade group
CTIA said today that it will go from two shows a year to a single conference in the fall starting in 2014.

The group, which is primarily focused on the U.S. wireless industry and includes carriers, handset manufacturers, and other related companies, has traditionally held two shows each year: a larger main show in the spring and a smaller, more business-focused event in the fall called MobileCon. The group will continue to hold both events this year.

Pressured by competing trade shows and its own members, CTIA will merge the conferences into a single "super show" in the fall, which it has coined "Super Mobility Week."

"I believe the show will be bigger than the two combined," said Rob Mesirow, show director and vice president of the CTIA.

The main show has long been considered an also-ran event because of its unfortunate scheduling. The CTIA Wireless show comes after the larger Consumer Electronics Show and Mobile World Congress, which often steal away many of the major announcements. The second fall show has always been much smaller in scale and attracted a more limited crowd.

By focusing its efforts on a single fall show, CTIA hopes to provide its members with a platform to make product announcements for the holiday season, Mesirow said in an interview.

"A lot of small events take place in the second half, but there isn't one large event with gravitational pull, and what we found is companies are looking for a place to make product announcements for the holiday season," he said.

Still, even the larger shows are starting to see their own relevance wane as companies opt to hold their own events. Apple has long shunned conferences, and Microsoft has pulled out of
CES. This past spring, Samsung opted to skip CTIA all together, instead holding meetings and presentations in the same city but away from official show grounds. Samsung had announced its Galaxy S III flagship smartphone at its own event a little before CTIA.

Still, CTIA believes the confluence of media, industry observers and executives, and retailers at a single show make for an attractive site for companies that may not have the cachet to pull off their own event.

MobileCon is the name of the fall CTIA show.

(Credit:
Lynn La/CNET)

Mesirow said he believes the 2014 CTIA show will be bigger by including more facets of the mobile industry, including networking companies, machine-to-machine providers, global consumer electronics companies, connected home companies, media companies, and advertising.

"It's a holistic vision of where the wireless industry is moving," he said, noting there would be several "show within a show" areas addressing those different categories, including MobileCon, and new strategic partners. Mesirow wouldn't comment on who those new partners may be.

Mesirow said the trade group has been working on the concept for the last two years, and made the decision this year after polling its members. Many of the larger industry players have complained that the two conferences and the obligation to show up were often a drain on resources.

The CTIA, meanwhile, has added Apple as a board member, and while the company isn't likely to show up at its trade show, the group will have a new "iZone" area focused on the Apple ecosystem.

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House GOP blasted for scrapping Sandy aid vote

WASHINGTON New York area-lawmakers in both parties erupted in anger late Tuesday night after learning the House Republican leadership decided to allow the current term of Congress to end without holding a vote on aid for victims of Superstorm Sandy.

Rep. Peter King, R-N.Y., said he was told by the office of Majority Leader Eric Cantor of Virginia that Speaker John Boehner of Ohio had decided to abandon a vote this session.

Cantor, who sets the House schedule, did not immediately comment. House Democratic Whip Steny Hoyer of Maryland told reporters that just before Tuesday evening's vote on "fiscal cliff" legislation, Cantor told him that he was "99.9 percent confident that this bill would be on the floor, and that's what he wanted."

A spokesman for Boehner, Michael Steel said, "The speaker is committed to getting this bill passed this month."

A House Republican aide confirmed to CBS News producer Jill Jackson that the House would not take up the bill during this session.

In remarks on the House floor, King called the decision "absolutely inexcusable, absolutely indefensible. We cannot just walk away from our responsibilities."

The Senate approved a $60.4 billion measure Friday to help with recovery from the October storm that devastated parts of New York, New Jersey and nearby states. The House Appropriations Committee has drafted a smaller, $27 billion measure, and a vote had been expected before Congress' term ends Thursday at noon.

29 Photos

Cleaning up after Sandy

29 Photos

Superstorm Sandy: State-by-state snapshots

More than $2 billion in federal funds has been spent so far on relief efforts for 11 states and the District of Columbia struck by the storm, one of the worst ever to hit the Northeast. The Federal Emergency Management Agency's disaster relief fund still has about $4.3 billion, enough to pay for recovery efforts into early spring, according to officials. The unspent FEMA money can only be used for emergency services, said Rep. Frank Pallone Jr., D-N.J.

New York, New Jersey, Connecticut, District of Columbia, West Virginia, Virginia, Maryland, New Hampshire, Delaware, Rhode Island, Pennsylvania and Massachusetts are receiving federal aid.

Sandy was blamed for at least 120 deaths and battered coastline areas from North Carolina to Maine. New York, New Jersey and Connecticut were the hardest hit states and suffered high winds, flooding and storm surges. The storm damaged or destroyed more than 72,000 homes and businesses in New Jersey. In New York, 305,000 housing units were damaged or destroyed and more than 265,000 businesses were affected.

"This is an absolute disgrace and the speaker should hang his head in shame," said Rep. Eliot Engel, D-N.Y.

"I'm here tonight saying to myself for the first time that I'm not proud of the decision my team has made," said Rep. Michael Grimm, R-N.Y. "It is the wrong decision, and I' m going to be respectful and ask that the speaker reconsider his decision. Because it's not about politics, it's about human lives."

"I truly feel betrayed this evening," said Rep. Nita Lowey, D-N.Y.

"We need to be there for all those in need now after Hurricane Sandy," said Rep. Gregory Meeks, D-N.Y.

The House Democratic leader, Rep. Nancy Pelosi of California, said she didn't know whether a decision has been made and added, "We cannot leave here doing nothing. That would be a disgrace."

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Obama Hails 'Cliff' Deal, Warns of Next Fiscal Fight

Minutes after the House of Representatives approved a bipartisan Senate deal to avert the "fiscal cliff" and preserve Bush-era tax cuts for all Americans making less than $400,000 per year, President Obama praised party leaders and wasted little time turning to the next fiscal fight.

"This is one step in the broader effort to strengthen our economy for everybody," Obama said.

Obama lamented that earlier attempts at a much larger fiscal deal that would have cut spending and dealt with entitlement reforms failed. He said he hoped future debates would be done with "a little less drama, a little less brinksmanship, and not scare folks quite as much."

But Obama drew a line in the sand on the debt ceiling, which is set to be reached by March.

"While I will negotiate over many things, I will not have another debate with this Congress over whether they should pay the bills for what they've racked up," Obama said. "We can't not pay bills that we've already incurred."

An hour after his remarks, Obama boarded Air Force One to return to his planned Hawaiian holiday vacation, reuniting with his family, who have been vacationing there since just before Christmas.

AP Photo/Charles Dharapak

'Fiscal Cliff' Negotiations: Congress Reaches Agreement Watch Video

House Republicans agreed to the up-or-down vote Tuesday evening, despite earlier talk of trying to amend the Senate bill with more spending cuts before taking a vote. The bill delays for two months tough decisions about automatic spending cuts that were set to kick in Wednesday.

A majority of the Republicans in the GOP-majority House voted against the fiscal cliff deal. About twice as many Democrats voted in favor of the deal compared to Republicans. One hundred fifty-one Republicans joined 16 Democrats to vote against the deal, while 172 Democrats carried the vote along with 85 Republicans.

The Senate passed the same bill by an 89-8 vote in the wee hours of New Year's Day. If House Republicans had tweaked the legislation, there would have been no clear path for its return to the Senate before a new Congress is sworn in Thursday.

The vote split Republican leaders in the House. House Speaker John Boehner, R-Ohio, voted yes, and so did the GOP's 2012 vice presidential candidate, Rep. Paul Ryan, R-Wis.

But House Majority Leader Eric Cantor, R-Va., the No. 2 Republican in the House, voted no. It was his opposition that had made passage of the bill seem unlikely earlier in the day.

The deal does little to address the nation's long-term debt woes and does not entirely solve the problem of the "fiscal cliff."

Indeed, the last-minute compromise -- far short from a so-called grand bargain on deficit reduction -- sets up a new showdown on the same spending cuts in two months amplified by a brewing fight on how to raise the debt ceiling beyond $16.4 trillion. That new fiscal battle has the potential to eclipse the "fiscal cliff" in short order.

"Now the focus turns to spending," said Boehner in a statement after the vote. "The American people re-elected a Republican majority in the House, and we will use it in 2013 to hold the president accountable for the 'balanced' approach he promised, meaning significant spending cuts and reforms to the entitlement programs that are driving our country deeper and deeper into debt."

Republicans hope that allowing the fiscal cliff compromise, which raised taxes without an equal amount of spending cuts, will settle the issue of tax rates for the coming debates on spending.

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Syria starts 2013 with aerial strikes and clashes

BEIRUT (Reuters) - Syrians woke on New Year's Day to countrywide aerial bombardment, while President Bashar al-Assad's forces and rebels fighting to topple him clashed on the outskirts of the capital.

Residents of Damascus entered the new year to the sound of artillery hitting southern and eastern districts that form a rebel-held crescent on the outskirts of the capital, the center of which is still firmly under government control.

In the center, soldiers manning checkpoints fired celebratory gunfire at midnight, causing alarm in a city where streets were largely deserted.

"How can they celebrate? There is no 'Happy New Year'," Moaz al-Shami, an opposition activists who lives in the capital's central Mezzeh district, said over Skype, his voice trembling with anger.

He said rebel fighters attacked one checkpoint in the district of Berzeh early on Tuesday. Opposition groups said mortar bombs hit the southwest suburb of Daraya, where the army launched a military offensive on Monday to retake the battered district.

Assad's air force pounded Damascus's eastern suburbs, as well as rebel-held areas in the second city Aleppo, and several rural towns and villages, opposition activists said.

An estimated 45,000 people have been killed in the revolt, which started in early 2011 with peaceful protests demanding democratic reforms but turned into an armed uprising after months of attacks on protesters by security forces.

A resident of the central city of Homs, who asked to remain anonymous, said shells had landed on the Old City early on Tuesday.

Homs lies on the strategic north-south highway and parts of the ancient city have been leveled during months of clashes. Government forces ousted rebels from the city early last year but militants have slowly crept back in.

"The Old City is under siege. There is shelling from all sides," he said.

The opposition-linked Syrian Observatory for Human Rights, a British-based monitoring group, reported 160 people killed on the final day of 2012, including at least 37 government troops. The group's reports cannot be verified.

BOMBARDMENT

The civil war in Syria has become the longest and deadliest of the conflicts that rose out of the uprisings that swept through the Arab world over the past two years.

Many Sunni Muslims, the majority in Syria, back the rebellion, while Assad, who hails from the Shi'ite-derived Alawite minority sect, is backed by some minorities who fear revenge if he falls. His family has ruled Syria harshly since his father seized power in a coup 42 years ago.

Assad's forces have lately relied more on aerial and artillery bombardment, rather than infantry. Residential areas where rebels base themselves have been targeted, killing civilians unable to flee. Schools and queues of people buying bread have been hit.

Rebels have taken swathes of the north and the east but have struggled to hold cities, complaining that they are defenseless against Assad's Soviet-built air force.

A year ago, many diplomats and analysts predicted Assad would leave power in 2012. But he has proved resilient and none of his inner circle have defected. He still largely retains control of his armed forces.

Diplomatic efforts to end the war have faltered, with the rebels refusing to negotiate unless Assad leaves power and him pledging to fight until death.

Most Western and Arab states have called for him to leave power. He is supported by Russia and Shi'ite Iran.

In the final days of 2012, international mediator Lakhdar Brahimi called on countries to push the sides to talk, saying Syria faced a choice of "hell or the political process".

One Damascus resident, who asked not to be identified for security reasons, said the usual new year's eve crowds were absent from the increasingly isolated capital.

"There was hardly anyone on the streets, no cars, no pedestrians. Most restaurants, cafes and bars were empty," she said. Some young people gathered at three bars in the old city.

"There was music but nobody was dancing. They just sat there with a drink in their hands and smoking. I don't think I saw one person smile," she said. The midnight gunfire caused alarm.

"It was very scary. No one knew what was going on. People got very nervous and started making phone calls. But then I discovered that at least on my street, the gunfire was celebratory."

(Editing by Peter Graff and Alison Williams)

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Surge in demand for pet hotel service during year-end holidays

SINGAPORE: Pet hotels are becoming a hit with owners who want to ensure that their furry friends are in good hands while they are away.

Some hotels said demand went up by about 30 per cent last year, compared with 2011 while occupancy rates are almost always full during the year-end holidays.

From massages to soothe aching joints to customised spa sessions that come with a clay pack wrap of nutrients and minerals, the pets are enjoying a break of their own at pet-wellness centres, such as pet hotel, Petopia, while their owners are away.

Petopia's marketing director Richard Wee said: "They find this place more like a playroom. We have one case of a customer's dog that after they left the hotel and came back for grooming one day, the dog ran all the way back to the playroom to just look for his friends to spend time with during the hotel stay."

Petopia can take in up to 50 animals and rooms are usually booked a few months in advance.

Pet owners fork out between S$75 and S$158 for a night's stay.

"We are looking at three different crowds. The year-end holiday goers, they clear their annual leave. We have families who bring the children overseas during school holidays and a large number of expatriates who return home for the year-end season," said Mr Wee.

Safety and security are the top concerns of owners, along with separation pangs.

Mr Wee said: "We have customers who choose not to go away for many years because they are afraid of not having someone to look after their pets well."

To allay such concerns, the hotel installed webcams in the building for owners to track their pets' movements.

Er Yanshan, a pet owner, said: "It's better than just leaving your pet at home with no one to look after it, so it's a good idea."

What's more alarming is when owners abandon their pets.

The Society for the Prevention of Cruelty to Animals (SPCA) said more than 100 animals were given up at the centre in December 2012 by owners who wanted to go away.

That is twice the number, compared with the other months of the same year.

Mr Lee Yao Huang, who is animal care officer at SPCA, said: "Some of them might decide to give it to SPCA, or they just abandoned it at their HDB area or grass patch near their place.

"We actually give them some help by advising them to put it on our re-homing notice on our SPCA website or they can put up brochures and notices on the vet's clinics or supermarkets on their notice boards."

And for those who don't want to fork out too much at the pet hotel, another way is to get friends or relatives to play pet-sitter.

- CNA/fa

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Why I still love the Nexus 7

There's something about the holidays and the cold January that often follows in the Northeast that makes me want to curl up on the couch with a good book -- or in this day and age, a book on my e-reader or
tablet.

The
Nexus 7 debuted more than six months ago at Google's annual developer conference, but I am still a big fan of the device. And I have no trouble recommending it to tablet buyers.

In this edition of Ask Maggie, I explain why the Nexus 7 is still a good device at a decent price. One Ask Maggie reader is tired of squinting to read books on his smartphone, but he's troubled by the $200 price tag. Meanwhile, the second reader is debating whether to get the smaller 7-inch Nexus 7 mini-tablet or a bigger
Android tablet from Samsung.

Nexus 7 or e-reader?

Dear Maggie,
I am debating whether I should get the Nexus 7 or not. The primary reason is the fact that I read books from the Google Play Store on my Razr Maxx right now and would love to have a larger screen that is portable. But at this point I have managed to read on the smaller screen, and I'm not sure spending $200 for a bigger screen makes sense. I've looked at e-readers, but if I am going to spend any money on a new device, I'd like to have the ability to do other things in addition to reading books. It would be great to be able to read email, play games, watch movies, etc.

I don't like using my computer for Web browsing and reading, but my smartphone seems too small. Do you think I should spend the $200 to get another device like the Nexus 7?

Based on your experiences, what would you recommend?

Thanks,
MagicWithMeaning

Dear MagicWithMeaning,
I hear you. I also think that a smartphone is too small for reading, although I know some people who don't mind it. My colleague Stephen Shankland read the entire Steve Jobs biography on his smartphone in a single night and wrote an amazing review of the book when it came out. I am afraid if I had attempted the same thing, I would have gone blind. And I probably would have only gotten through a quarter of the book in a night.

There's an array of options when it comes to choosing a device for reading e-books.

(Credit:
Sarah Tew/CNET)

At any rate, as I said, some people really don't mind the smaller size of a smartphone. And since you can magnify the text, it's certainly doable. But it sounds like you don't find this situation ideal. And I'm with you.

I think the Nexus 7 is a terrific step up, and I highly recommend it to readers. It's very light, and the size is perfect. It's about the size of a typical paperback book and can easily be held with one hand. It fits nicely into a pocket or purse, so it's portable if you read while commuting or traveling.

And since it comes with the full Android OS, you can access just about anything from the Google Play store. I mention this because other tablets of a similar size, such as the Kindle Fire, offer only a limited catalog of books, games, and movies. Whatever is available via Amazon is what's available on the Kindle Fire. This is great if you are already using that ecosystem to purchase your books and other media. But it sounds like you are already getting books and other stuff via the Google Play store, so it makes sense for you to continue using that ecosystem.

I know the $200 price tag isn't cheap. But it's a good deal considering how much other gadgets cost. Even full-priced smartphones are $400 to $500 more than the Wi-Fi only Nexus 7 tablet.

If you're looking to do more with your device, then the mini-tablet is a good pick over something like a dedicated e-reader. But the one thing I like about e-readers is the e-ink display. I think that display is a bit easier on my eyes, and I can sit and read a book for much longer than if I am using a device like the Nexus 7, which has a backlit screen.

But that is just my personal preference. I know plenty of people who don't have a problem with backlit screens. And in fact, it makes it easier to read in the dark, something that can't be done with an e-ink device.

I agree that if you're looking for the most bang for your buck, you might as well get a tablet that will give you a full browser and access to entire an app store instead of a limited-use e-reader.

Samsung Galaxy Note 2

(Credit:
Josh Miller/CNET)

But there is one option that you didn't mention in your question. What about getting a "phablet?" If you are able to upgrade to a new smartphone soon you may want to consider something like the Galaxy Note 2. With a 5.5-inch display, it's between the size of most Android smartphones and the 7-inch Nexus 7 tablet. It costs about $300 from carriers such as AT&T with a two-year contract. This is more than other smartphones such as the Galaxy S3. And it's more than the Nexus 7. But if you did need a new smartphone and you didn't want to buy a separate device, it might be a good compromise.

If a new smartphone isn't in the cards for you right now and you really are teetering on the edge of whether to buy the Nexus 7 or not, I'd say go for it. I know that $200 is nothing to sneeze at for many people. But when compared to larger tablets and full-priced smartphones, it's a bargain.

If you are strapped for cash, you could always wait a little longer to see if Google announces a cheaper version of the device. There are some reports from Asia that Google may be readying a $99 mini-tablet.

I hope this advice was helpful. And good luck!

Nexus 7 vs. Galaxy Tab 2 10.1

Dear Maggie,
I'm getting my first Android tablet, but I'm on a strict budget. I have wanted the Nexus 7 for a while, but found a great deal ($270) for a refurbished Samsung Galaxy Tab 2 10.1. Which is better?

Thanks,
TEP

Dear TEP,
The answer to your question really depends on which screen size you like better. The Galaxy Tab 2 has a bigger 10-inch screen, while the Nexus 7 has the smaller 7-inch screen. Personally, I prefer the smaller screen to the bigger one. The smaller tablets are easier to stick in a pocket, bag, or purse. And you can hold it with one hand. I use the Nexus 7 for reading, and I find that it's fairly light and easy to hold with one hand.

Samsung Galaxy Tab 2 10.1

(Credit:
Samsung)

That said, the Galaxy Tab 2 10.1 is a fine device. And it has gotten decent marks from CNET and other tech reviewers. If you like that size device and you want an Android tablet, then that is a good device to consider. And the price certainly sounds right.

But if the size is really a toss-up, and you could go either way, then I would still choose the Nexus 7. CNET rated it as one of the best Android tablets on the market. And at $200 brand new, it's still $70 less than the refurbished Galaxy Tab 2 that you have found.

I hope this advice was helpful. Good luck. And Happy New Year!

Ask Maggie is an advice column that answers readers' wireless and broadband questions. The column now appears twice a week on CNET, offering readers a double dosage of Ask Maggie's advice. If you have a question, I'd love to hear from you. Please send me an e-mail at maggie dot reardon at cbs dot com. And please put "Ask Maggie" in the subject header. You can also follow me on Facebook on my Ask Maggie page.

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Senate Approves 'Fiscal Cliff' Deal, Sends to House

Two hours after a midnight deadline for action, the Senate passed legislation early New Year's Day to avert the so-called "fiscal cliff" with an overwhelming vote of 89-8.

Senate passage set the stage for a final showdown in the House, where a vote could come as early as today.

"While neither Democrats nor Republicans got everything they wanted, this agreement is the right thing to do for our country and the House should pass it without delay," President Obama said in a statement shortly after the vote.

"There's more work to do to reduce our deficits, and I'm willing to do it. But tonight's agreement ensures that, going forward, we will continue to reduce the deficit through a combination of new spending cuts and new revenues from the wealthiest Americans," he added.

The bill extends Bush-era tax cuts permanently for people making less than $400,000 per year and households making less than $450,000.

The steep "sequester" budget cuts scheduled to go into effect with the New Year would be postponed for two months.

The deal also would affect taxes on investment income and estates, and extend unemployment benefits for a year.
Officials also decided at the last minute to use the measure to prevent a $900 pay raise for lawmakers due to take effect this spring.

'Fiscal Cliff': Lawmakers Scramble for Last-Minute Deal Watch Video

The failure of a deal to pass Congress by Jan. 1 technically triggers an income tax hike on all Americans and automatic spending cuts, though lawmakers could still prevent a tax hike by making retroactive any legislation that passes in the weeks ahead, experts said.

The deal at hand will not entirely solve the problem of the "fiscal cliff," however. In fact, it could set up a new showdown over the same spending cuts in just two months that would be amplified by a brewing fight over how to raise the debt ceiling beyond $16.4 trillion. That new fiscal battle has the potential to eclipse the "fiscal cliff" in short order.

In addition to extending current tax rates for households making $450,000 or less, the latest plan would raise the estate tax from 35 to 40 percent for estates larger than $5 million; and prevent the alternative minimum tax from hammering millions of middle-class workers.

Capital gains taxes would rise to 20 percent from 15 percent.

The deal would also extend for one year unemployment insurance benefits set to expire today for two million people, and avert a steep cut to Medicare payments for doctors.

"Working though the night and throughout the day we've reached an agreement with Sen. McConnell," Senate Majority Leader Harry Reid, D-Nev., said early Tuesday morning prior to the vote.

"I've said all along our most important priority is protecting middle class Americans, this legislation does that," Reid added.

He said he is "disappointed" they were not able to make the grand bargain and that more work needs to be done in the future.

"But we tried, if we did nothing the threat of a recession is very real," Reid concluded.

Speaking after Reid, Senate Minority Leader Mitch McConnell, R-KY., called the deal an "imperfect solution" and noted this should not be the model on how things get done in the Senate.

McConnell also thanked Vice President Joe Biden, who visited Capitol Hill late Monday night and brokered the deal with McConnell.

The House Democratic leader Nancy Pelosi issued a statement saying that when legislation clears the Senate, "I will present it to the House Democratic caucus."

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Assad's forces push to retake Damascus suburb

AMMAN (Reuters) - Heavy fighting raged on the outskirts of Damascus on Monday as elite troops backed by tanks tried to recapture a strategic suburb from rebels in one of the largest military operations in that district in months, opposition activists said.

Five people, including one child, died from army rocket fire that hit Daraya, the activists said. Daraya is one of a series of interconnected Sunni Muslim suburbs that ring Syria's capital and have been at the forefront of the 21-month-old revolt against President Bashar al-Assad.

"This is the biggest attack on Daraya in two months. An armored column is trying to advance but it being held (back) by the Free Syrian Army," said Abu Kinan, an opposition activist in the area, referring to a rebel group.

He said that tens of thousands of civilians had fled Daraya during weeks of government assault but that 5,000 remained, along with hundreds of rebels. Daraya is located near the main southern highway leading to the Jordanian border 85 kms (50 miles) to the south.

Activists said the military is trying to push back rebels who have been slowly advancing from the outskirts of Damascus to within striking distance of central districts inhabited by Assad's Alawite minority sect.

Assad's forces have mostly relied on aerial and artillery bombardment, rather than infantry. Rebels have been able take several outlying towns and have clashed with government troops near Damascus International Airport, halting flights by foreign airlines.

Another activist in Damascus with connection to rebels, who did not want to be named, said Daraya has been a firing position for rebels using mortars and homemade rockets. From it, they have been able to hit a huge presidential complex located at a hilltop overlooking Damascus and target pro-Assad shabbiha militia in an Alawite enclave nearby known as Mezze 86.

"So far they have missed the palace but they are getting better. I think the regime has realized that it no longer can afford to have such a threat so close by, but it has failed to overrun Daraya before," he said.

(Reporting by Khaled Yacoub Oweis; Editing by Oliver Holmes and Peter Graff)

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