The US economy is expected to contract 2.2 percent in 2009 before recovering in 2010 to grow 1.5 percent, the Congressional Budget Office said in new forecasts released Wednesday. Meanwhile, congressional forecasters announced that the US budget deficit would swell to a record $1.186 trillion in FY 2009.

Alcoa Inc. plans to eliminate 13,500 jobs, or 13 percent of its global workforce, in an effort to slash costs, the world's third-largest aluminum maker announced Tuesday at its Pittsburgh headquarters. Citing sharply lower aluminum prices and weaker demand, the company also said it would make deep production cuts, as well as impose a salary and hiring freeze.

Jeb Bush, Florida's governor from 1999 to 2007, said Tuesday he has decided not to run for the US Senate seat that fellow Republican Mel Martinez will relinquish upon retiring in 2010. A popular figure in the state, Bush said he expects to play a role in helping the GOP "to reshape" its message.

Gov. Arnold Schwarzenegger (R) of California, who has warned of a "financial Armageddon" if the state doesn't address its worsening budget deficit, vetoed an $18 billion deficit-cutting package Tuesday passed by the Democratic-controlled Legislature. The package, approved in a third special legislative session since November, didn't go far enough in streamlining government, a spokesman for the governor said.

Five former Blackwater Worldwide security guards, all decorated military veterans, pleaded not guilty in federal court in Washington Tuesday to manslaughter charges. The men are implicated in a 2007 shooting in a crowded Baghdad square that killed 17 Iraqi civilians and injured dozens of others.

For the first time since 1981, all the living presidents gathered at the White House Wednesday at the invitation of President Bush, who invited Bill Clinton, George H.W. Bush, and Jimmy Carter, as well as President-elect Obama, for lunch.

The Sierra Club notified The Tennessee Valley Authority Tuesday that it plans to sue the nation's largest government-run utility on behalf of 40 families affected by the Dec. 22 collapse of a coal ash pond.

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