The Press Democrat from Santa Rosa, California • 30

TNI PRESS DEMOCRAT, TUESDAY, JANUARY 1 1 SSO U.S. chip consortium! closes shop Group couldn't get new investors Elderly do their share of tax-shelter abuse "We did achieve some significant things In the process," Kane sala. "We showed that with some creativity and support and teamwork we could come up with a solution within the American framework. We clearly increased the Impact of the semiconductor Industry and DRAMs in particular." Spokesmen for Intel and Advanced Micro Devices had told the San Francisco Chronicle they still supported the plan. "It looks like the end," said TJ.

Rodgers, chief executive of San Jose-based Cypress Semiconductor, a critic of the consortium plan. Logic. The New York Times and Washington Post had quoted unidentified Industry sources Indicating the venture was to announce Its demise. The consortium was planned to challenge Japanese leadership in Uie making of computer memory chips called DRAMs, or dynamic random access memories, often compared to crude oil In their importance to Industry. Despite the announcement, Kane said the venture had produced some positive results.

pens today does not bode well for an Industry that has made a technical decision rather than a tactical one." Kane told reporters that the Joint venture will be terminated, largely because of a lack of support from the electronics Industry. The venture had not found a new Investor since its formation last June by seven big-name backers International Business Machines Digital Equipment Hewlett-Packard Intel Advanced Micro Devices National Semiconductor Corp. and LSI! IN BRIEF BDDSDCIISSg National Academy of Elder Law Attorneys (NAELA) has jumped to 450, up from a mere 88 a year ago. Strategies vary, and are adapted to each state's Medicaid rules. But here are some of the loopholes the elderly use: They convert all their ready savings into home equities, by building a room on the house or paying off the mortgage.

Under the Medicaid rules, all your cash and securities have to go toward your nursing-home bills. But the money locked up in home equities can't be touched They give the house to their spouse. The spouse then wills (or gives) it to the children or another beneficiary. Houses never have to be sold to cover nursing-home expenses, so long as a spouse or certain other relatives live there. If those relatives die, and home-ownership has been passed to someone else, the nursing home can never tap it to pay the bills.

They transfer other assets to children a widely touted strategy that's now in trouble. Normally, if you give away a lot of money, then apply for Medicaid within 30 months, you're temporarily Ineligible for public assistance. Many of the elderly have been dodging this rule, by giving assets to a spouse who in turn gives them to, say, the children. When the issue was tax-shelter abuse, there was no shortage of angry citizens shaking a. fists.

It was shockingly unfair to see people with money ducking out on their share of the nation's fiscal burden. But where are those fist-shakers now, when a similar and even most costly abuse is draining away taxpayer funds? It, too, is a fairness issue. It, too, helps people with money at the expense of those without. In this case, however, the monied perpetrators are the elderly. Have senior citizens become such sacred cows that the public and the politicians are too cowed to shake even a finger? The issue is custodial nursing homes, and who should pay the expenses of the people who live there.

trrihe law Is quite clear. The I I bills are the elderly's responsibility, for as long as their money lasts. When seniors live at home, they pay for their own food and shelter, the same Is true when they move to a nursing home. The public doesn't suddenly take on a duty of support But nursing homes are expensive $25,000 a year or more. Seniors' savings are often used up within the year.

At that point, the public does indeed step in. The residents' bills are assumed by Medicaid, which is financed by state and federal tax dollars. To me, this sounds fair. But thousands of older people resent the arrangement. They'd rather preserve their own money for their heirs apparent They want full support from the taxpayer from the very first day they enter the home.

So, just as the tax-shelter junkies hid their income, many of the elderly deliberately dispose of their estates. When they enter a nursing home, their pockets are empty. Pleading poverty, they promptly apply for public assistance. In this endeavor, they're counseled by an army of "poverty makers" in law firms, accounting firms, legal-aid offices, social-service centers and nursing homes. Membership in the two-year-old IVorst on-time arrival record for USAir WASHINGTON In the three months following its merger with Piedmont Aviation, USAir has chalked up the worst on-time performance of any major carrier in the Industry.

But executives of the Arlington, carrier say the problem a result of bad weather and difficulties knitting the two airlines together should begin to abate. In September, October and November, USAir ranked last among major airlines in on-time performance. In November, 4.8 percent of the carrier's flights a total of 142 arrived late more than 70 percent of the time, and only 68.4 percent of its flights arrived within 15 minutes of their scheduled arrival time, according to Transportation Department figures. American hikes fares American Airlines, the nation's largest carrier, said Monday it is again raising air fares to cover the high cost of jet fuel. The airline plans to increase by 10 percent selected one-way discount fares often used by business travelers, spokeswoman Mary O'Neill said from Fort Worth, Texas.

In addition, fares in that category that don't require advance purchase will now have to be bought three days in advance. The changes are effective Feb. 1. Rival United Airlines, the second-biggest carrier, is studying American's 10 percent fare increase, United spokeswoman Sara Dornackersaid. It wasn't immediately clear whether other airlines would match the increases.

Hew Ucgas resort LAS VEGAS Thousands of people swarmed through the new $85 million Rio Hotel and Casino on Monday as the resort west of the Las Vegas Strip became the latest addition to the city's growing hotel inventory. Rio President Bob Maxey said the new hotel was a testament to the growth of Las Vegas and the faith its owners have in the city's future. He said doomsayers told the builders of the 430-room Rio to go slow because of the opening of the Mirage Hotel In November and the scheduled opening later this year of the Excalibur. Lower income for Chase, First Chicago Chase Manhattan Corp. said Monday that its profit fell 36 percent in the final quarter of 1989 compared with the previous year, while another large banking company, First Chicago reported an 11 percent drop in quarterly net income.

Results for all of last year also were depressed from 1988 levels, reflecting in part moves to reduce exposure to shaky Third World debt. Chase said it earned $175 million, or $1.47 per share, in the three months ended Dec. 31. That compared with earnings of $275 million, or $2.93 a share, in the 1988 period. Coors goes non-alcoholic GOLDEN, Colo.

For the first time since Prohibition, a division of Adolph Coors Co. is selling a non-alcoholic beverage, a new product called Coors Rocky Mountain Sparkling Water, company officials said Monday. The product goes on sale this week in Colorado, Arizona and Northern California cities, mostly in the Bay Area, Coors spokesman Heidi Buehler Nogues said. "Bottled water is the fastest-growing beverage category in America," John Recca, brand development manager, said In a news release. "The timing is right for us to take advantage of our legendary water source." The product is made by Coors Brewing which is a business unit of the Golden-based Adolph Coors Co.

Press Democrat news services. I ut Congress appears to I have closed this loophole, I warns Indianapolis attorney and NAELA president Scott Severns. In fact, if the at-home spouse transfers any assets at all, the Medicaid spouse may now lose coverage. Formerly, the at-home spouse of a nursing-home resident might have been left in poverty, because of high nursing-home expenses. That justified some of the money games that were being played.

But brand-new rules allow the at-home spouse to keep much more money. Still, many seniors are beating down the doors of the "poverty they won't have to pay the bills themselves. Jane Bryant Quinn's column is distributed by the Washington Post Writers Group and appears Tuesdays and Thursdays in The Press Democrat. Auoclatcd Pr SANTA CLARA A U.S. venture designed to regain control of the vital computer chip industry from Japanese dominance is being folded because it failed to attract Investors, officials announced Monday.

U.S. Memories Inc. was hailed as a II billion cooperative venture by American companies, but In its seven brief months of life, It failed to make a single computer chip or earn a single dollar. "I am extremely disappointed by these turn of events," said Sanford Kane, president of U.S. Memories, at a news conference at Santa Clara headquarters.

"What hap- Merrill Lynch cuts 3,000 jobs Associated Press NEW YORK Merrill Lynch Co. will cut about 3,000 jobs In 1990 that will include another round of layoffs at the nation's largest brokerage, officials said Monday. Merrill spokesman Fred Yager said reductions would be spread throughout the year and occur through layoffs, attrition and selling off businesses. The firm announced plans for across-the-board trimming in November. The cuts should reduce Merrill's total work force to about 36,800, compared with 40,500 at the end of 1989 and a peak of 47,000 shortly before the October 1987 stock market crash.

"What we've seen is just a continuation of the staff reductions all over Wall Street," said John Keefe, a securities industry analyst with Drexel Burnham Lambert Inc. "Merrill is a big place. In terms of numbers they have the biggest potential for cuts." Yager said the firm had no target for the size reductions. But a Merrill official speaking on condition of anonymity said the reductions would total about 3,000, including as many as 1,000 layoffs. "We are going through a selective process and there will be selective layoffs as we go along," Yager said.

Merrill reduced about 700 positions earlier this month by selling its Canadian retail brokerage operation and eliminated 300 more jobs through cuts in its Broadcort Capital Corp. account-clearing business. Since November, Merrill also has abandoned the European commercial paper business, eliminated one equity division at its New York headquarters and reduced trading of British stocks. IQUU HOUSJG LENDER SANTA ROSA SOLARIUMS Distinctive Sunspaces Quality Service Sunrooms Spa Enclosures Greenhouse Atriums Call Marc Durand 527-5330 to HIGH Xyield LEARN WAYS TO AVOID FliTOlAL DJ8ASIBI ATTEND THIS FINANCIAL MANAGEMENT WORKSHOP Topics include: i How to invest in the 90's. How to get an $8,250 tax credit.

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