Changing of the Guard: Facing Protests, China’s Business Investment May Be Cooling

SHIFANG, China — Local leaders were all smiles this summer at a groundbreaking ceremony for a vast copper smelting project that seemed like the answer to the chronic unemployment that has plagued this city in northern Sichuan ever since a devastating earthquake in 2008.

Reuters

A protest against plans to expand a petrochemical plant in Ningbo, China, last month. More investment projects are running into opposition from a growing Chinese middle class concerned about environmental damage.

Articles in this series are examining the implications for China and the rest of the world of the coming changes in the leadership of the Chinese Communist Party.

But within days, the tree-lined plaza at the heart of the city was packed with thousands of youths, protesting that the $1.6 billion factory would pose a pollution hazard. After two nights of street battles pitting youths against the riot police, city leaders canceled the smelter.

“The environment is more important” than new investments or jobs, said a young woman sitting on a recent afternoon at the cafe across the street from the plaza, now empty except for a clutch of retirees gathered under the clock tower.

China’s economic boom over the last three decades has depended overwhelmingly on a build-at-all-costs investment strategy in which pollution concerns, the preservation of neighborhoods and other such questions have been swept aside. But that approach is starting to backfire, posing one of the biggest challenges for the new generation of Chinese policy makers who will take over at the Communist Party Congress, which starts on Thursday.

New investment projects used to be seen as the best way to keep the Chinese public happy with jobs and rising incomes, assuring social stability — a paramount goal of the Communist Party — while frequently enriching local politicians as well.

But from Shifang in the west to the port of Ningbo in the east, where a week of sometimes violent protests forced the suspension on Oct. 28 of plans to expand a chemical plant, more projects are running into public hostility.

In many cases, they are running into opposition not just from farmers who do not want their houses and fields confiscated, but also from a growing middle class fearful that new factories will lead to more environmental damage.

In response to this and other worries about the economy, a number of influential officials and business leaders in China have stepped up their calls for changes aimed at increasing the efficiency of investment and simultaneously shifting the country toward a greater reliance on consumption.

But China’s leaders, including the outgoing prime minister, Wen Jiabao, have been talking about such a transformation for years with little sign of success, as state-controlled banks continue to lend huge sums to politically powerful state-owned enterprises and local governments.

Frenzied construction of roads, bridges, tunnels and rail lines over the last decade has left China with world-class infrastructure. But it has also produced deeply indebted local governments that are struggling to finance more projects.

At the same time, vast unused capacity in practically every industrial sector has crippled profitability and left manufacturing companies straining to repay their borrowings, a problem that has been partly masked by banks in the habit of simply rolling over loans rather than recognizing losses.

“All Chinese industries are like that — can you dig out which area of Chinese industry is not in overcapacity?” said Li Junfeng, a longtime director general for energy at China’s top economic planning agency.

Investment reached 46 percent of China’s economic output last year. By comparison, Japan’s investment rate peaked at 36 percent, which it reached in the early 1970s; South Korea topped out at 39 percent in the late 1980s.

Growth in Japan and South Korea started to slow and eventually tumbled after investment peaked. The big question now is when China will run into the same limits, and how rapidly change will take place, said Diana Choyleva, an economist at Lombard Street Research in Hong Kong. “The potential for a big crisis is always there,” she said.

Even experts who strongly favor fundamental policy changes, like moving to a more market-oriented system for allocating bank loans and setting interest rates, doubt that China’s leaders are preparing to move quickly. Conversations at senior levels of the Communist Party appear to have focused so far on reducing the state’s role in the day-to-day management of many state-owned enterprises rather than selling them or breaking them up.

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Judge Temporarily Blocks Mandate on Birth Control

WASHINGTON — A federal judge has issued an order shielding a Michigan business from a requirement of the new health care law to provide insurance coverage for contraceptives at no charge to female employees.

The judge, Robert H. Cleland of the Federal District Court in Detroit, said last week that the requirement could infringe on “the sincere exercise of religious beliefs” by the owner of the company. He agreed to issue a preliminary injunction to stop the government from enforcing the requirement against two of the plaintiffs, Daniel Weingartz and his family-owned business, Weingartz Supply Co., in Utica, Mich.

Mr. Weingartz, a Roman Catholic, said he had devised a health plan that, in keeping with his religious beliefs, excluded coverage of contraceptives.

His business, a secular for-profit company, sells outdoor power equipment and employs about 170 people.

Judge Cleland is the second judge to issue such an order. In July, a federal district judge in Colorado issued a preliminary injunction blocking enforcement of the contraceptive mandate against Hercules Industries, a maker of heating, ventilation and air-conditioning equipment.

In September, a federal district judge in St. Louis rejected a similar challenge. The judge, Carol E. Jackson, said that the plaintiffs, a Missouri company and its owner, “remain free to exercise their religion, by not using contraceptives and by discouraging employees from using contraceptives.”

Individuals, businesses, hospitals, schools and universities have filed more than three dozen lawsuits challenging the requirement for employers and health plans to cover contraceptives.

Many plaintiffs, like Mr. Weingartz and Hercules, have invoked the First Amendment and the Religious Freedom Restoration Act of 1993. That law provides that officials may not burden a person’s exercise of religion unless they can show “a compelling governmental interest” and use “the least restrictive means” of advancing that interest.

The Obama administration said it had two compelling reasons for the contraceptive mandate: promoting public health and “gender equality.” It quoted Senator Dianne Feinstein, Democrat of California, who said in Senate debate on the legislation: “Women have different health needs than men, and these needs often generate additional costs. Women of childbearing age spend 68 percent more in out-of-pocket health care costs than men.”

Moreover, the Obama administration said, providing a religious exemption to companies like Weingartz Supply and Hercules would allow the owners of secular businesses to impose their religious beliefs on their employees, many of whom may not share the owners’ convictions.

Mr. Weingartz should not be allowed to “impose his religious beliefs on the corporation’s group health plan or its 170 employees,” the Justice Department said in court documents.

Mitt Romney, the Republican presidential nominee, has assailed the contraceptive coverage requirement as a threat to religious liberty. If elected, he has said, he will work to abolish it, along with the rest of President Obama’s health care overhaul.

The new health care law generally requires employers to provide women with coverage at no cost for “preventive care and screenings.”

Under this provision, the administration says, employers must cover sterilization and the full range of contraceptive methods approved by the Food and Drug Administration, including emergency contraceptive pills, like those known as ella and Plan B One-Step. Employers who do not provide such coverage will be subject to financial penalties, starting in 2014.

The administration has agreed to exempt “religious employers” if they meet several criteria: their purpose is to inculcate religious values, they primarily employ and serve people who share their religious tenets and they are recognized as nonprofit organizations under federal tax law.

Judge Cleland decided, in effect, to freeze the current situation while he weighs competing claims by the Obama administration and Weingartz Supply.

“Neither plaintiffs nor the government have shown a strong likelihood of success on the merits,” Judge Cleland wrote.

But in issuing a preliminary injunction, he said he was guided by rulings of the Supreme Court, which has held, “The loss of First Amendment freedoms, for even minimal periods of time, unquestionably constitutes irreparable injury.”

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Judge Temporarily Blocks Mandate on Birth Control

WASHINGTON — A federal judge has issued an order shielding a Michigan business from a requirement of the new health care law to provide insurance coverage for contraceptives at no charge to female employees.

The judge, Robert H. Cleland of the Federal District Court in Detroit, said last week that the requirement could infringe on “the sincere exercise of religious beliefs” by the owner of the company. He agreed to issue a preliminary injunction to stop the government from enforcing the requirement against two of the plaintiffs, Daniel Weingartz and his family-owned business, Weingartz Supply Co., in Utica, Mich.

Mr. Weingartz, a Roman Catholic, said he had devised a health plan that, in keeping with his religious beliefs, excluded coverage of contraceptives.

His business, a secular for-profit company, sells outdoor power equipment and employs about 170 people.

Judge Cleland is the second judge to issue such an order. In July, a federal district judge in Colorado issued a preliminary injunction blocking enforcement of the contraceptive mandate against Hercules Industries, a maker of heating, ventilation and air-conditioning equipment.

In September, a federal district judge in St. Louis rejected a similar challenge. The judge, Carol E. Jackson, said that the plaintiffs, a Missouri company and its owner, “remain free to exercise their religion, by not using contraceptives and by discouraging employees from using contraceptives.”

Individuals, businesses, hospitals, schools and universities have filed more than three dozen lawsuits challenging the requirement for employers and health plans to cover contraceptives.

Many plaintiffs, like Mr. Weingartz and Hercules, have invoked the First Amendment and the Religious Freedom Restoration Act of 1993. That law provides that officials may not burden a person’s exercise of religion unless they can show “a compelling governmental interest” and use “the least restrictive means” of advancing that interest.

The Obama administration said it had two compelling reasons for the contraceptive mandate: promoting public health and “gender equality.” It quoted Senator Dianne Feinstein, Democrat of California, who said in Senate debate on the legislation: “Women have different health needs than men, and these needs often generate additional costs. Women of childbearing age spend 68 percent more in out-of-pocket health care costs than men.”

Moreover, the Obama administration said, providing a religious exemption to companies like Weingartz Supply and Hercules would allow the owners of secular businesses to impose their religious beliefs on their employees, many of whom may not share the owners’ convictions.

Mr. Weingartz should not be allowed to “impose his religious beliefs on the corporation’s group health plan or its 170 employees,” the Justice Department said in court documents.

Mitt Romney, the Republican presidential nominee, has assailed the contraceptive coverage requirement as a threat to religious liberty. If elected, he has said, he will work to abolish it, along with the rest of President Obama’s health care overhaul.

The new health care law generally requires employers to provide women with coverage at no cost for “preventive care and screenings.”

Under this provision, the administration says, employers must cover sterilization and the full range of contraceptive methods approved by the Food and Drug Administration, including emergency contraceptive pills, like those known as ella and Plan B One-Step. Employers who do not provide such coverage will be subject to financial penalties, starting in 2014.

The administration has agreed to exempt “religious employers” if they meet several criteria: their purpose is to inculcate religious values, they primarily employ and serve people who share their religious tenets and they are recognized as nonprofit organizations under federal tax law.

Judge Cleland decided, in effect, to freeze the current situation while he weighs competing claims by the Obama administration and Weingartz Supply.

“Neither plaintiffs nor the government have shown a strong likelihood of success on the merits,” Judge Cleland wrote.

But in issuing a preliminary injunction, he said he was guided by rulings of the Supreme Court, which has held, “The loss of First Amendment freedoms, for even minimal periods of time, unquestionably constitutes irreparable injury.”

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Silicon Valley Objects to Online Privacy Rule Proposals for Children

Washington is pushing Silicon Valley on children’s privacy, and Silicon Valley is pushing back.

Daniel Rosenbaum for The New York Times

Phyllis H. Marcus, a lawyer for the F.T.C., is leading a team that is updating a privacy rule to require more parental consent.

Apple, Facebook, Google, Microsoft and Twitter have all objected to portions of a federal effort to strengthen online privacy protections for children. In addition, media giants like Viacom and Disney, cable operators, marketing associations, technology groups and a trade group representing toy makers are arguing that the Federal Trade Commission’s proposed rule changes seem so onerous that, rather than enhance online protections for children, they threaten to deter companies from offering children’s Web sites and services altogether.

“If adopted, the effect of these new rules would be to slow the deployment of applications that provide tremendous benefits to children, and to slow the economic growth and job creation generated by the app economy,” Catherine A. Novelli, vice president of worldwide government affairs at Apple, wrote in comments to the agency.

But the underlying concern, for both the industry and regulators, is not so much about online products for children themselves. It is about the data collection and data mining mechanisms that facilitate digital marketing on apps and Web sites for children — and a debate over whether these practices could put children at greater risk.

In 1998, Congress passed the Children’s Online Privacy Protection Act in an effort to give parents control over the collection and dissemination of private information about their children online. The regulation, known as Coppa, requires Web site operators to obtain a parent’s consent before collecting personal details, like home addresses or e-mail addresses, from children under 13.

Now, federal regulators are preparing to update that rule, arguing that it has not kept pace with advances like online behavioral advertising, a practice that uses data mining to tailor ads to people’s online behavior. The F.T.C. wants to expand the types of data whose collection requires prior parental permission to include persistent ID systems, like unique device codes or customer code numbers stored in cookies, if those codes are used to track children online for advertising purposes.

The idea is to preclude companies from compiling dossiers on the online activities — and by extension the health, socioeconomic status, race or romantic concerns — of individual children across the Web over time.

“What children post online or search as part of their homework should not haunt them as they apply to colleges or for jobs,” Representative Edward J. Markey, Democrat of Massachusetts and co-chairman of the Bipartisan Congressional Privacy Caucus, said in a recent phone interview. “YouTube should not be turned into YouTracked.”

The agency’s proposals have provoked an intense reaction from some major online operators, television networks, social networks, app platforms and advertising trade groups. Some argue that the F.T.C. has overstepped its mandate in proposing to greatly expand the rule’s scope.

Others say that using ID systems like customer code numbers to track children “anonymously” online is benign — and that collecting information about children’s online activities is necessary to deliver the ads that finance free content and services for children.

“What is the harm we are trying to prevent here?” said Alan L. Friel, chairman of the media and technology practice at the law firm Edwards Wildman Palmer. “We risk losing a lot of the really good educational and entertaining content if we make things too difficult for people to operate the sites or generate revenue from the sites.”

The economic issue at stake is much bigger than just the narrow children’s audience. If the F.T.C. were to include customer code numbers among the information that requires a parent’s consent, industry analysts say, it might someday require companies to get similar consent for a practice that represents the backbone of digital marketing and advertising — using such code numbers to track the online activities of adults.

“Once you’ve said it’s personal information for children that requires consent, you’ve set the framework for a requirement of consent to be applied to another population,” Mr. Friel said. “If it is personal information for someone that’s 12, it doesn’t cease being personal information when they are 13.”

Indeed, many of the F.T.C.’s proposed rule revisions have vocal detractors.

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Hearing Begins for Robert Bales, Accused in Afghan Murders

JOINT BASE LEWIS-McCHORD, Wash. — A military prosecutor on Monday laid out a chillingly flat recitation of the government’s case against Staff Sgt. Robert Bales, the Army officer who is accused of murdering 16 civilians this year in Afghanistan, as a pretrial hearing began in one of the nation’s worst war crimes cases in decades.

“He was lucid, coherent and responsive,” Lt. Col. Joseph Morse, the Army prosecutor, told the court in describing Sergeant Bales’s demeanor on arriving back at an Army post in Kandahar Province with blood on his clothes that, the prosecutor said, had seeped all the way through to the sergeant’s underwear.

Local families in a poor area with no electricity, Colonel Morse said, awoke early on March 11 to find a figure cloaked in darkness inside their homes, firing a weapon with apparent intent to kill. Children were shot through the thighs or in the head, he said. In one place, 11 bodies — mostly women and children, the prosecutor said — were “put in a pile and put on fire.”

Sergeant Bales, 39, an 11-year-military veteran, could face the death penalty if found guilty of the most serious charges, and the decision is specifically made to advance the case as a capital crime.

The hearing that began Monday, here at the base where Sergeant Bales was stationed, about an hour south of Seattle, was the first step in the military justice process. An Article 32 Investigation, as it is called, is roughly the equivalent of a grand jury inquiry in civilian law, aimed at determining whether sufficient evidence exists to continue to a full court-martial.

At least 35 witnesses are expected to testify, some through live video uplink from Afghanistan, over the investigation, which could last two weeks or more. The presiding officer, Col. Lee Deneke, will then make his recommendation to superiors as to the next steps, including the question of whether the death penalty should be considered, as the prosecution has requested.

Sergeant Bales’s defense lawyers on Monday reserved their opening comment for later.

If the Kandahar killings sent a shudder through U.S.-Afghan relations and through the military itself this spring as the horror of the case emerged, it seemed clear from the day’s opening testimony — and the sharp cross-examination by Sergeant Bales’s defense team — that the Article 32 hearing itself could continue the aftershocks.

One of the first witnesses, for example, Cpl. David Godwin, testifying under immunity from prosecution, told the court he had violated Army rules on the night of the killings by drinking alcohol with Sergeant Bales and another soldier.

Under direct examination by prosecutors, Corporal Godwin said the three had a couple of drinks — Jack Daniel’s, concealed in a water bottle — in one of the soldier’s rooms while watching a movie, “Man on Fire,” about a former intelligence operative who seeks violent revenge after a girl’s kidnapping. Using a word that Colonel Morse had used in outlining the case, Corporal Godwin repeatedly said that Sergeant Bales was “coherent,” and that neither Sergeant Bales nor the other soldier, as far as Corporal Godwin could tell, was intoxicated.

One of Sergeant Bales’s defense lawyers, Emma Scanlan, suggested in her cross-examination that Corporal Godwin underestimated the alcohol use and misread Sergeant Bales’s state of mind when the sergeant returned to camp in bloody clothes just before 5 a.m. Under her questioning, Corporal Godwin admitted that he had exchanged perhaps five or six sentences with Sergeant Bales outside the camp gate at the sergeant’s return, as the unit hurried to respond to reports of civilian casualties and a missing soldier.

That brief exchange, she said, is the “basis of saying he was coherent.” Sergeant Bales was also wearing a cape when he returned to the unit, and Ms. Scanlan’s questions suggested that this also indicated something odd.

“Is that normal behavior?” she asked the witness.

“No,” Corporal Godwin said.

“Do you wear a cape?” she asked.

“No,” he said.

Another of Sergeant Bales’s lawyers, John Henry Browne, has said Sergeant Bales suffered post-traumatic stress. Mr. Browne, who was en route to Afghanistan to be there for witness testimony this week, said in an interview over the weekend that issues of Sergeant Bales’s hospitalizations, for a foot wound and a head wound, and his previous deployments — three in Iraq, the fourth in Afghanistan — would also be explored in the Article 32 inquiry.

In the charge sheet that is the basis for the hearing, Sergeant Bales faces 16 counts of murder with premeditation, six counts of attempted murder with premeditation, six counts of assault, as well as other charges of impeding the investigation, use and possession of steroids and the consumption of alcohol, which is forbidden to Army soldiers in Afghanistan.

Colonel Morse, the prosecutor, said in his remarks that the blood on Sergeant Bales’s clothes forensically matched the blood of some of the victims, and Sergeant Bales’s own words, documented at the time, would show a “chilling premeditation.”

But witnesses talked about the strangeness they saw that night.

One of them, a soldier in the unit, Sgt. First Class Clayton Blackshear, described Sergeant Bales at one point in the evening as “ghostlike.” Then he shrugged. “There’s no word in the English language,” he said.

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Shunning Amazon, Booksellers Resist a Transformation

SAN FRANCISCO — Amazon prides itself on unraveling the established order. This fall, signs of Amazon-inspired disruption are everywhere.

There is the slow-motion crackup of electronics showroom Best Buy. There is Amazon’s rumored entry into the wine business, which is already agitating competitors. And there is the merger of Random House and Penguin, an effort to create a mega-publisher sufficiently hefty to negotiate with the retailer on equal terms.

Amazon inspires anxiety just about everywhere, but its publishing arm is getting pushback from all sorts of booksellers, who are scorning the imprint’s most prominent title, Timothy Ferriss’s “The 4-Hour Chef.” That book is coming out just before Thanksgiving into a fragmented book-selling landscape that Amazon has done much to create but that eludes its control.

Mr. Ferriss’s first book, “The 4-Hour Workweek,” sold nearly a half-million copies in its original print edition, according to Nielsen BookScan. A follow-up devoted to the body did nearly as well. Those books about finding success without trying too hard were a particular hit with young men, who identified with their quasi-scientific entrepreneurial spirit.

Signing Mr. Ferriss was seen as a smart choice by Amazon, which wanted books that would make a splash in both the digital and physical worlds. When the seven-figure deal was announced in August 2011, Mr. Ferriss, a former nutritional supplements marketer, said this was “a chance to really show what the future of books looks like.”

Now that publication is at hand, that future looks messy and angry. Barnes & Noble, struggling to remain relevant in Amazon’s shadow, has been emphatic that it will not carry its competitor’s books. Other large physical and digital stores seem to be uninterested or even opposed to the book. Many independent stores feel betrayed by Mr. Ferriss, whom they had championed. They will do nothing to help him if it involves helping a company they feel is hellbent on their destruction.

“At a certain point you have to decide how far you want to nail your own coffin shut,” said Michael Tucker, owner of the Books Inc. chain here. “Amazon wants to completely control the entire book trade. You’re crazy if you want to play that game with them.”

Bill Petrocelli, co-owner of Book Passage, a large store in suburban Marin County, expressed similar reservations. “We don’t think it’s in our best interests to do business with Amazon,” he said.

Crown, a division of Random House, took on Mr. Ferriss in 2007, after more than two dozen publishers said no to him. “Crown put in a lot of effort to promote those books,” Mr. Petrocelli said. “He decided to walk away. That’s his decision to make but I can’t say I applaud it. I think writers should be supportive of publishers that are supportive of them.”

This isn’t a full-fledged boycott. Books Inc. and Book Passage said they would special order “The 4-Hour Chef” for anyone who wanted one. And some independent stores will even display it, if not enthusiastically.

Green Apple, another big independent San Francisco store, said it would stock the book, figuring that if there was money to be made on its sale, better Green Apple make it than Amazon. But Kevin Ryan, the store’s buyer, said there were limits. “We’re not going to go out of our way to promote something from Amazon,” he said. “We’re not going to stretch.”

When Mr. Ferriss signed with Amazon, he celebrated the new at the expense of the old. “I don’t feel like I’m giving up anything, financially or otherwise,” he said.

He has a somewhat different view these days. “By signing with Amazon, I expected this type of blowback,” he said. “I’ve been girding my loins.”

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Well: Limits to Resveratrol as a Metabolism Aid

Resveratrol, the red wine component shown to be helpful in improving metabolic function in obese or diabetic people, has no discernible effect on healthy women who are not obese, a new experiment has found.

In a small 12-week randomized, double-blinded trial, researchers gave 29 normal weight postmenopausal women either 75 milligrams a day of resveratrol or a placebo, testing their metabolic function at the start and end of the study.

Blood concentrations of resveratrol increased in the group given the supplements, but the scientists found no difference between them and those given the placebo in body composition, resting metabolic rate or glucose tolerance (a test for insulin resistance and diabetes).

The study, to be published in this week’s issue of the journal Cell Metabolism, found that blood pressure, heart rate, C-reactive protein levels (a measure of inflammation), LDL, HDL and total cholesterol were unaffected by resveratrol. In other words, resveratrol blood concentrations were associated with no quantifiable changes, beneficial or otherwise, in any measure of metabolic function.

Does this mean that resveratrol offers no benefits? Not necessarily, said the senior author, Dr. Samuel Klein, a professor of medicine at Washington University in St. Louis. “We only show that metabolically healthy people get no benefits to begin with,” he said. “We have no way of knowing whether it will prevent future metabolic complications.”

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Well: Limits to Resveratrol as a Metabolism Aid

Resveratrol, the red wine component shown to be helpful in improving metabolic function in obese or diabetic people, has no discernible effect on healthy women who are not obese, a new experiment has found.

In a small 12-week randomized, double-blinded trial, researchers gave 29 normal weight postmenopausal women either 75 milligrams a day of resveratrol or a placebo, testing their metabolic function at the start and end of the study.

Blood concentrations of resveratrol increased in the group given the supplements, but the scientists found no difference between them and those given the placebo in body composition, resting metabolic rate or glucose tolerance (a test for insulin resistance and diabetes).

The study, to be published in this week’s issue of the journal Cell Metabolism, found that blood pressure, heart rate, C-reactive protein levels (a measure of inflammation), LDL, HDL and total cholesterol were unaffected by resveratrol. In other words, resveratrol blood concentrations were associated with no quantifiable changes, beneficial or otherwise, in any measure of metabolic function.

Does this mean that resveratrol offers no benefits? Not necessarily, said the senior author, Dr. Samuel Klein, a professor of medicine at Washington University in St. Louis. “We only show that metabolically healthy people get no benefits to begin with,” he said. “We have no way of knowing whether it will prevent future metabolic complications.”

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Google Casts a Big Shadow on Smaller Web Sites

Annie Tritt for The New York Times

Jeffrey G. Katz, the chief executive of Wize Commerce, seen with employees. He says that about 60 percent of the traffic for the company’s Nextag comparison-shopping site comes from Google.

In a geeky fire drill, engineers and outside consultants at Nextag scrambled to see if the problem was its own fault. Maybe some inadvertent change had prompted Google’s algorithm to demote Nextag when a person typed in shopping-related search terms like “kitchen table” or “lawn mower.”

But no, the engineers determined. And traffic from Google’s search engine continued to decline, by half.

Nextag’s response? It doubled its spending on Google paid search advertising in the last five months.

The move was costly but necessary to retain shoppers, Mr. Katz says, because an estimated 60 percent of Nextag’s traffic comes from Google, both from free search and paid search ads, which are ads that are related to search results and appear next to them. “We had to do it,” says Mr. Katz, chief executive of Wize Commerce, owner of Nextag. “We’re living in Google’s world.”

Regulators in the United States and Europe are conducting sweeping inquiries of Google, the dominant Internet search and advertising company. Google rose by technological innovation and business acumen; in the United States, it has 67 percent of the search market and collects 75 percent of search ad dollars. Being big is no crime, but if a powerful company uses market muscle to stifle competition, that is an antitrust violation.

So the government is focusing on life in Google’s world for the sprawling economic ecosystem of Web sites that depend on their ranking in search results. What is it like to live this way, in a giant’s shadow? The experience of its inhabitants is nuanced and complex, a blend of admiration and fear.

The relationship between Google and Web sites, publishers and advertisers often seems lopsided, if not unfair. Yet Google has also provided and nurtured a landscape of opportunity. Its ecosystem generates $80 billion a year in revenue for 1.8 million businesses, Web sites and nonprofit organizations in the United States alone, it estimates.

The government’s scrutiny of Google is the most exhaustive investigation of a major corporation since the pursuit of Microsoft in the late 1990s.

The staff of the Federal Trade Commission has recommended preparing an antitrust suit against Google, according to people briefed on the inquiry, who spoke on the condition they not be identified. But the commissioners must vote to proceed. Even if they do, the government and Google could settle.

Google has drawn the attention of antitrust officials as it has moved aggressively beyond its dominant product — search and search advertising — into fields like online commerce and local reviews. The antitrust issue is whether Google uses its search engine to favor its offerings like Google Shopping and Google Plus Local over rivals.

For policy makers, Google is a tough call.

“What to do with an attractive monopolist, like Google, is a really challenging issue for antitrust,” says Tim Wu, a professor at Columbia Law School and a former senior adviser to the F.T.C. “The goal is to encourage them to stay in power by continuing to innovate instead of excluding competitors.”

SPEAKING at a Google Zeitgeist conference in Arizona last month, Larry Page, the company’s co-founder and chief executive, said he understood the government scrutiny of his company, given Google’s size and reach. “There’s very many decisions we make that really impact a lot of people,” he acknowledged.

The main reason is that Google is continually adjusting its search algorithm — the smart software that determines the relevance, ranking and presentation of search results, typically links to other Web sites.

Google says it makes the changes to improve its service, and has long maintained that its algorithm weeds out low-quality sites and shows the most useful results, whether or not they link to Google products.

“Our first and highest goal has to be to get the user the information they want as quickly and easily as possible,” says Matt Cutts, leader of the Web spam team at Google.

But Google’s algorithm is secret, and changes can leave Web sites scrambling.

Consider Vote-USA.org, a nonprofit group started in 2003. It provides online information for voters to avoid the frustration of arriving at a polling booth and barely recognizing half the names on the ballot. The site posts free sample ballots for federal, state and local elections with candidates’ pictures, biographies and views on issues.

In the 2004 and 2006 elections, users created tens of thousands of sample ballots. By 2008, traffic had fallen sharply, says Ron Kahlow, who runs Vote-USA.org, because “we dropped off the face of the map on Google.”

As founder of a search-engine optimization company and a recipient of grants that Google gives nonprofits to advertise free, Mr. Kahlow knows a thing or two about how to operate in Google’s world. He pored over Google’s guidelines for Web sites, made changes and e-mailed Google. Yet he received no response.

“I lost all donations to support the operation,” he said. “It was very, very painful.”

A breakthrough came through a personal connection. A friend of Mr. Kahlow knew Ed Black, chief executive of the Computer & Communications Industry Association, whose members include Google. Mr. Black made an inquiry on Mr. Kahlow’s behalf, and a Google engineer investigated.

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Syrian Rebels Claim to Kill Dozens of Soldiers

SANA, via Associated Press

An image released by Syria’s official news agency showed Damascus residents gathering at the scene of a blast on Monday.

BEIRUT, Lebanon — Syria was convulsed by one of the most violent days in months on Monday, with heavy fighting reported around Palestinian neighborhoods in southern Damascus, at least two car-bomb explosions and strikes by government aircraft on numerous rebel targets.

Sharply conflicting accounts emerged from the government and the rebels on the toll from a car bombing near the central city of Hama, with the rebels reporting dozens of soldiers dead and the government saying just two civilians were killed.

The Syrian Observatory for Human Rights, a group based in Britain with a network of contacts inside Syria, said that Jabhet al-Nusra, a jihadist organization, and other rebel groups in the region collaborated in a suicide car bombing of a government checkpoint in a village near Hama, killing at least 50 soldiers.

“They targeted one of the biggest checkpoints in the region. It’s a big building where the regime forces were headquartered,” said Ahmad Raadoun, a member of the Free Syrian Army in the Hama suburbs, who was reached via Skype.

Mr. Raadoun, who said he was about 20 miles from the village of Ziyara, where the attack took place, said the bomb caused extensive casualties and other damage in what he described as a “big operation.”

The official news agency, SANA, said the explosion, outside a government building called the Rural Development Center, was orchestrated by terrorist groups and left 2 civilians dead and 10 wounded. The government has repeatedly labeled opposition groups seeking to topple President Bashar al-Assad as terrorist organizations.

The reasons for such divergent accounts could not be immediately ascertained.

Checkpoints in rural areas often serve as rudimentary bases for the government, with large numbers of men and matériel stationed in them to carry the fight across the province.

Another car bombing was reported in Mazzeh 86, a Damascus neighborhood on the slopes below the presidential palace, home to many members of the security forces. The forces are dominated by members of Mr. Assad’s Alawite minority, which controls the country.

The Free Syrian Army claimed responsibility for that attack, saying in a statement that its fighters had targeted officers as well as members of the armed militias who fight for the government. The statement, posted on Facebook, claimed a large number of casualties but did not give any figures.

The Syrian Observatory said the bomb, which it described as a booby-trapped car that exploded in Bride Square, killed 5 people and wounded more than 30, some of them critically.

Pictures posted on Facebook showed a large column of smoke rising from the area.

Damascus residents reached by telephone said that they were trying to flee the heavy fighting, but that there was so much going on in every direction that they did not quite know where to run.

“There is very, very intense shelling on southern Damascus right now,” said an activist reached by Skype who goes by Abu Qays al-Shami. At least 10 people were killed as government helicopters and tanks blasted the area, he said.

Residents said the fighting had erupted in and around the Yarmouk camp in southern Damascus, the center of Palestinian life in Syria for decades. Many Palestinians have sided with the nearly 20-month-old anti-Assad uprising, but the Popular Front for the Liberation of Palestine-General Command, a splinter Palestinian group long supported by the government, still backs Mr. Assad. The fighting erupted between the organization and government opponents.

Elsewhere in southern Damascus, government helicopters were shelling the restive neighborhood of Hajjar al-Aswad, a target of frequent attacks in recent weeks, according to the Local Coordinating Committees, an anti-Assad activist group that keeps track of casualties. SANA said five people were killed in Yarmouk, including a woman and three children, when a mortar shell hit a public minibus. The agency blamed terrorist organizations.

In its daily roundup of violence around the country, SANA also said that government forces clashed with opposition groups in the eastern city of Deir ez-Zour and in Aleppo, the northern city that has been a battleground since midsummer.

Activist organizations reported a number of airstrikes around the country.

One extremely graphic video posted from the village of Kafrnabel, near Idlib, shows bloodied victims dumped into a truck in the aftermath of what was described as an aerial assault. A shot of the main street shows flames leaping from vehicles and residents running around in panic. At least five men and one woman died, the Syrian Observatory said, but more victims were believed buried under the rubble. Video accounts cannot be independently confirmed.

At the United Nations on Monday, a top relief official said the organization’s aid effort in Syria “is very dangerous and very difficult.” The official, John Ging, director of operations of the Office for the Coordination of Humanitarian Affairs, told reporters at a news conference that the United Nations was supplying 1.5 million people in Syria with food and that nearly half is delivered into areas of conflict, but “there are areas beyond our reach, particularly areas under opposition control for quite a long time.”

Reporting was contributed by Hania Mourtada from Beirut, Hala Droubi from Dubai, United Arab Emirates, and Rick Gladstone from New York.

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