Machinists to vote again on Boeing 777X offer

SEATTLE — National leaders of the Machinists union are scheduling a vote on a proposed contract between Boeing and Puget Sound machinists, despite objections from local union officials who have already rejected the company's latest offer.

The lead negotiator for the union's national headquarters, Rich Michalski, told The Seattle Times in a phone interview that a vote is set for Jan. 3, the newspaper reported Saturday.

The contract would secure work on Boeing new 777X airplane at a time when 22 states are vying for those jobs. The company says it expects to pick a location early next year.

The local union, District 751, said on its website Saturday that there's no stopping the vote and urged members to reject the contract.

"Despite objections from District 751 leadership, the International has insisted on a vote on January 3rd to ensure you spend your holidays studying and debating a concessionary proposal that is largely unchanged from the one you rejected by a 2-to-1 margin on Nov. 13," the statement said.

"We're adamantly recommending that our members reject the offer," local union spokesman Bryan Corliss said Saturday. "The timing will make it hard to get members information to make a decision."

National union spokesman Frank Larkin said Saturday the vote is being scheduled to respond to members who have been calling for one and in keeping with a long union tradition that members have the final say.

He added: "It's obviously a controversial proposal. There is a range of opinions. The vote will be by secret ballot and the members will have the last word."

Local leaders of the International Association of Machinists and Aerospace Workers have faced pressure in recent days for declining to put Boeing's last offer to a vote.

"The terms of Boeing's enhanced contract offer to the IAM on December 12 stand," Boeing spokesman Doug Alder said in a statement Saturday. "If ratified by the membership, Boeing would honor that contract."

Boeing has gotten proposals from 22 states covering 54 locations that all want to build the plane. Boeing says it is narrowing the list down and is telling each location its status in the process. Boeing isn't releasing the list publicly.

State officials in North Carolina said Boeing told them Friday that sites in Charlotte, Greensboro and Kinston were out of the running.

The 777X is expected to bring thousands of well-paying jobs to wherever it is assembled.

Boeing began looking for a new location to build the successor to its popular 777 after union workers in Washington state rejected a deal that would have kept the work there.

The latest round of contract talks collapsed earlier this month when local Machinists officials said they could not recommend Boeing's latest proposal to members.

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Raul Castro issues stern warning to entrepreneurs

HAVANA — President Raul Castro issued a stern warning to entrepreneurs pushing the boundaries of Cuba's economic reform, telling parliament on Saturday that "those pressuring us to move faster are moving us toward failure."

Castro has legalized small-scale, private businesses in nearly 200 fields since 2010, but has issued tighter regulations on businesses seen as going too far or competing excessively with state enterprises. In recent months, the government has banned the resale of imported hardware and clothing and cracked down on unlicensed private videogame and movie salons.

Castro threw his full weight behind such measures in an address to the biannual meeting of the communist legislature, saying "every step we take must be accompanied by the establishment of a sense of order."

"Inadequate controls by government institutions in the face of illegal activities by private businesspeople weren't resolved in a timely fashion, creating an environment of impunity and stimulating the accelerated growth of activities that were never authorized for certain occupations," Castro said.

He told lawmakers that Cuba wants better relations with the U.S. but will never give in to demands for changes to Cuba's government and economy, saying "we don't demand that the U.S. change its political or social system and we don't accept negotiations over ours."

"If we really want to move our bilateral relations forward, we'll have to learn to respect our differences," Castro said. "If not, we're ready to take another 55 years in the same situation."

Cuba blames a half-century-old U.S. embargo for strangling its economy but Castro's government has also acknowledged that it must reform the state-run economy with a gradual opening to private enterprise. Many Cubans have enthusiastically seized opportunities to make more money with their own businesses, but new entrepreneurs and outside experts alike complain that the government has been sending mixed messages about its openness to private enterprise.

The conflicting signals were apparent in Cuba's handling of the dozens of private home cinemas and video game salons that sprung up around the country this year, drawing crowds of young people willing to spend a few dollars for access to the latest home entertainment technology imported, purportedly for private use, by Cubans returning from the U.S., Canada or other countries.

The government denounced the cinemas as spreading uncultured drivel to the young, and ordered them closed last month for stretching the boundaries on the kinds of private businesses allowed under reforms instituted by Castro. Then came the backlash, with entrepreneurs bemoaning thousands of dollars in lost investment and moviegoers saying they were exasperated by heavy-handedness toward a harmless diversion. The official reaction was swift, and unprecedented.

An article in the Communist Party newspaper Granma on last month acknowledged there was wide disapproval of the ban, and hinted it was being rethought. The same Granma article also offered a full-throated defense of the ban on the reselling of imported hardware and clothes.

Castro appeared to justify all of the recent moves to clamp down on private enterprise.

"We're not ignorant of the fact that those pressuring to move faster are moving us toward failure, toward disunity, and are damaging the people's confidence and support for the construction of socialism and the independence and sovereignty of Cuba."

Several Cubans interviewed on the streets of Havana said they generally approved of Castro's speech but wanted more details on economic reforms, and a softer line toward the U.S.

"I would have liked to know exactly what pace of reform we're going to follow," said Daniel Mora, a 72-year-old retired state worker. "And he told the United States that we're ready for another 55 years of blockade, but I'm not ready for that. I'm 72 and I'd like to see the light at the end of the tunnel before I die."

Castro praised the Cold War ties between Cuba and South Africa's anti-apartheid movement but did not mention his handshake with President Barack Obama at Nelson Mandela's funeral this month.

He lamented that growth would come in at 2.7 percent for 2013, nearly a full percentage below the predicted 3.6 percent. He said growth for 2014 was expected to be 2.2 percent.

It is nearly impossible to know on the true size of Cuba's economy because Cuba uses two currencies, a convertible peso for tourists that's pegged to the U.S. dollar and a Cuban peso worth about 4 cents, and the government doesn't clearly distinguish between them in economic statistics.

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Anne-Marie Garcia contributed to this report.

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Michael Weissenstein on Twitter: https://twitter.com/mweissenstein

Andrea Rodriguez on Twitter: https://twitter.com/ARodriguezAP

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Truck owner unsure about block heater, synthetic oil

I have a 2006 Ford F-150 with the 5.4 V8 engine. The truck has only 32,000 miles on it. When the oil is changed, sometimes it is somewhat milky. I know this is most likely from cold morning starts coupled with a 2-mile drive to work. The engine barely has time to warm up. My question is the use of a block heater overnight when it is extremely cold. Will the heat from the block heater cause engine condensation? The heater makes a huge difference in ease of start-up and the engine warms quicker. Should I not be using the block heater? I started using synthetic oil as well.

Entirely appropriate question with the recent spell of frigid temperatures across much of the country. I'm a firm believer in engine block heaters in areas where temperatures drop to zero or below. The benefits of easier cranking, faster starting, lower stress on the starter motor, battery and engine and faster lubrication to critical components far outweigh any — well, I can't think of any downsides!

Condensation inside the crankcase is going to occur during cold weather starts when moisture in the air inside the engine is rapidly heated upon start-up. The only way to eliminate this moisture is to drive the fully warmed up vehicle long enough to evaporate and expel the moisture through the PCV system. In addition, more frequent oil changes during cold weather can be a useful tool in removing moisture and fuel contamination from the oil.

Does using a block heater contribute to higher levels of moisture contamination? I don't know for sure, but the fact that a block heater slowly warms up the engine, coolant (and to some extent the oil) and maintains that temperature would likely contribute little if any additional condensation.

Thus, I think your use of synthetic oil and a block heater is a very solid game plan for winter.

I have a 2007 Dodge Grand Caravan. If it sits three to four days without starting, the battery is dead. I have taken it to the dealer several times and they cannot find anything wrong with the charging system. Their report states "tested for excessive IOD and it is at 14ma and well within spec. Saw the IOD jump to 3M randomly for just a second but never above the max spec of allowable draw." They advised to "pull the IOD fuse" when planning on not starting the vehicle for a few days at a time. They also told me that this was normal, which I find difficult to believe.

This is not normal. Your first test should be to disconnect the battery while the vehicle is parked, then after three or four days reconnect it and see if the vehicle will start. If not, the battery is not holding a charge and needs replacement. This could easily be the issue.

If it does start after three to four days, there must be some type of parasitic current draw that's draining the battery. Current drawn with the ignition off should not exceed roughly 50ma (.05 amperes). This level of parasitic current will not kill a good battery in a few days.

The "IOD" fuse in your vehicle controls ignition-off power to those circuits with KAMs — keep-alive memories. Removing this fuse will only stop current flow to those components but won't stop a parasitic draw from some other source.

To find a parasitic draw, disconnect the negative battery cable and connect an ammeter or 12-volt taillamp bulb in series between the cable and negative terminal. If the bulb glows and/or the ammeter reads a significant parasitic loss, pull each and every fuse and relay, one at a time. Hopefully the current flow will stop when you find the circuit drawing current.

A small lamp, such as the glovebox light, or a stuck electrical relay would be likely culprits in a dead battery after several days.

Paul Brand, author of "How to Repair Your Car," is an automotive troubleshooter, driving instructor and former race-car driver. Readers may write to him at: Star Tribune, 425 Portland Ave. S., Minneapolis, Minn., 55488 or via email at paulbrand@startribune.com. Please explain the problem in detail and include a daytime phone number. Because of the volume of mail, we cannot provide personal replies.

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Fannie, Freddie hiking mortgage loan fees

Buying a home will be more costly next year for many people thanks to planned fee increases.

Fannie Mae and Freddie Mac will hike the guarantee fees on government-backed mortgage loans — fees that typically are passed along to borrowers and will result in higher mortgage rates.

The Federal Housing Finance Agency announced the policy change Dec. 9 as part of an effort to decrease the government-owned mortgage finance companies' presence in the U.S. mortgage market and bring private capital back into the mix.

"Any increased fees impact people's ability to obtain home ownership," said Brenda Clement, executive director of the Citizens' Housing and Planning Association, a nonprofit umbrella group for affordable housing and community development in Massachusetts. "The housing market has come back slowly, particularly for people at the low-income levels, and anything that increases fees or increases the complexity of buying a home is always problematic."

On Monday, Fannie and Freddie, which currently back about two-thirds of new U.S. mortgages, said fees will rise sharply for many borrowers who don't make down payments of at least
20 percent and don't have high enough credit scores — a large share of homebuyers.

The fee increases are especially hard to swallow in Massachusetts, a higher-
value area in terms of real estate and housing costs in general, said Peter Ruffini, incoming president of the Massachusetts Association of Realtors and regional vice president at Jack Conway Realtors in Norwell. "Whenever we hear news like this, oftentimes it impacts us to a greater extent," he said.

Interest rates already are expected to creep into the 
5 percent to 5.5 percent range, absent the fee increases, Ruffini noted. "Things like this affect a first-time homebuyer's ability to get into the market," Ruffini said. "It decreased their purchasing power, and it's tough to get a loan right now anyway."

Making mortgages more expensive, especially while interest rates already are rising, may inhibit the recovery and have unintended consequences, said David Abromowitz, a Boston attorney who specializes in affordable housing. "Raising the guaranty fees now won't make the housing system safer, as lenders are already screening out borrowers without high credit scores and strong, documented income," said Abromowitz, a senior fellow at the Center for American Progress, a progressive Washington, D.C., public policy think tank. "But it will make home-buying more costly, while rents are also shooting up — with the consumer losing out either way."

Herald wire services contributed to this report.

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Cool Deal fills FIFA cup

A Plymouth company will help hydrate soccer fans across the globe under a licensing deal with the Federation Internationale de Football Association.

Cool Gear International will produce FIFA-themed, reusable chillers, tumblers and its signature coolgearcans to mark the 2014 FIFA World Cup that will be hosted by Brazil from June 12 to July 13.

"We've done some really fun stuff for the World Cup," Cool Gear founder and CEO Donna Roth said. "It's an exciting deal for us because it's hitting a different market for us — sports — but still is viable for (the mass market) as well."

Cool Gear pursued the FIFA contract because it recently broke into the sporting goods market, and it has strong distributors in Brazil and key countries around the world, according to Roth.

"We developed a line of products that was more geared to the sporting goods industries — higher scale bottles, with a little more bells and whistles," she said.

In addition to World Cup venues, the collectable products will be sold in North America, elsewhere in Brazil, Europe, Colombia, Africa and South Korea. They'll be available locally at Dick's Sporting Goods this month and at www.coolgearinc.com.

Roth, who categorized Cool Gear as a mid-middle market company, declined to reveal the value of the FIFA deal or privately held Cool Gear's annual revenue. Mid-middle market companies' revenue range from $50 million to 
$500 million.

"It will be a nice piece to add," Roth said of the FIFA deal. "The time frame is short. We'll get a big hit this first and second quarter, and then it will be over."

The FIFA deal — along with a three-year agreement signed with Coca-Cola in October — is part of a move by Cool Gear to get back into licensing.

Its predecessor company, Fun Designs, was heavily into licensing in the 1990s and had deals with companies including Disney, Warner Bros. and Nickelodeon. But at the same time, it was developing its Cool Gear brand, and when licensing royalties "went through the roof," it decided to concentrate on its own brand and renamed the company.

All of Cool Gear's products are proprietary, and it has more than 150 patents for them. Introduced this summer, its coolgearcan is a double-wall insulated, BPA-free plastic beverage holder that looks like a 12-ounce can, but is 
reusable and has a spill-proof slider lid.

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Range Rover maintains its regal reign

Still big, burly and brawny, but always with a regal air, the 2014 Range Rover holds its spot as the aristocrat of full-sized SUVs. Battling able competitors such as the Mercedes-Benz, Cadillac Escalade and Lexus LX 570, Range Rover rules not because of its luxury, but because it still wants to careen through nearly 3 feet of water and not get your feet wet.

In 2013, Range Rover trimmed down the fleet king by almost 800 pounds, and year 2 of the revamp features only a noteworthy tweak — a new 3.0 liter 340- horsepower supercharged V-6 engine replaces the 5.0 liter V-8. And it runs strong and smoothly mated to the slick eight-speed automatic. Gas mileage in this all-wheel-drive titan is 17 miles per gallon in the city and 23 on the highway — an improvement of nearly 4 mpg over earlier models. The V6 is quick, powerful and has excellent acceleration through traffic. It's hard to believe, but this truck easily bests many performance sports sedans, reportedly doing 0-60 mph in 7.1 seconds.

Three trim levels are available and our tester was the base model. All feature the Response 2 Terrain system that can be used either manually or automatically to adjust height and suspension for any type of terrain. Having recently tested and enjoyed driving the top level Range Rover Supercharged, the base model does not disappoint. The classic angular design continues to set this SUV apart from others in the class and, coupled with refined interior components, Range Rover strives to remain atop the competitive pile.

One drawback is that I do not find the driver's seat particularly comfortable to sit in. It feels stiff, a bit bench-like to me. The leather on the base model is nice but not as supple as the Oxford leather the HSE trim features, although it still outpaces many other manufacturers in quality. Fit and finish of the interior is pristine. The blend of soft touch surfaces, leather panels, metal and hard plastics creates a solid and sensible interior that is also very inviting.

The ghostly electronic virtual dash display is standard across the fleet and is subtle yet feeds you all the information you need. This tester had the stock 380-watt 13-speaker system and its sound is terrific. The 8-inch touch screen is easy to use and I found it quite intuitive. All the controls are redundant, responding to voice commands or the steering wheel controls.

As always the high driver's position makes for easy driving and fine sight lines. The rear seats provide plenty of legroom and a quick flip of a lever drops the seats down to create a cavernous deck. The split tailgate makes a nice spot to sit on if you've a picnic packed.

At $86,895, the Range Rover price slots in the middle of the mix of luxury SUVs, but delivers top- notch performance and creature comforts.

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Ariad’s stock soars after drug approved by FDA

Ariad Pharmaceuticals' stock rose 16 percent yesterday after the company announced that the Food and Drug Administration had approved revised prescribing information and other steps the FDA required to allow Ariad to resume marketing and distribution of its leukemia drug, Iclusig.

Commercial distribution of the drug is expected to begin by mid- to late-January after the Cambridge company agreed to change Iclusig's label to include new warnings about the risks of blood clots and heart failure, and to revise recommendations about dosage and administration of the drug.

"We are committed to ... helping patients and their physicians make informed decisions about the most appropriate use of Iclusig in the context of the revised product label," said Dr. Frank Haluska, Ariad's senior vice president and chief medical officer.

At the FDA's request, the company agreed on Oct. 31 to voluntarily suspend marketing of the drug because of concerns that patients taking it could suffer life-threatening blood clots.

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Patriots fan’s paradise

The owner of this new Brookline home will be neighbors with Patriots owner Robert Kraft and quarterback Tom Brady.

The 6,000-square-foot shingle-style home at 324 Heath St. occupies nearly an acre in the wealthy Chestnut Hill enclave of south Brookline, on one of two pieces of land recently sold by Pine Manor College. The other parcel, which is 5.2 acres, went to Brady, whose palatial home is scheduled to be completed by next summer.

Designed by Cambridge architect Peter Quinn, 324 Heath is elegant without being ostentatious, with some farmhouse-style touches such as low-set windows and a wraparound covered rear deck. It has hand-stained oak floors, high-quality window and door moldings, coffered ceilings, stone fireplaces and lots of windows to bring in natural light. Each of its six bedrooms has an en-suite bathroom, and there are porches off most of them.

The home, with expansive living spaces and an attached three-car garage with a media room/guest bedroom above, is on the market for $4,699,000, just reduced by $200,000.

There's a low stone wall in front of the property, and much of its front yard is a U-shaped paver driveway for outdoor parking that also connects to the garage.

The exterior of the home is gray clapboard with large gables with second-floor porches and rounded bumpouts in the back. The covered front entrance is flanked with stone walls, and you enter a two-story foyer with hand-stained oak floors, coat closets, a turning staircase with a Rococo chandelier, a built-in display cabinet and even a stone chimney wall.

To the right is a formal living room where the other side of the chimney wall is a gas fireplace with a carved wood mantel above. There's a backlit coffered ceiling, recessed lighting and five windows.

On the other side of the foyer is a formal dining room with paneled wainscoting, a back-lit coffered ceiling and a Rococo chandelier. Off this room is a butler's pantry with gray granite countertops and a wine cooler.

The formal living spaces open into a huge open family room/kitchen area. The high-end kitchen features white cabinets, gray granite counters and gray glass mosaic tile backsplashes. There's a large center island with built-in microwave. Appliances are high-end stainless steel G.E. Monogram, including an oversized refrigerator, a dishwasher and professional grade gas stove with a white marble tile backsplash and a stainless steel hood. The eat-in area has seven windows overlooking the backyard and a door out to a wraparound covered back deck.

The backyard has a large bluestone patio and grass area edged by a stone wall. From this vantage point you can see some of the acreage of the Kraft and Brady properties on either side.

Back inside, the adjacent family room has a backlit ceiling as well as a rounded bumpout with a wall of windows also overlooking the backyard.

There's a second front entrance on the far left end of the home, with a foyer with a porcelain-tiled half bathroom, direct access to the garage and a set of back stairs to the second floor.

The main foyer's staircase leads up to the oak-floored master bedroom suite with recessed lighting and a gas fireplace with a wood mantel set into a stone chimney. There's a large walk-in closet with custom wardrobe built-ins. The showpiece of the master bathroom is a freestanding soaking tub. It also features porcelain tile floors that are radiant heated, a white marble-lined steam shower, and a granite-topped vanity with two sinks.

The other bedrooms all have oak floors, large closets and en-suite radiant-heated porcelain tile bathrooms. The second bedroom has cathedral ceilings and glass doors out to a balcony. The third bedroom opens onto a back porch. There's a wall of windows in the fourth bedroom. The large fifth bedroom, which also makes a great family/media room, sits above the garage and has three closets,

Also on this floor is a laundry room with a long granite countertop for folding, a sink and storage cabinets.

The sixth bedroom and full bathroom is on the first floor, down a set of back stairs.

The home is prewired so a smart-home. surround sound and alarm systems can be easily installed.

There's a huge unfinished basement that can accommodate more living space. The basement also houses the home's five-zone gas-fired heating and central cooling system.

Broker: Scott Miller of Realty Executives at 617-216-9260

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Boston OKs new farming rules

Boston officials are hoping to open up new opportunities for urban farmers by debuting city land-use regulations that make clear businesses growing fresh produce for inner city consumers are not only accepted, but welcomed.

Outgoing Mayor Thomas M. Menino this week announced the Boston Zoning Commission approved new zoning rules, after a three-year push to raise urban agriculture to a commercial level. The effort brought together city agencies and companies that had pioneered farming in the city.

"Growing food within our city limits means better access to food and economic empowerment, all while cultivating a sense of neighborhood unity and greening our city," Menino said, indicating he will sign the new rules into law.

The Boston Redevelopment Authority worked with the mayor's office in 2010 to launch two pilot "micro-farms" on city-owned land in Mattapan that helped shape the new zoning rules.

Jessie Banhazl, owner of Green City Growers, a Somerville firm that builds horticulture projects in city spaces, said Boston ordinances did not discourage city farming but neither did they regulate it, leaving urban farmers worried about how they would weather opposition from neighbors.

"I think, because of the visibility the ordinances bring to urban agriculture, it will make people more confident to take this on as a career choice," Banhazl said. "I think there's no limit to what will be possible."

There are other communities ahead of Boston, she said, but the new regulations put the Hub at the forefront of big cities in the country pushing commercial agriculture in urban patches and on rooftops.

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Obama names China envoy, economic ties in mind

WASHINGTON — The nomination of veteran Sen. Max Baucus as U.S. ambassador to China reflects the importance to Washington of advancing the economic relationship with the Asian power despite recent strains on security issues.

The Montana Democrat lacks foreign policy credentials but has a track record in pressing Beijing over trade barriers and its currency exchange rate. If his appointment is confirmed by the Senate, he will be looking to see that U.S. companies can benefit from market reforms the ruling communist party promised in November.

While the economic relationship between the countries is loaded with its own problems, including accusations of rampant Chinese cybertheft of U.S. trade secrets, it is one where their national interests are more aligned than on security, as China challenges decades of U.S. military pre-eminence in the Asia-Pacific.

China's declaration of an air defense zone over disputed territory in the East China Sea and a near-collision of U.S. and Chinese naval vessels this month brought those concerns to the fore. Defense Secretary Chuck Hagel on Thursday described China's conduct in the Dec. 5 incident in the South China Sea as "irresponsible."

But when President Barack Obama announced Friday his intent to nominate Baucus as ambassador, he was stressing the senator's work over two decades on economic agreements with China that he said have created millions of American jobs. "He's perfectly suited to build on that progress in his new role," Obama said in a statement and called for a swift confirmation.

Baucus pushed for China's inclusion in the World Trade Organization in 2001, a key step in its integration in the world economy. Since then China has emerged as world's second-largest economy after the U.S., and America's second-largest trading partner. Two-way trade is projected to reach $558 billion in 2013.

But China's record on its WTO obligations is mixed, and trade with the U.S. is skewed heavily in China's favor. As chair of the powerful Senate Finance Committee, which oversees trade, Baucus has in recent years sponsored legislation to punish China for undervaluing its currency to benefit its exporters. The measure never made it into law. He's also criticized China for shutting out U.S. beef imports. But he's remained a strong advocate of expanding trade.

"The economic and financial relationship with China is crucial," said Cheng Li, a China expert at the Brookings Institution, a Washington think tank. "If that part of the relationship is healthy it can spill over and have a positive effect in other areas. But if it's jeopardized it can adversely affect other areas, including on security."

He expected China's leaders to welcome Baucus' appointment, given his stature as a six-term senator and close ties with Obama.

China's Global Times newspaper, which is affiliated with the ruling party, said Baucus' experience made him a good pick for the job.

"We hope and believe that Mr. Baucus can bring his Capitol Hill experience and personal relationship with the president to use in furthering U.S.-China trade ties and the building of a new type of major state-to-state relationship," the paper said, using Beijing's buzzword for its desire to be treated by Washington as an equal.

Comments on China's Twitter-like Weibo microblogging service were also largely positive, although some wondered whether the 72-year-old would be able to adapt to the Chinese capital's notorious smog.

The incumbent is former commerce secretary Gary Locke. As the first Chinese-American ambassador to Beijing, Locke has been a well-known and generally well-liked figure in China. He created a buzz among ordinary Chinese even before he arrived in Beijing after he was photographed wearing a backpack and trying to use a coupon to buy coffee at Seattle's airport. Many Chinese Internet users pointed out the contrast with Chinese bureaucrats, who routinely have aides carry their bags and attend to minor tasks.

Locke has navigated choppy waters in the relationship, notably when dissident lawyer Chen Guangcheng in 2012 sought refuge in the U.S. Embassy on the eve of high-level U.S.-China talks in Beijing. China subsequently allowed Chen to leave for New York, and the talks proceeded.

The latest turbulence has centered on China pressing its territorial claim against U.S. ally Japan in the East China Sea. China's effort to control air space in the region was criticized this week by Secretary of State John Kerry, who said it "clearly increases the risk of a dangerous miscalculation or an accident."

Given the prickly state of the relationship, Bonnie Glaser, a China expert at the Center for Strategic and International Studies, voiced surprise that Obama did not select an envoy with more clout on hard security issues.

She said the nomination of Baucus reflected the president's tendency to focus on the economic aspects of the relationship with China, as he seeks to boost exports and reduce unemployment at home.

His administration wants to "level the playing field" for American companies: curb cybercrime and theft of intellectual property and improve market access, particularly in the heavily restricted services sector. The U.S. has welcomed China's intent to open state-dominated industries wider to private competition and ease limits on foreign investment.

Erin Ennis, vice president of the U.S.-China Business Council, said a key U.S. priority for Baucus should be to negotiate a strong bilateral investment treaty. She said discussions on a text are expected to start early next year, and as new ambassador, Baucus could help China understand what it will take for an agreement to win Senate ratification.

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Associated Press writer Christopher Bodeen in Beijing contributed to this report.

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