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 firms 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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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 — Some of the worst violence in months racked Syria on Monday with residents of southern Damascus fleeing heavy shelling, several smaller towns shattered by air attacks, and at least two car bombs.

The Local Coordinating Committees, a collection of activist organizations across Syria, said the daily toll reached at least 159, including 72 killed in Idlib, and 47 in Damascus and its suburbs.

People in Damascus, the capital, said the fighting was the fiercest they could remember since July, with thousands of people having fled as a Palestinian faction that supports the Assad government skirmished with government opponents in three southern neighborhoods.

“It’s a real war,” said an activist reached in southern Damascus via Skype, who used only one name, Eman, for her safety. “Explosions, bombing and gunfire, and of course the helicopters, which have become part of the sky in Damascus now, like birds,” she said.

The fighting, escalating over three days, ignited the quarters of Yarmouk and Tadamon, both heavily Palestinian, as well as Hajjar al-Aswad, a center of resistance to the government.

Syria took in large numbers of Palestinians who fled their homes at the founding of Israel, and they and their descendants number about 450,000 now. Many have sided with those leading the uprising, but the Popular Front for the Liberation of Palestine-General Command, a faction with a prominent role in the neighborhoods, still supports the government. Much of the fighting involved Popular Front units, backed by government artillery. Rounds fired from the military airfield in Mezze slammed into the area, activists said.

Yarmouk, founded as a Palestinian refugee camp in 1957, gradually became a residential district barely distinguishable from the rest of greater Damascus. A Facebook page focused on camp news published a statement from the Popular Front group saying it had thwarted an infiltration by government opponents.

“When the terrorists failed to enter, they fired mortars killing a large number of martyrs and wounding a lot of people,” the statement said.

Civilians have been fleeing in droves. Small artillery hit a minibus carrying people trying to escape from Yarmouk, killing five of them. Each side blamed the other for that strike.

Displaced families have started camping in back gardens or schoolyards, Eman said.

A car bomb exploded in Mezze 86, a Damascus neighborhood on the slopes below the official palace that houses the offices of President Bashar al-Assad. The area is heavily populated by families linked to the security forces, which Mr. Assad’s Alawite minority dominates. Pictures posted on Facebook showed a large black column of smoke rising from the area.

The Free Syrian Army claimed responsibility for that attack, saying in a statement that it targeted military officers and members of the armed militias who fight for the government.

The bomb, a booby-trapped car, exploded in Bride Square, killing at least 11 people and wounding more than 30, some of them critically, said the Syrian Observatory for Human Rights, which tracks the conflict from abroad.

The official news agency, SANA, also put the death toll at 11 but said at least 56 were injured. The explosion ignited other cars and caused widespread destruction, it said.

Accounts differed more sharply on another car bombing, outside a government-owned Rural Development Center near Hama. The rebels and activists reported that dozens of soldiers were killed; the government said just two civilians had died.

The Syrian Observatory said that Jabhet Al-Nusra — known as a jihadist organization — and other rebel groups in the region collaborated to explode a car bomb at a government checkpoint in a village near Hama, killing at least 50 soldiers. If true, that would make it one of the single deadliest anti-government attacks since the uprising started in March 2011.

The accounts from the observatory and rebel groups stated that the military had taken over the development center to house military units. Checkpoints in rural areas often serve as rudimentary bases for the government, with large numbers of men and equipment.

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

Mr. Raadoun said he was about 20 miles from the site, the village of Ziyara. He said the bomb caused extensive casualties and other damage.

Hania Mourtada contributed reporting from Beirut; Hala Droubi from Dubai, United Arab Emirates; and Rick Gladstone from New York.

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Apple sells three million iPads over first weekend

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Doctor: Colts coach Pagano's leukemia in remission

INDIANAPOLIS (AP) — Colts head coach Chuck Pagano is winning his battle with leukemia.

On Monday, Dr. Larry Cripe, Pagano's physician, told The Associated Press that the illness which has sidelined Indy's head coach for more than a month was in "complete remission." Cripe said a morning exam showed Pagano's white blood cell count and bone marrow tests were normal as he prepares to start a second round of chemotherapy.

The doctor explained patients typically undergo three rounds of treatment to wipe out any potentially lingering cancer cells. The second round of chemo is scheduled to start later this week and will last four to six weeks, Cripe said.

"His (blood cell) count was great," interim coach Bruce Arians told reporters after Pagano visited the team complex Monday. "He knows that this next one (round) is going to be really tough and we're praying for him, and he's going to be fine."

The latest medical update came less than 24 hours after Pagano returned to Lucas Oil Stadium for the first time since he was diagnosed with a form of leukemia on Sept. 26. Pagano spent most of the next month in an Indianapolis hospital, watching two Colts games from his room. On Oct. 21, he returned home where he watched the next two Indy games. Doctors wanted to keep him in primarily sterile environments to avoid any risk of infection.

On Sunday, Pagano cleared yet another hurdle when doctors allowed him to attend the Miami game in person. He watched the Colts win their third straight, 23-20, from the coaches' box and provided inspirational messages to players before and after the game.

"I've got circumstances. You guys understand it, I understand it. It's already beat. It's already beat," Pagano said during Sunday's postgame speech, hesitating to catch his breath a couple of times. "My vision that I'm living is to see two more daughters get married, dance at their weddings and then lift the Lombardi Trophy several times. I'm dancing at two more weddings and we're hoisting that trophy together, men. Congratulations, I love all of you."

Pagano's appearance Sunday was a clear indication things were going well. Cripe confirmed that in his comments Monday.

On the field, things have gone well for the Colts, too. Indy (5-3) is 4-1 since Arians, also a cancer survivor, was made interim coach and the sudden spate of success has put Indy back in the playoff discussion.

But as the Colts continue to shock the NFL world, Pagano's health status continues to loom large.

Team officials have hung signs reading (hash)Chuckstrong in each end zone of Lucas Oil Stadium. Reggie Wayne wore orange gloves for two games, the color designated to recognize leukemia, and Arians usually wears a button with an orange ribbon between the two sides of the horseshoe on his hat.

It's unclear whether Pagano will return to full coaching duties this season, though Arians made it clear he hopes that happens.

"Once he comes back from Round 2 and is about to head into Round 3, our goal is for him to be on the sideline Dec. 30," Arians said, referring to Indy's regular-season finale against Houston.

"We know what's coming, the downhill slide is yet to come," Arians added. "To me it's kind of like talking to him about the playoffs this week; one day at a time, one play at a time. There's some down time coming, but it's great to see him here."

___

Online: http://pro32.ap.org/poll and http://twitter.com/AP_NFL

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Unlikely Model for H.I.V. Prevention: Adult Film Industry

Stephanie Diani for The New York Times

INDUSTRY DATABASE Shylar Cobi, right, a film producer, confirmed test results of the actors who perform as James Deen and Stoya.

LOS ANGELES — Before they take off all their clothes, the actors who perform as James Deen and Stoya go through a ritual unique to the heterosexual adult film industry.

First, they show each other their cellphones: Each has an e-mail from a laboratory saying he or she just tested negative for H.I.V., syphilis, chlamydia and gonorrhea.

Then they sit beside the film’s producer, Shylar Cobi, as he checks an industry database with their real names to confirm that those negative tests are less than 15 days old.

Then, out on the pool terrace of the day’s set — a music producer’s hilltop home with a view of the Hollywood sign — they yank down their pants and stand around joking as Mr. Cobi quickly inspects their mouths, hands and genitals for sores.

“I’m not a doctor,” Mr. Cobi, who wears a pleasantly sheepish grin, says. “I’m only qualified to do this because I’ve been shooting porn since 1990 and I know what looks bad.”

Bizarre as the ritual is, it seems to work.

The industry’s medical consultants say that about 350,000 sex scenes have been shot without condoms since 2004, and H.I.V. has not been transmitted on a set once.

Outside the world of pornography, the industry’s testing regimen is not well known, and no serious academic study of it has ever been done. But when it was described to several AIDS experts, they all reacted by saying that there were far fewer infections than they would have expected, given how much high-risk sex takes place.

“I don’t think there’s any question that it works,” said Dr. Allan Ronald, a Canadian AIDS specialist who did landmark studies of the virus in prostitutes in a Nairobi slum. “I’m a little uncomfortable, because it’s giving the wrong message — that you can have multiple sex partners without condoms — but I can’t say it doesn’t work.”

Despite the regimen’s apparent success, California health officials and an advocacy group, the AIDS Healthcare Foundation, are trying to make it illegal to shoot without condoms. They argue that other sexually transmitted diseases are rampant in the industry, though the industry trade group disputes that.

In January, the city of Los Angeles passed a law requiring actors to wear condoms. A measure to do the same for the whole county is on the ballot on Tuesday.

Producers say the condom requirement will drive them out of business since consumers will not buy such films. Local newspapers like The Los Angeles Times oppose the ballot measure, calling it well-intentioned but unenforceable, and warning that it could drive up to 10,000 jobs out of state.

Very frequent testing makes it almost impossible for an actor to stay infected without being caught, said Dr. Jacques Pepin, the author of “The Origins of AIDS” and an expert on transmission rates. “And if you are having sex mostly with people who themselves are tested all the time, this must further reduce the risk.”

When the virus first enters a high-risk group like heroin users, urban prostitutes or habitués of gay bathhouses, it usually infects 30 to 60 percent of the cohort within a few years, studies have shown. The same would be expected in pornography, performers can have more than a dozen partners a month, but the industry says self-policing has prevented it..

“Our talent base has sex exponentially more than other people, but we’re all on the same page about keeping it out,” said Steven Hirsch, the founder of Vivid Entertainment, one of the biggest studios.

Performers have to test negative every 28 days, although some studios recently switched to every 14.

If a test is positive, all the studios across the country that adhere to standards set by the Free Speech Coalition, an industry trade group, are obliged to stop filming until all the on-screen partners of that performer, all their partners, and all their partners’ partners, are found and retested. In 2004, the industry shut down for three months to do that.

It has had briefer shutdowns in each of the last four years.

In 2009 and 2010, no other infected performers were found. Coalition representatives said an infected woman in 2009, from Nevada, may have had an infected boyfriend, and offered evidence that a man infected in 2010 in Florida had worked outside the industry as a prostitute. The 2011 test was a false positive.

A shutdown in August came after several actors got syphilis, not H.I.V. All performers were given a choice: Take antibiotics, or pass two back-to-back syphilis tests 14 days apart.

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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.

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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Benghazi Attack Raises Doubts About U.S. Abilities in Region

Esam Omran Al-Fetori/Reuters

The attack at the American Mission on Sept. 11, seen here, and an annex in Benghazi, Libya, points to a limitation in the capabilities of the American military command responsible for countries swept up in the Arab Spring.

WASHINGTON — About three hours after the American diplomatic mission in Benghazi, Libya, came under attack, the Pentagon issued an urgent call for an array of quick-reaction forces, including an elite Special Forces team that was on a training mission in Croatia.

The team dropped what it was doing and prepared to move to the Sigonella naval air station in Sicily, a short flight from Benghazi and other hot spots in the region. By the time the unit arrived at the base, however, the surviving Americans at the Benghazi mission had been evacuated to Tripoli, and Ambassador J. Christopher Stevens and three other Americans were dead.

The assault, on the anniversary of the Sept. 11, 2001, attacks on the United States, has already exposed shortcomings in the Obama administration’s ability to secure diplomatic missions and act on intelligence warnings. But this previously undisclosed episode, described by several American officials, points to a limitation in the capabilities of the American military command responsible for a large swath of countries swept up in the Arab Spring.

At the heart of the issue is the Africa Command, established in 2007, well before the Arab Spring uprisings and before an affiliate of Al Qaeda became a major regional threat. It did not have on hand what every other regional combatant command has: its own force able to respond rapidly to emergencies — a Commanders’ In-Extremis Force, or C.I.F.

To respond to the Benghazi attack, the Africa Command had to borrow the C.I.F. that belongs to the European Command, because its own force is still in training. It also had no AC-130 gunships or armed drones readily available.

As officials in the White House and Pentagon scrambled to respond to the torrent of reports pouring out from Libya — with Mr. Stevens missing and officials worried that he might have been taken hostage — they took the extraordinary step of sending elite Delta Force commandos, with their own helicopters and ground vehicles, from their base at Fort Bragg, N.C., to Sicily. Those troops also arrived too late.

“The fact of the matter is these forces were not in place until after the attacks were over,” a Pentagon spokesman, George Little, said on Friday, referring to a range of special operations soldiers and other personnel. “We did respond. The secretary ordered forces to move. They simply were not able to arrive in time.”

An examination of these tumultuous events undercuts the criticism leveled by some Republicans that the Obama administration did not try to respond militarily to the crisis. The attack was not a running eight-hour firefight as some critics have contended, questioning how an adequate response could not be mustered in that time, but rather two relatively short, intense assaults separated by a lull of four hours. But the administration’s response also shows that the forces in the region had not been adequately reconfigured.

The Africa Command was spun off from the European Command. At the time it was set up, the Pentagon thought it would be devoted mostly to training African troops and building military ties with African nations. Because of African sensitivities about an overt American military presence in the region, the command’s headquarters was established in Stuttgart, Germany.

While the other regional commands, including the Pacific Command and the Central Command, responsible for the Middle East and South Asia, have their own specialized quick-reaction forces, the Africa Command has had an arrangement to borrow the European Command’s force when needed. The Africa Command has been building its own team from scratch, and its nascent strike force was in the process of being formed in the United States on Sept. 11, a senior military official said.

“The conversation about getting them closer to Africa has new energy,” the military official said.

Some Pentagon officials said that it was unrealistic to think a quick-reaction force could have been sent in time even if the African Command had one ready to act on the base in Sicily when the attack unfolded, and asserted that such a small force might not have even been effective or the best means to protect an embassy. But critics say there has been a gap in the command’s quick-reaction capability, which the force would have helped fill.

A spokesman for the command declined to comment on how its capabilities might be improved.

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Google's Android software in 3 out of 4 smartphones

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Alabama No. 1 in AP Top 25 for 10th straight week

NEW YORK (AP) — After being tested for the first time this season Alabama and Oregon have held their spots at the top of The Associated Press college football poll.

A thrilling Saturday produced some great finishes but no upsets and few changes among the highest ranked teams.

Alabama, which scored late to beat LSU 21-17, is No. 1 for the 10th straight week. Oregon beat Southern California 62-51 and is No. 2 for the seventh consecutive week.

Kansas State remains at No. 3 after beating Oklahoma State 44-30, and Notre Dame stays at No. 4 after rallying to beat Pittsburgh 29-26 in triple overtime.

Ohio State and Georgia are tied for fifth.

No. 19 Texas and No. 24 Rutgers moved back into the rankings, and No. 23 Toledo is ranked for the first time since 2001.

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A Storm-Battered Supply Chain Threatens Holiday Shopping

The economic effects of Hurricane Sandy are reverberating beyond areas hit by the storm as businesses warn customers of delays, try to get merchandise out of closed ports and face canceled orders.

In addition to shutting down shipping terminals and submerging warehouses, the storm also tangled up deliveries because of downed power lines, closed roads and scarce gasoline in parts of New York and New Jersey.

The supply chain is backing up at a crucial time, just as retailers normally bring their final shipments into stores for the holiday shopping season, which retailers depend on for annual profitability.

“Things are slowing down,” said Chris Merritt, vice president for retail supply chain solutions at the trucking company Ryder. “This whole part of the supply chain is clogged up.”

FedEx, for example, has rented fuel tankers to supply its delivery trucks as commercial gas stations run dry. Ryder has been hunting down rental trucks to add capacity. CSX, the major railroad company, was continuing to advise customers to expect delays of at least 72 hours on shipments. And retailers ranging from Amazon to Diane von Furstenberg have told customers to expect delays on shipments.

Many economists expect the storm to shave up to half a percentage point from growth in the fourth quarter. That is a big reduction, with growth estimated to reach an annual rate of 1 to 2 percent before the storm, and the economy facing other significant headwinds, including fiscal uncertainty in Washington.

While economic losses from the storm are expected to be significantly lower than those from Hurricane Katrina in 2005, this storm’s impact has been intensified because the Northeast is densely populated.

The region is responsible for about $3 trillion in output, or roughly 20 percent of the country’s total gross domestic product, said Gregory Daco, a senior economist with IHS Global Insight. “Part of what was lost will be delayed, but part is lost forever,” Mr. Daco said.

Last week, the Port Authority of New York and New Jersey reported that all of its major marine terminals were closed by the storm. While parts of the system have started to reopen, delays persist. The New York area’s port system is the largest on the East Coast, and the third largest in the nation. Last year, it handled $208 billion in cargo.

As a result of the closings, delays may ripple through the holiday season, according to Paul Tsui, chairman of the Hong Kong Association of Freight Forwarding and Logistics. As of Sunday, almost all rail service from the ports was suspended, terminals were damaged and much of the ports’ equipment was being reviewed to see if it still worked.

Several customers with facilities in the New York area told him “their warehouses are totally damaged, and presume the merchandise inside will have to be reported lost to insurance companies,” Mr. Tsui said.

“We are now coming into the cutoff for seasonal orders for the Thanksgiving and Christmas holidays,” he added, and companies that missed shipment deadlines must either send products by expensive air freight, pay a penalty to retailers for late shipments or face canceled orders.

Mr. Merritt of Ryder said he expected that some items that have already been advertised for sales on the day after Thanksgiving — traditionally the busiest shopping day of the year — would not get to stores in time.

The delays are hitting smaller merchants like Robert Van Sickle particularly hard.

His pet supply company, Polka Dog Bakery, was relying on a shipment of cardboard tubes from China with a merry design, intended to hold popular holiday dog treats. The products represent about 15 percent of sales at the company. But the New York Container Terminal in Staten Island, where the tubes arrived shortly before the storm, was devastated, and Mr. Van Sickle’s freight forwarder has been unable to track down the containers.

It is too late to reorder the tubes from China in time for the holidays, and Mr. Van Sickle has tens of thousands of baked dog treats piled up at his Boston headquarters. Insurance will cover the cost of the cardboard tubes, but not the finished products, and those payments will not come close to making up for lost revenue.

Last week, he was forced to call customers like L.L. Bean and tell them he probably could not fulfill their orders. “Without this product, we’re in trouble,” Mr. Van Sickle said. “I am a business owner and this is pretty much my year.”

In Cape May, N.J., Rich Layton’s six-week-old start-up, Layton Sports Cards, was supposed to be shipping sports card orders all week. But his apartment partially flooded, his Allentown distributor could not find clear roads to get to him, and U.P.S. held his other deliveries during the storm.

“It’s thousands of dollars worth of cards that people were already paying for,” Mr. Layton said.

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