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The recently agreed tax cuts in the U.S. will help Europe’s economic recovery pick up some steam this year despite rising energy costs and debt troubles in a number of countries that use the euro, the EU’s executive said Tuesday.

However, inflation is also on the rise amid sky-high oil prices due to the turmoil sweeping across the Middle East and North Africa, the European Commission warned.

In the latest projections, economic growth in 2011 is expected to be somewhat stronger than anticipated last autumn as Europe’s larger exporting nations enjoy better demand from the U.S. _ at the end of last year, the Obama administration and Republicans in Congress agreed to extend Bush-era tax cuts and unemployment benefits.

“Global growth in 2011 is being revised up, mainly on the back of the additional fiscal stimulus adopted in the U.S. in December,” the Commission said. “The improved environment for the external environment will provide a boost to EU exports, particularly in the more export-oriented economies.”

But while countries like Germany are enjoying the fruits of an improved global economy, others like Spain continue to lag behind as their governments enact harsh austerity measures, such as higher taxes and spending cuts, in an attempt to get a handle on their perilous debt situation.

For the 17-country eurozone, the Commission is forecasting growth of 1.6 percent this year, 0.1 percentage point higher than previously thought. The Commission raised its 2011 forecast for the wider 27-nation EU, which includes non-euro members such as Britain and Poland, by 0.1 percentage point to 1.8 percent.

The eurozone’s recovery from recession has also shown signs of helping the labor market. Eurostat, the EU’s statistics office, reported Tuesday that unemployment in the eurozone fell to 9.9 percent in January. That’s the first time the rate has been below 10 percent since last March.

But while unemployment is showing tentative signs of falling, inflation is on the rise. Eurostat said consumer prices rose 2.4 percent in the year to February, 0.1 percentage point higher than the previous month.

The figure may have been in line with market expectations but inflation is running at its highest level since November 2008 and remains above the European Central Bank’s target of keeping price increases “close to but below” 2 percent.

Though the rise in inflation is unlikely to prompt the ECB to raise its main interest rate from the current record low of 1 percent when it completes its monthly policy meeting on Thursday, a number of rate-setters are getting jittery and the markets are now pricing in the probability of higher borrowing costs towards the end of this year.

The Commission revised its inflation projections up markedly following the recent surge in energy and commodity prices. It now expects inflation in the eurozone in 2011 to be 2.2 percent, instead of 1.8 percent previously.

The Commission noted that the economic slack left over by the deepest recession since World War II, subdued wage growth and well-anchored inflation expectations will keep underlying price pressures in check.

However, much will hinge on developments in the Middle East and North Africa after uprisings in Tunisia and Egypt brought down longtime leaders and unrest in Libya threatens to end the regime of Moammar Gadhafi.

“Should geopolitical tensions spread further in the region, disruptions to oil supply could not be excluded, fueling oil-price increases beyond what is assumed in this forecast,” the Commission said.

In its forecasts for 2011, the Commission is predicting average oil prices of just over $100 a barrel, up from around $80 a barrel in 2010. At the moment, Brent crude in London is trading at a little over $112 a barrel while the New York equivalent, having breached $100 last week, is back down around the $97 mark.

Olli Rehn, Europe’s commissioner for monetary affairs, sought to downplay the impact of higher oil prices on the economic recovery, noting that the increases witnessed so far are not hugely damaging.

“Yes, it has an impact, but with these oil prices … it is still relatively low in Europe,” Rehn said in a press briefing following the publication of the Commission forecasts.

However, if oil prices rise to $200 a barrel, which many analysts think is possible if Saudi Arabia becomes embroiled in the crisis sweeping the Arab World, then the global economy could come to a standstill or fall back into recession.

Rehn noted that a 10 percent increase in the oil price knocks off around 0.1 percentage point off growth in Europe.

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Eurozone finance ministers have decided to provide a permanent crisis mechanism that will come into action in 2013 with euro500 billion (674 billion).

Jean Claude Juncker, who chairs the regular meetings of the 17 eurozone finance ministers, says the ministers “agreed on the provisional volume of euro500 billion, which will be revised every other year.”

Juncker says additional financing will be provided by the International Monetary Fund.

The so-called European Stability Mechanism will succeed the European Financial Stability Facility, the eurozone’s current bailout fund, in 2013.

Ministers didn’t reach a decision on boosting the size of the current facility.

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The old St. Louis Globe-Democrat began the Man of the Year award in 1955. The Post-Dispatch took sponsorship in 1988. A committee of former winners renamed the award Citizen of the Year in 1997.

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Total SA says its quarterly profit slipped 2 percent on flat production and higher write-offs of refining assets even as the oil price surged.

The French oil company says it made euro2.03 billion ($2.8 billion) in the October to December quarter, down from euro2.07 billion a year earlier.

Europe’s third-largest oil company says in a statement Friday that its combined output of oil and gas was stable at 2.4 million barrels a day in the fourth quarter, as higher oil prices led to a decline in the amount of oil Total was entitled to under production sharing agreements with governments of oil producing nations.

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ask the expert

Marc Lopata, chief operations officer

Microgrid Energy

314-657-0955

MLopata@MicrogridEnergy.com

Considering tax law provisions for 2011, is this a good time to install a solar energy system?

Missouri sunshine combined with a package of federal, state and utility incentives makes this a terrific time to install solar. It’s also a good time to take a look at a business’ overall energy performance.

The 2010 tax-cut extension bill allows for faster depreciation and a higher, earlier after-tax cash flow for a new solar energy system.

At the state and utility levels, rules enacting Proposition C, which Missouri voters overwhelming approved two years ago, are scheduled to go into effect this month. The proposition requiring utilities to get some of their energy from renewable sources further improves the business case for solar and keeps Missouri revenue in Missouri easy pay day loans.

An investment in solar for profitable businesses with good credit can deliver positive cash flow every year, shorten the payback period, increase net operating income and produce a double-digit internal rate of return. Combine solar, other renewables and energy efficiency into a corporate energy strategy, and a company can have tools to help manage risk and improve financial performance.

Ameren Missouri rates rose more than 20 percent last year and will continue to go up. No longer is the cost of energy incidental to a company’s profit and loss.

Small firms to the St. Louis Cardinals

Sales perk up in December

House sales in the 11-county region picked up 5 percent in December compared with December 2009, their first month of growth since May.

Dec. ‘09 Dec. ‘10 Change St. Louis County 802 832 3.74%

St. Charles 248 315 27.02%

St. Louis city 212 179 -15.57%

St. Clair 170 173 1.76%

Madison 168 156 -7.14%

Jefferson 114 139 21.93%

Franklin 72 69 -4 payday loans.17%

Lincoln 30 39 30.00%

Warren 29 29 0.00%

Monroe 21 25 19.05%

Clinton 14 18 28.57%

Total 1880 1974 5.00%

Source: MARIS, Realtors Association of SW Illinois, Kelsey Cottrell Realty, Greater Gateway Realtors Association

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A local factory worker has sued Washington University in St. Louis, accusing the university’s doctors and other Missouri health care providers of routinely and illegally over-billing for medical services.

The suit, which seeks class-action status, was filed Friday in the Circuit Court of the city of St. Louis. It asks for actual and punitive damages based on allegations that thousands of insured patients have sustained financial losses and damages as a result of such billing practices.

Specifically, the suit contends that “balance billing,” which most state health care providers use, violates the Missouri Merchandising Practices Act, which deals with consumer fraud and forbids deceptive and unfair practices.

In “balance billing,” a health care provider bills the patient directly for the difference between what a health insurance carrier is willing to pay and the total amount charged by a hospital, doctor’s office or laboratory. The suit contends that Washington University and other providers charge exorbitant prices to patients for “out of network” care, not fully covered by their insurance policies. At its core, the suit challenges the common practice by health providers of charging different prices depending on whether individuals, insurance companies or the government is paying the tab.

“Health care providers should have a flat, set fee for their services, rather than charging different amounts depending on who is responsible for payment,” said plaintiff’s attorney Paul Passanante. “I believe that a jury of 12 people would find that a situation in which the charges for services varies depending on who is responsible for payment constitutes price gouging because it’s discriminatory and unfair.”

Washington University spokeswoman Joni Westerhouse said the college had just received the suit and could not comment. The university’s medical school provides health care services.

Westerhouse said she was not certain whether the university charged different amounts for the same services to Medicare patients, uninsured patients and insured patients who receive care from either pre-authorized “in network” providers and “out of network” providers.

Friday’s petition was filed on behalf of Steven Powell, of St. Louis, an insured patient who was hospitalized in 2008 at Barnes-Jewish Hospital. The hospital’s owner and Washington University, which supplies doctors to Barnes-Jewish, subsequently sued Powell when he refused to pay charges not covered by his insurance carrier payday loan.

The apparent test case names Washington University as “a fair and adequate representative of all the health care providers in the state of Missouri which utilize this unlawful billing practice.”

According to the suit, health care providers often set prices for services that are higher than the charges it has agreed to accept from insurance companies, Medicare and uninsured patients.

Such cost-shifting practices, Passanante said, result in some patients’ having to subsidize the losses incurred by hospitals and health care providers, who are paid less for Medicare and uninsured patients.

He said the practice also called into question whether insurance companies were paying fair rates to providers. “My health insurance carrier has agreed with me to pay health care providers a fair and reasonable amount for the services provided,” he said. “If my health insurance carrier has provided payment in a fair and reasonable amount, why would a health care provider ever be entitled to more than that?”

Greg Thompson, a spokesman for United HealthGroup Inc. in Chicago, said that billing practices varied because some patients had out-of-network benefits and others did not.

“We would encourage that people read and understand what their insurance policy covers and what it does not,” he said, ’so that they’re fully informed, and they can ask their physician appropriate questions about their coverage.”

But patients are not always consulted on their providers. For instance, some laboratories, anesthesiologists and pieces of equipment chosen by in-network providers may not be fully covered by health insurance plans.

“Generally speaking, if you pursue out-of-network care, your insurance is going to pay a portion of your costs but not likely the whole bill,” said Scott Larrivee, a spokesman for Anthem Blue Cross and Blue Shield. “You, the individual, would have to pay the remainder of that bill.”

“When you’re seeking voluntary care, you’re definitely going to want to ask these questions in advance of your surgery, or whatever, to make sure you know what coverages you have and what the expectations are,” he said. “If it’s an emergency situation, we will take a look at those factors.”

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A swollen river submerged bridges and inundated homes and stores Sunday in Australia’s already sodden Queensland state as more heavy rain added to the country’s worst flooding in decades.

Maryborough became the latest of some 40 towns to be partly awash as a river running through it burst its banks and entered parts of the town of 22,000, which has been heavily protected by sandbags and levies. Downstream, residents of Gympie were frantically sandbagging their town in anticipation of flooding there on Monday.

The latest flooding was not as bad as in recent weeks, when entire towns were submerged beneath an inland sea the size of France and Germany combined, but was a sign that the ground has little capacity left to soak up any more moisture, so any new rain is likely to make matters worse, officials said.

Some areas of Queensland have had more than eight inches (200 millimeters) of rain the past 24 hours, the Bureau of Meteorology said late Sunday.

“This year, with all of the catchments primed and the rivers already flooding, that 200 millimeters of rain will mean something very different,” said Warren Bridson, acting chief of the state emergency services. “It could mean the difference between a minor flood and a major flood.”

Ten people have died since late November and about 200,000 have been affected by the floods. Roads and rail lines have been cut, Queensland’s big-exporting coal mine industry has virtually shut down, and cattle ranching and farming across a large part of the state are at a standstill.

Towns in the path of floodwaters have had time to prepare with sandbags and levies, and officials say the rain falling now is not expected to make the crisis significantly worse. A massive relief operation has moved from emergency operations to recovery.

Residents of some of the 40 affected towns have returned home and begun mopping up sludge left behind by the floods, while others _ including in the city of Rockhampton, home to 75,000 people _ are still waiting for floodwaters to recede to start the cleanup.

Officials say it will be another week before the river level drops, and the situation will stay miserable in the meantime for many people, with dirty water sloshing through 400 homes and 150 businesses.

“The issue of the stench, the question of the mosquitoes, sand flies and black flies … will be very uncomfortable to our community,” Rockhampton Mayor Brad Carter said.

Senior officials got a personal dose of the bad weather on Sunday, when a small plane carrying the army officer in charge of the rebuilding effort, the state premier and other officials was hit by lightning. It sent a flash of light through the cabin and left black scorch marks on both wing tips and the tail, the premier’s office said.

In Maryborough, two houses, a mobile home park and about seven businesses near the river were inundated, and two bridges were covered with water as the floods peaked, police Superintendent Stephen Wardrope said.

A Gympie official, Tony Perret, said the floodwaters were headed toward the town, and some properties close to the river were expected to be inundated Monday.

Prime Minister Julia Gillard flew Saturday to several towns that were cut off or partly submerged by floodwaters, and promised residents they would be fully restored. Maj. Gen. Mick Slater, who is in charge of the recovery operation, said it might take years to fix all the damaged roads, rail lines and bridges.

Queensland officials have said the price of rebuilding homes, businesses and infrastructure, coupled with economic losses, could be as high as $5 billion.

Australia’s worst flooding in some 50 years was caused by tropical rains that fell for days, starting just before Christmas. Some 1,200 homes were inundated and almost 11,000 more have water damage. Nearly 4,000 people were evacuated, and many are still staying with friends or in relief shelters.

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Regulators on Friday shut down small banks in Michigan and Pennsylvania, boosting the number of U.S. banks that have failed this year to 151 as bad loans have mounted and the economy has been slow to heal.

The Federal Deposit Insurance Corp. took over Paramount Bank, based in Farmington Hills, Mich., with $252.7 million in assets and $213.6 million in deposits; and Earthstar Bank, based in Southampton, Pa., with $112.6 million in assets and $104.5 million in deposits.

Level One Bank, based in Farmington Hills, Mich., will assume the assets and deposits of Paramount Bank; Polonia Bank, based in Huntingdon Valley, Pa., is assuming all the deposits and $77.1 million of Earthstar Bank’s loans and other assets.

In addition, the FDIC and Level One Bank agreed to share losses on $233.1 million of Paramount Bank’s assets. The agency and Polonia Bank are sharing losses on $45.8 million of Earthstar Bank’s assets.

The failure of Paramount Bank is expected to cost the deposit insurance fund $90.2 million; that of Earthstar Bank is expected to cost $22.9 million.

The 151 closures nationwide so far this year tops the 140 shuttered in all of 2009 and is the most in a year since the savings-and-loan crisis two decades ago. By this time last year, regulators had closed 133 banks.

The 2009 failures cost the insurance fund about $36 billion; the failures so far this year have cost around $21 billion, less because the banks failing in 2010 have on average been smaller. Twenty-five banks failed in 2008, the year the financial crisis struck with force; only three succumbed in 2007.

The growing bank failures have sapped billions of dollars out of the deposit insurance fund. It fell into the red last year, and its deficit stood at $8 billion as of Sept. 30.

The number of banks on the FDIC’s confidential “problem” list jumped to 860 in the third quarter from 829 three months earlier, even as the industry as a whole made $14.5 billion in net income. The 860 troubled banks is the highest number since 1993, during the savings-and-loan crisis.

The FDIC expects the cost of resolving failed banks to total around $52 billion from 2010 through 2014.

Depositors’ money _ insured up to $250,000 per account _ is not at risk, with the FDIC backed by the government. That insurance cap was made permanent in the financial overhaul law enacted in July.

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