Salvation Army, which raised more than $60 million to help victims of Sept 11 terrorist attacks, has been overwhelmed by response to its simple idea of providing immediate, practical assistance by paying household bills; agency's technology and processing and printing out checks could not keep up with bills pouring in, and thousands of families have now discovered their rent, car payments and other expenses were not paid at all; agency has received more than 30,000 bills from some 8,000 families, avalanche of paperwork that swamped limited personnel and quaint check-writing equipment; photo; official Alfred J Peck Jr comments on embarrassment (M)

Charity Overwhelmed in Bid To Meet Attack Victims' Bills

Shares of Conseco Inc drop 16 percent after resignation of Conseco Finance president Bruce A Crittenden and after Salomon Smith Barney analyst Colin Devine issues negative report on company's prospects; Crittenden is succeeded by Charles H Cremens; Conseco spokesman Mark Lubbers says decline in stock is linked to Devine's report (M)

Conseco Shares Slide on News Of Rating Drop And Departure

Profile of and interview with Paul Pierce, who has gotten NBA's attention this season with his strong play for Boston Celtics; photo (M)

Pierce Finds New Life in His Game

William C Rhoden, in Sports of The Times, contrasts old University of Miami football team, which was boisterous and rowdy, with 'new,' more respectable Miami; photo of coach Larry Coker (M)

Sports of The Times; It's Difficult To Forget Old Miami

University of Miami coach Larry Coker accepts four trophies to signify various national championships of college football; coaches vote Miami the champion; they are under this obligation in poll conducted by ESPN and USA Today because Hurricanes won Bowl Championship Series title game; news media also names Miami champion in Associated Press poll after Hurricanes surge to 34-0 lead in first half; New York Times computer ranking also puts Hurricanes on top; photo; table (M)

Hurricanes Enjoy the Spoils That Go to the Champions

About 20 police detectives and agents from New York City Finance Dept go to National Arts Club on Gramercy Park South to execute search warrant as part of investigation into possible grand larceny and tax evasion; remove 40 boxes of files; scene is culmination of long-running fight between club's president, O Aldon James Jr, and disgruntled members and Gramercy Park property owners who have accused James of misappropriating funds, charge that he denies; photo (M)

Records Seized in Investigation at National Arts Club

Raymond W Kelly is sworn in for second turn as New York City police commissioner; officials say Kelly will create high-level position within department to oversee city's response to terrorism threats and is creating policy to make city's homeless shelters safer; Mayor Michael R Bloomberg comments; photo (M)

Kelly Focuses On City Defense And Bolstering Shelters' Safety

Nearly 3,500 Taliban prisoners have been held for month in Shibarghan prison built for 800, raising concern of aid groups; photo; prisoners are being interrogated by US, but jailer is Gen Abdul Rashid Dostum, Afghanistan's new deputy defense minister and ethnic Uzbek warlord with long reputation for brutality; Red Cross reports dozens of dysentery cases; other Taliban and Al Qaeda fighters are imprisoned in Kohat, Pakistan, where locals are complaining of mistreatment; US officer at Shibarghan says he has not been inside prison, but that interrogators are processing prisoners as quickly as possible, treating them with dignity (M)

Prison Packed With Taliban Raises Concern

Investigators looking into crash of American Airlines flight in Queens in November have so far found no pre-existing flaw in jet's tail section and are now focusing on performance of pilots, who they believe triggered plane's wild rolling and yawing in seconds before it went down; data recovered from American Airlines Flight 587 show that plane hit turbulence from plane in front of it and seconds later began to swing violently and break up; photo (M)

Crash Inquiry Is Focusing On the Pilots

Army Special Forces sergeant Nathan Ross Chapman, 31, is killed in brief firefight in eastern Afghanistan, first death of US serviceman by hostile fire since war began nearly three months ago; CIA officer is wounded; ambush happens after small team of Americans and Afghans meets with local leaders near Khost and Gardez to try to get information about Al Qaeda locations; Gen Tommy Franks warns much dangerous work remains to be done; US planes bomb Al Qaeda training camp in province; Pentagon reports Al Qaeda regrouping at compound; Khost area is filled with bandits, renegade Taliban and die-hard Al Qaeda; speculation noted about whereabouts of Osama bin Laden (M)

HOSTILE FIRE KILLS FIRST U.S. SOLDIER SINCE WAR'S ONSET

Three Kings Day Parade is held in East Harlem; event, sponsored by El Museo del Barrio, this year honors heroes of World Trade Center and Flight 587 disasters; photos (S)

A Day for Wise Men And Grateful Hearts; Parade in East Harlem Pays Tribute To Heroism in the Face of Disaster

Steve Spurrier, who in his dozen years as head coach at University of Florida led Gators to national championship and six Southeastern Conference titles, resigns, saying he feels that his coaching career is complete; acknowledges that he is interested in pursuing job in NFL; photo (M)

Spurrier Resigns As N.F.L. Beckons

Article in Times Magazine Jan 6 noted; photo

Editors' Note; COMING ON SUNDAY

Chinese are trying to supplant India in software industry; few weeks ago, delegation of officials from Chinese Ministry of Higher Education was in Bangalore, India, at Infosys Technologies, India's best-known technology company, on mission to learn how India holds edge in industry; Chinese, realizing that part of India's advantage comes from its schools and universities, visited many centers of education while in India; Chinese have engineering and technology schools that they consider just as good, if not better than, those in India; in fiscal year ended March 31, 2001, India exported software to more than 100 countries, but significant 60 percent of its software exports went to US alone; in 2000-01, India's software exports totaled $6.2 billion; China's software exports were only $130 million in 1999 and have yet to reach $1 billion; photos (M)

Chinese Race to Supplant India in Software

 Nasdaq Increases 5.6% In First Days of New Year  The Nasdaq composite index has climbed 5.6 percent in the first three days of trading this year, as investors buy on the belief that technology purchases will fuel the economic recovery. The Nasdaq composite index rose 15.11 points yesterday, or 0.7 percent, to 2,059.38. Since their lows of Sept. 21, technology stocks have gained more than 44 percent.    The Dow Jones industrial average closed up 87.60 points, or 0.9 percent, at 10,259.74, providing a gain of 1.2 percent for the week. The Standard & Poor's 500-stock index rose 7.24 points, or 0.6 percent, to 1,172.51, and was up less than 1 percent for the week. [Page C4.]

BUSINESS DIGEST

Icy night in Mineapolis finds dozens of homeless men waiting at St Stephen's Roman Catholic Church for nightly lottery that determines who gets beds and meals at three church-sponsored shelters; photos; graph; Minnesota, unlike New York, offers no legal right to shelter and few county-run places are largely limited to welfare recipients (M)

On an Icy Night, Little Room at the Shelter

 This Time, No Bailout  Seven years ago President Clinton ordered a huge bailout of Mexico when it was near default. President Bush, who supported Mr. Clinton, offered nothing to Argentina when it barreled toward default.   PAGE A3    Jobless Rate Reaches 5.8%  The unemployment rate rose two-tenths of a percentage point, to 5.8 percent in December, a level it last reached in April 1995. But fewer Americans lost their jobs than in the prior three months.   PAGE C1

INSIDE

Sen Tom Daschle accuses Pres Bush and Republicans of causing 'most dramatic fiscal deterioration' in US history by pushing through major tax cut last year; praises Bush's leadership in war against terrorism but says domestic policy is written by Republican wing that is not interested in fiscal discipline and seeks tax cuts for the most affluent as solution to every problem; blames tax cut for dwindling surpluses, high long-term interest rates and erosion of investor confidence; speech opens fierce election-year struggle over weak economy; Bush adviser Karen Hughes and chorus of Republicans shoot back with barrage of accusations that Daschle wants to raise taxes by repealing cuts; Daschle appears with Clinton administration officials Robert Rubin and Leon Panetta as he contrasts Clinton and Bush policies (M)

Democrat Assails Bush on Economy

AT&T plans to lay off 5,000 employees in 2002; lay offs will take place in business, consumer and corporate units; company will take charge of about $1 billion, before taxes, in fourth quarter of 2001 to cover costs of these layoffs and costs of having already dismissed 5,100 employees (M)

AT&T Plans To Lay Off 5,000 Workers

Israeli army seizes ship carrying 50 tons of rockets, mines, antitank missiles and other munitions intended for Yasir Arafat's Palestinian Authority, even as US envoy Gen Anthony Zinni meets with Arafat in hope of strengthening his declared cease-fire; photo of weapons; Palestinian officials deny link to ship, Karine A, with Israel says is owned by Palestinian Authority and has Palestinian naval police as captain and crew; Zinni focuses on getting peace talks going; US acknowledges role in tracking ship, which is boarded in Red Sea by Israeli commandos; most of equipment on board is from Iran (M)

Israel Seizes Ship It Says Was Arming Palestinians

Free-agent outfielder Juan Gonzalez is considering offers from Baltimore Orioles, Texas Rangers and New York Mets (M)

Rangers or the Mets? It's Up to Gonzalez

Nation's Unemployment Rate Rises to 5.8%

Pressure is building against handful of powerful companies that have prospered for years as middlemen between drug manufacturers and those who pay for medicines; companies, called pharmacy benefit managers, administer drug plans for some 200 million Americans and play critical role in determining which drugs people take for different ailments; large corporations and major public employers say pharmacy benefit managers have not done enough to stem rapid growth in national spending on prescription drugs, which narly tripled in last eight years from $50 billion in 1993 to $150 billion last year; consumrs and employers have filed lawsuits against several pharmacy benefit managers, claiming that they inflate drug costs for some customers and violate their duty to act in best interest of customers; pharmacists in dozen states are pressing for laws that would tighten regulatory oversight of pharmacy benefit managers; critics say pharmacy benefit management companies negotiate deals with drug makers that benefit themselves and drug companies more than anyone else; suits have been filed against Merck-Medco, Express Scripts and AdvancePCS; Peter E Shumlin, president of Vermont Senate and chairman of Northeast Legislative Association on Prescription Drug Prices, comments; chart; photo (M)

Drug Middlemen Are Facing Pressure Over Rising Prices

Because of an editing error, a front-page article on Dec. 16 about the rising prices of books omitted necessary words in a comment from Stephen Rubin, publisher of the Doubleday Broadway group at the Random House division of Bertelsmann. The error was repeated in the Economic Scene column on Thursday. Mr. Rubin's quotation, with the omitted passage shown in brackets, was: ''I am just convinced that there is no difference between $22 and $23. Let's face it[, if you want a book in translation from a Czech writer, you are going to buy the book] -- price is not a factor if it is a book that you really want.''

Corrections

Correction of Jan 4 review of television program Sins of the Father; Bobby Frank Cherry has been found mentally competent to stand trial in murder of four black girls in Birmingham church in 1963

January 5, 2002

Headlines from January 5, 2002

Charity Overwhelmed in Bid To Meet Attack Victims' Bills

Conseco Shares Slide on News Of Rating Drop And Departure

Pierce Finds New Life in His Game

Sports of The Times; It's Difficult To Forget Old Miami

Hurricanes Enjoy the Spoils That Go to the Champions

Billboard 200

Weathered

Now 8

Scarecrow

Britney

A Day Without Rain

Historical Context for January 5, 2002