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* * * * * * FRIDAY, MARCH 21, 2014 ~ VOL. CCLXIII NO. 66 WSJ.com HHHH $2 .00

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TODAY IN MANSION

Landlords of the ManorARENA The Search for the Perfect Playlist

CONTENTSBooks............................... D6Corporate News... B2-4Global Finance............ C3Heard on the Street C12In the Markets........... C8Music............................ D2,7

Opinion................... A11-13Sports........................... D10Technology................... B5Theater....................... D8,9U.S. News................. A2-5Weather Watch........ B6World News..... A6-9,14

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What’sNews

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World-WidenTheU.S. imposed sanctionson a high-profile Russian bankand some Putin backers in re-sponse to the annexation ofCrimea.Moscow shot backwithpenalties of its own. A1, A6-7n Search teams resumedscouring an area of the IndianOcean for possible debris fromthe Malaysian jet after a satel-lite sighted potential clues. A9nThe Taliban attacked a po-lice base in eastern Afghanistanand a luxury hotel in Kabul,killing at least 11 and raisingpre-election security fears. A8nAn Army general accusedof sexual assault before plead-ing guilty to a lesser chargewas reprimanded and orderedto forfeit $20,000 in pay. A3nTheWhite House canceledplans for a summit with PersianGulf monarchs due to splitsamong theMideast nations.A8nTurkey’s Internetwatchdogblocked Twitter in an apparentbid to silence criticism of thepremier ahead of elections.A8n Radioactive waste fromNew Mexico’s Los Alamos labwill be stored temporarily ata private dump in Texas. A3nSouth Sudan recaptured akey oil hub, endingmore than amonth of rebel occupationamid faltering truce efforts.A9n An Indian court convictedfour men for committing thegang-rapes of two women. A8nUruguay is in talkswith theU.S. about receiving five Guan-tanamo Bay detainees.A9nDied: LawrenceWalsh, 102,Iran-Contra prosecutor.A4…PatrickMcGovern, 76, tech-nology-magazine publisher. B4

i i i

Wages are booming in afew hot segments of the

economy, but the gains mask ableak picture for incomes ofmost American workers. A1nAirbnb is in talks to raisecapital that would value theonline lodging service, whichlets people rent their homes totravelers, at some $10 billion.A1n Existing-home sales fellagain in February, the latestsign severe weather andsoaring prices are undermin-ing the housing recovery. A2n U.S. stocks rallied on up-beat factory-activity data. TheDow climbed 108.88 pointsto 16331.05. The S&P 500 andNasdaq also advanced. C8n The Fed “stress tests”found that 29 of the 30 larg-est banks could withstand asevere economic downturn. C1nA top portfolio manager atSAC Capital is planning toleave the hedge fund by year-end to start his own firm. C1n Symantec fired its CEO, thesecond time the software com-pany has dumped its top exec-utive in under two years. B1nU.K. officials accused an ex-Credit Suisse trader of tryingto sell bonds to the Bank ofEngland at inflated prices. C1nExxon agreed to disclosehow the regulation of carbonemissions could affect the valueof its oil and gas holdings. B1nMt. Gox said it found nearlya quarter of the bitcoins itpreviously said were lost. C2nTheWhite House is testingSamsung and LG smartphones,threatening BlackBerry. B1

Business&Finance

Wages are booming in someof the hottest segments of theeconomy, but those gains aremasking an otherwise bleak pic-ture for American incomes fiveyears after the recession ended.

In Florida, plumber BobbyBenson just got a 15% raise as asurge in home building drivesdemand for skilled labor. Oil-services company RPC Inc.boosted wages by 15% to 20% ina year to lure workers to a smalltown in North Dakota. ThomasLyng, a trucker in Buffalo, N.Y.,earned 10% more last year amida driver shortage.

Workers in these blue-collar,largely skilled fields are the out-liers. They are able to commandtop pay because of shortages ofqualified workers and, in somecases, a willingness to take de-manding jobs in remote areas.Their income success contrastswith inflation-adjusted wagesthat rose just 1.1% in the 12months through February, LaborDepartment data showed thisweek.

Chances of the recovery kick-ing into a higher gear rest heav-ily on the ability of workersacross more industries to securewage gains. Stagnant incomeshave restrained the Americanconsumer for years, creating avicious circle that has left busi-nesses waiting for strongerspending before they rev up hir-ing and investment.

Federal Reserve officials aremonitoring wage measures par-ticularly closely to gauge thehealth of the economy and guideinterest-rate policy. Wages arecurrently “signaling weakness inthe labor market,” Fed Chair-woman Janet Yellen told report-ers Wednesday after the centralbank’s policy meeting.

“It’s been a painfully longprocess of reparation,” said Mor-gan Stanley economist EllenZentner. Falling unemploymenteventually should spur broad-based wage gains, she said. “Astime goes on, slack gets less andless and upward pressure onwages develops.”

That already is happening inhome building. The industrystarted rebounding in 2012 aftershedding more than 465,000

Pleaseturntothenextpage

BY JONATHANHOUSE

UnevenWagesRestrainRecovery

The U.S. raised the stakesThursday in its confrontationwith Russia over Crimea, aiminga new round of sanctions closerto Russian President VladimirPutin and his inner circle even asMoscow struck back with penal-ties of its own on U.S. lawmakersand White House officials.

The Obama administration’smore aggressive move—target-ing a high-profile Russian bankas well as some of Mr. Putin’s

wealthiest and most influentialsupporters—increased the likeli-hood the retaliation could spiral.

It also marked a notable re-versal for a White House thatuntil last month saw Mr. Putinand his government as a vital in-ternational partner.

Moscow has vowed an “asym-metrical” response that couldencompass global issues impor-tant to the U.S., such as the Irannuclear talks. U.S. officials saidearlier that they were preparedfor a Russian move to constrictsupply routes used by the U.S.that pass near and through Rus-sian territory.

But although the deepeningstandoff has redefined a key seg-ment of Mr. Obama’s foreign pol-

icy—his “reset” with Russia—ithasn’t ended it, officials said.The administration still consid-ers Russia an important playerin global issues, but has begunbracing for a different tenor inthe relationship.

“Putin is the ultimate decisionmaker,” a senior official said.“You can’t be done with him.”

The Kremlin on Thursday saidit is evaluating the new U.S.sanctions, which came after a

first batch on Monday. Mean-while, Moscow responded toMonday’s initial sanctions bynaming six U.S. lawmakers andthree White House officials to ablacklist of its own, barringthem from traveling to Russia.

The European Union, mean-PleaseturntopageA6

By Carol E. Lee,Gregory L. White

and Jared A. Favole

U.S. Trades Sanctions With RussiaWashington Acts to Bring Crimea Penalties Closer to Putin as Moscow Strikes Back; EU Adds Targets

EL DORADO SPRINGS, Mo.—The owner of the nicest restau-rant in town doesn’t serve alcohol,worried that his pastor would bedisappointed if he did. Publicschools try to avoid schedulingevents on Wednesday evenings,when churches hold Bible study.And Democrats here are a rareand lonely breed.

Older, nearly 100% white andoverwhelmingly Republican, ElDorado Springs is typical of whatis now small-town America. Cof-fee costs 90 cents at the diner,with free refills. Two hours northand a world away in Kansas City,Starbucks charges twice that, andvoters routinely elect Democrats.

There have always been differ-ences between rural and urbanAmerica, but they have grownvast and deep, and now are an un-derappreciated factor in dividingthe U.S. political system, say poli-

ticians and academicians.Polling, consumer data and de-

mographic profiles paint a pictureof two Americas—not just withdiffering proclivities but differentlife experiences. People in citiesare more likely to be tethered to a

smartphone, buy a foreign-madecar and read a fashion magazine.Those in small towns are morelikely to go to church, own a gun,support the military and valuecommunity ties.

In many ways, the split be-

tween red Republican regions andblue Democratic ones—and theiropposing views about the role ofgovernment—is an extension ofthe cultural divide between ruralAmericans and those living in cit-ies and suburbs.

As Democrats have come todominate U.S. cities, it is Republi-can strength in rural areas that al-lows the party to hold control ofthe House and remain competitivein presidential elections.

“The difference in this countryis not red versus blue,” said NeilLevesque, director of the NewHampshire Institute of Politics atSaint Anselm College. “It’s urbanversus rural.”

El Dorado Springs, the largesttown in Cedar County, is in Re-publican country. Cedar Countygave 72% of its votes to Mitt Rom-ney in 2012.

The town sits in Missouri’sfourth congressional district, rep-resented in the House of Repre-

PleaseturntopageA10

BY LAURA MECKLERAND DANTE CHINNI

CITY VS. COUNTRY

HowWhere We Live DeepensThe Nation’s Partisan Split

Airbnb Inc., which once soldnovelty cereal boxes to stayafloat before emerging as athreat to the hotel industry, isclose to becoming one of theworld’s most valuable startups.

The online service that letspeople rent their homes to trav-elers is in advanced talks toraise capital that would value itat about $10 billion, according topeople familiar with the matter.

Private-equity firm TPG andboutique investment firm Drag-oneer Investment Group are

leading the funding round, whichcould total between $400 millionand $500 million, these peoplesaid. Mutual funds including T.Rowe Price Group Inc. are ex-pected to be part of the invest-ment group, the people said. Fi-delity Investments is also indiscussions to join the group,the people said.

The negotiations between thevarious investment groups andAirbnb remain fluid and could fallapart, these people cautioned.

The rich price tag reflectsAirbnb’s potential to disrupt thehotel industry. In six years, thecompany has become a requireddestination for millions of tour-

PleaseturntopageA5

By Evelyn M. Rusli,Douglas MacMillanand Mike Spector

ValueofSiteThatTurnsHomesIntoHotels Nears $10Billion

Source: WSJ analysis of Census Bureau data The Wall Street Journal

AHouse DividedOver the past 15 years the percentage of rural Americans representedby Republicans in the House has grown sharply, while urban Americanshave shifted slightly to House Democrats.

Rural Urban100

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25

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75

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100

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25

50

75

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’831972 ’93 ’99 2013

Democrats

Republican

Let the Madness Begin

BRACKET-BUSTERS: College basketball’s championship tournament began with immediate upsets. Above, a No. 11 seed, Dayton, after knocking outa No. 6, Ohio State. North Dakota State stunned Oklahoma and Harvard dumped Cincinnati. Coverage of the chaos on D10 and at WSJ.com/Sports.

FrankFranklin

II/AssociatedPress

BIRMINGHAM, England—France has Champagne. Spainhas Serrano ham. And in a res-taurant on the outskirts of thispostindustrial city, MatthewO’Callaghan is tucking into aBritish dish that he hopes willsoon join this constellation ofelite brands: a curry called theBirmingham Balti.

Mr. O’Callaghan is chairmanof the U.K. Protected FoodNames Association, which spear-heads the country’s efforts towin protection under Europeanlaw for local food and beverageproducts that may be threatened

by knockoffs.This lofty desig-nation is a no-brainer for someof Europe’s foodsuperstars: notjust Champagne,but also Italy’sPizza Napoletanaand French Gru-yère cheese.

For many ofthe British foods Mr. O’Callaghantakes on, however, the road toprotected status is decidedly up-hill. Mr. O’Callaghan’s sometimeslengthy campaigns have helpedless-celebrated British foods winprotection. Victories include the

Melton MowbrayPork Pie, Storno-way Black Pud-ding and a North-ern Irish eel.

“British food isunique,” says Mr.O’Callaghan, aftertearing a piece ofnaan bread andscooping up theremains of a Bir-

mingham Balti. “It’s the skill ofthe British people and how theyhave turned some of these ingre-dients into some of the iconicfoods not only of Britain but ofEurope.”

PleaseturntopageA8

BY MAX COLCHESTER

One Man’s Quixotic Quest to Boost British Cuisinei i i

It Ain’t Champagne, but Balti Looks for Equal Billing

Birmingham Balti

Europe braces for blowback... A6 Gunvor cofounder targeted.... A6 EU wary of legal challenges... A7

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