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security and North Korea's nuclear threats.
• Obama's efforts to press Xi to halt China's alleged hacking against the U.S. could be overshadowed by revelations that Obama's own administration has been secretly seizing phone records from millions of Americans.
• There are significant differences between China's reported cyberattacks against U.S. interests and the Obama administration's court-approved domestic surveillance program. But both underscore the vast technological -- and in some cases, legal -- powers that governments have to access information covertly from individuals, companies and other governments.
• The setting for the talks that begin Friday is the 200-acre Sunnylands estate just outside Palm Springs, Calif., marking a departure from the formality that typically greets Chinese leaders during state visits at the White House. U.S. officials hope the relaxed atmosphere will facilitate a more candid and free-flowing discussion between the leaders of the world's two largest economies.
• Obama was due to arrive Friday afternoon following a health-care event and a Democratic fundraiser in Northern California. He and Xi will hold a bilateral meeting Friday evening, then take questions from reporters. They'll also have discussions during a working dinner Friday night and hold additional talks Saturday morning.
• ___

• WASHINGTON (AP) -- Two Internal Revenue Service agents working in the agency's Cincinnati office say higher-ups in Washington directed the targeting of conservative political groups when they applied for tax-exempt status, a contention that directly contradicts claims made by the agency since the scandal erupted last month.
• The Cincinnati agents didn't provide proof that senior IRS officials in Washington ordered the targeting. But one of the agents said her work processing the applications was closely supervised by a Washington lawyer in the IRS division that handles applications for tax-exempt status, according to a transcript of her interview with congressional investigators.
• Her interview suggests a long trail of emails that could support her claim.
• The revelation could prove to be significant if investigators are able to show that Washington officials were involved in singling out tea party and other conservative groups for extra scrutiny. IRS officials have said repeatedly that the targeting was initiated by front-line agents in the Cincinnati office and was stopped once senior of

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