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U.S. Fed chairman Bernanke tells a IMF conference on financial crises in Nov 2013 that the unemployment rate of 7.3% does not reflect the problems in the labor market, which require strong action to improve job creation. He says the level of student debt is a serious issue that also needs to be taken into account.

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Sri Lankan president Ranil Wickremasinghe says he is keeping an eye on the debt write down agreement for Zambia that restructured debt of $20 billion with G-20 nation assistance. The IMF loan agreement should be done by August he says. Then comes $3 billion of assistance sought for imports of food and fertilizer. It will take a few months for Sri Lankans to see relief but he sees the light at the end of the tunnel.

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Surging investor interest in passively managed Vanguard index funds. Vanguard's Total Stock Market Index Fund takes the leading position in the mutual fund industry. Assets pass $3 trillion in 2014. Warren Buffett advises his trustee to put 90% of his net worth of $66 billion in very low-cost S&P 500 index fund, suggesting that it be Vanguard's. Vanguard is based in Malvern, Pennsylvania.

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Finnish president Niinisto provides a new understanding of Mr. Putin and the thinking that led to the invasion of Ukraine. Mr. Niinisto has an advantage having spoken with Mr. Putin countless times says this report in WSJ, and spoke again to Mr. Putin on May 14 to tell him that Finland was planning to join NATO. Putin simply responded that Russia does not pose a threat and "you made a mistake." He says it was not the Finnish way to not call Putin and tell him directly, and that not doing so would be like sneaking away around the corner. Mr. Niinisto says WSJ, has a rare insight into the thinking that led to the behavior of Mr. Putin in launching the war. Here are some insights from this report by Adam O'Neal of WSJ. On the situation in Ukraine Niinisto says " I would be a lot more worried about Ukrainians than about how Russians feel." Mr. Putin's willingness to see Ukraine's industrial centers, its infrastructure and cities destroyed, turning them into moon craters in the east compares with the relative ease of life in Moscow, St Petersburg and other cities, cushioned by Russian oil and gas exports and financial reserves. As a student of Finland's long and violent history with Russia Mr. Niinisto has some unique insights into Russian thinking. He tells WSJ's Adam O'Neal  that if a Russian is angry, yes, be careful, but if he's calm, be even more careful. The Russian invasion of Finland led to loss of 200,000 lives in 1939-40, and another 250,000 Russian lives in fighting between 1941-1944. Finland has 300,000 men or women in military reserves and men between 18 years and 60 years are called up for military service with the Finnish Constitution requiring every citizen to contribute to national defense. Recently Finland ordered 64 F-35 fighter jets from the US. What led to the invasion of Ukraine by Mr. Putin? Niinisto says that "somehow Mr. Putin has a feeling that Russia was betrayed in the 90's by the West. Over time this thinking continued feeding the negativity says Niinisto and led to the thinking that Russia could be betrayed once more.  Another aspect of Mr. Putin which was covered during the last decade of relations with Ukraine in Lyrarc, was his perception that Ukraine under various leaders before Zelensky was basically led by corrupt leaders including one president he supported but lost power in the last decade. Mr. Putin saw protests in Kviv and Lviv that ousted a president he supported recently as orchestrated from outside. This led to thinking that Ukrainian nationalism did not exist and he believed that Kviv would not be defended and would fall easily within a week or weeks. As his nationalist perceptions and that of a small group that included his partner in office Mr. Medvedev became stronger in the last ten years Mr. Putin made the decision to take the option for invasion in the thinking that the response of the US and Germany would not be to support Ukraine with arms and other aid. The CDU and SPD was perceived as weak in Germany and Scholz not seen as able to cut down oil and gas imports to the EU. Biden was seen as not willing to stop Russia by taking on a difficult conflict because of China allying itself with Russia, considering China's interconnections with the American economy. The timing was seen as good considering that this level of dependence on oil and gas imports of Europe on Russia would never be the case after planned shifts to renewable energy. The Russian economy was cushioned by its $620 billion in reserves and by the world's need for energy even as the shift to renewable was taking place. This window my have induced Mr. Putin to take what appeared to be a rational decision that ignored the common feelings of humanity of risking the destruction of a brotherly people that spoke Russian, prayed in Orthodox churches, and where Russia as a state started in the year 1000. Cambridge historian Brendan Simms in his new book "Europe : The Struggle for Supremacy 1453 to the present," has shown all European powers susceptible of reasoning and calculation of this type in their wars since 1453 in the struggle for supremacy in Europe up to the present- the Portuguese, the Spanish, the Dutch, the British, the French, the Germans, the Russians, the Danes, the Swedes. This also led to British and French empires in Asia and Africa with subjugation of Asian and African people. The Second World War had created the perception that somehow this had changed after the loss of millions of lives- that was the perception of Merkel a pastor's daughter who had grown up in the former communist state of GDR in East Germany, and of SPD leader Steinmeier who felt strongly about the loss of lives from the Nazi invasion. Merkel and Steinmeier built the relationship of Germany with Russia that has collapsed under Germany's new leader Scholz and Habeck-Baerbock of the Greens party. Merkel and Steinmeier also built the trade relationship with China that also faces collapse with China's support of Russia under Mr. Jinping, and the unexpected shifts in Chinese leadership and policies from that pursued by premier Deng and his successors in 1990-2010 of interconnected economic links with US and EU. Mr. Scholz, the new chancellor of Germany has Brendan Simms book on Europe on his reading list for 2022 as he ponders over the lessons of 2022 and the pandemic. Mr. Biden with long experience in the Senate of the US has a memory and understanding of what happened since World War II, how America got to this point, and what it will have to do to bring back the American spirit to the Free World that America has led for most of the last two hundred years. ...

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England miss the tenacity and run scoring ability of Alastair Cook as they lose the Ashes. England was unable to come up with anything to match the legendary scoring of Australia's Steve Smith in the Ashes fourth Test with 210 and 82 in two briliiant knocks with the bat at Old Trafford on Sunday.  Cook reflects on his own period as Captain of the English side in his new book. He now plays county cricket for Essex after Test cricket drained him and he decided to retire. He says from the first time a Test cricketer gets on the scoreboard he is the subject of incessant reporting on averages for the batsmen- for whom there is no rest- because between the glorious hundred he is out for nought or 20 more often. He recalls his last game in Test cricket when he was able to score 147 in the second innings against India, and he considers himself so fortunate to be able to retire at that time. England is going through a period when it feels it is short on good batsmen. And Cook says after Strauss retired in 2012 he could not find a stable partner, not one of the 14 he batted with lasting long. What does he think of Steve Smith? Cook says he is phenomenal.  The best three batsmen he has seen- Lara, Ponting, and Kallis. The good batsmen in English country cricket are still too young. He thinks the best way to keep Test cricket strong is to have less of it so that it remains special. This way fans would be riveted. And this would mean players would not have to choose between franchise cricket and Test cricket. ...

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The Economist points out serious problems at India's state owned banks. Following a $21 billion or 1.3 trillion rupee bailout from the government, and a new bankruptcy law to help banks deal with bad loans, the Indian banking sector was seen as recovering. Last week (Feb. 2018) showed new problems at three of the largest state owned banks. PNB, Punjab National Bank, is faced with fradulent transactions for 114 billion rupees, about a third of its market capitalisation. A jeweller, Mr Nirav Modi, had PNB employees issue letters of credit which were then used to borrow overseas, but the credit was not shown in PNB's books. The State Bank of India, SBI, is faced with losses after tackling bad loans. The Reserve Bank of India, India's central bank and bank regulator, has taken action to have banks recognize more bad loans to clean up the banking system.  The Bank of Baroda, the third largest state owned bank, is exiting South Africa after entering that market and lending to the controversial Gupta family that is seen as having undue influence on the government of ex- president Jacob Zuma of South Africa.  These events have battered the reputation of state owned banks in India. One private lender HDFC bank alone now has market capitalization worth more than the entire state owned banks in India. State banks are worth less than net assets in the market, showing a huge credibility gap. The bad loan situation that goes back to previous governments is affecting the growth rate in India's economy and creating new pressures on the government of prime minister Modi as it faces general elections in 2019. ...

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President Trump escalates the trade battle with China by increasing tariffs on $200 billion Chinese goods from 10% to 25%. The U.S. says China went back on its commitments in a 150 page agreement at the 11th hour or last minute, by deleting these commitments in all 7 chapters of this agreement. These are firm commitments sought by the U.S. in a number of areas of deep concern to the U.S. and the U.S. Trade Representative Mr. Lighthizer had already conveyed the determination of the U.S. to not relent on this. In the past China was seen to go back on its commitments and the U.S. side now wanted to ensure promises were kept. The U.S. concerns cover- theft of intellectual property and trade secrets, forced technology transfers, competition policy, access to financial services and currency manipulation.  The situation has been building up fro a decade with the Trump campaign honing in on this issue of China stealing U.S. jobs, and factory closures in the U.S., because of unfair trading practices. It also led to Mr. Trump's winning election campaign in the American midwestern states. With China seen as gaining an unfair technological advantage over the U.S., most recently over 5G telecom networks, the U.S. is not likely to back down. The U.S. is less dependent on trade with China. China is more dependent on the U.S. and a lot of manufacturing jobs in China are affected by the U.S. tariffs. This is why president Trump has decided to take a strong stand, including putting on tariffs on and additional $300 billion of Chinese goods.   ...

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The situation in Guangdong province in 2012, with older factories unable to compete with the rising wages, stricter environmental enforcement, and lower export demand. Many Taiwanese manufacturers are closing factories. The growth in Dongguan, a manufacturing hub in Guangdong, is estimated at 3.5% for the first three quarters of 2012, half the overall rate for Guangdong province. A researcher in a Chinese think tank says China's manufacturers are in a kind of "sandwich trap" with competition from Vietnam and India in lower wage production and competition from Germany and the U.S. in higher wage technology intensive products. This is especially true in 2012-2013, now that U.S. and German manufacturers have reduced costs and increased competitiveness.

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The Goethe Institut is for Germany what the British Council was for Britain and the USIS for the US in the countries of Africa, Asia and Latin America as well as Europe. A way to interface the world with ideas that contribute to world culture from Germany, and both influence and grow from the interaction. This is how Carola Lentz its new head in 2020 sees the Geothe-Institut on its 70th anniversary. There are 158 Goethe Instituts in 98 countries. The picture that goes with this article in DW.com shows language students from Ghana on the streets of Burnau, Bavaria, with their host family. It started in 1951 in Munich to spread German language and cultural studies in the world. Pope Francis studied German in his early years at the Goethe Institut while staying with a host family in Boppard, Rhineland-Palatinate, when he came to Germany from Argentina. Carola Letz brings an interesting background to this work as a researcher on societies in Africa, and her study of sociology, politics and languages. She believes the true work is to build conversations with other countries and to engage people inside Germany into this conversation for the first time, a task never undertaken before by the USIS or the British Council. As has happened accidentally and also with the sense of "'arrogance" in the US and Europe towards other less industrially developed countries, people inside European and North American countries were far less equipped with knowledge and understanding of world societies than their representatives overseas in post war period.  Lentz, born 1954. who lives in Mainz near Cologne, the home of Goethe, is an ethnologist and African Studies expert. Lentz sees a new approach of conversations with people in other societies, about an approach that is considerate, not arrogant, for developing joint answers to global questions.  A new exhibit opens on the 70th anniversary at the Berlin museum Hamburger Barnhof- "Take Me to the River," on global environmental changes on November 29, alongside another exhibit "Nation, Narration, Narcosis," on the role of museums in the culture of remembrance. This brings Germans inside the country into this conversation for the first time along with  the thousands of visitors from other countries.     ...

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The European Recovery Fund package finally gets settled after long negotiations over the weekend. It is settled by lowering the nonrepayable direct aid to countries hardest hit by the pandemic of 500 billion euros the initial target to 390 billion euros. The change was made to meet Dutch demands that are based on right wing parties in Netherlands critical of the deal and upcoming elections in the country. Mr. Rutte of the Netherlands held on to the end. He has been in power for about ten years by following the Dutch mood carefully. This time both Merkel and Macron, both France and Germany supported the 500 billion euro plan for nonrepayable aid to countries particularly in southern Europe that took the brunt of the pandemic- Spain, Italy and Greece. The EU's executive branch will now for first time issue debt on a large scale to fund this nonrepayable aid and additional loans of 360 billion euros. There is also a multiyear EU budget of 1 trillion euros for 2021 to 2027 designed to meet the goals of European recovery. The way the EU is setup a lone holdout or a small country like the Netherlands with the help of two other small countries Denmark and Sweden could hold up the agreement against the interests of the larger nations Germany, France, Italy, Spain, Portugal. Poland and Hungary also strongly supported the 500 billion euro target for nonrepayable aid. The combined population of these countries is about 314 million compared to just 17 million for Netherlands, 10 million for Sweden, and 6 million for Denmark. In addition Merkel has recovered her footing in Germany after the pandemic and most right wing parties in Europe have lost ground during the pandemic. That Mr. Rutte could push this far in the face of the need to show solidarity at a time like this shows weakness in the fabric and structure of the EU, and its rules and organizing charter. Normally a blocking minority would need 4 countries and 35% of the population to block EU proposals supported by the majority. This could be used if the blocking is seen as not in the common interest. In recent years most decision are made with unanimity, but this is one in which solidarity needed to be shown without the long negotiations taking some of the spirit and vigour behind the earlier plan. ...

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 South Korea has run about 300,000 coronavirus tests, double that in Italy and ten times that in the U.S., says this report in the WSJ. This report shows how the South Korean testing works and the workday of Lee Hyuk-min, a clinical microbiologist at a testing lab of Yonsei University Health System Severance Hospital in Seoul, who is working from 4.45 am to 11 pm. South Korea's effectiveness in controlling the spread is based on a strategy of efficient testing that enables isolating quickly people and areas. South Korea's testing network is a legacy of the MERS coronavirus outbreak in 2015, and the government failure at that time to control it.  It brings together doctors, medical staff, labs, and political leaders in roles following the protocols established since then. Dr Lee and others are the final checkpoint in the system which coordinates a diagnostic operation that combines together 633 test sites and 100 labs. The protocol includes a uniform setup- same testing equipment, same training, same decision making process. At 8 am each day all labs upload results to a shared database, which allows public and private hospitals to monitor patient results and report them to Korea Centers for Disease Prevention and Control. Hospitals upload testing details to an online directory. This surveillance allows South Korea to predict where to concentrate its efforts for controlling spread, says Dr Lee who advises the South Korean government on lab testing issues. Action plan took 2 years for the new rules to be implemented following MERS in 2015. The plan included accelerated bio testing company approval for tests. The first company got approval on Feb 4, followed by 4 other firms. Dr Lee says testing is only part of the equation as labs are needed to process and confirm results. Another key is innovation. South Korea setup testing in drive thru locations, that limit contact and speed up testing, which the U.S. is adopting. Dr Lee says early identification is key, and identifying the first coronavirus patient which was done in South Korea on January 20. Other countries including the U.S. took too long to identify the first patient, says Dr. Lee. ...

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The inventor of the white LED bulb is the son of a Japanese father and an American mother. He invented the LED bulb by doing research in a small company which required courage to get the research funded for IGaN. Only a few researchers were following this route less than 1%, Nakamura had the confidence in himself, believed in himself to take this route that led to the white LED bulb. The more he was turned down the angrier he became and had it approved by the founder of the company. In 1992 he made the first white LED bulb. Why is this important. It shows what we can do when we pursue what our mind tells us and what comes from inside. Nakamura had to work very hard to do this. In a small company he says he had to do everything himself. So thats it the LED bulb. Amazing and what an achievement for climate change action. California uses 35% of its electricity for lighting alone. White LED cuts this in half. ...

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Wagoner became President at age 45, CEO at age 48. So you would think that young blood is coming in to GM, but that does not appear to be the case. At the Board level most of the Board members like George Fisher formerly of Motorola, have been around for a long time, and there does not appear to be new blood that would bring in fresh thinking. And serious decisions about investment in developing new technologies to develop fuel efficient cars, like hybrid technologies, electric and other alternative technologies, diesel technology, have been held up for years at General Motors. The way decisions are made on such issues with Board members voicing their opinions more than wrestling seriously with the issues, shows serious shortcomings of management and the Board. At key points of decision making the CEO and key members of his team had not prepared carefully, and Board members did not come up with serious thinking on the problems facing GM. It, appears that the investment in technologies to develop fuel efficient cars much earlier, long before they were finally being addressed in 2006, was a failure of Wagoner's management and of the Board. Management discussed this but continued to be mired in old ways of thinking that continuing with the status quo- cars with existing low fuel efficiency- would not expose GM to illwinds as preferences changed. Its clear from the description here of discussions within GM that the old thinking is quite entrenched at GM, and Wagoner just was not the kind of person who could vigorously articulate a new vision for GM. A couple of things are noteworthy in this account of management indecision at GM. When fuel prices began hurting sales of SUV's and large vehicles in 2005, efforts to get a decision on investments in new technologies for fuel efficiency for the whole product lineup failed at the Board level in an April 2005 meeting. One Board member saying at that meeting, that" do we want to lose another billion dollars in developing new technology for fuel efficient cars." And no one calling him to account that the remark still did not address the point that GM had to respond to the changing market and world oil dynamics, and not just hope for the best, as GM had aggressive competitors, and faced continually diminishing role in the market place for the entire decade of the 1990's. While April 2005 was already at the tail end of the previous era of gas guzzling cars and a decision then would still not have shown a forward looking vision of things, it was not until 10 months later that a decision was reached. And this almost from necessity, as oil prices jumped in 2006 after hurricane Katrina, and by this time President Bush was also calling for higher mandated fuel efficiency standards. The other noteworthy point here is that by making the changes so late in the game, GM had to compress the development cycle for new and some cases unknown technologies into short time frames. If the ingenuity of its engineers comes to its rescue it still faces another hurdle that of cost, because the technologies have to be perfected and improved, so that the costs are low enough for customers, and importantly comparable with what it is costing competitors to make the same fuel efficient technology engine or other part. Which is why one Honda executive remarked, "GM like everyone else is serious about this, because they have to be, but how many of their hybrids and how many Volts will they sell? Their technology is very expensive." Even if GM develops the Volt electric car by 2010, GM will need a whole range of fuel efficient technolgies to power its large product lineup. Its just to hard to avoid the conclusion that this is going to prove costly. All the dragging of feet and indecision, and failure to prepare GM for a different world in case something drastically different from what was expected happened, will prove very costly especially considering how aggressive and well financed some of the Japanese and German competitors are. It also hard to avoid the conclusion that there is too much bureaucracy at the large auto companies, and getting new blood and new ideas and fresh thinking is tough in a place where everybody agrees with everybody else, and there is uniformity of thinking. This makes it difficult for any original or wayward types to thrive. These bureaucracies look up to the top for direction. Initiative is discouraged on one hand, and at the same time even if a new direction is taken at the top. a lot of resistance can be expected to implementing it throughout the company without persistent persuasion and reminder of new facts and realities. This is true for both Wagoner and Mullaly as they face the skepticism of subordinates to new direction. Mullaly for instance has to remind his managers that large vehicles are only a small percentage of the entire global market, and if Toyota is making money in small cars so can Ford. See the link to this. Is Toyota immune from bureaucracy type behaviour throughout the company? Not really, Toyota's chairman emeritus came out of retirement in fact and went out of the way to caution its CEO and management about their complacency a year or so before. Shoichiro Toyoda personally intervened to caution against too much expansion in the US and climbing wage costs, and other risks they perceived such as the company managers in the USA appearing to be resting on their laurels. See the link to this. A lot of discussion is probably going on within these companies about the present state of affairs, and considerable anxiety for what the future will bring. It may be useful to ask the question is there something that makes it difficult for once successful organizations -now with entrenched bureaucracy and set ways -to put forward leaders with vision and foresight, till it becomes very late? The vision and foresight about where their markets and the world is heading, and the ability to move their organizations in that direction. Or to break out of old patterns of behaviour and thinking....

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This New York Times editorial describes the impact on lower income Americans of spending cuts that are part of the Romney-Ryan plan.

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The downturn starting in the 2008 financial crisis destroyed a huge portion of the average American's personal wealth- some estmates running to 40%. This was followed by periods of unemployment which depleted savings accounts, lower wage jobs, and followed by further erosion of savings accounts with little or no interest. The gains on the stock market have one problem- the benefits go in large part to affluent Americans who are already well prepared for retirement. A U.S. Senate report shows a huge retirement savings deficit- about $6.6 trillion, which comes to $57,000 for every American household.

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The figures are startling, alarming dangerous whatever you call it. How many homeowners are under water or owe more on their mortgage than their house is worth today in today's depressed market? And how many more will be under water in tomorrow's even more depressed market as unemployment gets worse in 2009, and much worse after that in 2010. Moody's Economy.com's chief econmist mark Zandl has worked out some figures. And he says one in 6 mortgages in America today are under water, that is 16% of 7.5 million households that own homes they live in, or roughly 12 million households. To give some idea of how quickly this is deteriorating while Congress, the Administration and the general public could not reach any agreement or consensus about assisting homeowners avoid foreclosure in steps that cover all homeowners across the USA. The comparable figures were roughly 4% under water in 2006 and 6% in 2007. Thats a huge jump from 6% to 16% and was not expected to be such a steep jump in 2008. And it may be accelerating for 2009. And of the homeowners who took on a mortgage in the last 5 years the figures are startling, 29% are under water according to estimate by real estate Web site Zillow.com, that is one in 3 almost. Which is why absence of government help on a comprehensive scale covering the whole country and all homeowners facing foreclosure remains the one huge gap in the rescue package passed by Congress for $700 billion at Sept end 2008. Why is it dangerous? Because it accelerates the downturn in the economy and exacerbates the problem of toxic mortgage assets on the books of overleveraged banks, as dropping housing prices from higher foreclosures depresses the value of those assets even further. And this creates a vicious circle of lower consumption spending followed by lower production, higher unemployment and leading to lower consumption spending in a repeat cycle leading to higher foreclosures as a consequence of higher unemployment....

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Fuel efficiency standards were left way below the rest of the world, just look at the graph showing Japan and Europe way above the US in fuel efficiency standards, and the US lagging behind badly. Europe and Japan with standards close to 40mpg vs the US below 30 mpg. Any sharp business person can tell one that if there was too big a gap, it would be a cause for serious concern, because the Japanese for instance would also have developed the technologies and manufacturing facilities to support the fuel efficiency standards. There were some serious dangers in falling behind. That is what has happened as the Japanese carmakers have take market share from the US in the American car market.

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Collapse of the easten european economies says the Economist would raise questions about the idea of a united Europe, the idea of the EU itself, and destabilize the euro - as countries in the EU like Ireland and Greece are in just as bad a shape. And in talk of enlargement of the EU will be doomed, and this is true of the western Balkans, TUrkey, and some countries int he former Soviet Union. Politically letting these countries derift could mean they fall for populists and nationalists of the bad type. And there is the serious economic consideration for banks in Austria, Italy and Sweden, which are heavily involved in lending to Eastern Europe. They could see catastrophic losses and put the banking systems of these countries at risk. Sweden has already chosen to help the Baltic Countries, and sees it has its political responsibility, and the whole Baltic region as its home, see link. The Economist suggests a differentiated approach depending on which group of countries in Eastern and Central Europe something that Angela Merkel of Germany also supports. For Ukraine the Economist says its best to let the IMF provide assistance. For the Baltic countries, plus Bulgaria, the Economist advocates an accelerated path to the euro, on the grounds that they are tiny and shouln't affect confidence in the euro. The Baltic countries have a population of 7 million. This approach is not supported by the European Commission or the European Central Bank. For the 4 larger countries, Poland, Czech Republic, Hungary, and Romania, the Economist says the priority should be to prevent further currency collapse, and to rescue the banks responsible for the foreign currency loans that are going bad, with the pain being shared between debtors and the banks, governments of lending and borrowing countries. Financial institutions like the ECB, the IMF, and the European Bank for Reconstruction and Developemnt, and the European Investment Bank should help support the rescue effort. ...

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Joe Nocera visits two plants built by Gray Construction in N. Carolina. One is a Siemens plant in Charlotte, N.C., and the other is a Caterpillar plant in Winston-Salem. Both towns have community colleges that stress manufacturing skills. Forsyth Tech created a program working with Caterpillar to train its graduates in machining skills needed at the plant. The Caterpillar plant is huge at 850,000 square feet, and makes axles for mining trucks. The Siemens plant will make 280 ton gas turbines. Siemen's manager Richard Voorberg, tells Nocera the labor cost difference is not that much of a factor in highly skilled work, with shipping costs, and other efficiencies being more significant. Gray's backlog of 22 projects suggests a similiar conclusion. The problem is that the number of skilled workers needed in an highly automated plant with complex robotics is small. Caterpillar's plant will need about 500 workers, and the Siemens plant will need about 800 workers. This makes only a small dent in the enormous job losses of the last decade. And in N. Carolina the jobs lost in the furniture industry as the industry moved to China. Dow Chemical CEO, Andrew Liveris, points to the jobs created in the supply chain for every manufacturing job. And Ford Motor Company CEO, Mullaly, points to the innovation required in state of the art manufacturing, that creates sustainable advantage. The process of creating enough manufacturing jobs will take a long time, including shifts to new technologies and new products....

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Wang Lequan, who is the party leader for Xinjiang, is aprotege of Chinese President Hu . He was pulled into the party from Hu's days in the Chinese Communist Youth League. He is from Shadong province China's industrial and petroleum capital. Because of his familiarity with the oil industry Wang may have beeen transferred to Xinjiang province. He arrived in Xinjiang just as the Soviet Union was dissolving, and the central Asian administrative regions that were formed inside the Soviet Union were becoming independent countries. China's army had occupied Xinjiang in 1949 under Mao. Millions of Chinese were leaving the Xinjiang area and the thinking was that the Uighur Muslims of Xinjiang would also form their own country. What happened was that Wang reestablished the Chinese presence in Xinjiang province. He opened the Xinjiang region's oil and gas fields to drilling, laid pipelines east to China and west to Kazakhstan. A Production and Construction Corps was formed so that Chinese soldiers leaving the army service could find work, and this was later listed on the Shanghai Stock Exchange. With growing industry and government jobs, many Chinese were attracted back to Xinjiang. In the 1990's 2 million Chinese went back to Xinjiang. At the same time his policies may have had the effect of making the local Uighur people feel that their culture and language weere being threatened and they needed to fight for its survival. Wang acting with dictatorial powers tightly constrained Uighur culture and religion. He substituted Mandarin for Uighur in primary schools, saying minority languages were "out of step with the 21st century," and banned or restricted Islamic practices among government workers, including the wearing of beards and head scarves and religious practice like fasting and praying while at work. He has been Communist party leader in Xinjiang for 15 years, which is unusually long, such jobs usually only lasting 10 years. SInce 9/11 Wang has fought hard to limit the influence of separatism, and the East Turkestan Islamic Movement, an Uighur group, and he has swept up thousands of Uighurs accused of terrorism or religious extremism. He worked to have the East Tukestan group listed as Al Quaeda allies by the Bush administration in 2002. He is closely allied to President Hu who supported Wang, giving him a seat on the Politburo. Wang's protege in Xinjiang has been placed in charge in Tibet. There is a sense with Wang and Hu, that a failure now in Xinjiang and in Tibet to control unrest would lead others in the Chinese leadership who think differently on theses issues to bring a different leadership to succeed them. The difficulty here is that the Han who now comprise 40% of the population in Xinjiang, and are heavily involved in the oil and gas industry, have brough a modernizing influence to Xinjiang but may not be received by the Uighurs as apositive influence. First any government that is in power for as long as 15-20 years tends to lose support over time. This happened with the Congress in Kashmir. Too powerful or corrupt, and lose touch with the young people. But compared to India the democratic ways of that country have helped it recognize the need for respecting the language, religion and culture of the people of each region. The British did the same, so it was something that went back to British times. With the monopoly of power of the Communist party, lack of precedent and amodel to follow that respected different culture and languages, the intolerance of Uighur and Tibetan language, religion and culture, creates a different situation in China. Elections were held in Kashmir recently and an effort is being made for reconciliation with different groups, the media is open and different voices are heard. No such prospect remains for Tibet and Xinjiang. ...