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A hard fought election in Brazil between Mr. Bolsanaro and an ex-president Lula da Silva. Voting is compulsory in Brazil for all those who are literate and between age of 18 and 70 years. There are 156 million registered voters. President and members of Chamber of Deputies are elected for a four year term. Elections also take place for 27 governors for 26 states and one federal district. If no candidate in elections for president or governors gets 50% of the vote the vote heads to a runoff on October 30 between the top two candidates. Bolsanaro is supported by evangelical Christians in a Catholic country, rural landowners, and business people. He was a deputy or member of parliament for the state of Rio de Janeiro for 27 years, who won on a law and order and anti-corruption platform in 2018. Lula da Silva is a former trade union leader who was president from 2003 to 2010. He was popular during a commodity boom in Brazil's soyabean and iron ore export boom to China that financed social support programs. A corruption scandal affected his successor from the Worker's Party leading to the change in government after the collapse of the commodities boom. After he was given a jail sentence under the Bolsanaro government he was released by the Supreme court decision in 2019 that declared there was a lack of due process in his conviction. Mr. Bolsanaro also as a program to benefit poor families that is called Auxilio Brazil to replacve Lula's Bolsa Familia. Payments to 18 million recipients were increased in August and a monthly stipend was added for taxi and truck drivers by Bolsanaro. The competing interests and the pandemic with the high toll of around 685,000 deaths have created a highly contested election. ...

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He is one of the authors of chapters in Project 2025. He is also the deputy OMB director in the first term of DJT 2016-2020, and someone with a great deal of experience in running the Office of Management and the Budget. He is for the Republican line of cuts to the Budget to maintain the deficit within reasonable limits. Yet with the need for investment in the country for growth and to support income growth for workers and families there is no monolithic position in the Republican party. Much of Biden infrastructure investments have supported growth and fill need for restoring aging dilapidated American infrastructure and has gone to southern states and mountain states mostly Republican. MAGA as its Biden counterpart is also about infrastructure investment and rebuilding America through investment. Under DJT it is also about spending these dollars wisely, efficiently and with due oversight which is also an imperative. The difference with the European Union with near zero growth in 2024-2025 and the 2.7% growth in the US is this willingness to take some risks and invest to rebuild the Nation under Biden + MAGA. ...

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Galston of the Brookings Institution says globalization has hurt workers in manufacturing with job losses and declining incomes. It has produced outcomes that have favored some industries such as tech, and not others such as automobiles which in the past helped create the broad middle class by offering good paying jobs to people with less than a college education. Immigration has created an issue that political leaders outside of the main parties have appealed to in France, the U.S. and Britain. The result is a polarization in the voters that has rarely been seen to this extent before. The middle class in the period from the 1950's to the 1980's is not the middle class that we see today in Europe and the U.S. The 2008 financial crisis added to the problems with the slow and uncertain recovery for some groups such as white men, the less educated, students, and people on minimum wage. 

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This WSJ podcast looks at the Fedspeak, the language, the use of specific words that telegraph the US central bank's carefully thought out message to markets. Th topic is inflation. Is it persistent or transitory? Fed chairman Powell's word for it was "transitory." Then transitory" but longer than we thought, because our Fed models did not include supplychain bottlenecks.  In reality every new variant brings new lockdowns and slows the rise or reverses the increase in gas and fuel prices that are a main driver of inflation. Wage increases are a good thing after decades of lack of leverage of workers and economic distortions from this, this may be termed constructive inflation.  Supplychain bottlenecks are likely to ease and not be permanent so that the Fed could be right on that point. A less noticed aspect of the Fed's decision to raise interests without careful thought is that this will impact the ability of poor and moderate income countries to afford medicine and food as exchange rates make their currencies worth less. At the time of variants this is both a practical and a human consideration. What are called emerging markets in finspeak (financial language) are really countries that Stephanie Nolan is writing about on the frontlines of the pandemic in the NYT- South Africa, Zambia. Then there are other poor or moderate income countries- Brazil, Mexico, Russia, India, Pakistan, Bangladesh, Indonesia, Philippines, Vietnam, Malaysia. Today the Fed needs to think about them also. How much vaccine, medicines, or food imports can they afford with weakening currencies as the Fed raises interest rates? At the same time some accomodations for inflation are necessary, but carefully thought, with a lot of thought given to the current state of the world with new variants and weakened economies and no stimulus payments in large parts of the world to offset weakness. ...

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Biden gives a rousing call to the Nation, on what he has achieved for America and its workers and families, for the people of 51 states, and what the tasks are for the future to 2035. It surpasses the State of the Union address 2024 in the vigor and importance of his message, 76 days before a national election to decide the future of the Nation and the World. Key parts of the speech selected by Lyrarc, on Infrastructure above and Manufacturing here with 800,000 new Manufacturing jobs created. "Because of you and so many electeds out there, American manufacturing is back. Where the hell does it say we wouldn’t lead the world in manufacturing. Eight-hundred-thousand new manufacturing jobs. Our Republican friends and others made sure they’d go abroad to get the cheapest labor. We used to import products and export jobs. Now we export American products and create American jobs, right here in America, where jobs belong. With every new job, with every new factory, pride and hope is being brought back to communities throughout the country that were left behind. You know you’re from it, many of you. You know what it’s like when that factory closed where your mother, your father, your grandmother, grandfather worked. And now you’re back, providing once again, proving that Wall Street didn’t build America, the middle class built America, and unions—unions—built the middle class.  It’s been my view since I came to the Senate and that’s why I’m proud to have been the first President to walk a picket line and be labeled the most pro-union President in history. And I accept it. That’s a fact. Because when unions do well, we all do well.  ...

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The main part of the $447 billion jobs plan proposed by President Obama in a speech to Congress on Sept. 8, 2011, is to reduce social security taxes. At a cost of $240 billion in government revenues in 2012, the Obama jobs plan proposes cutting the 6.2% social secuirty tax -on worker income up to $106,800- down to 3.1%. The current tax cut which expires in December 2011 cut the tax down to 4.2%. Analysts estimate this could generate over 500,000 jobs in 2012.

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For Ford Motor Company 2007, 2008 and part of 2009 should see negative cash flow of $17 billion. Already in the first 9 months of 2006 Ford had $6 billion in losses. About 23 billion in financing arranged to meet these financial cash flow needs to restructure N. American business and finance an entirely new product line and production systems. This includes the largest ever leveraged loan for Wall Street, $17.5 to $18.5 billion, according to Reuters Loan Pricing Corp. Leveraged loans carry an interest rate 1.50 percentage points above the London Interbank Offered Rate (LIBOR) and are loans to non-investment grade borrowers or unrated borrowers. Ford now carries a high yield or "junk" credit rating. To secure the loans Ford pledged all its N. American assets including its logo as collateral. This is the largest such arrangement for an American company in modern business history showing the depths to which the company has plunged. Fitch lowered Ford's ratings to B- from B. Ford is rapidly losing market share to rivals such as Toyota Motor. About 38,000 workers or close to half its factory workers have accepted buyouts or early retirement packages. Ford will shut down 7 assembly plants in 2010....

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Biden has put forward a new initiative to strengthen democracy by getting increased commitments to key features for democratic processes in the world. The idea is not to limit partnerships with other countries says Anthony Blinken, Mr. Biden's main adviser and secretary of state. This means India a key partner in both democracy and the Indo-Pacific can for defending its thousands of miles of border in the high Himalayas with enroachment of China into border areas such as Tibet, maintain its good legacy relationships with Russia as happened in last weeks Modi-Putin meeting.  The idea says Blinken is- "The US does not want to limit your partnerships with other countries. We want to make your partnerships with us even stronger." This means the Philippines, Indonesia, Malaysia, Sri Lanka, can maintain economic and development related ties with China which contribute to their economy, and build stronger relationships of culture and democratic processes with the US, India, European Union and Japan. For this reason the White House has emphasized that this is not about the US giving stamp of approval or disapproval of which country is a democracy and which is not. Too much of that happened under previous governments including Reagan, Carter, Bush, Obama.  The situation of Turkey relates to independence of judiciary and the unwillingness to take another look at problems. There is also the issue of technology is to be used so that citizens are protected from undue surveillance. Mistakes can be made but judiciary acts as an independent branch under the arrangements of checks and balances in American, British and now European frameworks of democracy built over centuries of struggle between monarchies and the people dating back to the Magna Carta in Britain. Neglect of workers and families also is an issue for democracies as for instance the effort now taking place in Germany under Scholz to "respect" workers and families. Lack of this led to the movements in US and European democracies giving room to vent that could ultimately lead to subverting democracies in the homeplace of democracies in the US or Britain. Why such a large gathering of 100 countries? Biden understands that the processes of democracy are always being improved and are a work for each new generation. For this reason there is no perfect scorecard- an ever renewing effort to make the process work in the best interests of the people of the country one generation at a time, to improve the quality of life and do this by preserving the right of peoples to choose their governments.  Why exclude China and Russia, till recently China had a consultative arrangement to run the country and Russia has elections? On this question the response of the Biden administration is that countries commit to the process and back initiatives to "counter authoritarianism. combat corruption, and promote respect for human rights."   Pakistan because it struggles with a long legacy of shortfall in the area of education after the collapse of Mughal rule that was seen under the British, and the general poverty of the Indian subcontinent that is striving to preserve the practice of elections, judiciary, and other democratic processes that were introduced in the Punjab and Sind provinces, and elsewhere since 1900. This is true for much of Africa, and also in parts of India, where aspirations of the people are for democratic process but faced with difficulties, corruption and poverty. In India the efforts of Naoroji, Gokhale, Gandhi, Nehru and Rajagopachari, Govind Pant, almost all leaders of the period since the 1850's, and able well meaning administrators since Lord Mayo in 1868 were to let democratic processes gradually find deep roots. Biden see aspirational in the face of difficulties as acceptable, even truly remarkable, with a willingness to learn from other countries to strengthen its own processes for democracy. It is no longer an Anglo-Saxon model alone as Germany and Europe are part of this process to be renewed by each generation. So are India and Japan. India after a century of elections since 1900 gradually expanding voters from one million to 5 million in the 1930's and to 900 million in 2019, with independent judiciary in a system of checks and balances as in the US.    ...

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The basic outlines of new health care legislation takes shape as Senators Dodd and Kenedy come up with a plan that scales down subsidies to low-income people to buy insurance. Attached to their revised outline is a budget office analysis thatprojects the plan costing $611 billion over 10 years and with expected changes from the Senate Finance Committee would cover 97 percent of all Americans. And earlier plan received much criticism because the Congressional Budget Office estimated its cost at $1 trillion over 10 years and left 37 million Americans uninsured. In addition there is the revised Medicaid expansions for aid to the poor that would add a couple of humndred billion dollars to the total tab. The administration's goal is to keep the cost down to $1 trillion over 10 years. The legislation as it stands includes the public option which is designed to control insurance costs. Mr. Obama said this week that "the public option would keep insurance companies honest." Employer mandated insurance is part of the Kennedy-Dodd legislation proposal. Employers with 25 or more workerswould have to provide coverage or pay the government an annual fee of $750 for each full-time worker and $375 for each part-time worker. The government pays the startup costs for the public insurance option as a loan to be repaid, and premiums would make the option self-sufficient....

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For the last 4 quarters Tesla has average profit of about $70 million each quarter yet in May Tesla awarded shares worth $800 million in May to Mr. Elon Musk, CEO, as part of the pay package, says this report in the WSJ.  These stock options need to be expensed as stock based compensation expense. These expenses put Tesla's meager profits based on GAAP in jeopardy says the WSJ. A third quarter net loss of just $226 million would put Tesla in a loss situation for the past 4 quarters. This for a company that is attracting massive amounts of capital. Is this a misallocation of capital by capital markets as structured today when there are pressing needs for infrastructure, health and education from the investment behaviour that prevailed for decades before the pandemic? Are there questions about pay packages that are thousands of times the pay of average manufacturing workers at the same company consistent with the kind of society we once were and now want to build after the pandemic? The average pay at Tesla is between $70,000 to $94,000 a year for workers making the CEO pay package about a thousand times that of the average worker. At the height of the crisis at VW it was about 170 times the average worker in 2015 in Germany. ...

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This article in the NYT explains why the loss of jobs particularly in the auto industry to Mexico, with the experience of NAFTA passed by president Bill Clinton, has caused widespread opposition to the TPP trade agreement proposed by president Obama. Both Hillary Clinton and Donald Trump in 2016 oppose the TPP.

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A survey of 414 National Association of Business Economics (NABE) economists shows Libertarian candidate Gary Johnson with 15%, overtaking Trump at 14% on who would best manage the economy. On protectionist views only 9% support this. 15% said they have no opinion and 55% said Hillary Clinton would do the best job of managing the economy. About 62% say the election uncertainty is holding back growth. Some aspects of Hillary Clinton's economic plan are the $275 billion infrastructure investment over 10 years, taking action against companies that ship jobs overseas, a capital gains tax paln that encourages long term investments, supporting $15 minimum wage, making upward mobility a top priority, providing government financed access to public colleges for working class and lower income groups. Donald Trump's plan has suffered form lack of specifics, shifting comments, lack of careful study, and excessive use of slogans. Both candidates oppose trade agreements that shift jobs overseas. Trump's plan also suffers from lack of credibility overseas as this is important in a global business structure, with fears of protectionism increasing. and reminding people of the protectionism under Smoot-Hawley that increased the damage from the depression of the thirties. ...

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This analysis in The Guardian says US president Biden is reversing 3 decades of policy since president Reagan that looked with skepticism at government intervention in the economy. The $1.9 trillion aid package Biden has pushed through Congress is a big game changer in the way government operates to help rebuild America after the pandemic. The 2009 response by the government under president Obama was done without conviction that the government response was the best way to help the economy. By 2016 voters turned to a Republican, Mr. Trump, to help working class voters with a USA first policy, after decades of presidents from both parties Republican and Democrat failed to protect American interests in manufacturing, jobs and incomes.  US president Biden is continuing Trump's policies to protect working class Americans. And bringing new conviction that government not only has a positive role, but has an essential and vital role to play in protecting workers and households struggling to make ends meet. President Reagan had introduced such a deep skepticism of government, that it took so long for people to remember FDR and the role of government before the second world war and afterwards under the Truman administration.  What changed? The health care crisis exposed the weak areas in the governance and policy mindset in America. China had advanced mainly through strong government role of the Communist Party  in steering the economy and business to gain competitive advantage. The health crisis from the pandemic further devastated America's lower middle and working class following the banking and financial sector mismanagement by 2009. The pharmaceutical and health care sector similar to other sectors had shipped manufacturing overseas. In 2021 there is a deep sense that theories don't work, one has to act based on the needs and the situation the country is facing. The way competitor nations such as China are building new infrastructure, gaining manufacturing advantage, dominating key sectors and industries, and creating jobs, requires America to respond. In this situation posing the threat America faces as well as the social dislocation of decades of misguided policies, the US government is the only one capable and having the resources and capacity to respond.  ...

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The rulings in Britain for "duty of care" protect a customer or worker from harm. The rule "to love your neighbor becomes in law "you must not injure your neighbor." This is the new idea that the British government is moving forward so that the internet as public space is protected for all who use it. It does not state how many fire extinguishers are to be installed in a public building. Britain's Health and Safety Act simply requires the owners to do all that is needed to protect the users and occupants from harm. Since 1945 this is the foundation for heath and safety laws in the U.S. and in the UK.  This is the principle that 2 researchers Mr. Perrin and Ms. Woods have come up to tackle the protection of the internet as public a space. Perrin is a civil servant and founder of Ofcom, the UK's version of the U.S. Federal Communications Commission regulator. Woods is a professor of internet law at Essex University. It is now part of the legislation proposed by Boris Johnson's government in The Queen's Speech outlining government priorities. A new regulator would have the power to require companies to protect users of public spaces (the internet) from online harms such as pornography, extreme content, cyber bullying. The 2017 suicide death of Molly Russell a British teenager made this a priority for the government. The French government is also proposing rules based on this principle. ...

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Example of a aluminium company in Quingtongxia which disconnected from the national electricity grid and connected to the local electricity grid with the consent of the regional government to bypass the increase in electricity prices mandated by the central government in Beijing designed to discoutrage electricity consumption by energy intensive industries. As a result of this type of activity China has seen only a 2 % decrease in electricity consumption in the first half of 2007 by official estimates. To meet the goal of a 20% reduction in energy consumption per unit of output by 2010 China would have to see reductions in the range of 4% per year. This example of Ningxia Hui Autonomous Region is an interesting one. Ningxia is in the western region of China and unlike the coastal regions which were the early beneficiaries of China's manufacturing boom years, this part of the country lagged behind. Its near Inner mongolia and far to the north west of the country near Gansu province. its one of the samllest o the provinces and autonomous regions, having a population in 1949 of about only 1 million, its since grown with migration and indutrial development but is still lagging behind. It has plentiful coal and so it is felt here that this is a natural resource asset that would help it grow in energy intensive industries like aluminium and help it close the gap with the coastal proivinces. The industrial development came to Ningxia only in the last 10 years so that its local economy and regional government officials feel they would be left out if they aren't allowed to catch up. So to them it all makes sense. Several other factors play a part. The rapid economic growth means more opportunities for relatives and friends of regional government officials. This is happening across China in coastal provinces and in the provinces of the interior. How can senior government officials in the coastal and large cities in the east point a finger at hese offendors when they are all beneficiaries of the same system and are using it to their benefit. And then there is the factor that rapid economic growth is considered the main objective if it slows down and there is social unrest from unemployment or other worker or farmer unrest then all government officials and communist party officials lose out if the communist party loses control. And the fear of chaotic years following social unrest create a common interest in pursuing rapid economic growth at all costs. So its a roller coaster that while the leaders in Beijing and Shanghai and the big eastern cities are aware of the risks and costs to the environment and other costs they are not able to control regional and local policies and actions....

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Katsuya Okada is elected leader of the Democratic Party of Japan in Jan 2015. He is from a prominent business family. His brother is CEO of Aeon, a supermarket chain in Japan, which was founded in 1758. Okada says he supports Abenomics, saying: "I have no intention of completely rejecting Abenomics. On the contrary, there are many areas where I'd like to tell him, 'Go for it. Step up the pace.' " Policies he backs are deregulation to improve productivity, and Abe's policies to increase worker wages. He also supports being better prepared for regional conflicts, and said the DPJ would study Abe plans for legislation to strengthen the role of Japan's defense forces. Okada's comments reflects the changing sentiment in Japan about Abenomics since Abe's win in the snap election, and winning credibility for his economic policies.

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Sweden which appeared resilient in the early part of the eurozone financial crisis is seeing a sharp slowdown in exports. The government growth forecasts show a steep decline in growth to 1.1% in GDP and unemployment at 8.2% in 2013 as eurozone exports decline. GDP growth forecast for 2014 is at 3%. The decline is from the 3.7% growth in 2011. About a third of Swedish exports go to the eurozone countries. Sweden's steel company SSAB has put workers on a 4 day work week and a 20% wage reduction as demand declines. Finance minister Anders Borg says "Our assessment is that Sweden is facing a couple of lean years. It is becoming clearer that the crisis in Europe and developments in the U.S. are again costing jobs and weighing on growth in Sweden."

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The terms of the bailout loan to GM and Chrysler prohibit a threat to strike or a strike by the UAW during the negotiations with GM that take place between now and Feb 17, 2009. These are the terms between the Treasury Department and GM. Smaller strikes at GM and a longer strike at American Axle and Manufacturing cost the supplier and GM billions of dollars in cash at a perilous time for GM, showing that steps by the union have not been in the interests of the union and its workers in the long run. GM and the union now have the government also as a part of the negotiations, and more pressures are inevitable to become competitive in wages, benefits and other costs with the Japanese manufacturers.

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A report released by the Organization for Economic Cooperation and Development (OECD) shows growing income inequality in 34 OECD countries. OECD Secretary General, Angel Gurria says: "The social contract is starting to unravel in many countries. This study dispels the assumptions that the benefits of economic growth will automatically trickle down to the disadvantaged and that the greater inequality fosters greater social mobility. Without a comprehensive strategy for inclusive growth, income inequality will continue to rise." Countries with the largest ratios between incomes at the top and the bottom, are the United States, Turkey and Israel, roughly 14 to 1. Germany, Denmark and Sweden have ratios of 6 to 1, with their ratios up from the 1980's. Gaps in Chile and Mexico are at 25 to 1. The study covers the period from 1980 to 2008. Overall inequality went up by 25% in the U.S. from 1980. In 2008 the top ten percent in the U.S. earned $114,000, 15 times than incomes for the bottom 10%. The top 1% of Americans saw incomes go up from 1980 to 2008, increasing from 8 percent to 18 percent. The richest 1% having $1.3 million in after tax income, and the lowest 20% making $17,700. The trends have accentuated an increase at the highest end- the top 1% and top 10% of the people- and a sharp decrease for the bottom 20%, which can be grasped from the $17,700 and the $1.3 million, both at extreme ends. The study attributes the rise in inequality to a growing gap in wages for highly skilled workers as technology advances, a surge in foreign direct investment and a looser regulatory regime that reduces employee protections leading to wage premiums for financial jobs and smaller incomes for workers at the bottom. Income groups and professions and sectors that had the greatest influence in government were able during this period to get the greatest protection for incomes, and able also to maximize their incomes. Incomes in the financial sector increased dramatically in the last decade, as a result of deregulation leading to higher risk and speculative activities in the financial sector, leading to the financial crisis of 2008-2009. Financial crises further depress incomes at the lower end. Similiar income inequality trends can be seen for India and China. China has a Ginni coefficient of 0.5 according to researchers at Beijing Normal University, up from 0.3 three decades ago- a Ginni Coefficient above 0.4 is considered destabilizing. Another factor that played a part in these countries is corruption and lobbying by special interests for favored treatment of sectors or groups. Austerity measures taken in Europe and in the U.S. are likely to widen income gaps by depressing the lower end income groups, creating social unrest, especially in the absence of efforts to stimulate growth....

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In a decline in living standards for 9 months since March 2016, the longest stretch since 1975, UK household disposable income declined again in 2017. UK household's disposable income fell 1.4% on the quarter in the first 3 months of 2017, according to the Office of National Statistics. This decline for the third quarter in succession comes from weak wage growth, rising prices, and higher taxes. This also shows that Brexit has certainly not helped the British economy, and provides further evidence that it is hurting the British economy. With increasing uncertainty after the parliamentary elections, a weak government, serious questions about Brexit, further weakening of the annualized growth of 0.9% at this point is not ruled out by experts. One evidence about Brexit's impact- the steep decline in the value of the British pound since the June 23, 2016 Brexit referendum has accelerated inflation in May to 2.9%, significantly surpassing any slight growth in wages. This leaves Britain worse off than before, with the future uncertain under Brexit talks.  ...

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A seven month long negotiation for the government of Greece with representatives of the EU, the IMF and the ECB is completed in March 2014. A series of structural growth oriented reforms are part of the agreement. Part of the agreement focusses on returning some of the 2.9 billion euro surplus to the Greek people hit hardest in the crisis, a top priority for the government of premier Samaras. This includes homeless with 20 million euros, paying 2.8 billion in debts to suppliers in the private sector, 1 billion euros more than budgeted. 1 billion euros will be used to reduce Greece's debt. In total 500 million euros will go to relief for ordinary Greeks, including members of the police and security forces on low salaries. Social security contributions paid by employers and workers will be reduced by 3.9 percentage points, a step taken to boost wages. The agreement will lead to release of 10 billion euros in funds from the troika of EU,IMF and ECB. European parliament and local elections are in May and this has given the Samaras government a better position to state its case for helping austerity weary Greek citizens....