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After a long year of frustration with a small faction of 20 Congressmen in the Republican party led by Mr Gaetz Mr. McCarthy is taking on this group as it seeks to oust him from the Speaker's position. He will need Democratic support. This report looks at the changing situation in the US Congress. America needs a bipartisan approach to tackle major problems of infrastructure, climate change, wages and the cost of living, and education. It does not make sense to allow a few members of Congress to thwart the nation's plans to tackle its problems and challenges.

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President Biden says he opposed reducing minimum sentences for crimes in Washington D.C. such as carjackings, as proposed by a new law in D.C. Biden says Republican efforts to block that legislation would bring that to his desk and he would not veto the Republican proposal blocking reducing sentences. Crime is up 40% in Washington D.C say police. In the New York election for Congress, and in the recent Chicago mayoral election crime was an issue for Republicans leading to losses for Democrats and for Lori Lightfoot in Chicago. Biden wants to focus on the major issues for workers and families in the country, on infrastructure, jobs, inflation, and the US economy, and not let his plan for America's renewal lose focus because Republicans are able to make crime an issue.

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Mattinson and Ainsley have guided Labour's efforts to win back the trust of working class people and families in the UK. Here they talk about their visit to America and how they found an eerie resemblance to the situation in the UK, the same concerns about cost of living of food and housing or rent, the same concerns about immigration, and the same uncertainty about the future and the lives of their children. Could they ever trust Labour and could Labour deliver for them? During their visit they say -what they see Democrats and Harris already doing- focus on delivering for cost of living and for immigration. Starmer and Harris are both prosecutors and when Starmer talked up breaking up the gangs transporting migrants, and Harris talked about her prosecuting transnational gangs, they were talking about what they would do. Starmer set up the Border Security command, and Harris made the pledge she would sign the tough Republican Lankford immigration Border legislation into law.  ...

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Zelensky is going to Hiroshima to make his own case for support directly to all G7 leaders. The fact that G7 leaders are meeting in Japan also has significance as Japan unlike Europe with NATO faces Russian presence in its northern islands and China in the South China Sea and around Taiwan, North Korea, with only the American defense agreement in any conflict. Japan, Australia and India would want to see a clear end to the conflict in Eastern Europe that also sends a message that the status quo will be preserved on Taiwan and other issues in Asia. 

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A new family sedan will come out of a new manufacturing plant VW has built in Chattanooga, Tennessee, in 2011. The plant will turn out a new version of the Passat to compete with the Toyota Camry and the Honda Accord. Production capacity will be 150,000 A new Beetle will also be introduced. This is the first time VW has built a car specifically designed for the U.S.. During its previous efforts in the 80's VW used European designs and transferred them to the U.S. Its plans are to sell 400,000 VW's in the U.S. by 2013. VW sold 213,000 cars in the U.S. in 2009, so this means doubling sales in 4 years. At it height VW sold 577,000 cars in 1970, but this was before the Japanese and the Koreans entered the market in a significant way, and now the potential is there for Chinese and Indian imports at the low end of the price scale. Another factor making this goal difficult to achieve is the smaller car market and lower economic growth. By 1992, sales had dropped to 49,000, after the boxier replacement to the bug- in its Rabbit and Golf models- never took off. The new Beetle's introduction in 1998 improved sales, which reached 356,000 in 2001, and then declined as a result of too few new models, declining quality and a weakening dollar. There is a feeling among VW's American dealers, that VW's European headquarters staff is not giving the US the priority it deserves. The revolving door change in CEO's for the US operations, has only reinforced this impression. Mr Browning of GM's European operations replaced Jaccoby recently. Jaccoby joined Volvo as its new CEO. Steps taken to address these issues are to revamp the Jetta model for American customer preferences, and advertising that appeals to price conscious customers with the line: "Great for the price of good." Another innovative effort is an ad strategy that tries to capture Hispanics in the US market, with ads on Spanish language television networks. A sign of how much German management is involved in the detail of the new Jetta, is the discussion at the management board level about whether the new model should have American style cup holders. This meant pushing the brake two inches forward towards the driver, a decision that was made to do so after some deliberation at the management board. This will lead to intense competition in the US market, with Asian, European and US manufacturers all vying for the same price conscious customers....

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Tyler Owen points out that the innovations that made areal difference in the standards of living and incomes of people in America came in the earlier decades of the 20th century. From 1947 to 1973, this pattern continued with the doubling of inflation adjusted median incomes in the USA. From 1973 to 2004, it rose 22%. Over the last decade it actually declined. The impact of automobiles, airplanes, anitbiotics and new household appliances was huge in the prosperity and incomes of the American people. The personal computer and the internet do not offer the same potential for improvement in incomes and standards of living. At the same time as society ages in the US and healthcare dollars are measured as part of GNP, the increasing GDP from such dollars does not reflect an improvement in the health care people receive.

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How Petraeus won support in Congress and with public opinion, while at the same time changing the nature of the effort in Iraq. His struggles with General Fallon even though he reported directly to President Bush, who wished to disengage too quickly to make adifference in the failing effort to bring security. The first effort was to bring security with the surge in troops, then to build the Iraqi forces. To keep public opinion informed about tangible achievements of modest goals such as security for ordinary Iraqis, and fewer American casualties, rather than some beacon of democracy goal for the Middle East. A detailed account by the Washington Post of how this played out in the words of key players like Petraeus, Fallon, Ambassador Crocker and others, and what it may tell one about the lessons for another very different effort in a rural mountainous backward country like Afghanistan. One that emerges is to set modest goals like security, try new approaches but with a clear eye on the field, put in younger leaders who can bing flexibility and imagination and intellect, but disengage on favorable terms that achieves these modest objectives....

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China's BYD started in electric batteries and expanded into electric cars. It has emerged as the dominant electric car company in the world as China now has half of the electric cars on the road in the world. 35% of exports of electric cars are from China. Keith Bradsher of NYT reports from Shenzen that its first car was made in 2007 of poor quality, similar to Toyota in the 1930's as it tried car manufacturing for the first time. It has surpassed Tesla in making electric cars. In each of the last 2 years it has increased electric car sales by one million to reach electric car sales on 3 million. EV sales in China were up in 2023 to 9.49 million cars giving BYD the largest share of 31%., by comparison US electric car sales were 1.2 million. New assembly lines are being built in Brazil, Hungary and Thailand. And new lines are planned for Mexico and Indonesia. This kind of growth was seen only by General Motors in 1946 after the end of the war. It also shows the progress China is making. In solar panels something like the addition of 900 million solar panels meeting the entire increase in electricity demand for each year, so that emissions targets can be met earlier than planned to tackle climate change.  The same changes are happening in electric cars. China now has 40% of electric cars or gasoline/electric plug in cars going up to 50%. For export China is building large carrier ships, the first that will take 5000 cars for export to the Netherlands. The lowest priced electric car model the Seagull was priced at $11,000. BYD's lowering of manufacturing costs have given it the ability to price the cars to attract new car buyers.  Wang Chuanfu who studied at Central Southern University in Changsha known for its battery research, was an engineer who started the company in the 1990's to make batteris for Motorola. Between 2003-2006 he experimented with making cars in the hope of making electric cars. Stalled efforts in 2009 and 2011 were met with arenewed effort in 2016 trying a new approach to cut costs by developing a battery where supplies of lithium or cobalt would not be a constraint. He developed a new battery using iron and phospate to replace lithium cobalt batteries. A big break came in 2020 with the Blade battery that increased range to the level of cobalt lithium batteries at a much smaller cost. BYD hired German Audi designers for new model design. This time BYD was in the right position to build a car company matching all others with costs lower by about 35% than VW for some models. This comes from- lower costs to make in China, making its own parts inside the company for 75% of parts compared to VW only about 35%, and by the savings from its battery research.  BYD has shown ability to shift with market needs and opportunities. In 2022 assisted driving was facing hurdles, BYD had second thoughts about the new technology, by 2023 as it was increasing in use BYD committed $14 billion in autonomous driving technology. Driving range is a problem for people in urban areas going back to their villages in China. BYD has an advantage here compared to Tesla- it makes hybrid plug ins that account for half its sales. Toyota has also had emphasis on hybrid plug ins where it missed the opportunity was that it moved very slowly on all electric cars not realizing how fast things were moving outside it's world. This is the situation America also faces in 2024 and beyond who can deliver on the infrastructure capabilities, new research ,and tap American potential to compete in this new world where one innovation will follow another. ...

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Surveys of American, European and Japanese companies show souring of outlook for China investment. And Biden administration new rules leading to investment of China profits in the US economy. About $110 billion moved out of yuan denominated China bonds since 2022. There is a sharp decline in the profits of US and EU companies in China that are reinvested in China after China's sporadic lockdowns in 2022 and increase in interest rates in the US. WSJ Analysis shows $170 billion profits reinvested in 2021 to net decline in third quarter 2023 outflows of capital over inflows declining by $11.8 billion, the first ever since 1998. Unlike in the past profits are being repatriated back out of the country so that investments can be made in the US economy or in other countries in the supply chain. This is a fundamental shift as risk of doing business in China increases. 

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Mark Landler of the NYT intervews Ben Bernanke at his office overlooking the Washington Mall, and Secretary Paulson in his Treasury office. Both men look back at events that led to Chinese savings financing excessive American consumption, and currency and other policies on both sides perpetuating the dependence of America on lowpriced Chinese products, and of China on the American export market. Now that this export market is collapsing it presents China with serious problems with unemployment in the export sector, and pesents America with the hangover from a consumption binge that now must be paid for with years of low or negative growth. Could this have been foreseen and if foreseen could things either have been mitigated or prevented. In March 2005, Prof. Bernanke at Princeton was not at the Fed (his Fed job started in 2006), and cautioned about the imbalances presented by Chinese savings finacing American consumption. But Bernanke saw this as a market phenomenon that would take years, even a decade to work itself out in a global economy. He said "for now, we have little choice except to be patient." The prevailing opinion among Greenspan, Bernanke and others was that the global economy worked in ways that were ultimately benign and regulation was not a good thing. After all the situation benefitted American consumers and kept inflation low while also providing China as an additional engine for global economic growth. The American economy it was believed was large and resilient, and it would not be adversely affected in the long run by such a large dependence on foreign savings. Only the positive effects were visible and the adverse effects were simply talked away as not serious for now. Zoellick, who was deputy secretary of state says that successful models are very hard to change, and Paulson says that without some kind of crisis its hard to get changes made once asituation gets entrenched. For China efforts to strengthen the currency that would slow exports and improve internal consumption were stymied by a reluctance to disturb the status quo, and Americans were lulled into complacency as years of low priced imports provided the best of both worlds, high growth and low inflation. ...

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Gerald Seib of the WSJ says president Biden is coming back with new actions to revive the Democratic agenda after a challenging period in the first year. Yesterday's first formal press conference of 2022 gave Biden an opportunity to respond. Why the WSJ, NYT, did not cover on their online edition front pages president Biden's first formal press conference on Jan. 19, after 1 year of the Biden administration, will remain a mystery. With the American press acting this way it did not take much for Germany's DW.com to run the story with the title "Biden's first year weighed down by disappointment," with a thoughtful Biden at the press conference replaced by a picture of Biden staring downwards.  This is only the first year of the Biden administration. Actions are planned to ease the supply chain situation and bottlenecks at ports. Much is made of inflation, Afghanistan, Ukraine, by Republicans assailing the Biden record. President Biden responded to this by asking at the press conference what Republicans are for. On Afghanistan Biden held firm on not investing billions of dollars every week when there is so much need in America and the rest of the world at this time of the pandemic after a failed adventure for 20 years in "a graveyard for empires."  Biden pointed to the bright spots in 2022- vaccination and testing achievements in the face of anti-vax sentiment with 200 million vaccinated, the job creation in the economy with unemployment way down and wage increases by employers, and the $1 trillion in infrastructure spending tackling much needed projects state by state with immediate impact. Rarely has a president faced so many challenges in the first year as Biden pointed out- vaccination drive in the face of the Delta variant and anti-vax sentiment, the Ukraine crisis with a president Truman period like event of the Berlin Wall coming up just potentially around the corner, and efforts to tackle problems left untackled for a generation in infrastructure, for working families and climate change. Scoring on infrastructure spending, one of the three, with the other two for working families and climate change to be tackled in the remaining three years and beyond.  Biden also told the American audience at the press conference that he was reminded of what his father used to tell him- that if all goals are equally important, nothing is important. In saying this he said help for working families through child tax credit, child care assistance, community college education funding, health care costs, climate change investment were priorities for his administration that would be tackled step by step. And he pointed out from the outset of the conference that only one or two senators were blocking the party's plan for children and working families. All 48 other senators were united in the Democratic party behind his plans for workers and families. As were 5 Republican senators who he said he would not disclose because of confidentiality. In that sense president Biden already has the majority he needs in Congress. This is not happening because of the peculiar situation of the 2016 and 2020 elections in the US and also in Europe- the historical problem of administrations of Democrats in US, Social Democrats in Germany, and Labor in Britain having give up on their working class families and middle class roots. Tech revolution and internet has further complicated the situation with economic changes, tech companies not paying taxes normally due, and tech workers shifting to Democrats yet living in a world distant from working class families fracturing social cohesion. This is changing in Germany with Scholz in Germany with the help of the Greens determined to restore the dignity of working class families, for Biden with a similar coalition, and a process underway in Britain as Labor returns to its roots. In essence Biden was saying- the process of unwinding decades of unwise policy that hurt America as a nation and leader of the free world would take time, requiring a patient step by step approach. To bring America closer to its own roots and Jefferson's immortal words of "all men are created equal and endowed by their Creator with certain unalienable Rights, and among these are Life, Liberty, and the pursuit of Happiness." Jefferson went on to say in the Declaration that when government becomes destructive of these ends it is the Right of the People to alter it.   ...

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Simon Jenkins of The Guardian says it is time to clear some of the myths around migrants, tariffs, and NATO and in this way action by the current Republican administration can be a positive step. Jenkins says DJT is moving quickly in the first 100 Days because most presidents get only 2 years to make changes before losing the House or the Senate making legislation difficult to pass. If it appears that things are happening on many fronts too quickly that is just the nature of things under a democratic process where checks and balances mean all three parts of government- executive powers of the president are balanced by powers of Congress and of the Supreme Court. Jenkins points out that action on migrants with the unease about millions of migrants coming in illegally, putting tariff barriers to bring manufacturing back and rebuilding America's forgotten middle class, cutting the bureaucracy and misuse of funds, sending education back to the states, and rethinking NATO bringing Russia back into the community of nations, will have long term positive effects long after the chaotic nature that they appear in the news cycle and the media presentation has passed. He cites China being invited back into the community of nations under Nixon. And today disarmament possible only by working with Russia, when China is moving in the direction of increasing nuclear missiles with trouble spots in Taiwan. He does not mention the sending back of about 1 million people back to Mexico under President Eisenhower in Operation Wetback in 1954, Harry Truman a senator from Missouri who led the effort to cut waste and fraud in government spending in the Second World War, the ED Hirsch graph showing reading comprehension scores of American K-12 headed one way - straight down since the 1960's showing education is failing in the US and needs parents and states to come up with new solutions.   ...

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Toyota moves back to its utilitarian roots, where costs matter and pricing matters. Higher cost technological advances are being rejected in favor of older approaches that accomplish the same thing in the manufacturing process at alower cost. And pricier features like the solar ventilation system option on the new Prius are being rejected so that the price can be made more competitive with American cars. Even the idea of pricing Toyota's cars at apremium of $1000 or $1500 over American cars is being questioned in this market. The new Prius mad due to come out this year, developed at a time when Toyota was coasting as it emerged as the most profitable and the largest auto manufacturer in the world, has a price tag of $28,000 versus the $22,000 for the current Prius. This has alarmed some of the bigger Toyota dealers so much that Akio Toyoda the new CEO visited Southern California to talk to these dealers about what has gone wrong with the pricing. These dealers told him that they were worried about that price when they were drastically discounting current Prius models to maintain their sales rate. This is also happening when Toyotas are piling up unsold on car lots at most ports in the US. As Toyota competed with GM for top spot in sales Toyota's management of Watanabe and Kinoshita, the outgoing CEO and his assistant, say critics inside Toyota, lost sight of the need for caution as the company's manufacturing capacity expanded in Japan and overseas. Now with the selection of Akio Toyoda to succeed Watanabe as new CEO, the decision has been made to make a shift to anew generation of managers, with the retirement of 3 executives including Kinoshita and Watanabe. ...

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Donald Trump's economic advisory team includes in addition to Harold Hamm, shale energy billionaire, Steven Mnuchin, CEO of hedge fund Dune Capital Management, hedge fund billionaire John Paulson, Dan DiMicco, CEO of steelmaker Nucor, bankers Stephen Calk, and Andy Beal, tax expert Stephen Moore, and David Malpass, a columnist for the WSJ. The team is headed by Stephen Miller, an aide to Senator Jeff Sessions of Alabama. The Washington Post points out that the selection of the team with many hedge fund businessmen including John Paulson, who bet against faulty mortgages before the 2008 financial crisis, is at odds with his criticism of Hillary Clinton for her contacts with Wall Street and his message of not having any connections with Wall Street so that he could better represent the interests of ordinary Americans- people hurt by the 2008 financial crisis with the high jobless rate for older white men. In the 2008 election both candidates John McCain and Barrack Obama were shown in media articles to have connections to lobbyists for Fannie Mae and Freddie Mac. In the 2012 election Mitt Romney as a private equity executive at Bain, was a part of the financial industry. This time in 2016- after all the noise and tumult about who represents Main Street- is no different for Trump and Clinton's connections to the financial industry. Only Clinton has to respond to the movement within her party from Bernie Sanders for providing a genuine example, and breaking with the past. The team of economic advisors put together by Jeb Bush led by Glenn Hubbard may be little different in substance than the one put together by Trump in its connections to the financial and real estate industry. The only person who took on the financial industry to fight for homeowners interests shown in Lyrarc since 2008 is Sheila Bair of the FDIC, a Kansas Republican. She could truly represent the interests of working class and ordinary Americans simply from a notion of fairness that  is so much a part of the American experience. Yet she has said running for office and fund raising in the way it is practiced today makes the thought too difficult to accept. Recent developments do not offer encouragement. Yet ordinary Americans ought not to forget, and ought not to let anger affect a discerning view of things. ...

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Trade economists from Ivy League universities, are still peddling the old theories on trade from textbooks that make no sense and have got America in this huge mess that it is in where other countries are ripping America off with unfair trade practices. These economists have turned a blind eye, turned their backs to the great damage done to industrial towns and communities across America for two decades with the loss of manufacturing. Take Irwin's point that the US would have to monitor rates on 13000 tariff line items. This is ridiculous because the US simply needs to monitor the key products such as semiconductors, oil and gas, LNG. In just one negotiation with India the US having a trade deficit DJT states of $100 billion with India- terrible trade. By opening up supply of LNG and oil US can fill India's needs for Oil and LNG and cut the deficit to zero. Who came up with this idea. Indian PM Modi and his trade team. Once it was known that the status quo was unacceptable India came up with its own ideas lets import what we get from Russia from the US. Yes we had discounts from Russia but that was when oil prices were high. DJT's effort to get oil prices down by increasing US production will make it possible for India to get this oil at similar prices. India is a much bigger economy now than during Covid 5 years back India can do this. US and India win-win by doing joint aviation production deals and US gains with sale of F-35 stealth fighters. It is just common sense. Sadly, much of this is common sense that is beyond Ivy League Economics departments at American universities.  Reciprocal Tariffs make a lot of sense because this is how fairness is done- for China, for India. In the case of Mexico, Canada, China, on stopping flow of fentanyl- this reciprocal tariff is not a tariff it is as Commerce Secretarty Luttnick pointed out domestic policy of the United States. Which country would tolerate 490,000 deaths from fentanyl over 12 years and not take domesti policy action. It is not that the policy actions are taken it is that these action should have been taken a long time back. ...

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During the Republican Senate campaign in 2022 to replace Pat Toomey, both candidates Oz and McCormick had assets over $100 million according to the Philadelphia Inquirer. This seat was won by Dan Fetterman, Democrat of Pennsylvania. The contrast between the wealthy and the middle class candidates and their distance from average Americans struggling to make a living was very clear, almost similar to the billionaire former president and the Harris-Walz Middle class candidates vowing to rebuild the American middle class atrophied from outsourcing of jobs overseas and wages falling behind cost of living for ordinary workers.

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The difficulties the new U.S. Treasury Secretary faces as she tries to navigate the politics in Congress and the tries to reach out to moderates and progressives within the Democratic party. All have different views on spending, and where stimulus money should go in a second stimulus. Her long experience with the Fed is seen as not preparing her for the political role of evaluating different opinions that are described by some experts as ten times more political than anything going on in Fed meetings. As a student of Prof. Tobin Yellen sees government intervention as needed in times of economic crises. Twice in ten years the U.S. and the rest of the world has been struck by economic crises- the bank leveraging behaviours and poor lending practices that induced the 2009 financial crisis and in 2020 the coronavirus pandemic. Lessons learned Yellen says about the 2009 recession are that not enough stimulus was provided after the initial stimulus to get a strong enough recovery. Democrats are eager to spend over $2 trillion in a second stimulus. Republicans much less so particularly with a new president. Even under Mr. Trump spending was set at under $700 billion by Republicans for a second stimulus. Another economic crises is one of the U.S. strategic economic position in the world. On this issue of trade Yellen's husband George Akerloff, also a economist is more skeptical of the value of free trade. The failure of the World Trade Organization to ensure a level playing field as China subsidized key industries, and the loss of America's manufacturing advantage over three decades is now the defining issue in American politics. It takes the shape of manufacturing communities that were once a part of Democratic party support shifting away after devastated local economies from the loss of manufacturing plants to China. It takes the shape of a Republican party that is committed to bring back American manufacturing, and a Democratic party that under Biden is seeking the same result. How much each party will invest in terms of making things happen to get this done is one of the issues facing all parties, Congress, the administration, Ms. Yellen, and the new president. Economics does not have the answers. As economists could not have predicted the increase in women participation in the workforce, the drop in Black and Hispanic unemployment rates under the Trump administration. The lack of moral will to get trade to work for the American worker was more of an issue under Democratic and Republican administrations for the last 2 decades, so that issues of growing inequality were never better addressed by any party. It depended more on focus of the president elected to help American workers, and to avoid the cost and distraction of foreign wars when American interests could be protected in other ways. Yellen was not able to make a difference at the Fed because of these reasons and low interest rates have both helped and hurt the middle class, as low interest rates meant Americans were less able to accumulate savings for retirement since 2000. Determination and action counts for more than ideology or policy is the lesson learned in building strong economies and manufacturing.   ...

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Biden administration slightly changes wording using  "statehood" as it relates to Taiwan, a well functioning Democracy nation of 23 million people just south of the Korean peninsula. China protests and weeks later it is reversed. The DJT administration is restoring this wording on grounds that US does not want ambiguity, it wants to see a democratic nation be able to follow peaceful coexistence in Asia. Early hints how the world situation is changing with DJT administration's return to "common sense" in policies is that it seeks to bring Russia back into the community of western nations. Restoring relations  reminiscent of when China breaks away from the Soviet bloc in the 1970's, Russia moving away from its subordinate position to China.  American Lt. Gen. Keith Kellogg seeks to avoid losing a whole generation of young people in Russia and Ukraine with continued war. America's idea is consistent with Wilson support of China during Sun Yat Sen's 1911 Revolution, FDR and Gen. Joe Stilwell support for China during the Imperial Japanese Army rampage through Asia in 1930's. America does not want to see fellow Europeans an entire generation of young men from Ukraine and from Russia lose their lives in a senseless war. DJT shows America is listening when he says Russia would never accept Ukraine in NATO and some voices in Europe (British, East European) have made it appear that this is possible.. Kasyanov a former senior Russian policymaker says Russia wants to see a new generation structure replacing old outdated institutions from the Cold War. NATO needs to be rethought, and a new institution be formed to replace it that puts behind us the Cold War. This is also a European idea expressed by Macron and other leaders.   ...

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Jesse Eisinger compares the public criticism and the response of two executives of major American banks- Dimon of JP Morgan Chase and Blankfein of Goldman Sachs. He says Dimon may come out looking better with his reputation in much better shape because of the changes he made at JP Morgan Chase after realizing that he had made faulty judgements. Dimon has now set the goal of putting JP Morgan ahead of the other banks in its risk management and working with regulators. Blankfein is seen as making only minor changes in the culture at Goldman and having overcome a wave of public criticism without significant change in the way the company does business. In the process Dimon will have learned more from the financial crisis and make improvements that will be good for JP Morgan in the future, an opportunity that Blankfein is seen as missing.

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Where did the numbers in the US president DJT's charts come from wjen shown in the Rose Garden on Liberation Day April 2 2025? The number for example 68% for China comes from a ratio- deficit by country divided by total imports to US.  The numerator reflects the US concern about trade deficits. It is exports minus imports for China in this instance. In 2024 China's exports were $438 billion to the US. It's imports were $143 billion. The difference is the surplus or deficit China has with the US. China's surplus is $295 billion. China's surplus is also America's deficit with China when turned around and seen from the viewpoint of America. The denominator reflects the US concern about how much it is importing from each country- this is how much it is not making inside America and which it has to get from another country. The more that it imports from another country the less it makes at home. If labor in the US gets too costly and is not cooperative to make well designed reliable products more factories close and are build outside in another country. This has consequences- serious consequences over time as it spreads to different industries. FOr the first time in history. A foreign nation makes practically everything and US acts only as a consuming nation- this means the workers jobs and incomes in the US are destroyed. It is often a sign of serious decline in the Nation. $295 billion/$438 billion is 67%. This is the China number shown on DJT's chart in the Rose Garden. The tariff and non tariff barriers and currency manipulation that China conducts in trade with US is measured in this way as an estimate, much higher than actual tariffs which is why US products don't get the treatment they deserve in China's market.   ...

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Dana Goldstein of the NYT looks at the big problem in education today- the failure to teach reading and writing skills to students in American schools. Goldstein cites two alarming statistics. About 40% of students who took the ACT writing exam in the high school class of 2016 lack the reading and writing skills to pass a college level composition class in English. 8th and 12th grade classes in the U.S. have 75% of the students lacking writing skills proficiency, according to the National Assessment of Educational Progress. Of the 1204 comments to this article in the NYT, many of the 17 selected by NYT say the problem is that students lack reading skills. Other problems shown here are the handicaps created by technology, yes technology. Mobile phone use is common and this is done quickly with the least attention to write good sentences, little attention to punctuation, spelling or grammar. Half or incomplete sentences are easier to type on mobile, so a new generation grows up thinking that this is normal. As a result a whole generation of kids have not learned to read or write well, constructing sentences with limited vocabulary. Steve Jobs and Apple may say that iPads and iPhones, smartphones and other tech devices have advanced reading with the beautiful display technology screens, but this is not what is really happening. Google may say that its search helps people access good reading materials, and this too is not what is really happening.  Equally alarming is that there is no clear agreement on how to tackle this problem. The No Child Left Behind 2002 law set a program emphasizing reading and use of multiple choice questions to test reading skills. This was followed by the Common Core standards now implemented in schools for 6 years that shift the focus to writing. Yet the results are still the same, showing little progress. Goodman cites as examples of disagreement, the Writing Revolution project which focusses on grammar and other writing skills, and the Long Island Writing Project that focusses on students finding their own voice by freewriting. A student in the freewriting class which encourages finding your own voice, expresses her frustration by saying she doesn't hear a voice- what voice, she asks.  One of the problems is that teachers themselves lack writing skills. A look at 2400 teacher preparation programs shows little attention paid to teaching writing. The head of the Reading and Writing Project at Columbia University's Teachers College, says Common Core failed in implementation of massive teacher training, which is required to address the problem. As a result remediation programs are needed badly in colleges to fix literacy skills, when better teaching would have prevented the problem in the first place. Little understood or debated is that every generation has to learn about the country's democratic institutions, every generation has to make its own effort to gain civic literacy- it is not something that can be taken for granted or handed down from one generation to the next. Without reading and learning about how these institutions function, young people lack the skills for participating in our democracy and in the global economy. ...

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This article by Michael Shifter, who heads the Inter American Dialogue, says it is important there be an amnesty for the military officers so that Venezuela can make a peaceful transition with an interim government that meets the international community's call for new credible elections. He says the head of the National Assembly who heads the interim government has taken the right steps to ask for an amnesty for the military from the National Assembly.

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UBS and Bank of America reach a settlement with Detroit before the city declared bankruptcy. The settlement was for interest rate swap contracts signed by Detroit officials in 2005, and settles the contracts for 75 cents on the dollar or $230 million. There is safe harbor for traders and banks in interest rate swaps or derivative contracts, so that the usual stay that blocks creditors from collecting debts does not operate. This kind of treatment for derivative contracts makes no logical sense in the context say experts. The swap contracts of 2005 were signed at a time the city took out a $1.4 billion variable interest rate loan to put into its pension funds, with the swaps as a hedge against rising interest rates. In fact Detroit is seeking a $350 million loan from Barclays Capital and it needs to resolve the swap for that loan. From this loan UBS and Bank of America get their $230 million leaving $120 million for streetlights, police and city services badly needed today. Public interest considerations of this kind were not considered by Congress when it made the rule for safe harbors universal in derivative contracts to reduce systemic risk of one financial institution dragging others into a systemic crisis. The safe harbor make it harder for a judge to say this thing smells and make attempts to change it. ...

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With more vaccines available from Pfizer and Moderna, and the poor SinoVac Chinese vaccine effectiveness against the Delta variant, Brazil and other countries in Latin America and Asia are shifting away from Chinese vaccines. Brazil's federal government has halted negotiations for additional doses of Chinese vaccines. In the early stages in 2020 Chinese vaccines helped Brazil cope with the devastating rise in cases. The slow pace of vaccinations in US and Europe has freed up more vaccine doses of Pfizer for other countries including Brazil. From accounting for 80% of vaccines in Brazil early in 2020, SinoVac vaccines now make up only 35% of Brazil's vaccine doses. At that time Brazil bought 100 million doses of SinoVac vaccine which were delivered. The local producer of SinoVac vaccine, the Butantan Institute will no longer make Chinese vaccines. While Sinovac vaccines are effective at preventing deaths, the vaccines have a low effectiveness rate for symptomatic infections. ...

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Historian David Kennedy says the present situation of partisanship after the midterms is not unusual in American history. He compares this to the election "waves" in the Gilded era of the late 19th century. He says sometimes a fractious democratic people need this kind of indecision, shuffling, avoidance and confusion, before they make up their mind to address the tough issues with which they are faced. These knds of "wave" elections do not show a weakness in American democracy. It should lead to an effort to summon up the courage to deal with these tough choices, and the creativity to find innovative solutions, and the will for taking strong action. An example he says is the pent up energy, the demand for some kind of meaningful solution to the real issues of the time about a century ago that led to the Progressive era. The result eventually was the leadership of Republican Theodore Roosevelt and of Democrat Woodrow Wilson, who brought new vitality to the American political system, and initiated the process of writing laws and building institutions that would help America cope with the complexities of the emerging industrial society....