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This New York Times editorial says a smaller Wall Street and growing jobs in other fields will be good for New York as well as good for the country. It says New York politicians should focus on finding new ways for New York to broaden its tax base and get new businesses and new opportunites in fields such as media, advertising, entertainment, health care and tourism. Especially welcome are initiatives such as the science and tech campus of Cornell University promoted by Mayor Bloomberg. Tighter financial rules and higher capital requirements are good for the country and for New York the editorial emphasizes, because they help control reckless banking practices that destroy capital and opportunities for growth elsewhere in the economy. It points to Kevin Rose's Nov. 21, 2011 account in the Times showing a healthy culture shift in New York and the country with the status jobs being seen not at Goldman Sachs but at Google, Apple and Facebook. Rose's account shows that in the last 3 years the number of Wall Street employees of ages 20-34 declined by 25%....

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Robert Gordon of Northwestern University describes the problems in American Education and how this is the first generation which will not do better than its parents in educational attainment. The cost says Gordon comes in lower potential economic growth rates.

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Krugman points out the gains on three fronts evident from the Census Bureau report of 5.2% gain in median income of households in the U.S. He says the first is the growth in incomes of ordinary working class and middle class families, second the large decline in the poverty rate, and third the further rise in insurance coverage in 2015 for people without health insurance. He points to the steady efforts of the Obama administration to improve lives of ordinary families as working based on the Census report though results have taken time, and could have been better. The Stimulus, says Krugman could have been larger following the blow of the 2009 financial crisis and increased unemployment at the time. Janet Yellen at the inequality conference of the Boston Fed in 2014 pointed out the problems of 62 million households having net worth of about $10,000, and why this was running against the American idea of a better life for all Americans. In that sense the Census report is a movement in the right direction but a lot remains to be done.   ...

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Fomer Defense Secretary Leon Panetta says America needs to take up a vigorous foreign policy in his book "Worthy Fights." Both Panetta and Hillary Clinton, and Gen. Dempsey of the Joint Chiefs, Gen. Petraeus of the CIA, supported U.S. taking a strong stand in Syria by supporting Syrian opposition forces in the summer of 2011 and were overruled by president Obama and his election advisers because of the approaching 2012 election. Here Mark Landler provides more insights into Hillary Clinton's deeply held belief shared with Panetta that the U.S. had to take strong action where necessary to deter foes, to get into the ring to use Panetta's expression. The U.S. support for action in Libya to support Britain and France comes from the efforts of Clinton, and any lack of followup one of president Obama's errors in foreign policy. In April 2016 president Obama said that he considered his failure to followup in Libya to help the new Libyan government his biggest mistake in his presidency. Here Mark Landler looks at Hillary Clinton's entire career as showing a conviction and belief on the need for action where necessary in the U.S. global engagement. Compared to the bluster of the candidates Trump, Cruz and Sanders, with little experience to back this up in their careers in real estate, law or the Senate , Landler says Clinton is the last remaining hawk. Here he describes Hillary Clinton's contact and empathy for the troops from her trip to the American base in Tuzla, Bosnia, in March 1996. In fact many have forgotten that Yugoslavia is what it is today after the Milosevic years and the ethnic wars with Slovenia, Croatia, Montenegro, members of the EU and Serbia negotiating to enter EU, because of the bombing campaign taken by Bill Clinton through NATO in 1999 to prevent ethnic cleansing in Kosovo, and peacemaking following the Bosnian War using diplomat Holbrooke to negotiate the 1995 Dayton Accords. Here Landler describes the meetings with Gen. Keane who pushed for the troop surge that worked in Iraq under president George W. Bush. Clinton supported Keane's proposal made in April 2015, for a no-fly-zone in Syria that would help opposition forces till a settlement could be negotiated. Keane pointed out to Clinton that there was a flaw in Obama's policies- that negotiation would work only if the no-fly-zone was used to support opposition forces. By the end of 2015 Hillary Clinton publicly adopted this position. During a period when Americans are weary of foreign entanglements but understand the need to provide leadership where needed, Hillary Clinton, provides a balance between the pendulum swinging too sharply in one direction in the Bush years and in another direction in the Obama years, says Landler. A view also articulated by Leon Panetta, who was chief of staff for President Clinton during the Bosnian conflict and the Dayton Accords, where the U.S. showed strength of purpose in war and also in negotiating the peace without major entanglements....

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Prof. Peterson of Harvard and Hanushek of the Hoover Institution, authors with Woessmann of the book "Endangering Prosperity: A Global View of the American School," offer some startling reminders about the importance of education to economic growth and incomes in countries. Simply by raising the math standards in the U.S. to the higher standards in Canada would raise GDP by three fourths of one percentage point. One advantage that the U.S. enjoys comes from its good university systems, open markets, rule of law, tax rates, and open immigration policies, which give it about two thirds of a percentage point in higher GDP growth per year. The estimates are from the authors calculations. For the period 1960-2009, a period of rapid growth in Asian countries Korea, Taiwan, Singapore and Hong Kong, higher test scores in math and reading compared to the wrold average as measured by NAEP test and PISA, have led to 2% higher GDP growth. NAEP shows only 32% of U.S. high school students proficient in math compared to 45% in Germany and 49% in Canada and 63% in Singapore. By contrast to Korea and Taiwan, Peru, Argentina, the Philippines and S. Africa have about 2% less in GDP growth because of lower scores compared to the world average....

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The failure of the MF Global Board of Directors to question the huge bets on European sovereign bonds taken by Jon Corzine. This board had members with sophisticated knowledge of financial markets. Then why did it act passively, asks Davidoff. Boards have some of the same blinkers that the CEO has, and may have been led to believe that this was a good course of action. Failure of boards of directors in recent times include a long list- Lehman Brothers, GM, H-P, Toyota, most recently Olympus, and others. In some cases as with Corzine and the head of Lehman, one sees a headstrong executive with a history of success, in others as at GM and Toyota the Board is stacked with members selected by or favorable to voting with the CEO. And at H-P or Olympus, an inside group that runs things the way they see fit. Most boards of this type are highly insulated from outside opinion, and highly confirmed in the correctness of their own opinion even when the situation has dangerously deteriorated.

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Kessler in the WP corrects Obama's claim that he created 800,000 jobs. He says this is clever arithmetic as it takes a low point in Feb. 2010 following the financial crisis. Kessler points out that according to the Bureau of Labor Statistics, U.S. manufacturing jobs were 12.56 million in Jan. 2009 when Obama became president. In Nov. 2016, early estimates show there were 12.26 million manufacturing jobs, a loss of 300,000. This loss does not reflect the problems in the U.S. auto industry and older industries in the midwestern states as a result of trade and globalization that speeded up with the rapid industrialization of China. And led as Greg Ip pointed out in a recent WSJ report to a rapid acceleration of job losses in a decade that did not happen in the same scale during Japan's industrialization and urbanization in the sixties. This aggravated the situation in Michigan, Ohio, Wisconsin, Indiana, and Pennsylvania, and was met with a feeble response from Democrats. Even a economist like Krugman favoring the Obama administration's efforts came to the conclusion that TPP did not add much to gains from trade as most of the gains had already been realized. More of the gains went to tech and IT in California, at the expense of the auto industry based in the midwest. A report in WP show a president too close to IT in California and failing to grasp the situation in the midwest. Voters punish whoever is in power, regardless of being Conservative or Liberal, in Canada the hollowing out of manufacturing under Harper in Ontario and Quebec led to the win by Trudeau's Liberals.  ...

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A shift in priorities away from focussing on high growth to lower sustainable growth was announced by China's premier Wen Jiabao at the National People's Congress, China's parliament, in March 2012. This shift will reduce investment in infrastructure, power generation and exports, which will affect the level of imports of commodities from commodity producing nations in the Middle East, Australia, Canada and Brazil. It should increase imports of software, computers, entertainment, tourism and high tech goods from the U.S. and Europe. Chinese leaders have said they would make this kind of shift for some years now but growth has consistently increased more than the target rate, and domestic consumption as a percentage of the economy has actually decreased in the last decade. Now 9-10% growth rates may be a thing of the past and the target of 7.5% set this year may be actually closer to the real figure. The Chinese leaders have belatedly realized the need to make these changes now because slowing markets in Europe -which is seeing declining growth and high unemployment- and in the U.S., make the issue impossible to avoid. Wen told the Congress: "Accelerating the transformation of the pattern of economc development... is both a long term task and our most pressing task at present... Domestically it has become more urgent but also more difficult... to alleviate the problem of unbalanced, uncoordinated and unsustainable development." This is his way of saying that its unavoidable and better to start in earnest now, and at the same time recognizing the resistance to change from the stateowned companies and the other interests who have benefitted from surging growth, and now occupy a central role in the power structure. An opinion article in the People's Daily, China's official newspaper, said: "imperfect reforms are to be preferred to a crisis caused by no reforms." The World Bank's president Zoellick is respected by the Chinese leaders. He also urged them to make changes now. The recent report of the DRC, China's planning research arm, and the World Bank, also laid out the new direction away from a focus on infrastructure to domestic consumption. The fear is sudden deceleration in the absence of policy action. The impact of this will be negative for commodities over time, leading to slower growth in Australia, Brazil, and Canada. It should boost imports from Europe and the U.S. of high tech, consumer, pharmaceutical goods over time....