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Louis Uchitelle talks to Stanley Moses, an economist at Hunter College in New York, and others, to find out if things will work out as expected with the $700 billion or $800 billion that Obama plans to invest in infrastructure, energy, and other things to generate the 3 million jobs and investment. Will this generate private investment like the Interstate Highway program which ocurred during the Eisenhower days and set the economy on fast growth, or will it generate enthusiasm and jobs for a few years, and just as Roosevelt backed off in 1937 to let private investment pick up he found that it was still too weak to make a difference. The point that he hears from some experts like Moses is that the current times are setting up for a deep downturn, so that is not reminscent of the Eisenhower years when the economy was getting on the growth track after the war years. Its not exactly like the Roosevelt years either, because of the many changes that have ocurred in a modern economy, but in terms of the mood, the collapsing investment, consumer spending and credit and the collapsing growth in emerging markets which hits exports, this is a situation that is not easily reversed with a few years of aggressive government spending. Things have to change in the public's mood and in private industry's initiative to invest that would return the economy to a growth pattern, and this may be a long time coming with so much deterioration happening at the same time....

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This report from Brazil is of major relevance to India in its growth efforts, and for aging societies such as China. In many ways showing the price countries and the people pay when growth is mismanaged. A major crisis is hitting countries such as Brazil as fewer young people and young workers support an aging population of retirees. This is to be seen in the money allocated in Brazil's budget- only 3% goes to infrastructure, 3% to education, health gets 7%, and retirement system takes up as much as 43% of the budget. Increasing retirement obligations are nearly bankrupting the Rio de Janeiro state government.  At the core of this crisis is a steadily aging population that is happening now faster than in the developed world. Also part of this is the fact that fertility rates have dropped rapidly in Brazil, the rest of Latin America, and in China. It took just 27 years in Brazil and 11 years in China for fertility rates to drop from 6 to below 3, creating a situation where there are fewer young people to join the workforce as retirees live longer and the retired population increases. This report shows that it took 82 years for the fertility rates to drop from 6 to 2 in the U.S. so that the U.S. had a longer period in which to build up infrastructure.  Only 50% of Brazil's sewage is treated, and sanitation systems need investment. The average adult has about 8 years of schooling. An unfunded and unfundable social security system means infrastructure, health and public services such as transportation will remain unfunded for years to come. China's policymakers have done far better by building infrastructure rapidly yet face the same squeeze of aging population lower fertility rates as China's modernization continues. India needs to learn from such failures and successes in framing its own policies. Unrealistic giveaways or promises such as Brazil's retirement age of 55 and poor priorities of soccer stadiums in the northeast over sanitation, health, education, have a steep price. Good intentions are not enough as the Workers Party in Brazil granted pensions to farmers and informal workers without generating the sustained growth needed for funding the pension system, with $3 billion paid in and $36 going out for this added benefit.    ...

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Washington Post Analysis and reporting shows Russian economy is now sensitive to cuts in oil purchases by India. Russian economy with $213 billion a year in the war effort would suffer from higher inflation and interest rates higher than current 18% if India cuts Russian oil purchases of about $119 billion a year. A shift may be already taking place as India buys more from Saudis, UAE and Iraq. Studies by CLSA cited in the Economic Times show India gaining only about $1 to 3 billion by buying Russian oil. India has much more to gain by shifting away from Russian oil. Russian inflation is at 9% and the economic growth is about 0.4%.  A further increase in interest rates from 18% in a war time economy could kill the civilian economy say experts in Russia the Washington Post has talked to. About 17% of Russian refineries production is removed by Ukrainian strikes on refineries in Russia, leading to higher prices for oil. More crude oil is being exported instead of refined product as a result. This explains why the US under president DJT decided to take the difficult step to deter India from Russian oil purchases as it would not have been able to get China to reduce its $136 billion Russian oil purchjases each year the way it could for India. This was done to end the war even though it is little understood in India.  ...

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Inida' slowdown from 9% to 6.7% growth rate is mainly the result of lower private consumption says the Economis, as the contribution to growth of private consumption dropped by half in 2008. Which is why it sees the handouts to consumers through tax cuts and welfare spending making sense in the short run, even as India's finances are stretched. After a 36% increase in government spending in this budget, the fiscal deficit is estimated to be 12% in 2009, including "off-budget" items. Increasing the efficiency of the fertilizer subsiies by putting it directly in farmer's hands instead of fertilizer makers is a priority, as this takes up 1.5% of GDP.

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Gao Xiqing, vice chairman, president of China Investment Corporation, told a panel discussion during meetings of the International Monetary Fund, on September 24, 2011, China cannot be expected to provide solutions to the eurozone debt crisis. Xiqing said: "We're not saviors. We have to save ourselves." He added that CIC would consider buying bonds of troubled eurozone countries -"if it has a risk profile that fits into our allocation, but don't expect us to buy more than our risk appetite would take." And the head of China's central bank, Zhou Xiaochuan, told the panel that China cannot raise its growth rate because of inflation and other problems from unsustainable growth.

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Ariana Huffington of the Huffington Post recalls her days growing up in Athens. She says from her own personal experience that the children should not be penalized for the mistakes of their parents, that the next generation should not have to live desperate lives for the next decade under ECB policies that leave no room for growth. She adds her voice to voices in France, Spain, and other countries in the eurozone about the impact of current EU and ECB policies on Europe, and says exiting the eurozone is a difficult option, but like the Argentine example offers more hope for growth for the young generation in Greece.

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Liam Denning of the WSJ points out that the third quarter GDP numbers of 3.5% growth don't signal much beyond low quality numbers. WIth government distorting the cost of money, and pumping up demand for cars and housing, and in other ways propping up the economy all this good news may create a false sense of complacency, when as Denning says its only storing up problems for the future.

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WSJ shows breakdown on federal spending hikes and cuts in the big DJT US Tax Bill. 2025 US Tax Bill renews the tax cuts put in place by Trump in his first term that expire in 2017. About $2.75 trillion in spending increases are not offset says WSJ. Briefly it has spending hikes for $2.18 trillion      DJT Tax Cuts from first term  $1.31 trillion       Increase Standard Deduction $820 billion         Deduction for businesses $797 billion         Child tax credit $1.41 trillion        Limits on Alternative Minimum Tax The goal is to promote business growth and help small business owners, parents with children, help ordinary Americans take more in take home pay during cost of living pressures for the average American. Savings come from $1.87 trillion repealing personal dependent exemption and $916 billion from capping state and local tax deductions. Added savings from repealing clean energy tax incentives and EV credits. Increasing work requirements for Medicaid saves $625 billion, tution aid cuts $346 billion, $300 billion from SNAP changes.   ...

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An export rebound is not matching the growth in imports. Imports went up 31% since May 2009, while exports went up 27%. The result is that the trade deficit is growing, primarily because of imports from China and imports of costlier oil. The trade deficit is expected to reach $40 billion in December 2010, compared to $25 billion in May 2009.

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Zaragoza a city of 700,000 is the capital of Spain's fastest growing region, and its halfway between Barcelona and Madrid. It has grown rapidly. The arrival of GM here was a big turning point in 1982. The GM plant here can turn out 2000 sub compacts, small minivans and delivery trucks a day, now it is one of 7 GM plants in Europe to suspend production for 2 weeks in October to work off inventories. About 600 of 7000 workers were laid off. Young people here who have never seen anything but good times see this as a big shock. And its a sign of how things across Europe are shaping up. Spain's economy contracted by 0.2% this summer. The European Commission expects the 15 nation eurozone to be flat next year with no growth, but this is an early estimate and may be revised to show a contraction as the economic downturn is just beginning.

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Mr Mussa's forecast at the peterson Institute of Intenational Economics shows world economic growth moderating from 4.75% this year to 4.25% in 2008 and 5.25% in 2006 with continued global economic expansion. The IMF is expected to forecast USA economic growth slowing to 1.9% in 2008 from 2.8% in an earlier forecast. The IMF global forecast of 4.8% for 2008 is in line with Mr. Mussa's estimate. The IMF trimmed eurozone growth to 2.1% in 2008 from 2.5% . One reason given for the resilience in USA growth is the boost to US exports from the weakening dollar and the increase in worldwide demand, so by these estimates the housing crisis will be offset by general global economic growth and factors such as exports and its impact will be softened. Also eurozone growth will continue especially Germany, France and eastern europe whereas Britain and Spain may see some fallout from housing bubbles. Overall growth in India, China, Middle Eastern countries, and other parts of the world, including Germany, and export led growth in the USA will keep the global economy in decent shape. general increase in exports as world demand contimues to grow....

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The BBC's Soutik Biswas takes a look at prime minister Modi as he seeks a second term in India's general election in May 2019.  Modi's first term is marked by exceptional development schemes, efforts to provide health insurance to 500 million people who cannot afford health insurance, bringing cooking gas cylinders to hundreds of millions of Indian women especially in rural areas, efforts to jumpstart building of infrastructure projects such as airports and metro subways. A new law for GST brings together the country with one tax instead of a hodge podge of state taxes for interstate commerce, something India needed for a long time but different governments failed to implement. A failed effort to fight corruption by removing from circulation large denomination currency notes reduced economic growth briefly during the first term, though it may have accelerated the shift to formal economy needed in the long run to improve tax revenues for development needs. One of the problems for the Modi government is how do you put a value on something like Swach Bharat Mission, the achievement of the goal of defecation free India in 2019 by 100% on the 150th anniversary of the birth of Mahatma Gandhi, getting rural toilets up from 38% to 100%. Development had to start from the bottom up. Similarly in a country where middle men took up a lot of the transfer to poor families of government assistance- the delivery to hundreds of millions their own bank accounts.- how do you put a value on something like this, but it is essential for development from the ground up. More than missiles or other talk this has got to be the spirit of any development oriented administration in India. Ground up, big goals and rapid delivery and an apology for the difficulties that the people suffered earlier for lack of this infrastructure. For both China and India it is the same - moving quickly to make up for 100 years of colonial rule and stagnation. The Modi government has responded to rural farmer distress with support for guaranteed crop prices. As more young voters vote for the first time an important factor is how the new voters see the years ahead under either a government led by the BJP or by a patchwork of parties as the previous ruling Congress party depends on alliances with other parties with conflicting agendas or lack of rapid development agendas. The Modi government sees itself as setting the stage for the next phase of development that would change the economy through new infrastructure development and create jobs in construction and engineering, and other areas. The criticism is that not enough jobs were created in the first term. Yet bold infrastructure development targets such as transformed the Chinese economy could be the answer for job creation. The question then is who is better qualified to launch that effort based on its track record. The Congress party's main criticism is that it has to make alliances with parties that could stall development with conflicting agendas. The other is that in the the 2 years leading to the election of Mr. Modi the Congress led government of Manmohan Singh was stalled due to corruption charges, leading to a lack of decisionmaking at the highest levels, and stalled efforts for the rapid development that could deliver the kind of jobs India needs.  Young Indians would like to see growth first and foremost, only something rivalling China's transformation over 2 decades can do this. It should be kept in mind that China poured more concrete in the 21st century so far than all the concrete the United States poured in the 20th century, according to The Guardian report. The question then is who is best qualified and in a position to deliver this needed economic miracle.    ...

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As HP separates into two separate companies that can be focussed and nimble, CEO Meg Whitman says that it has been a difficult road for HP. The new organization will have a lower cost basis by making job cuts as HP sales shrink- about 30,000 additional job cuts will be made in addition to the 55,000 announced earlier, mostly in enterprise services as the outsourcing operations have declined. HP sales and profits have declined with profit of $8.76 billion in fiscal 2010 on $126 billion in sales dropping to $5 billion in profit on $111.5 billion sales by fiscal 2014. Meg Whitman, CEO, says this should complete the changes and set the business up for future growth in new business areas. She also says HP has not done anything stupid in the last 4 years, alluding to the losses on the ill advised Autonomy acquisition. A big shift is being made in the Enterprise Services Group by setting a rule that no single account should be more than 10%- in 2013 just 3 accounts made up 65% of operating profit. One area of growth is cloud computing related business where it sees revenue growth of 20% for the next couple of years. Other areas include data analytics....

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The Chinese car market is changing fast, with domestic brands making up a larger share of the local market. In 2000 these domestic brands made up 18% of total sales, whereas in 2010 forecasts show this to be about 32%, with the share increasing in future years. In a rapidly growing market this did not make much difference, but with the market growth moderating to 7-8% in the next ten years from the heady 33% of recent years, the foreign brands such as GM and VW will not see the growth of recent years. J.D. Powers projects passenger vehicle sales in China at 19.2 million by 2017, with Chinese brands taking 45% of the share, in one scenario. Under this scenario foreign brands like GM and VW would see sales growth of only 5% in the next 7 years. The foreign brands are not allowed to own more than 50% of local operations. And their partners are making their own domestic brands. If Japan is a useful example, China's automobile companies will like Nisssan, Toyota, and Honda, proceed to penetrate global markets and become a dominant player in their local market. This has implications for GM, VW and Daimler....

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The new budget in France is designed around two goals. The first is to take aggressive action to bring the deficit down to 3% by 2013, not a gradual program but one intended to send a strong message to capital markets that France under a Socialist government is dead serious when it comes to the deficit and debt reduction. Every 0.1% increase in France's borrowing rate would mean $260 million going into interest payments on the debt, according to Pierre Muscovici, the finance minister. France's borrowing rate is close to Germany's 1%, and the French are determined to keep it this way. The other goal was stated by Mr. Muscovici: "I don't want a policy of austerity, hitting salaries, weakening the state and turning it into a pauper." The idea being that hitting the common man would mean decline in consumer spending and lower growth and tax revenues that would create the kind of negative spiral facing Spain of declining growth and rising unemployment, worsening deficits, and higher debt payments. The way Muscovici raised the $39 billion- beyond the $9 billion in higher taxes and savings already implemented for 2012- is through $13 billion in new taxes on corporations, and additional $10 billion from new income taxes, including a higher tax rate of 45% on incomes over $193,000. Additional $13 billion will come from a freeze in public spending, so that some ministries take cuts adjusted for inflation keeping the overall budget the same. Spending cuts could come later to balance the budget as growth picks up to 2% in 2014, is the government reasoning, softening the impact. The new budget is well received by German public opinion as showing the resolve of Germany's key partner in the EU. Part of the reason the French are able to get business and people with higher incomes to contribute is that France is unique in that there is a greater consensus than in other countries on the steps needed and a sense that austerity measures targeting the middle class would be counterproductive. The aggressive action with considerations for equity and fairness also gives France the chance for a faster turnaround and avoid the problems plaguing Spain and Italy, which French public opinion and business appears to have grasped and the government's experienced ministers for the economy have successfully presented. ...

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Jaishankar on the connection between the Indian and Pacific Ocean region into one integral whole with the emergence of independent nations from the British, French, and Dutch Empires in the region, and the growth of Indonesia, Malaysia, Singapore, Vietnam, Philippines and Thailand. The growth of trade and use of sea lanes for supply chains, modern shipping and logistics, have created sea lanes that stretch from the Gulf and Suez to Hawaii and Seattle. India plays a critical role with the US, Australia and Japan to ensure international law and open shipping lanes for all nations in the Indo-Pacific. Jaishankar also touches on infrastructure developments such as the new Trilateral Highway that connects India's northeast to Burma and Thailand. This opens up ties on land between the three nations with connections into Malaysia and Indonesia. That would enhance the movement open people and goods, and cultural connect that would create a new northeast- southeast Asian connection. It restores what was the long lost connection that India once had with nations from Thailand to Indonesia, and Vietnam to Japan through China. This is the connection that brought Buddhism from India's north east in Bihar and Uttar Pradesh to these countries.  Look East, Act East, the Quad, Indo-Pacific Economic Framework are all ways of saying the same thing of making the East connections the vital ones in India's social, economic and political, cultural life, restoring the connections in which India thrived and existed as one entity. It also brings life to the Gulf countries which are otherwise isolated in a sea of European nations on one side of the Mediterranean and Russia on the other side near the Black Sea that have different historical interests and cultures. This sees the central Asian connections through Afghanistan as being secondary and of less significance in the long history of nations such as India, China, Korea and Japan from the Buddhist era. That secondary connection brought an interruption of the long Buddhism and Vedanta civilization in India, intermittent wars, and the division of the country under the British Empire. It is a natural progression in a long history that seeks to restore the natural and intuitive connections to the Vedanta and Buddhist regions in the East that are part of the Indo-Pacific. These are now integrated with the settlers from Britain who sought to build better and fairer societies based on the rights of man in the new nations of Australia and America. This gives new life and meaning to this vast Indo-Pacific region. The British Empire and the other colonial empires simply bring back an orientation to the period of colonial wars of the nineteenth and twentieth century, which tore apart China and then Japan, and used resources in India for these wars, and which ended with the atomic bomb in Hiroshima and Nagasaki. These wars also leave behind memories in China, Indonesia, Vietnam, Japan and Korea that can only be truly be put behind by looking at Vedanta and Buddhist Asia as it once was from India to China to Japan. And to the regions of Australia and the US that brought new meaning to the modern scientific period and the rights of man in settler societies away from Europe. ...

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VW sales including Audi were up 34% in 2012. BMW sales were up 14%, and Daimler sales were up 15%. The growth rates for the German automakers surpassed growth in China. By manufacturing in the U.S. German automakers are better able to compete with the Detroit and Japanese carmakers in pricing. A third of BMW vehicles and a fourth of VW and Mercedes vehicles are now made in the U.S., according to LMC Automotive. VW has invested about $4 billion in the U.S. since 2008, including investment at a plant in Chattanooga, Tennessee. The German carmakers are now going for mass appeal with the VW Passat. Lower priced Mercedes models now sell for under $30,000. German exports to the U.S. increased by 24% in October 2012, compared to 18% for the eurozone overall. About 40% of German exports to the U.S are autos. Eurozone exports to the U.S. were up 18% in Oct 2012, and Britain's exports increased by 11%. British exports in Oct 2012 of 4 billion euros were second only to Germany at 8 billion euros....

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The US may just move on to other priorities if both Russia and Ukraine cannot come to terms on a ceasefire, says Marco Rubio, US Secretary of State. The crux of the problem from the beginning were eastern regions of Ukraine that are more Russian in culture than western Ukraine. On the Russian side it was a loss of respect from the capitalist states US, UK and Western Europe compared to its historical importance in Europe, as everything was measured in GDP terms. The last straw was NATO and Ukraine with its Russian connected history joining it. By drawing eastern Ukraine into its orbit Russia was responding to actions by US and the EU support for Kiev, ignoring Russian perspectives. On the Ukrainian side the issue came down to Ukraine being able to decide its own future. Because of corruption and mismanagement, poor governance what could have happened with a clean governance and efficient growth oriented leadership working with Russia and the EU never happened. The result was veering from a pro-Russian to a anti-Russian government following the Maidan protests in Kiev in 2013. Enter China by 2019 with support of US companies shifting almost the entire US industrial base to China. Putin was handed a rare opportunity to act with China's tacit support to push back the US and EU and their defense arm NATO. He decided to take it thinking this would end quickly with Ukraine capitulating. The loss of hundreds of thousands of young Russian youth in the land war led to Russia getting entrenched into this war. As has happened before Russia with it's greater population and resources has prevailed in Eastern Europe over centuries of warfare. This is the situation in 2025 when DJT seeks to end the war and bring peace to Ukraine. ...

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It may come as a surprise that even a conservative Republican Senator Lindsay Graham of South Carolina, talked recently on CSPAN television about the US needing immigration in an organized manner to meet the growing shortage of workers in the coming years in the US. This report by Alicia Caldwell in the WSJ looks at the city of Topeka, Kansas, home to University of Kansas in nearby Lawrence, which is trying to attract immigrants who are allowed to work to meet 6600 worker positions that remain unfilled. Mayor Michael Padilla of Topeka is a cross between a liberal Republican and a conservative Democrat as are many immigrants from countries in South America. The Greater Topeka Partnership is looking to attract Spanish speaking people to fill these jobs, because of stagnant population and a lower unemployment rate than the US average. This effort in Spanish language has resulted in 10,000 resumes submitted. Another effort for Uniting with Ukraine has brought 160 Ukrainians to Topeka. These efforts are happening since 2019 and in some cases the city has offered $15000 a person for relocation costs. Citywide the effort is being welcomed including the business community. Topeka, a town of 126,000 is home to 17% Spanish speaking residents. Molly Howey who heads Go Topeka and the Greater Topeka Partnership is shown here, and says Topeka had already had success with its Spanish speaking population when it started welcoming new immigrants.  The rapid recovery of the US after the pandemic and its resilience for growth over the next decade is creating a recognition among Republicans as well as Democrats, among economic planners and business of the need to fill shortages of workers as the US invests trillions of dollars in its economy in coming years in infrastructure, manufacturing and and new technologies. It is an effort that is unprecedented since the post war effort to build a modern economy in the 1950's. ...

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Chapman points out that the Phillips curve did not hold in low inflation years since 1948 when low inflation was accompanied by low unemployment and higher growth rates. It did hold in the higher inflation years after 1948 when higher inflation was accompanied by high unemployment and low growth rates. So can the Federal Reserve hold onto the idea of a Philips curve hoping that higher inflation will somehow lead to lower unemployment and higher growth as it lowers interest rates. What it may end up doing is hurting the dollar, while increasing inflation and leading to lower growth. Without the demand for Treasurys the way there is now because of the confidence in the dollar, interest rates would rise and domestic savings would be diverted to service the debt, and output would be lower and prices higher. McKinnon at Stanford and others have been arguing the case for a strong dollar in the WSJ recently. Chapman is accepting that interest rate cuts may help the economy but only by a little bit in the current situation and temporarily because there are too many forces at work pushing the economy into recession. So the comparitively small dividends from interest rate cuts should not be allowed to give up the bigger dividends from having international confidence in the dollar not erode. Especially as the current market imbalances cannot be fixed by the mechanism of interest rates, and its not the Fed's job to fix the considerable challenges facing the economy today which will take time to work out and require political leadership from Congress and a new President....

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The July 2017 unemployment rate drops to 4.3% from 4.4% the prior month. The Labor Department reported nonfarm payrolls up by 209,000. One in four of these jobs were in the restaurant business, resulting in more lower paying jobs. Economic growth remains low at 2%.

A better gauge of the jobless situation is the U-6 which includes underemployment and people on parttime jobs looking to work full time, and people who have stopped looking-it is at 8.6% in July, same as the prior month. It was 7.9% in late 2007 before the financial crisis.

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Jack Horton of BBC Verify screens the former president Trump's speech at the Republican National Convention. “Our crime rate is going up, while crime statistics all over the world are going down".  Fact: FBI data shows crime down 6% and a drop in the murder rate by 13% in 2023. For the First Quarter of 2024 crime down by 15% and recorded murder rate down 26%. "We've had the worst inflation we've ever had under this person [Biden]. I will end the devastating inflation crisis immediately, bring down interest rates and lower the cost of energy . We will drill, baby, drill."  Fact: Inflation went up to 9.1% from 1.4% at the end of the Trump term in the first 2 years of of the Biden Administration by June 2022. Biden and Federal Reserves Powell brought this down to 3%. Explained: This inflation jump to 9% would have happened from supply chain in China for Trump administration as well. Trump's last year was 2019 the Covid pandemic started in January the lockdown by midyear meant sharp drop in demand and little room for inflation. The concentration of supply chain in China was the cause of the surge in inflation as China shut down and restarted late into 2022 causing shortages in factory parts and supplies. Biden focused on vaccination in 2020-2021. This inflation would have happened under Trump- this concentration of supply chain started with Reagan economic philosophy to ship production (and jobs) overseas, Clinton Bush Obama and Trump did little about it. Biden invested heavily in Make in America manufacturing and jobs at home. Biden and Powell did a good job of bringing this inflation down by 2023 to 3% before the European Union and UK. Younger voters don't know this they get their news from the internet and show little interest, see only that the low inflation under Trump and the higher inflation during the pandemic recovery under Biden and blame Biden. will Trump do better on inflation in 2024-2028. The WSJ does not think so its analysis shows inflation higher under Trump than Biden because of a planned 60% tax on imports from China. Trump follows Reagan/Friedman theory of the old Republican party of higher tax cuts for the wealthy, so no money is left for investing in American manufacturing and jobs as Biden free of this theory is able to do, leading to slowing growth with inflation under Trump.        ...

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This election is seen as a turning point for Britain. The Liberal-Conservative coalition has come up with a radical plan to cut spending and decentralize services in the areas of education, policing and health care. The plan is to cut the deficit quickly from 11% of GDP in 2009-10, to 2.1% in 2014-15. By comparison the outgoing Labor government's plan was to balance the budget by 2016-17. And the fiscal impact of Labor's budgets would have been 4% by 2014-15, compared to the Cameron government's looking at 6.3%, with larger and accelerated cuts in spending. It is something of a gamble by the Tory-Liberal government. If the severity of the cuts in spending stifle growth, then Plan B will be needed. The size of the cuts are not seen as feasible. With growing interest payments with the large borrowing by the government, and no real cuts in healthcare spending, departments delivering public services in Britain face cuts of 25% by 2014-15. With defense and schools limited to cuts of 10%- other departments would face cuts of 33%. According to the Institute of Fiscal Studies one way to reduce the severity of these cuts in department budgets, would be to find additional savings in the welfare budget. In June, Mr Osborne, the Chancellor of the Exchequer, announced 11 billion pounds in savings in this area (with half coming from using a different measure for inflation in calculating benefits). Additional savings of 14 billion pounds in welfare budgets, can reduce the size of the cuts needed in departmental budgets to 20%. One example cited is means-testing payments that go to the affluent as well as to poor people, such as child benefits, and cutting winter-fuel payments. Tories and Liberals agree on the need to decentralize government and services in the areas of schools, policing and the NHS. In schooling the idea is to give more choices to parents and children. Current schools can apply for academy status and new "free schools" will be run be non-profits, charities, churches, and parents. These schools will have freedom to set pay, select curriculum, and still receive state funding. In policing, the idea is to have directly elected police and crime commissioners for every constabulary in England and Wales. The elected commissioners would appoint constables and determine budgets and priorities. For the National Health Service the move is to give groups of general practitioners a significant role in the delivery of health care. ...

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Growth of 2.5% for the second quarter in S. Africa, and expected growth of 2% in 2013, down from 2.5% in 2012. High unemployment at 25% and a 23% depreciation of the Rand against the dollar in 2013. The current account deficit is at 5.8% putting pressure on the Rand which is at 10.45 to the dollar in August 2013. Labor unrest at mines which make up about half of exports is hurting the economy. This has spread to other sectors. About 100,000 airport technicians and construction workers were on strike in August 2013 for wage increases at twice the annual inflation rate of 6.3%. Strikes are also taking place at Ford's auo plant.