LyrArc Article Gist
People from academia meeting at Howard University's African American Economic Summit see a disturbing picture for improving the economic condition for black people in the U.S. Black unemployment at 13.8% is almost twice the rate for whites of 7%, according to government figures. Estimates of wealth disparity between whites and blacks of 20 to 1, declining black homeownership after the surge in foreclosures which hurt minorities badly, and lower savings after the 2008 financial crisis paint a bleak picture The outlook says participants is a bigger concern, not only have disparities widened, the future looks uncertain at best with further widening of the disparities a serious possibility.

LyrArc Article Gist
Tankersley points to the broken links between economic growth and growth in jobs and incomes since 1989, which have created a shrinking U.S. middle class. In the postwar period before 1989, a one percent increase in economic growth generated a six tenths of one percent increase in jobs growth during economic recoveries. During the 1992 recovery under George Bush this was down to 0.4%. In the 2001 recovery under George W. Bush this dropped to 0.2%, during the current recovery under Obama this is at 0.3%. Income growth also showed a similiar pattern. Median household incomes declined from 1990-1992 and from 2002-2004, after adjusting for inflation, even with economic growth of 6% during this period. For the 2009-2011 recovery period the economic growth was about 4% yet real median incomes increased barely at 0.5%. By contrast from 1982 to 1984 with economic growth of 11%, real median incomes went up by 5%. The result workers median wages are lower now in the beginning of 2013, after inflation adjustment, than at the end of 2003, and real household income lower in 2011 than in 1989, says Tankersley. Why were the recoveries of 1990 and 2001 for the most part jobless? U.S. Federal Reserve studies show employers mindset had changed, instead of hiring back laid off workers during recoveries, employers did not add many jobs. Automation in factories requiring fewer workers, global outsourcing and supply chains, manufacturing overseas, lack of union-management cooperation on wages and jobs in industries such as the auto industry, increase in temp workers, all played a part in creating fewer and fewer good paying jobs. Some of this is playing out worldwide. In Japan the economic recovery has also come with similiar costs- moving jobs overseas for the auto and electronics industries, increase in temporary worker jobs with lower pay and benefits to about one third of all jobs, and depressed consumer spending as a result lowering the economic growth potential. Even the recent German economic recovery has come with an increase in lower paying temporary jobs and driven by exports to Asia. For the U.S. the situation was worsened by three additional factors- housing foreclosures and the hit to savings from the 2008 financial crisis, high cost of college tution and resulting debt, and the high cost of medical care. The Obama administration's effort to increase the minimum wage would help the poor, but do little to address the broken links between economic growth and jobs growth/income growth. The push for college education does not address affordability and neglects jobs training. Most of the questions raised by the changing patterns remain unanswered, which may be why Obama calls this a generation's task, not that of one administration....

LyrArc Article Gist
U.S. President Obama's 2013 State of the Union address focussed on the problems facing the U.S. middle class, calling it "our generation's task" to tackle this problem. Economic changes have changed the patterns of economic growth and jobs, growth, income growth, that prevailed from the end of the Second World War to about 1989. But he offered few solutions beyond increasing the minimum wage to $9.00 from $7.25 to reduce poverty.

LyrArc Article Gist
A NYT report on Donald Trump's long standing relationship with his lawyer Roy Cohn,  who was also an advisor to Senator Joseph McCarthy. The report says Roy Cohn used aggressive legal tactics in lawsuits and influenced Trump's style of doing business in his real estate dealings. It is a detailed report of Roy Cohn's influence on Trump, which the reporters say has influenced the way  Trump ran his 2016 election campaign. It shows Cohn as protecting Trump in lawsuits, and Cohn's sense that Trump would someday play a big role in New York's real estate business, as Cohn's first meeting with Trump started when Trump was beginning his career in the early 70's. 

LyrArc Article Gist
The WSJ's Monica Langley provides insights into Donald Trump's campaign strategies, some of them right out of his book "The Art of the Deal." His target voter is from a think big strategy to get voters across a broad spectrum using the slogan "Make America Great Again," with a knack of tapping into a deep well of voter frustration with the political establishment. How to get attention in the media is the next step Trump tackled by using social media to the fullest - using Twitter often, making statements that attract attention such as the ones on China, Mexico, Senator McCain and Muslims that tap into failure of political correctness to address voter frustration on trade and jobs, immigration and terrorism. The Trump campaign has 14 million followers on Twitter, and 50 million "engagement" accounts on Facebook- that cost very little. Social media is to Trump in 2016 what community networking on the PC dashboard was to Obama in 2008. As the WSJ pointed out in an editorial, the splitting of the Republican vote among many candidates, and the failure of candidates to grasp the nature of the unconventional campaign waged by Trump- descending into attacks based on target groups of voters on every candidate except Trump- created the opportunity Trump has grasped with his knack for improvising along the way. Commonsense campaigning without sophisticated strategies, improvising often along the way, using the available medium of social media at little cost to get the message and slogan across, helped Trump make the deal with voters to upset the political establishment. The Sanders campaign is also based on careful repetition of the same slogan and facts about inequality and lobbyists, over and over again, offering strong action on health care and college tution just as Trump offers strong action on China trade, immigration with the idea of the wall, and barring entry of Muslims for terrorism till "we figure out what's happening." The difference being that Trump thinks big and targets the entire electorate of his party's voters in the primaries from the beginning, and a broad based campaign on many issues. Underestimating your opponent carries many risks in politics, never more so than when you are out of touch or not listening to voter frustration, and fail to speak up to it....

LyrArc Article Gist
David Barboza tells the story of Tan Guocheng in a continuation of exceptional journalism following workers like Yuan Yangdong on a production line at Foxconn and now Guocheng on a production line at Honda. Young migrant workers caught up in the first wave of urbanization in China and in the middle of sweeping change. Guocheng stops a production line and leads a strike at a Honda plant in China which is followed by Honda increasing wages by 32%.

LyrArc Article Gist
Over 50% of respondents in a Pew Research center survey conducted in December 2014 view with disapproval president Obama's handling of race relations, only 40% approve. This includes a steep drop among African-Americans of 16 points since the previous polling in summer 2014. Obama's statement that change is "hard and incremental" comes up short for many Americans who look for leadership in race relations. A cautious presidency fails to speak up for ideals it espoused, for human rights overseas and building a better future for minorities at home, losing precious opportunities at every turn.

LyrArc Article Gist
Christina Romer, Prof. of Economics at the University of California, Berkeley, was chairwoman of the Council of Economic Advisors under U.S. president Obama. Here she discusses the different aspects of the debate on raising the minimum wage. Romer says the negative effects on unemployment are small. The impact on consumer spending is also limited. The anti-poverty effects are real for raising the minimum wage from the current $7.25 an hour, says Romer, as over half the families earning a minimum wage make less than $40,000 an hour. President Obama called for raising the minimum wage to $9 an hour in 2013. Studies show 13 million U.S. workers earning less than $9 an hour. Raising the incomes of these families by about $3500 an year under the president's proposal gives workers badly needed income to cope with rising cost of gas, food and other basic necessities. The effects on consumer spending are small, estimated at between $10 to $20 billion. Its main virtue is keeping the principle of fairness and maintaining social cohesion at a time of increaing inequality. Romer says there is competition for workers which makes it possible for workers at the lower end to get a fair wage, but does not account for the effect of high unemployment which takes pressure off raising the minimum wage in the market economy. Another benefit for countries of keeping a fair minimum wage is that other actions can be taken to improve competitiveness for business and manufacturing and reducing the deficit and be seen in a positive context of overall improvement. This is part of the case made in Europe for boosting the mnimum wage as austerity measures are taking place....

LyrArc Article Gist
In a first at Davos World Economic Forum, China's president Xi Jinping uses the 2017 meeting to give a one hour long spirited defense of the world trading system, critical of U.S. president elect Trump's protectionist views without naming him. Xi pointed out that "no one will be winners in a trade war." And went on to add that restricting world trade was like "locking oneself in a dark room, keeping out wind and rain from outside but also light and air." For the first time Jinping stated that China would take the U.S. role of defending the world trading system from attack as needed. On climate change Xi defended the Paris accords, and gave China's commitment to pursue changes regardless of what the U.S. under president Trump does. This follows Chancellor Merkel of Germany's statements on the issue critical of the views of president elect Trump, and taking the lead to defend the world trading system. Xi also pointed out that many of the ills that led to voter discontent in the West were not really from the freeing up of trade but from the pursuit of excessive profit with the financial crisis of 2008.   ...

LyrArc Article Gist
William Booth provides a must read insight into why poorly educated young people attempt to cross the border into the U.S. looking for work and opportunity, and why Mexico fails to provide the elementary and high school educational system it needs to increase growth to create opportunity. Mexico's education system is failing when compared with other countries in the Group of 20. Sixth graders get 562 hours of instructional learning compared to 1,195 in S. Korea, according to Mexicans First, a group working to change the way the educational system works. In recent international exams half of Mexican 15 year old students scores ranked them at lower levels in math and only a little better in reading and reasoning. "De Panzazo" is a popular documentary prepared by Mexicanos Primero on the dire situation in the school system. One of the most striking measures of this failure is that only a quarter of the children graduate from high school. This only pushes more poorly educated people to attempt to cross the border into the U.S. looking for work. It means the Mexican economy is deprived of a highly educated workforce to increase productivity and growth. The middle class tries to get their children educated in private academies. And the nation's employers use special training to improve skills for workers to be able to compete in a global economy. Part of the reason rests, say experts, on the ability of the powerful teachers union with 1.4 million members to block change for teacher selection based on merits and competency, and exams for teachers. Instead teacher positions are sold, with an elementary school position tenured for life selling for $20,000 in Cancun, and a rural village position for $2000, according to Mexicanos Primeros. Even president Calderon owed his election to the support of the teachers union. And the current PAN presidential candidate Vazquez Mota, who was Education Secretary for two and half years could only go part of the way. She got the union to agree to have new teachers selected by having them take exams, made public standardized test scores, and pushed state governors to show employment rolls and whether teachers actually taught in classrooms or worked at union offices. Calderon failed to make changes because he agreed with the union that the union would take the lead on changes not the education ministry, and had the union president's son-in-law, Fernando Gonzalez, as deputy secretary of education. Jorge Castenada, a former foreign minister, says Mota was fired because of union demands. In July 250,000 teachers are required to take competency exams, but the union has asked its members to ignore the exams, and the education ministry will not do much beyond using the exam for diagnostic purposes for teachers who take the exam. The problems at the elementary and high school levels are evident also in other countries such as India and Brazil leaving the real potential of the labor force untapped....

LyrArc Article Gist
An assessment of Brazil compared to the other leading emergig market countries Russia, China and India, shows that Brazil has a lot going for it. Compared to Russia and China, Brazil has a stable multiparty democracy. And the differences between the countryside and the urban areas is not quite as large as it is in China and India. Surprising as it may appear about 83% of Brazilians now live in cities. And the process of urbanization that is taking place in China and India took place much earlier in Brazil. Between 1940 to 1980 industrialization and a growth rate that averaged 7% for most of that period brough large numbers of people from rural to urban areas. And the problem of inflation which wracked the economy from 1986 to 1994 before being brought under control is now well under control at about 4.7%. Debt problems from the Asian crisis contagion effects are now behind it as Brazil is a big exporter of commodities from coffee, soyabeans, orange juice to iron ore, with the real strengthening from 68 as measured in the currencies of its trading partners in 2001 to 100 today. Brazil's growth rate has reached 5.4%. and has been at an average of 4.5% since 2004. Between 1980 and 2000 Brazil's growth was in a slump so this has been a period of great changes in Brazil. Brazil is importing more plant and equipment with a stronger currency and booming exports. Brazil invests 19% of GDP according to Vale of MB Associados and that number should reach 25% of GDP at which point it would be easier to maintain a growth rate of 5% a year. With consumer credit growing at 25% each year for the last 2 years consumption is growing. And Brazilian companies were the second largest source of foreign direct investment in developing countries after China, according to the Fundacao Dom Cabral, a business school, and Columbia University, with the stronger real helping the balance sheets of Brazilian companies. The big change is that under the Lula government Brazil has done much better for the working classes and the rural poor. The Bolsa Familias is a program of cash transfers to poor people under the poverty line but which has strings attached so that they are required to send their children to school and have them vaccinated. It reaches 11 million families and is considered a major success in reducing poverty and in helping to see that poverty is not passed on from generation to generation. A program that may be copied in India. Acccording to the Observador Brasil/ Ipsos survey 23 million Brazilians have left social classes D and E and joined class C which means that they can have a rented apartment, a car and some gadgets. This give more confidence in Brazilian democracy and capitalism as more of society's diverse groups have a stake in the future....

LyrArc Article Gist
Juan Montes of the WSJ describes the problems facing states in Mexico as the governors have accumulated power, debt has risen rapidly, and accountability of state officials is at a new low. Half of the states with elections in 2016 have doubled their debt in 6 years, according to government data. The federal audit office points to irregularities in $13 billion of federal funds transferred to states. Elections in states in 2016 shows public discontent with poor governance, corruption, and the lack of rule of law. This is leading to a close election in Veracruz with the PAN and PRD parties challenging the PRI in the state.

LyrArc Article Gist
A Pew Research poll shows Democratic voters now favor a bold ambitious agenda by large margins. Voters seeking compromise swung sharply going downwards from 69% to 46%. Many are calling for Medicare for All. In the Republican Party the shift is slight from 46% to 44%.

In the House the Congressional Progressive Caucus now has about 90 members. Of the 50 newly elected members who are House Democrats 20 are part of this Caucus pushing for bold action.

LyrArc Article Gist
Columbia University Professor and Nobel Prize winner, Edmund Phelps, gives suggestions for reviving the economy. He sees structural problems in the economy and recommends more inclusion. Higher employment, he says, will require a higher level of investment activity, higher business investment and new technology and products. Inclusion will require more attention to jobs gained at all levels. He suggests a program similiar to Singapore's, with a program of tax credits for companies employing low-wage workers.

LyrArc Article Gist
Cost of living, of housing and healthcare, with the option of working remotely, is leading to more Americans leaving America for the first time since the 1930's than coming in. It is not just immigration policy discouraging immigration to the US. Middle class and younger Americans are seeing advantages in moving overseas if it costs much less for a better life and you can work remotely. In 2008 Gallup found 1 in 10 Americans wanted to leave, in 2026 1 in 5 want to leave for overseas locations.In 2025 more Americans left the US than came into the US. Estimates vary but one estimate is that in 2025 180,000 natural born Americans chose to leave the US. It is younger families, young people, from the southern US , from the midwest, all over the US, who are choosing to go to Europe or some other country to live and work. The State Department has no idea and does not keep track- it could be between 4 millon and 7 million Americans live overseas. Architects, engineers, professional people, are working out of small towns in teh French Pyrenees, or other parts of Europe.. Portugal - 365 increase inAmeicans in 2025. In a decade Americans living in Czech Republic, Nethelands, Spain, Germany has doubled. One couple profiled here moved to Portugal after preparing for 4 years. Portugal offers visas to stay if one can support himself, herself and family, which is the minimum wage or $27,000., which this couple could show as investment income. They could not find places to stay near good schools in LA because of the cost. Now in central Lisbon they can with $100,000 budget live a richer, fuller life, reduce hours of work, send kids to private school, no need for 2 cars as subways are nearby, and no need to put a ton of money aside every year for college. They have more time to themselves, more relaxed, and kids private school is close by. Today in the US setting aside a ton of money for college makes it difficult on $200,000 a year  in the managerial ranks as shown in reports in the WSJ. College can cost $100,000 a year for 4 years, 2 children $800,000, thats too much.  ...

LyrArc Article Gist
This leader in The Economist magazine says a hard Brexit of the sort announced by Theresa May at a Conservative Party conference is clearly bad for Britain. It also point out that half of British people voted to remain. It is not clear that voters have voted for a hard Brexit, a soft Brexit, or voter alienation with elites and effects of years of austerity since the financial crisis have helped tilt the vote to Brexit. It points out that the rhetoric may be damaging Britain's chance of negotiating a Brexit that limits damage to GDP, which the Treasury estimates to be nearly twice the loss in GDP if a member of a single market as compared to leaving it. British government leaders may be overestimating the willingness of leaders of France, Germany and other countries to make concessions. By talking up to their party base politicians such as May may be putting German and French leaders to also toughen their positions on free movement as an integral principle of the European Union, and consequently of membership in a single market. ...