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Boosting vaccine production for the Indo-Pacific region that includes Bangladesh, Indonesia, Malaysia, Thailand, Philippines, Vietnam with production done through Biological E in Hyderabad will be discussed at the meeting with Biden. Japan will fund the project, and Australia will handle the distribution. This will be part of a followup to a March 12 virtual meeting of Quad leaders. This effort to meet the vaccine supplies challenge for the Asian region covering south east Asia and its population of 600 million will be one of the major outcomes of Quad countries collaboration, making it a peacetime collaboration that supports development in the region without burdening the financial position of any country.  The other part of US- Indian collaboration and Quad collaboration centers on two related themes after healthcare and pandemic. The immediate challenge is to tackle the breakdown in the supply chain for semiconductors. The US and Europe can no longer depend entirely on a supply chain based in Taiwan. The narrowest part of the Taiwan Straits which separates Taiwan from the Chinese mainland is only 81 miles wide, which makes continued dependence on chip production on Taiwan an unreliable option and the need to build a new supply chain for Japan, EU and US. Plans will be made to address this in the talks. The Biden administration has already taken action with Intel Corp making a U turn and bringing chip manufacturing back home to the US with $50 billion investment planned. India and other Asian countries may form additional options for semiconductor manufacturing. The third part of the Quad effort will center on US and Japan ramping up infrastructure building capabilities with India to build infrastructure across Asian countries and in Africa that will be financed in a way that will not have some of the liabilities of the Chinese initiative called Belt and Road. Loans given by Chinese state banks and contracts including manpower from Chinese contractors are now seen as not meeting the needs of Asian and African countries. These loans most of the time cannot be repaid as in Zambia, and other parts of Africa, and in Pakistan, leading to interest accumulating on debt and making future infrastructure development extremely difficult. The use of manpower from China also means no learning curve for infrastructure is formed for local companies and infrastructure comes without new jobs jobs being created.  For most of the period 1900 -1950 the British built Asian and African infrastructure. During the period 1950 onwards the US assumed a major role, as did the Soviets. This changed after belligerent Reagan administration policies and wars in the Middle East sapped the funds that could have gone to infrastructure building that would improved living standards in Asia and Africa. Mr Biden wants to see this change and this is what he meant when he said at the UN General Assembly today- " we want relentless diplomacy to take the place of relentless wars." He means every word of this and the diplomacy is between allies and also adversaries, but mostly with allies such as Japan, the EU and India to build a better world. That he has to do this quickly Biden is aware of that, which is why he said "the next 10 years will determine our future."   ...

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Emmanuel Macron graduated from Sciences Po University in 2004 with a degree in public affairs. He joins the Finance Ministry as an inspector and then buys himself out of government service contract by 2008 to join a private bank. He arranges an acquisition from Nestle and other business deals during this period. In 2012 he is appointed as deputy secretary general for the president's office after Francois Hollande a socialist is elected to the presidency. In 2014 he is offered the position of Minister of Industry and Digital Affairs in the second Manuel Valls government. He makes some changes to French government but opposes the wealth tax or tax on business, and is generally pro-business, though he acts as a member of the Socialist party.  He uses this period to build momentum for his own run for the presidency as support for Hollande falters having lost support from his working class base with Macron and Valls inspired changes.  Macron finally announces he will run for the presidency forming his own En Marche movement which he finances with his own fund raising. Throughout this period right up to the election in 2017 Macron has not run for public office. When he wins the presidency in that year he lacks the experience needed as the youngest president in French history at the age of 39. Like another young president Obama he handles his public image with the media for his En Marche movement promising to unblock France. This public image and his lack of experience makes him impervious to the social changes going on in France that lead to the yellow vest protests in 2018. This is a period when there are changes in the midwest as workers in Michigan and other midwestern states turn away from Hillary Clinton and Obama.  French workers are in the position of workers in the US with the decline of manufacturing, much of it shifted with the supply chain to China and Japan, and the gap opening between rural and urban tech educated areas. Macron follows Obama's quick rise from Senator to run for president yet lacks experience, and lacks sufficient grasp of the social changes with loss of manufacturing, the wide gaps between rural and urban tech educated people, conditions in the rural and farming areas. Macron survives this period, is reelected in 2022 with the help of socialist Melenchon voters. He says he will govern differently, less distant from average Frenchmen, but his instincts are to push for pension reform. At a time of cost of living crisis, and when the French budget office says the change in pension from 62 to 64 was not critical at the present time when inflation was hitting the public after the pandemic. Macron does this by Article 49 in the way he has done under the Manuel Valls government, by executive action alone. This time he faces a no confidence motion in parliament in March 2023 following some of the largest protests France has seen in years, with two thirds of the French according to FR24 opposing the change in pension law. Women see this as coming at a time when age discrimination hurts their chances of earning a living after 50 years of age.  Age discrimination is widespread in France, in a way it is not in Germany, say reports in the NYT. And with the cost of living crisis acts as a major hurdle for the average French person, if pensions are delayed without addressing these cultural issues in France. The result is that the protests have substance and Macron is seen as not sensitive to this at a time when he lacks a majority in parliament. ...

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G-7 nations reach agreement for a global minimum tax of 15% a floor for taxes that the Biden administration finds acceptable. This agreement was reached at a meeting of the Treasury chiefs of the 7 G-7 countries in London on June 5, 2021. The G-7 countries are Canada, France, Germany, Italy, Japan, UK, and US. Next agreement from Russia, China, India and Brazil in the G-20 nations would establish new ground rules for the major economies. The G-20 meeting is in Venice July 9-10. The OECD is steering the international efforts to achieve that goal. For the agreement to be effective a number of small nations that use tax rates of below 15% to attract business have to be part of the new rules. One of these countries is Ireland with a tax rate of 12.5%. For the Biden administration in the US the goal is a significant one as president Biden seeks business to pay its fair share so that long neglected priorities for education, healthcare, infrastructure, post pandemic improvements can be met. France and other nations in the EU face similar needs in the post pandemic environment. By setting a floor the Biden administration is both creating a new cultural concept of fairness in taxation and making it possible to finance the $2 trillion spending programs for these priorities of president Biden. Behind this are important facts that have left the large tech businesses paying little or no tax depriving governments of the very revenues that are needed for infrastructure and services for a modern well run state. The Biden administration seeks to include the tech businesses as well as all businesses in the new tax rules so that a uniform idea of fair taxation applies across the whole economy for the first time in two decades. In this way it makes up for the missed opportunities in the OBC administrations of Obama, Bush, Clinton that have led to loss of faith in the state and institutions in the US. A similar situation prevails in the UK,  France and Germany where previous administrations failed to address this important issue of fair taxation and financing infrastructure and priorities in health, education, and critical needs of the people.   ...

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Pearlstein points to the need for the structural changes in the U.S., Europe and China to address the serious imbalances that are at the root of the problem. This process will be painful and mean a short term drag on the economy even if the right actions are taken. The process of unwinding the imbalances will take time. Lower growth in China will be good for the bubble in real estate markets and the reduction in the trade surplus, even though this will reduce imports of European and U.S. machinery. Higher savings in the U.S. and reduction of consumer debt will slow retail sales but this is healthy for longer term growth. The same is true for savings in deficit reduction that will result in more layoffs at the local level. The government needs to have similiar action take place at the banks to end their "extend and pretend" practices and finally write off bad loans in residential and commercial real estate. There is no easy way out, no solutions that can be made without a sharing of the pain. Policy makers around the world have tried to look for painless solutions for years and this may be the end of the road. There is some action that the governments and central banks can take. Pearlstein suggests that the European Central Bank buy up some of the sovereign bonds being dumped on the market even if it means printing money. The Fed, the Bank of Japan and the central bank of China can also swap some of the Treasuries they own for European sovereign bonds. This would give time for the EU leaders to give the European Financial Stability Facility the resources and powers to replace the sovereign bonds with more reliable European bonds. The Fed can take this opportunity to sell some of its huge pile of Treasury bills into the market so that it has more room for action in future years. The U.S. government can move up the spending for infrastructure in years 8, 9, and 10 to the next 2-3 years to give some support to the economy as these changes take place. The spending decisions should be left to an independent Infrastructure Bank. See the related article by Krauthammer in the Washington Post, August 5, 2011, which provides a companion policy prescription for U.S. deficit reduction based on the work done by the Bowles-Simpson Commission and by preserving efficiency and fairness....

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This self portrait by Vladimir Putin about his growing up years in Leningrad and the life of his father and mother during the siege of Leningrad by Germans may offer a better sense of the mind and thinking of the Russian president than the Dresden years when he was a junior Russian official in Communist East Germany (the GDR). It is an interview of the Russian president in 2000 by Nataliya Gevorkyan, Natalya Timakova, and Andrei Kolesnikov over twenty years back. Putin's father suffered severe injuries during the war in the fighting around Leningrad, twice being given up for dead and being dragged wounded across the frozen Neva river to a hospital by a neighbor. His mother was half dead from starvation and his father passed on his food given to him at the hospital. Having gone through the memories of this period affected Vladimir Putin's view of the world and no amount of US or German assurance about NATO's intentions may have erased these memories from childhood. The long period in power and the Covid isolation may have led to  perceptions that were less likely to change so that Putin did his own research and wrote a long paper on Ukraine in 2021 that reflected Russia and Ukraine's long history but did not reflect the changing national aspirations of Ukraine's people in 2022. This may have led to the miscalculation and the errors by both Putin and the leaders Merkel-Bush-Obama that the detailed WSJ report of 20 years of events show to have happened. The WSJ report of April 1, 2022, was titled "Vladimir Putin's 20 Year March to War in Ukraine and How the West Mishandled It." The Social Democrats in Germany under Schroeder and Steinmeier mishandled it by deepening economic integration with Russia as a way to make up for what had happened in the German invasion of Russia, and the Christian Democrats under Merkel with business interests never really grasped the different thinking of the Russian president relying solely on deep economic integration of the EU and Germany with Russia as well as China as an answer. Mr. Bush and Mr. Obama from a distance even less so.  This has led to the miscalculation by Russia under Putin leading to invasion of Ukraine, and the US and Germany being unprepared about taking action to prevent it.  Beyond the key participants and the war damage, there is the enormous damage that is taking place in the mental health around the world after Covid with constant barrage of images of war and refugees streaming into Poland. There is the problem of food imports, of food scarcity in the Middle East, and inflation in food prices for Africa and the Middle East. As Brendan Simms, a Cambridge historian has shown in his book "Europe The Struggle of Supremacy 1453 to the Present," which is now being read by German chancellor Scholz, this has happened before with the UK, Netherlands, Spain, Germany, Sweden, Denmark and Russia engaging in these conflicts that led to prolonged wars and eventually to only small shifts in power. Yet with huge effects for ordinary people caught in the wars such as today's refugees and people struggling to feed their families in Africa and Asia after the effects of Covid on income. Food prices have gone up by 50% to almost double in these countries.   ...

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Ike (President Eisenhower) quotes Eric Hoffer in his book "The True Believer", for a longshoreman's wisdom and insight. Writing to a veteran who asks Ike why the lack of certainty in his voice in 1959 as he nears the end of his second term. "Faith in a holy cause, is to a considerable extent a substitute for the lost faith in ourselves." Ike tells Biggs that, " in a democracy debate is the breath of life." That there is no universal degree of certainty, the confidence in in their understanding of our problems, the clear guidance from ahigher authority. This is important to keep in mind today as one looks at the way leaders from those in finance, industry and central banking and in government who acted as though there was this universal degree of certainty about the financial system and its workings, always to the good, and for the way in which the policies were handled in dealing with other countries. Its also true when one looks at the situation from other countries such as the period under Gandhi and Nehru in India, or Mao and Chou en Lai in China. There also what appeared to have universal certainty did not turn out thay way and policies had to be reversed and legacies examined. What Biggs wanted was "someone to speak for us and to back him completely if the statement was made in truth." And Ike's response was to say that dictatorial systems, and here one can include systems with figures who created their own sense of awe and hero image, make one contribution to their people that leads them to support such systems. And this was "the freedom from the necessity of informing themselves and making up their own minds concerning these tremendous complex and difficult questions."...

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Ms. Annegret Kramp-Krarrenbauer, elected leader of the CDU party in 2018 with the support of Angela Merkel, will not run for chancellor in next years election and will resign from her position by the end of the year. She will continue as Germany's defense minister. After losses for the CDU in recent elections and the embarrassment of local CDU leaders in Thuringia supporting the far right AfD, AKK as she is known decided to step down. Angela Merkel has decided not to run for chancellor again. Germany is set to chair the EU in the second half of 2020, and Merkel is no longer seen as a leader of influence. The Nationalist Alternative for Germany AfD has gained votes in recent elections following the 2015-2016 migrant crisis, with large numbers of refugees from North Africa and Arab world landing in Greece and Turkey and walking to Hungary, Austria and Germany. Merkel's handling of the crisis with acceptance of a million refugees in 2015-2016 unsettled European and German politics. Why? One way of looking at it is that in the same way that the U.S. took in Chinese imported goods ending in the Trump tariffs war, at some point it just becomes too big to handle. That ended up at $1 billion a day in imports from China when president Trump called it off and accused Obama Democrats, Bush Republicans, of betraying the country. Putting it into perspective Germany with one fourth of the population of the U.S. took in about twice the number of refugees in just one year 2015-2016 that the U.S. took in 10 years 2005-2015. The U.S. took in 675,000 immigrants between 2005-2015. This is as if the U.S. took in something like 20 million immigrants in a short period of 1 year on an equivalent basis- though the cultural impact is even greater in a nation like Germany that is like Japan an historically immigrant averse nation. All this happened too quickly for Germany to handle for its fragile cultural fabric. Much of the initial outpouring of support and positive sentiment came from the sense of having gone through World War II and the refugees in that and the early post war period, the need to return in the same spirit support Germany had received. Over time it eroded support for the Christian Democratic Union and Merkel. That Merkel could have done this is itself a small miracle. Now the rebuilding has to begin. Adenauer's CDU and the socialist SPD party of Willy Brandt now have less than 50% support, only with the Greens Party do they make up 50%. The question now is can the CDU, and the SPD which has fallen to 14% in elections, make it back and what kind of future makeup political parties will have in Germany, how the social fabric can be restored. AKK's achievement is to mend relations between the liberal Merkel wing of the CDU and conservatives from Bavaria (CSU) over immigration.  Candidates for CDU leadership are Armin Laschet, Jens Spahn, and Friedrich Merz. Laschet premier of North Rhine-Westphalia has Merkel's support. Looking back too much attention was taken up by the euro crisis, and too little was done in the areas of infrastructure, inequality gaps, education, child care, under Merkel's leadership and of the preceding SPD years, much like what happened under Bush and Obama administrations in the U.S. where wars, economic crises led to neglect on issues that affect lives of ordinary working families. ...

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The skepticism from US economists for Biden's efforts to boost US manufacturing coming from the same economists who thought it did not matter if US workers made the products that were used in the US. As if Made in USA did not matter. As if Made in India or Made in Germany did not matter. As if creating jobs at home or in other countries made no difference. At the same time as US or companies in India and Vietnam, other countries in Asia or European Union ramp up their efforts for shorter supply chains and manufacturing at home, they are working on building up the manufacturing knowhow and technologies that make manufacturing in the US, EU or India competitive with manufacturing in China. It is the lack of this manufacturing knowhow and experience that was neglected over two decades that has resulted in the situation faced today of long, unreliable  and in the end costly supply chains during the pandemic.

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The Venezuelan government provides gasoline to people in the country at a few cents a gallon- almost free. Even Saudi Arabia, the Emirates and Kuwait which have way better financial balances and dollar reserves do not provide gasoline at such prices. The result is chronic shortages of basic parts and other imports because the government does not have enough dollar reserves for imports. Venezuela devalued its currency by 32% recently, making imports more expensive and pushing inflation up even higher to 28%. The problems it creates are excessive and wasteful use of gasoline, and free gasoline that then provides consumers money to pay for surging cost of everyday imported products. Nullifying any real benefits when shortages, inflation, dilapidated infrastructure and lack of development and jobs, are taken into account. The lack of capital to invest in the oil industry has led to declining production making the situation unsustainable. Yet neither party of Maduro or Capriles in the upcoming April 14, 2013 election, following the death of Chavez, supports ending this subsidy. Efforts to end the subsidy by president Carlos Andres Perez in 1986 led to riots and about hundred deaths in police response, and a coup by Chavez, then a military officer, a few years later. Under Chavez the subsidy was extended to the level at which gasoline is about 4 cents a gallon. Compare this with the price in neighboring Colombia at $4.72 a gallon, and Brazil at $5.40 per gallon. Consumption per capita in Venezuela is excessively high, about seven times per capita than neighboring Columbia. The investment in infrastucture is hobbled by lack of capital, the capital Caracas dilapidated, and no major infrastructure projects taken up by the government. It costs Venezuela 8.6% of GDP or $27 billion to pay for the excessively high subsidy, compared to 3.2% of GDP going to healthcare spending and 5.1% for education. In comparison Indonesia, another developing country, uses 2.5% of GDP or 21 billion for its subsidy for a population of over 200 million. It is not that a fuel subsidy is provided, but the entitlement to free gasoline that makes Venezuela the lone exception. There is a reason why prices in Brazil and China, large developing countries, price gasoline to motorists at over $4 a gallon- to discourage excessive and wasteful use, and release scarce capital for infrastructure development, building dollar reserves for imports of machinery and equipment, and other uses in industrializing economies. Compare Venezuela with Bolivia under the socialist government of Evo Morales. In 2010 Bolivia increased its price of gasoline by 80%. The price in 2013 is about $2.00 per gallon. Morales cushioned the increase by increasing salaries in the health and education sectors, armed forces and police by 20%, and increasing prices of locally produced wheat, corn and rice by 10%. Morales said he did this to reduce state subsidies of $380 million for $660 million in gasoline imports, of which $150 million was siphoned off by smuggling gasoline to neigboring countries. Incentives were provided to oil companies to produce gasoline in Bolivia to reduce imports. ...

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The Trump administration's early proposal for NAFTA moves away from campaign pledges to completely renegotiate the treaty, instead taking the approach of working to improve the U.S. trade position in relation to Mexico and Canada. It includes seven objectives for tougher rules for labor and the environment favored by Democrats in Congress, and it also has support from Republicans with its effort to update NAFTA for changes in technology and in other areas since the accord was signed during the Clinton administration. The area in which U.S. and Mexican business are wary is one in which the Trump administration still seeks to keep the option of imposing protective tariffs, and a border-adjusted tax to level playing field for differences in taxes, as well as other measures to protect American jobs and interests. Because any renegotiated NAFTA also has to pass both houses of Congress this proposal took into account the different constituencies and interests for this issue. Robert Lighthizer, trade representative under president Reagan is likely to become the next U.S. Trade Representative and lead negotiator. We first profiled Lighthizer in a group in Lyrarc for pointing to the need for a level playing field in trade. As early as 2010 Lighthizer argued in op-ed articles that globalization and trade practices should ensure a level playing field for the U.S., and was covered in Lyrarc. ...

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The team of 5 engineers decided they would produce the first Vande Bharat train in 18 months- Project 18. The Indian Express talks to the team of original engineers who were on Project 18.  They are all part of Chennai Integral Coach Factory, setup with Swiss collaboration in 1955. By 2019 the first train was operational at speeds of 180 km per hour, semi-high speed and setting the transition to high speed trains developed entirely within India. Sudanshu Mani, General Manager of ICF, headed this effort and set the target of 18 months. He says China used to import all its trains and one day just decided to make its own- he asked himself the same question, why don't we make our own? Mani was in Berlin for 3 years on an earlier collaboration for train technology in the 1980's. By the 1990's this technology was 20 years old he says. That's how long it took to get anything done in those days, by the time it got started the technology would be obsolete. By 2018 just 2 years before retirement Sudanshu set up the Project 18 team convinced that this was the only way to get it done- to beat the odds. Devi Prasad Dash heads electrical engineering. Srinivas heads mechanical engineering. Pradhan is Chief Design Engineer. They did everything from scratch. There are 5000 others who worked on the project. Dash says it was like T20 cricket, just that they decided to do it in 18 overs. Ever wonder why the train is all white and with blue stripe? Subranshu who was chief mechanical engineer at the time says they tried other colors. Manish Pradhan says they decided on white after one thought that Indian trains are never white because we had that belief that anything white would get dirty faster. That is when we decided to make it all white and it will not look dirty, he says. Sudanshu Mani says he would close his eyes and he would see always the old Indian trains that one would see from the 1960's from Ahmedabad to Rameswaram, and onto Colombo after the ferry. At that time Colombo had Canadian coaches and locomotives under a Canadian aid plan from Talaimannar to Colombo which were like American trains, looked miles into the future.The same thing must have happened to Chinese engineers because Chinese premier Chou-en-lai visited the ICF in Chennai in the 1950's and wrote that Chinese engineers could learn about the new Swiss technologies from ICF Chennai. That is when the Swiss were building their own trains with European technology of that time. China and India, and Japan had no idea about the high speed trains that were in the future. This is how technology advances. This is how people build better lives and how the aspirations and hopes of younger generations become a reality. Somewhere in the dim light of the past there is a Chinese engineer with the undaunted courage, concentration and determination to "Just Do It," and before that a Japanese engineer, and before that a Swiss engineer designing a train for the Swiss Alps, a Canadian or American engineer designing newer trains for the Prairies all the way to British Columbia and California. All dreaming Big and executing Well, with the resources of each country there to aid them each step of the way. ...

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The yuan is up 5.5% since the peg to the dollar ended in 2010, reaching 6.469 to the dollar. But this is not helping the U.S. trade deficit. The U.S. Bureau of Labor Statistics shows the price of imports from China are up 2.8% in May over the same month prior year. And the trade surplus for China in the first four months of 2011 is higher than the same period in 2010. What is happening? The improvements in productivity of Chinese manufacturers and the acceptance of lower margins is reducing the effects on trade balance of a small appreciation of the yuan, so that only a fraction of that appreciation is showing up in higher prices for Chinese goods. Also significant is that the yuan's small appreciation against the dollar is not enough to make up for the dollar's fall against other currencies. The yuan is down 8.3% against the euro and has actually declined 3.7% on a trade weighted basis in the last year.

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This response by experts on transatlantic relations rejects the other view expressed in Zeit Online that the U.S. under Trump remains estranged from Germany and the EU. These experts from the American Institute for German Contemporary Studies, American German Council, and Centers at John Hopkins and Georgetown for German Studies, reject the view that the Trump administration and Germany are that far apart on many issues as it appears from media coverage.  Foremost it points out that civil society relations are sound and growing. About 50 million Americans trace their descent to Germany, including president Trump, much larger to over half the U.S. population considering European descent. Much larger is the sense of a culturally shared future with the European Union, with the nations of Europe including Germany, France, Italy, Spain, the nations of Eastern Europe, and Britain. The civil society relationships run deep in a way that is hardly affected by the Trump administration. Within the Trump administration the policies to Europe these experts remind the reader, are determined by the "adults" in the administration, who are senior members of the administration. This is a crucial point as Trump administration policy is not determined by the president's liking for tweets as much as by senior cabinet members Tillerson at the State Department, Gen. Mattis at Defense, Kelly at the White House, and senior members of Congress including Senators Corker and other senior committee members. This is why Republican Senator Kay Hutchinson was chosen as Ambassador to NATO. It should be noted in this context of German-EU relations in president Trump's first year that there was a period of German disillusionment with president Obama, exacerbated by the NSA spying on German chancellor Merkel and on the EU delegation to the UN, with president Obama's failure to offer any apology. Relations recovered from that low point. No one suggested that there be a German led decoupling of the EU with America at that low point, or at another low point in German-U.S. relations with the setup of American Pershing II nuclear missiles on German soil under the Reagan administration when there were large scale protests.  The American view that the U.S. should not have to shoulder major responsibilities for defense and foreign relations by itself is not new say these experts, and goes back to earlier administrations before Trump.  The experts argue for an active role by Germany with its partners in Europe for defense and foreign relations, which should not be seen as a result of U.S. pressure, only responding to the situation as it has evolved upto this time. Views on immigration are also changing with effort by the EU and Germany, France, to reduce immigration from the source countries in Africa, and the changing perceptions about uncontrolled immigration in Germany and France, say the authors. A coordinated policy towards Russia  is seen as not having changed. And much as a reset in relations was advocated by Obama in the first year of his first term, the current policy of the Trump administration to work with Russia to lower tensions can be seen in the same way say these experts, and not as a fundamental shift in American policy. The deep relationship of Germany and the EU with China is another positive aspect that will also help the U.S. in framing its own policies towards China. The German-American relationship, and the European Union relationship with the U.S.  is seen as basic to the values and interests of the U.S. and Europe. This relationship is too deep and supported by civil society and Congress, the Republican Party, and the Democratic Party, by large trade relationships, to be affected by temporary differences under any one administration. Even these differences are part of a larger debate that is part of dialogue on issues in a democratic society, sometimes raucous and loud, and could be welcomed and carefully channelled in constructive ways.     ...

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Easwar Prasad, Cornell University economist, and a former head of the IMF's China division, says the new report by the World Bank and the Development Reform Commission (DRC), is part of an effort by government officials in China to push the agenda for change forward during the transition to a new leadership. This includes Premier Wen. There is pushback from large state enterprises. The DRC and the World Bank had called for a change from the current situation to allow more private sector involvement in the economy, which means restricting the growth of the large state owned companies and letting the private sector operate in more parts of the economy. The alternative is to see growth slowing quickly and -some economists- say suddenly without warning. The role of Zhu Rongji, a former prime minister during the period Jiang Zemin was president, in pushing for changes appropriate to the period, is also cited. The last decade under prime minister Wen Biao is seen as one in which China relentlessly pursued its currrent export led model of development with large state run companies and state run banks dominating the economy. This has made change even harder to achieve because of the pushback to preserve the status quo....

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A number of issues came up at the Women20 Summit in Berlin. Annette Niederfranke, Director of the International Labor Organization, brought up the issue of family reconciliation as "one of the toughest challenges for working women worldwide," that in order to meet obligations women tended to work in "non standard forms of employment and in part time work linked to lower wages, lower social security, lower benefits, and fewer training possibilities." Childcare was also an issue that was prominent considering the lack of adequate childcare in many countries including in the European Union. With responsibilities for the elderly, babies, and small children women tend to be in the workforce for shorter periods leading to men taking up many of the higher positions. Angela Merkel pointed out that Gemany tended to take a narrow view of professions available to girls, saying- "So it is very very important that we take a broader view of things while girls are still at school." Merkel also supports a Africa compact that would help women set up small and middle size businesses in poor countries. The "Digital" aspects of this and other efforts for women were a major topic being discussed. One idea that came up was that more cooperation from men was needed to make things happen. This is the third Women20 Summit after ones in Turkey and China, and a sense of momentum was felt by women. ...

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The last days of the pro-Russian Donetsk People's Republic in eastern Ukraine, as Ukrainian government forces under the government of prime minister Poroshenko defeat separatists by July 2014. Russia decides not to intervene further. Opinion polls show a majority of Ukrainians in Donetsk do not favor separatism, and opposition is based on alienation from the poor quality of governance in Kiev. With the Poroshenko government committed to respecting the rights of Russian speaking Ukrainians, Tymoshenko soundly defeated in elections, and Russia's economy at risk in the adverse impact on foreign investor sentiment, Russia's sees little to be gained from supporting the separatists.

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Friedman says Putin acted emotionally by letting impulsive reaction to the anti-Russian feelings in western Ukraine determine Russian policy following the collapse of the Yakunovych government. The months long Russian response in Crimea and eastern Ukraine may have secured Russian pride at a large cost. This includes the damage to the relationship with Germany, seting the EU on a path to look for other sources of energy to reduce dependence on Russian gas, a natural gas deal with China in which the price was kept "a secret" and may have provided China with a bargaining edge considering the timing of the negotiations. The most severe impact is in the loss of confidence within Russia, reminding the Putin administration that though the economy has grown in the Putin years it is still fragile and connected to the global economy. The capital outflows of the magnitude of $160 billion at a time of high inflation and sharply slowing growth actually put at risk the gains Putin and Russia made in the last decade, and risk the future agenda to improve the standard of living of the Russian people eyond the major cities. Putin's own assessment would eventually be closer to that of Alexei Kudrin. Kudrin, finance minister in Putin's previous term, correctly saw the dangers of impulsive policy concentrated in one figure, and the suppression of other voices including the opposition needed for Russia to be governed in a manner similiar to western Europe, to attain a similiar level of economic progress and standards of living. In today's global economy even the U.S., France, UK and states inside Germany need foreign investment for jobs, new ideas and technology, and the opinion expressed on media television and internet shapes investor sentiment to a larger degree than fully understood....

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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....

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German perceptions of Mikhail Gorbachev are shown here in DW.com. He is revered in Germany because of Gorbachev's efforts to end Soviet rule in East German state called the GDR, leading to the fall of the Berlin Wall. Gorbachev supported German reunification but did not do this is in a way that ensured that ordinary Russians and citizens of the GDR could make the transition to democratic processes in a smooth way. He also failed to grasp that economic transition could be difficult and would require extensive aid and grants from the west, and that safeguards and protections for retired pensioners and vulnerable sections of society needed to be in place. The following is a reflection of the background in political government and economy of the events in Europe leading to the war in Ukraine.  As a result Gorbachev's instincts were right by first 1956 as a student, and then 1979 as government official about the need for democratic processes to realize the real potential of Russia, just as has happened in many countries that lacked these processes for change in government- Japan, Germany, South Korea, India, Brazil and many countries in Asia and Latin America. But not realizing that these countries made the transition with considerable American and British assistance. Even where there was no direct assistance indirectly the British setup the first limited Swaraj or free rule in India, with elections and elected assemblies in Indian states in the 1930's, following the pattern in Dominion states Australia and Canada. Mohandas Gandhi negotiated within these processes for rights of South African Indians and Colored people, gaining experience, including study of British law.  A son of poor farmers in the agricultural region of North Caucasus, in Stavropol, it is relevant today that his maternal grand parents were from Chernihiv in Ukraine. He came to power in 1980 after entering the Politburo that year. These were the waning years of Leonid Brezhnev, president of the Soviet Union who followed Nikita Khrushchev (1953- 1964). Khrushchev was from eastern Ukrainian region near Donetsk. Leonid Brezhnev was a protege of Krushchev since 1931, from Kamianske, Ukraine.   Gorbachev was influenced by Khrushchev's speech that denounced Stalin in 1956 in favor of a freer and more open society. Khrushchev, became first secretary of the Communist party in 1953 after the death of Stalin and set the pace of post war Soviet society from 1950 to 1964. He removed the fear of the dictatorship of the proleteriat working class, increasingly dictatorial under Lenin, and blatantly arbitrary under his successor to make Soviet Union a freer society.  Yet his tendency to make decisions on his own without consulting others, and the failure of agriculture in the Soviet Union including food shortages led to his replacement by his protege Brezhnev. Brezhnev's whole career was built under Krushchev in Ukraine, in the army in Ukraine, and as a political leader in the Soviet 18th Army that entered Prague in 1945 defeating the Nazis. Why is this relevant? Gorbachev was educated at Moscow State University when the Soviet Union was in the Sputnik era, and felt at the time that it could reach the 1950's standard of living in the US- very different from the earlier leaders. Yet he may have been too much of an optimist and not hands on in understanding the working of a modern economy as large as Russia and the interests of different groups of society that had to be be balanced and protected. His understanding of the US and of how the US and British economies had evolved was limited or nonexistent. The isolation of the Soviet period may have compounded this. The Russian state in the Soviet Union could not simply unwind the power of the state and its intervention and everything would come out right of its own accord.   Leonid Brezhnev, the Ukrainian Russian who succeeded Krushchev from 1964 to 1979 let the system of Soviet rule remain as it was, in the Great Stagnation, leading to lethargy, lack of innovation, and a weak economy with military expansion. Gorbachev tried to regenerate the system by opening it up, but failed to see that there was a risk that it could come apart quickly as it did in just 4 years after he became president in 1985. Only the centralized power of the state had kept the Russian state together from the Tsarist period through the Communist period. The risks of this Gorbachev failed to grasp. What if it happened too quickly without a safety net for the people who could not make the transition. What lawlessness and failure of the rule of law could happen. The US and Britain had evolved their democracies over centuries. Wars were fought in the US and Britain over rights and responsibilities of kings and parliaments. In the US Lincoln fought the civil war not just for emancipation but to ensure safeguards for free white men on the farms so that Labor did not get disabilities placed on them by Capital (entrenched forces of Capital of which the southern plantation economy was only one aspect.)  Japan and Germany were set up as democratic states through American power and constitutional frameworks with Marshall Plans or agreement to take in unlimited imports from Japan. This bad scenario happened in Russia because Gorbachev failed to set the conditions first and work patiently to achieve them including introducing limited  elections and parliamentary processes first in Russia.  Leaders such as Yeltsin who succeeded Gorbachev in 1989, winning the elections that followed, failed to provide a safety net for the vulnerable in the 1980's. Unemployment increased rapidly, life expectancy dropped in Russia, and the economy failed in the early years after 1980. A Marshall Plan like that offered to Germany could have helped but Gorbachev's failure may have been his failure to provide this transition by arranging for West Germany and the US to support a planned transition, a kind of Marshall Plan of Aid, and maintaining a gradual move to democracy as the country was given time to learn institutions of American and British parliamentary democracy. No such Marshall Plan was negotiated for a smooth transition over inevitable obstacles, no safeguards were put in place for illegal efforts to control the state by rogue elements and to seize assets of state companies, no efforts to first introduce limited elections and parliamentary processes for learning democratic process in Russia, and the people of Russia were left with a memory of the this period as a bad lawless period from 1989 to 2005.  Leading to the situation today under Putin of aspiring to the Soviet period as a kind of period that had offered Russia the world recognition it had lost. And this had happened even though the Russian economy had recovered and the standard of living had risen under Putin. Putin's career spanned the period as a Russian official in Dresden, Germany Democratic Republic or Soviet period East Germany to working in the St Petersburg City Council under Yeltsin. He personally witnessed the fall of the Berlin Wall and the fall of the German Democratic Republic from Dresden and Gorbachev's refusal to build a transition period for the changes so that it would not be traumatic for the GDR. Even after reunification these traumas remain in some segments of the older population in East Germany that saw themselves as neglected and support extreme right wing parties in eastern German states by 2020- considering the Soviet period as one in which their lives were less neglected.  After three terms as president Putin with his own traumas from that period in Dresden, and with a mother lost in the period after the Nazi invasion of Russia, a father who survived the Battle of Stalingrad, saw the period of lawless behaviour in the collapse of the Soviet Union as the"greatest geopolitical disaster of the century."  Putin and people around him made missteps and miscalculations launching a war in Ukraine, leading to the situation today- jeopardizing hard won gains for the Russian economy. By 2022 Russian standards of living had risen and the economy was in the best shape it had been in the modern period since the Industrial Revolution. Yet largely exposed because of the dependence on oil and gas during a period of climate change and focus on building future economies free of fossil fuels.  Putin in his own peculiar logic may have seen this as the only opportunity in 2022 before deliinking from fossil fuel reduced the importance of the Russian fuel dependent economy to make some territorial readjusments in Ukraine with a quick war taking Kviv. That turned into a massive miscalculation with the emergence of nationalist fervor in western Ukraine spreading to the whole country of 40 million people. In the future to 2030 with phasing out of the fossil fuel economy, Russia without the connections to the US and European Union's technology and resources it had during Putin's three terms, and facing strict sanctions from US and EU, faces a difficult future. This has cautionary lessons for all countries- the US that read too much into the fall of the Berlin wall and indulged in a losing proposition with free markets that damaged its infrastructure and manufacturing with shifts to China, China understanding of how it to was dependent on the world economy for its future development, India that had to navigate a difficult period and what lessons to draw for building a bigger economy, the EU realizing the failure of its policies of depending on Russia for energy and China for manufacturing with fragile supply chains,  and Russia that there were twists and turns and the need for safeguards and experience building democratic processes before these processes would work for the economy, its people and for Russia as a nation. ...

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This Wall Street Journal editorial calls for more transparency in disclosing bad debt problems at Spanish and other European banks. It faults recent and upcoming stress tests of EU banks for not being stringent enough and taking into account adverse scenarios. While Spain's central bank says only 20 billion euros are needed to recapitalize the cajas savings banks, other estimates are much higher. Moody's country report says Spain could need upto 120 billion euros to recapitalize its banks. A big problem is European banks exposure in Spain which is over 700 billion euros as of September 2010- Spanish banks have high exposure in Portugal and German banks have high exposure to Spain.

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This WSJ editorial says despite his call for "hard-hitting sanctions" prime minister Cameron of Britain has not taken action to stop the flow of "dirty money" from Russia into the City of London. About $75 billion left Russia so far in 2014 in capital flight as the Russian elite shifts money overseas including to the City of London. France has a planned $1.6 billion sale of Mistral naval ships to Russia, and will need the British example to cancel this sale. Putin's strategy is to distance Europe from the U.S. In the EU countries opposing tougher sanctions are Germany, Netherlands, Italy and Greece. Netherlands suffered the most with 193 Dutch citizens killed in the shooting down of Malaysian Airlines Flight 17 over eastern Ukraine.