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Finnish president Niinisto provides a new understanding of Mr. Putin and the thinking that led to the invasion of Ukraine. Mr. Niinisto has an advantage having spoken with Mr. Putin countless times says this report in WSJ, and spoke again to Mr. Putin on May 14 to tell him that Finland was planning to join NATO. Putin simply responded that Russia does not pose a threat and "you made a mistake." He says it was not the Finnish way to not call Putin and tell him directly, and that not doing so would be like sneaking away around the corner. Mr. Niinisto says WSJ, has a rare insight into the thinking that led to the behavior of Mr. Putin in launching the war. Here are some insights from this report by Adam O'Neal of WSJ. On the situation in Ukraine Niinisto says " I would be a lot more worried about Ukrainians than about how Russians feel." Mr. Putin's willingness to see Ukraine's industrial centers, its infrastructure and cities destroyed, turning them into moon craters in the east compares with the relative ease of life in Moscow, St Petersburg and other cities, cushioned by Russian oil and gas exports and financial reserves. As a student of Finland's long and violent history with Russia Mr. Niinisto has some unique insights into Russian thinking. He tells WSJ's Adam O'Neal  that if a Russian is angry, yes, be careful, but if he's calm, be even more careful. The Russian invasion of Finland led to loss of 200,000 lives in 1939-40, and another 250,000 Russian lives in fighting between 1941-1944. Finland has 300,000 men or women in military reserves and men between 18 years and 60 years are called up for military service with the Finnish Constitution requiring every citizen to contribute to national defense. Recently Finland ordered 64 F-35 fighter jets from the US. What led to the invasion of Ukraine by Mr. Putin? Niinisto says that "somehow Mr. Putin has a feeling that Russia was betrayed in the 90's by the West. Over time this thinking continued feeding the negativity says Niinisto and led to the thinking that Russia could be betrayed once more.  Another aspect of Mr. Putin which was covered during the last decade of relations with Ukraine in Lyrarc, was his perception that Ukraine under various leaders before Zelensky was basically led by corrupt leaders including one president he supported but lost power in the last decade. Mr. Putin saw protests in Kviv and Lviv that ousted a president he supported recently as orchestrated from outside. This led to thinking that Ukrainian nationalism did not exist and he believed that Kviv would not be defended and would fall easily within a week or weeks. As his nationalist perceptions and that of a small group that included his partner in office Mr. Medvedev became stronger in the last ten years Mr. Putin made the decision to take the option for invasion in the thinking that the response of the US and Germany would not be to support Ukraine with arms and other aid. The CDU and SPD was perceived as weak in Germany and Scholz not seen as able to cut down oil and gas imports to the EU. Biden was seen as not willing to stop Russia by taking on a difficult conflict because of China allying itself with Russia, considering China's interconnections with the American economy. The timing was seen as good considering that this level of dependence on oil and gas imports of Europe on Russia would never be the case after planned shifts to renewable energy. The Russian economy was cushioned by its $620 billion in reserves and by the world's need for energy even as the shift to renewable was taking place. This window my have induced Mr. Putin to take what appeared to be a rational decision that ignored the common feelings of humanity of risking the destruction of a brotherly people that spoke Russian, prayed in Orthodox churches, and where Russia as a state started in the year 1000. Cambridge historian Brendan Simms in his new book "Europe : The Struggle for Supremacy 1453 to the present," has shown all European powers susceptible of reasoning and calculation of this type in their wars since 1453 in the struggle for supremacy in Europe up to the present- the Portuguese, the Spanish, the Dutch, the British, the French, the Germans, the Russians, the Danes, the Swedes. This also led to British and French empires in Asia and Africa with subjugation of Asian and African people. The Second World War had created the perception that somehow this had changed after the loss of millions of lives- that was the perception of Merkel a pastor's daughter who had grown up in the former communist state of GDR in East Germany, and of SPD leader Steinmeier who felt strongly about the loss of lives from the Nazi invasion. Merkel and Steinmeier built the relationship of Germany with Russia that has collapsed under Germany's new leader Scholz and Habeck-Baerbock of the Greens party. Merkel and Steinmeier also built the trade relationship with China that also faces collapse with China's support of Russia under Mr. Jinping, and the unexpected shifts in Chinese leadership and policies from that pursued by premier Deng and his successors in 1990-2010 of interconnected economic links with US and EU. Mr. Scholz, the new chancellor of Germany has Brendan Simms book on Europe on his reading list for 2022 as he ponders over the lessons of 2022 and the pandemic. Mr. Biden with long experience in the Senate of the US has a memory and understanding of what happened since World War II, how America got to this point, and what it will have to do to bring back the American spirit to the Free World that America has led for most of the last two hundred years. ...

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Yuka Hayashi gives an exceptional account of the rise of nationalism in Japan. This is especially true of the younger generation. As examples of the changing mood, he gives the popularity of Will magazine with circulation of 100,000 among younger readers, including large numbers of women. Other examples are the movie "Eternal Zero" remaining on the top of box office charts for 2 months, neto uyo or right wingers on the internet are popular, and bookstores display titles responding to China and S. Korea's criticism of Japan. Fringe candidates such as Toshio Tamogami have won 24% of the vote in Tokyo's gubernatorial race, with large proportion of younger voters. The younger generation is not accepting quietly the criticism of Japan's prewar record in the same way as the older generation with memories of the war. It sees itself free to respond to what it sees as China and S. Korea's constant criticism of Japan, even when Japan has apologized repeatedly for its aggressor role in Asia. Weekly magazines such as Bunshun and Shincho carry Japanese criticism of China and S. Korea with sensational headlines about lies. Abe's recent visit to the Yasukuni war shrine- the main object of S. Korean and Chinese criticism and America's concern expressed to Japan- is shown in an Asahi Shimbun poll recently to get favorable support from 60% of people in their 30's. Many of the 119 freshmen members of the Liberal Democratic Party of Mr. Abe also provide support, and some even see Japan needing to defend itself with or without the U.S. Is this level of nationalist sentiment similiar to the twenties and thirties, or to periods of tension in the 1990's and other post war periods? Only recently in 2010 the Democratic Party of Japan under a young prime minister Hatoyama and premier Naoto Kan, a civil rights activist, presented another side of Japan seeking closer ties with China- even distancing itself somewhat from the U.S. on the issue of bases in Okinawa. Naoto Kan also enjoyed a 60% level of popularity as premier Abe has in 2014. Which is the real Japan, or is it a reflection of fatigue among younger Japanese with always having to say you are sorry, as has happened to the younger generation in Germany. Hatoyama resembled Obama as a younger politician bringing a new optimism in Japan after years of LDP rule. Unfortunately president Obama distanced himself from Hatoyama on the base issue and failed to support Hatoyama at a time of tensions with N. Korea, leading to his fall in ratings and resignation. This may turn out to be a lost opportunity for the U.S. for building peaceful neighborly relations in Asia. In 2007 Chinese premier Wen Biao a speech to the Japanese parliament, the Diet, saying: "With history as a mirror it does not lead to long-lasting hate, it points to a better future." Japan's premier at the time? Shinzo Abe. What has changed? China's economy has doubled in size, and so have global Japanese corporations such as Toyota with advanced technologies, economic insecurity is unfounded in a globally linked interdependent economic system. ...

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An exceptional editorial on the steps taken since bankruptcy for reviving Detroit -with all the numbers one needs to know for how this was done and is progressing. The editorial gives credit to Michigan Governor Snyder and Emergency Manager Kevyn Orr for having the courage to guide Detroit through the bankruptcy. It sees the outcome emerging, including treatment of bondholders, pension funds, and city workers, as fair considering the problems involved. The steps are also being taken to correct the deep seated problems that caused the crisis.

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A review of the Volcker Rule for bank regulation in its final form by the WSJ in Dec. 2013 shows it leaves out language permitting portfolio hedging. Banks will not be allowed to use portfolio hedging creating new risks. Regulators wrote in the rule that hedges are not to "give rise .. to any significant new or additional risk that is not itself hedged contemporaneously." The Volcker Rule in its final form was influenced by regulators awareness of the J.P. Morgan Chase bank's huge losses from portfolio hedging in the Whale case. Senators Merkley and Levin in the U.S. Congress wrote to regulators saying a loophole in the Volcker Rule allowing portfolio hedging would lead to a repeat of the "London Whale."

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The National Assessment of Educational Progess (NAEP) test scores in the U.S. for K-12 show a lack of progress since 2013. Scores for math and reading dropped for 8th grade students, and scores for reading were stagnant while dropping in math for 4th grade students. The test scores reflect progress in rural, suburban, urban environments, for communities that are affluent, less affluent and poor, different ethnic backgrounds. The test started in 1990 is the only one measuring national progress. The new results of NAEP are on a scale of 0 to 500, and show that in 2015 64 percent of 4th graders and 66 percent of eighth graders were not reading proficient, 60 percent of 4th graders and 67 percent of 8th graders were not math proficient. Massachusetts, Vermont, New Hampshire, do much better in the tests than Mississippi and New Mexico. Experts say a state to state comparison should separate the non native English speaking students from native English speaking, especially in states like Texas. With about two thirds of students failing the math and reading proficiency levels, growing proportions of minority Hispanic students in many states, larger proportion of less affluent students, the tests show the challenges facing America's K-12 education even after the changes introduced by Education Secretary Duncan since 2008....

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Former prime minister Nawaz Sharif faces a trial on corruption charges in Pakistan in 2018, just prior to new elections. The military and the judiciary both support the trial which involves payments for 4 upscale neighborhood London apartments owned by Sharif. 

Mr. Sharif's party leads in polls with about 36% support, higher than the next leading party Tehreek which has 24% support and is led by Imran Khan a former cricketer. The Pakistan People's Party of the Bhutto family comes in third. The result of this could be a weaker coalition government. The Supreme Court has banned Sharif for life from holding political office. Pakistan has seen governments toppled and military rule for half of its 70 years since independence. The rivalry with India and the role of the military has affected political institutions and democracy in Pakistan making peace with India difficult to achieve for any elected government.

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Matt Vela responded to Shailen's comments on this article on the BW site. Comments were on NYTimes columnist Tom Friedman's remarks, about the dangers of overdependence on Mideast oil vs. GM and Ford's efforts to simply move cars off the lot. A quick reading of reader comments about 5-6 (all comments) shows a huge perception and marketing gap for Ford and GM if this is even anywhere near a representative sample, because they were heavily negative. Friedman said in the NYT, that "GM is more dangerous to America's future" than any other company, that "its like a crack dealer" addicting Americans to SUVs in the face of higher gas prices- by offering buyers of its least fuel efficient SUV's gas capped at $1.99 per gallon. He also said GM is in cabal with Ford and DaimlerChrysler to buy votes in Congress. BY May 2006 compared to 2003, in just 3 years, once popular midsize SUV's like the Ford Explorer, Chevy Trailblazer, and Dodge Durango saw a sales plunge of 50%. And this after the gas promotions such as the Ford one for free gas upto $1000 with aprepaid Master Charge debit card, enough for 6000 miles. Add to this zero percent financing. GM offered rebates of $2500 to $3500 per SUV. In this manner the whole profit structure of SUV's is being lowered, and no new strategy is being developed to deal with changing conditions and changing consumer preferences, and a changing global situation....

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Jimmy Lai is one of the prominent Hong Kong businessmen who have actively spoken up for universal suffrage without screening of candidates by the government, instead of sitting by on the sidelines. He says he is not talking to the student leaders, and it is upto the young generation to take the initiative as it is about their future. At age 12 Lai was smuggled into Hong Kong by parents in Guangdong province in 1960, making him one of the older generation who has lived through the many changes in Hong Kong- from the British period, through the years of turmoil on the mainland in the seventies, the transition period and transfer to China under the Basic Law. He worked in factories instead of going to school, and later started his own clothing chain Giordano, followed by a move into media publishing. He is the publisher of the Apple daily and Next magazine publications which support the pro-democracy student movement. Lai says the roots of student protest are in the May Fourth Movement of 1919, a cherished part of Chinese history because it led to the awakening of China, sparked the interest in breaking away from the past leading to modernization, lasting for 2 decades till the Japanese invasion and Communist control. Lai says the protest movement is more mature than the movement in China at Tiananmen in June 1989. Another factor that makes this different is that the protest in Hong Kong does not chart out an indefinite future for China just when it is embarking on the path to modernization, the situation facing a cautious Deng in 1989 who experienced the chaos of the sixties and seventies. The movement in Hong Kong is about reinstating what is felt to be in the spirit of the Basic Law- universal suffrage in its true spirit and intent without prescreening candidates for 2017- it is a limited objective and does not risk the modernization drive, more likely to enhance it by keeping dialogue with the outside world open as China looks for new ideas to tackle many prblems left behind from the industrialization period of 1990-2014. ...

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Retired General James Mattis headed Central Command under the Obama administration. He is the new U.S. Defense Secretary. Mattis is critical but has said "there is no going back" on the Iran nuclear agreement. Mattis also has said any U.S. president regarding allies as "freeloaders" is nuts. This is different from Trump's campaign speeches, Yet the trait of Mattis in Afghanistan and Iraq duty is that of aggressively following the enemy, he has been called "Mad Dog,"  and the 66 year old officer brings deep battlefield experience, is highly regarded in the military ranks, and had friction with the Obama administration- traits for which he is well regarded by Trump.

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About 11% of student loans outstanding amount were over 90 days past due in Sept. 2012, increasing from 8.9% at the end of the second quarter 2012, according to the Federal Reserve Bank of New York. This now exceeds the figure for credit cards. U.S. student loan debt is now at $956 billion for the third quarter 2012, increasing by 4.6%. About 93% of student loans made in 2011 were made by the U.S. government, which is promoting access to loans without asking for information about borrowers finances and education plans and ability to pay the loans back. Because student loans have to be paid back and are hard to discharge even in bankruptcy, this means many borowers who cannot find jobs are deep in debt, and unlikely to get loans for many years for cars and other needs. Moody's warns of a wave of student loan defaults in coming years.

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Business Week tries a new idea. After 2 years of quiet development Business Week develops the Business Exchange as it calls it. It will have topic pages with topics like the 787 Dreamliner, Blackberry vs. Iphone, and so on. At this time publications are trying a lot of things like verticals, aggregation, user-generated content, popularity rankings, and also something like social networks. Each Business Exchange topic page links to articles and Blog posts from many sources including BW's competitors, with the contents updated automatically by a web crawler. Nearly all traditional news organizations offer only their own content, not taking on the role of an aggregator considering that as an invitation to readers to leave their websites. On Business Exchange a user can create a new page, choosing subject and title and brief introductory description, it would take 24 hours to get permission from BW for this. Objectionable posts would be taken down. Users can also post new material to a topic page. ...

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A dozen Conservative lawmakers including Nicky Morgan support a new customs union with the European Union. The bipartisan motion had the support  of the majority in Britain's parliament. Conservative lawmaker Nicky Morgan stated in parliament that "this country is being asked to experiment at other people's pleasure with a free trade policy where we do not know what the costs will be for constituents and businesses in this country." This reflects changing sentiment in Britain about the costs of Brexit supported by a part of the Conservative Party that includes Liam Fox and Boris Johnson, the Foreign Secretary.  There is a sense that Britain's economy will be hurt by Brexit and Britain leaving the European Union without any way to lessen the consequences of the break in trading relations.

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With stricter border control asylum seekers have dropped to 3500 a day at the US border with Mexico and the new government of Mexico under Caludia Sheinbaum is likely to cooperate with Biden to take back people of other nationalities. President Biden is about to pass an executive order that effectively closes the border with Mexico. Once daily crossings reach 2500 the border will be closed. The legal basis of the action is Immigration and Nationality Act clause 212F which says the president can take this action when he sees that "the entry of aliens or any class of aliens to the United States would be detrimental." This lowers the threshold from 4000 in the Senate bill negotiated by the president with Republican Senator Lankford to 2500 daily crossings. Mr. Trump had the Republican Speaker of the House not bring the Senate bill to a vote in the House. At the time Republicans in Congress said Biden should use his executive authority to do this and lower the threshold. The former president Trump also issued this kind of executive order in 2018 which was blocked in a federal court on grounds of humanitarian protection no matter how immigrants entered the country. This time there is a sense that the Congress, the president and public opinion supports this action and the president's authority. Mexican president Sheinbaum's support will also ease its implementation in 2024 and cut down border crossings from asylum seekers to lows below 2500 till a new Senate bill is taken up and passed with bipartisan support that exists in US Congress. ...

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Important to distinguish in GNP, GDP and GDP per capita. The official rate of 10-11% growth is questioned by Thurow by noting that 70% of China in the rural area is seeing slow growth and if the urban economy has to grow at 33 % if the whole of China is to grow by 11%. He also brings up electricity consumption historicaly growing much faster than the growth rate of GNP or GDP. At breakneck growth rates gorwth has still been 60% of the gorwth in electricity consumption because some of it is wasted or is not used productively.He does not give his electricity consumption growth for China numbers, but we can extrapolate from the 6% growth in China analogous to Japanese growth rates in the 1970's that he comes up with, to see that electricity growth rates he assumes in his math are 10% a year in China. That is based on 6% growth he gives for China constituting 60% of the growth in electricity consumption for China. Given the validity of this math China and India are growing at much slower rates than official math states. This also means productivity of capital remains a major issue and does not simply go away when seeing the countries as a whole not just coastal and other well developed regions of India and China. So the message that is being projected about Chinese growth may be misleading as urbanization in China will still have to proceed for many decades for the growth to even out geographically. Another fact that immigration has been a source of additional people for the USA and so a significant population increase will be seen in the US in the next few decades even as China's population declines, supporting much larger economic activity in the USA. Europe also is seeing no increase in population. Europe's per capita income fell from 85% of that of the US in 1990, to 66% in 2007 according to the IMF statistics quoted here. Validation of these numbers would provide a different assessment of overenthusiasm for the kind of haphazard growth which also wastes resources and sacrifices the environment and shortchanges health, education and other goals, and instead promotes a different view that constantly looks for better ways of meeting the difficult challenges facing China and India. With these...

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The US needs good manufacturing jobs for the jobs and income that it brings into communities, and also because of the tax revenues from the companies making products in America that provide the basis for local governments to provide good public services in healthcare, education, and transportation. To say comparitive advantage that helped first Japanese and now Chinese manufacturers is real and how society gains is to deny some basic facts that are self evident from observation that contradict textbook ideas in economics. Comparitive Advantage is a textbook economics concept that says countries are proficient in what they make best and should specialize in that product. But it is a static concept that exists only in textbooks. If Japan in 1960, China in 1980 and India in 2000 were each presented with this idea they would have turned down the idea of making steel and remained makers of lower end products such as footwear and textiles. If Japan in 1980, China in 2000, and India in 2020 were each presented with this idea they would have turned down the idea of making semiconductors and remained makers of lower end products such as steel. A senior vice president of US Steel in the late 1960's even told this writer a graduate student at Northwestern in Chicago- as the US can make steel better than India or China let us keep making it for you. He and much of the business faculty at Northwestern also could not understand in 1970 why Airbus was being setup to compete with Boeing who by the concept of comparitive advantage should have had the whole market to itself for commercial aircraft . By this kind of thinking Airbus would not exist today because it did not have the lowest cost or the manufacturing technologies Boeing had through its vast manufacturing operation. America would be still the only one making aircraft in 2023 if textbook concepts ruled the day. By indirect methods such as hidden preferential arrangements, provision of inputs such as land, capital and labor, tax relief, the costs can be represented in a way that shows it is cheaper to manufacture overseas. The lack of a level playing field is what president Biden is correcting by doing what first Japan, then South Korea, then China and now India are doing since the 1960's. By 1974 in four years after its founding in 1970 Airbus came up with its first model the A-300 using advanced technologies. America will regain its leadership in the cost and manufacturing of many products through Biden policy and the efforts of American companies by 2030, and do this in a transformative way that will benefit the world as a whole.  It is an enormous error to say the US does not need good manufacturing jobs, that local governments do not need the tax revenues from manufacturing plants to build services for communities where manufacturing workers live, and the US does not need the manufacturing experience curve that leads to reduced costs. It is this loss of the manufacturing experience curve that is the most vital aspect for understanding the need for the US government to compete effectively with the governments of Asian countries to keep manufacturing healthy and strong at home. Economics experts ignorant of how important this science and engineering principle is fail to grasp this. Related to this is the idea of a virtuous cycle in manufacturing- whoever braves the hard years of moving up the learning and experience curve gets rewarded because once that country has mastered that skill it gets better an better as the technology advances- making it harder and harder to prevent a new monopoly in manufacturing by the country (Japan, China or Taiwan) that had the highest costs and the least advantage ten or 20 years earlier but just persevered through it all with the government's help to gain cost competitiveness. This part does not make it into the economics textbooks which are mostly theory and much of it outdated by the time they are written. Observation is the best teacher and guide as it is in science, to guide policy and action. Obsessive attachment to theory that ignores observation becomes the enemy of progress. Comparitive advantage is one concept that needs to be retired even from the textbooks. Overseas manufacturing then is a piece of the overall picture that fits into what is good for the US. Macroeconomic principles determine microeconomic outcomes as opposed to microeconomic principles with companies out on their own being forced to compete without a level playing field, or handing out technology for special status in a recipient country as some do putting the US at a macroeconomic disadvantage. This is also healthy for the recipient country overseas, as recrimination with loss of manufacturing jobs in the US inevitably leads to the kind of recrimination that does not serve either country well as in the case of China today, and worse still can lead to conflict, even war. After the egregious situation of loss of manufacturing communities across the US leading to destabilizing the social fabric, it is hard to see such thinking prevail about the US not needing manufacturing as a vital part of its social fabric and industrial strength. China, it can be said, would have developed, and developed well over the past two decades without overconcentration of US and EU manufacturing in China. Without aggravating the problems of climate change and contamination of air, land and water, and destabilizing the social fabric in the US hurting workers and communities across the US, if macroeconomic policy was made to manage this process in the US government without it being left entirely to individual companies to decide. Instead China faces today a difficult situation through events such as destabilizing the social fabric in the US (the Trump tariffs), advanced economies in G-7 resistance to sharing of technologies, the damage to its environment from microeconomic locally determined policy at individual companies, and the global effects of climate change from climate unsustainable levels of growth since 2000.  ...

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After a decade of austerity and the financial crisis of overextended banks, the deep recession starting in 2009, and worsening inequality with lack of infrastructure development, Britain finally shifts to larger government spending. The spending planned by Labour and Conservative parties in Britain charts a different future for health, education and infrastructure development from that of the last decade. The public supports this. Conservatives plan $128 billion of new spending, Labour party plans to spend even more. This comes after centre right parties such as the Republicans under Mr. Trump in the U.S. shifted to heavy spending on infrastructure. The Democrats under Obama failed to push for higher spending in traditional working class areas leaving open a gap that Mr. Trump has since used to attract working class Democrats to his side. In Britain Labour under Corbyn has pushed for larger spending on infrastructure, health and education. This is setting a new trend. This report in the WSJ shows that in this situation it is new politicians who replaced earlier politicians in their parties- Mr. Trump displacing Bush, Johnson displacing Cameron and May, Corbyn and McDonnell displacing Blair and Brown, that are initiating thsi trend. The experts at the IMF and the central banks are only now beginning to say this is a good idea. For a decade the mantra of economic experts at these central banks was in favor of austerity, even in the face of massive misallocation in capital markets.   ...

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Bradsher, Tankersley and Cohen say in this NYT report- US industrial policy under president Biden corrects the failures of the past. Chinese experts in Hong Kong say the US and Europe deindustrialized their economies with pursuing of policies called "neo-liberal" but basically Reagan era policies that Democratic presidents Clinton-Obama imitated. As they deindustrialized it created disaffection among the struggling lower and middle income classes making $35,000-$106,000 that were big losers in the process, creating threats to democracy as financial and tech, plus pharmaceutical sectors took control of the economy. China's success comes from three decades of mastering the ways of practicing industrial policy that it can support private companies with low cost land, additional subsidies that reduce the cost of production and provide a buffer to absorb losses so that it could dominate key industries. Policies where textbooks and economists trained in the US failed utterly and completely leading to dangers to US democracy that we see as opportunities for good paying jobs in manufacturing disappeared for middle and lower income households from 1980 to 2020. These economists trained in the US always said see lower cost Chinese made goods means lower and middle income people pay less, never saying that this means all opportunities for better paying jobs in manufacturing will be lost for these classes in society. The tech and financial sectors had close ties to the new arrangement that turned manufacturing over to China from the Reagan era to the Obama and Trump era. Apple and Tesla and many industries benefitted from manufacturing mostly outsourced to China. ...

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Prices can top $100 a barrel, some reasons why this is possible including depleted old field and lower production relative to demand. Important article by King and Chazan because of the experts from Aramco, IEA, and Schlumberger being all pretty much aligned in their view and reasoning that not much is happening in the way of oil exploration and production is happening to meet the extra demand from India, China and deveoping countries. Aramco expert cites older depleted oil fields with a 15 year production plateau, Saddad Al- Husseini estimates that price will go up by $12 for every million barrels a day in additional demand. Nobuo Tanaka the new executive director IEA thinks supply will not keep up with demand because many oilresource rich countries are not bringing in outside investors, and also because he is not sure there will be enough investment, skilled workers and technology to to get the oil out in a timely manner. Note there have been constraints in engineering and manpower shortages. And Andrew Gould CEO of Schlumberger says that 70% of the oil fields are over 30 years old, amd just in the last four years from 2003 the demand has increased by the production thats generated from North Sea and Mexico....

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With huge losses at RBS, Prime Minister Brown says he is angry at RBS for the excessive risks taken by the bank. A big chunk of losses of 28 billion pounds for 2008 relate to the deal to acquire ABN-Amro. ABN Amro had on its portfolio a loan to chemical maker LyondellBasell, owned by Len Blavatnik a Russian-American industrialist, which filed for bankruptcy protection in January 2009. Says RBS CEO Stephhen Hester, "we doubled up at the wrong time". Now RBS shares have fallen to 11.6 pence or less than the price of a candy bar. And Brown's administration faces growing criticism that the earlier bank rcapitalization and lending plan has not worked, even as new elections are due by May 2010. With the new deal with RBS government ownership goes up from 58% to 70%, and the next step may be nationalization of RBS. In an effort to limit banks losses and help capital needs of banks, the UK government will insure a majority of losses after the banks assume a first portion of the losses.

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A new West Coast Model is emerging with ballot measures in the states of Washington, California and Oregon. The model is to make up for decades of faulty income distribution which favored tech communities in west coast states leaving behind people from minority communities and the working class outside tech hubs such as San Francisco, San Jose and Seattle. During this period budgets for education and healthcare, social services and essential infrastructure suffered as budgets were squeezed for local governments. Minimum wage also lagged behind and communities struggled to keep up. Washington votes for a ballot measure that raises the minimum wage to $13.25 statewide and mandate paid sick leave for workers. In California a ballot measure makes permanent an income tax surcharge on millionaires to use these funds for education. In Oregon measure 97 places a gross receipts tax on corporations with annual sales in Oregon over $25 million, raising $3 billion a year for schools, health care and other programs. The California and Washington measures are likely to pass, Oregon uncertain, say experts. And even in Oregon supporters have learned from the experience to put forward new proposals on the ballot. The Washington measure is supported by Nick Hanauer, and Zach Silk, president of Civic Ventures in Seattle, who say it is essential to put more money in workers wages to increase growth and to bring better lives outside the tech hub areas. Most of the tech booms of the last two decades have not touched the areas outside tech hub metropolitan areas. The conservative approach adopted in Louisiana and Kansas of reducing taxes first and then when holes in state budgets developed to cut education, health and other service expenditures has not worked, and it has led to the backlash in the form of the new West Coast Model, which is expected to be brought up in other states in the east and midwest. The tech hub areas have grown with the boom in tech but this has largely ignored the rural areas, communities just outside of the tech cities, and led to uneven and distorted growth shortchanging the working class and the middle class, and hurting investment in education and healthcare across each state. Bill Whalen, a research fellow at Stanford University's Hoover Institution conservative think tank ,says that its hard to deny that the balanced growth for all communities across the state has lagged far behind as the tech booms boosted growth in the economies of California, Oregon and Washington. An article in the German online site Zeit on Silicon Valley described this vividly showing how this can happen in communities sitting side by side in the San Jose area, with minority Hispanic communities and working class communties seeing very little of the benefits of growth. ...

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European leaders meeting in Brussels set Sunday July 12, 2015, as the final day by which Greece is expected to submit proposals and reach an agreement with the EU. All EU leaders will be present at the Sunday meeting at which Greece's postion as a member in the eurozone will be settled, and measures for humanitarian aid to Greece can be discussed. EU chief Juncker called Sunday July 12, 2015 the deadline date. Greece's finance minister Tsakalotos surprised European leaders by not having any proposals to submit. German chancellor Merkel said at a news conference- "There are only a few days left for a discussion on what's going to happen in the future. What we need now is a multi-annual program tht goes far beyond the program that we discussed ony 10 days ago." Experts at Bruegel research organization in Brussels say the ECB providing emergency financing is dependent on Greece coming to an agreement with the EU, and if no agreement is reached Greece's exit from the eurozone is very likely....

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Ford Motor opened its new plant in Chongqing, China. It was approved in 2009 and is operated in a joint venture with Chongqing Changan Automobile Company and Japan's Mazda Motor. It has annual capacity of 150,000 cars and will manufacture the redesigned Ford Focus. Ford says this will be part of 15 new models in China by 2015. Further expansion is expected to be slower from now on, because China's policy is shifting towards consoldating its manufacturing base for automobiles- which experienced hyper level growth in the last decade- and not adding new capacity. Ford made a late entry in the Chinese market compared to GM. It sold 519,300 vehicles in China in 2011, compared to GM's 2.55 million vehicles. The change in China's policy may mean Ford has less opportunity to catch up with VW, GM and Toyota in China.

LyrArc Article Gist
The emergence of a national party in India is the subject of this editorial in The Hindustan Times. The Indian National Congress led by Mohandas Gandhi led the way to transitional home rule in the 1930's under the British, independence in 1947, with the party running India till 1962 under Mr. Nehru, one of Gandhi's assistants. This was followed by a breakup of the party into different factions with one faction led by Nehru family forming governments under Indira Gandhi, and her son Rajiv Gandhi. This faction then lost its popularity in the Hindi speaking heartland of Uttar Pradesh, Bihar and became a regional party with presence only in a few states of India and very little in the south. By 2014 a new party the Bharatiya Janata Party had emerged that had a strong presence in the Hindi speaking heartland of Uttar Pradesh and Bihar, Madhya Pradesh, Rajasthan, Gujarat, and in the northeast of the country. It still lacked a strong presence in the south. This has happened in the 2020 Telengana elections, says Hindustan Times. By getting a strong performance in the Hyderabad region the BJP now has a strong presence in Telengana, Andhra Pradesh, and Karnataka where Bangalore is located. Only Kerala and the Tamilnadu region around Madras, have their own regional parties in government. In the east the Bihar elections showed BJP as the leading party to form government to push the development agenda in Uttar Pradesh and Bihar. It is now well positioned to take this theme of rapid development to West Bengal state around the Kolakata (Calcutta) area, a state that has lagged far behind in development under a regional party that was an offshoot of the Indira Gandhi faction of the Congress party. As is common in India national political parties split into factional parties with infighting that split again into purely regional parties. This has further undermined the them of development through failed governance in India. The BJP under the current prime minister is now the exception to this because of its themes of health, governance and development, with Development at the top of the triangle supported by Health and Governance at the base of the triangle. The BJP which started out as a small business oriented upper caste party also changed its image under prime minister Modi. The slogan "Sab Ka Vikas, Sab Ke Saath," (Development for all, with all) has given the BJP support of the lower castes, the Scheduled class and the backward castes in India. This make it a truly national party with support across all socioeconomic and demographic groups. The prime minister's own background growing up working in his father's tea shop near a railway station in Gujarat has also given the party a new image of being with the working classes and the average man. His experience in Gujarat delivering on development projects and infrastructure, energy, has also given the word "development" new meaning for a modern India, very distant from the period when poor governance failed to deliver on development and modernization. Bold moves have cleared the way for a nationwide approach to development, yet decentralized, with rapid development based on accumulation of technologies, human skills, land and capital. A singular focus on the needs of the ordinary people is evident when the prime minister talks about the effect of firewood burning stoves used in cooking by hundreds of millions of rural women for their families. He says the smoke from burning this firewood in the home has the effect of smoking 400 cigarettes for each woman. Rarely has this happened since Mohandas Gandhi took up the situation of village women in the backcountry and lack of clothing in the period under the British.   ...