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The $350 billon in proposed cuts to Medicare and Medicaid in the 2011 deficit reduction talks will do little to reduce the rapid rise in medical costs. Instead it shifts the costs to seniors, state governments and public hospitals. Gail Wilensky, former head of Medicare under the first President Bush and now a senior fellow at Project Hope, says this should not be confused with real reform to Medicare which reduces the rapid increase in costs. It does little in the way of fundamental changes that would reduce the growth in costs. About $53 billion comes from reductions to senior's ability to buy extra Medicare supplemental insurance or Medigap. Another $14-26 billion would have the government reduce payments to hospitals for unpaid debt. The few items to curtail fraud in the use of CT scans or purchase of power wheelchairs would provide savings of $2-3 billion over 10 years. $4 billion comes from lowering Medicaid payments to hospitals treating a high percentage of low income patients, hospitals such as Cook County Hospital in Chicago, San Francisco General Hospital, and Parkland Hospital in Dallas....

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Social entrepreneur Mycoskie found the idea for TOMS shoes when he visited Argentina in 2006. There he found the traditional alpargata cloth slide-on. He popularized it in the U.S. by offering to donate pair of shoes to a child in need for every pair of TOMS shoes sold at stores.

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ECB president, Mario Draghi, is interviewed at his office in Frankfurt by the Wall Street Journal's Blackstone, Karnitschnig, and Thomson. Draghi quotes economist Rudi Dornbusch, who told him in the old days that the Europeans were rich enough to afford paying for it if everybody didn't work. Draghi, was head of the Bank of Italy, before becoming president of the ECB. He is acutely aware of the problems faced by Italy and other countries like Spain which have let labor markets become rigid, with extensive job protections and generous benefits for the unemployed. The result is that employers are reluctant to hire and young people face high unemployment rates- as high as 50% in Spain. For this reason Draghi sees the old social model in Europe as obsolete and already out. Draghi's sees austerity measures and spending cuts with the structural changes underway in Spain, Italy and other countries as the only way to generate economic renewal. On the Long Term Financing Operation launched by the ECB in Dec. 2011, Draghi says there was agreement within the ECB and the decision was unanimous. He makes it one of his objectives to achieve as much consensus as he can, to do what is right for Europe and to do it together with his colleagues in the ECB and the EU. That financing operation, and the binding deficit controls achieved at a recent summit of European leaders, he sees as all part of the pathway to fiscal union. ...

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Treasury Secretary Paulson has emerged as the critical bridge builder within the Bush administration to get some tangible economic results in the spirit of bipartisan cooperation. It has not been easy in a Bush Presidency that has not valued compromise and cooperative relationships with Democrats. Treasury's influence, unlike the Rubin days under Snow and his predecessor, has been overshadowed by the politics of the Bush administration. Some of his initiatives had not fared so well, the efforts to reform Social Security and Medicare. The China-America dialogue may have reduced tensions but still did not amount to something significant. Now with Bush going his own way on Jan 18, 2008 to announce his own stimulus plan and spurning Democrats efforts for a bipartisan agreement and making them feel left out and angry, Secretary Paulson finally got into his own groove of compromise, diplomacy and deft bridgebuilding to get restraint from Bush. He worked out the details in the meantime to forge an agreement by the following week. Paulson was instrumental influence behind this stimulus package. His disregard for ideological debate in an administration that has been too close to this and not known for cooperaive relationship building, is a breath of fresh air in an otherwise desolate field of politicking. Particularly helpful in the middle of a risk laden economic situation for the country, and the other global economies that are intertwined with the US economy....

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Biden sees his plan for American workers and families put together in the $3.5 trillion spending package that covers child care, education, healthcare, services, climate change proposals, infrastructure building, as a way to show that democratic governments can work for the people. After two decades when American workers and families were largely put aside in the nation's priorities during a tech driven and capital markets driven expansion that benefited large corporations, America is returning to its core concept of government by the people, for the people, of the people. White House officials say this is to be seen even in the program he put forward in his upset victory many years ago for the US Senate from Delaware. Because economic strength of America depends on a strong middle class, and strong working class, strong families, and underpins the world leadership role of America, even Republicans and hesitant Democrats, cannot give in to the current situation of doing nothing or too little for workers and families which weakens America. And at a time when its leadership role in Asia and Latin America, Africa is sorely needed. The size of the package in $3.5 trillion is because too little was done in the past in the mistaken acceptance of Reagan policies of no government role in the economy- surrendering this role of guidance entirely to the capital markets driven from New York, London, and Silicon Valley. The rise of China today, and also of Japan and South Korea, and of India as it plans for 2030 shows that government guidance of the economy is needed in global competition. Trade entirely driven by capital markets, without a role for government to emphasize national priorities in spending can lead to disastrous results such as we see today where manufacturing even in critical fields such as healthcare, semiconductor driven technology, entire parts of the economic structure are ceded to China and supply chains outside the US. German elections are also leading in the same direction with Social Democrats emphasizing national priorities in child care, education, healthcare, and delivery of social services, building of infrastructure. And the Greens emphasizing climate change. Merkel in Germany and in the European Union, her predecessor Schroeder, pursued policies of no government role in emphasizing and articulating national priorities, in a way that past US presidents have done, resulting in the CDU falling to 20% support in the September German elections. Across all parts of the world, from India, China, to Europe and the US, the focus is on government voicing the national priorities  and allocating funding instead of capital markets driven from London, New York and Silicon Valley, or capital markets in Shanghai or Mumbai, as the pandemic runs into its second year. ...

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The head of the CDU party who would become chancellor after Merkel, makes an emotional plea to the British people to change their mind and remain in the European Union. In an affectionate letter to The Times of London many leading figures from politics, industry and the arts in Germany made a plea that Britain remain in the EU "from the bottom of their hearts." A look at dozens of letters in response to this article in The Times shows that many Britons feel that Britain would have voted to remain if Germany and Merkel had given prime minister Cameron a better response during negotiations in 2016. Even chancellor Merkel warned Germans not to take an indifferent or complacent attitude to Britain's staying in the EU. The letter makes amends by saying there is an indissoluble bond between Britain and Germany because of the help given by Britain to rebuild Germany after the war. "Without your great nation this nation would not be what it is today, defined by freedom and prosperity," the letter says. It says "should Britain wish to leave the EU it will always have friends in Germany and Europe. But Britons should equally know that know choice is irreversible. Our door will always remain open: Europe is home."  Katarina Barley, Germany's Justice Minister whose father is British, says she supports a second referendum on Brexit. The letter is signed by Andrea Nahles, head of the Social Democrats, Annalena Baerbock head of the Greens party. Also signing it are the heads of Daimler, Airbus and the German Federation of Industry. Annegret Karrenbauer, head of the CDU says it is looking for constructive proposals from Britain, now that the deal put forward in the British parliament was defeated by a large margin. "We will not block the path to Britain remaining in the EU." The letter is significant in that it changes the whole tone of German leaders across the spectrum towards Britain- as critical to the idea of Europe, and the dawning in German minds that Europe would never be Europe without Britain, would never be Europe simply with France and Germany and the other nations. ...

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Atul Gawande in the New Yorker shows how doctors in McAllen, Texas prescribe half the tests that doctors in other comunities in Texas do. Frank cites the effectiveness of the salaried model used by the Mayo Clinic. This battle has been postponed for another day the current halth care reform bill. But crucially the failure to tackle this program and have the country shoulder another deficit burden for healthcare leaves the country with a serious liability of overspending, with guns and butter if the Afghnistan war adds up another big bill to the Iraq war bill.

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Putin reminds Russians of the precarious nature of all that has been achieved in Russia, as he seeks support from areas outside Moscow. He wrote in an opinion article in February: "Under the flag of democracy, in the 1990's we received not a modern government, but an opaque fight among clans and numerous semifeudal fiefdoms... We received not a new quality of life, but huge social costs; not a just and free society, but the highhandedness of a self-appointed elite, who openly neglected the interests of simple people." Emphasizing the tenuous and uncertain nature of the recent prosperity, Putin said in a televised appearance: "It is enough to take two or three incorrect steps and all that came before could overcome us before we know it." Schwiritz visits the town of Lyubertsy outside Moscow and hears from ordinary people who remember the privation and dark times of the 1990's, who realize that their lives can be much better, but also see the vast improvement in living conditions. There is a real and tangible fear that all this could be lost or eroded. It also shows that as Moscow and St Petersburg have grown and flourished in the last decade with a strong middle class, there is a great deal of uncertainty felt by ordinary people in smaller towns and cities. As for that period in the 1990's, even young activists like Navalny, say a lot was done in the early years of the Putin-Medvedev government, when even Russian mortality rates were falling with a general sense of despair. ...

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With about 390 million users smartphone user penetration in India is the second highest after China. WalMart, Amazon are looking for new online customers with large investments. New tech rules from the government require these companies and Google to store data in India. This means companies that store data in servers located all over the world such as Google have to change the way they store Indian data. Under the new regulations in draft form data created by users in India from online sellers, search engines and social media must be stored exclusively in India, with government granted access.

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Election expert Karl Rove from the Republican Party goes over the math for the nomination for upcoming Republican primaries in New York, followed by primaries in Delaware, Maryland, Connecticut, Rhode Island, and Pennsylvania. He says the anti-Trump movement would still be in the lead at the end of these primaries. His figures are that Trump stands at 743 delegates on April 7, 2016, citing the Associated Press, and the non-Trump delegates at 897, ahead by 154 delegates. In New York primary of April 19 only 14 of the state's 95 delegates go to the winner, the rest are given three for each of 27 congressional districts. two to the winner and one for the second place finisher as long as the winner is less than 50% and the second place candidate has 20%. Delaware has 16 winner take all delegates, Connecticut and Maryland have 28 and 38 winner take all by congressional district, Rhode Island 19 proportionally. Interestingly Pennsylvania is cited by Rove as having only 14 statewide winner take all delegates, with 54 officially unbound congressional district delegates, contrary to popular impression that it is winner take all state wide. The elections in South and North Dakota, and Nebraska, give Cruz some of the delegate offset to control the gap in delegates between him and Trump created in the northeastern states. A factor in the race is also the change in the Cruz campaign made for Wisconsin where Cruz was able to win by 14 percentage points by expanding his message to Jobs, Opportunity and Growth from the social conservatism message that did not counter the Trump message to conservative and working class voters on the economy and trade. Another factor is women's vote trending away from Trump. ...

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This WSJ editorial on the sliding scale with lower capital gains taxes for investments held for a longer time frame proposed by Hillary Clinton, says there is no economic theory that shows one or two year investments are worse than longer term investments, and says investors who invest in startups and cash in after a year or two can then invest in other startups increasing investment capital. It points out that new startups are fostered better in an environment where capital gains taxes do not promote holding investments for a longer term. Hillary Clinton is calling for higher capital gains taxes on shorter term investments. The current rate is similiar to the 20% rate under Bill Clinton. George Bush lowered it to 15%, and president Obama increased this to 20% for couples earning more than $484,851 a year, and added a surcharge of 3.8%. Under Reagan it was initally 20% in 1981 and in 1987 as part of tax reform cutting the top income tax rate to 28%, it was 28%. Hillary Clinton's plan is for it to be based on how long investors hold their investment discouraging 1-3 year investment horizons- Year 2- 43.4%, Year 3- 39.8%, Year 4- 35.8%, Year 6- 23.8% or the current rate for the highest income bracket. Investments in infrastructure and long term research projects leading to new technologies and products require a longer horizon encouraging such investments. The Clinton plan appears to be a response to the tech bubble with investments in small tech changes and software improvements that have led to surging investment in startups in social media and other areas which have not yielded the productivity gains needed to support increase in wages- resulting in low productivity and low wage gains in the last decade....

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Martin Feldstein on the U.S. economy in 2014 and the risks of the U.S. Federal Reserve tackling the economy on its own with monetary policy, without Congress taking on the task of policies to promote economic growth. Feldstein points out the 3.6% GDP growth estimate for the third quarter 2013 does not look that good considering that half of this is from buildup of inventory. GDP growth is about 2% as net result. With paralysis of Congress and the Executive branch the Fed's policy of huge buildup of long term bonds to reduce short term interest rates to zero and stimulate stock and home prices, he describes as the only game in town. The problem is that the size of the effect of increase in consumer spending from this increase in household wealth is small and not enough to contribute to significant GDP growth. The risks of this approach are that it contributes to destabilizing the economy as investors buy risky securities and bid up prices. He suggests a five year $1 trillion infrastructure development program, including defense, as a stimulus Congress should consider. Not the kind of stimulus that happened after the 2008 crisis. If not enough investment ready projects are available as in 2008 that will contribute to future growth, Congress should take another one year to prepare for this before moving forward. Debt reduction is key, and debt as a percentage of GDP should be reduced and set on a path to go where it was before 2008 to about 40%, deficits to below 2% of GDP. This should be done by slowing growth of Social Security and Medicare, and increasing revenues by limiting subsidies in the tax code that Feldstein as pushed for since 2010....

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The step that Osborne took to lay out Britain's Conservative party's plan to tackle Britain's awful deficit of $280 billion, and making this journey through the bleak landscape ahead is forbidding but enormously useful, says the Economist. Everyone shares the burden equally and the Conservatives will keep the 50% tax on higher incomes, raise the age for pensions, freeze public sector pay in 2011, take away middle class tax breaks.

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Educational opportunity and mobility in the EU countries compared to the U.S. and Britain. Germany and France have maintained access to educational opportunity as a path to upward mobility for people of all classes in society. The deterioration in educational opportunity and access in the U.S. has long term consequences. It is also rarely mentioned in comparisons with Europe. Both sides of the Atlantic still espouse the same ideals for access to education for all, part of the ideals for their framework for democracy, even as the U.S. falls behind in practice. Better educated societies across all classes of society with upward mobility can also make more informed and better choices for society and government.