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Germany went through a period of stagnant growth and persistently high unemployment leading to reforms of the welfare system and entitlements under the Schroeder administration. The reforms led to lower unemployment benefits and an effort to get the unemployed take up jobs. Instead of unemployment benefits that amounted to half the salary indefinitely, unemployment benefits ended in 12 months under the reforms, and workers were forced to take up jobs or dig into their savings. The cuts to benefits led to more of the unemployed taking jobs that were not their first choice with lower incomes. Unions agreed to defer wage demands and wages remained relatively flat for a long period. The "kurzarbeit" system of government subsidizing employers to retain workers during economic downturns, helped cushion the workforce from ups and downs in the economy. Unemployment which was in double digits a decade ago, is now 6.1%. The system still preserved some other aspects of generous benefits- parental leave of 14 months at two-thirds salary, vacation time and publicly sponsored health insurance. Recent changes include raising the retirement age to 67 from 65. The Organization of Economc Cooperation and Development estimates that the 200,000 jobs saved in Germany during the recession of 2008-2009 cost the government $7 billion. Government funds helped companies retain workers by paying a portion of worker salaries and averting layoffs.This comes to $35,000 per job. Compare this with the $38.9 billion allocated to a loan program at the Energy Department under the U.S. stimulus. 8050 jobs were created under this program according to the Washington Post- for the money spent so far in Sept 2011- 2 years into the loan program, of $19.3 billion. This comes to $2.4 million in government guaranteed loans per job. The Energy Department says that 33,000 jobs were saved under the $5.9 billion that was given to the auto industry under this program for investments in manufacturing to improve fuel efficiency. This comes to $178,000 per job. The Energy Department and Congress estimated a 5%-10% loss on the $38.6 billion loan program for loans that go sour, such as the Solyndra solar company $535 million loan. This comes to $1.9 billion at 5% loss and $3.8 billion for a 10% loss. The purpose of these figures is to show the cost of programs when the programs fail to achieve job goals or produce too little for the investment. The $3.8 billion loss under the program is over half the $7 billon Germany invested for the 200,000 jobs saved as estimated by the OECD. That ranks as a far superior investment than the Energy Department program. For the U.S. there are aspects of German reforms such as "kurzarbeit" that bear emulation, with serious questions about the effective use of the U.S. stimulus funds. For the rest of Europe the stingier unemployment benefits, raising the retirement age to 67, and other reforms send a different message. From the average German the message is: we made the tough changes, the rest of Europe cannot expect Germans to pay higher taxes while they put off similiar changes. Italy needs to change its retirement age, just as the Germans have done. As Chancellor Merkel puts it: "People in countries like Greece, Spain, Portugal shouldn't be able to retire earlier than in Germany. It's important for everybody to put in effort to make it roughly equal. Germany will only help when others really make an effort." Which is why Greece, Spain, Italy, even France are faced with making serious changes. This isn't stalling when it comes to euro bonds, from the German perspective. And it isn't about the lack of committment to the idea of a European Union, as all major political parties in Germany, the CDP, the SDP and the Greens, all strongly support the idea of a European Union. ...

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Former U.S. president Bush says the U.S. has an important role as a beacon of freedom, human rights and democracy in the world. The U.S. should not shrink from the challenges in the name of a false and temporary stability, and flexibility should not mean ambiguity, difficulties should not mean shrugging away from America's role. Patience, creativity and active American leadership are needed. The Bush administration supported the struggles of people in central Europe and in other countries. This is from a speech Bush gave at the Bush Institute, Southern Methodist University in Dallas, a year into the Arab Spring. A speech that was giving voice to the aspirations of people in the Arab world.

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Unemployment is over 25% on Chicago's South Side black neighborhoods. Conditions have deteriorated with the higher unemployment since the economic crisis. Residents see little improvement since the days of Obama as a community activist in this part of the city.

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The IMF's managing director, Christine Lagarde, pointed to the urgent need to recapitalize European banks in September 2011. European banks face potential losses of 120 billion euros for Belgium, Spain and Italy, 60 billion euros for Greece, 20 billion euros for Ireland and Portugal, and 100 billion euros for other banking exposure, for a total of 300 billion euros, according to the International Monetary Fund. In the absence of recapitalization there could be further damage to EU economies from restricted lending by banks. IMF estimates show that deteriorating credit conditions could damage growth in the eurozone countries by 3.5 percentage points, and in the U.S. by 2.2 percentage points, creating another recession.

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An audit of Spain's banking system by the consulting firm Oliver Wyman, shows that Spanish banks would need 53.745 billion euros to be cleaned up if mergers and acquisitions underway are completed.The amount goes up to 59.3 billion euros if this does not happen. Bankia bank will need 24.7 billion euros to meet capital requirements. Three other nationalized banks need 21.5 billion euros, including 3.2 billion euros for Banco Popular. Of the 14 audited banks only 7 need capital infusions. The other banks considered healthy include BBVA, Santander and La Caixa. These findings are similiar to a preliminary finding by Oliver Wyman and estimates provided by Luis de Guindos, Spain's economy minister, that Spanish banks will need 51 billion to 62 billion euros of capital infusion. Spain's secretary of state for the economy, Fernando Jimenez Latorre, says Spain will soon request about 40 billion euros of the 100 billion euro bailout offer for banks negotiated by Spain in June with the EU. It is not clear whether the capital infusion will go directly to Spain's banks as Spain has argued, or go through the Spanish government. The audits were important to provide credibility through independent assessment of losses in Spain's banking system, and remove the fog of uncertainty that is pushing up Spain's borrowing rate in capital markets....

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This editorial in the New York Times is strongly critical of former president Barack Obama for accepting $400,000 in speaking fees from Wall Street for a single speech. It says the news is causing people to question the ideas and words presented by Obama in his books about the dangers of losing sight of the interests of ordinary people. It gives the impression says the NYT, that Obama is cashing in like everybody else, and that his talk was empty. The editorial says the millions raised by Hillary Clinton led to her defeat in the election. Obama is reported to plan a foundation with the work of training a new generation of political leaders. This NYT editorial says it would be better to stay true to vision and purpose, to walk the talk for president Obama, especially now that a recent poll shows two thirds of voters, including about half of Democrats say that the Democratic Party is out of touch with the interests of the American People. By associating this closely with wealthy donors leading Democrats contributed to this. During a period when some of the remarkable achievements of the last fifty years such as the European Union are being called into question, when ordinary working people, young people and older people are struggling, this is all the more a tone deaf approach by politicians. The idea of helping train a new generation of political leaders through a foundation sounds bizarre in this context, and seems to suggest politicians believe there is always a solution through marketing their audacity and money.   ...

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Frederick Harris of Columbia University says there is a price to be paid for a black president and it may just be too much for the average black person. There is a difference betwen symbols and substance, betwen a role model and accountability in a representative democracy, which is sadly lacking when the black elites, clergy and politicians fail to debate the issues about the problems facing the black community. Problems related to the increasing poverty among black Americans, and the 14% unemployment for black people. There is he says a strange reticience among the black elite to hold the president accountable on these issues just as they would have done for any Democratic president, even one who was as popular with blacks as Mr. Clinton. He says the experience with Obama is not even remotely comparable to the transformative nature of the work of Rev. Martin Luther King in the black community. It may stem from Obama's multiracial background, growing up in many countries, his elite education and being part of a liberal elite more than of the black community. The price is too high in economic and social terms for the poor or average black person and it has created a divide between the average black person and the black elite, with different concerns and different priorities. Harris points out that poor and poverty are words not mentioned often by Obama. Related to this is the foreclosure crisis in which ordinary black people were hardest hit with no effective help from the president to homeowners badly needing relief. Sheila Bair of the FDIC and Martin Feldstein advocated aggressive help for homeowners under water which did not come from the president. Showing not just the limits of a black presidency, but false hopes, inexperience and lack of leadership in issues that mattered to all Americans in the housing and foreclosure crisis. A populist from Kansas, as Sheila Bair describes herself, had the right instincts and courage of convictions which the president lacked and the entire country needed....