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Alan Blinder, a professor of economics and public affairs at Princeton University, looks at explanations for low productivity growth since 2010, and points to the most likely reason- the lack of technological progress with the kind of impact that the personal computer and other innovations had in the period 1995-2005. Facebook, Google, Amazon and Apple tech innovation has more impact on consumers than on the industrial economy and production. Lower investment since 2010 with the financial crisis could have added to this, but to a smaller degree, says Blinder. Blinder even points to some hours of work being taken up by workers using Facebook, Twitter and other similiar services. The notion strange to Silicon Valley is supported that tech progress, dynamism and entrepreneurship may have actually declined to some extent. Intel's Andy Grove, no stranger to early innovations supported this notion around 2008, saying he saw less innovation of the type he was familiar with, more refinements than breakthroughs by startups in Silicon Valley. Grove was critical of the decline in manufacturing in the U.S., which is likely to have hurt productivity growth....

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Fuel efficiency standards were left way below the rest of the world, just look at the graph showing Japan and Europe way above the US in fuel efficiency standards, and the US lagging behind badly. Europe and Japan with standards close to 40mpg vs the US below 30 mpg. Any sharp business person can tell one that if there was too big a gap, it would be a cause for serious concern, because the Japanese for instance would also have developed the technologies and manufacturing facilities to support the fuel efficiency standards. There were some serious dangers in falling behind. That is what has happened as the Japanese carmakers have take market share from the US in the American car market.

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Obama says oil sand leave a big carbon footprint in his interview with the Canadian Broadcasting Corporation, just before his visit for talks with Candian Prime Minister Harper in Ottawa, Canada. The talks will focus on climate change, whether the oil sands can continue to be exempt from regulation, and other issues including a "Buy America" provision.

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Health and Education are the best bets for investment to revive the economy. BW's Mandel says the health and education fiscal channel is still functioning, while other ways of stimulating the economy are in breakdown mode. Taxpayer money given to banks, businesses and households will be saved to pay down high levels of debt and because of uncertainty. But funds directed to schools and hospitals will be spent to buy new equipment, modernize and update, put up new buildings, and hire workers. Health care especially is keen on hiring new nurses, medical technicians, home aides, and so on. And over the past year health care and education workers have risen by 500,000. In these hard times the hardest hit areas like Michigan have seen health and education make up 23.7 % of jobs, while manufacturing has dropped to half that, only 12.5%. And in the past decade health and education has had a stabilizing influence already. Nationally these areas have hired steadily, adding 5.3 million jobs since 1999. Meanwhile the rest of the economy has seen booms and busts, and off shoring and outsourcing overseas, with only 400,000 new jobs created in 10 years. Education has suffered neglect for needed infrastructure including broadband and internet capabilities for classrooms, and health care suffers inefficiencies such as computerization of records, and cost inefficiencies. These areas can be modernized and improved, adding to benefits years from now. They are large sectors employing 30 million workers or 22% of the workforce, and now badly needed to stabilize the economy as these employees are well paid and could help keep consumption from falling badly. A Gallup poll taken in February, shows 56% of Americans showed that education investments were "one of the most important items " for stimulus spending, coming out on top, and beating tax cuts....

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With Whitacre in charge at GM there is a change of style and substance that just flows from who the man is. He is a no-nonsense guy, who once told a colleague from his days at Southwestern Bell, that God gave us two eyes and one mouth for the right reason so we should use it in that proportion. He is quite matter of fact about approaching the probems at GM right from the beginning. From those early meetings at the Westin airport hotel in Detroit, where he would tell GM executives and Henderson that if things did not happen the way they should and quickly he would find the right people. After there was a lot of soul searching about Henderson's decision to sell Opel- and three directors with private equity background decided it was bad for GM, that GM needed Opel for its compact and midsize car engineering and sales volume- Henderson was replaced as CEO. The decision was reversed. Within 3 months of Henderson's departure four other executives were let go, 20 more were reassigned and seven outsiders were brought in to fill top jobs. Lutz was marginalized. Reuss in his forties was placed in charge of N. America. The metrics were simplified from Wagoner's days to six: market share, revenue, operating profit, cash flow, quality, and customer satisfaction. His approach to get managers who make decisions fast and correct mistakes speedily. Vice chairman and CFO, Christopher Liddell, is from Microsoft and joined in January. Liddell points out that 12 of the 13 person GM executive committee are either new to the auto industry or outsiders. And the seniormost Whitacre and Liddell, are new to the auto industry and outsiders, so Whitacre can point out that GM has run the business in a more complicated way than it needs to be. The big changes are cultural. And making these changes for a company the size of GM and with the trauma that happened at GM with the speedy decline, required someone with the experience Whitacre gained in tackling the problems he faced at Southwesten Bell and the new AT&T, with its changing culture. The tough down-to-earth nature of the guy, with no affectations or layers to his personality whatsoever, proved an asset at the new AT&T and now at GM. Other decisions he has made at GM, are some strategic ones like bringing down incentives to sell cars, the latest being letting market share drop in March in the face of Toyota's heavy use of incentives to recover from the recall crisis, but sticking to reducing the incentive dollars by $1200 to $3500 per car. This made it possible to achieve sales goals. And some tactical but of great significance, from a common sense approach to GM advertising with his remark "I'm sick of Howie Long." Pitchman Long was a football player, and what Whitacre insisted on was showing off GM's best models and features to blow the competition, like the "May the Best Car Win," campaign. That many of GM's ads didn't focus on the cars and didn't make any sense, like little Cadillacs flying out of a birdhouse, makes this truly incredible to an outsider. Other things Whitacre brings are a change in his expectations, and his overall demeanor. This impatience may be a good thing for GM especially with the capital investment in new models, plant investment and better decisionmaking, and commonsense approach, to back it up. In the car industry it can't hurt for the top guy to look at the car clay models and ask why they can't be brought to market in 12 months. It gets people thinking differently. Asking a Cadillac dealer he knows in San Antonio why they should'nt be selling twice as many Cadillacs if the marketing was better. It helps when the top guy can visit a plant and have "diagonal slice meetigs" with plant staff, workers and UAW people, to talk about things in sweat shirt and jeans with no airs about yourself whatsoever, and to follow this up with a repeat meeting some months later and announce a $136 million investment, as he did with the Fairfax plant in Kansas....

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The WSJ's Juan Montes, in an exceptional report from Mexico City, tells the story behind a landmark achievement for Mexico- Pacto Por Mexico of Dec. 2, 2012. The major political parties of the right, centre and left forge an agreement for the way forward for Mexico- beyond monopolistic pricing and industry structures in Mexico that hurt consumers, to increase foreign investment and new technlogies to modernize the national oil company Pemex operations, change labor laws, and create a climate for higher growth. The pact is broad ranging, shows a grasp of the problems facing modern Mexico, and ranges from anti-monopoly laws to getting junk food out of schools considering Mexico's high obesity and diabetes rate. It covers 95 goals. It is hard to overstate the significance of this achievement for modern Mexico. Montes describes the initiative of the PRD leader Zambrones in rebranding his PRD party as a moderate left wing party open to new ideas. This happened after the departure of Lopez Obrador from the PRD to form his own party in September. Zambrano and PRD moderates brought up the idea based on what happened in a landmark deal in Spain in 1977, that helped transform Spain after decades of stagnation under the Franco dictatorship. Around July after the presidential election, PRD president Zambrano, and the PRD's Jesus Ortega, held meetings in Mexico City with Jose Murat, a senior PRI politician, and PRI president elect Nieto's top advisor, economist Luis Videgaray. The decision was made by president Nieto and economist Luis Videgaray to pursue the discussions for joint agreement on vital issues facing Mexico. The PAN party was brought into the discussions. By mid-September nine people from the PRD, PRI and PAN started work on a draft agreement at Murat's home. The ground rules were set for discussions to be private, to have agreement on all points or assume nothing had been agreed, and not let current events disturb the talks. The nine participants set up the broad principles, and then a group of three, one from each party was given the task of coming up with the right language for the pact. By the end of November a 34 page draft was put together. A night of intense work to 2 a.m. followed the inauguaration of president Nieto on Dec. 1, with the Pact ready for announcement on Dec. 2, 2012. The Pact is a landmark achievement in its potential for changing Mexico and creating decades of economic progress similiar to that envisioned by the Spanish parties for Spain in 1977. ...

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Malone describes the future of Silicon Valley and a return to its roots in a world of new devices closer to where Dave Packard and Noyce (followed by Jobs) started the first tech developments in California. He sees a larger Silicon Valley spread out over a much larger region by 2050.

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Incentives for automobile sales are increasing back up to about $3000 a year from $2000, as auto sales reach a level of 16.3 million annual sales in month of October 2014, according to KBB analysts.

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The Ifo Institute monthly business confidence survey shows a reading of 104.7 for November, up from 103.2 in October 2014.

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Prof. Cusumano of MIT, says that with the loss of Apple's Steve Jobs, the company has lost a great visionary, and it will be difficult for Apple's new CEO Time Cook to make up for this loss. Cusumano has talked to many Apple employees in 2013-2014, and is writing a book on innovation. In this piece Chen and Richtel point out the ways Tim Cook is trying to fill the role Jobs filled, by assembling a group of people within the company who can play the pioneering role for new products, and making new acquisitions such as the Beats acquisition to bring in outside talent. Cook pushed for the introduction of the iPad Air, which now accounts for 60% of all iPad sales. The constant push for the magic in new products that Steve Jobs obsessed with down to details, will be missing. Jobs met daily with design chief Jonathan Ive for lunch at the Cupertino headquarters. Cook meets Ive 3 times a week. And Jobs pulled all the pieces of the new product together in a way that others will have difficulty doing. Cook has brought a different dimension to leadership at Apple by talking about Apple in terms of "advancing humanity," talking about his own personal experiences in the South, and seeing racial discrimination barriers for minorities. He was challenged recently to address issues of working conditions at Apple supplier factories in China. Cook is bringing some manufacturing back to the U.S. with building of new plants in Arizona and Texas. These are areas which were gaps in Jobs record, which Cook is filling gradually, and asking shareholders, customers, to be patient....

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Sergio Marchionne, CEO of Fiat-Chrysler told a conference in Michigan -"these are people who did not grow up and become conditioned to doing business in Detroit. " He cited this as one reason the new generation of leaders at the U.S. auto companies had embraced the new fuel efficiency standards. Another point he made that was well received was that "anybody who surrenders 14 years before the date ought not to be in business." He was referring to the 2025 deadline for the new standards. This view was well accepted by the other auto companies and by the UAW workers union, showing the big change that has come about in the U.S. auto industry.

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Car size shrinks as the Focus, Spark, Aveo, Cruze small cars attract attention at the 2010 International Auto Show in Detroit. The big change is that these small cars are following the European small car in being refined and sophisticated, with a lot of features. This isn't the Chevette that Americans knew in the sixties and seventies, and the perception of what is the right size and comfort is changing completely as a new generation of buyers brought up in a world of pc's, i-phones, and globalized cultures is in the driver seat.

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The turnaround at Ford Motor Company described in Detroit News reporter Bryce Hoffman's book "American Icon: Alan Mulally and the Fight to Save Ford Motor Company."

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During 2012 and 2013 the U.S. put pressure on China and India to cut oil imports from Iran to increase the effectiveness of sanctions. As negotiations eased the sanctions, China increased oil imports in 2014 by 30% in 2014 over the prior year. China's Foreign Ministry sees a "win-win spirit" in the nuclear deal that opens up economic relations with Iran. Analysts say China has setup three new storage facilities on its eastern coast with about 45 million barrels of new capacity, which could be filled with new supplies as its growth slows and demand decreases. China's imports were about 7 million barrels a day in June 2015.

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The Obama administration is pushing for new U.S. fuel efficiency standards of 56.2 mpg by 2025. In May 2009 President Obama announced domestic car and light truck fuel efficiency standards of 35 mpg by 2016. Europe is expected to reach fuel efficiency of 60 mpg by 2020. This would still leave Europe considerably ahead of the U.S. in fuel efficiency for automobiles, but the gap would be much smaller. For the last several decades the U.S. has fallen sadly behind Europe and Japan in fuel efficiency. The perception of poor fuel efficiency hurt the automakers badly during periods of high fuel prices and when buyers were facing difficult economic choices. The automakers are beginning to grasp this fact. Mark Reuss, president of General Motors, commented that- "it's very challenging, but its upto us engineers to provide high value to the customer and support the environment." This is an issue that has serious national and global implications as it affects the future prices and demand for oil, emissions, and future economic growth. It would also bring the U.S. in line with Europe and Japan when it comes to fuel efficiency of automobiles. ...