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This report in the Economist magazine points out that income per head has gone up only 40% over 30 years of democracy and economic liberalisation. And most of the benefits from NAFTA trade agreement have gone to northern Mexico where most of the factories have been built. Southern Mexican states like Tabasco were badly neglected. Lopez Obrador's party Morena is an allusion to La Virgen Morena of Guadalupe, Mexico's patron saint, and also to a term used to describe darker skinned Mexicans. Obrador was born south of Mexico City and sees his goal as bringing industrialisation and infrastructure to the south. He vows to pave every road in Oaxaca and offer price guarantees to southern farmers. And even northerners are excited about him because of his nationalist instincts, and corruption and violence under president Pena. The disappearance of 43 student teachers in gang violence was a terrible incident in the wave of violence under president Pena which has horrified Mexicans of all classes.  Under Pena Mexico is tied with Russia in the Transparency International Corruption Index at 135th place and it is more blatant in Mexico than ever. ...

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The situation in nursing homes and eldercare is a huge black eye says this report from Canada. The situation is poor also in the U.S. and Britain. All the Anglo-Saxon countries appear to have the same problem of neglect of eldercare and homes for older citizens compared to say Japan, Germany or France with different healthcare systems and more invested in these areas of health and older citizens.Look at the numbers- in Canada 80% of deaths from coronavirus among older people in nursing homes. Next Ireland at 62%, and the U.S. at 40%. This report says these elder care facilities in Canada are run down, poorly equipped and understaffed. Canada's armed forces sent medics to the nursing homes in Quebec and Ontario and their reports are described as distruging and worrisome by prime minister Trudeau. In these countries lawmakers and policymakers have failed, and the culture of investing in areas other than health and public services and infrastructure, has failed the people. A poor scorecard for this generation of politicians, lawmakers, and leaders both in business and the government. ...

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In a major policy move India's Modi government makes major changes for foreign investment in India. In different sectors, pharmaceuticals, defense, civil aviation, and retail stores, the move is designed to attract investment and create new jobs. Foreign investors can now take 100 percent ownership in defense, civil aviation, and food products sectors with government approval. In pharmaceuticals foreign investors can take upto 74 percent ownership with no government approval needed. In retail stores, such as for Apple and Ikea, the rules offer new incentives. From now on the requirement that Apple and other companies buy 30% of their supplies locally for single brand retail stores will be relaxed with a 3 year exemption on local sourcing, which can be extended to 5 years if the products sold are "state of the art" and "cutting edge technology," according to a government announcement. The changes were made by executive order. Apple CEO Tim Cook visited India and lobbied for this change recently. In combination with a national GST goods and services tax to be passed in July 2016, which is to be instituted nationally to replace a old set of state by state requirements and taxes, the two changes could have a bigger impact than the 1991 reforms that moved India away from a socialist managed economy. Poor job report numbers may have increased the pressure for taking action. In the defense sector the earlier change to allow 49% ownership had resulted in few new proposals. The changes in foreign investment rules also follows the resignation of the head of the central bank, Raghuram Rajan. ...

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Samuelson points to the risks to the American economic growth from excessive health care costs. This is hurting take home pay and shows up in consumer spending. It is hurting government spending in other areas such as needed infrastructure spending and efforts to reduce the deficit. This hurts private capital investment to create jobs because of lower demand from constricted consumer spending. The U.S. budget has as its largest single expense 27% on health care compared to 20% on defense the next largest expense, with growth in health care spending taking this to one third of the budget in coming years. Without addressing health care, says Samuelson, the Supercommitte in Congress even if successful at deficit reduction will basically have failed to do its job, and it did not have the time, resources or conviction to do this. According to a new study from the Organization for Economic Cooperation and Development (OECD), U.S. healthcare spending per person is $7,960 per person in 2009. This compares with Norway $5,352, Britain $3,487, France $3, 978, an OECD average of $3,233. Life expectancy in the U.S. is 78.2 years, compared to Japan 83 years, OECD average of 79.5 years. Chile and the Czech Republic have life expectancy equal to the U.S. Except for cancer care where the five year survival rate is 89.3% in the U.S. and the OECD average is 83.5%, the U.S. lags far behind in much needed critical areas such as diabetes and asthma. Rates of emergency hospitalization for asthma are 3 times that in France and 6 times that in Germany and Italy. The U.S. has fewer doctors per thousand population and higher cost per medical procedure- with more frequent use of the costliest procedures- creating a supply shortage that induces higher prices, and less preventive and early action care through physician visits. The number of practicing U.S. doctors is 2.4 per thousand population in the U.S. compared to 3.1 per thousand for the OECD average; and number of annual doctor consultations 3.9 per capita in the U.S. versus 6.5 for the OECD average. Appendectomy cost $7,962 in the U.S., $5,004 in Canada and $2,943 in Germany. Coronary angioplasty cost $14,378 in the U.S., compared to $9,296 in Sweden, and $7,027 in France. Knee replacement cost $14,946 in the U.S., $12,424 in France, and $9,910 in Canada. Knee replacements, angioplasties and MRI exams are twice as common in the U.S. compared to the OECD countries. ...

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Pearlstein argues that the US and the Obama administration achieved most of its goals, even though the Europeans took the credit. On regulatory reform, Geithner's regulatory reform proposal he says, could well have been written at the French Finance Ministry, as at the US Treasury. And it gives Obama ammunition to prepare, as private equity, hedge funds, and banks try to water down his proposals for regulatory reform. By having member countries commit to adding $850 billion to the resources at the IMF, and regional development banks to provide help to countries in serious difficulties- and giving instructions that the money can be used not only for debt rollover, bank recapitalization and balance of payments support, but also for stimulus spending, infrastructure investment, trade finance and social support- the Obama adminstration has accomplished a great deal. It has succeeded in putting in place the necessary financial resources to support not only the financial systems of countries in Eastern Europe, Asia and Latin America that need help, but put emphasis on the need for resources to go for helping reduce job losses, create jobs, and provide some forms of income or support to people in these countries. This is a major step as it means the countries of Eastern Europe and other developing countries can deal with their crises in confidence. Mexico is taking loans from the IMF. Dominique Strauss Kahn had begun the policy of shifting IMF's focus to these social goals as significant parts of the recovery process in countries, but he faced the old mindset among the IMF staff, as when its reported staff wanted to increase interest rates in Pakistan by 10% instead of the 3% that was finally agreed to. That would have caused serious difficulty to the people of Pakistan, created chaotic situation and disturbed the social fabric of that country. See the link to this for S. Korea and for Pakistan. And as Gordon Brown put it the old conditionality that lay behind the IMF loans, is phased out. This makes it the new policy at the IMF backed by the G20 mandate. The Washington consensus which prescribed open borders, floating exchange rates and fiscal prudence is now ended. And to support this change the developing countries will have a bigger say in IMF policy and decisions. ...

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Because of anti Bush and anti american feeling every crank politicain or simply gangs fighting turf wars and even bandits or thieves can call themselves Taliban. Also the Wahabist religion of militants is not the religion in the Sind and Punjab 2 main provinces of Pakistan. And some of these areas like the Northwest frontier province and the areas bordering Afghanistan like Afghanistan itself have an independent streak and don't take well to any foreigner be it the Russians, the Pakistanis (Punjabis and Sindhis) and to the Americans or going back to the colonial era the British. Its convenient and a easy label for a lazy media that hasnt done its homework, and for politicians who lack the education and disposition to do their own homework or a cultural barrier that makes this difficult to call all this one label Taliban, or some other label, but its dangerous as the manner of dealing with this may be quite different given a correct understanding of whats happening. When turned over to the American people living in a modern world or to modern world Europeans for response to these labels there is only the gut instinct of them versus us the core feeling of something different and alien which is hostile. As this writer points out the Pakistani people themselves by and large are simply like people everywhere, may just be looking for better lives like the rest of us, and are not keen on the militants though they may carry anti Bush feelings. And the Pakistani people resentment for the USA not because of some innate or inherent hostility but because they feel left out of the modern world and its benefits of development like infrastructure, hospitals and basic services, just like most of the developing countries, which have alternated between hostility and friendship towards the USA, just as the USA has alternated between truly benevolent policy towards the developing world and policy thats more in tune to a prior colonial period of its partners in Europe like the British and the French. And in this sense the Pakistani people desire for economic progress may not be automatically construed as expressed through the politicians as they are corrupt and selfserving. Its a complex state of affairs sure but its not made easier but made more complicated by lazy man's labels without understanding the situation on the ground first hand and doing one's homework. ...

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Experts say this is the worst economic crisis since the Great Depression and it has gradually accelerated since October 2007 from a gradually unfolding housing crisis into a full blown credit markets crisis with the lack of transparency in mortgage securitization and the loss of confidence in the credit markets as mortgage securities values collapsed. The worst is still ahead as home prices have only fallen to a small extent so far and experts expect another 20% drop in prices this year and 2009. In the face of this crisis Immelt can be faulted for not using caution in his promises to the analyst community but to be so unforgiving for GE shares to fall 13% in one day and calls for breaking up the company or frustration at GE's inability to overcome what were clearly extremely unusual financial and real estate market conditions that may be a first in 40 years, is clearly overdone. Jack Welch who said he would be shocked beyond belief and shoot Immelt if he doesn't make what he promises now is also expressing some of that frustration, but beyond this is the inability to grasp the true extent of the situation in the markets that Welch never experienced first hand as he demanded and got his managers to deliver on results quarter after quarter or be fired for credibility problems ,because Welch's batting averages reflected a stretch of years where there were no crises of the magnitude of what Immelt is facing today. Upon further reflection Welch still stands by Immelt saying that this business about breaking up GE and Immelt's in trouble is crazy. And Immelt is building GE around the growth engines of the next big success stories in the growth engines of the future in Asia and the Middle East and emerging market countries of infrastructure, energy, aviation, health and environment, which would also be supported by the smaller but still significant growth of industrialized countries. And these things take time to put together a collection of winning businesses to be well positioned for future growth. Can GE accelerate sales or are there any shortcuts? Immelt doe not think so. Can he change things in a "severe and protracted" economic downturn as the Fed put it last month? Its beyond even large companies like GE....

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A joint article by Robert Rubin, Clinton era Treasury Secretary and Jared Bernstein of the Economic Policy Institute. Rubin was senior adviser to Citigroup during the period that Citigroup leveraged itself and invested in lower quality securities that have left the firm exposed to substanital losses, and led to hiring a new CEO Vikram Pandit to clean up the mess. And this may explain the joint article with a less well known economist Jared Bernstein, and the tentative nature of their advice as the two differ on the important issue of long term fiscal deficits and still agree on investing heavily in healthcare, education infrastructure, worker training and energy. In a short recession they may be complementary and you could have the best of both worlds as in the other postwar recessions. But this is unlike any of the postwar recessions and is shaping up to be a long and deep downturn unlike anything seen in the postwar period. That Rubin does not even mention this shows that probably he is out of touch, as he was during his years when Citigroup was acting much like the other banks that were in serious trouble this year. Some of the decisions for lax regulation during the Clinton years were taken with the support of Rubin and Greenspan. What Rubin calls the longest expansion could have been for the most part good fortune and a steady period for the economy with Rubin's contribution being fiscal discipline, stewardship of the Mexican rescue package and committment to free trade policies, but not facing upto huge headwinds in the economy that required challenging leadership and judgement. Here Rubin mentions nothing that suggests bold vision and judgement, instead hoping that old policies that worked during the good times would somehow work today. And on some issues like labor being squeezed and getting a smaller portion of the economic pie with no support for unionization, a drop in the number of unionized workers and weakened labor bargaining strength, Rubin who now sees this as a bad trend for the working middle class incomes, did little in his years in the Clinton administration to reverse or slow this trend. He cites productivity growth of 20% from 2000 to 2007, and yet the real income of working age middle class households was falling $2000 or 3%. ...

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WSJ's reporters Meichtry, L, Pokharel, and Soon look at the extraordinary rise of Gautam Adani through his efforts to develop reclaimed land at Mundra port in the state of Gujarat. Adani who started with a small family owned plastics maker in Ahmedabad developed Mundra port around 2001 with the help of the Modi administration. Modi saw the electricity shortages in Gujarat as an opportunity to tackle India's chronic electricity shortages. Adani's early development of a deep water port at Mundra offered both Modi and Adani the opportunity to tackle the electricity shortages by bringing coal in large ships to Mundra in the way that China was already doing by 2005 in its own efforts at industrialization. So deeply immersed was India under the Congress Raj of licenses and closed economy that India's established business failed to see what China was doing to break into the ranks of industrialized nations. India's first prime minister Nehru had build a command economy where not much happened without government licenses and approval often riddled unwittingly with corruption. Modi needed someone outside the established companies operating under the Congress Raj command economy and with a vision of an India with abundant electricity to take the risks Chinese companies were taking to build an entirely new economy. By 2005 Guangzhou was importing coal with large ships from Indonesia and Australia. State owned companies moved slowly and would take years to develop the port capacity. Using China's example Modi pushed ahead with Adani on a rapid time delivery making Mundra a Special economic Zone and helping to connect Indian Railways to the port of Mundra for coal deliveries. Adani Enterprises built the thermal power plants near Mundra and build electricity transmission lines on a rapid mission mode giving Gujarat abundant electricity supplies and giving Gujarat state in northwestern India a great leap forward in the way China was already doing right in front of everyone's eyes by 2005 with world class ports built at Guangzhou, Shanghai, Shenzen, Hong Kong and logistics connections set with the help of Maersk.  Maersk is now doing the same for modern logistics in India in collaboration with the Modi administration.  Modi and the younger generation of aspirational youth in India see a New India that can break into the ranks of the largest industrialized nations with world class infrastructure in the way China has done, and use new technologies with innovation that will speed up the process in a way that the world has never seen. A quick look at Mundra Port in Wikipedia shows the timeline, It starts in 1998 when Adani Port Ltd was setup and Mundra port work began, 2002 the port integrated with Indian Railways, 2003 when it was made a Special Economic Zone by the Modi government in Gujarat, 2007 when IPO of 40 million shares at price band of around Rs 400 was done.  The Biden administration and the Trump administration support India's efforts to build a new modern economy with a rapid shift to renewable energy. As India is building the ports and logistics with the help of Maersk and other companies in the European Union, president Biden is working with prime minister Modi to build a new supply chain that removes the overconcentration of manufacturing and supply chain logistics in China. This means new ports with the latest technologies in India to handle shipment to the US and the EU. Jake Sullivan set out the goals for president Biden to accomplish this task in meetings with his Indian counterpart Ajit Doval this week on iCERT. President Biden and Republicans, Germany and the EU, see India as a critical part of the Initiative on Critical and Emerging Technologies, and the new supply chain. For the Adani Group the IPO pause offers an opportunity to do what Nirmala Sitharman has done in the Indian Budget this week- build a stable growth path ahead for the long term in line with India's Amrit Kal the next 25 years to centenary of freedom in 2047. Nirmala Sitharaman set a goal of rapid capital spending and investment increasing capital spending in 2023 by 33% in 2023 over 2022, yet maintaining a stable fiscal path by keeping the deficit below 6%. ...

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This is an indepth article on Donald Trump's financial holdings, looking at the debt that Trump has built up in his real estate dealings, by Susanne Craig of the NYT. To get a detailed look of this the NYT inquiry into the holdings engaged RedVision Systems, a national property information firm to search publicly available data. Much of Trump's business is shrouded in mystery. But it is well known that Trump has used debt to build his business in a way that is not considered good practice in business, having led to three bankruptcies. Trump says he "is the king of debt." And "he loves debt." The recovery of real estate values during a rescue effort for the country's financial system also helped Trump tackle debt in a way that was not available to other entrepreneurs who suffered from the oil price collapse- one of them McClendon also used debt aggressively and his business collapsed leading to suicidal car crash. You can love excessive debt only if the government supports you with some sort of financial guarnatee misplaced, or you are lucky to get away with it- just ask McClendon. The irony is that the rescue of the financial system led to the low interest rates that hurt savings of the middle and working class, and the lack of help to Main Street in the home foreclosure crisis also hurt the same people disproportionately. The Obama administration policies in this regard rescued the very same business interests such as the New York real commercial estate symbolized by Trump, that are now appealing to those hurt as president Obama worked to let the financial system recover. The intention was never to support excessively overleveraged banks or overleveraged real estate built on debt, but in reality this is what happened. A nation cannot run its financial affairs in this manner of overleveraging to extract high profits that an investment bank such as Lehman or Goldman Sachs does, or a real estate company such as Trump's does- if regulators let them do this. Normally after the financial crisis of such dimensions that it shook the world economy in 2008-2009 leading to fears of a collapse as happened in the 1930's, the same faces would not still be there. But this is a strange period or a transition period where things are being sorted out, and the same faces Blankfein at Goldman Sachs and Trump in New York commercial real estate are with us.  And though the bashing of Goldman Sachs connection to Clinton is evident in the campaigns of Trump and Sanders, the bashing of Trump real estate and finance companies with its overleveraging and bankruptcies is evident in the campaign of Clinton against one posing as a representative of the working class. John Paulson who benefitted by shorting mortgage securities that caused the financial crisis of 2008 is on Trump's top economic advisory team, including the hedge funds and financial interests on Wall Street that Trump is saying support Clinton. No one, not the NYT or WSJ, can answer this, its just the paradox of today's situation. Hillary Clinton can say she has learned her lesson, with her Methodist upbringing and her own supporters such as Robert Reich and others, and break with the past especially as it in no way contributes to her success as president, not one bit. In fact rebuilding the middle class and infrastructure require entirely different connections and views on life, a different imagination.  Trump has billions of dollars and a real estate business that is so complex that even the NYT and property information firms can only say that in the end it is shrouded in mystery. Companies owned by Trump says the NYT from this inquiry have debt of $650 million. Other Trump business activities through 3 passive partnerships owe an additional $2 billion. It is a lot easier for Hillary Clinton to put the speech fees behind her as they have little to do with what she is as a Methodist and a proponent of improving women's lives, than it is for Donald Trump- for whom his business is everything that he is including his art of the deal- to reject who he is. ...

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The Obama administration's $38.6 billon loan program using Stimulus funds was intended to create 65,000 jobs. Two years into this program, with half the money disbursed, the program has created a mere 3,545 new permanent jobs according to Energy Department figures. The Energy Department claims its $5.9 billion loan guarantees to Ford Motor Company to produce energy efficient vehicles by upgrading plants in 5 states saved 33,000 jobs. Brookings Institution analyst, Mark Muro, says the administration appears to be counting all the workers at these plants and not the jobs saved. 33,000 is close to half the Ford hourly and salaried U.S. employees. Harvard Business School professor, Josh Lerner, says there is a tendency to do a lot of fuzzy math in these figures. Muro points to the need to set large expectations for short term political calculations. The Energy Department's own figures show 20 "green tech"companies won loans so far under this project by negotiating with the Energy Department. If these companies hire the people they agreed to they would hire 8,050 new permanent workers. Only 10 of these companies have created or saved jobs so far. Of the other 10 some won loan approval only recently. The whole process is time consuming. Even if the Energy Department were to create the 60,000 jobs under the revised estimate, each job saved or created would come at a cost of 640,000 dollars in loan guarantees. Using the figure of $19.3 billion disbursed 2 years into this program (half of the $38.6 billion) and 8,050 jobs created, would give a cost of $2.4 million in loan guarantees for each job created- an astoundingly high figure. Other factors to consider are the additional jobs created downstream by suppliers to these companies as the administration states, and the cost of loans if as in the case of Solyndra a company goes bankrupt. Solyndra received a loan of over $500 million and represents 3% of loan guarantees. The administration and Congress assumed a failure rate of 5-10% for this program. ...