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This report in NYT looks at the Barbados debt crisis. Barbados spends 55% of its budget to pay interest on debt (servicing the debt). That leaves about 5% for health and climate change. Years of borrowing that ignored basic rules of financing have created serious problems that were compounded by the pandemic and hurricanes. This report shows that the total deb of Barbados was not known to the central bank. Borrowing was approved at exorbitant interest rates. One loan with Credit Suisse for $150 million is shown here with interest rates that lead it to become a catastrophic amount owed. Many such loans without any checks and supervision of total loans taken, lack of financial prudence rules followed, lack of transparency and alerts on borrowing and spending tend to create this kind of situation in many poor countries. About two thirds of developing countries are in this situation owing one third of their budget for debt service or paying interest on the loan. The situation is unstable to begin with. Then on comes along a hurricane or natural disaster such as the pandemic and the unstable situation becomes a catastrophe. Sri Lanka, Pakistan, the Caribbean nations, nations in Africa, face debt crises that are getting worse. It is not inevitable or destiny for nations today, consider the examples of large nations such as Japan, China, South Korea and India, Malaysia, Indonesia, and one can see that development finance can be prudent and responsible, so that situations such as the pandemic can be handled without going into disarray. ...

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The BBC looks at burnout for service workers in the US and Europe leading to the great resignation. Most service workers are quitting their jobs as the level of burnout has increased in the last few months compared to the early days of the pandemic in 2020. One owner of a restaurant in Britain says she closed it not because there were not enough customers, not because it was losing money. She closed it because workers were not showing up for work. She says whether they say it or not workers at her restaurant were experiencing a lot of anxiety. This meant her carrying a heavy load till she decided it was better to close  when she was on top than be carried out on a stretcher. Another manager of a variety store in South Carolina says after working 60-70 hours a week for months the only way he could get a day off was to ask another manager to do a 16 hour shift. Long work days in the US, low pay, and disrespect for their work, was common for service workers in the US. They now face verbal abuse of customers feeling the accumulated stress of the pandemic and taking it out on service workers. Higher wages are not inducing workers to come back. Service workers are choosing to retrain for other careers with better pay, better hours, or going back to study. ...

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This report in WSJ takes a detailed look at how the shift to digital payments, and digital badges for covid free designation on smartphones are affecting a part of the population of 60+ years that is notinternet or smartphone savy.  60+ years make up only 10% of the users of internet on age based graph, even though they are a large part of China's rapidly aging population, estimated to be closer to 20% of the population or about 250 million. Elderly people in China are having a hard time with scanning of health codes to access transport and other services. To tackle the covid pandemic China has health codes assigned to citizens which link user national ID and Covid status. These need to be scanned in for access to train and transport facilities and other services, color coded digital badges on smartphones that show one is covid free.  Most elderly cannot handle these smartphone tasks because they lack the skills of young people with smartphones or lack the digital payments having used cash all their life. Other problems are poor eyesight, health problems, but the most severe is a big skills handicap in downloading apps, in typing quickly, and in navigating the internet. The government is taking steps to provide relief for the elderly by prohibiting places of services from refusing to accept cash, and finding ways to make the health codes system work for seniors. ...

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Americans Save Early and set aside for savings 10% of your pre-tax income, is the advice to ensure a safe and healthy savings retirement. This is absolutely critical. What the government can do is to ensure that incomes keep uo with inflation with fair wages in industry. It also can and should protect Americans from unexpected medical costs by ensuring that all Americans are covered by health care and for catastrophic situations. Then it is the task of Americans to build a culture of careful saving that their ancestors had and considered a essential part of virtue. For this to help build savings for retirement the government and the Federal Reserve together- as Biden and Powell have shown one with capital investments to build a strong economy and the other by protecting savings and cost of living action- must ensure that no financial crises take interest rates to zero or 1-2%. At interest rates of 5-6% for returns this helps build savings for retirement. For this to happen banks have to go back to their traditional work in the economy and no speculation risk, and Silicon Valley go back to inventing and not a culture of capturing capital allocation in capital markets and paying little in taxes. A new culture would put government in its right place to ensure that it plays a significant role in building manufacturing and science and technology in the US as president Biden has done through government investing in infrastructure and renewable energy, chips and science, and in education, healthcare.  ...

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Amazing pictures in black and white from another era of the 1950's and 1960's of Indian prime minister Jawaharlal Nehru.  Including a picture of Nehru and Sarvapalli Radhakrishnan the president of India, in cricket caps and holding bats in a cricket match at the National Stadium. Some from the Indian Express archives that you may never have seen before. Taking a walk in the mountains with Edwina Mountbatten of Britain, and holding the Dalai Lama's hand closely as he walks with him. Nehru is remembered for his leadership of post colonial India in 1947 with Sardar Vallabhbhai Patel as deputy prime minister, for his work at the Constituent Assembly drafting India's Constitution, and taking India through its first 15 years and building India's democratic structures through linguistic state creation and border conflicts. His work with leaders like Vallabh Pant, Mohandas Gandhi, Sardar Patel, Sarojini Naidu, Subhash Bose and others in the 1930's laid the ground for the first home rule assemblies under the British and made it possible for India to gain the experience needed to sustain democratic institutions for its first 100 years which come up in 2047. ...

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The Big Beautiful Tax and Spending Bill in the US Congress faces close votes in the US Senate with Senators Rand Paul of Kentucky, and Thom Tillis of North Carolina, both Republicans against it.  The Senate version has additional cuts to Medicaid funding. Tillis expressed concern about these cuts. Senator Rand Paul is opposed to increasing the deficit for enlarged spending and tax cuts. Republicans and DJT have close votes in the Senate and in the Congress. Republicans Murkowski of Alaska and Curtis of Utah want to change the early phaseouts of tax credits to the renewable energy industry in the Senate bill, and the excise tax after 2027 to avoid buying from China and develop American manufacturing in renewables. Senator Collins of Maine has an amendment to add $25 billion for rural healthcare and rural hospitals to offset the effects of large Medicaid cuts. Collins plan also lets taxes revert to 39.6% from 37% for married couples incomes over $50 million.  The bill then heads back to the House for changes by Wednesday, July 2, for a goal to have it on the president's desk by July 4th, Friday. ...

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Lack of vaccine supplies and differences between the European Union Commission in Brussels and the German, French governments is slowing the vaccination drive in both countries. The lack of a national concerted effort with the whole country, local and federal governments in agreement, is restricting the effectiveness of the vaccination drives. The failure to contract for more vaccine supplies adds to the problems. By contrast India has coordinated its drive for vaccinations, with the local and federal governments in agreement, and the whole population largely behind the effort to vaccinate. Very critical for a population of 1.4 billion when one includes Bangladesh which has received 2 million doses of vaccine. India has gone one step further with supplying of vaccines to Brazil, Morocco, and other countries. BBC says India has exported 60 million vaccine doses to 76 countries. This is an amazing story and much credit goes to the concerted government effort at all levels local, state and federal and public support. Germany and France can gain by looking at the Indian experience in vaccination drives, just as India has gained by looking at the vaccination drive in the UK, Israel and the US. ...

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Already lead US negotiator and ambassador to Ukraine Lt. Gen. Keith Kellogg has created a miscomprehension on the US and European side as to who will participate in negotiations. Lack of experience in tough negotiations to end a conflict is showing as it must be evident that Ukraine and the European Council, the EU, would expect to be part of any negotiations that settle questions about the security of Europe and what kind of Europe emerges from the negotiations. The European problem comes from the European lack of resolve to set aside or settle internal divisive issues such as migration, privatization, globalization winners and losers, rural vs urban, that have created economic and political divisions in Europe to concentrate with unity on issues that have common interest. Bad policy as in the US from business and government to overconcentrate manufacturing in China, in Germany to overconcentrate energy supplies from one provider, are sources of the conflict and have taken years to fix alongside the pandemic. European leaders scramble to define their position after statements by US Defense minister Hegseth and US's Ukraine ambassador Kellogg that suggested direct talks US with Russia would leave out the EU and Ukraine. Hegseth stepped back from some comments. Marco Rubio, US Foreign Minister, says Ukraine will be at the negotiating table in talks the US holds with Russia. Macron meets with Scholz, EU's Tusk, and NATO's Rutte this week.  Ambassador Kellogg and lead negotiator had said to European leaders about their being at the negotiating table-  “I think that’s not going to happen.” The EU Council head Costa after meetings with European leaders says Europe's position is-“In a nutshell: There will be no credible and successful negotiations, no lasting peace, without Ukraine and without the European Union.” Further he said-  “It must guarantee that Russia will no longer be a threat to Ukraine, to Europe, to its neighbors,” he said. ...

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Lego A/S CEO, Jorgen Vig Knudstrop, talks to the WSJ's Jens Hansegard. Lego is based in a small town in central Denmark. Lego's sales revenue has tripled since 2007, and net profit increased by 35% to about $1 billion for 2012. The building block segment in the toy business is growing rapidly with growth of about 20% in the last year. The overall global toy business is stagnant, with declining prices, difficult economic conditions and competition from the consumer electronics products. Lego is not affected by this because it is able to price products for sets of bricks and figures at a premium, and stays ahead by coming up with innovative products. Lego has 85% share of the U.S. building-block market. Lego is a family owned company started in 1947 which faced difficulty in 2004 with a fall in sales. Under Knudstrop's direction it has recovered and shown strong sales growth, especially in the U.S. with 26% growth in 2012. His approach was to focus on nostalgia themes, Hollywood themes, and come up with innovative products for girls. This includes the Lego City, Lego Star Wars, Lego Friends themes. Lego invests heavily on R&D and plants. About 60% of revenue in 2012 was from launches of new products. The new Lego Friends theme for girls tripled sales to girls, creating a remarkable sales opportunity. Knudstrop's philosophy is to remain humble and aggressvely pursue new opportunities....

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The new faces in the Biden administration on economic policy are Janet Yellen, as head of the central bank, the Federal Reserve, and Cecilia Rouse, a Princeton labor economist, as head of the Council of Economic Advisors. In this report WSJ looks at the economic policies of the new administration after Mr. Trump rejected globalization and international trade agreements that were not in America's interest or that hurt American workers.  Informal conversations with experts suggest WSJ says, that globalization is now suspect as a way that benefitted China and other countries including Germany, and hurt the U.S. France, Britain and other countries in Europe that were not strong exporters. This hurt their industries which were eroded by imports resulting in the three decades long destruction of communities across these countries that depended on manufacturing. It has also hurt countries like India that let their markets be dominated by Chinese imports, with a reversal of policy in 2020 with self reliant economy under "Atman Nirbhar" policy as the new goal. Mr. Trump's tactic in this trade war was to fight back to regain America's position in manufacturing with tariffs on imports. The trade deficit had to come down with China just as it had done with Japan decades earlier. This was starting to happen. One problem in bringing down the imports was the increase in the value of the dollar, as Janet Yellen has noted. The new policies will look at what the effective policy will be while keeping this goal in mind.  Both Yellen and Ms. Rouse have spent years studying labor markets and Ms. Rouse is quoted here as saying: " With open trade there are winners and losers. The losers are really losing, and we need to take care of them and take on more nuanced models of international trade as a result." Other experts from the earlier Democratic administrations such as Prof. Frankel at Harvard say that there needs to be increased focus on American workers left behind by trade, technology and unequal education, with more spending on preschool, infrastructure and health. All this suggests that there will be a continuation of U.S. policy in challenging Chinese use of globalization to advance its interests, chastening Americans on the use of the very word globalization which can mean different things to different people based on how they can gain advantage. The word may even be entirely dropped in favor of what the policies are and what they do for the American worker, American communities including small towns, and the American people, spelling each of these out every time supply chains and the global economy is mentioned. The new administration will get an opportunity to show that it too can come up with new ideas and action plan to strengthen American manufacturing and jobs. It will also have to show substantial results as people have lost patience with Democrats and Republicans on the lack of progress in rebuilding America's leadership role in the world economy, and in defending American workers and factories. Clinton, Obama and Bush all offered false promises on trade with China ignoring the damage this had done to American leadership in the world economy. Clinton with support for China's entry into the World Trade Organization, Bush with foreign wars and costly diversions and regulatory failures with banks that led to the 2009 deep recession hurting Americans, and Obama with the lack of will and interest in America's leadership role in the world as the dominant nation in manufacturing,   ...

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Production declines by a steep 80% in the first half of 2014 in Venezuela's auto industry. Ford, GM and Toyota cut production and leave facilities idle with a lack of parts supplies and other problems.

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A year long study by the Washington Post of all shootings by the the police in incidents of law enforcement in the U.S. shows only about 4% of the incidents involve police killing unarmed black persons. Yet a disproprotionate number of unarmed men shot are black or Hispanic- 3 of 5 people. The large majority of incidents involved people who were mentally troubled most of whom carried a weapon, persons carrying a weapon, or persons running from the police when asked to stop. The WP has compiled every police shooting in its database for analysis, something even the FBI does not have and is only now starting to put together. For police the hard part is when to know a certain behaviour such as reaching into the pocket after a police chase was harmless or risking the officer's life, as shown in a video carried by officer Lisa Mearkle in Hummelstown, Pennsylvania, for one of the shootings. Mearkle was acquitted by the jury.

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A large blackout leaves Venezuela's capital Caracas and parts of the country in complete darkness. The blackout was the result of problems at the El Guri hydroelectric dam in eastern Venezuela. Venezuela's power grid has deteriorated rapidly from lack of investment, corruption leading to siphoning off of funds for investment in new turbines and technology, and mismanagement with the power company run by people with little experience in power generation. Initially Electricidad de Caracas was  bought by AES Corporation in the U.S. in 2000, then nationalized by president Hugo Chavez in 2007. The lack of investment is also a result of policies that subsidize power making it practically free, just as in the case of gasoline. 70% of Venezuela's electricity comes from El Guri hydroelectric dam. Hyper inflation estimated at an astounding 1 million percent is ruining Venezuela's economy leading to 3 million refugees into neighboring Colombia and other countries. ...

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Reports of ATM's running out of cash in India in 8 states. The government says this is a result of a spurt in demand and will ease in a few days. The government's policies are to increase the number of debit card and digital transactions to shift more of the transactions in an underground economy into the formal economy so that tax revenues to fund infrastructure can be generated. As a result fewer currency notes of Rs. 2000 or about $30 are being printed. This is aggravated by black market hoarders of 2000 rupee notes. Public confidence in the banks was shaken by some high profile scandals leading to people keeping extra cash at home increasing the demand. The government plans a bailout of $32 billion for bad loans at banks.

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Sara Ehrman describes the time when Hillary Clinton worked in Washington D.C. as a 26 year old lawyer working on the Watergate committee, and Bill Clinton was teaching law in Arkansas. In August 1974 Hillary was living for about 1 year with Mrs. Ehrman, a friend who was a congressional aide at the time. She is 97 today, and recalls that time when she tried to discourage Hillary from going to Arkansas to join her boyfriend. Ehrman felt not much would come out of Bill Clinton, though she thought him to be handsome, and later worked in his presidential campaign and Hillary's presidential campaign. Ehrman was 55 then, and describes Hillary Clinton as a bit sloppy in her habits, such as not making her bed and having a lot of stuff strewn about her room, but really intelligent and very hardworking. At the time both lived together. Ehrman describes a daily routine of seeing Hillary go to work with coffee in the morning and come back exhausted late at night, having yogurt and going to bed, day after day.  The two met for the first time in 1972 when Ehrman was co-director of issues and research in the McGovern campaign in Texas, and Hillary was helping with voter registration. This report describes in detail the road trip to Arkansas that the two made together, when Mrs. Ehrman drove Hillary to Arkansas in her old Buick. They stopped at small towns  in the 1200 mile journey, and this journey ends with Mrs Ehrman crying that she could not get Hillary to change her mind about Bill Clinton and Arkansas. About what she thought was a bright woman throwing her life away in the deep South of the seventies. Hillary she remembers insisted she loved Bill Clinton, and having passed the Arkansas Bar exam had firmly decided on settling in Arkansas. ...

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Out of the rubble of failed policies, lack of far sighted leadership, and the failure of Middle Eastern elites and leaders, must arise the right way forward.

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The other title of this article in the NYT was "California's fading Political Machines and volatile race for Governor." Gone are the days when Pat Brown was able to put his son Jerry Brown in the race for governor, there are 9 persons running for governor of California in 2026. The current governor Gavin Newsom is said to be promoting his book in Nashville, Tennessee, where many Californians are moving with the inflated cost of housing in the state. Gavin Newsom's grand father gave a $5000 check to Pat Brown in 1943 to run for District Attorney, this report says citing the book. From that time Pat Brown became Attorney General and then governor of California in 1958, defeating Richard Nixon in 1962. In 1962 Pat Brown seemed vulnerable as his signature accomplishment setting up the UC system of college campuses and the water reservoir, tax increases to pay for this, were in their beginning stages and their lasting value not recognized at the time. Nixon from Whittier, California, was a former Vice President and was seen as likely winner. This toughly fought election created the Pat Brown myth and so called machine that helped his son Jerry Brown to two terms as governor 1975 to 1983, and again after serving as Mayor of Oakland and Attorney General to come back to governors race again in 2011 (because term limits came after 2011) and be governor again 2011-2018. Another way of looking at it is that in his last two terms it was also Jerry Brown's careful balancing of the budget and finances of the state, his environmental support, that made him a reliable figure for the public interest not just the political machine backing him.  California to be sure has had popular governors on both sides Reagan won in 1966 as governor of California to succeed Pat Brown. The Kennedys and Pat Brown are matched by the Reagan supporters in the state. In today's situation where China's dominance in industry and manufacturing has affected all parts of deindustrialized America, California is no exception, where much of the middle class has seen their savings eroded, the issues are different and the challenges are different. ...

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The Ukraine war is heading in the direction of a wider war, says Antonio Guterres, secretary general of the United Nations. "I fear that the world is not sleepwalking into a wider war, it is doing so with its eyes wide open." On the lack of strategic vision and near term thinking focused on gaining that slight advantage in the near term, and the actions of global finance, he said it was deeply irresponsible and immoral. He says a "radical transformation" is needed, as without it one side will pile up wealth and the other left on the wayside with crumbs. 

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Michelle Yeoh, Ocar winner, describes her role in promoting the UN Sustainability Goals, the millions of women who are part of the 2.7 billion people she says lack digital connectivity around the world, and face barriers to information and resources in all spheres of their lives. She wants to put the spotlight on the women who are on the frontlines of crisis- who are rebuilding their communities, taking care of children and older people, and putting food on the table. Yeoh says she is 60 and she know what perseverance means, but nothing compares to what these women are doing today.

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Trade Agreement talks will begin in December between India and Sri Lanka as Sri Lanka looks for ways to bring back growth following a 9.2% contraction in the economy in 2022 and estimated 4.2% in 2023. Mr. Weerasinghe at the International Trade Office setup under the presidential secretariat will represent Sri Lanka. Engaging in trade with India and China and regional countries is part of the plan to restore growth. Sri Lanka's exports to India were about $980 million in 2021 and imports $4.74 billion. This time Weerasinghe says we must avoid taking rigid inflexible positions and strive for a win-win for both sides.

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By failing to show a grasp of the problems of rural poverty and lack of upward mobility, of health and education, in the rural parts of the US, Paul Krugman ignores the spirit that for so long kept the lights on for rural America in the time of FDR and Truman. The NYT's Thomas Edsall has done a great service to America by showing where the Democratic party under Clinton and Obama lost the spirit of FDR and Truman of standing by the common man, of "The People, Yes" that Carl Sandburg wrote so eloquently about not so long ago.

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WSJ's Alistair MacDonald talks to farmers in the Chernihiv region north of Kviv which was overrun by Russian troops early in the war before withdrawing. Herd farmers brave mines and continue to farm in difficult conditions. Many have borrowed heavily for next years harvest. Many farmers have damaged equipment and craters from bombing in the fields. About $4.3 billion in damage happened in the early days of the war. 

Farming is the occupation of 14% of the population. It brings in 40% of the $68 billion in Ukraine exports each year making it important to get farming back as early as possible. 

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Tom Wheeldon in FR24 describes the importance of cultural issues such as women wearing headscarves in Turkish elections that are important in the Anatolian heartland away from Istanbul. Kilicdaroglu is handling this issue by supporting the right of women to wear headscarves. This puts more focus on the issue of inflation at over 50%, a cost of living crisis, and the handling of the earthquake, as Erdogan looks for a repeat of his previous election wins. If elected Kilicdaroglu will take Turkey back to a parliamentary system and rule by a civil servant who is modest and plans to serve for only one term. 

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The Paris lockdown is unique and effective because people are required to carry a signed document showing where they are going and show it to police when going outside the home. About 100,000 police and gendarmes are enforcing the lockdown in France. The lockdowns in the U.S and some other countries lack this kind of enforcement. France implemented the lockdown March 16, after Italy acted late on March 10 with the virus already spreading there. Once this was done the lockdown was done with tight restrictions and enforcement by police unlike other places. In Asia India has imposed a strict lockdown.

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The US dollar is only 5% way from reaching parity with the euro. The euro was at $1.03 during the beginning of May. It is at $1.05 on May 21. With the US central bank raising rates, and the effects of energy shortages on the European economy, parity looks likely says this report in WSJ. Additionally weakening demand from China for European goods or the EU shifting its supply chains back to home countries and trading less with China could also have an impact from the ripple effects of China's support for the Russian position on Ukraine.