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Laurence Kotlikoff is a Boston University economist who calls the Obama administration's plans for fixing the financial system akin to "putting a Band-Aid on cancer." He outlines his own proposal in a book just out with the title: Jimmy Stewart is Dead. It calls for taking the risk out of the nation's financial system with "too-big-to-fail" banks, which threaten America's financial system, and may cost huge amounts of taxpayer money approaching by one estimate the entire unfunded liabilities of the Social Security System. He writes in the book that "the problem is the leveraging of the taxpayer by people with no formal training in finance or economics, no personal downside, an assortment of Napoleonic complexes, the money to buy ratings in New York and policy in Washington, and the ability to run circles around regulators." His proposal is to turn banks - intermediaries taking deposits and making loans- into institutions that connect borrowers and depositors with very safe mutual funds created for this reason. Each deposit would be pooled with other deposits in the new kind of mutual fund with all the money held in cash. These mutual funds would supply loans. This strips banks of their risk-taking function. It has attracted attention and support of Columbia University's Jeffrey Sachs and University of Chicago's Nobel Prize winning economist Robert Lucas. Most recently Bank of England's Governor mentioned Kotlikoff three times in a speech to Parliament as ideas worth looking at. With bankssstripped of risk-taking only one single Federal Financial Authority as the national regulator would be needed, instead of the myriad regulators in the current system that have failed in crises. MIT's Simon Johnson agrees that some strong action is needed and compares the need for action with what Theodore Roosevelt had to do to break up the once impregnable Standard Oil. By 1911 the Supreme Court had broken up Standard Oil into 34 companies....

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The feud between New Jersey Governor, Chris Christie, and the head of the state teacher's union, Ms. Keshishian. Governor Christie called the state legislature into an emergency session and pushed through a 2% cap on annual increases in property taxes, which have risen 70% over the last decade in New Jersey. The issue is whether the extent of spending on education is sustainable in New Jersey. New Jersey's median property tax is the highest in the nation, at $6,579. By comparison New York is $3,755 and Illinois $3,507. New Jersey residents pay an average of 11.8% for property taxes. Both sides have engaged in strong rhetoric and the teachers union has attacked the Governor in television ads. Governor Christie refused to discuss issues with Keshishian, and ended a meeting in his office, with "Not with you. I don't." The teachers argues that New Jersey schools provides some of the best schooling in the nation- the state's high school graduation is 82%, and it ranks among the top 5 states in key subject areas, according to the Education Law Center in Newark. Its graduation center for black males is 69%. New Jersey also has a heavily unionized public sector with relatively high wages for public workers of all kinds, including teachers. This and a state supreme court decision mandating increased funding for schools in poor communities raises the cost per pupil to $17,794, the highest in the nation, after Washington D.C. New York is at $16,981. California, and Illinois spend $11,000. The average New Jersey teacher makes $61,277 a year, well above the U.S. average of $52,800, according to the National Education Association. Medical and other benefits add $19,140 according to the teacher's union. And the unsustainability goes back to issues such as unfunded liabilities for benefits and pensions in New Jersey. New Jersey's Treasurer estimates the unfunded liabilities relating to lifetime health benefits for current and retired teachers at $36.32 billion....

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Residents of Detroit- almost all residents- in the three county metropolitan area see their economy in ruins, according to aWashington Post-Kaiser Foundation-Harvard University poll of Detroiters. At the same time 63% of Detroiters feel optimistic that things will change for the better. Detroit's dependence on the auto industry has led to a marked precipitous decline with the highest unemployment in the country. Michigan has 14.7% unemployment and Detroit has 16.7%, the highest in the country. Seven of ten residents see a revitalization of the auto industry needed to rejuvenate Detroit, and three fourths of residents polled say this is likely to happen, even though the state government is looking to diversify the economy. A senior economist at the Upjohn Institute, an independent research group in Kalamazoo, Michigan, says creating a new diversified economy which includes biotech, medical, green energy in addition to electric cars and other fields in auto, will take years. One, two or even five years won't be enough to replace all the jobs lost in the auto industry, it may take adecade or longer. Some workers will be retrained in new areas, others will move and some will take lower wages at new jobs. Because of the area divided along racial lines with the black city neighborhoods and the white suburbs, the pain while distributed throughout the region, is seeing a marked deterioration in the life in the city. Governor Granholm says the state governmet has spent $400 million to help enroll 100,000 people in retraiing programs to become nurses, medical technicians, truck drivers and welders. Granholm says her office has helped create 163,000 jobs in 2009....

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Roland Arnall who sold his Long Beach Mortgage Company to Washinton Mutual which became WaMu's subprime arm, and ran his own mortgage company Ameriquest. He helped start the whole subprime business when in the early 1990's his company Long Beach Savings and Loan began selling subprime mortgages to financial instituions on Wall Street, where the mortgages were packaged into securities and sold to investors. This packging of securites backed by mortgages and later the shopping for ratings which enabled these securites to get the the AAA rated seal of approval was to get this business the financing and backing on Wall Street. Ameriquest was invoved in questionable practices in its lending. His company and its 270 offices closed in 2006 and $325 million was put up by his holding company ACC Capital Holdings to settle regulators claims of charging excessively high mortgage rates. His origins are with a family that survived the Holocaust by taking refuge in a Catholic church and he became an altar boy, and later immigrating to the Los Angeles area. He was diagnosed with late stage cancer in March 2007 and died the same month. This is one of the individuals who pioneered the whole business of packaging subprime mortgages as securities. ...

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Negotiations between European leaders, especially Germany's Merkel and the Obama administration on climate change at G8 meeting. The U.S. and Europe try to work out differences. The U.S. is vague about some language such as the starting year against which emissions reductions will be measured, and has resisted the European pressure to set strong goals over the next 10 years. Europe wants 1990, while the USA, Australia and Japan prefer 2005. Europe wants to see language in aformal document that is being developed for the G-8 meeting, which also includes developing countries, for limiting the rise in global temperatures to 2 degrees celsius, or 3.6 degrees Fahrenheit, above pre-industrial levels.

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As the related article in The Washington Post points out the narrative inside India relates more to the the sense that terrorism has been a persistent problem for India and the public's sense that action was needed. Most of the issues in South Asia relate to development, roads, dams, bridges, airports and housing that need to be built, healthcare, sanitation and education on a massive scale. This is an area where India can show the way forward for South Asia, and be the real test for Mr. Modi after the many projects that he has initiated in India in the first term. It is only ordinary Indians, Pakistanis, Bangladeshis, Sri Lankans, and other people in South Asia that are paying the price for neglect of development and infrastructure as China, South Korea and other nations have forged ahead. A focus on development is the right sphere for competition both for Mr. Modi and for people in the region.

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Three central bankers at the Bank for International Settlements (BIS) advise caution in the exercize of easy money policies. BIS head, Jaime Caruana, former ECB head, Jean-Claude Trichet, and Bank of Japan governor, Masaaki Shirakawa, say prudent steps are needed to ensure that easy money policies give time that is wisely used by financial institutions to improve their balance sheets, and not wasted. This includes improving reserve capital levels, avoiding undue risktaking. Jaime Caruana warned that easy money policies posed the risk that firms could avoid recognizing losses and lead to a new wave of risk taking, resulting in wasting the time that was provided by the central banks to address pressing problems on the balance sheet. The BIS in Basel, Switzerland, was a prominent voice in warning of the dangers of excessive risktaking in the global financial system before the 2008 financial crisis.

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 This message from Pope Francis is especially relevant today during coronavirus. Francis says of the mistaken priorities of today away from healthcare, education, infrastructure and "coherence" in society and the pain and hardship this is causing in society, there is much that can give people thought to reflect on. Francis  new book, "Let us Dream: The Path To a Better Future" will be out December 1. "If we are to come out of this crisis less selfish than when we went in, we have to let ourselves be touched by others’ pain." He cites a line in Friedrich Hölderlin’s “Hyperion” that speaks to him, about how the danger that threatens in a crisis is never total; there’s always a way out, that where the danger is, also God plants the saving power, a way out. And not simply a way out, God also gives human beings a chance to grasp for and hold onto renewal if only one makes the endeavour. As it says in the Bhagavad Gita God gives man a chance to warm himself near the fire, only those who make the effort to go to the fire can feel the warmth, it is a choice man has to make. And again God says in the Bhagavad Gita that he is not partial to any man. Ever since the global financial crisis hurt working families in the middle and lower classes hard in 2009 because of banks misbehaviour and greed, Pope Francis has called for countries in the western world to heed his warnings about the dangers of greed and corruption to us all. Even George Washington warned of this in his inaugural address, so the warnings are not new. Reminding people once again he says "we cannot return to the false securities of the political and economic systems we had before the pandemic. We need economies that give to all access to the fruits of creation, to the basic needs of life: to land, lodging and labor. We need a politics that can integrate and dialogue with the poor, the excluded and the vulnerable, that gives people a say in the decisions that affect their lives. We need to slow down, take stock and design better ways of living together on this earth." The pandemic has exposed the paradox that while we are more connected, we are also more divided. Francis is never tired of warning that the present political and economic structures and people who staff them have not felt others pain, so he reminds us it is hard to build a culture of encounter in which we meet as people with a shared dignity, within a throwaway culture that regards the well-being of the elderly, the unemployed, the disabled and the unborn as peripheral to our own well-being. Where only self preservation counts. Francis reminds us of the Christian concept that no one is saved alone. This is not just an abstract concept. When Francis was only 18 years and a second year student he was admitted to a Buenos Aires hospital for a severe respiratory disease, so severe that he lost a part of his lungs. He remembers the day August 13, 1957. He understands this pandemic from personal experience. He knows what it is like to be on a ventilator. Surgeons removed the upper right lobe of his lung. Francis struggled to breathe. He was  saved Francis says not even by the doctors, but by a Dominican sister, a senior ward matron, who had been a teacher in Athens before being sent to Buenos Aires. She understood that Francis was dying and after the doctors left asked the nurse to double the prescription dose of penicillin and streptomycin. Sister Cornelia Caraglio, knew better than the doctors from her regular contacts with sick people what they needed, and she had the courage to act on that knowledge.      ...

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President Obama told a press conference after the Supreme Court hearings on the healthcare law: "For years, what we've heard is the biggest problem on the bench was judicial activism or the lack of judicial restraint, that an unelected group of people would somehow overturn a duly constituted and passed law." In doing so Obama was framing the argument he might use should the Court rule against the law, putting the Supreme Court in the role of villain placing its judgement ahead of elected representatives, as the U.S. moves into the presidential election in November 2012.

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U.S. president Obama repeatedly compared the Iran nuclear deal vote in Congress to the 2002 vote to authorize the war in Iraq under president George W. Bush, in a speech at American University. President John Kennedy made a speech on a strategy for peace at American University in Washington D.C. on June 10, 1963, offering negotiations as away to a comprehensive nuclear test ban treaty with the Soviet Union. Obama said the "choice we face is ultimately between diplomacy or some form of war." The nuclear deal faces bipartisan opposition in Congress on grounds of weak verification, doubts about Iran's intentions, lifting of a weapons embargo including ballistic missiles, and lifting of economic sanctions with snapback seen as unrealistic, and support limited to Democrats in Congress. Compared to the speech by Kennedy which was hopeful- " in the final analysis, our most common link is that we all inhabit this same planet. We all breathe the same air. We all cherish our children's future's. And we are all mortal." It was also a response to Soviet Union's head Nikita Krushchev's letter to Kennedy of Dec. 1962 following the Cuban missile crisis in October 1962, saying "the time has come now to put an end once and for all to all nuclear tests." Compared to the enthusiasm with which the Kennedy speech was received, the Obama speech brought up the divisions of the wars in Afghanistan and Iran, in which many Democrats including Senator Hillary Clinton voted to support the Iraq war, and missed the power of president Kennedy's (and Krushchev's) words of 1962. The last minute inclusion of a lifting of an arms embargo including ballistic missiles," created doubts about Iran's intentions in the U.S. Congress, unlike Kruschev and Kennedy's decisive response on the nuclear issue which led to the Nuclear Test Ban Treaty. The condition agreed to that the Iran nuclear deal of July could pass with only one third of Congess supporting it- based on a presidential veto if Congress did not approve it with a two thirds majority- created the prospect of the U.S. moving ahead on a major foreign policy issue with only limited support....

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This report in the Hindusthan Times on president Trump's 25% steel tariff on steel imports focuses on the trade deficit with China of $375 billion in 2017. It shows the trade deficit for the month of February 2018 citing data from China as growing rapidly in 2018 over the prior year by 45%, even as imports went up only by 6.3%. In looking at coverage in the U.S. on this topic many of the reports in the Washington Post and the New York Times were critical of the tariff without mentioning the size of the trade surplus of China. Hardly any reports mentioned the growth by 45% in the February 2018 trade surplus of China with the U.S. over the prior year.  This report cites a tweet by president Trump that China was asked to come up with a plan to reduce its trade surplus by $1 billion in 2018, only 0.27% of the trade surplus, which looks strange as this would do little to change the trading relationship except that it puts pressure on China to change the direction of the surplus that is growing because of the strengthening dollar and the growth in the U.S.  This suggests that even with the 25% steel tariff America's basic problem of the imbalance in trading relationship with China will continue.  The headlines critical of Trump for starting a trade war therefore look strange in this context and show how little this subject is understood or debated with facts. Even today textbook economics principles are cited after two decades of hollowing out of industry in the midwestern U.S. and in Ontario, Canada. This led to public sentiment shift electing a liberal Justin Trudeau in Canada, and an outsider real estate businessman Donald Trump in the U.S.  For Democrats in the U.S. the support of marginal additional gains in trade with president Obama's push for another free trade agreement in the TPP may have cost them theiir working class base and the election.   ...

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In a new WSJ/NBC New poll, conducted July 24-27, 2009, 42% called the Obama health plan a bad idea, and 36% called it a good idea. In mid June the poll showed Americans evenly divided on this question. It reflects rising anxiety over the costs of the health plan and what it will do to the deficit, and also shows public anxiety about the ways in which Obama and Congress are reaching compromises to pay for it and to control costs. Added to this are the anxieties raised about government involvement in healthcare and medical decisions about care. Noteworthy are two differing pieces of evidence. In the WSJ/NBC News poll, only two in ten people thought the quality of their own care would improve, only 15% of those with private insurance thought that it would improve the quality of their care. And 4 in ten people thought quality of care would get worse, and 45% of those with private insurance thought quality of care would get worse. By focussing on the cost of health care, the administration seems to have ignored or missed the concerns of people about the quality of care if government focussed on cutting costs. These concerns are real as a vast majority of the public, or about 85% of the people, as Martin Feldstein points out in a recent Washington Post column, are insured. The question is what cost would they be willing to pay for the admittedly worthy cause of insuring the uninsured? And even with the unisured, it seems likely with the current Obama reform plan that immigrants and other people may still remain uninsured, at least for some time. Would a huge burden of $1 trillion make this worthwhile, and is there some better way to do this without the prospect of higher taxes further down the road to pay for this. These are points Feldstein makes. The other piece of evidence is that at the same time that there are reservations about what is coming out of Congress today, there is general support for making constructive changes to healthcare. The WSJ poll showed 56% of respondents favoring the basic ideas in the reforms being considered in Congress, with 38% opposing it....

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Now that the trigger mechanism in the August 2, 2011 Debt Ceiling and Deficit bill is in place- with the trigger calling for 50% of the cuts of $1.2 billion to come from defense spending- thoughts are turning to how and what to trim, and what the overarching framework should be. Former Assistant Secretary of Defense, Joseph Nye, says there is a right way to trim Defense spending. The winding down of the two Bush wars could be used to cut ground forces to 1990 levels, trim the purchases of F-35 Joint Strike Fighters, make better use of drones and less costly technologies, and cutting health care costs in defense. This would not affect U.S. national security. What is needed now is also a framework of what the U.S. wants to see happen in its role in the world. Here Nye reminds readers that President Eisenhower decided not to get involved in Vietnam on the side of the French in 1954, saying it was more important to strengthen the U.S. economy. Its important to remember that this decision came only a couple of years after the end of the Korean War. The idea being the U.S. could not police different countries or engage without considering the big picture. In today's context this also means not engaging in nation-building in remote places and in environments that make it not worthwhile to engage precious resources. The U.S. says Nye should consider itself more in Reagan's terms of "a beacon on the hill." Another factor he alludes to is that 70% of the world's military expenditures are now made by the U.S. and its allies. This means there is great potential for burden sharing. Just as the U.K and France essentially combined their resources for achieving overall defense goals of the two countries to accomplish the same things that they did before, the U.S. can do much in combination with its allies. This helps frame policy and solutions for defense. Pearlstein offers policy and solutions for the economy, and Krauthammer offers policy and solutions for deficit reduction in the Washington Post, August 5, 2011, giving an overall picture of what the U.S. and Europe should strive for in coming years....

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Haruhiko Kuroda, 68 years old, a senior finance ministry expert who ran the ministry's currency policy as vice finance minister for 4 years in the early 2000's, is prime minister Abe's nominee for central bank chief. He lectured at Hitoshibashi University for two years before becoming the head of the Asian Development Bank. His book "Success and Failure in Fiscal and Monetary Policy," is critical of the Bank of Japan for mistakes in being first too accomodative in monetary policy to set up the 1987 crash, and then tightening too quickly leading to the deflation and recessions of the last two decades. By choosing an expert with a long experience in the field of monetary policy and a vigorous advocate of getting things right to shake off the deflationary trends, Abe is sending a strong signal to financial markets. Kuroda says he is looking at a shorter time frame to achieve a 2% target for inflation- about two years. In essence Kuroda is taking a page from the policy book of a small group of MIT trained economists, Bernanke at the U.S. Federal Reserve, Draghi at the European Central Bank, and Mervyn King at the Bank of England to boost domestic economies in the context of increasing global growth. The yen weakened to 94.77 to the dollar on Feb 25, 2013, after the announcement. Abe's nominee for one of two deputy governor appointments is Kikuo Iwata, a 70 year old economist who was also critical of Bank of Japan monetary policy since the 1990's. The Abe administration has also carefully communicated this message. Speaking at the Centre for Strategic and International Studies in Washington D.C. Abe said Japan's goal was to increase exports, but at the same time it will increase imports which should benefit the U.S., China, India and other countries. He described a recovery in Middle America from the Dakotas to the Carolinas and sees something like this happening also in Japan. Even the appeals to nationalist sentiment are also coupled with the message to China and S. Korea of not climbing up the escalation ladder and seeking good relations to promote mutually beneficial development. Abe's focus is on building the U.S.- Japan relationship....

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Mark Landler of the NYT intervews Ben Bernanke at his office overlooking the Washington Mall, and Secretary Paulson in his Treasury office. Both men look back at events that led to Chinese savings financing excessive American consumption, and currency and other policies on both sides perpetuating the dependence of America on lowpriced Chinese products, and of China on the American export market. Now that this export market is collapsing it presents China with serious problems with unemployment in the export sector, and pesents America with the hangover from a consumption binge that now must be paid for with years of low or negative growth. Could this have been foreseen and if foreseen could things either have been mitigated or prevented. In March 2005, Prof. Bernanke at Princeton was not at the Fed (his Fed job started in 2006), and cautioned about the imbalances presented by Chinese savings finacing American consumption. But Bernanke saw this as a market phenomenon that would take years, even a decade to work itself out in a global economy. He said "for now, we have little choice except to be patient." The prevailing opinion among Greenspan, Bernanke and others was that the global economy worked in ways that were ultimately benign and regulation was not a good thing. After all the situation benefitted American consumers and kept inflation low while also providing China as an additional engine for global economic growth. The American economy it was believed was large and resilient, and it would not be adversely affected in the long run by such a large dependence on foreign savings. Only the positive effects were visible and the adverse effects were simply talked away as not serious for now. Zoellick, who was deputy secretary of state says that successful models are very hard to change, and Paulson says that without some kind of crisis its hard to get changes made once asituation gets entrenched. For China efforts to strengthen the currency that would slow exports and improve internal consumption were stymied by a reluctance to disturb the status quo, and Americans were lulled into complacency as years of low priced imports provided the best of both worlds, high growth and low inflation. ...

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Vernon Smith, Professor of Economics and Law at Chapman University, 2002 Nobel prize winner, makes an effort to explain in simple language what has happened in the housing bubble, the various aspects of this crisis, and what might help and what might be difficult to accomplish in the rescue plan. He thinks that a reverse auction is awfully hard to do with some success especially as Treasury has no experience with this, and thinks its better to inject capital in banks and companies in return for equity stakes, which incidentally is what Gordon Brown's plan in the UK intends to do. With that Chapman believes Treasury has experience having recently demonstrated that several times including the way Treasury and the FDIC assisted JP Morgan takeover Washington Mutual. He asks readers to look at the Shiller price index graph from 1987 and asks do they think the home prices which only in 2006 and 2007 gradually turned downward and plumetted in 2008, has it run its course. The answer from the graph looks like a no after such a long runup in prices since 1987 and there is a ways to go in 2009 and into 2010. In this context and the context of a declining economy wiith higher unemployment what are the prospects of stabilizing home prices anytime soon? Which suggests injection of capital in return for equity by the government to recapitalize them and get lending back up, as well as act a a clearinghouse to take some of the fear risk out of transactions, as some of the more sensible solutions. And at the same time putting in a comprehensive homeowner relief program with taxpayer money and lender participation to have the lenders modify mortgages, or something like the Hubbard or Feldstein plans, to keep homeowners in their homes. And there is one bit of good news in all this oil prices have already hit $80 a barrel and are headed downward, and so are the prices of all commodities including steel, and the prices of soybeans, corn wheat and so on. ...

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Steve Lee Myers reporting from Moscow and St. Petersburg, Jo Becker from Washington and London, and Jim Yardley from Nicosia, Cyprus, provide this extraordinary and exceptional report on the rise of a small group of friends, mostly from Mr. Putin's time in St. Petersburg, into a new sort of oligarchy replacing the old one under Mr. Yeltsin. This includes more familiar names such as Sechin at Rosneft, but also less familiar names such as Mr. Kovalchuk, chairman of Bank Rossiya, which owns major television and radio stations and newspapers in Russia. M. Kovalchuk is described as having acquired many of these media properties at a fraction of their real value. Bank Rossiya assumed management of assets of Gazprombank, and Gazprom bank purchased Gazprom Media with five television and a number of radio stations for $166 million, when Medvedev, a Putin associate put the value at $7.5 billion 2 years following the acquisition, according to this report. Other assets acquired in this manner include Channel 5 and Ren TV, giving Putin's inner circle control of the media and reducing any critical or different views on issues facing Russia. Many of Gazprom's assets were transferred to Bank Rossiya, say critics, including insurer Sogaz which was acquired for $100 million, later valued at $2 billion, says the report. Names on the this inner circle also include Yakunin, head of Russian Railways, also include names like Fursenko and Timchenko. Most of the people in this inner circle are now targets of western sanctions. Missing in this report is mention that that this inner circle of the second term as president replaces the larger circle of the first terms as president and prime minister, with Putin benefitting from experts and advisors in the first terms. That circle included Finance minister Kudrin known for his successful management of the economy, and others who left the administration after flawed parliamentary elections. Even prime minister Medvedev is not mentioned as part of this inner circle, suggesting a degree of isolation which could be perilous for the Russian economy as it deprives the Russian president of different opinion and useful advice. This is a pattern seen in many emerging market countries which experience corruption during the period of industrial development. A pattern seen also in China under the Communist Party. And in Venezuela where a new Bolivarist class was created. In emerging market democracies such as India and Turkey the problem is also present, except that in India the recent open election led to the ouster of the Congress led government with many cases of corruption in its second term. A similiar election led to a new government in Indonesia, showing that there is another way beyond the Putin Way. Behind the protests in Hong Kong and in Russia, as well as in India, were the huge gaps in wealth and the growing inequality, corruption, lack of responsiveness of ruling governments. In Russia this takes another dimension with efforts to control the internet and media, and efforts to spread this style of democracy. This has created problems in the Putin government's relations with western nations having open societies and free media, and unwilling to accept a distorted model of democracy. Another less noticed aspect of the evolution of these emerging markets is that upto a point development proceeds even accelerates even in the presence of corruption, and then reaches a point where development and growth slows with problems of corruption, mismanagement of resources, declining productivity, economic and political errors, or unfavorable external environment. India faced this problem in 2012-2013, Russia is likely to face this in 2015, and China faces the prospect of growth slowdown by 2016. This feature of emerging markets also reminds one of the frequently quoted old English saying by Lord Acton- "Power tends to corrupt, and absolute power corrupts absolutely." An idea also attributed to William Pitt the Elder who said- "unlimited power tends to corrupt the minds of those who possess it." ...

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A professor at Georgetown University on why it takes time to build democratic institutions, with one important omission- the military in Muslim countries such as Egypt have no intention of building these institutions and have undermined the development of these institutions for decades. A bigger omission lies in inability of the military in the most populous Muslim countries with horrendous gaps in development in basic welfare indices such as education, infrastructure and services, that have put these countries decades behind developing Asia and even Latin America which also had a past of military rule. In countries such as Pakistan and Egypt the military simply lacked the skillset and abilities to deliver in economic terms. Therein lies the biggest failure. In China and Russia the governments have popular support because of their capability to deliver economic growth that has transformed both countries and improved the lives of the people in the region. These crucial omissions explain why Republicans such as Senator John McCain and Lindsey see the need for the U.S. to be on the right side for change. Latin America shook off its history of military rule or one party rule and Brazil, Chile, Mexico are part of two free trade regions in Latin America, supporting the free trade system and economic growth in this hemisphere. The issue ultimately rests with the people of Pakistan, Egypt, and other Muslim countries, and a process of learning, compromise, healing and reconciliation that ocurred in Latin America is likely to follow in the Muslim world. It has already begun in Pakistan which like India has a independent judiciary and lively press, and some of the institutions for a functioning demcoracy. The worst omission is unmentionable because it is so obvious - that of firing live ammunition into protesters for democracy. Years after this happened in S. Korea, Mexico and other countries the day is remembered in a certain way. The important point is that when it comes to this there is no exception to the pattern. ...

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Some of the concern about the economy comes from the economic damage done by the coronavirus. The longer the shutdowns continue the more the damage. About 17 million have filed claims for unemployment benefits. The WSJ consensus of 57 economists is that 14.4 million jobs will be lost in coming months, and the unemployment rate will rise to a record 13% in June, from a 50 year low of 3.5% in February. The earliest the economy could go back to the level in February 2020 is 27 months says the WSJ economist survey. The brighter side of this comes in two aspects of this pandemic recovery curve. By flattening the curve and strict testing, contact tracing and isolation till the vaccine is developed about half the jobs lost can be recovered by the end of summer, says Moody's Analytics. The vaccine a year from now or in 9 months by November 2020 would allow the economy to recover faster. A more optimistic view comes from Daiwa Capital Markets which predicts many of people laid off will be recalled quickly allowing the labor market to recover in 6 months by September or October 2020. Only finance and real estate might take longer but most of the industries where the vast majority of jobs are could be back on their feet. The credible evidence supporting this perspective of a rebound comes from Colorado and Washington which require large employers to specify whether layoffs are temporary or permanent, 70% this year are temporary. Compare this to the prior 2009 recession where this figure was less than 1%- as reported by WSJ. The big push in this direction will be the $2 trillion that the Trump administration and U.S. Congress have committed to this task. Even more so is the determination of president Trump to protect American workers at all costs, that every job counts, and that businesses without exception to get the money have to show that workers are retained. The very success of the aid is being judged by how quickly people are back to work. Now for a look at where the situation is today- Oxford Economics, a UK based forecasting and consulting firm, projects 27.9 million jobs lost with industries other than those ordered to close making up 8 to 10 million of that number. It projects April's report will will capture late March layoffs. It will show cuts to 3.4 million business services workers, including lawyers, software groups, architects and consultants, advertising professionals, in addition to 1.5 million non-essential healthcare workers, 100,000 information workers. One conclusion of this report is that the virus does not discriminate across business groups and business service workers are also affected. Many companies that were hiring will cancel that move and many will cut hours worked. Many of these business services are not a priority. Hospitals are affected too, as they cut elective surgical procedures and routine care that are major revenue sources. Some are now charging for telemedicine visits to maintain some revenue stream. State and local governments employ 20 million workers. As tax receipts decline these local governments will face choices of cutting payrolls and services without enough federal government relief. In a way laying off workers and having them take unemployment benefits shifts that burden to the federal government so that services for overtime to police and paramedics, retention and deployment of nurses in schools.    ...