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Where do you place a winner of the Democratic primary in Maine, Graham Plattner, an oyster farmer who dropped out of college at George Washington University, served briefly in the Middle East wars of Bush and Obama, and had PTSD. Is he working class, middle working class or is he from a downwardly mobile professional class considering he has parents who are well educated and father a prominent lawyer in Maine? Plattner easily defeated a 3 term governor of Maine with his average working class demeanor and language. He is for universal health care, (Medicare for All) universal child care, affordable housing, affordable college. Politics in the US has been moving away from the simple divisions before 1950 created by the Industrial Revolution- the workers in factories and the owners of capital allied with the professional middle class. The few owners of capital mostly college educated allied with people from the non college educated workers in factories who are conservative in their values and beliefs and on the other side the college educated professional middle class now downwardly mobile because of the many recessions and high unemployment from frequent financial crises, with college costing $80,000 a year putting them in deep debt. There is today in the WSJ a story of a professional worker who at $194,000 a year salary is not able to payoff $15000 debt which owners of capital have set at 26% interest and is in downward spiral. Some of this comes from large college and other debt. There is says WSJ Analysis $1.25 trillion in credit card debt alone with highest delinquency rates in decades in 2026. Cost of living has only made things worse and some of this happened as Biden poured money into the economy to help people hurt by the pandemic, yet with some short run consequences with demand strong businesses including hotels, restaurants and grocery stores, auto dealers, jacking up their prices by over 20% in 1 year and Biden failing to respond, getting overwhelmed by open borders migrants under Mayorkas and Harris (also hit by a sudden Venezuelan migrant influx). This is the America one has today- a confusing mix. This in reality means Democrats may take issue with Democrats, Republicans take issue with Republicans, and Democrats join with Republicans on issue by issue basis. It might actually be rational than irrational. On cultural issues if the country has gone over its head and moved too fast on some issues that are not for the general public good, people of different backgrounds can come together to get the best path. On economic issues things are never so straightforward, there are unpredictable consequences and the rules of economics are really not so straightforward either.  Providing relief can mean the government shouldering the burden as during the pandemic which it should, yet with caution as businesses can use the excess demand to raise prices and one is back to square one with everybody worse off as happened with Biden. Migrant flows and fears of insecurity in public spaces can lead to a severe public "discomfort that can waylay the best intentions of a Harris or Biden, leading to public "backlash." In fact the title of a recent book is "Whiplash." Current books include Floridan Marco Rubio's "Decade's of Decadence- How our Spoiled Elites Blew America's Inheritance of Liberty, Security and Prosperity." Rubio means it. Its authentic because as Rubio says repeatedly, his parents could make a living in the 1960's working in a factory with decent wages, low cost of living and low cost of college, the arithmetic between salaries and what you needed for decent home in suburbs and sending children to good public schools, then to college, all adding up. The result is that Rubio could go to college and serve in the Florida legislature. Rubio says in 2026, after the elites under Bush and Obama and faulty economic theory shipped all of our factories to China, that the story of his parents and his education would simply be impossible. This is what he told people in India on his first visit last week. His parents were Cuban immigrants, yet he identifies with Spain and with western civilization, a devout Roman Catholic. Rubio is a Republican, and is in large contrast with Alejandro Mayorkas, also from Cuba, and Biden's Head of Homeland Security. This is the mix of people and representatives in Congress,  business people, small business owners, professionals, that we have today in 2026 in the US. Plattner and Rubio, one a Democrat and one a Republican- both have something in common. Plattner also has general disdain for "the corporate interests, the billionaires, the Washington DC elites, and the establishment politicians."  The winds are blowing in the direction of getting things right- remembering that Eisenhower continued the work of the Kennedy and LBJ administrations (Eisenhower built the Interstate Highway System for instance, and LBJ gave America Social Security and Medicare). Before that Franklin Roosevelt a Democrat built on the work of his uncle Republican Theodore Roosevelt (TR gave America the idea of good governance and built the US Navy, FDR fought the Depression and stabilized a faltering economy after mistakes made by Republican Herbert Hoover could have happened even if Hoover was a Democrat. FDR was himself from a wealthy New York family and when he first met fellow New Yorker Frances Perkins before his struggle with polio, a haughty New York gentleman. That was before Frances Perkins as FDR's Labor Secretary joined forces with Roosevelt to give New York a modernized administration governance structure by 1940 that was applied to all 51 states after 1950. It allied labor with capital with fairness for all, and was the first such modern structure of this size the world had ever seen, which was the fundamental strength of the United States of America. It was imitated in Asia, first in the Shanghai region then China, and first in the Ahmedabad region and now India. The US is faced with the challenge of recreating and rebuilding this today, as first China, then India remind America of its roots which they have followed in their own style and culture.  First good governance, then good institutional structures, alligning labor and capital with fairness for all, strong affordable + accessible educational and healthcare systems, and investments of capital and labor for infrastructure + industrial development. ...

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Prospects for the Indian auto industry with 7% of India's GDP depend on a good monsoon rainy season and a vigorous vaccination drive. Sales declined badly in May 2021 with the second wave of the pandemic.

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India's Finance Minister Nirmala Sitharaman says the decline in the auto sector sales includes as one of the factors the shift by millenials to ride sharing app services such as Uber, Lyft and Ola. A bigger factor is the lack of financing as less credit is available with bad loans hitting the banking industry. The current economic slowdown in India includes a drop in sales of automobiles.

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After declining sales in 2013, India's auto industry recovers in 2014 with 13% more car sales in June 2014 than the prior year month. SUV sales were up 17% in June 2014 over the prior month. Mahindra and Mahindra has 51% of the market share for SUV's from Jan to June 2014, according to LMC. Ford Motor has increased SUV sales in China and is pursuing the same strategy in India.

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US Trade Representative Jamieson Greer says this is not chaos in tariff policy because you don't change 70 years of policy overnight. He says China's is highest because it has the highest trade deficit, then EU, Japan, South Korea at 15% because of the smaller deficits with these nations, Vietnam because it is used  by China to send products to the US, India because of geopolitical reasons buying Russian oil. See Dasha Burns, Politico White House Bureau Chief's  interview with USTR Jamieson Greer.  He says about India- Jamieson USTR calls India "an outlier" and says "I'm confident we will get a deal with India in the near future." India he says has largely corrected its imports of Russian oil and negotiations are underway for a deal.  ON USMCA Greer says of the $31 trillion in trade with Canada and Mexico $29 trillion is us right. trade between Canda and Mexico is small. So he says it makes sense to negotiate separately with Canada and separately with Mexico. This suggests that there doesnt need to be a USMCA- separate deals are just fine says Greer. Mexico has gained much in automobiles under USMCA- US wants to make more in the US including auto parts which it can do by negotiating this with Mexico. It does not make a ton of economic sense to marry the three economies together, says Greer, as the import export profiles, lab,or situations are all different. Are Tariffs good for the economy and do they lead to higher prices? Greer says inflation was down in the first DJT term in trade with China and tariffs. Greer says there is never a 1 to 1 with tariffs. It tariffs become a kind of leveage in getting agreements. That is the style of these tariffs. You tell Ecuador or Brazil we don't make these here so there will be no tariffs on bananas and on coffee. Says Greer- we have seen inflation in check, imported goods relatively low priced. We have seen that we can have growth and higher wages with tariffs at the same time. The growth in 2025 third quarter at 3.8% annual growth, and Atlanta Fed predicting 4.2% growth in 2026. And tariff money can be used for paying down the debt and financing America's reindustrialization, Greer says members of Congress are asking about this.When a new administration comes tariffs will still be part of the playbook. ...

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The auto sector has an outsized effect on economic growth that is not easily grasped. The IMF sees a fifth of slowdown in growth of global gross domestic product and a third of world trade coming just from low demand for autos. The auto sector feeds into demand for steel, aluminium, copper, plastic and electronics, so it feeds into other sectors. Aging populations, stagnant incomes, ride sharing, and economic headwinds on trade for China, slower demand with lower economic activity in India from bad loans and low credit in the finance sector, all have cut into growth. Tariffs from president Trump and tit for tat tariffs increase costs and cut into profits. In Europe there is added factor of mandated drop in carbon dioxide emissions by 20% by 2021. The new technology will increase costs of autos by 800 to 5000 euros and add 5-11% to the selling price, reducing sales by about 5%.  A fast growing market is India but companies such as Ford and GM have moved out as it slows down. Higher emissions standards in India for 2020 are likely to increase prices in a very price sensitive market. Lower availability of credit in China and India have led to drop in sales of about 15% in both major markets for autos since mid 2018.   ...

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Sales of passenger cars in India have increased from 675,000 in 2002 to 1.4 million, with 200,000 exports. The study by IBM and the Transportation Research Institute of the University of Michigan forecasts that sales in India of passenger cars will double again by 2010 to 2.8 million and reach 4.2 million by 2015. Auto loans are more prevalent in India with banking consumer credit better established than in China. The minus side is the bad condition of roads which will take a lot of resources and effort to fix but is likely to be accomplished in te next ten to fifteen years. One advantage for the auto industry is that the government fully supports the auto industry and even has a plan with targets to be achieved by the auto industry. With manufacturing lagging behind in India the hope is to build a manufacturing base for automobiles and auto parts that will generate jobs and expand manufacturing capabilities.

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Global supply chains in industries such as clothing and other consumer items, in autos, and in tech products are changing as the shift away from China continues with the Trump administration's tariffs war. The clothing and other consumer products manufacturing is shifting away from China. Auto production is centred on regional hubs for manufacturing under renegotiated trade agreements such as the one that replaced NAFTA in North America, correcting imbalances in wages and U.S. content. Mexico gets to stay as a auto hub with exports of $50 billion in 2018 but under new rules that the Trump administration sees as fair. India is being considered as an auto production hub in Asia. In tech products China continues to have an edge but this is changing gradually. Samsung has built a huge smartphone manufacturing complex in Vietnam. South east Asia is a beneficiary, so is Mexico. In the future India stands to gain as its manufacturing base expands and infrastructure develops. In this changed scenario China will be moving to produce more advanced technological products, as it shifts away from lower end products. This will also correct some of the grossly unfavorable trade imbalances that have developed with the U.S. ...

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Small business and farmers are driving a recovery in the Indian economy in the latter half of 2020 after the impact of the pandemic. Rural India with demand from farmers for cars and tractors is also helping build demand. Maruti Suzuki, India's largest auto manufacturer, had sales increase of 10% in rural India vs. 4% overall in the third quarter of 2020. Manufacturing and farm sector are leading the recovery. Transport and hotel, airlines are also seeing an increase in demand. From 2 million in June airline passengers have increased to 5 million in September compared to 12 million before the pandemic. The second generation reforms made by the Modi administration and the many initiatives are expected to boost the potential growth and scale of the Indian economy. Building a strong manufacturing sector and getting foreign investment in that sector is also a critical step to building the economy's growth potential. Working with Taiwanese investment and investment from the U.S. and the European Union is part of this effort. ...

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So much for political campaigning and talk of inflation, inflation comes in lower in September after DJT tariffs of 10-15% on EU, Japan and other trading partners. The higher tariffs on China are action needed to reduce trillion dollar trade deficits the world has with China, deficits that are economically destabilizing for the world economy, with supply chain concentration a serious problem. US inflation in September came in at 3.0 percent lower than expected.  One reason is that the headline numbers are high but in actual practice the tariffs are on average at 12.5% not 17% or 25% as headlines show. The tariffs vary by country and the US was careful to keep them at 10% for the EU and Britain and 15% for Japan, the key trading partners. China is an exception at 47% because it is US policy to reduce the world's 1 trillion trade deficit with China and cutting this is a major goal. For decades the US tried every possible way to bring it down to no avail till this effort with tariffs. Another is exceptions in products- for India this includes semiconductors, smartphones and pharmaceuticals. Another factor is that postpandemic inflation in 2021-2022 created higher profit margins in auto, retail and other sectors of the economy. As a result only 30-40% of the tariff gets passed onn to consumers. In autos only about 20% because buyers cannot afford the high prices. Some tariffs are still being negotiated and are a foreign policy tool to get India to stop funding Russia in the Ukraine war knowing that India was importing most of its oil from non-Russian sources till 2019. China is also funding Russia, that is true but the US can insist on exercising its leverage with Asian partners not China. With China the tariff on fentanyl and the overall 47% tariff- down from 57% after meetings in Busan, South Korea between Xi and DJT last month- shows the US takes the Chinese role in distorting world trade to its benefit seriously.  ...

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Tata Group chairman Ratan Tata says JRD Tata who ran the company for most of the modern period would be overjoyed if he were alive today to learn about the return of Air India to the Tata Group. Under a deal with the Indian government Tata will pay $2.4 billion to cover one fourth of Air India's debt. The government will give up ownership in the airline. AIr India started as Tata AIr in 1932 flying mail and passengers from Karachi to Bombay during the British period. JRD Tata himself flew the maiden flight which is why Ratan Tata sees the return of the airline to the Tata Group with much optimism. Air India has 120 aircraft, 4400 domestic and 1800 international landing and parking slots. Problems at the airline led to losses of $3 million a day. It was nationalized in the 1950's. The Tata Group is India's largest steel producer, a major auto producer. It is India's largest conglomerate with $100 billion in sales, and employs 800,000 people in 100 countries.  ...

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The main lines of the Message to Congress by the US president in 2025 related to flood of illegal immigration, and illegal fentanyl flows with deaths of Americans in the most vulnerable neighborhoods across 51 states over 12 years, 490,000 deaths, more than Vietnam. "The media and our friends in the Democrat Party kept saying we needed new legislation to secure the border—but it turned out that all we really needed was a new president.” As it turns out the legislation Biden with Republicans led by Senator Lankford negotiated in Feb 2024 did not have the strong action taken in the first 100 days to deter illegal immigration and remove illegal immigrants endangering safety in American neighborhoods. That legislation did not have provisions to bring illegal fentanyl flows into the US to an end with strong action including tariffs on CMC countries Canada, Mexico and China responsible for the fentanyl flows into the US. Transgender was another issue addressed in the speech with DJT clearly stating that their only two genders and against mutilation of bodies, with trust in God about the gender God placed us in as best for us. Other issues were about tariffs action going into effect on reciprocal tariffs on April 2 with all nations including India, Europe, China, Japan, South Korea. DJT cited India for high tariffs, South Korea with 4 times American tariffs, and European nations. The goal was to ensure a level playing field for the US to compete- "what they charge us, we charge them." As explained in an earlier article in the WSJ reciprocal tariffs in the world context mean commodities products would not have price increases for the US consumer, smartphones autos would increase but this would be temporary as these nations play fairly and create a level playing field, and these products manufacturing is shifted to the US. This would mean growth for US auto industry and smartphones coming from inside the US and from India offsetting concentration of production in China. Apple has told the president it will start making inside America investing hundreds of billions in the US from now on. ...

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Steps the Modi government in India is taking in the 2020 Budget to tackle slowing growth include relaxing the fiscal deficit target from 3% to 3.5% of GDO, selling public sector companies to generate more funds, so that additional investment can be done in infrastructure, rural development, education and health care. Growth of the economy is expected to drop to 5% for the fiscal year ending March 31, 2020.  A weak banking sector with sharp decline in credit, and decline in the auto sales by 20%, have worsened the decline in growth.  Ms. Nirmala Sitharaman, the Finance Minister, said that this budget is designed to "boost Indian incomes, and enhance their purchasing power." The Indian slowdown comes in the middle of a global slowdown, with China's growth expected to be 4.9% in the first quarter of 2020. Growth was further weakened after the effects of the coronavirus lockdown on parts of China, disruption of supply chains, partial closure of businesses. ...

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Poorly capitalized Indian banks and financial institutions with large percentage of bad loans contiues to hurt the Indian economy. Shortage of credit is leading to problems in retail and auto sectors. The government is using $21 billon from the central bank, the RBI, for stimulus and to recapitalize banks. Higher infrastructure spending is needed to make up for a drop in consumer demand.

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The auto parts industry is seeing a huge transformation as American Axle, Visteon and other companies look to Europe, Asia and other countries for growth and shift to a lower cost manufacturing base overseas. Costs are in many cases about 5 times in the USA than in other countries in Asia. And health care costs are a major part of the costs the auto parts makers face in the USA. To get an idea of how fundamental a change is going on American Axle which in 1995 did not have a plant overseas now expects 75% of its $1.3 billion in product orders to be met by plants overseas. And it is planning to build plants in India and Thailand. Visteon which used to be part of Ford Motor and made parts like heating and cooling systems mainly for Ford, will by 2010 according to Visteon's CEO, have sales to Hyundai and Kia of 28% of sales, making the Korean company its largest buyer. Ford's North American operations will only account for 6% of sales from 15% today. That is a dramatic change and involves closing plants in the US. For Visteon this means $635 million in cost reduction mainly through plant closings in 2008-2010....

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As climate changes the World Bank reports that 75% of India's urban populations, about 380 million people, work in jobs exposed to extreme heat, life threatening heat.This is the informal workforce that generates 50% of GDP, that works as street vendors, construction or factory workers, house help, auto rickshaw drivers, street cleaners, delivery people and guards. More people will be added- over 400 million by 2050 as India urbanizes further. The Guardian looks at the situation in Bengaluru that in year 2000 was still cool and leafy except for summer that was for for a few months March to May with temperatures peaking at 34 degrees centigrade. Now the summer heat happens earlier 34 degrees C. by February and 38 degrees C. by May. Then there is the heat island effect as the city  built from asphalt cement and metal heats up during the day and heats the atmosphere at night.

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GDP growth in India's economy decelerated to 5% in the last quarter after 8% growth in full year 2018. Stimulus measures, recapitalizing banks and increased infrastructure spending is supported by the Modi government as a way to cope with this crisis. Much of the problem stems from bad lending by banks from an earlier period.  Lack of credit is hurting the retail and auto sectors. Drought conditions in some rural areas hurt the rural farm based economy.

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India Production Linked Incentive to provide incentives to manufacturing in key sectors of the economy under Atman Nirbhar Bharat Abhiyan is discussed here in The Mint. PLI for textiles production and for pharmaceutical production with bold targets for 2025 are suggested. Other sectors are telecom (mobile phones) and networking (5G), computers, servers and other devices including Artificial Intelligence and related technologies a sector given special emphasis by minister Ravi Prasad in the video on PLI. 

Also included are automobiles and auto components, cell battery, solar technologies and production, specialty steel.