There is a light at the end of the tunnel. (CP)
« April 2010 | Main | June 2010 »
There is a light at the end of the tunnel. (CP)
YOU SHOULD KNOW: Extreme weather warning for Toronto as near-record-high temperatures expected all week, raising heart-attack and other health risks.
WORLD
OECD raises global, U.S, and even debt-crisis-plagued European GDP forecasts for this year and next. That's astonishing, especially regarding Europe. Sorry, Seattle and subsequent protesters, but stronger global trade ties seem to be the main reason. They've made the world better able to cope even with a downturn the magnitude of the Great Recession. U.S. economic growth is now forecast at a robust 3.2% this year and next, up from previous expectation of 2.5% this year and 2.8% in 2011. That in turn has OECD increasing by 50% its predicted growth rate for Japan - dependent on auto exports to U.S. - to whopping 3.0% this year and 2% in 2010. European growth is now seen at 1.2% this year, 1.8% next year, up from 0.9% and 1.7 per cent forecast back in November, before the eurozone-debt-crisis fears. (Photo: A worker lifts a sheet of film used in making solar-energy panels at United Solar Ovonic Jinneng Ltd. Co. in the Chinese industrial center of Tianjin, May 22. -Reuters)
BP's infamous Deepwater Horizon rig in the Gulf of Mexico on April 20, the day it exploded. Within two days, the remains of the rig had sunk, taking 11 lives. (U.S. Coast Guard handout.)
BP knew of severe rig problems hours before deadly explosion and subsequent massive oil spill, as revealed in company documents released by U.S. members of Congress yesterday. BP could be looking at huge $4,300 per barrel civil fines, over and above repair and clean-up costs. "These civil penalties could be staggeringly high, possibly running into the billions," Professor David Uhlmann, director of the Environmental Law program at University of Michigan, tells Reuters.
Chretien, at unveiling of his official parliamentary portrait, defends politicians. "They work hard, these guys,” sayeth the ex-PM. "And you know, they are an honest crowd and everybody pictures them as a bunch of crooks. It's very unfair.” Was it Twain who said the majority of politicians give the rest a bad name? Or was it the head of the inquiry into Chretien's sale of Quebec hotel to a known firebug, with financing the PM pressured a hugely reluctant government to pny up, and who promptly torched the place - no wait, couldn't be, there was no inquiry. Anyway, Chretien knows it's the "gotcha press" that causes politicians to be in bad odor. (Photo: CP)
Canadians split on monarchy, ahead of next month's Royal Tour by Her Majesty of...Canada? Civility being my core value and, I believe, that of Canadians, I accept a status quo accurately reflecting the majority sentiment of my fellow Canadians. But I'm glad that sentiment might be changing, a mere 143 years after "Confederation." Really, much as I do admire and hold affection for Elizabeth II, she's not my Queen. She's not my head of state or of government. That somehow the world takes Canada, Australia and New Zealand seriously as sovereign nations when each does not, in fact, enjoy complete sovereignty from their former colonial master is a mystery to me. No bill becomes law in Canada without Her Majesty's signature (Royal Proclamation). Need Brazilians wait for a signature in Lisbon before their will becomes law in their homeland? Do Indonesians still await word from The Hague? Does an image of a descendant of George III appear on U.S. currency? Turns out I'm a republican, but please, lower-case "R." At least until the party of Lincoln and TR makes a reappearance, which I'm guessing will happen before we shed our continued vassel-state status.
Odysseus, hero of Homer's Odyssey, may have taken route around the Bay of Fundy. Glad this is getting out only now, sparing me high-school Latin. As Churchill said of an adversary known to have read Homer as a child: "Serves him right." I think what we have here is an over-caffeinated department of tourism in the Maritimes. (Illustration: Odysseus confronting the Cyclops. -GML)
BUSINESS
Technological breakthroughs at CAE and Magna remind me RIM isn't our only global champion in new-product development.
THE WAY WE LIVE TODAY
My son and I text, not talk. (This means you, MLC.) "Instead of pep talks and advice, I send him monosyllabic, misspelled messages. I get the feeling he prefers that."
U.S. consumer group warns on huge portions typically served by chain restaurants. Offenders include the Cheesecake Factory's Pasta Carbonara with Chicken (2,500 calories), Bob Evans' Cinnamon Cream Stacked and Stuffed Hotcakes (1,380 calories) and P.F. Chang's Double Pan-Fried Noodles Combo (1,820 calories). Context: Most experts say you shouldn't consume more than 2,000 calories a day. I've said it for years, we needn't experiment with an endless assortment of slimming diets. Just two words will suffice: Portion control. Just because it's there doesn't mean you are required to clean your plate.
Google's search-engine main page on the weekend. (Google handout)
Google's weekend tribute to Pac-Man anniversary may have cost 4.82 million lost work hours and an estimated drop in global productivity of $120.5 million. Okay, I plead guilty for my share of that. I think it ate up about 20 minutes of my time, an innocent (I thought) blast from my teen past.
Management never sleeps. (Getty Images)
U.S. President Barack Obama meets with cadets at West Point after a speech of Afghan policy there earlier this year. (White House photo)
Obama to make history again this week with bill for Congress scrapping odious "don't ask, don't tell" policy in the U.S. military. Ending the 17-year-old rule has the support of the U.S. defense secretary, head of the joint chiefs of staff - and, as she told Larry King week before last, Laura Bush.
"Spill, baby, spill!" is motto of protesters at BP's U.S. head office in Houston over the weekend, demanding candor on the magnitude of the BP massive oil spill in the Gulf of Mexico. (AP)
Patience exhausted with BP's futile attempts so far to stem oil leak in Gulf of Mexico. BP to hold press conference tomorrow on latest Hail Mary attempt to cap well that could eclipse Exxon Valdez as worst oil spill in U.S. history. "Nearly nude" protesters at BP's U.S. headquarters in Houston demand company "bare the truth" about likely environmental damage to Gulf coastal communities.
U.S. crime rates continue falling in double digits in most major cities. That's counterintuitive, one would think, given the Great Recession. But the demographic group most prone to crime - males age 18 to 24 - have been a steadily declining share of the population since the early 1990s, a decade marked by consecutive double-digit drops in crime in all major American cities.
Who to believe? One survey today finds Raleigh, N.C. (shown at left) to be America's most liveable city. (The Economist says it's Pittsburgh, but without an argument you don't have a horse race - and who said these surveys are scientific? Meanwhile, Portfolio, the online business magazine, says Portland, Me. - that's right, not Portland, Ore. - along with other East Coast cities trumps L.A., Seattle, Vegas and other Western centers as the most fun places to live and visit.
Fergie in trouble again, caught in sting operation willing to sell access to former husband, a Eurocrat, for a princelessly $750,000. She doesn't deny tabloid exposure of scandal, admitting she's in financial distress. Too bad we aren't all still on good terms with influential ex's. Sympathetic Brit monarchists are calling it a gaffe. In America, it's called a extortion and the prisons are filled with former illustrious office-holders who learned the wrong way the price of abusing public trust.
Toronto, which adopted motto "People City" in 1970s and quickly abandoned it, poised to adopt the real thing by creating pedestrian-only zones on major thoroughfares. This in addition to controversial planned additional bikes lanes sure to be an issue in November mayoralty election, pitting motorists against other users of Hogtown's notoriously congested roads.
Victorious Philadelphia Flyers made short work of the les Canadiens and are headed for the Stanley Cup final this weekend for the first time in 13 years. (CP)
After eliminating Canadiens, Philadelphia Flyers set for first Stanley Cup appearance since 1997, against Chicago Blackhawks this Saturday. Full schedule of games here.
FINANCE
Embarrassing moment for Geither in Beijing as the U.S. treasury secretary tenders a reassurance to Chinese officials that American has means to cope with its burgeoning debt. Tells America's biggest creditor that the U.S. can manage its way out of back-to-back record $1.5-trillion budget deficits this year and next.
Troubled Borders, No. 2 U.S. bookstore chain, based in Ann Arbor, Mich., finds "angel investor" with confidence in firm's turnaround plan. If only bricks-and-mortar Barnes & Noble was the problem. Wal-Mart is now U.S.'s biggest bookseller, and Amazon commands online book retailing.
Jeff Immelt, CEO of General Electric, world's largest industrial conglomerate, had an upbeat forecast on the U.S. economy for the Boston College audience for his commencement address yesterday. He also urged the students to do a more ethical job of running America's leading institutions than the current one has. (Reuters)
GE boss says European economy is "teetering," but not to worry, U.S. is poised for strong rebound. In his long career at GE, Jeff Immelt says, he can't recall a time when Europe could boast the rapid growth rates of major developing-world economies in any case. As for U.S., CEO of bellwether GE is far more upbeat than most economists and peanut-gallery observers, myself excepted. I see strong 4% GDP growth by 2012 and unemployment in 6%-7% range - not the 4% where it belongs, but much improved from current 9%+.
Facebook CEO finally fesses that company screwed up on privacy issues. Reforms are in the works, he vowes. Shows what a concerted grassroots pressure campaign can do, since before the complaints started rolling in from Main Street, Facebook brushed off the danger to user privacy of its obvious security lapses.
One of Obama's traits is that unlike Bill Clinton, he doesn't crave praise. It's the professor in him. He expects folks to just see the results of what he's done - which is rather a lot in 16 months - and let them speak for themselves.
That's obviously not good enough in politics, never has been. You have to brag. Have to point out why you're better than those who'd block or replace you. An achievement might be self-evident to you (and to the constitutional law students Obama taught for 11 years) but not to Main Street. Gotta 'splain yourself.
Or so Frank Rich argued yesterday regarding Obama's record.
Obama campaigning in Charlotte, N.C., Sept. 21, 2008. (AP)
But first here's David Leonhardt, Rich's NYT colleague and the paper's top economics reporter, on what Obama has accomplished in just 16 months:
With the Senate's passage of financial regulation, Congress and the White House have completed 16 months of activity that rival any other since the New Deal in scope or ambition. Like the Reagan Revolution or Lyndon Johnson's Great Society, the new progressive period has the makings of a generational shift in how Washington operates.
First came a stimulus bill that, while aimed mainly at ending a deep recession, also set out to remake the nation's educational system and vastly expand scientific research. Then President Obama signed a health care bill that was the biggest expansion of the safety net in 40 years. And now Congress is in the final stages of a bill that would tighten Wall Street's rules and probably shrink its profit margins.
If there is a theme to all this, it has been to try to life economic growth while also reducing income inequality. Growth in the decade that just ended was the slowest in the post-World War II era, while inequality has been rising for most of the last 35 years...
Mr. Obama has been trying to reverse the Reagan thrust...[Reagan's] policies ended up magnifying income inequality, which was already rising for other reasons. Since 1980, median household income has risen only 30 per cent, adjusted for inflation, while average incomes at the top of tripled or quadrupled. Every major piece of the Obama agenda is meant, in part, to push back against inequality...
BTW, that median income growth since Reagan works out to 1% a year.
And that percentage would negative, way negative, except for the forced double-breadwinner phenomenon. Which has made being a stay-at-home parent no longer a viable option for most middle-class Americans. Which means the standard of living for the American middle class has plummeted for the first time in the history of the Republic.
Obama, finally, is trying to reverse that. And has put in place substantial means of doing so. But, oops, he didn't focus instead on job recovery, so the Dems are doomed in November. Here's Frank Rich:
The enthusiasm gap remains...Democrats are less energized in part because even now the president has not fully persuaded many liberal populists in his own party that he is on their side. The suspicion lingers that a Wall Street recovery, not job creation, was his highest economic priority upon arriving at a White House staffed with Goldman alumni. No matter how hard the administration tries to sell health care reform and financial reform as part of the nation's economic recovery, these signal achievements remain thin gruel for those out of work.
Indeed they do. As a comisserating Vice President Joe Biden himself said, last year, "If you're out of a job, to you it's still a Depression."
Obama, as it happens, turned his attention to job creation even before he was inaugurated.
Which is how he was able to prize an unprecedented $787-billion stimulus package from Congress within weeks of taking office. The stimulus package saved an estimated 2 million jobs from being lost. As for stabilizing the banking system (Wall Street, as Rich prefers to call it), failure to continue the bailout actually initiated by George W. Bush would have plunged the U.S. into a second Depression, not the Great Recession.
By the reckoning of Hank Paulson, Bush's able treasury secretary, without that $700-billion rescue of tottering banks and brokerages, the entire system'[s collapse - including the banks' function in clearing payroll and supplier checks - would have resulted in unemployment of 25% to 30%, rather than today's 9%.
Obama incidentally found time to rescue GM and Chrysler, saving tens of thousands of high-paying jobs in the Midwest and preserving the guts of America's U.S.-owned manufacturing sector.
It's not for me to tutor a former illustrious drama critic on economic fundamentals. But one of them even he should know is that job creation is the last thing to recover coming out of a recession. After even a mild downturn, employers look for at least two quarters of strong economic growth before committing to job creation and plant, product and geographic expansion.
The Great Recession was not a mild downturn, and the wait will thus be even longer. In the most recent quarter, U.S. corporations posted record profits. Indeed, they're sitting on something like $2.5 trillion of cash they could be investing in job creation. Instead, they're using that money to buy back their own stock, increasing the value of shares held by top executives, and restoring or increasing dividends.
I will always remember that the Pelosi-Reid 111th U.S. Congress was one of the hardest-working in the history of the Republic, no matter what the polls say. And it was what Obama put on their agenda that Congress toiled long, hard and successfully to make the law of the land.
I will agree that the Dems haven't fashioned a message to rightly claim credit for what they've done, and the additional progressive measures they would do with continued control of Capitol Hill. Obama has missed three golden opportunities - at commencement addresses at the University of Michigan, Hampton University and last Saturday at West Point - to establish the outlines of that message:
Our party stands for economic freedom. You really don't have much freedom without money in your pocket. We stand for reducing the growing gap between rich and poor. Because denying the least advantaged among us the chance to contribute holds back our entire nation. I am a fighter for the middle class. Because our middle class is - always has been, always will be - the bedrock of the most successful country the world has ever seen. Yet our middle class has been neglected. It has been made to shoulder the burden of spiralling healthcare and tuition and fuel costs. And this has been going on for decades.
With our stimulus package, we began putting Americans back to work within a year of my taking office. No economist thought that was possible, but I know the American people better, I know their resourcefulness, their persistence, their fighting spirit. Our healthcare legislation has made high-quality healthcare a right of American citizenship, no longer a privilege of those with enough money to afford it. And our financial-markets reforms will prevent us ever again having to use the hard-earned tax dollars of the American people to bail out incompetent fat cats on Wall Street. We begun the mission of putting our middle class, and middle-class values of prudence, responsible behavior and patriotism - back at the center of our American way of life. I believe that is the only hope for the great future I see for this country.
My Republican friends have made it abundantly clear that they have a different vision. They still worship at the altar of "anything-goes capitalism," which put more than 8 million Americans out of work since 2007, until my economic team finally turned the corner and America began creating jobs again early this year. The Republicans voted against my party's stimulus bill, which has put millions of Americans to work rebuilding our bridges, our century-old hospitals and schools. That in turn will make America more productive, more competitive and more affluent than we have been at any time in our history. As will the billions of new dollars I've committed to unlocking the mysteries of science at our nation's great universities and colleges. We will unlock those mysteries in stem-cell research, giving new hope to fellow Americans suffering with Parkinson's Disease and Alzheimers. We will use our strengthened research and development powers to take the lead in renewable energy and kicking the addiction to imported oil - a race in which the whole world is competing.
By contrast, the Republicans have one idea, and that one idea is bad. They want to extend the Bush tax cuts for the very richest among us. We tried that idea for eight years, and it failed. It failed completely and disastrously. But this remains the Republicans' only solution to the challenges we face as a nation in the 21st century. A century when only nations with first-class education and first-class healthcare will make it to the finish line, not countries that give tax break to people making more than $250,000 who neither need it or want it. Investing in our people, investing finally in our middle class - this is the key to a second American century even more glorious than the first.
To borrow a line from Adlai Stevenson, when the Republicans stop distorting my record - making me out to be some kind of wild-eyed socialist - I'll stop telling the truth about them. Which is that almost every time I've tried to do something to improve the lives of Main Street Americans, the Republicans have voted against it. They really do think that the eight years when their president was in charge - the period of least job creation since the Depression - was some kind of golden age. And they want to return to that. Do you? No? Then will you join me and my fellow Democrats in bringing about this Second American Century? A Second American Century in which we lead the world in the highest-quality education. In which we are the healthiest nation in the world. And the most creative and prosperous nation in the world? That's the golden age I'm fighting for. And it's in our future, not in tried and failed ideas of the recent past.
Something like that.
And, as Churchill said, it has additional benefit of being true.
Miss Michigan, Rima Fakih, wins the Miss U.S.A. pageant Thursday. (AP)
From the Detroit Free Press, on Thursday's victory of Rima Fakih of Dearborn as Miss. U.S.A.:
'Everyone should be proud of who they are and where they come from because America is a big melting pot of diverse ethnicities. It's great to be part of this wonderful country.'
Born in Lebanon, Fakih grew up in New York and moved to Dearborn, which has the highest concentration of Arab Americans in the U.S. Since her victory, some people have complained about Miss USA being Arab American.
David Olive is a business and current affairs columnist at the Star, which he joined in 2001 after stints at the Globe and Mail, National Post and Financial Post.
"If all economists were laid end to end, they would not reach a conclusion."
- George Bernard Shaw
