china confidential
Saturday, November 22, 2008
Obama Outlines a New New Deal
Dateline USA....
US president-elect Barack Obama announced Saturday that he had ordered his economic advisers to produce an economic recovery plan to create 2.5 million new jobs over the next two years.
"We'll be working out the details in the weeks ahead, but it will be a two-year, nationwide effort to jumpstart job creation in America and lay the foundation for a strong and growing economy," Obama said in his weekly radio address.
Obama, who has vowed to make the economy his priority when he takes office from President George W. Bush in January, said the effort should produce 2.5 million new jobs by January of 2011 and lay the foundation of the country's economic recovery.
His announcement came two days after government data showed that new jobless claims had surged to a 16-year high, in a new sign that the world's largest economy appeared to be sliding into a deep recession.
This year, the US economy has shed 1.2 million jobs, and the president-elect warned millions more could be lost next year without urgent action.
Energy and Infrastructure
The Federal Reserve has warned the jobless rate could climb to 7.6 percent in 2009 as the economy struggles with a sharp downturn and a global financial crisis.
Obama said he intended to put people back to work rebuilding roads and bridges, modernizing schools, building wind farms, solar panels and fuel-efficient cars.
He also plans to develop alternative energy technologies that he says can free the United States from its dependence on foreign oil and keep the US economy competitive in the years ahead.
"These aren't just steps to pull ourselves out of this immediate crisis," he said. "These are the long-term investments in our economic future that have been ignored for far too long."
Obama said his economic recovery plan represented "an early downpayment" on the type of reform his administration will bring to Washington.
He said he wanted to form a government "that spends wisely, focuses on what works, and puts the public interest ahead of the same special interests that have come to dominate our politics."
The announcement came amid media reports that the Illinois Democrat had picked New York central banker Timothy Geithner to be his treasury secretary.
Geithner, 47, is well known to Wall Street from his role as New York Federal Reserve chief and was a career official at the Treasury Department from 1988 to 2001, serving under three administrations and rising to undersecretary for international affairs.
As the successor to Republican Henry Paulson, Geithner would become the overseer of a 700-billion-dollar bailout package for distressed banks at a time when the world's largest economy is staring at recession.
- AFP
In China, the Best is Yet to Come
Global doom and gloom got you down?
Forget about it! In China, the best is yet to come.
So says Money Morning contributing editor Keith Fitz-Gerald. Although China's economic growth may slow from 9.6% to 7.75% next year, that is no reason to write China off, according to Fitz-Gerald. He writes:China is much like America was at the dawn of the Industrial Revolution. Sure, there are problems – and, admittedly, it’s easy to focus on a whole slew of them right now – but there’s still all kinds of potential, too.
If you’ve ever been to China, you know exactly what I’m talking about. You literally can feel the broad sense that the best is yet to come. Contrast that with the United States or Western Europe, where hand wringing, and finger pointing are the norm.
Why is that?
Because, as I mentioned a few weeks back, Beijing “gets it.” And China’s central government is taking major, decisive steps to ensure that China’s people do, too, an admirable example of the kind of leadership that Washington’s self-absorbed politicians seem no longer capable of delivering. Most recently, as Money Morning reported, Beijing approved a $586 billion stimulus package. In an era of trillion-dollar bailouts, that was almost too small to register on the old Richter scale here in America. But it should have.
If America were to put in place a stimulus plan that represented the same proportionate outlay that Beijing’s will for China, we’d be talking about an infusion of nearly $1.83 trillion, or 10.89 times more than the positively puny $168 billion stimulus that went into the hands of U.S. taxpayers last year. And it would probably dwarf anything that President-elect Barack Obama is contemplating right now.
Click here to read the entire--extremely persuasive--essay. The contrast between China's plan to recharge its economy and what is likely to come in the U.S. could not be more dramatic. Like the country he so admires, Fitz-Gerald "gets it."
Sunday, 23 November 2008
Posts
