Month: October 2017

Trump Ponders New Head for Federal Reserve

President Donald Trump says he is “very close” to picking a person for the most important economic post in the United States, the head of the Federal Reserve. Current Chair Janet Yellen’s term expires early next year and she is one of at least five candidates for the job.

Besides Yellen, the candidates include Fed board member Jerome Powell, former Fed governor Kevin Warsh, Stanford University economist John Taylor and Trump economic adviser Gary Cohn.

Moody’s Analytics economist Ryan Sweet says a new Fed chief is likely to continue current policy at least for a while because “rocking the boat” could rattle financial markets.

The Fed’s job is to manage the world’s largest economy in ways that maximize employment and maintain stable prices. During recessions, the bank cuts interest rates in a bid to boost economic growth and create more jobs.To cope with the most recent recession, the U.S. central bank slashed interest rates nearly to zero.

The jobless rate fell from 10 percent to the current 4.2 percent, and the economy stopped shrinking and began growing slowly.

Critics of the record-low interest rates said keeping rates too low for too long could spark strong inflation and damage the economy. However, the inflation rate has been below the two percent level that many experts say is best for the economy.

As a member of the Fed’s board and later as Chair, Yellen supported low interest rates and a slow, cautious return to “normal” rates. Experts also say she improved communication between the Fed and financial markets, which reduced uncertainty and reassured investors.

Trump criticized Yellen during the campaign, but then as president, praised her work. Analysts Tom Buerkle of “Reuters Breaking Views” gives the Fed credit for taking effective action during a crisis when Congress was reluctant to act.

Another candidate is former investment banker Gary Cohn, who now heads the National Economic Council at the White House. He has reportedly been working on efforts to reform taxes and boost spending on U.S. infrastructure.

Fed Board member Jerome Powell is also a candidate. He is a Republican with a background in private equity who served in a top Treasury Department post. Powell supported Yellen’s approach of slashing interest rates during the crisis, and returning them to historic levels as the economy recovers.

When rates were cut to nearly zero, Fed officials took the further step of buying huge quantities of bonds in an effort to push down long-term interest rates to give additional economic stimulus. The complex procedure is called “quantitative easing.”

“Ryan Sweet of Moody’s Analytics says when the next recession appears, Powell will be more willing to use tools like quantitative easing than more conservative candidates like Kevin Warsh and John Taylor.

Warsh is a former member of the Fed’s board, a lawyer, and a former executive of a major financial firm with experience at the president’s National Economic Council.

John Taylor of Stanford University and the Hoover Institution is an eminent economist who has served on advisory councils for presidents and congress and written books on economic topics. Taylor came up with an equation, called the “Taylor Rule,” that considers inflation as well as slack in the economy as a way to set interest rates. Some conservatives say the Taylor Rule would improve policymaking.

Critics say the economy is too complex to be managed by a computer, and the Taylor Rule would make the Fed less independent and effective.

Tara Sinclair of Indeed.com says independence is a “key part” of having an effective monetary policy. She says the interest rate-setting process and other decisions need to be separate from Congress and the administration so interest rates and other policies are based on long-run economic needs.

The president is expected to announce his choice in early November.

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N. Korean Debt to Sweden Remains Unpaid After Four Decades

More than four decades after selling 1,000 Volvos to North Korea, Sweden is still trying to get paid for the cars.

The vehicles were part of a $131 million trade package delivered to North Korea in 1974, during a period of openness. But Pyongyang never paid anything on the deal, leaving a debt that has now accumulated with interest to $328 million, according to the Swedish Foreign Ministry.

North Korea owes millions elsewhere in Europe from purchases made during the early 1970s, when Pyongyang was expanding economic relations with the West.

“Volvo Car Corporation sold approximately 1,000 of our 144 sedan(s) to North Korea in 1974,” said Per-Åke Fröberg of Volvo Heritage in the company’s press office in Sweden, who added that he did not know what else was included in the deal. The Swedish government was also unable to say what else was included.

Fröberg said the sale of the Volvos was insured through the Swedish Export Credit Agency, or EKN. “When North Korea failed to pay for the cars, EKN stepped in, meaning that Volvo Cars did not suffer financially,” he said. “The deal was closed from our point of view.”

But not for EKN, which twice a year reminds North Korea of its outstanding balance.

“For the most part, we get no response,” Carina Kemp, the EKN press manager, told VOA’s Korean service. However, “EKN’s position is that claims will be recovered.”

Many of the Volvos remain in service, as shown by an October 2016 tweet from the Swedish Embassy in Pyongyang describing “one of the Volvo’s from yr 1974 still unpaid for by DPRK.”

Sweden and North Korea have a long-standing relationship. It was the first Western European nation to establish diplomatic relations with Pyongyang; two years later, in 1975, it was the first to set up an embassy in Pyongyang.

Expanding relations

At the time, North Korea was expanding economic relations with the West. “In 1972-1973, before the global oil crisis, the prices of gold, silver, lead, zinc and other export items of North Korea were rising and Pyongyang must have been confident of its payment capabilities,” said Yang Moon-soo, professor of North Korean economy at the University of North Korea Studies, in the March 2012 issue of the KDI Review of the North Korea Economy, which is published by the Korea Development Institute, a think tank run by the South Korean government.

North Korea, after noting South Korea’s economic development through introduction of Western technologies, decided “to spur development with large-scale buildup of manufacturing plants with Western equipment and financing,” he said.

Of the 16 countries that owe a total of $729 billion to Sweden, North Korea’s share accounts for 45 percent, according to the EKN Annual Report 2016. Cuba, which is the next largest debtor, owes $225 billion as of December 2016 and began making payments that year, the EKN report shows.

Experts on sovereign debt told VOA there aren’t many ways for nations to recover what they are owed by cash-strapped North Korea.

“No payment has been made since 1989,” Katarina Byrenius Roslund, deputy director of the Swedish Foreign Ministry’s press office, told VOA in an email.

“This is the largest claim that Sweden has on a single country,” Roslund wrote. “Responsibility for the claim now lies with the Swedish Export Credits Guarantee Board, which sends a reminder to North Korea every six months.”

Roslund said the Volvos “are no longer a common sight on Pyongyang’s streets, but the odd Volvo 144 is still rolling down the country roads, often as a taxi.”

Paths to spare parts

Volvo’s Fröberg said he did not know whether the original deal included spare parts for the cars. But because the model purchased in bulk by North Korea, the 144, “was sold all over the world, they might have had their ways to get hold of parts through various channels.”

North Korea owes money elsewhere in Europe. The Swiss government reports it has claims for $241 million as of December 2016. North Korea owes Finland and private Finnish businesses more than $35 million, according to a YLE Uutiset report. Pyongyang “ordered paper machines and other assorted equipment” in the 1970s, according to YLE.

Isabel Herkommer, media spokeswoman at Switzerland’s State Secretariat for Economic Affairs (SECO), told VOA via email that “Swiss Export Risk Insurance (SERV) has an agreement with North Korea, which exempts the country from payment at the moment.”

According to the SERV Annual Report 2016, the agency signed a new restructuring agreement with North Korea in October 2011. Herkommer wrote that “there has not been a debt settlement with North Korea,” and when asked whether the Swiss government considered waiving all or part of the debt owed by North Korea as Russia recently did, she said, “No, this has not been considered.”

Outi Homanen of Finnvera, Finland’s export credit agency, said “that although the debts were not paid [on] original due dates, there are no defaulted receivables at the moment.”

However, experts on sovereign debt and the international monetary system say that there aren’t many ways for countries to recover their claims from North Korea. In 2014, Russia forgave 90 percent of the nearly $11 billion in debt that it and the Soviet Union before it was owed by North Korea.

“International debt is typically thought of as having two enforcing mechanisms. The first is that if a country wants to be able to borrow more, it has to be repaying or have repaid its previous debts,” said Dane Rowlands, a professor of international affairs at Carleton University’s Norman Paterson School of International Affairs in Ottawa, Ontario. “Since North Korea seems happy not to engage officially with the international community and capital market, cutting them off is not a useful enforcement tool.”

Asset seizure

He added that seizing exposed assets is another option for lenders but one that would not be effective against North Korea.

Hamid Zangeneh is an economics professor at Widener University in Chester, Pennsylvania. An expert in the debt of economically developing nations, he said that in North Korea’s case, “it really doesn’t matter because it is not part of the international monetary system.”

Rowlands speculated that Switzerland and North Korea might have made a deal when they signed the debt restructuring agreement in 2011.

“Given the relatively few channels of international finances that North Korea has access to, I could see them doing a deal with Switzerland saying we [North Korea] will pay back a portion of the debt. … What that would end up doing is Switzerland forgives the rest of the debt and they don’t have claim on seizing North Korean deposits for example,” he said.

According to the SERV 2016 report, the Swiss agency had claims of 179.1 million Swiss Francs ($210 million) with North Korea as of the end of 2016. However, the report says the claims have been reduced to 17.9 million Swiss Francs ($21 million), or about 10 percent of the original claim.

SECO’s Herkommer said, “There has not been any debt cancellation. We cannot make any further comment.”

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US House of Representatives Approves a $4T Fiscal 2018 Bill

The U.S. House of Representatives Thursday approved a $4 trillion fiscal 2018 budget blueprint, a major step forward toward the introduction of a Republican tax cut bill.

The measure narrowly passed (216-212) despite last-minute resistance from the ranks of Republicans.

House passage makes enactment of an eventual tax bill more likely in the Senate, although decisions on numerous thorny issues lie ahead.

Approval of the budget resolution was a victory for President Donald Trump and Republican congressional leaders, who have vowed to rewrite the tax code, a feat that has not been accomplished in more than four decades.

“President Trump has always made cutting taxes for hard-working American families, creating more jobs for American workers, and simplifying the rigged and burdensome tax code a priority, and he looks forward to further cooperation with Congress to advance the Administration’s pro-growth and pro-jobs agenda,” the White House said in a statement.

Democrats oppose plan

The Republican plan is opposed by Democrats, who contend it would benefit primarily the wealthy and corporations.

“The struggle Republicans had in passing the budget shows how uncomfortable many of them are with eliminating the state and local deduction. In the weeks ahead, Democrats will do everything we can to preserve it and work to defeat any tax proposal that favors the wealthy few over the middle class many,” Senate Minority leader Chuck Schumer said in a statement.

 

 

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Ashley Judd Says A ‘Deal’ Helped Her Flee from Weinstein

Actress Ashley Judd says she escaped Harvey Weinstein’s sexual advances by making a deal.

She says she told him, yes, she would submit to him only after winning an Oscar in one of his movies.

 

Then she says she fled from his hotel room where, two decades ago, she had arrived as a young actress for what she thought would be a business meeting.

 

Appearing on Thursday’s “Good Morning America,” Judd says she remains of two minds about how she handled the confrontation. She says she feels ashamed. She also credits her snap decision as brilliant.

 

Judd was among the first of what has become dozens of women alleging sexual harassment or assault by Weinstein, who is now under criminal investigation for rape in London, New York and Los Angeles.

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AP Source: Drake Did Not Submit Latest Album to Grammys

Drake’s “More Life” album won’t earn him more Grammy Awards: The rapper didn’t submit the album for consideration at the 2018 Grammys.

 

A person close to the nomination process, who spoke on the condition of anonymity because the person was not allowed to publicly talk about the topic, said the multi-platinum rapper did not submit “More Life” for album of the year or best rap album. The person also says Drake did not submit any of the songs from the album.

 

Drake has described “More Life” as a mixtape and playlist. Despite that, the album has sold more 2 million units and includes the Top 10 hits “Fake Love,” “Passionfruit” and “Portland.”

 

Representatives for Drake and the Grammys did not respond to emails seeking comment.

 

 

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Twitter Surprises With Third Quarter Earnings

Twitter is reporting a loss of $21.1 million in its third quarter, but turned in a better-than-expected profit when one-time charges and benefits are removed.

 

Shares of Twitter Inc. soared almost 9 percent before the opening bell Thursday.

 

The San Francisco company had a loss of 3 cents, but a gain of 10 cents if those non-re-occurring events are removed.  That’s 2 cents better than industry analysts had predicted, according to a survey by Zacks Investment Research.

 

Revenue was $589.6 million in the period, in line with expectations.

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Twitter Toughens Abuse Rules – and now has to Enforce Them

Twitter is enacting new policies around hate, abuse and ads, but creating new rules is only half the battle – the easy half.

The bigger problem is enforcement, and there the company has had some high-profile bungles recently. That includes its much-criticized suspension of actress Rose McGowan while she was speaking out against Harvey Weinstein, and the company’s ban, later reversed, of a controversial ad by a Republican Senate candidate.

 

The twists and turns suggest that Twitter doesn’t always communicate the intent of its rules to the people enforcing them. The company says it will be clearer about these policies and decisions in the future.

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Jessica Alba Reveals She’s Expecting Her First Baby Boy

Jessica Alba and husband Cash Warren are expecting their first baby boy.

 

The actress and Honest Company founder announced her pregnancy on Instagram in July and revealed on the platform Wednesday that the baby is a boy.

She chatted about her pregnancy later with Jimmy Fallon on “The Tonight Show.” Alba told Fallon she’s been trying to resist cravings for ice cream.

 

Alba and Warren have two daughters, Honor and Haven.

 

Alba most recently appeared as a judge alongside fellow actress-turned-entrepreneur Gwyneth Paltrow on the Apple Music summer series “Planet of the Apps.”

 

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Young Scientist Invents Device that Detects Lead in Water

What looks like clean drinking water can contain harmful chemicals, like lead, and there is no easy, reliable way to detect it. So, a young scientist invented one, in the process, winning the 2017 Discovery Education 3M Young Scientist Challenge. Faith Lapidus reports.

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Lung Transplant Recipient Singing Again

The extent to which organ transplants can allow recipients to not only survive but thrive was on display this week at a medical conference in the U.S. A former opera singer who received a double lung transplant five years ago returned to the stage, to sing with her donor’s daughter. VOA’s Kevin Enochs reports.

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Ancient Origami Art Becomes Engineers’ Dream in Space

Robert Salazar has been playing with origami, the Japanese art of paper folding, since he was 8 years old. When he sees a sheet of paper, his imagination takes over and intricate animals take shape.

“Seeing the single uncut sheet, it has everything you need to create all of the origami that have ever been folded. It is all in the single sheet so there is endless potential,” Salazar said.

The endless potential of origami, folding a single sheet of paper into an intricate sculpture, reaches all the way to space.

Salazar’s 17-year experience with origami is appreciated at NASA’s Jet Propulsion Laboratory. As a contractor and intern, Salazar is helping create objects that may one day be used in space exploration.

“Origami offers the potential to take a very large structure, even a vast structure, and you can get it to fit within the rocket, go up, then deploy back out again. So it greatly magnifies what we are capable of building in space,” Salazar said.

Folding a large object into a relatively small space is not a simple task.

“A big challenge in origami design in general is that because all of these folds share a single resource, which is a single sheet … everything is highly interdependent, so if you change just one feature it has an impact on everything else,” Salazar said.

“One of our guide stars really is keep it as simple as can be,” said Manan Arya, a technologist at NASA’s Jet Propulsion Laboratory. “Don’t add unnecessary complexity because every piece of complexity, every piece of hardware you add, that ends up being another potential point of failure.”

Starshade

Folding an object the size of a baseball diamond so that it could fit into a rocket is the goal of a NASA project called Starshade.

Once it opens in space, Starshade would allow a space telescope to better see the planets around bright stars.

“Seeing an exoplanet next to its parent star is like trying to image a firefly next to a search light, the searchlight being the star,” said Arya, who is  working on the Starshade project. “Starshade seeks to block out that starlight so you can image a really faint exoplanet right next to it.”

Origami robot

Origami is also used in designing a robot called the Pop-Up Flat Folding Explorer Robot, or PUFFER. It has a body that can fold itself flat and roll under small spaces. PUFFER has been tested on desert terrains and snowy slopes. It may one day end up on a mission to another planet.

 

“It [PUFFER] is to explore environments otherwise inaccessible to a robot that could not fold itself to fit inside these cracks, [to] explore cave systems, could be other planets, even on our own,” Salazar said.

Origami antenna

Another application for space origami design is to pack an antenna into satellites the size of a briefcase, called CubeSats.

“The bigger the antenna you have, the more gain your antenna has, so it is useful to have a big antenna that gets packaged into this tiny space that unfolds out to be a large antenna. The biggest CubeSat antennas right now are about half a meter,” Arya said.

Unexplored territory

There are also largely unexplored surfaces that can utilize origami concepts in designing new technologies.

“So often, origami design has been tailored toward materials that are already lying flat,” Salazar said. “But there is actually a vastly, a much larger field of application for which the surfaces are not flat, so they could be parabolic. They could be spherical. They could be many combinations of doubly curved surfaces coming together. All of these things can also be folded.”

In the current origami-inspired technologies being developed at NASA’s Jet Propulsion Laboratory, there is a graceful beauty to the folding and unfolding of designs such as the Starshade, which unfurls into what looks like a sunflower. In origami, Salazar said, art, science and engineering are only superficially different.

“Really, when it comes down to it, you’re looking at the world,” he said. “You’re making observations. You’re finding patterns in these observations. [You’re] developing an understanding of what you see, then using that understanding to create. And when you’re creating, [it] can either be creating with the intention of solving a physical problem or it could be nonphysical. It could be aesthetic. You’re trying to find a particular impact on people when they see your work. So really, the practice is the same.”

In origami, Salazar said art, science and engineering are quite similar. They draw on making observations and creating something that produces an impact.

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Ancient Art of Paper Folding Becomes Engineers’ Dream in Space

Paper folding known as origami is widely considered a Japanese art form. From a single piece of paper, an animal, a flower or even a boat can take shape. Besides the fun and artistic side of origami, the art of paper folding also has applications that can take it to outer space. VOA’s Elizabeth Lee has the details from NASA’s Jet Propulsion Laboratory in Pasadena, California.

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Photography Exhibit Highlights Human Trafficking

“Sorry, I’ll try not to cry,” said Janine Tkach as she gazes at one of about two dozen photographic images displayed in Washington’s busy Dupont Circle.

The pictures depict men, women and children who were victims of trafficking, either as sexual or labor slaves. Along with quotes from each of the subjects, the pictures challenge passers-by like Tkach to imagine the daily horrors and desperation of the victims.

“I was aware of the problem before, but it kind of hits home when you see it so visually like this exhibition,” said David, a tourist from London who did not give his last name. “Obviously some of these traffic victims are exploited to make products cheap.”

​The Bought and Sold exhibit is part of ArtWorks for Freedom, a grassroots effort to raise awareness of a problem that seems unreal in the 21st century. The U.S. Department of State estimates between 600,000 and 800,000 people are trafficked across international borders each year. Millions more are enslaved within national borders.

Award-winning photographer Kay Chernush created the collage from her photos of trafficked persons.

“I was first introduced to the issue of human trafficking through an assignment I had for the State Department. This was back in 2005,” Chernush said. “I was sent to Hong Kong, Macau, Thailand, India and Italy to photograph all different kinds of human trafficking at that time.”

 

WATCH: Photography Exhibit Highlights Human Trafficking

Gripped by the human rights violations she saw, Chernush continued to work in different countries partnering with anti-trafficking NGOs. The first of her Bought and Sold exhibits was held in The Hague in 2009, before moving on to other cities in the Netherlands. That was the beginning of ArtWorks for Freedom. Since then, the exhibit has been shown in major cities in many parts of the world.

“If photography could be that powerful and not only in moving audience perceptions but also empowering survivors, why not bring in other arts besides photography?” asked Chernush.

Other artists join

Other artists joined the anti-trafficking campaign in their own mediums. Dance depicts the journey of trafficking victims from trauma to healing and recovery. 

“I think it makes a bigger impact through empathy. That’s what I’m trying to do with my dance piece,” said Erica Rebollar, director of Rebollar Dance. “It is to create an empathetic environment of the individual stories, and I think through that … that’s going to touch people even more than just reading dry facts.”

Rebollar choreographed part of a dance piece called “Strong in the Broken Places,” which was performed at the Dance Place in Washington D.C. as part of the campaign.

The Washington exhibit also presents art from migrant workers’ children and quilts made by trafficking survivors. Twelve golden doors transformed from battered wooden doors are a metaphor for reclaiming the victims’ lives.

“This is something that we can eradicate in our lifetimes, and everybody has a role to play,” Chernush said. “Everyone can do something.”

That message is not lost on Tkach, whose eyes well up as she studies the photographs in spite of her assurance she wouldn’t cry.

“I’m definitely glad I stopped,” she said. “And I hope that I’ll take more of this with me so that I can make a difference even if it’s just by abstaining from a practice or a clothing line or something that might actually hurt someone else.”

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A Tale of Tesla Seats Hints at Why So Few Cars Built

Elon Musk was fed up.

The seats on Tesla Inc’s new Model X SUV were a mess. An outside contractor was having trouble executing the complicated design, spurring frustration and finger-pointing between Tesla and its supplier.

How would Tesla ever pull off mass production of the upcoming Model 3, the car intended to catapult the niche automaker into the big leagues, if it could not deliver on something as fundamental as a seat?

Musk made a decision: Tesla would build the seats itself. 

But industry experts say Musk’s insistence on performing much of the work in-house is among the reasons Tesla is nowhere close to its stated goal of building 500,000 vehicles annually by next year, most of them Model 3s.

Missed target

The automaker this month revealed it built 260 of the vehicles between July and September, badly missing its target of 1,500 Model 3s in the third quarter. In a statement, Tesla blamed manufacturing “bottlenecks.” It declined to elaborate, but assured investors “there are no fundamental issues with the Model 3 production or supply chain.”

Tesla has demonstrated a commitment to vertical integration not seen in the auto industry for decades.

The company has so far sunk $2 billion into a sprawling Nevada factory to manufacture its vehicles’ batteries. In-house programmers design the bulk of the complex software that runs the Model 3, which Musk has described as a “computer on wheels.”

Tesla controls its own retail chain, selling its cars directly to customers and bypassing dealers.

But it is Tesla’s 2015 decision to build its own seats that has some industry veterans scratching their heads. Seat making is a low-margin, labor-intensive enterprise that big automakers generally farm out to specialists. Tesla is operating its own seat assembly line inside its factory, and it is hiring engineers and technicians to figure out a way to fully automate the process.

“Is that really the core competency of an auto company? It is not,” said analyst Maryann Keller, who has been tracking the car industry since the early 1970s. “Why would you want to do that?”

Tesla declined requests from Reuters to discuss its seat assembly efforts. The company is expected to reveal more about its production issues Nov. 1, when it announces third-quarter results. There is no indication that the “bottlenecks” mentioned previously by the company are associated with seat production.

Analyst Keller and others suspect Tesla eventually will be forced to farm out seat assembly to suppliers as the company transitions from a niche producer of pricey, hand-built luxury cars to a mass manufacturer. Seat makers including Germany’s ZF Friedrichshafen AG, France’s Faurecia SA and Detroit-based Lear Corp already are trying to win that business.

A lot is riding on Tesla’s ability to scale up operations quickly. Starting at $35,000, the Model 3 is Tesla’s attempt to bring its electric technology to a wider audience. 

More than a half-million customers have put down deposits.

Tesla has never turned an annual profit and it is burning through cash. Yet investors are betting big on its future. It is now the second most valuable U.S. automaker, behind General Motors Co. Tesla shares on Wednesday closed at $325.84, down 3.4 percent.

From stop-gap to strategy

Musk has defended Tesla’s hands-on approach as the way to ensure reliability, as well as an opportunity to rethink industry norms. It is also a reflection of the entrepreneur’s obsession with detail.

“One of the hardest things to design is a good seat,” Musk said at the September 2015 launch of the Model X in Fremont.

Problems first surfaced with the flagship Model S sedan in 2012. Musk complained that the seats made by its contract manufacturer, Australia-based Futuris Group, were not comfortable nor of the quality expected for a car whose price tag started at around $57,400, according to a former Tesla executive who described Musk’s thinking to Reuters.

Troubles accelerated with the Model X, leading Tesla to wrest assembly from Futuris just after the vehicle’s release in late 2015. If seats could be entirely redesigned from the ground up, Musk reasoned, maybe their assembly could be automated in preparation for the high volumes anticipated for the Model 3.

“He saw the opportunity to do it differently and better,” the former Tesla executive said. “The short term was a stop gap, but the long-term idea was to rethink the design of how a seat works to include how a seat is built.”

Futuris did not respond to requests for comment. It continues to supply seat parts to Tesla. Detroit-based seating supplier Adient PLC acquired Futuris for $360 million last month.

Meanwhile, Tesla’s seat woes continue. In all, the automaker has issued four seating-related recalls since 2013. The latest came this month with the recall of 11,000 Model Xs manufactured between Oct. 28, 2016 and Aug. 16, 2017.

Suppliers circling

Making car seats is a complex business. Choosing materials, dying and cutting, shaping foam and metal frames, and adding heaters, recliners and other gadgets can involve nearly a dozen suppliers for top models. Final assembly requires lots of labor.

That’s why most automakers opted decades ago to outsource seats for their lower-cost models to specialty seatmakers whose market is expected to reach $79 billion by 2022, according to market researcher Lucintel.

Although Musk’s philosophy has always been “build it right and then figure out how to get the cost down” later, according to the ex-Tesla executive, observers say Tesla can ill afford more production headaches. 

Philippe Houchois, an auto analyst, wrote in a September note to clients that “scalability” was now the main challenge at Tesla, whose manufacturing prowess is still unproven when it comes to building large numbers of vehicles.

Despite Tesla’s previous battles with Futuris, seat suppliers smell opportunity. ZF Friedrichshafen and Faurecia have opened Silicon Valley labs, in part to woo Tesla.

Lear, which cuts and sews material for Tesla, is likewise pressing to get the automaker’s seat manufacturing business, according to Matthew Simoncini, the company’s chief executive. “In general Tesla has a philosophy: ‘We’ll do it ourselves. We’ll change the mold,’” Simoncini said. “(Outsourcing) is a much more efficient use of capital. That would allow them to focus on what they do best.”

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Trump Orders Test Program for More Drones

U.S. President Donald Trump Wednesday ordered the Transportation Department to launch a test program to increase the number of drones for commercial and civil use.

“The program will help tackle the most significant challenges in integrating drones into the national airspace while reducing risks to public safety and security,” the department said.

Under the program, drones will be test flown at night, fly over people for safety tests, fly out of sight of the operators and deliver packages. It would also test technologies to prevent collisions with other aircraft. 

“Drones are proving to be especially valuable in emergency situations, including assessing damage from natural disasters such as the recent hurricanes and the wildfires in California,” Transportation Secretary Elaine Chao said.

A novelty for now

Right now, drones in the United States are largely a novelty. Federal aviation officials say there are about 1 million registered drones in the country. Most of them belong to people who fly them as a hobby.

They are small and relatively inexpensive and can be modified to deliver small packages and even pizzas.

But the lack of federal and local rules and safety regulations have restricted more widespread commercial use.

There is also the inevitable concern that drones could become a tool for terrorists.

Terrorist tool?

FBI Director Christopher Wray recently told a U.S. Senate panel, “The expectation is it’s coming here imminently.” He called drones “relatively easy to acquire, relatively easy to operate, and quite difficult to disrupt and monitor.”

A drone flown by a hobbyist unintentionally crash landed on the White House lawn in 2015.

Along with Wednesday’s announced test program, the Trump administration wants to enhance the powers of police to track drones and shoot down any that appear to be a threat.

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Ex-President George H.W. Bush Apologizes After Actress Accuses Him of Groping

Former U.S. President George H.W. Bush apologized through a spokesman on Wednesday for what an actress described as a sexual assault but which Bush said was intended as a friendly pat and a joke to put her at ease during a picture-taking session.

Heather Lind, who starred in the AMC cable television network’s historical drama “Turn: Washington’s Spies,” accused Bush of groping her as they posed for photos together with his wife and others during a promotional event for the show in 2014.

The allegation surfaced in an Instagram post from Lind featuring a photograph of Bush, 93, shaking hands with former President Barack Obama during an appearance of all five living former presidents at Saturday’s hurricane fund-raising benefit.

In the post, Lind, 34, said that seeing that photo reminded her of her own meeting with the 41st president three years earlier, when, according to her, “he sexually assaulted me while I was posing for a similar photo.”

“He didn’t shake my hand. He touched me from behind from his wheelchair with his wife Barbara Bush by his side,” Lind wrote.

“He told me a dirty joke. And then, all the while being photographed, touched me again.” Lind said the former first lady “rolled her eyes as if to say, ‘not again.'”

The Instagram post, since deleted, carried the “MeToo” social media hashtag spawned by the recent outpouring of sexual assault and sexual harassment accusations leveled against former Hollywood executive Harvey Weinstein. Weinstein has denied engaging in non-consensual sex with anyone.

Bush’s spokesman Jim McGrath, issued a statement in response to Lind’s post that sought to explain the former president’s behavior as an attempt to make light of social awkwardness posed by his own physical disability during photo sessions.

Confined to a wheelchair, as Bush has been for about the past five years, “his arm falls on the lower waist of people with whom he take pictures,” McGrath said.

“To try to put people at ease, the president routinely tells the same joke – and on occasion, he has patted women’s rears in what he intended to be a good-natured manner. Some have seen it as innocent; others clearly view it as inappropriate,” McGrath wrote. “To anyone he has offended, President Bush apologizes most sincerely.”

Representatives for the actress were not immediately available for comment on the president’s response to her allegations, and it was not clear what prompted her to take down the Instagram post in question.

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Giant Sequoia Doing Well 4 Months After Idaho Uprooting

A 10-story-tall tree moved two city blocks on giant rollers last summer has new growth and appears happy in its new location, a tree expert said Wednesday.

Tree mover David Cox of Environmental Design examined the 800,000-pound (363,000-kilogram) sequoia in Boise, Idaho, and pronounced the tree fit.

“She looks pretty good,” he said. “But it’s still too early to tell. You still need about two or three growing seasons to really say that she’s recovered. We’re not in any danger zone. We feel like the tree is still happy.”

Moving the tallest tree ever attempted by the company required cutting back the root system that’s now being monitored for moisture content with underground sensors at the tree’s new location on city property.

Three of the four sensors Cox examined indicated the root system was not getting enough moisture, so he ordered a water truck. One was already scheduled to visit once a week this winter, but hadn’t started.

An irrigation system that includes misting hoses at the top of the tree was recently turned off by city workers in preparation for winter, and the area dried out quicker than expected, Cox said.

Cox also said he’s a bit concerned about some broken bark and smoothed-over bark at the base that might have been caused by animals or vandals or somebody climbing. He said the bark is about 9 inches (23 centimeters) thick so the living part of the tree under the bark isn’t being damaged.

Naturalist John Muir, who played a key role in establishing California’s Sequoia National Park, sent the tree as a seedling to Boise more than a century ago. It was planted in the yard of a doctor’s home.

St. Luke’s Health System in June paid $300,000 to move Idaho’s largest sequoia — which are not native to the state — to make way for a hospital expansion. Cutting down the most notable tree in the city’s urban forest could have risked a public relations backlash, and the hospital has said it never considered that option.

The tree suffered at its old location because it was shaded by a tall building. Cox also said the building created a kind of wind tunnel that caused part of the tree to dry out and turn brown. But those needles have fallen off at the new location and have been replaced with green, healthy needles.

The tree’s future health is uncertain in its new spot next to one of the city’s busiest traffic routes and only about eight blocks from the city’s core downtown area.

“We’re in a new environment here, a little more open,” Cox said. “We don’t know if we’re going to be better off or worse off. Se we’re going to prepare for drying winds.”

Winter treatments

He prescribed treatments in November, December and January to spray the tree with a type of substance to prevent it from drying out in cold winter winds, likening the process to a person applying hand lotion to prevent skin from drying out.

“It goes on kind of oily and dries waxy,” he said.

The treatments will cost about $1,500 each. St. Luke’s spokeswoman Anita Kisee said she did not know if the company will pay, and Boise’s Parks and Recreation department did not immediately respond to a telephone message seeking comment.

Cox under the contract with the hospital is serving only as a consultant, but said the company could chip in to partially fund expenses.

Brian Jorgenson, a city forester, checks on the tree and neighbors also appear to be watchful. He said he was challenged once by someone wanting to know if he was supposed to be poking around under the tree.

“I think the tree looks better in its current location,” he said. “It’s a lot more visible than it used to be, and we’re proud to have it on park property now.”

Cox said he plans to make site visits in January and again in March or April to consider treatments for the growing season for the sequoia, which are known to live for several thousand years in the right conditions.

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Ivanka Trump Promotes Expansion of Child Tax Credit at Capitol

Ivanka Trump teamed up Wednesday with Republican legislators to try to ensure the tax overhaul package under construction on Capitol Hill includes an expansion of the child tax credit.

The White House adviser and presidential daughter, appearing at a Capitol Hill news conference with GOP lawmakers, framed the tax credit as crucial for working families.

“It is a priority of this administration and it is a legislative priority to ensure that American families can thrive,” she said.

Also attending were Republican Senators Marco Rubio of Florida, Mike Lee of Utah, Tim Scott of South Carolina, Shelly Moore Capito of West Virginia and Dean Heller of Nevada; and GOP Representatives Kristi Noem of South Dakota, Kevin Yoder of Kansas, Claudia Tenney of New York and Martha Roby of Alabama.

Rubio and Lee have worked closely with Ivanka Trump on the issue. Details are still being worked out, but Rubio and Lee would like to see the $1,000 credit doubled and made fully refundable.

The GOP tax plan would cut the corporate tax rate from 36 percent to 20 percent, reduce taxes for most individuals and repeal inheritance taxes on multimillion-dollar estates. The standard deduction would be nearly doubled, to $12,000 for individuals and $24,000 for families; the number of tax brackets would shrink from seven and the child tax credit would be increased.

Democrats and liberal family advocacy groups say the overall plan would provide limited benefits to low-income families while offering major cuts to the wealthy — and they say that any boost to the child tax credit must be viewed in that context.

Speaking to reporters earlier in the day, Rubio expressed optimism about the child tax proposal, saying the provision is needed because without it, people could “see a tax increase, which nobody around here is prepared to justify, because you can’t.”

Rubio praised Ivanka Trump, saying that “having the White House making it a priority of theirs has strengthened our chances.”

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