Day: December 11, 2017

Treasury Secretary Steven Mnuchin said Monday he is making a second emergency move to keep the government from going above the debt limit while awaiting congressional action to raise the threshold.

In a letter to congressional leaders, Mnuchin said he will not be able to fully invest in a large civil service retirement and disability fund. Skipped investments will be restored once the debt limit has been raised, he said.

In September, Congress agreed to suspend the debt limit, allowing the government to borrow as much as it needed. But that suspension ended Friday.

The government said the debt subject to limit stood at $20.46 trillion on Friday. Mnuchin has said he will employ various “extraordinary measures” to buy time until Congress raises the limit.

The Congressional Budget Office estimated in a recent report that Mnuchin has enough maneuvering room to stay under the limit until late March or early April.

If Congress has not acted before Mnuchin has exhausted his bookkeeping maneuvers, the government would be unable to borrow the money it needs to meet its day-to-day obligations, including sending out Social Security and other benefit checks and making interest payments on the national debt.

In August 2011, a standoff between Congress and the Obama administration over raising the borrowing limit came down to the wire and prompted the Standard & Poor’s credit rating agency to impose the first-ever downgrade of the government’s credit rating.

Raising the debt limit is a separate issue from the need for Congress to pass a spending bill to cover government operations. A failure to pass a spending bill triggers a partial government shutdown but does not carry the potential catastrophic market disruptions that a failure to raise the debt limit poses.

In his new letter, Mnuchin said, “I respectfully urge Congress to protect the full faith and credit of the United States by acting to increase the statutory debt limit as soon as possible.”
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The U.S. Supreme Court on Monday refused to hear an appeal by a Georgia security guard who said she was harassed and forced from her job because she is a lesbian, avoiding an opportunity to decide whether a federal law that bans gender-based bias also outlaws discrimination based on sexual orientation.

The justices left in place a lower court ruling against Jameka Evans, who had argued that workplace sexual orientation discrimination violates Title VII of the landmark Civil Rights Act of 1964.

Workplace protections are a major source of concern for advocates of rights for lesbian, gay, bisexual and transgender people.

Gregory Nevins, an attorney at Lambda Legal, an LGBT legal advocacy group representing Evans, said it was unfortunate the court turned away the case. Lambda Legal had cited language in the Supreme Court’s landmark 2015 ruling legalizing same-sex marriage nationwide to support their argument.

“The vast majority of Americans believe that LGBT people should be treated equally in the workplace,” Nevins said.

The case hinged on an argument currently being litigated in different parts of the United States: whether Title VII, which bans employment discrimination based on sex, also outlaws bias based on sexual orientation. Title VII also bars employment discrimination based on race, color, religion and national origin.

Lower courts are divided over the issue, making it likely the Supreme Court eventually will hear a similar case. In April, a Chicago-based federal appeals court found that Title VII does forbid job discrimination based on sexual orientation.

The U.S. Equal Employment Opportunity Commission, an independent federal agency that enforces Title VII, had argued since 2012, during Democratic former President Barack Obama’s administration, that bias against gay workers violates that law.

In July, Republican President Donald Trump’s administration argued the opposite in a separate case before a New York federal appeals court.

Evans in 2015 sued Georgia Regional Hospital at Savannah, a psychiatric facility, and several of its officials.

She alleged that while she worked there from 2012 to 2013, her supervisor tried to force her to quit because she wore a male uniform and did not conform to female gender stereotypes.

She said the supervisor asked questions about her relationships, promoted a junior employee above her, and slammed a door into her body.

In March, the Atlanta-based 11th U.S. Circuit Court of Appeals sided with the hospital, saying only the Supreme Court can declare that Title VII’s protections cover gay workers.

On Monday, a spokeswoman for Georgia’s attorney general, whose office represented the defendants, had no immediate comment.
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Free-trade talks between the European Union and South American trade bloc Mercosur still face hurdles over beef and ethanol, and an expected deal announcement this week might not happen, officials involved in negotiations said on Monday.

Mercosur diplomats involved in the talks on the sidelines of the World Trade Organization minister’s meeting in Buenos Aires said EU officials had not presented improved offers on EU tariff-free imports of South American beef and ethanol as promised.

“Basically, they want us to show our cards before they show theirs,” a senior diplomat from a Mercosur country told Reuters, asking not to be named due to the sensitive stage of the negotiations.

Resistance by some EU member states to agricultural imports, such as Ireland and France, has delayed negotiation of the free trade agreement with Mercosur that seeks to liberalize trade and investment, services and access to public procurement.

Brazilian President Michel Temer, speaking to reporters after attending the opening of the WTO meeting on Sunday, said an announcement of the framework political agreement for the

EU-Mercosur deal might have to wait until Dec. 21, when the bloc’s presidents meet in Brasilia.

A spokeswoman for the Argentine Foreign Ministry said agreement on the conclusion of the negotiations that have gone on for almost two decades could still be reached by Wednesday in Buenos Aires or, if not, next week in Brazil.

Besides disagreement over the tonnage of beef that EU countries would allow in each year free of tariffs, EU diplomats have said rules of origin still have to be included in the provisional political accord.

Brazil has said that can be worked out in the coming months before a final agreement is signed sometime in mid-2018. Brazil’s foreign ministry played down the hurdles to a deal.

“There is very little left to negotiate and they are not fundamental issues,” said an official, who requested anonymity. “There will be a deal and it will be announced when it is struck, here or in Brasilia.”

Mercosur members Brazil, Argentina, Paraguay and Uruguay are pushing for an improvement on the EU offer of tariff-free imports for 70,000 tons a year of beef and 600,000 tons of ethanol a year.

They complain that it is lower than the 100,000-tons beef offer the EU made in 2004, though EU negotiators say Europeans eat less meat today.

The Irish Farmers Association has called the deal “toxic” and opposes any increase.

 
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The European Union’s top five economies are warning the United States that its massive tax overhaul could violate some of its international obligations and risks having “a major distortive impact” on trade.

In a letter to U.S. Secretary of the Treasury Steven Mnuchin, the finance ministers of Germany, France, Britain, Italy and Spain wrote they had “significant concerns” about three tax initiatives in particular.

In the letter, seen by The Associated Press, the five wrote that “it is important that the U.S. government’s rights over domestic tax policy be exercised in a way that adheres with international obligations to which it has signed-up.”

EU nations have been warily eyeing President Donald Trump’s domestic tax proposals as they made their way through Congress and have long expressed fears they might hurt world trade and EU companies in particular.

“The inclusion of certain less conventional international tax provisions could contravene the U.S.’s double taxation treaties and may risk having a major distortive impact on international trade,” the five wrote.

They specifically targeted the so-called Base Erosion and Anti-abuse Tax (or BEAT) Senate bill. This measure aims to combat what is called base erosion and profit shifting, the practice by some multinationals to avoid tax by exploiting mismatches in countries’ tax rules to artificially report their profits in countries with low or no taxes.

The finance ministers lauded the measure’s aim to ensure companies pay their fair share in taxes to the U.S. But they said that under the current plans, the measures would also hurt genuine commercial deals. In the financial sector in particular, “the provision appears to have the potential of being extremely harmful for international banking and insurance business.”

They said it “may lead to significant tax charges and may harmfully distort international financial markets.”

The EU’s 28 finance ministers had already expressed concern about the U.S. plans during a meeting last week, but now its five biggest economies have gone ahead with their own warning.

In Washington, Republicans are upbeat about finalizing the tax bill from the House and Senate versions for Trump’s first major legislative accomplishment in nearly 11 months in office.

Trump has set a Christmas deadline for signing the bill into law, giving lawmakers named to a special conference committee two weeks to iron out major differences in the House and Senate versions of the legislation. The conference committee has scheduled its first formal meeting for Wednesday.

Both measures would cut taxes by about $1.5 trillion over the next decade while adding billions to the $20 trillion deficit, combining steep tax cuts for corporations with more modest reductions for most individuals. Together, the changes would amount to the biggest overhaul of the U.S. tax system in 30 years, touching every corner of society.
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Celebrity chef Mario Batali said on Monday that he has stepped away from his restaurant company and ABC said it asked him to step aside as co-host of a daytime food and talk show after he was accused of sexual harassment in a report by an online food trade publication.

Eater New York reported that four women, who were not identified, accused Batali of touching them inappropriately in a pattern of behavior that spanned at least two decades. Three worked for the chef during their careers, according to Eater New York.

Batali said in a statement emailed by his representative Risa Heller, “I apologize to the people I have mistreated and hurt. Although the identities of most of the individuals mentioned in these stories have not been revealed to me, much of the behavior described does, in fact, match up with ways I have acted.”

“That behavior was wrong and there are no excuses,” he said.

“I take full responsibility and am deeply sorry for any pain, humiliation or discomfort I have caused.”

Reuters could not independently confirm the accusations.

Batali said in the statement that he was stepping away from day-to-day operations of his businesses as he works to regain people’s trust and respect.

Batali’s reputation as a master of seasonal Italian food turned him into a restaurant executive, television star, cookbook author and one of the world’s most recognizable chefs.

He premiered on Food Network in 1997 on the show “Molto Mario” and in 2011 helped launch “The Chew” on ABC.

B&B Hospitality Group, which services about 24 restaurants owned by Batali and other chefs, said in an emailed statement that it takes such accusations seriously.

“We have had systematic policies and training about sexual harassment for over 10 years, including a detailed procedure for employees to report complaints to senior management,” B&B Hospitality Group said. “All members of management have participated in these trainings, including Mr. Batali.”

“Mr. Batali and we have agreed that he will step away from the company’s operations, including the restaurants, and he has already done so,” the company said in the statement.

The ABC Television Network, a unit of Walt Disney, said in a statement, “We have asked Mario Batali to step away from The Chew while we review the allegations that have just recently come to our attention.”

“ABC takes matters like this very seriously as we are committed to a safe work environment. While we are unaware of any type of inappropriate behavior involving him and anyone affiliated with the show, we will swiftly address any alleged violations of our standards of conduct.”

Food Network said in an emailed statement that it was suspending plans to relaunch “Molto Mario” in light of the accusations.
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U.S. President Donald Trump’s trade chief said on Monday that the World Trade Organization (WTO) is losing its focus on trade negotiations in favor of litigation, and was going too easy on wealthier developing countries such as China.

With Trump’s “America First” trade agenda casting a cloud over the WTO’s 11th ministerial meeting in Buenos Aires, representatives of other major members criticized protectionism and advocated a stronger multilateral trading system, while acknowledging the WTO’s shortcomings.

U.S. Trade Representative Robert Lighthizer, who has said he does not want major agreements out of the meeting, voiced concern that the WTO was becoming a litigation-centered organization.

“Too often members seem to believe they can gain concessions through lawsuits that they could never get at the negotiating table,” he said. “We have to ask ourselves whether this is good for the institution and whether the current litigation structure makes sense.”

Too many countries were not following WTO rules, he complained, and too many wealthier members had been given unfair exemptions as developing countries.

“We need to clarify our understanding of development within the WTO. We cannot sustain a situation in which new rules can only apply to a few and that others will be given a pass in the name of self-proclaimed development status,” Lighthizer told the conference’s opening session.

He said five of the six richest countries claim developing country status at the WTO, without providing evidence to back up the assertion. Of the countries with the six largest economies by Gross Domestic Product, according to the World Bank, only China claims developing market status.

Ahead of the meeting, the United States blocked efforts to draft a joint statement emphasizing the “centrality” of the global trade system and the need to aid development. Its opposition has raised concerns that the WTO will not be able to accomplish even modest goals, such as addressing fishing and agricultural subsidies, at the conference.

“We need to have a clear objective in mind,” European Trade Commissioner Cecilia Malmstrom said. “For the European Union, this is clear: to preserve and to strengthen the rules-based multilateral trading system.”

Swipes at China

Trump has indicated his preference for bilateral deals over the multilateral system embodied by the WTO. The United States has vetoed new judges for trade disputes, pushing the organization into a crisis.

On Monday, Lighthizer said it was impossible to negotiate new rules when many of the current ones were not being followed, and added that too many members viewed exemptions from WTO rules as a path to faster growth.

In a thinly veiled swipe at China’s trade practices, Lighthizer said the United States was leading negotiations to “correct the sad performance of many members in notification and transparency.”

The United States is backing the EU in its resistance to recognizing China as a market economy, arguing the government unfairly intervenes in the economy. The case, currently before the WTO, could lead to dramatically lower tariffs on imports of Chinese goods.

Chinese Commerce Minister Zhong Shan said on Monday that while trade protection was rising, no country would be able to succeed in isolation and that WTO rules were critical to protecting globalization.

“Let us join hands and take real action to uphold the authority and efficacy of the WTO,” Zhong said.
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Russia threw its weight behind China’s massive Belt and Road plan to build trade and transport links across Asia and beyond, suggesting to India on Monday that it find a way to work with Beijing on the signature project.

India is strongly opposed to an economic corridor that China is building in Pakistan that runs through disputed Kashmir as part of the Belt and Road initiative.

India was the only country that stayed away from a May summit hosted by Chinese President Xi Jinping to promote the plan to build railways, ports and power grids in a modern-day recreation of the Silk Road.

Russian Foreign Minister Sergei Lavrov said New Delhi should not let political problems deter it from joining the project, involving billions of dollars of investment, and benefiting from it.

Lavrov was speaking in the Indian capital after a three-way meeting with Chinese Foreign Minister Wang Yi and Indian Foreign Minister Sushma Swaraj at which, he said, India’s reservations over the Chinese project were discussed.

“I know India has problems, we discussed it today, with the concept of One Belt and One Road, but the specific problem in this regard should not make everything else conditional to resolving political issues,” he said.

Russia, all the countries in central Asia, and European nations had signed up to the Chinese project to boost economic cooperation, he said.

“Those are the facts,” he said. “India, I am 100 percent convinced, has enough very smart diplomats and politicians to find a way which would allow you to benefit from this process.”

The comments by Russia, India’s former Cold War ally, reflected the differences within the trilateral grouping formed 15 years ago to challenge U.S.-led dominance of global affairs.

But substantial differences between India and China, mainly over long-standing border disputes, have snuffed out prospects of any real cooperation among the three.

India, in addition, has drawn closer to the United States in recent years, buying weapons worth billions of dollars to replace its largely Soviet-origin military.

Swaraj said the three countries had very productive talks on economic issues and the fight against terrorism.
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Some women, and men, worry the same climate that’s emboldening women to speak up about sexual misconduct could backfire by making some men wary of female colleagues.

Forget private meetings and get-to-know-you dinners. Beware of banter. Think twice before a high-ranking man mentors a young female staffer.

“I have already heard the rumblings of a backlash: ‘This is why you shouldn’t hire women,’” Facebook chief operating officer Sheryl Sandberg wrote in a recent post .

“So much good is happening to fix workplaces right now. Let’s make sure it does not have the unintended consequence of holding women back,” said Sandberg, author of the working women’s manifesto “Lean In.”

Ana Quincoces, a Miami-based attorney and entrepreneur who owns her own food line, says her business and its success involves working mostly with men, and sales and other activities are often concluded over lunch or drinks. Those opportunities, she says, are dwindling, because many of the men she knows through her business “are terrified.”

“There’s a feeling of this wall that wasn’t there that is suddenly up because they don’t know what’s appropriate anymore — it’s disconcerting,” Quincoces said. “I feel that they’re more careful, more formal in their relationships with co-workers. And I can’t say I blame them, because what’s happened is pervasive. Every day there’s a new accusation.”

She said many of the men she knows are now avoiding one-on-one social occasions that were normal in the past.

“This is going to trickle down into all industries. … It’s going to become the new normal,” Quincoces said. “It’s a good thing because women are not afraid anymore, but on the other side, it’s a slippery slope.”

Americans were already edgy about male-female encounters at work: A New York Times/Morning Consult poll of 5,300 men and women last spring found almost two-thirds thought workers should be extra careful around opposite-sex colleagues, and around a quarter thought private work meetings between men and women were inappropriate.

But in a season of outcry over sexual misconduct, some men are suddenly wondering whether they can compliment a female colleague or ask about her weekend. Even a now-former female adviser to the head of Pennsylvania’s Democratic Party suggested on Facebook that men would stop talking to women altogether because of what she portrayed as overblown sexual misconduct claims.

Certain managers are considering whether to make sure they’re never alone with a staffer, despite the complications of adding a third person in situations like performance reviews, says Philippe Weiss, who runs the Chicago-based consultancy Seyfarth Shaw at Work.

Philadelphia employment lawyer Jonathan Segal says some men are declaring they’ll just shut people out of their offices, rather than risk exchanges that could be misconstrued.

“The avoidance issue is my biggest concern, because the marginalization of women in the business world is at least as big a problem as harassment,” Segal says. A recent report involving 222 North American companies found the percentage of women drops from 47 percent at the entry level to 20 percent in the C suite.

Vice President Mike Pence has long said he doesn’t have one-on-one meals with any woman except his wife and wants her by his side anywhere alcohol is served, as part of the couple’s commitment to prioritizing their marriage. The guidelines have “been a blessing to us,” the Republican told Christian Broadcasting Network News in an interview this month.

Employment attorneys caution that it can be problematic to curb interactions with workers because of their gender, if the practice curtails their professional opportunities. W. Brad Johnson, a co-author of a book encouraging male mentors for women, says limiting contact sends a troubling message.

“If I were unwilling to have an individual conversation with you because of your gender, I’m communicating ‘you’re unreliable; you’re a risk,’” says Johnson, a U.S. Naval Academy psychology professor.

Jessica Proud, a communications professional and Republican political consultant in New York City, said it would be wrong if this national “day of reckoning” over sexual misconduct resulted in some men deciding not to hire, mentor or work with women. She recalled a campaign she worked on where she was told she couldn’t travel with the candidate because of how it might look.

“I’m a professional, he’s a professional. Why should my career experience be limited?” she said. “That’s just as insulting in a lot of ways.”

 
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Yixuan Hao swirls the sparkling red in her glass and dips nearer to sniff. Throughout this frigid afternoon, she has been smelling and tasting wines from sunnier climates: Australia, New Zealand, South Africa, California. Perhaps soon, sooner than many people think, students like herself learning the wine trade here in Burgundy, will be sipping vintages from another New World upstart: China.

“It’s like a learning curve,” says Hao, 23, who comes from Xinjiang province, China’s biggest producer of wine grapes. “You need to learn from others who know better. But we’re trying to develop our own style, rather than copy the Bordeaux and the Burgundies.”

Welcome to the School of Wine and Spirits Business in Dijon, part of the Burgundy School of Business, where nearly one-third of the student body is from China. The nation that now dominates manufacturing of products ranging from wind turbines to smart phones is now turning its sights on oenology, and grooming a new generation to master it.

That includes here in France’s storied Burgundy winemaking region, where a patchwork of tiny vineyards, ancient villages and rolling hills have for centuries cultivated a particularly fierce love of terroir. The elusive term, capturing a particular land, climate and soil that helps define the identity of every wine, earned Burgundy a 2015 listing as a UNESCO World Heritage Site.

“They want to go back home with the best practices so they can produce the best wines they can,” says Director Jerome Gallo of students like Hao. “Probably not in one century, but in a decade or two, Chinese, some of them alumna, will be able to produce quality wines on a large scale.”

The school’s one-year master’s program teaches the fundamentals of the wine trade, from finance and management, to marketing, sales and negotiation. Many students are encouraged to take internships in France or overseas, including in their native countries. And despite tuition that can reach more than $15,000, there is no lack of Chinese applicants.

“Most of them go back to China after the program,” Gallo says. “Because it’s their home country and because there are a lot of things to develop there.”

Learning the trade

During an afternoon class on New World wines, students assessed the flavors and intensity of a parade of vintages, swirling and rising glasses, and puckering their cheeks as they tasted.

“You can smell blackberry, apple, orange,” says 21-year-old Lei Shi from northern China. “It’s magic.”

Shi hopes to land a job as an international wine buyer for a Chinese company after he graduates. But he is keenly aware that the other part of the equation, developing wine knowledge among consumers back home, remains a challenge.

“The wine culture in China is not very good,” he says. “Most people don’t know how to taste and enjoy wine. So we still have a long way to go.”

Yet the raw ingredients are there. China has the world’s second largest acreage in planted vineyards, behind Spain but ahead of France. While most of the cultivation is for table grapes, the domestic wine industry is growing rapidly.

Indeed, by 2020, China is expected to become the world’s second-biggest wine market, after the United States, according to International Wine and Spirit Research.

While the vast majority of wine consumed is domestically produced, faux Italian- and French-style chateaux are sprouting across the country, and a vast wine theme park opened this year in southeastern China, China is turning into a major wine importer.

“The new generation is more open to French culture and French wines than the old generation,” said student Hao. “Middle and upper classes want to consume wines from different regions, like Italy. For them, it’s a symbol of wealth and luxury.”

At La Route des Vins wine store, tucked in the ancient, cobblestoned streets of central Dijon, Adrien Tirelli describes Chinese visitors, like the Americans before them, arriving with guide books on what to buy.

“They tell me ‘I want this, this and this one, only the grand cru, only the best, only the most expensive,’” he recounts. “My job is to share my passion, and maybe suggest a lesser wine so they can develop their palates first.”

Buying French chateaux

Chinese are also snapping up French chateaux, mostly less expensive and prestigious ones, as promising investments. The favored target is the southwestern French region of Bordeaux, where more than 100 have been purchased in recent years, fueling fears among some of a Chinese invasion, even though the sales account for a tiny percentage of Bordeaux’s vineyards.

Burgundy, in east-central France, is also associated with luxury wines, but the region’s myriad vineyards and labels are a more difficult sell.

So far, only two Burgundy properties are in Chinese hands, according to Liu Yan, a local wine expert and Chinese tour guide based in the nearby wine city of Beaune.

One is Gevrey-Chambertin, a village in Burgundy’s celebrated Cote de Nuits wine region. When Hong Kong businessman Louis Ng bought a dilapidated chateau with two hectares of vines for a reported eight million euros (about $10 million) in 2012, he sparked local uproar. A group of locals banded together with an unsuccessful counteroffer, fearing a dilution of their patrimony.

But others applauded the sale, including Gevrey-Chambertin’s mayor, who noted no public funds were available to restore the ruin. The local tourist office took advantage of the media attention around the controversy to begin selling T-shirts proclaiming “In Pinot Noir We Trust,” Le Monde newspaper reported.

But tour guide Yan understands the local fears. She arrived in Burgundy more than a decade ago, studying wine in nearby Beaune. Unlike other Chinese students, she stayed.

“I love Burgundy, the simplicity of the people who are passionate about their work,” she says. “And especially this love of the land, people don’t want to lose it.”

Yan is confident her native China will someday be another major wine heavyweight. But it cannot compete with Burgundy.

“Every wine represents a terroir,” she says. “The land isn’t the same. The environment, the earth, all that doesn’t produce the same kind of wine.”
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Brazilian President Michel Temer said a key vote on a bill streamlining the social security system could be delayed to early 2018 as the government struggles to gather support among lawmakers.

Speaking to journalists in Buenos Aires on Sunday, Temer said he was confident that the bill, seen as crucial to reining in government debt, would pass a lower house vote this year but negotiations will continue even if does not.

“If it’s not this year, it will be in the beginning of next year,” Temer said, according to a transcript of a news conference.

His remarks struck a more flexible tone than his statements last week, when he said he would not even consider delaying the vote to 2018. Presidential and congressional elections next year, seen as the most wide open in decades, could make it even harder for Temer’s administration to pass the unpopular measure.

Temer agreed with lower house leaders last week to vote on the constitutional amendment during the week of Dec. 18, the last before the Christmas recess. Approval in the lower house would send the reform to a final Senate vote.

The reform proposal seeks to increase the age at which Brazilians can retire and collect social security. It would also make pension payouts in Brazil, among the most generous in the world, more modest.
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