Day: April 9, 2019

Rob Garver contributed to this report

The top Senate Democrat says President Donald Trump’s picks to fill two vacant seats on the Federal Reserve Board are unqualified for the job.

Trump has nominated former pizza chain boss Herman Cain and conservative economic commentator Stephen Moore for the Fed — posts that need Senate confirmation. Both are strong Trump supporters.

“I don’t see the qualifications of Cain or Moore fitting in with the mission of the Fed, which is to conduct monetary policy and not be political,” Sen. Chuck Schumer said Tuesday.

Cain is best known as the former CEO of the Godfather’s Pizza chain and a failed 2012 Republican presidential candidate.

He had several top positions at the Federal Reserve Bank of Kansas City. But local Fed boards do not set monetary policy and do not have the global impact that the main Federal Reserve has.

Stephen Moore was a Trump campaign economic adviser and is a TV commentator and columnist for The Wall Street Journal.

Opponents to their nominations say they could compromise the Fed’s credibility as an independent policymaking body that responds only to economic trends, not politics.

Chief White House economic adviser Larry Kudlow told CNN television that Cain and Moore are both “very smart people” and said Trump has “every right to put people on the Federal Reserve board … who share his philosophy.”

But Cain has faced charges of sexual harassment, which he denies, and Moore owes more than $75,000 in back taxes. He was once found in contempt of court for failing to pay $300,000 in alimony and child support.

Senate Republican Leader Mitch McConnell has not commented on the qualifications of either man, only saying “We’re going to look at whoever the president sends up.”
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China and the European Union agreed Tuesday to strengthen their trade relationship, pledging to work toward making it easier for foreign investors to get access to China, the world’s second biggest economy.

In a joint statement, the two sides said they committed to widening market access and eliminating discriminatory requirements for foreign companies and agreed that businesses should not be forced to transfer their technology — issues that foreign investors in China have long complained about.  

EU leaders Donald Tusk and Jean-Claude Juncker and Chinese Premier Li Keqiang discussed the issues at their summit before claiming a breakthrough in their trade relationship.

“Negotiations have been difficult but ultimately fruitful,” Tusk said.” We managed to agree a joint statement which sets the direction for our partnership based on reciprocity.”

The stakes at the annual summit were high, with two-way trade between the EU and China worth around 575 billion euros ($648 billion) annually. The EU is China’s biggest trading partner, while for the EU, only the United States is bigger.

The EU and China also said they reaffirmed the “rules based multilateral trading system” with the World Trade Organization at its core and plan to intensify discussions aimed at beefing up international rules on industrial subsidies.  

China wants a bigger role in the WTO and other international organizations like the United Nations and the International Monetary Fund. But China’s ample financial support for state-owned companies has been the target of Western trade officials. EU Trade Commissioner Cecilia Malmstrom has in the past called out China for “unfair trade practices” including government subsidies intended to give its companies a competitive advantage.

The summit statement shows “China is willing to make some concessions and that’s important,” said Mikko Huotari, deputy director of the Mercator Institute for China Studies, a Berlin-based think tank. The promises don’t mean China will quickly transform from a state-led economy into a market driven one, but “it’s about getting back on track with regard to reform promises and ambitions that the Chinese themselves have expressed,” he said.  

The leaders discussed China’s policy of forcing foreign companies to turn over intellectual property as a condition for access to its big and growing market — an issue that Washington has also made a centerpiece of its trade dispute with Beijing.

In their closing statement, they said: “Both sides agree that there should not be forced transfer of technology.”

The EU in December stepped up a WTO legal challenge filed in 2018 against China’s forced tech transfers, calling it a major issue affecting European companies.

Li strongly denied that Beijing is behind industrial espionage, saying the government has never called on Chinese companies to infringe intellectual property rights or steal trade secrets.

The EU’s executive Commission said last month in a strategy report that China was a “systemic rival” which preserves its domestic markets for national champions while placing “onerous requirements” on EU companies doing business there.

Li said after the summit that will change.

“We will not treat EU companies, especially those registered in China, with discriminatory policy, including solely foreign-owned companies in China,” he said. “And likewise Chinese companies should not be discriminated against in their operation in the European Union.”

The summit comes two weeks after Chinese President Xi Jinping agreed during a visit to Paris to work with European leaders to seek fairer trade rules.

 
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The first woman to head one of Bangladesh’s biggest garment associations said on Tuesday she would boost female leadership as most factory workers were women, amid scrutiny over safety.

Rubana Huq, 55, is managing director of Mohammadi Group, which owns a string of factories supplying brands like H&M and Primark in Bangladesh, the world’s second largest garment exporter, employing 4 million people.

“I believe that in an industry where more than 80 percent of the workers are women, they should be given a greater chance to voice their interests,” said Huq, the new president of the Bangladesh Garment Manufacturers and Exporters Association.

“Today, the workforce is largely women but people in the managerial levels are mostly men. That needs to change.”

In Bangladesh’s 4,500 factories, women have traditionally had to negotiate with male managers over pay, workplace safety and respect on the job, a fact Huq wants to change.

Her election comes at a time when Bangladesh’s Supreme Court is deciding whether to shut down a factory inspection mechanism which was set up by European fashion labels after the Rana Plaza factory collapsed in 2013, killing 1,100 people.

Huq said that manufacturers needed to strengthen their own monitoring mechanisms to help the government take over from the Bangladesh Accord – signed by about 200 major brands.

The textile magnate, who was elected unopposed, said her decision to represent manufacturers and exporters was a natural extension of her two-decade career in the industry, where she is one of a handful of senior female executives.

“As a woman there is always a hiccup and always a mindset to change,” she told the Thomson Reuters Foundation from Dhaka.

“But I’m here now and, being a woman, I believe my attitude towards the challenges faced by women workers will be different and more empathetic.”

Huq said she planned to educate women workers to secure their futures and step up to mid-managerial levels in factories.

“I would like to have a gender-based leadership program that ensures more women are empowered to take on these roles,” said Huq, who is also an award-winning poet and columnist.

She dismissed allegations of labor abuse in the industry as “isolated, negative practices”.

“The fact that 80 percent of our women are freely working and contributing to the economy is a much bigger narrative,” she said.

Labor rights campaigners said that while Huq had broken through the glass ceiling for women, her loyalties – as head of Mohammadi Group – were more to businesses than workers.

“Her election is good but I am not sure how much impact she will have in an organization that is still dominated by men,” said Nazma Akter, a former child worker and founder of Awaj Foundation, which campaigns for labor rights.

“I wish she would look at issues of living wages, health of workers, maternity benefits and violence in factories.”
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The International Monetary Fund is downgrading its outlook for growth in the United States, Europe, Japan and the overall global economy and points to heightened trade tensions as a key reason.

The IMF expects the world economy to grow 3.3 percent this year, down from 3.6 percent in 2018. That would match 2016 for the weakest year since 2009. In its previous forecast in January, the IMF had predicted that international growth would reach 3.5 percent this year.

For the United States, IMF economists downgraded their growth forecast for this year to 2.3 percent from 2.9 percent in 2018.

The IMF’s “World Economic Outlook” comes on the eve of meetings in Washington this week of the fund and its sister lending organization, the World Bank.

In Europe, the IMF expects the 19 countries that use the euro currency to expand 1.3 percent collectively in 2019, weaker than last year’s 1.8 percent growth or in any year since 2013.

Japan is expected to eke out 1 percent growth this year, up from 0.8% in 2018 but slightly down from the fund’s earlier forecast.

The IMF foresees the Chinese economy growing 6.3 percent this year, down from 6.6 percent in 2018. But the fund’s latest 2019 outlook was a slight upgrade from the 6.2 percent growth it had forecast for China in January.

China’s prospects brightened, the fund said, after President Donald Trump decided to suspend a planned increase in tariffs on $200 billion worth of U.S.-bound Chinese exports.

Still, the fund is expressing worries about tensions between the world’s two biggest economies, which have traded tariffs on hundreds of billions of dollars’ worth of products in a fight over China’s aggressive push to supplant American technological supremacy. The prospect of Britain’s messy departure from the European Union also weighs on the global economy.

The IMF expects growth in world trade to drop to 3.4 percent this year — a sharp slowdown from the 4 percent it had expected in January and from 3.8 percent trade growth in 2018.

 
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President Donald Trump says the United States will impose new tariffs on more than $11 billion worth of exports from the European Union, after the World Trade Organization ruled last year the EU was illegally subsidizing aircraft maker Airbus.

The WTO, in a decision last May, ruled the European countries had given $22 billion in state aid to Airbus to help build its A380 and A350 jets, damaging its U.S. rival, Boeing.

Trump said Tuesday that since the WTO had ruled that the subsidies had “adversely impacted the United States,” it “will now put Tariffs on $11 Billion of EU products! The EU has taken advantage of the U.S. on trade for many years. It will soon stop!”

Trump’s declaration aside, the new list of tariffs would not take effect until after a WTO arbiter rules on the allowable size of the tariff package, a decision not expected for several months.

The European Union and the United States have for years disputed each other’s reciprocal subsidies to Airbus and Boeing, long predating Trump’s 27-month presidency.  At various times, the WTO has ruled against both.

In first announcing the proposed $11.2 billion in U.S. tariffs on European exports on Monday, U.S. Trade Representative Robert Lighthizer said, “This case has been in litigation for 14 years, and the time has come for action.  Our ultimate goal is to reach an agreement with the EU to end all WTO-inconsistent subsidies to large civil aircraft.”

He added, “When the EU ends these harmful subsidies, the additional U.S. duties imposed in response can be lifted.”

The U.S. Trade Representative’s list of products subject to new tariffs extends to 14 pages, including a number of civil aviation products, including Airbus, along with new levies on such food products as swordfish, salmon, cheeses, olive oil and wines, and clothes.

The United States said once the WTO issues its report on the allowable size of the tariffs, it would issue a final list of affected goods.

The European Union and the United States have been working toward a new trade deal after Trump and European Commission President Jean-Claude Juncker agreed last July that no new tariffs would be imposed while the two sides are negotiating.

The ongoing dispute over aircraft subsidies is occurring as Boeing is facing a weeks-long crisis over the worldwide grounding of its fleet of 737 Max aircraft while authorities investigate the cause of crashes of the jetliner in Indonesia and Ethiopia that killed all 346 passengers and crew members aboard the two aircraft.

 
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It’s minus eight degrees Celsius on a late winter morning in western Massachusetts. But electrician Ed Martell is on the job, helping build an 8,000-panel solar farm outside the town of Wales, 110 kilometers southwest of Boston. 

Martell says solar installations have been going nonstop for the past several years. 

“I thought it was going to be a flash in the pan a couple years ago,” he told VOA. “I’ve seen solar keep going and going and going.”

Although sunshine is not the first image that comes to mind in connection with Massachusetts, policy decisions have propelled the state to third place nationwide in solar jobs, behind sunny California and Florida, which is known as the Sunshine State. 

Martell says the industry has been growing at a time when there has not been much other work for electricians. 

“If it wasn’t for solar, there would have been a two-year period when I wouldn’t have worked at all,” he added. “So, yes, it’s very good for us.”

Greenhouse gases

As the planet heats up, experts say the world needs to stop burning the fossil fuels that have powered civilization for centuries and switch to energy sources that do not release greenhouse gases that drive up the Earth’s temperature and produce weather extremes. 

The transition will not be easy. There will be winners and losers, economists say. 

The smokestack and the rusting remains of the 1960s-turquoise turbine are the last identifiable remains of the Mount Tom Station coal-fired power plant located 145 kilometers west of Boston in Holyoke, Mass. 

Former maintenance engineer Clancy Kaye kept the plant running for more than 30 years. 

But between expensive environmental upgrades, the plunging price of natural gas, and concerns from neighborhood groups about climate change and air pollution, the plant’s owners pulled the plug in 2014. 

They then built one of the largest solar farms with battery storage in New England just down the street.

Eighty people worked at Mount Tom at its peak. When it finally closed in 2014, the number was down to 28. Some of them retired. The company offered a generous severance package, Kaye said. But about a dozen employees had to take other jobs with 30 percent to 50 percent pay cuts and fewer benefits. 

“It’s been really a very rude awakening for many people who used to make some very good money. And some very highly skilled people,” Kaye said.

As coal-fired plants close across the country, he added, “the good jobs — and I mean good paying, good benefits, good pension — those jobs are virtually all going away for your average middle-class person.”

More than half of the 530 coal-fired power plants that were running in 2010 have shut down or plan to by 2030, according to the Sierra Club, an Oakland, California-based environmental group.

There have been losses in Massachusetts.

Winners in state policy

But experts say the state’s policies to fight climate change have created more winners. 

While Congress and the White House have feuded for years about what, if anything, to do, Republican and Democratic leaders in the Bay State have taken innovative steps to reduce greenhouse gases.

In 2008, Massachusetts was among the first U.S. states to set a greenhouse gas reduction target. By mid-century, the state aims to have cut emissions by 80 percent below 1990 levels. 

Accompanying legislation requires utilities to buy increasing amounts of renewable energy and charges power companies for carbon pollution. The state created aggressive programs to promote energy efficiency.

“Some detractors did say that this is going to turn the economy upside down, this is going to cost people more,” said Mark Sylvia, former Massachusetts energy resources commissioner. 

“But in fact,” he said, “it did the exact opposite.”

With a clear signal from the government, the market responded. Clean energy is now a $13 billion industry in Massachusetts. Its workforce has grown 84 percent since 2010. The sector now employs more than 110,000 workers, three percent of the state’s workforce.

In Washington, the climate debate is polarized between Democrats calling for an end to fossil fuels and Republicans saying these proposals will destroy jobs, when they acknowledge the problem at all. Only recently did Senate Majority Leader Mitch McConnell of Kentucky acknowledge that human activities are responsible for climate change. 

Climate policy

But Massachusetts’ Republican Gov. Charlie Baker took over from a Democrat, Deval Patrick, and held firm on climate policy. 

“In Massachusetts, climate change is not a partisan issue,” Baker told the House of Representatives Committee on Natural Resources in February. 

“While we sometimes disagree on specific policies,” he added, “we understand the science and know the impacts are real because we’re experiencing them firsthand.” 

Baker noted that since he took office in 2015, the state has suffered damage from record snowfall, record storm flooding and record drought. Rising temperatures have hurt the state’s winter sports industry and fisheries. 

“While many of these challenges are not new, they are more frequent and more damaging than ever,” he said. 

Baker’s position on climate change has evolved since his unsuccessful 2010 run for governor. At that time, he told The Boston Globe newspaper he was “not smart enough to believe that I know” whether humans were responsible for global warming.

But in his testimony, he called for a federal target for greenhouse gas emission reductions, a proposal congressional Republicans have repeatedly rejected. 

He noted that since the state set its target in 2008, “far from being an economic burden, we have seen close to a 70 percent increase over 1990 levels” in the state economy. 

Baker recently rolled out an updated incentive program for solar power and is planning major offshore wind installations that are expected to create 3,600 local jobs. 

And to pursue the jobs of the future, the state has provided more than $2 million in loans and grants to Greentown Labs, a business incubator for startups working on clean technologies. 

The growth will not help everyone, however. 

In the power generation business, “if you want to know where the jobs are, take an aerial view of the parking lot,” said Donnie Colston, head of the utility department at the International Brotherhood of Electrical Workers. 

A coal plant may have 150 to 200 cars in the lot, Colston said. 

Workers

But a solar farm? No parking lot. 

“We have members that will clean them, they’ll maintain them, they’ll make sure that they’re running properly,” Colston said. “But that’s not a full-time job.”

Environmentalists pushing to close coal-fired power plants are sympathetic to the threat of lost jobs.

From freshman Rep. Alexandria Ocasio-Cortez of New York to local Sierra Club chapters, activists are calling for a “just transition” for displaced workers in fossil fuel industries — job retraining and other measures to cushion the blow.

But the workers don’t want to hear it. 

“They want you to have a soft landing and a just transition,” said Kaye, the former Mount Tom coal plant worker, “but they have the saw in their hand that’s cutting the branch that you’re sitting on.”

Massachusetts closed its last coal-fired power plant in 2017. While the transition has been hard on many of his colleagues, Kaye is not bitter. He started a pool installation company that’s expanding. 

He said he always knew the plant wasn’t helping the environment. And change happens. 

“We used to say coal is king, King Coal. But it’s just not that way anymore,” he said. “And all in all, I think that’s probably a good thing.”
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