Work Labor & Asia in the News, Summer 2011

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Surge in Global Migration Expands Scale of an Aid Group’s Influence  “The migration group was formed in 1951 under a different name to resettle Europeans displaced by World War II. It had plans to quickly disband, but migration kept growing. Starting in the 1970s, it helped resettle 1.5 million Indochinese refugees, and brought home 218,000 workers during the first Persian Gulf war. In the past two decades, the group has added 89 member countries and undertaken increasingly varied work.  Canada tapped it to recruit meatpackers. Britain used it to screen would-be migrants for tuberculosis. The United States used it to run a jobs program in Haiti, deterring Haitians from illegally immigrating.  ‘If the range of our activities has expanded, it’s because migration has taken on much more importance in our globalized world,’ said Gervais Appave, a senior official at the group’s headquarters in Geneva.  But the movement of people causes more concern than the movement of money or goods, and Western powers are unwilling to cede authority to an international group. While the World Trade Organization can define unfair trade practices, the migration group cannot define unfair migration policies. It cannot say who has the right to migrate or what rights a migrant should have.  Virtually all its work is financed on a project-by-project basis, giving donors control. Together, the United States and Europe provide half the $1.4 billion budget, and every director has been American.”
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Korean metalworkers organize Renault Samsung Motors  “2000 production workers and 500 white collar and maintenance workers in the factory in Busan in Korea belonging to Renault Samsung Motors decide to join IMF affiliate Korean Metal Workers’ Federation. The company totals 5650 employees, and has a production capacity of 300,000 vehicles per year.”
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In First, South Korea Votes on Social Policy  “‘This is the first time welfare has become a real issue,’ said Jaung Hoon, a political scientist at Chung-Ang University in Seoul. ‘It’s a sign that South Korean politics are moving finally toward policy debates.’  With increasing social mobility, regional affiliation has lost some of its potency as a vote-gathering tool. Politicians have sought other means to galvanize voters.  After 10 years in power, the liberals lost the 2007 presidential election to Lee Myung-bak, who attracted voters with the traditionally conservative values of economic growth, pro-business measures and a harder line toward North Korea. Then, in June last year, the liberal opposition made a surprising comeback in local elections by highlighting the need for a more comprehensive state welfare.  South Koreans used to depend on personal savings and family members for help in their old age or when jobless. But that tradition was shaken when the financial crisis of the late 1990s effectively ended guaranteed lifetime employment. Today, South Korea has one of the fast-growing rates of income inequality among the member countries of the Organization for Economic Cooperation and Development.”
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Foreign Students in Work Visa Program Stage Walkout at Plant “The arrangements that brought the foreign students to work at the Eastern Distribution Center III, a vast warehouse in a trim industrial park near Hershey, the American chocolate capital, involved layers of contractors.”
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Cooperation Is Emphasized as Biden Opens Talks in China “China has shown anxiety about the downgrade of the United States’ AAA credit rating by Standard & Poor’s and the potential effect on its investments. Yet it has joined other large investors in continuing to pour money into Treasury securities. The Treasury Department released statistics on Monday that showed that China increased its holdings of the securities in June by $5.7 billion, to $1.17 trillion. China is the largest foreign creditor of the United States.  On Monday, Lael Brainard, the undersecretary for international affairs at the Treasury Department, said in a conference call with reporters that ‘the economic side of the trip obviously is very important.’ But she emphasized that Mr. Biden would be trying to promote his country’s economic interests, noting that United States exports to China had grown faster than exports to other parts of the world, surpassing $100 billion over the last year. Mr. Biden plans to press China to continue letting its currency appreciate. Many economists say the renminbi is undervalued, giving Chinese exports an enormous advantage in the global marketplace.  Chinese leaders look more at domestic pressures when setting currency policy. They are trying to find the right balance between keeping the value of the renminbi low, which allows for stronger exports and thus more jobs in the manufacturing sector, and allowing it to rise enough to help tamp down inflation.”
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Humble Image of a Low-Key American Official Captives China  “A photograph taken last Friday of Gary F. Locke, the new United States ambassador to China, buying coffee with his 6-year-old daughter and carrying a black backpack at a Starbucks cafe in the Seattle airport, has gone viral on the Chinese Internet. The seemingly banal scene has bewildered and disarmed Chinese because they are used to seeing their own officials indulge in privileged lives often propped up by graft and bribery and lavish expense accounts.”
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Malaysia Looks West for Investments  “Appointed in 2009, Mr. Najib has initiated several economic plans to draw investment and address the lack of skilled workers in Malaysia, focusing on bolstering productivity and research, easing red tape for investors and improving inclusiveness.  The government is also seeking to fill its labor shortage by biometrically registering all workers and offering permits of a maximum 10 years for illegal workers.  ‘We’ll legalize them as workers, not as citizens; that would be a disaster,’ Mr. Najib said. ‘If all those things are executed, God willing, we will be a fully developed nation. It will give us 6 percent growth that we need for the next 10 years.’  According to the government, one million Malaysians live abroad, a sizable proportion of the country’s population of 28.7 million. Some estimates peg the number of Malaysian nationals based overseas much higher. Singapore has been the biggest beneficiary of the outflow, attracting more than half of those who have emigrated.  Mr. Najib also said rising wages in China could present an opportunity for Malaysia.  ‘More and more people are beginning to realize they need a ‘China plus one’ policy,’ he said, ‘They don’t want to put all their eggs in one basket.’  As a result, he said, ‘we’re seeing companies seriously looking at Malaysia.’”
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In Vietnamese Village, Stitching the Wounds of Human Trafficking  “Over a decade ago, human traffickers descended on this seemingly forgotten slice of soaring limestone crags and lush valleys to snatch up women and children and sell them over the border in China, less than four miles away.  The first predators arrived in Hop Tien in 2003, offering in seemingly innocent tones to buy some young women new shoes. Then the women disappeared. Soon others vanished too, all between the ages of 16 and 22, to be sold as wives, forced laborers or sex workers.  They were victims of a relatively widespread problem in Vietnam that included the abduction and trafficking of children as young as 5 or 6 years old, according to Matthew Friedman, the regional project manager for the United Nations Inter-Agency Project on Human Trafficking.  Between 2001 and 2005, the Chinese police say they rescued more than 1,800 trafficking victims on the Vietnam border, according to a 2005 State Department report on human rights. Since then, particularly over the last three years, Vietnam ‘has waged a significant and successful anti-trafficking campaign,’ Mr. Friedman said. But it still faces challenges, and trafficking in people remains a problem.”
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New Delhi Police Arrest Leader of Anti-Corruption Protest and Hundreds of Others “But he apparently had anticipated his arrest. Soon after his morning detention, a video appeared on YouTube, apparently filmed on Monday night, in which Mr. Hazare called on millions of Indians to rise up in nonviolent protest against corruption. In the video, Mr. Hazare said other leaders would guide such protests and spoke in sweeping, dramatic tones.”
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Protest Over Chemical Plant Shows Growing Pressure on China From Citizens “By the last available official count, so-called mass incidents — a term that appears to cover group actions ranging from minor work stoppages to serious riots — numbered 74,000 in 2004, up from 10,000 in 1993.  In a February article in Economic Observer, a Chinese weekly publication, Sun Liping, a sociologist at Tsinghua University, wrote that a government academy estimated that such cases had doubled between 2006 and 2010, reaching 180,000 last year.”
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After Riots, British Leaders Offer Divergent Proposals “Mr. Miliband spoke at his boyhood school in north London, a state school in a working-class neighborhood, as if to accentuate his differences with Mr. Cameron, who had attended the exclusive Eton College. He spoke derisively of the prime minister having chosen the ‘easy and predictable path’ by blaming ‘criminality, pure and simple,’ words Mr. Cameron used at the height of the looting and pillaging, and condemning him for suggesting, in reply to those who pointed to social deprivation as the cause of the disorder, ‘that to explain is to excuse.’”
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For Now, Germany Flies Above Economic Storm “The simplest explanation is jobs.  By one government measure, 706,000 more Germans were employed in May of this year than the year before, of which 415,000 were full-time positions and 289,000 part time. In terms of relative size, that would be roughly comparable in the United States to nearly 2.7 million more people with jobs in 2011 versus 2010.  With strong unions and legal protections for workers, Germany’s labor market for years was compared unfavorably with the more flexible American one. Even after embarking on painful reforms, it suffered from high structural unemployment. In July, German unemployment was 7 percent, compared with 9.1 percent in the United States.   As Germany’s population shrinks, some economists and policy makers are more concerned about a shortage of qualified workers than joblessness.  As for the young, the unemployment rate is the third lowest in Europe, behind only the Netherlands and Austria. Only 9.1 percent of people between the ages of 15 and 24 are unemployed here, less than half the 20.5 percent average in Europe.”
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What Is Business Waiting For?  “When the German economy turned south after the 2008 financial crisis, the pain was mitigated by a program known as ‘Kurzarbeit.’  The word means short work. Instead of laying off workers, German companies cut back their hours. The government then used money set aside during good times to pay the workers around 60 percent of their lost wages. The labor unions went along because they believed it was better to keep people employed even at reduced pay. This is the German social compact.”
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Cheap Robots vs Cheap Labor   “Workers in China’s export heartland of Guangdong make $200 a month assembling the consumer goods Americans hold so dear. In Jiangsu, they make $175. It seems that isn’t cheap enough.  Terry Gou, the founder and chairman of Foxconn, which employs one million workers in China making Apple iPads, H.P. computers and other electronic devices, announced at a company party in Shenzen last month that he would deploy a million robots at his plants by 2013 to do much of the labor currently performed by human hands.  It’s not only Foxconn complaining about expensive labor. Many companies have moved away from export hubs in coastal areas to regions like Chongqing, where workers are paid $135 a month. Others are going farther. Yue Yuen, the world’s biggest shoe maker, is setting up shop in Cambodia and Bangladesh.  Foxconn said it wants employees to move ‘higher up the value chain.’ Certainly, moving up the technology ladder drives economic development. The tractor and other farming inventions pushed millions of Americans off the farms. Computers displaced clerical workers. These breakthroughs created better-paid jobs for educated workers. But it’s unsettling to see cutting-edge labor-saving technologies deployed in a country where jobs must be found for some 300 million Chinese who live off the land.  Wages are rising, with salaries of many factory workers in China going up 20 percent to 30 percent annually. But that’s mainly because the new manufacturing jobs are far from where the underemployed farmers live. And the Chinese government doesn’t make it easy for workers to move from where they live to where they are wanted.  Even with this kind of wage pressure, pay is still very low. A Department of Labor study estimated that manufacturing workers in China earned $1.36 an hour in 2008 — about 4 percent of what an American worker made and less than wages in Mexico, Brazil, the Philippines and even India.  It’s hard to believe that hundreds of millions of Chinese can move quickly up the economy’s “value chain” to become tomorrow’s nurses and engineers. In the meantime, as robots take over more work, the millions trapped in the countryside will have even fewer opportunities.”

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The Age of Outrage “The fury in British cities follows huge social protests this year in Greece, where violence also flared, and in Spain, where tens of thousands have camped out from Madrid to Barcelona. Other nations, including Portugal, have seen a diffuse anger rooted in a shared conviction: things can’t go on like this. This European malaise is no stranger to a United States of high unemployment, economic bafflement, ideological radicalization and political pettiness.  Numbers tell part of the story. Youth unemployment in the 27-nation European Union stands at just over 20 percent, ranging as high as 45.7 percent in Spain. In Britain youth unemployment has risen from 14 percent in the first quarter of 2008 to 20 percent. About one in every five young Europeans and young Americans is wondering how to get any sort of working life on track. Britain’s NEETS (not in education, employment or training) meet U.S. boomerang kids in the anxiety of waiting.  The anxiety grows when governments are slashing benefits and pushing back retirement ages in an attempt to deal with spiraling deficits. A working gerontocracy hardly helps the young. Brits from Tottenham to Teesside have watched the most patrician cabinet since Macmillan cutting everything from libraries to youth counseling services. Theirs is a ‘No Future’ revolt.  A feeling has grown in Western societies that uncontrollable forces are at work shrinking possibility. History has never seen a global power shift as radical as the current one that managed to be peaceful.  The united Europe of today is built on the ashes of successive empires — from the Roman to the British — that ended in one form or other of violent convulsion. Now the American quasi-imperium, and more generally the dominion of the West, is ending, not rapidly but steadily.  Growth, jobs, expansion, excitement — and, yes, possibility — lie in the great non-Western arc from China through India to South Africa and Brazil. Go South! Go East! That’s the dictum of the age but not always practicable in Peckham or Peoria. The world has been turned upside-down. What we are witnessing is how shaken Western societies are by such inversion.  As new powers emerge, globalization has altered the relationship between capital and labor in the former’s favor. Many more cheap workers have become available outside the West as technology has eliminated distance. Returns on capital have proved higher relative to wages. That’s the story of the post-cold-war period. The gap between rich and poor has become a gulf.  The only people who walked away unscathed from the great financial binge that preceded this mess were its main architects and greatest beneficiaries: bankers, financiers and hedge-fund honchos.  This, too, is fueling a time of outrage that has left Western politicians chasing shadows.  Perhaps the society dealing best with these dilemmas is Germany. It has invested in a highly educated work force. It has matched workers’ skills to jobs. It has continued to make precision machinery others can’t make. It has fostered cooperation between labor unions and employers and between industrialists and the government in defense of German jobs. The youth unemployment rate is under 10 percent.  It has not tried to race to the bottom to compete with China, or imagined that financial and other services could sustain a society, or shirked on training, or tried to dismember unions, or believed that markets held all the answers. Past cataclysm has contributed to Germany’s ability to see past ego to the common good needed for stability.”
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A Theory of Everything (Sort Of) “So let’s review: We are increasingly taking easy credit, routine work and government jobs and entitlements away from the middle class — at a time when it takes more skill to get and hold a decent job, at a time when citizens have more access to media to organize, protest and challenge authority and at a time when this same merger of globalization and I.T. is creating huge wages for people with global skills (or for those who learn to game the system and get access to money, monopolies or government contracts by being close to those in power) — thus widening income gaps and fueling resentments even more.  Put it all together and you have today’s front-page news.”
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Landmark legal victory for Indonesian workers  “Indonesia’s National Court in Central Jakarta finds Indonesian President, Vice President, Head of Parliament and eight Ministers guilty of not implementing the Social Security law for the protection of workers”
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U.S. trade officials work toward resolution on labor law violations in Guatemala “U.S. trade officials said Tuesday they are moving forward with tougher actions to ensure that Guatemala enforces its labor laws under a free-trade agreement between the two nations.  U.S. Trade Representative Ron Kirk said the United States is requesting an arbitration panel be formed because of the ‘Government of Guatemala’s apparent failure to effectively enforce its labor laws’ as part of the Dominican Republic-Central America Free Trade Agreement (CAFTA-DR).  ‘With this case, we are sending a strong message that the Obama Administration will act firmly to ensure effective enforcement of labor laws by our trading partners,’ Kirk said in a statement. ‘While Guatemala has taken some positive steps, its overall actions and proposals to date have been insufficient to address the apparent systemic failures,’ he said.  ‘We need to see concrete actions to protect the rights of workers as agreed under our trade agreement, and we are prepared to act to obtain enforcement of those rights when and where necessary.’”
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Labor’s Decline and Wage Inequality “The decline in organized labor’s power and membership has played a larger role in fostering increased wage inequality in the United States than is generally thought, according to a study published in the American Sociological Review this month.  The study, “Unions, Norms and the Rise in U.S. Wage Inequality,” found that the decline in union power and density since 1973 explained a third of the increase in wage inequality among men since then, and a fifth of the increased inequality among women.  The study noted that from 1973 to 2007, union membership in the private sector dropped to 8 percent from 34 percent among men and to 6 percent from 16 percent among women. During that time, wage inequality in the private sector increased by more than 40 percent, the study found.  While many academics argue that increased inequality in educational attainment has played a major role in expanding wage inequality, the new study reaches a surprising conclusion, saying, ‘The decline of the U.S. labor movement has added as much to men’s wage inequality as has the relative increase in pay for college graduates.” The study adds that “union decline contributes just half as much as education to the overall rise in women’s wage inequality.’  The study was written by Bruce Western, a professor of sociology at Harvard University, and Jake Rosenfeld, a sociology professor at the University of Washington.  The two professors found that the decline of organized labor held down wages in union and nonunion workplaces alike. Many nonunion employers — especially decades ago, when unions represented more than 30 percent of the private sector work force — raised wages to help avert the threat of union organizing.  Moreover, the study argues that when unions were larger and had a far greater voice in politics and society, they played a more influential role in advocacy on wages across the economy, for instance, in pushing to raise the minimum wage.”
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Yingluck Shinawatra Is Elected Thai Prime Minister by Parliament “With the controversial legacy of Mr. Thaksin a boon and a potential barrier, Ms. Yingluck must deliver on her party’s litany of ambitious promises: a sharp increase in the minimum wage, the construction of high-speed rail lines, providing free tablet computers to primary school students and revamping the country’s health care system, among many others.  But her greatest challenge may be piecing together Thailand’s fractured society, a task that eluded the four governments that came after the 2006 coup.  Ms. Yingluck has repeatedly sought to assuage the Thai military, which had increased its political clout in the years following the coup.  Pheu Thai won the July 3 election thanks to strong support from the north and northeastern parts of the country, where Mr. Thaksin’s policies — universal health care, a crackdown on drugs and greater financing for local governments — proved very popular.  The losing Democrat Party is the party of the establishment — royalists, old-money business owners and high-ranking military officers — who have defended their place at the center of a traditional hierarchical system of power and wealth.”
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With Kiss-Ins and Dances, Young Chileans Push for Reform “If the Arab Spring has lost its bloom halfway across the world, people here are living what some have come to call a Chilean Winter. Segments of society that had been seen as politically apathetic only a few years ago, particularly the youth, have taken an unusually confrontational stance toward the government and business elite, demanding wholesale changes in education, transportation and energy policy, sometimes violently.  On Thursday, in one of the longest and most violent days of protests yet, high school and college students clashed with the police, who used water cannons and tear gas to disperse hundreds of demonstrators. By nightfall, tear gas blanketed pockets of Santiago, more than 500 people had been arrested, about half in the capital, and more than a dozen police officers and protesters had been injured. Demonstrators set up dozens of flaming barricades in the city, while people banged pots and pans outside their homes, in support of the student movement and decrying police repression.  ‘The whole country is watching this movement,’ said Eduardo Beltrán, 17, a student at Instituto Nacional, where the students have seized control of the school. ‘The generation of our parents,’ he said, ‘is watching us with hope, with faith that we have the strength to change this education system and make history.’  Even as Chile appears to the outside world to be a model of economic consistency and prudent fiscal management, there is deep discontent here with the neoliberal model and its economic consequences for those who are not part of the economic elite.”
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Officials Sent to Prison in Shanghai Tower Fire “A Shanghai court has sentenced nearly two dozen government officials, construction workers and contractors to jail for their role in a high-rise fire here that killed 58 people and injured 71 last November.  The highest-ranking official sentenced Tuesday was Gao Weizhong, the head of the construction authority in the district where the fire took place. He was sentenced to 16 years in prison for corruption and abuse of authority.The court said he had confessed to accepting bribes and steering construction contracts to unqualified subcontractors.  Huang Peixin, the owner of a company that was subcontracted to do renovation work on the 28-story high-rise, was also sentenced to 16 years in prison for accepting bribes and for his role in the fire.  Another construction company chief, Ma Yibang, was sentenced to 15 and a half years in prison for his role in the fire and for accepting more than $145,000 in bribes.  The court tried 26 people in the case last month. The vast majority of them received jail terms.  The fire was traced to workers who were welding using unsafe practices, and the netting and scaffolding encasing the building for the renovation caught fire. The fire led to a storm of criticism and anger because many older people and children were victims, and because fire trucks could reach only the lower floors of the building.”
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Skepticism Over India’s Anticorruption Bill “After a four-decade battle, Indian lawmakers took the first formal step toward creating an independent anticorruption agency on Thursday, introducing a bill in Parliament that would create a powerful ombudsman, or Lokpal, to investigate wrongdoing by Indian government officials.  But the draft of the law, which exempts the serving prime minister, members of Parliament and many other officials from the Lokpal’s jurisdiction, was roundly rejected by many of the activists who had fought for the creation of an independent agency to battle corruption.”
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Sonia Gandhi in the U.S. for Operation “Ms. Gandhi is deeply influential, especially on social policy. With the help of a quasi-governmental kitchen cabinet called the National Advisory Council, she has pushed expensive but popular social welfare programs that were a key factor in her party’s election victory in 2009.  In 2004, when she led the Congress Party to power after six years in opposition, she resisted calls to take the position of prime minister, choosing instead Mr. Singh, the soft-spoken economist who had ushered in economic reforms as finance minister in 1991.  Information about the lives of members of the Gandhi family is very tightly guarded, but Ms. Gandhi is not widely known to suffer from any major illnesses.  Her absence from India comes at a fraught time. The government is battling multiple corruption scandals and struggling to combat rising inflation and slumping economic growth.  Her son and heir apparent, Rahul, will lead the party in her absence along with three other senior Congress Party leaders, Mr. Dwivedi said.”
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Japan’s Prime Minister Sacks Three Nuclear Energy Officials “The sacking of the three officials is a highly unusual move in Japan, where elite career bureaucrats taken from the top universities have long been the nation’s de facto rulers. However, Mr. Kan has begun taking aim at collusion between government and the power industry in what many here see as a belated effort to prolong his stay in office.”
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The Strike That Busted Unions “More than any other labor dispute of the past three decades, Reagan’s confrontation with the Professional Air Traffic Controllers Organization, or Patco, undermined the bargaining power of American workers and their labor unions. It also polarized our politics in ways that prevent us from addressing the root of our economic troubles: the continuing stagnation of incomes despite rising corporate profits and worker productivity… Yet three decades later, with the economy shrinking or stagnant for nearly four years now and Reagan’s party moving even further to the right than where he stood, the long-term costs of his destruction of the union loom ever larger. It is clear now that the fallout from the strike has hurt workers and distorted our politics in ways Reagan himself did not advocate.  Although a conservative, Reagan often argued that private sector workers’ rights to organize were fundamental in a democracy. He not only made this point when supporting Lech Walesa’s anti-Communist Solidarity movement in Poland; he also boasted of being the first president of the Screen Actors Guild to lead that union in a strike. Over time, however, his crushing of the controllers’ walkout — which he believed was justified because federal workers were not allowed under the law to strike — has helped undermine the private-sector rights he once defended.”
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Brazil accuses 251 employers of slave-like labor “Brazil’s labor ministry says 251 employers are being charged with keeping workers in slave-like conditions.  The list of employers facing charges of slavery is released twice a year. The latest version was released Friday, and included two mayors. The number is up from 220 cases in December 2010.  The state of Para had the greatest number of cases: 62.  Brazil’s legal category of slave-like labor includes cases in which a person is subjected to exhausting hours or is forbidden to leave because of a debt with the employer.  The head of investigations for the ministry is Guilherme Moreira. He says names of employers are kept on the list for two years or until they pay all the fines related to the charges.”
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Automakers announce $19 bi investments in Brazil; country will be the world’s third-largest auto producer “Brazil’s automobile industry is booming. Investments in projects to expand existing plants and build new ventures are expected to reach $ 19 billion by 2017. Brazil’s production capacity will jump from the current 3.6 million units per year to 6.2 mi by 2025, according to estimates of Vanzolini Foundation, Sao Paulo. If the prediction is confirmed, the country will overtake Japan as the world’s third-largest auto producer, ranking  behind only the United States and China.  New manufacturers, mainly from South Korea and China, will play key roles in this development. Only in new factories, investments will amount to $ 5.22 billion, according to Brazilian magazine Istoé . The remainder, about $ 14 bi, will be mainly spent in the expansion of existing plants of Volkswagen, Ford, General Motors and Fiat.”
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China: Official Sentenced in Blaze That Killed 58 “The court convicted him of illegally granting a renovation contract to a company that subcontracted the work out to unqualified businesses, the official Xinhua News Agency said.”
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Global Concern Over U.S. Debt Ceiling Disagreement “China, which has the most to lose because it holds the largest amount of Treasuries — at least $1.16 trillion — offered a blistering attack on Washington on Friday, calling for a show of responsibility and an end to the partisan bickering.  ‘The ugliest part of the saga is that the well-being of many other countries is also in the impact zone when the donkey and the elephant fight,’ the state-run news agency, Xinhua — considered the propaganda arm of the Communist Party — said in an opinion piece Friday, referring to the standoff between Democrats and Republicans.  Xinhua said the ‘irresponsible’ brinksmanship in Washington risked “strangling the still fragile economic recovery of not only the United States but also the world as a whole.”
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Japan Proposes Aggressive Recovery Plan “According to the government plan released Friday, new spending will include money for new roads and ports, support for farming and fisheries in the region and help for small- and medium-size companies.  In particular, the plan would provide incentives for companies to rebuild their factories in the Tohoku region, a bid to stem a stream of companies that are moving their operations overseas. In helping to rebuild towns and villages along Tohoku’s ravaged coast, in northeast Japan, the government will work to support the region’s aging population, providing public housing to those who are unable to rebuild their homes, the plan said.”
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China Jails Journalist Who Reported on Corruption “Mr. Qi was originally detained after he wrote a series of articles in the state-run media detailing corruption among local party officials in the city of Tengzhou. The articles included an expose into the construction of a lavish government building and the beating of a female employee who was late for work.  Less than two weeks after the articles were published, Mr. Qi was detained by the police and, according to relatives, subjected to 11 months of physical and psychological abuse by members of the Tengzhou Public Security Bureau. They said his time in prison was marked by repeated torture, beatings by other inmates and hard labor in a prison coal mine.”
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Billionaires’ Rise Aids India, and the Favor Is Returned “Today, India is increasingly turning to the private sector to deliver the electricity needed to maintain rapid economic growth into the future. India’s economy is growing at more than 8 percent annually, but is badly constrained by an inadequate power supply after years in which the government dominated the power sector and failed to keep up with growing demand.  The rise of Mr. Adani attests to a broader shift, as the private sector is playing a greater role in areas once controlled by the state such as telecommunications, ports, airports, banks and infrastructure. At a global level, this contrasts sharply with China, where huge state-owned enterprises dominate strategic industries and lead the country’s global expansion. Mr. Adani recently had to outbid the Chinese for his Australian port.  Within India, though, the success of private tycoons has created a paradox: India’s moguls are essential to the country’s success and admired for their ability to get results. Yet their staggering wealth is made possible in part by their coziness with powerful politicians who help arrange environmental clearances, land use rights and other thorny issues. That raises accusations of crony capitalism.  India in the 21st century is now often compared to the United States during the Gilded Age of the late 19th century, when robber barons dominated the American economy. The country has 55 billionaires whose aggregate wealth of $250 billion is equivalent to almost a sixth of the nation’s annual economic output.  ‘No question, there is an oligarchy developing that has an enormous amount of influence,’ said Arvind Subramanian, an economic adviser to the Indian government. ‘That is a matter of great concern. But in India, these are also the guys who are performing. In some cases, they may be gaming the system, but they are also performing despite how bad the system is.’”
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Manufactured Goods Lead Surge in Indian Exports “But in fact, Indian exports of goods are now nearly double exports of services, growing 37.5 percent, to $245.9 billion, in the 12 months that ended in March. Leading the way are high-value products like industrial machinery, automobiles and car parts, and refined petroleum products.   Indian exports are following a different path from that taken by other Asian countries like Japan, Korea and China. Those countries started by exporting products like garments and toys made by large numbers of low-paid, low-skilled workers, before moving to more sophisticated products like cars and industrial machinery.  India has largely skipped the first step and gone straight to producing capital-intensive items that require skilled workers but not necessarily many of them. Rather than pursue the traditional developing-country model of exports, India aspires to eventually achieve something more like Germany’s mix of industrial goods for the global market — even if India has a long way to go before approaching Germany’s $1.3 trillion in annual exports.  Over the last decade, industrial export hubs have sprouted around India, some with the help of government planning. Here in Pune, about 100 miles east of Mumbai, a vibrant domestic automotive and engineering hub supplies the United States and other Western markets.”
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Is There Hope for the Unemployed? “Until now, the developed countries have tended to retain the steps that create high value added per employee and outsourced the rest to other countries. That practice naturally contributes proportionately more to  gross domestic product in the United States than to employment. Furthermore, it tends to yield high incomes to highly educated people and depress the wages of lower-skilled American  workers competing with foreign labor in the lower value-added segments of the value chain.  The Apple iPad, for example, was designed and developed by highly educated employees of Apple Inc. and is marketed by that company. But the device is assembled by the Taiwanese company Foxconn in its manufacturing plants in China, with components manufactured in South Korea, Japan and Europe.  It has been reported that of the retail price of an iPad of $499, Apple spends about $291 on components, typically produced in other countries. It retains a gross profit of about $208 per iPad, or about 42 percent of the retail price. Some of that gross profit covers marketing and administration; with worldwide sales, even those outlays produce jobs both in the United States and abroad.  Thus, the iPad adds proportionately much more to G.D.P. in the United States than to employment there. It supports some high-paying jobs in the United States, but few if any middle-income and lower-middle-income jobs in manufacturing. It shows that technical innovation in the United States is great and can contribute to the growth of G.D.P. per capita, but it may not offer Americans many jobs.” From Globalization and Unemployment:  The Downside to Integrating Markets in Foreign Affairs
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Train Wreck in China Raises Questions of Safety “A deadly train accident in eastern China has added to a national sense of unease that safety may have been sacrificed in the country’s rush to modernize.”
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Former China Mobile Official Sentenced in Bribery Case “Beijing is in the midst of a major corruption sweep ahead of a leadership change expected next year. In some cases, analysts say those charged with corruption may be singled out because of their relationships with high-ranking officials who are engaged in power struggles.”
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China: Reporting Team Disbanded “One of China’s leading investigative reporting teams has been disbanded because it focused too much on social ills, reporters in the team say. The China Economic Times five-person team was a rarity in China. It had tackled a variety of social problems, most recently for exposing how officials had covered up the distribution of fake vaccinations that had led to children’s deaths.”
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Chinese Upset Over Counterfeit Furniture “That same day, however, customs officials in Shanghai said they had evidence that DaVinci was temporarily storing Chinese-made goods in a Shanghai warehouse, including cattle-hide sofas produced in nearby Zhejiang Province. The officials said that after a day spent in Shanghai’s Waigaoqiao Free Trade Zone, the products — with the paperwork duly filed — were imported back into the country.  ‘Staying at the bonded zone for a day, the products changed from domestically produced ones to imported ones,’ Zhou Guoliang, a customs bureau official, told Chinese news media.”
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Thailand’s Irresistible Attraction for Fugitives “But what makes Thailand especially attractive, Mr. Burdett said, ‘is the international reputation, whether deserved or not, of a compliant and bribable police force.’  Thailand’s leaders have long acknowledged that there are bad apples — some would say orchards of bad apples — among the police.  Lt. Gen. Wiboon Bangthamai, the head of the country’s immigration police, said in an interview that officials at remote border posts had been known to suffer inexplicable computer troubles when cash-rich people sought to cross Thai borders illegally.  ‘Officers at small border checkpoints would break the computers and let them in,’ General Wiboon said.  The U.S. cables point to weak law enforcement, a country preoccupied with political problems and inconvenient geography.  ‘Thailand’s borders are long and extremely porous and the country is therefore vulnerable to international criminal elements of all kinds,’ said the cable from 2009. “
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U.S. trade deals could be delayed past August: Daley “Dark clouds were also building for the FTA in Seoul, where the main opposition party has taken another step toward blocking its ratification by listing a series of points it wants renegotiated.  The Democratic Party said the Lee administration had made too many concessions to Washington in last year’s renegotiated deal, but the ruling party vowed to push the deal through parliament in August.  Thousands of farmers took to Seoul’s streets last month saying the FTA will allow the entry of cheaper foreign farm produce.”
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Lee’s envoy to attend inauguration of Peru’s president “A senior South Korean lawmaker and brother of President Lee Myung-bak will visit Peru as a presidential envoy next week to attend the inauguration ceremony of Peruvian president-elect Ollanta Humala, the Foreign Ministry said Tuesday.  Rep. Lee Sang-deuk of the ruling Grand National Party will attend the ceremony on July 28, the ministry said in a statement. Humala won the presidential election last month.  During the visit, the envoy will deliver President Lee’s message to bolster bilateral economic relations, according to the statement.  After his visit to Peru, the presidential envoy plans to visit Bolivia and Ecuador, where business projects of developing lithium or building solar power plants will be high on the agenda, the statement said.  South Korea and Bolivia signed a deal last year to develop the world’s largest salt flats and lithium resources in the South American country, which boasts nearly half of the world’s known lithium reserves.”
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First NAFTA-Wide Union Could Emerge This Year “If the USW/Los Mineros merger passes, as many expect it will, it would be the first between a Mexican-based union, an American affiliate of a union and a Canadian affiliate of a union-marking a new phase of cross-border solidarity. The merger has the potential to reshape labor markets in both countries.  ‘We are directly affected everyday by the low-wage competition from Mexico. The reason that competition is low-wage is because Mexican government keeps wages low by bustin
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Room for Debate: The Texas Jobs Juggernaut Precarity and employment in Texas

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The Temp/ Contract Conundrum – Is non standard work the new normal in the US?

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How the Budget War Was Framed The progessive alternative in the deficit debate
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New Thai Government Is Delayed by Legal Challenges “‘There are potential feet on the street just waiting to be unleashed,’ said Kevin Hewison, a longtime observer of Thai politics and a professor at the University of North Carolina at Chapel Hill. ‘Thailand’s elite needs to make the historic compromise that is necessary for the country to be set on its path to democracy.’”
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Struggle intensifies at Hanjin shipyard in Korea “Some 10,000 people participated on July 9-10 in the “Hope Bus” march to the Hanjin shipyard in Korea to protest against dismissals in breach of their union contract. Riot police blocked and sprayed marchers with teargas fluid in spite of the fact that they had a permit and had informed the police of the march.”
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Report exposes exploitation in Chinese electronics industry “A recent China Labour Watch (CLW) report exposes appalling working conditions in ten Chinese electronics factories that supply products to multinational electronics companies such as Dell, Salcomp, IBM, Ericsson, Philips, Microsoft, Apple, HP, and Nokia.”
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What China’s five-year plan means for business: McKinsey analyzed the potential impact on 33 industries. Two dimensions stood
out: the plan’s effect on profit pools and on the competitive landscape.
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In India, Maids Need Protection and Respect “The platitude most commonly heard in India is that domestic workers are part of the family, which belies the depressing slew of stories about underpaid or physically abused workers. A 2005 National Human Rights Commission study and a 2008 study by the women’s support group Jagori have documented how this section of the Indian labor market is especially vulnerable to trafficking, financial and sexual exploitation and forcible confinement. The International Labor Organization estimates that there are at least 4.75 million domestic workers employed in private households in India, of which 3.4 million, or roughly 72 percent, are women. Until a few years ago, domestic workers in India had few rights and were poorly organized. For some, the sense of powerlessness is still strong.”
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Chavs: The Demonization of the Working Class “Mr. Jones’s book is a work of economics tucked inside what appears to be a volume of pop sociology. The meat of ‘Chavs’ is an attack on Mrs. Thatcher’s policies as prime minister: her administration’s destruction of unions, its raising of the tax burden on the poor, its allowing if not encouraging industry to fall into ruin. More recently, unemployment and the rise in casual and temporary labor — at supermarkets or call centers — have fed a sense of desperation. ‘In only a decade or so, Thatcherism had completely changed how class was seen,’ Mr. Jones writes. ‘The wealthy were adulated. All were now encouraged to scramble up the social ladder, and be defined by how much they owned. Those who were poor or unemployed had no one to blame but themselves.’ The author notes how demonizing the lower classes makes it easier to make policy against them. ‘To admit that some people are poorer than others because of the social injustice inherent in our society would require government action,’ he writes. ‘Claiming that people are largely responsible for their circumstances facilitates the opposite conclusion.’”
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British Distiller Diageo Shifts Its Focus in Acquisitions to Fast-Growing Markets Acquisitions and marketing investments shift growth focus to Asia and other emerging markets.
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Dissident Chinese Writer Flees to Germany “Of course, his escape — arranged by friends whom he declined to name — has not brought unadulterated joy. By fleeing his homeland, Mr. Liao, 52, made the difficult decision to abandon the wellspring of his work, much of it journalistic explorations of China’s downtrodden: the political outcasts, impoverished farmers, death row inmates and others who have been traumatized by famine and Communist-inspired zealotry, then cast aside during the nation’s manic embrace of material wealth and collective amnesia. He also leaves behind his family in southwestern Sichuan Province, including his mother, his son, two siblings and a girlfriend. ‘I’m trying to convince myself that I won’t be away from China very long, that things will change sooner than later,’ he said. In the West, Mr. Liao is best known for ‘The Corpse Walker: Real-Life Stories, China from the Bottom Up,’ which was banned in China soon after it was published in Taiwan in 2001. The book, a collection of interviews with people he encountered in prison and during wanderings in the southwest, tells the unadorned stories of 27 people, among them a public toilet attendant, a persecuted landlord, and the men, known as corpse walkers, whose job it is to transport the dead back to their hometowns for burial.”
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Sharing the Wealth and Living Large in a Tiny Chinese Village “If he is right, all 2,000 villagers will get a little richer. They all own a piece of the building — just as they own the town’s steel mill, textile factory, greenhouse complex, ocean shipping company and other ventures. That is Huaxi’s carefully curated narrative: by rigidly adhering to socialism with Chinese characteristics, the citizens of this little village have created an oasis of prosperity and comfort that is the envy of the world. When China effectively embraced capitalism in the 1980s, Huaxi was an agrarian hovel, reachable by dirt roads. Mr. Wu, then the local Communist Party secretary, seized on the new market freedoms to shift the Huaxi economy from farming to manufacturing and trade, but with a twist: the residents would throw their money into a collective pot and share in the take from whatever new businesses they bought. ‘In the 30 years after the opening up, the system changed in many places’ Mr. Wu’s son, Wu Xie’en, said in a recent interview. ‘Some chose private ownership, but we Huaxi people chose public ownership. The biggest benefit is that the people share the common prosperity.’ That Huaxi is prosperous seems undeniable. Here, the villagers get lavish annual stipends, live in spacious single-family homes instead of China’s usual cramped apartments, drive imported cars, and get basic medical care, education and even an annual vacation free from the government. Lately they also get free helicopter rides, courtesy of a 100 million renminbi, or $15.5 million, fleet of helicopters and small jets the village is buying to attract still more sightseers… While each villager is required to work at a Huaxi business seven days a week, virtually all the manual labor is performed by what Marx might have called the proletariat: thousands of outside workers, many of them migrants, who receive better salaries and benefits than many workers elsewhere, but do not share in Huaxi’s profits. For that, one needs a hukou, or residence permit — and Huaxi hands those out with great care. ‘This is called exploitation,’ said Fei-Ling Wang, a Georgia Tech professor who has studied Huaxi as part of research into Jiangsu Province villages. Because the outside workers, by law, cannot become a local resident. They cannot share the results of their works. And they are paid by wages, and if they lost their job, they are simply sent home. ‘If all migrant workers are treated as full members of the community,’ Professor Wang said, ‘then Huaxi wouldn’t work.’”
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Factbox-Policy Pledges of Thailand’s Incoming Government “Thailand’s Puea Thai (For Thais) Party, which won a landslide election victory this month, has pledged a range of populist measures, from wage increases to infrastructure projects to computers for school children. Below are key promises of the incoming government under Yingluck Shinawatra — Thailand’s first female premier and the sister of ousted Prime Minister Thaksin Shinawatra. However, she says she will be willing to drop policies if they are found unworkable.”
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Shares Needed as Cambodia Gets a Stock Exchange “Korea Exchange signed a venture agreement with the Cambodian government in March 2009 as part of wider plans to expand throughout the region. Keat Chhon, the country’s finance minister, will be the chairman of the Securities and Exchange Commission of Cambodia. So far only three state-owned enterprises have announced their intention to list on the Cambodia Securities Exchange: Telecom Cambodia, Phnom Penh Water Supply Authority and Sihanoukville Autonomous Port. Han Kyung-tae, managing director for Tong Yang Securities, which is preparing the initial public offerings for Telecom Cambodia and Phnom Penh Water, said the two companies still needed work to make sure they were compliant with market regulations. Mr. Han said the two were hoping to be ready to list by the end of the year at the earliest. SBI Phnom Penh Securities, which is preparing the initial public offering for Sihanoukville Autonomous Port, did not respond to requests for comment. Still, with the Cambodian economy having rebounded from a 2 percent contraction in 2009 during the global financial crisis to experience growth in gross domestic product of 6.7 percent in 2010, according to the World Bank, economists say the exchange could help bring more capital into the economy. In a country where the total number of loans in the banking system accounts for 30 percent of gross domestic product, compared with nearly 100 percent in Thailand and Vietnam, there is plenty of room for an influx of funds… Still, Cambodia has ranked near the bottom of Transparency International’s Corruption Perceptions index for years. And some people in Cambodia are all too aware of the risks that could come along with a stock market, saying that it could act as a tool to further benefit the country’s elite. ‘We live in a culture where there is no rule of law,’ said Tioulong Saumura, a lawmaker for the opposition Sam Rainsy Party and former vice governor of the National Bank of Cambodia. ‘No doubt it is easy to adopt a good regulation — copy it down yourself and come up with something on paper that looks good.’”
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A Japanese Legal Exam That Sets the Bar High “The time that Mr. Otsuka and thousands of other people are spending in preparations for taking the bar exam is understandable. Last year, only 2,074 people — or 25 percent of the examinees — passed, the lowest rate since officials began administering the new test in 2006. While the success rate is much higher than it was before the reforms, when 2 percent to 3 percent of test takers passed the bar, the creation of an entire system of graduate law schools has led to a new cadre of students who study law, spend years at school and pay millions of yen for tuition, only to fail the professional test.”
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Quick Action Helps Google Win Friends in Japan “The company has been in Japan for more than a decade, attracted by its huge market for online services, mobile technology and advertising. The Internet advertising market in Japan reached 774.7 billon yen ($9.6 billion ) in 2010, according to the advertising agency, Dentsu. Japan, too, has 99 million users of Internet-ready 3G phones, which is also second only to the United States. But Japan has been grudging in its acceptance of Google. At the end of December, Yahoo Japan, operated by the Japanese telecommunications giant SoftBank, accounted for 50.4 percent of all search page views, according to comScore Media Metrix. Google was second, at 39.6 percent. Google also made early cultural blunders. The Street View function for maps, which adds panoramic photos to the Google Maps Web site, so annoyed the privacy-conscious Japanese that the company was forced to reshoot its image stock with less intrusive cameras.”
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Scores Are Killed as Train in India DerailsIndia’s vast railway network is a transportation lifeline for the country’s 1.2 billion people, allowing them to travel long distances at very low fares by global standards. The 150-year-old system operates nearly 10,000 trains a day and with more than a million employees, it is the country’s largest employer. A series of deadly accidents, including one in 2010 that killed more than 150 people in West Bengal, has raised concerns that India’s railways are increasingly unsafe. Its aging infrastructure is badly in need of modernization, experts say, particularly its outdated safety equipment.”
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Indian Spiritualism Made for the Modern Age “It is not surprising that the first decade of the foundation was unremarkable. In the 1980s, the Indian middle class was closer in spirit to the poor than to the rich. There were no solutions to emotional problems. The sleeping pill came close, but there was something morbidly modern about it. Art films showed tragic creative men and licentious women in sleeveless blouses taking sleeping pills. In the 1990s, as the economy was liberalized and the middle class grew more prosperous, the word “stress” slowly entered their vocabulary, first as a somewhat self-congratulatory description of what their professional success has done to them. Later, “stress” began to include heartbreaks and other traumas.”
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Dozens of Students Killed in Bangladesh Accident “In Bangladesh, it’s usual to hire cargo trucks for a quick ride to carry large groups during festivals or celebrations.”
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China’s Wen Says Inflation Top Priority, More Tightening Seen “The Communist Party is worried that rising prices could spill over into public protest. Wen said in March that inflation could threaten social stability in the world’s second-biggest economy.”
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Chinese Imports Slow but Exports Rise “The slowing rate of imports in June, which dropped to a 19.3 percent annual pace from 28.4 percent in May, is expected to heighten investors’ concerns about how swiftly the Chinese economy, the world’s second-largest after that of the United States, is slowing. But coming a day after data showed that inflation in June had reached a three-year peak of 6.4 percent, analysts took the data showing a jump in the trade surplus as a sign that the Chinese central bank might have to raise interest rates further, to rein in prices and to discourage capital inflows. Last week, the central bank raised interest rates for the third time this year, underlining the government’s confidence in the economy’s ability to cope with tighter monetary policy. The data Sunday showed that June exports had risen 17.9 percent from the same period a year ago, slowing from a 19.4 percent rise in May and pointing to the weakness in overseas demand that has seen exports and new orders soften across most of Asia. Exports reached a record of $162 billion in June, while imports for the month were $139.7 billion. That left the country with a trade surplus of $22.3 billion in June, compared with $13.1 billion in May.”
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Joint Chiefs Chairman Meets With Chinese Counterpart “But Admiral Mullen’s visit comes as tensions between the two militaries are threatening to rise once more, this time over China’s claim to virtually all the South China Sea. The Philippines, Vietnam, Indonesia, Malaysia and Brunei also claim parts of the sea, which is believed to hold valuable oil and mineral deposits beneath the seabed.”
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China’s Rapid Growth Doesn’t Ensure Stock Gains “From 2000 to 2010, when China really began to industrialize, there was surplus labor and a cycle of infrastructure investment that drove a lot of productivity growth,” said Eric A. Brock, co-manager of the ALPS Clough China fund. “Inflation over that period was shockingly low. Today is different. You still have the productivity story, but the supply of labor has tightened. It wouldn’t surprise us if inflation is 3 to 5 percent a year going forward, but that’s not a problem in the context of 8 to 10 percent annual growth.”
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China’s Struggle With Inflation Continues as Price Index Rises “Indeed, rising wages among migrant workers, higher prices for food and gasoline, as well as droughts and flooding in key agricultural regions have all contributed to inflation this year. Many analysts say that China will succeed in its efforts to battle inflation and that the economy will ease but not face a difficult hard landing later this year. But with severe power shortages expected this summer and few signs of food prices easing, it’s unclear whether Beijing will be successful.”
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Italy Moves to Rein in Short-Selling Amid Market Jitters “For Italy, the cost of debt financing rose last week, though it is still well below the levels faced by Greece. The spread between the yield on the Italian 10-year bond and the German equivalent widened on Friday to 2.36 percentage points, the most since the introduction of the euro. Italy’s cost of borrowing for 10 years is now about 5.27 percent. The euro zone has been shaken by the fiscal troubles of Greece, Portugal and Ireland, though their economies are relatively small. The Italian economy is more than twice the size of the combined economies of those three countries. If investors were to drive Italy’s borrowing costs to unsustainable levels, it could imperil the entire European monetary union.”
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Despite Violence, U.S. Firms Expand in Mexico “Others are from investors farther afield. Foxconn, a Taiwanese firm that makes iPhones, Dell computers and other electronics, is one of several Asian companies taking root. It opened a plant in Juárez last summer. Down the coast from here, Posco, a Korean steel manufacturer, has announced plans to expand its operations with a second plant that will employ 300 people by 2013. Several other companies plan to built or expand in other states as well.”
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Unemployment? Who Cares? “First, unemployment is concentrated among the less educated, blacks and Hispanics who lack political or economic clout. Second, high unemployment is not hurting overall business profits, which have soared to historic heights. In the 1930s, joblessness reduced the demand for consumer goods, idling many businesses as well as workers, creating economic incentives to support public job-creation efforts. Today, our largest corporations and richest investors are well positioned to take advantage of growing demand in emerging markets far from our shores, whether in the form of increased exports or new investment opportunities. As a small-business owner explained in a recent Wall Street Journal article, he only sells domestically and does not have the opportunity to ‘exploit foreign markets that are growing faster.’ Third, the jobless individuals, public employees and small-business owners who could, in theory, form a strong political coalition to support more active job creation are constantly subjected to a barrage of arguments that we should do nothing but cut government spending and hope for the best.”
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Economy Faces a Jolt as Benefit Checks Run Out “Close to $2 of every $10 that went into Americans’ wallets last year were payments like jobless benefits, food stamps, Social Security and disability, according to an analysis by Moody’s Analytics. In states hit hard by the downturn, like Arizona, Florida, Michigan and Ohio, residents derived even more of their income from the government.”
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Rahm Emanuel and Unions Square Off Over Work Rules “With a budget deficit that could exceed $700 million next year, and with personnel costs representing the vast majority of expenses, Mr. Emanuel has said everyone must make sacrifices to help balance the city’s books. He has adhered to his campaign pledge to refrain from requesting that employees take more unpaid days off to save money, as Mr. Daley pushed them to do for years. Instead, Mr. Emanuel said last month, he will have to lay off more than 600 workers unless their unions agree to changes in work rules. Although at first city officials did not offer details, Mr. Emanuel last week described three of the nine proposals he had presented to union officials in a closed-door meeting. The mayor and his aides have not publicly revealed the other six changes or the amounts that any of the nine changes would save… But they have said that unionized city workers had already accepted a pay freeze, as many as 24 furlough days a year and compensatory time in lieu of overtime pay for the past two years to help Mr. Daley save money.”
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This Time, Japan’s Gloom Runs Deeper “And while the yen is near an all-time high against the dollar, you do not hear the protests from exporters anymore because ‘practically every company is talking about cost-cutting,’ Mr. Ishida said. ‘Eighty yen today is not the same as 80 yen in 1994.’ He cited cost-cutting and production’s moving offshore as why he expected pretax corporate profits in Japan to grow about 30 percent in the fiscal year that begins in April 2012, after declining about 5 percent this year. Home builders, truck and machinery makers and manufacturers of solar panels like Sharp and Sanyo may also get a lift from the government’s reconstruction efforts, others said. Still, eliminating jobs and closing factories is unlikely to provide much hope in a country that craves stability. Nor do lawmakers seem capable of finding creative solutions to these and many of Japan’s other problems, Mr. Ishida said. That, he added, ‘is bad news for the economy.’”
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A $22 Billion Question for India: What to Do With a Treasure? “But here in Thiruvananthapuram, the capital of Kerala formerly known as Trivandrum, many people — including the state’s top elected official, Hindus and the royal family that once ruled this part of India and still oversees the temple — argue that the treasure should remain, largely untouched, at the Sri Padmanabhaswamy temple where it has been housed for centuries. Their attitude partly reflects a suspicion that public officials entrusted with large sums of money will pocket much of it and mismanage the rest. Recent scandals, including one involving telecom licenses that cost the government an estimated $40 billion, have reinforced that cynicism. (That scandal has already sent one former minister to jail; on Thursday, another former telecom minister, Dayanidhi Maran, offered to quit the national cabinet in light of allegations that he used his position to benefit companies owned by his family.)”
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Somehow, the Unemployed Became Invisible “The United States is in the grips of its gravest jobs crisis since Franklin D. Roosevelt was in the White House. Lose your job, and it will take roughly nine months to find a new one. That is off the charts. Many Americans have simply given up. But unless you’re one of those unhappy 14 million, you might not even notice the problem. The budget deficit, not jobs, has been dominating the conversation in Washington. Unlike the hard-pressed in, say, Greece or Spain, the jobless in America seem, well, subdued. The old fire has gone out. In some ways, this boils down to math, both economic and political. Yes, 9.2 percent of the American work force is unemployed — but 90.8 percent of it is working. To elected officials, the unemployed are a relatively small constituency. And with apologies to Karl Marx, the workers of the world, particularly the unemployed, are also no longer uniting. Nor are they voting — or at least not as much as people with jobs. In 2010, some 46 percent of working Americans who were eligible to vote did so, compared with 35 percent of the unemployed, according to Michael McDonald, a political scientist at George Mason University. There was a similar turnout gap in the 2008 election. No wonder policy makers don’t fear unemployed Americans. The jobless are, politically speaking, more or less invisible. It wasn’t always so. During the Great Depression, riots erupted on the bread lines. Even in the 1980s and 1990s, angry workers descended on Washington by the busload. ‘There used to be a sense that unemployment was rich soil for radicalization and revolt,’ says Nelson Lichtenstein, a professor of labor history at the University of California, Santa Barbara. ‘That was a motif in American history for a long time, but we don’t seem to have that anymore.’ But why? It’s partly because of the greater dispersion of the unemployed, and partly because of the weakening of the institutions that previously mobilized them.”
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Stressed and Depressed, Koreans Avoid Therapy “Some experts trace South Korea’s emotional malaise to the decline of these traditional values and the rise of the country as a modern industrial power, starting in the 1980s. South Korea, once even poorer than woeful North Korea, now boasts the world’s 13th-largest economy. ‘As the society became more oriented toward materialism, people started to compare themselves,” said Dr. Park. “There’s a lot of competition now, even starting in childhood, and the goals of life have moved. We have a saying, ‘If one cousin buys land, the other cousin gets a stomachache.’”
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China Raises Interest Rates “The price rises that have accompanied soaring growth, meanwhile, have so far shown little sign of abating — in part because of sharp increases globally in the costs of raw materials. Natural disasters in China also have helped push up the cost of food. Inflation levels could ebb somewhat later this year, but are widely expected to remain elevated, presenting Beijing with a headache. The Chinese authorities are intensely aware that soaring household bills could lead to widespread public dissatisfaction.”
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2018 Winter Olympics Go to South Korea “Pyeongchang will be the third Asian city to host the Winter Games, after Sapporo, Japan, in 1972 and Nagano, Japan in 1998. Its budget for 2018 was far more extravagant than the other bids — $1.5 billion for the actual Games and $2 billion to $6 billion for infrastructure projects, according to news reports, as Pyeongchang seeks to become a winter sports hub.”
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Thai Election Appears on Track to Reverse Coup “In a contest that was seen as a referendum on Thailand’s recent turmoil, early election returns showed the Pheu Thai party, headed by Mr. Thaksin’s youngest sister, Yingluck Shinawatra, 44, with a commanding lead. Its target was an absolute majority, or half of the 500 seats. With 56 percent of the votes counted on Sunday night, the state election commission said that Pheu Thai was in the lead, with 251 seats, and the ruling Democrat party had 167 seats. Ms. Yingluck, 44, is a businesswoman with no political experience, and was selected to head the party by her brother, who called her his ‘clone.’ She proved to be a brilliant campaigner. The vote is a vindication for Mr. Thaksin, a populist champion of Thailand’s long marginalized rural poor who was elected prime minister twice, in 2001 and 2005, and removed in a coup in September 2006. ‘I believe all sides have to respect the decision of the people,’ he said Sunday, speaking to a Thai television station from Dubai, where he lives evading a conviction for abuse of power. “If any country doesn’t respect the decisions of its people, there’s no way it is going to find peace.” He appeared to be referring indirectly to the riots that paralyzed part of Bangkok for two months last year, when the so-called ‘red shirt’ protesters, most of whom are allied with Mr. Thaksin, staged antigovernment demonstrations. The vote had broader resonance as well, part of a rebalancing of Thailand’s hierarchical society that so far has played out in the streets, challenging the elite establishment and giving more voice to the poor.”
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Japan Plans Safety Tests of Nuclear Plants “At present, 35 of Japan’s 54 reactors are off-line, some due to earthquake-related damage, but most because of the routine repairs. Under Japanese law, reactors must halt for repairs every 13 months.”
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Japan’s Reconstruction Minister Resigns Over Verbal Gaffes “On Tuesday, his cabinet agreed on a supplementary budget bill for 2 trillion yen, or $24.7 billion, in spending for reconstruction, compensation to displaced residents and health checkups for those who lived near the Fukushima plant. The government will submit the bill to Parliament in hopes of winning passage by the end of the month. However, passage would require cooperation from the opposition, which has seized on Mr. Kan’s weakness as a chance to push a general election and possibly regain power. Despite public distaste for political maneuvering during a national crisis, the opposition apparently sees an irresistible opportunity as Mr. Kan’s approval ratings have dropped into the 20 percent range in recent polls.”
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An Online Scandal Underscores Chinese Distrust of State Charities “Philanthropy is only beginning to develop here. As more and more Chinese enter the middle and upper classes — Forbes this year listed 115 billionaires in China, up from 64 last year — some are looking to do good through charity donations. The Sichuan earthquake in 2008 led to a rise in civic consciousness, and the next year the government recorded $8 billion in donations.”
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In spite of tough austerity measures in Greece, Moody’s has dowgraded its debt to junk grade Europe Faces Tough Road on Effort to Ease Greek Debt with the same occurring in spite of Portugals austerity measures Portugal’s Debt Rating Cut to Junk by Moody’s
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Sovereign Debt Restructuring and International Investment Agreements Report by United Nations Committee on Trade and Development (UNCTAD)
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Corporate Cash Con “U.S. corporations are supposed to pay taxes on the profits of their overseas subsidiaries — but only when those profits are transferred back to the parent company. Now there’s a move afoot — driven, of course, by a major lobbying campaign — to offer an amnesty under which companies could move funds back while paying hardly any taxes. And even some Democrats are supporting this idea, claiming that it would create jobs. As opponents of this plan point out, we’ve already seen this movie: A similar tax holiday was offered in 2004, with a similar sales pitch. And it was a total failure. Companies did indeed take advantage of the amnesty to move a lot of money back to the United States. But they used that money to pay dividends, pay down debt, buy up other companies, buy back their own stock — pretty much everything except increasing investment and creating jobs. Indeed, there’s no evidence that the 2004 tax holiday did anything at all to stimulate the economy. What the tax holiday did do, however, was give big corporations a chance to avoid paying taxes, because they would eventually have repatriated, and paid taxes on, much of the money they brought in under the amnesty. And it also gave these companies an incentive to move even more jobs overseas, since they now know that there’s a good chance that they’ll be able to bring overseas profits home nearly tax-free under future amnesties. Yet as I said, there’s a push for a repeat of this disastrous performance. And this time around the circumstances are even worse. Think about it: How can anyone imagine that lack of corporate cash is what’s holding back recovery in America right now? After all, it’s widely understood that corporations are already sitting on large amounts of cash that they aren’t investing in their own businesses.”
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We Knew They Got Raises. But This? “The final figures show that the median pay for top executives at 200 big companies last year was $10.8 million. That works out to a 23 percent gain from 2009. The earlier study had put the median pay at a none-too-shabby $9.6 million, up 12 percent. Total C.E.O. pay hasn’t quite returned to its heady, prerecession levels — but it certainly seems headed there. Despite the soft economy, weak home prices and persistently high unemployment, some top executives are already making more than they were before the economy soured. Pay skyrocketed last year because many companies brought back cash bonuses, says Aaron Boyd, head of research at Equilar. Cash bonuses, as opposed to those awarded in stock options, jumped by an astounding 38 percent, the final numbers show. Granted, many American corporations did well last year. Profits were up substantially. As a result, many companies are sharing the wealth, at least with their executives. ‘We’re seeing a lot of that reflected in the pay,’ Mr. Boyd says.”
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World Bank Is Opening Its Treasure Chest of Data “And so Mr. Zoellick, 57, is wielding knowledge — lots of it. For more than a year, the bank has been releasing its prized data sets, currently giving public access to more than 7,000 that were previously available only to some 140,000 subscribers — mostly governments and researchers, who pay to gain access to it. Those data sets contain all sorts of information about the developing world, whether workaday economic statistics — gross domestic product, consumer price inflation and the like — or arcana like how many women are breast-feeding their children in rural Peru. It is a trove unlike anything else in the world, and, it turns out, highly valuable. For whatever its accuracy or biases, this data essentially defines the economic reality of billions of people and is used in making policies and decisions that have an enormous impact on their lives. Mr. Zoellick says the bank’s newfound openness is part of a push to embrace competition, both internally and externally, as it tries to reduce poverty and foster economic development.”
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Growing Discontent Seen in Annual Hong Kong Protest “As a gateway between Beijing and the West, Hong Kong has reaped the rewards of China’s economic rise, and its millionaires have prospered on the growth of the financial and property industries. But there are signs of increasing public anger here over a widening gap between rich and poor. One sign came on Friday as tens of thousands marched in stifling midsummer heat in the most politically charged protests here since 2003 and 2004, when hundreds of thousands rallied against government security proposals that eventually were scrapped. The police gave a preliminary estimate of 51,000 who left Victoria Park and marched to the government headquarters. But organizers said the final number of people protesting was 218,000, due, they said, to people who joined the march in progress…In Hong Kong, young adults and the elderly are the fastest growing segments among the low income and poor, said Mariana Chan, of the Hong Kong Council of Social Service, a government advisory agency. A record 1.26 million people in this territory of 7 million now live in poverty, Ms. Chan said.”
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Slavery in the Modern Age “According to the latest State Department statistics, as many as 100,000 people in the United States are in bondage and perhaps 27 million people worldwide. The numbers are staggering.”
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100th ILO annual Conference decides to bring an estimated 53 to 100 million domestic workers worldwide under the realm of labour standards “We are moving the standards system of the ILO into the informal economy for the first time, and this is a breakthrough of great significance,” said Juan Somavia, ILO Director-General. “History is being made.”
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Strengthening union communications in Asia and the Pacific “Participants at an IMF regional communicators’ forum for Asia Pacific, held in Seoul, welcome plans for a new regional journal and contribute to strengthening IMF and union communication in the region.”
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IMF-ICEM-ITGLWF merger discussed at AMLC in Korea “Metalworkers from Asia and the Pacific countries met in Seoul to discuss the IMF-ICEM-ITGLWF merger, share their experience on building union networks as well as organizing drive as the main priority for the unions of the region.”
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KMWU calls for urgent solidarity support “Dramatic developments take place in Korea at Hanjin Heavy Industries shipyard and Yuseong Piston Ring. Private security forces and riot police forced out protesters from the shipyard and the police issued arrest warrants for Yuseong Piston Ring union leaders who in sign of protest have started a hunger strike in the Buddhist Jogye Temple in Seoul.”
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Rights’ violations reported in Korean National Assembly “During his visit to the National Assembly of Korea as part of a numerous delegation of trade unions and progressive political parties IMF Assistant General Secretary, Fernando Lopes reported about increasing workers’ rights abuses in Korea.”
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Hanjin shipyard workers continue strike against mass dismissal “HHIC workers in Korea continue their struggle against mass dismissal conducted by the management in violation of a local collective bargaining agreement on the company’s restructuring redundancy policy.”
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Sri Lankan government withdraws proposed pension bill after protests “The government of Sri Lanka withdrew a new Employee Pension Benefit Fund Bill on June 3 after massive protests. One worker was killed and hundreds injured during workers’ strikes on May 31. IMF condemns the attack on workers and supports ITUC’s call for solidarity.”
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New cooperation delivers union organizing results in India “An International Metalworkers’ Federation’s organizing project in India results in 15,000 workers in the steel industry joining a union.”
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Searching for Something Good to Say About India “It would be reasonable for Indians to think that Mr. Coll was talking about them, but he was describing Pakistan. That Pakistan shares the same economic pattern as India points to a truth Indians may not want to easily accept: that the economic progress of India, as in most of the third world, is chiefly the consequence of the wealth of affluent countries’ successfully seeking markets that are so poor that they have the space to expand.”
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Election in ThailandThe parliamentary election Sunday will be the second since a military coup in 2006 that removed Prime Minister Thaksin Shinawatra from power and roiled Thai politics.”
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Rural Thais Find an Unaccustomed Power “As campaigning for the national election Sunday entered its final days, there was broad consensus that rural votes would be crucial in deciding the outcome. But no one is quite sure what rural means anymore. Villagers here complain of slow Internet download speeds. On a single street that winds past rice paddies, residents tell of work stints in Taiwan, Singapore, Israel and Saudi Arabia, enough frequent-flier miles to rival the inhabitants of a tony Bangkok condominium. Once seen as passive and fatalistic, villagers are now better educated, more mobile, less deferential and ultimately more politically demanding. Researchers who study rural life say villages like Baan Nong Tun may be ground zero for understanding why Thailand’s political crisis — warring political factions, five years of street protests and violent military crackdowns — has been so intractable. The old social contract, whereby power flowed from Bangkok and the political establishment could count on quiet acquiescence in the Thai countryside, has broken down. Villagers describe a sort of democratic awakening in recent years and say they are no longer willing to accept a Bangkok-knows-best patriarchal system. It is an upheaval that has been ill-understood by the elites, said Attachak Sattayanurak, a history professor at Chiang Mai University, in northern Thailand.”
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Taiwan: Former President Indicted on an Embezzlement Charge “Mr. Lee served as president from 1988 to 2000, and was elected in Taiwan’s first popular presidential election in 1996.”
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The Fear of a Toxic Rerun “Malaysia had reason to be cautious in allowing Lynas to build the plant. Its last rare earth refinery, operated by the Japanese company Mitsubishi Chemical, is now one of Asia’s largest radioactive waste cleanup sites. That plant, on the other side of the Malay peninsula, closed in 1992 after years of sometimes violent demonstrations by citizens. Despite the potential hazards, the Malaysian government was eager for investment by Lynas, even offering a 12-year tax holiday. The project is Australia’s largest investment in Malaysia, intended to produce $1.7 billion a year in rare earths, or nearly 1 percent of Malaysia’s entire economic output. Lynas agreed to pay 0.05 percent of the plant’s revenue each year to the Malaysian Atomic Energy Licensing Board for radiation research. Protests against the plant started in Malaysia after an article on Lynas’s project was published in The New York Times in early March.”
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China looks to Argentina to grow food “Beidahuang, which spawns nine separate companies plus agricultural investigation centres, is China’s top food group. In 2010 it produced 17.5bn kilos of grains, including 15bn kilos of cereals – sufficient, the company says, to feed 75m people for a year. Beidahuang’s step into Argentina, which took three years of negotiations, comes at a time when China’s imports of soyabeans and corn are rising to feed China’s growing appetite for meat, and global food prices are at record highs according to the UN. China invested heavily in three big energy deals last year that have turned Argentina into one of China’s most important toeholds in resource-rich Latin America, where it is seeking to secure energy and minerals – and now food – for its booming economy. China has been increasingly active in the past five years in outsourcing agriculture, signing a series of overseas deals, including projects in Cuba, Russia, Venezuela, Brazil and Kenya, quietly spearheaded by Beidahuang, whose name means ‘Great Northern Wilderness’. The irrigated agriculture project foresees infrastructure investments of $1.5bn over 10 years according to Oscar Gómez, one of the brains behind the project. Río Negro officials are encouraging the Chinese to look at corn, barley, wheat, potatoes, onions, squash, olives, vines and fruit. “We say soya won’t be profitable … This is ideal territory for corn, we’re pushing for that,” said Juan Manuel Accatino, provincial production minister in Río Negro…It is not only the Chinese who are looking keenly at Argentina. Prime Indian farmland in the Punjab costs about twice as much as in parts of Argentina, and the Indian ambassador in Buenos Aires is encouraging investors to consider Argentine land for producing soya, pulses and other crops. Simmar Pal Singh Bhurjee, a turbaned Sikh whose exotic appearance has earned him the nickname the ‘Prince of Peanuts’, heads the Argentine operations of Olam International, a non-resident Indian company based in Singapore which grows soya, corn, wheat and beans in Argentina as a sideline to its main peanut business. It has no plans itself to develop soya exports for India but Mr Singh says: ‘Soya is definitely a growth area. There are (Indian) companies which are ready to invest in Argentina and Brazil … I think it will grow – it’s only a matter of time.’”
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France’s Lagarde Named New Head of I.M.F. “But three years after a financial crisis on Wall Street sent the global economy into a tailspin, Europe is now at the center of the storm. ‘The most pressing crisis situation is in Europe right now, so it’s defensible that the I.M.F. should have a lot of its eggs in the European basket,’ said Nicolas Véron, a senior fellow at Bruegel, a Brussels-based research institute, and a visiting fellow at the Peterson Institute for International Economics in Washington. Ms. Lagarde, a former top executive at the Chicago-based law firm Baker & McKenzie, is considered a veteran political negotiator who speaks her mind, even when it has put her at odds with her boss, the French president Nicolas Sarkozy. She has nurtured a close personal relationship with the German chancellor, Angela Merkel, leading the two women to find common ground on several important policy decisions as the euro crisis unfurled. She also managed to soothe the concerns of emerging markets leaders by mounting an aggressive charm offensive as she campaigned for the job of I.M.F. chief, visiting Brazil, China, India and Africa in rapid succession in June with pledges to lift those countries’ power within the fund — something they countries have sought for years. Although emerging markets may be disappointed not to see Mr. Carstens heading the fund, Ms. Lagarde’s victory may end up being a better outcome because she ‘can twist the arms of European countries that have blocked progress on governance issues,’ said Eswar Shanker Prasad, a senior fellow at the Brookings Institution who worked at the I.M.F. for 17 years.”
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Public Workers Strike in Britain Over Pensions “The unions estimated that as many as 750,000 people would join the walkout. The strike is the latest development in an increasingly bitter dispute between the affected unions — including the National Union of Teachers, the Public and Commercial Services Union, and the University and College Union — and the Conservative-led coalition government. Ms. Blower said that the government had helped provoke the strike by refusing to budge in talks aimed at breaking the impasse. ‘In our negotiations, the government has refused to offer any movement on the three core issues of teachers having to work longer, pay more and get far less in retirement.’”
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Greek Parliament Approves Implementation of Austerity Plan “The new measures include cuts in spending on health and defense, tax increases on heating oil and the self-employed and the privatization of about $70 billion in state assets…At the last minute, the bill was altered to freeze the salaries of civil servants effective July 1, and to lower the ceiling below which income for individuals is tax-free to $11,600 annually from $17,400, with more lenient treatment for people with children.”
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Violent Clashes in the Streets of Athens “Unemployment has soared above 16 percent here — and more than 30 percent for those under 29.”
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Greek Parliament Approves Austerity Plan “The measures approved Wednesday include tax increases, wage cuts and the privatization of 50 billion euros, or about $72 billion, in state assets. A second vote will be held Thursday to implement the measures, with key sticking points expected to include the timing of the privatizations, especially of the state electric utility, Public Power Corporation, whose powerful union has close ties to the Socialists.”
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Seeking to Avoid Uprising, Kuwait Escalates Budget According to this article, the Kuwaiti state spends lavishly on native born citizens, while denying rights to foreign born workers, the majority of the residents of the country.
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Boeing Labor Dispute Is Making New Factory a Political Football “The case stems from a complaint the International Association of Machinists and Aerospace Engineers filed last year, asserting that Boeing was illegally retaliating against its members in Washington State for exercising their right to strike. Those workers have gone on strike five times since 1977, including a 58-day walkout in 2008. Christopher Corson, the machinists’ general counsel, said, ‘Boeing broke the law, and there are consequences when someone breaks the law.’ Boeing officials deny violating any labor laws, saying that the main reason they chose South Carolina was to lower production costs. On Thursday, an administrative law judge in Seattle denied Boeing’s request to dismiss the case. Connie Kelliher, a spokeswoman for the machinists, said the union was not seeking to shut down the South Carolina plant. In its settlement negotiations with Boeing, the union has suggested that the company keep the plant operating by moving some outsourced parts production from other countries to South Carolina — an idea that Boeing and industry analysts consider unrealistic. For the machinists, the stakes are high. They fear that if Dreamliner production is allowed to go forward in South Carolina, then much of Boeing’s future expansion will take place there. For South Carolina, battered by the closing of textile mills and furniture factories, the plant is equally vital. ‘These things come along at best once a decade,” said Douglas P. Woodward, an economics professor at the University of South Carolina. “It’s as big as anything that’s happened to South Carolina since BMW.’ Indeed, BMW opened near Spartanburg in 1994, with 1,200 workers. Since then, employment has expanded to 7,000, and officials say the factory has produced 21,000 spinoff jobs. South Carolinians are hoping for a similar trajectory with Boeing.”
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Air India Pilots Allege Safety Risks “Air India, India’s unprofitable national carrier, is using ‘coercion and fear’ to compel pilots to fly long hours and while ill, an Indian pilots’ union claims. The Indian Pilots’ Guild, the union that represents Air India’s international pilots, made the claim in a June 14 letter to Star Alliance, a network of 27 airlines. Air India is in the final stages of joining the alliance. The letter is the latest salvo in a feud between Air India’s management and its 1,600 pilots. Short of cash, Air India has delayed paying salaries and other compensation to pilots and tens of thousands of other employees. It has also missed payments to vendors, including fuel and ground transportation suppliers.”
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White House and Congress Clear Trade Deal Hurdle “But the trade agreements also are likely to put some Americans out of work as cheaper imports from the three countries undermine existing American manufacturers. The deals have been rewritten to protect American companies and workers, in part by insisting on better workplace conditions in those countries to minimize their advantage. ‘We’re ramping up our outreach to members of Congress, member of unions and members of the public to make sure we have a full and honest debate about what these trade agreements will mean,’ said Thea Lee, chief international economist at the A.F.L.-C.I.O. The South Korea deal will lead to losses of manufacturing jobs, she said. ‘Colombia, there is of course continuing concern about violence against union leaders and members. On Panama, there are still concerns about labor law reform and the tax haven status.’ Democratic lawmakers who share these concerns insisted on the expansion of worker benefits. The aid program, created in the 1960s, was expanded in 2009 as part of economic stimulus legislation to offer broader benefits and to include workers in service industries as well as manufacturing. But the expansion lapsed in January.”
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Almost 40 million Brazilians climbed to middle class in the last eight years “Between 2003 and 2010, former president Lula da Silva implemented social policies that helped 28 million Brazilians out of poverty and indigence. Last June President Dilma Rousseff launched her program ‘Brazil without misery’ which is basically a continuation of the plans launched by Lula da Silva and with which she pretends to end the extreme poverty in which 16 million Brazilians live.”
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Elders Offer Help at Crippled Reactor “Although Mr. Yamada, a soft-spoken cancer survivor, started with a simple goal, he has triggered a much wider debate about the role of the elderly in Japan, the meaning of volunteerism and the growing reality that the Tokyo Electric Power Company, which owns the reactors, will face an increasingly difficult time recruiting workers. Some experts expect that Japan will ultimately import laborers to help with the cleanup. More than 3,000 workers, many of them poorly paid part-timers, are at the Daiichi site. Already, several have suffered heat stroke and nine have absorbed more than their legal limit of radiation. Dozens of workers have stopped showing up.”
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Greeks Begin Two-Day Strike Before Austerity Vote “The rare two-day strike, organized by the country’s two main labor unions, is the second walkout this month and the seventh in a year that has seen public outrage with the Socialist government’s relentless austerity drive grow. Tuesday’s action was the first time Greek unions have walked out for more than 24 hours since democracy was restored in 1974 following the fall of a six-year military dictatorship.”
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Job Jugglers, on the Tightrope “But in many cases, necessity is driving the trend. ‘Young college graduates working multiple jobs is a natural consequence of a bad labor market and having, on average, $20,000 worth of student loans to pay off,’ said Carl E. Van Horn, director of the John J. Heldrich Center for Workforce Development at Rutgers. ‘There are two types of people in this position: the graduate who can’t get a full-time job, and the person whose income isn’t sufficient to meet their expenses,’ he said. ‘The only cure for young people in this position is an economic recovery of robust proportions.’ An entry-level salary often doesn’t go very far these days. According to a study by the Heldrich Center, the median starting salary for those who graduated from four-year degree programs in 2009 and 2010 was $27,000, down from $30,000 for those who graduated in 2006 to 2008, before the recession. (Try living on $27,000 a year — before taxes — in a city like New York, Washington or Chicago.)”
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Bridge Comes to San Francisco With a Made-in-China Label “American steelworker unions have disparaged the Bay Bridge contract by accusing the state of California of sending good jobs overseas and settling for what they deride as poor-quality Chinese steel. Industry groups in the United States and other countries have raised questions about the safety and quality of Chinese workmanship on such projects. Indeed, China has had quality control problems ranging from tainted milk to poorly built schools… Zhenhua put 3,000 employees to work on the project: steel-cutters, welders, polishers and engineers. The company built the main bridge tower, which was shipped in mid-2009, and a total of 28 bridge decks — the massive triangular steel structures that will serve as the roadway platform. Pan Zhongwang, a 55-year-old steel polisher, is a typical Zhenhua worker. He arrives at 7 a.m. and leaves at 11 p.m., often working seven days a week. He lives in a company dorm and earns about $12 a day.”
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Cambodia After Year Zero “Cambodia is one of the world’s poorest countries. “Among Southeast Asian nations,” Brinkley writes, “only Burma is poorer, on a per capita basis.” At least 30 percent of Cambodians live on less than a dollar a day. About 40 percent of children suffer from stunting (failure to develop because of poor nutrition). In 2010 only 30 percent of Cambodian middle-school-age students were enrolled in school. Asia’s self-described “longest ruling prime minister,” Hun Sen, is a murderous kleptocrat, Brinkley shows. Corruption is rife. The sick may die waiting for treatment if they cannot pay doctors’ bribes in hospitals.”
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Campaigning for Change in Mexico “There is mounting international and domestic pressure for Mexico to change. The rise of China has benefited Latin American countries like Brazil and Chile, which export minerals, agricultural goods and other commodities to the Asian giant. But it has hurt Mexico, because the country produces the same kinds of export-assembly products the Chinese churn out cheaply and efficiently. Increasing Mexico’s competitiveness will require tabling the traditional aversion to standing up to power. It will mean dismantling the utilities monopolies that make the country’s electricity and fixed-line business phone services more expensive than in the United States. It will also demand greater deference for the rule of law, a concept that has never gained traction in Mexico and has helped create a culture of impunity in which drug cartels have thrived.”
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Qilai Shen/European Pressphoto Agency A suit factory on the outskirts of Shanghai on Friday (from NYTimes, Tuesday, June 21, 2011)
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The King of Really Big Diamonds Heads to China “But now Mr. Graff is pushing into China, where the number of billionaires is climbing annually — and ranks second only to that of the United States. Everyone else is piling in, too. The exploding market for diamonds in China, it seems, is yet another sign of its rising economic might, or at least the willingness of its ultrarich to spend — and spend big.”
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China: Media Coverage of a Study Embarrasses Party “A media storm over corrupt officials is embarrassing China’s Communist Party as it prepares to celebrate its 90th birthday on July 1. The news coverage has focused on a study circulating on the Internet claiming that corrupt officials have fled the country with more than $100 billion since the mid-1990s, mainly to the United States. It is unclear who wrote the 71-page study, which is marked “internal material” but has no author, letterhead or other identifying features. It was reported to have been posted on the Web site of the People’s Bank of China. It remains online, but not on the bank’s Web site.”
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As Europeans Wince at Austerity, Markets Fear Turmoil “In recent months, the governments of Ireland and Portugal have been ousted over efforts to cut budgets and benefits. Students have rioted to protest tuition increases in Britain, and young people who feel shut out of their own futures have held nationwide sit-ins in Spain, where the governing Socialists are in trouble in the polls. Right-wing political parties are gaining strength, tapping, in part, the populist rejection of austerity plans. This week, Mr. Papandreou became the latest politician pulled in opposite directions by the markets, which hang on his every word, and his country’s citizens, who have already been stung by one round of wage and pension cuts and are resisting new spending reductions and tax increases. But he needs those measures to persuade the International Monetary Fund to release the next installment of a $155 billion bailout package negotiated a year ago.”
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Greece Replaces Finance Minister “Another victim of the reshuffle was Labor Minister Louka Katseli, 59, one of the most controversial figures in Mr. Papandreou’s cabinet. The Princeton-educated economist had repeatedly clashed with Greece’s foreign creditors on several proposed economic reforms including amending labor contracts that protect the rights of workers in the private sector. She was replaced by her deputy, Yiannis Koutroumanis.”
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From African Village to Center of Ordeal – In Strauss-Kahn case, a microcosm of globalization, power and precarity.
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Friedman: Justice Goes Global “At Tsinghua and Fudan, Sandel challenged students with a series of cases about justice and markets: Is it fair to raise the price of snow shovels after a snowstorm? What about auctioning university admissions to the highest bidder? ‘Free-market sentiment ran surprisingly high,’ Sandel said, ‘but some students argued that unfettered markets create inequality and social discord.’ Sandel’s way of teaching about justice ‘is both refreshing and relevant in the context of China,’ Dean Qian Yingyi of Tsinghua’s School of Economics and Management, explained in an e-mail. Refreshing because of the style and relevant because “the philosophic thinking among the Chinese is mostly instrumentalist and materialistic,” partly because of ‘the contemporary obsession on economic development in China.’”
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Lead Poisoning in China: The Hidden Scourge “At the Haijiu Battery Factory, which exports to the United States, regulation of lead emissions was not so much lax as nonexistent. The factory’s opening in 2005 brought more than 1,000 jobs. Local authorities allowed the plant to expand to within a rice paddy of the village. They also ignored the breakdown of ventilation equipment and the building of a hostel for workers and their spouses and children on factory grounds. Workers say managers simply slowed down production lines when inspectors came. One worker said he had watched a supervisor cover a device that tests for lead emissions in the air with his cap, then whisk the inspectors away for tea. It did not take long for problems to surface. Workers said they repeatedly had tested above the occupational limit for blood lead levels and were sent to the local hospital, where drugs were injected intravenously to reduce the level and toxicity of lead in their bodies. Zhou Zuyin, 42, said he was hospitalized for treatment of lead poisoning every year for four years, returning each time to his job of smoothing the edges of lead sheets. Even after a test revealed liver damage, he said, ‘The factory said it was normal.’”
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Russia Seizes a Ton of Animal Parts Smuggled From China “Smuggling is generally blossoming in Russia’s Far East. The long border with China, closed for decades, is now open for travel and trade.”
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Rethink strategic link with China – “The visit that the vice president of the People’s Republic of China, Xi Jinping, will carry out to several Latin American nations in the next few days provides an opportunity to focus the regional debate on the urgent need to rethink the strategic link between Latin America and the Asian giant.”
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South-South Diplomacy Props Up Economic Modernisation – “Within a few days of each other, former Brazilian President Luiz Inacio Lula da Silva (2003-2011), Chinese Vice President Xi Jinping – likely successor to the current Chinese president – and Venezuelan President Hugo Chávez passed through Havana, the latter arriving Jun. 8 to review with his hosts the progress of strategic joint projects. All three countries support major Cuban economic projects, such as the Cienfuegos and Mariel development zones, 254 and 45 km from Havana, respectively, whose success depends on the impact of structural reforms passed in April for bolstering the efficiency of the state business system.”
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Costa Rica Signs Into Law Free Trade Accord With China – “Costa Rican President Laura Chinchilla signed into law today a free trade accord with China, the Central American government said in an e-mailed statement. With the new agreement, 70 percent of Costa Rica’s exports will be benefited by free trade agreements, the government said. Trade between China and Costa Rica has grown 14-fold since 2000, reaching $1.3 billion last year, the government said.”
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Wal-Mart Workers Try the Nonunion Route “Kent Wong, director of Center for Labor Research and Education at the University of California, Los Angeles, said OUR Walmart was a smart approach for a union movement that is on the defensive. ‘Given the circumstances,’ he said, ‘unions need to explore creative ways of organizing that will provide some opportunity for workers to have a voice to improve wages and working conditions.’ OUR Walmart has been inspired by a handful of groups that unions formed when they recognized it would be too difficult to unionize a company. The foremost model is the Alliance at I.B.M., a group with several hundred dues-paying members and some 5,000 supporters that has backed several shareholder actions and has often spoken out to the news media on workplace safety issues and the outsourcing of high-tech jobs. The Alliance once mounted a protest that helped persuade I.B.M. to revise a pension overhaul that had hurt many older workers. ‘It’s very difficult to win a union election in the United States, especially at sophisticated companies like I.B.M. and Wal-Mart,’ said Lee Conrad, the Alliance’s national coordinator. ‘But these groups show you can raise issues that help workers.’”
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Unemployment Falling in Latin America, UN Agencies Say “Urban unemployment in Latin America and the Caribbean will ebb again this year, from 7.3 percent to somewhere between 6.7 percent and 7 percent, two U.N. agencies said Tuesday in a joint report. The Economic Commission for Latin America and the Caribbean and the International Labor Organization said that economic vulnerability has been reduced by counter-cyclical economic policies, including investment in infrastructure, emergency employment plans and stimulus for companies and social programs. Nonetheless, the analysis said that these policies were generally the result of a short-term reaction, the reason they recommend institutionalizing the counter-cyclical focus to permit a rapid response to any new crisis that might arise. The decrease in urban unemployment has been continual since 2002, when it was more than 11 percent, though the improvement has been unequal, since the reduction has taken place more in South American countries than in the northern areas of Latin America and, above all, the Caribbean.”
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Violent Crime Soars in Athens “As the Greek government struggles to save its debt-racked economy from collapse, another crisis is growing in the capital: A sharp increase in violent crime is stirring unrest among a public already demoralized by unending economic hardship.”
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Obama Offers Training Plan Designed for High-Tech Jobs “In coming to North Carolina to promote his plans to keep high-tech, high-paying jobs in this country, Mr. Obama is trying to hang on to a state that he narrowly won in 2008. But highlighting the climb ahead for the president is North Carolina’s unemployment rate, which was 9.7 percent in April, the 10th highest in the country. The overall national jobless rate in May was 9.1 percent, up slightly from the month before.”
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Inflation in China Rose to 5.5% in May “The Chinese authorities are intensely sensitive to rising consumer costs and any social tensions that could be set off by soaring food and fuel prices. Beijing has announced a series of steps designed to slow economic growth and the inflation that has accompanied it. However, with the rise in global commodities prices, pressure for higher wages and severe droughts in China this year also fanning inflation, analysts expect consumer prices to continue to gain for a few months before they level off later this year.”
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Chinese Street Vendor Dispute Expands into Violent Melee “Chinese authorities recorded 127,000 so-called mass incidents last year, but most were too small to gain wide notice.”
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Candidate in Thailand Follows Path of Kin “The incumbent Democrat Party is fighting back with promises of its own, including a 25 percent increase in the minimum wage. The central bank has warned that the expensive populism of both parties could strain the economy and spur inflation.”
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Tales of the Search for a Summer Job: Only one in four youths ages 16 to 19 is expected to find work this summer. Four teenagers across the country share their experience.
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The U.S. Military has relied on some of the same precarious labor relations when operating outside of the U.S., as reported in The New Yorker The Invisible Army: Workers lured into the war zone as we have seen in other cases, in an interview with Sarah Stillman, Ask the Author Live: Sarah Stillman on Foreign Workers for the U.S. Military , she reports “What’s interesting, Wanda, is that many of the alleged abuses taking place happen at the hands of foreign subcontractors. Many third-country nationals I met viewed the U.S. military as their allies in battling the companies for better treatment. Yet because the Pentagon’s contracting chains in Iraq and Afghanistan are so convoluted — sometimes as many as five or six tiers of subcontracts—accountability is hard to come by, and everyone involved can wash their hands of responsibility.”
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The Uncertainty Tax – “Over the last 20 years, McKinsey notes, with each recession more employers have used the downturn to replace workers with machines and software, so it takes much longer for full employment to come back. I’ve been working on a book that required talking to a lot of entrepreneurs and have been struck by how many told me some version of: ‘I used the recession to downsize and get really efficient. None of those jobs are coming back. I am doing a little hiring now, but for people with more skills.’” An Economy that Works: Job Creation and America’s Future or Full Report
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U.S. Underwrites Internet Detour Around Censors – It’s hard to escape global influences
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Toyota Expects 31% Profit Slump – “The higher costs of producing cars in Japan has raised the question of how long Toyota can continue to base so much of its production in its home country.”
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Saudi Arabia, Defying OPEC, Will Raise Its Oil Output – Increased production will go to China and other Asian countries
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Companies Spend on Equipment, Not Workers – “I want to have as few people touching our products as possible,” said Dan Mishek, managing director of Vista Technologies in Vadnais Heights, Minn. “Everything should be as automated as it can be. We just can’t afford to compete with countries like China on labor costs, especially when workers are getting even more expensive.”
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Rule by Rentiers - Why spending cuts trump job creation
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Egypt’s Economy Slows to a Crawl; Revolt Is Tested – Wage and employment expectations go unmet as economy continues to weaken
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An Intimate Biography of Millions – A new book on India
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Economy Sends Japanese to Fukushima for Jobs – Employment need leads to contract labor growth in Japan
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More Trade and More Aid – World trade and US workers
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The German Example – A better alternative?
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Spain Approves Measure to Free Up Labor Market – “The Spanish government approved Friday measures intended to reduce chronically high unemployment by introducing more flexibility in labor relations, despite failing to get support from employers and unions for the changes. With Spain hampered by a 21 percent jobless rate — twice the European average — the government chose to make the ruling by decree after four months of negotiations between the biggest labor unions and the Spanish Confederation of Employers’ Organizations, known as C.E.O.E., broke down last week.”
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An Awakening That Keeps Them Up All Night – Unemployed protest in Spain
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Frustration Grows as Nominee for the Fed Withdraws – A missed opportunity to have an employment expert on the Fed board
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When a Nobel Prize Isn’t Enough – A word from Peter Diamond himself
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Plan for China’s Water Crisis Spurs Concern – Massive investment to address water shortage in China
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Save Fulbright Hays Programs – Petition against cancellation of Fullbright Hays dissertation support for non- Western European international research
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As China’s Workers Get a Raise, Companies Fret – Chinese wage increases effect region and beyond
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The Frowniest Spot on Earth – London Review of Books pans Aerotropolis
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The Age of Aerotropolis – UNC endeavors covers Aerotropolis
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China’s Economy Slows, but Inflation Still Looms – China balances growth and inflation
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Japan Appears Dispensable as a Supplier – Japan’s diminished role in global supply chain
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Slums Into Malls – Indian road to development
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Indonesia’s Success Mixes Opportunity With Growth Pains – Growth limited by infrastructure in Indonesia
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China’s Interest in Farmland Makes Brazil Uneasy – China invests in food production overseas
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China’s Utilities Cut Energy Production, Defying Beijing – Energy and markets in conflict in China
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Sony Swings to Big Loss After Natural Disasters – Supply chain disruption leads to loss at SONY
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Union Effort Turns Its Focus to Target – Organizing efforts increase in areas that cannot be sent off shore, retail
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At Well-Paying Law Firms, a Low-Paid Corner – Two tier wages scale, even at law firms, as a way to deal with pressures from outsourcing
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As Indian companies grow in the U.S., outsourcing comes home – Indian companies bring outsourcing “near shore”
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Elite South Korean University Rattled by Suicides – Pressure is on for Korean university students
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Capitalists Who Fear Free Markets - Capitalists versus markets in Japan
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Walmart Supplier Supports Torture, False Imprisonment of Labor Activists – Labor rights for Wal Mart suppliers in Bangladesh
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Ultimatum Holding Up Trade Deals – Free trade agreements and worker protections
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Money Troubles Take Personal Toll in Greece – Precarity grows in Greece
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In Debt, Far From Home and Claiming Servitude – Vietnamese migrants face debt servitude
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North Korean Prison Camps Massive and Growing – Prison labor in North Korea
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