Author: PolitCens

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washington — About one-quarter of U.S. adults age 50 and older who are not yet retired say they expect to never retire, and 70% are concerned about prices rising faster than their income, an AARP survey finds.

About 1 in 4 have no retirement savings, according to research released Wednesday by the organization that shows how a graying America is worrying more and more about how to make ends meet even as economists and policymakers say the U.S. economy has all but achieved a soft landing after two years of record inflation.

Everyday expenses and housing costs, including rent and mortgage payments, are the biggest reasons why people are unable to save for retirement.

The data will matter this election year as Democratic President Joe Biden and Republican rival Donald Trump are trying to win support from older Americans, who traditionally turn out in high numbers, with their policy proposals.

Everyday expenses hamper saving

The AARP’s study, based on interviews completed with more than 8,000 people in coordination with the NORC Center for Public Affairs Research, finds that one-third of older adults with credit card debt carry a balance of more than $10,000 and 12% have a balance of $20,000 or more. Additionally, 37% are worried about meeting basic living costs such as food and housing.

“Far too many people lack access to retirement savings options and this, coupled with higher prices, is making it increasingly hard for people to choose when to retire,” said Indira Venkateswaran, AARP’s senior vice president of research. “Everyday expenses continue to be the top barrier to saving more for retirement, and some older Americans say that they never expect to retire.”

The share of people 50 and older who say they do not expect to retire has remained steady. It was 23% in January 2022 and 24% that July, according to the study, which is conducted twice a year.

“We are seeing an expansion of older workers staying in the workforce,” said David John, senior strategic policy advisor at the AARP Public Policy Institute. He said this is in part because older workers “don’t have sufficient retirement savings. It’s a problem and its likely to continue as we go forward.”

In the AARP survey, 33% of respondents 50 and older believe their finances will be better in a year.

Based on the 2022 congressional elections, census data released Tuesday shows that voters 65 and older made up 30.4% of all voters, while Gen Z and millennials accounted for 11.7%.

Biden has tried to court older voters by regularly promoting a $35 price cap on insulin for people on Medicare. He trumpets Medicare’s powers to negotiate directly with drugmakers on the cost of prescription medications.

Trump, in an interview with CNBC in March, indicated he would be open to cuts to Social Security and Medicare. The former president said “there is a lot you can do in terms of entitlements, in terms of cutting.”

Karoline Leavitt, press secretary for Trump’s campaign, said in a statement to The Associated Press on Tuesday that Trump “will continue to strongly protect Social Security and Medicare in his second term.”

Candidates court senior voters

A looming issue that will affect Americans’ ability to retire is the financial health of Social Security and Medicare.

The latest annual report from the program’s trustees says the financial safety nets for millions of older Americans will run short of money to pay full benefits within the next decade.

Medicare, the government-sponsored health insurance that covers 65 million older and disabled people, will be unable to pay full benefits for inpatient hospital visits and nursing home stays by 2031, the report forecast. And just two years later, Social Security will not have enough cash on hand to pay out full benefits to its 66 million retirees.

An AP-NORC poll from March 2023 found that most U.S. adults are opposed to proposals that would cut into Medicare or Social Security benefits, and a majority support raising taxes on the nation’s highest earners to keep Medicare running as is.
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Hundreds of students at U.S. universities have been arrested in protests against Israel’s war in Gaza. U.S. Secretary of State Antony Blinken said the protests are a hallmark of U.S. democracy but criticized students for their silence on Hamas. White House Bureau Chief Patsy Widakuswara reports.
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ANKARA — President Recep Tayyip Erdogan’s planned meeting with U.S. President Joe Biden, set for May 9 at the White House, has been postponed because of changes in the Turkish leader’s schedule, a Turkish official said on Friday. 

A new date will soon be set, the official said, requesting anonymity. 

The White House had not formally announced the visit, but a U.S. official told Reuters in late March that the White House had offered, and Ankara had accepted, May 9 for the meeting. 
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Seoul, South Korea — U.S. Secretary of State Antony Blinken expressed “serious concern” about China’s support for Russia’s defense industry on Friday, warning Chinese leaders that Washington could impose sanctions over the matter.

Blinken’s comments came in Beijing, shortly after he met with Chinese President Xi Jinping and other senior Chinese leaders during meetings that covered a wide range of disputes between the two powers.

Near the top of Blinken’s agenda, U.S. officials said, was China’s provision of items such as microchips, machine tools, and other items Russia is using to create weapons for use in its war against Ukraine.

“I told Xi, if China does not address this problem, we will,” said Blinken.

For weeks, U.S. officials have hinted at further sanctions meant to deter China’s provision of so-called dual-use items to Russia, which Washington says has been crucial to Moscow’s war on Ukraine. It is not clear how far Washington will go, however, since cutting off major Chinese banks from the U.S. financial system also could hurt the U.S. and global economy.

At a press conference in Beijing, Blinken did not reveal details about any possible measures, stating only that the United States has already imposed sanctions on more than 100 Chinese entities. “We’re fully prepared to act, take additional measures, and I made that very clear in my meetings today,” he noted.

China has defended its approach to Russia, saying it is only engaged in normal economic exchanges with a major trading partner. In his public remarks Friday, Xi did not mention the Russia-Ukraine issue. Instead, he focused on the necessity for U.S.-China ties to improve.

“China and the United States should be partners rather than rivals; help each other succeed rather than hurt each other; seek common ground and reserve differences, rather than engage in vicious competition,” Xi said.

Blinken’s meeting with Xi had not been previously announced but was widely expected.

U.S.-China relations stabilized last year, after Xi met U.S. President Joe Biden in California. At that summit, the two sides agreed to reopen military-to-military communication and take steps to reduce the flow of fentanyl, a dangerous narcotic responsible for tens of thousands of drug overdoses in the United States each year.

Blinken cited “important progress” on the fentanyl issue, even while insisting China needs to do more, including prosecute those who sell chemicals and equipment used to make fentanyl. Blinken also announced that both sides agreed to hold their first talks related to concerns over artificial intelligence.

Even as communications lines remain open, the United States and China continue to spar over a broad range of issues, including trade policies and territorial disputes.

The Biden administration is concerned about cheap Chinese exports, including heavily subsidized green technology products they say are undercutting U.S. companies.

During a five-and-a-half hour meeting with Chinese Foreign Minister Wang Yi on Friday, Blinken raised concerns, including the importance of maintaining peace and stability in the Taiwan Strait, Chinese activities in the disputed South China Sea, and the need to avoid further escalation in the Middle East and on the Korean Peninsula, according to a U.S. readout.

China accuses the United States of inappropriately trying to contain its economic and military power. Following his meeting with Blinken, Wang said China-U.S. ties are “beginning to stabilize” but asserted that negative factors are “increasing and building,” warning that the relationship faces “all kinds of disruptions.”

“Should China and the United States keep to the right direction of moving forward with stability or return to a downward spiral?” Wang asked. “This is a major question before our two countries.”
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Asian Americans are the fastest growing group of eligible voters in the United States, according to the Pew Research Center. That makes them an important focus for presidential candidates Joe Biden and Donald Trump. VOA correspondent Scott Stearns has our story. Video: VOA Khmer Service, VOA Mandarin Service, Matt Dibble 
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WASHINGTON — Ukraine has sidelined U.S.-provided Abrams M1A1 battle tanks for now in its fight against Russia, in part because Russian drone warfare has made it too difficult for them to operate without detection or coming under attack, two U.S. military officials told The Associated Press.

The U.S. agreed to send 31 Abrams to Ukraine in January 2023 after an aggressive monthslong campaign by Kyiv arguing that the tanks, which cost about $10 million apiece, were vital to its ability to breach Russian lines.

But the battlefield has changed substantially since then, notably by the ubiquitous use of Russian surveillance drones and hunter-killer drones. Those weapons have made it more difficult for Ukraine to protect the tanks when they are quickly detected and hunted by Russian drones or rounds.

Five of the 31 tanks have already been lost to Russian attacks.

The proliferation of drones on the Ukrainian battlefield means “there isn’t open ground that you can just drive across without fear of detection,” a senior defense official told reporters Thursday.

The official spoke on the condition of anonymity to provide an update on U.S. weapons support for Ukraine before Friday’s Ukraine Defense Contact Group meeting.

For now, the tanks have been moved from the front lines, and the U.S. will work with the Ukrainians to reset tactics, said Joint Chiefs of Staff Vice Chairman Adm. Christopher Grady and a third defense official who confirmed the move on the condition of anonymity.

“When you think about the way the fight has evolved, massed armor in an environment where unmanned aerial systems are ubiquitous can be at risk,” Grady told the AP in an interview this week, adding that tanks are still important.

“Now, there is a way to do it,” he said. “We’ll work with our Ukrainian partners, and other partners on the ground, to help them think through how they might use that, in that kind of changed environment now, where everything is seen immediately.”

News of the sidelined tanks comes as the U.S. marks the two-year anniversary of the Ukraine Defense Contact Group, a coalition of about 50 countries that meets monthly to assess Ukraine’s battlefield needs and identify where to find needed ammunition, weapons or maintenance to keep Ukraine’s troops equipped.

Recent aid packages, including the $1 billion military assistance package signed by President Joe Biden on Wednesday, also reflect a wider reset for Ukrainian forces in the evolving fight.

The U.S. is expected to announce Friday that it also will provide about $6 billion in long-term military aid to Ukraine, U.S. officials said, adding that it will include much sought after munitions for Patriot air defense systems. The officials spoke on condition of anonymity to discuss details not yet made public.

The $1 billion package emphasized counter-drone capabilities, including .50-caliber rounds specifically modified to counter drone systems; additional air defenses and ammunition; and a host of alternative, and cheaper, vehicles, including Humvees, Bradley Infantry Fighting Vehicles and Mine Resistant Ambush Protected Vehicles.

The U.S. also confirmed for the first time that it is providing long-range ballistic missiles known as ATACMs, which allow Ukraine to strike deep into Russian-occupied areas without having to advance and be further exposed to either drone detection or fortified Russian defenses.

While drones are a significant threat, the Ukrainians also have not adopted tactics that could have made the tanks more effective, one of the U.S. defense officials said.

After announcing it would provide Ukraine the Abrams tanks in January 2023, the U.S. began training Ukrainians at Grafenwoehr Army base in Germany that spring on how to maintain and operate them. They also taught the Ukrainians how to use them in combined arms warfare — where the tanks operate as part of a system of advancing armored forces, coordinating movements with overhead offensive fires, infantry troops and air assets.

As the spring progressed and Ukraine’s highly anticipated counteroffensive stalled, shifting from tank training in Germany to getting Abrams on the battlefield was seen as an imperative to breach fortified Russian lines. Ukrainian President Volodymyr Zelenskyy announced on his Telegram channel in September that the Abrams had arrived in Ukraine.

Since then, however, Ukraine has only employed them in a limited fashion and has not made combined arms warfare part of its operations, the defense official said.

During its recent withdrawal from Avdiivka, a city in eastern Ukraine that was the focus of intense fighting for months, several tanks were lost to Russian attacks, the official said.

A long delay by Congress in passing new funding for Ukraine meant its forces had to ration ammunition, and in some cases they were only able to shoot back once for every five or more times they were targeted by Russian forces.

In Avdiivka, Ukrainian forces were badly outgunned and fighting back against Russian glide bombs and hunter-killer drones with whatever ammunition they had left.
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New York — Columbia University backed off late Thursday from an overnight deadline for pro-Palestinian protesters to abandon an encampment there as more college campuses in the United States sought to prevent occupations from taking hold.

Police have carried out large-scale arrests in universities across the country, at times using chemical irritants and tasers to disperse protests over Israel’s war with Hamas.

The office of New York-based Columbia University President Minouche Shafik issued a statement at 11:07 p.m. (0307 GMT Friday) retreating from a midnight deadline to dismantle a large tent camp with around 200 students.

“The talks have shown progress and are continuing as planned,” the statement said. “We have our demands; they have theirs.”

The statement denied that New York City police were invited on the campus. “This rumor is false,” it said.

A student, identifying herself only as Mimi, told AFP she had been at the camp for seven days.

“They call us terrorists, they call us violent. But the only tool we actually have are our voices,” she said.

Student protesters say they are expressing solidarity with Palestinians in Gaza, where the death toll has topped 34,305, according to the Hamas-run territory’s health ministry.

More than 200 people protesting the war were arrested Wednesday and early Thursday at universities in Los Angeles, Boston and Austin, Texas, where around 2,000 people gathered again Thursday.

Riot officers in the southern state of Georgia used chemical irritants and tasers to disperse protests at Emory University in Atlanta.

Photographs showed police wielding tasers as they wrestled with protesters on neatly manicured lawns.

The Atlanta Police Department said officers responding to the school’s request for help were “met with violence” and used “chemical irritants” in their response.

The spreading protests began at Columbia University, which has remained the epicenter of the student protest movement.

Free speech?

The protests pose a major challenge to university administrators who are trying to balance campus commitments to free expression with complaints that the rallies have crossed a line.

Pro-Israel supporters and others worried about campus safety have pointed to antisemitic incidents and allege that campuses are encouraging intimidation and hate speech.

“I’ve never felt more scared to be a Jew in America right now,” said Skyler Sieradsky, a 21-year-old student of philosophy and political science at George Washington University.

“There are students and faculty standing by messages of hate, and standing by messages that call for violence.”

Demonstrators, who include a number of Jewish students, have disavowed antisemitism and criticized officials equating it with opposition to Israel.

“People are here in support of Palestinian people from all different backgrounds… (compelled by) their general sense of justice,” a 33-year-old graduate student at the University of Texas, Austin, who said he was Jewish and gave his name as Josh, told AFP. 

U.S. ally Israel launched its war in Gaza after the Hamas attack on October 7 that left around 1,170 people dead, according to an AFP tally of Israeli official figures.

Hamas militants also took roughly 250 people hostage. Israel estimates 129 remain in Gaza, including 34 presumed dead.

Coast to coast

At the University of Southern California in Los Angeles, 93 people were arrested for trespassing on Wednesday, authorities said they were canceling events at the May 10 graduation ceremony.

The ceremony, which usually attracts 65,000 people, made headlines this month when administrators canceled a planned speech by a top student after complaints from Jewish groups that she had links to antisemitic groups. She denied the charge.

At Emerson College in Boston, local media reported classes were canceled Thursday after police clashed with protesters overnight, tearing down a pro-Palestinian encampment and arresting 108 people.

In Washington, students from Georgetown and George Washington University (GW) established a solidarity encampment on the GW campus Thursday.

Protests and encampments have also sprung up at New York University and Yale — both of which also saw dozens of students arrested earlier this week — Harvard, Brown University, MIT, the University of Michigan and elsewhere.

California State Polytechnic University, Humboldt said its campus could remain closed into next week due to protesters occupying buildings.

On Sunday, U.S. President Joe Biden denounced “blatant antisemitism” that has “no place on college campuses.”

But the White House has also said the president supports freedom of expression at U.S. universities.
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washington — U.S. Secretary of State Antony Blinken’s arrival in China on Wednesday has been met with skepticism, cynicism and suggestions that the absence of a red carpet for the top U.S. diplomat’s arrival was a not-so-subtle message from Beijing.

Blinken kicked off his three-day visit to China in Shanghai with online commenters and analysts noting China had omitted the usual practice of laying out a red carpet for a distinguished visitor.

Posting on X, Hu Xijin, a former editor-in-chief of Chinese state media Global Times, said, “Blinken has arrived in Shanghai, China. Many people noticed when he stepped off the plane that there seemed to be no red carpet on the ground. His China visit should be seen as an ‘imploring’ one, although the U.S. made some tough public opinion preparations in advance.”

Gordon Chang, a distinguished senior fellow at the New York-based Gatestone Institute think tank, responded to Hu Xijin’s post, “#China, before #Blinken even stepped off his plane in #Shanghai today, insulted him.”

An X user under the name Lord Bebo, who claims to be anti-mainstream media, posted, “Blinken arrives in China and is met WITHOUT RED CARPET. No band or anything … he’s welcomed like a somebody unimportant.” His post received more than 10,000 likes.

U.S.-China relations have eased since the two sides resumed high-level contacts, but many differences remain.

Before Blinken’s visit, U.S. media reported that the U.S. discussed sanctioning some Chinese banks to counter their support for Russia. Blinken also stated in releasing the State Department’s 2023 Country Reports on Human Rights Practices that the Uyghurs in Xinjiang are victims of genocide and crimes against humanity.

He arrived in China the same day President Joe Biden signed a bill into law that includes Taiwan military aid and pushes TikTok’s parent company, ByteDance, to divest its U.S. operations.

“What an awkward moment for Blinken as he lands in China,” Canadian geopolitics expert Abishur Prakash said. “The U.S. is full-steam ahead on taking on China, led by the bills around TikTok, Taiwan and support nations in the Indo-Pacific against Beijing.”

‘Face-to-face diplomacy matters’

On his day of arrival, Blinken posted a video speech against a backdrop of Shanghai’s iconic buildings, such as the neon-lit Oriental Pearl Tower and the Shanghai World Financial Center.

“We just arrived here in Shanghai in the People’s Republic of China to work on issues that matter to the American people,” he said in the video. “One of those is fentanyl, synthetic opioids, the leading killer of Americans between the ages of 18 and 49.

“President [Joe] Biden, President Xi [Jinping], when they met in San Francisco at the end of last year, agreed to cooperate to help prevent fentanyl and the ingredients that make it from getting to the United States. We will be working on that.”

Blinken said he would be talking not only to his counterparts in the Chinese government, but also to students, academics, business leaders and “the people who are building bridges and ties between our countries.

“And of course, we will be dealing with areas where we have real differences with China, dealing with them directly, communicating clearly. Face-to-face diplomacy matters,” he said. “It’s important to avoid miscommunications, misperceptions, and to advance the interests of the American people.”

Reaction takes anti-American tone

On Chinese social media, Blinken’s overtures were met with cynicism.

On Weibo, China’s largest social platform, Blinken’s second visit to China had limited coverage, and the discussion was dominated by an anti-American tone.

A Weibo user under the name of Xiao Fan Hao She argued that the United States has not officially listed all fentanyl-like substances on the control list.

“We ask whether the United States believes that it can solve the domestic problems in the United States by shifting the blame externally, shirking responsibility, and smearing China’s image,” she wrote.

A Weibo user under the name of An Hao Xin said, “Coming with him is also the bargaining chip of ‘bank sanctions.’ To be honest, if you want to kick SWIFT out, just do it quickly. Why are you hesitating?”

Another commenter said, “If you dare to overturn the table, then we just aid Russia with weapons and see who suffers.”

Kenneth Roth, a former executive director of Human Rights Watch and visiting professor at Princeton University, linked the visit to U.S. Middle East policy, saying on X that Blinken “would have an easier time telling the Chinese government not to provide military supplies to Russia as it commits war crimes in Ukraine if the U.S. government were not arming Israel as it commits war crimes in Gaza.”

But Roth also said, “It will be shameful if Blinken is so determined to make nice to Beijing that he doesn’t publicly mention its crimes against humanity targeting Uyghur Muslims in Xinjiang.”

Jonathan Cheng, the China bureau chief for The Wall Street Journal, said on X, “Unnamed Chinese official to Blinken: ‘Perception is always the first button that must be put right. Whether China and the United States are rivals or partners is a fundamental issue, on which there must not be any catastrophic mistake.’ ”

Adrianna Zhang contributed to this report.
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nairobi, kenya — About 1,300 delegates and 400 companies participated in the fourth American Chamber of Commerce summit in Nairobi, Kenya, where Kenya’s president William Ruto says his country is ready for business — and means business.

“The 2024 summit’s theme — catalyzing the future of U.S. East Africa Trade and Investment intentionally — draws on the previous edition to develop a strategic platform for commercial advocacy, which will strengthen bilateral trade between Kenya and the U.S., as well as between our region and the U.S.,” said Ruto.

U.S. Secretary of Commerce Gina Raimondo participated in this year’s summit — which ended Thursday — saying it’s not enough to state the intentions of the United States to invest more and collaborate with Kenya.

“You also have to show up and that’s why I am here,” she said. “And when we show up, we also have to listen and learn.”

Raimondo announces US-Kenya partnership

In her first official trip to East Africa, Raimondo reiterated President Joe Biden’s December 2022 message that the U.S. is all-in on Africa. To that end, she said she traveled with 14 members of the President’s Advisory Council on doing business in Africa.

“Africa has changed the narrative and the companies that are here today know that,” said Raimondo. “And they reflect the optimism and the commitment from the U.S. business community about the opportunities in Kenya and across the continent.”

Raimondo also announced a partnership “to harness artificial intelligence, facilitate data flows and empower digital upskilling with Kenya.”

The partnership, she said, is the first of its kind with an African nation to promote the safe development and deployment of AI. In addition, seven private-sector deals on digital transformation and commitments were made involving companies including the NBA, CISCO, Pfizer, and Qualcomm.

Two new grants by the U.S. Trade and Development Agency were announced to expand semiconductor fabrication in Kenya and the construction of a fiber network along the railways.

Rebecca Miano, Kenya’s cabinet secretary with the Ministry of Investments, Trade, and Industry, told participants that Kenya should be a destination for investors and not only because of its young, educated and innovative workforce.

“We also have a green story: decarbonizing the world,” Miano said. “Kenya is a key player.”

Miano said that up to 95 percent of the electricity consumed in Kenya is renewable.

“We have a target to make it 100% in the next few years,” she said.

Summit explores tech, climate, energy

The two-day AmCham summit brought together businesses to stimulate commercial opportunities, said Maxwell Okello, CEO of AmCham Kenya.

This year’s summit focused on key areas such as the tech space, climate action and green energy, said Okello.

“I am sure you’ve walked around and seen the pavilion under the title ‘Digital Transformation Africa,’ which brings together technology ecosystems both Kenyan but American as well,” said Okello. “Secondly, we have shone the light on … matters related to climate action and green business because we know we need to be green as we are moving forward.”

Out of 400 companies at the event, Wandia Gichuru, CEO of Vivo Fashion Group, got a special shout-out from U.S. Ambassador to Kenya Meg Whitman, who said she was wearing a top made by Gichuru’s apparel company.

“We were very excited, not only she was wearing something Vivo, but she also made the announcement that we would be opening our very first U.S. store in Atlanta this May,” said Gichuru. “… and we hope that the ambassador and our president will visit the store while they are in the U.S. for the state visit in May.”

President Ruto is set to visit the United States next month in the first state visit since he was elected.
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Washington — The United States on Thursday issued further sanctions on Iran, targeting Iranian drones, including their use by Russia in the war in Ukraine, as Washington seeks to ratchet up pressure on Tehran. 

In a statement, the U.S. Treasury Department said the action, taken in coordination with the United Kingdom and Canada, targets over one dozen entities, individuals and vessels it accused of playing a key role in facilitating and financing the clandestine sale of Iranian unmanned aerial vehicles to Iran’s Ministry of Defense and Armed Forces Logistics (MODAFL). 

MODAFL in turn supports Iran’s elite Revolutionary Guards (IRGC) and Russia’s war in Ukraine, the Treasury said.

“Iran’s Ministry of Defense continues to destabilize the region and world with its support to Russia’s war in Ukraine, unprecedented attack on Israel, and proliferation of UAVs and other dangerous military hardware to terrorist proxies,” said Treasury’s Under Secretary for Terrorism and Financial Intelligence,Brian Nelson. 

Washington also targeted two companies and a vessel involved in the shipment of Iranian commodities, the Treasury said.

“The United States, in close coordination with our British and Canadian partners, will continue to use all means available to combat those who would finance Iran’s destabilizing activities,” Nelson said.

Iran’s mission to the United Nations in New York did not immediately respond to a request for comment. 

Sahara Thunder plays key role 

The Treasury said it targeted a company named Sahara Thunder, accusing it of being a main front company that oversees MODAFL’s commercial activities in support of the IRGC and Russia’s war in Ukraine. 

It said the company plays a key role in Iran’s design, development, manufacture and sale of thousands of drones, many of them ultimately transferred to Russia for use against Ukraine. 

As of 2022, Russian officials were negotiating a deal for Sahara Thunder to deliver and produce thousands of drones per year at a facility in Russia under U.S. sanctions, the Treasury said. 

Sahara Thunder’s leadership and shipping network, which the Treasury said the company relied on for the sale and shipment of Iranian commodities on behalf of MODAFL to jurisdictions including China, Russia and Venezuela, were also targeted. 

An Iran-based company involved in the procurement and development of unmanned aerial vehicles, its leadership and an Iranian cargo airline were also among those hit with sanctions.

The U.S. earlier this month had warned it would impose further sanctions on Iran following its unprecedented attack on Israel. 

Washington has since taken measures, including targeting Iran’s drone program, steel industry and cyber actors. 

Iran this month launched more than 300 drones and missiles against Israel, its first direct attack on the country, in retaliation for a suspected Israeli airstrike on its embassy compound in Damascus on April 11 that killed elite military officers.
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washington — The Biden administration is not taking any options off the table to respond to China’s excess industrial capacity, which is a top concern for the U.S. and its allies, U.S. Treasury Secretary Janet Yellen told Reuters on Thursday.

China exporting its way to full employment is not acceptable to the rest of the world, Yellen said in a Reuters Next interview in Washington.

Yellen said that during her trip to China earlier this month, she was “successful” in raising U.S. concerns with Chinese officials about Beijing flooding global markets with electric vehicles (EVs), solar panels and other clean energy goods, threatening U.S. jobs. She added that Chinese officials acknowledge a problem with industrial overcapacity, but they need to address it.

She said the issue, which threatens producers of similar goods in the U.S., Europe, Japan and emerging markets such as India and Mexico, was again “discussed intensively” with Chinese officials in Washington on the sidelines of the International Monetary Fund and World Bank spring meetings last week.

Yellen added that the problem will not be resolved “in a day or a week.”

“So it’s important that China recognize the concern and begin to act to address it,” Yellen said. “But we don’t want our industry wiped out in the meantime, so I wouldn’t want to take anything off the table.”

The Biden administration is completing a review of the “Section 301” unfair trade tariffs on Chinese imports imposed by former President Donald Trump in 2018, which U.S. officials have said could lead to higher tariffs on some products. President Joe Biden last week called for the review to triple the Section 301 duties on Chinese steel to 25%.

U.S. Trade Representative Katherine Tai also told U.S. senators that the U.S. needed to take “early action, decisive action” to protect the fledgling American EV sector from Chinese imports. U.S. tariffs on Chinese vehicle imports are now about 27.5%, and few Chinese EVs are sold in the U.S. at the moment.

“We have no problem with China producing and selling globally and exporting, but the United States and Europe and other countries also want to have some involvement in the ability to produce clean energy products that are going to be of great importance,” Yellen said.

 
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WASHINGTON — The nation’s economy slowed sharply last quarter to a 1.6% annual pace in the face of high interest rates, but consumers — the main driver of economic growth — kept spending at a solid pace.

Thursday’s report from the Commerce Department said the gross domestic product — the economy’s total output of goods and services — decelerated in the January-March quarter from its brisk 3.4% growth rate in the final three months of 2023.

A surge in imports, which are subtracted from GDP, reduced first-quarter growth by nearly 1 percentage point. Growth was also held back by businesses reducing their inventories. Both those categories tend to fluctuate sharply from quarter to quarter.

By contrast, the core components of the economy still appear sturdy. Along with households, businesses helped drive the economy last quarter with a strong pace of investment.

The import and inventory numbers can be volatile, so “there is still a lot of positive underlying momentum,” said Paul Ashworth, chief North America economist at Capital Economics.

The economy, though, is still creating price pressures, a continuing source of concern for the Federal Reserve. A measure of inflation in Friday’s report accelerated to a 3.4% annual rate from January through March, up from 1.8% in the last three months of 2023 and the biggest increase in a year. Excluding volatile food and energy prices, so-called core inflation rose at a 3.7% rate, up from 2% in fourth-quarter 2023.

From January through March, consumer spending rose at a 2.5% annual rate, a solid pace though down from a rate of more than 3% in each of the previous two quarters. Americans’ spending on services — everything from movie tickets and restaurant meals to airline fares and doctors’ visits — rose 4%, the fastest such pace since mid-2021.

But they cut back spending on goods such as appliances and furniture. Spending on that category fell 0.1%, the first such drop since the summer of 2022.

The state of the U.S. economy has seized Americans’ attention as the election season has intensified. Although inflation has slowed sharply from a peak of 9.1% in 2022, prices remain well above their pre-pandemic levels.

Republican critics of President Joe Biden have sought to pin responsibility for high prices on Biden and use it as a cudgel to derail his re-election bid. And polls show that despite the healthy job market, a near-record-high stock market and the sharp pullback in inflation, many Americans blame Biden for high prices.

Last quarter’s GDP snapped a streak of six straight quarters of at least 2% annual growth. The 1.6% rate of expansion was also the slowest since the economy actually shrank in the first and second quarters of 2022.

The economy’s gradual slowdown reflects, in large part, the much higher borrowing rates for home and auto loans, credit cards and many business loans that have resulted from the 11 interest rate hikes the Fed imposed in its drive to tame inflation.

Even so, the United States has continued to outpace the rest of the world’s advanced economies. The International Monetary Fund has projected that the world’s largest economy will grow 2.7% for all of 2024, up from 2.5% last year and more than double the growth the IMF expects this year for Germany, France, Italy, Japan, the United Kingdom and Canada.

Businesses have been pouring money into factories, warehouses and other buildings, encouraged by federal incentives to manufacture computer chips and green technology in the United States. On the other hand, their spending on equipment has been weak. And as imports outpace exports, international trade is also thought to have been a drag on the economy’s first-quarter growth.

Kristalina Georgieva, the IMF’s managing director, cautioned last week that the “flipside″ of strong U.S. economic growth was that it was “taking longer than expected” for inflation to reach the Fed’s 2% target, although price pressures have sharply slowed from their mid-2022 peak.

Inflation flared up in the spring of 2021 as the economy rebounded with unexpected speed from the COVID-19 recession, causing severe supply shortages. Russia’s invasion of Ukraine in February 2022 made things significantly worse by inflating prices for the energy and grains the world depends on.

The Fed responded by aggressively raising its benchmark rate between March 2022 and July 2023. Despite widespread predictions of a recession, the economy has proved unexpectedly durable. Hiring so far this year is even stronger than it was in 2023. And unemployment has remained below 4% for 26 straight months, the longest such streak since the 1960s.

Inflation, the main source of Americans’ discontent about the economy, has slowed from 9.1% in June 2022 to 3.5%. But progress has stalled lately.

Though the Fed’s policymakers signaled last month that they expect to cut rates three times this year, they have lately signaled that they’re in no hurry to reduce rates in the face of continued inflationary pressure. Now, a majority of Wall Street traders don’t expect them to start until the Fed’s September meeting, according to the CME FedWatch tool.
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