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U.S. retail sales surged in October, the Commerce Department reported Tuesday, in a signal that at least at the start of the annual holiday shopping season, consumers were not scared off by sharply increasing prices.

Retail sales increased 1.7% last month, more than twice the advance of eight-tenths of a percent in September. Sales have now increased three straight months.

Brian Deese, director of the White House’s National Economic Council, touted the favorable report, saying, “In short, families have seen an increase in real disposable income, and stores and restaurants have the supplies to drive this recovery.”

He said that the retail sales report showed “that even as we work to address the real challenge that elevated inflation from supply chain bottlenecks poses for Americans’ pocketbooks and outlook, the economy is making progress.”

With U.S. consumer price inflation at a three-decade high, it is an open question whether robust consumer spending will continue during the holiday shopping season through the end of 2021.

The government reported last week that consumer prices increased at an annualized rate of 6.2% in October, with sharply higher prices for gasoline and food affecting consumers the most.

The Commerce Department said that October spending was up 4% at online retailers, along with big gains at electronics, appliance and hardware stores. Gas price increases pushed up the sales total at service stations by 3.9% while vehicles sales revenue increased 1.8%.

Aside from higher prices, U.S. consumers are facing shortages of many items they may want to buy.  

Several dozen container ships filled with consumer goods from Asia are anchored off the U.S. Pacific coast waiting for docking and unloading at California ports, a supply chain snarl that government officials are gradually unraveling but are far from fully resolving.
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Rising inflation in the U.S. may be putting the brakes on Democrats’ effort to push President Joe Biden’s signature package of climate and social spending measures through Congress before the end of the year, even though it’s not clear that the measures would add to rising prices. 

House Democrats are pushing for a vote on the package, known as the Build Back Better Act, in an effort to move it forward in advance of the Thanksgiving recess next week. Democratic leaders had hoped to secure a vote on the bill last week, but more moderate Democrats demanded a delay until the Congressional Budget Office (CBO) could complete its analysis of the bill’s expected effects on the federal budget. 

On Monday, the CBO said that its analysis would be completed by Friday of this week, clearing the way for a vote, so long as the agency finds that the bill fully offsets its spending with increased revenues, as Democrats have promised. 

Biden expressed hope Monday during a signing ceremony for a $1.2 trillion bipartisan infrastructure package that the bill would pass.

“I’m confident that the House will pass this bill, and then we’re going to have to pass it in the Senate,” he said in remarks delivered on the White House lawn. “It is fully paid for, it will reduce the deficit over the long term, according to leading economists … and again, no one earning less than $400,000 will pay a single penny more in federal taxes. Together, with the infrastructure bill, millions of lives will change for the better.” 

However, the bill may be facing trouble in the Senate, where West Virginia Senator Joe Manchin and Arizona Senator Kyrsten Sinema, both moderate Democrats, have expressed reservations about the $1.75 trillion package because they fear it might exacerbate price increases. 

If either of them were to vote against it, the package would fail, because the Democrats control only 50 of the 100 votes in the Senate and have to count on Vice President Kamala Harris to cast the deciding vote in the case of a tie. 

Last week, after the Labor Department announced that inflation for the fiscal year ending in October had reached a 30-year high of 6.2%, Manchin tweeted out a message that many in Washington read as a warning to his fellow Democrats. 

“By all accounts, the threat posed by record inflation to the American people is not ‘transitory’ and is instead getting worse,” he wrote. “From the grocery store to the gas pump, Americans know the inflation tax is real and DC can no longer ignore the economic pain Americans feel every day.” 

However, it is far from clear that the Build Back Better agenda would be inflationary, despite Manchin’s and Sinema’s concerns or the assertions of Republicans in Congress. 

The bill would dedicate $555 billion to addressing climate change – money that would be spread out over a decade. It would also provide universal pre-K child care, paid family and medical leave, financial benefits to families with young children, and more. It would be paid for, among other things, by a 15% minimum tax on business profits. 

“Republicans are saying it’s highly inflationary in and of itself, and I don’t buy that,” Joseph E. Gagnon, a senior fellow at the Peterson Institute for International Economics, told VOA. “It’s not that big, when you think about how it’s spread out, and there are some tax increases that go along with it.” 

The White House has been touting a letter from 17 Nobel Prize-winning economists that said that the inflationary effects of the bill would be “negligible” over the medium term. However, the letter omitted the potential for near-term inflationary effects and was based on an early version of the bill in which tax increases figured much more prominently than they do in the current, smaller version. 

To some, the picture is less clear. 

“There are elements in the bill that I think should tend to relieve inflationary pressures, and there are elements in the bill that I think should tend to worsen inflationary pressures,” Marc Goldwein, senior vice president and senior policy director for the Committee for a Responsible Federal Budget, told VOA. “Analytically, I think it’s ambiguous, which is more powerful.” 

Goldwein said that he thinks the inflationary pressures might be marginally stronger but said, “I don’t think the bill is going to have a substantial effect either way. There’s a risk, because we are in a very high-inflation environment, and sometimes that last log you put in the fire is the one that causes it to spread. … But when you look at it as a whole, I don’t think it’s going to tend to push inflation up or down very much.” 

Biden has actually gone so far as to hint that the bill would help to improve the current high inflation being experienced by Americans.

Last week, for example, the president tweeted, “Congress has a tool at its disposal to lower costs for families right away: The Build Back Better Act. All we’ve got to do is pass it.” 

However, this is a bit of a two-step by the president. To the extent that the Build Back Better Act might reduce costs for American consumers, it would be doing so by having the government absorb some of the cost of things like child care and prescription drugs, not by reducing inflation in the near term. 

According to Gagnon of the Peterson Institute, “I don’t see that it would have an effect on near-term inflation.” 

 
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China’s output of coal increased to its highest level since at least March 2015 after authorities gave permission for mine expansions to boost supply and ease record prices. Chinese coal imports from Russia surged in September, but one of its traditional suppliers — Australia — remains frozen out of the lucrative trade because of diplomatic tensions.

China — the world’s leading consumer of coal — has an energy shortage triggered by strong demand from its manufacturers, industry and households. 

The government in Beijing is determined to avoid more power cuts. 

Since July, China has approved expansions at more than 150 coal mines, according to the National Development and Reform Commission. Figures from China’s National Bureau of Statistics showed domestic coal production exceeded 357 million tons in October, up from 334 million tons the previous month.

​Official customs data has also shown that China imported about 3.7 million tons of thermal coal from Russia — the main fuel for electricity generation — in September, up more than a quarter from August.

However, one of the world’s main coal producers — Australia — is noticeably absent from the list of nations shipping coal to China.

It was a prolific exporter of coal to China before an unofficial ban was imposed in late 2020 after Canberra supported calls for an international inquiry into the origins of COVID-19, the disease first detected in China. Beijing interpreted the move as criticism of its handling of the virus, and a range of trade restrictions were brought in.

China does have long term plans to slash its use of coal and fossil fuels. 

Sam Geall from China Dialogue, an environmental policy group, told the Australian Broadcasting Corp. that China’s consumption of coal will oscillate to reflect domestic political necessities. 

“There is room for hedging over the next five years that can allow kind of increased coal build up that would then need to be kind of ramped down again after 2025, and that speaks to this issue of the kind of push and pull that we see in the Chinese power sector with the recent black-outs and so on. It is difficult to just immediately, you know, turn the juggernaut around and there is a push and pull between different forces and different imperatives, including, you know, social stability, employment (and) keeping the lights on,” said Geall.

The increase in China’s coal production comes as India, supported by Beijing and other coal-dependent developing nations, brokered a last-minute amendment at the COP26 climate talks in Glasgow, Scotland. 

They managed to alter the final wording of the accord to “phase down” rather than “phase out” the use of coal. 
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Prices have gone up for a number of consumer products in the United States. President Joe Biden, whose poll numbers are slipping over concerns about how he is handling the economy, is pushing for the passage of his large social spending plan. Michelle Quinn reports.

Produced by: Mary Cieslak    
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U.S. President Joe Biden is hosting a ceremony Monday at the White House where he will sign a bipartisan $1 trillion infrastructure bill that earned final passage in Congress after months of negotiations. 

The legislation calls for massive spending across the country to address crumbling roads and bridges, improve rail service and expand public transportation. 

The White House said Monday’s signing event would include governors and mayors from both the Democratic and Republican parties, as well as leaders from labor unions and businesses.

The bill includes billions of dollars to address gaps in access to broadband internet, particularly for low-income households, rural areas and tribal communities. 

There are also programs to shore up the nation’s electricity grid, as well as its water and wastewater systems. Airports are also set to see improvements, and money is pledged for building electric vehicle charging stations and to purchase electric and hybrid school buses. 

The White House announced Sunday the selection of former New Orleans Mayor Mitch Landrieu to oversee the infrastructure plan. 

Biden and some of his Cabinet secretaries have already been holding events to highlight the benefits of the package. After signing the bill Monday, he is scheduled to head to the state of New Hampshire on Tuesday to visit a bridge listed among those badly in need of repair. On Wednesday he has an event scheduled at an electric car plant in Michigan. 

Some information for this report came from the Associated Press and Reuters. 
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The top White House economic adviser on Sunday acknowledged the pain for Americans of sharply rising consumer prices, saying that President Joe Biden remains open to the possibility of tapping the U.S. Strategic Petroleum Reserve to ease spiraling gasoline prices that motorists are paying at service stations.

“There’s no doubt inflation is high right now,” Brian Deese, director of the National Economic Council, told NBC’s “Meet the Press” show. “It’s affecting Americans’ pocketbooks. It’s affecting their outlook.”

U.S. consumer prices jumped at an annualized rate of 6.2% in October, the biggest increase since 1990, the government’s Labor Department reported last week.

Higher energy and food prices have affected consumers the most, with consumer spending accounting for 70% of the U.S. economy, the world’s biggest.

Fuel costs for motorists are up sharply over the last year, with motorists now paying $3.30 a gallon (3.8 liters), $1.08 more than a year ago, the highest average price since 2014. The cost of grocery bills has risen 5.3% over the last year, with beef prices increasing markedly, further pinching household budgets.

Deese offered no immediate solution for the higher consumer prices, but said economic forecasters expect the inflation rate to decrease in 2022.

He said “all options are on the table” to curb rising prices, including tapping the Strategic Petroleum Reserve, where the U.S. currently has 612 million barrels of oil stored in four salt caverns along the Gulf of Mexico coast. 

Some release of the reserve oil could be refined into gasoline for sale to motorists, which could in the short term ease gas prices at service station pumps. But U.S. presidents have only reluctantly tapped the reserve, instead holding it for use in the event of a possible true national emergency, such as a cutoff in Middle East and north Atlantic oil production.

The existing oil reserve is enough to replace more than half a year’s worth of U.S. crude net imports.

Deese said three things have to occur to improve U.S. economic growth and curb inflation.

”One, we have to finish the job on COVID,” he said, with more vaccinations to curb the spread of the coronavirus that causes the illness. “We have to return to a sense of economic normalcy by getting more workplaces COVID-free; getting more kids vaccinated so more parents feel comfortable going to work.”

But Biden’s mandate that 84 million U.S. workers be vaccinated at workplaces with 100 or more employees has been at least temporarily blocked by a U.S. appellate court pending further court hearings.

Secondly, Deese said, “We’ve got to address the supply chain issue” of consumer goods arriving into the U.S. from Asia, with 83 container ships currently anchored off the Pacific Coast waiting for docking and unloading.

He said the $1.2 trillion infrastructure legislation Biden is signing Monday will help ease transportation bottlenecks in the U.S., but that construction work does not occur overnight.

Lastly, he called for congressional passage of Biden’s nearly $2 trillion social safety legislation to provide more financial, educational and health care assistance to all but the wealthiest American families. The House of Representatives is planning to vote on the measure this week, but its fate in the Senate remains uncertain.

Despite the immediate inflationary pressures on American consumers and Biden’s sharply declining voter approval standing, Deese said the economy has sharply improved since Biden took office last January.

“When the president took office, we were facing an all-out economic crisis,” Deese said. “Eighteen million people were collecting unemployment benefits. Three thousand people a day were dying of COVID. And because of the actions the president has taken, we’re now seeing an economic recovery that most people didn’t think was possible then.”

“Economic growth in America is outstripping any other developed country,” Deese said. “And the unemployment rate has come down to 4.6%; that’s about two years faster than experts projected.”

But with higher consumer prices, the Democratic president’s Republican political foes are focusing on American pocketbooks as congressional elections halfway through Biden’s four-year presidential term loom in November of next year.

One Republican critic, Senator John Barrasso of Wyoming, told ABC’s “This Week” show, he would never have believed Biden would preside over the biggest increase in consumer prices in three decades.

But Barrasso blamed what he characterized as Biden’s “almost irreversibly bad” federal government spending choices, both for infrastructure and the pending social safety legislation. 

The infrastructure legislation was approved with both Republican and Democratic support, but no Republicans have voiced support for the social safety net measure, forcing Democrats to attempt to pass it with their own votes.
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The Covid-19 pandemic has changed the nature of homebuying in the United States, but one constant is that Black Americans do not have the same access to a home of their own.

Black purchasers made up just six percent of the total homebuyers this year — a figure that has changed little over the past two decades, a National Association of Realtors (NAR) report released Thursday said.

Pandemic dynamics have allowed many Americans to get caught up on student loans and build savings, since spending opportunities like travel and eating in restaurants were off limits.

As remote work became the norm, more buyers packed up and moved to be closer to family and friends rather than relocating for a job, according to NAR’s 2021 Profile of Home Buyers and Sellers.

However Black Americans are weighed down by student loan debt to a greater degree than their white counterparts, and less able to get help from family, the report said.

“Unfortunately, race hasn’t really changed much this year. We’re still seeing pretty consistent, low shares of minority homebuyers,” NAR’s Jessica Lautz told AFP in an interview.

While low interest rates made mortgages more accessible, the now-chronic shortage of homes for sale has driven prices higher and kept many first-time buyers out of the market, the data showed.

Even in the South, Blacks made up just nine percent of homebuyers in a region where their population in some states is more than double the 13 percent national average, the report said.

Prior NAR research shows white homeownership rates are 30 percentage points higher than those of Black buyers, who are more than twice as likely to have student loan debt and a higher amount, and are rejected for mortgages at more than twice the rate as white applicants.

And because they are less likely to own homes, they are not able to use proceeds from the sale of a home to finance a purchase.

Priced out

While the share of first-time buyers rose this year, it remains below the historic norm of 40 percent, said Lautz, NAR’s vice president of demographics and behavioral insights.

“We know that first-time homebuyers are struggling to enter into this housing market,” she said, adding they find it hard “to pull the money together and then to be able to compete with other buyers” who increasingly can pay all cash.

With historically low inventory — exacerbated by a shortage of workers and supply issues and tendency for builders to focus on large, expensive houses — sellers are getting full asking price and more for their homes, and a higher share of buyers can pay cash.

The median home price was $305,000, more than $30,000 higher than in 2020, according to the report.

President Joe Biden has made lowering home prices a plank of his Build Back Better bill under consideration in Congress, calling for $150 billion for “the single largest and most comprehensive investment in affordable housing in history.”

His plan would offer down payment assistance to help more buyers own their first home and build wealth, and focus on zoning reform to allow more construction.

Close to family

One of the biggest shifts during the pandemic has been the increase in demand for work-from-home opportunities as offices shut down.

“Home sellers are saying their number-one reason to sell is to get closer to friends and family,” Lautz said. “People really wanted their support system around them and needed it during the pandemic.”

Job relocation as the reason to move fell to seven percent from 11 percent.

She said she expects that trend to continue “as CEOs understand if they want to retain talent, they may need to allow more flexibility in working from home.”

Another trend is the dwindling share of homebuyers with children, which fell to 31 percent — the lowest on record, she said.

That shifts priorities, since those buyers will be less concerned about issues like schools or larger homes, which for cash-strapped buyers will “open up neighborhoods for them that would have been off limits if they had children in the home.”
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Although Australia seems likely to back Taiwan’s, rather than China’s bid, to join a major pan-Pacific trade bloc, Canberra must focus solely on their qualifications rather than link its decision to other issues, analysts say.

China and Taiwan are both lobbying for Australia’s backing of their inclusion in the 11-member Comprehensive and Progressive Agreement for Trans-Pacific Partnership, one of the largest free-trade areas in the world, which was signed in 2018.

Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam currently make up the CPTPP.

China’s courting of Australia’s support comes despite Beijing’s blocking of agricultural goods that have cost Australian exporters billions of dollars. It also coincides with a period of severely strained relations because of the new AUKUS security pact among Australia, the United States and Britain, which has infuriated Beijing. 

Any temptation to bargain with China to lift punitive sanctions against Australian wine, barley and lobster exports in exchange for championing its entry into the CPTPP risks rewarding Beijing’s trade coercion, according to an expert.

“Outright favoring China over Taiwan may help regain some favor in Beijing in the short run, but at what cost? Australia will only lose in the long run by horse-trading support for China in return for some loosening of the trade blockages imposed by Beijing,” Hugh Piper, a former strategic policy adviser in Australia’s Foreign Affairs and Trade Department, told VOA. 

“It sends an awful message to Beijing that it can extract concessions from Australia simply by restraining trade,” Piper said. 

Publicly endorsing Taiwan’s campaign for admission to the CPTPP could also backfire, he said.

“Australia should be cautiously supportive of Taiwan’s bid, but certainly no more enthusiastic than for any other prospective member,” Piper said. 

“Australia would lose whatever moral and rhetorical high ground it retains in its ongoing trade dispute with China if it was seen to be using the CPTPP as a vehicle for political retaliation,” he said. 

Taiwan is a significant regional economy and would be seen as a welcome addition to the cross-Pacific bloc, especially by Australia, which does not have a bilateral free trade agreement with the island, he said.  

Despite the absence of a bilateral Australia-Taiwan trade agreement, Taiwan is already a strong market for Australian exports. Taiwan was Australia’s 12th largest trading partner in 2020, worth $11.9 billion, and it was Australia’s ninth largest merchandise export market in 2020, worth $7.3 billion, according to Australia’s Department of Foreign Affairs and Trade. Major exports were coal, iron ore, natural gas, aluminum and copper.

“There’s certainly no need for Australia to dial up the rhetoric on Taiwan’s bid, publicly anyway. Australia’s focus should be on working intensely behind the scenes to convince other current members to look favorably on Taiwan’s bid, provided they can demonstrate that they meet the entry requirements,” he said.

Jennifer Hsu, a foreign policy research fellow at the Lowy Institute think tank, said Canberra has already indicated cautious support for Taiwan’s application.

“Trade Minister Dan Tehan has intimated that the Australian government and its representatives are seeking bilateral support [from other CPTPP member states] for Taiwan’s application to join the CPTPP,” Hsu told VOA. 

“So I think there is shifting perspectives, at least from the Australian government’s side, to see Taiwan as one of critical importance to the region and also to advancing Australia’s exports interests.”

While expanded tariff-free trade with Taiwan would not offset the losses from Chinese trade sanctions, it would open access to Taiwan’s technology products and provide new markets for Australia’s barley, lobster and wine.

Such a move chimes with Treasurer Josh Frydenberg’s public plug to Australian exporters to diversify and lessen their reliance on Chinese markets, saying in a public address, “It is no secret that China has recently sought to target Australia’s economy.”  

Supporting Taiwan’s admission into the trading bloc “is one demonstration of this process and this thinking,” Hsu said.

The bloc imposes entry requirements that include a commitment to workers’ rights, freedom of association, and a ban on forced labor.

Few believe that China would sign up to those commitments.   

China’s bid is “likely to come unstuck at the point of substantive commitments to market reforms that CPTPP membership demands,” Piper said. 

“Given [China’s] ongoing prioritization of state control over market liberalization under [President] Xi Jinping, the kind of reform required for the sake of a trade agreement seems unlikely to be prioritized over the desire for control over the economy. 

“That leads to the implication that China’s bid is more about strategy than economics: a move to further stymie Taiwan’s international space and voice.”

China will need to pull back on any reprisal language or behavior aimed at Australia while it seeks to join the pact, Hsu said.

“The Chinese government will articulate stronger and angrier words against Australia’s support for Taiwan’s application, but the Chinese government has to balance that with what it seeks from joining the trading bloc,” she said.

“How much more can China say about Australia without harming its application to join the trading bloc? That’s the framework one has to think about: how far will China push its language and economic coercion before it backfires?” she said.
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Agricultural commodities such as coffee, cotton and wheat faced sharp price swings this year as output was hit by extreme weather sparked partly by climate change. 

According to analysts, volatile weather conditions and temperatures have adversely impacted crop growth, harvest and supply in key exporters. 

“The weather has certainly created tightness in the (agricultural) markets,” Sucden analyst Geordie Wilkes told AFP. 

That has stoked prices of soft commodities at a time when global inflation is already soaring due to the post-pandemic demand recovery and supply-chain snarl-ups. 

Climate change is under the spotlight as global powers at the two-week COP26 summit in Glasgow attempt to reach agreement to slow the pace of global warming. 

Droughts and frost 

Brazil, the world’s biggest coffee producer and a major player in corn, was gripped in April by a severe drought, which sent prices briefly spiking on supply woes. 

Just three months later in July, the South American giant suffered harsh frosts that pushed coffee prices to multi-year peaks. 

Arabica coffee topped $2 a pound — the highest since 2014 — and still remains close to this level. 

Elsewhere, southwestern Canada and the northern plains in the United States faced a prolonged springtime drought that damaged wheat production. 

Wheat prices were ignited and still remain close to historic highs, with soft wheat trading at $300 per tonne on Euronext. 

Greater extremes 

Experts forecast the frequency of extreme weather events such as droughts, wildfires, floods and typhoons will simply accelerate. 

“The frequency of extreme weather events seen over (recent) years leads us to believe that these events will likely happen more often in the future and therefore agricultural commodity prices will remain elevated,” Rabobank analyst Carlos Mera told AFP. 

Wilkes agreed that the outlook was gloomy for soft commodity growers as weather patterns become “more volatile, more extreme.” 

Climate change, coupled with Amazon deforestation, was “changing weather patterns and increasing” the frequency of such extreme weather events, he noted. 

Volatility can also occur when investors find it difficult to anticipate prevailing weather conditions in key production areas. 

Market swings are likewise amplified by the uneven distribution of crops around the world — and the dependency on one country for certain crops, as is the case with arabica coffee in Brazil. 

Arabica, for example, is prone to volatility “because this is mainly grown on the highlands, where weather can fluctuate more strongly and crop losses can be more severe,” said Commerzbank analyst Carsten Fritsch. 

Brazil is also impacted by the El Nino phenomenon, a warming of surface ocean waters in the eastern Pacific that occurs every two to seven years and causes droughts in some areas and flooding in others. 

Domino effect 

Added to the picture, some agricultural commodities face a “domino effect” of indirect consequences due to harsh weather conditions elsewhere. 

For example, hurricanes in the U.S. Gulf of Mexico caused major damage to oil facilities in the summer, sparking a drop in crude supply and a rebound in oil prices. 

That prompted higher sugar prices because the commodity is used in the production of ethanol — a cheaper version of gasoline, or petrol. 

The cotton market meanwhile bounced because higher oil prices make it more expensive to produce synthetic fibers. 

Cotton prices currently stand at their highest levels for more than a decade. 

 
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President Joe Biden and his advisers appear to be nearing a decision on whether to reappoint Federal Reserve Board Chair Jerome Powell when his term ends in February.

But public outcry over persistently high inflation may have changed the terms of the discussion.

Biden is deciding as inflation climbs to levels not seen in three decades, with prices rising for various goods and services as well as necessities such as food and fuel. On Wednesday, the Labor Department reported that inflation in October jumped 6.2% from a year ago, a stunning leap after the Fed had spent nearly a decade unable to push inflation to 2%, its nominal target rate.

Last week, Powell and current Federal Reserve Board Governor Lael Brainard met individually with Biden in the White House, just days after Biden told reporters that he intends to make his plans for the Fed known “fairly quickly.”

With public approval of Biden’s job performance dropping, his party reeling from a gubernatorial election setback in Virginia in early November, and congressional Republicans hammering him for rising prices, Biden’s Fed appointment decision has taken on even greater weight.

Bank regulation on back burner

Since early this year, when speculation began over whether Biden would reappoint Powell, the clear alternative was for him to elevate Brainard to the job. But at the time, the focus of the debate appeared to be on their different approaches to banking regulation.

When people think of the Fed, they think mainly about its role in setting interest rates and controlling the money supply in the United States. However, the Fed also plays a major role in the regulation of some of the largest financial institutions in the country.

Powell, a Republican who was appointed to lead the Fed by former President Donald Trump, has taken what critics on the left view as an overly permissive stance when it comes to the regulation of large financial institutions.

Brainard, the only Democrat on the Fed board, is more aligned with left-leaning members of her party, such as U.S. Senator Elizabeth Warren of Massachusetts, in believing that stricter supervision is necessary to avoid a repeat of the financial crisis that crippled the U.S. economy between late 2007 and mid-2009.

Now, however, with inflation on the rise and the president and his party facing poor public approval ratings, tighter banking regulations may be a second-tier issue for Biden.

“If you want to look at the economy right now and have a ledger of things to worry about, the soundness and safety of the banking system is not at the top of that list,” Mark Hamrick, senior economic analyst for Bankrate.com, told VOA. “Over the long term, it should be toward the top of the list, but for now, banks are performing quite well. We haven’t had a major banking failure for quite some time.”

Inflation the key issue

People who pay attention to the Federal Reserve often categorize members of the board, and of the larger Federal Open Market Committee, which sets interest rates, as being either “hawkish” or “dovish.”

The hawks are policymakers who are sensitive to rising inflation and quick to raise interest rates to prevent inflation from getting out of control, even if it cools the economy to the point where not everyone seeking a job can find one.

Doves, by contrast, prioritize high rates of employment over low inflation, and they will vote to maintain low interest rates until the economy reaches what they consider “full employment.” This is not to say that doves will tolerate any level of inflation, but only that they do not mind if inflation slightly exceeds the Fed’s stated 2% target rate while jobs are still being created.

By any measure, both Powell and Brainard fall into the dovish category. As the U.S. economy has been recovering from the pandemic-induced recession last year, both have supported policies that have kept interest rates at near zero and have pumped huge amounts of money into the system, even as inflation began to rise.

Both have said that they believe the current wave of inflation is a transitory effect of the global economy trying to turn itself back on after the pandemic lockdowns. That stands in sharp contrast to many, such as former Treasury Secretary Lawrence Summers, who have been warning for months that inflation could surge out of control.

Powell, however, is largely seen as less of a dove than Brainard, and with Biden feeling the political pinch, that might tilt the balance in favor of Powell.

Relationship with Congress

Another factor in Powell’s favor is that at a time when the president’s relationship with Republicans in Congress is strained, the current chairman has a rapport with members from both sides of the aisle.

“Within Congress, Powell has built up a great amount of credibility with both sides, both Republicans and Democrats,” said Christopher Russo, a postgraduate research fellow at George Mason University’s Mercatus Center.

“In the pandemic, the Fed adopted a flexible average inflation target, meaning that they are going to run inflation above target after periods where it ran below target, and Powell has done a lot of work to explain the importance of that policy to skeptics in Congress,” Russo told VOA.

He added: “So, when we get to the current point in time, where inflation is running much higher than the inflation target, I think Powell’s credibility here would be an actual asset.”

Powell favored

Most experts have always considered Powell’s reappointment as chairman to be more likely than his replacement, especially as the job of vice chair for banking supervision is opening up, and placing Brainard there might partly placate the Warren wing of the president’s party.

Since the inflation numbers were announced on Wednesday, the odds of a Powell reappointment rose from 71% to 76% as of Friday afternoon on the political betting website PredictIt.

“I think that the politics of this become more complicated by burgeoning and more persistent inflation,” said Hamrick, of Bankrate.com. “And so what might have been seen as more of a competition six to 12 months ago has become less so.”
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Americans quit their jobs at a record pace for the second straight month in September, in many cases for more money elsewhere as companies bump up pay to fill job openings that are close to an all-time high. 

The Labor Department said Friday that 4.4 million people quit their jobs in September, or about 3% of the nation’s workforce. That’s up from 4.3 million in August and far above the pre-pandemic level of 3.6 million. There were 10.4 million job openings, down from 10.6 million in August, which was revised higher. 

The figures point to a historic level of turmoil in the job market as newly empowered workers quit jobs, often for higher pay or better working conditions. Incomes are rising, Americans are spending more, and the economy is growing; employers have ramped up hiring to keep pace. Rising inflation, however, is offsetting much of the pay gains for workers. 

Friday’s report follows last week’s jobs report, which showed that employers stepped up their hiring in October, adding 531,000 jobs, while the unemployment rate fell to 4.6%, from 4.8%. Hiring rebounded as the delta wave, which had restrained job gains in August and September, faded. 

It is typically perceived as a signal of worker confidence when people leave the jobs they hold. Most people quit for new positions. 

The number of available jobs has topped 10 million for four consecutive months. The record before the pandemic was 7.5 million. There were more job openings in September than the 7.7 million unemployed, illustrating the difficulties so many companies have had finding workers. 

In addition to the number of unemployed, there are about 5 million fewer people looking for jobs compared with pre-pandemic trends, making it much harder for employers to hire. Economists cite many reasons for that decline: Some are mothers unable to find or afford child care, while others are avoiding taking jobs out of fear of contracting COVID-19. Stimulus checks this year and in 2020, as well as extra unemployment aid that has since expired, have given some families more savings and enabled them to hold off from looking for work. 

Quitting has risen particularly sharply in industries that are mostly made up of in-person service jobs, such as restaurants, hotels, retail and in factories where people work in close proximity. That suggests that at least some people are quitting out of fear of COVID-19 and may be leaving the workforce. 

Goldman Sachs, in a research note Thursday, estimated that most of the 5 million were older Americans who decided to retire. Only about 1.7 million were aged 25 through 54, which economists consider prime working years. 

Goldman estimated that most of those people in their prime working years would return to work in the coming months, but that would still leave a much smaller workforce than before the pandemic. That could leave employers facing labor shortages for months or even years. 

Businesses in other countries are facing similar challenges, leading to pay gains and higher inflation in countries like Canada and the United Kingdom. 

Competition for U.S. workers is intense for retailers and delivery companies, particularly as they staff up for what is expected to be a healthy winter holiday shopping season. 

Online giant Amazon is hiring 125,000 permanent drivers and warehouse workers and is offering pay between $18 and $22 an hour. It’s also paying sign-on bonuses of up to $3,000. 

Seasonal hiring is also ramping up. Package delivery company UPS is seeking to add 100,000 workers to help with the crush of holiday orders and plans to make job offers to some applicants within 30 minutes.
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U.S. President Joe Biden, Chinese President Xi Jinping and leaders of the Asia-Pacific Economic Cooperation member economies concluded their virtual APEC Leaders’ Meeting on Friday, agreeing on a series of commitments regarding the coronavirus pandemic, economic recovery and climate change mitigation.

Following the meeting chaired by New Zealand Prime Minister Jacinda Ardern, leaders adopted a declaration under the theme of “Join, Work, Grow. Together,” which highlights policy actions to respond to COVID-19.

According to organizers, the declaration “lays out commitments in accelerating economic recovery and achieving sustainable and inclusive growth, including further actions in tackling climate change, empowering groups with untapped economic potential, supporting the region’s micro, small and medium enterprises and addressing the digital divide.”

The 21 APEC member economies account for nearly 3 billion people and about 60 percent of global GDP, spanning the Pacific Rim from Chile to Russia to Thailand to Australia.

Officials said they made significant progress during some 340 preliminary meetings. APEC members had agreed to reduce or eliminate many tariffs and border holdups on vaccines, masks and other medical products important to fighting the COVID-19 pandemic.

The APEC meeting came on the heels of an unexpected U.S.-China declaration made Wednesday at the COP26 climate summit in Glasgow, Scotland, where the world’s two biggest CO2 emitters said they would work together to achieve the goal set out in the 2015 Paris climate agreement of limiting warming since pre-industrial times to 1.5 degrees Celsius (2.7 F) by the end of the century.

While the declaration was thin on details, Washington and Beijing pledged to cooperate on cutting emissions and to create a joint working group that will meet regularly to address the climate crisis over the next decade. Analysts called these small positive signs ahead of the Biden-Xi virtual summit scheduled for Monday.

The Glasgow statement moves the two countries significantly back toward a cooperative relationship in the many areas where Biden and Xi have complementary or similar interests, said Charles Morrison, adjunct senior fellow at the East-West Center, a research group established by the U.S. Congress in 1960 to strengthen relations among the peoples of Asia, the Pacific and the United States.

“What I would like to see is a collaborative examination of where they have common ground and next an implementation strategy,” Morrison added.

According to the White House, during his address at the virtual meeting, Biden “underscored his commitment to strengthening our relationship with APEC economies in order to advance fair and open trade and investment, bolster American competitiveness, and ensure a free and open Indo-Pacific.” 

Xi’s pledge

Xi made a similar pledge in his address, saying China would “unswervingly” expand its opening up to the outside world and share China’s development opportunities with the world and Asia-Pacific countries, state broadcaster CCTV said.

Jennifer Bouey, Tang chair for China policy studies at the RAND Corporation, an American global policy research group, noted, however, that Beijing recently passed two new privacy and security laws that limit data sharing under the pretext of national security and the public interest.

“They also become a barrier for China’s collaboration not only with the U.S. but with the world at large,” Bouey said.

Issues remain

APEC members failed to reach a consensus on a U.S. proposal to host APEC gatherings in 2023. Russia rejected the bid because of a U.S. blacklist of its diplomats set in April, when Washington sanctioned the Kremlin for interference in the 2020 U.S. presidential election and hacking federal agency systems.

“The Russians simply did not want to accept the United States’ ability to make persona non grata for the Russian so-called diplomats who are no longer welcome in the United States, and the United States was not going to negotiate over security issue,” said Patrick Cronin, the Asia-Pacific security chair at the Hudson Institute, a Washington research group.

There are no other bidders to host the 2023 meetings, though APEC works on a consensus basis so all members must agree.

“One economy is still undergoing consultations and has not yet joined consensus,” a White House official told VOA. “We hope this impasse is resolved quickly to ensure we can continue the positive momentum on economic cooperation through APEC.”

Meanwhile, Taiwanese President Tsai Ing-wen used the APEC meetings to rally support for her bid to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a trade pact that Beijing also is seeking to be a part of. Beijing considers Taiwan to be a breakaway province and has vowed to block Taipei’s bid.

Lengthy process

CPTPP members likely will negotiate with Beijing and settle on the issue of Chinese membership first before Taiwan’s bid — a process likely to take years.

“It needs approval from, among others, Japan, Canada and Australia, none of which are inclined to roll out the red carpet for China right now,” said Robert Daly, director of the Kissinger Institute on China and the United States at the Wilson Center, a global policy group in Washington.

Daly said there’s a chance, however, that more countries gradually will come to accommodate China.

“We know that China is patient, that they are gradualist, and that they will work with the other parties, one by one,” he said. “And China goes into this still as the leading trading nation in the world, and the lodestone of Asian economics.”

The Biden administration has not indicated interest in joining CPTPP, the 11-nation trade pact formed in 2018 after former President Donald Trump in 2017 pulled out of the Trans-Pacific Partnership (TPP), a free trade agreement negotiated by President Barack Obama to deepen U.S. economic engagement in the Asia-Pacific region and counter China’s growing influence there.

Some information for this report came from The Associated Press.
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The European Commission lowered its forecast for Spanish growth this year as the country’s recovery from the COVID-19 pandemic lagged behind other European nations.

The commission said Thursday it estimates that the rise of Spanish gross domestic product will be 4.6% this year and 5.5% next year, almost two points less than earlier forecasts of 6.5% this year and 7% in 2022.

Spain was the European economy hit hardest by COVID-19, and its recovery has been slower than those of its continental neighbors.

At the end of the third quarter, Italy’s GDP was 1.4% below its level at the end of 2019.

Germany has narrowed the gap to 1.1% compared with pre-pandemic levels, and France has reduced the difference to just 0.1%.

However, in Spain — the eurozone’s fourth-largest economy — GDP is 6.6% below 2019 levels.

Unemployment remains stubbornly high at 14.9%, while youth joblessness, for those under age 24, is the worst in Europe at 30.6%.

Inflation has soared to 5.5% compared to October 2020, the highest figure since 1992 when the peseta was paired with the German deutschmark. Soaring energy costs, as well as the rising cost of summer holidays, pushed up inflation, analysts said. Core inflation stood at 1.4%.

The nation’s budget deficit is expected to hit 8.4% by the end of the year, way above the European Union target of 3%, which has been relaxed until 2022.

Spain’s coalition government is staking its hopes on the arrival of EU recovery funds to revive the economy.

Under the 2022 budget, Spain plans to spend a record $46 billion of state funds on investments that analysts say will boost growth and lower the deficit to a projected 5% in 2022 and 4% in 2023.

Nadia Calviño, Spain’s economy minister, told a meeting of European finance ministers Tuesday the nation was on course to cut its deficit.

“We have adopted a prudent attitude when preparing the budgets for 2021 and also for 2022 so that, in fact, tax revenues allow us, even in a not-so-positive macroeconomic situation, to reduce the public deficit in 2022,” she said.

Macroeconomics aside, on the streets, some are still waiting for the recovery from the pandemic.

Oscar Díaz, managing director of Mundopalet, a company that makes pallets to transport goods, is a worried man. He told VOA on Thursday he had to stop half of his production lines at his company’s factory in Toledo, 55 miles south of Madrid.

The company, which employs 100 people, is struggling to find enough wood to make its products, as countries such as Brazil, China and Lithuania have raised prices from $1,382 per truckload earlier this year to $10,362.

Major economies such as the United States, China and Germany have also raised their demand for timber as their economies start to recover from the pandemic, further pushing up the prices.

“Yes, I am concerned. Some of our clients’ companies have stopped working. We have halted work on 10 of our 20 production lines. We are in danger,” Díaz told VOA from his factory.

Mundopalet is by far not alone, as Spanish companies grapple with supply chain problems, typical of other sectors, from winemakers to farmers.

To make things worse, Spain’s truck drivers plan to strike for three days the week before Christmas, the National Road Transportation Committee in Spain said Wednesday.

In the run-up to one of the busiest periods of the year, the drivers are threatening to disrupt supply chains if the Spanish government does not meet its demands, which include safer rest areas and a ban on requiring truckers to load and unload goods.

However, analysts say the health of Spain’s labor market shows the effects of the pandemic are fading.

The number of employed workers rose in the third quarter of 2021 by 359,300 workers, according to the National Statistics Institute, bringing the total to over 20 million, the first time this figure has been reached since 2008, when the global financial crisis began.

During the same summer period, the ranks of the jobless decreased by 3.59%, according to data from the institute.

Javier Díaz, an economist at IESE business school in Madrid, said Spain has suffered more from the pandemic than other European countries because of its reliance on tourism and the automotive sector, which is struggling because of a global chip shortage and lower consumer demand.

“What is important to look at is not the unemployment level but the employment. That shows the economy is not in such a bad way,” he told VOA.

Spanish inflation has gone up because of the global rise in fuel and energy prices, and a lack of demand in key sectors such as tourism and the car industry, which are still recovering from the shock of COVID-19, he said.

“Spain is not really struggling. Growth of between 6% and 4% this year is actually better than it was before the pandemic,” Díaz said. 
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German Finance Minister and Vice Chancellor Olaf Scholz, the presumptive leader of the next government, presented an updated financial forecast Thursday indicating increased revenues for future government projects.

At a news conference in Berlin, Scholz said that despite the COVID-19 pandemic, the recent “fourth wave” of new infections and the worldwide supply chain problems, Germany’s tax revenue over the next few years would be higher than the estimates made in May.

Scholz said the new revenue forecast showed all levels of government collecting about $205 billion more in revenue through 2025 than the earlier prediction. He credited the higher-than-expected revenue to “a robust labor market.”

Scholz’s Social Democratic Party won the most seats in September’s parliamentary elections, but because it does not control more than 50% of parliament, it is in negotiations with the third- and fourth-place finishing parties, the environmentalist Greens and pro-business Free Democrats, to form a coalition government.

When asked how the power-sharing negotiations were going, Scholz said he was optimistic.

“I see very concrete things going on, and the observations I had are that a lot of things have come together. Everything still left to discuss is not so difficult that it cannot be overcome,” he said.

Scholz said this new forecast meant the next government could “work sensibly,” though he cautioned there were still financial burdens from the pandemic.

He identified investments in mitigating climate change and upgrading Germany’s public sector computer and internet infrastructure as two of his priorities.​

Some information for this report came from The Associated Press, Reuters and Agence France-Presse.
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Afghanistan is “at the brink of economic collapse” and the international community must urgently resume funding and provide humanitarian assistance, Pakistan’s foreign minister warned Thursday as U.S., Chinese, Russian and Taliban diplomats met in Islamabad.

Shah Mehmood Qureshi spoke at the opening of the so-called “troika plus” meeting, which included Thomas West, the new U.S. special envoy for Afghanistan. The delegates also met later Thursday with Taliban foreign minister Amir Khan Muttaqi.

“Today, Afghanistan stands at the brink of an economic collapse,” Qureshi said, adding that any further downward slide would “severely limit” the new Taliban government’s ability to run the country.

“It is, therefore, imperative for the international community to buttress provision of humanitarian assistance on an urgent basis,” he said.

That included enabling Afghanistan to access funds frozen by Western donors since the Taliban took control of the country in August, he added.

Resuming the flow of funding “will dovetail into our efforts to regenerate economic activities and move the Afghan economy towards stability and sustainability”, Qureshi said.

Doing so would benefit Western countries also, he argued in later comments to state media.

“If you think that you are far, Europe is safe and those areas you imagine will not be affected by terrorism, don’t forget the history,” he said. “We have learned from the history and we don’t want to repeat those mistakes made in the past.”

The United Nations has repeatedly warned that Afghanistan is on the brink of the world’s worst humanitarian crisis, with more than half the country facing “acute” food shortages and winter forcing millions to choose between migration and starvation.

The troika plus meeting represents envoy West’s first trip to the region since taking over from Zalmay Khalilzad, the long-serving diplomat who spearheaded talks that led to the U.S. withdrawal from Afghanistan earlier this year.

The State Department said earlier in the week that West also plans to visit Russia and India.

“Together with our partners, he will continue to make clear the expectations that we have of the Taliban and of any future Afghanistan government,” State Department spokesman Ned Price told a briefing this week.

West, who was in Brussels earlier this week to brief NATO on US engagement with the Taliban, told reporters the Islamists have “very clearly” voiced their desire to see aid resumed, normalise international relations and achieve sanctions relief.

He called for unity from allies on those issues, noting that Washington “can deliver none of these things on our own”. 
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China on Thursday held a subdued version of its annual “Single’s Day” shopping spree, shorn of the usual boasting on sales volume as the country’s chastened e-commerce sector reels under a government crackdown on platforms like Alibaba. 

The world’s biggest shopping festival has for years been accompanied by aggressive promotions and breathless hourly updates by Alibaba starting at midnight and detailing ever-rising sales figures that dwarf the annual GDP of many nations. 

But there were no rolling tallies or triumphant comments by executives from major platforms as of Thursday morning, and state media have described a quieter event this year in the wake of Beijing’s campaign to rein in Big Tech. 

11-day shopping event 

“Single’s Day,” so-called for its 11.11 date, began more than a decade ago and for years was a one-day, 24-hour event. 

But Alibaba and its rivals have expanded that out to an 11-day promotion culminating on November 11, while some retailers and platforms have started offering discounts, special offers and pre-sales as early as October.  

Thanks to the Chinese consumer’s predilection for smartphone-enabled bargain-hunting, Single’s Day now dwarfs the pre-Christmas “Black Friday” promotion in the United States. 

Platforms operated by Alibaba and its closest competitor JD.com reported combined sales of $115 billion during last year’s promotion. 

The festival has gradually become a closely watched gauge of consumer sentiment in the world’s second-largest economy, but it was unclear on Thursday when any sales figures might be released. 

Heads down 

E-commerce platforms are keeping their heads down because of the government scrutiny, which targets alleged abuse of user data and monopolistic business practices, but also appears motivated in part by wider concerns that Big Tech had become too powerful and unregulated.  

Some early indicators, however, had pointed to continued robust spending, with Alibaba saying hundreds of brands had gotten off to a stronger start from November 1 compared with the previous year, while providing no figures. 

The government scrutiny has rattled big players like Alibaba, Tencent, and JD, slicing billions of dollars from their equity values, but experts say the ruling Communist Party is not about to significantly hobble e-commerce. 

The party is waging a long-term campaign to diversify China’s economy away from an over-dependence on manufacturing, exports and government investment, toward a more market-based, consumer-driven model. 

E-commerce has aided greatly in this effort, and Chinese e-commerce executives have said the pandemic has boosted online purchases further, partly by discouraging in-person shopping in crowded stores. 

Less ‘gunpowder’ 

Alibaba fell out of favor late last year after billionaire co-founder Jack Ma issued an unprecedented criticism of Chinese government regulators. 

The company was fined $2.75 billion, authorities postponed a record-breaking IPO by its financial affiliate Ant Group, and other tech giants were hit with fines and business restrictions. 

The government has targeted practices by e-commerce leaders that are seen as abusing their dominant market positions, such as banning merchants from selling their products on rival platforms or using algorithms to bombard consumers with recommendations for further purchases. 

Last weekend, the government issued special “Single’s Day” guidelines reminding platforms that misleading claims on discounts or on the efficacy of products, manipulating sales figures, and selling counterfeit products, were all strictly forbidden. 

Chinese state media have reported less aggressive promotional activity this year. 

“Although the excitement remains, the smell of gunpowder among the e-commerce giants is significantly weakened,” respected financial-news website Jiemian.com said in a recent report. 
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The United States and China surprised the COP26 climate summit in Glasgow on Wednesday with a joint declaration to take action to limit global warming over the next decade.

The declaration came as delegates entered the final hours of negotiations to agree on a final text at the conference that will outline how the world will limit global warming to less than 1.5 degrees Celsius above pre-industrial levels.

China and the United States are the world’s two biggest polluters, and scientists say their future actions are critical in the fight against climate change. The absence of Chinese leader Xi Jinping from the summit last week was strongly criticized by U.S. President Joe Biden.

U.S. climate envoy John Kerry told reporters in Glasgow on Wednesday that the joint declaration builds on statements made by both countries in April.

“We also expressed a shared desire for success at this COP on mitigation, adaptation, support and, frankly, all of the key issues which will result in the world raising ambition and being able to address this crisis. Now, with this announcement, we’ve arrived at a new step, a road map for our present and future collaboration on this issue,” Kerry said at a press conference.

“The United States and China have no shortage of differences, but on climate, cooperation is the only way to get this job done. This is not a discretionary thing, frankly. This is science. It’s math and physics that dictate the road that we have to travel,” Kerry added.

China’s chief climate negotiator, Xie Zhenhua, echoed those sentiments.

“Climate change is a challenge, a common challenge, faced by humanity,” Xie told reporters. “It bears on the well-being of future generations. Now, climate change is becoming increasingly urgent and severe, making it a future challenge into an existential crisis. In the area of climate change, there is more agreement between China and the U.S. than divergence, making it an area with huge potential for our cooperation. We are two days away from the end of the Glasgow COP, so we hope that this joint declaration can make a China-U.S. contribution to the success of COP26.”

Among the joint pledges were cooperation on controlling methane emissions, tackling illegal deforestation, enhancing renewable energy generation and speeding up financial support for poorer nations. But the declaration did not include many specific dates or targets.

Cautious welcome

After the joint declaration, U.N. Secretary-General Antonio Guterres tweeted, “I welcome today’s agreement between China and the USA to work together to take more ambitious #ClimateAction in this decade. Tackling the climate crisis requires international cooperation and solidarity, and this is an important step in the right direction.”

Climate activists offered a cautious welcome to the declaration.

“This announcement comes at a critical moment at COP26 and offers new hope that with the support and backing of two of the world’s most critical voices, we may be able to limit climate change to 1.5 degrees,” Genevieve Maricle, director of U.S. climate policy action at the World Wildlife Fund, wrote in an email to VOA. “But we must also be clear-eyed about what is still required if the two countries are to deliver the emission reductions necessary in the next nine years. 1.5C-alignment will require a whole-of-economy response.”

Momentum

The joint declaration has given new momentum to the negotiations as delegates try to agree on a final text, officially known as the “cover decision,” by the end of the conference on Friday. The text details how parties to the COP26 summit will limit global warming to no more than 1.5 degrees C in Earth’s average temperatures above pre-industrial levels — the target agreed on at the Paris climate summit in 2015.

The first draft text of the decision, published Wednesday, urges countries to “revisit and strengthen” their targets on cutting emissions before the end of 2022. It says rich countries should go beyond the pledge to pay poorer nations $100 billion a year. The draft text calls on governments to phase out coal and fossil fuels, but with no fixed dates.

The COP26 host, British Prime Minister Boris Johnson, urged delegates to “grasp the opportunity.”

“We’re now finding things are tough, but that doesn’t mean it’s impossible. It doesn’t mean that we can’t keep 1.5 alive,” Johnson said. “I think with sufficient energy and commitment, and with leaders from around the world now ringing up their negotiators and asking them to move in the ways that they know they can move and should move, I still think we can achieve it. But I’m not going to pretend to you that it is by any means a done deal.”

Jennifer Morgan, executive director of Greenpeace International, told VOA that the language of the draft text was weak.

“This is not a plan to address the climate emergency. It’s a bit like a pledge and a wink and a hope,” Morgan said. “Countries need to commit to actually come back to increase and strengthen their targets and their actions. That’s clearly one thing. The text does include that coal will be phased out and fossil fuel subsidies will be phased out. I think optimally, you would have dates by which time they would be phased out, but it’s important that they’re there.”

Climate finance

Delegates are also negotiating how much — and quickly — richer nations should pay poorer countries to help them deal with the impact of climate change and de-carbonize their economies. While richer countries are responsible for the majority of greenhouse gas emissions, developing countries tend to suffer greater impacts of climate change. A pledge first made in 2009 by richer nations to pay $100 billion annually — and renewed at the Paris climate summit in 2015 — has still not been fulfilled.

“It’s very frustrating to see countries that have spent six years conspicuously patting themselves on the back for signing that promissory note in Paris, quietly edging towards default now that vulnerable nations and future generations are demanding payment here now in Glasgow,” Johnson said Wednesday.
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