Capital for minority and women-led businesses to grow
Bank of America is building a network of support for minority small business owners through CDFIs, MDIs, and minority focused funds.
Bank of America is building a network of support for minority small business owners through CDFIs, MDIs, and minority focused funds.
Germany's historic moment of choice is finally here, and voters will stream to the polls on Sunday for the country's first post-World War II vote without a national leader seeking re-election. They will elect new members of the Bundestag, Germany's lower house of parliament. The leader of the party that wins the most seats will then try to secure a majority of seats by drawing other parties into a governing partnership. He or she will then replace Angela Merkel as Germany's chancellor.
If the latest opinion polls are right, the center-left Social Democrats will finish first. In coming weeks, they look likely to form a (potentially unwieldy) governing coalition with the Green Party and the pro-business Free Democrats, which would be Germany's first-ever governing alliance of more than two parties.
Though he's a man of the center-left, Olaf Scholz, current finance minister and most likely next chancellor, wouldn't represent a radical break from Merkel. He's among the more fiscally frugal of Germany's Social Democrats, and after decades in German politics, he's an experienced technocrat and a skilled manager of political alliances.
Nor would a change in government radically shift Germany's foreign and trade policies. Its new government, whoever it includes, will keep strong security ties with the United States and NATO and protect opportunities to expand economic relations with China. Germany's dependence on Russian energy will demand a continuation of Merkel's pragmatic approach to Vladimir Putin's government.
Scholz's conviction that a strong and cohesive EU is good for Germany will limit any temptation to get tougher with the governments of Poland and Hungary over their violations of EU rules and principles. And aware that COVID can widen gaps between richer and poorer EU countries, and that anti-EU economic populism remains a potent force in Italy and elsewhere, he's likely to support a generous approach to pandemic recovery in southern Europe.
But climate policy, an area where Merkel concedes she should have done more, will be an important and interesting story to watch. Given its leadership within the EU and its standing as the world's fourth largest economy, the influence of Germany's next government on climate policy will be crucial to global climate strategies. A new German government with Scholz as chancellor will likely push the pace of transition from carbon to renewable energy, at least in part because the Green Party coalition partner will push for this as hard as it can. The Greens must show progress on the climate front to maintain political credibility and popularity. If the Free Democrats are indeed part of the coalition, they'll push hard to limit tax increases to pay for tougher climate action, but they won't blow up the coalition that gives them a seat at Germany's governing table.
Even in a country that values stability and continuity, Angela Merkel's 16-year run is remarkable. More than once she's proved the maxim that it's not the smartest or strongest who survives, but the one most adaptable to change. Merkel is smart and strong, to be sure, but she'll be remembered longest – by both devoted admirers and bitter critics – as the leader who insisted Germany could and should do more to help indebted countries survive Europe's sovereign debt crisis (2010-12) and to manage the surge of migrants that followed unrest in the Middle East (2015-16). Her improvisational talents also led her to change tack on nuclear power (after the 2011 Fukushima disaster in Japan) and on common European debt.
But the main reason Merkel leaves power with an 80 percent approval rating is that, whether she receives more credit than she deserves, she has presided over a period of economic expansion and prosperity in Germany that few other world leaders can match. It's all the more remarkable then that her party looks set to find itself in opposition once a new government is formed. It's Merkel that German voters like, not her political family.
Bottom-line: Whatever he accomplishes as Germany's next chancellor, Olaf Scholz will find Angela Merkel a tough act to follow.
Jon Lieber, head of Eurasia Group's coverage of political and policy developments in Washington, shares insights on US politics:
Is a US government shutdown coming?
Hard to say. Republicans and Democrats generally are in agreement about the need to fund the government. And they generally agree at what level the government should be funded. And they generally agree about the need for supplemental money for Afghanistan and some natural disasters, coming out of hurricanes this season and wildfires. What they're not in agreement about is the federal debt limit, which is the cap on US borrowing that the US hit in early August and needs to be extended by some time in October. Otherwise, the US will have a first-ever default. This would be a very bad outcome with cataclysmic results for the entire world economy.
But Republicans are saying, "Hey, you guys want to spend a bunch of money on $3.5 trillion. We are not going to help you. So you need to find the votes for this on your own." And the Democrats are saying, "This debt belongs to all of us and therefore we all need to vote to increase the debt ceiling." The government shutdown and the debt limits so far are linked. And as long as they remain linked, there will be a government shutdown. The issue has to be resolved by the end of the month. Otherwise, government functions shut down until they get a resolution.
Why is President Biden's economic plan hanging in the balance?
Well, the plan is hanging in the balance because the Democratic Party itself is divided over how much money should be spent by the federal government over the next 10 years. The progressives support spending up to $6 trillion. The conservative members of the party are being a little bit cagier about what they'd be for. Basically, the party's in agreement that they should do some form of expanded social spending, direct subsidies for childcare, for education, for healthcare, and a whole bunch of new physical infrastructure spending. But how much and how to pay for it are really dividing the party. And there's no clear solution right now. Probably they get there by the end of the year. Biden himself has not been super effective in mitigating the differences between the two wings of the party. And you've got a small number of moderate members, including most prominently Kyrsten Sinema from Arizona, and Joe Manchin from West Virginia, who are holding out on the spending parts of the agenda. But there's also a bunch of members in the House who are for tax increases. So this will take some time to work out. Ultimately, they probably rally around $2 or $2.5 trillion in spending, but maybe not until Thanksgiving or Christmas.
Germany's Chancellor Angela Merkel has seen a lot during her 16 years in power. She's navigated a global economic recession, multiple wars in the Middle East which sparked an EU refugee crisis, and now a once-in-a-generation pandemic. Often the only woman in the room, Merkel has had to learn to tactfully deal with dozens of idiosyncratic world leaders. Many have come and gone since 2005, but Merkel has won elections again and again. We take a look at who she's dealt with from the top democracies (by economic size) throughout her tenure.
In May 2020, economic historian Adam Tooze told GZERO World he feared 1 in 5 American workers could still be out of job now due to COVID. It didn't happen. Why? Tooze says he failed to anticipate how quickly we'd get highly effective vaccines, and the scale of the economic stimulus the government was willing to put up. During the 2008 financial crisis, he explains, "we were still beginning to flex our muscles with regards to economic policy, and the scale of fiscal and monetary stimulus that we've seen is as unprecedented as the shock of the spring of last year."
Watch Tooze's interview with Ian Bremmer on the latest episode of GZERO World, airing on US public television starting Friday 9/23/21. Check local listings.
Will Evergrande be China's Lehman Bros? Chinese authorities are bracing for the increasingly likely default of Evergrande, the country's most indebted property developer. If Evergrande — a gargantuan corporation with properties in 200 cities across China — stiffs its creditors, that'll send shockwaves throughout the country's financial system, and the wider Chinese economy and society. The possible ripple effects on home buyers and countless companies and individuals that do business with or are owed money by Evergrande have invited comparisons with Lehman Brothers, the US investment bank whose 2008 collapse triggered an American financial crisis that quickly spread to the entire world. Although in principle authoritarian China has ways of containing the fallout, the potential for social unrest is real — and opacity could make it worse. More broadly, the demise of such a big player in the country's once-booming real estate market, which accounts for over 7 percent of GDP, would expose the shaky foundations of China's debt-driven economic growth model, eroding confidence in China both at home and abroad.
Et vous, Maliens? First Australia, is Mali next? France can't be happy about what's going on in Mali these days, as protesters have taken to the streets to demand that their government distance itself from Paris and boost ties with Russia instead. The upheaval comes in the wake of reports that Mali's transitional government was about to broker a security deal with the notorious Wagner Group, a Russian private military contractors cozy with the Kremlin. France, a former colonial power which keeps counterterrorism forces in Mali, has sharply criticized any tie-up with the Russian mercs, who have been accused of war crimes elsewhere. But Malians have mixed feelings about the presence of the French troops, who have made scant headway against Islamist insurgents in recent years. As the Franco-Russian competition for influence in Mali spills into the streets, it's a reminder that Moscow has been working hard in recent years to boost its standing in sub-Saharan Africa. Will it pay off in Mali?Tunisian president to rule by decree: In his latest bid to fix Tunisia's dysfunctional political system, President Kais Saied now says he can pass laws himself and ignore parts of the constitution altogether. This is the same Saied who suspended parliament and sacked the entire government in the wake of mass street protests about the ailing economy and COVID two months ago. At the time, many Tunisians supported his actions as a way to fix the country's broken politics, even if his opponents called it a coup. But now as his emergency period drags on, Saied — a former constitutional law prof — is starting to give off more dictatorial vibes. He says he needs more time to tweak the constitution to make it work for ordinary Tunisians, but a lot of folks are wondering about the president's true intentions now. Tunisia was the only democracy to emerge from the Arab Spring. Is that over?
The most powerful woman in the world is stepping down from the Chancellorship -- and stepping up to the mic.
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Betrayal. Treason. Duplicity. These are some of the words used by the French government to describe the US' recent decision to freeze Paris out of a new security pact with the UK and Australia in the Indo-Pacific, which nixed a contract for Australia to buy French submarines.
Macron's subsequent tough stance against one of its oldest and closest allies is unusual, including his decision to briefly recall the French ambassador from Washington, the first time a French president has done so. But this headstrong strategy is also a deliberate diplomatic choice.
Politics is personal. At least on some level, Macron is lashing out because America has embarrassed France and left Macron's own ego badly bruised. Biden could have kept the France-Australian sub deal alive while moving forward with the AUKUS security agreement under the cloak of secrecy. But instead, the US chose to tear it all up, sending a clear message to Paris: you're not that important.
For Macron, who became France's youngest-ever president at age 39, thanks in part to a large dose of self-belief, this diss cuts deep.
Strategic autonomy. Since coming to power in 2017, Macron has been a strong advocate of Europe pursuing a defense strategy independent from the US. (You may recall the kerfuffle that ensued after Macron called NATO "braindead.")
Macron has long said that France — and Europe — should deploy its military might to defend its own interests abroad, regardless of what America's priorities are. And asserting France's independence as a key player in the Indo-Pacific by selling arms to Australia — which in turn would help safeguard Paris' own strategic interests in the region — is exactly what Macron was trying to do when the US recently pulled the rug out from under him.
What's more, with Germany's Angela Merkel preparing to exit the stage in mere days, and the post-Brexit UK out of the EU, Macron has been vying to fill the bloc's leadership gap, but this snub scuttles his plan.
Looking inwards. France is just six months away from a general election that's shaping out to be a close race between the incumbent and his far-right rival Marine Le Pen. Le Pen, for her part, has already capitalized on France's recent diplomatic snafu with Washington to cast Macron as pandering to the Americans and unable to stand up for French interests on the global stage.
Macron, who has increasingly veered to the right on certain issues as centrism in France has lost its appeal, knows that he can't afford to look toothless, and that taking a hard line on the US could reap political benefits come election day (only 44 percent of French adults now view the US favorably).
Because close French presidential elections go to a runoff, Le Pen is still a long shot to go all the way to the top. But a string of political crises in the months ahead would increase the likelihood that another candidate, perhaps a political outsider, takes center stage — just as Macron, a former political newbie, won in an upset for the establishment in 2017.
Is Macron out in the cold? Macron took a punt in forcefully going after the US. And it's reasonable to assume that he thought EU partners would back him up more emphatically. But so far, the response has been mostly muted. (The EU's Ursula von der Leyen said tepidly in an interview that "one of our member states has been treated in a way that is not acceptable," while outside the EU, British PM Boris Johnson told Macron to "prenez un grip.")
Clearly, Paris felt ditched: after the sub snub, France's foreign minister said that EU nations need to stick together because it's the only way for Europe to "remain part of history." But as has been the case on a range of geopolitical issues, including the bloc's relations with Russia and China, the EU's 27 member states have divergent priorities.
Macron's gamble. Macron is saying all the right stuff to prove that he's nobody's lackey. And reportedly gave President Biden a piece of his mind on a call Wednesday. But if Macron fails to follow through on his threats and enforce any real consequences, he risks being perceived as a softy — exactly what he's been trying to avoid.