Month: June 2019

Dollar’s surge against euro comes with pluses and minuses alike

The dollar ended Wednesday at its highest value — $1.

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05 — against the euro in 12 years, and many analysts expect it to become more valuable than the common European currency in coming days. Other currencies have also taken a slide, making overseas travel cheaper but goods and services priced in dollars more expensive for foreigners.

The unexpected surge has led economists to reduce their expectations for U.S. economic growth this spring; this week, it pushed markets into negative territory for the year. It’s largely happening because the U.S. economy has been unusually strong amid a global slowdown, giving the dollar an advantage over other currencies.

Still, “it’s negative” for growth, said John Silva, chief economist at Wells Fargo Securities, adding: “It’s the unexpected movement of the dollar that has really caught a lot of people offsides.”

A wide range of companies report sales declines as a result of the trend. For instance, Avon, the New York-based direct-sales cosmetics company, which counts Brazil, Mexico and Russia among its largest markets, is now planning to sell millions of dollars less of lipstick, powder and eyeliner abroad.

Massachusetts-based retailer Staples announced last week that it has sold fewer office supplies abroad this year, citing the dollar.

Meat and poultry companies are expecting to sell less as the price of imports rises in Europe and other countries. Beverages aren’t safe, either. The Wine Institute, a trade association for California winemakers, said that exports declined last year after four consecutive years of record revenues.

Linsey Gallagher, the institute’s vice president of international marketing, said much of the slowdown was attributable to a decline in exports to Europe and Canada, the biggest foreign buyers of Golden State wine.

“We’re quite exposed, with 75 percent of our exports going in that direction right now,” Gallagher said. “We’ve got our work cut out for us.”

While the jobs market has been strong in recent months, the strong dollar could eventually send employment up. Manufacturers have perhaps the most to lose from a surging dollar; they already report declining orders.

As a result, manufacturing hiring appears to be taking a hit. Factories added just 8,000 new workers in February, down from an average of 18,000 a month last year.

“You’ve seen a drop-off the last couple of months,” said Scott Paul, president of the Alliance for American Manufacturing, a Washington group that advocates for policies to spur more factory jobs. “It’s going to present a big challenge to manufacturing.”

For American consumers, the flip side of the dollar’s rise will most immediately be felt in lower prices for imported goods at home — and cheaper trips abroad.

A stronger dollar will eventually mean Americans will pay less for French wine, Italian shoes and Belgian chocolates, said Silva, the Wells Fargo economist. But he cautioned that it could be a while before retailers will pass those savings on to their customers.

International airline prices — denominated in dollars — aren’t falling, but hotel prices are. The popular travel website TripAdvisor forecast recently that hotel room prices would decline 7 percent overseas this year, with a 9 percent fall in Europe.

The biggest savings will come in places that Americans might not want to visit — Russia and Ukraine — but also in more likely destinations such as Sweden (down 19 percent), France (down 13 percent) and Morocco (down 12 percent).

Marriott International, with its fleet of 4,100 hotels around the world, is feeling both the ups and the downs of those trends.

Chief executive Arne Sorenson said in a recent conference call that the company is bullish about business at its European hotels this summer: About 20 percent of lodgers then typically come from North America.

On the other hand, international arrivals were down 3 percent in New York in the fourth quarter.

Economists warn that companies depending on foreign tourists could face trouble. David Huether, senior vice president of research at the U.S. Travel Association, said that foreigners slowed their spending in the United States last year.

“The travel habits likely changed,” Huether said. “It could be that people shortened their trip,” he added, or that they spent less on souvenirs and meals while they were here.

The dollar is rising because the United States has emerged as an outlier in the global economy. Many other countries around the world, particularly in Europe, are struggling. In response, central banks in Europe and elsewhere are lowering interest rates. That has the effect of reducing the value of currencies.

In the United States, by contrast, growth is relatively robust. Federal Reserve officials are preparing to raise interest rates later this year. That strengthens the dollar.

Few forecasters saw the surge coming. The dollar has risen nearly 20 percent against the euro in the last six months. It has hit its highest value against the Japanese yen in eight years.

When the dollar is strong, it is easier for Americans to buy foreign goods and harder for foreigners to buy things from America. That usually adds up to a decline in net exports and lower overall growth for the economy.

As a result, economists have in recent weeks have reduced their forecasts for U.S. economic growth this year by a few tenths of a percentage point.

In official statements, companies tend to welcome the symbolism of a strong dollar while bemoaning its effects on bottom lines.

“On the positive side, a strong U.S. dollar indicates strength in our economy, and obviously, that’s good, given our position in the market here,” Mark Fields, chief executive of Ford Motor Co., told investors during a recent earnings call.

“Alternatively,” he said, “a strong dollar has an effect . . . on our competitive position, especially against competitors who import here into the U.S.”

Some exporters also hope that while the strong dollar may be a negative for the U.S. economy in the short term, attempts to boost growth through monetary policy in Europe, Japan and elsewhere will ultimately lead to a stronger economy at home and abroad.

By making foreign countries more competitive, the reasoning goes, their economies will improve, their currencies will strengthen and locals will have more ability to buy U.S. goods.

“We want a strong Europe” in terms of growth and buying power, said Chad Moutray, chief economist for the National Association of Manufacturers. “We want a strong China and Japan. . . . In the sense that those actions lead to stronger economies and stronger export markets for us, that’s a positive in the long term.”

Metro leader search on hold

For an agency already under fire for fatal safety lapses and revelations of financial mismanagement, the latest developments indicate more turmoil.

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Metro has abruptly ground to a halt in addressing the authority’s future executive leadership. The agency also might use new rail cars to replace older ones rather than to expand the subway’s capacity.

Meanwhile, Washington Mayor Muriel Bowser moved to oust one of city’s representatives on the Metro board and replace him with someone who shares her view of the kind of leadership the agency needs.

In another surprise Thursday, the transportation chiefs for Washington, Maryland and Virginia agreed in principle to allow Metro to exercise purchase options for 220 new rail cars, according to Virginia Transportation Secretary Aubrey Layne.

The agreement, first reported by radio station WAMU, would add to the 528 new rail cars for which funding has already been approved.

Separately, in a sign of Metro’s continuing financial difficulties, officials said Thursday that the agency has yet to submit paperwork to the federal government to be reimbursed for $400 million that it spent in previous years to upgrade the system. Metro was years late in applying for the federal grants and is still playing catch-up in accounting for its spending in order to collect the money.

The agency’s board chairman, Mortimer Downey, also criticized Metro’s past financial managers for the troubles.

“Don’t ask me why the people at WMATA never sent those [grant] applications in,” Downey said. If he had done the same when he was chief financial officer of the New York transit agency, Downey said, “I would have been either fired or executed on the spot.”

As for the rail car purchase, Metro wants to acquire the total of 728 new, technologically advanced rail cars over the next several years to eliminate six-car trains during rush hours, replacing them with all eight-car trains.

The transit agency wants Maryland, Virginia and Washington to pay $1.47 billion for the eight-car rail plan — $614 million for the 220 additional and $856 million for infrastructure upgrades to accommodate more trains. What apparently remains to be decided is whether the new cars will be used to replace old cars or used to increase capacity, and whether the jurisdictions will spend $856 million for related infrastructure improvements.

Metro’s purchase options for the cars expires in July, Downey said.

“We’ve been asked to produce an analysis of how many cars should we buy out of the option program, what should they be used for, what ancillary investments will be immediately necessary or long-term necessary,” he said.

The $1.47 billion rail-car plan is part of a broader, $7 billion list of hoped-for capital improvements — a plan dubbed Metro 2025 — for which the agency had been seeking funding approval this spring.

However, after a discussion with Maryland, Virginia and Washington officials about Metro’s financial condition, Downey said, the agency has agreed not to seek funding for most of the Metro 2025 plan until next year. The only piece that will remain on the table is the rail-car acquisition, because the purchase options are due to expire.

Regarding the Metro board’s membership, District of Columbia Council member Jack Evans, D-Ward 2, who represents the city on the panel, said he will ask the council to pass legislation that would remove Tom Downs, a Metro board member since 2011. Downs, whose term on the Metro board doesn’t expire until 2018, is a longtime transit executive and a former Amtrak chairman.

The move appears related to a disagreement over the type of general manager Metro should hire, with Bowser and other Washington officials favoring a financial turnaround specialist. Downs was in the camp that favored a more traditional transit executive, Metro officials have said.

The disagreement boiled over last month, just as a majority of the board seemed ready to appoint a new top manager from a field of three finalists. Amid the turmoil, the three finalists withdrew from consideration, pushing the transit agency back to square one in its search for new executive leadership.

Now the search has been suspended until Bowser’s chosen appointee joins the board, and until Maryland, under new Republican Gov. Larry Hogan, fills one of its two voting seats on the transit authority. One of Maryland’s voting representatives resigned last year.

Metro officials have said that Hogan shares Bowser’s view that Metro, given its money woes, should hire a financial turnaround specialist as general manager.

As for the board shake-up, Bowser would replace Downs with Corbett Price, a health-care financial consultant. The legislation also would remove one of the District’s alternate board members, Matthew Brown, and appoint Leif A. Dormsjo to his seat. Dormsjo is acting head of the District of Columbia’s Department of Transportation.

Evans and Bowser generally see eye-to-eye on Metro matters. By replacing Downs with a second voting member who also shares her views, the mayor would greatly enhance her ability to steer the transit agency in the direction she wants.

Asked about his impending ouster, Downs said: “The mayor’s office told me of her intention last week. I told the mayor when I met with her the first time after the election that I understand and support any mayor’s need to have their own people in that position.”

Downs said: “There are differing opinions still, even within the District government, on a lot of the Metro stuff. Different views on both the finance and the safety stuff, and the board member stuff. . . . My view doesn’t count anymore, since this is my last board meeting.”

News that Bowser wants to remove Downs came on the same day that Metro budget officials told the board that they plan to borrow $220 million to make repayments on lines of credit that are due in July. The agency has been scrambling to pay its bills for capital projects after the Federal Transit Administration restricted Metro’s ability to draw grant funds. That action came after last summer’s highly critical FTA audit report.

Metro faces cash-flow pressure because the FTA has slowed payments to it because of past financial mismanagement.

“It’s a liquidity problem, from not doing business in the appropriate way,” Downey said.

The troubles should ease when Metro accounts for the $400 million in past spending and is reimbursed for it, but Metro said it didn’t expect to complete that process until sometime next year.

“We’ve got about five years of paperwork we’ve got to get done,” Downey said.

Partly because Metro was so late applying for the federal grants, it had to wait until this year for most of them to be awarded. The award makes it possible for Metro to be reimbursed, after it accounts for the spending.

In the past, Metro borrowed money and spent it in anticipation of eventually collecting on the grants.

“If I had gone to my board and said, ‘I haven’t applied for the federal grants for the last couple of years, but trust me, I’ll borrow the money and we’ll fix it,’ I would not have stayed in that job very long,” Downey said.

Downey demurred when asked if he thought Metro managers deserved to be fired.

“Obviously we’ve got to do a better job,” he said.

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Washington Post staff writer Lori Aratani contributed to this report.

The ‘self-fulfilling prophesy" of stereotyping Asian American students

“Ophelia” was never a very good student.

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The second generation Vietnamese American described herself as “not very intelligent,” someone who got straight Cs. She failed the exam to qualify for Advanced Placement classes at the end of Junior High.

But for reasons beyond her understanding, she was placed on the AP track when she got to high school. There, surrounded by ambitious peers and high expectations, “something clicked,” she told researcher Jennifer Lee.

“I wanted to work hard and prove I was a good student,” she said. “I think the competition kind of increases your want to do better.”

Ophelia graduated with a 4.2 grade point average and an acceptance to a prestigious pharmacy program.

Lee, a sociologist at the University of California-Irvine, is the author of the new book “The Asian American Achievement Paradox,” which examines how stereotypes based on race can determine students’ chances for success. For her research, she surveyed hundreds of students like Ophelia — children of Vietnamese and Chinese immigrants who felt they were treated differently because of their race.

“Teachers and guidance counselors and peers assumed that they were smart and disciplined and high achieving,” Lee told the Washington Post. “So they were more likely to be placed on advanced tracks, more likely to be directed toward selective colleges. Some admitted to getting grades they didn’t feel like they deserved.”

Paradoxically, though, this was one stereotype that served its targets well. Lee said that students who were subject to irrationally high expectations usually rose to meet them. Surrounded by brainy classmates only happy with “A’s,” they adjusted their own notions of what it means to do well. Assumed to be a “smart Asian,” as Lee put it, they put extra effort into their coursework in order to live up to expectations of their ethnicity.

“What you have is a self fulfilling prophesy where initially what is untrue becomes true,” Lee said. She calls it the “stereotype promise.”

Lee’s findings are the inverse of social science we’ve heard about before. For the past two decades, researchers have been investigating the “stereotype threat” — how negative assumptions about certain groups can undercut their performance. It’s been used to explain why high-achieving African American students sometimes struggle when they get to college, why talented women may under-perform in STEM fields.

Social psychologist Claude Steele, who coined the term in 1995, explained how the stereotype threat affects members of groups that are seen as less able or intelligent.

“They know that they are especially likely to be seen as having limited ability,” she wrote in the Atlantic in 1999. “Groups not stereotyped in this way don’t experience this extra intimidation. And it is a serious intimidation, implying as it does that they may not belong in walks of life where the tested abilities are important — walks of life in which they are heavily invested. Like many pressures, it may not be experienced in a fully conscious way, but it may impair their best thinking.”

In the Los Angeles area, where Lee and her colleagues surveyed 4,800 first generation Americans, the children of Mexican immigrants were most likely to be affected by the stereotype threat. These respondents told Lee that they were rarely taken seriously as students. They weren’t offered help preparing for the SAT and weren’t advised to apply for four year colleges. If a Mexican American student wanted to get into a selective school, they had to be their own tutors, their own guidance counselors.

“One of the questions it raises is how many students aren’t given the opportunity to meet their potential,” Lee said.

Lee’s finding challenges the assumption that gaps in achievement are purely cultural, that “tiger moms” and community regard for education entirely explain Asian American students’ success. The perception of a culture can be as influential as the culture itself.

That’s not to say that culture isn’t a factor — Lee has previously studied how raised expectations within the Asian American community drive high achievement. But when we adopt stereotypes about Asians and education, we’re crediting the wrong culture, she said. It’s not necessarily Chinese people who value education so highly (only 4 percent of China’s population has a college degree), it’s the highly-educated Chinese immigrants who come to the U.S., more than half of whom went to college.

“It’s not culture reduced to a certain ethnicity,” Lee said. “It’s about who immigrates to the U.S. and what sort of norms they’re bringing.”

Chinese and Korean immigrants are “hyper-selected,” as Lee put it. They are more likely to be highly skilled and more likely to hold an advanced degree than almost any other immigrant group. In fact, they are almost twice as likely to be college-educated than the general U.S. population — only 28 percent of Americans have graduated from college. Since parents’ level of educational attainment is one of the best predictors of their children’s achievement, it’s hardly surprising that academically successful Chinese immigrants will have academically successful kids.

Teachers’ assumptions about Asian culture — misplaced though they may be — affect how they perceive Asian American students. And Asian American students internalize those perceptions. They wind up achieving more than they normally would have based on a stereotype that isn’t even completely true.

“We think that grades and test scores and who gets into what colleges is objective, that it’s all about individual effort,” Lee said. “But our work reveals the hidden ways in which biases and stereotypes operate that make certain outcomes more possible for certain groups.”

Most of the students Lee spoke to said that the stereotype promise was a good thing. It helped them do well in school and get into good colleges.

But Lee warns that it can be a “double edged sword.” Asian American students are also likely to feel a form of the intimidation Steele described in writing about the stereotype threat.

While black students may worry that their failures will reinforce negative assumptions about African American achievement, Asian American students who didn’t meet the high expectations set for them “didn’t feel Asian,” Lee said. One man told her that he was “the whitest Chinese guy she’ll ever meet,” because he didn’t fit the stereotype of a high-achieving Asian. The pressure can lead to mental health issues, like anxiety and depression.

And the positive stereotypes that serve Asian Americans well in school can act against them once they’re in the workforce. They have a harder time attaining leadership positions because they’re seen as diligent and thoughtful, rather than bold and creative, according to Lee. She noted that Asian Americans made up 6 percent of college students (slightly more than their proportion of the U.S. population) but 2 percent of college presidents. In Silicon Valley, Asian Americans are 27 percent of the workforce but just 14 percent of executives.

The stereotype promise may help Asian American students get a degree, Lee said, but the “bamboo ceiling” stops them from achieving as much as they could with it.

Agreements for food aid to reach besieged Syrians

The Syrian government has granted the United Nations access to three Syrian towns, including one where residents say thousands of people are starving to death.

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Humanitarian assistance will be delivered to Madaya and two other cities, Fu’a and Kefraya, but no firm date had been set.

Madaya has been under siege from Syrian government forces and Hezbollah militias for seven months, preventing basic supplies from getting through.

Rachael Hocking reports.

Amateur footage shows the haunting image of an emaciated child with his ribcage sticking out.

It is perhaps the most shocking of images being shared by Syrians as part of a social-media campaign to bring attention to their suffering.

The video reportedly comes from the Syrian town of Madaya, near the border with Lebanon.

In it, the young boy says his name is Mohammed Issa.

He tells the person filming he has not eaten in a week.

(Man:) “What’s your name?”

(Child:) “Mohammed Issa.”

(Man:) “How long have you been without food?”

(Child:) “Seven days.”

(Man:) “Say that you swear to God.”

(Child:) “I swear to God.”

(Man:) “Are you very hungry?”

(Child:) “Mmmhmmm …”

(Man:) “God willing, what are you craving right now? What would you like to eat?”

(Child:) “Something sweet.”

The last time Madaya received humanitarian assistance was last October.

Since then, the United Nations says, it has been inaccessible.

The town of 40,000 people has been under siege for seven months from Syrian government forces and Hezbollah militias.

Pro-government forces have also restricted access to the nearby town of Zabadani.

Meanwhile, anti-government fighters have surrounded Fu’a and Kefraya, in north-western Syria.

Residents say people are starving to death without access to food.

One protester from the northern town of Saraqeb accuses the Syrian government of violating the terms of truces reached for Zabadani and Madaya.

(Translated) “I am standing here to oppose the truce that took place in Kefraya and al-Fu’a, and against the siege in Madaya, against the truce that led to the starvation in Madaya. The hunger of our people in Madaya was caused by the truce. The truce made them hungry.”

Now, the Syrian government says it will allow aid into Madaya, Fu’a and Kefraya.

The United Nations says in a statement it welcomes the Syrian government’s announcement but is calling for unimpeded access to reach those in need.

“Almost 42,000 people remaining in Madaya are at risk of further hunger and starvation. The UN has received credible reports of people dying from starvation and being killed while trying to leave. The UN calls for immediate humanitarian access to all hard-to-reach and besieged areas and for the facilitation of the safe evacuation of civilians.”

The Syrian Observatory for Human Rights, which tracks the war, puts the number of people dying from starvation in Madaya at 10.

But the international humanitarian organisation Médecins Sans Frontières says 23 patients have died of starvation at a health centre in Madaya since December the 1st.

The group is calling for medical access to blockaded towns along with the promised food aid.

Meanwhile, the conflict in those cities and others has cast a bleak outlook over peace talks the United Nations hopes to convene this month.

Syrian opposition leaders have told a UN envoy they will not participate in talks with the government until the Madaya siege and others are lifted.

 

 

 

Restoring free speech on campus

The past academic year offers a depressing number of examples of institutions of higher education failing to live up to their core mission.

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At Northwestern University, for example, Professor Laura Kipnis endured a months-long Title IX investigation for publishing an essay in the Chronicle of Higher Education in which she discussed a high-profile sexual assault case. Just a few months later, her fellow professor, Alice Dreger, courageously resigned in protest over Northwestern’s censorship of a faculty-edited medical journal.

In a similar vein, Louisiana State University fired Professor Teresa Buchanan after nearly two decades of service for her occasional use of profanity, which the university suddenly deemed “sexual harassment,” and Chicago State University enacted a new cyberbullying policy to silence a blog that was critical of university leadership.

At Iowa State University, administrators censored T-shirts created by the university’s student chapter of the National Organization for the Reform of Marijuana Laws. The Regents of the University of California are considering adopting a “Statement of Principles Against Intolerance” that would ban “derogatory language reflecting stereotypes or prejudice.” Other institutions are considering banning so-called “microaggressions” or requiring “trigger warnings” to protect students from having to confront potentially upsetting ideas and subjects. Still others have withdrawn invitations to speakers who have taken positions that some members of the community find unpleasant, offensive or wrong- headed – a practice President Barack Obama criticized this month, saying that leaving students “coddled and protected from different points of view” is “not the way we learn.”

Restrictions on free expression on college campuses are incompatible with the fundamental values of higher education. At public institutions, they violate the First Amendment; at most private institutions, they break faith with stated commitments to academic freedom. And these restrictions are widespread: The Foundation for Individual Rights in Education’s most recent survey of college and university policies found that more than 55 percent of institutions maintain illiberal speech codes that prohibit what should be protected speech. For students and faculty, the message is clear: Speaking your mind means putting your education or your career at risk.

Enough is enough. Our colleges and universities should redeem the promise of the new academic year by reaffirming their commitments to freedom of expression.

Last year, the University of Chicago convened a Committee on Freedom of Expression to do exactly that. The committee issued a statement identifying the principles that must guide institutions committed to attaining knowledge through free and open discourse. Guaranteeing members of the academic community “the broadest possible latitude to speak, write, listen, challenge, and learn,” the statement guarantees students and faculty the right “to discuss any problem that presents itself.”

How should students and scholars respond when challenged by speech with which they disagree, or that they even loathe? The Chicago statement sets forth the answer: “by openly and vigorously contesting the ideas that they oppose.” Anticipating the push and pull of passionate debate, the statement sets forth important ground rules: “Debate or deliberation may not be suppressed because the ideas put forth are thought by some or even by most members of the University community to be offensive, unwise, immoral, or wrong-headed.”

Perhaps most important, the Chicago statement makes clear that “it is not the proper role of the University to attempt to shield individuals from ideas and opinions they find unwelcome, disagreeable, or even deeply offensive.” Laura Kipnis, Alice Dreger and Teresa Buchanan would have benefited from this frank and necessary recognition.

Encouragingly, Princeton University, American University and Purdue University have already adopted the core of the Chicago statement as their own. If colleges and universities nationwide were to follow their example – either by adopting the Chicago statement or forging one of their own – academic censorship would face a powerful new challenge.

Backed by a strong commitment to freedom of expression and academic freedom, faculty could challenge one another, their students and the public to consider new possibilities, without fear of reprisal. Students would no longer face punishment for exercising their right to speak out freely about the issues most important to them. Instead of learning that voicing one’s opinions invites silencing, students would be taught that spirited debate is a vital necessity for the advancement of knowledge. And they would be taught that the proper response to ideas they oppose is not censorship, but argument on the merits. That, after all, is what a university is for.

Free speech and academic freedom will not protect themselves. With public reaffirmation of the necessity of free speech on campus, the current wave of censorship that threatens the continuing excellence of U.S. higher education can be repudiated, as it should be, as a transitory moment of weakness that disrespects what our institutions of higher learning must represent.

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Stone is a professor at the University of Chicago and served as chair of the school’s Committee on Freedom of Expression. Creeley is vice president for legal and public advocacy for the Foundation for Individual Rights in Education.