One of China’s largest auto-parts makers, Wanxiang Group (WSJ), announced plans to acquire 80 percent of ailing battery maker A123 Systems for $450 million. The Massachusetts-based firm grew out of materials technology developed at MIT and creates advanced battery technology for transportation, commercial, and electrical grid applications.
A123 Systems has received support from the U.S. Energy Department, including Small Business Innovation Research grants, and a $249 million grant from the American Recovery and Reinvestment Act program. Some lawmakers are raising national security concerns over the proposed sale (Bloomberg Businessweek).
The Politics of Globalization and Outsourcing
Increasing foreign trade and the outsourcing of U.S. jobs makes Americans anxious, but many politicians are adapting only their rhetoric, but not their policies, says Eduardo Porter of the New York Times. Porter argues that globalization is irreversible because corporations have largely globalized supply chains. To help U.S. workers compete, he recommends policies such as greater support for higher education and increased unemployment insurance, and engaging foreign countries in discussion on global labor standards and taxation treaties.
This CFR Independent Task Force report encourages the Obama administration and Congress to adopt a “pro-America” trade policy that brings the benefits of global engagement to more Americans.
International trade and investment. Read more from leading analysts on the debate over next steps in U.S. trade policy.
Corporate Regulation and Taxation
House Panel Seeks Volcker Rule Alternatives
Rep. Spencer Bachus (R-AL), chairman of the House Financial Services Committee has solicited feedback on potential alternatives to the “Volcker Rule” (Politico). Bachus believes the Volcker Rule would be onerous to both the financial sector and the broader economy: “It will undermine our nation’s ability to compete and make it harder for Main Street businesses to raise capital so they can grow and create jobs. Therefore, we must consider legislative alternatives that will not stifle economic growth and job creation.”
The Volcker Rule and the rest of the 2010 Dodd-Frank Act continue to arouse debate over the methods, goals, and implementation of the largest financial regulatory overhaul since the Great Depression. This Backgrounder by Steven J. Markovich examines the financial oversight bill.
Corporate regulation and taxation. Read more from top economists and business experts on solutions for addressing corporate tax reform.
Education and Human Capital
Leveraging Technology in the Classroom
Technology is increasingly used to support—and in some cases supplant—the work of teachers (Education Week). Some schools are turning to technology to cut costs, such as Colorado’s Eagle County school district which replaced French and German teachers with services from an online instruction provider. Others, such as New York’s School of One, use technology to bring instruction from top teachers to many students, personalize lessons, and identify weaknesses that in-person tutors can address.
Education and human capital. Read more from experts discussing ways to improve U.S. education and immigration policies.
Microsoft and NYPD Partner to Fight Crime
Microsoft and the New York Police Department (NYPD) unveiled the “Domain Awareness System” (DAS), which integrates information from the NYPD’s thousands of cameras and license plate readers with databases and criminal records (Bloomberg). The city will receive 30 percent gross revenue of any future sales of DAS. Mayor Bloomberg said the city may be able to recoup all its costs over time, “and may even make a few bucks.” NYPD Commissioner Ray Kelly added, “The system is a transformative tool because it was created by police officers for police officers.”
Innovation. Read more on how the U.S. capacity to innovate could play a chief role in economic growth.
The Morning Brief is compiled by Renewing America contributor Steven J. Markovich.