Biden’s economic agenda in jeopardy

The social spending package, being one of the two most important pillars of US President Biden’s economic agenda, is stuck in the ongoing disagreements between the left and centrists of the Democratic Party who now control both houses of Congress with a narrow majority.

Senators Joe Manchin and Bernie Sanders debated behind closed doors on Wednesday. “I’m comfortable with zero,” Manchin told his colleague Sanders, who insisted on $3.5 trillion as the size of President Biden’s social spending plans, Axios writes.

“This will contribute to inflation. We’ve already passed the American Rescue Plan. We should just pass the infrastructure bill and, you know, pause for six months,” Manchin continued accordint to Senator Tester who was present at the meeting.

EU-US trade relations

US Trade Representative Katherine Tai on Thursday insisted she is optimistic about resolving the dispute with the European Union over steel and aluminum tariffs, and that the solution also requires a concerted effort to tackle overcapacity.

Former US President Donald Trump imposed 25% tariffs on steel and 10% on aluminum from the European Union, along with other economies such as China, India, Russia and Switzerland.

The European Commission, which oversees EU trade policy, has agreed to suspend a planned increase in retaliatory tariffs until 1 December and open formal negotiations with the United States to address excess global capacity, largely centered in China.

Speaking to reporters after meeting with European Commission vice-president Valdis Dombrovskis, Tai told reporters “the talks are intense. Assume I’m optimistic.”

US stocks

The S&P 500 set a new record on Thursday. The broad index rose 0.3% to a record close at 4,549. It also broke its new all-time record at 4,551 during intraday trading.

The Nasdaq Composite Index rose 0.6% to 15,215. The Dow Jones Industrial Average 6.26 points 35,603, with IBM losing 9.5%.

Tesla helped boost the S&P 500, up 3.2% after strong gains. The S&P 500 has outperformed this month, surpassing reports of rising profits over high inflation and concerns about a possible end to Fed bond-buying. The S&P 500 rose 1.75% weekly and 5.62% monthly as of Thursday.

Sino-EU relations

MEPs passed a resolution with a large majority in favor of the proposal that European Union should deepen ties with Taiwan and begin work on an investment deal with the island.

The non-binding decision angered Beijing.

In a vote of 580 to 26, the European Parliament requested the bloc’s executive body, the European Commission, to “immediately begin an impact assessment, public consultation and work on a bilateral investment agreement”.

Lawmakers also demanded that the bloc’s trade office in Taipei be renamed to the European Union office in Taiwan. Wang Wenbin, spokesperson for the Chinese Ministry of Foreign Affairs, gave out a strong condemnation.

“The EU parliament must immediately stop the words and actions that undermine China’s sovereignty and territorial integrity,” he told reporters in Beijing.

China also expressed anger Thursday at Taiwan’s Foreign Minister Joseph Wu’s trip to the Czech Republic and a virtual address to a forum in Rome and announcement that he will visit Slovakia next week.

Taiwan issue

Rick Waters, assistant secretary of state for China, Taiwan and Mongolia, said that China, with its growing influence in the United Nations, was excluding Taiwan to the detriment of the international community.

Next Monday marks the 50th anniversary of UN resolution 2758, which states that the communist People’s Republic of China (PRC) is China’s “only legitimate” representative to the UN. The decision resulted in many countries cutting off relations with the Republic of China (Taiwan) and establishing them with Beijing.

“The People’s Republic of China abused resolution 2758,” Waters said at the German Marshall Fund event. “Taiwan being blocked for participation in nearly all of the UN activities creates an immense cost, not just for Taiwan, but I think to UN members as well.”