The New Face of the Fed
President Bush nominated Ben S. Bernanke, a leading scholar of monetary policy and chairman of his Council of Economic Advisers, to succeed Alan Greenspan as Federal Reserve chairman. Bernanke supports inflation targeting and clearer communication between the central bank and financial markets. As a governor at the Greenspan Fed, he worried aloud about deflation, dismissed concerns about a housing bubble and said a global savings glut was the reason why interest rates have remained so low.
Wal-Mart announced plans to offer lower-cost health insurance to employees and develop new store formats to reduce energy consumption. Chief executive H. Lee Scott also surprised more than a few people by urging an increase in the minimum wage, which would give many of his customers more money to spend. But the corporate responsibility push was undercut by the release of an internal memo that said health care costs could be cut by changing job descriptions to discourage unhealthy or elderly applicants.
A Bad Run for Labor
The news keeps getting worse for organized labor. Delphi, the bankrupt auto-parts maker, demanded deep cuts in base wages, from an average of $25 an hour to as low as $9. It also wants to outsource non-core jobs such as carpenters and janitors, and it wants the right to sell plants without requiring new owners to honor the union contract. Meanwhile, Northwest Airlines, which recently broke a mechanics strike by hiring nonunion replacements, demanded the right to outsource flight-attendant jobs on most international routes.
Paltry E.U. Concessions
Under pressure from France, the European Union offered only modest reductions in its tariffs and subsidies, prompting trade officials from India, Australia, Brazil and the United States to voice concerns about upcoming global trade talks. The E.U. wants to allow countries to protect "sensitive" farm products from some tariff cuts -- enough for the Europeans to keep out many products from the United States and other big exporting countries. Europeans also want exclusive use of product names such as feta cheese.
CSC Asks for More Bids
Computer Sciences Corp. sought other offers after Lockheed Martin and three private equity firms bid for the information technology firm. Bethesda-based Lockheed, looking to offset an expected slowdown in orders for weapons, would take over CSC's growing government business, while the private investors would get a commercial business that faces a soft market and stepped-up competition from IBM, EDS and lower-cost Indian firms. CSC's stock price, which hit a 52-week low in April, jumped 11 percent on the news.