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    Biden Expands Effort to Lower Gas Prices and Secure Energy Independence

    Depleting emergency oil reserves spurs criticism that the White House is trying to lower gas prices with midterm election politics in mind.The president rejected the notion that the move to release more oil was politically motivated by the upcoming midterm elections.Haiyun Jiang/The New York TimesWASHINGTON — President Biden expanded his efforts on Wednesday to blunt the pain of rising gas prices and reduce America’s exposure to global energy markets, which have become more volatile because of provocative actions by Russia and Saudi Arabia.The administration announced $2.8 billion in grants to expand domestic manufacturing of batteries for electric vehicles and the electrical grid, one day after officials said that the United States would release millions of barrels of oil from the Strategic Petroleum Reserve and that Mr. Biden would consider additional withdrawals this winter.The moves highlight how energy security is now at the center of the Biden administration’s economic agenda, which has been derailed by soaring inflation and Russia’s war in Ukraine. Those concerns come at a perilous political moment, with midterm elections that will determine dynamics in Washington less than three weeks away.Mr. Biden’s decision to order the release of 15 million additional barrels of oil from the Strategic Petroleum Reserve is designed to address the immediate worry of rising gas prices, which was exacerbated further by Saudi Arabia’s recent decision, in concert with Russia, to cut oil production. In total, 180 million barrels of oil have been released since Mr. Biden authorized the use of the reserve in March.The Biden administration is prepared to dip further into its emergency supplies this winter, despite concerns that depleting the reserve could put the nation’s energy security at risk.“We’re calling it a ready and release plan,” Mr. Biden said on Wednesday. “This allows us to move quickly to prevent oil price spikes and respond to international events.”Mr. Biden has described the releases as a way to blunt the impact of Russia’s war in Ukraine while domestic energy producers ramp up production. There are about 400 million barrels remaining in the stockpile, which has the capacity to hold about 700 million barrels.The Biden PresidencyWith midterm elections approaching, here’s where President Biden stands.Storyteller in Chief: President Biden has been unable to break himself of the habit of spinning embellished narratives to weave a political identity.Diplomatic Limits: OPEC’s decision to curb oil production has exposed the failure of President Biden’s fist-bump diplomacy with the crown prince of Saudi Arabia.Defending Democracy: Mr. Biden’s drive to buttress democracy at home and abroad has taken on more urgency by the persistent power of China, Russia and former President Donald J. Trump.Questions About 2024: Mr. Biden has said he plans to run for a second term, but at 79, his age has become an uncomfortable issue.In remarks at the White House, Mr. Biden rebutted the notion that his administration had placed curbs on domestic oil production. Instead, he called on companies to expand production and said even if demand for oil slows in future years, they would be able to sell it back to the federal government to refill the Strategic Petroleum Reserve when oil prices decline to around $70 a barrel.The president also accused oil companies of profiteering and warned them not to gouge prices as Americans are grappling with inflation.“When the cost of oil comes down, we should see the price of the gas station at the pump come down as well,” he said. “My message to the American energy companies is, you should not be using your profits to buy back stock or for dividends. Not now. Not while a war is raging.”Separately on Wednesday, the White House announced that the Energy Department is awarding $2.8 billion of grants that were created as part of the infrastructure legislation passed earlier this year..css-1v2n82w{max-width:600px;width:calc(100% – 40px);margin-top:20px;margin-bottom:25px;height:auto;margin-left:auto;margin-right:auto;font-family:nyt-franklin;color:var(–color-content-secondary,#363636);}@media only screen and (max-width:480px){.css-1v2n82w{margin-left:20px;margin-right:20px;}}@media only screen and (min-width:1024px){.css-1v2n82w{width:600px;}}.css-161d8zr{width:40px;margin-bottom:18px;text-align:left;margin-left:0;color:var(–color-content-primary,#121212);border:1px solid var(–color-content-primary,#121212);}@media only screen and (max-width:480px){.css-161d8zr{width:30px;margin-bottom:15px;}}.css-tjtq43{line-height:25px;}@media only screen and (max-width:480px){.css-tjtq43{line-height:24px;}}.css-x1k33h{font-family:nyt-cheltenham;font-size:19px;font-weight:700;line-height:25px;}.css-1hvpcve{font-size:17px;font-weight:300;line-height:25px;}.css-1hvpcve em{font-style:italic;}.css-1hvpcve strong{font-weight:bold;}.css-1hvpcve a{font-weight:500;color:var(–color-content-secondary,#363636);}.css-1c013uz{margin-top:18px;margin-bottom:22px;}@media only screen and (max-width:480px){.css-1c013uz{font-size:14px;margin-top:15px;margin-bottom:20px;}}.css-1c013uz a{color:var(–color-signal-editorial,#326891);-webkit-text-decoration:underline;text-decoration:underline;font-weight:500;font-size:16px;}@media only screen and (max-width:480px){.css-1c013uz a{font-size:13px;}}.css-1c013uz a:hover{-webkit-text-decoration:none;text-decoration:none;}How Times reporters cover politics. We rely on our journalists to be independent observers. So while Times staff members may vote, they are not allowed to endorse or campaign for candidates or political causes. This includes participating in marches or rallies in support of a movement or giving money to, or raising money for, any political candidate or election cause.Learn more about our process.The money will go to 20 companies in 12 states and will be used for projects related to the production of lithium, graphite and nickel that is used in batteries that power electric vehicles. One grant recipient, Talon Nickel, said it would use the $114 million it had been awarded to help set up a processing facility for battery materials in Mercer County, North Dakota.The North Dakota facility will process ore that the company plans to mine in Minnesota, one link in the first fully domestic supply chain for battery-grade nickel that Talon is building out in partnership with Tesla.While the Biden administration has stressed the importance of building up some domestic manufacturing of electric vehicle batteries, which is now heavily reliant on China, administration officials have also acknowledged the pollution risks in permitting new mines and processing facilities in the United States.Talon’s plan to build an underground mine to extract nickel from a water-rich area of northern Minnesota drew concerns from some in the area, including Ojibwe tribes who gather wild rice nearby.Todd Malan, the company’s chief external affairs officer, said the decision to locate the processing facility at an industrial site in North Dakota, instead of near the company’s proposed mine in Minnesota, was a “direct response” to those concerns. He said the company would create a “cemented containment facility” that would neutralize and contain waste from ore processing.“We hope that this is seen as a step toward addressing their concerns while still producing the necessary materials for the U.S. electric vehicle battery supply chain,” he said.Gene Berdichevsky, the co-founder and chief executive of Sila, a maker of battery materials, said the $100 million grant the company received would allow it to expand the size of a factory in Moses Lake, Wash.Sila’s technology substitutes silicon for graphite in electric vehicle batteries, making them smaller and lighter and reducing the need for materials imported from China. Mercedes-Benz, Sila’s first announced customer, plans to deploy the technology in sport utility vehicles that will be available for sale around the middle of the decade.During a manufacturing event at the White House with recipients of the grants, Mr. Biden described the race to make batteries in the United States as part of a broader economic contest with China. He noted that 75 percent of battery manufacturing is done in China and that the country controls nearly half of the global production of the contents of batteries.“China’s battery technology is not more innovative than anyone else,” Mr. Biden said. “By undercutting U.S. manufacturers with their unfair subsidies and trade practices, China seized a significant portion of the market. Today we’re stepping up, really, to take it back.”The grant funds, which could take years to yield results, are part of the Biden administration’s longer-term strategy to transition away from cars with combustion engines and reach a goal of making half of all new vehicles sold electric by 2030.But the use of the strategic oil reserves has fueled criticism that Mr. Biden is putting the nation’s near-term energy security at risk for political purposes.“The Strategic Petroleum Reserve was built for a national energy crisis — not for a Democrat election crisis,” said Senator John Barrasso, Republican of Wyoming. “Joe Biden is draining our emergency oil supply to a 40-year low.”Mr. Barrasso, the top Republican on the Senate Energy and Natural Resources Committee, said the president’s “dismal approval rating is not a justifiable reason to continue to raid our nation’s oil reserves.”On Wednesday, Mr. Biden denied that he was releasing more oil with the midterm elections in mind.“It’s not politically motivated at all,” Mr. Biden said, explaining that he has been working for months to lower gas prices. “It’s motivated to make sure that I continue to push on what I’ve been pushing.”Jack Ewing More

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    Fact-Checking a GOP Attack Ad That Blames a Democrat for Inflation

    In a Nevada tossup race that could help decide whether Republicans gain control of the House, a super PAC aligned with congressional G.O.P. leaders recently mounted an economically driven attack against Representative Dina Titus.In a 30-second ad released on Saturday, the Congressional Leadership Fund accused Ms. Titus, a Democrat who represents Las Vegas, of supporting runaway spending that has exacerbated inflation.Here’s a fact check.WHAT WAS SAID“Economists said excessive spending would lead to inflation, but she didn’t listen. Titus recklessly spent trillions of taxpayer dollars,” the ad’s narrator says, and, later: “Now we’re paying the price. Higher prices on everything. Economy in recession. Dina Titus. She spent big … and we got burned.”This lacks context. The implication here is that Democrats’ policies led to inflation. We recently put this question to our economics correspondent, Ben Casselman, who said: “True, although we can argue all day about how much.”He explains: “Here’s what I think we can say with confidence: Inflation soared last year, primarily for a bunch of pandemic-related reasons — snarled supply chains, shifts in consumer demand — but also at least in part because of all the stimulus money that we poured into the economy. Then, just when most forecasters expected inflation to start falling, it took off again because of the jump in oil prices tied to the war in Ukraine.The State of the 2022 Midterm ElectionsWith the primaries over, both parties are shifting their focus to the general election on Nov. 8.A Focus on Crime: In the final phase of the midterm campaign, Republicans are stepping up their attacks about crime rates, but Democrats are pushing back.Pennsylvania Governor’s Race: Doug Mastriano, the Trump-backed G.O.P. nominee, is being heavily outspent and trails badly in polling. National Republicans are showing little desire to help him.Megastate G.O.P. Rivalry: Against the backdrop of their re-election bids, Gov. Greg Abbott of Texas and Gov. Ron DeSantis of Florida are locked in an increasingly high-stakes contest of one-upmanship.Rushing to Raise Money: Senate Republican nominees are taking precious time from the campaign trail to gather cash from lobbyists in Washington — and close their fund-raising gap with Democratic rivals.“Now, inflation is falling again. Overall consumer prices were up just 0.1 percent in August, and a separate measure showed prices falling in July. But a lot of that is because of the recent drop in gas prices, which we all know could reverse at any time. So-called core inflation, which sets aside volatile food and energy prices, actually accelerated in August.“All of which means we don’t know how long the recent pause in inflation will last, and we definitely don’t know whether Biden will get credit for it if it does.”Backing up a bit, it’s worth noting that not all of the stimulus spending was at the direction of President Biden and Democrats. The first two rounds were approved during the Trump administration. And, economists were not united in warning about inflation.As for the economy being in recession? “Most economists still don’t think the United States meets the formal definition,” Mr. Casselman wrote in July, and he said that remained true as we head into October. But such calls are only made in retrospect. “Even if we are already in a recession, we might not know it — or, at least, might not have official confirmation of it — until next year,” Mr. Casselman said.What was said“Tax breaks for luxury electric cars.”This is true. The Inflation Reduction Act contains a tax credit for electric vehicles. Their final assembly must be completed in North America to be eligible for the credit, which, indeed, extends to several luxury automakers. The list includes Audi, BMW, Lincoln and Mercedes, but also non-luxury models like the Ford Escape and Nissan Leaf. What about Tesla? It made the list of 2022 models, but it has already reached a federal cap of the number of vehicles eligible for the credit, according to the Energy Department.What was said“Even a billion dollars to prisoners, including the Boston Bomber.”This is exaggerated. Dzhokhar Tsarnaev, who was convicted of helping carry out the 2013 Boston Marathon bombings, received a $1,400 Covid-19 stimulus rebate from the federal government in June 2021. The money was part of the American Rescue Plan Act, which President Biden signed into law after it passed the House on a mostly party-line vote, with Ms. Titus supporting it.But what the Republican attack ad failed to disclose was that Mr. Tsarnaev was required by a federal judge to return the money as part of restitution payments to his victims. Another glaring omission was the fact that inmates were previously eligible for Covid-19 relief payments when former President Donald J. Trump was in office, though the Internal Revenue Service and some Republicans had later tried to rescind the payments. A federal judge thwarted those efforts, ruling that inmates could keep the payments.Those nuances haven’t stopped Republicans from latching onto the issue of inmates receiving Covid-19 payments against Democrats in key races across the nation, including Senator Raphael Warnock of Georgia and Senator Mark Kelly of Arizona. More

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    Your Monday Briefing: Europe’s Energy Protections

    Plus Chileans vote on a new constitution and rickshaws lead India’s electric vehicle transition.In Europe, natural gas costs about 10 times as much as it did a year ago.Hannibal Hanschke/ReutersEurope tries to protect its economyThe war in Ukraine has roiled Europe’s economy. Now, as energy costs surge, countries are scrambling to prepare for winter.This weekend, Germany, Sweden and the Czech Republic moved to introduce measures aimed at tackling soaring energy costs and inflation; France is also embarking on its biggest conservation effort since the 1970s oil crisis.Concerns that rising prices could stoke social unrest are growing. Tens of thousands of demonstrators took to the streets in Prague on Saturday, and other protests are being planned in Germany.The moves came days after Gazprom, the Kremlin-controlled energy giant, announced an indefinite halt to the Nord Stream 1 pipeline, which ends in Germany and provides gas to much of Europe. On the same day, finance ministers for the Group of 7 countries had agreed to impose a price cap on Russian oil in an effort to cut some of Moscow’s energy revenue. Here are live updates.What’s next: E.U. energy ministers are preparing for an emergency meeting this week.Other stories:The U.N. stationed two nuclear experts at the Zaporizhzhia nuclear plant, hoping their presence would lower the risk of a catastrophic attack. But the plant lost the connection with its last remaining main external power line after shelling on Friday.Thousands turned out for Mikhail Gorbachev’s funeral in Moscow on Saturday. Vladimir Putin, the president of Russia, did not attend.Ukraine’s southern counteroffensive has retaken several Russian-controlled villages. Deadly shelling continues in the east.Some Chileans worry that if the new charter is approved, it will change their country too drastically.Tomas Munita for The New York TimesChile votes on a new constitutionChile voted yesterday on whether to adopt a new constitution that would enshrine over 100 rights, more than any other nation’s charter.In a single ballot yesterday, Chileans decided whether they wanted universal public health care; the right to legal abortion; gender parity in government; empowered labor unions; greater autonomy for Indigenous groups; rights for animals and nature; and constitutional rights to housing, education, retirement benefits, internet access, clean air, water, sanitation and care “from birth to death.”The results of the vote have not yet been released. If approved, the new constitution could transform what has long been one of Latin America’s most conservative countries into one of the world’s most left-leaning societies.What’s next: Polls suggest that Chileans will reject the new charter. Many Chileans worry that it would change their country too drastically, and the country’s leftist president, Gabriel Boric, has faced plummeting approval ratings.The State of the WarPrice Cap: Finance ministers from the Group of 7 nations agreed to form an international buyers’ cartel to cap the price of Russian oil, a move that could drain President Vladimir V. Putin’s war chest.U.N. Inspection: Amid fears of a possible nuclear accident at the Zaporizhzhia power plant, a United Nations team braved shelling to conduct an inspection of the Russian-controlled station.Russia’s Military Expansion: Though Mr. Putin ordered a sharp increase in the size of Russia’s armed forces, he seems reluctant to declare a draft. Here is why.Unusual Approaches: Ukrainian troops, facing strained supply lines, are turning to jury-rigged weapons and equipment bartering among units.Details: The national vote was mandatory and followed three years of protests, campaigning and debate over the new constitution, which was written from scratch. The current constitution has roots in the brutal dictatorship of Gen. Augusto Pinochet, who ruled from 1973 to 1990.Indigenous rights: The most contentious proposal would define Chile as a “plurinational” state representing some of the most expansive rights for Indigenous people anywhere.A driver swapping a fresh battery into an electric moped.Atul Loke for The New York TimesIndia’s electric rickshawsIn India, low-cost mopeds and rickshaw taxis are leading the transition to electric vehicles.The two- and three-wheeled vehicles sell for as little as $1,000, a far cry from the electric car market in the U.S., where Teslas can cost more than $60,000. Even relatively cheap models can cost more than $25,000.In India, where the median income is just $2,400, competition and subsidies have made electric mopeds and rickshaws as cheap as or cheaper than internal-combustion models. The market is growing: Indian automakers sold 430,000 electric vehicles in the 12 months that ended in March, more than three times as many as they sold a year earlier. Most were two- and three-wheeled vehicles.Environmentalists and the government are celebrating the scooters as a way to clear oppressive smog. Their success could serve as a template for other developing countries — supplied, perhaps, by Indian manufacturers.Details: Rickshaw drivers in New Delhi can trade depleted batteries for fully charged ones at swapping stations. Fresh batteries cost about half as much as a full tank on a conventional vehicle.THE LATEST NEWSAsiaA U.S.-made howitzer during a drill in Taiwan last month.Taiwan’s Ministry of National Defense, via Agence France-Presse/ Getty ImagesThe U.S. plans to sell more than $1.1 billion worth of arms to Taiwan that are designed to repel a seaborne invasion. Beijing threatened countermeasures.Gotabaya Rajapaksa, who was ousted as the president of Sri Lanka this summer, returned to the country on Friday.Aung San Suu Kyi, Myanmar’s ousted civilian leader, was sentenced to three more years in prison, with hard labor, on Friday. She now faces 20 years.An explosion at an Afghan mosque killed at least 18 people on Friday, including Mawlawi Mujib Rahman Ansari, a prominent cleric close to the Taliban.News Coming TodayBritain is about to announce its new prime minister. Liz Truss, the fervently pro-Brexit foreign secretary, is the front-runner.Kenya’s Supreme Court is expected to decide by today if the results of the country’s presidential election should stand.Defense hearings are expected to begin in the corruption trial of Argentina’s vice president, Cristina Fernández de Kirchner, days after she survived an assassination attack.World NewsThe U.S. economy added 315,000 jobs in August, a sign that the labor market is slowing but staying strong.Gazan officials announced the executions of five Palestinians. Two were accused of spying for Israel.Investigators seized 27 artifacts from the Metropolitan Museum of Art, saying they had been looted.What Else Is HappeningJason Allen’s “Théâtre D’opéra Spatial,” which was created using an artificial intelligence program, took first place in the digital category at the Colorado State Fair.via Jason AllenA picture generated by artificial intelligence incited controversy after winning an art prize at the Colorado State Fair.NASA again postponed the launch of its moon rocket on Saturday, this time because of a hydrogen leak.Serena Williams has likely played her final match. After a thrilling run through the early rounds of the U.S. Open, she lost to Ajla Tomljanovic of Australia.New footage of the Titanic shows the ship in detail. It also highlights the next stage in deep-sea tourism: $250,000 for a seat on a submersible to see the wreck.A Morning ReadTulsi Gowind Gowda said she liked trees “more than anything else in my life.”Priyadarshini Ravichandran for The New York TimesWhen India was under British rule, the colonizers led a huge deforestation drive in the mountains of the state of Karnataka, in southern India. One woman, Tulsi Gowind Gowda, has devoted her life to transforming the vast swaths of barren land into dense forests.ARTS AND IDEASShein is officially pronounced “she-in,” though often pronounced “sheen.”Cooper Neill for The New York TimesUnited We SheinShein, the supercheap fast-fashion megagiant, is continuing its rise in America.The craze is real: TikTok is awash with “haul” clips of people showing off their large orders. The Chinese company recently surpassed Amazon as the most downloaded shopping app in the U.S., according to a recent analysis. One couple even got engaged at a pop-up store in Texas.But the brand has also faced many controversies. Shein has been accused by critics of contributing to overconsumption and waste; selling a $2.50 swastika necklace; copying the work of designers; and offering a toddler’s jacket and tiny purse with elevated levels of lead. It has also been accused of working with suppliers that violate labor laws.It’s not enough to deter devotees. One budding fashion influencer said she saw comments about the controversies on videos “all the time,” but suggested that Shein had become a target for being an “underdog.” A video she made about her Shein wedding dress, which cost $39 Canadian, has been liked more than 900,000 times.PLAY, WATCH, EATWhat to CookJoe Lingeman for The New York Times. Food Stylist: Barrett Washburne.This pad krapow gai, a one-pan stir-fry of chicken and basil, is a riff on Thai street food.FashionA Times climate reporter tested clothes designed for rising global temperatures.TravelAsk a flight attendant: Who gets which armrests?Now Time to PlayPlay today’s Mini Crossword.Here are today’s Wordle and today’s Spelling Bee.You can find all our puzzles here.That’s it for today’s briefing. See you next time. — AmeliaNote: Friday’s newsletter was addressed as “Your Thursday Briefing.”P.S. Natalie Kitroeff will take over as Mexico City bureau chief from Maria Abi-Habib, who’s becoming an investigative correspondent.The latest episode of “The Daily” is about Vancouver’s approach to its fentanyl crisis.You can reach Amelia and the team at briefing@nytimes.com. More

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    As Germany Election Nears, Merkel Leaves a Strong But Vulnerable Economy

    Chancellor Angela Merkel steered Europe through crises, and Germany has boomed during her tenure. But she has ducked changes needed to ensure the success lasts, analysts say.During her 16 years as Germany’s chancellor, Angela Merkel has become an international avatar of calm, reason and democratic values for the way she handled crises that included a near financial meltdown of the eurozone, the arrival of more than a million migrants and a pandemic.Today Germany is an economic colossus, the engine of Europe, enjoying prosperity and near full employment despite the pandemic. But can it last?That is the question looming as Ms. Merkel prepares to leave the political stage after national elections on Sept. 26. There are signs that Germany is economically vulnerable, losing competitiveness and unprepared for a future shaped by technology and the rivalry between the United States and China.During her tenure, economists say, Germany neglected to build world-class digital infrastructure, bungled a hasty exit from nuclear power, and became alarmingly dependent on China as a market for its autos and other exports.The China question is especially complex. Germany’s strong growth during Ms. Merkel’s tenure was largely a result of trade with China, which she helped promote. But, increasingly, China is becoming a competitor in areas like industrial machinery and electric vehicles.Economists say that Germany has not invested enough in education and in emerging technologies like artificial intelligence and electric vehicles. Germans pay some of the highest energy prices in the world because Ms. Merkel pushed to close nuclear power plants, without expanding the country’s network of renewable energy sources enough to cover the deficit.Ms. Merkel met President Xi Jinping of China, second right, in Beijing in 2019. Germany has grown strongly through trade with China, but they’re also increasingly competitors. Pool photo by Michael Kappeler“That is going to come back to haunt Germany in the next 10 years,” said Guntram Wolff, director of Bruegel, a research institute in Brussels.There was never much pressure on Ms. Merkel to focus on fundamental economic policy because the German economy has boomed during her tenure. Germany has recovered from the pandemic faster than other European countries like France or Italy.But the pandemic has also exposed Germany’s economic dependence on China.In 2005, China accounted for a fraction of German exports. Last year it surpassed the United States as Germany’s largest trading partner. China is the biggest market by far for the automakers Volkswagen, Mercedes-Benz and BMW. German companies have also thrived by equipping Chinese factories with machine tools and other industrial goods that made China an export powerhouse.Ms. Merkel abandoned her early emphasis on human rights in her relations with the Chinese government and instead encouraged ever deeper economic ties. She hosted Chinese leaders in Berlin and traveled 12 times to Beijing and other cities in China, often with delegations of German business managers. But Germany’s economic entanglement with China has made it increasingly vulnerable to pressure from China’s president, Xi Jinping.Late last year, while Germany took its official turn setting the agenda of the European Union, Ms. Merkel and President Emmanuel Macron of France pushed through an investment accord with China over the objections of the incoming Biden administration, largely bypassing other European allies.“German trade with China dwarfs all other member states, and Germany clearly drives policy on China in the E.U.,” said Theresa Fallon, director of the Center for Russia Europe Asia Studies in Brussels. Germany’s economic dependence on China “is driving a wedge in trans-Atlantic relations,” Ms. Fallon said.An electric Mercedes Benz at the International Motor Show in Munich this month. Germany has only recently moved to match U.S. incentives for buyers of electric cars.Felix Schmitt for The New York TimesIn recent years China has been using what it learned from German companies to compete with them. Chinese carmakers including Nio and BYD are beginning to sell electric vehicles in Europe. China has become the No. 2 exporter of industrial machinery, after Germany, according to the VDMA, which represents German engineering companies.Ms. Merkel’s supporters say that she has helped the German economy dodge some bullets. Her sharp political instincts proved valuable during a eurozone debt crisis that began in 2010 and nearly destroyed the currency that Germany shares with 18 other countries. Ms. Merkel arguably kept hard-liners in her own Christian Democratic Union in check as the European Central Bank printed money to help stricken countries like Greece, Italy and Spain.But her longtime finance minister, Wolfgang Schäuble, was also a leading enforcer of policies that protected German banks while imposing harsh austerity on southern Europe. At the time, Germany refused to back the idea of collective European debt — a position that Ms. Merkel abandoned last year, when faced with the fallout from a pandemic that threatened European unity.Ms. Merkel had some luck on her side, too. The former communist states of East Germany largely caught up during her tenure. And Ms. Merkel profited from reforms made by her predecessor, Gerhard Schröder, which made it easier for firms to hire and fire and put pressure on unemployed people to take low-wage jobs.Mr. Schröder’s economic overhaul led to a sharp decline in unemployment, from more than 11 percent when Ms. Merkel took office to less than 4 percent. But the changes were unpopular because they weakened regulations that shielded Germans from layoffs. They paved the way for Mr. Schröder’s defeat by Ms. Merkel in 2005.The lesson for German politicians was that it was better not to tamper with Germans’ privileges, and for the most part Ms. Merkel did not. Many of the jobs created were low wage and offered limited chances for upward mobility. The result has also been a rise in social disparity, with a rapidly aging population increasingly threatened by poverty.“Over the past 15 to 16 years we have seen a clear increase in the number of people who live below the poverty line and are threatened,” said Marcel Fratzscher, an economist at the D.I.W. research institute in Berlin. “Although the 2010 years were very economically successful, not everyone has benefited.”Ms. Merkel’s failure to invest more in infrastructure, research and education, despite her background as a doctor of physics, also reflects the German aversion to public debt. Mr. Schäuble, as finance minister, enforced fiscal discipline that prioritized budget surpluses over investment. The German Parliament, controlled by Ms. Merkel’s party, even enshrined balanced budgets in law, a so-called debt brake.A school in Berlin last year. Economists say that Germany has not invested enough in education and in emerging technologies.Lena Mucha for The New York TimesThe frugal policies were popular among Germans who associate deficit spending with runaway inflation. But they also let Germany fall behind other nations.Since 2016 Germany has slipped from 15th to 18th place in rankings of digital competitiveness by the Institute for Management and Development in Lausanne, Switzerland, which attributed the decline partly to inferior training and education as well as government regulations. Between 40 to 50 percent of all workers in Germany will need to retrain in digital skills to keep working within the next decade, according to the Labor Ministry. Most German schools lack broadband internet and teachers are reluctant to use digital learning tools — a situation that became woefully apparent during the coronavirus lockdowns.“Technology is strategic. It’s a key instrument in the systemic rivalry we have with China,” Omid Nouripour, a lawmaker who speaks for the Green Party on foreign affairs, said during an online discussion this month organized by Berenberg Bank. “We didn’t create enough awareness of that in the past.”The need for Germany to modernize has become more urgent as climate change has become more tangible, and as a shift to electric vehicles threatens the hegemony of German luxury automakers. Tesla has already taken significant market share from BMW, Mercedes-Benz and Audi, and is building a factory near Berlin to challenge them on their home turf. Until last year, the financial incentives that the German government offered to buyers of electric cars were substantially smaller than the tax credits available in the United States.Wind turbines, mining and coal power in Garzweiler, Germany. Ms. Merkel pushed the country away from nuclear energy, but without renewables quickly filling the gap.Ina Fassbender/Agence France-Presse — Getty Images“What is very important for Germany as an industrial nation, and also for Europe as a place for innovation, is a symbiosis between an ambitious climate policy and a very strong economic policy,” Ola Källenius, the chief executive of Daimler, told reporters at the IAA Mobility trade fair in Munich.Auto executives do not criticize Ms. Merkel, who has been a strong advocate for their interests in Berlin and abroad. But they implicitly fault her government’s sluggish response to the shift to electric vehicles. While Germany has more charging stations per capita than the United States, there are not enough to support increasing demand for electric vehicles.“The framework for this transition of the auto industry is not complete yet,” said Oliver Zipse, the chief executive of BMW and president of the European Automobile Manufacturers’ Association. “We need an industry policy framework that begins with charging infrastructure.”Said Mr. Källenius of Daimler, “We are in an economic competition with the United States, North America with China, with other strong Asian countries. We need an economic policy that ensures that Europe remains attractive for investment.” More

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    California Recall Vote Could Weaken the State’s Aggressive Climate Policies

    Many Republicans vying to replace Newsom as governor want to roll back the state’s ambitious plans to cut planet-warming emissions, a change with nationwide implications.Follow our latest updates on the California Recall Election and Governor Newsom.California has long cast itself as a leader in the fight against global warming, with more solar panels and electric cars than anywhere else in the nation. But the state’s ambitious climate policies now face their biggest reckoning to date.Voters in California are deciding whether to oust Democratic Gov. Gavin Newsom ahead of a Sept. 14 recall election. Many of the Republicans vying to replace Mr. Newsom want to roll back the state’s aggressive plans to curb its planet-warming emissions, a move that could have nationwide implications for efforts to tackle climate change given California’s influence as the world’s fifth-largest economy.Under the rules of the election, Mr. Newsom would be removed from office if more than 50 percent of voters choose to recall him. If that happens, the governorship would go to whichever of the 46 replacement candidates on the ballot gets the most votes — even if that person does not win a majority.Democrats have worried that Mr. Newsom could lose, although polling over the past week suggests that voters in the state have started rallying around him.Polls say the leading Republican is Larry Elder, a conservative radio host who said in an interview that “global warming alarmism is a crock” and that he intends “to stop the war on oil and gas.” Another top candidate, Republican businessman John Cox, says California’s climate policies have made the state unaffordable for many. Also running is Kevin Faulconer, a former Republican mayor of San Diego, who oversaw the city’s first climate plan but has taken issue with Mr. Newsom’s approach.“There’s the real potential for a huge shift in direction,” said Richard Frank, a professor of environmental law at the University of California, Davis. “California has had substantial influence over the direction of climate policy both nationally and internationally, and that could easily wane.”Under the past three governors — Arnold Schwarzenegger, Jerry Brown and Mr. Newsom — California has enacted some of the most far-reaching laws and regulations in the country to shift away from fossil fuels.That includes a requirement that utilities get 100 percent of their electricity from clean sources like wind and solar power by 2045, regulations to limit tailpipe pollution from cars and trucks and building codes that encourage developers to shift away from natural gas for home heating. California’s legislature has ordered the state’s powerful air regulator, the Air Resources Board, to slash statewide emissions 40 percent below 1990 levels by 2030.While California accounts for only a fraction of the nation’s emissions, it often serves as a testing ground for climate policy. Its clean electricity standard has been mirrored by states like New York and Colorado, and Democrats in Congress are now crafting a nationwide version..css-1xzcza9{list-style-type:disc;padding-inline-start:1em;}.css-3btd0c{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-3btd0c{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-3btd0c strong{font-weight:600;}.css-3btd0c em{font-style:italic;}.css-w739ur{margin:0 auto 5px;font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:1.125rem;line-height:1.3125rem;color:#121212;}#NYT_BELOW_MAIN_CONTENT_REGION .css-w739ur{font-family:nyt-cheltenham,georgia,’times new roman’,times,serif;font-weight:700;font-size:1.375rem;line-height:1.625rem;}@media (min-width:740px){#NYT_BELOW_MAIN_CONTENT_REGION .css-w739ur{font-size:1.6875rem;line-height:1.875rem;}}@media (min-width:740px){.css-w739ur{font-size:1.25rem;line-height:1.4375rem;}}.css-9s9ecg{margin-bottom:15px;}.css-uf1ume{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-box-pack:justify;-webkit-justify-content:space-between;-ms-flex-pack:justify;justify-content:space-between;}.css-wxi1cx{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-flex-direction:column;-ms-flex-direction:column;flex-direction:column;-webkit-align-self:flex-end;-ms-flex-item-align:end;align-self:flex-end;}.css-12vbvwq{background-color:white;border:1px solid #e2e2e2;width:calc(100% – 40px);max-width:600px;margin:1.5rem auto 1.9rem;padding:15px;box-sizing:border-box;}@media (min-width:740px){.css-12vbvwq{padding:20px;width:100%;}}.css-12vbvwq:focus{outline:1px solid #e2e2e2;}#NYT_BELOW_MAIN_CONTENT_REGION .css-12vbvwq{border:none;padding:10px 0 0;border-top:2px solid #121212;}.css-12vbvwq[data-truncated] .css-rdoyk0{-webkit-transform:rotate(0deg);-ms-transform:rotate(0deg);transform:rotate(0deg);}.css-12vbvwq[data-truncated] .css-eb027h{max-height:300px;overflow:hidden;-webkit-transition:none;transition:none;}.css-12vbvwq[data-truncated] .css-5gimkt:after{content:’See more’;}.css-12vbvwq[data-truncated] .css-6mllg9{opacity:1;}.css-qjk116{margin:0 auto;overflow:hidden;}.css-qjk116 strong{font-weight:700;}.css-qjk116 em{font-style:italic;}.css-qjk116 a{color:#326891;-webkit-text-decoration:underline;text-decoration:underline;text-underline-offset:1px;-webkit-text-decoration-thickness:1px;text-decoration-thickness:1px;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:visited{color:#326891;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:hover{-webkit-text-decoration:none;text-decoration:none;}Under the federal Clean Air Act, California is the only state allowed to set its own vehicle pollution rules. California’s rules have been adopted by 14 other states and have frequently pushed the federal government to ratchet up its own regulations.California has installed more solar power than any other state.Patrick T. Fallon/Agence France-Presse — Getty ImagesBut California has also struggled with the transition to cleaner energy and the effects of global warming. Last August, a record heat wave triggered rolling blackouts across the state, in part because grid operators had not added enough clean power to compensate for solar panels going offline after sunset. Pacific Gas and Electric, the state’s largest utility, has repeatedly had to switch off electricity to customers to avoid sparking wildfires.As the top elected official in a state reeling from record-breaking drought and raging fires, Mr. Newsom has faced pressure to do more. Last September, he directed the Air Resources Board to develop regulations that ban sales of new gasoline-powered cars statewide by 2035. He has called on agencies to place new restrictions on oil and gas drilling. More recently, the state’s transportation agency finalized a plan to direct more funding to measures that would curb emissions, such as public transit or biking.And in his most recent budget, Mr. Newsom directed more than $12 billion toward a spate of climate programs, including electric vehicle chargers, measures to deal with worsening water shortages and efforts to protect forest communities against wildfires.In his campaign against the recall, Mr. Newsom has attacked his opponents for downplaying the risks of global warming. “With all due respect, he doesn’t know what the hell he’s talking about when it comes to the issue of climate and climate change,” Mr. Newsom said of Mr. Elder in an interview last month with ABC News.“California’s been in the vanguard of climate leadership, and all of that can be undone very quickly,” said Nathan Click, a spokesman for Mr. Newsom’s campaign.Mr. Cox and other Republican rivals say Mr. Newsom has not done enough to manage California’s forests to make them less fire-prone. They argue that the flurry of environmental regulations is driving up costs in a state that already faces a severe housing shortage.“I’m all for cleaning up the world’s pollution, but not on the backs of the middle class and low income people,” said Mr. Cox, who ran unsuccessfully against Mr. Newsom in 2018. “When China’s building a new coal-fired power plant every week, do you really think driving up the cost of energy in our state is going to make an appreciable difference?”If Mr. Newsom is recalled, a new governor would be unlikely to overturn many of California’s key climate laws, not least because the legislature would stay in Democratic hands. But that still leaves room for major changes.Firefighting plane above the Dixie Fire late last week.Christian Monterrosa for The New York TimesA new governor could, for instance, rescind Mr. Newsom’s order to phase out new gasoline-powered vehicles by 2035 or his push to restrict oil and gas drilling, since those were issued by executive order. A governor could also appoint new officials who were less keen on climate regulation to various agencies, including the Air Resources Board, although doing so could set up a clash with the legislature, which oversees appointments. Any governor would also have broad latitude in shaping how existing climate laws are implemented.Mr. Elder, the talk radio host, said he did not see climate change as a dire threat and would de-emphasize wind and solar power. “Of course, global warming exists,” he said. “The climate is always changing. Has it gotten a degree or two warmer in the last several years? Yes. Is man-made activity a part of that? Yes. But nobody really knows to what degree.”He added: “The idea that the planet is going to be destroyed if we don’t force feed some sort of renewable system, that’s a crock.”Mr. Elder’s view is at odds with the scientific consensus. Last month, a United Nations scientific panel concluded that virtually all of the global warming since the 19th century was driven by human activities such as the burning of fossil fuels and deforestation. And it warned that consequences such as heat waves, droughts and wildfires would continue to worsen unless nations slashed their planet-warming emissions by shifting to cleaner sources of energy.Instead of focusing on renewable power, Mr. Cox said he would build a bigger fleet of firefighting planes to combat wildfires. He also argued that the United States should increase its natural gas production and ship more of the fuel abroad, so that countries like China could rely on it instead of coal. “If we bring down the cost of natural gas and ship it to China, we’ll do wonderful things for the world’s pollution problem,” he said.Mr. Cox also disagreed with Mr. Newsom’s plan to phase out new gasoline-powered vehicles by 2035. “I drive a Tesla, I’m all for electric cars,” he said. “But we’re already struggling to generate enough electricity for our air-conditioners in August,” he said. “Where are we going to get the electricity for 25 million electric vehicles?”Mr. Faulconer, who is further down in the polls, criticized Mr. Newsom for underfunding the state’s wildfire budget. While he endorsed the state’s push for 100 percent clean electricity, he warned the state risked further blackouts without relying on sources like nuclear power. He also said he would work with the legislature on a policy to boost electric vehicles “that does not rely on a statewide ban” of gasoline-powered cars.All three Republican candidates said they would push to keep open Diablo Canyon, the state’s last remaining nuclear plant, which is set to close by 2025. Critics of the closure have warned it could exacerbate California’s electricity shortage and lead to the burning of more natural gas, which creates emissions.Diablo Canyon, California’s last remaining nuclear plant, is scheduled to close by 2025.Michael Mariant/Associated PressAny new governor would serve only until California’s next election, in 2022, and some experts predicted that political gridlock would largely result. But even short-term gridlock could have a significant effect on climate policy.California is already struggling to meet its target of cutting emissions 40 percent below 1990 levels by 2030. Hitting that goal, analysts said, would likely require all of the state’s agencies to work together, developing additional strategies to curtail fossil-fuel use in power plants, homes and vehicles. It could also require fixing the state’s cap-and-trade program, which caps pollution from large industrial facilities but has attracted criticism for relying on poorly designed carbon offsets.“We don’t have many years left between now and 2030,” said Cara Horowitz, co-director of the Emmett Institute on Climate Change and the Environment at U.C.L.A. Law School. “If we waste a year or more because the Air Resources Board has been told not to prioritize cutting emissions, it’s a lot harder to see how we get there.”That, in turn, could have ripple effects nationwide. President Biden has pledged to halve the nation’s emissions by 2030 and is hoping to persuade other world leaders that the United States has a plan to get there. Without California on board, that task becomes tougher.California also has an outsized influence over clean vehicle standards, in part because it can set its own rules and prod the auto industry to develop cleaner cars. The Biden administration recently proposed to essentially adopt California’s car rules nationwide. Some fear that if California is no longer pushing to ramp up electric vehicles, as Mr. Newsom has envisioned, the federal government will feel less pressure to act.“I can’t think of a single instance where the federal government has moved ahead of California,” said Mary Nichols, the former chair of the Air Resources Board. “California has always had this unique role as a first mover.”Shawn Hubler More