GAZIANTEP, Turkey — In the 10 years since its popular uprising set off the Arab Spring, Tunisia has often been praised as the one success story to emerge from that era of turbulence. It rejected extremism and open warfare, it averted a counterrevolution, and its civic leaders even won a Nobel Peace Prize for consensus building.
Yet for all the praise, Tunisia, a small North African country of 11 million, never fixed the serious economic problems that led to the uprising in the first place.
It also never received the full-throated support of Western backers, something that might have helped it make a real transition from the inequity of dictatorship to prosperous democracy, analysts and activists say. Instead, at critical points in Tunisia’s efforts to remake itself, many of its needs were overlooked by the West, for which the fight against Islamist terrorism overshadowed all other priorities.
Now, as Tunisians grapple with their latest upheaval, which began when President Kais Saied dismissed the prime minister and suspended Parliament over the weekend, many seem divided on whether to condemn his actions — or embrace them.
terrorism and the pandemic, Mr. Kaboub said.
overthrew the country’s authoritarian president of 23 years, Zine el-Abidine Ben Ali.
But Western officials were obsessively focused on the Islamists — namely the Ennahda, or Renaissance, party that swept early elections — and where they were going and what they represented.
“In conversations, those sorts of questions ate up almost all the oxygen in the room,” Ms. Marks said. “It was almost impossible to get anybody to ask another question.”
awarded the Nobel Peace Prize in 2015 — to the point that it became a “fetish,” she said.
After the 2011 revolution, Al Qaeda and other extremists were quick to mobilize networks of recruits.
Terrorism burst into the open in 2012 when the U.S. Embassy in Tunis came under attack from a mob. Over the years that followed, extremist cells carried out a string of political assassinations and suicide attacks that shattered Tunisians’ optimism and nearly derailed the democratic transition.
training and assisting Tunisian security forces, and supplying them with military equipment, but so discreetly that the American forces themselves were virtually invisible.
By 2019, some 150 Americans were training and advising their Tunisian counterparts in one of the largest missions of its kind on the African continent, according to American officials. The value of American military supplies delivered to the country increased to $119 million in 2017 from $12 million in 2012, government data show.
The assistance helped Tunisia defeat the broader threat of terrorism, but government ministers noted that the cost of combating terrorism, while unavoidable, burned a larger hole in the national budget.
But it is the structure of the economy that remains the root of the problem, Mr. Kaboub said. All of Tunisia’s political parties have identical economic plans, based on World Bank and International Monetary Fund guidelines. It was the same development platform used by the ousted president, Mr. Ben Ali, Mr. Kaboub said.
“Right now,” he said, “everybody in Tunisia is begging for an I.M.F. loan, and it is going to be seen as the solution to the crisis. But it is really a trap. It’s a Band-Aid — the infection is still there.”
CAIRO — Tunisia’s fledgling democracy, the only one remaining from the popular revolutions that swept the Arab world a decade ago, trembled on the brink of collapse Monday after its president sought to seize power from the rest of the government in what his political opponents denounced as a coup.
The president, Kais Saied, who announced the power grab late Sunday, did not appear to have completely succeeded in taking control as of Monday evening, as chaos enveloped the North African country. But many Tunisians expressed support for him and even jubilation over his actions, frustrated with an economy that never seemed to improve and a pandemic that has battered hospitals in recent weeks.
With Syria, Yemen and Libya undone by civil war, Egypt’s attempt at democracy crushed by a counterrevolution and protests in the Gulf States quickly extinguished, Tunisia was the only country to emerge from the Arab Spring revolutions with a democracy, if a fragile one.
But the nation where the uprisings began now finds even the remnants of its revolutionary ideals in doubt, posing a major test for the Biden administration’s commitment to democratic principles abroad.
statement. Secretary of State Antony J. Blinken, in a phone call Monday with Mr. Saied, encouraged him “to adhere to the principles of democracy and human rights,” a spokesman said.
Defying the Tunisian president, the prime minister, Hichem Mechichi, said he would hold a cabinet meeting even after Mr. Saied announced the dismissal of him and several ministers. Parts of Parliament said they would meet virtually even as soldiers cordoned off the Parliament building.
But the danger remained that Mr. Saied would back up his power grab with greater force, whether by further deploying the military or arresting top officials.
“This is a very concerning development that puts the democracy at great risk of unraveling,” said Safwan M. Masri, executive vice president of Columbia University’s Global Centers network, who studies Tunisia. Referring to Mr. Saied, he said: “An optimistic scenario would be that the Parliament and the Constitution and democratic institutions would prevail and that he would be forced out of office. But I would not bet any money on it.”
Already, the president has announced that he was assuming the public prosecutor’s powers and stripping lawmakers of immunity.
whether the revolution was worth it.
Protests and strikes frequently racked the country, and popular discontent widened the gap between elites who praised Tunisia’s democratic gains and Tunisians who simply wanted to improve their lot.
The coronavirus pandemic made things worse by devastating Tunisia’s tourist industry, an important economic engine. The virus has shaken the government and the health system even further in recent weeks as Tunisians have died of Covid-19 at the highest rate in the Middle East and Africa.
On Sunday, demonstrators across Tunisia called for the dissolution of Parliament, giving Mr. Saied some popular cover to announce that night that he was firing Mr. Mechichi, freezing Parliament for 30 days and assuming executive authority.
Tarek Megerisi, a senior fellow at the European Council on Foreign Relations. “They blame them for all the country’s problems and think that they need to be removed.”
The showdown was a long time coming, with Mr. Saied locked since his election in political infighting with Mr. Mechichi and the speaker of Parliament, Rachid Ghannouchi.
Mr. Saied has been hinting for months at expanding his authority by refusing to swear in ministers and blocking formation of a constitutional court, raising alarm among opponents and political analysts.
In response to chaos in Tunisia’s Covid-19 vaccination rollout last week and a surge in cases that has overwhelmed hospitals, Mr. Saied stripped control of Tunisia’s coronavirus response from the Health Ministry and handed it to the military.
On Sunday night, Mr. Saied cited Article 80 of the Constitution, which he said permits the president exceptional powers. He said he had consulted both Mr. Mechichi and Mr. Ghannouchi and held an emergency meeting with other officials before acting.
Mr. Saied said he was doing so to preserve the country’s “security and independence and to protect the normal operation of state institutions.”
Article 80, however, accords the president such powers only if the country faces an imminent threat and only after the prime minister and parliament speaker have been consulted. Mr. Ghannouchi denied that he had been.
In a statement, Mr. Ghannouchi deplored what he called a “coup” and described the suspension of Parliament as “unconstitutional, illegal and invalid.” The assembly “remains in place and will fulfill its duty,” he said.
In a televised statement, Mr. Saied said, “This is not a suspension of the Constitution.” And he sounded an ominous warning to adversaries:“Whoever fires a single bullet, our armed and security forces will retaliate with a barrage of bullets.”
Videos posted to social media showed crowds cheering, honking, ululating and waving Tunisian flags after the president’s actions Sunday night, the dark night lit up by red flares. Other videos showed Mr. Saied wending throughcheering supporters alongthe main thoroughfare of Tunis, where revolutionaries gathered during the 2011 protests.
The next step for Tunisia is unclear. The country has so far failed to form the constitutional court, called for in the 2014 Constitution, that could adjudicate such disputes.
In his statement, Mr. Saied said cryptically that a decree would soon be issued “regulating these exceptional measures that the circumstances have dictated.” Those measures, he said, “will be lifted when those circumstances change.” He also fired the defense minister and acting justice minister on Monday afternoon.
Tunisia’s divisions reflect a wider split in the Middle East between regional powers that supported the Arab revolutions and the political Islamist groups that came to power at the time (Turkey and Qatar), and those that countered the uprisings (Saudi Arabia, the United Arab Emirates and Egypt). While Turkey and Qatar expressed concern on Monday, the others remained quiet.
Reporting was contributed by Nada Rashwan from Cairo, Lilia Blaise and Massinissa Benlakehal from Tunis, and Michael Crowley from Washington.
A summer travel bonanza is exceeding expectations, helping airlines earn profits again and brightening the outlook for the rest of the year. It’s a welcome relief for a battered industry and a sign that the rebound that began this spring appears to be here to stay.
The economic upturn, aggressive cost-cutting and an enormous federal stimulus that paid many salaries have helped to improve the finances of the largest carriers, which took on vast amounts of debt and lost billions of dollars during the pandemic.
This month, consumer spending on airlines briefly exceeded 2019 levels on a weekly basis for the first time since the pandemic began, according to Facteus, a research firm that monitors millions of online payments. Ticket prices have rebounded, too: In June, fares were down only 1 percent from the same month in 2019, according to the Adobe Digital Economy Index, which is similarly based on website visits and transactions.
And on Sunday, the Transportation Security Administration screened more than 2.2 million travelers at its airport checkpoints, the most in one day since the start of the pandemic.
planned to hire hundreds of flight attendants and bring back thousands who volunteered for extended leaves during the pandemic.
increase its minimum wage to $15 an hour to retain and attract workers, while Delta is in the middle of hiring thousands of employees. United last month announced plans to buy 270 new planes in the coming years, the largest airplane order in its history and one that would create thousands of jobs nationwide.
Southwest on Thursday reported a profit of $348 million for the quarter that ended in June, its second profitable quarter since the pandemic began. American reported a $19 million profit over the same period, while Delta last week reported a $652 million profit, a pandemic first for each airline. United this week reported a loss, but projected a return to profitability in the third quarter as its business improved faster than forecast.
The financial turnaround has been buoyed by an infusion of $54 billion of federal aid to pay employee salaries over the past year and a half. Without those payments, none of the major airlines would have been able to report profits for the quarter that ended in June. The aid precludes the companies from paying dividends through September 2022.
Each airline offered a hopeful outlook for the current quarter. American projected that passenger capacity would be down only 15 to 20 percent from the third quarter of 2019, while United projected a 26 percent decline and Delta forecast a 28 to 30 percent drop. Southwest, which differs from the other three large carriers in that it operates few international flights, said it expected capacity to be comparable to the third quarter of 2019.
Daily Business Briefing
“We are just really excited about the momentum we’re seeing in the numbers,” Doug Parker, American’s chief executive, told analysts after the company delivered its earnings report.
The financial results and forecasts for the rest of the summer are the latest sign of strength in a comeback that has been building for months. But the airlines have vast amounts of debt to repay — American, the most indebted carrier, announced a plan on Thursday to pay down $15 billion by the end of 2025 — and the rebound hasn’t been free of setbacks.
recent poll from the Global Business Travel Association, an industry association. If other companies follow Apple’s lead in delaying a return to the office, though, the corporate travel recovery could be held back.
Delta said it expected domestic business trips to recover to about 60 percent of 2019 levels by September, up from 40 percent in June. Those figures roughly align with estimates from United.
“The demand is recovering even faster than we had hoped domestically,” Mr. Kirby of United said on Wednesday.
International travel has slowly started to recover, too, as more countries, particularly in Europe, open up to American travelers who can provide proof of vaccination or a negative coronavirus test. But airlines are lobbying the Biden administration to loosen restrictions in kind, which, they say, will allow the recovery to accelerate.
“I think the surge is coming, and just as we’ve seen it on the consumer side, we’re getting ready for it on the business side,” Mr. Bastian of Delta said last week. “Once you open businesses, offices, and you get international markets opened, I think it’s going to be a very good run over the next 12 to 24 months.”
AUSTIN, Texas–(BUSINESS WIRE)–American Campus Communities (NYSE: ACC), the nation’s largest student housing company, has once again been recognized in multiple award categories of Student Housing Business Magazine’s InterFace Conference Innovator Awards.
The Innovator Awards are given to student housing owners, developers, operators, architecture firms and universities for excellence in student housing development, marketing and operations. More than 100 industry experts judged on more than 140 entries in this year’s contest. This was the largest number of submissions to date.
ACC has been honored with the following on-campus awards for 2021:
On-Campus Best Public-Private Financing Solution: Manzanita Square at San Francisco State University – ACC recognized an enormous opportunity to provide development and financial expertise and support to a dedicated project team in the California State University System’s first equity-financed public-private partnership. After a 22-month construction duration, Manzanita Square opened its doors in August 2020. The 584-bed, academically oriented community represents a true win-win-win for the project team, the University and its students.
On-Campus Best Implementation of Mixed-Use/Live-Learn: UIC Academic and Residential Complex – The ARC is home to more than 550 UIC students, providing a purpose-built, academically oriented student living environment and classrooms in the heart of campus. The facility provides modern spaces for residents to live, learn and thrive, including 50,000 square feet of academic space including learning halls, classrooms, study spaces and tutoring centers.
On-Campus Best New Development: University of Illinois Chicago Academic and Residential Complex – In the spring of 2017, UIC engaged ACC to deliver the Academic and Residential Complex (ARC), which represents the first phase of the University’s revitalization initiative. Developed as a public-private partnership among UIC and ACC, the ARC was delivered in Fall 2019 after a 20-month construction process.
On-Campus Best Architecture: UIC Academic and Residential Complex – Campus-wide connection is reinforced through transparency between interior program spaces and the outdoor environment. Amenity spaces are highly visible and concentrated on the ground floor to promote and extend the community’s learning environment. The community’s facade and interiors echo the geometric architecture seen throughout campus, celebrating the university’s urban context while simultaneously maintaining a residential collegiate aesthetic.
“It’s an honor to be recognized alongside our innovative university partners for two communities, Manzanita Square and the UIC Academic and Residential Complex, that go above and beyond to create environments conducive to academic success and personal well-being for our students,” said Bill Bayless, CEO at ACC. “Our ACC team members across the country have remained focused on fulfilling our mission of putting students first and creating a place where they love living.”
Bayless gave the keynote address at the conference on Wednesday, July 14th at the JW Marriott in Austin, Texas. In total, ACC has been awarded 43 SHB Innovator Awards since 2013.
About American Campus Communities
American Campus Communities, Inc. is the largest owner, manager and developer of high-quality student housing communities in the United States. The company is a fully integrated, self-managed and self-administered equity real estate investment trust (REIT) with expertise in the design, finance, development, construction management and operational management of student housing properties. As of March 31, 2021, American Campus Communities owned 166 student housing properties containing approximately 111,900 beds. Including its owned and third-party managed properties, ACC’s total managed portfolio consisted of 207 properties with approximately 142,400 beds. Visit www.americancampus.com.
In addition to historical information, this press release contains forward-looking statements under the applicable federal securities law. These statements are based on management’s current expectations and assumptions regarding markets in which American Campus Communities, Inc. (the “company”) operates, operational strategies, anticipated events and trends, the economy, and other future conditions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. These risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward looking-statements include those related to the COVID-19 pandemic, about which there are still many unknowns, including the duration of the pandemic and the extent of its impact, and those discussed in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2020 under the heading “Risk Factors” and under the heading “Business – Forward-looking Statements” and subsequent quarterly reports on Form 10-Q. We undertake no obligation to publicly update any forward-looking statements, including our preleasing activity or expected full year 2021 operating results, whether as a result of new information, future events, or otherwise.
McDonald’s is raising wages at its company-owned restaurants. It is also helping its franchisees hang on to workers with funding for backup child care, elder care and tuition assistance. Pay is up at Chipotle, too, and Papa John’s and many of its franchisees are offering hiring and referral bonuses.
The reason? “In January, 8 percent of restaurant operators rated recruitment and retention of work force as their top challenge,” Hudson Riehle, senior vice president for research at the National Restaurant Association, said in an email. “By May, that number had risen to 72 percent.”
Restaurant workers — burger flippers and bussers, cooks and waiters — have emerged from the pandemic recession to find themselves in a position they could not have imagined a couple of years ago: They have options. They can afford to wait for a better deal.
In the first five months of the year, restaurants put out 61 percent more “workers wanted” posts for waiters and waitresses than they had in the same months of 2018 and 2019, before the coronavirus pandemic shut down bars and restaurants around the country, according to data from Burning Glass, a job market analytics firm.
replace their face-to-face workers with robots and software. Yet there are signs that the country’s low-wage labor force might be in for more lasting raises.
Even before the pandemic, wages of less-educated workers were rising at the fastest rate in over a decade, propelled by shrinking unemployment. And after the temporary expansion of unemployment insurance ends, with Covid-19 under control and children back at school, workers may be unwilling to accept the deals they accepted in the past.
Jed Kolko, chief economist at the job placement site Indeed, pointed to one bit of evidence: the increase in the reservation wage — the lowest wage that workers will accept to take a job.
According to data from the Federal Reserve Bank of New York, the average reservation wage is growing fastest for workers without a college degree, hitting $61,483 in March, 26 percent more than a year earlier. Aside from a dip at the start of the pandemic, it has been rising since November 2017.
“That suggests it is a deeper trend,” Mr. Kolko noted. “It’s not just about the recovery.”
Other trends could support higher wages at the bottom. The aging of the population, notably, is shrinking the pool of able-bodied workers and increasing demand for care workers, who toil for low pay but are vital to support a growing cohort of older Americans.
“There was a work force crisis in the home care industry before Covid,” said Kevin Smith, chief executive of Best of Care in Quincy, Mass., and president of the state industry association. “Covid really laid that bare and exacerbated the crisis.”
more families turning their backs on nursing homes, which were early hotbeds of coronavirus infections, Mr. Smith said, personal care aides and home health aides are in even shorter supply.
“The demand for services like ours has never been higher,” he said. “That’s never going back.”
And some of the changes brought about by the pandemic might create new transition opportunities that are not yet in the Brookings data. The accelerated shift to online shopping may be a dire development for retail workers, but it will probably fuel demand for warehouse workers and delivery truck drivers.
The coronavirus outbreak induced such an unusual recession that any predictions are risky. And yet, as Ms. Escobari of Brookings pointed out, the recovery may provide rare opportunities for those toiling for low wages.
“This time, people searching for jobs may have a lot of different options,” she said. “That is not typical.”
an ambitious proposal to cut carbon emissions, how will those who hope to succeed Chancellor Angela Merkel respond?
If only because of their sheer scale, analysts say, the floods are likely to play a significant role for voters when they go to the polls on Sept 26 to replace Ms. Merkel, who has led the country for 16 years.
The death toll in Germany climbed to at least 143 on Saturday, while the toll across the border in Belgium stood at 27, its national crisis center said. The count rose most sharply in Germany’s Ahrweiler district in Rhineland-Palatinate State, where the police said that more than 90 people had died. The authorities feared that number could yet grow.
In Germany, Europe’s largest economy and a country that prides itself on its sense of stability, the chaos wrought by nature was likely to reverberate for months, if not years.
But on Saturday, residents and rescue workers in flood-hit areas faced the more immediate and daunting task of clearing piles of debris, unclogging roads and salvaging some of the homes that had survived the deluge.
Hundreds of people remain unaccounted for, but officials have struggled to offer precise numbers.
Electricity and telephone services remain inaccessible in parts of Germany, and some roads are still impassable. That lack of access may account for the high tallies of those still considered missing. And some of those who are not accounted for could simply be away, on vacation or work assignment. In Belgium, police officers started knocking on doors to try to confirm the whereabouts of residents.
Still, officials said they expected to find additional victims.
Extreme downpours like the ones that hit Germany are one of the most visible signs that the climate is changing as a result of global warming from greenhouse gas emissions. Studies have shown a warmer atmosphere can hold more moisture, generating more rainfall.
Floods of this size have not been seen in 500 or even 1,000 years, according to meteorologists and German officials.
Rhineland-Palatinate was one of the two hardest-hit German states in the west, along with North Rhine-Westphalia. The Rhine River flows through the two regions, and the rain fell so rapidly that it engorged even small streams and tributaries not typically considered flood threats.
Germany’s president, Frank-Walter Steinmeier, traveled on Saturday to the town of Erftstadt, southwest of Cologne, where the flooding destroyed homes. Ms. Merkel planned to travel on Sunday to Schuld in Rhineland-Palatinate, which was badly hit, even as all of its 700 residents managed to survive.
There were scenes of devastation from all around Western Europe, the floods having caused damage from Switzerland to the Netherlands. But Germany was hardest hit.
Days before roiling waters tore through western Germany, a European weather agency had issued an extreme flood warning, as models showed that storms would send rivers surging to levels that had not been seen in hundreds of years.
The warnings, however, did little good.
Though Germany’s flood warning system, a network of sensors that measure river levels, functioned as it was supposed to, state and local officials said the amount of rain was unlike anything they had ever seen, causing even small streams and rivers to flood their banks.
Survivors and officials said many areas were caught unprepared as normally placid brooks and streams turned into torrents that swept away cars, houses and bridges. About 15,000 police officers, soldiers and emergency service workers have been deployed in Germany to help with the search and rescue.
Dr. Linda Speight, a hydrometeorologist at the University of Reading in Britain who studies how flooding occurs, blamed poor communication about the high risk posed by the flooding as contributing to the significant loss of life. “There should not have been so many deaths from this event,” she said.
Residents returning home, only to find their homes no longer there. Roads submerged by landslides. Loved ones still unaccounted for.
As the weather improved on Saturday and rescue workers searched for missing residents, many people in flood-hit areas of Germany were trying to re-establish some order amid the chaos and destruction.
Friends and relatives mobilized to help, maneuvering around blocked roads and washed-out bridges. Crushed cars and mounds of ruined goods were carted away, or piled by the side of muddied, cracked roads.
Many expressed amazement at how so much could have been destroyed so quickly. For Lisa Knopp, 19, who was helping to empty the flood-ruined basement of her grandmother’s home in Sinzig, a small town between the Rhine and Ahr rivers, the scenes of destruction “will stay with me a long time.”
Kim Falkenstein said her mother lost her home in Ahrweiler, one of the hardest-hit spots. Ms. Falkenstein, who was born in Ahrweiler and now lives in New York, said several friends had also lost their homes, and a classmate had died.
“I am heartbroken,” she said.
“Seeing my city being destroyed, people who I am close with losing their existence, and knowing I will never return to something I once called home,” Ms. Falkenstein said, “gives me goose bumps.”
In a country that is among Europe’s most prosperous, where orderliness is highly prized, many Germans were unnerved by the helplessness wrought by nature.
Bertrand Adams, a local official in Trier-Ehrang, a town in western Germany, stared in disbelief at the swirling waters only now receding from his community.
“It is beyond anything that could ever be imagined,” he told ZDF television. “We have a very good flood protection system that we developed only five years ago. We were so certain that nothing can go wrong.”
Daniela Schmitz, who has a ranch in Erftstadt, a town southwest of Cologne, was relieved that her property was not destroyed by the floods and that her horses had been evacuated. Others, she said, weren’t that fortunate.
“We were warned early enough — other stables are not doing so well,” she wrote in a WhatsApp message. “Many animals have drowned, entire stalls destroyed, and feed is becoming scarce. The conditions are really catastrophic in many places.”
On Saturday, German television channels carried wall-to-wall coverage of the flooding, as rescue workers continued searching for those who had been trapped by rising waters, with 143 confirmed dead in Germany and hundreds still missing.
As the official response picked up speed on Saturday, electricity, water and internet coverage were slowly being restored. Hundreds of police, fire and emergency vehicles crammed the roads into the most afflicted areas of Rhine-Palatinate and North Rhine-Westphalia.
The coronavirus pandemic and a huge explosion in the port of Beirut last August further devastated the economy.
Estimates put the central bank’s losses at $50 billion to $60 billion. The International Monetary Fund has offered assistance, but Lebanese officials accuse Mr. Salameh of blocking an audit sought by the United States and other countries that would unlock I.M.F. aid, as well as a separate investigation into alleged fraud at the central bank.
Most Lebanese have said goodbye to whatever savings they had while the currency has crashed, reducing salaries once worth $1,000 a month to about $80. The central bank is burning through its reserves, spending about $500 million per month to subsidize imports of fuel, medicine and grain.
“Lebanon has been living on borrowed time, and now the chickens have come home to roost,” said Toufic Gaspard, a Lebanese economist and former adviser at the I.M.F. “The whole banking system has collapsed, and we have become a cash economy.”
The crash has soured many Lebanese on their once celebrated central banker.
“I can’t say anything good about Riad Salameh,” said Toufic Khoueiri, a co-owner of a popular kebab restaurant, while having lunch with a friend in Beirut. “Our money is not stuck in the banks, but simply stolen.”
His friend, Roger Tanios, a lawyer, said he had once admired Mr. Salameh for keeping Lebanon financially stable but had changed his mind.
Mr. Salameh, he said, had gone spectacularly off course.
“Every country has its mafia,” Mr. Tanios said. “In Lebanon, the mafia has its country.”
Ben Hubbard reported from Beirut, and Liz Alderman from Paris. Hwaida Saad contributed reporting from Beirut, and Asmaa al-Omar from Istanbul.
IBM insists that its revised A.I. strategy — a pared-down, less world-changing ambition — is working. The job of reviving growth was handed to Arvind Krishna, a computer scientist who became chief executive last year, after leading the recent overhaul of IBM’s cloud and A.I. businesses.
But the grand visions of the past are gone. Today, instead of being a shorthand for technological prowess, Watson stands out as a sobering example of the pitfalls of technological hype and hubris around A.I.
The march of artificial intelligence through the mainstream economy, it turns out, will be more step-by-step evolution than cataclysmic revolution.
A New Wave to Ride
Time and again during its 110-year history, IBM has ushered in new technology and sold it to corporations. The company so dominated the market for mainframe computers that it was the target of a federal antitrust case. PC sales really took off after IBM entered the market in 1981, endorsing the small machines as essential tools in corporate offices. In the 1990s, IBM helped its traditional corporate customers adapt to the internet.
IBM executives came to see A.I. as the next wave to ride.
Mr. Ferrucci first pitched the idea of Watson to his bosses at IBM’s research labs in 2006. He thought building a computer to tackle a question-answer game could push science ahead in the A.I. field known as natural language processing, in which scientists program computers to recognize and analyze words. Another research goal was to advance techniques for automated question answering.
After overcoming initial skepticism, Mr. Ferrucci assembled a team of scientists — eventually more than two dozen — who worked out of the company’s lab in Yorktown Heights, N.Y., about 20 miles north of IBM’s headquarters in Armonk.
The Watson they built was a room-size supercomputer with thousands of processors running millions of lines of code. Its storage disks were filled with digitized reference works, Wikipedia entries and electronic books. Computing intelligence is a brute force affair, and the hulking machine required 85,000 watts of power. The human brain, by contrast, runs on the equivalent of 20 watts.
The Fed targets 2 percent annual price gains on average over time, a goal it defines using a different index. Still, the C.P.I. is closely watched because it comes out more rapidly than the Fed’s preferred gauge and it feeds into the favored number, which has also accelerated.
Republicans have pointed to rapid price gains as a sign of the Biden administration’s economic mismanagement, and an argument against the kind of additional spending that President Biden has called for as part of his $4 trillion economic agenda, including investments to fight climate change, bolster education and improve child care.
“Bidenflation is growing faster than paychecks, wiping out workers’ wage gains, and leaving American families behind,” Republicans on the House Ways and Means Committee said in a news release following the data report.
The talking point has proved potent because the recent strength in inflation has outstripped the pickup that many officials had expected. In Mr. Biden’s official budget request, released this spring, officials forecast an inflation rate that stayed near historical averages for 2021 and never rose past 2.3 percent a year over the course of a decade. Administration officials have now begun to acknowledge that higher inflation could stay with the economy for a year or two.
The possibility that inflation will not fade as quickly or as much as expected is becoming a defining economic risk of the era. Signs that strong demand could bolster prices, at least for a time, abound. A New York Fed survey out Monday showed that consumers expect to keep spending robustly in the year ahead.
Some members of the business community see price pressures lasting.
Hugh Johnston, the chief financial officer of PepsiCo, told analysts on Tuesday that the company was anticipating more inflationary pressures via higher costs for raw materials, labor and freight. “Are we going to be pricing to deal with it? We certainly are,” he said.
Jamie Dimon, JPMorgan Chase’s chief executive, told analysts on a conference call on Monday that “it’ll be a little bit worse than the Fed thinks. I don’t think it’s all going to be temporary. But that doesn’t matter if we have very strong growth.”
Anxieties over a lag in hiring lifted on Friday as the government reported that employers added 850,000 workers in June, the largest monthly gain since last summer.
Wages jumped for the third month in a row, a sign that employers are trying to attract applicants with higher pay and that workers are gaining bargaining power.
Rising Covid-19 vaccination rates and a growing appetite for travel, dining out, celebrations and entertainment gave a particular boost to leisure and hospitality businesses. The biggest chunk of June’s gains — 343,000 — could be found there.
accelerated rate of early retirements means that some of those workers will never come back.
“Today there are more job openings than before the pandemic and fewer people in the labor force,” said Becky Frankiewicz, president of the staffing company ManpowerGroup North America. “The single defining challenge for employers is enticing American workers back to the work force.”
The report follows several promising economic developments this week. Consumer confidence, which surged in June, is at its highest point since the pandemic’s onset last year. Stocks closed out the first half of the year at record highs. And the Congressional Budget Office said Thursday that the economy was on track to recover all the jobs lost in the pandemic by the middle of next year.
But economists cautioned against trying to divine the complex currents crisscrossing the labor market from a single month’s data, particularly given how much the pandemic has disrupted employment patterns.
may reflect smaller-than-expected layoffs rather than big gains. Over a longer period, employment in both public and private education remains significantly below its prepandemic level.
remarks from the White House.
The June figures are unlikely to allay the concerns of small-business owners and managers who complain about the difficulty finding workers. Nearly half report that they cannot fill openings, according to a recent survey by the National Federation of Independent Business.
The competition for workers has pushed up wages. Average hourly earnings climbed 3.6 percent in the year through June and 0.3 percent over the month. Low-wage workers seem to be the biggest beneficiaries of the bump in pay.
Ms. Frankiewicz of ManpowerGroup said the rise of “superemployers” like Amazon and Walmart was making it even more difficult for small and medium-size businesses to attract workers. In the summer of 2019, the top 25 employers had 10 percent of the open jobs, she said, while “today 10 employers do.”
moved to end distribution of federal pandemic-related jobless benefits even though they are funded until September, arguing that the assistance — including a $300 weekly supplement — was discouraging people from returning to work.
The latest jobs report did not reflect the cutoff’s impact because the government surveys were completed before any states ended benefits.
Staffing firms said they had not seen a pickup in job searches or hiring in states that have since withdrawn from the federal jobless programs.
Indeed surveyed 5,000 people in and out of the labor force and found that child care responsibilities, health concerns, vaccination rates and a financial cushion — from savings or public assistance — had all affected the number looking for work. Many employers are desperate to hire, but only 10 percent of workers surveyed said they were urgently seeking a job.
And even among that group, 20 percent said they didn’t want to take a position immediately.
Aside from ever-present concerns about pay and benefits, workers are particularly interested in jobs that allow them to work remotely at least some of the time. In a survey of more than 1,200 people by the staffing company Randstad, roughly half said they preferred a flexible work arrangement that didn’t require them to be on site full time.
Some employers are getting creative with work arrangements in response, said Karen Fichuk, chief executive of Randstad North America. One employer changed the standard shift to match the bus schedule so employees could get to work more easily. Others adjusted hours to make it easier for parents with child care demands.
Health and safety concerns are also on the minds of workers whose jobs require face-to-face interactions, the survey found.
Black and Hispanic workers, who were disproportionately affected by the coronavirus and by job losses, are having trouble regaining their foothold. “The Black unemployment rate is still exceptionally high,” at 9.2 percent compared with 5.2 percent for white workers, said Michelle Holder, an economist at John Jay College in New York.
One factor in the elevated Black jobless rate is that the ranks of Black workers employed or seeking jobs grew sharply last month. But participation in the labor force remains lower than it was before the pandemic among all major racial and ethnic groups.
Professor Holder said some people were reluctant to rejoin the labor force because of the quality and the pay of the work available.
“We don’t have a shortage of people to work,” she said. “What we don’t have are decent jobs.”
Jeanna Smialek and Ben Casselman contributed reporting.