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France and Germany are in a good position to drive forward some serious reforms of the EU and the eurozone. Angela Merkel’s fourth term as chancellor, combined with the election in May of Emmanuel Macron, should give the EU what it has been lacking: a strong Franco-German alliance to meet the various challenges the bloc faces — Brexit, the rise of populism and the migration crisis to name a few.
Philip Stephens muses in his column on whether this opportunity might be missed, thanks to some subtle but significant differences in each side’s perspective. He argues that the vivid colours of Mr Macron’s vision clash with the duller hues of the outlook in Berlin. The French leader’s proposals for a eurozone budget and finance minister, for example, will raise fears in Germany that it is another attempt to wring more money out of it.
Then there are differences in temperament. As Philip points out, Ms Merkel is not an instinctive European and nurtures a natural scepticism towards the EU. Mr Macron, on the other hand, is a very enthusiastic European and is full of enthusiasm for change. Politically, however, they do have something in common. Both have defeated the far right at the ballot box recently. That alone should provide a bond that allows them to seize this moment to make a lasting difference.
Blankfein’s tweets: Gillian Tett argues in her column that the Goldman Sachs CEO is the latest leader to realise the benefits of bypassing the press. It might be risky to be direct, personal and provocative on social media but she argues that Donald Trump has changed the communication game and business leaders have no choice but to change with it.
Panda diplomacy: our FT View editorial looks at China’s practice of “Panda diplomacy” and warns that this exercise of soft power comes at a cost. Although they might look like a friendly gift, China charges $1m a year for a pair of pandas and reserves the right to repatriate them.
Government in exile: Robert Shrimsley imagines what life is like in Brussels for Carles Puigdemont, the former Catalan leader who has fled Spain out of fears for his safety.
Best of the rest
How Putin could yet save Britain from Brexit — Mark Galeotti in The Guardian
While New York Mourns, the President Postures — New York Times editorial board
Catalonia Is Becoming Europe’s Problem — Yasmeen Serhan in The Atlantic
More woe for Theresa May but the culture of Carry On Westminster is over — Anne McElvoy in the London Evening Standard
What you’ve been saying
Ignore the siren call of implausible US growth— letter from Desmond Lachman in the US
“The basic weakness of Mr Laffer’s argument is that it is supported by rhetoric rather than by hard evidence. To be sure, he is correct in arguing that cutting taxes would improve incentives to work and to invest. However, to assert without a shred of evidence that this would approximately double the country’s potential economic growth rate would seem to be a large stretch.”
“You may have very limited understanding of project costs and when you ask leading questions to prepare your story you are given the standard answer by Indian business-man — oh it costs too much. It is a historical fact that the Indian businesses always cry poor in front of the government — always worried that if they look profitable some government officers will ask for more bribes. So discount the whinge of the Indian business scene. Using your numbers at Rs 2.44 per kW-hr (4 cents per kW-hr) it looks like the project is profitable by 1 cent per kW-hr. 25% profitability is huge given the low risk.”
Time for the humanists to take control of our futures— letter from Maj Gen Jonathan Shaw (Rtd) in Hampshire
“Sir, Anjana Ahuja’s column, ‘ Technology toils to make our intellect obsolete,’ on the perils of unfettered advances in artificial intelligence, reminds me of the useful and instructive distinction made on CNN by General Mike Hayden following the National Security Agency Prism scandal of 2013, which revealed how metadata was being shared by tech companies with governments. He said there were two types of humans — technologists and humanists. Technologists ask: ‘What can we do?’ Humanists ask: ‘What should we do?’”
Martin Wolf: Britain has to offer more money for a smooth Brexit
Even a one-off payment of €60bn would be only 2.5 per cent of UK GDP
Gillian Tett: Lloyd Blankfein takes Twitter lessons from Donald Trump
The Goldman Sachs CEO sees the value in being able to bypass the press
Instant Insight: Jay Powell as Fed pick may not be the non-event it seems
The new central bank chair’s expertise in regulation could be significant, writes John Authers
Robert Shrimsley: Catalonia calling for the leader of the government in exile
Carles Puigdemont finds there is much to be said for staying in Brussels
America still holds the aces in its poker game with China
The US has advantages over its challenger that will outlive the present administration
Instant Insight: Gavin Williamson’s audacious bid to represent the Tories’ future
The new defence secretary is lining himself up for a leadership bid, writes Sebastian Payne
Free Lunch: A policy for centrists who care about the left-behind
Protect workers and employment — by not protecting jobs
Philip Stephens: Europe’s choice — French ambition or German bean-counting
Berlin wanted a strong ally in Paris, but is now lukewarm on Macron’s reforms
The Big Read
The Big Read: Guggenheim faces allegations of self-dealing
An FT investigation reveals that the firm’s own compliance team raised concerns about favouritism