International
UK Markets Implode After Truss Unveils Historic Tax Cuts As Economy Slides Into Recession Amid Soaring Prices
UK Markets Implode After Truss Unveils Historic Tax Cuts As Economy Slides Into Recession Amid Soaring Prices
New UK Chancellor Kwasi Kwarteng…

New UK Chancellor Kwasi Kwarteng has stunned (read crashed) UK markets by making giant economic gamble with his 'mini-budget' to "turn the vicious cycle of stagnation into a virtuous cycle of growth" whose goal is to shock the UK economy back to life with a massive 45 billion pound tax cut - the largest since the 1970s - including slashing the 45% additional tax rate for the highest earners. Instead of stabilizing markets, as some maybe hoped in light of the relentless plunge in cable to the lowest level since 1985 - the announcement sparked mayhem instead as it promises even more inflation at a time when the UK is set to slide into a crippling stagflationary recession as prices soar, and tax cuts will only ensure even more inflation, just as Albert Edwards warned last night.
As note above, Kwarteng unveiled the most significant tax cuts since the 1970s, to be funded at a time when interest rates are soaring. He abandoned Boris Johnson's economic policies to increase taxes to pay for public services, while the Bank of England warned earlier this week the economy 'might already be in recession'.
Appointed by new PM Liz Truss, Kwarteng abolished the 45% additional income tax rate for those earning more than 150,000 pounds. Kwarteng also trimmed the basic rate of income tax to 19%. "This means that we will have one of the most competitive and progressive income tax systems in the world," he said.
The head of the Institute of Fiscal Studies described Kwarteng's fiscal plan as the "biggest tax-cutting event since 1972." Truss hopes tax cuts and increased government borrowing will stimulate the faltering economy as growth slows, households plunged into energy poverty and inflation at the highest in forty years.
In a statement to the Commons, he said:
"Growth is not as high as it needs to be, which has made it harder to pay for public services, requiring taxes to rise.
"This cycle of stagnation has led to the tax burden being forecast to reach the highest levels since the late 1940s.
"We are determined to break that cycle. We need a new approach for a new era focused on growth."
The only problem with Kwarteng's plan is that increasing government borrowing when the BoE raises interest rates to control inflation doesn't appear sound.
Markets reacted very negatively to increased government spending. Gilt yields plunged the most on record, and the pound tagged the $1.10 handle.
"This kind of move in markets is a reminder of the days of the bond vigilantes, who punished fiscal splurges in the aftermath of the financial crisis. There were some suggestions during the pandemic their time had passed, but today's moves suggest they are alive and well. The big shift in monetary policy in recent years may be to blame, with higher rates removing a major leg of support for markets and leaving them exposed to fiscal largess," Bloomberg's David Goodman noted.
Mayhem in markets was broad, sending the FTSE 100 Index down more than 1.5%...
... while cable plunged as low as 1.1052, down more than 200 pips overnight, and the lowest level since 1985!
In response, a non-plussed Kwarteng merely said "the markets will do what they will." We wonder if he will keep his cool after we hit parity and stocks crater another 50% from here.
Government
US Sent Billions in Funding to China, Russia For Cat Experiments, Wuhan Lab Research: Ernst
US Sent Billions in Funding to China, Russia For Cat Experiments, Wuhan Lab Research: Ernst
Authored by Mark Tapscott via The Epoch Times…

Authored by Mark Tapscott via The Epoch Times (emphasis ours),
Hundreds of millions of U.S. tax dollars went to recipients in China and Russia in recent years without being properly tracked by the federal government, including a grant that enabled a state-run Russian lab to test cats on treadmills, according to Sen. Joni Ernst (R-Iowa).
Ernst and her staff investigators, working with auditors at the Government Accountability Office (GAO) and the Congressional Research Service, as well as two nonprofit Washington watchdogs—Open The Books (OTB) and the White Coat Waste Project (WCWP)—discovered dozens of other grants that weren’t counted on the federal government’s USASpending.gov internet database.
While the total value of the uncounted grants found by the Ernst team is $1.3 billion, that amount is just the tip of the iceberg, the GAO reported.
Among the newly discovered grants is $4.2 million to China’s infamous Wuhan Institute of Virology (WIV) “to conduct dangerous experiments on bat coronaviruses and transgenic mice,” according to a May 31 Ernst statement provided to The Epoch Times.
The $4.2 million exposed by Ernst is in addition to previously reported funding to the WIV for extensive gain-of-function research by Chinese scientists, much of it funded in whole or part prior to the COVID-19 pandemic by National Institutes for Health (NIH) grants channeled through the EcoHealth Alliance medical research nonprofit.
The NIH has awarded seven grants totaling more than $4.1 million to EcoHealth to study various aspects of SARS, MERS, and other coronavirus diseases.
Buying Chinese Puppy Parts
As part of another U.S.-funded grant, hearts and other organs from 425 dogs in China were purchased for medical research.
“These countryside dogs in China are part of the farmer’s household; they were mainly used for guarding. Their diet includes boiled rice, discarded raw food animal tissues, and whatever dogs can forage. These dogs were sold for food,” an NIH study uncovered by the Ernst researchers reads.
Other previously unreported grants exposed by the Ernst team include $1.6 million to Chinese companies from the federal government’s National School Lunch Program and $4.7 million for health insurance from a Russian company that was sanctioned by the United States in 2022 as a result of the invasion of Ukraine.
“It’s gravely concerning that Washington’s reckless spending has reached the point where nobody really knows where all tax dollars are going,” Ernst separately told The Epoch Times. “But I have the receipts, and I’m shining a light on this, so bureaucrats can no longer cover up their tracks, and taxpayers can know exactly what their hard-earned dollars are funding.”
The problem is that federal officials don’t rigorously track sub-awards made by initial grant recipients, according to the Iowa Republican. Such sub-awards are covered by a multitude of federal regulations that stipulate many conditions to ensure that the tax dollars are appropriately spent.
The GAO said in an April report that “limitations in sub-award data is a government-wide issue and not unique to U.S. funding to entities in China.”
“GAO is currently examining the state of federal government-wide sub-award data as part of a separate review,” the report reads.

The Eco-Health sub-awards to WIV illustrate the problem.
“Despite being required by law to make these receipts available to the public on the USAspending.gov website, EcoHealth tried to cover its tracks by intentionally not disclosing the amounts of taxpayer money being paid to WIV, which went unnoticed for years,” Ernst said in the statement.
“I was able to determine that more than $490 million of taxpayer money was paid to organizations in China [in] the last five years. That’s ten times more than GAO’s estimate! Over $870 million was paid to entities in Russia during the same period!
“Together that adds up to more than $1.3 billion paid to our adversaries. But again, these numbers still do not represent the total dollar amounts paid to institutions in China or Russia since those numbers are not tracked and the information that is being collected is incomplete.”
Adam Andrzejewski, founder and chairman of OTB, told The Epoch Times, “When following the money at the state and local level, the real corruption exists in the subcontractor payments. At the federal level, the existing system doesn’t even track many of those recipients.
“Without better reporting, agencies and appropriators don’t truly understand how tax dollars were used. We now know that taxpayer dollars are traded further downstream than originally realized with third- and fourth-tier recipients. These transactions need scrutiny. Requiring recipients to account for where and how they actually spend each dollar creates a record far better than agencies are capable of generating.”
Read more here...
Spread & Containment
COVID-19 Testing Resumes In Beijing, Shandong, As Reinfection Cases Surge
COVID-19 Testing Resumes In Beijing, Shandong, As Reinfection Cases Surge
Authored by Alex Wu via The Epoch Times,
China has resumed COVID-19…

Authored by Alex Wu via The Epoch Times,
China has resumed COVID-19 PCR testing in Beijing and Shandong Province amid rising re-infections, while the regime’s top health advisers have warned of a new wave of mass infections.
Since May 29, mainland netizens have posted on Chinese social media platforms that PCR test kiosks in Beijing are quietly back in business.
Mainland media “City Interactive,” a subsidiary of Zhejiang “City Express,” reported on May 30 that one of the PCR testing booths that netizens posted about was in Beijing’s Xicheng District, where the central government and the Beijing municipal government are located.
The staff of that testing kiosk said that the PCR test there has never stopped, reported “City Interactive”, without being clear how long it had been open.
“We have been doing nucleic acid testing in Xicheng District, but I’m not sure about other districts in Beijing,” a staff member said.
The staff member said the laboratory she works for is mainly responsible for nucleic acid testing within Xicheng District. Currently, there are more than ten testing points outdoors, and one person is on duty for each booth from 9:00 am to 5:00 pm.
Residents get swabbed during mass COVID-19 testing in the Chaoyang District in Beijing on June 14, 2022. (Andy Wong/AP Photo)
A testing kiosk in Chaoyang District, Beijing’s central business district, has been operating since March, reported “City Interactive.” The testing booth staff said it is in the health center near Jinsong Middle Street.
Ms. Wang, a Beijing resident, told The Epoch Times on May 28 that some people have taken the PRC test while others have chosen not to.
She said many people around her, including her child, have already re-infected twice.
“This time, the symptoms seem to include a high fever and then sore throat, very painful,” she said.
“Most people are just resting at home now. Seeing a doctor is very expensive, and now many medicines are paid for by ourselves.”
Gao Yu, a former senior media person in Beijing, confirmed what Wang said. She told The Epoch Times that the relatives around her have been re-infected two or three times, and most are just resting it off at home.
Shandong Resumes Testing
PCR testing booths in Qingdao City, Shandong Province, have also reopened.
A “Peninsula Metropolis Daily” report included a screenshot of an online notice posted by the Laoshan District Health Bureau in Qingdao, which announced that from May 29, the district will conduct COVID-19 PCR testing for “all people who are willing.”
It also listed the working hours of the testing sites, from 7:00 am to 4:00 pm, seven days a week.
Another mainland Chinese media, “Xinmin Evening News,” reported on May 31 that the staff in the district bureau confirmed that the testing has resumed and is for free.
Next Wave
Zhong Nanshan, China’s top respiratory disease specialist, predicted on May 22 that a new wave of COVID-19 infections in China will likely peak in late June when weekly cases could reach 65 million. Then, one Omicron-infected patient will be able to infect more than 30 people, Zhong said, adding that the infection is difficult to prevent.
A security personnel in a protective suit keeps watch as medical workers attend to patients at the fever department of Tongji Hospital, a major facility for COVID-19 patients in Wuhan, Hubei Province, China, Jan. 1, 2023. (Staff/Reuters)
Chinese citizens across the country have said on social media that infections have been swelling since March.
Zhong also said there had been a small peak in infections at the end of April and early May.
Most COVID-19 infections in mainland China are currently caused by the XBB series mutant strains of Omicron. Among the locally transmitted cases, the percentage of XBB series variants increased to 83.6 percent in early May from 0.2 percent in February.
Zhang Wenhong, China’s top virologist and director of China’s National Center for Infectious Diseases, also warned in late April at a conference that COVID-19 infections would reoccur after six months when immunity gained from prior infections has worn out.
International
Florida ‘freakishness’: why the sunshine state might have lost its appeal
Florida’s image as a safe sun and theme park destination may be threatened by recent political divisions and gun crime.

Florida is known worldwide for its beaches, resorts and theme parks, but has recently made headlines for a different reason. The state has been rocked by political controversies, bitter debates and fatal shootings at odds with its previously laid back holiday destination image.
In his 1947 book, Inside USA, writer John Gunther described Florida’s “freakishness in everything from architecture to social behaviour unmatched in any American state”. If Gunther had been writing today, he might be just as judgemental.
Florida’s recent political turmoil can be attributed to some highly contentious policies. The state has witnessed heated debates and legislative battles on issues including abortion, gun control, education, LGBTQ+ rights and voting rights.
Florida has been derided as “the worst state” in which to live, one of the worst in which to be unemployed or a student, and not a good place to die.
Even Donald Trump, who moved to his Florida Mar-a-Lago home during his presidency, has called it “among the worst states” to live in or retire to. This was an attack on Florida governor Ron DeSantis, who is also running for the Republican presidential nomination.
What was once considered by many to be a purple state – one that could either be Republican or Democrat – is now fiercely Republican. In recent years, the divide between those of different political beliefs has become toxic.
Importance of international image
International tourism and trade is huge business for Florida. In 2022, more than 1.1 million people visited Florida from the UK, the second largest group of international visitors on an annual basis. The UK is also Florida’s eighth largest trade partner with bilateral trade reaching $5.8 billion (£4.6 billion) in 2022. So state leaders might worry about tarnishing its image abroad.
Business leaders are already fretting about a fall in international visitor numbers linked to COVID and negative media coverage of the state. Around US$50 million was invested in marketing the state to tourists in 2023, this is expected to rise dramatically in 2024. The state’s ability to attract workers to keep its tourism and other industries going is weakening, reports suggest.
Heather DiGiacomo, chief of staff at the Florida Department of Juvenile Justice, told Florida senators that applications for jobs at state-run agencies were down and staff retention was down too. “These turnover rates … impacts the number of well-trained staff available to mentor new staff and puts additional strain on current staff without longer shifts in detention.”
Republican governor Ron DeSantis, now a presidential candidate, has been at the centre of Florida’s significant political divisions. The Republican state legislature’s controversial partisan bills, such as the recent redrawing of the electoral map to benefit the Republican party, was signed into law despite intense opposition.
While his conservative policies on taxes, regulation and immigration have won strong support from conservatives, critics argue that he prioritises partisan politics over the needs of all Floridians. His outspoken handling of the COVID pandemic sparked controversy, with accusations of downplaying the severity of the virus and prioritising economic interests.
Florida’s restrictive abortion laws have also attracted national and international attention. In April 2023, the state passed the foetal heartbeat bill, which prohibits abortions once a foetal heartbeat is detected, typically at around six weeks gestation. This law has faced significant backlash from reproductive rights advocates, who argue that many individuals may not even be aware of their pregnancy at such an early stage.
School shootings and gun laws
The Marjory Stoneman Douglas High School Public Safety Act was passed into Florida state law after the tragic Parkland school shooting in 2018, in which 17 people were killed. But it was controversial because it did not place restrictions on gun ownership or introduce background checks before gun purchases, but allowed schools to employ armed “guardians”. Critics argued that it fell short of addressing the root causes of gun violence in Florida.
There were seven mass shootings in Florida in the first two months of 2023. Despite this, the state has just passed a law that will come into effect on July 1 that will allow anyone who can legally own a gun in Florida to carry one without the need for a permit.
Florida’s partisan divide has been exacerbated by the introduction and passage of several laws that discriminate against the LGBTQ+ community. These laws cover areas including adoption, education, and transgender rights.
This year a massive LGBTQ event in a Florida theme park, which typically attracts 150,000 people, is taking out extra security measures, after new “don’t say gay” state laws were introduced in 2022. These rules ban teachers from discussing topics including sexual orientation. More generally, travel advisory warnings have been issued on the risks of travel to the state for LGBTQ+, African American and Latino people. A recent federal ruling overturned municipal bans on conversion therapy.
Although the “don’t say gay” bill was originally only aimed at third grade students and under, the bill has since been extended by Florida’s Board of Education to apply to all school pupils.
DeSantis has also become embroiled in a long legal and political battle with the Walt Disney Company, a major state employer, over the “don’t say gay” legislation. Disney recently announced it was cancelling a US$1 billion office complex project in the state.
Bills that restrict transgender students’ participation in school sports teams consistent with their gender identity have also sparked heated debate.
Meanwhile, changes in voting laws brought in by the state, including stricter identification requirements and limitations on the drop boxes where voters can leave mail-in ballots, have been criticised for making it more difficult for some people to vote.
Florida’s recent political turmoil has thrust the state into the national, and global, spotlight. Its deeply partisan divide, controversial policies and gun laws have created a toxic political climate, which has the ability to significantly damage the sunshine state’s appeal.
Dafydd Townley does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.
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