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    Defending Michigan’s Auto Industry, Whitmer Warns of Tariff Risks

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    Gov. Gretchen Whitmer addressed the Detroit Auto Show, saying that tariffs should not be used “to punish our closest trading partners,” like Canada.Gov. Gretchen Whitmer of Michigan, a leading Democrat from a critical battleground state, on Wednesday subtly warned against President-elect Donald J. Trump’s tariff threats targeting Canada, even as she stressed her broader willingness to work with him on the cusp of his second inauguration.Her speech, at the Detroit Auto Show, offered among the clearest examples yet of how Democrats from states that Mr. Trump carried are seeking to balance fresh overtures to the incoming president with their staunch opposition to some of his policy proposals.Speaking at a convention center just across the Detroit River from Windsor, Ont., Ms. Whitmer described strong cultural and industrial ties between the two cities.Using tariffs as punishment, she said, risks “damaging supply chains, slowing production lines and cutting jobs on both sides of the border.”Ms. Whitmer did not mention Mr. Trump by name as she broached the subject, but he has threatened to impose tariffs on imports from Canada if the country does not reduce the flow of migrants and fentanyl to the United States. The Ontario Premier Doug Ford has discussed retaliation, including threatening to disrupt the electricity supply from the province to the United States.“I am not opposed to tariffs outright, but we cannot treat them like a one-size-fits-all solution, and we certainly shouldn’t use them to punish our closest trading partners,” Ms. Whitmer said, arguing that such an approach could embolden China.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    German economy contracts 0.2% in 2024 in second consecutive annual slowdown

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    The German economy contracted by 0.2% in 2024, data from statistics office Destatis showed Wednesday.
    This is the country’s second consecutive yearly economic slowdown and was in line with expectations from economists polled by Reuters.
    Germany has been facing a series of economic struggles, including a long-standing housebuilding crisis and pressure on its autos industry.

    The skyscrapers of the Frankfurt skyline in the evening, with the Deutschherrn Bridge in the foreground.
    Frank Rumpenhorst | Picture Alliance | Getty Images

    The German economy contracted by 0.2% in 2024, in the country’s second consecutive yearly slowdown, data from statistics office Destatis showed Wednesday.
    The drop was in line with the expectations of economists polled by Reuters, according to LSEG data. The European Commission and a group of Germany’s leading economic institutes had both independently forecast a 0.1% dip in the German GDP in 2024.

    Ruth Brand, president of the German statistics agency, said that “cyclical and structural pressures” hindered stronger economic development.
    “These include increasing competition for the German export industry on key sales markets, high energy costs, an interest rate level that remains high, and an uncertain economic outlook,” she said in a statement.
    Destatis said that both the manufacturing and construction sectors had suffered in 2024, while the services sectors recorded growth over the period.
    The country has been dealing with a long-standing housebuilding crisis, which has been attributed to higher interest rates and construction costs. Several of Germany’s key industries, including the auto sector, have also been under pressure for some time. Carmakers have been struggling with the transition to electric vehicles, as well as competition from Chinese counterparts.
    The German stock index DAX was last higher after the data release, climbing by 0.47% at 10:24 a.m. London time after already having started the day in positive territory.

    Germany’s economy had already contracted by 0.3% in 2023.

    Fourth quarter

    Destatis on Wednesday also released an early first reading of the gross domestic product (GDP) in the fourth quarter, based on currently available information. The economy fell by 0.1% in the three months to end of December, compared with the previous quarter, when adjusted for price, seasonal and calendar variations. The regular first reading of Germany’s GDP for the fourth quarter will be released later this month, Destatis noted.
    Robin Winkler, chief Germany economist at Deutsche Bank, on Wednesday said that, while the annual GDP contraction should not be a surprise to anyone, the preliminary reading for the fourth quarter of 2024 was unexpected and worrisome.
    “If confirmed, it would mean that the German economy lost momentum again at the start of winter. The current political uncertainty in Berlin and Washington was likely an important factor,” he said in comments translated by CNBC.
    Looking ahead, German economic institute Ifo on Wednesday warned that unless economic policy reforms are introduced, the German economy would struggle to “break free from stagnation” in 2025, with the institution expecting “perceptible growth” of 0.4% over the period in this scenario.
    “If no countermeasures are taken, the ifo researchers fear that manufacturing companies will continue to relocate production and investments abroad,” the institute said in a statement. “Productivity growth would also remain weak, as value added and employment in highly productive industries would be replaced by value added in service sectors with low productivity growth.”
    If “the right” policies are introduced, investing and working in Germany could nevertheless become a more viable option again, and the economy could expand by as much as 1%, Ifo added. More

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    Economic Toll of Los Angeles Fires Goes Far Beyond Destroyed Homes

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    The ongoing disaster will affect residents’ health, local industries, public budgets and the cost of housing for years to come.After decades of mounting damage from climate-fueled natural disasters, researchers have compiled many misery-filled data sets that trace the economic fallout over weeks, months and years.The fires still burning in Los Angeles are sure to rank among America’s most expensive — but there is no perfect analogue for them, making it difficult to forecast the ultimate cost.The main reason is that wildfires have typically burned in more rural locations, consuming fewer structures and attacking smaller metropolitan areas. The Los Angeles conflagration is more akin to a storm that hits a major coastal city, like Houston or New Orleans, causing major disruption for millions of people and businesses.“It looks a lot more like the humanitarian situation from a flood or a hurricane than a wildfire that people are watching in the hills,” said Amir Jina, an assistant professor at the University of Chicago’s Harris School of Public Policy, who has studied the economic impact of climate change.On the other hand, several mitigating factors could lead to lower costs and a stronger rebound relative to other places. The cinema capital’s wealth and industrial diversity, along with other natural advantages from geography and weather, may allow Los Angeles to stave off a worst-case scenario.Estimating the likely economic losses is tricky at this stage. The weather data company AccuWeather has offered a figure of $250 billion to $275 billion, though a Goldman Sachs report said it found the estimate high. (Declining to provide a breakdown because its methodology is “proprietary,” AccuWeather said it considered many factors including long-run health impacts as well as short-term losses in the value of public companies exposed to the disaster.)We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More