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Hello and welcome to World Business Report on the BBC World Service.
I'm Will Bain. Great as always to have your company on the programme.
It's going to be a busy programme today because is coming up.
President Trump's tax and spend bill is finally ready for him to sign.
But is it really as big and beautiful as the president stresses ahead of the US Independence Day fireworks in Washington, D .C.
this July 4th? We'll hear about why some elements of the bill could have ramifications for companies both at home and abroad.
Also today, we hear about a scheme trying to get prison leavers reintegrated into the workforce.
Absolutely everything.
I'm I'm getting my family back and that means more to me than anything.
I've wasted 20 years of my life and if I could meet my younger self now, I would give him a smack on the head.
Yeah, more on that really interesting project here in the UK a little bit later on.
And one of the world's biggest bands, or certainly one of the biggest ones of the 90s, are back.
Oasis return 16 years after separating this Friday night in the Welsh capital, Cardiff.
and as the rock band Black Sabbath return to this weekend is nostalgia the way to make touring make financial sense now we'll hear more on that a little bit later on here on World Business Report let's start though in the US because President Trump's key bill on tax and spending is due in front of him to sign at some point before the end of this Friday his so -called big beautiful bill promises to make savings through making cuts to food benefits and health care rolling back tax breaks for things like clean energy projects as well.
It also is due to deliver on two of the president's key campaign promises, making his 2017 personal tax cuts permanent and lifting taxes on tips, overtime and social security recipients, as well as including spending on defence and border security as well.
The Independent Congressional Budget Office, though, estimates the bill could could add $3 .3 trillion to the federal deficit over the next 10 years and leave millions without health coverage, a forecast that the White House disputes.
Big, beautiful, certainly controversial too.
We'll pick through some of the more in -depth elements in just a moment, particularly around energy and electric vehicles.
But first of all, Randeep Sumel is going to be with us throughout the programme today on World Business Report, Randeep's fund manager at Energy Investments here in London.
Randeep, welcome to World Business Report.
Paul. Great to have you back on the program.
Thank you. Nice to be here.
Is that the biggest element of this that from a market's perspective is being watched that sort of additional borrowing that could be totted up on the kind of US government's balance sheet and what that might mean?
It is. I mean, the new borrowing is actually marginal, like you mentioned, it's actually just a continuation of the tax cuts that President Trump put in place at the beginning of his first term and were continued by President Biden.
Now, there's some minor tax cuts that we've seen around over time and tips.
And he's tried to cut the spending back a little bit on Medicaid and, of course, trying to unwind President Biden's Infrastructure Inflation Reduction Act, which is around green energy and electric vehicles.
But the bigger concern is that the US debt keeps on rising, 35 trillion and rising, 800 billion a year just in interest payments.
So I think what we would have liked to have seen is just to try and address the absolute levels of spending and potentially increase some taxation to try and bring that into balance yeah now the administration are suggesting that this will help the economy grow and therefore it will pay for itself but at the moment that's yet to be seen yeah we'll get some more big picture thoughts from randy in a moment and whether there's been some sort of sector specific impact on financial markets as well but as he mentions it does roll back a number of those subsidies that were in place from the biden administration for things
like electric vehicles and solar panels in particular and it re -emphasizes, I guess, a stressing on things like liquid -fired natural gas and the oil sector in the US.
Energy commentator Michael Liebrecht joins us.
Michael is also the host of the Cleaning Up podcast. Michael, welcome back to World Business Report.
Thank you very much for having me, Will.
Always great to have you on the program.
Just tell us what is changing and what has been rolled back through this sort of mammoth session for this enormous bill?
Bill? Well, so if you go back a couple of years, everybody was tremendously excited in the energy space because there was the Inflation Reduction Act, which was passed under President Biden, which really got the US back into the game, which China was running away with in terms of all of the clean energy technologies.
So wind, solar, batteries, electric vehicles, pretty much And all of the supply chain, all of the minerals that go into those, all of that is a large chunk of that is now gone.
And beyond that, almost vindictive amounts of sort of policy interventions on electric vehicles, wind and solar, the cheapest forms of electricity that most of the utilities and states in the US actually want to install.
all. So it is a handbrake turn.
And for the energy sector, very much a handbrake turn for the worse, unless you're in fossil fuels.
Can you pick out an example of where something's got more onerous in one of those sectors and give people a bit of an example?
Well, so there are, for instance, tax credits across the energy sector in the US.
And they've They've been contentious, frankly, for decades around wind and solar.
So they're being phased out more quickly, which means only those who are building projects now or in the very, very near future can sort of wrap up their work.
Right. So there's no kind of encouragement for sort of a pipeline of those projects anymore.
No, exactly. And, you know, there are American manufacturers.
Don't forget, because of this Inflation Reduction Act a couple of years ago, a lot of companies have committed a lot of money.
You also have a company like General Electric, GE, that is one of the world's leading manufacturers of wind turbines.
So that's one example.
Another example would be electric vehicles, where you've got a nascent industry, a growing industry.
The U .S. is pretty far behind, very far behind China, even, in fact, behind Europe.
up and so there was a set of measures to try to help the US to catch up well they're being phased out and presumably the rationale from the Trump administration's perspective Michael is that it protects those legacy if you like US industries that are there whether they be in fossil fuel power or gas and diesel cars for example can it do that with the pace that China is moving moving in the opposite direction around these newer technologies?
Well, I think you've got to differentiate really between LNG, so the gas industry and pretty much everything else, where obviously the US is highly competitive in gas and President Trump wants to use gas as an instrument of foreign policy going around the world, sort of offering people gas as an incentive to do whatever he wants them to do.
But other than that, when you look at the US car It is now wholly uncompetitive.
It's making cars that nobody around the world really wants to buy.
And the same with the coal industry, wholly uncompetitive.
And the coal industry gets tax credits in this new, big, beautiful bill.
So from your perspective, is this just seeded victory to China in a load of those areas?
Can the US ever really compete on something like electric cars, for example, with China?
you know? Well, I think you should never write the U S off.
It's an incredible economy with incredible innovation and technologies, but China is already, I would say, you know, it was already getting very close to being over the horizon on these new energy technologies.
So, you know, if you are, um, in Pakistan or in Thailand or in Malaysia, or even frankly in Australia or or europe and you want to buy the cheapest form of clean energy cheaper than than the fossil energy you want to buy some solar panels some batteries you want a cheap electric car um and i suppose the question now is well where'd you can can you be weaned off that by the promise of some lng and i just don't think you can really interesting going to be a debate that continues to rage i think isn't it um michael thanks so much for your time michael liebrich the host of the cleaning up a podcast
energy commentator as well randy give us a quick thought there any movement in some of those sort of legacy car brands the fords etc who are listed on the us stock market as a result of this we're going to start sending letters out to various countries starting tomorrow we'll probably have 10 or 12 go out tomorrow well as you might have guessed that wasn't randy there we'll get his thoughts on the the big beautiful bill perhaps at the end of this as well because that was president trump talking about something else that's happening this fourth of july he's been Been really trying to pack it in,
hasn't he, before the public holiday, the three day weekend here in the United States.
Markets closed, for example, there on Friday, as well as a result because those letters he was talking about in that clip are about tariffs.
Those reciprocal tariffs, as he calls them.
You might remember the deadline is the 9th of July for countries to make a deal with the US or face those higher tariffs.
Those ones where you saw the president standing in the White House garden with a big board of numbers there going up and down as well.
One of the U .S.' biggest trading partners is the European Union, not yet reached a deal with the U .S. And the EU's Commission President, Ursula von der Leyen, says they are ready for an agreement, but a detailed one might not be possible.
We are aiming at the 9th of July.
It's a huge task because we have the largest trade volume globally between the European Union and the United States, 1 .5 trillion euros.
Very complex and a huge quantity.
And, indeed, what we are aiming at is an agreement in principle.
Because, I mean, such a volume in 90 days, an agreement in detail, impossible.
Well, one country that has secured a deal is Vietnam.
For a sense of how important that deal was for businesses in the country, we heard from Hao Le, who owns Vietnamese company SHDC Electronics, sells more than $2 million worth of phone and computer accessories every month to the United States.
Chum's new tariff plan on Vietnam matters a lot to my company.
To be honest, it's about survival.
If the tax is 20%, we can still manage, even though it's not what we are hoping for.
We are also watching how the US deals with another company Germany like India, Indonesia, Thailand, Malaysia and the Philippines.
If the tax rates are the same or higher than us, we expect to get more orders from the U .S. Well, the man with the job to pour over the letters, pour over that board, bring us up to speed with everything that may or may not be struck between now and the 9th of July is our reporter Jonathan Josephs who joins us alongside Ran Deep as well.
Jonathan, great to have you back on the program.
Worth going backwards a little bit here these reciprocal tariffs the reasons for them why the president's fixated on them and this deadline what do we what do we know who's kind of struck deals already yeah well we know well there's been two dead there's been two deals struck the united kingdom and vietnam that vietnam deal that we were just hearing about that was only struck on wednesday that was announced by president trump but we still don't have many details about exactly what it entails and i think detail is quite an important word here and that's why we don't really know exactly what's going
on until President Trump or the other countries announce some kind of a deal.
There's lots of trade negotiations still going on.
Many countries are still taking this to the wire.
We know, for instance, that South Korea's trade minister is in Washington this weekend, and he's already said that he may well ask for an extension of that July 9th deadline, because it shows the complexity of doing trade deals.
These things normally take many, many years to agree and president trump is trying to rush through dozens and dozens of them in a matter of weeks which is quite some feat to accomplish how far he'll get remains to be seen randy it's that complexity isn't it of global supply chain so it's got you and investors investor colleagues around the world so nervous about what impact it means for companies in all sorts of sectors it has and that's why we saw the huge sell -off uh at the beginning of the last last quarter on Liberation Day because the complexities around supply chains are just very hard to
untangle. And if companies do want to move production, it's not so easy to do.
So the more of these trade deals that can be signed before the 9th of July and the more of these tariffs that can be taken out, the better for markets overall.
Well, to that point, Jonathan, what are his expectations then?
What's the president's expectations and what's your expert expectation management, I guess, as well for what can and can't be done by the 9th?
Well, as ever, President Trump keeps us all guessing, doesn't he?
And I think, you know, as you said, it's a public holiday in the United States.
The markets are closed.
It's Independence Day.
So the question is, does that mean President Trump feels independence from any potentially negative market reaction, as we were just hearing?
Or does he go ahead and does he go ahead to announce these letters are being sent and that tariffs are going to be imposed?
Or is he going to have a rest like millions of other Americans?
Now, I've been closely monitoring his social media feeds, and he has been quite active in the last few minutes, but I haven't seen anything yet about tariffs on trade deals.
So, you know, the question is, is he running out of patience with these negotiators that are queuing up to see his team in Washington?
And is he going to just issue these unilateral decisions about what tariffs he wants to impose?
I mean, remember, this is all about President Trump trying to to rebalance American trade.
He is hugely unhappy, as he has been for many years, about the American trade deficit.
Last year, it was $1 .2 trillion.
That's a record amount.
And that means that America bought $1 .2 trillion more goods from other countries than it sold to them.
And President Trump takes a rather simplified view of this is costing America money, that it is sending its wealth abroad.
But he's also used tariffs to try and create some leverage on issues like fentanyl, illegal drugs coming into America from he says places like China and Mexico and President Trump has also been unhappy with the way American companies are treated in those other countries he wants them to have better access to those markets he says that other countries companies have better access to the US than the other way around and also he sees it as a way of raising money for the American government as we you heard earlier in the program that he's got this hugely the expensive tax bill that it's gone through and he
needs more money to come into US treasury coffers.
Randy, as Jonathan was saying, concern about jobs from the President's team, but a lot of those big American multinationals, the stock market listed ones that import goods and people from all around the world, have been warning, haven't they, that this might add expense for customers, for consumers?
Yes, I mean, the hope, of course, is that they can try and get the tariff stamp.
But if they don't, the US is also not the cheapest place to produce.
So therefore, by onshoring a lot of the manufacturing, it will increase domestic prices.
We haven't seen that yet, but it is likely.
The one thing I would also add is we talk a lot about goods.
And yes, the US is a net importer of good.
It is also a net exporter of services, technology, finance, finance banking you know it's made huge leaps in these areas and it's the world leader by some distance so while they are a net importer of good they are an exporter of services and those aren't included in any of this and just spell that out as well because if that spills into part of the trade tensions if countries that they're debating with or can't find agreement with that is a way that those countries or blocks in the european union's case could respond right by putting restrictions on those service industries yeah it already has so france
has proposed the potential 10 % tax on technology companies affecting the lights of Google and Facebook.
And Trump has categorically said you need to remove these right now or we will not be signing a trade deal with you on goods.
It's going to be a busy weekend.
It's going to be a busy weekend for Jonathan Josephs watching all this.
I'm sure we'll have him back on the programme on Monday.
Randy staying with us for the rest of the programme.
You're listening to World Business Report on the BBC ABC World Service.
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That's odoo .com. Now, how to reintegrate offenders who've committed crimes so serious that they've spent time in prison back into our societies is a huge challenge right around the world, isn't it?
It's often hard to find work for someone with a criminal record. And as a result, that can impact their likelihood to reoffend as well.
Well, the BBC's Felicity Hanna has visited a residential centre in Preston in the north of England that's run by a charity called Recycling Lives.
It takes a small number of ex -offenders and gives them a place to stay, training, support to try and help get them back into the workforce.
Its re -offending rate, as a result, is massively below the UK's national average.
They provide accommodation to people like Matty, who is trying to rebuild his life after spending time in prison for offences including shoplifting and burglary.
he's volunteering in their workshop dismantling electronics until he can find a full -time job of his own obviously you know working on a bit of a tight deadline matty so we could do this during by the end of the week yeah i'll get it set up it'll be done it'll be done show me what you do it's a gas meter you scan it through and then you scan the serial cord and then as soon as you give the all clear and send them all for the dismantling it's worth mentioning that i can't We'll talk to everybody who's here because some of these people are coming out of prison on day release and they're going back
to prison in the evening, so we're not allowed to talk to them.
But there's plenty of other people we can chat to.
Yeah, we've got volunteers today, a bit of a dismantling.
OK, this looks satisfyingly smashy.
What are you about to do?
Basically taking these circuit boards out, the brass batteries and the screens.
So we've got a contract with British Gas, contract with Baxi, contract with Curry's.
Obviously, we go through their stock and send all the metals and stuff back to them and get paid a wage.
I'm Alistair Jetson, I'm the Chief Executive of Recycling Life Charity.
We have workshops in seven different prisons, recycling in TVs, computers, gas meters.
We have a community workshop.
The aim being to upskill men and women in those environments, give them some self -esteem and then help them on their journey again, back to employment, back to independent living and, crucially, not back to prison.
We pay up to £60 a week per person, which doesn't sound a lot, but it's three or four times more than you would get in another workshop.
They can keep 60 % of that cash to spend, and 40 % is put in a savings account.
We pay the prison, and the prison set up those accounts inside prison for them.
That then means that they've built up a pot of money through their own hard work.
It's not a handout.
Is it right that they should be able to make that money and save that money and spend that money in prison when the taxpayer is paying for all their costs and keeping them while they're inside?
I think so. At the end of the day, the government or the taxpayer that's paying those wages, we've taken that decision as a charity and social enterprise to pay it.
So it's our money that's being paid.
My strong view is that of the 85 ,000 people that are in prison, 99 % of them are going to be released at some point.
And then every offending rate, depending what you look at, average anywhere between 30 % and 50%, that means that nearly half of those people are going to go back to prison.
Now, when you work on a recycling lives programme, that drops to 5%.
So only 5 % of the people we work with go back to prison.
Hi, is it Naomi? Hi, yeah, it is.
Nice to meet you. Hello, I'm Fliss.
Good to meet you. I'm the community partnership and volunteer manager over at Our Food Where Else.
Naomi trained in a different part of the business, which redistributes food to charities and community groups.
She did so well that they kept her on And it's a completely different life for her So I've been in prison since I was a kid Basically I've done eight sentences The world's changed a bit now for ex -offenders But back then you was not getting a job if you'd been to prison No one ever said you can be something better than what you're doing And you can earn money in a different way But I can say the one thing it does is it makes you work 40 hours a week People who are not used to that kind of thing So when I got out and I started working this full -time job, I'd never had a full -time straight job.
How long have you been out?
I've been out four years this year.
And it's clearly going very well.
What are your ambitions?
What are your goals?
So, well, my first ambition was to become a manager.
I reached that. I was recently promoted.
Congratulations. Thank you.
So I don't know, really.
I suppose it's just to make sure that everyone gets the same opportunities that I had and gets the same start that I had from us and to make sure that keeps going and we keep going.
She's also set up a soup kitchen, which she'll be running tonight.
Matty's hoping that one day he'll be in a position to give something back too.
I want to be on Prison Workshop because I want to help people who've been in a similar situation to me.
What do you want people to know about what this financial security means to you?
Absolutely everything.
I'm getting my family back, I speak to my brother, I have a relationship with my nephew, I'm still trying to work on with my daughter, things I'm getting there.
And that means more to me than anything.
um i've wasted 20 year on my life that's and if i could meet my younger self now i would give him a smartphone that's the bbc's felicity hannah reporting there now let's round out today's world business report by going back to the 90s we don't have to stay in the 90s anymore actually because 16 years after their explosive split oasis the band that made their names through the 90s and into the 2000s led by their brothers liam and noel gallagher are reuniting for a sellout world tour that kicks off today in Cardiff Wales or Friday if you listen to us elsewhere around the world or on the podcast
top hits like Wonderwall Don't Look Back in Anger and Champagne Supernova as a result will be being belted out by 90 ,000 plus you would expect at the Principality Stadium there and while Liam Gallagher has insisted the tour is not about money in fact he says it's way down the list of reasons why they've got back together again there are press reports suggesting suggesting that each of the brothers could pocket as much as $70 million and the total tour could rake in more than £400 million, so in excess of half a billion dollars in ticket sales and key merchandise sales as well, as these fans were indulging
in in Cardiff a little earlier on Friday.
Got a collection of vinyls, that's for a friend who lives overseas so he's not going to be able to make the concerts.
And then a couple of T -shirts for myself, iron -on prints, a standard bucket hat and a mug and then the wife's convinced me to get a poster for the bottom of the stairs just under 300 pound i've just bought a poster but we had a good look around there's lots of different t -shirts and added ass things and many bucket hats but i think make the money while you can absolutely go for it while you've got it because you just don't know what's around the corner so no good for them make money while you can matt grimes is with us music industry expert matt uh we talk about a lot of big things on this program
big tech big farmer big bucket hat added to the list by the sound of those shoppers in cardiff there yeah hi there will how are you yeah good thanks how how important is the kind of merchandising side of all of this just before we kind of get into the tour itself sure well i think you know in terms of uh bands of the sort of caliber of oasis the revenue that's generated from merchandise is i would suggest for them an add -on to their already accumulated wealth But I think if we slightly separate that from what goes on in the remainder of the music industries, I think it would be fair to say with the closure
of many grassroots venues taking place now, there's been reported by the Music Venue Trust. And we know the streaming doesn't pay out huge sums of money to emerging or up and coming artists.
Merchandise actually plays a really, really important role in revenue streams for those artists that are sort of early or mid career.
career because it's the percentages of profit they can make on those far outweigh the money they can make from streaming so your music then becomes really a gateway to live performances and the ability for fans to buy merchandise i was going to say we kind of thought that was possibly the reason to do it on a business and economics program today is that the shift in music economics if you like that it's not about selling albums and records anymore even though that person was buying vinyl there at the start it is about selling out football stadiums and in american football stadiums around the world
yeah i mean i think i think there is still a place for some of those things i mean vinyl has made a resurgence recently but i think a lot of that is based around format i think people are starting to turn away a bit from the streaming services now there isn't that physical emotional connection with streamed music that you might get with a physical artifact and i think some of the biggest record sales are taking place amongst older generations where nostalgia is big money in the music business at the moment so people are are reconnecting with their youth perhaps by going out and buying reissues
of vinyl you know the big vinyl sales now on like record store day are generally reissues rather than the new product so i think there is a shift in the way that people consume and engage with and briefly you excited for it do you think it's worth it them getting back together after all this time um i mean i was never an oasis fan but i can i can see and i absolutely you know as a scholar of popular music I absolutely recognize the cultural phenomena that this has brought about.
I know Randy and I have put our money in our pockets for the dynamically priced tickets.
So I'll be buying him that Adidas tie up T -shirt to say thank you for his help on World Business Report today.
Big thanks to Matt Grimes as well.
And big thanks to our team, Neil and Ahmed and to Lexi, who's been in charge today.
And of course, to all of you for listening to World Business Report.
