Sunday, July 18, 2021

Tesla's Cheap 94-Mile Model 3 Has Cost Canadian Taxpayers $115 Million

Never really intended for sale, it was produced to pull the Model 3's base price below a key tax credit threshold.

BY ROB STUMPF JULY 17, 2021

ROB STUMPF View Rob Stumpf's Articles
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Earlier this year, we told you about Tesla's ultra-low range Model 3 sold exclusively in Canada. The no-frills EV has only 94 miles (151 kilometers) of range and no Autopilot to boot. Thanks to these limitations, Tesla was able to price this particular example low enough to qualify for Canada's Incentives for Zero-Emission Vehicles (iZEV) program—and as an added bonus, qualify the higher-up Standard Range Plus model as well due to the program's unusual price cap system.

Unsurprisingly, it appears that the 94-mile range Model 3 isn't a big seller. New data obtained from Transport Canada by The Drive shows that just over one-half of a percent of drivers who purchased a Model 3 and received Canada's $5,000 iZEV credit actually sprung for the low-range variant. The workaround has cost the government of Canada—and its taxpayers—millions of dollars to subsidize the purchase price of the more expensive trim that would have otherwise not qualified for the incentive. About $115 million CAD, to be exact.


VIA TESLA


What Is the iZEV Credit, Anyway?

Canada's system is quite different than the United States' approach to a $7,500 post-sale federal tax credit. Essentially, the arrangement is a $5,000 credit used towards the purchase of a qualifying electric vehicle which is applied at the time of purchase—or a lesser amount if the vehicle is a plug-in hybrid or leased instead of purchased. Automakers submit an application to Canada's department of motor vehicles, called Transport Canada, for specific models to be considered for the iZEV program. Once the model is approved, buyers can begin utilizing the incentive at the time of purchase to reduce their out-of-pocket expenses.

The meat and potatoes: The car's base trim must be priced under $45,000 ($37,211 USD), but subsequent trims of the same vehicle must not exceed $55,000 ($45,481). This threshold means any trim of the same vehicle model can be considered for the credit as long as it's under that price cap.


VIA TRANSPORT CANADA


Tesla charges $52,990 for the Model 3 Standard Range Plus, however, buyers can opt to limit the vehicles to 94 miles (151 km) of range which drops the price down to $46,389. If you remove the $1,280 destination fee, the $100 air conditioning fee, and a $10 fee to the Ontario Motor Vehicle Industry Council, it brings the purchase price of the Model 3 SR+ to just $44,999—one dollar below the cut-off to qualify for the iZEV credit.

In this configuration, Tesla drops the "Plus" designation and just calls the vehicle Model 3 Standard Range—the same name as the previously-killed trim sold in the United States. However, the $35,000 (in U.S. dollars) Model 3 SR sold stateside was equipped with 220 miles of range. The Model 3 SR sold in Canada is priced at $44,999 CAD ($37,299 USD) and has just 94 miles of range.

VIA TESLA


This workaround means that buyers of the 263-mile Standard Range Plus variant can make use of the iZEV credit. Even more coincidental is that buyers can equip both Teslas with the 19-inch sport wheels and premium white interior to pay just $54,900 (before destination and other fees)—$100 less than the $55,000 cut-off.

Keep in mind that Tesla had previously canceled the Model Y Standard Range in the U.S. over concerns that its 250-mile range would be "unacceptably low."




By the Numbers


Last year, the Canadian Taxpayers Federation obtained data showing that the Model 3 Standard Range sold a very limited number of cars—126 between from the time that the iZEV program launched in May 2019 until March 2020. The Drive reached out to Transport Canada to check in on these figures and learned that in more than a year's time, only 25 additional units were sold.

From May 2019 until April 2021, Tesla sold just 151 units of the Standard Range Model 3, meaning that buyers received $755,000 in subsidies to use towards the lower-range EV. Meanwhile, it amassed a sale of 22,938 units of the Standard Range Plus. This makes a total of 23,089 sales eligible for the iZEV credit, or up to $115.5 Million paid out for a model that would have otherwise not qualified for the incentive.

In total, the iZEV program has paid out 87,919 total incentives, 26 percent of which have gone towards Tesla Model 3s—more than Audi, BMW, Chrysler, Ford, Honda, Mini, Mitsubishi, Nissan, Smart, Subaru, and Volkswagen combined. The automaker which had the vehicles with the second-highest number of incentives is Hyundai at 14,413, however, that number is split between six different models, three of which are plug-in hybrid which only receive half of the $5,000 BEV incentive.


DATA VIA TRANSPORT CANADA

Smart or Scam?

Not everyone is thrilled with Tesla's gaming of the iZEV incentive. When we reported on the 94-mile Model 3 earlier this year, some called it "a great tactic" while others said that Tesla's workaround was "a stupid dodge to get around a stupid policy."

“It certainly looks like Tesla gamed the system by listing a no-frills model just under the maximum price in order to get access to millions in taxpayer subsidies for higher-priced models,” said Aaron Wudrick, federal director of the Canadian Taxpayers Federation during the outlet's previous exposé on the Tesla Model 3 Standard Range. “Everyday taxpayers are subsidizing fancy cars for wealthier people.”

As for the DMV's viewpoint, Transport Canada had previously refuted that it does not evaluate how an automaker markets its vehicles to consumers, only that it ensures eligibility criteria is met for the iZEV program. Its goal is simply to increase the affordability of battery-electric cars and the overall take-rate compared to gasoline-powered equivalents. And judging by the numbers, it did exactly that. The introduction of the Model 3 SR qualified the otherwise ineligible SR+ for the iZEV credit, something which certainly helped foster the adoption of EVs in Canada.

Whether or not Tesla's move will be remembered as bold or below the belt is something yet to be seen. But one thing is certain: it worked.

Protesters in Montreal pressure Ottawa to regularize migrant workers' status

Solidarity Across Borders is seeking regularization for all undocumented migrants

Frédéric Lacroix-Couture · The Canadian Press · 
Posted: Jul 18, 2021
People take part in a 'Status for All' demonstration in Montreal, Sunday, July 18, 2021. (Graham Hughes/The Canadian Press)


At least 100 people protested in downtown Montreal Sunday morning, calling on the federal government to put a comprehensive and continuous regularization program in place for refugees and migrants, who are the subject of "neglect" by the immigration system.

The event marked the launch of a week of demonstrations in Montreal and Ottawa, led by Solidarity Across Borders, to obtain better treatment for thousands of undocumented migrants.

Last year, Ottawa announced a regularization program for asylum seekers who worked in health care during the pandemic. Solidarity Across Borders maintains that this program, which is already full in terms of demands, excludes the majority of migrants, even those considered essential workers.

"We want full regularization for everyone, without exception because everyone is essential, whether it's people who have worked in the health sector or people in grocery stores, butcher shops or recycling pickup. They worked three times as hard, but they aren't paid as well," Mohamed Barry, a representative of Guinéens unis pour un statut, who obtained his permanent residence last year, after eight years "of fighting."

The event marked the launch of a week of demonstrations in Montreal and Ottawa, led by Solidarity Across Borders, to obtain better treatment for thousands of undocumented migrants. (The Canadian Press)

Solidarity Across Borders says many find it difficult to pay rent and food, and others are forced to take "dangerous and poorly paid jobs." During the pandemic, "the undocumented migrants endured enormous difficulties."

"Because of our situation, we don't have access to health care, social assistance, or legal work. It's still the most important thing for a human being here, right?" said Samira Jasmin, a spokesperson for Solidarity Across Borders, who has been trying to regularize her status since arriving from Algeria eight years ago.
Symbolic humanitarian request

Next Sunday, activists and undocumented migrants from Quebec plan to meet in front of Prime Minister Justin Trudeau's office in Ottawa to present a symbolic humanitarian request for all people with precarious status in the country.

The Migrant Rights Network, a Canadian anti-racist, migrant justice alliance, recently revealed that the rate of rejection of permanent residence applications in Canada on humanitarian grounds has doubled since 2019.

"For those without status, the only way out is humanitarian demand," Jasmin said.

"It also expresses a little the despair of these people because they seek by all legal means to be able to have a normal life", added Adboul Kan of Solidarity Across Borders.

The MRN found that 70 per cent of applications were rejected from January to March 2021 compared to 35 per cent in 2019.



Downtown Montreal rally seeks 'status for all' undocumented migrants

“We’re facing a steamroller that has no feelings for migrants, or for human beings in general."

Author of the article: Frédéric Tomesco
Publishing date: Jul 18, 2021 • 
Montrealers took to the streets in Montreal on Sunday July 18, 2021 in support of "Status for All", a call for permanent residency for temporary migrant workers and their families who live in Canada. PHOTO BY DAVE SIDAWAY /Montreal Gazette
Article content

A group representing undocumented migrants is stepping up the pressure on Ottawa to legalize their status ahead of a possible federal election this fall.

About 100 people gathered in downtown Montreal on Sunday morning to listen to speeches, march through the streets and demand “status for all” from the federal government as part of a rally organized by Solidarity Across Borders. Along the way, the demonstrators walked by a Dollarama store and the building that houses Premier François Legault’s Montreal office.

Canada’s federal government recently ended a limited-time permanent residency program for migrants after 10 weeks, leaving thousands of people in limbo. Many of those interviewed Sunday called on Ottawa to reinstate the program and to broaden it beyond its focus on essential workers.


“We’re facing a steamroller that has no feelings for migrants, or for human beings in general,” Hady Anne Kodoye, who immigrated from Mauritania three years ago and is still waiting for his status to be legalized, said in an interview. “The pandemic has put a lot of migrants like me deep into precariousness.”

Sunday’s gathering is part of a “week of action” that will include demonstrations, leaflet distribution, a community supper and a friendly soccer game. A march to Ottawa next weekend will cap the proceedings.

Montrealers in support of “Status for All” say all migrant workers who put their lives at risk working during the pandemic — not just those deemed essential by the government — should get permanent residency. PHOTO BY DAVE SIDAWAY /Montreal Gazette

New figures released last week by the Migrant Rights Network, a Canadian anti-racism alliance, suggest rejection rates of applications for permanent residence on humanitarian grounds have doubled since the start of the pandemic after Canada closed its borders. About 70 per cent of undocumented migrants had their application for permanent residence turned down in the first quarter of 2021, up from 35 per cent in 2019.

“We want an inclusive program for all migrants,” said Abdoul Kane, a Senegal native who is in the process of applying for permanent residence. “We don’t want a program that calls some people essential and others no. We’re all essential.”


Prominent Canadians such as former United Nations High Commissioner for Human Rights Louise Arbour have called on the federal government to legalize undocumented migrants, who play a key role in powering the black-market economy and aren’t included in official statistics.


“I just want Ottawa to show proof of humanity,” said Mohamed Barry, who moved here from Guinea eight years ago and became a permanent resident last year. Undocumented migrants “are here, they are contributing to the well-being of this society. They should be regularized. They shouldn’t be left behind.”

Health care, food distribution, meatpacking and recycling are all industries that employ undocumented workers, according to Barry. Many of those migrants — who have no access to free health care — had to put themselves in danger by working in close proximity to other employees during the initial waves of the pandemic.

“There was a high risk of getting the virus,” said Barry, who worked in a warehouse last year and experienced firsthand the conditions he’s now denouncing. “The measures were not really respected well. There were no masks. We had to work below freezing, sometimes outside, which was really hard.”

Also attending Sunday’s march was Quebec writer Anne-Marie Saint-Cerny, who drove in from Val-David to show her support.

“I’m a ‘pure laine’ Quebecer, and it’s not true that we are going to let people who helped us get kicked out of the country,” she said in an interview. “We’re not like that. Over the years we’ve welcomed Haitians, Vietnamese, and we’re going to do the same thing now. Many of these recent migrants are the ones who washed our parents and our grandparents. We cannot forget that.”

Leonard Cohen Lives on Forever on Greek Island of Hydra

Leonard Cohen performing in 2008. Cohen adored his home on Hydra. Credit: Rama/Wikimedia Commons/CC BY-SA 2.0

Influential singer/songwriter Leonard Cohen, who passed away nearly five years ago, was continuously inspired by the Greek island Hydra throughout his long career.

An official music video reminds his fans and music lovers worldwide what a truly great artist Cohen was and how lucky we were to have him here for as long as we did.

The great Canadian musician’s many Greek fans especially will rejoice, since the beautifully-shot video is entirely shot on Hydra island, Cohen’s literal second home.

“Moving On,” released after his death, is Cohen’s song about loss and the feeling of deep, unbearable heartache it creates.

Music video highlights Leonard Cohen’s home on Hydra

The song, which begins with the tolling of a mournful church bell, is carried along by a melancholy mandolin and continues with the characteristic, spoken-word, singing of the troubadour.

Adding a touch of sarcasm in the line, “Who’s moving on, who’s kidding who?” seems the only way the singer can make it through the pain of his loss.

The video shows the house that Cohen bought on the Greek island of Hydra in 1960 which served as his second home for the rest of his life.

The complete absence of any other humans in the sun-drenched house adds even more poignancy to the lyrics.

For the Canadian songwriter, the house on Hydra was not just his summer home, but a place where he felt free to spend months at a time and where he composed many of his lyrics.

This was also the place where Cohen’s great love, the Norwegian woman Marianne Ihlen, who was his muse in the 1960s, lived. She was the subject of one of his first masterpieces, “So Long, Marianne.”

The “stars” of the video are a cat, a donkey, a tangerine, flowers and, of course, the interior of the house where Cohen actually wrote some of his masterpieces, at least in the 1960s and 1970s.

Its serene, stunningly beautiful landscapes, the ancient streets of Hydra, and the breathtaking sunset at the end make the video as moving as the song itself.

Cohen’s life and career

The Canadian songwriter enjoyed a successful career in music which lasted for fifty years.

He was among a handful of revered songwriters of the 1960s and 1970s, along with Bob Dylan, Paul Simon, Joni Mitchell and James Taylor, marking the two most important decades in modern music history.

Cohen, who began his adult life as a writer, traveled a great deal, which seemed to him mandatory for anyone who wanted to write from experience. In Hydra, he found the serenity and solitude he needed in order to pen his works.

This is where he wrote his two books, The Favourite Game (1963) and Beautiful Losers (1966). It was also there where Cohen met Marianne Ihlen, his partner and muse for most of the 1960s.

The Canadian writer found the native people of Hydra mysterious and intriguing, and he came to love living there.

Cohen later said that buying his island house was the smartest decision he had ever made.

The island of Hydra is also where his first two albums were conceived. “Songs of Leonard Cohen” (1967) and “Songs from a Room” (1969), featuring spare arrangements and stark delivery of his poetic lyrics, established the young Canadian as a great name in the music world.

Leonard Cohen viewed as a local on Hydra

Cohen spent so much of his time on the island that by the 1980s, people viewed him as just another local resident. He remained very popular in Greece even though he had only performed in Athens one time.

The 1980s were a time which saw a sea change in the music world, with young audiences uninterested in Cohen’s deep, personal lyrics and spare, acoustic arrangements.

In 1988, however, the troubadour almost completely reinvented himself with “I’m Your Man,” a critically and commercially successful album with catchier arrangements which introduced him to a new generation while luring back his older fans.

After that time Cohen continued being active in the studio, releasing one more album, “The Future,” along the same vein, firmly re-establishing himself in the music business by gaining an all-new audience.

However, in 1995 he put a pause in his music production by entering the Mt. Baldy Zen Center outside of Los Angeles and living there for some time. For many, that seemed to signal the end of Cohen’s music career.

Yet he returned to music in 2001 with his “Ten New Songs,” and continued creating for another fifteen years.

Cohen again toured the world and recorded four more albums between 2004 and 2016, the last being the acclaimed “You Want it Darker,” released only days before his death on November 7, 2016 at the age of 82.

Keeping his dark humor until the end, Cohen had once stated, “I intend to live forever.”

Still, in a way, this is absolutely true because his legacy is so powerful that, for many, the songwriter is indeed still around, whispering his bittersweet lyrics in countless ears.

On November 22, 2019 Cohen’s record company released an album of nine songs left over from the “You Want it Darker” recording sessions, with Cohen’s lyrics set to music by his son, Adam Cohen, along with various collaborators.

Entitled “Thanks for the Dance,” the album received as great reviews as if it had been a release from a living artist.

The song “Moving On” is from this album

 

The Oil Industry Is Borrowing Again, But This Time It’s Different

Two years ago, Wall Street banks were on their way out of a long-term relationship with the oil industry. Now, with oil prices over $70 for the first time in three years, big bond buyers are snapping up oil bonds once again.

Only there is a condition this time.

The Wall Street Journal’s Joe Wallace and Collin Eaton wrote this week that Wall Street was buying bonds from non-investment-grade U.S. energy companies, which took advantage of record low interest rates to raise some $34 billion in fresh debt in the first half of the year.

That’s twice as much as the industry raised over the same period last year. But investors don’t want borrowers to use the cash to drill new wells. They want them to use it to pay off older debt and shore up balance sheets.

It makes sense, really, although it is a marked departure from how banks normally react to oil industry crises. The 2014 oil price collapse, in hindsight, may have been the last “normal” crisis. Oil prices fell, funding dried up, supply tightened, prices went up, banks were willing to lend again, and producers poured the money into boosting production.

Since then, however, the energy transition push has really gathered pace and banks have more than one reason to not be so willing to lend to the oil industry. With the world’s biggest asset managers setting up net-zero groups to effectively force their institutional clients to reduce their carbon footprint and with the Biden administration throwing its weight behind the push for lower emissions, banks really have little choice but to follow the current. Their own shareholders are increasingly concerned about the environment, too.

Yet business is business, and nowhere is this clearer than in banks’ dealings with the oil industry. Bank shareholders may be concerned about the environment, but they certainly would be more concerned about their dividend—and part of that comes from income made from lending to oil. And the higher oil prices go, the more willing banks will be to lend to those that produce it.

When they were unwilling to lend to the oil industry, other lenders stepped in. Last year, alternative investment firms scooped up hundreds of millions in oil industry debt from banks that were cutting their exposure to the politically incorrect industry. Hedge funds and other so-called shadow lenders don’t seem to have banks’ misgivings about profiting from oil and gas.

Now banks have mellowed towards oil somewhat, but it is an interesting twist that the current loans come with the condition of not boosting output. Again, it makes sense. For years, the shareholders of U.S. shale oil companies have been complaining about poor returns as the companies put everything into output growth. Now it’s payback time, and shareholders want their returns.

So do lenders, apparently.

Per the WSJ article, this year, bond buyers “want to see companies repairing their balance sheets and delivering to creditors and shareholders rather than plowing money into new wells.”

This, by the way, would strengthen the borrowers themselves, positioning them better for whenever they can afford to start boosting production again. This may happen before too long. The International Energy Agency said earlier this month it expected oil demand to hit 100.6 million bpd next year, and OPEC this week predicted that demand will top 100 million bpd in 2022. That’s a lot of additional oil, and some of it will come from those same non-investment-grade borrowers from the U.S. shale patch.

In the meantime, however, oil companies’ restraint is helping to keep prices where they are and add upward pressure on them. U.S. oil production as of July 9 stood at 11.4 million bpd. That was 100,000 bpd higher than in the previous week and 400,000 bpd higher than a year ago. It was, however, way lower than the 12.3 million bpd for the week to July 10, 2019.

Production restraint, then, is paying off in more than one way. On the one hand, it has kept prices higher—even if some shale producers failed to benefit fully from them as they hedged their 2021 production too soon. On the other, these higher prices are making banks more willing to lend to oil companies again. On a third hand, the shareholders of these companies are finally being made happy with the new prioritization of returns and debt repayment.

The U.S. shale oil industry after the worst of the pandemic appears to have become leaner, again, but also healthier in terms of balance sheet strength. This is particularly true for those who are preparing themselves for a world where demand for oil would be much lower and prices would also be lower, according to industry insiders cited by the WSJ reporters. Investor interest in oil, then, is still alive and kicking, despite the ESG investment rush and all that. It is a simple example of the basic principle of how markets work: if there is money to be made from something, money will be made from that something, regardless of its reputational standing in the public eye.

By Irina Slav for Oilprice.com 

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Trump Claims Americans 'Refusing to Take the Vaccine' Due to Mistrust of Biden Admin

BY NATALIE COLAROSSI ON 7/18/21 

Former President Donald Trump issued a statement on Sunday claiming that Americans are "refusing" to take the coronavirus vaccine due to mistrust of the Biden administration, the media and the 2020 presidential election results.

"Joe Biden kept talking about how good of a job he's doing on the distribution of the Vaccine that was developed by Operation Warp Speed or, quite simply, the Trump Administration. He's not doing well at all," Trump's statement said.

"He's way behind schedule, and people are refusing to take the Vaccine because they don't trust his Administration, they don't trust the Election results, and they certainly don't trust the Fake News, which is refusing to tell the Truth," the statement added.

Though Trump's administration faced criticism for a slow vaccine rollout that significantly lagged behind expectations in December and January, the former president has continuously praised his COVID-19 response team and pointed fingers at President Joe Biden. Since leaving office, Trump has also continued to push the baseless conspiracy theory that the election was stolen due to mass voter fraud.

Trump's Sunday statement comes just two weeks after the Biden administration failed to reach its vaccination goal of partially inoculating at least 70 percent of Americans by July 4. Still, over 161 million people are fully vaccinated and 68 percent of adults have received at least one dose, according to the Centers for Disease Control and Prevention (CDC). However, some 90 million eligible people have yet to receive at least one shot.

Former President Donald Trump said Americans are "refusing" the COVID-19 vaccine because they distrust the Biden administration. Here, Trump speaks at the Conservative Political Action Conference (CPAC) in Dallas on July 11.ANDY JACOBSOHN/AFP/GETTY 

Now, Biden's administration is scrambling to vaccinate more Americans as COVID-19 cases are rising across the country due to the highly contagious Delta variant.

According to a Friday report from the CDC, coronavirus cases across the U.S. are up by nearly 70 percent and hospitalizations are up by 36 percent from the previous week. At least 38 states have shown a 50 percent increase of new cases in the past week, with the variant appearing to spread fastest amongst unvaccinated populations.
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On Sunday, U.S. Surgeon General Vivek Murthy said that 99.5 percent of new COVID-19 deaths are happening among unvaccinated people, and expressed concern that the issue could quickly become worse.

"I am worried about what is to come because we are seeing increasing cases among the unvaccinated in particular. And while, if you are vaccinated, you are very well protected against hospitalization and death, unfortunately that is not true if you are not vaccinated," Murthy said Sunday on CNN's State of the Union.

The Biden administration has said some of the blame falls on social media companies, arguing that Americans are refusing to be vaccinated due to the rapid spread of misinformation online.

On Friday, Biden said the amount of misinformation on Facebook and other social media sites was "killing people," and added that "the only pandemic we have is among [the] unvaccinated" population.

In response, Facebook issued a statement saying that 85 percent of its users were vaccinated or plan to be, and the administration was "looking for scapegoats for missing their vaccine goals."


Christopher Krebs, the former director of the Cybersecurity and Infrastructure Security Agency (CISA), said on Sunday that while Facebook and other social media companies can provide helpful information on the pandemic and vaccine safety, misinformation is likely going to continue to spread.

Krebs added that the amount of vaccine misinformation online is akin to the way misinformation about the 2020 presidential election spread.

"What we are seeing here is an ecosystem of information purveyors. Some of this is politically motivated. Some of it is the anti-vax community. Some of it is profiteering. And I tend to believe that there's a lot of that going on here," he said during a CBS interview Sunday.


Newsweek contacted the White House for additional comment, but did not hear back in time for publication.
Vaccine inequity: Inside the cutthroat race to secure doses


Lori Hinnant, Maria Cheng and Aniruddha Ghosal
The Associated Press Staff
Sunday, July 18, 2021 

LONG READ

Airport workers spray the cargo of COVAX COVID-19 vaccines on arrival in Antananarivo, Madagascar, Saturday May 8, 2021. (AP Photo/Alexander Joe)

PARIS -- No one disputes that the world is unfair. But no one expected a vaccine gap between the global rich and poor that was this bad, this far into the pandemic.

Inequity is everywhere: Inoculations go begging in the United States while Haiti, a short plane ride away, received its first delivery July 15 after months of promises -- 500,000 doses for a population over 11 million. Canada has procured more than 10 doses for every resident; Sierra Leone's vaccination rate just cracked 1% on June 20.

It's like a famine in which "the richest guys grab the baker," said Strive Masiyiwa, the African Union's envoy for vaccine acquisition.

In fact, European and American officials deeply involved in bankrolling and distributing the vaccines against coronavirus have told The Associated Press there was no thought of how to handle the situation globally. Instead, they jostled for their own domestic use.

But there are more specific reasons why vaccines have and have not reached the haves and have-nots.

COVID-19 unexpectedly devastated wealthy countries first -- and some of them were among the few places that make the vaccines. Export restrictions kept the doses within their borders.

There was a global purchase plan to provide vaccines for poorer countries, but it was so flawed and underfunded that it couldn't compete in the cutthroat competition to buy. Intellectual property rights vied with global public health for priority. Rich countries expanded vaccinations to younger and younger people, ignored the repeated pleas of health officials to donate their doses instead and debated booster shots - -- even as poor countries couldn't vaccinate the most susceptible.

The disparity was in some ways inevitable; wealthy nations expected a return on their investment of taxpayer money. But the scale of the inequity, the stockpiling of unused vaccines, the lack of a viable global plan to solve a global problem has shocked health officials, though it wasn't the first time.

"This was a deliberate global architecture of unfairness," Masiyiwa told a Milkin Institute conference.

"We have no access to vaccines either as donations or available for us to purchase. Am I surprised? No, because this is where we were with the HIV pandemic. Eight years after therapeutics were available in the West, we did not receive them and we lost 10 million people."

"It's simple math," he said. "We have no access. We have no vaccine miracle."

------

The World Health Organization has duly updated its epidemic playbook after every outbreak, most recently with Ebola in mind. Then, as often in the decades before, an emerging illness was largely contained to countries lacking robust public health services, with poor sanitation and crowded living conditions and limited travel connections.

For years, the WHO assessed countries' readiness for a flu pandemic: The United States, European countries and even India ranked near the top. The U.S. readiness was 96%, and Britain at 93%.

On Jan. 30, 2020, WHO declared the coronavirus outbreak in China to be a global emergency. It would be months before the word "pandemic" became official.

But that same day, the Coalition for Epidemic Preparedness and Innovations, or CEPI, was planning for the worst. CEPI announced "a call for proven vaccine technologies applicable for large scale manufacturing," according to minutes from its scientific advisory group. CEPI said it would be critical "to support the strategy for global access" early in the game.

CEPI quickly invested in two promising coronavirus vaccines being developed by Moderna and CureVac.

"We said very early on that it would be important to have a platform where all countries could draw vaccines from, where there's accountability and transparency," said Christian Happi, a professor at Nigeria's Redeemer's University and a member of CEPI's scientific advisory committee. "But the whole idea was that we thought rich countries would fund it for the developing world."

Happi said officials never expected the pandemic would strike first and hardest in Europe and the U.S. Or that their assessment of preparedness in the world's most advanced economies would prove horrifically optimistic.

Global health experts would soon come to realize that rich countries "could sign a piece of paper saying they believe in equity, but as soon as the chips are down, they will do whatever they want," he said.

On March 16, five days after WHO first described COVID-19 as a "pandemic," the novel mRNA vaccine developed by Moderna was injected into a trial participant for the first time.

By then, the disease was tearing through the elderly populations of Europe and the United States.

Moderna and Pfizer/BioNTech were the first companies to come out with an mRNA vaccine, devising methods of mass production almost on the fly. Scientists at Britain's Oxford University also came up with a vaccine with a more traditional platform, and Bill Gates brokered a deal for them to partner with AstraZeneca, a pharmaceutical company with global reach but no experience in vaccine production.

On April 30, the deal was confirmed: AstraZeneca took sole responsibility for the global production and distribution of the Oxford vaccine and pledged to sell it for "a few dollars a dose." Over the next few weeks, the U.S. and Britain secured agreements totaling 400 million doses from AstraZeneca.

The race to make and secure vaccines was on, and the United States and Britain were leagues in front of the rest of the world -- a lead they wouldn't lose. Still, both countries would see life expectancy decline by at least a year in 2020, the biggest drop since World War II. In the European Union, 22 countries saw their average lifespans cut short, with Italy leading the list.

------

But as grim as the situation was, all those countries had a major advantage: They were home to the pharmaceutical companies with the most promising vaccine candidates, the world's most advanced production facilities, and the money to fund both.

On May 15, 2020, U.S. President Donald Trump announced Operation Warp Speed and promised to deliver vaccines against coronavirus by New Year's. With unparalleled money and ambition behind the project, Warp Speed head Moncef Slaoui was more confident than his counterparts in Europe that a vaccine was in the offing. He signed contracts almost without regard to price or conditions.

"We were frankly focused on getting this as fast as humanly possible. If I had to redo it, I probably should have voiced more of a global dimension," said Slaoui. "The operation had focused, which was frankly also part of its success, on staying out of the politics and making the vaccines."

The idea of including clauses to ensure that vaccines would go to anyone besides Americans wasn't even considered.

At the same time, the U.S. repeatedly invoked the Defense Production Act -- 18 times under the Trump Administration and at least once under Biden. The moves barred exports of crucial raw materials as factories were ramping up production of the as-yet-unapproved vaccines -- and eventually, of the vaccines themselves.

But it also meant those materials would run low in much of the rest of the world. The U.S. stranglehold would lift only in spring 2021, and only partially.

Operation Warp Speed supercharged the global race to secure vaccines, but it would still take another two weeks until COVAX -- the COVID-19 Vaccines Global Access Facility -- was formally announced as the entity to ensure equity, with the Serum Institute of India as the core supplier for the developing world.

COVAX had the backing of the World Health Organization, CEPI, vaccines alliance Gavi and the powerful Gates Foundation. What it did not have was cash, and without cash it could secure no contracts.

"Operation Warp Speed signed the first public deals and that started a chain reaction," said Gian Gandhi, UNICEF's COVAX coordinator for supply. "It was a like a rush on the banks, but to buy up the expected supply."

Some involved in the COVAX project flagged India as a potential problem early on, according to minutes of meetings in late spring and early summer of 2020.

India's government had blocked exports of protective gear, but many global health authorities who hadn't fully grasped the extent of pandemic nationalism found it unimaginable that the country would block vaccines when the world was counting on them. Also, India had so far been spared the waves of death that were sweeping across Europe and the Americas.

A separate plan put forward by the government of Costa Rica and the World Health Organization to create a technology-sharing platform to expand vaccine production foundered. Not a single company agreed to share its blueprints, even for a fee -- and no government pushed them behind the scenes, according to multiple people involved in the project.

On the global scale, the one organization that could have pushed for more technology sharing was the Gates Foundation, whose money to WHO nearly matches that of the U.S. government.

Instead, Bill Gates defended stringent intellectual property rights as the best way to speed innovation. His foundation poured money and influence into the Access to COVID-19 Tools Accelerator, which also failed to generate the money or influence needed to ramp up production outside already existing hubs.

In the United States, meanwhile, manufacturing and the trials went on in parallel, which is where taxpayers and the companies took enormous risks that paid off for both.

But in retrospect, Slaoui said, given the sheer amount of taxpayer money involved, each time they signed new contracts the U.S. and other countries could have pushed companies harder to share their knowledge, if only for the duration of the pandemic.

"From a geopolitical standpoint, it's critical that they do that," he said.

Nowhere was the situation more dire than Africa. In February, WHO's African expert in vaccine development, Richard Mihigo, was among many who said the continent's experience with other pandemics had uniquely prepared it for a complex vaccine deployment.

Five months later, contemplating the plight of a continent that gets 99% of its vaccines from abroad, Mihigo adds a rueful footnote: "One of the lessons we learned from this pandemic is how badly prepared we were in vaccine production in the region and how dependent we were on imports."

Those imports have only barely begun to materialize -- and they are insufficient to meet even the limited goals of the COVAX initiative to vaccinate at least 20% of the population of 92 low- and middle-income countries by the end of this year.

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From the start, the coalition of organizations that created COVAX found themselves fighting the last war.

The plan was designed as an international pool to spur demand for vaccines and treatment of diseases with a relatively small global footprint, said Winnie Byanyima, head of UNAIDS.

Something like Ebola. But the coronavirus pandemic looked nothing like an Ebola outbreak.

"That itself was a structural weakness," she said.

Although the World Bank and the International Monetary Fund had between them set aside billions for vaccinating the developing world, that money was intended to go to countries and was out of bounds for a global vaccine sharing plan like COVAX, said Mike Muldoon, managing director for innovative finance at the Rockefeller Foundation.

Meanwhile, governments competed to secure contracts for vaccines by the hundreds of millions.

On Dec. 8, Britain became the first country to formally authorize a start to widespread vaccinations, injecting 90-year-old Margaret Keenan with a dose of the Pfizer-BioNTech vaccine. Six days later, the United States started its own vaccinations. And on Dec. 26, the EU followed suit. China and Russia had been vaccinating even before releasing data from their homegrown inoculations.

The Western companies with the most promising doses, including Pfizer/BioNTech, Moderna and AstraZeneca, had by then been churning out vials for months before formal approval, based on pledges from the wealthy countries that an enormous market awaited. Those doses were stockpiled in Europe and North America and a small number of countries, like Israel, that paid a premium.

COVAX pleaded for cash to do the same. Instead, it got pledges.

"As time passed and it became clear which vaccine candidates were going to be the leading contenders and which were most likely to succeed, the governments that had resources went and bought the supplies," CEPI chief executive Dr. Richard Hatchett told the AP. "COVAX was not in a position to do that."

Months later, when COVAX finally had the money to sign deals for global supplies, Hatchett acknowledged they were at the end of the line.

The lack of capital available to vaccine makers to boost their capacity outside the small number of existing manufacturing hubs was also "a lost opportunity," Hatchett said.

"We approached the international financing institutions, including the World Bank and the (International Finance Corporation) about making those investments and they were not willing to do that," he said. CEPI ended up investing about $1.5 billion, far less than what a major financial institution might have been able to commit.

COVAX missed its own goal of beginning vaccinations in poor countries at the same time as rich ones. It finally delivered vaccines on Feb. 24, to Ghana, a load of 600,000 AstraZeneca doses manufactured by the Serum Institute of India and transported by UNICEF planes.

By that date, 27% of the population in Britain had been vaccinated, 13% in the U.S., 5% in Europe -- and 0.23% in Africa, in countries that had secured their own bilateral deals after growing impatient with COVAX delays. The rift was growing by millions of doses every day.

And pharmaceutical plants were beginning to crumble under the promises they'd made.

AstraZeneca announced repeated delivery cuts to Europe. Pfizer's production briefly slowed. A fire at a Serum Institute construction site prompted a letter to Brazil warning that "supply to you cannot be guaranteed in the foreseeable months." Moderna supply cuts soon followed to Britain and Canada.

In the United States, officials tossed millions of corrupted doses of vaccine from the Emergent Biosolutions plant in Baltimore after discovering that workers had inadvertently blended ingredients from the AstraZeneca and Johnson & Johnson vaccines. An untold number of doses were never produced because of new restrictions meant to prevent errors. Many of those vaccines were intended for export.

So COVAX had to hope that the AstraZeneca vaccine being produced in India would come through, because it had secured few of the innovative mRNA doses that are now considered the most effective against the coronavirus variants. The initial refrigeration requirements were daunting, and the price was higher than the traditional vaccine candidates.

The mRNA vaccines are widely considered a scientific and manufacturing triumph -- and a risky bet. Never before approved for use against any disease, they are now considered a hugely promising medical innovation and a potential gamechanger against infection.

But by the time it was clear the mRNA doses were a viable alternative, even in poor countries with limited cold chain, the available supply had been snapped up in Europe, the United States and Canada. And India, in the throes of its own COVID-19 surge, diverted its vaccines for its own use.

According to the People's Vaccine Alliance, a grouping of human rights organizations advocating for broader sharing of vaccines and their underlying technology, the coronavirus has created nine new billionaires. The top six are linked to the successful mRNA vaccines.

For Byanyima, of UNAIDS, this is a travesty and a sign that the world has learned little in the decades since the AIDS pandemic was brought under control in the United States, only to kill millions in Africa because treatments were unaffordable: "Medicines should be a global public good, not just like a luxury handbag you buy on the market."

COVAX has delivered only 107 million doses, and now is forced to rely upon uncertain donations from countries that may prefer to donate directly to the needy, so they can receive the credit.

A readout from its June board meeting slipped in an acknowledgement that it needed to better interpret and respond to market conditions and "the reality that a higher risk appetite is needed in a pandemic setting."

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For the pharmaceutical industry, mRNA is the ultimate confirmation that hard work and risk-taking is rewarded. And those companies keep tight hold on the keys to their successful vaccines.

When Moderna and Pfizer created new production lines, it was in the insular European and American manufacturing networks that had as much stake as anyone in both ensuring that the injections meet the highest standards and keeping promises not to abuse intellectual property.

Many public health officials have pushed for technology transfer during the pandemic. Initially resistant, the Gates Foundation has changed its position in favor of sharing.

Dr. Clemence Auer, the EU's lead negotiator for vaccine contracts last summer, said the question of compelling pharmaceutical companies to suspend their vaccine intellectual property rights to increase the worldwide supply of coronavirus vaccines never even came up.

"We had a mandate to buy vaccines, not to talk about intellectual property, " Auer said.

"The global community should have had this discussion back in 2020 but that didn't happen," he said. "Maybe we should have done it last year, but now it's too late. It is spilled milk."

CEPI includes equity clauses in the vaccines that it invests in, among them the successful Moderna candidate, but has yet to invoke them during the pandemic. Some include requirements to make a vaccine available to populations in need at affordable prices, as is the case in CEPI's Moderna contract. But Moderna was first available exclusively in wealthy countries and even now only limited amounts are going outside Europe and the United States.

A separate push to lift intellectual property restrictions on vaccines and medicines has also gone nowhere in the World Trade Organization.

And WHO is reticent to criticize donor nations or the pharmaceutical companies. The U.N. health agency works by consensus and needs them for other aspects of global health -- and for its own continued existence. The Biden administration has reversed Trump's decision to defund and leave WHO, but the damage has been done.

"A lot of these multinational organizations, these plans, these coalitions, they don't have teeth to enforce what they think is a fair and equitable way to distribute resources," said Dr. Ingrid Katz, an infectious disease researcher at the Center for Global Health at Massachusetts General Hospital. She said the key question is whether vaccines and essential medications are a commodity or a right.

"If it's going to be a commodity, we're going to keep walking down this road every time we have something like this," she said.

And if it is all going to rely on the generosity of rich countries, a lot of people are going to die. Four million have died already.

In all, at the recent Group of Seven meeting of wealthy nations pledged to donate 850 million doses, compared with the 11 billion that WHO says will be needed to end the pandemic.

A close look at the G-7 promises of donations shows that most aren't expected to be delivered until well into 2022. The Biden administration fell short on its pledge to send 80 million doses abroad by the end of June: By mid-July, at least 44 million doses had been sent, including 2.5 million to Canada, which has already given at least one vaccine dose to more of its population than any other country. Africa has yet to receive its doses from the United States.

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Oceans away from the deprivation of the developing world, 7-year-old Russell Bright and his 5-year-old brother went to Ochsner Medical Center in New Orleans to get their shots -- part of a trial for young children. Maybe they got the vaccine; maybe they got the placebo.

Wearing a Spider-Man mask, Russell said he longs for a vacation trip to the water park and then a return to school without having to wear masks and stay at arms' length from his friends.

"Both me and my wife are already vaccinated," said his father, Adam, "and so the sooner I can get them vaccinated and to feel comfortable being outside, not having to wear a mask, I thought the easiest way to get it is to go through the trial."

Scientists agree that children are at low risk from COVID-19. But that hasn't stopped richer countries from stockpiling precious vaccine supplies to inoculate the young, even as poor countries have few or no shots to give.

A recent meeting of WHO's vaccine allocation group disbanded with nothing accomplished, because there was no vaccine to allocate. "Zero doses of AstraZeneca vaccine, zero doses of Pfizer vaccine, zero doses of J&J vaccine," said Dr. Bruce Aylward, a senior advisor at the organization.

"Every single one of our suppliers is unable to supply during this period because others are making demands on those products, others who are vaccinating very young populations that are not at risk," Aylward said.

Both Trump and Biden administration officials reject the notion that the U.S. or any country would share vaccines until they'd protected their own. And they both note that the U.S. bore the brunt of the pandemic last year, topping the world in confirmed cases and deaths.

But a plummeting jet takes all passengers with it, whether or not they are wearing masks. And the failure to provide vaccines across the globe ensures that COVID-19 will continue to spread, and mutate, and sicken, and kill.

"It speaks volumes about where we are as a globe when you have the source of decision-making sitting with very few people who have a lot of wealth and are essentially making life and death decisions for the rest of the globe," Mass General's Katz said. "Every month that we lost put us further and further behind."

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Maria Cheng reported from London, and Aniruddha Ghosal from New Delhi. Other contributors include Sally Ho in Seattle; Zeke Miller in Washington; Danica Coto in San Juan, Puerto Rico; and Stacey Plaisance in New Orleans.

The Observer view on South Africa’s problems

For all the corruption of recent years, Cyril Ramaphosa’s ‘rainbow nation’ can still make good on Nelson Mandela’s values
A woman clears debris from the street after violence and looting in Durban last week. Photograph: Guillem Sartorio/AFP/Getty Images

Today is the anniversary of the birthday of Nelson Mandela, the first president of a free South Africa and a global symbol of tolerance, sacrifice, integrity and the battle against racism.

When, in 2009, the UN declared 18 July a day to honour Mandela’s values, South Africa was still seen worldwide as a success story. The “rainbow nation” had overcome the violent racial oppression of its past and was fighting apartheid’s toxic legacy of economic inequality. It had one of the most progressive constitutions in the world and a steady record of economic growth. The challenges the new democracy faced were all too evident, but South Africa’s recent history seemed a message of hope for us all nonetheless.

This weekend, it is despair that dominates. Days of violent protest, looting and vandalism have left the country staggering. The economy was already faltering even before Covid struck and has now sustained a further catastrophic blow. President Cyril Ramaphosa, who took power in 2018, has called for steadfast defence of South Africa’s democracy against what he says is a deliberate attempt to prompt an insurrection. The rule of law looks shaky. Racial tensions are high. The chances of a tolerant, prosperous future now look dim.

So what went wrong? In 2007, the African National Congress, the ruling party, selected Jacob Zuma as its leader. Two years later, Zuma became president too. The contrast with Mandela, canonised as a secular saint, was stark. No one would describe Zuma as a model of probity. He did, however, have impeccable credentials as a frontline fighter in the battle against apartheid and was popular with the party’s grassroots.

Over the next nine years, Zuma presided over an assault on South Africa’s institutions, public utilities and government. Graft contaminated almost every corner of public life, unemployment and crime soared after years of decline. The health service and the police suffered very badly. Zuma and his supporters said they were helping the poor. In fact, many were helping themselves.

Eventually, Zuma was ousted and Ramaphosa took over. The former labour activist turned tycoon set about cleansing South Africa’s Augean stables. This is a herculean task but one Ramaphosa has approached with grim determination, even if his execution has been slow. A problem has been trying to manage the factional battles within the ANC. Ramaphosa leads a moderate coalition within the ruling party and has wide support. But his efforts to avoid the confrontation with those still loyal to Zuma have failed. Zuma’s imprisonment on contempt of court charges sparked the unrest and it appears to have been instigated by his followers.

Perhaps if Ramaphosa had been less concerned with the internal politics of the ruling party and had hit harder or earlier to enforce the rule of law, the events of recent days could have been avoided. All too often, ANC politicians have put the interests of the party above those of the country. Ramaphosa, too, may be guilty of this. If his country is to prosper, this must stop.

But though many will despair for South Africa, this newspaper is not among them. The Observer supported the anti-apartheid struggle through its darkest days, celebrated the downfall of that evil regime and still believes in the capacity of South Africans to create a better country for all citizens. Recent days have seen appalling violence but also communities coming together to clear the shattered glass, protect vital services and help those left without bread.

Those who hoped to derail Ramaphosa’s efforts at reform are unlikely to succeed and their failure will strengthen South Africa’s democracy. This should give hope to all those who care about this troubled, inspiring country.