Tag: U.S. economy

Dow Jones Plunges As Trump Announces New Tariffs

Trump announced new tariffs on goods from China on Thursday afternoon and sent the stock market tumbling.

At 1:25 p.m. Eastern time, the Dow Jones Industrial Average (DJIA) stood at 27,121. At 1:26 p.m., Trump announced on Twitter “the U.S. will start, on September 1st, putting a small additional Tariff of 10% on the remaining 300 Billion Dollars of goods and products coming from China into our Country.”

By 1:50 p.m., the Dow plunged more than 350 points to 26,735.

By 2:25 p.m., an hour after Trump’s announcement, the Dow dropped even more, to 26,680, or 441 points lower.

View the complete August 1 article by Dan Desai Martin on the National Memo website here.

How Trump’s latest China tariffs could squeeze US consumers

WASHINGTON (AP) — The latest tariffs President Donald Trump plans to impose on Chinese goods would cost U.S. households an average of $200 a year, some economists estimate, and would start to bite consumers and retailers just as the holiday shopping season begins.

That cost would come on top of the roughly $830 cost imposed per household from Trump’s existing tariffs, according to a New York Federal Reserve analysis.

Trump plans to tax $300 billion of Chinese imports at 10% starting in September with the goal of accelerating trade talks with Beijing to favor the United States. The new tariffs would be in addition to 25% tariffs Trump has imposed on $250 billion in Chinese products. Those are mostly industrial goods. By contrast, the new tariffs would target products used by American consumers, like shoes, clothing and cellphones.

By Friday, Trump’s new planned tariffs had triggered worries, especially among retailers, about the consequences. Retail stores, many of which have been struggling, would have to make the painful choice of either absorbing the higher costs from the new tariffs or imposing them on price-conscious customers.

View the complete August 2 article by Josh Boak, Anne D’Innocenzio and Joe McDonald on the Associated Press website here.

American farmer: Trump trade war ‘took away all our markets’

AlterNet logoDefenders of President Donald Trump’s trade war with China have insisted that American farmers will be better off in the longrun, and the White House recently announced it would be giving farmers an additional $16 billion in aid to help them cope with the trade war’s effects. But in a report for Yahoo Finance this week, journalist Adriana Belmonte stresses that American farmers have a problem that farm aid isn’t going to cure: they’re lost their markets.

China, Belmonte notes, purchased a lot of American farm products in the past, from wheat to soybeans. In 2016 and 2017, for example, China imported 61 million bushels of wheat from the United States. But thanks to the trade war, Belmonte reports, China is importing from other countries instead, including wheat from Russia and soybeans from Brazil.

Bob Kuylen, a North Dakota wheat farmer, told Yahoo Finance, “This trade thing is what’s brought on by the president, and it’s really frustrating because he took away all of our markets. We live in an area where we’re kind of in the middle of nowhere. It costs us a lot of money: over $1 a bushel to get our grain to markets.”

View the complete August 1 article by Alex Henderson on the AlterNet website here.

Why the Fed Cut Rates: To Try to Fix Last Year’s Mistake

New York Times logoNot a recession-fighting measure per se, but a recalibration of strategy, and a recognition that the world has changed.

Several of the questions directed at Jerome Powell at his Wednesday afternoon news conference boiled down to this: Why did you just cut interest rates when, by your own acknowledgment, the American economy looks perfectly solid? What good can this possibly achieve?

Mr. Powell, the Federal Reserve chair, answered by ticking off the reasons — persistently low inflation and a troubled world economy that poses risks to the United States — for the Fed policy committee’s move.

But there is a broader way to interpret it.

View the complete July 31 article by Neil Irwin on The New York Times website here.

If the U.S. economy is in good shape, why is the Federal Reserve cutting interest rates?

Washington Post logoThe Federal Reserve did something Wednesday that it hasn’t done in more than a decade: cut interest rates. The question on a lot of people’s minds is why.

Lowering interest rates, the Fed’s main way to boost the economy, is typically used in dire times, which it’s difficult to argue the United States is experiencing right now. Instead, top Fed officials are defending this as an “insurance cut” that’s akin to an immunization shot in the arm. They want to counteract the negative effects of President Trump’s trade war and prevent the United States from catching the same cold that Europe, China and elsewhere seem to have.

The Fed’s announced a quarter-point cut a widely expected move to lower the benchmark U.S. interest rate from about 2.5 percent down to just shy of 2.25 percent. But the Fed seldom does just one cut, which is why Trump, Wall Street and much of the world will be listening closely to Powell for signs of when another cut is likely.

View the complete July 31 article by Heather Long on The Washington Post website here.

Advancing Economic Security for People With Disabilities

Center for American Progress logoOverview

In order to advance economic security for people with disabilities, policymakers must level the playing field for disabled workers while also guaranteeing access to housing, nutrition, and health care for those who are unable to work.

Introduction and summary

Author’s notes: This report is an update of a 2015 issue brief from the Center for American Progress titled “A Fair Shot for Workers with Disabilities.”1

The disability community is rapidly evolving to using identity-first language in place of person-first language. This is because it views disability as being a core component of identity, much like race and gender. Some members of the community, such as people with intellectual and developmental disabilities, prefer person-first language. In this report, the terms are used interchangeably. Continue reading “Advancing Economic Security for People With Disabilities”

US economy slows to 2.1 percent growth in second quarter

The Hill logoEconomic growth in the U.S. slowed in the second quarter of 2019 after a torrid start to the year, according to data released Friday by the Commerce Department.

U.S. gross domestic product (GDP) grew at an annualized rate of 2.1 percent between April and June, in line with expectations but well below the 3.1 percent growth-rate notched in the first three months of 2019.

The report showed signs of resilience for the U.S. economy as it stretches a record decade of expansion toward the 2020 presidential election. President Trump’s reelection chances could largely depend on the strength of the economy and if he succeeds in taking credit for it. 

View the complete July 26 article by Sylvan Lan on The Hill website here.

New Data Show Costly Trump Tax Cut Achieved Little

The most commonly heard refrain when Donald Trump and the GOP were seeking to pass some version of corporate tax reform went something like this: There are literally trillions of dollars trapped in offshore dollar deposits which, because of America’s uncompetitive tax rates, cannot be brought back home. Cut the corporate tax rate and get those dollars repatriated, thereby unleashing a flood of new job-creating investment in the process. Or so the pitch went.

It’s not new and has never really stood up to scrutiny. Yet virtually every single figure who lobbied for corporate tax reform has made a version of this argument. In the past, Congress couldn’t or wouldn’t take up the cause, but, desperate for a political win after the loss on health care, Trump and the GOP leadership ran with a recycled version of this argument, and Congress finally passed the Tax Cuts and Jobs Act on December 22, 2017. The headline feature was a cut in the official corporate tax rate from 35 percent to 21 percent. Continue reading “New Data Show Costly Trump Tax Cut Achieved Little”

Trump’s Investment Boom — And Other Economic Myths

What sort of machine is the economy? The common conception is that it’s a fragile and sensitive device, highly responsive to both good and bad government policies. Pessimists worry that one or two wrong moves from Washington will cause it to seize up. Optimists think the right change in tax or regulatory policy can supercharge it. The administration shares this general outlook.

Early in Donald Trump’s presidency, he and his economic advisers hailed what was coming. With Trump’s policies, declared Stephen Moore, “four percent growth can and should be the new normal in America.” After the president signed his big tax cut, Lawrence Kudlow said, “We’re on the front end of an investment boom.”

It was a nice fantasy. In 2017, real GDP grew by 2.2 percent; in 2018, it increased by 2.9 percent. In 2014 and 2015, under Barack Obama, the figures were 2.5 percent and 2.9 percent.

View the complete July 16 article by Steve Chapman on the National Memo website here.