Posts Tagged ‘U.S. economy’

Trump Backers Cheer Economic Agenda, Blame GOP for Setbacks

September 22, 2017

President’s responses on North Korea, white supremacist violence draw slightly lower rating

Image result for Donald Trump in Florida after hurricane, photos

By Valerie BauerleinArian Campo-Flores and Quint Forgey
The Wall Street Journal

As President Donald Trump approaches his 10th month in the White House, The Wall Street Journal revisited voters in six counties representing the economic underpinnings of his support. In each county, the Journal spoke to supporters, converts, abstainers and opponents to see how their economic situation is changing, and whether their expectations are being met.

Supporters of President Donald Trump generally approve of his overall performance on what they see as core issues such as jobs and taxes, and they blame Republicans in Congress for failing to support the White House agenda.

“I think he’s doing great,” said Emory Terensky, 66 years old, a former steelworker in Monessen, Pa. Similarly, Patti Thompson, who lives in the Phoenix-area retirement community of Sun City, said her support of the president hasn’t wavered, though she continues to be frustrated that “we can’t get Congress and Trump on the same page.” She puts the fault for that on congressional Republican leaders.

On a few issues, such as tensions with North Korea and clashes with white supremacists in the U.S., Mr. Trump received a slightly lower rating. “I’m very concerned about the North Koreans,” said John Golomb, 65, a former steelworker, in Monessen, Pa. “Is Donald Trump talk, or is he action? That’s the $64,000 question.”

Robert Lee, the 62-year-old owner of Rockingham Guns & Ammo in Richmond County, N.C., gives the president an overall grade of “B-minus, at best.” He is holding out hope that Mr. Trump will begin successfully working with Congress to get his agenda passed. “He is more intent on fighting,” Mr. Lee said. “You can’t fight all the time. You’ve got to step back away from it, take a look at the broader picture of what’s taking place and do something about it.”

Trump opponents, for the most part, remain angry, and, in some cases, disheartened, with his handling of several key issues over the past few months. Trish Collins, a 40-year-old human resources manager in Pinellas County, Fla., said she feels exhausted by the “roller coaster” of Mr. Trump’s presidency.

Rachel Kalenberg, 35, who voted for Gary Johnson, the Libertarian presidential candidate, said she hadn’t yet seen evidence of an economic boom in energy-rich Gillette, Wyo, where she owns a pizza shop. But she acknowledged that many people here still believe Mr. Trump’s support of the coal industry could ultimately mean more jobs and other good things. “I think Gillette is very hopeful, and we have seen a little bit of growth,” she said. “Maybe it’s not enough.”

Among Trump supporters, views were mixed on his response to the Confederate statue protests in Charlottesville, Va., which descended into a fatal confrontation. Some, including Mr. Lee in Richmond County, N.C., believe that Mr. Trump created unnecessary problems by blaming white nationalists for violent confrontations with counterprotesters in an Aug. 14 prepared speech, then saying there was “blame on both sides” in a news conference the next day at Trump Tower in New York.

“He added a little bit more to it than should’ve been added and that drove a wedge,” Mr. Lee said. “If you keep on tossing something into the wind, it’s going to blow back on you, and it did.”

But others, such as Earl Cassorla, 61, agreed with Mr. Trump’s stance, and blamed the media for not reporting his remarks accurately. “The president denounced white supremacists and neo-Nazis,” said Mr. Cassorla, co-owner of a fireworks shop in Battle Mountain, Nev. “The president said there were good people on both sides of the statue protest. The media responded that ‘No, there are no good Nazis.’ Fake news.”

Mr. Cassorla also agreed with Mr. Trump’s assertions in various tweets that removal of Confederate statues is wrong. In the case of Confederate Gen. Robert E. Lee, whose statue in Charlottesville was at the center of the Aug. 12 protest, Mr. Cassorla said the Southern war commander wasn’t the racist he has been portrayed to be.

“People were protesting the removal of a statue of Robert E. Lee, who fought for the rights of his state, despite his desire for the country to remain undivided,” he said. “Some opposing the removal of Lee’s statue were a fringe group of white supremacists. Additionally, some protesting were just people who simply opposed the removal of a historical statue.”

Jocelyn Golomb, a 20-year-old Monessen, Pa., store clerk, who voted for Hillary Clinton in November, said she has always hated Mr. Trump. But her contempt for the president reached new heights following his response to the violence in Charlottesville.

“He kind of didn’t really have anything to say until after he was pushed to say something, and that wasn’t right,” she said. “I don’t think he’ll ever have my support. Ever.”

Ms. Collins in Pinellas County, Fla., who voted for Mrs. Clinton, thinks Mr. Trump’s handling of the Charlottesville violence was abysmal. “If I had to guess what is the worst way to respond to this, he nearly hit it, ” she said. “It was terrifying to see that.” At the same time, “this is not a surprise,” she said. “He’s been saying racist things from the beginning of his campaign.”

Some Trump supporters, such as Curtis Chambers, a 54-year-old financial adviser, in Pinellas County, praised the way the president has handled the North Korea problem. “It is the question no one seems to have an answer for,” Mr. Chambers said.

“I think the Obama period was a period of appeasement,” Mr. Chambers said. “The Trump approach is different. It will be more confrontational, highlighted by his rhetoric. I feel like he’s being strong with North Korea. … I wish there was a better answer, but at least he’s standing up to [ Kim Jong Un].”

“It’s a tough situation,” said Steve Lang, a 54-year-old contingency planner in Pinellas County. He backs the way the president is working with allies such as Japan to try to contain the threat. “I don’t think the American people want us to go to war with North Korea.”

But Mr. Golomb, the former steelworker in Monessen, Pa., who feels more “cheated” than ever after voting for Mr. Trump in November 2016, fears a growing threat from Pyongyang that he believes is exacerbated by Mr. Trump’s bluster on social media.

“I’m very concerned about the North Koreans,” he said. “Is Donald Trump talk, or is he action? That’s the $64,000 question.”

To Ms. Collins, the Clinton voter, Mr. Trump’s handling of hostilities with North Korea has been unsettling. “He and Kim Jong Un are very similar in what they say to each other, and it’s terrifying to see our president saber-rattling,” she said. “I can’t see how his approach is making things better.” Moreover, she said, Mr. Trump is alienating key allies such as China that could help defuse the situation.

The president’s August speech on Afghanistan, in which he backed a continued commitment there despite a campaign pledge to quickly pull out, earned mixed reviews from his supporters.

“I don’t think putting more troops on the ground in Afghanistan is the answer,” said Samme Engelson, 40, owner of an embroidery shop in Battle Mountain, Nev., who voted for the president. “I worry about the counsel the president is getting as far as this ‘war’ is concerned. We have been there so long.”

But Mr. Lang, who also backed the president, said the president’s change of heart was a positive step. “He sounded like he listened to his generals,” he said.

John Golomb, the former steelworker from Monessen, Pa., who early into Mr. Trump’s presidency began to regret his Trump vote, was particularly worried about the shift in Afghanistan which he hopes “doesn’t turn into another Vietnam.”

Responses to Hurricanes Harvey and Irma split along partisan lines, even in Florida, where Irma did the most damage.

Mr. Chambers, a Trump supporter in Pinellas County, thinks Mr. Trump performed well in the wake of the recent hurricanes.

“He went there right away,” Mr. Chambers said. “That kind of hands-on leadership, and showing up at the front where the trouble is, is a morale booster to everybody.”

But Ms. Collins, the Clinton supporter from Pinellas County, faulted Mr. Trump’s response.

“It seemed pretty obvious on his first visit [to Texas] that he was there just to promote himself,” she said. She credited the Federal Emergency Management Agency’s mobilization of resources, but said “this is another example of the career government staffers around him doing the best they can.”

Outside the hurricane zone, reactions were similarly divided.

“The president has behaved in a most compassionate manner related to the victims of this terrible storm,” said Mr. Cassorla of Nevada.

But Ms. Golomb of Monessen, Pa., viewed the president’s trip to Corpus Christi, Texas, in late August as nothing more than a glorified photo opportunity. “He wasn’t talking about, ‘Oh, we have a natural disaster, ‘” she said. “He was talking about, ‘What a huge crowd.'”

The president’s moves on DACA won praise from supporters for his initial move to toss the topic into Congress’s lap, but became more divisive when he began negotiating directly with Democrats. The suggestion to press for a continuance of such protections for young immigrants is also in line with a majority of Americans, according to a Wall Street Journal/NBC News poll.

Ms. Engelson, of Battle Mountain, Nev., expressed concern about the president’s handling of DACA.

“I originally thought that the president did the right thing in canceling DACA in six months,” she said. “Let Congress do their job. Now I am a bit worried that he is going to sacrifice immigration law to advance other items in his agenda, such as repealing Obamacare and tax reform. If that happens, I think he will have done great damage to his political future and perhaps our country’s future.”

But some supporters were willing to cut him more slack.

https://www.wsj.com/articles/trump-backers-cheer-economic-agenda-blame-gop-for-setbacks-1506078002

(MORE TO FOLLOW) Dow Jones Newswires

September 22, 2017 07:14 ET (11:14 GMT)

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Iran Prepares for U.S. To Pull Out of Iran Nuclear Deal

September 13, 2017
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TEHRAN (FNA)- Geopolitical analyst James O’Neill says Washington will kill the nuclear agreement with Iran as part of its hawkish policy of threat to the country that is a heavy weight actor at the center stage of political equations and developments in the Middle East.

“Iran is uniquely placed to be a significant force for good in a volatile and rapidly changing region. It is this unique role that is a major reason why the US continues to make threats, uses proxy forces such as the Mojahedin-e Khalq (MEK) to destabilize Iran, and will undoubtedly resile from the Joint Comprehensive Plan of Action (JCPOA),” O’Neill said in an exclusive interview with FNA.

The analyst further added that the US animosity towards Iran has pushed the latter towards stronger ties with other world powers. “Iran’s growing links with China and Russia are its best defenses against US aggression,” he said.

James O’Neill is a geopolitical analyst and a former academic who since 1984 has practiced as a barrister, first in New Zealand and since 2002 in Australia. He has appeared on international media outlets such as RT and Press TV. He is also a regular contributor to “New Eastern Outlook,” an online expert opinion journal.

FNA has conducted an interview with James O’Neill to discuss Syria and its allies in the war on terrorist groups, the possible geopolitical implications for regional and trans-regional players and the geopolitical trends in the Middle-East.

Below you will find the full text of the interview.

Q: From time to time we have been hearing about the so-called US-led coalition and Israel coming to help the terrorist groups operating inside Syria, the financial support coming from the US and its allies and the ideological support from the Wahhabi regime in Saudi Arabia. Why do you think with all that support, these days we keep hearing about their proxy forces failing and losing ground in Syria?

A: The US, Israel and Saudi Arabia will continue to support terrorist groups in Syria while pretending to be “fighting terrorism”.  This is because they are pursuing disparate goals, not always mutually consistent. The Saudis want to spread their Wahhabi version of Islam; Israel wants to break its neighbors up into smaller States and also expand its own borders (the Yinon Plan); the US wants regime change to have a government that is compliant with its wider geopolitical goals, including using for example, Qatari gas to undermine Europe’s reliance upon Russian natural gas. Syria and its allies are better motivated, better equipped, and are also fighting as a unified force against a fragmented opposition.

Q: Addressing the opening of a Conference of Foreign Affairs and Expatriates, Syrian President Bashar al-Assad has hailed the political, economic and military support of Syria’s allies, namely Iran, Russia and Hezbollah. How much do you think this alliance has helped Syria to fight back terrorists?

A: The support of Hezbollah, Iran and Russia has been crucial to the success of the Syrian government’s fight against its enemies, both internal and external. The respective militaries are highly disciplined and have the support of the local population. We see that in the return of more than half a million refugees to their homes once ISIS and the other multiple terrorist groups have been defeated. Without the intervention of Syria’s allies, and particularly the Russian intervention after September 2015, it is highly likely that the Syrian government would have been defeated. That would have had catastrophic consequences not just for Syria but also the wider region, including the Russian Federation.

Q: What do you think would be the implications of such continued failure for American foreign policy?

A: One definition of insanity is to repeat the same thing over and over and expect a different result. The US is a classic example of this as they repeatedly make the same mistakes. In one sense they do not care, as long as they retain their hegemonic status. A major impetus for these endless wars is the huge “defense” industry. The “military-industrial-intelligence” complex makes a profit regardless of the outcome. In at least one sense, failure is a “win” because it creates conditions that lead to further demand for military expenditure to protect themselves (and their allies) from the consequences of their catastrophic foreign policy misadventures. Such policies eventually destroy the society from within, as we have seen countless times with empires in the past. They eventually collapse from the weight of their internal contradictions. Their ability to in effect use other people’s money to fight their wars will rapidly diminish as the dollar loses its status as the world’s sole reserve currency. This is occurring rapidly right now.

Q: How do you think that would change the geopolitics of the Middle East?

A: That is a huge question. The Middle East is not a single entity. There are disparate interests, only some of which are religious. The region has also been the victim in the past of interference by different colonial powers (France and the UK in particular) and more recently by the US. Its oil and gas wealth is both a blessing and a curse. As the younger generation emerges into positions of more influence they will demand changes. During the transition phase there will be profound disruption in some of those countries. The majority however increasingly see that their better future lies in more cooperation.  There are a number of pointers in this direction, for example with the development of a Middle Eastern economic grouping that will link in turn to the Belt and Road Initiative. Another encouraging sign is the discussions between Iran and Qatar on the development of the Pars gas field. The demise of the petrodollar is probably the biggest single geopolitical development on the horizon. How that plays out will depend in part on how the Americans react. Their history is not encouraging in that respect, but there are now countervailing geopolitical forces that they have not encountered in the past. China is easily the most important in this respect. Russia has shown through its involvement in Syria that it is a reliable friend that is not there to exploit Syria’s resources. It is significant in this regard that Iraq is now seeking Russian help. The two biggest improvements in the Middle East would be the settlement of the Palestinian issue; and for the Americans to pack their bags and go home. Neither is likely in the near future. The other developments that I see as encouraging as noted will occur anyway. Whether that is hard or easy will depend on whether America accepts the transition or tries to fight it.

Q: How do you see the role of Iran in the region?

A: Iran is a critical link in the transformation of Eurasia that is occurring under the influence of projects such as One Belt One Road (OBOR), North-South Transport Corridor (NSTC) and Shanghai Cooperation Organization (SCO). As one of the world’s oldest continuous civilizations, its resources (human and natural) and its geography, Iran is uniquely placed to be a significant force for good in a volatile and rapidly changing region. It is this unique role that is a major reason why the US continues to make threats, uses proxy forces such as the Mojahedin-e Khalq (MEK) to destabilize Iran, and will undoubtedly resile from the JCPOA. Iran’s growing links with China and Russia are its best defenses against US aggression.

http://en.farsnews.com/newstext.aspx?nn=13960607002091

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Manufacturing Sector Is the U.S. Economy’s Bright Spot

September 5, 2017

Sep 5, 2017 8:35 am ET

The U.S. economy isn’t all disappointments. Unlike a soft payrolls report for the month of August, a key gauge of manufacturing far surpassed expectations on Friday. The Institute for Supply Management said its index of factory activity climbed to 58.8 last month, its highest level since 2011 and well above economist expectations of 56.6. That […]

https://blogs.wsj.com/moneybeat/2017/09/05/manufacturing-sector-is-the-u-s-economys-bright-spot/

Emerson McKoy works at Alstrom Heat Transfer in the Bronx. Factory jobs have increased. Credit Scott Eells/Bloomberg News — FILE photo

Americans Are Happier at Work, But Expect a Lot Less

September 1, 2017

Job satisfaction is the highest in a decade, but years of layoffs, minimal raises and lean staffing have redefined what makes a position good

Image result for corporate workers, photos

Sept. 1, 2017 5:30 a.m. ET

Americans are happier at work, but they might just be settling for less.

For the first time since 2005, more than half of U.S. workers say they’re satisfied with their jobs, according to the Conference Board, a research group. Employment is up, wages are finally rising and layoffs are near record lows, resulting in a more optimistic, contented workforce.

 

That buoyancy is giving Americans confidence to pull out their wallets. Consumer spending has risen every month this year, with a strong pickup in August, and the U.S. economy grew in the second quarter at its fastest pace in more than two years.

Yet the data also suggest U.S. workers have changing views of what makes a job good, and a decade of bruising job cuts, minimal raises and lean staffing has led them to lower their expectations, economists and labor-market experts say.

The average employee today shoulders more risk for her retirement and health care than in past generations, and enjoys less job security as the idea of a job for life has vanished. The traditional bond between employer and employee — in which companies provided job and retirement security in exchange for hard work and loyalty — has eroded so much that young workers today “don’t even know what they’re missing,” says Rick Wartzman, a management expert and author of “The End of Loyalty: The Rise and Fall of Good Jobs in America,” released in May by PublicAffairs.

Almost 51% of employees say they are very satisfied or somewhat satisfied with their jobs, according to the Conference Board, which surveyed about 1,600 workers across the U.S. last November on various aspects of their work. Workers gave top ranking to their colleagues, commutes and job tasks, but were frustrated with companies’ promotion policies, bonus plans, training opportunities and performance-review processes.

American workers remain scarred by the Great Recession, which reset expectations for a whole generation, says Peter Cappelli, a management professor at the University of Pennsylvania’s Wharton School of Business.

Unemployment reached a 25-year high of 10% in 2009, sending record numbers of Americans into long stretches of joblessness. Those who did remain in jobs were asked to do more with less, for smaller rewards.

“In the dot-com period, we had M.B.A. students who literally were expecting to be millionaires within two or three years,” Mr. Cappelli says, referring to the late-1990s tech bubble. “After 2009, we had people who were just glad to get any kind of job.”

Now, with unemployment at 4.3% and wages showing signs of lifting, workers are feeling greater peace of mind and fulfillment than they have in years, finding roles in line with their skills and ambitions.

Mechanical engineer David Hunt was let go from an engineering job in 2012 and spent the next five years unemployed or working short-term contracts, including a stint as a salesperson at a Lowe’s Cos. store.

When Mr. Hunt, who holds two master’s degrees, was offered a job at a Boston-area high-tech company in June, the firm’s human-resources manager called him with good news and bad news about his salary. Mr. Hunt, 52 years old, asked for the bad first.

We can’t pay what you asked for, the manager told Mr. Hunt. Instead, the company offered 10% above that number.

Mr. Hunt now earns enough to support his family while his wife pursues a Ph.D., and says he feels his ideas are valued. For the first time in years, he says, he’s excited to go to work each day.

Worker satisfaction is mixed but improving in areas like wages and job security. Just over 52% of workers feel safe from a layoff, up six percentage points from 2011, and 41.6% say they are pleased with their wages, up from 36.1% five years earlier, according to Conference Board.

Average hourly earnings are growing at a slow pace by historical standards — rising 2.5% from July 2016 to July 2017 — but low inflation means paychecks are buying more and workers are feeling more flush.

After starting a new job as a business process analyst with an automotive supplier in May, Peter Bynarowicz, 24, was impressed to discover free coffee — regular, flavored and decaf — on every floor. “That stood out to me,” he says, adding that his previous job had sparse perks.

The new job also came with a 20% salary increase and promises of growth. During a job interview, his manager told him, “I won’t let you be in this position for two years. I want you to grow,” recalls Mr. Bynarowicz, of Greenville, S.C.

Amid a continuing shift away from pensions toward 401(k) plans with unpredictable returns, satisfaction with retirement plans rose from 35% to 37.3% from 2011 to 2016, the Conference Board says, possibly reflecting higher 401(k) returns from stock investments.

Overall, Americans’ sense of retirement security has dropped. In 1993, 73% of U.S. workers felt confident they could afford a comfortable retirement, according to the Employee Benefits Research Institute. In 2017, 60% felt that way.

Also falling in workers’ esteem are health-insurance and family-leave plans. Employees are paying more for health care and coping with higher deductibles. And though some employers have enriched parental-leave benefits for white-collar workers, U.S. working parents get less leave than their counterparts in other industrialized nations.

Haley O’Donnell, 33, was a manager in the corporate office of a Fortune 500 retailer a few years ago when one of her employees became a father. The company offered no paid paternity leave, and Ms. O’Donnell sent an angry letter to the chief executive. She never received a response.

Following a career switch, Ms. O’Donnell wrote a young-adult novel and now works part time as a writer for Armstrong & Associates, Inc., a logistics consulting firm in Milwaukee. She recently had her first child and has eight weeks’ paid maternity leave, a rare benefit for part-timers.

Ms. O’Donnell contrasts her career path with that of her father, who worked in the same corporation for more than two decades. “You go into the world expecting it to be like it was,” she says. “You learn the hard way when you’re paying out-of-pocket for health insurance.”

Write to Lauren Weber at lauren.weber@wsj.com

https://www.wsj.com/articles/americans-are-happier-at-work-but-expect-a-lot-less-1504258201

U.S. economic growth hits 3% rate in second quarter

August 30, 2017

Q2 GDP revised up from initial estimate of 2.6% on stronger consumer spending

By GREG ROBB

SENIOR ECONOMICS REPORTER
Getty Images
A woman carries retail shopping bags in New York City.

WASHINGTON (MarketWatch) — The U.S. economic rebound in the second quarter was stronger than initially reported, as a lift to consumer spending and business investment led to the strongest growth in more than two years.

Gross domestic product rose at 3% rate from April to June, up from an initial 2.6% reading, the Commerce Department said Wednesday.

Economists surveyed by MarketWatch expected a smaller upward revision in second-quarter GDP to a 2.8% rate.

The economy picked up from a 1.2% rate in the first quarter. A slow first quarter followed by an improved second quarter also occurred in two of the past three years. Economists say that the most recent data suggest the U.S. is on track to maintain a 3%-plus clip in the third quarter.

The last time the U.S. economy had two quarters above 3% was in 2014.

President Donald Trump is relying on growth above 3% to generate enough revenue for the government to pay for tax cuts and more infrastructure spending.

Consumer spending was the main engine for the strength in the second quarter, rising a revised 3.3% in the second quarter. That was up from the government’s original estimate of a 1.9% gain. Americans spent more on goods and services, including car purchases.

Outlays of business investment rose at a revised 0.6% clip in the second quarter, up from a prior 0.4% estimate.

The government reported that corporate adjusted pretax profits were up 6.7% over the past year, despite falling at a 0.5% quarterly rate in the second quarter.

The report also confirms that inflation has moved away from the Federal Reserve’s 2% annual target in the second quarter.

Inflation as measured by the Fed’s preferred PCE price index decelerated to a 1.6% annual pace in the quarter, down from a 2% rate in the first quarter.

Core PCE slumped to a 1.5% rate from a 1.8% rate in the prior three months.

Soft inflation is raising questions over whether the Fed will go ahead with another interest-rate hike this year. The central bank had penciled in three hikes this year and has already engineered two hikes in the first half of the year.

U.S. futures pointed to a higher opening for the Dow Jones Industrial AverageDJIA, +0.02%   in the wake of the GDP report, as well as another showing brisk jobs growth in August.

Read: Private-sector job growth surges in August, ADP says

US economy grew 3% in second quarter: Commerce Dept — Fastest pace in more than two years

August 30, 2017

AFP

© AFP/File | The US economy grew at its fastest pace in more than two years in the second quarter, much faster than initially estimated, official data

WASHINGTON (AFP) – The US economy grew at its fastest pace in more than two years in the second quarter, much faster than initially estimated, official data showed Wednesday.

Hitting the White House growth target for the first time in Donald Trump’s presidency, Gross Domestic Product (GDP) increased three percent in the April-June period, the Commerce Department reported.

The figure was revised up by an unusually-large four tenths from the growth estimate published last month, due to higher consumer spending and business investment than in the initial report.

The rate surpassed analyst expectations, which called for an increase of 2.7 percent.

But growth in the first half of the year was just 2.1 percent, still below the 2.2 percent average recorded over the last three years.

The Trump administration has pledged to return the world’s largest economy to sustained annual growth of three percent or more by slashing taxes and regulations while boosting trade.

Economists have said this may be unrealistic and Trump’s growth agenda remains stalled in Congress.

Trump has alienated members of his own party, who face bruising battles next month over borrowing authority, adopting a budget and approving reconstruction aid for areas battered by Hurricane Harvey.

This second GDP estimate for the second quarter, which remains subject to revision, reflected higher sales of durable goods such as autos — a sector which has struggled in the first half of the year after a record 2016.

The new figures also showed higher business spending on intellectual property products like computer software.

The faster growth rate could relieve the pressure on the Federal Reserve which has been divided over the course of monetary policy in recent months.

The central bank has raised interest rates twice this year but some market players doubt the Fed will hike a third time by December in light of persistently weak inflation.

The Fed has written off the low price pressures as merely “idiosyncratic” or “transitory” blips on the radar and the stronger second quarter could lend weight to this view.

Trump to promote ‘vision’ for job creation via tax overhaul

August 30, 2017

By  CATHERINE LUCEY and JOSH BOAK
The Associated Press

WASHINGTON (AP) — President Donald Trump will kick off his lobbying effort for a tax overhaul at an event with a Midwestern manufacturing backdrop and some economic tough talk.

The one thing missing? A detailed proposal.

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President Donald Trump (AP Photo/Pablo Martinez Monsivais)

Instead, in Springfield, Missouri, Wednesday, Trump will give remarks that the White House said will focus on his “vision” for spurring job creation and economic growth by cutting rates and revising the tax code. Details will come later, officials said, when lawmakers work them out.

After a year with no major legislative wins, the stakes are high for the White House and GOP leaders, who face mounting pressure to get points on the board before next year’s midterm elections. Complicating matters, the tax push comes amid an intense September workload that requires Congress to act by month’s end to fund the government and raise the debt limit, as well as pass emergency spending for the Harvey disaster.

After failing to deliver on seven years of promises to repeal and replace Obamacare, many Republicans believe they must produce on taxes or face a reckoning in next year’s congressional midterm elections. If they don’t have something to show for full control of Congress and the White House, voters could try to take it all away, beginning with the GOP’s House majority.

On Twitter Sunday, Trump previewed his trip, stressing the politics. Calling Missouri a “wonderful state,” he said the state’s Democratic Sen. Claire McCaskill — up for re-election next year — is “opposed to big tax cuts” and said a “Republican will win” the state.

Trump is kicking the effort off in Springfield, considered the birthplace of the historic Route 66 highway, known as “America’s Main Street.” Emphasizing domestic jobs, he’s appearing at the Loren Cook Company, which manufactures fans, gravity vents, laboratory exhaust systems and energy recovery ventilators.

A key challenge is to frame a tax plan that could include cuts for corporations and top earners as a boon for the middle class. Officials suggested Trump would argue that cutting business taxes will benefit American companies and workers. The remarks were drafted by Trump policy adviser Stephen Miller with the speechwriting team, under Trump’s guidance, the White House said.

Trump will be joined by Treasury Secretary Steven Mnuchin, Commerce Secretary Wilbur Ross, Gary Cohn, director of the National Economic Council, and Small Business Administrator Linda McMahon, said the White House. Also expected are Missouri elected officials, including Sen. Roy Blunt and Gov. Eric Greitens, as well as local business owners.

Trump is expected to continue his sales pitch and Republicans are hoping the president commits in a way he never did for health care.

“If you’re a Republican, you have to be encouraged by the president’s recent focus on tax reform,” said Brian McGuire, former chief of staff to Senate Majority Leader Mitch McConnell. “Not only does presidential leadership make the chances of success here far more likely, it could also very well be the difference between Donald Trump presiding over a jobs boom and Nancy Pelosi presiding over an impeachment trial.”

But in order to clear their other priorities and focus to rewriting the tax code, Congress will need a steady partner in the White House, something that’s been sorely lacking from Trump thus far. If the president chooses to renew fights with key lawmakers like McConnell or double down on contentious issues like funding his border wall, which he’s already threatened to shut down the government to achieve, that could only hurt chances of reaching success on taxes.

“He’s a liability,” said Republican consultant Rick Tyler. “He proved that in the whole health care repeal and replace. He just can’t stay focused on one thing.”

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Senate Majority Leader Mitch McConnell (Photo by T.J. Kirkpatrick/Getty Images)

The Trump administration released a one-page set of goals in April, followed by a joint statement in July with congressional leaders. In an interview with the Financial Times last week, Cohn said the White House and GOP leaders have agreed on a “good skeleton” for a tax overhaul, and said the House tax-writing committee would be drafting legislation while the White House tries to sell the plan.

Republican House Speaker Paul Ryan touted tax reform efforts during an appearance in suburban Seattle last week. He pledged to simplify the code, calling it “the worst, the least competitive tax system in the industrialized world.”

White House officials declined to discuss details Tuesday. Trump has promised the largest tax cut ever, saying he’d like to see the corporate tax rate drop from a top tax rate of 35 percent to a top rate of 15 percent. But it’s not clear if it will end up being that low in the plan. It is also not clear what kind of break a typical taxpayer will see.

Cohn told the Financial Times a bill could be passed in the House and Senate in 2017, pushing back the administration’s timetable for a bill to reach the president’s desk. The White House had said previously that it expected final passage in November.

Cohn said that if Democrats are not interested in working together, they will pursue legislation using a maneuver that only requires Republican votes.

Democrats have already gone on the attack. Democratic House Minority Leader Nancy Pelosi said on Twitter recently that House Speaker Paul Ryan’s “tax plan is not reform — it’s a tax cut for billionaires.”

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AP Congressional Correspondent Erica Werner contributed to this report.

US business economists fret over Trump policy agenda

August 21, 2017

AFP

© AFP/File / by Heather SCOTT | US business economists worry about the prospects for President Donald Trump’s policy agenda, and the potential damage to the economy from his trade and immigration policies
WASHINGTON (AFP) – US business economists worry about the prospects for President Donald Trump’s policy agenda, and the potential damage to the economy from his trade and immigration policies, according to a survey released on Monday.The survey findings add to Trump’s accelerating alienation with the business community. CEOs fled his advisory councils last week to distance themselves from his both-sides-are-to- blame response to a white supremacist rally in Virginia in which one woman among a group of counter-protesters was killed.

Although the survey was completed more than a week prior to the those events, they reflect growing concerns among businesses that had been cheered since the election about the possibility of seeing tax reform and infrastructure spending that could boost the economy.

“I do think that is some of the concern, that everything that has transpired recently, especially over last week, may impair the administration’s ability to get its legislative agenda passed,” said Frank Nothaft, a policy analyst with the National Association for Business Economics.

Stressing that he was not speaking for the NABE panelists in the semi-annual policy survey, Nothaft told AFP that the administration has a number of very important legislative proposals that could stimulate growth and boost spending.

However, “with everything that’s transpired it puts that legislative agenda at jeopardy. Will anything get passed?”

While the survey showed most economists judge fiscal policy to be “about right” currently, they “quite pessimistic about prospects for ‘meaningful, revenue-neutral tax reform’ in the near term,” the survey showed.

– ‘Unfavorable scores’ –

Conducted July 18 to August 2 with 184 members, the survey showed only a 10 percent probability of such legislation this year and a 15 percent (median) probability of passage in 2018.

Over half the respondents said tax reform could add less than one percentage point to real GDP growth over the next 10 years, while a third put the impact on growth at between one and two percentage points.

Business economists also worry about the “unfavorable consequences” of Trump’s trade an immigration policies.

In those areas “survey participants give the administration unfavorable scores,” said NABE Policy Survey Chair Richard DeKaser, who also is executive vice president and corporate economist at Wells Fargo.

Nothaft, chief economist at CoreLogic, explained that anything that clouds the environment for businesses to make investment decisions, whether for exports or imports, can cause firms to delay spending and impact the economy.

When policies are “in flux and the environment can change dramatically, companies may hold back,” he said, noting that “investment is an important part of GDP and economic growth.”

Meanwhile, restrictions on immigration hurt companies that are having trouble finding workers, notably in homebuilding and high-tech.

– Yellen out –

On monetary policy, Nothaft said the survey shows economists now have a “much stronger belief” compared to six months ago that the Federal Reserve will raise the benchmark interest rate one more time this year.

While 61 percent said monetary policy was “about right,” 53 percent are expecting a third rate hike, NABE said, although there is less agreement about next year.

In contrast, market economists have become increasingly doubtful about the prospects for another move, which was expected in December, given persistently low inflation even amid historically low unemployment rates. Even central bankers are divided about how fast to move rates.

However, 67 percent expect Trump to replace Fed Chair Janet Yellen when her four-year term ends February 3.

About half expect White House economic adviser Gary Cohn to replace her, although the survey was completed before this week’s rumors — denied by the White House — that Cohn was planning to resign.

Meanwhile, most economists see only a 10 percent chance Congress will fail to take action to raise or suspend the limit on government borrowing, before the US defaults on its debts. The government is expected to hit the debt ceiling in mid October.

by Heather SCOTT
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Trump Will Get His Tax Cuts, Vast Majority of Economists Say

August 14, 2017

Bloomberg News

By Rich Miller and Catarina Saraiva

August 14, 2017, 4:00 AM EDT
  • Yet survey suggests the impact on economy will be limited
  • Fed seen raising interest rates, which may blunt stimulus

Rep. Brady Says on Track to Deliver Tax Bill This Year

The pros who make their living forecasting the economy overwhelmingly expect President Donald Trump and his fellow Republicans to push through tax cuts in time for next year’s congressional elections. They just don’t think that the reductions will do all that much to help the economy in 2018.

That’s the message from the latest Bloomberg monthly poll of economists, taken Aug. 4 to Aug. 9. Of 38 respondents, 29 expect Congress to pass tax-cut legislation by November 2018. The policy changes though are only expected to add 0.2 percentage point to the pace of gross domestic product expansion in 2018, according to the median figure from analysts penciling in an impact.

The Bloomberg survey forecasts growth in 2018 to be only slightly higher than this year — 2.3 percent versus 2.1 percent, according to median projections from a broader pool of 71 economists. What’s more, analysts see the economy losing momentum in 2019, with expansion falling back to 2 percent, contrasting with the Trump administration’s forecast of a further pickup.

“I think they’ll do something and it will probably be somewhat stimulative in the short run,” said High Frequency Economics Chief U.S. Economist Jim O’Sullivan, referring to Trump and Congress. “I don’t expect a huge impact from it.”

Cuts to individual and corporate rates would fall short of what GOP leaders and the Trump administration have promised — a once-in-a-generation permanent overhaul of the U.S. tax code, similar to what happened in 1986 under former President Ronald Reagan. If Republicans use a budget procedure for a tax bill to bypass Democratic opposition in the Senate, cuts would have to expire if they add to the long-term federal deficit.

First Half

The administration is betting that a mixture of corporate and individual tax cuts, along with other tax code changes, will eventually help lift annual economic growth to 3 percent, from the 2.1 percent average rate of the last eight years. In the first half of 2017, coinciding with Trump’s first six months in office, output rose at a 1.9 percent annual pace.

In order to win passage of a sweeping tax plan, the administration is holding a weekly, all-hands-on-deck meeting to coordinate strategy between the president and his allies, according to White House officials. The intensive discussions contrast with the at times haphazard approach the administration took in its failed attempt to repeal former President Barack Obama’s health-care law.

White House officials have said they’re still committed to a permanent tax revamp, and the plan is to start hearings and a markup of a tax bill after Labor Day so a version can get through the House in October and the Senate in November. Trump and Senate Majority Leader Mitch McConnell have sparred in recent days over the amount of time needed to pass complicated legislation, such as repealing and replacing Obamacare.

Trump officials see their policies accelerating GDP growth to 2.7 percent in 2019, on its way to 3 percent within the following two years. Economists beg to differ.

“The type of stimulus being talked about is temporary,” said Nariman Behravesh, chief economist at consultants IHS Inc. “It won’t deliver a sustained increase in growth.”

Texas Representative Kevin Brady, the Republican chairman of the House Ways and Means Committee, said Friday that Congress is on track to deliver a tax bill to Trump in 2017. Brady, in a Bloomberg Television interview, acknowledged the goal is “aggressive” but said there’s “urgency” in terms of the economy and U.S. competitiveness.

Fed Action

As the administration aims to add fuel to the economy, the Federal Reserve is expected to be withdrawing it, according to the poll. Economists forecast that the central bank will raise interest rates once more this year and three times in 2018, each time by a quarter percentage point.

That’s in line with Fed policy makers’ own projections but significantly below levels implied in financial markets.

“To keep the economy on a sustainable path of growth, we need to gradually reduce the monetary stimulus put in place during the recession and recovery,” San Francisco Fed President John Williams said in an Aug. 2 speech in Las Vegas. “If we delay too long, the economy will eventually overheat, causing inflation or other imbalances to emerge.”

Policy makers last increased borrowing costs in June, when they boosted the target range for the inter-bank federal funds rate to a range of 1 percent to 1.25 percent.

https://www.bloomberg.com/news/articles/2017-08-14/trump-will-get-his-tax-cuts-vast-majority-of-economists-believe

U.S. Economy Added 209,000 Jobs in July — Dow hits fresh record high

August 4, 2017
Aug 4, 2017 at 9:46 am ET

U.S. employers added a seasonally adjusted 209,000 jobs in July. The unemployment rate fell to 4.3%. Economists surveyed by The Wall Street Journal expected employers to add 180,000 jobs and unemployment to tick down to 4.3%.

This month, we’re also testing a new type of notification as part of our live coverage. Tell us what you think in our short survey.

http://www.wsj.com/livecoverage/july-jobs-report-labor-employment-analysis

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US created 209,000 jobs in July, vs 183,000 jobs expected

  • The U.S. economy added 209,000 jobs in July and the unemployment rate dipped to 4.3 percent, according to a government report Friday.
  • The report comes with the economy at a crossroads as President Trump has promised 3 percent economic growth.
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The U.S. economy continued a strong summer, adding 209,000 jobs in July while the unemployment rate fell to 4.3 percent, the lowest since March 2001, according to a government report Friday.

Economists surveyed by Reuters had expected the report to show growth of 183,000; the unemployment rate met expectations. A more encompassing rate that includes discouraged workers and the underemployed was unchanged at 8.6 percent.

The number of employed Americans hit a new high of 153.5 million thanks to a surge of 345,000. The employment-to-population ratio also moved up to 60.2 percent, its highest level since February 2009.

Stock market futures liked the news, rising to indicate a positive open, while government bond yields also moved considerably higher.

“Kind of an all-around strong headline number,” said Tony Bedikian, head of global markets for Citizens Bank. “More people are coming into the labor force and finding jobs. It’s difficult to find anything really negative in the report.”

The closely watched wage number was unchanged from previous months, with average hourly earnings up 2.5 percent on an annualized basis. The average work week also was unchanged at 34.5 hours.

Bars and restaurants provided the biggest boost for the month with 53,000 more positives, while professional and business services contributed 49,000, the Bureau of Labor Statistics said.

In addition to the strong July report, June’s 222,000 gain was revised up to 231,000 though May was cut from 152,000 to 145,000.

Significant job gains also came from health care, with 39,000.

“This is an unambiguously positive jobs report, as it suggests that consumers will have the wherewithal to increase spending (with solid job gains and faster wage growth) and that inflation may be slowly pushed higher by tighter labor and product markets,” said David Berson, chief economist at Nationwide.

If there was a blemish in the month’s numbers, it came from the distribution of jobs to lower-income sectors. Job creation was strongly titled to part-time, which gained 393,000 positions, while full-time fell by 54,000.

Those counted as not in the labor force fell by 156,000 to 94.7 million while the labor force itself surged by 349,000 to 160.5 million.

The report comes with the economy at a crossroads. While job gains have continued apace during the Trump administration, wage increases have remained tepid as the president has promised growth closer to 3 percent than the average 1.9 percent so far this year.

President Donald Trump was quick to react, praising the numbers as indicative of stronger growth.

Excellent Jobs Numbers just released – and I have only just begun. Many job stifling regulations continue to fall. Movement back to USA!

In addition, the Federal Reserve is watching the numbers closely, particularly for wage increases. The central bank has indicated it plans one more interest rate hike this year as well as the beginning of its program to unwind the bond portfolio it accrued while trying to stimulate the economy out of the financial crisis.

Indeed, traders increased the chances that the Fed moves again before the end of 2017. Chances of a move at the December meeting are now just above 50 percent.

“If the labor market continues to tighten over the coming months, as the survey evidence suggests it will, the Fed will press ahead with rate hikes and balance sheet normalization later this year,” said Michael Pearce, U.S. economist at Capital Economics.

https://www.cnbc.com/2017/08/04/us-nonfarm-payrolls-july-2017.html

Get the market reaction here.

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“This is a Goldilocks report for the markets,” said Michael Gapen, chief United States economist at Barclays, meaning it was neither discouraging nor overheated. Citing the healthy payroll growth and steady gain in average hourly earnings in July, he added, “It really bodes well for macroeconomic growth.”

Indeed, stocks were higher in early trading after the release of the report, an indication Wall Street could post fresh records Friday. On Wednesday, the Dow Jones industrial average crossed the 22,000 mark for the first time.

Economists had been expecting a gain of 180,000 jobs, so the actual data is a sign that the economy is growing faster than other indicators had suggested.

Dow hits fresh record high

30m ago09:31

NFP: Low-paid jobs lead the way

43m ago09:18