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      US treasury secretary denies Trump tariffs are tax on Americans

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      US treasury secretary Scott Bessent has refused to acknowledge that the sweeping trade tariffs imposed by Donald Trump around the world are taxes on Americans.In a new interview on Sunday with NBC host Kristen Welker, Bessent, a former billionaire hedge fund manager, dismissed concerns from major American companies including John Deere, Nike and Black and Decker who have all said that Trump’s tariffs policy will cost them billions of dollars annually.Addressing Welker, Bessent said: “You’re taking these from earnings calls, and on earnings calls, they have to give the draconian scenario. There aren’t companies coming out and saying, ‘Oh, because of the tariffs, we’re doing this.’”He went on to add: “If things are so bad, why was the GDP 3.3%? Why is the stock market at a new high? Because, you know, with President Trump, we care both about big companies and small companies.”As concerns continue to grow over American companies trying to pass on the cost of US tariffs on to everyday Americans, Welker asked: “Do you acknowledge that these tariffs are attacks on American consumers?” To which Bessent replied: “No, I don’t.”Bessent’s latest interview follows a ruling by a federal appeals court which found that Trump had overstepped his presidential authority when he imposed sweeping tariffs on dozens of countries earlier this year that sent shockwaves across global markets.The tariffs established a 10% baseline for nearly all of the US’s trading partners. Trump also imposed so-called “reciprocal” tariffs imposed on countries that he accused of unfairly treating the US in trade. Lesotho, a south African nation of 2.3 million people faced a 50% tariff, while Trump also imposed a 10% tariff on a group of uninhabited islands home to penguins near Antarctica.In response to the federal appeals court’s decision, the Trump administration has recently asked the US supreme court to overturn the ruling.Speaking on whether the Trump administration would be prepared to offer rebates if the supreme court rules against the administration, Bessent said: “We would have to give a refund on about half the tariffs which would be terrible for the treasury… There’s no ‘be prepared.’ If the court says it, we’d have to do it.”Nevertheless, Bessent remained confident that the conservative-majority supreme court would side with the Trump administration, saying: “I am confident that we will win at the supreme court. But there are numerous other avenues that we can take. They diminish president Trump’s negotiating position … This isn’t about the dollars. This is about balance. The dollars are an after amount.”Bessent’s comments also came on the heels of newly released data from the Bureau of Labor Statistics which revealed that in August, 12,000 manufacturing jobs were lost, marking a total loss of 42,000 jobs since April when Trump made his tariff announcement.“Are these numbers proof that the tariffs are failing to produce the manufacturing jobs that President Trump promised?” Welker asked Bessent, to which he replied: “It’s been a couple of months. And with the manufacturing sector … we can’t snap our fingers and have factories built.”Bessent went on to add that he believes “by the fourth quarter, we’re going to see a substantial acceleration”.In addition to a decline in manufacturing employment since April, job openings and hires have fallen by 76,000 and 18,000, respectively, according to the Center for American Progress.According to economists, Trump’s tariffs are expected to cost American households $2,400 annually while wage growth among manufacturing workers remain stagnant under the tariffs.In August, manufacturing workers earned an hourly average of $35.50, marking only a 10-cent increase from July, the center reported. More

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      Donald Trump maelstrom likely to leave US economic model unrecognisable | Heather Stewart

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      Donald Trump observed blithely last week that if his cherished tariff regime is struck down by the US supreme court, he may need to “unwind” some of the trade deals struck since he declared “liberation day” in April.It was a reminder, as if it were needed, that nothing about Trump’s economic policy is set in stone. Not only does the ageing president alter his demands on a whim, but it is unclear to what extent he has the power to make them stick.Yet even if the “reciprocal” tariffs first announced on 2 April are rolled back, they are only one aspect of a much wider assault on the last vestiges of what was once known as the “Washington consensus”.To name just a few of Trump’s recent interventions, he has taken a 10% government stake in the US tech company Intel, demanded 15% of the revenue of Nvidia’s chip sales to China and suggested the chief executive of Goldman Sachs should go.This at the same as taking a sledgehammer to Federal Reserve independence by lobbing insults at the chair, Jerome Powell, and trying to sack Lisa Cook from the central bank’s board.The head of the Bureau of Labor Statistics was removed by Trump after a run of poor jobs data; the chief of the National Labor Relations Board, Jennifer Abruzzo, was fired, too.The tech bros who back Trump loathe the NLRB for its role in upholding workers’ rights – mandating unionisation ballots at Amazon warehouses, for example.Trump’s approach is simultaneously systematic, in its determination to smash existing norms, and utterly chaotic. It is hard to categorise: corporate America is being unleashed – through the wilful destruction of environmental and labour standards, for example – and brought to heel.The leftwing senator Bernie Sanders welcomed Trump’s efforts to take a stake in Intel in exchange for government grants, for example – something he advocated in the Guardian back in 2022 – while some Republicans have condemned the approach as (heaven forbid) “socialism”.Partly because it coincides with the AI-fuelled stock boom that has propelled the value of tech companies into the stratosphere, the market response to this torching of the status quo has so far been modest.Whatever emerges from another three and a half years of this maelstrom is likely to be unrecognisable as the US economic model of recent decades.Its destruction has not happened overnight. The days were already long gone when the US, as the world’s undisputed economic superpower, could export free market, financialised capitalism worldwide.After the 2008 crash, the conditions for which were created in Wall Street boardrooms, any moral or practical claim the US had to offer an economic example to other nations evaporated.As the turmoil rippled out through the global economy, and the US government responded by bailing out large chunks of its financial sector, the lie of laissez-faire was laid bare.The crisis exposed the risks of turbocharged capitalism to countries outside the US, too – not least in the former Soviet bloc – that had been advised to adopt the model wholesale.As Ivan Krastev and Stephen Holmes put it in their compelling polemic The Light that Failed, “confidence that the political economy of the west was a model for the future of mankind had been linked to the belief that western elites knew what they were doing. Suddenly it was obvious that they didn’t.”skip past newsletter promotionafter newsletter promotionBack home in the US, meanwhile – as in the UK – the perception that banks had been bailed out, while the galaxy brains behind the crisis got off scot-free, sowed the seeds of a corrosive sense of injustice.Similarly, even before the crash, the idea that ever-expanding free trade brings economic benefits was bumping up against the fact that even if that is true in aggregate, for workers across the US rust belt, just as in the UK’s former manufacturing heartlands, it brought deindustrialisation and unemployment.This was fertile ground for Trump’s populist economic message. His first-term China tariffs were, with hindsight, a relatively modest stab at, as he saw it, tilting the playing field back towards the US.Joe Biden did not unwind those tariffs, which went with the grain of geopolitics, as any hopes that economic liberalisation would bring China into the fold of democracies were sadly dashed, and President Xi’s regime took on an increasingly authoritarian bent.Biden also took a muscular approach to the state’s role in the economy, with the billions in grants and loans distributed under the Inflation Reduction Act linked to national priorities of cutting carbon emissions and creating jobs.So the idea that before Trump arrived on the scene, free market US capitalism was motoring along unchallenged is misleading, but the pace at which he is crushing its remaining norms is extraordinary.There is ample ground for legitimate disagreement here: taxpayer stakes in strategic companies are much more common in European economies, for example. Trump may be laying down tracks that future US governments with different priorities could follow.Given that it is so unclear even what kind of economy he is groping towards, the overriding sense for the moment is of radical uncertainty. Friday’s weak US payrolls data, with the unemployment rate close to a four-year high, suggested companies may be responding with caution.Investors appear to have decided to avert their eyes for now, buoyed up by the prospect of Fed rate cuts, and the mega returns of the tech companies. However, with every chaotic week that passes, the risks must increase – and as the UK has learned in the wake of the Liz Truss debacle, economic credibility is quicker to lose than to rebuild. More

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      US justice department reportedly opens criminal inquiry into Fed governor Lisa Cook

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      The US justice department has initiated a criminal investigation into mortgage fraud claims against Federal Reserve governor Lisa Cook, according to new reports, as a lawsuit she filed against Donald Trump over her firing makes its way through court.Lawyers with the justice department have issued subpoenas for the investigation, according to the Wall Street Journal.Last month, Trump moved to fire Cook over unconfirmed claims that she listed two properties as her primary residence. Bill Pulte, the director of the Federal Housing and Finance Agency and a close ally of Trump, alleged Cook had lied on bank documents and records to obtain a better mortgage rate.Cook, a voting member of the Fed board that sets interest rates, said she has “no intention of being bullied to step down” and that she would “take any questions about my financial history seriously”.In response to Trump’s bid to dismiss her, Cook filed a lawsuit against the president arguing that her removal was unconstitutional and threatened the independence of the Fed. Cook’s lawyers say the firing was “unprecedented and illegal” and that federal law requires showing “cause” for a Fed governor’s removal.“An unsubstantiated allegation about private mortgage applications submitted by Governor Cook prior to her Senate confirmation is not [cause],” her lawyers said in court documents.In court documents, lawyers for Cook suggested that a “clerical error” may be behind the discrepancies found in her mortgage records.Cook was appointed by Joe Biden in 2022 for a 14-year term on the board that was set to end in 2038. She is the first Black woman to be appointed to the board.US district court judge Jia Cobb heard arguments for the lawsuit last week and said she will expedite the case, which is ultimately expected to be taken up by the US supreme court.Trump’s attacks against Cook come against the backdrop of a long fight the White House has waged against the Fed, which has historically been treated as nonpartisan.skip past newsletter promotionafter newsletter promotionEarlier in the year, Trump threatened to fire the Fed chair, Jerome Powell, for not lowering interest rates, but ultimately walked back his threats after negative responses from investors. Trump also tried to accuse Powell of fraud over renovations at the Fed’s headquarters, which have cost more than anticipated.Abbe Lowell, Cook’s lawyer, told the Journal that “it takes nothing for this DoJ to undertake a new politicized investigation”. The justice department did not immediately respond to the Guardian’s request for comment.This is the third mortgage fraud inquiry the justice department has launched against Democrats and Democratic-appointed officials. Experts have called the pattern a type of “lawfare” as Trump and his allies use their roles to take down other officials.Last month, the US attorney general, Pam Bondi, appointed a special attorney to investigate similar mortgage fraud allegations the White House has levied against California senator Adam Schiff and the New York attorney general, Letitia James. More

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      Why Trump’s firing of the US jobs chief has economists worried

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      As it has for over a hundred years, the Bureau of Labor Statistics (BLS) will release its latest monthly jobs report on Friday.But the routine monthly update on the health of the US jobs market has been overshadowed by Donald Trump’s firing of the agency’s commissioner, Erika McEntarfer, hours after July’s statistics were released last month.The BLS’s data is parsed by Wall Street, Federal Reserve officials and company bosses across the US. It is also widely watched – and admired – internationally as a barometer of the US economy.Both liberal and conservative economists have criticized Trump’s nominated replacement at the BLS and have raised concerns over what will happen to the agency after the dramatic shake-up. Here’s what we know about what’s happening to the bureau.What does the Bureau of Labor Statistics do?The bureau reports key economic statistics through surveys of employers and prices. Every month, it releases data on the labor market, including the current unemployment rate, and the Consumer Price Index (CPI), which measures the cost of a basket of goods and services. This data is an important monthly snapshot of the US economy and how it changes over time.Why did Trump fire the bureau’s commissioner?Last month, the bureau announced the US had added just 73,000 jobs in July – far lower than expected – and made big revisions to previously released stats on the labor market in May and June. The number of jobs added to the economy across those two months was dramatically cut by over 250,000.Trump, who spent months boasting about the strength of the economy amid fears about the impact of his trade wars, was furious. “Today’s Job Numbers were RIGGED in order to make the Republicans, and ME, look bad,” he declared on social media.Hours after the numbers were released, Trump announced he was firing McEntarfer and that she would “be replaced with someone much more competent and qualified”.Has Trump firing of the bureau’s commissioner changed its operations?Economists say that Trump’s firing hasn’t changed the bureau, yet. Although the White House has made other job cuts at the BLS, as it did throughout the federal workforce. Since Trump took office, the bureau has seen a hiring freeze and has lost 15% of its workforce.While the bureau said it was downsizing its data collection for CPI, it did not say it was making any significant changes to its survey to employers.Economists say that, for now, the bureau’s operations have largely remained the same. William Watrowski, a longtime leader within the bureau, is currently its acting commissioner. But there are still many questions about the future of the bureau, especially after Trump announced his nomination for McEntarfer’s replacement.Who does Trump want to appoint as the bureau’s new commissioner?Trump has nominated EJ Antoni, chief economist at the conservative Heritage Foundation, as the bureau’s commissioner.Antoni was a contributor to Project 2025 – the Heritage Foundation’s rightwing blueprint for reshaping the US government – and was a vocal critic of the bureau last year, claiming that it manipulated numbers to make them more favorable to Joe Biden and Democrats. Last November, Antoni said on Twitter that Elon Musk’s so-called Department of Government Efficiency needed to “take a chainsaw” to the bureau.“Month after month, the government bean-counters under former-president Biden published overly optimistic estimates for everything from job growth to the size of the economy, only to have those numbers routinely – and quietly – revised down later,” Antoni wrote in May.When announcing his appointment, Trump said Antoni “will ensure that the Numbers released are HONEST AND ACCURATE”.Antoni has yet to be confirmed by Congress, and a confirmation date has not been set.Why did the bureau revise its job figures for May and June?Revisions are standard to the bureau’s reporting of the labor market, which is based on surveys to employers throughout the country.Large revisions often happen when employers take more time to complete the bureau’s surveys or revise their own figures due to changing circumstances. Economists have pointed out that uncertainty can lead to larger revisions. The pandemic, for example, saw jobs figures in flux as employers were handling different shutdown laws and the spread of the virus.The impact of Trump’s tariffs on data collection could be a major factor in the revisions seen earlier this year. Businesses have been reporting rollercoaster levels of uncertainty over tariff policy, with sentiment among US small businesses dipping down in the spring before going up again in the summer.“We’ve gone through periods where there were larger revisions before,” said Michael Madowitz, principal economist at the Roosevelt Institute who served on the bureau’s data users advisory committee before it was dissolved by the Trump administration. “This is like so standard, and the idea that it’s what actually set off this big political kerfuffle – this is a really unprecedented political situation.”Has the bureau gone through any political fights before?This isn’t the first time the bureau has been accused of manipulating numbers for politics. In the mid-90s, Alan Greenspan, the Federal Reserve chair at the time, criticized the way the bureau was calculating the CPI. Greenspan argued that the bureau was overestimating CPI, making inflation look higher than it actually was.Thomas Stapleford, a historian at the University of Notre Dame and author of The Cost of Living in America: A Political History of Economic Statistics, pointed out that Greenspan’s criticism led to a series of hearings where the bureau’s methodology came under question and debate. There were congressional hearings and a committee of economists was formed to investigate the methodology.“There’s all this detailed look at digging into the methodology by these outside experts and also testimony from [the bureau],” Stapleford said. “In my mind, if you have questions about the methodology, that’s the way to approach it.”But Trump has pushed the bureau into uncharted waters. Stapleford noted McEntarfer’s firing was the first time the president fired a bureau commissioner.“What the administration, in the eyes of critics, is doing is pushing the numbers in a particular direction. Not for reasons that it can justify publicly in terms of methodology, but simply because it would like a different outcome,” Stapleford said. “That’s a really big deviation from how the bureau has operated in the past.”What does this all mean for the future of the bureau?The commissioner isn’t involved in much of the day-to-day operations of the bureau. A new leader could have major sway over how the bureau collects and reports data in the long term, but there are protections in place, and any significant changes would be subject to public scrutiny.“The commissioner isn’t directly involved in the data calculation. Most of the BLS staff are long-term civil servants. They’ve been there a long time, they have various protections around them,” Stapleford said. “If the new commissioner started to force major methodological changes, I think that would raise a lot of red flags if those changes were controversial.”But even if major changes aren’t made immediately, the fact that Trump has called the bureau’s data into question could risk confusing Americans over whether the data can be trusted.“It takes a whole lot longer to build credibility than to lose. I don’t think any of the experts involved at this point are at all worried about the credibility of BLS’s work, but I know a whole lot less about what’s filtering down to the average person right now,” Madowitz said.As an example, Madowitz pointed out how the science around climate change has been clear.“But having a one-side, other-side public position on what the science says has left the public really confused,” Madowitz said. “It would be really bad if that’s how we decided to understand the economy.” More

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      Trump asks US supreme court to overturn trade tariffs ruling

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      Donald Trump has asked the US supreme court to overturn a lower court decision that most of his sweeping trade tariffs were illegal.The US president filed a petition late on Wednesday to ask for a review of last week’s federal appeals court ruling in Washington DC, which centred on his “liberation day” border taxes introduced on 2 April, which imposed levies of between 10% and 50% on most US imports, sending shock waves through global trade and markets.The court found in a 7-4 ruling last Friday that Trump had overstepped his presidential powers when he invoked a 1977 law designed to address national emergencies to justify his “reciprocal” tariffs.The decision was the biggest blow yet to Trump’s tariff policies, but the levies were left in place until 14 October – giving the administration time to ask the supreme court to review the decision.Trump has now appealed and the supreme court is expected to review the case, although the justices must still agree to do so. The administration asked for that decision to be made by 10 September.The appeal calls for an accelerated schedule with arguments being heard by 10 November, according to filings seen by Bloomberg. Justices could then rule by the end of the year.skip past newsletter promotionafter newsletter promotionThe ruling that the tariffs were unlawful upheld a previous decision by the US Court of International Trade.The federal appeals court said last Friday that US law “bestows significant authority on the president to undertake a number of actions in response to a declared national emergency, but none of these actions explicitly include the power to impose tariffs, duties, or the like, or the power to tax”.It said many of Trump’s steep tariffs were “unbounded in scope, amount and duration”, the ruling added, and “assert an expansive authority that is beyond the express limitations” of the law his administration has leaned on.A defeat for Trump’s levies would at least halve the current average US effective tariff rate of 16.3%, and could force the country to pay back tens of billions of dollars, according to Chris Kennedy, an analyst at Bloomberg Economics. It could also derail the preliminary trade deals the president has struck with some countries, including the UK and the European Union.Tariffs typically need to be approved by Congress, but Trump claimed he has the right to impose tariffs on trading partners under the International Emergency Economic Powers Act, which in some circumstances grants the president authority to regulate or prohibit international transactions during a national emergency.Earlier this week, the US clothing brand Levi’s said that “rising anti-Americanism as a consequence of the Trump tariffs and governmental policies” could drive British shoppers away from its denim. Other brands, such as Tesla, have also suffered in Europe and in Canada, while protests against US goods have led to a slump in sales of Jack Daniel’s whiskey. More

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      ‘He’s brazenly anti-worker’: US marks the first Labor Day under Trump 2.0

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      For this Labor Day, the Donald Trump administration has draped an enormous banner outside the US labor department with his portrait and the words “American Workers First.”Trump was elected on promises, since repeatedly pledged, that he would fight for workers and forgotten Americans. But many labor advocates say that Trump has consistently put corporate interests first in his second term as he has taken dozens of actions that hurt workers, often by cutting their pay or making their jobs more dangerous.Despite his vow to help coal miners, Trump halted enforcement of a regulation that protects miners from a debilitating, often deadly lung disease. He fired the chair of the National Labor Relations Board (NLRB), leaving the US’s top labor watchdog without a quorum to protect workers from corporations’ illegal anti-union tactics. Angering labor leaders, Trump stripped one million federal workers of their right to bargain collectively and tore up their union contracts.“It’s a big betrayal,” Liz Shuler, president of the AFL-CIO, the main US labor federation, said. “We knew it would be bad, but we had no idea how rapidly he would be doing these things. He is stripping away regulations that protect workers. His attacks on unions are coming fast and furious. He talks a good game of being for working people, but he’s doing the absolute opposite.”“This is a government that is by, and for, the CEOs and billionaires,” Shuler added.Trump has hurt construction workers by shutting down major wind turbine projects and ending Biden-era subsidies that encourage the construction of factories that make renewable-energy products. In moves that will harm some of the nation’s most vulnerable workers, the Trump administration has proposed ending minimum wage and overtime protections for 3.7 million home-care and domestic workers. It has also killed a Biden plan to prevent employers from paying disabled workers less than the $7.25-an-hour federal minimum wage.“There is a huge disconnect between Trump’s pro-worker rhetoric and the policies he’s putting in place. The gulf is enormous,” said Heidi Shierholz, president of the Economic Policy Institute, a progressive thinktank. “In his second term, he’s been absolutely, brazenly anti-worker.”“I keep thinking about his taking away the Biden-era increase in the minimum wage for federal contractors. It’s unbelievably brazen,” Shierholz continued. (Trump ended the requirement that federal contractors pay their workers at least $17.75 an hour.) “The minimum wage is incredibly popular. He just took away the minimum wage from hundreds of thousands of workers. That blew my mind.” As a result, many full-time workers will see their pay drop by more than $9,200 a year.The administration disputes all these criticisms. “The American worker has been left behind by the Democrat party for years, but President Trump has championed an agenda that puts the American worker first,” said Taylor Rogers, White House assistant press secretary.Trump has “unleashed an economic boom”, she said. Inflation is cooling, native-born Americans are benefiting from private-sector job gains and blue-collar wages are rising fast. “Under President Trump’s leadership, Republicans are once again the party of the American worker,” said Rogers.Many labor experts say Trump is even more anti-union than Ronald Reagan, often called the most anti-union president of modern times. Reagan fired 11,345 air traffic controllers who went on strike, but the AFL-CIO’s Shuler said that “pales in comparison” to Trump’s ending collective bargaining for 1 million federal workers. “That’s the largest single act of union-busting in our history,” she said.“He is worse than Reagan when it comes to his approach to unions,” said Julie Su, who was acting labor secretary under Biden. “We saw what Reagan did in the 1980s. That began a long decline in unionization. This president wants to make America non-union again. He’s certainly trying to make the government non-union again.”Shierholz said the “absolute scale of crushing unions” under Trump is “on a whole different scale from what we saw under Reagan. Trump is saying it’s absolutely open season on union folks. He took an absolute chainsaw to the federal workforce. He’s giving the green light to the private sector and local government to do the same.”Justin Chen, president of an American Federation of Government Employees council representing 8,000 Environmental Protection Agency (EPA) workers across the US, is angry that Trump halted collective bargaining for EPA employees, voided most of their union contracts and fired probationary workers. “Whatever he said about fighting for workers was a complete lie,” Chen said. “He treats federal employees with a great deal of disdain, not as civil servants valuable to make our government and economy run.”Many labor advocates say Trump’s signature policies, including tariffs and deportations, are hurting US workers. Trump’s tariffs are pushing up prices and slowing economic growth, economists say. Trump’s “big, beautiful” tax cut will harm millions of working families by cutting food assistance and causing many to lose health coverage. As for Trump’s deportation campaign, many workers say it’s undermining their employers’ businesses and forcing them to work harder because they have to do the work of their departed co-workers.In her annual State of the Unions address, AFL-CIO president Shuler said on Wednesday: “The state of working people in this country is they’re under attack.” She added: “We want cheaper groceries, and we get tanks on our streets. We want more affordable healthcare, and we get 16 million Americans about to be kicked off their coverage.” Shuler said unions will hold close to 1,000 rallies and other events this Labor Day across the US to kick off a year of mobilization.Jenny Smith, a home-care worker in Champaign, Illinois, said Trump’s plan to end overtime and minimum-wage protections for home-care workers shows contempt for struggling, low-wage workers. “Trump doesn’t know what it means to go to work day after day to earn a living,” she said. “If you take away these wage protections, it will take money out of these workers’ pockets. The majority of these workers are Black, brown and single mothers. You’re taking from their children’s mouths.”Smith voiced dismay that Trump hasn’t made good on his promise to reduce prices. “I’m very disappointed that prices aren’t going down,” she said. “I just bought a dozen eggs for $6.”She added: “I don’t think he cares about us, but he does care about the billionaires.”Trump has taken numerous steps that will weaken safety protections for workers. He is cutting staffing by 12% at the Occupational Safety and Health Administration (Osha). His administration has proposed eliminating a requirement for adequate lighting on construction sites. It is reducing the fines that small businesses pay for violating safety rules. It has proposed blocking the government’s mine-safety district managers from ordering upgrades in mine ventilation and safety. It has slowed action on Biden’s effort to protect workers from high temperatures.Trump also froze enforcement of a Biden-era regulation that protects miners from silicosis, a serious lung disease.“Silicosis has become a major killer among coal miners, but the Trump administration is trying to make silicosis great again,” said David Michaels, a professor of public health at George Washington University who headed Osha under Barack Obama. “The Trump administration has taken several steps that are devastating to the safety and health of the nation’s workers. Osha, which is under-resourced and underpowered, has become significantly smaller as a result of the Trump and Doge [Trump’s unofficial ‘department of government efficiency’] cuts.”Michaels warned that Trump’s cuts to Osha penalties will reduce incentives for companies to ensure safe conditions.Administration officials point to the Trump-backed “no tax on tips” and “no tax on overtime” as clearly pro-worker. But Yale’s Budget Lab notes that only 4% of workers in the bottom half by income are in tipped jobs, while almost 40% of tipped workers earn so little they don’t pay federal income taxes.Moreover, the no-tax-on-overtime provision will reduce income taxes far less than most workers realize. The deduction applies only to the “half” in “time-and-a-half” overtime pay. If a worker earns $20 an hour and their overtime rate is $30, that worker can deduct only the $10 premium for each overtime hour, not the full $30.Shierholz said that if Trump were serious about helping workers, “he would raise the minimum wage, make overtime pay double pay and do away with the sub-minimum wage for tipped workers. That would truly help workers, but that’s not what he’s doing. He’s doing as little as possible to help workers, while helping employers.”While Trump says his deportations will create job opportunities for US-born workers, Shierholz’s economic institute forecasts that Trump’s effort to deport 1 million immigrants a year will result in 5.9m lost jobs after four years: 3.3 million fewer employed immigrants and 2.6 million fewer employed US-born workers. “If you don’t have immigrant roofers and framers, you’re not building houses, and that means electricians and plumbers lose their jobs,” Shierholz said. “Plus, you lose the consumer spending from those workers.”Corey Mahoney, a 35-year-old cargo handler at John F Kennedy international airport in New York, said Trump’s policies have whipsawed workers at his warehouse. “The tariff situation has slowed down work, and many people lost their jobs,” he said. When Trump ended protected status for many Venezuelans and other immigrants, some of his Venezuelan co-workers left or were deported. “Some of the people I was working with tried to come to work, but they weren’t allowed,” he said. “We were left with less people, and we had to work twice as hard. It’s unfair.”“Trump is in an alternative universe thinking everything is good,” Mahoney said. “He doesn’t realize that normal people who are just trying to make a living aren’t happy with what he’s doing.” More

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      How Trump and corporations have hobbled US labor watchdog

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      Jennifer Abruzzo, general counsel for the National Labor Relations Board (NLRB) under the Biden administration, was one of the first officials to be fired by Donald Trump once he took office in January. She wasn’t the last.Since then, Trump has fired a slew of government officials, including the National Labor Relations Board (NLRB) chair, Gwynne Wilcox, the Bureau of Labor Statistics commissioner, Erika McEntarfer, and most recently, he has attempted to fire the Federal Reserve governor Lisa Cook.Abruzzo served at the agency for nearly 30 years before Trump fired her in January 2025, a move recommended in Project 2025. Now she is warning that the attacks on the US’s top labor watchdog threaten to return workers’ rights to levels unseen since 1935 and empower corporations to run roughshod over the agency.“My fear is that if this continues, where corporations and corporate billionaire donors have an outsized voice and directly influence our democracy, we’re going to find ourselves living in an environment such as what we lived in before 1935 when the National Labor Relations Act was enacted,” said Abruzzo. “Working families will be dealing with lower wages, substandard working conditions, and no real channels for them to fight back.”In May, the supreme court declined to reinstate Wilcox while she challenges Trump’s decision to terminate her without cause. A lower court will now have to rule on the issue, with the supreme court likely to follow on appeal. In the meantime, the agency’s powers have been effectively blocked and, Abruzzo worries, worse may be to come.The move was seen by opponents as a challenge to a landmark 1935 case, Humphrey’s Executor v United States, that ruled Congress can limit the president’s power to remove officials from independent administrative agencies.Abruzzo worries that Wilcox’s firing could pave the way for the National Labor Relations Act, enacted in 1935 to federally protect workers’ rights to organize and engage in collective bargaining, to be repealed entirely.“If the supreme court majority eliminates or limits the reach of Humphrey’s Executor and allows the president to fire decision-making officials in the executive branch, including at the NLRB, at his whim, then I anticipate the next step will be figuring out whether or not, if they are found unconstitutional, those provisions should be severed, or the whole [NLRA] act could conceivably be repealed,” Abruzzo said.In the meantime, Abruzzo argues, the NLRB has been rendered toothless.“It’s going to take years to sort out, the agency’s going to be completely ineffective in enforcing the statute, and working families are going to continue to suffer and not be able to get any redress for the violations of their rights. It’s why I think states need to step in and protect their citizenry.”Major corporations are already making ground against the agency after the ruling. On 19 August, the US court of appeals fifth circuit ruled preliminary injunctions halting unfair labor practice cases against Elon Musk’s SpaceX and two other employers can remain in place as the employers’ challenge the constitutionality of the NLRB.The NLRB declined to comment. SpaceX did not respond to multiple requests for comment.“I think we’re going to see a flood of employers forum shopping and flocking into district courts in the fifth circuit area seeking to get preliminary injunctions preventing the NLRB cases that frankly are seeking to hold corporations accountable for their law breaking from moving forward, and that’s going to put an end to the NLRB being able to enforce the act in any meaningful way,” said Abruzzo. “This is all about elevating corporate interests above workers’ rights.”The firings have also left the NLRB without a quorum throughout most of the Trump administration, rendering it unable to issue decisions on cases.In January 2025, after Trump fired Wilcox, the first Black woman to serve as chair of the NLRB board. Trump nominated two members to the board. They are awaiting a vote in the Senate for confirmation, while the term of one of two remaining board members, Marvin Kaplan, expired on 27 August.The agency has also proposed a 4.7% budget cut of $14m for fiscal year 2026, after noting the agency expects to lose nearly 10% of its staff to voluntary resignation and early retirements.The acting general counsel of the NLRB argued earlier this month that the board “has largely been unaffected” by the lack of quorum. But since Trump took office, the NLRB has only issued six decisions compared with fiscal year 2024, when the board issued 259 decisions.“Unless an employer is willing to go along with what the board says, the employer can stall a case indefinitely right now,” said Lauren McFerran, who served as chair of the NLRB during the Biden administration and as a board member from December 2014 to December 2019 and again in July 2020 to January 2021.“So whether it’s a [union] election case, whether it’s an unfair labor practice case, the minute the employer says that they’re not willing to go along and that they want to raise an objection to the board, you’re stuck for the foreseeable future at this point,” added McFerran.Abruzzo argues the firing of Wilcox by Trump, if allowed to stand by the courts, would eliminate the independence of the NLRB in favor of corporations. It’s up to the public to push back on these trends of stripping away protections for workers at the behest of wealthy, powerful corporations and billionaires like Musk, she said.“There is strength in numbers, and we all need to remember we matter. We make an impact on each other’s lives each and every day, and we can’t let the voice of corporate billionaires drown out our voices or squelch our actions and our spirit,” said Abruzzo.“We’re not powerless, and we have the power to demand changes to the way we’re governed, to the way we live our lives. That includes taking to the streets, frankly, and protesting over inadequate wages and working conditions and over economic, social and racial injustice. We need to do more in amplifying our voices, to make sure we’re heard and that actions are taken that are going to benefit us, because that’s, in my opinion, how the tactic of divide and conquer is going to be vanquished.” More

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      Most of Trump’s tariffs are illegal, federal court rules

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      Donald Trump overstepped his presidential powers with most of his globe-rattling tariff policies, a federal appeals court in Washington DC ruled on Friday.US law “bestows significant authority on the president to undertake a number of actions in response to a declared national emergency, but none of these actions explicitly include the power to impose tariffs, duties, or the like, or the power to tax”, the court said in the 7-4 ruling.Many of Trump’s steep tariffs are “are unbounded in scope, amount and duration”, the ruling added, and “assert an expansive authority that is beyond the express limitations” of the law his administration has leant on.The court’s decision is the biggest blow yet to Trump’s tariff policies and will likely mean the supreme court will have to rule on whether he has the legal right as president to upend US trade policy. The court said the ruling would not take effect until 14 October.“ALL TARIFFS ARE STILL IN EFFECT!” Trump wrote on social media, moments after the ruling came down, after the stock markets closed ahead of a three-day weekend in the US. In a lengthy post, he accused the appeals court of political bias.“If allowed to stand, this Decision would literally destroy the United States of America,” he continued. “At the start of this Labor Day weekend, we should all remember that TARIFFS are the best tool to help our Workers, and support Companies that produce great MADE IN AMERICA products.”The ruling voided Trump’s “Liberation Day” tariffs that set a 10% baseline on virtually all of the US’s trading partners and his so-called “reciprocal” tariffs on countries he has argued have unfairly treated the US.Trump has claimed he has the right to impose tariffs on trading partners under the International Emergency Economic Powers Act (IEEPA), which in some circumstances grants the president authority to regulate or prohibit international transactions during a national emergency.The Trump administration has cited various national emergencies – including US trade deficits with trading partners, fentanyl trafficking, and immigration – as the reasons for the actions.But a group of small businesses has challenged the administration’s arguments, arguing they are “devastating small businesses across the country”.And on Friday, the appellate court ruled: “It seems unlikely that Congress intended, in enacting IEEPA, to depart from its past practice and grant the president unlimited authority to impose tariffs.”The ruling also said the US law “neither mentions tariffs (or any of its synonyms) nor has procedural safeguards that contain clear limits on the president’s power to impose tariffs”.Earlier on Friday, Bloomberg reported that the administration, worried the court might invalidate the tariffs immediately, filed statements by Scott Bessent, the treasury secretary, Howard Lutnick, the commerce secretary, and Marco Rubio, the secretary of state, warning that such a decision would be a “dangerous diplomatic embarrassment” for the US.In a statement, White House spokesman Kush Desai said that Trump “lawfully exercised the tariff powers granted to him by Congress to defend our national and economic security from foreign threats”.He said: “The president’s tariffs remain in effect, and we look forward to ultimate victory on this matter.”William Reinsch, a former senior commerce department official now with the Center on Strategic and International Studies, told Reuters that the Trump administration had been bracing for this ruling. He said: “It’s common knowledge the administration has been anticipating this outcome and is preparing a Plan B, presumably to keep the tariffs in place via other statutes.”The US trade court heard the case – VOS Selections Inc v Trump – in May, and ruled that the tariffs “exceed any authority granted to the president”. But the court agreed to a temporary pause in the decision pending an appeal hearing.The US court of appeals for the federal circuit in Washington DC heard oral arguments about the case on 31 July. Judges expressed skepticism about the administration’s arguments at the hearing. The IEEPA “doesn’t even say ‘tariffs’”, one of the judges noted. “Doesn’t even mention them.”In its ruling, the appeals court noted there were “numerous statutes” that do delegate the power to impose tariffs, in which “clear and precise terms” are used to this make clear.When Congress wants to delegate such authority, it typically “does so explicitly, either by using unequivocal terms like tariff and duty, or via an overall structure which makes clear that Congress is referring to tariffs”, the court added.It said: “The absence of any such tariff language in IEEPA contrasts with statutes where Congress has affirmatively granted such power and included clear limits on that power.”Trump’s tariffs have triggered economic and political uncertainty across the world and stoked fears of rising inflation. More