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      ‘Zombie-like’: the US trade agreement that still haunts Democrats

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      More than 30 years have passed since President Bill Clinton persuaded Congress to ratify the North American Free Trade Agreement (Nafta) and yet the trade agreement still infuriates many voters and hangs over Kamala Harris’s – and the Democrats’ – chances in this year’s elections.Zombie-like, Nafta just keeps coming back, decades after many Democrats believe it should have died. At the Republican convention, Donald Trump attacked Nafta, calling it “the worst trade agreement ever”. In speech after speech, Nafta is a topic Trump turns to as he seeks to woo the voters in the pivotal blue-collar communities of Michigan, Pennsylvania and Wisconsin – many of whom remain angry about the job losses it caused.There were early warning signs. “A lot of people were saying Nafta was going to be a disaster economically,” said David Bonior, a former Democratic congressman from Michigan who led the congressional fight to defeat Clinton’s push for Nafta. “I could see it was going to be a disaster politically, too.”Nafta acted like a slow-motion poison for Democrats. After Congress ratified it in 1993, year by year more factories closed and more jobs disappeared as manufacturers moved operations to Mexico to take advantage of that country’s lower wages. The Economic Policy Institute, a progressive thinktank, estimates that the US lost 682,000 jobs due to Nafta, which largely eliminated tariffs between the US, Mexico and Canada.“It’s a lingering issue in Michigan,” said Ron Bieber, president of the Michigan AFL-CIO, the US’s largest federation of unions. “Everyone knows someone here in Michigan who lost their job due to Nafta. The door was cracked open to outsourcing before Nafta, but Nafta threw the door open after it was passed.”JJ Jewell, who works at a Ford axle plant in Sterling Heights, Michigan, was born two years before Nafta was ratified. The trade pact has been part of the background of his life, he says. Jewell said he often discussed trade problems with other auto workers, even when they didn’t directly discuss Nafta. “It’s an issue,” he said. “Nafta helped expedite the loss of jobs from our country to a country where wages are cheaper. I have friends, family members, neighbors who lost their jobs as a direct result of Nafta. It still affects things decades later.”While Trump talks tough on trade and protecting factory jobs, Jewell said that Trump, while president, fell badly short in his vows to bring back manufacturing jobs. “It’s empty promises,” he said.Liz Shuler, the president of the AFL-CIO, the country’s main labor federation, agreed, saying that Trump’s tough words on trade have done little for workers. “This is an example of Trump’s rhetoric not matching reality,” Shuler said. “He talks a good game, but there’s no action to back it up. When he had the ability to make a difference, when he was president, he went to different places and pretended to be a savior, and you followed up and you saw that those plants closed and jobs were moved to Mexico. He did nothing to fix it.”Seeing all the lingering discontent about Nafta, many Democrats say it’s unfair for Trump and others to blame their party for the agreement. The idea for Nafta arose under Ronald Reagan, they say, and George HW Bush negotiated the deal, both Republicans. More Republicans in Congress voted to ratify Nafta than Democrats. The vast majority of Senate Republicans also voted for it, while most Democratic senators voted against ratification.Still, Bonior said that Clinton and his administration “get the blame because their top guy was for it”, he said. “Clinton was instrumental in making it happen.”Many workers who lost jobs due to Nafta were able to find other jobs, said Bonior, but their pay was 20% less on average. “Lifestyles were enormously downgraded in my district,” said Bonior, who served as House majority whip. “Clinton bought into Nafta, but a lot of working-class people saw that as a betrayal.”On Nafta, Clinton won strong backing from economists and corporate America. Brushing aside labor’s warnings that Nafta would speed the loss of jobs to Mexico, nearly 300 economists on the right and the left, including several Nobel Prize winners, signed a pro-Nafta letter, saying: “The assertions that Nafta will spur an exodus of US jobs to Mexico are without basis.”Many economists argued that Nafta would increase the number of manufacturing jobs in the US because the nation had a higher-skilled, more productive workforce than Mexico and would thus, in theory, gain factory jobs in an expanded free-trade zone. Pro-Nafta forces also argued that the closer economic integration of the US, Mexico and Canada would create a North American powerhouse to counter China’s fast-growing economic power.Jeff Faux, a former president of the Economic Policy Institute, said many economists failed to realize something important that was happening when Nafta was negotiated: “The US was losing its manufacturing base. It was deindustrializing.”Faux, one of the most outspoken economists against Nafta, said Clinton embraced Nafta because he was eager to present himself as a different type of Democrat and “was trying to ingratiate himself with the business community”. “Clinton saw Nafta as an opportunity to present himself as not just another liberal Democrat,” Faux said. “It was the beginning of the notion that came to dominate the Democratic party that its future is not in working people, that it’s in professionals, in women, in minorities and various ethnic groups. They wanted to put together a new coalition, and labor would be a thing of the past.”Michael Podhorzer, a former AFL-CIO political director, said many blue-collar workers remain angry about Nafta because it was such a departure from President Franklin Roosevelt’s emphatically pro-worker Democratic party. Podhorzer said: “Nafta is the catchall for a series of things that Democrats did that showed they had a greater concern for business interests and a kind of insensitivity to the consequences that accelerating deindustrialization would have on people’s lives.”Trump was shrewd to seize on Nafta, he said: “It’s a way for him to sort of wave a flag, but it doesn’t actually mean he’s on the workers’ side. It channels pretty effectively the frustration that many Americans feel in seeing their jobs go offshore or to Mexico or seeing their communities hollowed out or seeing fewer economics prospects for their kids.”In the view of many labor leaders and workers, the Democrats doubled down on misguided trade policy when Clinton successfully pushed Congress in 2000 to approve normal trade relations with China. That move encouraged many US corporations to outsource operations to lower-wage China, with one study finding that the country lost 2m jobs, including 985,000 factory jobs, because of the normalized trade relations with China. The number of factories in the US also declined by 45,000 from 1997 to 2008, with many workers blaming Nafta and the China trade deal.What’s more, many unions faulted Barack Obama for pushing for another free trade agreement: the Trans-Pacific Partnership (TPP), a pact with 12 Pacific Rim countries. TPP’s supporters said the deal would increase US exports and build a powerful economic bloc to counter China. TPP was signed in 2016 under Obama’s presidency, but soon after Trump became president, he withdrew the US from TPP, preventing it from taking force.“Obama wasn’t great shakes on trade either,” Bonior said. “A lot of working people said they had enough. They decided we’re not going to be with the Democrats any more, and Trump came along and filled the void. That was very smart for Trump to do.”In a 2016 campaign appearance in Pittsburgh, Trump made a major speech on trade that denounced Nafta and cited several Economic Policy Institute studies that criticized the trade pact. Lawrence Mishel, who was the institute’s president at the time, said: “Trump never really explained what he would do about Nafta or trade. He ended his speech with a call for deregulation and tax cuts for the rich, which was far more pro-Chamber of Commerce than pro-worker.”While Joe Biden voted to ratify Nafta when he was a senator, labor leaders say the president’s current pro-worker stance on trade shows that he recognizes his Nafta vote was a mistake. For Bonior, it might be too little too late.“Biden has been very good on working-class issues. Biden is trying to make up for his vote on Nafta,” Bonior said. “But a lot of working-class people are turned off so much to the Democrats that they’re not hearing of the things Biden and Harris have done for them. They’re not listening. They’re gone. I don’t know if we’ll ever get them back.“They’re to some degree mesmerized by Trump even though Trump has never been for working people,” Bonior continued. “Those plants he said he would restore – he never did any of that.”Many union leaders slam Trump for a speech he gave in Youngstown in which he told thousands of workers that he would bring back all the factory jobs that Ohio had lost. “They’re all coming back,” he said. They didn’t. And when General Motors closed its huge assembly plant in nearby Lordstown, Ohio, in 2019, Trump did little to stop the plant closing or bring back the lost jobs.“He said all those jobs would be coming back, and then he did nothing,” said Shawn Fain, president of the United Auto Workers (UAW). “The auto industry abandoned Lordstown, and Trump did nothing.”When Trump was running for president in 2016, he vowed to renegotiate Nafta, and he followed through, reaching a new United States-Mexico-Canada Agreement (USMCA) in 2018. Labor leaders had attacked Nafta not only for encouraging companies to move factory jobs to Mexico and but also for failing to effectively protect Mexican workers whose employers had violated their right to unionize or other rights.Union leaders agree that USMCA created a stronger mechanism to crack down on labor violations by Mexican companies, although the Trump administration negotiated that improved enforcement mechanism only after the House speaker, Nancy Pelosi, and House Democrats demanded that Trump go further in the negotiations. But under USMCA, often called “Nafta 2.0”, US companies have continued moving manufacturing operations to Mexico.Even though USMCA made only minor changes to Nafta, Trump called it, “the best trade deal ever made”. For her part, Harris was one of 10 senators to vote against USMCA, saying it didn’t improve Nafta sufficiently.Faux said many workers applaud Trump on trade because “he did something” about it by renegotiating Nafta, while “the Democrats did nothing”.Labor leaders have differing views of USMCA. David McCall, president of the Pittsburgh-based United Steelworkers, said: “I think Nafta 2.0 was helpful. It’s gotten some better labor protections.”But the UAW’s Fain was merciless in attacking USMCA. “I like to call it Trump’s Nafta,” Fain said. “Trump’s Nafta only made problems worse. Trump’s Nafta only gave the billionaires more profits. Trump’s Nafta only killed more American jobs. Trump’s Nafta only shipped more work to Mexico.”Both Harris and Trump say they will renegotiate USMCA if elected. Trump also says he will protect factory jobs by imposing a 20% tariff on all imports, but the Steelworkers’ McCall says that’s a terrible idea. “I don’t think the solution to the problem is to have tariffs for the sake of having tariffs,” McCall said. “That’s protection. I think trade is a good thing. It’s an economic stimulator.” He said the US should use tariffs not in a blunderbuss way, but to “punish cheaters or countries that dump their various products”.McCall said the Biden-Harris administration had had a far better strategy for protecting factory jobs. “It’s the first time in generations that we’ve had an industrial policy in this country,” he said, praising three important laws passed under Biden: the infrastructure law, the green energy law and the Chips Act to encourage semiconductor production. McCall said those laws, along with Biden’s targeted tariffs “against countries that cheat”, give the US “an opportunity to be the most productive producers of many products”.While many blue-collar workers like Trump’s views on trade, McCall said: “He’s not a friend of unions or labor. For Trump it’s all about him, not about the person that’s working on the job: the steelworker, the electrical worker, the teamster or the UAW member.” More

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      in US Politics

      Scrutiny of Republican Tim Sheehy’s business grows amid US Senate race

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      Scrutiny is growing about the Montana aerial firefighting company once led by Tim Sheehy, the former Navy Seal and Republican Senate candidate who could oust the Democrat incumbent Jon Tester in next month’s election.According to NBC News, Sheehy’s Bridger Aerospace, a company he founded in 2013, negotiated a deal with Gallatin county in eastern Montana to use its pristine credit rating to raise $160m in bonds. The county was meant to benefit from Bridger’s plans to hire more workers and build two new aircraft hangers.But the company used most of the money, or $134m, from the 2022 bond issue to pay back previous investment from Blackstone, a New York-based investment giant.Bridger’s finances have been complicated by the fact that there were fewer wildfires to fight this year and thus less revenue for Bridger. As of Tuesday, the National Interagency Fire Center reported 42,603 wildfires nationwide this year compared to the 10-year average of 48,689 for the same period.In financial filings for the quarterly period that ended 30 June 2024, Bridger said it had “a substantial amount of debt” and that failure to service that debt “could prolong the substantial doubt about our ability to continue as a going concern”.A victory for Sheehy in November could hand Republicans control of the Senate, making his connections to Bridger a vital topic as voters head to the polls.Sheehy, 38, stepped down as the company’s CEO in July. He has run his campaign partly based on his business acumen.The questions around Gallatin county’s approval of Bridger’s bond deal revolve around whether the board was correctly informed of the company’s financial position – it has lost $150m since it was founded – and whether Gallatin’s credit rating could be affected.Marc Cohodes, a Wall Street investor who issued an early warning regarding FTX and its CEO, Sam Bankman-Fried, as well as calling the collapse of Lehman Brothers in 2008, is among the signatories on a letter to Gallatin county and the US Small Business Administration asking for an investigation into Bridger’s use of capital.The letter questioned why Bridger presented itself to the federal government as a “socially and economically disadvantaged business”.“Gallatin County had their name on the bonds and when they default, and they will, lawyers and lawsuits will come after Gallatin County,” Cohodes told the Bozeman Daily Chronicle. “‘Read the fine print’ will not be a good defense on this.”But Sheehy’s campaign pushed back, saying the deal’s critics were Democratic supporters of Tester.“It is clear Tester’s supporters wrote this letter with one goal: to hurt Tim’s campaign, tear down a Montana company, and help Jon Tester,” a campaign spokesperson told the Chronicle.“Bridger Aerospace is a good company that protects public lands by fighting wildfires, and it is our hope that the authors of this letter cease their efforts to destroy a Montana business, put Montanans out of a job, and wipe out their retirement savings.”Zach Brown, a Gallatin county commissioner, told NBC he was not worried that the bond money had gone to pay Blackstone.“It isn’t our role to monitor the construction and operational decisions of a private company or communicate to the community the status report of how they’re doing,” Brown told NBC.“Our role is not to monitor whether they added jobs – it is to endorse the public interest of their project.”While Gallatin county is not on the hook for the bond repayments, the county could see its credit rating affected if Bridger went out of business. Since January last year, when Bridger went public, its stock is down 64%.skip past newsletter promotionafter newsletter promotionBridger reported losses of $77m in 2023 and was at risk of failing to meet its financial obligations.“The Company has suffered recurring losses from operations, operating cash flow deficits, debt covenant violations, and insufficient liquidity to fund its operations that raise substantial doubt about its ability to continue as a going concern,” Bridger’s auditor said, according to the Montana Free Press.The company said in the report that it began cutting costs and had reduced its workforce to 148, down from 166 in 2022.A spokesperson for Bridger told NBC that the company has continued to pay interest on the bonds, which are backed by “robust collateral which has appreciated significantly in value since the bond was issued” and is working to repair its cash flow problems.Separately, Sam Davis, Bridger’s CEO, told the outlet that the company had battled more than 160 Montana wildfires since the bond issue.The county’s support for the company, Davis added, had been “tremendous” and allowed the firefighting company to “contract with multiple local businesses as we expand and operate our business, and provide a strong customer base to local hotels, restaurants, and transportation providers”.Questions around Bridger come as Sheehy’s service record also has come under scrutiny. The Trump-backed candidate has claimed he was shot in the arm during a firefight in Afghanistan.But a Montana park ranger has claimed that the gunshot wound was self-inflicted in Glacier national park in 2015. Nor do Sheehy’s fellow soldiers recall him mentioning a gunshot wound or seeing a wound at the time during his service in central Asia.Sheehy has insisted that he was shot in Afghanistan and that claims to the contrary are “tantamount to falsely accusing him of stolen valor”.Sheehy has also come under attack for allegedly characterizing Crow Native Americans as “drunk Indians”. He told Fox News last month they were old recordings, and suggested they were edited, reports the Daily Montanan. More

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      in UK Politics

      Public sector pay rises hand Reeves a £6.7bn headache ahead of Budget

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      Your support helps us to tell the storyThis election is still a dead heat, according to most polls. In a fight with such wafer-thin margins, we need reporters on the ground talking to the people Trump and Harris are courting. Your support allows us to keep sending journalists to the story.The Independent is trusted by 27 million Americans from across the entire political spectrum every month. Unlike many other quality news outlets, we choose not to lock you out of our reporting and analysis with paywalls. But quality journalism must still be paid for.Help us keep bring these critical stories to light. Your support makes all the difference.CloseRead moreCloseHigh borrowing costs and public sector pay rises have given chancellor Rachel Reeves a £6.7bn headache ahead of next week’s Budget.Borrowing in the first six months of the year stood at £79.6bn, £1.2bn higher than a year earlier and almost £7bn higher than the Office for Budget Responsibility watchdog – which monitors the state’s finances – had estimated.The surprise rise in borrowing came despite the cut to Britain’s expenditure on winter fuel allowances, which will now be means-tested and will be paid next month.Jessica Barnaby, deputy director for public sector finances at the Office for National Statistics, which released the data, said: “While tax revenue increased, this was outweighed by increased spending, partly due to higher debt interest and public sector pay rises.”Ms Reeves has said she needs to fix a £22bn “black hole” in Britain’s finances. She is looking at ways to cut spending and raise money to fix it.Today’s news may tempt her to look at the UK’s liabilities rather than debt when it comes to measuring the government’s financial health.Rob Wood, chief UK economist at Pantheon Macroeconomics, said: “Changing the fiscal rules in that way would give the government about £50bn additional headroom to borrow.“We think markets will be unruffled by that change because boosting investment should raise GDP, making government borrowing more affordable.”Treasury chief secretary Darren Jones said the state of the public finances meant there would be “difficult decisions” in next Wednesday’s Budget.He said: “We have inherited a £22 billion black hole in the country’s public finances, including no plan to fund pay deals for millions of public sector workers.“Strikes cost at least £3 billion last year, so it was the right thing to do to end those damaging disputes.“Resolving this black hole at the Budget next week will require difficult decisions to fix the foundations of our economy and begin delivering on the promise of change.”While borrowing costs for the government stand at about 4 per cent, rates are likely to fall.UK interest rates will almost halve from their present rate of 5 per cent, top US investment bank Goldman Sachs said yesterday.Borrowing rates, set by the Bank of England, will sink to 2.75 per cent by the end of next year, Goldman predicts, suggesting a faster fall than borrowers and lenders have forecast. More

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      in US Politics

      Biden’s economic legacy could decide the presidential race in Scranton

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      From the north, motorists pull into Scranton via the Joseph R Biden Jr Expressway. Cutting through the scenic Pocono Mountains, now at the start of autumn color season, they are greeted with a towering, electric billboard, blaring an encapsulating – if divisive – message to this working-class town: “Democrats for Trump,” it reads. “Economy,” it continues, with a green checked box next to the word.The sign in Biden’s hometown is the perfect fall 2024 welcome mat in this crucial swing state filled with voters whose economic anxiety or satisfaction will decide next month’s election.The US has staged a remarkable recovery since the pandemic and Biden has successfully pursued an economic agenda, Bidenomics, that should benefit Scranton and the state – $13bn has been earmarked from his infrastructure bill for repairing highways and bridges alone. But poll after poll shows deep-seated worries about the economy – worries that could sink Democrats’ chances of keeping the White House come November.Like many mid-sized upper midwest cities that have faced post-industrial decline, Scranton, a longtime Democratic stronghold, has grown more conservative in recent elections. With the city’s native son leaving office, and pocketbook issues top of mind, some believe Trump could finally take Scranton – a more-than-symbolic win.But with Kamala Harris, Biden’s successor, and Donald Trump tied in the polls, guessing who will take Scranton, Pennsylvania, and the White House is a fool’s errand. And this politically split town shows why the race is so close. On the street, one person’s economic reality may be entirely different to the next.The complicated political mix of fears about the local economy, faith and mistrust in both Harris and Trump and shifting political allegiance was evident at the Marketplace at Steamtown, a downtown mall filled with local mom-and-pop shops.Pete, 78, a swing voter who declined to provide his last name, said inflation had been a problem over the last four years, but added prices were coming down, the stock market was high, and said he didn’t blame Biden for the economic challenges.“Every president is stuck with what happened before, and the pandemic happened, so Biden was in a hole to begin with,” Pete said. But the veteran added the main issue driving him to Harris was Trump disrespecting veterans: “He called us suckers and losers.”The argument for Trump’s economics is ironclad, said Lori Higgins with a scoff: “Look at the last four years – everyone is paying more for everything. What more do you need to know to make a decision?” Now 52, she voted for Democrats until Trump convinced her to switch sides in 2016.Even on the most basic details, there is disagreement: Pete said he had just paid $2.99 for gas, citing it as evidence that inflation was coming under control. Two Trump supporters said they paid as much as $3.50 for gas, evidence, they said, that inflation is still squeezing Scranton.Trump and Harris have made close to 50 visits to Pennsylvania so far this election cycle and poured nearly $1bn into ads – a record spend that reflects how crucial its 19 electoral votes, the biggest prize of any battleground, make the keystone state. Trump made his second visit to Scranton in as many months last week. “Go get everyone you know and vote immediately,” he urged rallygoers.But persuading any part of the deeply divided electorate to swap their vote looks difficult.View image in fullscreenHarris may yet hold Scranton, said Berwood Yost, a Pennsylvania pollster, but that is “surprising” given the level of economic discontent in the city and the county. “The dissatisfaction with Biden is really high and views on personal finances are very negative, so Trump should be clearly ahead,” Yost said. And yet polling averages show Harris ahead by a point in Pennsylvania, (firmly within the margin of error) which “speaks in part to some voters’ concerns about Trump and his personal character”.Since 2000, Democrats have won the county with as much as 63% support, but Hillary Clinton narrowly won with less than 50% of the 2016 vote. Biden’s home-field advantage may have buoyed Dems in 2020 – he was born and raised in Scranton until the age of 10, when his family moved to Delaware, and he has name-checked the city throughout his long career and is still nicknamed “Pennsylvania’s third senator”. Biden beat Trump in the county by 53.7% to 45.3%.Still, Scranton has become “ground zero for demonstrating the appeal of Trump and the Maga movement, and places that traditionally voted Democrat and ended up changing their stripes in a significant way”, Yost said.‘Way more optimistic’Once a powerhouse city in the nation’s coal capital, Scranton’s economy is now driven by small business, retail, healthcare, education and the service sector, said Satyajit Ghosh, a University of Scranton economist. Though there is no shortage of empty storefronts downtown, it is noticeably livelier than many similar Rust belt urban cores.University of Scranton’s surveys of downtown businesses found owners in April had concerns about the current economic climate but were decidedly more optimistic about the next six months: “Way more optimistic than they were a year ago,” Ghosh said.View image in fullscreenYost’s most recent polling put Harris up three points statewide and found the economy to be the top issue for 34% of residents. Other recent polling found 60% of Pennsylvanians said their economic situation was worse compared with 40% who say it was better or no different.James Simrell is part of the latter group. As he closed up his boxing gym in Steamtown, the lifelong Democrat was upbeat about Scranton’s economy. His gym is just one of his three businesses, and all stay busy – he also designs jewelry and runs a small farm that produces butternut squash and pumpkins. He sells pumpkins to Blackwatch Cafe, and squash to Abe’s Delicatessen, which uses it in their soup. “Everyone is doing well,” Simrell said.In contrast, the Trump economy was “falling apart” as the former president left office amid a poorly managed pandemic, Simrell said. He has other reasons for not voting for Trump. His two adopted children are Black and Trump is “a little bit prejudiced – it drives my wife crazy”.Echoing longtime Democratic voters’ sentiment, he added: “My mom and dad were Democrats and I follow what they believe, and Kamala’s the best person to be president – she’s not crazy.”But lingering inflation is still a drag for Eric Flesher, who runs a collectibles and vintage store, Rock-N-Models. He likened the economy to a “tightening sphincter”.skip past newsletter promotionafter newsletter promotionHe declined to talk about politics, but said everything remained expensive: “I’m in a business that sells stuff that nobody needs unless they have disposable income, so it gets much more difficult” when there is inflation, Flesher said.Flesher added that he disagreed with the “mindset here that I should vote for someone because that’s how my mom and dad voted – then you’re just voting for a party and not a person”, he added.‘She’s not the kind you can trust’The economic indicators in Scranton track those of the wider US. Inflation, which peaked at an annual rate of 9.1% in mid-2022, has eased to 2.4%. Prices are similarly down in Scranton, the economist Ghosh said. Unemployment in the region was 4.8% in August, above the 4.1% national average but down from 9.2% when Biden took office in January 2021.“In this area, which I’ve covered for many years, I really haven’t ever seen this strong of a performance in terms of employment,” said Ghosh. Still, there’s an after-effect of inflation that consumers feel, Ghosh added, and some high prices, like those for rent or food, are still hurting.Outside a Walmart in Dickson City, a retail hub just north of Scranton, husband and wife John and Carol Gardner still feel the pinch. The Mount Cobb residents used to pay $150-$200 a month on groceries, and now they pay twice that. Carol is out of a job on disability, while John assembles buffet trays for $12 an hour to make ends meet, even though he said he should be retired.View image in fullscreen“Trump at least made sure we could go shopping, and Biden is making sure we can’t,” Carol said. “I hope the lady doesn’t get in because we’re going to go straight downhill – she’s not the kind you can trust.”The view is different at Bethel AME, a 153-year old Black church on downtown’s west side. Pastor Mark Alexander sees an improving economy, and blames inflation on Trump.“Inflation was more so because of Covid, and how the former president handled that situation, because when you have supply chain interruptions and poor leadership guiding the nation, it exacerbates things,” he said.The Federal Reserve, not the president, decides rates, Alexander noted, and he pointed to low unemployment, the Chips Act – which is pouring billions into domestic research and manufacturing of semiconductors – and Biden’s infrastructure bill as evidence of the president’s economic success.Moreover, at Bethel AME, there is “excitement for someone who looks like us and has experienced some of things we have gone through and comes from a middle-class upbringing”, Alexander added. “As opposed to a billionaire who has no clue what it is like day to day for middle-class people,” he said. That’s especially true with younger people because Harris “speaks their language”, Alexander added.For others, neither candidate is appealing. Mike Gilson owns a flooring business, a maintenance company, and manages artists and chefs. He said the economy was strong locally because its economic backbone was made up of longtime small businesses, and it fared better during the last session than most other areas because of that composition.View image in fullscreenBut the city’s relatively strong economic standing is not persuading Gilson to vote for Harris. He said the president was a “ceremonial position” and big corporations run the nation. “If the president actually wielded the power that people think they do then voting would make a lot more sense to me,” Gilson said.History will decide which of Scranton’s many voices will decide this election. Right now it is unclear whether the legacy of the city’s most famous son will be enough to carry Harris over the line or finally hand Scranton and the state to Trump.With the race essentially a toss-up at this point, the key for either party is going to be turnout, Yost said. But in that battle, Trump may have an advantage – people who are less likely to vote have in recent elections voted for Trump.“Democrats have to counter that by getting their voters to the polls,” Yost said. “Think about the election as a mosaic – there are many pieces and some are bigger than others, but they’re all going to matter.” More

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      in UK Politics

      Budget 2024: Inheritance tax set to rise – here’s what it means for you

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      Your support helps us to tell the storyThis election is still a dead heat, according to most polls. In a fight with such wafer-thin margins, we need reporters on the ground talking to the people Trump and Harris are courting. Your support allows us to keep sending journalists to the story.The Independent is trusted by 27 million Americans from across the entire political spectrum every month. Unlike many other quality news outlets, we choose not to lock you out of our reporting and analysis with paywalls. But quality journalism must still be paid for.Help us keep bring these critical stories to light. Your support makes all the difference.CloseRead moreCloseChancellor Rachel Reeves is reportedly planning changes to inheritance tax at the Budget as she looks to raise up to £40bn from tax hikes and spending cuts.While specifics remain unclear, any changes could significantly affect how much families pay on inherited properties and their financial futures.Here’s everything you need to know about the potential changes and what they could mean for your family. What is inheritance tax?Inheritance tax is a levy applied to the estate of someone who has passed away, but only around four per cent of families end up paying it, as most estates fall below the tax threshold. Key to this exemption is that anything left to a spouse or civil partner is not subject to inheritance tax, regardless of the estate’s value. For instance, if a deceased individual leaves their entire estate to their partner, even if valued at a million pound, no inheritance tax will be charged. However, this exemption does not extend to partners who live together but are not married or in a civil partnership. Each individual has a £325,000 inheritance tax-free allowance. Estates valued below this threshold incur no tax, while those above it are taxed at 40 per cent on the excess.What changes could be coming?The government has been exploring multiple avenues to increase revenue, particularly in light of a reported £40 billion budget shortfall, the BBC reported. Although specific measures to exemptions and reliefs have yet to be confirmed, discussions include revisiting existing rules surrounding gifts given during a person’s lifetime. Under current regulations, if an individual gives away more than £325,000 and dies within seven years, those gifts could still incur inheritance tax liabilities for the recipients. The new Budget could address specific reliefs for businesses and agricultural land, which currently have tax exemptions. However, the extent of the new changes remains unclear. What has the government said?Several ministers and the prime minister have promised taxes will not rise for “working people”, suggesting the wealthiest are likely to be hit hardest by new measures.Ahead of her first Budget, the chancellor refused to rule out hiking capital gains and inheritance tax. Setting the scene for a brutal financial statement, she said: “I think that we will have to increase taxes in the Budget.”Ms Reeves did not specify which taxes would rise, but said Labour would stick to its manifesto pledge not to hike national insurance, VAT or income tax.The chancellor said: “We had in our manifesto a commitment to fiscal rules to balance day-to-day spending through tax receipts, and by the end of the forecast period, to get debt down as a share of GDP.“Those are sensible fiscal rules to keep a grip of the public finances. We also made other commitments in our manifesto, not to increase national insurance, VAT or income tax for the duration and we’ll stick with those.”Shadow chancellor Jeremy Hunt criticised Labour’s fiscal plans, saying: “During the election we repeatedly warned that Labour’s sums didn’t add up and that they were planning to raise taxes. The real scandal is that despite planning these tax rises all along, they didn’t have the courage to admit it to the public during the election campaign.“Unfortunately, it looks like it will be people who have saved all their life to provide an inheritance to their family who will pay the price for Labour’s tax rises.”What does this mean to you?For families planning their estates, these potential changes would mean individuals need to further plan their finances. If inheritance tax rates increase or exemptions are altered, those intending to leave an inheritance may need to reassess their options to minimise tax liabilities. More

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      Musk steers X disputes to conservative Texas courts in service terms update

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      Elon Musk’s X has updated its terms of service to steer any disputes from users of the social media platform formerly known as Twitter to a federal court in Texas whose judges frequently deliver victories to conservative litigants in political cases.New terms of service that will take effect on 15 November specify that any lawsuits against X by users must be exclusively filed in the US district court for the northern district of Texas or state courts in Tarrant county, Texas.It is common for companies to include venue clauses in their terms of service specifying which forum would hear any disputes filed against them. But the choice of the northern district of Texas stands out because X is not located in the district.Following a move from San Francisco, X is headquartered in Bastrop, Texas, near Austin, whose federal court is in Texas’s western district. That district has far fewer Republican-appointed judges than the northern district, which has become a favored destination for conservative activists and business groups to pursue lawsuits seeking to block parts of Joe Biden’s agenda, a tactic Democratic lawmakers say smacks of “judge-shopping”.“It’s hard to imagine that’s unrelated to this new language,” said Stephen Vladeck, a law professor at Georgetown University.X did not respond to a request for comment. Musk, the world’s richest man, has increasingly embraced conservative causes and become a major financial supporter of Donald Trump in his campaign to win the 5 November presidential election.Texas’s northern district already is the host of two lawsuits X has filed after several brands pulled ads from Musk’s platform, including one against liberal watchdog group Media Matters after it published a report that said ads had appeared next to posts supporting Nazism.X, which the billionaire Musk bought in 2022, sued Media Matters last year, alleging the group defamed the platform. The lawsuit will go to trial in Fort Worth, Texas, next year. Media Matters has called the lawsuit meritless.X has also filed an antitrust lawsuit accusing several advertisers of conspiring to stage a boycott, causing it to lose revenue. Both of X’s lawsuits were initially assigned to the US district judge Reed O’Connor, a Fort Worth judge who once declared the Obamacare health insurance law unconstitutional in a ruling that was later overturned. He has since blocked Biden administration policies on gun control and LGBTQ+ rights.The judge, an appointee of George W Bush, the Republican former president, stepped aside from X’s antitrust case in August after National Public Radio reported that financial disclosure reports showed O’Connor had owned shares of another Musk company, Tesla. But the judge has declined to recuse himself from the Media Matters case.O’Connor is one of two active judges in Fort Worth’s federal courthouse. The other is Mark Pittman, a Trump appointee. More

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      Trump vows to impose tariffs as experts warn of price hikes and angry allies

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      Donald Trump doubled down on his promise to levy tariffs on all imports in a bid to boost American manufacturing, a proposal that economists say would probably mean higher prices for consumers while angering US allies.“To me, the most beautiful word in the dictionary is ‘tariffs’,” Trump said in an often-combative conversation with John Micklethwait, editor-in-chief of Bloomberg News, at the Economic Club of Chicago on Tuesday. “It’s my favorite word.”Trump was grilled on the potential impacts of tariffs, and often dodged questions about the tangible impacts of the levies on inflation and geopolitics. Trump is proposing an at least 10% blanket tariff on all imports, with tariffs as high as 60% on goods from China.“You see these empty, old, beautiful steel mills and factories that are empty and falling down,” Trump said. “We’re going to bring the companies back. We’re going to lower taxes for companies that are going to make their products in the USA. And we’re going to protect those companies with strong tariffs.”

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      Though speaking in Chicago, Trump repeated many of the claims he made at the Detroit Economic Club last week. At the time, Trump bashed the city, saying it has a high crime rate and few job opportunities.“We’re a developing nation, too,” he said on Tuesday. “Take a look at Detroit.”Trump centered the auto industry, claiming that tariffs would encourage car manufacturers to build plants in the US – an assertion some economists have suggested amounts to wishful thinking.“The higher the tariff, the more you’re going to put on the value of those goods, the higher people are going to have to pay,” Micklethwait told Trump.“The higher the tariff, the more likely it is that the company will come into the United States and build a factory,” Trump said in response, to applause from the audience.Micklethwait pointed out that economists have estimated Trump’s economic proposals would add $7.5tn to the US deficit, twice the amount as Kamala Harris’s proposals. He also pointed out that the tariffs would also be targeting American allies.“Our allies have taken advantage of us, more so than our enemies,” Trump said.When asked whether he had talked to Vladimir Putin after the end of his presidency, Trump said that he doesn’t “comment on that, but I will tell you that if I did, it’s a smart thing”.“If I’m friendly with people, if I can have a relationship with people, that’s a good thing, not a bad thing,” he said.Trump was also asked about his stance on the Federal Reserve, specifically on comments he has made against Fed chair Jerome Powell, whom Trump first appointed in 2018.“I think if you’re a very good president with good sense, you should at least get to talk to [the Fed],” Trump said. “I think I have the right to say, as a very good businessman … I think you should go up or down a little bit.“I don’t think I should be allowed to order it, but I think I have the right to put in comments as to whether or not interest rates should go up or down.”Even a recommendation from the White House as to what the Fed should do with interest rates would amount to a significant step away from the central bank’s long-established independence.Trump frequently made personal jabs at Micklethwait, saying “I know you’re an anti-tariff guy” and at one point: “This is a man who has not been a big Trump fan.” More

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      This is the future for Kamala Harris: unless she solves this economic mystery, Trump wins | Aditya Chakrabortty

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      The defining question in US politics was asked 44 years ago this month. One week before the 1980 presidential election, Ronald Reagan and Jimmy Carter squared up to each other for a televised debate. A former Hollywood actor, Reagan was also proving a lethal Washington aphorist. At the close, he spoke into the camera: “Next Tuesday, all of you will go to the polls. You’ll stand there in the polling place and make a decision.” Watching at home were more than 80 million Americans. “When you make that decision … ask yourself: are you better off than you were four years ago?” Is it easier to buy things, he asked, is unemployment lower?A few days later, voters gave their answer, handing Reagan a 44-state landslide. Every presidential contest since has been framed in large part by his simple, deadly question. Ask it in the final stretch of this election and you get to the great mystery of why the race remains so close.Are Americans better off than they were four years ago? Pretty much every mainstream economist would say: you bet. Many go further. “I’ve hesitated to say this at the risk of sounding hyperbolic,” wrote Mark Zandi, the respected chief economist at Moodys, just a few days ago. “But … there is no denying it: this is among the best performing economies in my 35+ years as an economist.” Growth: up. Jobs: up. Wages: rising. The value of your home: up. Share prices: booming. Inflation: falling. Borrowing rates: dropping.In 2020, Donald Trump warned that his defeat would produce “a depression”. Today, even while Germany and Japan face recession, magazines toast the US economy’s “superstar status”. Yet ask Americans if they feel better off, and many answer: no.Under Reagan’s law, this election ought to be in the bag for Kamala Harris. As Joe Biden’s number two, she can claim co-authorship for this boom. Instead, she is neck and neck with a convicted criminal (never forget: three weeks after polling day, a judge will decide if Donald Trump should be jailed over the hush money paid to Stormy Daniels). On the economy, Trump regularly polls ahead of Harris. The issue that ought to be winning for her is instead losing.How come? It ranks among the most consequential questions of our time, yet, however hard they scratch their heads Washington’s finest can’t give a good answer. Many on the centre left paint it as a PR problem: that Biden has failed to claim the credit or that voters are too dumb to realise how good things are. But another suggestion emerges in a new report from a progressive thinktank, the Democracy Collaborative. And its argument should be heeded by Keir Starmer and the European left.The authors examine much the same economic dashboard as everyone else – growth, jobs, wages – but over a far longer timeframe. Behind each graph lies the implicit question: are you, your family, your community better off than you were not four years ago, but two, three, four decades ago? And for many people the numbers say: no.Take the biggest one: pay. For teachers, clerical workers, sales reps and the great bulk of US employees, whether white or blue collar, wages have flatlined – not for four or even 20 years – but for most of the past half century. Strip out inflation and average hourly earnings for seven out of 10 US employees have barely risen since Richard Nixon was in the White House.For the average US employee, and their families and their towns, the economy has kept on tanking whoever wins the White House, whichever judges make it to the supreme court, whether the analysts decree it to be boom or bust.Biden has spent trillions on boosting the economy and adapting to the climate crisis. He has bolstered unions and intervened in strikes. The graphs show it has had an impact – but it is a tiny uptick at the end of a line that otherwise points remorselessly down. Americans are better off than they were four years ago, it’s just that many were in distress in 2020.Reagan destroyed their unions, Bill Clinton threw open their trade barriers, George Bush Jr dispatched their kids to fight and die abroad, Barack Obama bailed out Wall Street and Trump ran a glorified protection racket. Only in 2020 did real wages for “production and non-supervisory employees” rise above where they were in 1973. This was not because they were unproductive: the US economy continues to do more with less almost every year. It’s just that most of the gains from that have gone to the top.“Even if Trump loses, America remains very vulnerable to a far nastier imitation winning next time,” says Joe Guinan, president of the Democracy Collaborative. The only way to see off Trump, JD Vance and the pluto-populists is to make the economy more equal, to give workers more of a stake in the riches they produce.To see how that plays out, I checked in on Mike Stout. We first talked in a diner in Pittsburgh in 2012, the year Obama won re-election. Mike and his wife, Steffi, had worked in Pennsylvania’s steel industry, with good union pay and pensions. They’d gone to Washington for the first inauguration of Obama, and stood in the freezing January cold. They had hopes.The Stouts did everything right. Worked hard and saved, and spent $50,000 to get their kids through university. In 2012, their daughter Maura was working in a downtown hotel for $14 an hour, the same as her father had earned in 1978. Even then she doubted whether she and her husband would ever enjoy the same standard of living as her parents.She’d lost that hotel job during the pandemic, said Mike, and was working from her one-bedroom flat. Her job was chasing people for their debts, even though at $18 an hour she was only just keeping her head above water. Now in her 30s, she’d split from her husband, and Mike thought much of the blame lay in money problems. As for his son, Mike, he was looking after his wife, who has stage 4 cancer, and their kids. Mike has health insurance, which counts as good fortune in the US, but the top-up fees are eye-watering, and now he works two jobs.“They are teetering on a ledge 60 floors up,” said Stout. “The slightest nuance – a recession or prices going up again – and they’re pushed out of the window.”Life for the Stouts has been frozen for years. At the root of democratic capitalism is an old promise: tomorrow will be better than today. But that promise was broken long ago for Mike’s family and many of his friends’ households, too. He knew plenty of former steelworkers in this swing state who next month would vote Trump. Sure he was a liar, “but at least he lies to their faces, rather than ignoring them”.And what about Mike? “Trump or Harris: it’s just one big uni-party,” he said. “It’s Wall Street that runs this country.”

      Aditya Chakrabortty is a Guardian columnist More