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      Ireland prices corporation tax loss from Trump policies at €10bn

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      Ireland’s prime minister has said the country could lose €10bn (£8.35bn) in corporate tax if just three US multinationals were repatriated to America under a hostile Donald Trump administration.His remarks come just days after Trump nominated the Wall Street investor Howard Lutnick to lead the Department of Commerce with direct responsibility for trade.While Trump has already warned he would impose tariffs on EU imports, Lutnick has singled out Ireland for criticism saying “it is nonsense that Ireland of all places runs a trade surplus at our expense”.Simon Harris said if he was returned as taoiseach in Friday’s general election, he would immediately seek engagement with Trump. He has also proposed an early EU-US trade summit to avert damage in trade ties with the overall European trade bloc.“If three US companies left Ireland it could cost us €10bn [£8.5bn] in corporation tax,” Harris said on Monday while canvassing in Dundrum, Dublin.“I’m not pre-empting it, I’m not saying that’s going to happen, I’m not predicting it, but that is the level of risk that our economy is exposed to,” he said.Ten multinationals account for 60% of Ireland’s corporate tax receipts, with Microsoft, which books some global as well as EU revenues through Ireland, thought to be the single biggest contributor.Ireland’s goods trade surplus with the US is now a record €35bn with Irish goods exports up by 8% in the first eight months of 2024, boosted by the pharmaceutical and chemical sectors.Goods exported to the US totalled €45.5bn between January and August, according to the government’s Central Statistics Office, compared with imports of €11bn for the same period.Harris said he had no reason to believe that Trump was not “serious about pursuing the policies that he has campaigned on”, which includes repatriating jobs and profits that he believes should be homegrown.skip past newsletter promotionafter newsletter promotionHe also referenced the Wall Street Journal article on what it said was the “US tax system blows a windfall into Ireland” fuelling savings into not just one but two sovereign wealth funds, including a €14bn windfall in back tax from Apple on the foot of a European court of justice ruling.“The Wall Street Journal front page gives an indication here” that Trump is intent on action, said Harris.However, he said Ireland would be prepared and would cope just as it did with “Brexit, Covid [and the] cost of living crisis”. More

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      Trump advisers contemplating cuts to Medicaid and other welfare programs

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      Donald Trump’s economic advisers and congressional Republicans are discussing possible cuts to Medicaid, food stamps and other government welfare programmes to cover the costs of extending the president-elect’s multitrillion-dollar 2017 tax cut.The cuts could mean new work requirements and spending caps, according to the Washington Post, citing sources involved in the talks, including aides in Trump’s transition team.Extending the tax cuts – most of which are due to expire next year – could add $4tn to the national debt, which already stands at $36tn.But Republicans fear triggering a political backlash by slashing programmes that serve an estimated 70 million Americans to pay for a tax cut that disproportionately benefits the wealthy.The 2017 tax cuts were criticised for being skewed in favour of the rich, with households in the top 1% income bracket receiving a reduction of $60,000 in 2025, compared with less than $500 for those in the bottom 60%, according to the Center on Budget and Policy Priorities.Trump campaigned on extending the 2017 reduction while also vowing to abolish taxes on tips for restaurant workers.Republicans support the extension but worry that the loss of revenue could add to government borrowing – prompting them to search for savings in others areas.In addition to safety net programme cuts, some Republicans are considering re-purposing clean energy funds passed by Democrats.The GOP has warned that the costs of Medicaid – whose claimants can include low-income people, newborns, people who are blind or disabled, and those suffering from certain illnesses – has ballooned with the expansion of the Affordable Care Act, also known as Obamacare.Jodey Arrington, the chair of the House of Representatives’ budget committee, told reporters that a “responsible and reasonable work requirement” could save $100bn in Medicaid costs, while another $160bn could be cut by checking eligibility more than once a year.The Paragon Health Institute, a rightwing thinktank, published a study in the summer proposing other reductions that it said could save $500bn over a decade. It said rule changes to Medicaid recently enacted over the past year by the Biden administration could cost up to $135bn nationally and between $46.3bn and $82.3bn at state level over the next five years.Alterations to food stamps – officially known as the Supplemental Nutrition Assistance Program – could take the form of limiting which items recipients can purchase with benefits or broadening work requirements. The latter proposal was floated in the Heritage Foundation’s Project 2025 blueprint for radically overhauling US government.Qualifying criteria are tailored to assist the poorest households, with eligibility determined by income and household size. A single person with no dependents needs to be earning less than $1,354 a month to qualify. A household with two or more people but earning $1,800 per month would also be eligible.The projected cuts to welfare entitlement programmes come as the Republicans prepare to control the White House and both chambers of Congress following this month’s election.It also coincides with Trump’s choice of Elon Musk, the Tesla and Space X entrepreneur, to head a newly formed Department of Government Efficiency along with Vivek Ramaswamy, his former Republican primary opponent, with the brief of slashing waste from federal spending. Musk has spoken of making around $2tn in spending cuts.The US is currently running a budget deficit at around 6% of its gross domestic product. The national debt held by the public is currently worth around 97% of the national economy.The non-partisan Committee for a Responsible Federal Budget has argued that, without major spending reductions, the deficit would widen significantly in the next 10 years, while the US national debt could soar to 143% of the economy. More

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      If the US is heading for a soft landing, why do people feel so hard up?

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      The last few months have been filled with great news, according to US economists. Inflation is a hair’s breadth from pre-pandemic levels, unemployment is close to a 50-year low. The stock market keeps hitting record highs. The Federal Reserve cut interest rates last month, the first time since 2020. Some economists have gone so far as to say that the economy we’re living in is one of the best seen in decades.And yet, as the US heads to the polls, many Americans believe the economy stinks. It’s a disconnect that could ultimately decide who takes the White House.Paul Spehar, 62, a maintenance technician based in Daytona Beach, Florida, has seen reports that the economy is doing well but has only seen his savings chip away. His car insurance tripled over the last three years, and he had to take on $2,000 in debt to pay for the copay of a recent surgery. When Spehar retires, he will have to rely solely on Social Security.“The system doesn’t work for people like me,” Spehar said.It’s a common sentiment. In a Harris Poll conducted exclusively for the Guardian in September, nearly 50% of Americans believed that the country is experiencing a recession. Over 60% believed that inflation is increasing, and 50% believed that unemployment is increasing too. Even those who may know what the economists are saying don’t feel great: 73% said it’s hard to feel good about any positive economic news when they feel financially squeezed each month.As election day draws closer, and voters consistently say that the economy is their number one issue, the stakes of understanding why voters feel so blue has never been higher. So why do economists and everyday Americans seem to live in two different realities? The answer may come down to how they view inflation.For economists, inflation is a “nominal thing”, said Stefanie Stantcheva, an economist at Harvard. In other words, for economists, inflation is a measure – an important measure, especially for the Federal Reserve, which is tasked with adjusting monetary to control inflation. But for everyday Americans, inflation is a lived experience.“[Lived experiences] teach us a lot, and they show us that people are suffering a lot from inflation, perhaps more than the baseline numbers say,” Stantcheva said. “I think it’s very important to not just look at that number and say ‘Oh, but this is what CPI [the consumer price index, a broad measure of inflation] says.’… People have a different experience from that, and those experiences should be taken seriously.”That “nominal” number elicits feelings of anger, fear, anxiety and stress – along with a sense of inequality and injustice, when people are asked open-ended questions about how inflation makes them feel, said Stantcheva.People “think that wages are not keeping pace with prices at all, and so their standards of living are eroding,” Stantcheva said. “Inflation affects us as consumers, as workers, as asset holders, and also emotionally. And we see that lots of people, especially lower-income ones.”Inflation peaked in the summer of 2022 at 9.1% – the highest it had been since the early ’80s. It would take over two years for inflation to get back to levels under 3%. The Federal Reserve started ratcheting up interest rates, making the cost of borrowing money more expensive, to tackle rising prices. It has worked, but for many, the economic data and the reality of lived experiences have diverged.For economists, it seems likely that the Federal Reserve pulled off what they call a “soft-landing” – a rare feat where inflation goes down, but the unemployment rate remains relatively low. The opposite, a “hard-landing” – which many economists had forecast – would have meant that unemployment would go up as inflation goes down, triggering a recession.But for many Americans, this is anything but a soft-landing.Inflation coming down doesn’t mean prices have come down, which would be deflation, something economic theory says would actually be a bad sign for the economy. So prices have and will remain elevated. Food prices, for example, went up 25% between 2019 and 2023, according to the US Department of Agriculture.The impact of higher interest rates has also taken time to ripple through the economy, so in addition to inflation, Americans are also still getting hit with high interest rates. As prices increased, so did the cost of buying a home, getting a loan for a car and the rates on credit card bills.What economists call a soft-landing “is diametrically opposed to ordinary Americans, who see themselves in the middle of turbulence”, said John Gerzema, CEO of Harris Poll.While economists – and the Biden administration – celebrate low unemployment, it’s harder for everyday Americans to appreciate the good news even if they still have their jobs.“Unemployment is highly personal when it happens to you,” Gerzema said. But for most people, unemployment is not a big factor in their lives. “But inflation is personal and persistent. Every week it’s changing your benchmark.”MaryKate, 25, who requested she be identified by only her first name for fear of professional repercussions, said that she is still living at home with her parents because rent has been too expensive. When she graduated from college in 2021, it took her a year to find a full-time job with benefits, and saving up to move out has been hard. She recently got financing for a new car, which she uses to commute to work.“I didn’t intend to be at home for this long,” MaryKate said. “It’s hindering my personal growth.”MaryKate said she thinks about how her parents were able to move up from the lower middle-class to a middle-class during their life, and doesn’t feel like the mobility they experienced is possible for her.“At least in my family, that was kind of always the thought, that the next generation does better than the previous one,” she said. “I don’t know if that’s necessarily going to be the case for me.”It’s a sentiment that many Americans share. In the September Harris/Guardian poll, 42% of Americans said they are not financially better off today than their parents were at their age.The one thing that Donald Trump and Kamala Harris seem to agree on is that inflation has hurt Americans, and they are acting accordingly. It’s why Trump proposed ending taxes on tips at a rally in Las Vegas and Harris has shifted her emphasis away from Bidenomics – investing in infrastructure, boosting the US chip industry – to putting housing costs and crackdowns on price gouging at the center of her economic proposals.Gerzema says these kinds of policies are “personally relevant appeals” that focus on the granular “pixels” of the economy, not the overall picture. Purchasing power, personal sentiment on job security, student loans, the price of gas – are all pixels that make up the picture of a person’s individual economy.“I think the pixels just become so incredibly important because when you look at those, you really start to understand a different picture,” Gerzema said.Both presidential candidates seem to understand that much of the election hinges on these emotions. This week, voters will choose who they think has understood them best. More

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      ‘No social life, no plans, no savings’: Americans aren’t reaping benefits of booming US economy

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      Experts seem to agree the US economy has been on the upswing in 2024. A wave of new jobs, robust consumer spending, lower interest rates, falling inflation, impressive levels of business investment and record Wall Street highs has made the US economy “the envy of the world”.But many Americans appear to feel very little of that.Jim White, 62, an aquaculture specialist from North Carolina, said he has “given up [on] going out”.“I’ll never own a home. A new car is unthinkable,” he said. “The economy is slowly making the rich richer. Everyone else is sinking.”White is among dozens of people from all over the US who shared with the Guardian how they feel about the economy.While some expressed general optimism about stabilizing levels of inflation and reported doing well economically, scores said inflation continued to be financially crippling, with their incomes not even remotely keeping up with soaring costs for housing, food, childcare, insurance, healthcare, fuel, subscriptions and entertainment.Few seemed impressed by months of positive headlines about slowing inflation: “It’s not as if prices have come down, they’ve just stopped rising as obscenely as before,” as one woman in her 70s from Arizona, who still works part-time, put it. “Am I supposed to be happy about that?”“It’s more manageable, but prices are still too high for our wages compared to pre-pandemic,” said a 36-year-old woman from Salt Lake City who works as a research associate.Even those who felt the economy was doing very well complained of the exorbitantly high cost of living.The economy, 40-year-old Roxanne Oesch from Missouri said, felt “remarkably strong”.“Good jobs are available, interest rates are down and will come down further, and inflation has flattened out. It seems like there is a lot of good news.”But simultaneously, she added, “most people still cannot enjoy the same level of financial security they had pre-pandemic”.Alongside various young people who expressed dismay about their economic outlook were dozens of pensioners and people surviving on social security, for whom the new lower interest rates are bad news. “Interest on savings is dropping, [which is] challenging for retirees on fixed incomes,” said retired 71-year-old Paul Ames from Bellport, New York.“The US is doing a lot better than other developed economies. Gas is still way cheaper than Europe,” said Toni, a retired woman from North Florida, who was among various respondents who felt very positive about the economy because they held stock market investments that had been making healthy gains in recent months.“Things are good. The stock market has done well this year. Inflation isn’t having much impact.”“It’s great,” said 69-year-old Timothy Crowley, from Honolulu. “Investment income rising. This is the best economy on earth.”Respondents from places including New York City, Miami and Milwaukee pointed to rising levels of homelessness in their communities and felt that the US economic trickle-down model was broken.Views on who was responsible for America’s economic shortcomings were split: while some blamed the Biden administration for triggering soaring levels of inflation and rising asset prices through unprecedented interventions to keep the economy afloat during the pandemic, others blamed the previous Trump administration and the larger structural economic system propped up by Wall Street and the Republicans.Alex, a married father of two in his mid-30s from rural North Carolina, said he retrained as a welder during the pandemic, thanks to financial government assistance, but he quickly felt exploited in his new line of work.“I welded in two factories, each making millions in profits every year, and never made it off of government assistance, including food stamps and Medicaid. I’m back in school now and succumbing to the student loan vampires, to try and make it work,” he said.Alex said he has turned his back on Republicans, partly because of his economic concerns.Recent eye-wateringly high levels of inflation “were 25-percent caused by circa 15 years of quantitative easing, and 75-percent [caused] by corporate greed. I have completely abandoned the Republican party because they just refuse to rein in these economic monsters”.White, the aquaculture specialist from North Carolina, also said that he became a swing voter because of the economy.He will “vote a straight blue ticket until they turn their backs on Trump and the religious authoritarians”, White said. “I’m retiring this year and believe Trump’s tax breaks for the rich have already endangered my social security. He’s also a threat to my healthcare.”Among the respondents who expressed high levels of hopelessness were various college-educated people with established professional careers, such as architects, lawyers, engineers and medics, who said they were worried about financial insecurity, had recently been priced out of their longstanding communities or had been unable to save for retirement.“It’s horrific,” said 34-year-old Julia, a marketing professional from Washington. “It shouldn’t cost this much for basic necessities. I can’t do anything but work and go to the gym now,” she said, a remark that was echoed by many. “No social life, no plans, no savings.”“‘The US economy’ is not a meaningful or useful concept for most Americans,” said Karena Youtz, 54, a bookkeeper from Idaho. “Inflation is horrible. Around 40% of people in Idaho were fully employed and still unable to afford the cost of living here in 2019. I have no idea what that figure is now, but it’s probably much higher.”Melissa, retired, from northern California, who is disabled, reported struggling to get by on her social security payments.“Everything is too expensive, my rent keeps rising faster than my social security benefits and food prices are too high. Medical services in my rural area are far too few and far too substandard,” Melissa said.“The economy is doing fine and dandy. It’s the citizens of this country that are suffering.” More

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      Were you better off four years ago? Seven US voters weigh their options

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      This story is co-published with and supported by the journalism non-profit the Economic Hardship Reporting ProjectThis election may well come down to one critical question: whether voters feel like they are better off now than they were four years ago. Although experts say important economic metrics are doing well or trending in a positive direction, some Americans may not feel it when they stress about their tight budget.Like many Americans, I’ve experienced my share of financial challenges. At the end of last year, a contract gig I’d had for five years – one that represented more than half my income – suddenly ended due to lack of funding. During the past year, other members of my household experienced a job loss or significant reduction in their work hours.Our household income is now roughly 25% of what it was two years ago. We survive on much less, with each dollar stretched thin as we’re feeling the impact of rising interest rates and the rapidly increasing cost of essentials like groceries.Much of this can be linked to the pandemic. Almost everything we buy is more expensive – in large part due to corporate greed. Businesses, including grocery stores, that hiked their prices during the pandemic kept them high. Layoffs are happening everywhere as companies that received pandemic-related assistance like Paycheck Protection Program (PPP) loans – which in some cases required them to maintain staffing levels – seem to have reached a point where they feel comfortable reducing their workforce.With the aftermath of economic uncertainty still hanging over the country, I reached out to voters to see how their financial situations will influence their decision this election.Sa’iyda Shabazz, 38View image in fullscreenLocation: Los Angeles, CaliforniaOccupation: digital media editor/creatorHousehold: lives with wife, 44, and son, 11Shabazz has become adept at financial juggling. Her total annual household income is less than $70,000 – which doesn’t go far in an area with a high cost of living. “Rent is almost $4,000 a month not counting utilities,” she says. Groceries are the family’s other biggest expense. “We spend easily $300-$400 a month for a family of three that includes a growing boy who likes fruit. Everything has gotten more expensive. Groceries, gas, rents.”Shabazz works in digital media, and says: “My opportunities to work have slowed considerably, which has majorly impacted my ability to make money and stay above water when it comes to affording life. We try to tighten the purse strings, but there aren’t any to tighten.”Shabazz plans to vote for Kamala Harris, saying: “As a low-income person, I can’t fathom voting for Trump, whose solution to current economic issues is to make other countries pay for our problems. I’m definitely paying attention to the Harris campaign’s stances on inflation, price gouging, and how she plans to handle things like grocery prices and gas prices …“I really hope that they look into the astronomical rise in housing costs. Housing eats up so much of our monthly finances, and there’s no reason for it.”Melanie Sparks, 49Location: Lexington, KentuckyOccupation: small-business ownerHousehold: lives with husband, 56, and daughter, 13.View image in fullscreenSparks, who describes her income as lower-middle to middle class, says her mortgage is her largest expense – currently almost $1,800 including the loan, home insurance and property taxes: “The payment has steadily increased every year since we bought it in 2020.” The family’s second-largest expense is food, including groceries and restaurants, which in total costs $1,200-$1,500 in a typical month.Then there are unpredictable expenses, like needing new tires or her dogs getting sick. Sparks says her business isn’t doing as well as it was a few years ago, and revenue has dropped by 20-30%: “Just about every expense has gone up, from the mortgage increasing $90 a month this summer, to the propane budget plan going up $50 a month. Car insurance is up; food costs are up; interest rates on my credit card debt went up. …“It feels like I’m drowning … We are one crisis away from going broke.”Sparks’ biggest concern this election is the economy, but she isn’t excited about the choices. “Frankly, I’m sick of the arguing and pettiness from both parties and wish we had a viable third party. I’m not confident in either candidate at this point. And I’m anxious about what will happen after the election, regardless of who wins,” she says.Anne MarshLocation: North CarolinaOccupation: nannyAnne Marsh recently moved from Texas to North Carolina with the family she nannies for, receiving a 20% raise from last year. “In 2020, when Biden/Harris were elected, I was ‘temporarily retired’ (read: unemployed), but I had a healthy inheritance to live on, thanks to my aunt and uncle,” she said. Since then, she said, prices have increased around her but she’s been using loyalty cards and other discounts to make do.There’s no doubt in Marsh’s mind about whom to support in this election. “I’m a die-hard Harris voter,” Marsh says, noting she would have voted for Biden if he had stayed in the race. “I think the president has done an incredible job of pulling us out of some of the debt that [Trump] incurred, as well as ensuring that unemployment and job growth have gone in the right directions and getting us through most of Covid without requiring us to drink bleach or use lights on our insides.”Marsh is also basing her vote on the reproductive health issues, saying: “Most of all, I’m voting for Harris and Walz because they’re actual human beings with sympathy and empathy and consideration for others, unlike their opposition.”Leigh Shulman, 52Location: Argentina, but votes as a Georgia overseas voterOccupation: author and writing mentorHousehold: lives with husband, 52, and son, 10. Also has a daughter, 20, who is away at collegeView image in fullscreenShulman, who describes her household income as upper middle-class, says her family is doing better financially than during the last year of the Trump administration: “My financial situation is better now than it was four years ago. Our investments have gone up quite a bit. I live in Argentina, where the dollar goes farther, and while inflation here has been awful, the dollar rate to peso rate means we don’t pay more for things than we did four years ago.”How does their financial situation affect her vote? “Not at all,” she says. “I’d vote for Kamala over Trump any day. To be honest, the idea of having Trump back in the White House is horrifying. He was so much worse than I thought he’d be the first time around. I can’t imagine what he’ll do this time. But this isn’t a hold-your-nose-and-vote situation for me, though. I’m actually happy to vote for Kamala. The main issues for me are women’s rights and education. Healthcare comes a close second, too. As an educator, I believe a leader who doesn’t support education wants an uneducated populace who won’t push back.”Deseri Eaton, 35Location: Marin county, CaliforniaHousehold: single mother to a 10-year-old sonOccupation: sporadic gig work; currently looking for a jobView image in fullscreenDeseri Eaton and her son are surviving on $1,000–$1,300 per month, mostly income she earns from house-sitting and pet-sitting. Her largest expense is her car payment of nearly $600 (car insurance is about another $200), and her son’s school tuition, along with utility expenses, credit cards and essentials like her son’s braces.“The thing that had the biggest impact was not getting into my master’s program. Leaving me jobless and relying on a stipend I didn’t receive. Also, not getting the free [guaranteed income] pilot money any more,” she says. Eaton had been participating in Marin county’s guaranteed income pilot program, which ended this spring: “I’m trying to get a job. Working my business as much as I can. And might surrender my vehicle, which is the biggest bill right now.”Eaton says she is currently unsure who she will vote for – with so much of her time and energy focused on basic survival, she hasn’t watched any of the debates.Jaclyn Cirinna, 26Location: FloridaOccupation: youth and juvenile justice advocateHousehold: lives aloneView image in fullscreen“The past four years have been a roller coaster, professionally and personally,” Cirinna says. She has worked most recently for a non-profit focused on justice and is pursuing full-time entrepreneurship.“Being my boss allows me to have more flexibility and control over my job security and accommodates my current health needs due to a car accident,” she says. “I moved from Massachusetts to Florida to try and reduce my cost of living, but Florida feels just as expensive.”She says many issues matter to her in this election, saying: “As a woman in her peak childbearing years, I like that Kamala Harris has made reproductive rights a central part of her campaign.” The economy and cost of living are important to her, too, especially in the wake of her recent layoff and health issues that limit the types of work she can do.“I like that VP Harris supports small businesses. I want to hear more about her strategy. Trump constantly talks about fighting inflation and making America affordable, but at what cost? I do not necessarily have faith in his ability to complete this promise. He wants to fix inflation by reducing the rights of immigrants. I do not support this. In general, I wish that both candidates talked about issues that impact everyone – I want community solutions at the forefront, not just for specific Americans. Such as inflation, gas prices, housing accessibility and affordability, food costs, it’s all connected!”Ned Barnett, 73Location: NevadaOccupation: freelance writer and writing consultantHousehold: lives with wifeNed Barnett says his income would probably be considered middle-class. “My wife and I live on social security, plus any gig work we can do,” he says. “She is a highly skilled book editor, and is currently editing a novel. I am a freelance writer and a consultant to other writers, and the money we bring in covers what social security doesn’t, but our income varies.”Barnett says one core issue is very important to him in this election: “With the economy what it is, including rent, we are definitely planning to vote with our wallets.” He notes that the presidential race “has been back and forth, but I think Trump is moving into the lead – not because he’s tamed his wild-man tweets and comments, but because my memory allows me to remember what the economy (and our lifestyle) was four years ago, versus what it is today.“When Trump was president before, our economy boomed. Now, not so much.”Barnett said he didn’t vote for Trump in 2016. “His bombast outweighed his sensible (to us) policy predictions, his tough stance internationally, and all the rest. But he’s a boor. However, we don’t like Hillary, so we voted independent. We knew it was a wasted vote, but we believe in voting. But in 2020, we’d begun to realize that there was more to Trump than Truth Social – his policies worked, the economy worked, and we got by without me having to work more than part time. Now, four years on, we can’t afford even our reduced lifestyle, and want Trump and his ‘magic wand’ back to turn things around.” More

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      To defeat Trump, Harris must talk more about the economy | Robert Reich

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      I don’t know about you, but I’m feeling more anxious about the outcome of the upcoming election. I’m still nauseously optimistic, but the nausea is growing.I’m as skeptical of polls as any of you, but when all of them show the same thing – that Kamala Harris’s campaign stalled several weeks ago, yet Donald Trump’s continues to surge – it’s important to take the polls seriously.The US vice-president will give her closing message to the American people on Tuesday at a rally on the Ellipse on the Washington mall.Over the last several weeks she’s focused on a woman’s right over her body and the rights of all Americans to a democracy. Obviously, Trump threatens both.Tuesday night, though, she needs to respond forcefully to the one issue that continues to be highest on the minds of most Americans – the economy.She must tell Americans simply and clearly why they continue to have such a hard time despite all the economic indicators to the contrary. It’s because of the power of large corporations and a handful of wealthy individuals to siphon off most economic gains for themselves.Most Americans are outraged that they continue to struggle economically at the same time as billionaires are pulling in ever more wealth. Most know they’re paying too much for housing, gas, groceries and the medicines they need. They also know that a major cause is the market power of big corporations.They want someone who’ll stand up to big corporations and the politicians in Washington who serve them.They want a president who’ll be on their side. A president who will crack down on price-gouging, who will bust up the monopolies and restore competition, who will fight to cap prescription drug costs, who will get big money out of politics and stop the legalized bribery that rigs the market for the rich and who will make sure corporations pay their fair share and end tax breaks for billionaire crooks.A president who will put working families first – before big corporations and the wealthy.Harris needs to say she will be this president.Her policy proposals suggest this. She’s committed to strong antitrust enforcement – cracking down on mergers and acquisitions that give big food corporations the power to jack up food and grocery prices, prosecuting price-fixing and banning price gouging. She needs to remind voters of this.She also says she’ll raise taxes on the rich, provide $25,000 in down-payment assistance to help Americans buy their first home, restore the expanded child tax credit to $3,600 to help more than 100 million working Americans, and implement a new $6,000 tax cut to help families pay for the high costs of a child’s first year of life.All should be parts of her speech this Tuesday about why she will be the champion of working people.She wants to raise the minimum wage to $15 an hour, make stock buybacks more expensive and expand Medicare to cover home healthcare – paid for with savings from the expansion of Medicare price negotiations with drug manufacturers.She needs to frame all of this as a response to the power of big corporations and the wealthy – and say in no uncertain terms that she’s on the side of the people, not the powerful.If she fails to do this in her closing argument, Trump’s demagogic response will be the only one the public hears – that average working people are struggling because of undocumented workers and the “enemy within”, including Democrats, socialists, Marxists and the “deep state”.skip past newsletter promotionafter newsletter promotionHarris should fit her message about democracy inside this economic message. If our democracy weren’t dominated by the rich and big corporations, fewer of the economy’s gains would be siphoned off to them. Average working people would have better pay, more secure jobs, and be able to afford homes, food, fuel, medicine, childcare and eldercare.A large portion of the public no longer thinks American democracy is working. According to a new New York Times/Siena College poll, only 45% believe our democracy does a good job representing ordinary people. An astounding 62% say the government is mostly working to benefit itself and elites rather than the common good.In her closing argument, Harris should commit herself to reversing this, so the government works for the common good.Harris started her campaign in July and early August by emphasizing these themes about the economy and democracy. But in more recent weeks, she’s focused on Trump’s threat to democracy. Her campaign seems to have decided that she can draw additional voters from moderate Republican suburban women upset by Trump’s role in fomenting the attack on the US Capitol.That’s why she’s been campaigning with Liz Cheney, and gathering Republican officials as supporters. And why she has chosen to give her closing message on the Ellipse – where Trump summoned his followers to march on the Capitol on 6 January 2021.But when she shifted gears to Trump’s attacks on democracy, Harris’s campaign stalled. I think that’s because Americans continue to focus on the economy and want an answer to why they continue to struggle economically.If Trump gives them an answer – although baseless and demagogic – but Harris does not, he may sail to victory on 5 November.Hence, in her closing message she must talk clearly and frankly about the misallocation of economic power in America – lodged with big corporations and the wealthy instead of average Americans – and her commitment to rectify this.

      Robert Reich, a former US secretary of labor, is a professor of public policy at the University of California, Berkeley, and the author of Saving Capitalism: For the Many, Not the Few and The Common Good. His newest book, The System: Who Rigged It, How We Fix It, is out now. He is a Guardian US columnist. His newsletter is at robertreich.substack.com More

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      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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      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