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      Airlines Hoping for More Boeing Jets Could Be Waiting Awhile

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      The Federal Aviation Administration’s decision to limit Boeing’s production of 737 Max planes could hurt airlines that are struggling to buy enough new aircraft.Boeing hoped 2024 would be the year it would significantly increase production of its popular Max jets. But less than a month into the year, the company is struggling to reassure airline customers that it will still be able to deliver on its promises.That’s because the Federal Aviation Administration said on Wednesday that it would limit the plane maker’s output until it was confident in Boeing’s quality control practices. On Jan. 5, a panel blew off a Boeing 737 Max 9 body shortly after takeoff, terrifying passengers on an Alaska Airlines flight and forcing the pilots to make an emergency landing at Portland International Airport in Oregon. Almost immediately, the F.A.A. grounded some Max 9s.Since then, details have emerged about the jet’s production at Boeing’s facility in Renton, Wash., that have intensified scrutiny of the company’s quality control. Boeing workers opened and then reinstalled the panel about a month before the plane was delivered to Alaska Airlines.The directive is another setback for Boeing, which had been planning to increase production of its Max plane series to more than 500 this year, from about 400 last year. It also planned to add another assembly line at a factory in Everett, Wash., a major Boeing production hub north of Seattle.As part of the F.A.A.’s announcement on Wednesday, it also approved inspection and maintenance procedures for the Max 9. Airlines can return the jets to service once they have followed those instructions. United Airlines said on Thursday that it could resume flying some of those planes as soon as Friday.The move is another potential blow to airlines. Even though demand for flights came roaring back after pandemic lockdowns and travel restrictions eased, the airlines have not been able to take full advantage of that demand. The companies have not been able to buy enough planes or hire enough pilots, flight attendants and other workers they need to operate flights. A surge in the cost of jet fuel after Russia invaded Ukraine also hurt profits.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber?  More

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      Biden Vetoes Republican Measure to Block Electric Vehicle Charging Stations

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      Republicans and some Democrats tried to repeal a waiver issued by the Biden administration that allows federally funded E.V. chargers to be made from imported iron and steel.President Biden on Wednesday vetoed a Republican-led effort that could have thwarted the administration’s plans to invest $7.5 billion to build electric vehicle charging stations across the country.In issuing the veto, Mr. Biden argued that the congressional resolution would have hurt domestic manufacturing as well as the clean energy transition.“If enacted, this resolution would undermine the hundreds of millions of dollars that the private sector has already invested in domestic E.V. charging manufacturing, and chill further domestic investment in this critical market,” Mr. Biden said in a statement.The move comes amid a growing political divide over electric vehicles. The Biden administration is aggressively promoting them as an important part of the fight to slow global warming. The landmark climate law signed in 2022 by Mr. Biden, the Inflation Reduction Act, offers incentives to consumers to buy electric vehicles and to manufacturers to build them in the United States.Republicans, including former President Donald J. Trump, Mr. Biden’s likely challenger in the 2024 election, have attacked electric vehicles as unreliable, inconvenient and ceding America’s auto manufacturing to China, which dominates the supply chain for electric vehicles.Republicans, with some Democrats, voted to repeal a waiver issued by the Biden administration that allows federally funded electric vehicle chargers to be made from imported iron and steel, as long as they are assembled in the United States.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber?  More

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      ¿Qué le espera a la economía global en 2024?

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      Con dos guerras persistentes y la incertidumbre de 50 elecciones nacionales, la inestabilidad financiera podría agravarse en todo el mundo.Los ataques al tráfico marítimo indispensable en los estrechos del mar Rojo por parte de una decidida banda de militantes en Yemen —una repercusión de la guerra entre Israel y Hamás en la franja de Gaza— le está inyectando otra dosis de inestabilidad a una economía mundial que está batallando con las tensiones geopolíticas en aumento.El riesgo de escalada del conflicto en Medio Oriente es la última de una serie de crisis impredecibles, como la pandemia del COVID-19 y la guerra en Ucrania, que han ocasionado profundas heridas a la economía mundial, la han desviado de su curso y le han dejado cicatrices.Por si fuera poco, hay más inestabilidad en el horizonte debido a la oleada de elecciones nacionales cuyas repercusiones podrían ser profundas y prolongadas. Más de dos mil millones de personas en unos 50 países —entre ellos India, Indonesia, México, Sudáfrica, Estados Unidos y los 27 países del Parlamento Europeo— acudirán a las urnas el año entrante. En total, los participantes en la olimpiada electoral de 2024 dan cuenta del 60 por ciento de la producción económica mundial.En las democracias sólidas, los comicios se están llevando a cabo en un momento en que va en aumento la desconfianza en el gobierno, los electores están muy divididos y hay una ansiedad profunda y constante por las perspectivas económicasUn barco cruza el canal de Suez en dirección al mar Rojo. Los ataques en el mar Rojo han hecho subir los fletes y los seguros.Mohamed Hossam/EPA, vía ShutterstockUna valla publicitaria anunciando las elecciones presidenciales en Rusia, que tendrán lugar en marzo.Dmitri Lovetsky/Associated PressWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber?  More

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      Red Sea Shipping Halt Is Latest Risk to Global Economy

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      Next year could see increasing volatility as persistent military conflicts and economic uncertainty influence voting in national elections across the globe.The attacks on crucial shipping traffic in the Red Sea straits by a determined band of militants in Yemen — a spillover from the Israeli-Hamas war in Gaza — is injecting a new dose of instability into a world economy already struggling with mounting geopolitical tensions.The risk of escalating conflict in the Middle East is the latest in a string of unpredictable crises, including the Covid-19 pandemic and the war in Ukraine, that have landed like swipes of a bear claw on the global economy, smacking it off course and leaving scars.As if that weren’t enough, more volatility lies ahead in the form of a wave of national elections whose repercussions could be deep and long. More than two billion people in roughly 50 countries, including India, Indonesia, Mexico, South Africa, the United States and the 27 nations of the European Parliament, will head to the polls. Altogether, participants in 2024’s elections olympiad account for 60 percent of the world’s economic output.In robust democracies, elections are taking place as mistrust in government is rising, electorates are bitterly divided and there is a profound and abiding anxiety over economic prospects.A ship crossing the Suez Canal toward the Red Sea. Attacks on the Red Sea have pushed up freight and insurance rates.Mohamed Hossam/EPA, via ShutterstockA billboard promoting presidential elections in Russia, which will take place in March.Dmitri Lovetsky/Associated PressEven in countries where elections are neither free nor fair, leaders are sensitive to the economy’s health. President Vladimir V. Putin’s decision this fall to require exporters to convert foreign currency into rubles was probably done with an eye on propping up the ruble and tamping down prices in the run-up to Russia’s presidential elections in March.The winners will determine crucial policy decisions affecting factory subsidies, tax breaks, technology transfers, the development of artificial intelligence, regulatory controls, trade barriers, investments, debt relief and the energy transition.A rash of electoral victories that carry angry populists into power could push governments toward tighter control of trade, foreign investment and immigration. Such policies, said Diane Coyle, a professor of public policy at the University of Cambridge, could tip the global economy into “a very different world than the one that we have been used to.”In many places, skepticism about globalization has been fueled by stagnant incomes, declining standards of living and growing inequality. Nonetheless, Ms. Coyle said, “a world of shrinking trade is a world of shrinking income.”And that raises the possibility of a “vicious cycle,” because the election of right-wing nationalists is likely to further weaken global growth and bruise economic fortunes, she warned.A campaign rally for former President Donald J. Trump in New Hampshire in December.Doug Mills/The New York TimesA line of migrants on their way to a Border Patrol processing center at the U.S.-Mexico border. Immigration will be a hot topic in upcoming elections.Rebecca Noble for The New York TimesMany economists have compared recent economic events to those of the 1970s, but the decade that Ms. Coyle said came to mind was the 1930s, when political upheavals and financial imbalances “played out into populism and declining trade and then extreme politics.”The biggest election next year is in India. Currently the world’s fastest-growing economy, it is jockeying to compete with China as the world’s manufacturing hub. Taiwan’s presidential election in January has the potential to ratchet up tensions between the United States and China. In Mexico, the vote will affect the government’s approach to energy and foreign investment. And a new president in Indonesia could shift policies on critical minerals like nickel.The U.S. presidential election, of course, will be the most significant by far for the world economy. The approaching contest is already affecting decision-making. Last week, Washington and Brussels agreed to suspend tariffs on European steel and aluminum and on American whiskey and motorcycles until after the election.The deal enables President Biden to appear to take a tough stance on trade deals as he battles for votes. Former President Donald J. Trump, the likely Republican candidate, has championed protectionist trade policies and proposed slapping a 10 percent tariff on all goods coming into the United States — a combative move that would inevitably lead other countries to retaliate.Mr. Trump, who has echoed authoritarian leaders, has also indicated that he would step back from America’s partnership with Europe, withdraw support for Ukraine and pursue a more confrontational stance toward China.Workers on a car assembly line in Hefei, China. Beijing has provided enormous incentives for electric vehicles.Qilai Shen for The New York TimesA shipyard in India, which is jockeying to compete with China as the world’s largest manufacturing hub.Atul Loke for The New York Times“The outcome of the elections could lead to far-reaching shifts in domestic and foreign policy issues, including on climate change, regulations and global alliances,” the consulting firm EY-Parthenon concluded in a recent report.Next year’s global economic outlook so far is mixed. Growth in most corners of the world remains slow, and dozens of developing countries are in danger of defaulting on their sovereign debts. On the positive side of the ledger, the rapid fall in inflation is nudging central bankers to reduce interest rates or at least halt their rise. Reduced borrowing costs are generally a spur to investment and home buying.As the world continues to fracture into uneasy alliances and rival blocs, security concerns are likely to loom even larger in economic decisions than they have so far.China, India and Turkey stepped up to buy Russian oil, gas and coal after Europe sharply reduced its purchases in the wake of Moscow’s invasion of Ukraine. At the same time, tensions between China and the United States spurred Washington to respond to years of strong-handed industrial support from Beijing by providing enormous incentives for electric vehicles, semiconductors and other items deemed essential for national security.A protest in Yemen on Friday against the operation to safeguard trade and protect ships in the Red Sea.Osamah Yahya/EPA, via ShutterstockThe drone and missile attacks in the Red Sea by Iranian-backed Houthi militia are a further sign of increasing fragmentation.In the last couple of months, there has been a rise in smaller players like Yemen, Hamas, Azerbaijan and Venezuela that are seeking to change the status quo, said Courtney Rickert McCaffrey, a geopolitical analyst at EY-Parthenon and an author of the recent report.“Even if these conflicts are smaller, they can still affect global supply chains in unexpected ways,” she said. “Geopolitical power is becoming more dispersed,” and that increases volatility.The Houthi assaults on vessels from around the world in the Bab-el-Mandeb strait — the aptly named Gate of Grief — on the southern end of the Red Sea have pushed up freight and insurance rates and oil prices while diverting marine traffic to a much longer and costlier route around Africa.Last week, the United States said it would expand a military coalition to ensure the safety of ships passing through this commercial pathway, through which 12 percent of global trade passes. It is the biggest rerouting of worldwide trade since Russia’s invasion of Ukraine in February 2022.Claus Vistesen, chief eurozone economist at Pantheon Macroeconomics, said the impact of the attacks had so far been limited. “From an economic perspective, we’re not seeing huge increase in oil and gas prices,” Mr. Vistesen said, although he acknowledged that the Red Sea assaults were the “most obvious near-term flashpoint.”Uncertainty does have a dampening effect on the economy, though. Businesses tend to adopt a wait-and-see attitude when it comes to investment, expansions and hiring.“Continuing volatility in geopolitical and geoeconomic relations between major economies is the biggest concern for chief risk officers in both the public and private sectors,” a midyear survey by the World Economic Forum found.With persistent military conflicts, increasing bouts of extreme weather and a slew of major elections ahead, it’s likely that 2024 will bring more of the same. More

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      Vibes, the Economy and the Election

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      Recent positive news may put two theories on economic disenchantment to the test.The New York Stock Exchange on Thursday. Stocks have boomed in recent days.Angela Weiss/Agence France-Presse — Getty ImagesA Federal Reserve announcement about the future of the funds rate is not the sort of news that would typically factor into analysis of public opinion and the economy. Usually, analysts look at numbers like gross domestic product and unemployment, not something as arcane as a federal funds rate.But this isn’t a normal economy, and public opinion about the economy hasn’t been normal, either.For two years, the public has said the economy is doing poorly, even though it appears healthy by many traditional measures. This has prompted a fierce debate over whether the public’s views are mostly driven by concrete economic factors like high prices or something noneconomic — like a bad “vibe” brought on by social media memes or Fox News.The Fed’s projection Wednesday that it will cut rates three times over the next year probably won’t generate TikTok memes, but it’s exactly the kind of event that may ultimately resolve this debate one way or another — with important and potentially decisive consequences for the 2024 presidential election.To cut right to the heart of the problem underlying this debate: High prices do not seem to fully explain why voters are this upset about the economy.Yes, voters are upset about high prices, and prices are indeed high. This easily and even completely explains why voters think this economy is mediocre: In the era of consumer sentiment data, inflation has never risen so high without pushing consumer sentiment below average and usually well below average. This part is not complicated.But it’s harder to argue that voters should believe the economy is outright terrible, even after accounting for inflation. Back in early 2022, I estimated that consumer confidence was running at least 10 to 15 percentage points worse than one would expect historically, after accounting for prices and real disposable income.I could run through the numbers, but just consider this instead: The low point for consumer sentiment in 2022 wasn’t just low; it was a record low for the index dating all the way to 1952. That’s right: Consumer sentiment in 2022 was worse than it was in the 1970s, when higher inflation was sustained for much longer, and worse than it was in the depths of the Great Recession.Now, other gauges of consumer confidence don’t show things quite so bad, but even the rosier measures show Americans about as down on the economy as they were 15 years ago, when mass layoffs drove a doubling of the unemployment rate to 10 percent and when household net worth fell $11.5 trillion. You don’t need fancy math to see there’s something left to be explained.The two sides of this debate disagree about why, exactly, the public is so sour on the economy.The Fed chairman, Jerome Powell, on Wednesday.Brendan Smialowski/Agence France-Presse — Getty ImagesThe case for vibesOne side argues that public opinion about the economy is now being driven by noneconomic factors, and in particular vibes, or a prevailing mood that colors our perception of reality. In this view, the vibe today is so biting and dour that public opinion is no longer responsive to material economic reality: The “vibe” is bad, so voters can’t see that the economy is good.Strictly speaking, there’s no reason vibes can’t be grounded in tangible economic conditions — like stimulus checks going away — but in practice this winds up being an argument for how noneconomic factors prevent voters from appreciating the economy. Those factors could include conservative media, cynical social media, the mental health crisis, a pandemic hangover, President Biden or really anything else that might dampen the economic spirit of Americans.There might well be something to the vibes argument. There might even be a lot to it. But there’s just not much evidence to support it. This side fundamentally rests its case on a diagnosis of exclusion: If we don’t buy the economic argument, then it must be noneconomic — and if it’s noneconomic, it can really be anything. The power of vibes here is naturally indeterminate, and allowing limitless explanatory power to a theory without evidence should give any serious thinker some pause.If this side of the debate is right, the consequences for Mr. Biden are pretty bleak. In this view, the economy ought to be helping him, but instead it will presumably be a major drag. An 81-year-old white male moderate may be the worst possible Democrat to turn around the vibe on TikTok.The case for the economy explaining allThe other side of the debate argues that the explanation is fundamentally economic, but that the factors dragging down consumers aren’t neatly captured by the usual economic statistics.There are two kinds of adverse economic factors that this side of the debate has in mind. One is economic dysfunction — some basic things have become harder. It’s harder to hire. It’s harder to get a loan. It’s more expensive to buy things. At times it was impossible to buy things because of supply chain shortages. It’s harder to buy a home. It’s harder to sell a home. If you wanted to engage in these kinds of economic activities, you should have done them before the fall of 2021.It’s easy to see how these challenges could affect economic perceptions, and these problems can be missed by economic statistics. The usual data measures the extent of economic activity, not its ease. That people still have the resources to spend, hire and buy doesn’t change that voters may rationally conclude the economy is bad if it makes it harder for them to undertake economic activity.The other kind of adverse economic factor is the pessimism about future growth. A statistic like unemployment says a lot about the economy today, but little about the economy tomorrow. Expectations of future growth are an important component of consumer confidence indexes, and for good reason: The desire to turn money into more money is foundational to American capitalist culture. Here again, there have been reasons to anticipate limited economic growth or even a recession. Investors have expected it, as evidenced by the yield curve. There was even a reasonable assumption that the Fed would be so focused on slowing inflation by keeping interest rates high that a recession would be all but inevitable.In contrast to the “vibes” theory, there’s a lot of evidence for these various phenomena. They also fit into the framework of consumer confidence as a function of concrete economic conditions.But whether these nontraditional economic problems add up to explain what’s going on is much harder to say. They might explain a lot and might even explain all of it, but it’s impossible to prove empirically without any precedent for today’s economy in the era of modern consumer confidence data. There has simply never been a time when unemployment has stayed so low and prices have gone up so much, let alone with all of these additional twists like supply chain shortages and expectations of recession.What can be said is that the theory of concrete economic problems will be put to the test as soon as economic reality improves, and that time might finally be at hand.Many states now have gas prices below $3 a gallon.Adam Davis/EPA, via ShutterstockThe economy appears to be improvingAfter a few months of stubborn inflation, rising gas prices and interest rates, and a falling stock market, the last month or so has brought excellent economic news. The stock market has gone up nearly 15 percent since New York Times/Siena College polls were in the field in late October. The inflation trajectory looks good. Mortgage rates are falling. Gas prices are down. Once-skeptical economists have declared that a “soft landing” seems at hand. And now the Fed is forecasting rate cuts, which augurs growth, confidence in lower inflation and eventually a return to a more normal economy.Put it together, and the big economic barriers could be poised to fade. If they do and the material economic side of the debate is correct, consumer confidence might quickly begin to recover. And Mr. Biden’s re-election chances would begin to improve, at least to the extent that the economy and not another issue, like his age, is responsible for Donald J. Trump’s lead in the polls.While it’s too early to say, there are certainly signs that consumer confidence could rise. For one, it has already been doing so. Overall, consumer confidence is up nearly 20 points since inflation peaked in the summer of 2022. That rate of improvement is in line with prior, vigorous periods of economic expansion, like during the 1990s. The monthly pattern in consumer confidence even seems to align with the news: Last month’s strong economic data corresponded with a rebound in consumer confidence that erased the declines of the past four months, when the economic news was worse than over the summer.That’s what we would expect if real economic factors were driving consumer confidence, though it’s not enough to disprove the vibe theory. To send the vibe argument away, we would need to start to see the gap closing between expected and actual consumer confidence. If fears of a recession fade and a more normal economic environment returns, there might still be enough time for that gap to close before Mr. Biden stands for re-election. More

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      Biden Highlights Economic Investments Ahead of Expected 2024 Announcement

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      The president has warned that a strong economy could be weakened under Republican leadership, a point he and a host of advisers will make at 20 events across the country in the coming weeks.DURHAM, N.C. — President Biden visited North Carolina on Tuesday and said Republicans would undermine his administration’s gains on American manufacturing, as the president began to sharpen his political message ahead of an expected re-election announcement.Mr. Biden spoke at Wolfspeed, a semiconductor manufacturer that recently announced a $5 billion investment to expand operations in the state, a move that would create about 1,800 jobs, according to the White House. The company, based in North Carolina, has deals to supply the material to General Motors, among other buyers.But Mr. Biden’s visit was less about semiconductors than it was about making an argument that he sees as key to a re-election bid — essentially, that the American economy has recovered since the coronavirus pandemic, his administration has helped keep it strong and Republican policies would undo that progress.“I’ve got news for you and for MAGA Republicans in Congress: Not on my watch,” Mr. Biden said, referring to the far-right wing of the party that is loyal to former President Donald J. Trump.The White House has argued for months that Mr. Biden has presided over a steady economy and strong job growth, but the data presents a more complicated reality: The high pace of job creation is undercut by a continued deceleration in wage increases, and there are growing concerns that the Federal Reserve may move to raise interest rates. The Biden administration has also tried to assuage fears of instability after the collapse of Silicon Valley Bank this month.Mr. Biden’s visit to North Carolina was the start of three weeks of related events to be held across the country by the president and Vice President Kamala Harris, plus their spouses and a host of cabinet officials. The group plans to visit 20 states and will highlight investments in American manufacturing, supply chains and job-creation efforts, according to a summary of efforts sent by the White House.During his trip to Durham, Mr. Biden highlighted legislation passed last year, including the CHIPS and Science Act, which contains $52 billion in subsidies and tax credits for companies that manufacture chips in the United States. More than half of the amount is dedicated to helping companies build facilities for making, assembling and packaging some of the world’s more advanced chips. In his remarks, the president said that over $435 billion had been invested in American companies since he took office.“America’s coming back,” Mr. Biden said, standing beside Gina Raimondo, the commerce secretary, who traveled with him to Durham. “We are determined to lead the world in manufacturing semiconductors.”Ms. Raimondo, who is expected to participate in the tour over the coming weeks, told a crowd gathered at Wolfspeed that the pandemic had “opened all of our eyes” to the importance of maintaining the global supply chain and protecting competitive advantages in technology.“The truth of it is the United States was for a long time a manufacturing powerhouse,” she said. “Still is, but for a long time we took our eye off the ball, and we watched manufacturing leave our shores in search of cheap labor in Asia.”.css-1v2n82w{max-width:600px;width:calc(100% – 40px);margin-top:20px;margin-bottom:25px;height:auto;margin-left:auto;margin-right:auto;font-family:nyt-franklin;color:var(–color-content-secondary,#363636);}@media only screen and (max-width:480px){.css-1v2n82w{margin-left:20px;margin-right:20px;}}@media only screen and (min-width:1024px){.css-1v2n82w{width:600px;}}.css-161d8zr{width:40px;margin-bottom:18px;text-align:left;margin-left:0;color:var(–color-content-primary,#121212);border:1px solid var(–color-content-primary,#121212);}@media only screen and (max-width:480px){.css-161d8zr{width:30px;margin-bottom:15px;}}.css-tjtq43{line-height:25px;}@media only screen and (max-width:480px){.css-tjtq43{line-height:24px;}}.css-x1k33h{font-family:nyt-cheltenham;font-size:19px;font-weight:700;line-height:25px;}.css-1hvpcve{font-size:17px;font-weight:300;line-height:25px;}.css-1hvpcve em{font-style:italic;}.css-1hvpcve strong{font-weight:bold;}.css-1hvpcve a{font-weight:500;color:var(–color-content-secondary,#363636);}.css-1c013uz{margin-top:18px;margin-bottom:22px;}@media only screen and (max-width:480px){.css-1c013uz{font-size:14px;margin-top:15px;margin-bottom:20px;}}.css-1c013uz a{color:var(–color-signal-editorial,#326891);-webkit-text-decoration:underline;text-decoration:underline;font-weight:500;font-size:16px;}@media only screen and (max-width:480px){.css-1c013uz a{font-size:13px;}}.css-1c013uz a:hover{-webkit-text-decoration:none;text-decoration:none;}How Times reporters cover politics. We rely on our journalists to be independent observers. So while Times staff members may vote, they are not allowed to endorse or campaign for candidates or political causes. This includes participating in marches or rallies in support of a movement or giving money to, or raising money for, any political candidate or election cause.Learn more about our process.The president spoke directly to people he said might feel “left behind” by technological changes, but said his administration would focus on programs that could train workers to produce technological projects without a college degree. Mr. Biden said the “vast majority” of jobs created by Wolfspeed would not require college degrees and could pay around $80,000.Events like the one held on Tuesday will provide Mr. Biden and his surrogates with an opportunity to hone his argument against Republicans.At the same time, a collision course looms in Washington over the debt ceiling.On Tuesday, Speaker Kevin McCarthy, Republican of California, wrote a letter urging the president to negotiate on the federal debt limit. “With each passing day,” Mr. McCarthy wrote, “I am incredibly concerned that you are putting an already fragile economy in jeopardy by insisting upon your extreme position of refusing to negotiate any meaningful changes to out-of-control government spending.”Mr. Biden has said he will refuse to negotiate on the debt limit, pointing out that Republicans voted to raise the ceiling several times under his predecessor, Mr. Trump.“It’s time for Republicans to stop playing games, pass a clean debt ceiling bill and quit threatening our economic recovery,” Karine Jean-Pierre said in a statement responding to Mr. McCarthy’s letter.In his own letter sent on Tuesday evening, Mr. Biden urged Mr. McCarthy and congressional Republicans to present a full budget proposal before Congress leaves for Easter recess.The president and his advisers have signaled that the situation would be worse under Republican leadership, a point he underscored in North Carolina. The White House says that companies have made $16 billion in private sector investment commitments since Mr. Biden took office, a development they have attributed to corporations taking advantage of tax breaks and federal funding that bolsters innovation.Mr. Biden has argued that the flow of money would be at stake if Republicans tried to repeal policies passed under his administration, including the Inflation Reduction Act. He has also said that individual Americans are at risk of losing access to lower health care, energy and internet costs that are provided for in the bills that were passed by a Democratic-majority Congress.“We’re not going to let them undo all the progress,” Mr. Biden said. More

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      Fact-Checking a GOP Attack Ad That Blames a Democrat for Inflation

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      In a Nevada tossup race that could help decide whether Republicans gain control of the House, a super PAC aligned with congressional G.O.P. leaders recently mounted an economically driven attack against Representative Dina Titus.In a 30-second ad released on Saturday, the Congressional Leadership Fund accused Ms. Titus, a Democrat who represents Las Vegas, of supporting runaway spending that has exacerbated inflation.Here’s a fact check.WHAT WAS SAID“Economists said excessive spending would lead to inflation, but she didn’t listen. Titus recklessly spent trillions of taxpayer dollars,” the ad’s narrator says, and, later: “Now we’re paying the price. Higher prices on everything. Economy in recession. Dina Titus. She spent big … and we got burned.”This lacks context. The implication here is that Democrats’ policies led to inflation. We recently put this question to our economics correspondent, Ben Casselman, who said: “True, although we can argue all day about how much.”He explains: “Here’s what I think we can say with confidence: Inflation soared last year, primarily for a bunch of pandemic-related reasons — snarled supply chains, shifts in consumer demand — but also at least in part because of all the stimulus money that we poured into the economy. Then, just when most forecasters expected inflation to start falling, it took off again because of the jump in oil prices tied to the war in Ukraine.The State of the 2022 Midterm ElectionsWith the primaries over, both parties are shifting their focus to the general election on Nov. 8.A Focus on Crime: In the final phase of the midterm campaign, Republicans are stepping up their attacks about crime rates, but Democrats are pushing back.Pennsylvania Governor’s Race: Doug Mastriano, the Trump-backed G.O.P. nominee, is being heavily outspent and trails badly in polling. National Republicans are showing little desire to help him.Megastate G.O.P. Rivalry: Against the backdrop of their re-election bids, Gov. Greg Abbott of Texas and Gov. Ron DeSantis of Florida are locked in an increasingly high-stakes contest of one-upmanship.Rushing to Raise Money: Senate Republican nominees are taking precious time from the campaign trail to gather cash from lobbyists in Washington — and close their fund-raising gap with Democratic rivals.“Now, inflation is falling again. Overall consumer prices were up just 0.1 percent in August, and a separate measure showed prices falling in July. But a lot of that is because of the recent drop in gas prices, which we all know could reverse at any time. So-called core inflation, which sets aside volatile food and energy prices, actually accelerated in August.“All of which means we don’t know how long the recent pause in inflation will last, and we definitely don’t know whether Biden will get credit for it if it does.”Backing up a bit, it’s worth noting that not all of the stimulus spending was at the direction of President Biden and Democrats. The first two rounds were approved during the Trump administration. And, economists were not united in warning about inflation.As for the economy being in recession? “Most economists still don’t think the United States meets the formal definition,” Mr. Casselman wrote in July, and he said that remained true as we head into October. But such calls are only made in retrospect. “Even if we are already in a recession, we might not know it — or, at least, might not have official confirmation of it — until next year,” Mr. Casselman said.What was said“Tax breaks for luxury electric cars.”This is true. The Inflation Reduction Act contains a tax credit for electric vehicles. Their final assembly must be completed in North America to be eligible for the credit, which, indeed, extends to several luxury automakers. The list includes Audi, BMW, Lincoln and Mercedes, but also non-luxury models like the Ford Escape and Nissan Leaf. What about Tesla? It made the list of 2022 models, but it has already reached a federal cap of the number of vehicles eligible for the credit, according to the Energy Department.What was said“Even a billion dollars to prisoners, including the Boston Bomber.”This is exaggerated. Dzhokhar Tsarnaev, who was convicted of helping carry out the 2013 Boston Marathon bombings, received a $1,400 Covid-19 stimulus rebate from the federal government in June 2021. The money was part of the American Rescue Plan Act, which President Biden signed into law after it passed the House on a mostly party-line vote, with Ms. Titus supporting it.But what the Republican attack ad failed to disclose was that Mr. Tsarnaev was required by a federal judge to return the money as part of restitution payments to his victims. Another glaring omission was the fact that inmates were previously eligible for Covid-19 relief payments when former President Donald J. Trump was in office, though the Internal Revenue Service and some Republicans had later tried to rescind the payments. A federal judge thwarted those efforts, ruling that inmates could keep the payments.Those nuances haven’t stopped Republicans from latching onto the issue of inmates receiving Covid-19 payments against Democrats in key races across the nation, including Senator Raphael Warnock of Georgia and Senator Mark Kelly of Arizona. More

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      in Elections

      Finally, Some Good News on Inflation

      by

      This is not the end of inflation. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.On Wednesday, the Bureau of Labor Statistics reported something we haven’t seen since the depths of the pandemic recession: a month without inflation. That is, the average price of the goods and services consumers buy was no higher (actually slightly lower) in July than it was in June.Before I get to what the latest inflation numbers mean, two notes on reactions to the report.First, there is absolutely no reason to question the numbers. There were many advance indications that this report, and probably the next few reports, would show a sharp drop in inflation. In fact, I wrote about that last week. It’s not just falling gasoline prices; business surveys point to declining inflation and supply chain problems are easing. Zero was a somewhat lower number than most observers expected, but not wildly so.Second, the enraged reaction of Republicans to the report came as something of a surprise, at least to me — not that it happened, but the form their outrage took. I expected them to accuse the Biden administration of cooking the books. Instead, most of the flailing seemed to involve a failure to understand the difference between monthly and annual numbers.When President Biden declared, accurately, that we had zero inflation in July, many on the right accused him of lying, because prices in July 2022 were 8.5 percent higher than they were in July 2021. Do they really not understand the difference? To be fair, sloppy business reporting may have contributed to their confusion — I saw many headlines to the effect that “inflation was 8.5 percent in July.” But the more fundamental issue, surely, is that it’s difficult to get people to understand something when their sloganeering depends on their not understanding it.OK, but what about the substantive implications of the Big Zero?Unfortunately, one month of zero inflation doesn’t mean that the inflation problem is solved. Economists have long known that you get a much better read on underlying inflation if you strip out highly volatile prices — normally food and energy, but there are a variety of measures of core inflation, and all of them are still unacceptably high. That’s a clear indication that the economy is running too hot. The Federal Reserve has been raising interest rates to cool things down, and nothing in Wednesday’s report should or will induce the Fed to change course.The Fed might, however, take some comfort from a different report, released Monday: the New York Fed’s monthly Survey of Consumer Expectations, which showed “substantial declines in short-, medium- and longer-term inflation expectations.”Ever since prices took off last year, Fed officials have been concerned that inflation might become entrenched. What they mean is that businesses and consumers might come to believe that large price increases are the new normal, making inflation self-perpetuating, and that getting inflation back down would require putting the economy into a severe, extended slump. That’s what most economists think happened in the 1970s, and it’s not an experience anyone wants to repeat.The good news is that there doesn’t seem to be any entrenching going on. Public expectations of future inflation are falling, not rising; financial markets also seem to anticipate much lower inflation than we’ve seen over the past year.Despite this good news, the Fed will surely keep raising rates until it sees clear evidence that underlying inflation is coming down. But it has some breathing room to be less aggressive than it might otherwise have been, waiting to see how the economic situation develops.Overall, falling inflation probably won’t have much effect on economic policy. It might, however, have big political implications.The truth, although Republicans go feral when you point it out, is that Joe Biden has presided over a huge jobs boom. Yet he has gotten no credit for that boom, possibly in part because many Americans don’t know about it, but largely because voters are focused on inflation — especially the fact that prices have risen faster than wages, reducing families’ purchasing power.Now at least that part of the story has gone into reverse. Wages are still rising fast, which is actually one reason to believe that underlying inflation remains high. But for now, at least, inflation has slowed, so workers will be seeing significant real wage gains. Indeed, average real wages rose half a percentage point in July alone.Hence G.O.P. outrage over accurate reporting on July’s inflation numbers. Republicans had been counting on high inflation, and high gas prices in particular, to deliver big gains for their party in the midterm elections. Suddenly, however, the economic facts have a liberal bias: Gas prices are plunging, inflation is down, and real wages are up.Will these facts make a difference in November? I have no idea. But the current hysteria on the right shows that Republicans are worried that they might.The Times is committed to publishing a diversity of letters to the editor. We’d like to hear what you think about this or any of our articles. Here are some tips. And here’s our email: letters@nytimes.com.Follow The New York Times Opinion section on Facebook, Twitter (@NYTopinion) and Instagram. More