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    Trump’s Pledge to Not Tax Overtime Could Become Federal Law

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    When President Trump first floated the idea of “no tax on overtime” at a campaign rally last year, he did not elaborate on how it would work. Could anyone who works more than 40 hours a week claim a tax break? Would overtime pay really be completely tax-free?The answer to both questions, as it turns out, is no.Under the sprawling domestic policy bill that Republicans pushed through the House and are preparing to steer through the Senate, the tax break would be limited. It would be available only to Americans who, under federal law, must be paid at a time-and-a-half rate for working any time exceeding 40 hours in a week. That’s a broad group that includes almost all Americans who are paid an hourly wage, but many salaried workers would not be eligible.And the tax relief would not be total. Americans would still owe payroll taxes, and potentially state income taxes, on their overtime pay. Federal income taxes would be eliminated on those wages, but only on the earnings attributable to the 50-percent bump in pay — only a third of the money made while working overtime.Even with those limitations, both critics and supporters of the idea believe the tax break could reshape the American labor market. The White House Council of Economic Advisers expects that the policy will motivate Americans to work more and help strengthen the economy.Skeptics think the change would primarily drive people to reclassify their earnings or even change jobs in order to file for overtime. They worry that if enough people sought jobs that offer overtime, wages in those positions could eventually fall.“Ultimately, it’s going to create unintended consequences that incentivize certain behaviors in the labor market and thus create winners and losers from that,” said Emmet Bowling, a labor policy analyst at the American Action Forum, a conservative think tank. “Hourly jobs might become more desirable because of this tax deduction.”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? Log in.Want all of The Times? Subscribe. More

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      Trump’s Tariffs Expected to Drag Down the Global Economy

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      Economic growth will slow this year and next as the trade war hampers development in the United States and around the world, the Organization for Economic Cooperation and Development said.President Trump’s trade war is expected to slow growth in the world’s leading economies, including the United States, this year and in the years to come, unless world leaders can resolve their differences over trade.The Organization for Economic Cooperation and Development slashed its outlook for global output to 2.9 percent this year, from 3.3 percent in 2024, the organization said in its economic report released on Tuesday.Economic growth in the United States is expected to be particularly weak, the organization said, rising 1.6 percent this year, a drop from the 2.2 percent projected in March, and 1.5 percent in 2026, down from its previous estimate of 1.6 percent. The U.S. economy grew 2.8 percent in 2024.“Through to the end of 2024, the global economy showed real resilience,” said Mathias Cormann, the organization’s secretary general. “But the global economic environment has become significantly more challenging since.”In the first three months of the year, economic growth in the countries monitored by the organization, which is based in Paris, “dropped abruptly” to 0.1 percent from the last three months of 2024, which is “the slowest rate of growth since the peak of the Covid-19 pandemic some five years ago,” Mr. Cormann said.Since taking office, Mr. Trump has imposed tariffs, then halted them for several weeks, then reinstated some, in the hopes of winning new trade deals with countries ranging from once-close allies like Canada, Mexico and the European Union, as well as longtime rivals like China.The lack of certainty coming from that on-again, off-again strategy, combined with frequent changes in how high the tariffs will eventually be, has roiled markets and disrupted the flow of goods and services around the world. From January to March, many companies rushed goods to the United States, hoping to avoid the higher tariffs, many of which are now set to take effect in July.Even if the Trump administration increases tariffs on most of America’s trading partners by just 10 percent, it would shave off 1.6 percent of economic growth in the country over two years, the report said. Growth on a global scale would contract nearly a full percentage point in the same time span.Further pressure is coming from the need for leading economies, such as those in the European Union, to increase military spending while also investing in the transition to a green economy, the report said.The economies of the 20 countries using the common euro currency are projected to grow to 1 percent in 2025 and 1.2 percent in 2026, in line with the O.E.C.D. forecast from March. China’s economy is expected to see 4.7 percent growth this year, and 4.3 percent in 2026, down 0.1 percent from the organization’s spring projection.Economists in the organization urged countries to reach agreements on trade and to increase investment to revive economic growth.“Our key recommendation, to all governments, is to engage with each other to address issues in a global trading system cooperatively,” Mr. Cormann said. More

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      Stanley Fischer, Who Helped Defuse Financial Crises, Dies at 81

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      He was the No. 2 at the Federal Reserve and the I.M.F. during periods of economic turmoil, and he mentored future economic leaders, like Ben Bernanke.Stanley Fischer, an economist and central banker whose scholarship and genial, consensus-seeking style helped guide global economic policies and defuse financial crises for decades, died on Saturday at his home in Lexington, Mass. He was 81.The cause was complications of Alzheimer’s disease, his son Michael said. Mr. Fischer served as the head of Israel’s central bank from 2005 to 2013, as vice chairman of the Federal Reserve Board from 2014 to 2017 and as the No. 2 officer at the International Monetary Fund from 1994 to 2001, when that agency was struggling to contain financial panics in Mexico, Russia, Asia and Latin America.As a professor at M.I.T., he was a thesis adviser or mentor to an extraordinary range of future leaders, including Ben S. Bernanke, later chairman of the Fed; Mario Draghi, president of the European Central Bank; and Kazuo Ueda, governor of the Bank of Japan. His former students also included two people who chaired the U.S. Council of Economic Advisers, Christina D. Romer and N. Gregory Mankiw, as well as Lawrence H. Summers, who served as secretary of the Treasury and president of Harvard University.“He had a role in shaping a whole generation of economists and policymakers,” Mr. Bernanke said in a February 2024 interview for this obituary. That included spurring Mr. Bernanke’s initial interest in macroeconomics and monetary policy.In 1998, The Times described Mr. Fischer as “the closest thing the world economy has to a battlefield medic.” He helped negotiate a rescue package for Russia by cellphone while standing atop a sand dune on Martha’s Vineyard, where he was on vacation. 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? Log in.Want all of The Times? Subscribe. More

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      Trump Aides Insist That Tariffs Will Remain, Even After Court Ruling

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      One official said that the president is unlikely to delay his initial 90-day pause on some of his highest rates.President Trump’s top economic advisers stressed on Sunday that they would not be deterred by a recent court decision that declared many of the administration’s tariffs to be illegal, as they pointed out a variety of additional authorities that the White House could invoke as it looks to pressure China and others into negotiations.They also signaled that Mr. Trump had no plans to extend an original 90-day pause on some of his steepest tariff rates, raising the odds that those duties — the mere announcement of which had roiled markets — could take effect as planned in July.“Rest assured, tariffs are not going away,” Howard Lutnick, the commerce secretary, said during an appearance on “Fox News Sunday.”Asked about the future of the president’s so-called reciprocal tariffs, first announced and quickly suspended in April, Mr. Lutnick added, “I don’t see today that an extension is coming.”The president’s tariff strategy entered uncharted political and legal territory last week after a federal trade court ruled that Mr. Trump had misused an emergency economic powers law in trying to wage a global trade war.The decision would have put a quick halt to those duties, which form the centerpiece of the president’s strategy of pressuring other countries into trade talks. But an appeals court soon granted the government a brief administrative pause to sort out arguments in the case, which is expected to reach the Supreme Court.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? Log in.Want all of The Times? Subscribe. More

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      U.S. Oil Companies Are ‘Battening Down the Hatches’

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      The industry is bracing for the OPEC Plus oil cartel’s meeting on Saturday, which is widely expected to further increase oil production despite weak demand.U.S. oil companies are pulling back as lower commodity prices take a toll.After two months of crude oil prices hovering around $60 a barrel, companies are shutting down drilling rigs and laying off workers as they pare spending. It now appears very likely that U.S. oil production will not grow much this year, if at all.There are two main reasons for low oil prices. President Trump’s trade war is likely to slow the global economy, hurting demand for fuel. And OPEC Plus, an oil cartel led by Saudi Arabia, is increasing production of oil as demand is softening.On Saturday, eight members of the cartel are widely expected to announce plans to bring even more oil to market this summer, which could send prices lower still.American oil companies are not waiting to find out.While the oil giants Exxon Mobil and Chevron are maintaining their spending plans, smaller companies are pulling back. Those focused on drilling for oil now plan to spend around 3.5 percent less this year than previously planned, according to a BloombergNEF analysis of a dozen publicly traded companies. All things equal, more drilling tends to drive oil prices down and less drilling generally props them up.“We can’t run our program on hope,” Tom Jorden, chief executive of the oil and gas producer Coterra Energy, told analysts during an earnings call this month. “So we are battening down the hatches, expecting this to last for a while.”The Houston-based company said it would drill less in the Permian Basin of Texas and New Mexico, the top U.S. oil field, and more in the Northeast, which is rich in natural gas. Prices for that fuel, used in power plants and for heating, have been much more resilient.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? Log in.Want all of The Times? Subscribe. More

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      Teachers Saved My Life. Why Do We Treat Them So Poorly?

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      I have attended commencements of all kinds throughout my career, and I can tell you that some of the best are in prisons.Over and over, I have spoken at these commencements with incarcerated men and women who acknowledge the awful choices or stupid mistakes they made, the strangers or loved ones they hurt, yet emerge from prison renewed through higher education. While 95 percent of the people incarcerated will come home one day, they often return to the same cycles that led them to prison in the first place. Through college coursework, they are able to reflect on their past, develop a clearer vision for their future and gain the skills to contribute to their families and communities.One student told me that pursuing college while incarcerated was the first time he had moral and academic credibility with his family. The potential for higher education in prison to change lives is the reason that I worked to expand these programs when I was the U.S. secretary of education and president of a national education civil rights organization, and do so now as chancellor of the State University of New York.I believe so deeply in the transformative power of education because teachers saved my life.When I was 8 years old, in October of 1983, my mother died suddenly from a heart attack. It was indescribably devastating. I then lived alone with my father, who was struggling with Alzheimer’s until he died when I was 12. During those years with my father, no one outside our home knew he was sick, and I didn’t know why he acted the way he did.Some nights he would talk to me; some nights he wouldn’t say a word. Other nights he would be sad or angry, or even violent. Home was scary and unstable, but I was blessed to have New York City public schoolteachers who made school a place that was safe, nurturing, academically rigorous and engaging.If not for Allan Osterweil, my teacher in fourth, fifth and sixth grade at P.S. 276 in Canarsie, Brooklyn, I would be in prison or dead. Amid the darkness of my home life, Mr. Osterweil gave me a sense of hope and purpose. In his classroom, we read The New York Times every day. We learned the capital and leader of every country in the world. We did productions of Shakespeare and Lewis Carroll.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? Log in.Want all of The Times? Subscribe. More

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      Retirees Are Filing for Social Security Earlier. Why?

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      An additional 276,000 people filed for Social Security benefits so far this fiscal year, up 13% from a year ago. Anxiety appears to be a driver.The morning after his 67th birthday, Marty McGowan filed for Social Security. That wasn’t his original plan. He had intended to wait until he was 70 to claim benefits, in exchange for a heftier payment that would have yielded an extra $800 a month.But like other retirees in recent months, he was watching the Trump administration’s shake-up at the Social Security Administration during a time when the broader economic outlook appeared increasingly uncertain. Concerns about the economy and access to benefits nudged him to file earlier than he had anticipated, even if it might cost him over the long run.He wasn’t the only one: An additional 276,000 retirees claimed benefits on their earnings record this fiscal year through April, according to the Urban Institute, a research group, a 13 percent jump from the same period a year ago. Officials inside the Social Security Administration called the rise “dramatic,” and though there were some other reasons for the surge, program experts say anxiety appeared to play a meaningful role.“It is worrisome because for most people, claiming early is not a good decision,” said Jack Smalligan, a senior policy fellow at the Urban Institute. “They’re nervous about the threats to the Social Security Administration and their benefits, while simultaneously looking at their 401(k), if they have one, and worrying about that.”The Trump administration’s crusade to diminish the federal bureaucracy did not spare Social Security, which rattled insiders at the agency and Americans close to or in retirement. Many of them feared that job cuts and other policy changes could threaten their access to benefits, causing them to jam phone lines and overwhelm offices. Elon Musk, the tech billionaire whose Department of Government Efficiency drove many of the changes, continued to spread false claims about widespread fraud at the agency, which only added to the confusion.That situation, coupled with wider economic uncertainty, seemed to influence some retirees’ real-world financial decision-making. Agency officials acknowledged this during their recent operational meetings, along with other strains on the system.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? Log in.Want all of The Times? Subscribe. More

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      What’s the Cost to Society of Pollution? Trump Says Zero.

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      The Trump administration has directed agencies to stop estimating the economic impact of climate change when developing policies and regulations.The White House has ordered federal agencies to stop considering the economic damage caused by climate change when writing regulations, except in cases where it is “plainly required” by law.The directive effectively shelves a powerful tool that has been used for more than two decades by the federal government to weigh the costs and benefits of a particular policy or regulation.The Biden administration had used the tool to strengthen limits on greenhouse gas emissions from cars, power plants, factories and oil refineries.Known as the “social cost of carbon,” the metric reflects the estimated damage from global warming, including wildfires, floods and droughts. It affixes a cost to the economy from one ton of carbon dioxide pollution, the main greenhouse gas that is heating the planet.When considering a regulation or policy to limit carbon pollution, policymakers have weighed the cost to an industry of meeting that requirement against the economic impact of that pollution on society.During the Obama administration, White House economists calculated the social cost of carbon at $42 a ton. The first Trump administration lowered it to less than $5 a ton. Under the Biden administration, the cost was adjusted for inflation and jumped to $190 per ton.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? Log in.Want all of The Times? Subscribe. More

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      ‘Don’t Need a Deal.’ Top Trump Economic Adviser Is All in on His China Hardball

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      In a wide-ranging interview, Stephen Miran, the president of the chair of President Trump’s Council of Economic Advisers, said “volatility doesn’t necessarily mean anything greater for the long term.”The first 100 days of the second Trump administration have been a whirlwind. And Stephen Miran, the chair of President Trump’s Council of Economic Advisers, has been at the center of what he calls “the volatility.” Mr. Trump has raised import taxes to levels not seen since the 1930s. And trade talks to roll them back — or not — are in flux, leaving the trajectory of the U.S. economy, consumer prices and global trade in limbo.Miran, a Ph.D. economist trained at Harvard — who is renown for floating the idea of a Mar-a-Lago Accord to “restructure the global trading system” — has been put in the position of explaining the president’s thinking and ultimate goals.On Wednesday, just before the United States and Britain announced a framework for a trade agreement and ahead of trade talks this weekend between the administration and Chinese officials, Miran spoke with The Times’s Talmon Joseph Smith at his office next to the White House. And he stood by the president’s unconventional moves.The interview has been lightly edited for length and clarity.You’ve said in public remarks that you are not on the negotiating team, but as an economist, do you believe that this country’s economy can sustain what the Treasury secretary has called the “embargo” levels of current tariffs on China?Yeah, so look, the president has acted with historic scope and speed to put American workers on fairer ground vis-à-vis our trading partners. I don’t think anybody could possibly say that the policy adjustment was not historic or extraordinary. And as a result, there’s been volatility in financial markets. There can also be volatility in economic data, but I think it’s important to understand that volatility doesn’t necessarily mean anything greater for the long term.And so is it possible that economic activity gets substituted from one month to another? Yeah. Are firms waiting to find out the outcomes of the negotiations? Yeah. Are they waiting to find out that the tax bill is being passed and that we’re going to avoid the biggest tax hike in history next year because the president’s 2017 tax cuts are not going to expire? Yeah, they’re waiting for that, too.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? Log in.Want all of The Times? Subscribe. More