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Republicans Say Spending Is Fueling Inflation. The Fed Chair Disagrees.

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Republicans Say Spending Is Fueling Inflation. The Fed Chair Disagrees.

WASHINGTON — The chair of the Federal Reserve, Jerome H. Powell, has repeatedly undercut a central declare Republicans make as they search sharp cuts in federal spending: Authorities spending is driving the nation’s still-hot inflation fee.

Republican lawmakers say spending packages signed into regulation by President Biden are pumping an excessive amount of cash into the economic system and fueling an annual inflation fee that was 6 p.c in February — a decline from final 12 months’s highs, however nonetheless nicely above historic norms. Mr. Powell disputed these claims in congressional testimony earlier this month and in a information convention on Wednesday, after the Fed introduced it might as soon as once more elevate rates of interest in an effort to deliver inflation again towards regular ranges.

Requested whether or not federal tax and spending insurance policies have been contributing to cost progress, Mr. Powell pointed to a decline in federal spending from the peak of the Covid-19 pandemic.

“It’s important to have a look at the fiscal impulse from spending,” Mr. Powell stated on Wednesday, referring to a measure of how a lot tax and spending insurance policies are including or subtracting to financial progress. “Fiscal impulse is definitely not what’s driving inflation proper now. It was at first maybe, however that’s not the story proper now.”

As an alternative, Mr. Powell — together with Mr. Biden and his advisers — says speedy value progress is primarily being pushed by components like snarled provide chains, an oil shock following Russia’s invasion of Ukraine and a shift amongst American customers from spending cash on companies like journey and eating out to items like furnishings.

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Mr. Powell has additionally stated the low unemployment fee was enjoying a task: “Some a part of the excessive inflation that we’re experiencing could be very probably associated to an especially tight labor market,” he instructed a Home committee earlier this month.

However the Fed chair’s place has not swayed congressional Republicans, who proceed to press Mr. Biden to just accept sharp spending reductions in trade for elevating the authorized restrict on how a lot the federal authorities can borrow.

“During the last two years, this administration’s reckless spending and failed financial insurance policies have resulted in continued document inflation, hovering rates of interest and an economic system in a recessionary tailspin,” Consultant Jodey C. Arrington, Republican of Texas and the chairman of the Funds Committee, stated at a listening to on Thursday.

Republicans have attacked Mr. Biden over inflation since he took workplace. They denounced the $1.9 trillion financial assist bundle he signed into regulation early in 2021 and warned it might stoke damaging inflation. Mr. Biden’s advisers largely dismissed these warnings. So did Mr. Powell and Fed officers, who have been holding rates of interest close to zero and taking different steps on the time to stoke a sooner restoration from the pandemic recession.

Economists usually agree that these stimulus efforts — carried out by the Fed, by Mr. Biden and in trillions of {dollars} of pandemic spending signed by Mr. Trump in 2020 — helped push the inflation fee to its highest stage in 40 years final 12 months. However researchers disagree on how massive that impact was, and over learn how to divide the blame between federal authorities stimulus and Fed stimulus.

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How Occasions reporters cowl politics. We depend on our journalists to be impartial observers. So whereas Occasions workers members could vote, they don’t seem to be allowed to endorse or marketing campaign for candidates or political causes. This contains taking part in marches or rallies in help of a motion or giving cash to, or elevating cash for, any political candidate or election trigger.

One latest mannequin, from researchers on the Federal Reserve Financial institution of New York, the College of Maryland and Harvard College, estimates that a couple of third of the inflation from December 2019 by way of June 2022 was brought on by fiscal stimulus measures.

A lot of that stimulus has already made its method by way of the economic system. Spending on pandemic assist to folks, companies and state and native governments fell sharply over the past 12 months, as emergency packages signed into regulation by Mr. Biden and former President Donald J. Trump expired. The federal price range deficit fell to about $1.4 trillion within the 2022 fiscal 12 months from about $2.8 trillion in 2021.

The Hutchins Heart on the Brookings Establishment in Washington estimates that within the first quarter of 2021, when Mr. Biden’s financial assist invoice delivered direct funds, enhanced unemployment checks and different advantages to hundreds of thousands of People, authorities fiscal coverage added 8 share factors to financial progress. On the finish of final 12 months, the middle estimates, declining authorities spending was truly lowering financial progress by 1 share level.

Nonetheless, even Biden administration officers say some results of Mr. Biden’s — and Mr. Trump’s — stimulus payments may nonetheless be contributing to increased costs. That’s as a result of People didn’t instantly spend all the cash they received from the federal government in 2020 and 2021. They saved a few of it, and now, some customers are drawing on these financial savings to purchase issues.

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Elevated client spending from financial savings could possibly be pushing the price of items and companies increased, White Home economists conceded this week of their annual “Financial Report of the President,” which incorporates summaries of the previous 12 months’s developments within the economic system.

“If the drawdown of extra financial savings, along with present revenue, boosted mixture demand, it may have contributed to excessive inflation in 2021 and 2022,” the report says.

Some liberal economists contend client demand is at present enjoying little if any function in value progress — inserting the blame on provide challenges or on corporations profiting from their market energy and the financial second to extract increased costs from customers.

Excessive costs “will not be being pushed by extra demand, however are literally being pushed by issues like a provide chain disaster or struggle in Ukraine or company profiteering,” stated Rakeen Mabud, chief economist for the Groundwork Collaborative, a liberal coverage group in Washington.

Different economists, although, say Mr. Biden and Congress may assist the Fed’s inflation-fighting efforts by doing much more to cut back client demand and funky progress, both by elevating taxes or lowering spending.

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Mr. Biden proposed a price range this month that will lower projected price range deficits by $3 trillion over the subsequent decade, largely by elevating taxes on excessive earners and firms. Republicans refuse to lift taxes however are pushing for fast cuts in authorities spending on well being care, antipoverty measures and extra, although they haven’t launched a proper price range proposal but. The Republican-controlled Home voted this 12 months to repeal some tax will increase Mr. Biden signed into regulation final 12 months, a transfer that might add modestly to inflation.

Republican lawmakers have pushed Mr. Powell on whether or not he would welcome extra congressional efforts to cut back the deficit and assist deliver inflation down. Mr. Powell rebuffed them.

“We take fiscal coverage because it involves our entrance door, stick it in our mannequin together with 1,000,000 different issues,” he stated on Wednesday. “And we’ve got accountability for value stability. The Federal Reserve has the accountability for that, and nothing goes to alter that.”

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Dear USPS: This California town wants its post office back

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Dear USPS: This California town wants its post office back

On the outskirts of this coastal village — just past the road sign telling visitors they are “Entering a Socially Acknowledged Nature-Loving Town” — a big wooden placard displays a set of hand-painted numbers. They are changed each morning.

“Days Without a Bolinas Post Office,” the sign reads.

On June 1, that number hit 456.

That’s how long it has been since the U.S. Postal Service was booted from its office in downtown Bolinas amid a fight with its longtime landlord.

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In this artsy little town in west Marin County — a haven for poets and painters, writers and actors — the loss hit hard. The 1,500 citizens of ZIP Code 94924 have fought to get their post office back with their most cherished tool: creativity.

They have picketed with placards reading, “Real Mail Not Email!” They have marched in local parades dressed as letter carriers. They have composed songs and written poems and sent thousands of letters, in hand-painted envelopes, to USPS officials.

They even drafted their own plan for a temporary post office, offered to fund it, and sent it to Congress.

“It’s a very Bolinas approach, breaking through bureaucracy through art and culture and pleas,” said John Borg, who is helping lead the citizens campaign. “This has taken way longer than it should.”

The approach is quirky, but the loss is serious.

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A sign at the entrance of Bolinas counts the days the small coastal town has been without its post office.

(Genaro Molina / Los Angeles Times)

Most people in this aging rural community abutting the Point Reyes National Seashore do not get home delivery. They relied upon daily trips to the post office for parcels, pension checks and mail-order prescriptions, not to mention the chance to catch up on the small-town scuttlebutt.

Now, they must drive at least 40 minutes round-trip, through the forest on Highway 1, to a flood-prone post office at a campground in the even smaller town of Olema.

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Enzo Resta, a longtime resident and founder of the new Bolinas Film Festival, compared reaction to the loss of the post office with the so-called “hype cycle” around new technologies.

“There was the crash, where there was a lot of hope and indicators we would get it back — the peak of inflated expectations,” he said. “When it got pushed a little further, we kind of went into the valley of despair, and we’re just trying to crawl back out.”

The Bolinas post office shut down on March 3, 2023. It had occupied half of an unadorned single-story wooden building on Brighton Avenue — most recently shared with a liquor store — for six decades.

The USPS already was a tenant when Gregg Welsh, of Ventura County, acquired the building about 50 years ago. His family trust currently owns it.

The relationship between landlord and tenant soured long ago.

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A woman in a black wetsuit carries her surfboard down an empty street.

Most people in Bolinas do not get home delivery and relied upon daily trips to the post office for their parcels, pension checks and mail-order prescriptions.

(Genaro Molina / Los Angeles Times)

According to a statement provided by Welsh through his attorney, Patrick Morris, the USPS for years violated its lease, which required it to maintain and repair the flooring at its own expense.

The postal service, the statement reads, discovered asbestos in the floor tiles in 1998, but essentially kept it hidden from the landlord for more than two decades and did not post warning signs for the public or employees.

When Welsh visited the Bolinas post office in late 2020, the statement reads, he saw worn and broken tiles and exposed, deteriorating subfloor materials.
The landlord and the postal service tussled over who should pay for repairs and asbestos abatement.

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The USPS lease, according to the statement, ended in January 2022, with the parties still arguing over the floor. The postal service continued to occupy the building, sans lease, as a “tenant at sufferance.”

In a February 2023 email to USPS officials, which Morris provided to The Times, Morris said his client had not yet evicted the post office, in part because he had not wanted to deprive Bolinas residents of postal facilities before it could find a new location. But at that point, Welsh had had enough. He demanded the post office vacate the building within a month.

Kristina Uppal, a Bay Area-based spokeswoman for the USPS, did not respond to questions from The Times about accusations made by the landlord or about the alleged presence of asbestos in the building. She said the USPS was “forced from the old facility due to the unexpected termination of a lease,” but that there are no plans to permanently close the Bolinas post office.

“We are just as eager to resume retail operations in Bolinas as the community and provide enhanced accessibility such as expanding street delivery to alleviate any inconvenience,” Uppal wrote.

A colorful envelope with a big red heart asks the U.S. Postal Service to save the Bolinas post office.

Bolinas residents sent more than 2,500 “art” letters with personalized appeals asking U.S. Postal Service officials to resurrect mail service in their town.

(John Borg)

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Residents want their post office back, but their trust in the USPS has frayed.

The dust-up in Bolinas comes as U.S. Postmaster Louis DeJoy, appointed when former President Trump was in the White House, is under fire for efforts to consolidate postal facilities. In a May letter, a bipartisan group of U.S. senators criticized his 10-year plan, Delivering for America, arguing that cost-cutting measures have degraded service and disproportionately affected rural communities.

Bolinas residents say they have had little direct communication from the USPS over the last 15 months. Bolinas, they note, had a post office since 1863, but townsfolk were given less than two weeks’ notice before it closed.

Their mail has been bounced around — rerouted first to Olema, then to nearby Stinson Beach because of flooding, then back to Olema. Sometimes, their letters were left in unsecured bins on outdoor tables.

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The relocation has been more than just an inconvenience for the town’s elderly residents, many of whom cannot drive. There is little public transit, and more than half the town’s residents are 65 or older.

People began reporting problems getting mail-order medication soon after the post office closed, according to the Marin County Board of Supervisors. They also have struggled to get lab results and healthcare coverage updates.

Borg, 62, is a type 1 diabetic who had his insulin delivered through the mail before the closure. Now, he said, package delivery is so iffy that he drives two hours round-trip to San Rafael each month to pick it up at a pharmacy.

An artist paints a white sign that will call out how many days Bolinas is without a post office.

Bolinas’ poets and painters have been integral to the town’s campaign for a post office. Here, an artist who goes by StuArt, creates the sign that will count the days Bolinas goes without service.

(John Borg)

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Borg runs a small business, making stainless steel drinkware, and has had two five-figure checks for his company lost in the mail.

He said residents of the unincorporated town — which has no mayor or city attorney advocating on their behalf — had to band together to make their voices heard.

Appealing to the outside world is a tall order for a place so famously reclusive that, for years, a vigilante band called the Bolinas Border Patrol stole road signs on Highway 1 directing travelers into town. Once, when the California Department of Transportation tried painting BOLINAS on the blacktop, sneaky citizens promptly blacked them out with tar.

“We’re a small village that kind of likes to keep to ourselves and deflect attention and not be super profile. But we’re in the process where the town is changing,” said Borg, noting that a growing share of Bolinas’ limited housing stock is being used as second homes for the wealthy and short-term vacation rentals.

“The one thing that holds this place together is the post office.”

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There has been no viable commercial real estate in tiny Bolinas for the post office to move into permanently. And a 1971 water meter moratorium has effectively prohibited development for the last 53 years. The moratorium, which has been challenged and upheld in court, was put into place because Bolinas has a limited water supply, mostly coming from the Arroyo Hondo Creek in the Point Reyes National Seashore.

Last spring, residents drafted a detailed proposal for a temporary facility — a mobile office trailer on a parking lot next to the fire station — and offered to raise $50,000 for its installation.

A hand-painted sign tacked to a picket fence calls for saving the Bolinas post office.

Bolinas residents note they were given just two weeks’ notice that their post office — a fixture in town since 1863 — was closing.

(Genaro Molina / Los Angeles Times)

They sent the plan to a supportive Rep. Jared Huffman (D-San Rafael), who shipped it to DeJoy. A spokesperson for Huffman said his office has been in frequent contact with the USPS and shares the community’s frustration over the slow process.

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Uppal, the USPS spokeswoman, said the agency has “reviewed proposals” and “will select a site that best meets our operational needs and can provide continued service to the community long term.”

“I can confirm there is a potential option that is under review now,” she wrote. She did not provide details.

In his written response to questions from The Times, Welsh, through his attorney, said there has been discussion with USPS about moving back into its former building. No further details were provided.

For now, Bolinas residents continue to haul up to Olema — and to lionize the simple pleasure of picking up their mail locally. Or, as one local poet put it in an ode penned for a “Save the Post Office” rally:

I have gossip to send to Tomales,
regrets to send to Limantour Beach.

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But it’s Bolinas — always Bolinas — I dream of finding
in the return address of a letter sent to me.

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How the power of the Minions and Gen Z propelled the 'Despicable Me' franchise

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How the power of the Minions and Gen Z propelled the 'Despicable Me' franchise

It was a spectacle (and for some, a menace) when droves of suit-clad young men showed up to theaters for 2022’s “Minions: The Rise of Gru.”

Against all odds, the #Gentleminions social media phenomenon showed that the Minions — up until that point, a staple of Facebook memes shared by very-online moms — could evolve as a cultural touchstone for that coveted demographic, Gen Z. The Minions had come full circle, staying relevant to the children who first met the yellow mischief-makers in 2010’s “Despicable Me” all the way through their young adult years.

It’s the kind of organic marketing that studios and theater owners can only dream of. Universal Pictures and Illumination Entertainment are counting on that multigenerational popularity to propel the franchise’s latest installment, “Despicable Me 4,” which comes out in theaters Wednesday.

So far, the signs are good. The movie is tracking to garner at least $100 million in ticket sales for the U.S. and Canada for the five-day Fourth of July extended weekend.

The last “Minions” movie broke Fourth of July domestic box office records and went on to make $940 million worldwide. This time around, families are already primed to hit the theaters with the recent success of Pixar’s “Inside Out 2,” which has now grossed more than $1 billion in global ticket sales.

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“I’ve been 25 to 28 years in the business. I can’t remember something that created that much excitement for the audiences,” Francisco Schlotterbeck, chief executive of theater chain Maya Cinemas, said of the overall Minions craze. “The other thing I can compare it to is ‘Toy Story.’”]

Theaters have been eager for good news. Exhibitors earlier this year were walloped by a dearth of blockbusters, partly due to Hollywood’s long summer of strikes in 2023, which delayed multiple high-profile titles. Though a string of recent hits has brought relief, with “Bad Boys: Ride or Die,” “Inside Out 2” and “A Quiet Place: Day One,” domestic revenue remains down 19% from last year, according to Comscore.

“Despicable Me 4” is expected to continue the momentum. Maya Cinemas’ ticket pre-sale numbers for the sequel are trending up, and Schlotterbeck is expecting sales that are “triple of a normal week.” Family-friendly movies, like the “Despicable Me” franchise, do especially well with Latino audiences, he said, which his chain is geared toward.

After a tough first half of the year with limited films to show, he’s expecting better sales for the months ahead, especially with family films such as “Moana 2,” “Sonic the Hedgehog 3” and “Wicked” coming down the pipeline.

“All these big family titles will help,” said Schlotterbeck, whose chain has five locations in California and one in Las Vegas. “It’s pretty important to have these kind of very well-known franchises.”

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Theaters are preparing for all kinds of Minions fans to flood the gates this weekend. Dine-in theater chain Cinépolis Luxury Cinemas USA plans to raffle off themed baby carriers that hold a popcorn bucket to tie in with supervillain Gru’s new role as a dad, said Luis Olloqui, company chief executive.

“Having the previous ‘Minions’ movie was really good, in terms of performance,” he said. “We saw that excitement among the people going to the movie dressing up and making it more of an event. This time, we are expecting kind of the same.”

The cross-generational popularity of the Minions stems from their cute appearances and humorous antics. But part of the appeal is also that they’re a bit of a blank slate, said Carrie Wilson-Brown, an instructor at the University of Illinois’ College of Media. In the same way that Sanrio icon Hello Kitty has advertised both motor oil and diamond necklaces and regularly wears all teams’ baseball caps, the Minions have become a canvas on which you can project whatever you want.

Minions are on all manner of merchandise these days. There are Minion Chia pets, Minion mugs, Minion sandwich makers and Minion toasters. For Los Angeles residents, there’s even the giant Minion that peeks over the edge of a Universal Studios parking structure to spy on the 101 Freeway (which has spawned memes of its own).

“You can infer anything out of it,” Wilson-Brown said. “They can even travel culturally, not from generation to generation, but from country to country because they don’t speak a particular language.”

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It’s how the Minions joined the front lines of Facebook mom memes, which typically pair a picture of a Minion with unrelated sayings such as “I didn’t fall, the floor just needed a hug” or “I’ve been hiding from exercise. I’m in the fitness protection program.”

But the #Gentleminions craze was a turning point, when Gen Z consumers tried to take back the Minions of their childhood, Wilson-Brown said.

“You note your popularity specifically when you get internalized into meme culture,” she said. “In terms of ‘Despicable Me’ and the Minions specifically, all of a sudden, they kind of transcended out of the film into internet culture.”

Companies face a delicate dance while trying to court Gen Z audiences, who have expendable income they’re willing to plunk down on pop culture merchandise. Try too hard to appeal to them, and it seems inauthentic; try too little, and it looks like the product isn’t actually meant for them.

“Film companies and traditional media are desperately trying to constantly see what Gen Z-ers are producing in a cultural milieu, but in many respects they’re trailing behind them,” Wilson-Brown said.

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Will the #Gentleminions return for a second ride?

“I’d be hard-pressed to believe they’re going to be re-creating that same thing over and over again,” Wilson-Brown said. “Because that was so organic, it’s really hard to then predict … what they are going to end up doing to up the ante, culturally, for this particular film.”

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Microsoft to pay $14.4-million settlement over alleged parental, disability leave discrimination

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Microsoft to pay $14.4-million settlement over alleged parental, disability leave discrimination

Microsoft will pay a $14.4-million settlement after California’s Civil Rights Department accused the company of retaliation and discrimination against workers who take parental or disability leave, or leave to take care of a family member.

Workers at Microsoft in California experience disadvantages in pay and promotion opportunities when they take these types of protected leave, a multiyear investigation by the Civil Rights Department found.

Employees who took protected leave would receive lower bonuses and unfavorable performance reviews, the department said in its complaint, filed July 1 in Santa Clara County. When Microsoft managers awarded annual bonuses, stock awards, or merit increases they did not consider time on protected leave as time where employees were actively working — although other forms of leave were not discounted, according to the complaint.

Women and people with disabilities were disproportionately affected, the department alleged.

Some Microsoft managers also allegedly commented negatively about employees who took leave, and workers have reported concerns with retaliation after requesting or taking protected leave.

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“Microsoft’s challenged actions are ongoing and will continue to harm,” the complaint states.

Microsoft spokesperson Sarah Naciri said the company disagreed with the allegations.

“Microsoft is committed to an environment that empowers our employees to take leave when needed and provides the flexibility and support necessary for them to thrive professionally and personally,” Naciri said in an emailed statement. “While we believe the agency’s allegations are inaccurate, we will continue to listen, learn, and support our employees.”

Although Microsoft is headquartered in Redmond, Wash., it maintains offices and employees in California, mostly concentrated in the Bay Area.

Nearly all the money from the agreement will go toward current and former employees eligible for direct relief. A worker is eligible if they worked for Microsoft in California in 2017 or later for at least three months and took a leave of absence protected under state or federal law.

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As part of the settlement, Microsoft agreed to hire an independent consultant to examine and make recommendations on the company’s personnel policies to ensure managers do not consider time on protected leave in determining annual rewards and promotions.

The company also agreed to train managers and human resources personnel about this kind of discrimination, and to ensure employees know how to raise complaints if they believe they were denied annual bonuses or other awards unfairly.

Additionally, the independent consultant will provide annual reports to the Civil Rights Department on how complaints of discrimination are received and processed.

Last month, California’s Civil Rights Department reached a $15-million settlement to resolve allegations of sexual harassment, discrimination and retaliation at Snap, the Santa Monica-based company that created the popular social media app Snapchat.

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