House Republicans’ plan to majorly slash federal spending over the next decade as a supposed “solution” to the national debt would likely cost millions of jobs and trigger a recession next year, a new report by Moody’s Analytics economists finds. With Republicans in charge of only one chamber of Congress, the party has turned to the debt limit as a vehicle for their policy priorities… Source Source / Read More: GOP’s Debt Limit Plan Would Cost 2.6 Million Jobs, Report Finds
Recession
Companies’ Price Hikes Fuel Inflation. Why Isn’t the Fed Talking About It?
Federal Reserve Chair Jerome Powell fielded questions for around 40 minutes on Wednesday following the central bank’s decision to impose another large interest rate hike, but not a single reporter asked about the extent to which record-high corporate profits are fueling inflation even as companies openly boast about their pricing power. Progressive economists have estimated that corporate profits are to blame for at least 40% of price increases during the recovery from the pandemic-induced downturn, a disproportionate contribution to the stubbornly high inflation that is eating away at workers’ wages. Some have put the number at over 50%. The notion…
Warren, Sanders Slam Federal Reserve’s “Disregard” for Working Families
A group of Democratic lawmakers led by Sen. Elizabeth Warren (D-Massachusetts) is pressuring the Federal Reserve to explain why it’s continuing to raise interest rates at such a rapid pace when economists across the political spectrum say that rate hikes will only hurt the working class with little upside for the economy at large. In a letter sent to Fed Chair Jerome Powell on Monday, 11 members of Congress lay out a wide swath of evidence from both Powell himself and from economists that American families will be in for “pain” in the coming months, as Powell has said, as…
Throwing People Out of Work Is No Way to “Fix” the Economy
From groceries to rent, prices are rising on just about everything these days — and those with already-stretched budgets are feeling the pinch. Bringing prices down must be a top priority for lawmakers, but Washington’s default tool for dealing with inflation — aggressive interest rate hikes — only makes life harder for these families. That’s because aggressive interest rate hikes work by increasing unemployment and slowing down wage growth, a “cure” far worse than the disease. Former Treasury Secretary Larry Summers is a longtime advocate of this cruel approach. Earlier this summer, Summers cheered the idea of throwing millions out…