Search

The article reports on financial issues in the U.S., particularly the potential effects to Wall Street of the failure by Congress to enact a law raising the country's debt ceiling to allow it to pay its financial obligations. According to economist Tyler Cowen, the complacency of businesses and politicians could result in a failure that could have devastating effect to the economy and markets. Also cited is the warning issued by Federal Reserve (Fed) chairman Jerome Powell on the issue.

The article analyzes the consequences of the surge in U.S. deficits for investors and borrowers as the government tries to prevent recession and control inflation. Topics discussed are impact of rising yields on government debt on mortgage rates for home loans, potential of increased public spending to rekindle inflation, political cost to delegating economic management to the central bank, and link between rise in government debt service costs and interest rate hike.

Republican nominee Donald Trump and running mate JD Vance have proposed a series of tax cuts that could cost up to $10.5 trillion over a decade, surpassing the budgets of all domestic federal agencies combined. The Trump campaign has not released detailed policy plans for these tax cuts, but they claim that wasteful spending will be cut and energy production will be increased to offset the cost. In comparison, Democrat Kamala Harris has proposed smaller tax cuts that would be offset by tax increases on corporations and wealthy individuals. The magnitude of Trump's tax promises makes it unlikely that they would all pass, even with a Congress controlled by Trump allies. The impact of Trump's proposals on economic growth is uncertain, as they primarily focus on individual tax cuts rather than business tax cuts. If Congress were to pass the tax cuts without increasing spending, major federal agencies would need to be eliminated. Harris and President Joe Biden have released a budget proposal to cut federal deficits by $3 trillion over a decade through tax increases on corporations and wealthy individuals, but these plans have faced opposition from business lobbies. The outcome of the tax agenda will depend on the balance of power in Congress, and taxes will be a top priority regardless of the election outcome. Trump aims to extend his signature tax law, which would cost $4.6 trillion over ten years, and has suggested additional tax ideas such as excluding Social Security payments from taxes, exempting taxes on tipped wages, and increasing the child tax credit. Trump has offered few options to raise [Extracted from the article]

Six swing-district House Democrats, along with Republicans, voted to condemn Vice President Kamala Harris for the administration's handling of illegal migration. The resolution, backed by Republicans, labels Harris as Joe Biden's "border czar" and criticizes her for failing to secure the border. While Harris initially had responsibility for addressing the root causes of migration, the border situation worsened and a legislative solution could not be reached. It is important to note that other officials, such as Homeland Security Secretary Alejandro Mayorkas, also bear responsibility for the situation. [Extracted from the article]

Senate Majority Leader Chuck Schumer and House Democratic leader Hakeem Jeffries have endorsed Vice President Kamala Harris for president, following President Joe Biden's decision to end his reelection campaign. This endorsement signifies the Democratic Party's unity behind Harris after weeks of internal disagreements. Harris has quickly cleared the field of other potential contenders and will officially launch her campaign with a rally in Wisconsin. She has received a record-breaking $100 million in donations on her first day as a candidate and has secured the support of a majority of delegates for the party's nominating convention. [Extracted from the article]

Senate Majority Leader Chuck Schumer and House Democratic leader Hakeem Jeffries are set to endorse Vice President Kamala Harris for president, according to a source familiar with the announcement. This endorsement comes after President Joe Biden ended his reelection campaign, leading to the party's consolidation behind Harris. Harris has already cleared the field of other potential contenders and will launch her campaign with a rally in Wisconsin. She has received a record-breaking $100 million in donations on her first day as a candidate and has the support of a majority of delegates to the party's nominating convention. [Extracted from the article]

Former House speaker Nancy Pelosi has endorsed Kamala Harris for president, joining a growing number of Democrats supporting her bid. Pelosi stated that defeating Donald Trump and electing Harris as the next President of the United States is crucial. Democratic leaders Hakeem Jeffries and Chuck Schumer, who have been less vocal in pushing for Biden's removal from the ballot, plan to meet with Harris soon and are expected to endorse her. Pelosi's endorsement indicates that Harris is on track to secure the Democratic nomination ahead of the Democratic National Convention in August. [Extracted from the article]

Vice President Kamala Harris is facing the challenge of securing the Democratic presidential nomination and rallying support from her former congressional colleagues. Unlike Joe Biden, Harris has limited political alliances and relationships, having only served in the Senate briefly before running for president. However, she has wasted no time in reaching out to Hill Democrats to shore up support. Democrats are aware of Harris' strengths and the potential problems her nomination could create for the party. Republicans are preparing to present her as a villain, but Harris has a base of support among fellow Californians and members of the Congressional Black Caucus. [Extracted from the article]

Jon Tester, a Senate Democrat from Montana, has joined other Democrats in urging Joe Biden to withdraw from the presidential race due to concerns that he will not be able to defeat Donald Trump in November. Tester, who is considered one of the most vulnerable Senate Democrats, stated that while he has worked with Biden in the past, he believes Biden should not seek reelection. Other Senate Democrats in close reelection fights are also expected to join Tester in calling for Biden to drop out. Trump, who has endorsed Tester's opponent, easily won Montana in both the 2016 and 2020 elections. [Extracted from the article]

California Representative Adam Schiff, a front-runner in the state's US Senate race, has called for Joe Biden to drop out of the presidential contest, reigniting Democratic infighting. Schiff, who was one of the most prominent critics of former President Trump, is the first Democratic lawmaker to defect from Biden since the attempted assassination of Republican candidate Donald Trump. A recent poll found that 65% of Democrats want Biden to step aside. Other House Democrats and Senator Peter Welch of Vermont have also expressed dissatisfaction with Biden's candidacy. [Extracted from the article]

Senate Majority Leader Chuck Schumer has called for New Jersey Democrat Bob Menendez to resign after he was convicted on corruption charges. Menendez was found guilty on 16 criminal counts related to allegations that he sold his influence to protect businessmen and promote Egypt's interests. Menendez's wife, Nadine, was also charged and will face a separate trial. New Jersey Governor Phil Murphy and other Democratic politicians have also called for Menendez's resignation. If Menendez does step down, Murphy would appoint a replacement until the end of Menendez's term in January. [Extracted from the article]

President Joe Biden is facing pressure from congressional Democrats to step aside as the party's nominee, following concerns about his mental acuity and a disastrous debate performance. Top Biden aides are meeting with Senate Democrats to prevent further calls for him to bow out of the race. A new poll shows that registered voters are closely divided between Biden and Trump, but two-thirds of voters, including a majority of Biden supporters, believe he should step aside in favor of a new Democratic nominee. Vice President Kamala Harris leads Trump in a head-to-head match-up. Senate Majority Leader Chuck Schumer is open to replacing Biden as the nominee, but publicly supports him. [Extracted from the article]

President Joe Biden is facing opposition within his own party, with a Senate Democrat and a growing number of House lawmakers calling on him to step aside. Vermont Democrat Peter Welch became the first sitting senator to endorse replacing Biden, citing concerns about his mental acuity and the risk of another Donald Trump administration. While Biden's position remains unchanged and he intends to lead the party into the election, the calls for him to step aside highlight the precariousness of his political position. Senate Majority Leader Chuck Schumer has privately expressed concern and is open to replacing Biden as the nominee, but publicly reaffirmed his support. Former House Speaker Nancy Pelosi also urged Biden to make a quick decision about his candidacy. [Extracted from the article]

Senate Majority Leader Chuck Schumer is reportedly open to replacing Joe Biden as the Democratic nominee due to concerns about the president's mental acuity. Schumer has privately expressed his concerns to donors, although he has publicly supported Biden. The Biden campaign has not yet responded to the report, and Schumer's spokesperson declined to comment. [Extracted from the article]

Congressional Democrats are divided over whether to support Joe Biden's candidacy, with some calling on him to step aside due to concerns about his mental acuity. However, the White House and lawmakers are trying to shift the focus to Donald Trump's policy goals. Democrats are invoking "Project 2025," a suite of policy proposals drafted by the conservative Heritage Foundation for Trump, to alarm undecided voters and push them towards the president's camp. Despite concerns about Biden's ability to defeat Trump, there is no clear consensus among Democrats to force him to reconsider his candidacy. [Extracted from the article]

Congressional Democrats are divided over whether to support Joe Biden's candidacy, but they are attempting to shift the focus from Biden's mental acuity to Donald Trump's policy goals. Some Democrats are invoking "Project 2025," a set of policy proposals drafted by the conservative Heritage Foundation for Trump, to highlight the potential negative impact of his policies. Despite doubts about Biden's ability to defeat Trump, there is no clear consensus among Democrats for him to step aside. Some donors are expressing concerns about Biden's ability to beat Trump in the November election, but many still pledge to support him or the Democratic nominee. [Extracted from the article]

President Joe Biden is facing divisions within the Democratic Party regarding his candidacy following a poor debate performance. House Democrats held closed-door meetings to discuss Biden's ability to defeat Donald Trump in the upcoming election, but there is no clear consensus on whether he should step aside. Some lawmakers expressed support for Biden, while others called for him to withdraw. Additionally, concerns about Biden's ability to beat Trump are being raised by donors, with nearly 400 donors signing a letter calling for Biden to withdraw. Senate Democrats will also hold a meeting to discuss the issue. [Extracted from the article]

A key House Democrat on national security matters, Adam Smith, has publicly called on President Joe Biden to step aside as the party's nominee for the presidential race. Smith believes that Vice President Kamala Harris would be a stronger candidate and urged Biden and his inner circle to put personal feelings aside. Other Democratic representatives have privately expressed similar concerns about Biden's ability to win, and there is a desire for more outreach from Biden to reassure House Democrats. Senate Majority Leader Chuck Schumer, however, reaffirmed his support for Biden. [Extracted from the article]

Several influential congressional Democrats are privately expressing their desire for Joe Biden to step aside as the party's White House nominee. This sentiment comes after Biden's lackluster debate performance against Donald Trump last month. The latest defections include Democratic leaders of House committees, such as Jerrold Nadler and Joe Morelle of New York, Adam Smith of Washington, and Mark Takano of California. However, not all Democrats are calling for Biden to leave the race, and a scheduled meeting with all House Democrats on Tuesday will provide a clearer picture of the sentiment within the caucus. [Extracted from the article]

Several influential congressional Democrats are privately expressing their desire for Joe Biden to step aside as the party's White House nominee. This sentiment comes after Biden's lackluster debate performance against Donald Trump last month. The latest defections include Democratic leaders of House committees, but not all Democrats are calling for Biden to leave the race. The internal party struggle is occurring as Biden works to regain momentum and convince voters of his fitness to serve another four years. [Extracted from the article]

More House Democrats are expressing their desire for Joe Biden to step down as the party's presidential nominee, although there are still divisions within the party. During a private meeting with House Minority Leader Hakeem Jeffries, some participants, including Jerrold Nadler, Joe Morelle, Adam Smith, and Mark Takano, called for a new Democratic presidential ticket following Biden's debate performance against Trump. Discussions about Biden's candidacy will continue among House lawmakers when they return to the Capitol on Monday. [Extracted from the article]

US lawmakers are considering a $100 billion tax deal that would revive expired research and investment tax breaks. The deal, which could be reached as early as this month, would include a retroactive renewal for 2023 of an expired research and development break, as well as a deduction for certain types of interest and expanded depreciation of investments. Democrats are also pushing for the package to include an expanded child tax credit. Talks are ongoing on how to pay for the package, likely through curtailing other tax breaks. The business tax package has been a priority for industry groups and companies such as Microsoft, Ford, Lockheed Martin, and Boeing. [Extracted from the article]

Former Treasury Secretary Lawrence Summers and Donald Trump have engaged in a debate over Trump's proposal to impose a 10% tariff on all imports. Summers disagrees with Trump's claims that such tariffs would benefit the US economically and geopolitically, suggesting that they should be used more selectively. Trump, on the other hand, believes that tariffs provide both economic gain and political leverage. Summers also commented on the state of the economy, stating that while there have been recent signs of slower growth, it is uncertain whether this indicates a more significant slowdown. [Extracted from the article]

The Congressional Budget Office (CBO) has increased its estimate for the US budget deficit in 2024 by 27% to nearly $2 trillion. This projection reflects additional spending, including aid for Ukraine and student loan relief measures enacted by the Biden administration. The CBO also predicts faster economic growth and higher inflation for this year, with the Federal Reserve expected to delay lowering interest rates until the first quarter of 2025. The US deficit is now projected to be 6.7% of GDP in 2024, higher than previous estimates. The CBO warns that deficits are expected to remain large for the next decade, leading to record levels of debt relative to GDP and escalating interest costs. [Extracted from the article]

Donald Trump's proposal to exempt tips from taxation could potentially add $150 billion to $250 billion to the federal budget deficit over 10 years, according to the nonpartisan Committee for a Responsible Federal Budget. This estimate suggests that the deficit impact of the plan could be larger than the projected revenue loss from extending the 2017 tax cuts for small businesses. The tax exemption for tips is part of Trump's strategy to appeal to younger voters, particularly those in the food service and accommodation industries. However, the cost of the proposal could be even higher if employers and employees respond by shifting more compensation from wages to tips. This fiscal obstacle may hinder the enactment of Trump's proposal, as he is already proposing other tax cuts that would cost $4.6 trillion over 10 years. The proposal has received support from Trump's campaign, arguing that tip earners should not be expected to fund government spending. Republicans are divided on whether tax cuts should be offset by spending cuts or other sources of revenue. The 2017 tax cuts were not fully paid for and added $1.5 trillion to budget deficits. Some Republicans are advocating for large cuts to federal spending to address the national debt. [Extracted from the article]

President Donald Trump has suggested using tariff hikes to offset income tax cuts, a move that could impact global trade and consumer prices. During a meeting with House Republicans, Trump expressed his desire to lower income taxes and potentially pay for them through tariffs, particularly on adversarial nations. While some Republican lawmakers have been skeptical of higher tariffs, Trump's pitch was well received. However, using tariffs to offset income taxes would require a significant increase in import levies, potentially leading to higher consumer prices. The suggestion comes as Congress faces a deadline on the expiration of key portions of Trump's 2017 tax cuts, with ideas for offsetting costs including reducing deductions, increasing tariffs, or relying on projected economic growth. The Republican Party, influenced by Trump, has increasingly supported tariffs in recent years. [Extracted from the article]

US lawmakers have not received a pay raise in 15 years, and there is now a push from both Republicans and Democrats to change that. Some lawmakers argue that a salary increase is necessary to attract and retain diverse candidates, especially considering the high inflation in recent years. However, many incumbents are hesitant to vote for a pay raise so close to the November election. Last year, lawmakers implemented a reimbursement system to help cover expenses, which cost taxpayers $5.8 million in its first year. The current salary for a rank-and-file House lawmaker is $174,000 annually, which is significantly higher than the average US worker's pay but lower than salaries in elite professions. Some lawmakers argue that the pay raise should match the increase slated for federal workers next year, which would result in a maximum 3.8% raise. However, opponents argue that lawmakers should prioritize fighting for lower costs for working families rather than increasing their own paychecks. The House Appropriations Committee will vote on the pay raise as part of a spending bill, and opponents are expected to try to block the raise. [Extracted from the article]

President Joe Biden has taken significant action to address the migrant crisis at the US-Mexico border, stating that Republicans left him with no choice but to act alone. He criticized his opponent, Donald Trump, for sinking a bipartisan immigration deal and emphasized the need to bring order to the asylum process. The new measures will close the border to some asylum claims until the number of crossings decreases substantially and raise the threshold for people to stay in the country. Biden's actions have drawn criticism from both progressives and moderates within his own party, and they are likely to face legal challenges. [Extracted from the article]

President Joe Biden is implementing measures to address the surge of border crossings and curb asylum claims. The new policies will temporarily close the southern border to some asylum claims until the number of crossings decreases significantly and will raise the threshold for individuals to stay in the country. These actions are aimed at resetting perceptions of Biden's handling of immigration, but they are likely to face legal challenges and further divide Democrats. Republicans argue that the proposals are insufficient, while progressives criticize them as draconian. The success of these policies will depend on diplomacy, funding, and cooperation from other countries. [Extracted from the article]

New Jersey Democrat Bob Menendez has filed to run for reelection as an independent while on trial for corruption charges. This move could potentially harm the Democratic Party's chances of holding onto the Senate seat, as Menendez could act as a spoiler if a significant number of voters support him. However, Democrats are still expected to win the New Jersey Senate seat, with Democratic Representative Andy Kim being the likely successor to Menendez. Menendez's filing appeared on the New Jersey Department of State's website, listing his party as "Menendez for Senate." Senator Cory Booker, a fellow Democrat, has called Menendez a "tremendous senator" and emphasized the need for a fair trial. Menendez has pleaded not guilty to the charges, and his defense has placed blame on his wife for withholding information. Despite criticism from Senate Majority Leader Chuck Schumer, no action has been taken to expel or punish Menendez. [Extracted from the article]

President Joe Biden will sign an executive order to halt some asylum claims at the US-Mexico border in an effort to reduce migrant crossings. The order will prevent new asylum claims until border crossings decrease by about two-thirds. Once border encounters fall to around 1,500 per day, asylum claims will be allowed to resume. This move is seen as Biden's most aggressive action to address the border crisis and comes after a bipartisan Senate plan was blocked earlier this year. The order is politically risky and may invite criticism from Biden's left flank. [Extracted from the article]

President Joe Biden will sign an executive order to halt certain asylum claims at the US-Mexico border until crossings decrease significantly. The order aims to reduce the flow of migrants and address a major concern before the upcoming election. New asylum claims will be prevented until border crossings decrease by about two-thirds, and the policy will be implemented once levels reach approximately 2,500 crossings per day. The move is politically risky and may face criticism from Biden's left flank, but it highlights the administration's efforts to address the border crisis and the failure of a bipartisan bill. [Extracted from the article]

House Democrats and Republicans joined forces to block an attempt by hardliner Representative Marjorie Taylor Greene to overthrow Speaker Mike Johnson. This rare cross-party alliance was formed to reward Johnson for his help in securing $61 billion in aid for Ukraine. However, Johnson's reliance on partisan opponents to maintain his leadership position leaves his political strength uncertain. While Democratic leaders have not committed to indefinitely supporting him, hardliners can force a new ouster vote at any time. The Republican House majority is so slim that if Democrats withdraw their support, just three Republican lawmakers can remove Johnson. [Extracted from the article]

According to new estimates from Congress's fiscal scorekeeper, extending the 2017 tax cuts enacted under President Donald Trump for households, small businesses, and wealthy individuals would cost $4.6 trillion. This will be a significant issue for lawmakers in Washington next year as they consider the future of these tax cuts, which are set to expire in 2025. The Congressional Budget Office's estimate is more than double the original cost of the Trump tax cuts. Lawmakers may need to find ways to offset the deficit impact through spending cuts or scaling back the rate reductions. President Joe Biden has proposed new tax hikes, while Trump has pledged to renew the tax cuts without releasing a specific plan. The expiring portion of the tax cuts includes reductions in individual tax rates and an expansion of the child tax credit. The Congressional Budget Office also raised its projection for this year's budget deficit, approaching $2 trillion. The sooner lawmakers address deficits, the less painful spending cuts or tax increases will be. The influx of foreign workers through immigration is expected to boost GDP by about $7 trillion over the next decade, according to CBO research. However, the impact on inflation has been limited so far. [Extracted from the article]

The cost of extending the 2017 tax cuts enacted under President Donald Trump has increased to $3.8 trillion over ten years, according to the Congressional Budget Office (CBO). Lawmakers will need to address the deficit impact of renewing the cuts, as the US faces a challenging fiscal outlook. The CBO's estimate is double the original cost of the Trump tax cuts, and the anticipated cost of extending the tax cuts may prompt lawmakers to consider spending cuts or scaling back rate reductions. President Joe Biden has proposed new tax hikes, while Trump has pledged to renew the tax cuts without releasing a specific plan. The expiring portion of the tax cuts includes reductions in individual tax rates and an expansion of the child tax credit. The CBO's new cost estimate for renewing just that portion is higher than last year's estimate. The CBO also raised its projection for this year's budget deficit, emphasizing the need for lawmakers to address deficits sooner rather than later. Deficits are expected to rise to $2.6 trillion by 2034, with debt held by the public reaching 116% of GDP, the highest ever recorded. [Extracted from the article]

The US has revoked licenses that allowed Huawei to purchase semiconductors from Qualcomm and Intel, further tightening export restrictions against the Chinese telecom equipment maker. This decision will impact the sales of chips for use in Huawei phones and laptops. The US government is determined to limit China's access to semiconductor technology and is considering sanctions against six Chinese firms suspected of supplying chips to Huawei. The withdrawal of export licenses has been criticized by China's Ministry of Commerce as "economic coercion" and a violation of World Trade Organization rules. [Extracted from the article]

The Justice Department is expected to announce a criminal indictment of House Democrat Henry Cuellar of Texas. Cuellar has not directly addressed the indictment but stated that he and his wife are innocent of the allegations. The FBI previously searched Cuellar's home and campaign office in relation to an investigation of Azerbaijan and US businessmen with ties to the country. Cuellar plans to run for reelection in November and remains confident in his chances of winning. The indictment could potentially impact the Democratic Party's chances of gaining the House majority next year. [Extracted from the article]

The Justice Department is expected to announce a criminal indictment of House Democrat Henry Cuellar of Texas. Cuellar has not directly addressed the indictment but stated that he and his wife are innocent of the allegations. He plans to run for reelection in November. The FBI previously searched Cuellar's home and campaign office in connection with an investigation of Azerbaijan and several US businessmen. Cuellar has represented a South Texas district along the Mexico border since 2005. [Extracted from the article]

Two Republican hardliners, Marjorie Taylor Greene and Thomas Massie, have announced their intention to force a vote on removing House Speaker Mike Johnson. However, Democratic leaders have pledged to support Johnson, effectively blocking the effort. Johnson's reliance on Democratic support puts him in a vulnerable position, as they can withdraw their support at any time. Greene and Massie criticized Johnson for working with Democrats on funding measures and foreign aid packages. It remains unclear how much support the rebellion has among Republicans, but conservative enthusiasm for ousting Johnson has been waning. [Extracted from the article]

Two Republican hardliners are planning to force a vote to remove House Speaker Mike Johnson, but they are likely to be unsuccessful. House Democratic leaders have promised to join Johnson's Republican allies in blocking the effort, ensuring that he will remain in his position. The move to oust Johnson is being driven by ultra-conservative Representative Marjorie Taylor Greene, who criticizes Johnson's cooperation with Democrats on foreign aid packages and accuses Democrats of supporting him because he gives them what they want. It is unclear how much support the rebellion has among Republicans, but recent departures from the House have left Republicans with a slim majority, making it difficult for them to remove Johnson without Democratic support. [Extracted from the article]

House Democratic leaders have pledged to protect House Speaker Mike Johnson from a potential coup by Republican hardliners. Representative Marjorie Taylor Greene and two other hardliners have threatened to remove Johnson as speaker because of his collaboration with Democrats on a $95 billion foreign aid package for Ukraine, Israel, and Taiwan. In response, House Minority Leader Hakeem Jeffries and other party leaders have issued a joint statement, vowing to use parliamentary tactics to block any attempt to oust Johnson. The effort by Greene and her allies has faced resistance from conservatives in the House Freedom Caucus. [Extracted from the article]

House Democratic leaders have pledged to support House Speaker Mike Johnson against any attempts by Republican hardliners to remove him from his position. Ultra-conservative Representative Marjorie Taylor Greene and others have threatened to seek Johnson's ouster because of his collaboration with Democrats on a foreign aid package. However, the rebellion has faced resistance from conservative members of the House Freedom Caucus. Democratic leaders have issued a joint statement stating their commitment to block any efforts to remove Johnson. Johnson himself has stated that he did not ask for assistance from Democrats and was unaware of their commitment. [Extracted from the article]

The US Senate has passed a $95 billion emergency aid package for Ukraine and other US allies, allowing for the resumption of arms shipments to Kyiv. The Defense Department is prepared to quickly move artillery shells and air defense munitions as part of the aid. President Joe Biden is expected to sign the assistance package, and the US can use supplies already in Europe to expedite the help. The aid is urgently needed due to shortages in weapons and a dire need for air defense systems, which have pushed Ukraine's fighting forces close to a breaking point. The Senate vote ended a six-month delay in aid, highlighting growing isolationism in the Republican Party and undermining US global strategic commitments. The aid package also includes provisions for a potential ban on the TikTok app and aid for Israel and Taiwan. [Extracted from the article]