New Video: Where is Washington Taking Us?
Bankrupting America, a project of Public Notice, today released a 60-second web video, “Where Washington is Taking Us,” highlighting the results of Washington’s reckless economic and fiscal policies and the true impact on American families, students and small businesses. The video uses stop-motion-animation to present today’s hard economic realities with the underlying message that the American people cannot afford to let Washington continue to take us down a path towards high unemployment, massive debt and a reduced quality of life. “Washington spent trillions of dollars to improve the economy, but it seems like it’s getting worse; unemployment is still over 8 percent, college tuition is up, gas prices have doubled, we’re borrowing nearly $40,000 every second, and the Senate hasn’t passed a budget in more than three years,” said Gretchen Hamel, executive director of Public Notice. Click here to watch the video.
“Social Security’s Woes Are Worse Than You Think”
Bloomberg reports, “While the Romney and Obama camps have made increasingly bitter accusations about each other’s plans for Medicare, a bipartisan consensus on entitlements has emerged in the past few years. Too bad that consensus is wrong. On both left and right, the politicians and the experts are saying the U.S. needs to fix Medicare — and have made fixing Social Security an afterthought. President Barack Obama has signed changes to Medicare into law, but has done nothing about Social Security. For two years in a row, Republicans in Congress have supported budgets that rein in the growth of Medicare spending but leave Social Security alone. … Right now, we spend more money on Social Security than on Medicare, and that will remain the case for a while. The programs’ trustees project that by 2035 Social Security will consume 6.4 percent of the economy and Medicare 5.7 percent. The Medicare projection may be optimistic about recent attempts to impose cost controls, but we shouldn’t expect Medicare to become vastly larger than Social Security in the next two decades.”
Threat of Tax Hikes Pushing Companies Overseas
The Wall Street Journal reports, “More big U.S. companies are reincorporating abroad despite a 2004 federal law that sought to curb the practice. One big reason: Taxes. Companies cite various reasons for moving, including expanding their operations and their geographic reach. But tax bills remain a primary concern. A few cite worries that U.S. taxes will rise in the future, especially if Washington revamps the tax code next year to shrink the federal budget deficit. … Since 2009, at least 10 U.S. public companies have moved their incorporation address abroad or announced plans to do so, including six in the last year or so, according to a Wall Street Journal analysis of company filings and statements. That’s up from just a handful from 2004 through 2008.”
Government’s New Mileage Rules Could Increase Car Prices by Thousands
The Wall Street Journal reports, “The Obama administration released final fuel-economy standards that are set to nearly double the average mileage of cars and light trucks to 54.5 miles per gallon by 2025, risking some political backlash in an effort to curb U.S. oil consumption and greenhouse-gas emissions.The standards, almost identical to those proposed by the administration in November, would require steady increases in fuel efficiency for new cars built between 2017 and 2025. The administration has already tightened fuel-economy requirements for the 2012-2016 period. … Bill Underriner, chairman of the National Automobile Dealers Association, said the group applauded increases in fuel economy, but said the cumulative effect of the standards could push new-car prices up $3,000 and ‘shut almost 7 million people out of the new car market entirely.and prevent many millions more from being able to afford new vehicles that meet their needs.’”
Consumer Confidence at 10-Month Low
Bloomberg reports, “Confidence among U.S. consumers fell in August by the most in 10 months as households grew more pessimistic about their employment prospects and the economic outlook. The Conference Board’s index decreased to 60.6 from a revised 65.4 in July, figures from the New York-based private research group showed today. The 4.8-point decrease was the biggest since October. The reading was less than the most- pessimistic forecast in a Bloomberg survey in which the median projection was 66. Rising gasoline prices, a jobless rate that’s been above 8 percent since the start of 2009 and limited income gains are keeping consumers glum. Persistent pessimism raises the risk of a pullback in household purchases that account for about 70 percent of the world’s biggest economy.”
With Fiscal Cliff Looming, Fitch Ratings Warns of Downgrade
MarketWatch reports, “In the midst of convention season, Fitch Ratings gave both political parties something to chew on Tuesday. An executive from the ratings company added his voice to the chorus of experts warning about the dangers posed by the so-called ‘fiscal cliff.’ If Washington does not address the significant debt burden facing the nation in the first half of next year, then Fitch’s triple-A U.S. credit rating faces a ‘significant threat,’ Fitch Ratings Managing Director David Riley said in a television interview on Tuesday.”
U.S. GDP Up Slightly But Growth To Remain Sluggish
The Wall Street Journal reports, “U.S. economic output increased a little more than initially thought in the second quarter, though the overall pace suggests growth will remain sluggish ahead of November’s presidential election. The nation’s gross domestic product–the broadest measure of goods and services produced in the U.S.–grew at an annual rate of 1.7% between April and June, the Commerce Department said Wednesday. The revised figure is up slightly from the previously reported 1.5%, reflecting better trade, consumer spending, and state and local government spending figures.”
Gas Prices At Almost Four-Month High
Bloomberg reports, “Hurricane Isaac and a deadly blast at Venezuela’s Amuay refinery pushed gasoline to an almost four-month high and threatened to revive a debate about energy costs in the run-up to the presidential election in November. Futures jumped yesterday in New York as Isaac forced closures of Gulf Coast refineries and reduced rates at others. That market is also reeling from an Aug. 25 explosion in Venezuela that killed at least 48 people and closed the country’s largest fuel-making plant. … Prices at the pump will be the highest ever for the U.S. Labor Day holiday, AAA said yesterday. The surge reignites an issue that has pitted President Barack Obama, who has called for the elimination of billions of dollars of subsidies enjoyed by the oil and gas industry, against the presumptive Republican nominee Mitt Romney. It also spurs speculation that Obama will release supplies from the Strategic Petroleum Reserve to ease prices for consumers.”