The challenge of re-opening businesses during pandemic

Are we opening too fast? That’s one of the main questions we face as the nation and the world struggles to get economies moving again during the Coronavirus pandemic. As pointed out in the video about, there’s still quite a bit we don’t know about this virus and what are the safest ways to re-open.

We also have some extremists who want to pretend that there isn’t any real danger here. That complicates things as some irresponsible people can be a threat to others who try their best to be safe.

We will learn a lot over the next several months, and some of those lessons may be painful if we move too fast. We don’t want this terrible recession to turn into a long-term depression.

  

The importance of immigrants to the US economy

Here’s one example of why immigrants have been the secret sauce of the success of American economy for generations. The entrepreneurial spirit of immigrants cannot be denied.

  

CEOs try to push Congress to end shutdown and debt limit insanity

dollar bills spelling USA

Wall Street and the business community have supported Republicans for years, but now many of them are stunned to see the utter contempt that many Tea Party Republicans have for the financial system. While some understand the point of using leverage in negotiations, the willingness to tempt fate with a potential default on the national debt is making many CEOs nervous. GOP representatives are now hearing an earful from those business interests that helped raise a ton of money for them, and now CEOs are getting involved. Their ideal solution is to get a big budget defiicit deal, but they have had to impress on many members the potential for economic catastrophe if we get to the brink of defaulting on the national debt.

There are very strong opinions on all side of the government shutdown and the debt debate, but the plain fact is that the GOP is engaging in political extortion, and the President is not willing to let them get away with it.

Many Republicans from the beginning saw this as a failed strategy, and now even more are becoming frustrated as John Boehner again doesn’t seem to have an out. It’s a mess, and hopefully at some point this will be resolved without a full-blown crisis.

  

New proposal for corporate tax reform

The Obama administration is trying to revive talks about corporate tax reform that could see the top rate in the US drop from 35 percent to 28 percent. This time, in order to strike a deal with House Republicans, Obama is linking his corporate tax proposal to other proposals for investments that would trigger growth in middle class jobs, such as infrastructure investments.

This offers another test as to whether House Republicans are remotely interested in governing as opposed to reflexively opposing anything Obama stands for. Most House Republicans strongly favor corporate tax reform, and many of them also understand the importance of investments like infrastructure.

This proposal should also generate support among business lobbyists as well, though Obama’s insistence on some sort of minimum tax for foreign corporate earnings will still be a problem for many multinationals.

Something needs to happen, however, as the current system is riddled with loopholes.

  

Federal budget outlook is improving

dollar bills spelling USA

The economy is steadily improving, and now we’re seeing improvement with the US budget deficit.

In February, the nonpartisan Congressional Budget Office predicted that this year’s deficit would fall to $845 billion, down from nearly $1.1 trillion in 2012. Goldman Sachs recently predicted that the deficit would fall even further, to $775 billion, and return to sustainable levels within two years.

As a result, the national debt is rising far more slowly than in the frantic days after the 2008 economic crisis: The Treasury Department actually expects to repay a tiny sliver of the $16.8 trillion national debt by the end of June.

Much of the improvement stems from recent budget deals. Over the past two years, Congress has capped agency spending and created the sequester, which is trimming outlays on domestic programs and the military. Lawmakers also agreed to raise taxes on virtually every American this year, letting a temporary reduction in the payroll tax expire and tax rates rise for households earning more than $450,000 a year.

But other factors are at work, too. Defense spending has been declining rapidly with the end of the war in Iraq and the ongoing drawdown of forces in Afghanistan. A surprising — and apparently durable — slowdown in health-care costs has sharply reduced projected spending on Medicare and Medicaid. And the falling jobless rate and improving economy have helped push federal tax collections up 16 percent over last year, according to figures out Tuesday.

This will have interesting implications for budget talks, but also should start instilling some confidence with business leaders, which hopefully then fuels even more economic growth.

  

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