Showing posts from September, 2021

Democrats to Increase Taxes and Spending, Setting New Records

Higher taxes and increased government spending will generally slow economic growth. This correlation has been supported throughout history many times, but it's something not generally discussed by Democrats or the mainstream media.  Here's some examples to get started on the subject. Not everyone is in agreement, but I generally take the position that higher taxes and/or higher government spending takes resources from the private sector, which has a moderating affect on growth: Higher business taxes and lower investment 'not a plan for growth' What Is the Evidence on Taxes and Growth? Tax Rates and Economic Growth Does Government Spending Affect Economic Growth? High Implicit Tax Rates Trap Poor People in the Quicksand of Government Dependency Regardless of where you'll end up deciding what is the "truth," the fact remains that the U.S. taxpayer spends too much money on taxes. According to a recent study by the Bureau of Labor Statistics (BLS), Americans s

Energy Prices Rise: Caps on Supply Affect Markets

By Kelly Evans The Exchange , CNBC The price of fossil fuels keeps surging. The situation in Europe is getting worse. Natural gas prices are spiking through the roof--even worse than they were   last week . Even oil is higher today as Goldman says $80 for U.S. crude could be next, up from about $70 where it's trading today. Why? Because there is "growing scarcity across physical markets," with demand for all energy except oil back at pre-pandemic levels  while "the system is becoming increasingly constrained in its ability to supply goods."    The crucial difference between the energy spike today and any prior one over the past couple decades is that this one comes as policymakers (and "ESG" investors) have  chosen to cap supply . Europe, as I've mentioned, has basically, depending on how you run the numbers to get to "net zero" emissions by 2050,  about 600 gigatons of carbon left  to produce. Even traders are taking the goal seriously t

What No One Is Saying About the Jobs Report

By the Tax Foundation   Last week, a disappointing jobs report came out: only 235,000 jobs were added when closer to 720,000 were expected. President Biden blamed the Delta variant, but that is not the whole explanation. While the Delta variant is a contributor, it is likely companies are also unsure of what the future holds for them as the Biden administration’s international tax plan and the Wyden proposal are debated in Congress, so they’re putting hiring, expansion, and investments on hold. Vice President of Global Projects Daniel Bunn says, “The tax reform in 2017 was helpful in reversing the pressure that U.S. companies felt to shield profits from U.S. taxes. However, if the tax code changes in line with what President Biden has proposed, those incentives for investing in the U.S. would go away, and companies would again feel the pressure to offshore profits and potentially jobs and investment. “You can combat profit shifting by making your country’s tax code more attractive fo

Biden Plan: Highest Corporate Taxes in the OECD

President Biden’s proposal to raise the federal corporate tax rate to 28 percent as part of his plan to fund infrastructure spending would increase the combined average top tax rate on corporate income to 32.4 percent, highest among industrialized countries in the OECD .

It's All About Jobs: August Employment Report Misses

The Bureau of Labor Statistics jobs report for August came out today, and it was way below expectations. The economy added 235,000 jobs, about 500,000 fewer than expected. This year, monthly job growth has averaged 586,000 jobs, according to the report. This is probably due to the issue with the Covid-19 Delta variant.  Nonfarm payrolls rose by 235,000 jobs month-over-month (m/m) in August, well below the Bloomberg consensus estimate of a 733,000 rise, though July's figure was upwardly-adjusted to an increase of 1,053,000. Excluding government hiring and firing, private sector payrolls increased by 243,000, versus the forecasted rise of 610,000, after increasing by an upwardly-revised 798,000 in July.  The labor force participation rate remained at July's 61.7% rate, compared to forecasts of an increase to 61.8%. The Department of Labor said job gains occurred in professional and business services, transportation and warehousing, private education, manufacturing, and other serv

Americans Still Stranded; Labor Day

 Americans still stranded, including high school students. Larry Kudlow shreds Biden's 'anti-work' policies.