Money talks; reviewing the global economy, government spending, taxes, and economic policy that affect our social and political future.
All the Meaningless Zeroes
Today, in its first budget for over two years, the Government of Canada posted a deficit surpassing 100% of Canada’s Gross Domestic Product (GDP).
Punjab Finance Minister Manpreet Singh Badal discloses Punjab Budget 2021-22
The current politics Punjabi news is all about the most anticipated Punjab Budget for the financial year 2021-22. Punjab Finance Minister Manpreet Singh Badal presented the state budget in the state assembly on Monday, March 8. The budget was with an outlay of Rs. 1,68,015 crore. In his budgetary document, the finance minister proposed spending on many key sectors.
Minimum Wage Increase vs Skilled Workers
One of the big talking point in the new 1.9 Trillion COVID relief bill is an increase of the minimum wage to $15 an hour for jobs that require minimal skills, but how does this affect skilled jobs? One of the things that is discussed is how 1.4 million jobs will be lost, which is unacceptable. How this will hurt small businesses and look at hiring less people in favor for automation to cut cost. What about devaluing skilled jobs like nurses, teachers, other healthcare professions, skilled labors like HVAC, mechanics and many more? Why is the media ignoring this part, where people go to either trade schools or community college to get degrees in these fields that starts at $15 an hour or lower? How will the increase of the minimum wage affect businesses like construction, doctors offices, law offices, auto repair shops, airlines, media companies, grocery stores, and so on that rely on skilled workers?
Does the U.S. National Unemployment Rate Accurately Describe Labor Market Conditions during the Covid-19 pandemic?
To answer this question, we go behind the scenes of this iconic statistic to garner a more accurate read of actual U.S. labor market conditions. First, it is important to mention that the U.S. Unemployment rate jumped from 3.5% in Feb. 2020 (pre-pandemic) to a peak of 14.8% in April 2020 and has since dipped to a much more favorable 6.3% reading as of Jan. 2021. On the surface, some may be tempted to interpret this movement as signaling that we are getting closer to declaring victory against the worse labor market collapse since the Great Depression in 1929!
How to Raise the National Minimum Wage Fairly and Avoid Massive Job Losses?
There is considerable debate about raising the National Minimum Wage to $15.00 per hour. Not surprisingly, since adjusting such wages upward on a national basis is a blunt instrument, the Congressional Budget Office (CBO) estimates that raising the national minimum wage to $15.00 per hour could result in the loss of 1.4 million U.S. jobs.
Why Minimum Wage is Outdated and Harmful
Minimum wage has continued to be a divisive issue since its conception in 1938. Advocates insist it gives the poorest of the population a living wage to ensure that they can support themselves. Critics have claimed everything from minimum wage actually hurting the poorest by promoting discrimination to the idea accomplishing nothing at all since the economy simply readjusts in response, leaving things exactly how they were.
Why does US Congress make more than 95% of Americans?
When the United States of America was established, the country’s government was supposed to be for the people, by the people. If you look at the government of the United States today, do you feel that’s how it is? Do you feel that the government is for you, or do you feel that it is for itself? Does it seem like our representatives have their best interests in mind for us, or their own wallets?
Is the U.S. Government Doing Too Little or Too Much To Help The Economy During the Covid-19 Pandemic?
Yes, they are on both counts! Nominal U.S. GDP reached it trough in Q2:2020 and was down $2.2T but in Q3:2020 it was down by just $580b, respectively from Q4:2019. Yet, in Dec. we passed a $935b stimulus relief bill and are now trying to pass another $1.9T dollar package. That is about $2.8T worth of economic relief to plug up a shortfall of $580b as of Q3:2020. This is on top of the $3.5T worth of additional stimulus (e.g., the CARES Act and several others) prior to the stimulus package signed in Dec. 2020. Interestingly, the economic shortfall from this pandemic is expected to narrow further in Q4:2020 as Real GDP is likely to grow by around 5.0%. To be sure, if much of the recent proposed economic stimulus legislation is approved by Congress and signed into law by the President --- U.S. real GDP in 2021 is likely to grow by 6.0% after contracting by about 3.5% in 2020.
Biden's Economic Balancing Act
When President-Elect Biden proposed his latest economic recovery plan the intentions of which are sound but, therein lies potential setbacks to authentic economic stabilization of our economy. We have to point out that any increase in basic wages my sound like a dream come true for millions but, conversely consumer goods have always risen proportionally to any increase in incomes. A case in point : When the Alaska pipe line was being constructed wages for the average construction worker was around $80,000 per year. What was not readily explained was the fact that rent, food, even gas for commuting correspondingly rose as well. The bottom line is the fact that these construction workers barely had enough disposable income to really have any net gain in their financial situation.
Reasons for wealth inequality in the world today
Unemployment Unemployment is a key contributory factor that can lead to poverty. Those who are unemployed can find themselves trapped in a cycle of deprivation as they do not have the income needed for a basic standard of living or the opportunities to gain the skills required to gain employment.
Bryan Watch - Dec 2020
Obviously, the biggest debate in Congress this month has been over providing addition relief for Americans impacted by the COVID pandemic. After Congress passed a $600 relief bill, President Trump called for Congress to increase checks to $2000.
Millennials 'more likely to face working-age poverty than any previous generation'
The generation of millennials, young people who have come of age with the entry of the new millennium, has a much more complex present and future than other generations. Millennials hardly own their homes and have no financial assets. However, they do have a significant burden of debt, especially consumer credit to buy goods and services that will not generate a return in the future. In conclusion, Spanish millennials present a much more complex financial situation than past generations.