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Category: Economics

State Farm stops offering insurance in California because of ‘rapidly growing catastrophe exposure’

State Farm stops offering insurance in California because of ‘rapidly growing catastrophe exposure’

The New York Times reports: The climate crisis is becoming a financial crisis. This month, the largest homeowner insurance company in California, State Farm, announced that it would stop selling coverage to homeowners. That’s not just in wildfire zones, but everywhere in the state. Insurance companies, tired of losing money, are raising rates, restricting coverage or pulling out of some areas altogether — making it more expensive for people to live in their homes. “Risk has a price,” said Roy…

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Pandemic-era policies reversed the trend toward a widening income gap. Now those gains are under threat

Pandemic-era policies reversed the trend toward a widening income gap. Now those gains are under threat

Politico reports: For the past three years, low-income workers have made historic gains in wages even after inflation, reversing the trend of advances for upper-income workers and stagnating pay for laborers that dominated the previous four decades, according to a POLITICO analysis of data from the U.S. Labor Department. The gains were the product of a series of dramatic changes in the structure of the labor market and government policies to aid the economy during the pandemic. Fueled by the…

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Drastic climate action is the best course for economic growth, study finds

Drastic climate action is the best course for economic growth, study finds

Yale Climate Connections reports: For decades, many economists’ analyses seemed to justify inaction on weaning the economy from fossil fuels, saying the astronomical cost of such rapid transformation would strangle economic growth. These experts were heeded over scientists who warned that acting too slowly would court climate catastrophe. But in recent years, more economists have begun to agree that the short-term costs of aggressive action are not as high as once thought, while the long-term costs of inaction are much…

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The man in charge of knowing when the U.S. runs out of money

The man in charge of knowing when the U.S. runs out of money

The Washington Post reports: At the beginning of every workday, from his second-floor office in the U.S. Treasury Department, Dave Lebryk starts his morning looking at a color-coded dashboard tracking the most critical operations of the largest payment system in the world. More than $6 trillion flows out of the Treasury every year in payments, salaries and purchase orders, and more than $5 trillion flows in, mostly through tax collections and fees. Lebryk’s job is to make sure that these…

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Why Trump wants the U.S. to default on debt

Why Trump wants the U.S. to default on debt

Dennis Aftergut writes: Lest you have any doubt, the three exclamation points are Trump’s. You could be excused for thinking he wants a default. He loves chaos. But he also has a purely self-serving reason to seek an economic catastrophe. You don’t need to be a stable genius to know that a bad economy typically hurts the incumbent in a presidential race. And Trump is desperate to get the immunity from prosecution that being elected president would provide him. He’s…

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The war on poverty is over. Rich people won

The war on poverty is over. Rich people won

Annie Lowrey writes: Why do so many Americans live in poverty? Because so many rich people benefit from it. This is the thesis of the lauded sociologist Matthew Desmond’s new book, Poverty, by America. The best seller is at once a careful exploration of poverty statistics; a deeply reported depiction of the lived experiences of the poor; an examination of the ways America’s wealthy exploit the masses; and a case for ending poverty. Desmond shows how the country’s employers, financial…

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Declaring the debt ceiling unconstitutional is risky, Biden aides fear

Declaring the debt ceiling unconstitutional is risky, Biden aides fear

The Washington Post reports: Senior White House officials see enormous risks in trying to resolve the debt ceiling impasse without Congress, viewing the unilateral measures floated by some academics only as emergency measures of last resort, according to three people with knowledge of internal conversations. As they have for months, Biden aides have recently been evaluating a wide range of proposals for acting on the debt limit without the consent of Congress — particularly by invoking the 14th Amendment of…

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Why I changed my mind on the debt limit

Why I changed my mind on the debt limit

Laurence H. Tribe writes: At this moment, at the White House as well as the Departments of Treasury and Justice, officials are debating a legal theory that previous presidents and any number of legal experts — including me — ruled out in 2011, when the Obama administration confronted a default. The theory builds on Section 4 of the 14th Amendment to argue that Congress, without realizing it, set itself on a path that would violate the Constitution when, in 1917, it capped the size of the…

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Advice to Biden on how to handle House Republicans’ demands for raising the debt ceiling

Advice to Biden on how to handle House Republicans’ demands for raising the debt ceiling

Robert Reich writes: If House Republicans refuse to raise the limit on the amount of money America may repay on what it owes — the deceptively named “debt limit” — they might force the United States to default, pushing interest rates into the stratosphere and shaking the world economy. President Biden rightfully says that raising the so-called debt ceiling should not be negotiable. After all, Democrats joined Republicans during the Trump administration to raise it three times, even as Trump…

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The World Bank is getting a new chief. Will he pivot toward climate action?

The World Bank is getting a new chief. Will he pivot toward climate action?

The New York Times reports: As World Bank shareholders gather in Washington for their annual spring meeting on Monday, the global institution appears to be on the brink of significant change. World leaders, led by Prime Ministers Emmanuel Macron of France and Mia Mottley of Barbados, along with a constellation of academics and development experts want the bank to do more to help poor countries grappling with climate change. The bank has set out its own vision for transformation, in…

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Video: Alexander Skarsgård, Partha Dasgupta and the answer to everything

Video: Alexander Skarsgård, Partha Dasgupta and the answer to everything

  Partha Dasgupta is a Cambridge University economist who in 2021 prepared a more than 600-page report for the British government about the financial value of nature. Not your average bedtime reading. But believe us when we say his report, the culmination of decades of scholarship, is incredibly important. Or at least believe the United Nations, which awarded him the title Champion of the Earth for his work. Or King Charles III, who this year made Mr. Dasgupta a Knight…

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America is in a disgraced class of its own

America is in a disgraced class of its own

Matthew Desmond writes: The United States has a poverty problem. A third of the country’s people live in households making less than $55,000. Many are not officially counted among the poor, but there is plenty of economic hardship above the poverty line. And plenty far below it as well. According to the Supplemental Poverty Measure, which accounts for government aid and living expenses, more than one in 25 people in America 65 or older lived in deep poverty in 2021,…

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In a sea of data there is a dwindling supply of vital economic data

In a sea of data there is a dwindling supply of vital economic data

The Wall Street Journal reports: In recent months, markets have been laser-focused on every scrap of economic data for evidence on whether inflation is coming down or a recession is approaching. Unfortunately, that data suffers from a growing problem: reduced responses from the people whose activity it seeks to measure. “There’s more data than there has ever been in the history of the world,” said Torsten Slok, the chief economist of Apollo Global Management Inc. “But the Fed has a…

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Indigenous knowledge is key to sustainable food systems

Indigenous knowledge is key to sustainable food systems

Alexandre Antonelli writes: I grew up in Campinas, a city in southeast Brazil. The apples there, cultivated from European varieties since the 1960s, tasted sweet. But, given the choice, I would always pick papayas grown in our garden. My father, who knew that growing a temperate fruit tree in a tropical country seldom worked, instead filled our garden with tropical ones, including two varieties of papaya. Meanwhile, drawing on knowledge from her Indigenous roots, my mother grew all sorts of…

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Shrinking population presents major implications for China, its economy and the world

Shrinking population presents major implications for China, its economy and the world

The New York Times reports: The world’s most populous country has reached a pivotal moment: China’s population has begun to shrink, after a steady, yearslong decline in its birthrate that experts say is irreversible. The government said on Tuesday that 9.56 million people were born in China last year, while 10.41 million people died. It was the first time deaths had outnumbered births in China since the Great Leap Forward, Mao Zedong’s failed economic experiment that led to widespread famine…

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The U.S. may finally breach the debt ceiling. Here’s why that would be very bad

The U.S. may finally breach the debt ceiling. Here’s why that would be very bad

The New York Times reports: The new Republican majority in the House of Representatives has Washington and Wall Street bracing for a revival of brinkmanship over the nation’s statutory debt limit, raising fears that the fragile U.S. economy could be rattled by a calamitous self-inflicted wound. For years, Republicans have sought to tie spending cuts or other concessions from Democrats to their votes to lift the borrowing cap, even if it means eroding the world’s faith that the United States…

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