From cleanup to science to research, federal funding freeze raises Great Lakes concerns
The sweeping move by the Trump administration has cast uncertainty over funding long considered essential for protecting the basin, monitoring its health and preserving its maritime heritage through marine and shipwreck sanctuaries.
And while Congressional Democrats challenge the order's legality, scientists, agencies and environmental groups are left to wait and see what happens next.
Here's what we know so far about what the federal funding freeze means for the Great Lakes region and Milwaukee.
More: Trump orders temporary freeze on federal grants. Here's how that could affect Wisconsin
Milwaukee Metropolitan Sewerage District communications manager Bill Graffin expressed concern about how the pause would impact the "area of concern" cleanup effort in Milwaukee. The "areas of concern" are the most polluted and damaged sites across the basin, largely due to legacy contamination from industry and habitat degradation.
Funding for the massive cleanup effort is through the Great Lakes Restoration Initiative, which has provided targeted funding towards restoring the most polluted sites in the Great Lakes basin, like Milwaukee.
The city has greatly benefited from the program; it recently received $450 million in federal grants from the program. Projects include dredging contaminated sediment at the bottom of Milwaukee's three rivers and Lake Michigan; building a new facility that will hold the contaminated sediment; and restoring fish habitat and beaches, like at Bay View's South Shore Park.
Much of the funding for the area of concern cleanup is targeted towards environmental justice efforts as pollution and climate change disproportionately impact communities that face racial and economic marginalization in Milwaukee. Targeted funding towards these efforts may be up in the air as the Trump administration targets diversity, equity and inclusion in federal programs and agencies.
While the move has been couched as a temporary pause, Don Jodrey, the director of federal relations at the Alliance for the Great Lakes, said that if it does become permanent there would be negative consequences throughout the Great Lakes and in Milwaukee.
'Citizens of Milwaukee can identify how important the area of concern cleanup effort is, and it won't go forward without federal funding,' Jodrey said.
More: Great Lakes, PFAS, lead pipes: How Trump's policies could impact Wisconsin's environment
Federal funding helps keep science moving throughout the eight Great Lakes states.
Rebecca Klaper, dean of UW-Milwaukee School of Freshwater Sciences, expressed concern over delays in receiving federal funds to support research, staff and small business grants through the School. Federal selection committees and panels to select future grant recipients were canceled this week, Klaper said.
Federal funding is really important for the science and technology workforce. 'We are crossing our fingers,' Klaper said.
The National Oceanic and Atmospheric Administration, or NOAA, is a federal agency that plays a big role in research and monitoring in the Great Lakes. The agency also funds projects to help coastal communities build resilience and manage flooding, as climate change brings wetter weather and greater swings in lake levels in Wisconsin.
NOAA also helps protect the basin's history and ecosystems through its national marine sanctuaries, like the Wisconsin Shipwreck Coast National Marine Sanctuary in Lake Michigan and the Thunder Bay National Marine Sanctuary in Lake Huron.
Scott Smullen, deputy director of NOAA communications, said in an emailed statement that NOAA cannot speculate on future actions or potential changes at this time, but the agency 'remains dedicated to its mission, providing timely information, research, and resources that serve the American public and ensure our nation's environmental and economic resilience.'
Caitlin Looby is a Report for America corps member who writes about the environment and the Great Lakes. Reach her at clooby@gannett.com, follow her on X @caitlooby and learn more about how she approaches her reporting.
Please consider supporting journalism that informs our democracy with a tax-deductible gift to this reporting effort at jsonline.com/RFA or by check made out to The GroundTruth Project with subject line Report for America Milwaukee Journal Sentinel Campaign. Address: The GroundTruth Project, Lockbox Services, 9450 SW Gemini Dr, PMB 46837, Beaverton, Oregon 97008-7105.
This article originally appeared on Milwaukee Journal Sentinel: What to know about how federal funding freeze could impact Great Lakes
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In it, Nunn, one of the nation's most vulnerable incumbents, talks to constituent Sarah Curry about how the expanded child tax credit will help with the cost of one child's speech therapy. Nunn is also planning to use the state fair as the backdrop for more videos selling the bill's provisions temporarily cutting taxes on tips and overtime. Economic issues — namely, Trump's tax package and his tariff war with countries that buy much of Iowa's agricultural products — will be front and center in Nunn's race, and he's eager to get a jumpstart defining the issues. So, too, are Democrats, who see Iowa's two swing districts as must-wins in their push to take back the House majority. Democrat Jennifer Konfrst, who is working to unseat Nunn, said she approaches Iowans at the fair asking them what keeps them up at night and the answer is usually 'costs.' Read more here. (Bloomberg) — Republican Representative Zach Nunn is making an Iowa State Fair video about President Donald Trump's tax law, shot on a John Deere tractor under the blazing August sun. In it, Nunn, one of the nation's most vulnerable incumbents, talks to constituent Sarah Curry about how the expanded child tax credit will help with the cost of one child's speech therapy. Nunn is also planning to use the state fair as the backdrop for more videos selling the bill's provisions temporarily cutting taxes on tips and overtime. Economic issues — namely, Trump's tax package and his tariff war with countries that buy much of Iowa's agricultural products — will be front and center in Nunn's race, and he's eager to get a jumpstart defining the issues. So, too, are Democrats, who see Iowa's two swing districts as must-wins in their push to take back the House majority. Democrat Jennifer Konfrst, who is working to unseat Nunn, said she approaches Iowans at the fair asking them what keeps them up at night and the answer is usually 'costs.' Read more here. Tariffs' impact on Walmart, other retailers' earnings about to come into focus Several major retailers will report earnings this week, which may give a first glimpse into how President Trump's tariffs have affected their bottom lines. The list includes Walmart (WMT), Target (TGT), Home Depot (HD), Lowe's Companies (LOW) TJ Maxx parent TJX Companies (TJX) and Ross Stores (ROST). The Trump administration has urged retailers not to raise prices for consumers to offset the tariffs' impact, with a particular focus on Walmart, The Street reminds us: Read more here. Several major retailers will report earnings this week, which may give a first glimpse into how President Trump's tariffs have affected their bottom lines. The list includes Walmart (WMT), Target (TGT), Home Depot (HD), Lowe's Companies (LOW) TJ Maxx parent TJX Companies (TJX) and Ross Stores (ROST). The Trump administration has urged retailers not to raise prices for consumers to offset the tariffs' impact, with a particular focus on Walmart, The Street reminds us: Read more here. Trump's trade war not likely to cause recession, Moody's economist says Economist Justin Begley of Moody's Analytics tells USA Today that President Trump's economic policies won't cause a recession or stagflation, but will likely slow growth and push up inflation. The economy isn't in stagflation yet, Begley said, "but it's edging that way," he adds: Read more here. Economist Justin Begley of Moody's Analytics tells USA Today that President Trump's economic policies won't cause a recession or stagflation, but will likely slow growth and push up inflation. The economy isn't in stagflation yet, Begley said, "but it's edging that way," he adds: Read more here. Commerce department applies 50% steel, aluminum tariffs to more products (Reuters) -The Trump administration widened the reach of its 50% tariffs on steel and aluminum imports by adding hundreds of derivative products to the list of goods subject to the levies. In a Federal Register notice late on Friday, the Commerce Department said the Bureau of Industry and Security was adding 407 product codes to the Harmonized Tariff Schedule of the United States that identify the goods to be hit with the additional duties on the steel and aluminum content of those products. The non-steel and non-aluminum content will be subject to the tariff rates President Donald Trump has imposed on the goods originating from specific countries, the notice said. The levies on the goods on the expanded list go into effect on August 18. Read more here. (Reuters) -The Trump administration widened the reach of its 50% tariffs on steel and aluminum imports by adding hundreds of derivative products to the list of goods subject to the levies. In a Federal Register notice late on Friday, the Commerce Department said the Bureau of Industry and Security was adding 407 product codes to the Harmonized Tariff Schedule of the United States that identify the goods to be hit with the additional duties on the steel and aluminum content of those products. The non-steel and non-aluminum content will be subject to the tariff rates President Donald Trump has imposed on the goods originating from specific countries, the notice said. The levies on the goods on the expanded list go into effect on August 18. Read more here. Consumers' inflation expectations rise amid Trump tariffs Inflation expectations rose from July to August, indicating that consumers remain uncertain about President Trump's trade policies. 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Year-ahead inflation expectations increased to 4.9% from 4.5% last month, according to the University of Michigan's survey of consumers. Long-run inflation expectations also rose to 3.9% in August from 3.4% in July. "Overall, consumers are no longer bracing for the worst-case scenario for the economy feared in April when reciprocal tariffs were announced and then paused," Joanne Hsu, the university's Surveys of Consumers director, wrote. "However, consumers continue to expect both inflation and unemployment to deteriorate in the future." Consumer sentiment also deteriorated month over month, falling for the first time in four months. The University of Michigan's Consumer Sentiment Index fell to 58.6 from 61.7 a month ago. Read more here. US import prices rebound in July on higher consumer goods costs US import prices rebounded in July in the latest sign that inflation is set to pick up because of tariffs. Reuters reports: Read more here. US import prices rebounded in July in the latest sign that inflation is set to pick up because of tariffs. Reuters reports: Read more here. Trump says semiconductor tariffs could reach 300% President Trump said Friday he is planning on unveiling tariffs on semiconductor imports over the next two weeks, hinting that those duties could reach as high as 300%. From Bloomberg: Read more here. President Trump said Friday he is planning on unveiling tariffs on semiconductor imports over the next two weeks, hinting that those duties could reach as high as 300%. From Bloomberg: Read more here. Applied Materials' shares sink on weak China demand, tariff risks Shares in Applied Materials (AMAT) sank 14% before the bell on Friday after the chip equipment maker issued weak fourth-quarter forecasts on sluggish China demand, fueling concerns over tariff-related risks. Reuters reports: Read more here. Shares in Applied Materials (AMAT) sank 14% before the bell on Friday after the chip equipment maker issued weak fourth-quarter forecasts on sluggish China demand, fueling concerns over tariff-related risks. Reuters reports: Read more here. Sign in to access your portfolio
Yahoo
26 minutes ago
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Analysis-Trump's interest rate demands put 'fiscal dominance' in market spotlight
By Davide Barbuscia NEW YORK (Reuters) -As U.S. debt swells and the White House leans on the Federal Reserve to cut interest rates, investors are weighing the risk of "fiscal dominance," a scenario where keeping government financing cheap eclipses the fight against inflation. A budget bill passed last month by the Republican-controlled Congress is set to pile trillions onto the swelling U.S. debt load - raising the cost of servicing that debt. U.S. President Donald Trump has meanwhile made explicit calls for the Fed to cut rates, in part to lower the U.S. government's interest costs. The White House's pressure campaign has raised concerns that the administration wants the Fed to return to a bygone era when it kept rates low in order to allow for lower-cost borrowing. "(Fiscal dominance) is a concern ... There are risks on the horizon, both from the perspective of increasing debt loads and the probability for higher structural inflation, or at minimum, more volatility of inflation," said Nate Thooft, chief investment officer for equity and multi-asset solutions at Manulife Investment Management. "The reason why the Trump administration and politicians in general ... would like to see lower rates, is because it actually requires lower rates to be able to afford the debt levels that we have outstanding," he said. The U.S. experienced fiscal dominance during and shortly after World War Two, when the Fed was required to keep interest rates low for the war borrowing effort. The inflation spike that followed led to the 1951 Treasury-Fed accord that restored central bank independence. High long-term Treasury yields and a sliding dollar already reflect that economic setup, some analysts say, as investors require more compensation to hold U.S. assets that could lose value if inflation rises. "The administration wants to outgrow the debt ... but the other way to deal with the debt is to inflate it away," said Kelly Kowalski, head of investment strategy at MassMutual, who sees the dollar continuing to weaken. Higher inflation would mean the real value of government debt shrinks. Trump said last month that the Fed's benchmark interest rate should be three percentage points lower than the current 4.25%-4.50% range, arguing that such a reduction would save $1 trillion per year. He separately said the central bank could raise rates again if inflation rose. In the 12 months through June, inflation as measured by the Personal Consumption Expenditures Price Index advanced 2.6% - still above the Fed's 2% target. Fed Chair Jerome Powell, however, has explicitly said that the U.S. central bank does not consider managing government debt when setting its monetary policy. Some investors argue fiscal dominance lies on an uncertain horizon, with rising debt yet to trigger unsustainable interest rates, while others see it already seeping into markets as long-term yields remain elevated even amid expectations of Fed rate cuts. White House spokesperson Kush Desai said the Trump administration respects the Fed's independence, but that, with inflation having come down significantly from its highs in recent years, Trump believes it's time to reduce rates. The U.S. central bank so far has resisted those demands, though it is expected to lower borrowing costs at its September 16-17 meeting. It declined to comment on this story. FED'S MANDATE The dollar is down about 10% this year against a basket of major currencies while Treasury term premiums - the extra compensation investors demand for holding long-term debt - are high, even as yields have recently dipped amid slowing economic growth. "It's difficult to be bullish (on) long bonds in this environment," said Oliver Shale, an investment specialist at Ruffer, citing government spending that could keep inflation elevated and erode bond values. "If you have an economy that's running above its natural output, that's going to result in inflation or have important implications for inflation, interest rates, and probably the currency," he said. Thooft at Manulife said he was bearish on long-dated Treasuries as higher inflation would require higher term premiums. Despite years of economic growth, U.S. deficits have continued to balloon. Debt now stands at more than 120% of GDP, higher than after World War Two. The Fed normally manages inflation while Congress maintains fiscal discipline. That balance inverts under the fiscal dominance scenario, with inflation driven by fiscal policies and a Fed trying to manage the debt burden, said Eric Leeper, an economics professor at the University of Virginia. "The Fed cannot control inflation and keep interest payments on the debt low. Those are in conflict," Leeper said. One red flag for investors is the narrowing gap between interest rates and economic growth. Benchmark 10-year yields have hovered around 4.3% in recent weeks, while nominal GDP grew at an annual rate of 5.02% in the second quarter. When interest rates exceed the growth rate, debt as a percentage of gross domestic product typically rises even without new borrowing, making the debt increasingly unsustainable. "Risks to Fed independence stemming from fiscal dominance are high," Deutsche Bank analysts said in a recent note, citing high deficits and long-term rates close to nominal GDP growth. 'DOVISH BIAS' History offers cautionary tales. Extreme fiscal dominance triggered hyperinflation in Germany in the early 1920s and in Argentina in the late 1980s and early 2000s. More recently in Turkey, pressure on the central bank to keep interest rates low undermined policy credibility and fueled a currency crisis. A majority of economists polled by Reuters last month said they were worried the Fed's independence was under threat. Despite a barrage of criticism from Trump and administration officials, Powell has vowed to remain Fed chief until his term expires in May 2026. "It seems relatively clear that whoever is nominated for the seat, regardless of whatever views they've espoused in the past, is likely to articulate a dovish bias in order to be nominated," said Amar Reganti, a fixed income strategist at Hartford Funds and former Treasury official. Lower interest rates, however, might only be a temporary fix. The administration may be hoping to "juice nominal growth," despite the risk of creating higher inflation, to get to a place where real growth makes the debt trajectory sustainable, said Brij Khurana, a fixed income portfolio manager at Wellington. "The problem they have is ... the central bank is saying: 'I don't want to make that bet with you.'"
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Facing Trump tariffs, India's shrimp farmers consider switching to other businesses
By Rishika Sadam HYDERABAD, India/GUAYAQUIL, Ecuador (Reuters) -On India's southern coast, V. Srinivas thrived for two decades by farming shrimp, as the country became the top supplier of the delicacy to the United States. Now, Donald Trump's 50% tariff threat is forcing many to consider other ways of making money. Andhra Pradesh state sends the most shrimp from India to the U.S. and farmers there have spent millions of rupees (hundreds of thousands of U.S. dollars) over the years to cultivate high-quality shrimp in saline ponds. Now they are being hit hard as Indian exporters have slashed rates they offer farmers by almost 20% after the tariff shock, wiping out most of their profits. "I am contemplating if I should do fish farming," said the 46-year-old from Veeravasaram village who has already mortgaged his family property and has $45,800 in outstanding loans. "These prices will not help me get any profits and I will not be able to pay off my loan." The United States is the biggest market for India's shrimp farmers and exporters, with clients including U.S. supermarket chains such as Walmart and Kroger. Last year, total seafood exports from India globally stood at $7.4 billion, with shrimp accounting for 40%. But the industry is now in troubled waters with President Trump's 25% tariff on imports from India already in place - the highest among major economies, and another 25% levy to kick in from August 27 to penalize New Delhi for buying Russian oil. By comparison, Ecuador, India's main rival for shrimp exports to the U.S., faces a much lower 15% tariff, heightening its competitive edge. In Andhra, there are around 300,000 farmers engaged in shrimp farming, selling products to dozens of exporters who ship to America. Pawan Kumar, head of the Seafood Exporters Association of India, said orders from U.S. clients have been paused in recent weeks as buyers aren't willing to absorb the tariff, and neither can exporters, forcing the latter to cut prices they pay to farmers. Although India also sells shrimp to other countries such as China, Japan and the UK, and likely will look to expand sales there and diversify into new markets, "that's not going to happen overnight," Kumar said. The impact is yet another example of how Trump's tariff threats are causing business disruptions across the world, especially in India, given it faces one of the steepest levies that have soured its relations with Washington. In Andhra, six of 12 farmers Reuters interviewed said they were considering putting shrimp farming on hold and looking at fish farming, vegetable retailing or other local businesses to tide over the crisis. The other six are choosing to wait it out a bit. Each round of shrimp cultivation takes about 2 months or more. While prices being offered for their shrimp are being slashed, the farmers said they still face loan payments and high operating costs for electricity, raw material and feed, as well as high land rentals. "There's hardly a 20-25% profit for us on good days, and if that's getting eaten up, what else is left?," said Gopinath Duggineni, the chief of a local union in Ongole city, adding the farmers plan to seek financial support from the state government. Ecuador, meanwhile, is closely tracking tariffs on India to seize on business opportunities, but producers there will go slow on new investments amid uncertainty over whether India and the Trump administration could strike a tariff deal, said Jose Antonio Camposano, president of National Chamber of Aquaculture of Ecuador. "India's exports are highly concentrated in the United States ... just as China is for us. So that is where we could gain ground if India withdraws," he said.
