In Las Vegas, House Republicans Tout New Budget Bill, No Taxes on Tips
Rep. Aaron Bean (R-Fla.) said the bill 'was born here' after a conversation between Trump and a server galvanized the presidential candidate to support an old idea: no taxes on the first $25,000 earned in tips.
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Yahoo
24 minutes ago
- Yahoo
5 Reasons Trump's Trade Deal With China Is Bad News for the Middle Class
President Donald Trump's latest trade deal with China may look like a diplomatic win, but for the American middle class, it comes with hidden costs. Trending Now: Find Out: While tariffs are being reduced in exchange for promises from Beijing, households could still face higher prices, disrupted supply chains and reduced job growth. Here are four reasons Trump's trade deal with China is bad news for the middle class and what families can do to protect their finances. Higher Consumer Prices Despite Tariff Relief Even as the U.S. and China approach an August trade deal deadline, prices on many consumer goods remain elevated, and middle-class households continue to feel the strain. Some experts argue that the new tariffs may not drastically shift average import prices. However, middle-class families are more likely to feel the impact in specific categories, such as electronics, tools and household goods. 'U.S. companies scrambled to import as many goods as possible to stockpile before new tariffs were fully implemented, mitigating the immediate impact of tariffs on prices,' said Bryan Riley, Director of the Free Trade Initiative at the National Taxpayers Union. Riley said that since imports from China account for just 13.2% of total U.S. imports, increases in the price of specific Chinese goods may not push up the overall import average. However, they can still significantly affect middle-class budgets for everyday items. Read More: Erosion of Real Incomes and Job Losses An analysis by the Federal Reserve Bank of San Francisco warned that Trump's trade measures could cut national real income by around 0.4%, while losses in services and agriculture might offset job gains in manufacturing. 'What's pitched as economic growth is actually a slow bleed: Manufacturing jobs won't magically return, and small businesses relying on predictable import costs are about to face more whiplash,' said Patrice Williams Lindo, CEO of Career Nomad. 'Wages stay stagnant while everyday costs climb. And here's the kicker — there's no workforce investment baked into this deal. That means your job security, benefits and opportunities to grow could evaporate, especially if your industry leans heavily on exports or global sourcing.' Volatile Markets and Supply Chain Instability Although the China deal eased recession fears, experts said that uncertainty around ongoing tariffs still disrupts manufacturing and logistics. Businesses may hold back investment or retool supply chains, raising costs for middle-class consumers and slowing hiring. For example, uncertainty remains one of the most significant threats to economic momentum, particularly for businesses making long-term decisions. 'The real issue is that this deal doesn't create clarity. It reinforces an environment of 'wait and see,' Robert Khachatryan, CEO and founder of Freight Right. 'That's not how you build confidence in the economy.' Khachatryan added, 'You can't expect small and midsize businesses, who employ a huge portion of America's middle class, to plan for the future when they're stuck playing defense against the next round of tariffs.' Missed Middle-Class Priorities in the Deal While the latest Trump-China deal touts manufacturing wins, some economists warn it overlooks the broader economic trade-offs that directly affect the middle class. 'We have an experiment,' said Michael Froman, president of the Council on Foreign Relations, in a recent interview on Conversations with Jim Zirin. 'In 2018, President Trump imposed 25% tariffs on steel. Seven years later, we have 1,000 more steelworkers, but 75,000 fewer workers in manufacturing sectors that relied on steel, and a 30% drop in steel sector productivity.' This kind of trade-off may deliver political wins, but it overlooks how tariff-driven policies ripple into everyday life for the middle class. 'Over time, reduced job stability in trade-sensitive sectors and a slowdown in wage growth may exacerbate economic insecurity for families already stretched thin by inflation and debt servicing costs,' said Jean-Baptiste Wautier, a private equity CIO and World Economic Forum speaker. How To Protect Your Budget Middle-class families can shield themselves by using rewards or rebate programs and strategically stockpiling essentials before potential tariff increases. Julian Merrick, founder and CEO of Supertrader, a fintech firm focused on global markets, recommends starting with a small emergency fund, even setting aside $200 to $300, which can help families avoid debt when unexpected expenses arise. 'It also helps to cut back on spending in categories where prices are rising — things like tech, clothes or imported goods,' Merrick said. 'Families should avoid taking on new high-interest debt right now, especially for non-essentials. And for those with investments, make sure the money is spread out across different industries.' Editor's note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on More From GOBankingRates 6 Hybrid Vehicles To Stay Away From in Retirement This article originally appeared on 5 Reasons Trump's Trade Deal With China Is Bad News for the Middle Class Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Chicago Tribune
25 minutes ago
- Chicago Tribune
Union Pacific and Norfolk Southern seek 1st transcontinental railroad through a massive merger
OMAHA, Neb. (AP) — Union Pacific wants to buy Norfolk Southern in a $85 billion deal that would create the first transcontinental railroad in the U.S, and potentially trigger a final wave of rail mergers across the country. The proposed merger, announced Tuesday, would marry Union Pacific's vast rail network in the West with Norfolk's rails that snake across 22 Eastern states, and the District of Columbia. The nation was first linked by rail in 1869, when a golden railroad spike was driven in Utah to symbolize the connection of East and West Coasts. Yet no single entity has controlled that coast-to-coast passage. The railroads argue a merger would streamline deliveries of raw materials and goods nationwide by eliminating delays when shipments are handed off between railroads. The AP first reported the merger talks earlier this month a week before the railroads confirmed the discussions last week. Any deal would be closely scrutinized by antitrust regulators that have set a very high bar for railroad deals after previous consolidation in the industry led to massive backups and snarled traffic. If the deal is approved, the two remaining major American railroads — BNSF and CSX — will face tremendous pressure to merge to create a second transcontinental railroad so they can compete. The continent's two other major railroads — Canadian National and CPKC — may also get involved. The Canadian rails span all of that nation and feed into America. CPKC rails stretch south into Mexico Some big shippers like chemical plants in the Gulf may be wary of the deal due to fears of a monopoly that could would wield immense influence over rates, but other major rail customers, like Amazon and UPS, may be in favor if it means packages will arrive more quickly and reliably. Those big companies, along with unions and communities across the country that the railroads cross, will have a chance to weigh before the U.S. Surface Transportation Board. Consumers could benefit if the transcontinental rail does reduce shipping rates and delivery times. Union Pacific said that combined, the railroads would improve delivery times. There's speculation that this deal might win approval under the pro-business Trump administration, but the STB is currently evenly split between two Republicans and two Democrats. The board is led by a Republican, and Trump will appoint a fifth member before this deal will be considered. Union Pacific is offering $20 billion cash and one share of its stock to complete the deal. Norfolk Southern shareholders would receive one UP share and $88.82 in cash for each one of their shares as part of the deal that values NS at roughly $320 per share. Norfolk Southern closed at just over $260 a share earlier this month before the first reports speculating about a deal. Union Pacific's stock fell nearly 2% to $224.98 in premarket trading, while Norfolk Southern's stock dipped more than 3% to $277.40. Union Pacific CEO Jim Vena, who has championed a merger, said lumber from the Pacific Northwest and plastics produced on the Gulf Coast and steel made in Pittsburgh will all reach their destinations more seamlessly. 'It builds upon President Abraham Lincoln's vision of a transcontinental railroad from nearly 165 years ago, and will usher in a new era of American innovation,' Vena told investors Tuesday. U.S. railroads have already undergone extensive consolidation. There were more than 30 major freight railroads in the early 1980s. Today, six major railroads handle the majority of shipments nationwide. Western rival BNSF, owned by Berkshire Hathaway, has the war chest to pursue an acquisition of CSX, to the east, if it chooses. CEO Warren Buffett is sitting on more than $348 billion cash and the consummate dealmaker may want to swing for the fences one last time before stepping down as planned at the end of the year. Buffett recently threw cold water on reports that he had enlisted Goldman Sachs to advise him on a potential rail deal in an interview with CNBC, but he rarely uses investment bankers anyway. Buffett reached an agreement to buy the parts of the BNSF railroad he didn't already own for $26.3 billion after a private meeting with its CEO more than a decade ago. Yet there's widespread debate over whether a major rail merger would be approved by the Surface Transportation Board, which has established a high bar for consolidation in the crucial rail industry. That's largely due to the aftermath of a consolidation in the U.S nearly 30 years ago that involved Union Pacific. It merged with Southern Pacific in 1996 and the tie-up led to an extended period of snarled traffic on U.S. rails. Three years later, Conrail was divvied up by Norfolk Southern and CSX, which led to more backups in the East. 'We're committed to making sure that doesn't happen in this case,' said Norfolk CEO Mark George. He added that the railroads will spend the next two years planning for a smooth integration before this deal might get approved. Just two years ago, the STB approved the first major rail merger in more than two decades. In that deal, which was supported by big shippers, Canadian Pacific acquired Kansas City Southern for $31 billion to create the CPKC railroad. There were compelling factors in that deal, however, that combined the two smallest major freight railroads. The combined railroad, regulators reasoned, would benefit trade across North America. The deal announced Tuesday would merge the nation's largest freight railroad, with the smallest. Union Pacific and Norfolk Southern said they expect to submit their application for approval within the next six months and hope the deal would get approved by early 2027. They predict that they would be able to eliminate $1 billion in costs annually, but Vena said that every union worker at both railroads should still have a job. The railroads also predict they would be able to boost revenue by at least $1.75 billion each year by winning more business from trucking companies and other railroads. On Tuesday, Norfolk Southern reported a $768 million second-quarter profit, or $3.41 per share, as volume grew 3%. That's up from $737 million, or $3.25 per share, a year ago, but the results were affected by insurance payments from its 2023 East Palestine derailment and restructuring costs. Without the one-time factors, Norfolk Southern made $3.29 per share, which was just below the $3.31 per share that analysts surveyed by FactSet Research predicted.
The Hill
25 minutes ago
- The Hill
Most support Trump immigration goal, but say approach goes too far: Survey
Most Americans support President Trump's immigration goals, but they argued that the administration's approach is overreaching, according to a new survey. The Wall Street Journal poll, released Monday, found that 62 percent of U.S. adults said they are supportive of the administration's deportation of migrants who are in the country illegally. Despite the support, many respondents are against two approaches that administration has taken to facilitate Trump's robust crackdown on illegal immigration: Mass deportation without due process and deporting immigrants to jails in countries other than where they are from. Both approaches received 58 percent opposition, the survey shows. Close to 60 percent of independents said the White House has gone too far in deporting migrants without granting them a hearing or sending them back without evidence that they are in the U.S. illegally. GOP voters are strongly supportive of Trump's immigration policies, with 90 percent of them being fully on board. Just 11 percent of Republicans said the administration has gone too far, according to the poll. Around 75 percent of GOP voters also signaled support for deporting migrants without giving them a chance to appear before a judge or sit for a court hearing. Amongst all Americans, the support is at around 39 percent, the poll revealed. Nearly two-thirds of Americans, 62 percent, said the administration is deporting as many people as possible, regardless of whether they have a criminal background. Around a third of U.S. adults said U.S. Immigration and Customs Enforcement (ICE) is mainly deporting migrants who are in the country illegally and have a criminal record, according to the poll. Earlier this month, a Harvard CAPS/Harris poll found that 60 percent of voters support Trump's push to close the border. The survey showed that 75 percent of Americans are supportive of the administration's push to deport migrants who are in the country without authorization. The Wall Street Journal survey was conducted from July 16-20 among 1,500 registered voters. The margin of error was 2.5 percentage points.
