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- in Economy
Under Trump, the Small Business Administration Clamps Down
For entrepreneurs who want a loan, a government contract or just some advice, the Small Business Administration is generally a first stop. But over the past few months, getting the agency’s help has become more difficult.Under its administrator, Kelly Loeffler, a corporate executive turned senator from Georgia and vocal supporter of President Trump, the agency has aggressively cut staff. It is rolling back changes made during the Biden administration aimed at easing access to credit for the smallest enterprises, and has lowered targets for how much the federal government should buy from them.The changes are especially problematic for Black, Hispanic and immigrant entrepreneurs. In the name of eradicating diversity, equity and inclusion practices, the Small Business Administration is shedding programs aimed at helping disadvantaged businesses, including those run by women.While banks that administer the S.B.A.’s major loan programs have welcomed some of the changes, Democrats and small-business advocates have decried them — especially as the agency is also supposed to inherit a $1.66 trillion student loan portfolio from the largely dismantled Education Department.“It’s unconscionable that the Trump administration would treat such a vital agency so callously,” said Senator Edward J. Markey of Massachusetts, the ranking Democrat on the Senate Committee on Small Business and Entrepreneurship. He noted that Ms. Loeffler had ignored his requests for information about the changes. “They’re destroying the areas where they do have expertise and it’s vital to invest, and then moving over areas where the agency is going to wind up overwhelmed,” Mr. Markey said.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More
- in Economy
Trump’s Threatened Tariffs Are So Large, 10% Feels Like a Relief
As he proposes ever stiffer tariffs, President Trump has normalized his merely big ones.There has been a mantra spreading among weary corporate executives who are becoming resigned to President Trump’s tariffs while still hoping to avoid the worst of their effects: Ten percent is the new zero.The statement refers to the 10 percent tariff that Mr. Trump put in place on most U.S. imports one month ago. Such a significant increase in U.S. tariffs would have been unthinkable a few years ago. But it no longer seems like such a big deal, compared with the truly large tariffs that Mr. Trump has already imposed or threatened elsewhere.Mr. Trump’s “Liberation Day” announcement on April 2 that he was planning tariffs of 10 percent to 60 percent on dozens of America’s trading partners set off a rout in the bond markets and a flight from the U.S. dollar as investors panicked at the prospect of an economically devastating trade war. Mr. Trump also ratcheted up tariffs on China to a minimum of 145 percent amid a trade spat with Beijing, bringing much of the trade between the countries to a halt.That turmoil appears to have moderated Mr. Trump’s impulses somewhat. The president quickly paused tariffs on most countries, giving them 90 days to negotiate trade deals instead.Mr. Trump also granted a lucrative exemption from China tariffs for makers of electronics and offered some limited relief for automakers. And he has hinted that he could do more, saying he likes to be “flexible.”Investors have lapped up any signs of good news, even insubstantial ones. Stock markets have now regained nearly all of the losses they sustained after April 2, buoyed by comments from Trump administration officials that they are working to close trade deals with allies and planning to meet with Chinese counterparts to discuss their standoff.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More
- in Economy
Senate Confirms Howard Lutnick as Commerce Secretary
The Senate on Tuesday voted 51 to 45 to confirm Howard Lutnick to be President Trump’s commerce secretary, putting in place one of the administration’s top economic officials who will help oversee an agenda around tariffs and protectionism.Mr. Lutnick, who was the chief executive of the financial services firm Cantor Fitzgerald, became a central economic adviser to Mr. Trump over the past year and led his transition team. He has defended tariffs as a tool to protect U.S. industries from international competition, promoted lower corporate taxes and called for an expansion of energy production.As commerce secretary, Mr. Lutnick will take on a broad portfolio that includes defending U.S. business interests worldwide and overseeing restrictions on technology exports to countries like China.At his confirmation hearing last month, Mr. Lutnick said he would take a tough stance on the department’s oversight of technology sales to China and back up U.S. export controls with the threat of tariffs. He said the recent artificial intelligence technology released by the Chinese start-up DeepSeek had been underpinned by Meta’s open platform and chips sold by the U.S. company Nvidia.“We need to stop helping them,” Mr. Lutnick said of China, adding, “I’m going to be very strong on that.”As the United States resumes economic negotiations with the country, Mr. Lutnick is expected to play a central role. Mr. Trump said the new commerce secretary would oversee the work of the Office of the United States Trade Representative, which is traditionally the hub of trade policy.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More
- in Economy
Lutnick Grilled on Trump’s Tariffs and China During Confirmation Hearing
Howard Lutnick, a wealthy donor to President Trump who has been chosen to lead the Commerce Department, defended Mr. Trump’s plans to impose broad tariffs and said he would take a tough stance on technology sales to China during his Senate confirmation hearing on Wednesday.If confirmed, Mr. Lutnick would lead on trade policy and oversee a broad portfolio of government programs touching on business promotion, technology and science. He told lawmakers that he favored “across-the-board” tariffs that would hit entire countries rather than specific products, to equal out America’s trading relationships.He said that, while he believed tariffs on China “should be the highest,” governments in Europe, Japan and South Korea had also taken advantage of the United States on trade. He said that American farmers, ranchers and fishers were being “treated with disrespect around the world.”“We need that disrespect to end, and I think tariffs are a way to create reciprocity, to be treated fairly, to be treated appropriately,” he said. Mr. Lutnick also insisted that tariffs would not cause inflation, though many economists say tariffs are often at least partly passed on to consumers in the form of higher prices.Asked about China’s recent advances in artificial intelligence, Mr. Lutnick said he would take a tough stance on the department’s oversight of technology sales to China, and back up U.S. export controls with the threat of tariffs. He said that the recent A.I. technology released by the Chinese start-up DeepSeek had been underpinned by Meta’s open platform and chips sold by the U.S. company Nvidia.“We need to stop helping them,” he said of China, adding: “I’m going to be very strong on that.”Senator John Thune of South Dakota, the Republican majority leader, during Mr. Lutnick’s confirmation hearing on Wednesday. Republicans promoted Mr. Lutnick’s personal story, describing him as someone who had achieved great success despite facing adversity.Eric Lee/The New York TimesWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More
- in Economy
I.R.S. Commissioner to Quit as Trump Takes Office
Daniel Werfel, the commissioner of the Internal Revenue Service, told the agency’s employees that he would end his term early and step down on Monday as President-elect Donald J. Trump takes office.Mr. Trump has said he plans to nominate Billy Long, a former Republican congressman, to the role. Past presidents have treated the tax collector’s leader as a nonpartisan job that continues between administrations of different parties. President Biden chose Mr. Werfel, a former career civil servant and management consultant, to attempt a renaissance of the I.R.S., which Democrats have infused with billions in new funding that Republicans are now eager to cancel.In a message to employees, Mr. Werfel said he had decided to step down after he concluded that it was the best way to support the next administration. Douglas O’Donnell, a career civil servant at the I.R.S. who currently has the No. 2 job, will serve as the acting commissioner, Mr. Werfel said.“While leaving a job you love is never easy, I take comfort in knowing that the civil servant leaders and employees at the I.R.S. are the exact right team to effectively steward this organization forward until a new I.R.S. commissioner is confirmed,” he wrote.With more than 80,000 employees, the I.R.S. is a central part of the federal government, collecting nearly $5 trillion in tax revenue last fiscal year. With $60 billion in additional funding approved by Democrats, the agency has in recent years tried to beef up tax collection for wealthy Americans and update its antiquated technology systems.The I.R.S. has long been a villain to Republicans, who attack it as a political tool for Democrats. Mr. Long, Mr. Trump’s pick to lead the agency, has scant tax experience beyond promoting a pandemic-era tax credit for small businesses that the I.R.S. has tried to shut down because of abuse. Republicans have already canceled $20 billion of the $80 billion Democrats originally envisioned for the I.R.S., and they have frozen $20 billion more. More
- in Economy
Banks Are Racking Up Wins Even Before Trump Is Back in White House
Banks are on a winning streak, one that’s poised to intensify as President-elect Donald J. Trump takes office.Biden-appointed regulators at the Federal Reserve and other agencies presided over a relatively fruitless era of bank oversight. They tried to enact stricter rules for the nation’s biggest banks, hoping to create a stronger safety net for the financial system even if it cut into bank profits.But the rules were considered so onerous — including by some top Fed officials — that they died of their own ambitions.As proposals stalled, the foundation for existing bank oversight became increasingly shaky thanks to bank-friendly courts. During his first term, Mr. Trump appointed a slate of conservative judges who then slowly but significantly shifted the legal environment against strict federal oversight.The result? Big banks have been notching major victories that could allow them to avoid regulatory checks that were drawn up after the 2008 financial crisis, when weaknesses at the world’s largest lenders nearly toppled the global economy.And with Mr. Trump once again poised to run the White House, analysts predict that the regulations and supervisory practices that are supposed to prevent America’s biggest and most interconnected financial institutions from making risky bets could be further chipped away in the months ahead.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More
- in Economy
Michael Barr to Leave His Role as Fed Vice Chair for Supervision
Michael Barr oversaw an attempt to rewrite financial regulations that came under attack from a wide range of groups, including banks, lawmakers and even some of his colleagues.Michael Barr will step down from his role as the Federal Reserve’s vice chair for supervision by Feb. 28, or sooner if President-elect Donald J. Trump appoints a successor, the Fed said on Monday.Mr. Barr will continue to serve on the central bank’s Board of Governors. But in an interview, Mr. Barr said the decision to leave his role as vice chair of supervision was intended to sidestep a protracted legal battle with Mr. Trump that he believed could damage the central bank.Some individuals attached to the Trump administration wanted to fire Mr. Barr before his term as vice chair expired, according to people familiar with the matter who spoke on background because of the sensitivity of the issue.That could have resulted in a lengthy — and costly — legal fight over whether an incoming president has the authority to remove someone from a Senate-confirmed position at an independent agency.Some financial regulatory experts questioned why Mr. Barr — and the Fed itself — would allow a political change to influence who served in a powerful role. Jerome H. Powell, the Fed’s chair, has made a point of saying that the Fed is independent of the White House and that its decisions are not influenced by politics. Mr. Powell has also insisted that Mr. Trump lacks the legal authority to fire him from his role as Fed chair, which is also confirmed by the Senate.“I’m surprised by Barr’s announcement, because I expected him to resist Republican calls for his ouster and make a point of defending the Fed’s independence,” Ian Katz, managing director at Capital Alpha, said in an email.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More
- in Economy
Jerome Powell and the Fed Head for Another Collision with Trump
Rates may not come down as much or as quickly as had been expected, just as Trump — a self-declared “low-rate guy” — returns to the White House.Inside the halls of the Federal Reserve’s headquarters overlooking Constitution Avenue in Washington D.C., casual mentions of the incoming Trump administration are cautious and infrequent. That’s by design.Donald J. Trump had a fraught relationship with the politically independent Fed during his first term. The president wanted central bankers to lower interest rates more aggressively and faster than they thought was economically appropriate. When officials refused to comply, he blasted them as “boneheads” and an “enemy.” He flirted with trying to fire Jerome H. Powell, the Fed chair. He tried (and failed) to appoint loyalists to central bank leadership roles.As the Fed enters a new Trump era with interest rates higher than they were at any point in his first term, tensions seem poised to escalate once again — and America’s central bank is on high alert.Fed analysts try to avoid casually discussing tariffs in email or Microsoft Teams meetings, wary that the information could become public and make the Fed look anti-Trump, according to one staff economist who spoke on the condition of anonymity to discuss the sensitive matter. Hallway chatter has taken a negative tone but is often studiously generic and apolitical, according to people familiar with the mood inside the building who also requested anonymity. And while Fed officials and economists have had to begin to consider what Mr. Trump’s promised policies might do to growth and inflation, they have avoided publicly speculating.Central bankers are, in effect, keeping their heads down to stay out of the limelight. But try as they might, they appear destined for another crash course with Mr. Trump.The president-elect promised “interest rates cuts the likes of which you have never seen before” while campaigning. Fed officials have been cutting rates since September and are on course to lower them further as inflation cools, but they are unlikely to reduce them as much as Mr. Trump is hoping.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More
