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    Fed Joins Climate Network, to Applause From the Left

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    AdvertisementContinue reading the main storySupported byContinue reading the main storyFed Joins Climate Network, to Applause From the LeftThe central bank joined a network of global financial regulators focused on climate risk. The response to the move underlined its tricky politics.“The public will expect that we do figure out what are the implications of climate change for financial stability, and that we do put policies in place,” Jerome H. Powell, the Fed chair, said this month at a Senate hearing.Credit…Al Drago for The New York TimesDec. 15, 2020, 4:34 p.m. ETWASHINGTON — The Federal Reserve is joining a network of central banks and other financial regulators focused on conducting research and shaping policies to help prepare the financial system for the effects of climate change.The Fed’s board in Washington voted unanimously to become a member of the Network of Central Banks and Supervisors for Greening the Financial System, it said in a statement on Tuesday. The central bank began participating in the group more than a year ago, but its formal membership is something that Democratic lawmakers have been pushing for and that Republicans have eyed warily.The Fed’s halting approach to joining underlines how politically fraught climate-related issues remain in the United States.The network exists to help central banks and other regulators exchange ideas, research and best practices as they figure out how to account for environment and climate risk in the financial sector. While the Fed had participated informally, its decision to join as a member is the latest sign of its recognition that the central bank must begin to take extreme weather events into account as they occur with increasing frequency and pose a growing risk to the financial system — whether doing so is politically palatable or not.“The public will expect that we do figure out what are the implications of climate change for financial stability, and that we do put policies in place,” Jerome H. Powell, the Fed chair, said this month at a Senate hearing. “The broad response to climate change on the part of society really needs to be set by elected representatives — that’s you. We see implications of climate change for the job that you’ve given us, and that’s what we’re working on.”Still, the latest move could incite a backlash. The announcement comes shortly after Republican House members urged Mr. Powell and the vice chair for supervision, Randal K. Quarles, in a letter on Dec. 9 not to join the network “without first making public commitments” to accept only policies that would not put the United States at a disadvantage or have “harmful impacts” on American bank customers.Republicans have been particularly concerned that increased attention to climate risk by financial regulators could imperil credit access for fossil fuel and other energy companies. For instance, banks might be less likely to extend credit to those industries if regulators viewed such loans as risky and made them harder to provide.Mr. Powell had recently emphasized that the Fed was likely at some point to join the network alongside its peers, including the Bank of England and Bank of Japan, and the central bank first indicated last month that it would soon be joining the group. Mr. Quarles said during congressional testimony that the Fed was in the process of requesting membership and expected that it would be granted, in response to questions from Senator Brian Schatz, Democrat of Hawaii.“Now that they have joined this international effort, I will expect them to take further concrete steps towards managing climate risks,” Mr. Schatz said in a statement in response the announcement on Tuesday. “That includes setting clear supervisory expectations for how banks should manage their climate risk exposure, and using tools like stress testing to hold them accountable.”The Fed did not comment on why it decided to join now and — despite several requests since Mr. Quarles’s statement — would not say when the central bank had applied to join. Joining the network requires a formal email request from a central bank’s leader or head of supervision.The move is the latest step in an evolution in which the Fed, which once rarely spoke publicly about the issue, has paid more public attention to climate change.Business & EconomyLatest UpdatesUpdated Dec. 15, 2020, 4:17 p.m. ETEuropean Central Bank will lift ban on bank dividends, a sign of cautious optimism.Top congressional leaders met to discuss a stimulus deal and a year-end spending bill before the deadline on Friday.European truck makers say they will phase out fossil fuel vehicles by 2040.The Federal Reserve Bank of San Francisco, led by Mary C. Daly, held the system’s first conference on climate last year. Lael Brainard, a Fed governor and the lone Democrat on the central bank’s board in Washington, spoke there, and she has delivered other remarks on the topic. For the first time, the Fed’s financial stability report this year included an in-depth section on financial risks posed by climate change.Even so, the Fed has been more reticent than many of its peers when it comes to embracing a role in working to alleviate climate change and manage its fallout. The Bank of England has unveiled its plans to run banks through climate stress tests — which will test how their balance sheets will fare amid extreme weather events — though they have been postponed by the coronavirus pandemic. The president of the European Central Bank, Christine Lagarde, has indicated that her central bank is considering whether it should take climate into account when buying corporate debt.Climate change is a partisan topic in the United States, so more aggressive action to combat it could open up the Fed — which prizes its independence — to political attack. The Trump administration denied or questioned the science behind climate change, and though the incoming administration of Joseph R. Biden Jr. is poised to make it a top issue, many Republican lawmakers stand ready to police the Fed’s embrace of climate-related policy.“I’m going to be raising this issue much more vociferously — I think my colleagues will as well,” Representative Andy Barr, Republican of Kentucky and the lead signatory on the Dec. 9 letter, said in an interview on Monday. Mr. Barr said he was concerned that the Fed might move toward carrying out climate stress tests or put in place other policies that would make it harder for oil and coal companies to gain access to credit.Democrats will struggle to get policies like the so-called Green New Deal through Congress, he said, and he worries they will try to carry out their policy objectives through the “backdoor” of financial regulation. Mr. Barr said both Mr. Quarles’s statement that the Fed would be joining the Network of Central Banks and Supervisors for Greening the Financial System and Mr. Powell’s recent comments caught his attention.“The enormous power of the Fed should not be weaponized to discriminate against a wide swath of American industry,” he said.But in a demonstration of the competing pressures on the central bank, groups that applauded the Fed’s announcement on Tuesday painted joining the network as merely a first step.“Given that it is responsible for the safety and security of the world’s largest economy, we hope that it will not only catch up with central banks around the world, but, in time, lead the way in addressing systemic financial risk,” Steven M. Rothstein, the managing director of the Ceres Accelerator for Sustainable Capital Markets, said in a statement. The group works with investors and has been pushing for the Fed to join the network, including in a report and letter this year.“Our economy deserves no less,” Mr. Rothstein said.AdvertisementContinue reading the main story More

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    How Biden Can Move His Economic Agenda Without Congress

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    #masthead-section-label, #masthead-bar-one { display: none }The Presidential TransitionliveLatest UpdatesElectoral College ResultsBiden’s CabinetDefense SecretaryAdvertisementContinue reading the main storySupported byContinue reading the main storyHow Biden Can Move His Economic Agenda Without CongressUnion leaders and policy experts say the next administration could do plenty on behalf of workers through regulation and other powers.President-elect Joseph R. Biden Jr. may be able to achieve his goals on labor policy even without a cooperative Congress.Credit…Hilary Swift for The New York TimesDec. 15, 2020, 9:00 a.m. ETPresident-elect Joseph R. Biden Jr.’s ability to reshape the economy through legislation hinges in large part on the outcome of the two Georgia runoffs in January that will decide control of the Senate. But even without a cooperative Congress, his administration will be able to act on its agenda of raising workers’ standard of living and creating good jobs by taking a series of unilateral actions under existing law.“If you pay attention to what Trump did and go about it from a different viewpoint, you can accomplish a lot,” said Thomas M. Conway, the president of the United Steelworkers union. Much of this work will fall to the incoming labor secretary, whose department has the authority to issue regulations and initiate enforcement actions that could affect millions of workers and billions of dollars in income.Mr. Biden’s labor secretary could substantially expand eligibility for time-and-a-half overtime pay. In 2016, the Obama administration extended that eligibility to salaried workers making less than about $47,500 a year, but a federal court suspended the Obama rule, and President Trump’s Labor Department set the cutoff at roughly $35,500 rather than continue to appeal. The Biden administration could make millions more salaried workers eligible for time-and-a-half overtime pay by reviving or expanding the Obama criterion and defending it in court.The Labor Department will also have an opportunity to fill several monitoring and enforcement positions created under the United States-Mexico-Canada Agreement that are likely to go unfilled during the Trump administration. The accord, a revision of the North American Free Trade Agreement, allows the United States to block imports from facilities in Mexico that curtail workers’ rights to unionize and bargain collectively. Pursued aggressively, the enforcement could help mitigate downward pressure on U.S. manufacturing wages stemming from unfair competition with Mexico.Mr. Biden’s Labor Department is likely to be more assertive in a variety of other enforcement efforts than its predecessor, which ended an Obama-era policy of typically trying to collect double the amount of wages that lawbreaking employers failed to pay workers under minimum-wage or overtime requirements.“Just getting back wages in small amounts doesn’t provide any incentives for companies to comply,” said Catherine Ruckelshaus, general counsel of the National Employment Law Project, which has ties to the Biden transition team. The Biden administration is likely to revive the Obama approach.Revisiting Labor RulesUnion membership, which has dropped to 10 percent of U.S. workers from roughly double that figure in the early 1980s, could receive a significant boost during the Biden administration, which has signaled that it intends to work closely with the labor movement.Under Mr. Biden, the National Labor Relations Board is likely to be far more aggressive in punishing employers that appear to break the law while fighting union campaigns. It can issue a regulation making it easier for the employees of contractors and franchises to hold parent companies accountable for violations of their labor rights, such as firing workers who try to unionize.According to Benjamin I. Sachs, a Harvard Law School professor, the board could also seize on a legal provision that allows the federal government to cede jurisdiction to the states for regulating labor in certain industries. That could enable a state like California or Washington to create an arrangement in which gig workers, with the help of a union, negotiate with companies over wages and benefits on an industrywide basis in that state, a process known as sectoral bargaining.Under such a system, a union would have to show support from a fraction of workers in the industry, such as 15 or 20 percent, to be able to negotiate with multiple gig companies on behalf of all workers. By contrast, under federal law, the union would typically have to win majority support among the workers it sought to represent, a daunting challenge in a high-turnover industry like gig work.Other labor experts, like Wilma B. Liebman, who led the labor board in the Obama administration, affirm that the board can cede its authority to states but are more skeptical that it would do so in the case of gig workers.Helping Home-Care WorkersThe federal government, through its control of the Medicaid program, could accomplish something similar for home-care workers, who usually work independently or for small agencies that have little power to raise pay because states set the rates for their services. The agencies sometimes resist union campaigns aggressively for fear that allowing workers to bargain for higher wages will put them at a competitive disadvantage.A handful of Democratic-leaning states, like Washington, have addressed this issue by allowing workers to bargain with the state for rate increases that effectively apply industrywide, eliminating the downside that a single agency would face if it raised wages unilaterally.The Service Employees International Union, which represents home-care workers across the country, believes that the Biden administration could encourage other states to create such industrywide bargaining arrangements — for example, by making additional money available to states that adopt this approach. Hundreds of thousands of additional home-care workers could benefit.The federal government, under a provision in the Medicaid law that requires states to keep payments high enough to ensure an adequate supply of home-care workers, could also intervene directly to raise wages and benefits for these workers.“We look forward to working with the Biden administration to make changes to the Medicaid program that can turn home-care jobs into good union jobs,” said Mary Kay Henry, the president of the service employees union.The Presidential TransitionLatest UpdatesUpdated Dec. 15, 2020, 6:45 p.m. ETBiden will name Gina McCarthy as the White House’s climate coordinator.Dominion’s C.E.O. defends his firm’s voting machines to Michigan lawmakers, denouncing a ‘reckless disinformation campaign.’Biden will nominate Jennifer Granholm for energy secretary.Using Federal Contract CloutOutside of specific agencies like the Labor Department, the Biden administration will have considerable leverage over the working conditions of the roughly five million workers employed by federal contractors and subcontractors.President Barack Obama signed executive orders raising the minimum wage for these workers to $10.10 an hour and entitling them to at least seven days a year of paid sick leave. Mr. Biden could raise the minimum wage for contractors much further — some are urging $15 an hour — while also mandating that they receive paid family leave and paid vacation days, as proposed by Heidi Shierholz, a senior Labor Department official under Mr. Obama.Mr. Biden could also use the federal government’s buying power to create more domestic manufacturing jobs, a goal he highlighted during the campaign. One approach would be to sign an executive order laying the groundwork for a Buy Clean program of the sort that California introduced in 2017.Under the program, contractors bidding on state infrastructure projects, like steel makers and glassmakers, must adhere to a certain standard for so-called embodied emissions, essentially the amount of carbon emitted when the material is produced, transported and used in construction. Tighter limits tend to favor domestic manufacturers over competitors in countries, like China, that are farther away and where production is often less environmentally friendly.“The incoming administration has broad power to put forth an idea like Buy Clean,” said Mike Williams, deputy director of the BlueGreen Alliance, a coalition of unions and environmental groups. That includes establishing a way to measure emissions and creating a database in which manufacturers are required to disclose them.Promoting Job CreationWhile existing law requires the federal government to favor domestic suppliers in procurement, a variety of waivers allow agencies to award contracts to overseas companies. Mr. Biden noted during the campaign that the Defense Department spent billions on foreign construction contracts in 2018, and he has pledged to close such loopholes.The most aggressive version of this approach would be to revoke a broad waiver that allows agencies to treat purchases from dozens of countries with which the United States has trade relations — including Japan, Mexico and many in Europe — as though they were made in America. Mr. Biden has indicated that he is more likely to try to negotiate new rules with trading partners to address this issue.The Biden administration could also instruct contracting officers to broaden the criteria they use to assess bids. A set of contracting rules laid out in a 1984 law, along with Washington’s growing preoccupation with spending cuts in recent decades, led administrations of both parties to focus on seeking the lowest upfront price.But the Biden administration could elevate value over price — under the same logic that says a $30,000 Cadillac may be a better deal than a $25,000 Ford Focus. The approach would favor companies whose workers are better paid but also better trained and more productive than competitors’.Mr. Biden could set some of these changes in motion through an executive order stating that federal agencies should focus more on quality and working conditions when assessing value. But because executing many of these shifts would be a question of day-to-day management rather than sweeping changes, some policy experts have proposed that the Biden White House create a dedicated office to oversee procurement across the administration.Anastasia Christman, an expert on government contracting at the National Employment Law Project, compares the idea to the White House Office of Faith-Based and Community Initiatives that George W. Bush created in the early 2000s, whose goal was to scour the federal bureaucracy for ways that religious organizations could compete for government funds. In this case, Ms. Christman said, the objective would be to ensure that contracting officers across agencies are using the right criteria in awarding contracts.“It would help contracting offices think differently about how to do the assessment,” Ms. Christman said. “How do you ask right kind of follow-up questions? Why is this bid lower than all others? What is that resting on?”AdvertisementContinue reading the main story More

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    Biden Picks Katherine Tai as Trade Representative

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    #masthead-section-label, #masthead-bar-one { display: none }The Presidential TransitionLatest UpdatesFormal Transition BeginsBiden’s CabinetDefense SecretaryElection ResultsAdvertisementContinue reading the main storySupported byContinue reading the main storyBiden Picks Katherine Tai as Trade RepresentativeMs. Tai, a chief trade lawyer in the House, has extensive experience with China and played a key role in hammering out the new North American Free Trade Agreement.Katherine Tai appeared before the House Ways and Means Committee last year. If confirmed, Ms. Tai would be the first woman of color to serve as U.S. trade representative.Credit…C-SPANPublished More

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    Report Points to Microwave ‘Attack’ as Likely Source of Mystery Illnesses That Hit Diplomats and Spies

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    AdvertisementContinue reading the main storySupported byContinue reading the main storyReport Points to Microwave ‘Attack’ as Likely Source of Mystery Illnesses That Hit Diplomats and SpiesA government-commissioned report provides the most definitive explanation yet for “Havana syndrome,” which struck scores of American employees, first in Cuba and then in China, Russia and other countries.Many government employees afflicted by the illness, which was first disclosed in Havana, suffered from dizziness, fatigue, headaches, and loss of hearing, memory and balance.Credit…Meridith Kohut for The New York TimesBy More

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    After Biden Win, Nation’s Republicans Fear the Economy Ahead

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    #masthead-section-label, #masthead-bar-one { display: none }The Coronavirus OutbreakliveLatest UpdatesMaps and CasesWho Gets the Vaccine First?Vaccine TrackerFAQAdvertisementContinue reading the main storySupported byContinue reading the main storyAfter Biden Win, Nation’s Republicans Fear the Economy AheadPolling shows that Republicans have turned bearish on the outlook for their family finances since the election, while Democratic optimism is rising.By More

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    Biden and His Economic Team Urge Quick Action on Stimulus as Risks Mount

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    #masthead-section-label, #masthead-bar-one { display: none }The Presidential TransitionliveLatest UpdatesFormal Transition BeginsBiden’s CabinetSecretary of StateElection ResultsAdvertisementContinue reading the main storySupported byContinue reading the main storyBiden and His Economic Team Urge Quick Action on Stimulus as Risks MountThe president-elect introduced key nominees in Delaware, while lawmakers exchanged new proposals with prospects for a deal still dim.President-elect Joseph R. Biden Jr. acknowledged that any stimulus agreement would necessarily fall far short of the trillions of dollars that Democratic leaders have insisted on for months.Credit…Kriston Jae Bethel for The New York TimesBy More

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    Biden Expected to Name Top Economic Officials This Week

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    WASHINGTON — President-elect Joseph R. Biden Jr. is expected to name top members of his economic team this week, including Cecilia Rouse, a Princeton labor economist, to run the Council of Economic Advisers, and Neera Tanden, the chief executive of the Center for American Progress, to lead the Office of Management and Budget, according to people familiar with the matter.The announcement — which will include Mr. Biden’s decision to name Janet L. Yellen, the former Federal Reserve chair, as Treasury secretary — will culminate in several women in top economic roles, including the first Black woman to lead the Council of Economic Advisers. All three jobs require Senate confirmation.With the picks, Mr. Biden is showcasing a commitment to diversity in his advisers and sending a clear message that economic policymaking in his administration will be shaped by liberal thinkers with a strong focus on worker empowerment as a tool for economic growth.Two of Mr. Biden’s top economic aides during his presidential campaign, Jared Bernstein and Heather Boushey, will also be named to the Council of Economic Advisers, which is a three-member team that advises the president on economic policy. Both Ms. Boushey and Mr. Bernstein come from a liberal, labor-oriented school of economics that views rising inequality as a threat to the economy and emphasizes government efforts to support and empower workers.In many ways, his team is unified by a commitment to running the economy hot — with strong growth and low unemployment — in order to drive up wages. And it is likely to signal an embrace of spending to help workers, businesses and local governments recover from the pandemic recession, regardless of the effect on the federal budget deficit.“President Biden’s appointments show that he is quadrupling down on his commitment to working people and raising wages,” said Jason Furman, an economist at Harvard University’s Kennedy School of Government and the former head of the Council of Economic Advisers under President Barack Obama. “He has appointed four of the best labor market economists in the country to head the Treasury and the Council of Economic Advisers.”In addition to those roles, Mr. Biden is expected to name Adewale Adeyemo, a senior international economic adviser in the Obama administration, as deputy Treasury secretary.Mr. Biden has also selected Brian Deese, a former Obama economic aide who helped lead that administration’s efforts to bail out the American automotive industry, to lead the National Economic Council, according to three people with knowledge of the selection.Mr. Deese, 42, is not an academic economist but a veteran of economic policymaking, having served as the acting head of the Office of Management and Budget and the deputy director of the Economic Council under Mr. Obama. He was also a special adviser on climate change to Mr. Obama, a role that could signal Mr. Biden’s commitment to fashioning an infrastructure bill for his legislative agenda that heavily features spending on clean energy initiatives.Mr. Biden on Sunday announced an all-female White House communications staff, with Jennifer Psaki, a veteran of the Obama administration, in the most visible role as White House press secretary.Kate Bedingfield, 39, who served as a deputy campaign manager for Mr. Biden, will serve as the White House communications director. Karine Jean Pierre, who previously served as the chief public affairs officer for MoveOn.org, will be the principal deputy press secretary. Pili Tobar, a former immigrant advocate with the group America’s Voice, will serve as the deputy White House communications director.Symone Sanders, a senior adviser to Mr. Biden on the campaign, will serve as the senior adviser and chief spokeswoman for Vice President-elect Kamala Harris. Ashley Etienne, a former senior adviser to Speaker Nancy Pelosi, will serve as the communications director for Ms. Harris.The appointments indicate Mr. Biden’s plan to include racial, gender and ideological diversity in top roles, fulfilling a campaign pledge to ensure that a broad swath of America is represented in policymaking decisions.But they could fall short of hopes within the progressive wing of the Democratic Party, which has been frustrated that their views are not being sufficiently represented in early personnel decisions. In particular, the decision to select Ms. Tanden, a divisive and partisan figure in the Democratic Party, could culminate in an intraparty fight, as well as a confirmation battle.Republicans, who are expected to retain control of the Senate, are unlikely to easily pass Ms. Tanden, an Indian-American who advised Hillary Clinton’s 2016 presidential campaign and has been one of the most outspoken critics of President Trump.The Presidential TransitionLatest UpdatesUpdated Nov. 29, 2020, 6:35 p.m. ETBiden names all-female communications team with Jen Psaki as press secretary.Biden sees orthopedic doctor after spraining his ankle while playing with family dog.Biden team wants to tackle child care, elder care, preschool in one overarching plan.She also faces a challenge from Senate Democrats given her role in the 2016 election: Many of those who worked for Senator Bernie Sanders of Vermont, who ran against Mrs. Clinton, remain convinced that Ms. Tanden was part of a group of Democrats working behind the scenes to scuttle his nomination.Mr. Sanders, who ran against — and ultimately endorsed — Mr. Biden, is the top Democrat on the Senate Budget Committee, which vets the director of the Office of Management and Budget, putting the fate of Ms. Tanden’s nomination under his watch.Josh Holmes, a former chief of staff to Senator Mitch McConnell of Kentucky, the majority leader, referred to Ms. Tanden on Twitter on Sunday as a “sacrifice to the confirmation gods,” suggesting that her downfall would sate Republican anger toward Mr. Biden’s presidency and allow other nominees to more easily win confirmation.Drew Brandewie, a spokesman for Senator John Cornyn, Republican of Texas, said on Twitter on Sunday evening that Ms. Tanden “stands zero chance of being confirmed.”The selection of Ms. Tanden, who was involved in the development of the Affordable Care Act as an adviser to the Department of Health and Human Services during the Obama administration, is likely to resurface questions about the funding of the Center for American Progress. The New York Times reported last year that from 2016 through 2018, the center accepted nearly $2.5 million from the United Arab Emirates to fund its National Security and International Policy initiative.In addition, hacked emails from Ms. Tanden that were released through WikiLeaks in 2016 could also provide additional fodder for her critics.Mr. Biden’s other picks are most likely less contentious. Ms. Rouse, a labor economist, worked on Mr. Obama’s Council of Economic Advisers from 2009 to 2011 and at the White House’s National Economic Council during the Clinton administration in the late 1990s.Claudia Goldin, a Harvard economist, a pioneer in research on the role of women in the American economy and one of Ms. Rouse’s thesis advisers in graduate school, called her a leading expert on labor markets and education.“She is a deeply thoughtful person and a superb listener who brings out the best of those around her,” Ms. Goldin said.Mr. Bernstein was Mr. Biden’s first chief economist when he was vice president and has written extensively on the power of low unemployment and strong economic growth to bolster workers and wages. Ms. Boushey runs the Washington Center for Equitable Growth, a liberal think tank focused on inequality, and was a top policy adviser to Mrs. Clinton in 2016. She has focused much of her research and writing on government initiatives meant to increase women’s participation in the labor force, such as paid leave programs.The appointments drew praise from Kevin A. Hassett, Mr. Trump’s first Council of Economic Advisers chairman.“They have put together a very strong team of experienced policymakers and smart economists,” Mr. Hassett said. “At this difficult time, it is great to know that a strong C.E.A. will be helping to guide policy.”Mr. Adeyemo is an immigrant from Nigeria and has extensive experience working at the Treasury Department during the Obama administration, when he was a senior adviser and deputy chief of staff. Mr. Adeyemo was also Mr. Obama’s chief negotiator for the macroeconomic policy provisions of the Trans-Pacific Partnership, which Democrats ultimately opposed, and served as the first chief of staff of the Consumer Financial Protection Bureau. After a two-year stint as a senior adviser at BlackRock, he joined the Obama Foundation in 2019 as its president.Michael D. Shear and Jeanna Smialek contributed reporting. More