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    in Economy

    Another Jolt of Uncertainty for a Global Economy Mired in It

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    The U.S. presidential election result has ensured a sharp turn in economic policy expected to upend global commerce and diverge from decades of American norms.The U.S. presidential election is over. What remains is a disorienting miasma of fresh economic uncertainty.Despite reams of campaign proposals, just how President-elect Donald J. Trump’s administration will handle policy decisions that are crucial to the global economy’s path — on trade, technology, climate, industrial policy and more — is still unclear.Meanwhile, pre-election sources of instability keep spinning. War rumbles on in Ukraine. Escalating conflict in the Middle East could reignite a rise in food and energy prices. China, a vital engine of global growth, is trying to resuscitate its flattened economy. Many poor and middle-income countries face an unscalable wall of debt.Increasing bouts of extreme weather continue to destroy crops, wreck cities and swell the flow of migrants from economically devastated regions. And advances in artificial intelligence are poised to eliminate, create and reconfigure tens of millions of jobs.Then there is the hangover from the pandemic. Philip N. Jefferson, the vice chair of the Federal Reserve, has said policymakers are still trying to understand the economic aftereffects of this “once-in-a-century disturbance of worldwide consequence.”Inflation, in particular, has become harder to predict in the pandemic’s aftermath as political and military tensions have risen, he noted.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

  • 100 Shares199 Views

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    Trump’s Economic Plans Could Worsen Inflation, Economists Say

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    Many Americans fretted about inflation as they headed out to vote. But Donald J. Trump’s approach comes with risks of a renewed boost.Americans have been chafing against higher prices for years now, propelling unhappy voters to the polls and helping to deliver the White House to the Republican candidate, Donald J. Trump.But how Mr. Trump’s policies would help on costs is unclear. And in fact, many economists have warned that his proposals could instead make inflation worse.Inflation measures how much prices are rising over a given period, usually a year. It picked up sharply starting in 2022 and remained rapid in 2023. While prices are no longer climbing as quickly, those two years of rapid increase have left costs for many common purchases — from eggs to apartments and restaurant meals — notably more expensive than consumers remember them being as recently as 2019 or 2020.For months, that has weighed on consumer confidence and caused many voters to give the nation’s economic performance poor marks, even though the unemployment rate is very low and companies have been hiring.Voters regularly cited the economy as a top concern in polls headed into the election, and they often suggested that they thought Mr. Trump would do a better job in managing it. While the economic perception gap between Mr. Trump and Vice President Kamala Harris, the democratic candidate, closed somewhat over time, it never fully faded.While rapid inflation had been a global trend, Mr. Trump regularly pinned the blame for it on the Biden administration. And exit polls suggested that voters were indeed worried about the economy as they headed out to vote. Roughly three in four voters said that inflation had caused their families hardship over the past year.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

  • 175 Shares189 Views

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    U.S. Factory Towns Laid Low by the ‘China Shock’ Are Benefiting From New Investments

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    Communities that suffered the worst of plant closings in recent decades are now gaining an outsize share of fresh investment and new jobs.For much of the last half century, economic life in the heart of North Carolina has been dominated by factory closings, joblessness and downgraded expectations. Textile mills and furniture plants have been undercut by low-priced imports from Mexico and China. Tobacco processing jobs have disappeared.Yet over the last several years, an infusion of investment in cutting-edge industries like biotechnology, computer chips and electric vehicles has lifted the fortunes of long-struggling communities.North Carolina presents a conspicuous example of this trend, yet a similar story is playing out elsewhere. From industrial swaths of the Midwest to factory towns in the South, areas that suffered the most wrenching downsides of trade are now capturing the greatest shares of investment into forward-tilting industries, according to research from the Brookings Institution, a public policy research organization in Washington.As furniture manufacturing and textile jobs vanished, Chatham County, N.C., suffered the consequences for decades.Sebastian Siadecki for The New York TimesThe Plant in Pittsboro, N.C., is home to a variety of small businesses and includes outdoor event spaces and restaurants.Sebastian Siadecki for The New York TimesBrookings researchers examined pledges of private investment across the United States, using data compiled by the Biden administration as part of its campaign to subsidize domestic production of computer chips and electric vehicles. They also tapped a Massachusetts Institute of Technology database that tracks investments in clean energy. Over the last three years, $736 billion in investment has been promised for these key industries, the researchers found.When they mapped the investments, the Brookings team concluded that nearly a third of the total is flowing into communities that experienced the worst effects of the so-called China Shock — the factory closures that followed China’s entry to the global trading system in 2001.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

  • 138 Shares199 Views

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    Working-Class Voters Are Pivotal. Both Candidates Are Vying for Their Support.

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    Kamala Harris’s plans offer a bigger boost for the working class, but Donald Trump seems to be convincing voters.Bernadette Daywalt had yet to decide whom to vote for in the presidential election. But the 69-year-old retiree said her decision would probably come down to economics.She and her 82-year-old sister have struggled to keep up with rising grocery prices over the past few years, and they now frequent a food pantry in the Philadelphia suburb where they live.“I think we’re headed downhill right now, with the cost of food, the cost of everything,” Ms. Daywalt said as she checked on her voter registration at an outreach van parked outside the Elmwood Park Zoo on a crisp October afternoon. She voted for Mr. Trump in 2016, and she felt better economically when he was president.Ms. Daywalt’s perceptions underscore a tough reality facing Democrats, who have been trying to recapture a working-class vote that has been slipping away from them.Many economists say Vice President Kamala Harris’s economic proposals would do more to help everyday Americans than the agenda put forward by former President Donald J. Trump. One model suggests that her package would boost post-tax income for the poorest Americans by 18 percent by 2026, much more than the 1.4 percent bump Mr. Trump’s ideas would offer.Income Effects of Trump vs. Harris Economic ProposalsAfter tax and transfers, estimates from the Penn Wharton Budget Model suggest that Kamala Harris’s proposals would boost low-income groups while costing rich ones.

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    Percent Change as of 2026
    Notes: Percent changes are from the baseline expectation for income in 2026. Baseline income is about $20,000 for the bottom quintile, $81,400 for the middle quintile and $327,000 for the group in the 90-95 percent range.Source: Penn Wharton Budget ModelBy 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

  • 125 Shares99 Views

    in Economy

    Can Democrats Win Back Voters From Trump on Trade Policy?

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    The Biden administration has pursued a big shift in trade policy, but it’s not clear whether that will be enough to win votes.Since Donald J. Trump won over many working-class voters in 2016 with his vows to impose tariffs and rework “disastrous” trade deals, Democrats have been scrambling to win back supporters by taking a more protectionist trade approach.Over the last four years, the Biden administration spent more time emphasizing the harm trade policy has caused to American communities than the benefits. It hit the brakes on negotiating trade deals with other countries and chose to maintain and even increase Mr. Trump’s tariffs on Chinese products. And it pumped billions of dollars into new American factories to make semiconductors and solar panels.It’s a significant shift from the decades that both mainstream Democrats and Republicans spent working to promote trade and lower international barriers.For Vice President Kamala Harris, next week’s election will be a moment of truth for whether the strategy worked.Mr. Trump has helped bring trade to the forefront in presidential elections with his vitriolic criticisms of past policy and his proposals for high tariffs. It is an issue that resonates strongly with voters in Northern swing states like Pennsylvania, Michigan and Wisconsin, where manufacturing employment fell steeply in recent decades as factories moved abroad.Biden officials have been trying to persuade more trade-skeptical voters that their policies to encourage manufacturing in the United States are working, pointing to a recent surge in U.S. factory construction.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

  • 125 Shares169 Views

    in Economy

    Trump’s Vast Tariffs Would Rock Global Businesses and Shake Alliances

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    Economists said Donald Trump’s plan to return trade barriers to levels not seen in generations would be “a grenade thrown in the heart” of the international system.At a rally in Latrobe, Pa., earlier this month, former President Donald J. Trump paused in front of a crowd holding signs that read “Save Our Steel” to pay homage to one of his favorite concepts.Tariff, he said, “is the most beautiful word in the dictionary. More beautiful than love, more beautiful than respect.”Mr. Trump demonstrated a deep affinity for tariffs during his presidency, using them as a cudgel to punish both allies and rivals as he tried to force companies to make their products in the United States.If he wins again in November, he is promising a much more aggressive approach, a full-scale upending of the trading system in which the United States is no longer a partner in the global flow of goods, but a mercantilist nation intent on walling itself off from the world.The former president, who has described himself as a “Tariff Man,” has talked about tariffs as the solution to an array of problems, from making the country rich to funding tax cuts and paying for child care. But most central to his vision is the ability of tariffs to reverse decades of globalization and force factories to move back to the United States.Mr. Trump has threatened to slap steep tariffs on every country — the most punishing levies reserved for China — to raise the cost of foreign products and try to reorder global supply chains. His tariffs would hit almost all U.S. imports, more than $3 trillion of goods.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

  • 125 Shares199 Views

    in Economy

    Global Economic Leaders Confront a New Era of Industrial Policy

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    Policymakers brace for more protectionism and the demise of “neoliberalism” if Donald J. Trump is re-elected in the U.S.At the annual meetings of the International Monetary Fund and the World Bank this week, Kristalina Georgieva, the head of the I.M.F., expressed a mix of relief and trepidation about the state of the world economy.Policymakers had tamed rapid inflation without causing a global recession. Yet another big economic problem loomed. Rising protectionism and thousands of new industrial policy measures enacted by countries around the world over the last year are threatening future growth prospects.“Trade, for the first time, is not the engine of growth,” Ms. Georgieva said at an event sponsored by the Bretton Woods Committee.Economic policymakers who convened in Washington showed little indication that they might heed the warnings.Eighty years after the International Monetary Fund and the World Bank were created to stabilize the global economy in the wake of World War II, the role of those organizations and the guiding principles behind their creation has largely fallen out of fashion. The I.M.F. and World Bank were designed to embrace a new system of economic order and international cooperation, one that would stitch the world economy together and allow rich nations to help poorer ones through trade and investment.But today, those who espouse such “neoliberal” notions of open markets are increasingly lonely voices.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

  • 150 Shares199 Views

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    I.M.F. Says Inflation Fight Is Largely Over but Warns of New Threats

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    The International Monetary Fund said protectionism and new trade wars could weigh on growth.The global economy has managed to avoid falling into a recession even though the world’s central banks have raised interest rates to their highest levels in years to try to tame rapid inflation, the International Monetary Fund said on Tuesday.But the I.M.F., in a new report, also cautioned that escalating violence in the Middle East and the prospect of a new round of trade wars stemming from political developments in the United States remain significant threats.New economic forecasts released by the fund on Tuesday showed that the global fight against soaring prices has largely been won: Global output is expected to hold steady at 3.2 percent this year and next. Fears of a widespread post-pandemic contraction have been averted, but the fund warned that many countries still face a challenging mix of high debt and sluggish growth.The report was released as finance ministers and central bank governors from around the world convened in Washington for the annual meetings of the I.M.F. and the World Bank. The gathering is taking place two weeks ahead of a presidential election in the United States that could result in a major shift toward protectionism and tariffs if former President Donald J. Trump is elected.Mr. Trump has threatened to impose across-the-board tariffs of as much as 50 percent, most likely setting off retaliation and trade wars. Economists think that could fuel price increases and slow growth, possibly leading to a recession.“Fear of a Trump presidency will loudly reverberate behind the scenes,” said Mark Sobel, a former Treasury official who is now the U.S. chairman of the Official Monetary and Financial Institutions Forum. Mr. Sobel said global policymakers would probably be wondering what another Trump presidency would “mean for the future of multilateralism, international cooperation, U.S.-China stresses and their worldwide ripples, and global trade and finance, among others.”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